Living Above Your Means & What That Can Mean For Your Finances
March 5, 2012
We’ve all heard the phrase “keeping up with the Joneses” before. This means that you always buy things that are probably not within your budget and that you most likely can’t afford, but you need to keep up appearances anyway. You have people to impress and a reputation in the neighborhood to protect. You are always comparing yourself to your neighbors as a benchmark for social caste. This is not a good thing for your family, your personal finances or that monthly budget.
It’s sometimes hard to distinguish between a want vs. a need. Especially if it’s something you really want and have wanted for some time now. You’ll make excuses about why you “need” that certain item. Before you know it, that item is in your shopping cart and you buy it. This kind of mentality needs to stop. It is going to destroy your budget and eventually may lead to serious financial problems.
Ways to Decrease Expenses:
- Go to a matinee instead of an evening movie. Rent movies from Netflix or Red Box instead of from your cable company. Better yet, get free movies from your local library.
- Ask your utility company to perform an energy audit of your home to show you how to save energy consumption and thus save more money each month.
- Comparison shop for insurance and ask about available discounts. Whether its car insurance, health insurance or homeowner’s insurance. If you bundle everything together with the same company, you could save hundreds of dollars every year.
- Avoid convenience food stores and convenience food (fast food). Everything is always more expensive there and fast food is just not healthy for you. Cook more food at home and bring leftovers for lunch.
- Stay away from the vending machines at work. You can bring in snacks and beverages from home to save money.
- Ask your doctor about generic equivalents for your prescription drugs. Many times you’ll end up paying 2-3 times less than what you’d spend on the brand names.
- Check out consignment shops or online discount stores such as eBay.com or OverStock.com; especially for children’s clothes because they grow out of them so quickly.
- Go to 1 or 2 stores at the most to get all of your errands done. There’s a reason why people love Wal-mart so much. It’s not just because of the everyday low prices, it’s because you can get everything you need in just that 1 store. You’ll save so much money on gas by keeping your driving limited.
There are many other ways to decrease your spending habits. Stop and think before you make that next big purchase. Ask yourself if it’s truly something you need and how it will benefit you and your family. If you know you can live without it; then don’t buy it. Impulse spending is one of the major reasons people fall into serious debt.
If you need help getting out of debt, call Advantage CCS today and ask us how we can help. Our certified credit counselors will review your situation and see how much of a “shortfall” you may have. They might recommend a debt management program to help you get back on track. Let us help get that debt monkey off your back today!
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Leap Into A Strong Financial Future On Leap Day
February 29, 2012
Leap Day comes around once every 4 years. This is a free day! You are saving money today and you may not even realize it. February 29th means a free day of car insurance, homeowners insurance, cable, and rent – basically any services with monthly rates that do not increase as a result of this bonus day. If you are an hourly paid worker, that means another work day in February to earn more money. On the downside, salaried workers earn a tiny fraction less per day.
Take this bonus day and plan for your financial future. Leap into your finances and try to make some cut-backs to save more money in the upcoming months. Many people look at this bonus day as an opportunity to do something different or start fresh. This can be said for your personal financial outlook as well. Leap Day is also a good excuse to change your spending habits.
Deals, Deals, and More Deals
It’s a great publicity stunt for companies, but there are some Leap Year deals worth considering for consumers. There are good deals for car rentals, airline tickets, hotels and resorts. Verizon wireless is having a huge sale online today for their 4G LTE smart phones. Deals can be found almost anywhere today, in store or online. Companies are really trying to cash in on this special day.
Take advantage of the savings offered today. Especially if it’s something you really need for your family, house or something for work. Just don’t go overboard on the spending. Remember the difference between “want vs. need”. Shopping smart and being frugal are not hard to do in today’s economy.
Leap Day Only Savings
Many vendors are offering perks and freebies for Leap Day, according to the Passion for Savings blog and various other media outlets.
Here are a few national chain deals:
- Chick-fil-A: Free Chick-n-Minis 4 ct. boxes from 2 p.m. to 5 p.m. at participating stores
- Caribou Coffee: Buy one, get one free coffee with coupon
- Buca Di Beppo: $29 meal deal for 4 people with coupon
- Subway: Free cookie with any purchase
- Einstein Brothers Bagels: Buy one lunch, get one free
- Bath & Body Works: Free fragrance with any $10 purchase
- Denny’s: Get 29% off your check on Wed. – Sun. with a coupon. Expires March 3rd.
- McDonald’s: Buy-one-get-one-free offers on particular sandwiches, a cup of coffee on the house, as well as 29-cent hamburgers at participating stores.
Whatever you decide to do today, make the most of this special day. You can make a commitment to getting out of debt. AdvantageCCS can help you. Contact us for more information on how we can help!
Image: Ambro / FreeDigitalPhotos.net
Teaching Kids About Money Management
February 27, 2012
Money management should be a required class in every school starting early on. Until schools really become involved in teaching our children about personal finances, budgets and money management; we must be that teacher for them.
When it comes to teaching your children about money, think of it as teaching them survival skills. If you do not teach them about money management, budgeting, saving, shopping and credit–it will be left to trial and error, which could prove to be very costly and time consuming. Take this opportunity to be the primary educator for your children’s financial future.
Themes to stick with – Save some, Spend some and Share some:
Save some – When your child has learned to multiply it’s time to explain the basics of interest. Keep a jar in the kitchen and as the jar fills with loose change, children learn the first steps towards savings. Also, teach them how to budget properly and the importance of an emergency fund. This would also be a good time to introduce the allowance and earnings strategies. If they do chores they can earn points or money to use on things they want to purchase in the near future.
Spend some – Shopping strategies and the wise use of credit, needs to be explained early on because this is where your children could get into serious financial trouble down the road. Shopping strategies such as comparison shopping and a discussion of “wants versus needs” is extremely important. Our wants are unlimited, but our money is not. Explain that credit is not free money. It may get us things faster but we may end up paying more for it over a long period of time.
Share some – Give some money to charities or to your local shelter or to your church. Explain the importance of sharing and helping other people who are less fortunate. Set a good moral example for them from the beginning. Teach them how to identify reputable organizations and causes for donations. Discuss their ideas for helping their friends, family and community.
Children Learn By What They See
It’s always been known that children learn by what they see and then imitate it. Parents need to examine their own money habits to make sure they are not showing their kids any bad spending habits. Take a close look at your relationship with money and make sure it’s a “healthy” one before passing along advice to your kids.
You must also teach them self-discipline vs. instant gratification. If you set them on a steady financial path now, you won’t have to worry about them in the future when they go out on their own. They will already know how to set up a budget, manage a checkbook, set aside savings, etc.
If you need any help teaching your children about money and personal finances, let Advantage CCS help you. We offer free educational classes and one-on-one phone sessions to help with credit counseling. Contact us today if you need help getting that debt monkey off your back!
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Secured Debt vs. Unsecured Debt
February 22, 2012
There are two main types of credit: secured and unsecured. Knowing the difference between the two can help you prioritize your debt payments. It is not uncommon for people to ask about the difference between the two and how they may affect your credit score. We’ll take a closer look at both of them and explain the differences.
Secured Debt -
Secured debt is debt that is backed by some type of collateral such as an asset or revenue from the borrower. You typically encounter secured debt when you purchase a large ticket item such as a house or a vehicle. Mortgages and car loans are two examples of secured debts. If you fail to pay back the loan as agreed, the lender can foreclose on the home or repossess the vehicle for non-payment. Because there are assets the lender can use those assets to recoup their loss in the event of a loan default, interest rates are generally lower on secured loans.
Unsecured Debt -
Unsecured debt is debt that is not guaranteed or “backed” by any type of collateral. Essentially this means that if you default on an unsecured debt there is nothing that the creditor can take back to recover their costs for non-payment of the loan. Interest rates tend to be higher on unsecured debt because there is no collateral for the creditor to seize if you default. Credit cards fall into the category of unsecured debt. A credit card company cannot seize any of your possessions if you do not pay off the balance. Creditors attempting to collect on a delinquent unsecured debt typically turn the account over to a collection agency.
How Secured Debt and Unsecured Debt Affect You? -
Both types of debt will show up on your credit report. A small portion of your credit score (about 10%) is based on the types of debt you carry and whether or not you have a “healthy” mix of credit types. The score takes into account if you have a mix of revolving credit (credit cards) and installment loans (mortgage).
Revolving credit are often the types of loans issued with unsecured debt. Your payment amount can vary, or revolve, based on your account balance and interest rate. Installment loans are typically issued with secured debt. For example, if you take out a vehicle loan, you are given a set schedule of payments. Your payment and interest rate generally remain the same each month until the loan is paid in full.
AdvantageCCS Can Help You Manage Your Debt -
With all types of credit, there are often steep penalties for not paying as agreed. If you’re having trouble managing your unsecured or secured debt, you should contact Advantage Credit Counseling Service and talk with a certified credit counselor. It is possible to get your debt under control, and the sooner you start, the sooner you can get on the path towards financial freedom!
Image: Pixomar / FreeDigitalPhotos.net
What to do if you are an identity theft victim
February 20, 2012
It seems like more and more shopping is being done online these days. It’s easy, convenient and can save time as well as money. With the increase of online shopping, identity theft has become a major issue. If you’ve ever been the victim of identity theft, you know all too well how it can ruin your credit and upset your way of living.
We’ll give you some tips and advice on what to do if you think you’ve become a victim of identity theft. Many people think you just need to call your credit card company and they’ll sort it all out. That’s one part of the process but there’s a lot more. There are certain steps you should take to ensure you deal with it swiftly and correctly. We recommend that you take the following actions ASAP, and keep records of your conversations and copies of all correspondence.
Actions to take to STOP identity theft from ruining your life:
Credit Card Companies - Call the credit card companies that you think have been affected. Alert them immediately as soon as you even suspect something is wrong. They will put a hold on that card or cancel it altogether. Ask to speak with someone in the security or fraud department of each company. Follow up in writing and include copies of supporting documents. Send your letters by certified mail, and request a return receipt so you can document what the company received and when.
Fraud Alert to the Credit Bureaus – The three credit bureaus are Equifax, Experian and TransUnion. Place a fraud alert with one of them right away. You need to contact only one of the three companies to place an alert. The company you call is required to contact the other two, which will then place an alert on their versions of your credit report. Let them know what happened and give them any information you can to back up your story. Fraud alerts can help prevent an identity thief from opening any more accounts in your name.
Review your Credit Report – Once you’ve placed the fraud alert on your file, you are permitted to order free copies of your credit reports, if you ask. When you get your credit reports, review them carefully and thoroughly. Look for inquiries from companies that you haven’t contacted, accounts that you didn’t open, and debts on your accounts that you cannot explain. Highlight or circle anything that looks suspicious or out of the ordinary.
File a Police Report – File a report with your local police department or the police department in the community where the identity theft took place, if you know it. Then, get a copy of the police report or at the very least, the number of the report. It can help you deal with creditors who need proof of the crime. Be prepared for those phone calls with your creditors beforehand.
Close Accounts that are Fraudulent – Close the accounts that you know, or believe have been tampered with or opened fraudulently. If the identity thief has made charges or debits to your accounts, or has fraudulently opened accounts in your name, ask the credit card company or bank for the forms to dispute those transactions. Also request the transaction records relating to the identity theft, such as the fraudulent credit application. Keep everything for your records.
File a complaint with the FTC - By sharing your identity theft complaint with the Federal Trade Commission, you will provide important information that can help law enforcement officials across the country track down identity thieves and stop them. You can file a complaint online at http://www.ftc.gov/idtheft by phone 1-877-438-4338 or by mail to 600 Pennsylvania Avenue, NW, Washington, D.C. 20580.
If you’ve ever been the victim of identity theft, please share your story with us. Let us know what steps you took and how it all turned out. We’d like to hear from our online subscribers. Thank you!
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