Saturday, July 25, 2015

Five Things You Need to Do Before Borrowing Money

You can't just borrow money blindly. Ignorance and lack of planning can be very expensive when it comes to your finances. If you're considering to get a loan, read these insights first.

Define your reason for borrowing money - Are you borrowing money just to satisfy an immediate desire or to support a budget shortfall? Borrowing money to solve any of the two won't be beneficial for you. You will end up with unnecessary interests and into a cycle of debt respectively.

Define your capability to payback -  Can you  make periodic payments later? Even though you're going to use your loan for business purposes or to make more money, you must make sure that you will be able to pay or else you will have an outstanding debt.

Be aware of all the costs of borrowing money - How is your loan going to be calculated? What about the interest rate? If you don't know the answers to these questions, you will be surprised that you could be paying more than you expected.

Study the loan terms in your contract - Don't sign your contract until all of its contents are clear to you. Your finances will be jeopardized if you do so. If you don't understand the words used in the contract, consult a lawyer or a professional who can help you out. Don't be embarrassed to make changes if you think the contract doesn't include the things you have agreed about. Keep a copy of the loan contract for your protection.

Check other options besides borrowing money - Borrowing money will definitely mean a debt which you must payback.  For example, consider getting a second or third job to extra and save money for the small business that you're looking forward to build. It might take you a couple of years or more to save but you will spared from a debt with interest.

Saturday, July 18, 2015

Learn Which Debts You Should Pay First

Do you have several debts or loans to pay? Are you wondering which ones to pay first? This can be very challenging especially when a couple or more credit card companies are hunting you down every month. Most people go paying just the minimum on their debts. This may seem like a good opportunity for you to save money but the truth is this will just extend your debt much longer.

Some finance experts recommend paying off the smallest debt first. This is like just paying off debts within your means. As mentioned above, this won't create much savings for you because it has a snowball effect in the long run. For all you know, a small debt can have an extraordinarily high interest. If your goal is just to get one loan erased from your debts spreadsheet, this will be a good strategy then.

If you want to save the most money possible, it is best to pay your credit card loans with the highest amount you can afford. Your loan balance will be smaller this way and so the interest will be much lower too.  Regardless of what experts might advice, it is important to stick with the plan that you can consistently observe until all your debts are erased.

Saturday, July 11, 2015

Four Steps to Reducing Your Debt

What are the things that you want to achieve with your money? Identify at least two objectives with regard to this and you will be able to find ways to reduce your debts and improve your financial conditions. If you need strategic ways to be debt-free this year, read the following insights.

Highlight the reason behind your debt - Why are you borrowing money?  If you're borrowing money to pa'y bills or purchase your basic needs, you will have a hard time getting out of the cycle borrowing money and paying it back.  Borrowed money can fill in the gap temporarily but it can worsen your debt.

List down all your debts - Take note of all the money you owe other people or lending companies. Total all your debts. Create a spreadsheet so you can clearly see the monthly payments required, the loan interest rates, and the time remaining for payback. In another spreadsheet, create a debt reduction plan that will suit your financial capabilities.

Push yourself to your limits just to pay your debts - Nobody else will pay them and clear your name but yourself. Do something drastic that can earn extra dollars for you in order to payback your debts in time. Make sure not to take another loan just to cover your previous loans. Engage in extreme sacrifices like selling some of your priced possessions - car, computer, mobile gadgets, appliances or pieces of jewelry - so that you can come up with extra money.

Quit depending on debt - Change your attitude towards borrowing money. Never think of borrowing money whenever a certain need arises. Learn how to attend to or supply for that need within your means. Evaluate which methods will work best with your limited budget.

Saturday, July 4, 2015

Five Reasons Why You Should Try Community Banks

Are you having second thoughts about putting your money in a local bank? Yes? Read this post and you might be enlightened with the many benefits of investing in community banks over national banks.

You can experience the same services at lower costs - It is a fact that small financial institutions offer better interest rates as far as savings is concerned. You don't have to worry about spending a lot of money for debit card, credit card and online bills payment charges.

Your deposits will stay in your locality - Bigger banks lend the money deposited to them to other states. On the other hand, a community bank only lends its money to its local neighborhood.

You can be qualified for a loan through your personal credentials - Large banks usually carry out impersonal rules and regulations when it comes to their loan processes or systems. Conversely, community banks are open to taking into account your family history and personal character or credibility when deciding to lend you money. Individual circumstances actually matter to local banks. This explains why they spend time to consider them.

Your loan request can be approved in less time - Apart from considering your personal qualifications, community banks aim to work in your favor. They are able to decide on loan requests immediately because executives and employees are located locally. Loan approval committees in bigger banks lengthen your waiting time.

Your condition is understood by community banks - A community bank is a small business that understands fully the circumstances of a small business. Big banks operate in the same way big corporations operate. They will shut down branches when money gets tight.

Saturday, June 27, 2015

How to Teach Your Kids to Handle Money Effectively

Do you have kids who spend  money like crazy? It is not yet too late to teach them how to manage their money effectively regardless of their age. As a parent, you just have to be determined to teach them financial skills from which they can benefit for the rest of their adult lives. So, how do you start with this? Here are some ideas.

Introduce piggy banks - Instead of buying the toy they want from your spare money, encourage them child to save up in a piggy bank. Use the toy as their goal for saving up. This will teach them a lot of skills and virtues as well like delayed gratification, patience, self-control, frugality, planning and budgeting.

Teach your kids the value of earning their own money - When they get older, kids cannot spend their whole lives depending on you for their needs and financial problems. Is there a chore that they are capable of doing after school hours or during weekends? Encourage them to accomplish those chores regularly in exchange for a few dollars. You can also recommend them to your friends, co-workers or churchmates who might need babysitters or helpers for the day. They can gain confidence about earning money on their own through this.

Open a savings account for your kids - Open an account for each of your kids with the least amount needed. Teach them that their bank accounts are for saving money for future expenses. With the money that they're able to save, they can buy their first car or pay for their college tuition. Instruct them to deposit a part of their earnings in their bank accounts, but it will be better if you model it in front of them too.

Talk about money with them - Well, you don't have to let your kids know everything about your money or personal earnings and savings. Just give them an overview about your family's monthly expenses and budget. This will open their eyes to the reality that they can't buy just anything that they want and to prioritize the things they need to spend on.

Saturday, June 20, 2015

Six Steps to Managing Your Low Income

Dealing with a low income is challenging but doable. There are a series of practices which you will need to observe with regards to this. These practices will require you to make huge adjustments that can change your lifestyle and spending habits.

Plan ahead for bills - No matter how big or little our income is, we'll definitely need to pay bills monthly. Save for the payment of your bills as soon you receive your paycheck. Paying your bills promptly will keep you from paying penalty fees which are added expense.

Budget your income - A budget will show your exact earnings and your expenses. A budget will show you if you're spending more than what you earn. Hence, it will be easier for you to check if you're about to be in debt. Create a monthly budget and stick with it.

Prioritize your necessities - Label your basic needs in life. You will definitely need food in order to survive and be able to work daily. So, place it on top of your list. If you're taking medications, you can place it next to food. If not, list down shelter next. Don't forget your utility bills and  your transportation allowance for going to work

Be organized - Try a budget planner in order to manage your finances effectively. If you get your budget intact and organized, stick to it. Never put your dollar on trivial things.

Stay away from unnecessary spending - Avoid shopping randomly or impulsive buying. Spend only on the things that are important to you. Oftentimes, unnecessary spending springs from boredom. Make yourself productive and you will forget about spending your money.

Unnecessary spending springs from boredom...Make yourself productive.

Invest on value - When at the mall, look around for some value in your shopping.Shop for the best price. Wait for  a sale if you need to purchase a major item that will cost you much money. This is quite time consuming and stressful but this will allow you to save money.

Friday, March 13, 2015

Effective Ways to Save Money on a Tight Budget

Payday is a couple of weeks away and there are only a few dollars in your bank account. Yet, you still need to save money. Saving money is more than just putting away a few dollars for a rainy day. It involves a change in lifestyle and spending habits that leads to a higher level of saving.

Don't feel entitled to all the merchandise available in stores. Do you need multiple cell phones, televisions and other gadgets? Will these make you feel better about your financial situation? They might make you feel rich at the moment but they can leave a scar to your financial status.

Learn extreme couponing and save thousands. Extreme couponing is very famous for good reason. Men and women across the United States are saving thousands of dollars on everyday items like paper towels, toilet paper, dish detergent and laundry detergent. These are the everyday things that may seem small but adds up to your monthly expenses.

Doing potlucks at church and family gatherings helps save food budget. Do other people usually gather at your house for fun, relaxation or sharing? Your wallet need not carry the burden of the food shopping. Do potlucks and you will save on food costs.

Drive only when necessary. Gas prices are soaring. If you want to save on gas, consider buying a quality bike and take it to the road. Some families choose to spend the entire summer within a few miles of their home just to spend less on gas.