Money Management

Debt-Free On Any Income

March 31, 2010 By Sherry Tingley

Financial security may be hard to imagine for a lot of people. To acquire this type of security means that you will have to make sacrifices to achieve debt free living. If you have gotten yourself into debt for medical reasons, lost jobs, over speculating or even the bitter sweet problem of self indulgence, then you will need to find a way to crawl out from the burden of debt.

debt-free-living — Not what you were expecting?

Debt has two faces. One face is called good debt. Good debt is for purchases like housing or schooling that will increase in value over time. The other face of debt is ugly. It’s consumer debt on credit cards that have interest rates that are not tax deductible and can rise over time.

Many books have been written about getting out of debt, which most agree that they want to do. Some dream that they want to become debt free and some people actually do become debt free.

Lyle and Tracy Shamo have written a book called, “Debt-Free On Any Income.” It has an excel spreadsheet program that can help you list all of your debt and pay it down systematically. This is a good system to use and will help you get out of debt.

Let’s say you have four credit cards that have a variety of debt on them. Say for example the balances are $7,540, $238, $4,333, and $1,980. You are looking at a $14,091 debt. That should be enough to wake you up that you need a better payoff plan.

One way to tackle this debt is to make the minimum payments on each account. Then you are easily looking at a very long time before you’ll be debt free, but your credit score will stay intact. Say you decide that you are going to use $200 every month to pay towards your credit card debt. You would want to take the $238.00 debt and put money towards paying off that amount.

When you are done with that bill, you use the same $200 and put it towards the $1,980 debt until it is paid off. Theoretically you should now have more than $200 to put towards your monthly debt. Not having the minimum payment for these two bills could free up maybe $75 a month. So now you can put $275 a month toward your $4,333 bill. As you continue doing this, your monthly minimum payments will go down and the amount you can put towards your debt payoff will go up. By the time you are solely focusing on the largest debt, you’ll have more to pay that off every month.

The key to this plan though is to not incur more debt at the same time you are doing this. Basically you need to decide to quit spending money that is not in your bank account. When that becomes a lifelong habit, you won’t have to face these problems again and again.

The Bank of America/MBNA has issued credit cards and consumer debt they report is $194.70 billion. This includes the U.S., Spain, Canada, Ireland and the U.K. The average credit card debt per household is $16,007, according to CreditCard.com.

All of us can use a little help in controlling consumer debt and living a debt-free lifestyle. Practice using the payoff techniques and the spending rules and it won’t be long before you are on your way to becoming debt free.

How To Apply For A Government Grant

March 17, 2010 By Sherry Tingley

: Image by Francisco Diez via Flickr

There are many different types of grants. The United States Government offers over 1,000 grants and a total amount of $500 billion dollars is available for these grants. Grants are awarded to people who have demonstrated that there is a public benefit for their project or research.

There are twenty one different categories that government grants fall into. There are environmental grants, educational grants, energy grants and many others. For a full list of the categories, you can go to www.grants.gov.

Grants are available to companies or organizations and to individuals. There are more grants available to organizations than there are to individuals. The government website lists 27 grants for individuals and hundreds of grants available for organizations.

One example of a grant for individuals is offered by the United States National Fish and Wildlife Service. They want to promote interest in conservation, and ecology. There is $5,000,000 available to be awarded for this project and they will give 40 awards out. The highest amount awarded can be up to $500,000 and the lowest amount awarded will be $1,000. So what does this grant require you to do?

They are looking for people interested in natural resource careers and would like to provide individuals with guidance and training by professionals. You will be working in wildlife refuges, fish hatcheries, and ecological services offices as an intern. You will be assigned seasonal work sometime between June 1 and Sept. 30. Award recipients need to be willing to administer a program for identifying and recruiting people for assignments at various stations in the United States.

After you have found a grant that fits your expertise and interest, you will need to go through an online application procedure at www.grants.gov. There are multiple steps involved in applying, however there are videos to help you walk through the entire process.

You first will need to register with the website and then you need to apply for the grant you want. This procedure can take time to do, so plan on several weeks for this process.

Writing a successful grant proposal can be very challenging and competitive. You have several options. One is that you can hire someone to write it for you or you can train yourself to write a good proposal. There are classes you can take that can prepare you for this.

If you are going to write the grant yourself, you will need to summarize your project in two or three paragraphs. You will need to communicate important information about your organization that shows that you can be trusted to use their funds wisely. You’ll need to state what your organization’s track record is with similar achievements. One thing to remember when writing your proposal is to describe the problem you are attempting to solve with the same magnitude as the solution you provide.

Although the procedure for applying is lengthy and requires you to write a very good proposal, you should try your best and see if you qualify. A federal grant could be just what you need.

Organize Your Financial Life

March 4, 2010 By Sherry Tingley

Keeping your financial life in order is one way to get yourself on the pathway to being wealthy. When you have a pile of bills and paper work cluttering up your office, it is likely that you don’t know what is coming in and going out. You have relinquished control when you are in that state. If you have one huge plastic bin that you throw all your mail in you’ll want to update your system.

If someone needed your tax returns for the past year, could you locate them easily? If you needed your social security card, birth certificate or will, would you know where they are?

Have you left instructions for your family members to retrieve important financial information in case you passed away? Do they know where your life insurance policies, bank accounts or your property deeds are located? Dealing with the death of a loved one is difficult enough without putting the burden of locating your important information on the shoulders of your children, relatives or friends.

Create a filing system that will be easy for you to use and tell your family where you’ve put your important papers. A filing system is important for keeping tabs on your investments, your tax returns, your will, your insurance information and other legal documents. Is your system going to help you locate the important papers when they are needed? Most people understand how helpful a filing system is once they have it working for them.

What do you do with your mail? There are so many advertisements and junk mail that accumulate. It’s best to deal with this trash on a daily basis. If you have mail that you want to get rid of, be sure to use a shredding machine. Important information can be on unwanted mail. There are people who make a point of rummaging through trash to get this information and that can put you in serious risk for identity fraud. You don’t want that to happen to you.

What about bills that come in? Where do you put them before you pay them? With the online banking services available you can simply take the bill and set up a scheduled payment for it that will be sent out when you choose it to be sent. Then destroy the bill if you don’t need it for any record keeping. If you can keep up with the mail and bills coming in with a system that is orderly, you’ll avoid a lot of late payment fees and be able to use the money you earn more effectively.

No plan is going to work for you if you don’t actually do it and with money matters, some people just hate dealing with organizing this information. Even looking at a credit card bill can feel devastating. If you’ve had spending sprees that you regret, you won’t even want to open your credit card bills.

It may be difficult for you to imagine what is going to get you back in control of your financial life. The most important thing to do is to have the courage to create a good system that works for you. Get rid of the large bin that you toss your mail into and forget about for weeks on end. Get back on the pathway to wealth by creating a system that works for you. You’ve done much harder things in the past. Organizing your finances is one way to treat yourself well and gain back a feeling of peace in your life.

Wrestle Your Money To the Floor And Make It Behave

January 26, 2010 By Sherry Tingley

Do you have trouble managing money and making it do what you want it to do? Learn how to wrestle your money to the floor and make it work for you.

LendingTree.com conducted a nationwide poll that measured attitudes about consumer loans, credit card debt, credit scores, savings and financial plans. It was alarming that 48% of the respondents were uncomfortable with their household debt. Even more alarming was that 54% admitted they have no financial plan to become debt free. This clearly establishes the need for people to learn how to manage their debts.

The way money works in your household is more about emotion than about math. Financial advice needs to be written for humans, not robots. Life has unexpected events that you can manage and plan for.

Budget

You may have heard this a thousand times and you’ve either given up on the idea or you’ve found a way to budget that you can live with. One way to budget is to take a piece of paper and write your total monthly income. Under that write down all of your expenses in categories and guess what amounts they each are. Total this amount. Make sure your income and expenses are totally equal. You want to spend all of a month’s income on paper before the month starts. Spend all of it on paper. Don’t forget that savings is a category. Now you have ordered your money to behave because each dollar has a job to do.

Allow for Mistakes

You are going to make mistakes the first time. Don’t worry about that. You will get better and better at estimating your expenses. With practice your budget will become one of the most powerful tools available to you to keep your finances on track.

Dump Debt

Debt is your largest obstacle to financial security. Think about your current beliefs about debt other than your house and car. Debt is not something you just have to live with. Many people live debt free. So can you.

If you are living on borrowed money you can prevent digging a deeper hole for yourself. Mitlon Berle said, “It’s amazing how fast later comes when you buy now! Just stop using any borrowed money, which of course will include your lines of credit. Don’t close your accounts because there are situations that you need a credit card. Renting cars, securing a hotel or paying for a vacation will need some kind of credit. When you use them for that purpose and keep your balance at zero, then you are doing great.

Save Money

Saving and investing are two of the best things you can do with your money. If you watch the Suze Orman televsion show, you might think that everyone in the country may be better off than you are and that everyone has over $300,000 in savings for retirement. Well, take heart, because there are people who have no savings at all and who find it hard to save. Start with a small amount if you are having difficulties making ends meet. As your income grows and your expenses lower, then you can save more. Make it a habit to do this on a monthly basis.

“The safest way to double your money is to fold it over once and put it in your pocket.”
~ Kin Hubbard

Garage Sales

Get rid of items that you no longer need. Not only will you get some added income, but you will have more space to live.

Automatic Deposits

Use automatic deposits into your savings account. Sometimes it is less painful for people to save money when you don’t have to decide to do it every month. You make a decision once and then set it on auto-pilot. In six months to a year, you’ll have a nice amount of money saved.

“Money can’t buy you happiness but it does bring you a more pleasant form of misery.”
~ Spike Milligan

Effective Use of Credit Cards

December 1, 2009 By Sherry Tingley

Credit cards may be one of the most innovative and helpful inventions in the modern era. Through this little electronic card, we are able to make cashless transactions and online purchases. We are now able to live in comfort for credit cards make us think we can afford the finer things in life.

This is one of the advantages of having a credit card. The downside is that we also have to pay the banks interest fees for this service. People who do not manage their finances well can be charged high interest rates and huge penalty fees for late payments. This is a cycle they may never escape unless they seek professional assistance.

If you use credit cards regularly and you can control your spending, there are some ways you can get low interest rates. Read on and find out how.

There are essentially two paths you can take if you want lowered interest rates. The first one has to do with dealing directly with the credit card company. If this is not appealing to you, you can use the second option, which is to find a separate loan that has lower interest rate than your existing credit card rates.

In dealing with the credit card company, before you request a lower interest rate, you need to have a good credit rating. Remember that you can only qualify for lower interest rates if you have good credit scores. A good credit rating is an indicator that you pay your debts regularly and that they can rely on your monthly payments.

Now, if you want another way to go about this, you can approach other lending firms that are willing to offer you a lower interest rate as well. You can refinance your home loan. You may receive a lower interest rate because of this and it may allow you to pay off some of you high interest credit cards.

If you are serious about getting your finances in order and you instill in yourself a sense of discipline, there are a lot of ways for you to get the lowest interest rates possible. You should not expect overnight success when you are in search for a competitive interest rate, instead, practice some patience in the course of your research. Why not begin your search today? Call your credit card company or search the web for other options. There are numerous websites that can help you get started.