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How To Reduce Your Spending

Pair of scrissors cutting the word SpendingIs your most important goal to get out of debt or to buy a new car? Would you like to buy a house or a vacation home or send your kids to college? Regardless of what your goals are, you need to know how to cut your spending so you can put away more money to realize them.

It all begins with goal setting

It’s tough to know how much you need to put away every month until you’ve defined your goals. Let’s suppose one of your short-term goals is to get out of debt and that you currently owe $5,000 on three different credit cards. If you want to pay off all that debt in two years, you will need to make payments of about $208 a month. This means you will need to cut your expenses by that much or more.

Reducing your spending

Now that you know how much you need to decrease your spending, the next step is to make a budget that will get you there. You may want to use an online budgeting tool or smart phone app such as Mint.com or You Need A Budget. In either event, you’ll want to track your expenses for two to four weeks so you can see where your money is going. Once you do that, it’s time to sharpen your pencil and start making cuts.

The low hanging fruit

You’ll find that some of your expenses such as your rent or car payment will be difficult to reduce short term. But there are areas where you should be able to reduce expenses almost immediately. They’re what I call the long hanging fruit. For example, how much do you spend a month on groceries? I’ll bet you can cut that by at least 20%. There is any number of books available on Amazon and Barnes & Noble that could teach you how to eat more frugally.

Another area where you should be able to reduce expenses is in entertainment. How often do you eat out, go to movies, or just hang out with friends at a club or bar? Chances are you could save as much as $100 a month just by cutting back on entertainment.

Check out your other categories

Take a hard look at every category in your budget. I’m willing to bet there are other areas where you could easily reduce your expenses. How about clothing? Do you really need to spend an average of $150 a month on clothes? Probably not. How about your cell phone plan? Could you get by with fewer minutes and less data? I have an AT&T plan that gives me the minimum amount of data. The way I can make this work is by using my iPhone to access the web as much as possible via a Wi-Fi hotspot so that I’m not connecting through AT&T. Another area where you might be able to decrease your expenses is your auto insurance. Go to a site such as esurance.com and get some competitive quotes. You might be surprised at how much you could save just by switching companies.

I admit that learning how to decrease expenses can be tough and not much fun. But if you just keep reminding yourself about the goals you’re working towards, you should find it a bit easier.

How to decrease your debt

If you feel like you’re sinking into a quagmire of debt, you should know that there is help available. There is a company that can probably decrease your debt by 50% or more and help you become debt free in just 24 to 48 months. You can get more information by calling our toll-free number or by filling out the free quote form on this page.

5 Benefits To Turning Down Your Thermostat That Will Surprise You

woman looking at documentsWe’re sure you already know the major benefit of turning down your thermostat, which is that you will save energy and this means saving money. But did you know that if you turn down the thermostat so that you’re dropping the temperature just one to five degrees it will help you lose weight and get a better night’s sleep?

Get a programmable thermostat

The easiest way to turn down the temperature is with a programmable thermostat. You could set it to lower your temperature at night or when you’re at work. We have seen tests that show you will see a difference in your utility bill if you lower your home’s temperature for just four hours a day. Beyond this, here are five ways you could improve your life by lowering your home’s temperature that would probably never occur to you.

Prolong the life of your plants

Plants will actually live longer if you drop the temperature in your home to below 75°. We won’t get into the technicalities of this but suffice it to say that when the house is cooler your plants basically need less water. If you’re heading out of town this is especially important as it reduces the chances that you will come home to lifeless plants. Of course, this is assuming that you don’t have tropical plants.

Lose weight

Want to lose weight without hitting your neighborhood health club? We have a little-known weight loss secret. It’s that you can shed a few pounds just by dropping your thermostat below 70°. While you don’t want your house to be so cold that you’re uncomfortable and shivering, it can be cool enough that a light sweater would feel just perfect. Here’s how this works. Your energy expenditure increases as the temperature drops so you burn more calories or roughly 100 more a day. This increased energy can translate into an extra 3500 calories burned in just a few weeks. This means you would lose one pound.

Give your refrigerator and freezer a longer life

You know that your freezer and refrigerator work really hard to keep your food fresh and safe. But you could cut them some slack. When your house is below 65°, those big appliances don’t have to work as hard to keep your food cool. This can easily translate into fewer maintenance problems and a longer lifespan. The fact is that the lower the temperature, the easier it will be on your refrigerator and freezer. Also, try to drop the temperature down dramatically when you’re heading out of town for a few days. But don’t go below 55°F or you’ll be risking frozen pipes.

Get a better night’s sleep

If you lower your home’s temperature by about 5° – or below 65° – you’ll get a better night’s sleep. The reason this works is because when you go to sleep your “set point” or the temperature your brain needs to reach before going to sleep is lowered. If your room is too warm, you’ll have a tougher time reaching this point and falling asleep.

Just one little degree

If you’re serious about lowering your energy bill, think about this: A one-degree drop in temperature can reduce your energy bill by 1% to 3%. You could save even more money by dropping your thermostat by 5° to 10° while you’re asleep. You’ll not only get a better night’s sleep you’ll also lower your energy bill by anywhere from 10% to 15%.

Nest thermostatThe thermostat that learns you

You could make things even easier by investing in a Nest thermostat. This is a new, smart thermostat that actually learns how you live and adjusts the temperature in your home accordingly. It’s so smart it will ask you a few basic questions and will then optimize itself to your system and begin learning from your temperature changes. So instead of having to learn how to program a thermostat, it will program itself. Nest learns the temperatures that you like and then builds a personalized schedule for you. All you have to do is teach it your preferred temperatures for several days and within a week it’ll start setting them on its own. Nest also has an “Auto-Away” mode that will turn off your system when your home reaches the minimum temperature you choose when you set it up. And of course, the lower the temperature the more you’ll save on energy. If you have pets or plants, be sure to keep their needs in mind before you set the thermostat too low.

Turn it down at night

You can keep warm at night by sleeping under a thick blanket and with the temperature down to save money. Do this for a couple of nights and Nest will learn this and begin doing it for you. Just remember that if you turn the temperature all the way up your home won’t heat up any quicker. You could turn your thermostat all the way up to 85° but this won’t make the air come out of your finance any hotter. It just causes your heater to run longer. Instead you could use Nest’s “Time to Temperature” to determine exactly how low or high to set your temperature. You may not know whether you want the temperature to be 72° or 74° but it will be easy for you to see the difference between running your furnace for 15 minutes vs. an hour.

Watch for the leaf

The Nest “Leaf” shows up when you turn it to an energy-saving temperature. And the more often you see the Leaf, the more you’ll save. Nest will track your energy usage in its Energy History memory so you can see exactly how much you’ve saved.

What else you could do to save energy

We don’t know about where you live but we’re seeing extraordinarily cold weather. If this is also true for you, now would be a good time to not only invest in either a programmable or Nest thermostat but to also take stock of the other things you could do to stay comfortable and yet cut your energy bill. One of the cheapest and most effective things you could do is weather strip your windows and doors. These are where cold air most often finds its way into your home. You should be able to buy all the weather stripping and vinyl foam tape you would need for less than $20. If you have really old windows you might consider covering them with clear plastic storm windows. We have seen two packs of 36″ x 72″ plastic storm windows for less than $4.50. And 3M has a window insulator kit for five windows that usually costs about $18. These plastic windows are said to be easy to apply. Once you tape them in place, you simply use a standard hairdryer to shrink them tight and they should be wrinkle free and clear. 3M also says that one of these windows will increase the R-value of a single-pane window by 90%.

Unplug ‘em

Another way you can reduce your energy costs is by making sure you unplug appliances that you don’t use very often such as a second refrigerator in your basement or garage. This may sound silly but you should unplug your chargers when you’re not using them to charge one of your devices. You could also use a power strip to turn off your televisions and stereos when you’re not using them. This may surprise you but when you think these products are “off,” their energy consumption when on “standby” can be the equivalent of a 75- or 100-watt light bulb running continuously. You should also set your computers to hibernate and sleep. If you enable the “sleep mode” it will use less power when it’s inactive.

More ways to cut your electricity bill

Watch this short video to learn more things you could do to cut your electricity usage.

Let your computer to sleep and hibernate

And, finally, you could configure your computer to “hibernate” automatically after you have not used it for 30 minutes or so. This will turn the computer off but in a way that doesn’t mean you’ll have to reload everything when you switch it back on. When you allow your computer to hibernate, you will save energy and it‘s more time-efficient than shutting it down and restarting it from scratch. Of course, you should be sure shut it down when you’re through for the day.

6 Ways To Make Your House More Carefree

Man decorating houseAre you one of those DIY people who just love to do things around the house like paint fences or install doors? Well, we’re not and neither are millions of other Americans. If you’re like them and would like to reduce your home maintenance chores to a minimum there are things you could do. For example you could install vinyl siding over wood shingles and would never have to paint the exterior of your home again. This might require a sacrifice in the home’s architectural charm but just think how good you’d feel 10 years from now when all your neighbors are painting their homes and you’re sitting in your backyard sipping a cold one. In addition, there are six other things you could do to make your home more carefree.

Cellular PVC trim

This is a good looking trim made from the plastic used for plumbing drains and can be cut, shaped and installed just like lumber. The good news is that PVC doesn’t require painting though you could put on a couple of coats to add realism. If you do, you’ll need to repaint every 25 years versus the 5 to 7 years you have to repaint wood. If you choose to go with cellular PVC trim, figure on spending about $75 to trim a window or $3500 for your entire house. Both these prices are about 10% higher than wood trim.

Quartz countertops

These countertops are fabricated from chips of natural quartz mixed with high-tech pigments and resins. It is what’s called engineered stone but has hyper-realistic veining and a variety of versions that were unavailable just a few years ago. You can buy slabs of quartz countertops in just about any color at stone yards or find them online at sites like cambriausa.com. You clean these countertops using just a sponge. In comparison, you would have to seal a granite countertop annually and marble and limestone countertops sometimes have to be sealed twice a year. The lifespan of a quartz countertop is probably the same as your house – assuming you don’t drop something heavy on it. How much do they cost? You’ll pay about $4500 to $6000 assuming you have an average sized kitchen, which is roughly equivalent to mid-grade granite.

Solid vinyl fencing

If you put up a wooden fence, you will be in for endless repainting. Hollow aluminum and vinyl fencing needs no paint but doesn’t ever look the same as wood. If you want the look of wood, you should choose solid vinyl. This is a product made from the same cellular PVC used for trim. However, it has factory-applied paint. All you will need to do to care for this fencing is power wash it now and then. Its lifespan is at least 25 years. The cost? If you were to fence a small yard with a six-foot, open picket design, you’d be looking at around $12,000-$25,000. This makes solid vinyl fencing at least twice the cost of cedar. So chose this only if you’re planning to stay in your home for a little very long time.

Fiberglass entry doors

These doors are faced with thin, waterproof fiberglass skins that have been embossed to look as if they had traditional panels, moldings and even wood grain. Below the fiberglass is an insulating foam that’s three times as energy efficient as wood. You will need to touch up the paint of these doors or apply a fresh coat of varnish about every five years. But they will never crack, warp or split. They usually come with a lifetime warranty whereas wood door warranties are generally for only five years. The cost of these doors is about $2000-$4000 or more installed. This is 10% to 20% less than a wood door.

Clad windows

The most affordable alternative to wood windows is vinyl windows. But experts say that you would be better off with windows made from real wood that’s covered with an exterior aluminum skin. These come painted at the factory and are guaranteed for 20 years but generally will last at least 30 years. Compare this with wood windows that would probably have to be painted every 5 to 7 years. You would pay about $600-$1200 per clad window, which is 15% to 20% higher than unclad wood. But this can be a wash when you factor in the initial paint job for a wooden window. Plus, you will have a product that looks better, lasts longer and creates greater value.

Fiber-cement siding

These are shingles and clapboards that are cut from sheets of special cement mixed with wood fibers. They `won’t warp, right or cup. The individual pieces are typically painted at the factory then nailed one by one onto your house – just like the real thing. This yields an authentic, handcrafted look. The factory paint can last 15 years compared to the five or seven years for wood. The warranty is usually for 30 years whereas red cedar has no warranty but will last 20 to 50 or more years – depending on the climate. How much does this cost? Re-siding an average-sized home will be somewhere between $13,000 to $18,000 or about 10% less than wood when you include painting.

Video thumbnail for youtube video 7 Important Financial Lessons You Could Learn From Watching A TV ProgramFinancing those renovations

As you can see from the cost of these renovations, they’re not things you should do unless you intend to stay in that house for a fairly long amount of time. If you do decide to make some of these changes, you could finance them with a home equity line of credit or a home equity loan. Both of these come with pluses and minuses. Their biggest minus is, of course, the fact that they are basically second mortgages. Many financial experts believe that the best way to finance home improvements is with a home equity line of credit. These are variable-rate loans where you would be pre-approved for a certain spending limit and would then borrow money as you need it via special checks or a credit card.

Your monthly payments would be based on the amount of money you borrowed and the current interest rate. Homeowner equity lines of credit are like fixed-rate loans in that they have a set term. When you reach the end of that term, you must then repay the outstanding loan amount in full.

In comparison, a home equity loan is a fixed rate loan that you repay over a set amount of time at an agreed-upon interest rate. The interest rate and payment remain the same over the life of the loan. So if you were to get a home equity loan for $10,000 you would owe the entire $10,000 even if it turned out that you didn’t need all of it. On the other hand if you were to take out a home equity line of credit for $10,000 but ended up using only $8000 of it, that’s what you would owe.

The best place to get a loan

Whether you decide that a home equity line of credit or home equity loan would be your best option, a credit union would probably be a good place to get it. They generally offer loans at 1% less (or better) than if you were to get a bank loan. While credit union membership used to be limited to the employees of a certain company or members of an association like a union, many community credit unions are now open to everyone. You could find if there’s one in your area you could join by going to the website www.movecu.com/‎.

9 Things You Don’t Need To Buy Anymore

The New Year is upon us and with it comes those New Year’s resolutions. If one of yours is to cut costs to save and invest or pay down debt, we have good news. There’s a bunch of things you don’t have to buy anymore and here are nine of them.

1. Landline phonesMan with phone sticking out of head

Are you still paying for a landline? Many people have given them up and have gone exclusively to cell phones. One recent study by the Centers for Disease Control and Prevention reported that two in every five US homes (40%) had only wireless phones. And about 38% of the total US population or 90 million adults are now wireless-only. If we were to give up our landline, and believe me I’ve discussed this with my wife many times, we’d save about $75 a month or around $900 a year. Giving up that landline doesn’t mean you’re limited to just cell phones, either. Skype is free and even allows video chatting from and to any place in the world via your computer or smart phone.

2. GPS devices

I can remember when I was excited to get a GPS navigation unit I could use in my car. It was a little unwieldy to use but certainly easier than juggling maps. Today, you don’t need one of these devices at all and I’m always surprised to see them for sale. In fact, the demand for these systems has basically plummeted. They sold about 18 million here in North America in 2009 but only 7.5 million in 2012 according to recent research from the Swedish firm, Berg Insight. Of course, drivers still need navigation systems but they can be had for a lot less than the usual $70 to $300. Map apps are available for most smartphones and many can be downloaded free. Or maybe your automobile has a built-in navigation system as many of the 2013 model-year cars had them.

3. Cable or satellite TV

Are you still spending $100 or more a month on cable or satellite TV? You don’t need to. Nearly 58 million US households currently subscribe to cable TV but that’s a decrease of 17.6% from 10 years ago according to the research organization IHS. Why is this? It’s due to the many families who have “cut the cable” and gone to lower-costing options such as Netflix and Hulu that offer a lot of the same programs at a tiny percentage of the cost of cable or satellite service. If you have a computer you could buy a Chromecast dongle ($35), Apple TV ($99) or Roku ($39.95) and stream cable shows, sports, news and all kinds of other content to your HDTV and for just pennies a week.

4. Blu-ray and DVD players

The sales of Blu-ray and DVD players were down 20.1% in 2012 from 2011 or down 24.8% from 2010. You really don’t need either of these types of units when you could be streaming movies from Hulu, Amazon or Netflix to you HDTV. If you’re a gamer, you could use your Xbox One or Playstation 4 to stream films to your TV.

5. Two-year cell phone contractsMan interacting with smart phone

Just as cable TV is becoming less and less of a necessity, so are two-year cell phone contracts. The problem with them is that they come with more negatives than advantages. You can’t upgrade to a new phone without getting hit with a big fee or signing another contract. And a number of these plans come with fine print that could leave you paying more than the starting monthly price you were quoted in the store when you purchased the phone. Fortunately, that old consumer’s friend called competition has caused some new options. For example, you could chose to pay full price (the “unsubsidized” price) for a new phone without a contract. The phone will cost you a lot more than one that comes with a contract but your monthly service bill should be about half of what you’re now paying. You can find these devices at stores such as Best Buy, Walmart and Virgin Mobile as well as some of the regular wireless carriers.

6. Desktop and laptop PCs

We see stores still selling desktop PCs and always wonder who buys these dinosaurs. We see no good reason to buy a desktop computer when you could have a laptop and take all of your computing with you. For that matter, you may not even need a laptop, what with all the tablets now available. They offer most of the same functions as a laptop – watching videos, sharing photos and surfing the web – but are a lot less expensive. Apple’s iMacs (desktop computers) start at $1299 and MacBooks (laptops) start at $999, while you can get an iPad for $299. Of course, tablets aren’t for everyone. If you’re a graphic designer or stock trader and need a big screen, you may find it hard to give up that desktop or laptop computer. However, it’s interesting to note that the shipments of PCs worldwide fell 4% in 2012 compared to the year before and that this is lowest level since 2009.

7. Hotel rooms

The demand for hotel rooms continues to rise and so do their costs. The daily rate for US hotels averaged $110.59 in 2013, which is up 4.1% from 2012 and 12.6% from 2010. And it’s expected to increase to $115.68 this year. This has forced many travelers to seek alternative places to stay when they vacation such as renting an apartment or a home in their destination area. These options not only cost less per night than a hotel room but also provide more space. There are services like Airbnb and Vacation Rentals by Owner where you can choose from a collection of homes to stay in. Some of the owners of the apartments and houses even offer free airport pick-ups and drop-offs. However, there is one downside to this and that’s you may have less security.

8. Credit cards with miles or pointsLong line of credit cards (generic)

Some of the credit card providers have been boosting their rewards or points programs the past few years. But it’s now better to stay away from any cards with these rewards. Why is this true? Many of them require their cardholders to spend more money to receive the same “free reward” they would have earned previously with fewer points. In addition, many of these rewards cards come with annual fees that can range from $30-$75. What you might consider instead is a credit card that comes with “cash back.” This is a much more straightforward deal. You spend a certain amount of money on the card and get anywhere from 1% to 5% cash back. Plus, you can spend the cash anywhere you would like instead of being tied to airline miles or certain offers.

Digital photo camera9. Digital cameras

Remember when those little, sleek-looking, point-and-shoot digital cameras were all the rage? They made picture taking — you should pardon the expression — a snap. But today the demand for these cameras is slowly disappearing. It’s estimated that about 11.5 million were sold in 2012, which is down 44% from the prior year. This is according to the Consumer Electronics Association. The problem is that cameras are having an identity crisis. If you want top-quality photos you could enlarge to sizes like 2′ x 3′, you would want one of the larger DSLR cameras. If not, you would probably be happy to stay with one gadget – your smart phone – that also takes pictures. Plus, there are now cameras designed for specific kinds of people like those thrill-seekers who choose cameras such as a GoPro that captures action instead of just still pictures.

10 Offbeat And Sort Of Humorous Ways To Save Money

woman with piggy bankJust about everyone – with the possible exception of that lucky 1% – like to save money. You may have read a bunch of those money-saving tips like the importance of taking a  list when you go grocery shopping or using coupons. But here are 10 offbeat and kind of funny ways to save money.

1. Look through lost and found departments in various locations
Schools, public pools and libraries are great places where you can pick up items – literally at a steal.

2. Freeze your credit cards
Put those credit cards into small containers filled with water and freeze them. If you’re not big on self-control this would help keep you from buying stuff with those cards as you would have to take the time to thaw them out before they would be available.

3. Leave your wallet at home
When you go out to lunch or dinner with friends, pretend that you forgot to bring your wallet. Do this once a month and you would probably save a bundle of money over the years. However, you might also need to make new friends as your old ones may eventually figure out what you’re doing.

4. Fill up with food samples to your local gourmet grocery
If you’re not too fussy about sharing with other “shoppers,” you could lunch your way through your favorite gourmet grocery just by nibbling on free food samples.

5. Look for change in vending machines
Check all the vending machines in your area for change that people forgot to retrieve and for loose food items. But don’t ever shake machines, as this is likely to get the attention of the nearest security guard. If you watch vending machines carefully, you may find packages that are just ready to fall out so that if you buy the next one you get the first one as a free bonus. Be sure to check under the machines for coins as people sometimes pick up fewer ones than those they dropped.

6. Get rear-ended
If you are on a major freeway and run out of gas, you could get rear-ended. This could get you a new car courtesy of the other person’s insurance company

7. Take extra packets of the salt, sugar, sugar substitute and ketchup that are available at many restaurants. You might also help yourself to crackers, plastic utensils, napkins and nondairy creamer.

8. Take toilet paper from work
You can take toilet paper from where you work if you take only very small rolls that are almost finished. No one would probably ever notice this.

9. Keep all electric appliances in your home unpluggedUnplug everything in your home when you are not using them. If you leave appliances, printers and computers, etc., plugged in, they use phantom energy, which can really add up.

10. “Borrow” magazines from your dentist’s and doctor’s offices. If this makes you feel guilty, just take them back when you have finished them.

On a more serious note

There are some other kind of offbeat ways to save money that work and are not so humorous. For example, you could switch to cloth napkins. This would eliminate the need to keep buying paper napkins over and over. Just use your cloth napkins several times then toss them into the washer.

CheckYou should also not have to pay a dime for your banking services. There are many banks that offer free checking accounts and debit cards under certain circumstances. For example, you may need to have your paycheck automatically deposited into your account to qualify for free checking and a free debit card but that can actually be very convenient.

Forget movie theaters

Skip the theater and subscribe to a service such as Netflix. It offers two options – to either get your movies on DVD or to have them streamed to your computer. We have the streaming type of subscription that costs only $7.95 a month. And no, you won’t be able to get movies at the same time they’re in theaters but if you’re a bit patient, you will eventually be able to see them.

Join a car pool or ride share

Want to cut down on your transportation costs? Maybe you could join a carpool and use it several times a week. If you can find just one other person where you work that lives relatively close to you, the two of you could ride share, which would cut your fuel costs in half. Failing all this, there might be public transportation close to you that you could take to work several times a week.

Consolidate your errands

Do you consolidate your errands or just drive around helter-skelter several times a week? If you do all of your errands at the same time, say, once a week you will definitely cut down on your gas cost. If you do this, be sure to start with the store or errand that’s furthest away from your home and then work your way back.

Have a separate account

If you get money above your normal earnings – in the form of a gift, a bonus or a tax refund – stash it away in a separate checking or savings account. Then use the money to pay down your debts or to cover unexpected expenses.

Cut down on meat

Try eating less meat. You don’t have to be a vegetarian but if you have breakfast for dinner – with eggs and pancakes – or substitute beans for meat at dinner, you will definitely save money. We eat a lot of chicken in place of beef and figure that it saves us anywhere from $3-$5 a week. And we now eat more fish but that’s for health reasons more than to save money.

Finally, here’s a video with some other helpul tips for saving money.

How To Prevent Creating Holiday Debt

Young woman holds a gift wrapped in red paper, isolated on whiteThe holidays will soon be upon us and with it comes the possibility of piling up new debts. It can be hard to avoid this because it’s easy to get caught up in the spirit of gift giving and before you know it, you’ve added a big hunk of debt to your credit cards. This leads to what some people have come to call the “January hangover,” when those credit card statements begin arriving. The good news is that there are ways to prevent that January hangover and without stinting on your gifting. Here are seven tips that could help.

Tip #1: Make a budget

Don’t start shopping until you’ve done your math and determined how much you can afford to spend. This doesn’t have to be complicated. Just take whatever money you’ve saved for the holidays and add it to your discretionary cash – or that money you don’t need to live on. Then divide all your expenses into this amount. If you have a problem figuring out where to start, review how you spent money last year. There is no hard and fast rule for budgeting in general. The best way to handle it is if you overspend in one area, just cut back in another. As an example of this, if you want to host a big holiday dinner, you might need to cut down on your gift giving. Also, don’t make the common mistake of not accounting for all expenses such as stamps, holiday cards and end-of-year gratuities.

Tip #2: Use a smart phone app

If you think you might have a problem sticking to your plan, get a smart phone app such as the Gift List Budget Shopper. This would help you stay on track. If you need some extra motivation, get a credit card payoff calculator at a site like Bankrate.com. Use it to see how long it would take you to reach a zero balance based on your Christmas spending. This could be a great motivator to staying on your budget.

Tip #3: Don’t try to gift everyone equally

Be sure to write down for whom you’re shopping and how much you want to spend on that person before you begin browsing. Your gift giving doesn’t have to be divided up equally. And you don’t have to match what other family members are spending. You might ask everyone in your family to set a price limit. Or you could agree to buy only for the children and then do a gift exchange such as a Secret Santa for the adults. You can stretch your budget even further by buying presents with unused gift cards, cash back, airline miles or points from some other rewards program.

Tip #4: Give your time instead of a gift

Remembered that when it comes to a gift, it really is the thought that counts. Instead of buying gifts, try making them. If you’re a bit tech savvy, you could create an online photomontage. If you’re a good chef you might cater a special meal or invite a relative’ s kids over for a sleepover so that he or she could have an evening out. If you agree with us that the holidays are about families being together, you could make them extra meaningful by putting together a family volunteer project such as working at a local soup kitchen or collecting coats for the needy. An experience like this will be far more memorable than that super deluxe cookie jar and more valuable than any other gift you could give.

Tip #5: Don’t take your emotions with you

It’s your emotions that can take the heaviest toll on your credit card debt. This is especially true in the case of children who show so much enthusiasm when they receive your gifts. Try to leave your emotions at home. If you don’t, this can cause you to buy unnecessary stuff. The four most common emotional triggers for buying are convenience, security, elation and envy. If you can know and recognize these triggers when you’re out shopping, this should help keep things in check. And before you make a big, unplanned purchase, go home and think it over for 24 hours. You might be surprised at how that that fever to buy fades away with time. Here’s a video that explains more about gifts and emotions and what you could do to control your holiday spending.

Tip #6: Don’t shop at the big-name stores

It’s usually much more costly to shop at big-name stores. Do your Christmas shopping instead at discount stores, dollar stores or even second-hand stores. It’s possible to find some really great and memorable gifts at antique galleries and for not much money. You could also do much of your shopping online where it’s relatively easy to compare prices. Plus, you may be able to find money-saving coupons and you will definitely save gas money when you shop at home.

Tip #7: How to handle tipping

While you do need to show some appreciation to those people who help you during the year, it’s perfectly okay to dole out small, inexpensive gifts in place of money. You could do home-baked goods or for those whom you tip at each visit – like your barber – a thank-you note might be sufficient.

Tip #7: Seek helpFreundlicher Empfang

If you find yourself deeply in debt and are concerned about what Christmas may do to your finances, you might try consumer credit counseling. It’s likely that there is a credit-counseling agency in your area. If not, it’s easy to find one online. The reason this can help is because you will have a credit counselor who will analyze your spending and income and help you develop a budget or plan for controlling your spending. Of course, in the final analysis it will be up to you to implement the plan but at least you will have some professional advice that could help you stay on track and not create a new load of debt.

To get more ideas for saving money on your holiday gifts, check out this video from Good Housekeeping.

9 Simple Ways To Save Money Today

woman with a groceries bagIf you’ve been on the Internet looking for ways to save money, you’ve probably found dozens if not hundreds of suggestions. The one problem with most of these tips is that they can’t help you short-term. For example, you might have read articles suggesting that you track your spending for some amount of time and then create a budget. That is good advice. But it’s not going to save you money immediately. In fact, it might be more than 60 days before you see any real savings. And then there are tips such as sell your car and buy a cheaper one. Again this will save you money, but not today or even this week and maybe not this month. However there are simple things you could do to save money immediately and here are 9 of them.

1. Make dinner at home

When you eat out, you’re basically paying the restaurant’s rent, maintenance and food costs. Plus if you tip, you’re just tossing your hard earned money at the wait staff or delivery guy. If you do this often enough, it will add up to a lot of cash. Instead, make your dinner at home and cut out all those other costs.

2. Make a triple or quadruple batch

If you’re already cooking your own meals, be sure to make a lot of portions. Try to make at least triple or even quadruple batches and then freeze the ones you don’t consume that day. You can then bring these out for quick dinners or lunches when you need something simple. One of the best of these is to make a casserole where you cook the entire thing and then just bring it out and toss it in the oven when you need it.

3. Go for a walk before dark

Going for a walk is one of the best things you can do. It’s not only light-to-moderate exercise, which is good for your health, it’s absolutely free. If you turn off your lights before you leave as well as other energy-sucking devices (like your computer or your television) you will definitely save money. In fact, if you save 1000-Watt hours while you walk, that’s a saving of $.15 or so and is pretty easy to do. If you do this routinely, you could see your energy bill drop by about five dollars a month.

4. Read a book

When you’re ready to relax at the end of the day, read a book instead of turning on the television or computer. Books can be very entertaining and even teach you important stuff. You can also get them free at your local library. Plus, they don’t require any energy to operate.

5. Open your windows

The only time when it really makes sense for most people to use their furnaces or air conditioners is during the evening in the winter and the hottest days of summer. If you can tolerate a slight variation of temperature at night during the summer, just open your windows and turn off your climate control. This can mean a huge reduction in your energy bill.

6. Clean your pantry

If you’re like us, you probably have a pantry filled with items you purchased for some specific recipe that then got pushed to the back of your pantry where you’ve completely forgotten about them. If you give your pantry a good cleaning, you will be able to see everything you have there. You may throw some of it away or be able to use other items as the foundation for future recipes in the coming weeks.

7. Make a meal plan

Another excellent way to save money is to make a meal plan for the next week and then create your grocery list based on it. This is actually fairly easy to do. Just make a grid that has seven rows – one for each day of the week – and three columns – for breakfast, lunch and dinner. Then, go through the items you have on hand and those that are on sale in your favorite supermarket and figure out some recipes using those things. Write the meals into your meal plan, then in the next column write down the things you will need to buy to do those meals. You’ll have your grocery list for the week! Then here comes the second important part – be sure to stick to it when you’re at the store and avoid all impulse purchases.

If you’d like more information about creating a meal plan, just watch this short video.

8. Your bills

Once a year or so, make copies of the most recent version of your monthly bills. Then walk step-by-step through them. Do you understand all of your charges? Do you think that each of them is necessary? If you answer either question with a “no,” then you need to call customer service. Ask to have anything on your bill removed that you don’t want or need

9. Get to know your neighborsTwo Happy Couples

This might surprise you, but you should really talk to your neighbors. Try to get to know them at least a little bit. This will pay off time and time again. If you know your neighbor and need a special kind of wrench you can just ask to borrow it instead of buying it at a hardware store. You say you need a bit of sugar or a hand with something? Knowing a neighbor can stop you from throwing money at those little purchases that can add up over

9 Proven Ways To Earn Extra Money To Pay Off Debt

If you’re facing a wagonload of debts, what’s the worst thing you can do? It’s simple. The worst thing you could do is ignore them. You might act like an ostrich and stick your head in the sand – at least figuratively speaking – but that’s no solution. You might want to ignore your debts but your creditors won’t. The more you try to ignore them, the worse things will get.

man shouting at phoneThose maddening debt collectors

The first thing that will happen if you try to ignore your debts is that you’ll begin receiving calls from debt collectors. And these will not be fun calls. Debt collectors are generally paid on a commission basis. If they can’t collect from you, they won’t earn much. This makes them highly motivated to use any and all possible tactics to get you to pay off that debt.

The two sides of the coin

There are really only two ways to pay off debt. You can find ways to cut your spending and use the money you free up to pay down your debts. Or you could earn more money and use it to pay them off. Actually the people who are the most successful in paying off debts usually do both. If you can’t or aren’t willing to cut your costs, there are ways you could earn extra income and here are nine of them.

  • Get a second job
  • Make money online
  • Sell crafts or vintage items on Etsy
  • Do odd jobs
  • Sell stuff on eBay
  • List services and sell stuff on Craigslist
  • Build an online store
  • Change your withholding
  • Get a seasonal job

Getting a second job

Of all these alternatives, probably the best and fastest way to pay off debt is by getting a second job. There are certain industries such as food service and hospitality that almost always have part-time jobs available. As you might guess, these are not high paying jobs. In fact, most of them pay something in the area of $10-$12 an hour. That may not seem like much but if you were to work 20 hours a week at $12 an hour, you would gross $240 or $960 a month before taxes. Assuming that you would net about $800, you would be able to pay off $9600 of debt in a year or $19,200 in two years. This means that if you owed $20,000, you would be essentially debt free in 24 months.

Making money online

Have you ever thought about Internet marketing? There are people making six figures a year (or even a month) doing just this. If you’re smart and were just a little bit lucky you could be earning $1000 a month in just a few months by doing what’s called affiliate marketing or by creating and selling your own information products online. Spoiler alert – many people have spent years trying to master Internet marketing and have never succeeded. If this interests you, you need to study the subject extensively and not just put up a website and expect to be generating hundreds of dollars in just a few weeks.

The new big kid on the block

If you’re good with crafts you should sell your items on Etsy. It’s become the new big kid on the block over the course of the last year as more and more people have turned to it to sell handmade and vintage items. Plus, Etsy charges just $.20 to list an item for up to four months and takes just a 3.5% commission if it sells. It is now a community of 15 million creative businesses and buyers. It offers a number of different promotional tools that could help you get an abundance of new customers. In addition, vintage items only have to be 20 years old so that 25-year old table lamp sitting in your garage could actually be worth real money.

If selling handmade, crafty items interests you, here’s a short video about making money on Etsy.

save money signTips for saving money

Don’t forget the other side of the coin, which is to find ways to save money and pay off your debt. When they put their minds to it, most people can find ways to cut their food costs by 50% or better. What’s the secret? Use coupons. Become an astute coupon collector and you might be able to get $100 worth of groceries for $20 or less.

How much are you spending on entertainment? This is another area where most people can easily cut costs. Do you have cable or satellite TV? There’s really not much of a reason to have either of these. You could get most of your television programs and movies downloaded to your computer and streamed to your TV using services such as Netflix, iTunes, Amazon prime and Hulu. For that matter, Google recently introduced its new product called Chromecast. It costs just $35, plugs into any HDMI port on your TV and enables you to stream Netflix, YouTube and Google Play content from your PC to your TV. Google says that it’s negotiating with other providers and will soon have even more content available via Chromecast. If that’s not enough, you can probably get your local TV channels free through the air. All local stations are required to broadcast digital, high-definition programming that you could pick up simply by buying an inexpensive antenna. This would get you all of your local news as well as all network programming –free.

Where else could you make cuts?

The list of categories where you could reduce your spending is probably as long as your arm. In fact, there may not be a single category where you couldn’t make cuts if you put your mind to it. But that’s the secret. You need to review all of your spending with an eagle’s eye. Do this and you should be able to reduce it by at least $200 a month without breaking a sweat.

Four Steps To Financial Freedom

financial-freedom1What do the words “financial freedom” mean to you? Too many people this is synonymous with the words “debt-free.” For others, it could mean the freedom to quit their jobs, to roam the world on a sailboat or to start their own business. Regardless of what you think of when you hear the term “financial freedom,” there are steps you can take to achieve it.

Define your goals

The first step towards financial freedom is to define your goals. You should have both short- and long-term goals. They should be both specific and achievable. The reason to have short-term goals is to have goals that you can achieve in a reasonable amount of time to help you stay motivated. Let’s suppose that your long-term goal is to retire at age 55 and you’re now 30. That’s a 25-year time span, which is a long time to stay motivated an on track. However, if you add a short-term goal of, say, a two-week trip through Europe, you will be able to see you’re making progress towards that goal every month. Once you achieve your first short-term goal, you will need to create another one, so again you’ll be able to see you’re making progress

Make a plan

Once you have defined your goals, the next step is to determine how you will achieve them. For example, I read recently that if you want to have a good retirement, you should save 8 to 10 times your annual salary. This means if you’re earning $65,000 a year you’ll need to save around $520,000 for a decent retirement. If your long-term goal is to have a happy and stress free retirement, you need to make a plan as to how you will accumulate that $520,000 or whatever.

Create a budget

Step three in achieving financial freedom is to create a budget. To do this you will need to identify all of your spending for probably a month. There are some great software programs and smart phone apps that will track your spending and even divide it into logical categories such as entertainment, healthcare, insurance, food, entertainment, debt payments and especially savings. Next, you will need to allocate a percentage to each category. As an example of this, you might allocate 25% to 35% of your earnings for your housing and 5% to 15% for food. As a final step you will need to scrutinize each category to find areas where you could make cuts. Remember that you’re working towards goals and the more cuts you can make in your spending, the more money you will have and the faster you will realize them.

Pay off your debt

If you’re like most of us, you’re probably now asking the question “How can I put more money into savings when I have so much debt hanging over me?” While it is possible to both save money and pay off debt, most people find this very difficult. A better solution for most of us is to pay off your debts first. It’s nearly impossible these days to get much more than 1% or 2% any kind of secure investment, while you your credit card debts probably have interest rates of 20% or even higher. It doesn’t take a lot of math to figure out you’d be money ahead to pay off your debt, which would free of money you could sock into your savings.

Keep the faith

Making a plan, creating and staying on a budget and paying off your debt is usually not much fun for. However, it’s a bit like weight training. The more you work at it, the easier it will become. Just keep the faith and stick to your plan and you will realize your goals.

How To Get Out Of Debt While Still Adding To Your Savings

Saving pennies.There is the age-old question of which to do first – add to your savings or pay off debt. Fortunately, the true answer is all of the above. You can be paying off debt while at the same time adding to your savings. This will require a rock-solid commitment on your part but it can be done. And here are five things you can do to accomplish this.

Make a budget

Every financial expert I’ve ever read says that every financial plan needs to start with a budget. You need to sit down, think through your spending and write everything down to the last penny. You should reduce as many of your unnecessary expenses as you can by buying just what you need. A good rule of phone is to budget 80% of your income for debt payments and to save 20%.

Get credit counseling

Many debts including student loan debts can be consolidated into a lower payment. You could go to a nonprofit credit-counseling agency that would negotiate lower payments with your creditors. Most of these agencies will help you create a plan for paying off your debts and then submitted to your creditors. Assuming they all approved it, you would then have just one payment to make a month to the credit-counseling agency. Just make sure that you get an affordable payment plan and that you don’t end up paying higher interest rates.

Save money by consolidating your debts

If you could get a debt consolidation loan, this would probably save you money that you could use to grow your savings. This is especially true if you have enough equity in your house to do a refi or get a second mortgage or homeowner’s equity line of credit. If you were able to get one of these loans at 4% or less and with more favorable terms, you should end up with a monthly payment that would be much less than the sum of your current monthly payments. I have seen cases of homeowners who were able to do refis that save them several hundred dollars a month.

Automate your payments

One good way to make sure that you’re saving 20% of your income a month is to automate things so that a part of your income goes directly to your savings or retirement account. To do this, all you would probably have to do is create a recurring payment for a certain percentage of your paycheck to go directly to this account.

Save every day

Did you know that you probably overspend or overpay on items you wouldn’t even really miss? For example, it costs less to shop for seasonal foods and a farmer’s market. It also costs less to buy staple items such as shampoo and detergent at a discount store rather than at your grocery store or one of those high-end stores.

Create mini goals

If you are used to indulging yourself with luxury items, it can be tough to get into the habit of paying off debts. This is why it’s important to have mini goals and rewards. A mini goal might be to pay off half of the credit card debt or to add a certain amount of money to your savings account. You should also have savings set aside for special events. Then when reach a mini goal you could reward yourself. The reward could be a night at a favorite restaurant or a dinner out and a movie. And you won’t have to feel guilty because you can tap into your special events savings to pay for it.

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