Easy Ways To Improve Your Finance Management Skills

If you are having difficulty with personal finance, or are simply looking for an edge to help you manage your personal finance better, then this article is for you! The advice in this article can teach you to more effectively and consequently more profitably manage your finances regardless of their current state.

When you are putting together a family budget, make sure to get all in the family involved including your children. Since money is spent on each family member, having your family’s input on how much they spend and how much to save, a compromise can then be made on a budget. It is easier to stick with a budget when you have a family consensus.

Knowledge is one of the more essential components to understanding where you are and what must be done to establish your goals. Realize that over time, your expenses are bound to go up and plan. Maintaining this understanding, will reduce stress and put you in a better situation, financially.

Whether you keep track of your personal finances online or on paper, it is extremely important to review your general situation every month. Look for any unexpected changes in your bills, shortfalls in your credits, or irregularities in the dates that money changes hands. Noting these changes and accounting for them is a big part of staying on top of your financial situation.

In order to save money every month, do not sign up for unnecessary leisure services. This will just end up costing you money and more stress. For instance, if you do not watch all of your cable channels, think of getting a smaller package. If you do not use all of your cell phone minutes, think of downgrading to a smaller plan.

Rewards credit cards are a great way to get a little extra something for the stuff you buy anyways. If you use the card to pay for recurring expenses like gas and groceries, then you can rack up points for travel, dining or entertainment. Just make sure to pay this card off at the end of each month.

Write down numbers for contacting service providers such as your credit cards and bank in the event of loss or theft. With these toll-free numbers at hand, reporting and canceling will be much easier. They will also help if you need to find locations to get cash quickly. Store these numbers in your phone as well, but keep a written copy in case of phone issues.

If your employer offers a 401(k) with matching funds, take the maximum deduction from your paycheck. Your company’s matching funds are like an automatic return on your money, on top of the returns from your 401(k) investment choices. Not taking full advantage of the match is like refusing free money.

While personal finance can be stressful at times depending on your financial situation, it should never be difficult. In fact, as proven by this article, it can be very easy as long as you have the knowledge! Once you apply the advice given in this article, you will be one step closer to managing your personal finance more effectively.

The debt snowball method is one of the most effective methods for paying off personal debt, period. Instead of taking a purely logical approach, the debt snowball approach actually makes the whole process of paying off debts much more psychologically easy and satisfying.

Here’s how the debt snowball works.

==> An Overview of the Process

Take out an Excel spreadsheet and list out all your debts. Make sure to include the name of the creditor, the amount you owe, the annual percentage rate, the monthly minimum payment and the payment date for each debt.

Sort your list by the total owed. The smallest debt is the debt you’ll work on first. Unlike other systems which advocate paying off the highest interest debt first, the debt snowball method works by paying off the smallest debt first.

This works because paying off that small debt gives a real sense of achievement. That momentum and enthusiasm can be channeled towards paying off the next largest debt, then the next and so on and so forth.

But that’s not all.

You start by paying off the smallest debt. You do so by paying as much extra towards the debt as you possibly can, while still making the minimum payment on every other debt you owe.

Let’s say the minimum payment for your smallest debt is $100 a month. You decide you can put an extra $200 a month towards that debt as well to get it paid down as quickly as possible.

Once the debt is paid off, however, you now have that $200 a month plus the $100 a month minimum payment that you can now put towards your second smallest debt. Let’s say that debt’s minimum payment was $150.

Once that’s paid off, you now have that $150, plus the $300 from earlier that you can now put towards your third largest debt.

In this manner, the payoff process effectively “snowballs” until you have an incredible amount of momentum and financial power that goes towards paying off your debts.

==> A Few Things to Note

There are a couple things to keep in mind with the debt snowball method.

First of all, some lenders will try to apply any extra amount you pay to your next month’s payment instead of applying it towards your principal. Make sure you talk to your lenders to make sure your extra payments are paying off the principal. And you also make use of services like a Government IVA which can help you clear debts over a 5 year period.

Second, the debt snowball method is much more of a psychological approach than mathematical. However, debt repayment is often much more about keeping your spirits up than strict math. Try the system for a few months to make sure that it’s really, truly working for you. If it is, then commit to sticking it through until completion.

Finally, and this might go without saying, as soon as you start this process you absolutely must put away all your credit cards. There is no sense in starting this process if you’re going to rack up debt along the way.

Payday loans or cash advance loans are personal unsecured loans, which means you don’t have to put down any collateral for the loan. You do however have to pay significant interest rates and fees. They can be good for someone who is an immediate cash crunch, if you’re willing to pay the price. For example, you have a car or home payment which is due tomorrow and you don’t have all of the cash you need to make the payment. Rather than risk a late payment, expensive fees, and a bad mark on your credit report, you decide it is worth the extra fees to get a payday loan.
Payday lenders are able to charge such high rates because the loans are unsecured and they take very little information from you. Meaning, for the lender they are incurring a bit of risk, which you’re paying for. All you really need to get a loan is a job, an address and a checking account that is in good standing. Another benefit for consumers is that they money is available almost instantly with cash in hand times ranging from one hour to 24 hours.

One of the nice features about cash advance loans for consumers is that they are easily accessible and you can likely find a cash advance store in your hometown or online – whichever is more convenient for you. The average loan pays out generally no more than $1000-$1500 and the loan term generally lasts less than 14 days. The fees generally range from $20-$40 per hundred dollars. That means if you borrow $1000, you owe them $200-$400 in fees. Pretty steep, though some do charge a flat fee of around $30 or $40. If you extend or “roll-over” your loan, you will pay hefty fees for each extension.

If you’re in a bind and need cash fast, the process is simple. In store you would write a personal check payable to the lender for the amount you need to borrow plus a fee. So if you’re borrowing $300 and the fee is $40 per every $100 borrowed, you’d write a check for $420. The lender will give you the amount of the check minus the fee. They’ll give you $300. If you borrow online, the process is similar in that you give them your routing number and account number and they deposit your loan into your account.

Payday or cash advance loans are an alternative for people in a cash crunch, however great care must be taken to make sure borrowing doesn’t turn in to a cycle of debt. When the loan comes due, not being able to make a payment will result in extremely costly fees. Be careful and weigh all options before you make a decision to obtain a payday loan

The Total Money Makeover: A Proven Plan for Financial Fitness Book Review

Financial freedom is something all of us want to achieve. But how can we experience it if we do not know how to handle our money? There are several financial planning strategies out there but not all of them are effective. As a matter of fact, most so-called financial strategies are just mere list of the things we already know but cannot take into action.

What we need, in order to gain financial success, is something that will motivate us do better; something that we will follow. There are several books about generating personal financial freedom, but only a number of them give an effective outcome. One of the most influential financial books is Dave Ramsey’s The Total Money Makeover: A Proven Plan for Financial Fitness.

About The Author

Dave Ramsey is a financial author, TV personality and radio host. He is the voice behind the syndicated radio program The Dave Ramsey Show, which is heard on more than 450 radio stations all over the US and Canada. He also had a TV show of the same title which aired on ET and Fox Business Network.

Ramsey has written a number of financial books including Financial Peace Revisited, More than Enough: The Ten Keys to Changing Your Financial Destiny and The Financial Peace Planner: A step-by step guide to restoring your family’s financial health. Furthermore, Ramsey is also the author of kids’ books The Junior Discovers Series.

Dave Ramsey is also associated with several businesses including The Lampo Group, Inc., which helps people who are struggling with their financial issues. Ramsey takes pride that this business has successfully run for years completely debt-free. He also runs theFinancialPeaceUniversity, a service selling a 13-week financial training video series for adults. This video was later succeeded with a financial training program especially engineered for teenagers.

About The Book

The Total Money Makeover: A Proven Plan for Financial Fitness is a 288-page book concentrating in managing personal finance. The book tackles Ramsey’s basic plan to gain financial success. If you look inside the book, you’ll find real life situations inside its pages. The stories are titled in such a manner that will hit you right in where it should be. With titles such as ‘I Did It My Way, And My Way Wasn’t Working’, you would think it was made for you.

In The Total Money Makeover: A Proven Plan for Financial Fitness, Ramsey talks about the ‘Gazelle Intensity’. He advises the readers to just live a financial life the way a gazelle saves itself from a predator: To outmaneuver the enemy and run for your life.

The best thing about this book is that it speaks the truth. The truth is that it takes hard work to be free of debt. Unlike other books that cheat you into imagining that you are going to get rich in a matter of minutes, The Total Money Makeover: A Proven Plan for Financial Fitness true strength is that it is a frank and uncomplicated motivational tool.

Review

Dave Ramsey has experienced bankruptcy himself so he is REALLY familiar with financial struggles and knows what he is talking about. Ramsey came to the conclusion that the key to a successful financial plan is to be honest with yourself.

In The Total Money Makeover: A Proven Plan for Financial Fitness, Dave Ramsey talks about his simple and straightforward principles: Pay cash, pay off your debts e.g. debt consolidation, credit card or personal loans, and create an emergency fund. The book provides idiot-proof answers to what we thought were difficult questions about money

Unlike his book Financial Peace, Dave Ramsey’s The Total Money Makeover is a how-to-do type of book. The book will walk you through the seven ‘baby steps’ to financial approach and will show you exactly what’s to be done.

Ramsey’s short but factual advices like: “A new $28,000 car will lose about $17,000 of value in the first four years you own it. To get the same result, you could toss a $100 bill out the window once a week during your commute.” and “If your mortgage payment is $900 and the interest portion is $830, you will pay that year around $10,000 in interest. What a great tax deduction! Right? Otherwise, you’d pay $3,000 in taxes on that $10,000. But who in their right mind would choose to trade $10,000 for $3,000?”, will surely wake you up and convince you that it is about time you do something with your financial matters.

This is not a ‘get rich quick’ book from an inexperienced guy claiming he is gonna help you with your current financial struggles. This is a practical and highly-motivational book that will guide you through the steps in building true wealth. It has loads of true stories from people who have succeeded in following Ramsey’s financial plan.

The Total Money Makeover: A Proven Plan for Financial Fitness does well in presenting inspirational stories of people who WERE once financially struggling.  This must-read book and it is available on Amazon.com for only $14.99 and it is eligible for free shipping.

2 Easy Steps to Take Control of YOUR Money

In today’s economy it is very important that you control your money. There is a simple system to do this
in just two easy steps:

A. Track your income

B. Track your expenses
This is not difficult to do. Here are the steps:

1. Buy a notebook that has pockets in the front cover;

2. Each day have everyone put their receipts in the front pocket. If the receipt doesn’t say what the purchase was for, write it on the back;

3. On the first page of the notebook, list ALL of your income;

4. On the next page, list all of your FIXED EXPENSES, such as mortgage/rent, car payment, health insurance, car insurance, homeowner’s insurance. For any expense you have that is paid quarterly or semi-annually, just divide the total yearly expense by 12 and enter that amount;

5. On the next few pages, list your VARIABLE EXPENSES by category, such as groceries, clothes, household expenses, eating out, school lunches, bus fare, etc. Allow about half a page for each expense;

6. Sales tax can be entered as an expense. There’s no need to split it up between the different categories on a receipt;

7. every couple of days sit down with the receipts and enter the amounts on the various pages under the correct category. If, for example, one receipt is for several different types of categories, write on the back of the receipt how much was for each category and enter it on the correct page;

8. If you have cash expenses for which there is no receipt, such as the neighbor boy cutting your grass, just remember to enter it in the notebook when you pay him. If your kids want a couple of bucks to go buy a Coke at the corner market, write that down, too.

You don’t have to list each item separately. You can sub-total all of the grocery expenses for the receipts you are entering and put them on the appropriate page.

At the end of the month, make a chart with two columns. In the first column put the following headings: Income, Fixed Expenses, Variable Expenses, etc. Under each Heading list the categories that fit that heading.

In the second column, called Amount Spent, list all the totals from each Category page. At the bottom of the chart, subtract the total Fixed/Variable Expenses from the total Income. This will give you the information you need to take control of your money.

Debt consolidation works to save your funds and time, while reducing your total paperwork load at the same time. Not only will you save money when you begin the debt consolidation process, but you will also save money on gas if you find a source online and can avoid dozens of trips to your consolidator’s office.

Some debt consolidation programs offer resources with “no lending fees” and “guaranteed” low costs. Most debt consolidation online sources provide debtors relief by handling their cases “one-on-one.” Some debt consolidation agencies online even claim to get your debts reduced in a matter of minutes. All you need to do is fill out an application online. You may want to note that having all your bills together while filling out the application can also save you hassle.

Property Owners

Property owners are also offered debt consolidation resources online. Some companies will work to find you a loan that will reduce your monthly mortgages and interest rates. Few debt consolidation lenders will even help you get a loan up to 125% of your property value.

Non-Property Owners

Debt consolidation sources online can offer people who do not own their home a loan to help them consolidate their bills. Keep in mind that the loan is not directly handed to you in most instances; rather, the loan is applied to your debts. In addition, if you are a student, there are sources online that will help you reduce your student loans, or else get you the cash to payoff the debt. Many of the online debt consolidation sources have online tools to help you review the savings of consolidating your debts. Again, having your bills together when you go online will save you time and energy.

Finally, you may want to consolidate your bills by asking for help from a trustworthy source that will not charge you costly fees or rates of interest.

We all could use some help when it comes to saving money. That odd trip to the store for a sweater that results in a new wardrobe, or a trip to buy a new phone and we walk out with a phone, an answering machine, and a digital camera. These things happen, but adopting some frugal spending tips can make saving instead of impulse spending the norm.

Don’t shop on payday. This is when you have the most money. You haven’t paid the bills or put money away for savings. In error, we believe that we have more money at our discretion than we really have. At the end of the shopping trip, we are a few hundred dollars in the hole and a bill goes without being paid.

Don’t shop for groceries on an empty stomach. This is a universal rule. It never fails; if you shop when you are hungry you can be talked into buying anything. The shopping list goes out the window and so does the grocery budget for the month. Shopping when hungry could also cause you to stop for fast food on the way home because you can’t wait to fix something to eat.

Visit thrift stores and consignment shops. This works for kids when they are babies and toddlers. These stores have beautiful clothing that is in excellent condition. All it takes is a little searching to find a treasure or two at a fraction of the cost. Name brand clothing can be found here also. Thrift stores are a good alternative to “hand-me-down” clothing for younger kids.

Buy in bulk only if it is something that you need. Buying everything in bulk is not necessary. Some bulk prices have a higher unit price than buying a couple of boxes of cereal or baby formula. Carrying a calculator to the store with you can aid in figuring up which is the best buy. Join a shopping warehouse if you frequently buy bulk items.

Ask for a rain check. Some stores don’t give them for certain sale items, but it doesn’t hurt to ask. A rain check can save you money. Don’t buy a six dollar case of water if you can get it for two dollars with a rain check. Buy up to the limit you are allowed to purchase and stock up.

Bargain shop when looking for services. There’s no rule that says you have to go with the first plumber that you call. All companies don’t charge the same amount. Checking two or three places will give you a good idea of how the prices stack up. Choose the one with the most services for the lowest price. If you are not sure, ask a friend who may have had the same need that you do now.

Purchase gifts throughout the year. Don’t wait until right before the holidays or someone’s birthday. Finding gifts throughout the year saves money. Sales after Christmas are the perfect time to find all sorts of merchandise that would make good gifts for the following Christmas. Store your gifts in a cabinet for that purpose so that you are never without something to choose from for gift giving.

A few frugal spending tips can save a lot of money. It takes a conscious effort to start, but once you get the hang of it, it will become second nature.

Many people choose to take out loans to help them finance different things and to achieve their goals. It is hard for a lot of us to afford our kids’ college education as it is really expensive. This is why a lot of students can apply for student loans which are fairly easy to obtain. But since a lot of students apply for these loans, one should apply as early as possible and even before the admission to a college is confirmed. Usually the month of April is the perfect for time to apply as after this there are a lot of applications that are sent for approval and the government only have a limited number of loans to give out.

Apart from student loans, there are a lot of other types of quick loans as well. Like college education, it is hard for the average Joe to buy a house by paying the full amount and the same goes for a car. So it is possible to take out home loans, mortgages and car loans which are payable over a long period of time. And some repayment periods can last from 15 years to 30 years and the installments are monthly. However when trying to get loans approved for larger amounts, you must have a very good credit history and a high credit score otherwise your loan application could be rejected.

Some people have a tight budget and they cannot spare a few extra dollars for special occasions like Christmas. These are times when everyone wants to buy their kids things they want and they sometimes overspend and when the time comes to pay off those credit bills, they get short of money. For such occasional expenditures, you can get quick loans and pay day loans. These loans are of smaller amount and not more than $1,500. But the good thing about these loans is that they are approved within a couple of hours and you get cash in your account on the same day.

For people who usually have problem in paying off their bills, they sometimes need debt help and have to apply for debt consolidation loans. These are given by debt consolidation companies and the amount can be whatever the client needs. But the drawback is that there is a very high interest rate on such loans so they should be applied for only when there is no other option left.