Saving and budgeting

We have all heard all sorts of advice about saving and budgeting. Experts tell us what we should be doing and how we should be doing it the best way. Family members tell us what we should be doing and how we should be doing it. Friends who seem to be doing better financially than we are will tell us how they have do in and what has worked for them. We should save more. We should save less. We should save three months of income for emergencies. We should have at least a years’ worth of savings. We don’t need savings as long as we have income, investments and credit. We should never rely on income investments or credit to live on. It all gets confusing and overwhelming. As for budgeting, that just plain seems scary and hard to stick to. Let’s look at 5 ways to think about saving and budgeting that will make them seem clearer and less confusing.

1. It’s never too late to start saving – In a perfect world we would have all started to save at age 20 and would have added regularly to it every month from then on. Obviously we don’t live in a perfect world. There are all sorts of circumstances and situations which get in the way of saving. There is nothing wrong with that. There is also nothing wrong with starting to save whenever you can. Starting at age 40 might not be as good as starting at age 20, but it is a whole lot better than starting at 50. The best time to begin is right now.

budgeting

2. There is no such thing as too little – Some people don’t want to start saving because by the time they have paid all of their other bills they are only left with a little bit of money, so it doesn’t seem worth it. This is silly. Even a little bit makes a big difference. You have to consider that something is better than nothing, that you are benefiting from the interest which is letting your money grow and you are getting in the habit of saving, so you will be able to save more when you start making money. Start saving now, no matter how much you can save!

3. Don’t save too much – This sounds like contrary advice, but it really isn’t. Saving is important, but so is living today. If you are saving so much now that you can’t do or enjoy anything, then you begin to dislike savings. You will resent it and you will quit doing it. You are much better off saving a reasonable and sustainable amount now and continuing at that level for years to come.

4. Don’t think of it as a budget – Budget sounds like a negative word. It is all about constraints. Try calling it a spending plan instead. That sounds so much more positive and will make it easier to stick with it over the long run.

Saving Money in Today’s Rough Economy

Saving money nowadays is more important than never and many households are trying to cut back where possible. Saving money is more than controlling what you spend. It goes into making sure your money is spent wisely and put where it’s needed the most. It’s important to save money for a number of reasons and here are some effective tips that can help you.

Evaluate Necessities and Luxuries

We all want to have nice things, but when you think about what you spend your money on, chances are some items are not always a necessity. Did you really need to spend money on those heels? Chances are you could have lived without them, and even if it was a special occasion if you had to cringe while items were being rung up they were not needed. Consider what you can live without as opposed to making sure bills are paid beforehand.


Plan a Budget

Make a list of all income that comes into the house. Add up your expenses that need to be paid out each month. Stick to keeping bills paid and at the end of the month if there is money left over, it might not be too bad to spend a little within reason. This all sounds simple but in reality people have a hard time sticking to a budget.

Eliminate Credit Cards

Many people that have credit cards find themselves in debt. They think they can put purchases on credit cards but that just adds to your monthly bills that need to be paid every month. Eliminating credit cards eliminates any temptation to spend money.

Cut Back on Driving

If you need to run an errand, try and plan a day when you can run all of your errands rather than one running one errand at a time. This saves money on gas since gas prices seem to be steadily rising.

Plan Accordingly on Groceries

Using coupons may seem like something time consuming. While some coupons are only for a mere few cents, every little bit saved can help. If you plan your grocery list based on coupons you can save more money. Check local ads and see where items are being offered at the best price and consider shopping at one place rather than 2 or 3. Coupons can be printed out from the internet nowadays which can help save more.

Also, buy only non-food items in bulk. Many people think they save money by buying meat, soda, juice, and more in bulk but in fact you go through it faster. This means you’re making added trips to the store and spending more money.

Shop Clearance Sections

If you need clothing for yourself or for your children, clearance sections are a lifesaver. Try not to go overboard and you can shop in the off season to save even more. For example, shopping for winter clothes in the summer can help you save more money.

These tips can help you save money and spend less in today’s economy. There are several other ways that many households are figuring out that have helped put more money in the bank.

The Ultimate Guide to Guarantor Loans

Introduction

The recent recession has affected almost everyone in one way or another. Some have been forced to take on extra hours at work while others have found themselves without a job at all. The recession has also prompted the banks to make a number of changes, one of the most significant surrounds their loans and more specifically; the lending criteria of their loans.

Prior to the recession, getting a loan via the bank wasn’t particularly tough, however once the recession hit – this all changed. The decrease in disposable income meant that many were unable to pay their loan; leaving banks struggling. This forced the banks to make significant changes to their lending criteria in a hope to reduce the amount of customers that fall into arrears on their loans.

What this means is that someone who would have previously been approved for a loan via their bank, are now being declined, forcing them to look elsewhere. This is where guarantor loans come in.

The basics of guarantor loans

Guarantor loans are a type of unsecured loan meaning they do not require the security of a home or any other physical asset. Instead, guarantor loan lenders will require the applicant to provide a friend or family member to support the application. It guarantor signs an agreement to say that they will make payment on behalf of the applicant if the applicant is ever unable to do so.

The guarantor must be a homeowner who has a good credit history and is receiving an income that is deemed sufficient to afford the repayments of the loan. The age criteria differs from lender to lender however generally the guarantor must be between the age 25 and 75. The majority of guarantor loan lenders will offer between £1000 and £5000 that is repayable over a term of 1 to 5 years.

The interest rates

Guarantor loans were first introduced to the UK unsecured loan market in a hope to bridge the gap between the low rate banks and mainstream lenders and the high interest doorstep lenders. The APR of guarantor loans is generally seen as quite high. Fundamentally, the rates reflect the risk of lending to those who may have missed payments and even defaulted on credit commitments in the past.

Some lenders will offer fixed interest rates, which means that your repayments will stay the same throughout the full loan term (providing you keep up with the repayments). Other lenders will offer variable rates, which means they are subject to change in accordance with the Bank of England Base Rate, however these changes are usually quite insignificant. Fixed interest rates are much easier to budget for as you always know exactly how much you’ll be paying each month. Continue reading “The Ultimate Guide to Guarantor Loans”

Save Money – Choose an Online Only Bank!

Here’s something you probably already know: we’re a mobile society that’s always on the go. There’s just no getting around that. Yet there does come a point where you have to look at how well things fit into your new mobile life. If you’re on the go, shouldn’t your banking be too?

That’s the subject of debate in a lot of banking circles. Getting account info on your phone is cool, but there are security issues that every banking institution has to think about. It can’t just be a matter of customer convenience. Your sensitive financial information has to be protected at all costs. Hackers could get your information and have a field day. Not what you really want to look forward to at all.

The conversation naturally tilts towards online banking. After all, it isn’t like we don’t know how to protect customer information online. We’ve gotten good at encrypting things. Online banking is full of regulations involving security, so you wouldn’t have to worry too terribly much about your information.

Online banking has been around for a while now, so it’s not like you’re missing out on too much. You can get an online bank account without any stress, giving you a new world to explore. If you bank from a physical location, you probably have online access to your account as well. If you’re someone that travels a lot though, it might be wise to think about an online only bank. The overhead is less which means that you can get better rates than a traditional bank where the overhead is so high.

The nice part about online banking is that it’s available anywhere you have an online connection. So if you happen to move away from that particular location where the physical bank is located, you’re not going to want to drive all the way back just to use their services.

In a troubled economy, cutting costs is a good thing. Services that we like in the online banking sector include ING Bank and Ally Bank. There are plenty of other ones out there, so make sure that you truly explore all of your options.

Separate Your Business From Your Personal Life Now!

Business Executives Running in a Race

Running a business is the dream that many people have, and it’s definitely a good dream. So when you finally get a chance to make it a reality, you’ll probably want to take steps to protect it as much as you can. After all, why would you want to make any type of mistake that’s going to keep you from enjoying the type of life that you’ve always wanted? Thankfully you do have a lot more options than you might realize to protect your business.

It all starts with making sure that your business life is separate from your personal life. Again, this might seem obvious, but we’re always surprised to see people that aren’t incorporated. Incorporation is something that’s pretty straight forward, and it tends to make your life a lot easier than if you were just trying to group everything together. If you aren’t incorporated and you don’t have all of your business life separated out from your personal life, you’re going to end up risking a lot more liability than you should.

This is because when your business life and your personal life have no separation, you’re basically opening up your personal items to seizure if you lose your case! That’s something that no one wants to go through.

The more separation you can build in, the more obvious to the IRS that you’re running a business. This means that the IRS is a lot less likely to throw out all of those expenses that you’ve claimed, or other things that are designed to lower your bill. If they feel that all you’re doing is a hobby, then you’re not going to be able to do much of anything when it’s time for tax season — you’ll lose every time.

Save yourself the trouble — separate things out. Here’s what we suggest:

Incorporation would be the first thing that we suggest. It makes getting bank accounts and even business credit so much easier. If you lump everything together, then you’re going to have the problems that we already listed. However, if you incorporate properly, you’re going to be able to shield your personal assets in case you have to declare bankruptcy with your business or even if you have to deal with litigation.

Make sure that anyone can go back and see what your personal money is and what the corporate money is. If you are incorporating, that means that you will want to have an obvious salary being paid out to you. Once you grow, you can invest in payroll software that computerizes the whole process. This way if you’re audited you have to only go through a few screens and print out exactly what money went where.

Staying organized is just one more facet of running a business — are you ready for you? Start separating your business life from your personal life for the best results around!

5 Reasons To Compare Easy Access Savings Accounts

Comparison shopping isn’t just a buzzword anymore — for consumers, it really is a way of life. There isn’t a single service that you can acquire that doesn’t improve based on comparison shopping. Car insurance? You could be paying a lot more than you think just by taking the first offer that you see. If you are looking for someone to come out and make improvements to your home, you will pay a lot more by hiring the first person that you find instead of making the contractors compete with each other. That’s something that tends to create a lot of problems down the line that can be avoided by shopping around. A lot of people feel that comparison shopping makes them appear cheap but that’s just not the case at all. It can really make all of the difference to find the ultimate deal. The money that you save can be funneled into another project that you have in mind, like saving for the future.

Speaking of saving for the future, you would do well to choose the best easy access savings accounts. There are five reasons to compare easy access savings accounts.


First and foremost, you will miss out on interest if you don’t. Interest in terms of savings accounts equals money every time. If you take the first offer that you’re given, you’re going to be missing out on a lot of interest over time. That could be the difference in when and how you make all of your financial goals happen.

The second reason to compare easy access savings accounts is that you never know when you’re going to find a bonus rate or another introductory offer. Banks want to gain your business for the long haul, so an attractive offer is the name of the game.

The third reason to go with comparing these accounts against each other is that you want to make sure that you really do have a high number of deposits and withdrawals, the maximum allowed under the law.

The fourth reason why you want to go comparison shopping when it comes to these accounts is that the rates are always changing. Getting complacent is also a good way to get sidetracked and end up missing your goals completely.

The final reason to compare easy access savings accounts is because you never know when you will want to connect other types of accounts to the savings account that you have. This is a good way to deepen banking relationships and open the door for new lending opportunities.

Good luck – you can choose the best easy access savings accounts!

Is it Really Wise to Tap into Your Home Equity for Credit Cards?

Credit card debt is something that seems to nag at virtually every household in the country, but does it really have to be that way? If you’re a homeowner with a certain amount of home equity in your home, the answer might actually be no. You see, you can always take out a home equity loan and pay off your credit card debt completely. In fact, some people think this is a better option because you can actually deduct the interest from your home equity loan, something that you cannot do with a traditional consumer credit card. The only exception to this is a business credit card, but then again you wouldn’t be using home equity money to handle that debt anyway.

Yet the question remains: is it really wise to tap into your home equity for credit cards? The answer might be a bit different than you expect.

Again, it really goes back to your overall financial goals. You don’t have to live in fear of the credit card companies, especially if you know that you will be back on the right financial path after paying off your credit card bills. You just need to make sure that you’re actually taking matters into your own hands rather than just thinking that it’s impossible to get out of credit card debt.

This approach also assumes that once you are out of credit card debt that you will not rapidly jump back into charging up all of your credit cards. If you’re going to do that, then you don’t want to go through getting a home equity loan. If you compare credit cards to home equity loans, the stakes are much higher with the latter. You see, if you default on a home equity loan, the lender gets to seize your house as collateral. They can then sell the house and try to recoup the loan in its entirety. This can be difficult for people to understand, but it’s something that has to be understood in order to really see the power of home equity loans.

Some people view home equity liens of credit and loans as something that’s sort of a double edged sword. This is actually a fairly accurate comparison, considering that you will need to make sure that you do your best to ensure that you use your tools wisely. A home equity loan is what you make of it. If you use it wisely, you will be able to rebuild your credit very quickly and get back on the right path. However, if you spend the money frivolously on things that you don’t need, you will only slide deeper into debt on the whole.

Overall, if you’re not sure where to go with your finances, you might want to sit and talk with either a credit counselor or even a traditional financial planner to get a more expert point of view — this is general advice, after all. However, if you know in your heart that you’re ready to make changes in your finances, then a home equity loan could be just what you need in order to pay those credit cards off once and for all!

Tips on Using Payday Loans Responsibly

Payday loans have come under criticism in certain quarters recently for a verity of reasons. The amount of interest which users are thought to pay back is one of the main gripes that some people have, as well as the ease at which payday loans can be gotten from different short term loan companies. There are myths, half truths and pure speculation regarding certain issues with payday loans, all of which will be cleared up within this post; but even with this in mind, it’s still necessary to borrow sensibly.

So how do you use payday loans responsibly?

First of all, understand when you should apply. For example, if you desperately need money to pay for emergency repairs or outstanding bills, then you should definitely consider getting a payday loan. However, if you require the money just to head out with friends, knowing full well that you may not be able to pay this off on your next payday, then you may want to consider staying in and saving your money instead. As a rule of thumb, with whatever circumstance you face, if it’s going to cost you more by not taking out a payday loan, then you definitely need to consider this as an option.

H&T leave payday loan market - photo of coins and notes

Only borrow the money if you know you can pay the money back in full (including any fees and interest) on your next payday. This means that, depending on what you earn, this should dictate the amount you borrow. Lenders will consider this anyway when you apply for a loan, so they will never lend you more than what you can actually pay back anyway, but you do need to think about only borrowing just what you need, and no more.

Early repayment is a good idea if you are using a lender that breaks down your loan interest on a daily basis. However, some lenders will calculate the interest you pay based on your next payday. With this in mind, it may not actually benefit you repaying the loan any earlier. However, it’s always best to check with the lender you choose before applying. Continue reading “Tips on Using Payday Loans Responsibly”

Debt Consolidation Firms

Do you have average or excellent skills at handling your finances? Unless you are a clumsy or careless money manager, you might have an easy enough time balancing out your monthly expenses with the earnings that you are receiving regularly. However, one wrong move could have a domino effect on your finances.

A medical emergency, redundancy at work or any other change in your lifestyle could affect your financial life enormously and suddenly. In the same vein, having one or more credit cards makes it easy to fall into a debt trap wherein you are borrowing more than what you are actually earning. As a result, you will have this mounting debt wherein the minimal payments that you are allotting for each credit card account will not even make a dent on the total that you owe.

Debt Consolidation Firms: The Basics

If you are in a situation wherein you are seriously considering filing for bankruptcy, the good news is that there are several alternatives that you can go for. One of the most common solutions that those who are in debt consider is taking out a loan. The danger of this move is that if you are not that good in handling your finances in the first place, you might end up taking on more debt rather than consolidating them all into one easy-to-pay-for loan. You will almost always pay back much more in the long run by consolidating debt in this way, as the monthly payments are brought down by extending the loan over a much longer period.

Debt Consolidation Firms

The better alternative is to approach one of the more reputable debt consolidation firms online. You will be assigning a debt expert to assess your financial situation and recommend a solution. If debt consolidation is the way to go, then they will be the one to negotiate with your creditors so that a lower monthly payment can be made, interest rates will stop getting charged, and you will have an overall easier time at managing your debts.

Finding Reputable Debt Consolidation Firms

To get you started on learning how to choose the best among the debt consolidation firms out there, here is a list of the things that you need to keep in mind:

  • When looking for debt consolidation firms online, make sure that they have excellent feedback from personal users. Check the online reviews or get personal references from friends or relatives who have taken advantage of such services.
  • Check on the number of years that the debt consolidation firm has been in service. The longer that they have been specializing in offering debt consolidation services, the better.
  • Inquire about perks like free assistance regarding debt repayments, how to create a monthly budget and how not to fall in further debt traps in the future.
  • Naturally, you should make sure that the debt consolidation firm is operating legally and properly licensed, so that you will not be cheated out of the money that you should have otherwise used to pay off your debts.

Continue reading “Debt Consolidation Firms”