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3 Tips That May Not Be The Best Financial Advice For You

couple with a financial expertWhile there is a financial advice for every generation, there is still a need for you to consider if these tips are really applicable to you. There is no one size fits all financial management. You need to understand which of them should be implemented in your life based on your specific financial situation.

There are a lot of gurus out there who are truthfully, sincere about helping you improve your financial standing. But before you apply their teachings in your life, make sure you understand what is at stake first. It is not enough that you keep on implementing what you hear. You need to filter out what will benefit you the most.

3 financial tips that are not always good for you

There are certain financial tips that when you first hear about them, you would want to implement them immediately. But before you do that, please make sure that it is an advice that you will really benefit from. If not, you can lose more money because of it.

Here are three financial advices that you need to consider carefully before you commit to them.

Financial advice 1: Automate your bills payments

There are financial advisers who tell consumers to automate their payments so it will never go to default. This makes a lot of sense if you think about it. You do not have to worry about making deadlines and keeping up with all the money that you have to send out every month. You do not have to juggle with due dates and all the details that come with making payments each month. Best of all, you do not have to worry about late payments.

But according to BankingMyWay.com, a pitfall of automating your payments is you will get lazy. The convenience that makes this mode of payment appealing can also be its downfall. You can easily lose track of all your payments. Since you are no longer thinking about them every month, you could think that your financial obligations are not as demanding as you thought it was. That could make opening new accounts more tempting.

You can also miss out on any machine related mistakes that could have caused you to pay more than what your should. Or it can cause you to pay less which will end up making you incur late penalty fees. Not only that, you can be in danger of overdrafting on your account. That is something that you do not want to happen.

Unless you are sure that you can control your spending and you can keep track of your payment, you may want to rethink following this financial advice.

Financial advice 2: Using credit cards for their rewards.

We have heard this advice before – if you will take a credit card, make sure you can benefit from the rewards. Some people are only interested in applying for the card because of the rewards and discounts they will get immediately. According to the data provided by CardHub.com, the initial rewards and bonuses of credit cards are 10% more in the first quarter of 2014 as compared to the same period in 2013. This can be very tempting to grab since the points and miles-based rewards are considered to be at an all time high when it comes to value.

But even if that is true, you need to exert caution. These cards will only be beneficial if it fits your spending lifestyle. If not, then do not avail of it. They will only be a temptation to increase your purchase.

Financial advice 3: Do not touch your emergency fund.

There is an interesting article from Investopedia.com that discussed why an emergency fund is a bad idea. According to the article, it is overly prudent to create an emergency fund. If you understand the risk and your other options, you will realize that there are better places to put your money than to let it sleep in your bank account.

At least, this is true if you are after financial wealth.

If you do the math, a person who lives on $30,000 a year will have to save up at least $22,500 to have enough emergency funds. But think about it. The average interest on your savings account is a mere $1-2%. That only translates to $225 to $450 growth. Even the ones with the highest yields of 3.5% will give you less than $790 of annual growth.

Now if you put that money on an investment that will earn you 15%, then it will earn you a whopping $3,375 per year. Don’t you think the need for an emergency fund is not too smart at this point? Just think about it.

You can probably set aside 3 months worth emergency funds and put the rest in an investment that you can liquidate easily should the need arises. That is how you setup your money to work for you.

How to filter the money advices you get

In truth, there is no such thing as a bad financial advice. Even putting yourself in debt is a good advice – but again, it has to depend on your unique situation. We were all told to eliminate debt but there are benefits to being in debt. Things like having the opportunity to raise your credit score is one. It can also help put money in your pocket – if you use it correctly.

The key is to know how you will filter out the advices that will have a good effect on your financial life and those that will not. Here are 5 tips that should help you decide what advice you can follow and what you need to forget about.

  • Have a clear idea of your financial goal. If you do not have one, then go think of a goal. It will not only give your financial habits direction, it will also help motivate you to improve your financial situation. If you have financial goals, you simply have to determine if the financial advice that you are getting will bring you closer to it. If not, then you can choose not to follow.
  • Know your financial behavior and situation. If you are also aware of your current financial standing, it will be easy for you to determine if an advice will be good for you or not. It is also vital for you to understand your own personal behavior to see if it will bring you closer to your goal or not.
  • Keep your financial education updated. Financial literacy is an important aspect of financial growth. It is also give you the foundation to choose the advices that you will follow. So make sure you are updated not just on the concepts, but the latest news about the financial situation around you. That way, you can know if a certain financial advice is still relevant based on the current economic conditions in the country. Someone might be telling you something that used to be effective in the past but not under the present economy.

In the end, having a clear picture of what you want, what you are capable of and what is realistic will help you make smart choices about your money. Keep in mind that a certain plan may work well with someone but it does not necessarily mean it will do the same for you. Think about that before you really choose to follow a financial advice.

5 Routines to Practice Financial Fitness

Consumer running while carrying a briefcaseFinancial fitness is an important aspect of our financial literacy. Similar to athletes participating in several sports, they prepare long and hard for each game. They live with discipline and dedication in order to achieve their goals. The more they practice and prepare for their game day, the better their performance is on game day. They are able to address the needs of the game and quickly adjust as needed.

The same principle goes for consumers in their daily battle with finances. It does not happen overnight. You do not wake up the next morning with all your debts paid off, all your bills paid for, your 401(k) at retirement level and emergency fund that can last you more years than you need. Even if you win the lottery today, it will be a short lived cash happiness without being financially fit and literate.

The Bleacherreport.com even shows that heading to off season, the NBA teams are just as concerned with their financial fitness as they are in keeping their players fit and healthy. The teams need money to pay the salaries of their players and they need the players to generate income for the team. Both area of the business and sport needs to put a premium on fitness to ensure that they can continue their purpose.

Practicing Financial Fitness

One of the world marathon majors, the New York city marathon is one of the biggest marathon events being organized in the world. Now carrying a different sponsor, it used to be ING New York CIty Marathon but is now branded TCS New York CIty Marathon. The event is slated on November 2, 2014 and is set against another challenging course.

The race begins in Staten Island in Fort Wadsworth near the Verrazano-Narrows Bridge. It then passes through Brooklyn and reach the Pulaski Bridge signifying the racers are halfway in the course. The road track proceeds to cover East River via the Queensboro Bridge entering Manhattan. Runners proceed to Willis Avenue Bridge and returns to Madison Avenue Bridge before entering Central Park through Harlem down Fifth Avenue. The race concludes by going back to Columbus Circle near Tavern on the Green.

That is a full marathon circuit and anyone taking that course on November 2 needs to be physically fit. Relating that to financial fitness, that course is similar to the challenges we have to take on in life. As the runners race to the finish line, we practice financial management to get to our goal. But we do not just get up and run the race just as we do not instantaneously get to our financial goals. Aside from the having a financial health checklist, we need to prepare for the actual financial challenge.

Set a goal

The first step is to financial fitness is setting a goal. Just as the marathon runners in New York city has one goal in mind, which is crossing the finish line at a good time, consumers need to also have a goal in mind. This serves as a target to aim for and can regularly remind of the ultimate pay off on all your financial decisions.

Having a goal helps you keep your focus. Say the goal is to pay off your student loan as fast as you can. That goal will help guide you in all your financial decision making. Just like the runners whose main goal is to finish the race, their preparations are all leading to that purpose. They train to get fit to achieve that goal. Your roadmap to your financial goal should be built around your main purpose. It has to lead to your achievement of your financial target.

Budget routine

There are people who are having a hard time grasping and understanding how budgeting works. This plays an important role in practicing financial fitness. Putting together a budget is your blueprint to achieve your goal. It is your step by step process in making sure you are on the right track and don’t go astray.

New York marathon runners train with a specific routine. They follow specific strength training workouts and check their food intake. They measure their performance to check if they are improving and staying on course. This holds true for consumer budgeting.

Your budget needs to keep you on track in achieving your goal. It is there to remind you how much you need every month to cover your expenses. It also lists down all your expenses every month so you can quickly do an audit n where your money is going. It can help you curb unnecessary expense items and save you extra dollars every month

Get debt down

Most runners have an ideal weight that they need to get down to in order to run more efficiently. In financial fitness, think of debt as excess weight that is pulling you down. Physically speaking, it is best to shed of excess weight until you are comfortable with your own body and you can move and go around as much as you want.

This is the same with your finances. Getting debt down can help you move freely with your finances. It opens more financial opportunities and just gives you more legroom to go around. Debt ties up your income to interest payments which is eating up on what could possibly be your emergency fund or retirement fund.

Avoid temptation

There will be temptations along the way as you reach for your goal. For New York Marathon runners, it could be skipping a training day or cheating on their diet. It could also be going around not being serious with the preparations for the run like sleeping late and partying all night long. These temptations steer them away from achieving their goal.

Same goes for financial fitness. Steering away from financial temptations can be a challenge. Just like getting that new mobile gadget or putting in your online cart that discounted European cruise. These are temptations when it will keep you away from your main goal. If the money that was supposed to be extra payment for student loans is used to buy a new guitar just for hobby, then that is a temptation. But if your bread and butter is producing music, then that guitar can be an investment.

Get professional help

New York marathon runners are mostly professional runners. And majority of them have had professional trainers guiding them to their peak health and condition to take on the gruelling marathon course. This is the same for consumers on the road to financial fitness.

There are professionals out there that can help you make better decisions with your finances. There are those as well that can help you manage your debts better. They offer professional pieces of advice that you can use to get out of debt.

Benefits of Financial Fitness

Practicing financial fitness can yield benefits for the consumer. Some of these are:

  • Less stress. People who are financially fit are able to manage their finances better and are in top of the situation. This gives the peace of mind knowing how they are financially performing. Taking a prevention-stance is better than problem-solving mindframe.
  • Better health. Taking on a financially fit goal ripples out to physical fitness. It gives you more sleep and takes away worry. It gives you a good appetite and you are able to eat healthy food rather than wolfing down on ice cream and cake because of too much worrying.
  • Improved focus. You are able to concentrate as well on the task at hand rather than thinking of how to pay for the bill coming in at the end of the week rather than paying attention on your current task.

Investopedia.com tells consumers that fitness is a step by step process. This is made up of small positive financial habits that we maintain over the course of time. As we do it over and over again, we build it into our own routine and helps us get to our goal faster.

In most cases, your financial health is connected with your physical health. So if you want to be physically fit, you also have to work on your personal finances. Here is a video from NBC15 about financial health.

Consumer Debt Indicates Confidence

happy woman with groceriesConsumer debt is a common experience for most Americans. It is evident in almost every aspect in their lives. It is a companion in almost all major decisions in a consumer’s life. Financing college dreams would most usually equate to taking out federal and private student loans. This would pay for the tuition and other fees to graduate with a degree.

For consumers buying a car, taking out a car loan is just around the corner. It helps them finance the car instead of buying the car in cash. It allows them as well to not tie up their funds in just one property. Buying a home would similarly have the same concept as getting a car. Mortgage loan is one of the most used consumer loan instrument.

From college education to buying a car and owning a house, consumer debt plays a vital role in those major life points. But even in our everyday lives, consumer debt is evident in our use of credit cards. From buying groceries, paying for the monthly bills to dining out with the family, credit card use has been playing a big role in a consumer’s life.

With all these consumer debt, people have been finding themselves deep in debt and putting together a financial routine to tame big debt. But experts are looking at debt in a different light. Oddly enough, some financial experts deem debt as a good indicator of consumer confidence.

Confidence in growing consumer debt

NYtimes.com recently shared an article on how consumer debt is indicating growth in consumer confidence. From the study, consumer debt for the first quarter of 2014 stands at $8.69 trillion. Covering the same quarter last year, this is a 2% increase in debt. And looking further down the timeline, this is the only increase in consumer debt since the 2008 recession.

The highest point for consumer debt was way back in the third quarter of 2008. Debt stood at $9.99 trillion. After this point, mortgage began a steady decline because of homes being given up due to default. Add to this the fact that few new home mortgages are being taken out for fear of the market and economy in general.

The increase in debt is being studied in comparison with a decline in delinquent payments as well. The study revealed that the delinquent payments for credit cards during the first quarter of 2014 was at 8.5%. This is the lowest percent of delinquent payments since 20013. This is a great indicator of consumer confidence in personal finance.

The study shows as well that there is an increasing number of young consumers aged 22 years old to about 25 years of age that are taking out auto loans. This holds true for those that has student loans and those that do not carry any student debt. There are a few reasons for an increase in auto loan takers such as:

  • Stable fuel prices. A steady performance of fuel prices has been generally a great contributor in the increase of auto loans. Thedetroitbureau.com even reported that because of stable prices of fuel, there are shifts in consumer preference in car brands.
  • Interest rates. The rates for car loan are relatively low and this encourages consumers more to buy that car that they need.
  • Credit availability. This is an example of an economic supply and demand ratio. As more people are looking for lenders for an auto loan, more banks are offering the loan instrument. Extending the service to cover the consumer market that are on the lookout for auto loans.

Talking more about consumer debt,  mortgage had quite a decrease in the 27 years old to 30 years of age market. The survey even pointed out that a lot of it has to do with people struggling with student loans.

Student loans are affecting mortgage loans

Carrying big debt can lead to terrible things to  your family. Debt is is both prohibitive and limiting in nature. This does not limit itself to just mortgage loans, credit card and auto loans. In fact, one of the bigger industries at the moment is student loans. The industry has seen phenomenal increase over the past few years.

Westernherald.com shows that in the past 10 years, there has been a 300 percent increase in student debt. The industry is now at $1.2 trillion and growing. In 20013, the student debt stood only at $253 billion and steadily climbed up. In fact, if grouped with other consumer debt such as mortgage loans, credit cards debt and auto loans – student debt kept at increasing in a steady pace.

This year, there are about .85 college students graduating with a bachelor’s degree. Simple straight computation would indicate that each one of them would have an average of about $26,500 a college graduate. Even with lower delinquent payments for student loans, there are still about 30% in default for federal loans. This indicates that there are quite a large number of borrowers struggling with payment.

This is in fact one of the things that experts are looking at as a cause of a decline in new mortgages for possible borrowers with student loans. Simple logic dictates that having a big student debt puts stress on a borrower to pay. The chances are they send in  late payments or worse, delinquent payments. This would reflect negatively on their credit score. And a subprime borrower would either be slapped with a high interest rate because of the risk or be denied outright. These two scenarios would lead the borrower to put off a mortgage loan until the student loan is paid or their credit score improves.

This is a dilemma knowing how a college education benefits the income. There is evidence to support that college graduates are able to land better paying jobs than high school graduate. Unemployment for college graduates are at 6 percent as compared to 13 percent for high school graduates or those who do not have a college degree.

The student loan debacle can boil down to one point, managing any consumer debt has to be done with financial literacy at the helm. From the time the loan is to be taken out until the repayment period all the way to paying it off. Having the basic wisdom if the loan is really something that is needed to the budgeting of monthly income to pay off the debt requires financial literacy.

It is one thing to qualify for a loan but it is another to make the payments to maintain a good credit score. Having a good paying job will not worth much if you delay on your payments and use the funds for unecessary expenses. Having a goal to aim for can greatly help in steering you over to the right direction. Having a  budget as well to guide you in your daily expenses will bring you closer to that goal.

The increase in consumer confidence because of an increase in debt and decrease in delinquent payments is a good sign that people are able to maintain debt and make the payments on time. They are more aware of the financial responsibilities and the effects of mismanaging the payments. It can also show the confidence people have in the economy because taking out loans are long term responsibilities.

 

The Road to Financial Literacy

Woman looking at paperFinancial literacy is one of the key components to achieve a successful financial life. Some people have the right resources and opportunities but their lack of knowledge only led to the loss of what could have been a good shot at personal wealth. Financial literacy and opportunity goes hand in hand in ensuring proper finance management.

Having the right tools to manage your finances normally leads to a path of financial freedom as well.  Debt is often the product of uninformed financial decisions that can be compounded by unfortunate life circumstances. But focusing on those that can be addressed is an important step in getting out of debt and on to a road of financial independence.

Financial literacy in the country

Moneynews.com recently rated the states in the country in terms of financial literacy. New Hampshire took the top spot by ranking number one followed closely by Utah and Virginia. New Jersey and Minnesota rounds off the top five in the study. The study shows that these five states are conscious and serious about proper financial management.

The study used metrics to measure education and knowledge as well as daily habits and planning as well. The study also revealed rankings of different states according to characteristic:

Dropout rate for high school

Education at any level is important for an individual. It works with the character and determination of a person to succeed in life. It is not the only determining factor in success but it is a very crucial tool in reaching greater heights. There are also some schools teaching your kids about finances.

The study showed that New Hampshire has the lowest dropout rate of 1.2%. This is a good factor leading in why the state is leading the pack in financial literacy. It is also a good sign of a healthy educational system.

Emergency fund

Saving up for a rainy day is important in getting over unforeseen challenges life will throw our way. Medical emergencies or losing a job could be some of the events our emergency funds can address. Without it, you can get deeper and deeper in debt as your only option is to get a loan to have the money to survive.

Arizona tops the list at 53%. More than half its population knows the value of a rainy day fund. They build on it and put it aside hoping they never get into a situation where they need to use it. But if they do, then they have something to pull out. Indiana is at the bottom of the list at 33%.

Unbanked

Bank accounts are essential tools in safekeeping hard earned money. Better than just letting the funds collect dust at home, they earn interest in the bank. And you also almost the same type of access to your money in the bank just as you would put it in a drawer.

New Hampshire tops the list again with just 99.1% of residents having a bank account. This means they are well on their way to ensuring their funds are kept safe. It is also important for parents to tell their kids about their finances in case of emergencies, they know the financial standing of the family. Mississippi is rounds up the list with 15.1% of residents not having a bank account.

Sustainable spending habits

Making good use of the money you earn is a good sign of sound financial literacy. Maryland residents know about this as they top the list at 14%. Most of them know the value of a dollar and uses them wisely. Mississippi is again at last place with only 22% of its population guarding their spending habits. Proper spending habits can also make you confident about personal finances.

Borrowing rate

This is a great gauge on the risk profile of state. The lower the number, the lesser the chances of default and the better the credit score. It also echoes the health of the economy in a  particular area. Excluding bank rates, New Jersey tops the list with only 16% and Oklahoma is at the bottom with 40%.

Financial literacy occurs on two levels. Looking at the macro-perspective, consumers need to understand the policies that are formed and how it relates to their finances. They need to be updated with rulings and recent news that could affect their lives. On a micro level, consumers need to be aware of personal financial traits and characteristics. This can include saving, spending and even consumption. The understanding that encompasses these two levels can greatly contribute to financial literacy.

Financial literacy month

April was financial literacy month and it was a great time to remind us that at the end of the day, we are all responsible in our financial standing. It also made us realize the importance of saving and what it brings to our future. In light of this, MN.gov came out with some points on how to create our map to financial literacy.

  • Commit to financial change. Financial literacy starts with a commitment. It starts with the individual wanting to change and a commitment to stick to a lifestyle of sound financial decisions.
  • Check your financial standing. Doing an audit of your situation financially can get your started in the right track. It is important to know where you are coming from in order to prepare on where you want to be. Financial literacy starts with an honest assessment of one’s self.
  • Credit report clean-up. Making sure that your credit report is accurate will help you open numerous financial opportunities down the line. Check the accuracy of your report and if there are any problem, report them right away so they can be fixed.
  • Priority setting. It is crucial to lay out your priorities to reach your goal. Knowing where to start with and what to aim for first can guide you in the right direction. This can also help remind you of what financial journey you are on.
  • Set goals. Classifying your goals as short, medium and long term can help you prioritize even more. This can give you a clear direction on where to start and when you should end on a specific goal. It allows as well to put a time frame to your goals to push you even more.
  • Debt payments. It is quite a challenge to pursue financial dreams with a ton of debt breathing down your neck everyday. Paying down and paying off your debt should be on top of your list. Clearing up income payments that go to debt payments and channeling them over to your goals will help achieve them faster.
  • Emergency fund. As with everything, we need to expect things will not always turn out the way we want. There will be bumps along the way that could steer us off-course. The way to remedy this is to prepare for the unexpected. Build an emergency fund to help you through rough times and prevent them from getting rougher.
  • Retirement fund. You are only young once so save up for those winter days. Tackling retirement early will help you retire when you want not when you need to.
  • Track your expenses. Keeping tabs on where your money is spent is a good practice on financial literacy. It is easy to remember the big ticket items but those small repetitive ones are quite hard to tally up. By tracking them, you will see just how much you are spending on unnecessary items and can help you save up precious dollars.

Financial Literacy With Football

Man having financial problems

There is a good percentage of athletes that would benefit greatly from financial literacy classes. Investorplace.com listed some athletes that mismanaged their funds. Among which are six-time NBA champion  superstar Scottie Pippen who lost millions in bad investments. Allen Iverson also lost millions and at one point owed a jeweller more than $800 thousand. NFL superstars like Warren Sapp, Michael Vick and Terell Owens all lost money in misguided financial undertakings.

These athletes could make more in a year what ordinary people can make in a lifetime. That is why people compare athletes with lottery winners because of the financial gain in the sport. Of course, this is not to belittle their talents and skills and the hard work put in to sharpen those tools. But if they are not too keen in managing their finances, all their effort will go to waste. They could lose everything even before they retire.

Financial literacy with a twist

Coming off from Superbowl, quarterback Brock Osweiler of the Denver Broncos is the face of a new technique that aims to teach young people about making sound financial decisions as reported by Dailyinterlake.com. It is a fact that football is a national sport loved by many Americans including the kids. That is why when looking for ways to make financial literacy campaigns fly off with kids, incorporating it with football was the way to go.

Designed to be a video game and part of the classroom curriculum, “Financial Football” was developed. It is part of a statewide campaign to reach out to teens with the objective of teaching and improving financial management skills. The way the game works was that for every money management question thrown away, a correct answer would enable players to to choose from a variety of running and passing offensive plays.

Being an alumnus of Flathead High School, Brock Osweiler visited his roots where more almost 60 business and finance students waited to see him and play financial football. Reaching out to teens is a great time to talk about financial literacy as they are prepared to tackle financial responsibilities when they grow up. This would include funding college, buying cars, renting or purchasing homes and even starting a family.

3 Key things

Before starting the game, Brock Osweiler talked about the 3 things he learned as he was in his journey to practical financial literacy.

Budget. He pointed out that athletes do earn a lot. So much that some could think of the money as a neverending well of dollars. But no matter how much you make in a month – $400, $4,000, $400,000 or even $4M, having a budget is of utmost importance. It will show and guide you on how to properly manage the income that comes in. Without a budget, it will be as if you are walking in the dark and might he headed to bankruptcy like some athletes.

Affordability. One rule of thumb in making purchases is the fact that if you cannot buy the item using cash, do not purchase it. There are of course exceptions to the rule but sticking to this mantra will help you avoid unnecessary purchases. If there is a item that you want to buy and you do not have enough funds to buy it, save up for it rather than charging it to credit.

Educate yourself in terms of finances. Take classes, talk to you parents, save with your friends. Improving your financial literacy will benefit your finances in the long run. Brock Osweiler took several marketing, personal finance and even sports entertainment marketing classes just to be on top of his money. This is hard work but just like in practice, the harder you work on it, the better you become at it.

Here is a video on financial football:

Managing finances properly

With all these athletes losing money and even filing for bankruptcy a few years out of retirement, is there a way to prevent this? Financial literacy is a great tool in addressing this concern. Again, it goes back to the fact that athletes get so much money from salaries to endorsement deals that they sometimes make the most absurd purchases.

Investopedia.com recently released an article that aims to be somehwat of a refresher list for those lookiing to straighten up their finances. A brush up of financial literacy would always be a good step in proper money management.

Some of the things we need to be on the lookout are the following:

Starting point

This is similar to performing an audit of your current situation. It is great to have a budget and a goal that you would aspire for but the amount of work that you need to put in is dependent not only on the goal but also where you are starting from. Take for example a goal of buying house of your own. Knowing how much the property is will serve as your goal. If the house is valued at $30,000 then you would need that amount to but it.

But how much will you need to save up? $30,000? This is why knowing your starting point is a good idea to let yourself know how hard you still need to work. If you have not started yet then you really need to put up the whole amount. But if you have $10,000 in the bank and some assets and investments you can cash in that would all total $15,000 – that is already $25,000 right there. You would only need $5,000 more to get that house. From here, you are able to know how much more you need to set aside every month for the house,.

Needs and wants

It is essential also to distinguish needs versus wants. Putting a clear fine line between the two would help you prioritize purchases which is a backbone of financial literacy. Needs are the things you cannot live without. This would cover food, water, shelter, clothes, medicines and other items meant for your survival.

Wants could be different or in the same category. It could be water –  you need water but you want that $10 water brand when you have water at home that would do the same job of quenching your thirst. You have food but want to dine out in expensive restaurants to partake of the meals prepared by world-renowned chefs. Same with shelter and clothes, we need them both but want is staying in a community we cannot afford because of the stature it brings and wanting to buy signature clothes because they say so much about what you can afford.

It is important to satisfy the needs first and balance them with the wants in our life. In fact, our wants could even be a push to the right direction. If you have a car but you need a big SUV because the family is getting bigger and there is that brand you want because it offers the top of the line safety features – then work hard for it. If you cannot afford it yet, save up for it so you can buy it for your family.

Spending monitor

One of the things that is essential to maintaining a fool-proof budget is knowing where everything is going especially in the expense side. List them down to know where you can take out or reduce expense items.

Get rid of debt

Debt is very prohibitive in nature. It limits our capacity to save for emergency and even start and end early with our retirement plans.  Get rid of debt as early as possible to put income into good use.

Money management plays an integral part of our financial plans. Financial literacy starts with proper management of income and expenses coupled by making informed decisions along the way.

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