Make budgeting fun with these simple steps

Budgeting is a precise activity which allows you to see your financial leaks, for example if your expenses are bigger than your income, how well do you prioritize your money and how to determine the important steps you need to take to become financially free.

It is important to find your motivation

If you lack in this field, managing your budget will be nearly impossible. You must focus on one thing at the time, that you try to budget. If you have debts over your head, then the reason is more than obvious. You want to be debt free, which will bring you emotional and financial stability. Imagine the moment where your all debts are paid off, guard that feeling and it will guide you toward the ultimate goal. If you want to save some money, the most important thing is the reason, WHY? Maybe it’s for a house deposit or a new car, or you want to retire early. If you know the goal, the budgeting will be much easier.

Get a friend

Having someone to share your troubles and thought is much easier, than doing everything alone. Find a friend that has similar goals as you and update each other on weekly progress. If you set up the goals together, it will be much easier to advise and encourage each other. The most important thing is to feel that you are not alone in all this and you friend might give you an insight into the things you neglected to notice.

Compete with yourself

The biggest success you will achieve is when you beat yourself. It’s important to set up the targets and start competing with yourself. For example, you spent $500 on groceries last month, make a plan this month and be inventive, think about the idea if you could spend less than $500, this will give you encouragement and make you think. You will be working toward some goal, not against it. Or, how much money you can save on heating if you just turn down the thermostat when you are away? Or, how many days you can uphold without spending one dollar? Always find a way to set up new challenges to yourself and you are on the right track.

Treat yourself

By setting up the priorities, you will have the goals you aim for, and you will feel self-accomplished. This will mean you can expect awards, but be careful, by this we don’t mean if you managed to save few hundred dollars, you should all spend on shopping. If in the previous month you only brought sandwiches for lunch, choose a one day and treat yourself to one nice lunch with your friends. This is a nice way to celebrate your discipline.

Fill up your budget

Find ways to fill up your budget with additional activities, for example; you can use online to find another part time job, that won’t take too much of your time, for example trading binary options. You can invest $10 and expect to get $50, which is more than enough for the beginning. And with the help of binary option trading software, you will become an expert in no time.

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How to avoid money traps middle-class families encounter

Constant struggle combined with slow grow of salaries, and expensive cost of living have put middle-class families into a difficult position. While spending has become an inevitable and necessary activity, having a healthy budget and knowing how to manage with it may put your troubles at ease and help you avoid common money traps and with that maintain healthy financial stability.

Track money for the food

A big part of your budget goes on the food, but if you calculate your expenses closely, you will be able to determine where your money goes and where you need to cut some. By some experts’ estimates, annually, average American family waste on food between $1,350 and $2,275. If you reduce these expenses, you might be able to save a substantial amount of money. It is important to look closely, how often your family goes out to have a dinner or lunch, do you pack a lunch every day? If you adjust your consumption with reducing lunches and dinners in restaurants and packing lunches for school and work, you will avoid wasting money on food.

Cost of healthcare

This is one of the most troubling things that burdens the budget of middle-class families. Three years ago the expenses for health care were $8,800, but today they are $21,500, which means 144% bigger. While the medical bills and health care increase every day, the salaries remain flat. With this, middle-class families suffer a great pressure; that’s why it’s important to have emergency funds. The general advice for young people would be to put at least $1,000 in an emergency fund; the next step is to cut down their expenses and start saving for the next three to six months. The modern society has changed our perception, we don’t think about healthcare expenses anymore, but we call them medical emergencies now.

Housing cost

Apart from the medical expenses, housing costs are another burden on a middle-class family budget. Some people may think that it is better to own a house than to rent an apartment, but that’s not the ideal solution for everyone. The real value and mortgage value of the house is still big and if you burden your budget with 30 years of a mortgage with minimum, 3% down payment, this can cause you serious financial troubles. On the other hand, some people put a bigger down payment, 20%, but they forget about retirement and emergency funds. You can still invest 10% in down payment and add additional 10% in renovation, which will increase the value of your house for 20% in few years, you will also avoid paying mortgage insurance, but don’t neglect your retirement fund because you will regret it when you are old and gray.

Additional jobs

This can be great opportunity to fill up your budget until the next salary, but keep in mind that additional job can take too much of your time and make you even more exhausted. Unless if it’s something connected with the Internet, like trading binary options. With the help of this website, at the comfort of your home, you can easily earn weekly expenses for the groceries.

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Mistakes we make with credit cards

Many people have troubles paying off their credit cards, this has become a major problem in the modern world, because people pile up their debts on credit cards. But, how to avoid these mistakes and get in order our balance?

Pay as much as you can

It might be tempting only to pay a minimum balance, often $25, when you are in financial troubles, but don’t do that. In this way you will never pay off your debt and the card company will charge you interest with every new month. If you have a possibility, decrease your expenses and put your focus on credit card debt. You will be surprised to know how much it is easier to sleep at night, without having a huge debt hanging over your head. It may sound ridiculous, but when you increase your credit card payment, you will be saving the money. This all depends on an interest rate, but annually you will be able to save between 10% and 29% in interest and plus, you will be paying off your debt.

Credit card it’s not for everyday stuff

Your monthly income should cover your life necessities; with this, you will be taking a right step toward healthy budgeting. Things like groceries and utilities should stay away from your credit card. Remember, if you buy one can of coke with a credit card, it can soon become 30 cans of coke if you don’t pay off your bill at the end of the month.

Credit cards rewards should be taken into consideration

The rewards you might earn with a credit card, may not be the reward you expected at the end of the month. For example, this scheme allows you to gather some points if you spent a certain amount of money on your credit card. But, what happens if you can’t pay off the bill at the end of the month. Those rewards are often 2% or less. You should also avoid using multiple credit cards, regardless of the benefits they offer. If you already know that you have issues with credit cards, don’t fall into the same trap again.

Cash advance is a big no

Credit card companies have an excellent tactic by sending you checks once in a while on your mail and encourage you to use them to pay your shores and spend something on you. But, not any of these companies bothers to mention that these checks are cash in advance. Cash in advance is considered a really bad idea because you start paying the interest the moment you take the cash, there is no grace period, and you will be charged a fee around 4%. This altogether increases your interest rate until you pay off your credit card balance.

Many people use credit cards for another purpose, like trading binary options, this can be a certain way to make money, but only if you are sure that you are capable of getting it. The website offers a really good solution and advice.

graph chart with hand holding money

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Emergency fund that you might not need

For many years now emergency funds have been considered as something sacred. People save up for a whole year to put some money aside so that they could meet unexpected expenses, such as medical issues. Some financial experts give them priority over high-interest debts and sometimes even really emergency isn’t enough to touch an emergency fund. We often encounter statements of people online, like: “I lost my job, but I’m not touching mu emergency fund”.

The real question here is, do we need an emergency fund, if we manage our finances conscientiously?
A person who is disciplined and lives below of its incomes doesn’t have a justified reason for an emergency fund. For example, a person who doesn’t have debts and who spends only 80% of its incomes can go through a month without having an emergency fund. Depending on a person and its financial situations, various types of credits might be available, and they will be able to cover some of the unexpected bumps on the road. With the help of credit card cycles and decreasing some of the expenses, credit cards don’t have to be the only mean to cover debts.

In case a person loses a job, having an emergency fund can be something that will give him a little peace. In a perfect financial planning, 25% of person’s income should go on debt repayment and savings. The larger expenses go on housing, 35%, and life, 25% of the income. When a person loses a job, he stops saving the money and uses 75% of its income to cover unemployment benefits. In one hand, the unemployment won’t pay you 75% of your income, but not having expenses related to going to work every day might be able to help you fill in the gap.

One of the best things financial experts advise considering not having an emergency fund is avoiding additional expenses which are connected with a maintenance of a large amount of money sitting in your bank account. The emergency fund might be able to give you peace of mind, but it is a much better solution to use that money to pay off your debts, instead of piling up the interest. In this case, you will always be in advantage. For example, a person who has financial discipline doesn’t mean it’s debt free, average debt that is covered by the credit card in America is measured around $5,600, an interest that people pay is about 13% annually, that is $728 each person pays at the end of the year. By having an emergency fund of $10,000, you can’t earn that much money every year, which leaves you with a double loss.

Many people find additional ways to earn money, so they can leave something aside. They use various online sources, such as binary options to make some money. This can be an excellent opportunity, only if it’s used wisely. There are various binary strategies people can use that are safe, and that can bring substantial earnings.

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Money saving tips for young adults

Personal finance is one of the most important subjects in the life over all, even though it’s not included as a subject in high school or college programs, young people are often clueless how they should run their finances. However, this may seem tiresome and excruciating experience, but all it takes is a few useful advice, and you will be on the right path.

Self-control is important

If you had luck, then you managed to overcome this with the help of your parents from early ages. If not, the quicker you learn to avoid unnecessary pleasures, the easier you will get your finances in order. Nowadays, credit cards have become widely accepted and used but do you want to buy everything on your credit card or do you want to save money, so you can afford those stuff. Sometimes, the box of cereals or a new pair of shoes may cost you much more than you have expected. If you have a habit paying everything with a credit card, and it doesn’t matter if you have means to pay the bill at the end of the month, you might be paying for those stuff in the next five years. It is important to keep track of your balance and to pay bills as they arrive.

Take charge of your finances

There are many people around you who will try to help you regarding this matter, but not any one of them know the real state of your finances. Some of them will have the best intentions on their mind and still give you bad advice. Instead of listening to others, educate yourself and take control over your life and financial situation. Don’t let anyone tell you what to do, for example, your friends make you spend tons of money for one go out. It is important to understand how money works and to realize how hard is to earn it.

Keep track of your money

Once you educate yourself regarding this subject, you will realize how important is for your expenses not to exceed your income. This can be achieved by budgeting. At the beginning of month calculate all your expenses and keep in mind not to spend money only if it’s not necessary. For example, why will you need to rent an expensive apartment now, when in few years you will be able to buy a nice condo or a house.

Fast money won’t make you rich

Many young people find different ways to make many quickly and in that process, they risk losing all. One of those ways is trading binary options. Since they become so popular in the recent few years, binary options have managed to conquer the financial market and to become a competitive source of income. Don’t take us wrong; you can make money with binary options, but this type of trading should be taken as a side activity that is intended for serious traders, who know what they are doing.

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