Budgets

The 31 Day Spending Diet

January 16, 2015 By Twila Van Leer

Personal finance planning by eliminating excess spending. — Can you go on a 31 day money diet and cut out all spending on unnecessary goods?

Haven’t gotten serious yet about a resolution for the New Year? Here’s a thought: Instead of resolving to lose pounds, resolve to lose debt and live more frugally.

Eliza Cross, a blogger at Happy Simple Living can offer some advice. She has started each of the past six years on a fresh-start basis. To begin with, she spends no money beyond the necessary monthly bills, for 31 days. That means no restaurants, no movies, no fast-food purchases, no impulse items. Nada.

She gets excited when she realizes how much money she saves by bypassing everything except the bare essentials. The break from spending also inspires her to be ore cognizant of what she spends and what she spends it for. Then she maintains the attitude as the year moves along.

Her tips:

Look for free activities in your area. Local museums and art galleries often have special events. Libraries have moved way beyond books and now have DVDs and other media, all for free.

Plan some home cooking. You’ll find that in-season foods are cheaper. When you cook, make a double batch and freeze half. A slow cooker can tenderize a tougher, cheaper cut of meat if you let it simmer all day.

Treat yourself now and again. The tough part of any diet is that awful feeling that you’re starving. Don’t hoard the fancy lotions, soaps and scented candles that tend to multiply at Christmas. Wear your nicest nightie and whip up the baked goody mix that is languishing in your cupboard. Splurging in this way once in awhile can take the die out of diet. Just don’t overdo.

Make your friends part of the challenge. Tell them what you are doing and most likely they’ll go along cheerfully when you invite them over for potluck rather than heading to the expensive restaurant. Create some new traditions. If a friend has a birthday during your January spending fast, for instance, recycle a book you really enjoyed and create an opportunity to share your thoughts after she has read it. Make her lunch or share a trip to one of the free events you have identified.

There’s nothing that says January must be the month for your adventure in no-spending. It just happens to be traditionally the month for new resolutions. If another month works better, feel free to change your target period. The whole idea is simply to end mindless spending and be more wise about what you do with your money. Then you can start deciding how to make the money you saved work for you toward a more stable personal financial plan.

Gas Prices To Remain Low In 2015

January 14, 2015 By Twila Van Leer

Major airline companies are saving billions of dollars in monthly fuel bills.

For the last three months in 2014, average gas prices dropped almost daily in the United States and the Energy Department predicts that American drivers will continue to see prices in the same range as the new year begins.

The department is forecasting a price of $2.60 per gallon. That would be 23 percent lower than the predicted average for 2014, the lowest since 2009. What that means to consumers is more money to spend for other things and a boost to the overall economy as the costs of transportation and shipping goods drop.

The average per-gallon cost of $2.66 registered in the last week of December is 61 cents less than a year ago, the agency reported.

At the root of the rapid decline is a drop in crude oil supplies worldwide. Global prices were down to $66 per barrel after hitting a high of $115 per barrel last June. Rising production in the U.S. contributed to high supplies around the globe. At the same time, slow economic growth in Europe and Asia has lessened demand.

Oil companies are trimming production plans for the coming year. U.S. crude oil production is expected to rise by 300,000 per day to a total of 9.3 million barrels. Before the precipitous drop in prices, the EIA had forecast a 400,000-barrel per day increase in production.

Home heating costs will fall this winter, according to the agency’s predictions. Weather forecasts do not predict a long period of low temperatures and prices for propane and heating oils are much lower.

The average savings to U.S. households for 2014 was $115. If prices stay low, as expected, the 2015 aggregate savings could be $75 billion. Gas prices are closely associated with consumer confidence, which is at its highest since the recession. The reduction in oil and gas prices contributed to better-than-expected holiday spending, according to Goldman Sachs.

South Carolina has had the cheapest gas for the past three years, at an average $3.10 per gallon. Missouri, Mississippi, Tennessee and Arkansas were next in line. Hawaii had the highest prices at $4.16 per gallon, followed by Alaska, California, Connecticut and New York.

The 2015 prices are expected to bottom out after the midpoint of the year and begin rising again.

Saving Money In 2015

December 29, 2014 By Twila Van Leer

31 percent of resolutions set this year revolve around money.

If you are determined to save money toward a specific goal, the first step is to decide in a concrete way how much money you are really talking about.

Write down what it is you want. Then begin the process by doing some comparison shopping for the item you have in mind. Don’t forget the costs of delivery, registration, installation, shipping, insurance and possible sub-charges. Let the bottom line contain every possible element that will play into the final cost.

For instance: you want a new refrigerator, complete with ice-maker and plenty of extra freezer space. That’s the easy part, but the hard figure – what it really will cost – is the one you need to get planted in your mind.

If you intend to finance a big-ticket purchase, consider what amount you want to pay down and then realistically figure what your payments will be. A large down payment might require a longer savings period, but result in smaller installment payments. Make it work for your particular budget.

If you want to save enough to buy your item outright, say the fancy new refrigerator, and have all the costs totaled, look at the total (probably about $1,500) and then begin to set money aside. Don’t just expect that you will have $50 or so to add to the pot now and again. Develop a savings schedule that is reasonable and stick with it.

If you want to have the new fridge in six months, that means you must save $250 per month to meet the total. If you need more time, create a nine-month schedule that calls for $167 per month. You might want to divide that between two paychecks per month, or $84 per whack.

Some people find it hard to actually stick with the agenda they have set. It’s always possible to find something you want or think you need more than putting the money into your account and leaving it alone. That’s when it might be a good idea to open a dedicated savings account that is not linked with your checking account or any account that has an ATM card. Then have the amount you have settled on automatically transferred from your checking account to that savings account on a regular basis.

That’s the set-it-and-forget-it approach and, according to the experts, it’s the best way to achieve a specific savings goal. Before you know it, you’ll be sipping lemonade made cool with ice from your new fancy refrigerator – or enjoying whatever it is you set out to save for just a short time ago.

Impulse Buyers Becoming Extinct?

December 19, 2014 By Sherry Tingley

It is happening more and more. Today’s shoppers come to the store with something in mind, they pick it up and they leave without adding to the cart. The trend is likely to change the way the retailers approach sales.

The sellers often offer loss-leaders and deep discounts because they depend on shoppers to expand the list once they are inside the doors. They put milk at the back of the store and line the aisles and ends of aisles with tempting items. If the shoppers ignore these come-ons, the merchants lose.

Impulse buying is a psychological phenomenon, analysts say. Resisting it can be hard, according to Kit Yarrow, a professor at Golden Gate University, whose specialty is consumer psychology. She is quoted in a Wall Street Journal article.

Most everyone succumbs to impulse buying at times, Yarrow says. The best solution is to avoid situations in which you are tempted. Eating a piece of chocolate before going shopping may help. The glucose supports self-control. Giving yourself limited shopping time gives less time for temptation. If you make it an all-day excursion, the chances are great you’ll snatch something off the shelves that you hadn’t planned.

Online shopping has had an effect on impulse buying, Simply the use of technology has changed shopper psychology. People think and relate to others differently, Yarrow says. In most instances, these changes tend to take the thrill out of random shopping.

The online shopper has changed the whole process. Many shoppers want a more streamlined experience.

The recent recession had an effect on shoppers as well. When money got tighter, people were more careful about spending. They were less tempted to make unplanned purchases, despite the allure. They made fewer subconscious choices.

Impulse buying is triggered by one of two factors: An attractive price or an exciting purchase. Today’s buyer, faced with a glut of products, tends to look first to the pocketbook effect. Those who finally submit to their impulses often are emotionally drained because of family and/or work demands, Yarrow said. Or there are the newcomers to the shopping milieu whose resistance to impulse buying is lower. People who are angry in general may make shopping an outlet for unexpressed emotion.

To avoid the temptation to add to your shopping cart, follow a few simple rules:

Wait 20 minutes before making the purchase. That is the usual time it takes to cool the urge.

Think about what the purchase may cost you, not just the price of the item, but your decreased ability to buy what you might want more. Remind yourself how good a zero balance on your credit card feels. Or how you could be moving closer to a long-range financial goal such as a new car or a vacation. Remember how long you have to work to fund the purchase you are considering. Stalling is a good tactic in financial planning.

Delay shopping if you are tired, hungry or thirsty. Those physical demands may confuse your thinking about what you need. Avoid paying with apps or credit cards if possible. If you use cash, it is easier to see money leaving your hands.

Top 10 Price Comparison Smart Phone Apps

December 17, 2014 By Sherry Tingley

Top 10 Price Comparison Apps — Get the best prices while shopping by using Smart Phone apps.

Notice just how many people are using their smart phones when you are out shopping. According to Shopatron’s Retailer eCommerce study, 86% of shoppers consult their smartphones. Over half of them are looking to compare prices, but they also want some extras, like product reviews.

PC magazine recently published a list of the top 10 smart phone apps in 2014. These apps have just about anything you would ever want from a price comparison app. Try some out and see if you don’t end up saving some money this Christmas season.

1. RedLaser – Simply scan the bar code and do your price comparisons.

2. ShopSavy – Input a product and the app will look for it. Handles bar code scanning and it has a SKU finder.

3. BuyVia – Will alert you for different products. Has a bar code scanner. Quotes reviews on products.

4. Smoopa – Scan the bar code and get a yes or no for getting the best price on an item where you are shopping. Earn rebate dollars for use of the app.

5. The Find – Scan the bar code and locate nearby deals and whats available online. Set pricing alerts to notify you of the lowest price point.

6. PriceGrabber – Searches online stores for deals and compares online prices for you. Results from 160 U.S. cities.

7. Consumr – Bar code scanner and shows product reviews. Earn rewards for placing reviews.

8. ScanLife – Online and local price comparisons with product reviews. Allows you to share deals on Facebook. Earn rewards.

9. ShopAdvisor – Price comparisons through bar code scanning and magazine scanning. Set alerts for low price deals.

10. Walmart Savings Catcher – Scan your receipt and compare prices of items against competitors advertised deals. Receive money back on a rewards card.