Are you one accident away from financial disaster? Many Americans are. It could happen as simply as a fender bender or a broken appliance, living paycheck to paycheck is financial imprisonment. So how do you break free from the shackles? MSN Money answers that question in their quest to change typical spending habits to financial freedom.
First and foremost, take some time and assess your current situation. Be honest with yourself and your spending habits and then make attainable goals. Now your really off and running and it’s time to make a realistic budget. Look at areas you can cut drastically like meals out and unnecessary trips to the mall. You can make huge changes by checking into auto and home refinance or dropping a car payment altogether for less expensive automobile. Start small and enjoy the rewards you reap. Don’t forget to stash those pennies with SmartyPig to cover that financial disaster, or just a vacation down the road.
Wishing you successful saving.
Sarah Foss, SmartyPig Media Mad Woman, SFoss@SmartyPig.com
A savings allergy? I’ve heard a lot of excuses about poor savings numbers, but that is certainly a new one. It’s not peanuts or dairy, so I agree with the financial folks at Mainstreet.com when they encourage us to spend some time this month and assess where you are with your savings goals: short-term, long-term, and everything in between.
This article reminds us that even if we are saving money each month, we’re probably not saving as much as we could. Are you still eating far too many lunches out? Daily lattes? New cars when they’re really not needed? Take a look at where your dollars are going each year. As we make our way to the middle of tax season, don’t forget to look at areas where you may find yourself with a refund. Those deductions could add up in a big way and start a nice safety net or vacation goal for your 2014 year. $10 here and $50 there make a big difference each year. It doesn’t take a lot of time, and you’ll thank me when you’re done. Explore your spending this month and start a new goal to reward yourself at the end of it!
Wishing you successful saving.
Sarah Foss, SmartyPig’s Media Mad Woman, SFoss@SmartyPig.com
Brian James is a financial contributor who writes and shares tips about banking, smart shopping, debt management, and more.
How did you fare during the recent holiday season? If you overspent on gifts or got a little out of hand buying drinks at the office Christmas party, you’re probably feeling the pinch in your bank account. Of course, there’s nothing you can do to change past spending mistakes. What you can do, however, is formulate a game plan for paying it off quickly. The following five tips can help you do just that:
1. Cut Your Monthly Service Bills
Call your Internet service provider and ask to drop down one connection speed – it typically saves about $10 per month. Next, check with your smartphone provider for a breakdown of your data usage for the past few months. If you can switch to a cheaper plan and still maintain your usage habits, do so. If you’re currently paying for insurance on your device but you tend to take care of it well, consider dropping it altogether or getting a cheaper insurance plan through a provider like SquareTrade. Dial up your satellite TV provider and ask for available discounts, as well. If you’re not locked into a long-term contract with any of these services, search the Internet for bundled deals that include all three, usually at a lower price.
2. Reduce Grocery Expenses
There are a variety of ways to cut your grocery bill. Switch to a diet that includes more fresh fruits and vegetables, which are cheaper than meats and processed foods. Clipping coupons is a tried and true method, as well. In addition to the Sunday paper, there are a wealth of grocery coupon apps for your smartphone such as Favado and Pushpins. Start creating a weekly menu for your household, then shop with a list based specifically on it to prevent yourself from overbuying.
3. Temporarily Suspend All Personal Purchases
People tend to think being in debt means making lifelong, permanent sacrifices. That just isn’t true. Figure out a pay-down time frame for your holiday debts and commit to not buying anything for yourself until the balances are gone. In all likelihood you can get rid of that debt over the next several months so holding off on personal purchases for that time period shouldn’t be too difficult.
4. Commit Cash-Back Bonuses to Credit Card Debt
If you racked up a bunch of holiday credit card debt, chances are you did a good job on cash-back rewards, as well. Skip the urge to redeem them for travel or other purchases and take them in the form of a statement credit until your debts are gone.
5. Refinance Your Home Loan
Current mortgage interest rates are still low, so find out what you’re paying and see if you can save by refinancing. Start with your current lender – you may be able to get an attractive rate, plus you could save on closing costs. You could also consult with friends and family for recommendations on a mortgage refinance specialist or use the “Find A Pro” tab at the Zillow website.
Once your holiday debts are gone, consider a few strategies to help prevent you from ending up in the same boat next year. Open up a separate bank account and have a nominal amount from each paycheck deposited there to be used specifically for this year’s holiday season. Keep your eye out for sales throughout the year and if you see a stellar deal on something you know would make a good Christmas gift, pick it up. Overspending during the holidays is an easy mistake to make, just make sure you learn from it so you can avoid it ever happening again.
What ideas do you have for paying off holiday credit card debt?
I started saving for my “wedding” with SmartyPig a few months after meeting Matthew. I say, “wedding” because at the time it seemed like a hypothetical possibility, but 12 weeks into a relationship you just never know. Well, except I did know. Matthew didn’t know about the goal, and I didn’t contribute a lot at first, $20 here and $50 there. But before long I had almost a $1000 in there and we weren’t even engaged! Just a few months after that, and 12 months into our relationship, he popped the question. I of course said yes, and then the real stress set in: wedding planning stress.
I’m older, so asking my parents to fund my wedding felt funny. I knew I didn’t want a big celebration, something small, but even so, that would be expensive. Turns out, Matthew was also saving money for our big day. I convinced him to move his funds to SmartyPig and 2 years later we were both close to having enough money to fund our small, back yard wedding.
Thanks SmartyPig! You started our lives out on a great note!
In today’s economy, emergency funds are a hot topic. How much do you really need? Three-months expenses? Six? The Simple Dollar blogger, Trent Hamm, writes about his quest for a twelve-month safety net. Hamm is wildly popular among people trying to find their way in the world of fixing finances, and he received lots of feedback, including many who think his fund may be “too much.” But his personal situation, which includes young children, made this larger-than-norm safety net appropriate – for him. Hamm suggests your safety net is an amount you should set for yourself. Whatever makes you feel, well, safe.
With just one young child and few large expenses how much do I need? Yahoo Finance helps to answer. This handy calculator takes more than just the baseline gross income and large expenses that many calculators suggest, and asks for the whole enchilada, including the not-so-obvious bills: household repairs, co-pays, hobbies and so on. The calculator gives you a time frame and deposit options, as well. And once you calculate your safety net needs, give those dollars a home at SmartyPig and be on your way to an emergency fund quickly and painlessly.
Wishing you no emergencies.
Sarah Foss, SmartyPig’s Media Mad Woman