Easy Personal Finance Tips Everyone Can Use

For the Average Joe, even if you feel you’re doing well with your finances, you could probably stand to make a few changes to your financial habits. If you’d like to spend less and save more, here are a few things to think about.

Be smart with credit cards: A credit card can be a valuable tool, but if used incorrectly, it can create debt that can be tough to manage. Only use your credit card for purchases you can pay off each month. This is a great way to build a good credit score, but always make sure you’re being careful when paying with plastic.

Find savings as often as you can:  It doesn’t matter how big or small the purchase, you can probably find it cheaper somewhere else. Have you checked the competitor’s prices? Looked online? More times than not, you’ll find just what you’re looking for on the internet, and usually for a lot less.

Use automatic bill pay: Have you mapped out your monthly bills and their due dates? If you haven’t, now would be a good time to start. Look at the due dates and design an auto pay schedule that will keep you from missing any payments. Paying your bills on time is a must if you want to keep your credit score up.

Be cheap: No matter how much money you make, you should always try to live below your means. The less you spend, the more you can save for your future, and you’ll be glad you planned ahead when retirement time comes around.

Article Source: John Pettit for CUInsight.com

Personal Finance Lessons Students Should Learn Before Graduation

How to make a budget.

It all starts with the budget. Here, students can compare earnings to expenses. It will give them insight into the value of a dollar. With a budget, students can plan for major purchases, eliminate debt and create good saving habits. Check out our budgeting guide here!

How to balance a checkbook.

While few people probably write checks anymore, students should still know how to balance a register. Even if they prefer to use an app to help keep up with their funds, the basic accounting skills they’ll gain from an old-fashioned register will give them insight into how their money flows. It will also teach them that even financial institutions can make mistakes, so it’s good to check the account for errors or fraud on a regular basis.

The real cost of credit cards.

Credit cards have advantages, but as anyone who’s gone into debt knows, those advantages can come at a significant cost if card holders aren’t careful. Understanding how compound interest works and what that $40 shirt will cost them if they take years to pay it off – will help them make wise choices with their credit.

How to build good credit.

Good credit can save them exponentially over a lifetime. Everything from home and auto loans, to job applications will be affected by a person’s credit score. Teaching students about what makes their score good, how to build it and how to monitor it will set them up for years of success.

What to do when it goes wrong.

Having a financial backup plan can make the difference between disaster and survival, when a major catastrophe strikes. Tools such as health and homeowners insurance and a savings account are critical, but increasing numbers of Americans do not employ these resources. Teach students how to plan ahead of time so they can weather inevitable disasters successfully.

Article Source: Jennifer Reynolds for CUInsight.com

How to Get Back on Track If You’re Drowning in Debt

bigstock-Businessman-Run-Away-From-Debt-103353212Getting out of debt is much harder than getting into it. But you can do it — and along the way, you’ll rid yourself of a lot of stress.

Countless people find themselves drowning in debt simply because they can’t control their spending. If this sounds familiar, try tracking everything you buy for a month, including all those “little” items that cost just a few dollars. Once you see how those purchases add up, you’ll realize how important it is to lay out a budget and stick to it.

Understanding how much you actually spend is a good first step, but that alone won’t get you out of debt. The following strategies for managing different types of expenses — and bringing in some extra income — can you help you reach a happy, debt-free future.

Control your credit card usage. If credit card debt is the problem, take these steps right away:

  • Cut up your cards: Save one card for use in emergency situations. Cut up all the others, and throw away the pieces.
  • Pay with cash: Only pay cash for purchases such as groceries, clothing, and gas.
  • Attack high-interest debt first: Pay off the credit card with the highest interest rate first. Once this card is paid off, apply what you were paying on it to the card with the next highest rate.
  • Negotiate a lower rate: Negotiate your interest rate with your credit card companies. Your issuer will usually work with you if you say you’re going to transfer the balance to another card with a lower rate.

Cut some recurring expenses. Most people have recurring monthly expenses that can be eliminated, including:

  • Excess phone service: If you have a mobile and a landline, you probably don’t need both. Pick one and stop paying for the other.
  • Satellite/cable television: Consider disconnecting satellite or cable service and replacing it with a streaming service, such as Netflix or Hulu. You can get entertainment at a fraction of the monthly cost.

Keep an eye on your indulgences. We all have little indulgences we like to spend money on here and there, but we often don’t realize how much they add up.

  • Specialty coffee: Stopping by Starbucks on your way to work every morning is certainly a luxury you enjoy, but you could save $25 or more a week by making your own coffee at home.
  • Fast food lunches: If you work outside your home, chances are you buy lunch out at least a couple of days per week. These costs mount quickly. Even if you spend only $40 per month eating lunch out, that’s $40 that could go to your savings account or toward a credit card payment.

Bring in extra income. When you lose control of your finances, getting out of debt requires serious action.

  • Take a second job: No one wants to work 16 hours per day, but if that’s what it takes for your family to thrive financially, then it must be done — at least temporarily. It may be that working an additional, part-time job for just 20 hours or less per week is all that’s necessary to help you out financially.
  • Sell things you don’t use: Many of us keep things we no longer need in the basement or storage shed. Sell any item you haven’t used within the last year online or have a garage sale.
  • Sell your (extra) car: If you’re a two- or three-car household, chances are you could make do with one less car. Consider selling one if it isn’t a necessity.

Reduce debt — and stress.

It requires work and a commitment to doing what it takes to reduce your expenses-to-income ratio. Once you make that commitment, you’ll find that your bank account grows and your stress level decreases.

Take advantage of First Financial’s free, online debt management tool, Debt in Focus. In just minutes, you will receive a thorough analysis of your financial situation, including powerful tips by leading financial experts to help you control your debt, build a budget, and start living the life you want to live.

*Original article source courtesy of Pamela Sams of the LA Times.

The One Way to Never Fall Into Debt Again

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Debt is literally a four letter word; it just also happens to mean you owe money.

Many Americans have a dream they’ll never realize: living without debt. Yet, the dream is possible for nearly everyone – just be prepared for the sea change of behavior required to make it happen. If you are unprepared, your ship will never make it to the safe harbor of paradise, and you will crash upon the jagged rocks of financial ruin.

Follow these simple steps to make your dreams of a safe financial future come true, and steer clear of financial ruin.

Make Up Your Mind

Many people fall into debt because they grow complacent, spending above and beyond their means, living from paycheck to paycheck with barely enough to make the bills. They don’t have enough to pay for dinner out on Friday, the new clothes that go with it, or the movie after.

Yet they do it anyway, and on the credit card the spending goes. The honest, painful truth is that if you don’t have the money for those things, you shouldn’t be doing them. Learning to be satisfied with your limitations is difficult. You want to be accepted by your personal crowd, but if your crowd’s habits are decaying your account balance one bad habit at a time, you have to ask yourself if the consequences are really worth it.

Once you decide that the lush greens of financial security offer an abundance that the Jones’ can’t match, then the seas gets glassy and the waters are far easier to ease through.

Say Goodbye

Once you’ve made up your mind to live within your means, it’s time to say goodbye to your plastic.

Either cut them or bury them far, far away. You may even want to freeze your credit cards. You can’t open the dam for the credit flood waters if you don’t have access to it. Don’t panic. It’ll be tough at first to say goodbye because you’ll feel like you’re being left without a life preserver, but the truth is you’ll be gaining a lifeboat in exchange.

Pay Off Your Debt First

Cutting up your card was the first step. Now you must be proactive about slashing it to zero. Snowballing is an extremely effective way to quickly demolish your debt. Establish your payoff plan and stick to it. This debt is now a “need” on your financial map.

You have a plan for paying off your credit cards, now lay out your map to help you get from paycheck A to paycheck B.

Lay Out Your Map

What are your needs? What are your wants?

By organizing your finances by needs and wants on a paycheck to paycheck scale, you can pay off the needs first, then have whatever is left for you. When you draw your financial map, classify bills, debts, and savings as needs, don’t forget to calculate things like clothes and the once in a while purchases too. Otherwise, your budget won’t resemble reality. The only rule is to determine needs from wants when you allot your funds.

Track Your Money

The beauty of online bill pay is that using it for everything keeps you from running blind through your budget, while showing you exactly what’s happening with your balance. Without credit or debit cards sucking the life from your account, it’s one way in and two ways out – cash and bill pay.

Use bill pay for everything and withdraw your cash for the extras bill pay can’t handle such as gas and petty expenses. Once your cash is gone. You’re done. No more spending until the next paycheck is securely in your account.

Remember to withdraw enough cash to get you through. Allot the amount of cash required for groceries, fuel, kid’s needs, and anything else you may need for the period. If you know your child needs new clothes, establish a plan for that spending and only use cash you have readily available.

Some people label envelopes so they can distribute the cash they need to the places they need it, without cutting into funds from another category. Do whatever works for your mind and your system. The only unbreakable rule is that you can’t spend beyond the cash you have, so you must manage it well.

Once you have learned to live within your means, and have your debt under control, life will be sweeter and you’ll never return to the choppy waters of too much debt again.

*Original article courtesy of Vincent King of MoneyNing.

How to Build Savings From Zero

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You’ve seen the numbers. They aren’t pretty.

A recent Bankrate.com survey of 1,000 adults suggests that 66 million American adults have zero dollars saved for an emergency. That dovetails nicely with a report that came out earlier this year from the Federal Reserve, which looked at the economic well-being of American households. And things are not going so well. About one-third of 5,695 respondents to a 2015 survey revealed they would have trouble dealing with a $400 emergency.

Sound familiar? Start building your savings with some of these methods.

Start small. That’s advice from Mackey McNeill, founder and president of Mackey Advisors, a wealth management firm in Bellevue, Kentucky.

“If you have never saved anything in your life, save $5 a week or $10 a week,” McNeill says, adding: “Pick a number that, regardless of disaster, you can achieve.”

After you do that, McNeill advises, “Put the money in a separate account and review it once a month. After three months, consider an increase. After three more months, consider an increase again,” and keep repeating.

“The reason people fail at saving is they start too high. … So they set themselves up for failure,” she says. “Start small. You will be so excited that you met your goal, you will automatically want to do more and achieve more. When you start small, you set yourself up for success. Success begets success. I have never had anyone try this who did not succeed.”

Reward yourself when you save money. This is important, McNeill says, advising that whatever the reward be, make it something free.

For instance: If you save $10 a week, then every time you hit $40 saved, rent a movie at the library or take a walk in the park, she explains.

Whatever you do, “make it something that really nurtures you,” she says. “It doesn’t matter what it is. A hot bath will work. But when you give yourself the reward, you are reinforcing the behavior you want.”

Trim back your expenses. One thing that probably keeps most people from saving more is that there may not be enough money to go around. That’s definitely the case if there are expenses that could be easily cut, or debt that’s weighing you down.

When you’re beginning to put together a plan to save money, or begin your accumulation phase, the first thing to do is pay off any high-interest debt like credit cards. Paying off high-interest debt is the most important first step in beginning any accumulation phase because everything you pay off, you are eventually saving money on high interest.

Make it easy. Assuming you have a financial institution – a Federal Deposit Insurance Corporation study suggests that 9 million Americans don’t – the easiest way to save money is to set up a savings account and then direct a specific amount to go regularly from your checking account to your savings account, says Michael Eisenberg, a certified public accountant and personal financial specialist with Innovative Wealth Advisors in Encino, California.

“Every time your paycheck hits your checking account, you should instruct your financial institution to move a set sum directly into your savings account,” he says. “This makes it easy and seamless.”

Eventually, he says, you won’t even miss the money because it’s automatically disappearing, and you’ll get used to working with the money going into your checking account.

Susan Howe, a certified public accountant in Philadelphia, echoes that advice. “Even a modest amount will add up quickly if you set it for a weekly transfer. Just be sure there are no fees,” she says.

Try opening a 401(k) or an IRA. That’s what Leonard Wright, a wealth management advisor in San Diego, suggests. In particular, Wright recommends opening up a Roth 401(k) or a Roth IRA.

“This money grows tax-free for life, is not subject to required minimum distributions when you retire and best of all, is tax-free when you need it – and can help with education expenses for your children,” he says.

But McNeill notes that wherever you put your money, whether in a 401(k) or other savings account, “in the beginning, it’s irrelevant,” – as long as you’re saving money somewhere. “What you are trying to do is create a new habit.”

How will you begin preparing for your retirement today? To set up a complimentary consultation with the Investment & Retirement Center located at First Financial Federal Credit Union to discuss your savings goals, contact us at 732.312.1500, or stop in to see us!*

*Representatives are registered, securities are sold, and investment advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor, 2000 Heritage Way, Waverly, Iowa 50677, toll-free 800-369-2862. Non-deposit investment and insurance products are not federally insured, involve investment risk, may lose value and are not obligations of or guaranteed by the financial institution. CBSI is under contract with the financial institution, through the financial services program, to make securities available to members. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America.

*Original article source courtesy of Geoff Williams of US News.

12 Ways You Can Save Money Without Sacrificing Your Lifestyle

bigstock-people-consumerism-lifestyle-102722153Saving or spending is an eternal economic dilemma. People are constantly torn between the satisfaction of present gratification and the promise of future prosperity. At a first glance, it seems almost impossible to simultaneously achieve both, due to the dynamics of limited income, volatile prices, and personal needs.

There are many instances where people spend their money quickly, for limited gains, and find themselves unable to save for the future. Conversely, other people sacrifice their preferred lifestyle in order to save money for a future goal which they deem important, but miss a lot of opportunities to enjoy the present. Both approaches are prone to bring regret, dissatisfaction, and unhappiness in the long run. So what can we do?

Ideally, there should be a fine balance between saving and spending. This can be easily achieved with some self-discipline and common sense. To help you out, we will list twelve simple ways to save money without sacrificing your lifestyle.

1. Control the Urge for Instant Gratification.

The desire for instant gratification is almost inescapable, as it’s programmed in our natural behavior. We naturally prefer the now rather than the later, especially when it comes to things we need on a regular basis, like clothes, food, and household equipment. This also applies to leisure activities, which we would almost certainly prefer to do now, even if we’re short on cash.

To counter this, we should always consider whether short-term benefits outweigh long-term gains and make sure we can spot which cases of instant gratification endanger our long-term aims. For example, when choosing between going to a job interview or to an anticipated party, you must make sure you understand the consequences of each choice from your particular standing point. Nobody is telling you not to enjoy yourself, but make sure you fully understand the benefits and the costs.

2. Make Smart Shopping Choices.

Before making a purchase, put on your thinking cap first and ask yourself if you’re making a smart move or not. Do not act on appearance, rumors, and product presentations, but on facts and client reviews. In the meantime, always keep your eyes open for a better deal and don’t rush into buying the first appealing item you find, whatever it may be. Inspect the market, compare prices and check for quality reviews. This way, you’re more likely to get a higher price-quality ratio when making a purchase.

Shopping takes time and patience and you must never forget to watch out for deals and discounts. It is much wiser to wait for a product to go on discount than to buy it straight away. If you shop smart, you will keep expenses at bay and still enjoy high-quality products.

3. Buy What You Actually Need.

Before you decide to purchase something, ask yourself whether you really need that particular item. It’s not uncommon for people to go shopping just for the heck of it and serious money can be wasted like this. Remember the fundamental principle of free market economics: supply and demand. Don’t you actually have two full wardrobes anyway? Is your laptop working fine after all? Is a new suit the absolute priority right now?

Only buy things which can play a part in your work or leisure pursuits. If you’re not sure you need it, you don’t need it.

4. Use What You Already Have.

It’s very important to keep track of the things in your house and of how well they can help you achieve your purposes. Many people tend to hoard stuff and then go buy some more stuff, without any though on whether they could get the job done with what they already have. Don’t go shopping if it’s already in the house. It can do its job. Give it a chance.

5. Use the Internet.

The internet is the tool for shopping. If you think you’re using all it can offer, you might be mistaken. From price comparisons, extensive client reviews, and advantageous deals, shopping online is the best way you can save money.

Instant access to prices, reviews and competitors gives you a wider market vantage point and will allow you to make an informed decision with just a few clicks. You can find more helpful tips on using the internet for shopping efficiently here.

6. Take Advantage of Online Deals & Surveys.

Saving money can also be achieved by taking as much advantage as possible from online deals and surveys. Many companies are very keen on getting as much feedback from their customers as possible and prepare questionnaires, feedback forms, and surveys. Participating in these can be very beneficial because companies will sometimes reward you with discounts and vouchers. Converse, for instance, has developed an excellent method of retaining their customers’ loyalty by creating an easy customer feedback survey that allows shoppers to update their wardrobes through a personalized gift card.

7. Plan Your Leisure Time Carefully.

People who can have fun and save money at the same time usually have a very clearly defined work and fun routine. In order to save money, it’s very important to know when to go out and when not to. Self-disciplined people don’t avoid the fun parts but know when to schedule them without disrupting the quality of their work. Work hard, play hard, but not at the same time. It’s as simple as that.

8. Rediscover the Old School Way of Having Fun.

Rediscover the charm and satisfaction that old school fun can bring, especially now when we’re seemingly unable to step away from our laptops of phones for more than five minutes. Instead of spending a ton of money clubbing or pub crawling, go at a friend’s house for a barbecue, a movie or a board game. Skip that expensive concert and go on a camping trip next weekend. Having a great time is about people, not places and things. So try to tone down the spending while doing similarly fun things.

9. Learn When to Stop.

It’s very easy to lose yourself in a shopping spree. Once you get started, you will need all the willpower you can muster to prevent yourself from rampaging through your favorite store. If you want to stay balanced and keep your budget afloat, learn when to say no. Sometimes you simply can’t afford to spend all that money on something non-essential. Less is more.

10. Make Realistic Plans.

Don’t wish for what you know can’t possibly happen. Think smaller and keep your feet on the ground. If you have an average income, but you’re running two bank loans to pay for cedar wood furniture, then you’ve probably lost your bearing at some point. Learn not to live above your means and grow your income organically, not artificially.

 It’s alright to have bright future plans. But make them realistic.

11. Exercise Full Control on Your Finances.

Control your money. Don’t let someone else manage it for you and keep a written account of income and expenses for each month. That way, you’ll be able to see where you’ve overreached and where you need to cut back. Keep a strict security routine for your credit and debit cards. In addition, make sure you always know what the opportunity cost is for every purchase. So, if you buy a laptop, keep in mind you won’t be able to also fix the car this month.

Leave nothing to chance and keep a sharp eye on your balance sheet.

12. Keep a Balanced Mindset.

In the end, however, what really matters is your mindset and attitude. If you have the self-discipline, the patience, and the internal balance to prevent you from making mistakes, there is no reason why you can’t live a good life and still save for the future. Optimism is also helpful, but make sure it’s the realistic, kind.

*Original article source courtesy of Mike Jones at SavingAdvice.com.