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Getting Your Personal Finances in Order

It’s that time of year again: the time when we take a hard look at our spending and saving and make a new plan to do better once the calendar flips over to January. Even the most organized and financially savvy among us do this. Here are the most common financial issues people identify and what you can do to fix them.

Living on credit isn’t anybody’s idea of a good time. For most of us, it is the last resort while we try to keep ourselves financially afloat. If you’ve been living on credit there are a few options available to you.

 

Consolidate Your Debt

For most, the hardest part of living on credit is the destructive cycle it perpetuates. The more credit you use, the more interest you are charged and the harder it is to pay off those bills. Consolidating your debt into a single payment saves you buckets of interest fees and makes managing your debt easier and more affordable. The simplest way to consolidate your debt is to use a debt consolidation loan. If your bank isn’t an option, you might want to consider one of the quick installment loans available to you from a lender like Blue Trust Loans.

Another option if your credit is truly shot is to work with a non-profit organization to consolidate and pay off your debt. These programs are a fantastic way to reduce what you pay each month while also allowing you to avoid bankruptcy.

Spending More Than You Earn

This is how most of us end up living on credit in the first place. We’re used to living a certain type of lifestyle but with the cost of living dramatically outpacing wage increases, this gets more difficult all the time. If you are regularly spending more than you earn and having to rely on credit cards to get you through, there are two main routes to correct this behavior.

Spend Less

There are so many ways to reduce your spending without having to reduce your quality of life. For example, thanks to streaming services and the web make programming available at low costs (or even for free). This makes cutting the cable TV cord is almost painless! Second-run theaters allow you to see blockbusters on the big screen for way less than you’d spend at a first run theater. The library offers the same books you normally buy and then only read once–many of them also have extensive catalogs of eBooks available for you Kindle lovers out there. And, of course, there are a plethora of ways you can reduce your grocery costs, your utility bills, transportation, etc.

Earn More

Talk to your boss about possibly raising your salary or picking up some more hours or some overtime. If those options aren’t available, don’t panic. There are other methods available for bringing in more cash.

Sell some stuff or downsize. You would be amazed at how much money you can rake in at a yard sale or by selling your stuff online. You should be able to make a pretty good sized dent in your debt with your profits–especially if, say, you sell your car and start biking or taking the bus.

Get a second job. This might be tricky since most part-time second jobs tend to lay people off after the holidays. Still, it’s worth taking a look around to see if there aren’t some weekend or evening shifts available at your local coffee shop, grocery store, mall, etc.

Take advantage of the gig economy. There are all sorts of ways to get involved with the “gig economy.” If you still have your car, consider driving for Uber or Lyft. Use apps like Taskrabbit to find odd jobs to complete in your neighborhood. Try some mystery shopping. Or look for online side gigs like taking on some freelance writing, bookkeeping, or design jobs. If you work diligently the gig economy can be quite profitable!

Ask For Help

Nobody likes having to panhandle among their friends and family for money but sometimes, if the situation is dire, that’s what you need to do. There are a lot of socially based crowdfunding sites out there, like GoFundMe, YouCaring, etc. The nice thing about these platforms is that you can “earn” your money by offering rewards in exchange for contributions. These rewards can be anything from your own art to cleaning to helping with projects, etc.

Another option, though there is some social stigma attached to this (unfortunately), is to pay a visit to your local DHS office. Depending on your income and family status, you might be able to qualify for SNAP benefits, WIC, TANF, and other help.

Remember to be objective as you evaluate your situation. The more objective you can be, the better able you will be to take the steps you need to take. Good luck!


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Why Good Personal Finance Management and Prepping Go Hand in Hand

Are you a prepper?  Or are you more of the camp that prepping is for the wackos and the conspiracy theorists?  Or maybe you’re somewhere in the middle.  We like to consider ourselves thoughtful observers, although we’re more on the side of the preppers than the non-preppers. 

Whatever your thoughts on the whole issue, the facts are that preppers are making money for America.  Numbers on guns, ammo and survival products are up as much as 40% in the last 5-8 years.

SO, what does this have to do with you as a lover of all things frugal?

Actually, quite a bit.  You see, much of what preppers are preparing for has to do with unexpected natural disasters, such as Hurricane Sandy.  Last July, for instance, a plethora of thunderstorms, tornadoes and unbearable heat pounded the East Coast and some Midwestern states.  Remember?  Although there were lots of terrible tragedies and horrible things resulting from the power outages that followed the storms, what also stuck out to me was that those who weren’t prepared spent a TON of money simply to feed and shelter their families, when, if they’d done some basic preparation, they could’ve saved LOTS of money.  Here are some news excerpts:

 

“Today makes seven days without power since last Friday, and we don’t have water either,” said Tammy Pickles, a 40-year-old convenience store manager waiting in line with a dozen other people under a hot midday sun for a meal.

“Money is really tight,” said Pickles, who has a 12-year-old daughter at home. “I’m not sure how many more trips I can make out here to get a hot meal. I’m not sure I can afford the gas.” 

A Safeway supermarket tried to remain open with a limited power supply and handed out free bags of dry ice. But the air inside was stale. Shopping carts with spoiled food, buzzing with flies, sat outside the store.

In this heat, ice has become the most valuable commodity. Pinehurst Wine Shop in Maryland is buying extra ice just to give it away at the end of the night.

That ice may salvage a few more perishables. Families have lost food and have to spend money on eating out.

“We can’t afford to go out every single meal, so we’ve been bringing some stuff home, using the grill, used up everything we could possibly use up in the first 48 hours,” one woman without power said. CBN.news

She said she had lost $400 to $500 worth of food from her freezer and refrigerator when the power went out

The stop lights were out, the streets were blocked off, gas stations across this area were lined up all the way in one block. Fast food restaurants were packed including the drive thru. Surviving a Derecho Wind Storm    (Can you hear their money flying out of their pockets??)

The lack of power completely upended many daily routines… People on perishable medication called pharmacies to see how long their medicine would keep. 

Baltimore County, Eveena Felder, a registered nurse, had been relying on air-conditioned public areas to keep cool during the day and a fan to help her family sleep.

We’ve purchased a ton of batteries, that’s where most of our money has gone,” Felder said. “Turn the fan on and keep still, don’t move, less energy.” 

Brooks will likely fork over more cash for a hotel room rather than sit and bake inside his Woodlawn home.  “It’s rough. It’s wiping out my account,” he said. CBS News

 
“…people out there are stealing cables, for the copper or aluminum and trying to get whatever they can for them. People don’t have a lot of money in some areas, and it is disrupting the work to get everyone back to power.” Nj.com
 
Power was out for 100 hours. The landline telephones were down for 3 days, 911 was down for two, and the water restrictions lasted upwards of a week. Some counties are asking its’ residents to boil their water before drinking it
 
 
Most of us on the frugal path have worked, or are working, very hard to rid ourselves of debt and provide an ample nest egg in order that we may live comfortable lives.  How frustrating would it be if thousands of those dollars were wiped out in one fell swoop because we had to spend them on hotel rooms and meals at restaurants?
 
 
Prepping to Save Your Family AND Your Finances
 
SO, what can those of us do in the way of prepping enough to protect our nest eggs?  Here are some easy-to-accomplish frugal tips that will help provide your family in most any situation:
 
1.  Have water on hand.  A gallon a day per person in your family is the recommended.  This does not include washing, but basic cooking and drinking needs.  Try and have, at minimum, 3 days worth.  More if you’re a nursing mom or feeding your babies with formula.
 
2.  Have a good two weeks worth of non-perishable foods that don’t need cooking on hand at all times.  Pick stuff you like and will want to eat, or don’t.  Just pick stuff that you can eat right out of the can or bag.
 
3.  Have a plan.  We all make plans for our finances, or if a fire breaks out, etc., but rarely do we remember to have a plan in case the sh _ t hits the fan, weather or otherwise.  A plan is crucial to your money surviving an unexpected disaster.  Do you have somewhere to go – a cabin, or a friend or relative’s house?  Will you find a hotel?  Put the money aside for it, in advance, in cash, not at the bank.  A power outage can render banks and ATM machines largely unavailable.
 
If it’s possible to stay home and you want to stay home, research the many types of generators and pick one that will work for your family.  Often too, you can find them on Craigslist and at garage sales instead of buying new, saving even more money.
 
4.  Never let your gas tank get below half.  If you’re in a danger situation, you don’t want to have to go to the gas station and wait in line with the other unprepared people for an hour or more.  Always have at least half a tank of gas in your car so that if you need to go, you can simply get in your car and go.
 
5.  Remember the others.  Keep in mind that if you decide to become prepared, any neighbor or family member who knows you are prepared will be knocking at your door, looking for help and food to eat.  Be prepared to help them, or to defend yourself against them.  Not trying to sound wacko here, but if it came down to feeding or not feeding my kids, I’d steal from you. (Ok, I’m kidding.  Well, half-kidding).
 
Regardless of your views on prepping, there is some sense to it when it’s done in a way that protects your family and your money.  With the increase in natural disasters in the last few years, we’d all do ourselves and our money a world of good to do a little prepping work before that big storm hits.


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Easy Tips for Teaching Your Children Personal Finance

Me: [On a fresh summer day] Good morning, Mum.


Mum: Consider a ship sailing gently in the vast blue ocean. If all the water were to dry up, the ship would stop sailing. If there were a flood or rough storm, the ship might get damaged and sink. In life, you’re the ship and money is the water.


Me: Can you please make me pancakes for breakfast?


Mum: This is the relationship between money and happiness, dear. You need a certain amount of money to be happy, but greed will lead to thoughtless consumerism and lack of appreciation for what you have, and they are your enemies.


Me: How about you drizzle some honey over them? Thanks.

This story is partially true – not because my mum didn’t share this analogy with me, but because I dislike honey – a lot.  She heard this bit of wisdom on the not-so-idiotic box.
My mum and dad not only told me how to spend and save wisely, but also showed me. As role models, parents can do plenty to set their children on the path to financial independence and spiritual well-being. In most cases, children will follow that path, because they are born mimics, and as they grow up, their first frame of references are their parents.
Here are some tried and tested ideas you can add to your family’s culture to improve financial discipline of the entire household.
1. Record and Compare.  Each member of the family should record all incomes and expenses, dividing them up in terms of groceries, entertainment, gardening material, food, stationary, gifts, etc. With the intent of empowering each grown-up and kid to control spending habits, sit together to compare notes and trends over the last few months.
Encourage thrift and gently advise against wasteful spending on entertainment and often-expensive-and-always unhealthy junk food.
Avoid saying: ‘You wasted all your money watching movies, dear. I’ll have to disown you after cutting your allowance.’
Instead, consider saying: ‘It seems we spent a lot at the cinema last month. Let’s give it a break for a while and see some movies at home instead.’
2. Saving And Giving To Charity.  Set targets for saving and donating small portions of household income and pocket money. Even if you can afford to buy expensive gadgets, toys and furniture right away, consider saving up for them because delayed gratification can help improve self-restraint.

Share with your children any information about donations made to NGOs, free health clinics, or shelters for the homeless, and keep pointing out the merits of giving to charity.

Avoid saying: ‘We don’t have enough money to buy you designer sneakers, dear. Do shut up.’

Consider saying: ‘We sure are lucky to be in a position of ‘giving’ charity instead of ‘accepting’ charity.’

Or say”  ‘You’re shoes are a little worn out but there’s nothing wrong with them otherwise. We’ll get a new pair after a few months, and donate yours to the homeless shelter because someone could probably use them for another year or two’.

3. Don’t Shop Till You Drop.  Impulsive buyers often shop without a list and end up over-spending. Make monthly shopping lists for ‘mum & dad’ and ‘kids’ (include groceries, junk food, candy, drinks, fashion accessories, room decorations, etc.) and take your children to the store to give them an idea of how the household is budgeted.

With the sole intent of window shopping, visit toy stores with your children and let them browse the collection to their hearts content. Any requests for purchases should be met with gentle yet firm reminders about the purpose of the visit.

Avoid saying: ‘Will your wish list ever end? I can’t afford to keep you in my house anymore. Good bye!’

Consider saying: ‘We’re just here to have a look around. You have plenty of toys waiting to play with you at home.’

4. Spiritual Guidance.  Use references from your religion to teach your family about thrift and wasteful extravagance. All belief systems praise humility, hard work and gratitude for one’s assets, regardless of their shortage or abundance – correct me if I’m wrong – because these qualities are related to spiritual success. And as artless as it sounds, our life’s aim is to be happy.

5. Penny-Wise and Not Pound-Foolish Either.  We all compare prices for products and services we buy – it’s natural to want to get a good discount. But we often forget to encourage our children to do the same. While at the mall, give your children a budget and allow them to buy anything, as long as it fits within the range.

Avoid saying: ‘Why do you always pick the priciest item? Even you’re not worth that much!’

Consider saying: ‘I think this teddy bear cost a few dollars less at that other store. You could use that money for something else or give it to the homeless man we saw earlier; he’ll be really happy.’

Or say: ‘I’m sorry dear, you’ll have to put back one item because you’re spending more than what you have. Maybe buy it next time.’

And make sure you follow the same principle when shopping for personal items. Communicate with your children about your buying decisions and sacrifices.

If you didn’t buy something you liked, tell them, ‘That green bracelet sure was pretty but I’ll wait a few months for the price to come down. It’s just not sensible to spend that much on a bracelet.’

It’s easy to see that empathetic communication must accompany leading by example. Eventually, you will direct your children away from ungracious indulgence and towards prudent buying behavior, and while that won’t guarantee your kids a great life, it will go a long way to achieve that end.

Fehmeen blogs at Management Mafia, where she writes articles about different management topics with a touch of humor. You could follow her on Twitter, but you don’t really have to because all her work on business and home management is on her site!


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