Navigating Inflation: Money-Saving Tips for Young Adults

Hey there, young adults! I know that dealing with money can sometimes feel like diving headfirst into a whirlpool of confusion. And now, with inflation hitting us, it's even more essential to get a grip on our finances. So, let's chat about some practical tips to help you handle budgeting and financial decisions during this time of inflation. Consider me your friendly virtual parent giving you some sage advice! 

Budget Like a Pro: The first step to financial stability is setting up a budget. List down all your monthly expenses, including rent, groceries, transportation, and entertainment. Once you see where your money is going, it becomes easier to allocate funds wisely.

Emergency Fund is Non-Negotiable: We can't predict emergencies, but we can prepare for them. Try to save at least three months' worth of living expenses in an emergency fund. It'll give you peace of mind and financial security during tough times. You just have to make sure you do not touch it. 

Cut Back on Non-Essentials: Evaluate your spending habits and distinguish between needs and wants. It might be time to reduce those frequent takeout orders, streaming subscriptions, or impulse purchases.  Saving a few dollars here and there adds up over time. 

Shop Smart: When grocery shopping, look for sales, use coupons, and consider buying generic brands. It really helps a lot to have your most frequented grocery store app on your phone. Planning meals and making a shopping list can help you avoid impulse buys and save on food costs.

Track Your Expenses: Apps can be your best friends when it comes to tracking expenses. There are so many free ones available that can categorize your spending, making it easier to spot areas where you can cut back.

Invest Wisely: Inflation erodes the purchasing power of your money. To combat this, consider investing in assets like stocks or real estate. While these carry some risk, they historically outperform inflation in the long run. Of course, this might not be an option if you are just starting out on your own. 

Pay Off High-Interest Debts: High-interest debts, like credit card balances, can eat away at your finances. Prioritize paying them off as quickly as possible. It will definitely take time, but be patient and try to pay more than the minimum payment on any credit cards you may have.  The interest you save will be money in your pocket. 

Automate Savings: Set up automatic transfers to your savings account right after payday. This way, you won't even see the money you're saving, making it less tempting to spend it. This is also a smart move for life insurance, but that's another post for another day. 

Consider Side Hustles: If your primary income isn't covering your expenses, consider taking on a side gig. Freelancing, selling crafts online, or tutoring can bring in extra cash to help you stay afloat. You might even have items that you can sell on Facebook Marketplace or eBay to make some quick cash. 

Stay Informed: Keep an eye on economic news and government policies that may affect your finances. Being aware of changes can help you make informed financial decisions, especially if you have student loans. 

Invest in Your Skills: Learning new skills or furthering your education can increase your earning potential in the long run. Consider investing in courses or certifications that can boost your career. Some places of employment might even pay for courses relevant to your job. Be sure to inquire before enrolling in classes or courses. 

Plan for Retirement: It's never too early to start saving for retirement. Contribute to your employer's retirement plan, and if possible, open an individual retirement account (IRA). Compound interest will work in your favor over time.

Seek Financial Advice: If you're unsure about your financial strategy, don't hesitate to seek advice from a financial advisor. They can help you create a personalized plan based on your goals and current financial situation.

Be Patient and Stay Disciplined: Achieving financial stability takes time and discipline. Don't be discouraged by setbacks or slow progress. Keep your long-term goals in mind and stay committed to your financial plan. If you have the opportunity to live with parents or family members at a low cost, this is an excellent thing to take advantage of to get your finances in order. 

Remember, we're all in this together. Inflation is a challenge, but with smart financial decisions and a little determination, you can weather the storm. Just like a parent would, I want to see you succeed and build a secure financial future. So, go out there and take control of your finances, and don't forget to treat yourself once in a while – you've earned it!

The Average American Family Spends $240 on Airport Food & Drinks due to Flight Delays

Travel Snack Surtax: The average American family spends $240 on airport food & drinks due to flight delays, reveals data. This is equivalent to 26% of their flight ticket costs. Families flying out of Delaware airports spend the most on food & drinks.

Airport Armageddon: A surge in flight delays this summer has created chaos in airports around America, with the delay domino effect leaving travelers spending more time (and money) inside airports while they await their unpredictable departure. Airports are infamously renowned for their massively marked-up food and drink charges. In fact, an outrageously-priced $28 beer from a vendor at LaGuardia Airport recently made headlines due to its alarming cost. For passengers on standby (and who perhaps weren’t expecting to spend much money at the airport), flight delays can result in unforeseen, but unavoidably exorbitant, purchases of meals, snacks, and drinks. This can rack up significant costs – especially for traveling families – and particularly so if there are specific dietary requirements that are necessary.

FamilyDestinationsGuide.com analyzed flight data, including the average air ticket fare* per family**, in each state to determine how much more of families’ vacation budgets are being eaten into (literally) by flight delays. This found that overall, the average family flying out of airports across America spends the equivalent of 26% of their flight ticket costs on food & drink surcharges alone, while awaiting their departure – that’s $240.51! 

When analyzed by state, Delaware airports were found to have the highest figures for families in terms of additional food and drink costs: the average family spends 87% of their flight costs on these purchases. By comparison, those flying out of airports in Alaska spend 16% of their flight costs on travel snack surcharges. 

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Why Should Parents Save Money for Their Children?

Although your children might still be very young, time with them seems to pass quickly. It may feel like no time has passed, yet soon they will reach their next birthdays, milestones, and, eventually, adulthood. Putting money aside for your child, no matter how small an amount, can help them to make a good start in independent living. In addition to this, the earlier you start a savings account, the more time it will have to accrue interest on top of the amounts that you deposit.

Education

While your child’s mandatory schooling years may not come at a cost, higher education usually involves student loans, or upfront payments, unless your child is eligible for a scholarship. Something like a master's degree in speech language pathology could possibly help your child to advance in their career, but may not be something they would consider without a form of financial backing. Putting money away each week or month, even when they are a baby, can help to contribute towards tuition fees, as well as any other materials they might need to complete their course. Even if your child doesn’t want to gain a higher education, there may be other types of education they wish to pursue, or even tools they might need to gain employment in a certain career.

First Car

When your child reaches a certain age, they may want some level of independence while still living within the family home. Being able to pay for driver’s education, as well as a cheap first car, may be difficult to achieve, especially if your child has many school commitments that prevent them from taking on more hours at a part-time job. Lessons could be taken over an extended period of time, or in a single, intensive course. Having some money put aside can help your child to gain this extra freedom. Of course, they will still have to find the money for gas for the car, but at least you can rest assured that you have helped them along the way.

First Home

Your child buying their very first home may be decades away, but that doesn’t mean it is something that shouldn’t be thought about. The down payment for a home can vary, depending on where you live, as well as the average house price at the time, and even due to the income you have. This can be very difficult for anyone, so you may want to try to ease the burden on your child as much as possible. If they have even a percentage of the money towards the down payment of their home, this can cut down on the length of time it will take to save up for the rest of the amount.

Putting money aside during the early years doesn’t mean your child needs to go without in the present. By figuring out how much you can feasibly put aside each month, a little nest egg can be built up over the years which will make your child’s transition to adulthood that little bit easier.

Teaching Your Child About Money

As a parent, you want to make sure that your child has every opportunity available to them for the future. While you may spend time discussing manners, and the importance of education, it can also be incredibly useful for them to understand how best to manage and use money, including in the distant future. Starting this as soon as possible can really help them to understand the importance of being smart with money, as well as how vital it can be to save rather than spend. 

Pensions

Your child is only at the beginning of their life, so you may wonder what the point is of discussing this far into the future, but it can really help them live a full life. By instilling the need for a pension in your child, they could understand the importance of money in retirement that bit more, and may also opt to hold a private pension - for more info click here, as well as one that their company might provide, to give them a bit more financial security later on in life. One of the ways you could potentially educate them on pensions is to show them your own pension statements or accounts, as well as the amount you pay into it each month from your standard pay check. 

Budgeting

Having knowledge about how to budget, and what it means, can also help your child to correctly manage their money throughout their life. Alongside making your money stretch to meet your needs, these lessons can also aid them in learning to save. This can be accomplished through the use of a weekly allowance, that they could earn via chores, good behavior, and other tasks. If they then see something they wish to buy that is more than their allowance, your child must then learn to put the money aside themselves to afford it. While it can be tempting to buy the item for your child, this won’t help them to learn to become financially independent.

Resisting Impulses

Many people, adults and children alike, fall prey to temptations and impulses on a daily basis. While some may not really affect a person’s life, others can lead to serious debt, as well as potential health problems. At points, these impulses could be used as a means of reducing negative emotions, which is not a healthy coping mechanism. Equipping your child with the tools they need to avoid impulsive purchases, such as the method where you wait a few days and then, if you still want the item and it is within your means, you could permit yourself to purchase it. Impulse purchases can become a real problem if left unchecked, especially when it means that bills or rent can no longer be paid. Finding healthy ways to avoid these, as well as to manage emotions in general, can really help to prevent these consequences from occurring.

The younger a child is when they start to understand the necessity and importance of money, the more likely they may be to have respect for their finances. Keeping your child informed, and using your own finances as an example, can really go a long way towards their own future financial stability.

Take Control of Your Finances in 2021 with These Helpful Ideas

When it comes to our finances, it can feel like we’re in a vicious cycle of spending and debt. It’s not always easy to maintain our current lifestyles and more of us than ever before are stripping back on luxuries as a way to keep control of our spending and keep debt at bay. But, there must be another way to take control of your finances, right?

Managing your money doesn’t always have to mean cutting back on the things you love. Sometimes, simply revisiting your budget is an easy yet effective way to see how you can hold onto more of your money each month. If you’re someone who is really struggling with their debt and is facing potential bankruptcy, reach out to Creditfix as soon as possible to discuss your options with one of our helpful and experienced advisors. 

Why not make this new year the one you finally gain control and build your financial confidence? Read on for how you can take control of your finances in 2021. 

Create a rainy-day fund

When we’re prepared for the unexpected, we have one less thing to stress about. And the same logic applies to your finances. The more ready you are for those financial mishaps and expenses the better you’ll sleep at night. Start by creating a rainy day fund and make sure you’re including it in your monthly budget expenses. 

How much you can afford to place in your fund is up to you, just remember to add to it! Sudden car repairs, broken appliances, a job loss or change in your living circumstances could have devastating consequences for your finances, plunging you into a spiral of debt that may be difficult to get out of - a rainy day fund gives you a much-needed safety net. 

Update your knowledge 

Unfortunately, financial literacy isn't taught in schools. Which means most of us hit adulthood with little knowledge of how to create a budget, handle money, prevent debt, or apply for a mortgage etc. Updating your financial knowledge by reading articles and even listening to podcasts on certain financial subjects can give you the information you need to make better financial choices in the future.

Pay off those credit cards

Credit card debt can hang over us for months and even years, making it difficult to break the never-ending cycle of debt. By paying off your credit card debts as soon as possible, you won’t be stung by rising interest rates and only pay off what you originally borrowed. Again, reach out to Creditfix if you need further guidance.

And finally, set a savings goal

Want a new car? Or do you have dreams of owning your own home one day? Whatever your financial goals may be, the sooner you start saving for them, the better. This savings goal should be separate from your emergency fund, however, it will also provide an additional financial safety net should you need one. Don't forget to include your savings in your monthly budget. 

5 Ways Parents Can Teach Their Kids Important Money Lessons During the Holiday Season

The holiday season is especially fun for kids, but it also provides parents a great opportunity to teach their little ones important lessons about money. What are the best ways mom and dad can do this without their children losing interest?

Steve Siebold is a Certified Financial Educator (CFEd) and author of the book “How Money Works,” which is written on a level that even children can understand the basics of money. www.howmoneyworks.com

His 5 tips to help parents better explain money to their kids this time of year:

Invest any money they are gifted: When your children receive checks from relatives far away or if you decide to gift your children money as a holiday present, don’t just put it away in a savings account that will yield practically no interest. Teach them to invest their money so it can work for them. Show them the different places they can put that money, the potential for growth and risk for loss.

Let them get involved with budgeting: As you do your holiday shopping this year, involve your kids. Let them see how money work, how you create and stick to a budget. Explain to them the benefits of a budget, and how it prevents you from overspending. Be frank with them and show them that if you go over a budget, it impacts other important things you need money for.

Explain wants vs. needs: The holiday season is a great time to explain to your kids the difference between wants and needs. For example: they might want a Play Station 5, a new iPad or that new bicycle. Let them know a need is something like clothes, food, a place to call home and a bed to sleep in. Explain that there’s nothing wrong with “want” gifts, but that needs always supersede wants.

Teach them to think before spending: One of the biggest reasons so many people struggle with money is because they don’t think before they spend. That’s even more so during the holidays because Madison Avenue does a good job of convincing us of all the things we supposedly need to buy. Teach your kids to stick to logic when it comes to spending this time of year, and to leave their emotions on the shelf.

Teach them it’s better to give: Most children love waking up on Christmas morning to open up all those gifts under the Christmas tree. Use the holiday season to also teach your kids the importance of giving. Explain to them how it’s nice to help others in general, but especially this time of year. One of the greatest lessons you can share with your children is purchasing a gift for a child who wouldn’t otherwise receive one this holiday season.

Financial Planning For Families Is Easier Than You Think

Do you often worry about your financial future? You are definitely not alone. Most Americans have significantly low savings while having a pretty high debt load. Being in debt can definitely keep you up at night. Don't worry, you are not alone in this! Since the pandemic started earlier this year, many people have been taking a closer look at their finances, and retirement plan. 

What do you do when you don't know how to even get started? 

One of the first things you can do is clean your house. How does cleaning your house help, you ask? Going through your belongings can unlock a treasure chest filled with money that you didn't realize you had. We all have extra stuff hanging around the house that we don't use, so selling those items online or at local consignment shops can put cash in your pocket pretty quickly. You can use that cash to start a family emergency savings account. This would be an account that you do not touch since it is strictly for emergencies. Having an account that your whole family can contribute to means your available balance will add up quicker.  

What do you do if you are in a lot of debt?

That is a hard and stressful time for many, but there are ways to dig yourself out of debt. You don't realize how much you spend each week on little things that you really don't need. I know I have had this habit over the years. You see what you think is this 'great deal' that you better scoop up while you can, but you really can live without it. I know, I know, you probably feel like it takes away from you enjoying life while you can. The thing is, that $10-$20 item could have been added to your monthly credit card payment or toward paying down the principal on your mortgage. 

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You are probably thinking that such a small amount isn't going to help much, but believe me, it adds up! You should really take a look at the many free resources that's out there just waiting for you to take advantage of. Getting out of financial problems is possible with a little bit of discipline and taking the time to get organized. It's especially important to be more financially conservative during these uncertain times. After all, the pandemic isn't even close to being over. Do all you can to save, save, save! 

Thank you so much for stopping by today. 

Understanding Reverse Mortgage Talk

Retirement is supposed to be a fun and relaxing time for people. If you don’t pay attention to the financial side of things in the years leading up to it, you could find yourself in a rough spot when that time arrives. A reverse mortgage is one of the most sound ways of getting around the financial strains that come with retirement. When you first start investigating, there may be some terms and concepts you are not familiar with. Do not panic! We want to help you by breaking down the basics. 

Finding the value of your home

During the duration of your home ownership years, you most likely will make improvements to your property. This is one of several factors that could influence the overall value of the home. Others might include how old the home is, whether or not the area the home is located in is considered desirable, and if you still have an active mortgage on the house. 

Understanding a Reverse Mortgage Calculator 

The reverse mortgage calculator is a central component of the reverse mortgage application process. It is a subjective way for the bank (or any other lender) to determine how much money you can borrow in the form of a reverse mortgage. Because government has implemented laws that prevent you from borrowing the full value amount of your house, the reverse mortgage calculator will help to determine what percentage of that you will be able to borrow. It calculates the value and the applicable percentage.

But what is an HECM, then?

The concept of reverse home loan comes down to the fact that the surety of the bond is linked to your house, and that the loan can provide you with a source of money each month for as long as you choose to live in the house, as opposed to a traditional loan, where you would have been liable for paying the loan back in monthly payments during the course of its validity. 

HECM is very similar. It stands for home equity conversion mortgage, and it is also a reverse loan, but what makes it different is that it is issued by a federal agency and not by banks. The chief difference is that an HECM is insured by government, whereas a privately-issued reverse mortgage is not. 

Receiving your reverse home loan money

One of the most popular ways of doing this is to take it out as a line of credit. Another is to opt for being paid out all in one go, as a lump sum payment. There is also the option of taking receipt of your money in the form of monthly payments of equal value. Many people like this option, as the prospect of a predictable amount coming in monthly gives them a way to budget these funds. Of course, the same applies as if you were drawing a regular salary: you’ll have to keep your spending in check to prevent running out of money!

4 Types of Loans

Sometimes, you just don't have the funds to pay for something you really need. Almost everyone is familiar with credit cards, auto loans and mortgages, but there are all kinds of loans out there that cater to specific situations or needs. These four loan types are only a few.

1. Personal Loans

A personal loan is very versatile. You don't need collateral to apply for one like you would for an auto loan, and you can use the loan for a wide range of expenses, from home renovations to an engagement ring.

This type of loan works best for someone with a good credit score because you're more likely to get approved and receive a lower interest rate. You can apply for a personal loan with most credit unions and banks, and with some online lenders.

2. Home Equity Loans

If you own a home, you can get a home equity loan by borrowing against the equity, or the amount of your home you own. If you've paid off a third of your mortgage, you can borrow up to a third of your home's value. People who opt for this type of loan are usually doing something to improve the quality of their home, like renovating the kitchen or building an addition.

Home equity loans tend to have lower interest rates than some other types, but like with a mortgage or auto loan, there is collateral involved. In this case, your house. Collateral can be a risk because if you default on your loan, you could lose your home.

3. Student Loans

These loans are increasingly common in the United States. Most college graduates can expect to carry roughly $40,000 in student loan debt, at least. Many people today include student loan payments in their budgets, along with more traditional bills like rent and utilities.

Since 2006, all federal student loans have fixed interest rates. Every student applying to colleges should fill out a FAFSA (Free Application for Student Aid). This application provides the government with the information needed to award federal loans and even grants based on the student's financial need. There are also private student loans available through institutions like banks.

4. Debt Consolidation Loans

A debt consolidation loan is a way to provide debt relief. This type of loan merges various bills into one debt that you can repay as one bill, to one lender. This type of loan is best for things like paying off credit cards, which typically have higher interest rates. If you decide to take out a debt consolidation loan, it's important to figure out the total you must pay for all the bills you want to merge and compare it against your budget. A lender can then help you figure out the best plan and interest rate to pay off your bill. Typically, the repayment period is about 3 to 5 years.

These are only some of the different loan types available. One of them might work for you, or another type all together might fit your needs better. It's important to do your research when considering a loan.

Here’s How You Can Ease Stress and Improve Your Finances

Money might make the world go around, but it’s also one of the most stressful things that we need to deal with as adults. When you’re growing up as a child, you have no idea how much cash is going to affect you when you get older. Then, as soon as you start your first job, it feels like all of your time is committed to thinking about how you’re going to make your money stretch as far as possible.

The important thing to remember is that you can always find ways to reduce the amount of stress involved with managing your money. With the right attitude and a little planning, you can improve your finances and set yourself up for a brighter tomorrow. Here’s how you can get started.

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Deal with the Debt Situation

People often struggle with different relationships with debt. We know that not all debt is bad for us. Sometimes, the right personal loan can help you to accomplish an important goal, like completing your online training for a new job or getting a car to take you to and from work. However, sometimes, if you don’t know how to deal with it, debt can hold you back too.

Think about how you’re going to banish unwanted debt as quickly as possible in the months and years to come. Can you consolidate old debts into a new and more affordable loan. Maybe the debt snowball method will help you to get things sorted a little faster.

Reduce Your Grocery Spending

It seems strange that we would recommend cutting the amount of money you spend on something as essential as food. However, if you look at your monthly incoming and outgoing cash, you’re likely to be blown away by how much you actually spend on groceries. A lot of the time, the problem will be that you’re not just buying the essentials, you’re grabbing snacks that you never eat, or paying for brand-name items that are just as good as the cheaper options on the shelf.

One way to reduce you’re your grocery shopping expenses is to plan your meals each week before you go shopping. Take a good look at what you’re going to need, and don’t buy anything else – no matter how tempted you are.

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Stop Automatic Subscriptions and Memberships

Subscriptions and automatically renewing memberships are easy to sign up for, but difficult to cancel. If you’re using your subscription every week without fail, then there’s no problem with keeping it – as long as you can afford it. The problem is that a lot of us continue to pay for memberships that we’re not actually using just because we forget to cancel them.

For instance, maybe you signed up for a gym membership in January with every intention of going to workout every week. However, if you’ve only been to the gym once since then, maybe it’s time to rethink your strategy. Look through your bank statements and highlight any of the subscriptions you’re not using regularly.

Spend Your Extra Cash Wisely
Those moments when you end up with extra cash in your bank balance might be rare, but they’re also moments that you need to work out how to use to your advantage. Whenever you work overtime at work and get a bit of bonus income, think about how you can put it to good use by building up your emergency savings fund or getting rid of some of your extra debts. Putting your cash into savings as soon as you earn it might not seem like the most exciting thing that you can do, but it will help you to get rid of some of that pesky stress that you feel whenever you think about money.

As fun as buying a new computer game might seem right now, it won’t compare to the feeling of reassurance you get when something goes wrong with your home, and you remember that you have some extra cash in your emergency funds.

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Reduce Energy Costs

Saving money on your energy bills is one of the easiest way to reduce the amount of cash that you waste each month. What’s more, the process can be as simple as just making a few basic tweaks to your regular routine. For instance, you might be able to take slightly shorter showers, or washing your clothes in cold water.

Energy efficient appliances are another excellent way to save money on your electricity if you’re thinking about upgrading anyway. Consider the benefits of spending more now to save later.

Tips to Help you Cut your Tax Bill

If you receive an unexpected tax bill it can potentially bring on a lot of stress. There are a few things you can do to cut your bill legally. However, you might need to put a bit of effort in but it could be worth it.

Photo by Sabri Tuzcu on Unsplash

Adjust your W-4
This is the form that you need to hand to your employer. This form tells them how much tax they need to withhold from each pay check.  If you have a big tax bill looming, you might be able to raise the withholding until the next tax year.  If you received a large refund, you could reduce the withholding. This will mean you’re less likely to be living on less money.

Fund an FSA
Did you know that when it comes to your personal taxes you can add tax-free dollars to your FSA every single year? If your employer offers you a flexible account you could use it to your advantage. The latest limit is $2,700 and some employers might allow you to carry around $500 over to the next tax year.

Save Money for College
If you would like to save money so your child can go to college, you could potentially reduce your tax bill. Consider making contributions to your 529 plan. You won’t be able to deduct the contributions on the federal income taxes. However, you could deduct them on your state return. This is only the case if you are putting money into your state’s plan.

Photo by Sharon McCutcheon on Unsplash

Record Your Medical Expenses
If you have had dental care or expensive medical treatments, you should keep hold of your receipts. You can deduct any expenses that are 10% or more than the adjusted gross income for that year.  Let’s imagine that your income is $50,000. You would be able to deduct anything beyond the first $500.

Work on Your Timing
There can be a huge difference between doing your taxes on the last day of December and the first day of January. If you think you have an expense looming try to pay it this year rather than the next. So, for example, having that tooth extracted now means you could meet the medical expenses threshold. If you were to wait until next year you could lose out on your deductions.

Donate Your Money
When you donate money to charity those contributions are often times deductible. What’s more, is those donations do not always have to be in cash. If you have donated household items, food, or clothing you could have a lower tax bill. However, you will need to make sure that you got a receipt for your donations and they went to a recognized charity.

It is possible for you to reduce your tax bill, you just have to take some extra steps. By implementing those things, it can lead to you paying less in taxes every year. Follow the above tips and you’re less likely to get an alarming tax bill.

Getting Back on Your Feet: 7 Tips for Getting out of Debt Fast

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Although many of us might prefer to take things one day at a time, our financial future is important. It’s not always about how much we make, but rather, how we spend and save the money we already have.

However, since the introduction of credit cards and loans, many individuals around the world have been spending not only more than they currently have in their bank account but more than what they can afford to pay back in time. In fact, just in America alone, the amount of debt Americans accumulated in 2018 hit a record of $13.21 trillion.

While the whole “buy now, pay later” approach to purchasing a product or service is something we can all take advantage of, the deeper we dig ourselves into debt, the worse the consequences. High-interest rates, a declining credit score, and heavy stress are just some of the disadvantages.

If you’re looking to get rid of your debt fast, you’ve come to the perfect source. Try some of the following tips to help get your finances back in order.

Photo by Sharon McCutcheon on Unsplash

1. Start budgeting
Not everyone with debt is bad with their finances. Regardless, it’s a good idea to put yourself on a financial budget. This way, you can ensure your income is enough to cover not just your bills but other necessities in your life including food, gasoline or other transportation costs, and other vital expenses.

To start a personal budget, you must first decide how much you spend on a monthly basis and where exactly that money goes to. From then, you can figure out what percentage of your income should go to what. Ranking your expenses from most to least important is also a wise idea to get a better understanding of your finances.

2. Try the debt snowball method
Many people have tried the debt snowball method of tackling debt and found that it works for them. It might just work for you as well. This five-step technique involves listing all of your credit card debts in terms of the amount owed and paying off the smaller debts first, especially the ones with the largest interest rates.

Over time, you’ll notice that the number of debts you have will diminish faster. On top of that, seeing how quickly these debts are diminishing will psychologically act as a motivator to get rid of those bigger, peskier debts. It’s usually not until you see this progress that you feel more encouraged to continue doing what you’re doing.

3. Downgrade your vehicle
When you’re deep in debt to the point where you can hardly keep up, one of the quickest ways to tackle such is to sell your current vehicle and then use part of that profit to purchase a cheaper, used vehicle while using the rest of the money to pay off debt.
Especially if one has a newer vehicle they’re still paying off, one might simply sell this vehicle altogether to get rid of their monthly auto payments and wait until a more financially-feasible time to consider purchasing another vehicle.

Photo by JESHOOTS.COM on Unsplash

4. Pay more than your monthly minimum on your debts
There’s no rule that says you must pay exactly your bills’ monthly minimum payments each month. In fact, there’s a reason why they’re called monthly minimums: because that’s the minimum, not the maximum, payment a lender expects you to pay by a specific due date.
However, if you currently have the cash to do so, it’s a good idea to pay more than your monthly minimum payment, even if it’s just $10 more each time. Every dollar counts and the extra you pay off adds up over time. This is an especially great tip if some of your debts are already close to being paid off.

In the end, you could end up not only getting out of debt quicker but saving more money in the long run. Meanwhile, the more you drag on paying your dues over time, the more interest you’ll end up having to pay.

5. Go through your belongings, and sell what you don’t need
As hard as it might be for some people when you have debts to pay off, chances are, you’ll be needing more money to do so. Some folks may be left with no choice but to go through their stuff and sell what they no longer want or need. Unwanted clothing, old furniture in the basement, and extra home decor are all things you might want to sell.

These items can be sold in person at garage sales, directly sold to family members or friends, may even be sold online.

6. Cut the luxury expenses
Every one of us has some sort of luxury expenses whether it be getting our nails done every few weeks or going to the movies every Friday night. Even going out to dinner versus eating on a budget at home can be considered a luxury expense.

Your job is to figure out which luxury expenses you’re paying for and deciding which are the least important. As you’re paying off your debt, temporarily cut off some of your luxury expenses, that is, until you’re financially able to get back on your feet.

7. Consider consolidating your debt
If you have a lot of debt to tackle and several different payments to make on a monthly basis, debt consolidation can be a great way to get out of debt quicker. With just one due date per month, smaller monthly payments, and a lower interest rate, debt consolidation might just be your go-to option for obtaining better finances.

Do you need help getting out of debt as soon as possible? Get help at debtconsolidationnearme.com.

Conclusion:
At some point, most of us will have to use a credit card, take out a loan, or even occasionally borrow money from family members or friends. However, there comes a point where the amount of borrowing we do starts to pose significant problems.

No matter how much debt you’ve accumulated so far, the good news is, you can start tackling it now. From creating a financial budget to considering consolidating your debt, there are numerous ways you can quickly banish your daunting debt to lead a more financially-sound life.

Exploring Your Potential Reverse Mortgage Candidacy

Retiring is not always fun. It can be stressful when you have worries about your income. However, if you own your own home, you may have an easy way to increase that income, at least temporarily. It is called a reverse mortgage. It is a non-traditional home loan designed solely to help retirees or people of retirement age stay in their homes while having money to spend in their golden years. Here is what you need to know about reverse mortgages and how to determine your candidacy for them.

You Must Meet Basic Reverse Mortgage Requirements

There are some basic requirements for getting a reverse mortgage. The biggest is that you must be retired or at the age of retirement. That minimum age is 62. The reason for that requirement is a reverse mortgage is a specific type of mortgage designed to allow retirement comfort without the hassles associated with traditional home loans. Reverse mortgage lenders do not offer reverse mortgages to younger homeowners.

Another requirement is you must own and live in the home. You cannot apply for a mortgage on a building you own while residing elsewhere. That means vacation homes are ineligible for reverse mortgage assistance. If you do own your own home, you must also prove your ability to continue to maintain it, such as by making tax payments. That is because you still own the home throughout the reverse mortgage process.

Your Home Must Have Enough Value to Get a Reverse Mortgage

Another issue affecting your reverse mortgage candidacy is you must own a home with enough value for the loan to work. A reverse mortgage does not allow you to access your full home equity.

A calculator for reverse mortgages determines the portion available to you. The tool is necessary because there are federal restrictions in place governing reverse mortgages. The calculation tool can also help you simplify the process of figuring out the total value of your home. That process involves assessing factors such as its age, size and geographic location of the structure.

You Need to be Prepared to Pay Reverse Mortgage Fees and Interest

A good assessment doesn't guarantee a reverse mortgage is right for you. The amount the reverse mortgage calculator authorizes you to borrow is not the amount you must pay back. You need to understand there are closing costs and fees to be paid. Those are deducted up front before any money is issued to you. More importantly, your reverse mortgage will also accumulate long-term interest. With each passing year, you will owe more back than when you started. Therefore, you must consider your ability to pay the interest back when deciding whether to sign the initial loan agreement.

You Cannot Maintain Two Mortgages at Once

Another thing you need to know before you get a reverse mortgage is you can get one while you have a traditional mortgage. However, you cannot maintain both for a long period. Shortly after signing a reverse mortgage agreement, funds must be removed from the total you are allowed to borrow. Those funds are used to pay off the traditional loan right away. The remaining funds are available to you to make your retirement more financially comfortable.

If the amount you can borrow and the amount needed to pay off the first loan are similar, you may not want a reverse mortgage. The best scenario is using the reverse mortgage to pay the first loan and still have enough left over to spend for other purposes. That can allow you to get out from under your ongoing mortgage bills and get some actual financial relief.

Teaching Your Kids About Money

Do your kids know that money doesn’t grow on trees? Here are some helpful tips for each age group.

You don’t have to wait until your kids are teenagers. You can start talking to them about the basics of money as early as preschool. Here are some tips about how to talk to your kids about money at any age:

• From ages three to five you can teach kids that money can be exchanged for things. Explain to them the difference between pennies, nickels, dimes and quarters.
• From ages five to nine you can start giving them an allowance. This is also a good time to explain bank accounts and what it means when a bank account earns interest.
• From ages nine to 13 you can help them open a savings account. Encourage them to save their allowance towards a goal (a new toy or a DVD). You might even consider setting up a matching savings plan like most companies do with a 401(k). This is also a good time to start talking to them about the idea of keeping a minimum balance based on the savings account requirement. You can also introduce the concept of keeping savings in case of emergency. Even though they won’t need to pay for an emergency at such a young age, you can explain the importance of keeping a nest egg.
• From ages 13 to 15 you can expand your children’s allowance to include more expensive items like clothes or gifts for friends. This is also a good time to introduce entrepreneurship. Encourage your kids to earn their own money with jobs for neighbors and friends.  Arrange for them to have an ATM card so they can withdraw money from their savings account.
• From ages 15 to 18 and up you can help your children open a checking account with a debit card. Teach them how to manage their account online or with mobile banking. You can even go old school and show them how to use a check register. This is also a good time to talk fiscal responsibility about when they go off to college. Be very clear about what expenses you will pay for which ones they will cover.

Explaining money management to your kids can start out with something as simple as giving them an allowance. If you talk to them regularly, teach by your own fiscally responsible example and give them the right tools, you will do more than teach them about money basics. You will instill in them a respect for earning and saving money that will hopefully set them on a path to being financially independent and responsible in adulthood.

5 Things No One Told You About Shopping for a Home

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Buying a new home is exciting, but if you’ve never gone through the process before, you may be in for a big surprise – and probably more than a few. When you aren’t experienced with the ins and out, your excitement can quickly turn into frustration. The National Association Realtors recently released some of the latest numbers related to home-buying transactions showing that of all homebuyers, 34% are purchasing a home for the first time. If you’re thinking about becoming a part of that statistic, knowing what most were never told about shopping for a home can prevent learning the hard way.

It’s Going to Cost You Lots More Than You Think

If you’re renting, paying say, $1200 a month, plus perhaps utility costs, you have a pretty good idea of what you have to pay each month. If utilities are included, you know exactly what you’ll be shelling out when rent is due. But when you’re shopping for a house and the lender says the mortgage payment will be only $1400 a month, you might think, “Well, that’s only $200 more, I can easily handle that.” But you’re wrong. There are lots of other things to consider in addition to that payment plus utilities. You’ll need to pay for homeowners insurance, maintenance and repairs (something that’s inevitable), property taxes, and perhaps home association dues and even appliances.

That makes it difficult to determine your exact monthly costs as you never know when something is going to break, and there’s no doubt that total figure is going to be a lot more than just the mortgage payment.

You’ll Need to Limit Your Credit Card Use

Before you start shopping for a new home, you’ll need to hold off on purchasing any big items on credit cards, opening any new lines of credit, obtaining a car loan, etc. In fact, the more you can pay down your debt the better as the ability to get approved for a mortgage, and a good interest rate depends largely on your credit score.

Even If You Don’t Have Kids or Plan on Having Any, Considering Are Schools is Important

Singles and couples who don’t have children and don’t plan to often overlook the schools in the area when shopping for a home. While you probably think it doesn’t matter, it will if you ever decide to sell your home. That’s an important aspect to buyers, with homes in neighborhoods that have access to good schools generally appreciating in value faster than homes in neighborhoods where schools are average are worse, whether you’re purchasing a house among Charleston real estate or any other town in the country.

You Won’t Be Able to Resist Looking at Homes Higher Than Your Price Range

It’s only human nature to want something you can’t have, and nearly all people who shop for homes ended up looking at places that are out of their price range. While that’s all well and good, just don’t move forward with it. What’s even worse than living in a house that may need a few minor repairs is living in a nice home that you can’t really afford and eventually having to sell it when you don’t want to, or even worse, going through a foreclosure.

You’ll Probably Get Outbid

In a sellers’ market, or in areas that are hotter than others and likely to have cash buyers, you’ll probably get outbid, and more than once. While getting your offer rejected isn’t fun, keep trying - odds are that you will succeed.

How Having Kids Changes Your Taxes

Having a child changes everything. Your relationship with your partner, your work schedule, your sleeping patterns—there are few things a new baby doesn’t have an effect on. Many parents are prepared for the sleepless nights, the need to switch to the minivan, and the decrease in social hours with friends, but have you thought about how your new little bundle of joy will affect your taxes? While you often hear how expensive it can be to raise a child, there are also numerous tax breaks and credits to take advantage of. Keep the following facets of the tax system in mind and give your finances the boost they need, from your little one’s birth to their college days.

Use Exemptions to Your Favor

After having a child, you’re allowed to claim them as a dependent on your taxes to receive an extra exemption. This can help reduce your AGI, or adjusted gross income. The government uses your AGI to determine how much you owe, therefore, the lower your income (after exemptions), the lower your tax bill. There are limitations to this, but most can look to save thousands of dollars. Siphon those saved dollars into a college savings account and you’ll be amazed at the difference it makes in paying for your child’s upcoming educational career.

In the Case of Adoption

Perhaps you’re adopting a child. This process is not an inexpensive one, but the IRS recognizes these costly expenses by offering the opportunity to claim these expenses on your income taxes. Last year, any adoptions completed in 2015 allowed a federal adoption tax credit of up to a $13,400 per child. The amount you receive depends on your income. If you and your spouse make less than $291,919, you’re eligible. However, there are limitations. Because this is a tax credit, it isn’t refundable. That means you must owe the federal government some type of income tax, and you won’t be paid out the extra money left over, if any. The adopted child cannot be a stepchild, and they must be under the age of 18 or unable to take care of themselves to qualify.

Child Tax Credit

This refundable credit is designed to reduce the taxes you’re liable for, and can be awarded in amounts up to $1,000 per child. The amount of the credit awarded depends on income and the number of children living in your home. If you claim singly or as the head of the household, you’re ineligible for this credit if you make above $75,000. If you’re married, filing jointly, you must make less than $110,000 to qualify. If you’re confused about what will best work in your financial favor, speak with a professional who can help you determine your filing status.

When it Comes to College

If your child is already in college, take advantage of the American Opportunity Credit. This credit covers certain expenses associated with the first four years of college. There are regulations about how and who qualifies for this tax credit: your child must be in pursuit of a credential or a degree, and must be enrolled as a half-time student at least for tax year. They must also have no felony drug convictions on their record. For each student, the maximum credit you can procure annually is $2,500.

You should also keep the Lifetime Learning Credit in mind. This can help cover undergraduate costs for a student that does not qualify for the American Opportunity Credit, whether that be because they have a limited course load (are enrolled in school less than half-time status) or they’ve already completed their first four years of college credit. This credit can cover expenses including tuition and enrollment fees, along with books and course materials.
Child Care Credit

If you work full time and you must enroll your child in day care, most of those expenses are deductible on your income taxes. This is a nonrefundable tax credit. In order to qualify for the Child Care Credit, you must show proof of payment to a licensed childcare provider while you’re working or in search of employment. The child must be under 13 years old, and you cannot claim this credit if you’re married, but filing separately. This credit can award more than $3,000 per child per year.

The ins and outs of the tax process become more convoluted after having a child. If you’re unsure about which credits and exemptions you qualify for, don’t be afraid to talk with a professional to discover how you can get on the right financial foot- there are probably more than you think!

How To Make Downsizing Easier

Downsizing is necessary for a number of reasons; whether you’re making the switch to a smaller place due to money issues, a desire for simplified living, or moving to a new city, moving your family into a home with a much smaller amount of square footage isn’t always the easiest of tasks. Make the transition easier on you and your kids by following these downsizing guidelines.

Finding a New Place

When you’re hunting for a new place, especially if you’re going to be renting, make sure you don’t jump on an apartment just because its square footage is smaller. Make sure the limited space is designed well and conducive to your living habits, especially if you have children. Often downsizing is due to money limitations, but signing your name on the lease simply because it fits into your price range is not advisable, especially if you want to make downsizing as painless as possible. Use listing sites like LiveLovely.com that allow you to input various filters so you can narrow down your choices. Don’t let desperation to find a home let you speed through the process; view multiple homes, and don’t land yourself in a terrible landlord situation (or fall for scams) just because you’re anxious to move—if something feels off, it probably is. Something to keep in mind during this process: if a landlord asks for sensitive information, always request he or she use a service like MySmartMove to ensure your SSN and bank info doesn’t fall into the wrong hands, and make sure you have enough money in a savings account to cover the rent for the first few months.

Perform an Inventory

It’s going to be an extensive and time-consuming process, but the first thing you need to do is take a detailed inventory of everything in your current home. Go through the new apartment or house you’ve found and take exact measurements of the floor and wall space. Compare it to the dimensions of your current home, and determine how much you’ll need to get rid of. You need to have a comprehensive understanding of all of your belongings, and determine the things that will be coming with you to your new, smaller space, and the things you can leave behind (by selling, donating, or throwing away). Make three different lists: one of the things you can get rid of, the things you can hypothetically live without, and the things that must come along with you. The things you decide you can get rid of can be sold in a garage sale, donated to a worthy cause, or find their way into a local dumpster. You’ll want to refine these lists a few times; it’s simply amazing how much of an emotional attachment we can have to physical items, but simplifying your life means getting rid of items we might have previously thought were absolute necessities. Look at your list of must-haves again and again, and see if the essentials are actually necessary for your life and your new space.

When it Comes to Selling

If you do decide to sell off the belongings you decide you don’t need, you will find yourself with an excess of cold hard cash that you wouldn’t have had otherwise, especially important if your downsize efforts are due to monetary concerns. You can decide to host a good old-fashioned garage sale, post your items on a common website like Craigslist, or use eBay to get rid of the things you no longer need. If you’re looking to sell designer items, use a site like Tradesy, where you can find buyers willing to spend quite a bit on any designer pieces that are still in great condition.

Make Smart Storage Choices

When it comes to working with limited space, organization is your best friend. Before moving in your new space, nail down which storage solutions you’ll take advantage of. Use vertical storage options to take up the least amount of floor space possible, purchase furniture with hidden storage containers, and utilize space under the bed and behind other furniture pieces to keep your belongings sorted. Stick with decorations that incorporate clean lines to avoid the appearance of clutter, and intersperse sentimental items sparingly throughout the house to incorporate personality without causing decorative chaos.
If you’re facing a downsizing transition, make it easier on yourself and your family by incorporating these tips into your moving process and learn how to live with less—it will change your life in a more positive way than you could have ever imagined.

10 Tips For New College Students From A College Student (Guest Post)

I remember when I was getting ready to start college – Everything was so new and so different. Two years have quickly gone by, and I’m now a junior. Here are some things I’ve learned from my own experiences and from friends that I’d like to pass along:

1. Get your finances together and be aware of your expenses. – Open a checking/savings account if you don’t already have one. Get in the habit of saving your receipts and documenting them weekly/monthly or however you choose. Your expenses will add up, so it’s best to stay on top of them so you don’t end up in a rut or overdrafting your account.

2. Take the time to read things and understand them. – You are an adult now, and you actually have to read through things to make informed decisions. This will certainly apply if you move off campus into an apartment.

3. Rent your textbooks if you can. – Renting is the best way to go, especially for books for general education (gen-ed) classes. Vendors such as Amazon and Chegg are great places to get them. You can buy books from your institution’s bookstore and sell them back at the end of the semester, but you won’t get nearly as much money back as you spent.

4. Be aware of the available meal plans and your eating patterns. – Most institutions will have a meal plan. Know what plans they offer, and don’t get a meal plan higher than what you know you will eat. Also, PLEASE be healthy! (Don’t eat Chick Fil A every day for three weeks like I did.)

5. Take school seriously. – Your first year of college is so important for your GPA. Focus on your grades first. If you keep it high your first year of school, you have some wiggle room if you don’t do as well one semester. Also, if you have scholarships, you need to make sure you maintain the GPA required to keep the scholarships.

6. Get to know your professors. – Your professors possess a lot of knowledge, and you’ll do even better in class if you sit in the front and introduce yourself to them. If you take the time to get to know them, they will be more willing to help you in class or with other things. Some professors have written recommendation letters for me.

7. Don’t be afraid to get involved, but don’t over involve yourself either. – There are TONS of ways to get involved at your college/university. Try to get involved in at least one activity or organization so you can meet people and begin developing skills. However, don’t get over involved either. You don’t want to be overwhelmed and affect your grades or well-being.

8. TIME MANAGEMENT IS KEY. – Get a planner if you don’t have one already! You’ll be super busy with classes, extracurricular activities, and maybe even a job. Be sure to stay organized!

9. Take care of yourself. – People are going to ask you to do things, approach things in their way, but at the end of the day, you need to do what is best for yourself. If people want to go out and do something, but you want to take an evening for yourself and watch TV, then by all means, watch TV!

10. HAVE FUN.
College goes by so quickly! Take the time to explore new things. Take a class on something you’re interested in, but might not be majoring in. Meet new people and make great friends. The world is yours.

Guest post by my oldest daughter, Chardonnay Ismail.

Money-saving tip for buying butter in bulk #HouseWifeLife

I have a new love and he goes by the name of Sam, Sam's Club to be exact! I have become such a fan of buying in bulk. One thing that I have contemplated on buying for months was butter. It comes in 4 one-pound solid blocks. I spend a small fortune (about $3.50-$4) in the grocery store on butter in sticks, so getting 4 pounds for $8 is a bargain! 

I finally broke down and bought it this weekend and came up with a great solution. Why not make my own sticks? All I did was set out one block of butter on the counter for no more than 30 minutes. Next, I took a knife and sliced straight down the middle and then did the same with each half. I wrapped each quarter in wax paper. I put them in a zipper storage bag and placed the remaining 3 solid blocks in the freezer. The savings is worth the extra effort!

Tips for buying a home

Everyone dreams of owning their own home, but buying one is a lot of work. Just preparing for homeownership is a massive undertaking that can seem daunting. There are processes that you have to go through before you can even think about looking for the home you want to buy.

Budgeting and banks
First, you have to know exactly what your budget is and how much you can afford to spend. The banks will need this information before they will even think about giving you a mortgage loan, so have it all ready. The difference can sometimes help in negotiations with a seller for a better price on the home. Make sure that you are pre-approved not pre-qualified. Research diligently through different lenders as well. Make sure you get the best possible mortgage and interest rates.

Look into the area
You will have to know what you need as far as size like the number of bedrooms, bathrooms, square footage, etc. You will have to take into consideration schools, transportation, and stores as well. If you prefer public transportation, you will have to make sure that you are near to the local pick up. Do you want the local stores to be close at hand? The Local Records Office can give you a lot of information about the neighborhoods you are considering, so make sure to look them up.

Contract a buyer's agent
The housing market changes constantly. Even though we are recovering from the housing crisis from a few years ago, you will want to do plenty of research. You don't have to have a real estate agent and honestly, agents work for the seller not you. However, you can contract a buyer's agent if you wish. A buyer's agent will ensure you find the house you want for a good price and actually works for you.

Look for homes
Look at a lot of homes before you make an offer for one. You want to make sure that you are getting exactly what you want and not just settling for what you think you can afford. After all if you are paying that much money to buy a home, you want to be happy in it. Likewise, don't allow an agent to push you into a house you can't really afford either. Just because you qualify for it, doesn't mean you should buy it. You could overtax yourself and that will lead to trouble later on.

Once you make an offer and it is accepted, there are several steps that have to be taken. A home inspection to check the foundation, construction, heating and cooling system, electrical etc must be done. This is important so that you and your bank know that the home is sound.

You will have to buy homeowners insurance and bring the document with you to your closing along with your down payment and another check for closing costs unless you have negotiated for the seller to pay them, you will be responsible for those.  The closing should take about an hour and when you are finished, you will be the proud owner of a home of your own.