Money Makeover

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    Budget Tips

    • Spend less than you earn. There are hundreds of thousands of men and women that spend way more than they earn with the help of car loans, home equity loans and credit cards. The only two options available to help in this situation is a large pay increase or reduction of spending.
    • Save for important things first. It is nice to have a budget, even though we all don’t follow them 100 percent. It gives us a roadmap for our finances. You need to try and save a percentage of your pay each month, equal to approximately 12.5 percent, then pay your monthly expenses. If you can’t do this, then it’s time to cut out unnecessary spending so you get to the place where you can.

    Ways to Save

    • Emergency Fund – put a percentage away in a savings account for a rainy day. You never know when that roof will leak or car repair will hit your pocketbook.
    • Christmas Club – take a few bucks every pay period and stash it where you aren’t allowed to touch it until Christmas (or whatever holiday you celebrate) time. It’s always nice to get that check in October from the bank to spend. Just remember, it’s for other people, not you.
    • Vacation Fund – set aside a separate account just for your vacation for that year. This way, you won’t have to use those high interest credit cards for fun and relation.
    • Purchasing Fund – maybe you want to buy a new car, boat or any kind of expensive play toy. This is a great way to be able to pay cash for it when you are ready to buy!
    • Retirement Fund – let’s not forget to have a savings for those days ahead. If you don’t save for retirement, nobody will save it for you. Whatever you do, don’t lean on the government for that help.

    Credit Card Tips
    Balance Transfers
    Not recommended due to either a higher interest rate or additional fees on the amount transferred.

    Negotiate a Lower Interest Rate
    You can call the credit card company and get them to lower the interest rate while you are trying to pay off the balance. Most of the time they will lower it because they don’t want you to go to another credit card company.

    Keep Yourself at Two Major Credit Cards
    It’s always good to have a spare in case a company won’t accept the one you use the most. I’ve had that happen when out of town and it’s no fun!

    Beware of Retail Credit Cards
    These can be a “snake pit." Be careful when they say, “save an extra 15 percent when you use your retail credit card." That’s fine if you pay it off when you get the statement. Otherwise, they just made money off of you by charging a 21-22 percent interest rate.

    Always Use Your Debit Card as a Credit Card
    It’s best to use your debit card but always say it’s a credit card. That way, you’re not charged a $1.50 fee per every time you use it. Not only does this money come out of your checking or savings account, but also saves you from using any credit cards in the future and paying those high interest rates.

    Be Disciplined

    Try to pay off the balance each month, and only use your credit card if for two reasons:

    • You have the money sitting in the bank instead of your pocketbook to pay it off the next month, or
    • An emergency has occurred over and above your savings. Just make plans to pay it off in short order.