Are These Money “Truths” Stealing Cash From Your Pocket?
From when we are young we start learning various “truths” about money and how it works that become ingrained in our life. Often we learn these habits from our family or friends, although they can also be details we learn at school or by watching TV. Unfortunately a lot of these “truths” actually wrong. In this article we look at 5 of these truths, and show how these truths are costing you money!
“Truth”: Creating a budget is hard, and means you have to do without.
Reality: Creating a budget doesn’t have to be hard – there are many different types of budget, and a bit of looking will find one that’s perfect for you. And once you have a budget in place, you have the best tool available to take control of your money and get it focused on delivering everything you want in your life. A budget isn’t some evil process that deprives you of the things you want – a budget is a system for helping you get the money you need for the things you want!
“Truth”: The bank you have always been with is the best bank.
Reality: Your parents may have always kept their money at a particular bank, and when you got old enough you opened all your accounts there too – savings account, credit card, home loan, etc. However it’s a fair bet that if you looked around you could find a bank (or other financial institution) that offers much better terms, whether it’s a better interest rate on your loan, no account keeping fees, or whatever. These little extra savings can add up over the years!
“Truth”: If you buy something on special, you are saving money.
Reality: This truth really falls under a “half-truth” label. If it is something you were going to buy anyway, then it is true that you are saving money by buying it on special. But if the only reason buy the item is because it was on special (ie: you weren’t planning to buy it originally), then you haven’t saved any money at all – you’ve just spent money. Shops use this trick all the time – they know that people will just see the “sale” sign and spend more than they normally would because they feel they are getting a bargain.
“Truth”: You are stuck with whatever interest rate the credit card company gives you.
Reality: Credit card companies really want you to believe this “truth”! While it doesn’t always work, if you contact your credit card company and tell them you are looking at changing to another company because they have better rates, most companies will offer to lower the interest rate on your credit card. Because of the increased competition in the market place these days, credit card companies know that you have many more options than you used to have for getting a credit card, so they are willing to work to keep you as a customer.
“Truth”: If you refinance your house at a lower rate, you are saving money.
Reality: Unless your new loan is for the same length of time as the time you have left on your current loan, you may be paying less each month but end up paying more in the end. So if you have already paid off 4 years on your original 25 year loan, your new loan should be for only 21 years. In the early years of the loan, most of each payment goes to simply paying the interest on the loan – if you get another 25 year loan you won’t be reducing the amount you owe, and will end up paying a lot more overall.
When it comes to money matters, sometimes it is best to sit down and relax with a nice cup of coffee made by drip coffee maker. Homemade ice cream from a Lello 4070 Gelato Junior wouldn’t go astray either!
Ways To Budget For Your Children
Budgeting is the real secret to financial independence. Funds for almost anything can be readily available if you set aside money every time you earn it. However, when it comes to budgeting for your children the need for it immediately inflates. In order for your child to have the best possible future it is very important to start budgeting.
Open a fixed bank account. Fixed bank accounts are guaranteed to give you the much needed financial security that makes for a well raised child. When your children have needs that have to be satisfied urgently a fixed savings account is going to come in very handy. Fixed accounts limit withdrawals to certain times that you set yourself.
But sometimes this fixed account will not always be flexible enough to come to your rescue when you need the funds immediately. To cure this you can start a trust fund instead. But the trust fund must at least have a condition that applies to clear emergencies. Therefore if an emergency arises before the maturation of the trust fund you will still be able to access the money.
Find out from family friends how best to budget for your child. With advice from the experienced you are immediately put in the know regarding baby cribs, toys and schools that you might have to invest in somewhere along the way. Doing this sheds light on the needs you must save up for just in case you have no idea.
You do not want to be putting money aside and later realizing that it was not enough. Do your research to know how much you ought to save. Saving without the slightest idea can lead to the unfortunate scenario of insufficient funds at a time of great need.
Opening a life insurance policy protects your family from the unexpected. Death is just but a heartbeat away and tomorrow you could be dead. So to make sure your children can still get the sleigh beds they need you ought to have a life insurance policy.
So do the smart thing and save up for a life insurance policy. At least your widow or widower will not have to struggle with buying a sleigh bed when the time comes. An insurance policy will definitely make life easier.
Categories: Uncategorized Tags: baby cribs, budgeting, sleigh bed
The Best Family Budget Tips
Discover the best family budget tips to help you relief the stress. In order to have piece and happiness in your family you need to know that you can pay the bills in time. Many families are having this problem. Learn how to manage your money by following a few easy steps. There is no need to have millions of dollars in order to have a happy family.
When you are pregnant you need to save money for your baby. This is why spending money for maternity wear can be a waste. You can ask one of your friends to borrow you some. The good news is that you will only need them for a few months.
In winter time your house bills will be a lot more expensive. A very useful tip is to have a portable space heater. You can move it from room to room. This way the room where you spend your time will be always warm and comfortable. This will help you lower the bills during the winter.
When you shop for clothes you should search for quality and not for the brand. You can find good things for a very small price. For example if you wish to buy jean skinny you should search until you find a good price. Go to smaller shops. You have more chances to find cheap clothes there than in a big mall.
For some products it’s worth paying more money. Do this for the things you are planning to use for a long time. This way you don’t have to replace them very often. As an example it’s always better to buy high quality shoes even if you might pay more. This is a good solution to save money.
Try to do your groceries just once a week. Pick a day from the week and make a shopping list. Usually people prefer to shop at the end of the week. When you make the list ask advice from your kids and husband too. Purchase only what is on the list. It will be easier to control your expenses.
If you shop once a week for groceries make sure you stick to the list. You can be tempted to buy other things too. Eating at home can also save you a lot of money. This way you will always eat healthy and good food. Cooking for your family can be fun if everybody helps.
Categories: Uncategorized Tags: budgeting, save money
Get Out Of Debt With The Envelope Method
If you are trying to eliminate all of your debt, there are several methods available that can be very effective. A critical part of whatever method you choose is setting up an effective budget. A popular budget method that has been around for a while is called the envelope method.
To begin, write down a list of all of your typical expenses. These are the expenses for which you normally use a debit card or credit card. On your list, break it down into different categories such as groceries, entertainment, gas for your vehicle, and personal grooming for things like hair or nails. Then you will need to take out an envelope for each category and label them accordingly.
Next, decide how much money you are likely to spend in each category on a weekly, bi-weekly, or monthly basis. A good rule of thumb is to just use the figures based on two weeks as a majority of people are paid every other week. Put the amount of cash that you totaled up for each category in its labeled envelope.
If you spend all of the money for a specific category prior to getting your next pay check, then that’s all you can spend. You will just need to make do until you get your next check. This really forces you acknowledge the amount of money you’re spending, unlike what happens when you use your debit card or credit cards. Another benefit is that you are unable to take money from one of your other categories once you have exhausted your money like you can by purchasing items with a debit card or your credit cards.
This tactic will make you realize that you’re spending more money than you have budgeted. Then you will be faced with a decision to either increase the amount of your budget, or learn to change your lifestyle to live within your means until you no longer have any debts.
Now you should understand why the envelope budgeting system is so popular. It’s easy and it gets the job done. Give it a try and kiss your debt goodbye forever.
William has been writing about various financial topics for almost 5 years. If you need to fix credit problems or you need credit repair help help, be sure to visit William’s latest website where you will discover how you can systematically fix credit score problems.
Categories: Uncategorized Tags: budgeting, create a budget, debt elimination, debt help, eliminate debt, envelope method, start a budget