Tag: Financial

Financial Mistakes To Learn From

In this day and age, there really shouldn’t be any reason to make certain financial mistakes. Do a search of the internet and you will find that there are thousands of articles out there that warn you of the pitfalls of certain choices. Advice for living a financially stable life is everywhere. What are you waiting for?

Financial Mistakes

Here are the most common mistakes that I’ve seen people make. I’ve even made a few of them myself. These are the financial mistakes that you can learn from. You’ve probably made a few of them yourself, they are very common.

Mistake #1: Using that little plastic card to get what you want.

We’ll just start off with the number one mistake out there. This is probably the most common mistake in the country. Almost every person in the US today has a credit card. It is almost like a right of passage when you turn eighteen. There are even people out there that aren’t eighteen yet that have them.

Credit card debt is the fastest way to ruin your finances. It is easy to acquire and difficult to pay off. The minimum balance doesn’t pay off enough of your outstanding balance to help you very much. You will be paying on your balances for decades. Even a $500 balance can take you over a decade to pay off if you simply make the minimum payment.

Add in the interest rate, which rarely goes down. If you miss a payment, you will really be paying the bank. Thirty percent interest is common on a credit card once a payment has been missed. And you only have to miss that payment by a day — which can happen in the mail or processing if you don’t plan ahead well enough.

Mistake #2: Buying more home than you can afford.

With the real estate market in the state it is today, many people are regretting their housing decisions. Adjustable rate mortgages are acceptable loan products for some people. But only if they can afford the maximum rate that the loan can hit if interest rates go up. Too many people only consider that introductory rate. They stretch and purchase as much as they can afford. Then, when rates go up and their rate adjusts, they can’t afford the payment. Add that to a slowing housing market, and you may have a foreclosure on your hands.

If you are going to buy a home, make sure that you purchase what you can afford. Take out a fixed-rate mortgage so that you know what your payments will be. If rates go drastically down in the next couple of years, you can always refinance. If rates go up, you are protected. Try to aim for a 15-year mortgage over a 30-year. It will save you hundreds of thousands in interest. But if you can’t do it, a 30-year fixed-rate mortgage is an acceptable loan choice for the purchase of a home.

Mistake #3: Not controlling your money.

Too many people live paycheck to paycheck. They have no savings. They have no retirement plan. They have nothing to back them up in the case of an emergency. They have no control over their money.

You have to take control of your finances if you want to retire someday. You have to learn how to budget, save, invest and spend. All it takes is a little time. And once you get in the habit, you will notice that your life has more control. You should say where your money goes, not lenders or creditors or anyone else.

Mistake #4: Not saving for retirement.

There are more seniors in the work place now than there were twenty years ago. And even more than there were fifty years ago. If you want to retire with enough money to live comfortably, you have to start putting something back today. Start an IRA. Contribute to your employer’s 401(k) plan. Figure out how much you need to invest and find a way to do it. This is your future. You don’t want to reach sixty and realize that you can’t afford to stop working. There is no guarantee that you will be able to draw social security or other forms of assistance then. What if you become ill and have to retire? What if you get hurt? Prepare for the future. Start saving for retirement today.

April 12, 2025
Financial Options After One Has Declared Bankruptcy

Bankruptcy is a financial option for those individuals whose debt has run away from them. It is not that hard to experience debt issues and individuals have had to declare bankruptcy in order to dig themselves out of the surmounting debt. The term bankruptcy has negative connotations however this should not be the case. An individual who declares bankruptcy is taking that big step in order to get their finances under control and wipe the slate clean. Individuals may be hesitant to do so as they feel their life post-bankruptcy will be financially constrained. This is not so and the following paragraphs will highlight some financial options one has following the declaration of bankruptcy.

Financial Options

Mortgage after Bankruptcy

One issue that disturbs individuals considering filing for bankruptcy is that they may never be able to obtain a mortgage after bankruptcy declaration. The fact is that individuals who have declared bankruptcy have been able to obtain a mortgage after that proceeding has been completed. Most individuals looking to obtain a mortgage post-bankruptcy will have to wait until the bankruptcy is final and proceedings have been completed yet there are lenders who are more than willing to lend to an individual post-bankruptcy. Bankruptcy mortgage financing is available to many individuals who are in that predicament. Some lenders may deny loans to these individuals yet there will always be other ones who will finance home loans after a bankruptcy declaration.

Credit Cards after Bankruptcy

Another issue which individuals find themselves contemplating both prior to and after declaring bankruptcy is whether or not they will be able to obtain credit cards after bankruptcy. Credit cards are extremely important items for many individuals as they provide a way for people to make large or vital purchases and then pay back the debt on a monthly basis. It is important to note that credit card companies will and do provide credit cards to individuals who have declared bankruptcy. Although some credit card companies will be more selective than others, it is necessary to point out that there are options with regard to obtaining credit after bankruptcy.

Personal Loans after Bankruptcy

Individuals who have declared bankruptcy may also be able to obtain personal loans. Personal loans are used for a variety of reasons such as college, home improvements, or purchasing a car. A personal loan after bankruptcy is not a rare occurrence and a variety of lenders will make this option available to borrowers who may have fallen on hard times in the past

Summary

There are certain instances in individual’s lives when they need to declare bankruptcy. It is crucial for these individuals to keep in the back of their mind that declaring bankruptcy will not definitively thwart any future loans which they need to acquire in the future. One who seeks bankruptcy advice should also inquire about credit repair after bankruptcy and what the future may hold for individuals like themselves who need to declare bankruptcy.

April 12, 2025
Financial Fitness Checklist

To find out just what kind of financial shape you’re in, answer the questions in the following Financial Fitness Checklist.1 If you’re married, print this out and take it home so that you and your spouse can work together to answer the questions. Make a note of how many questions you answer yes to.

Financial Fitness

1. Are you using more and more of your income to pay your debts?

2. Do you make only the minimum payments due on your loans and credit cards each month?

3. Are you near, at, or over the credit limit on your credit cards?

4. Are you paying your bills with money intended for other things?

5. Are you borrowing money or using credit cards to pay for things you used to buy with cash?

6. Do you often pay your bills late?

7. Are you dipping into your savings to pay current bills?

8. Do you put off visits to the doctor or dentist because you can’t afford them?

9. Has a collection agency called recently about overdue bills?

10. Are you working overtime or holding a second job to make ends meet?

11. If you or your spouse lost your job, would you be in financial trouble right away?

12. Do you worry about money a lot?

If you answered “no” to all questions on the Financial Fitness Checklist, you’re the picture of financial health.

One or two “yes” answers, while not necessarily a sign of impending doom, can be a warning sign of potential problems. Before things get any worse, take time now to draw up a realistic budget (including a savings plan) or to revise your spending plan. Cut back on your use of credit cards, and watch closely for other signs of financial trouble.

Three to five “yes” answers could mean that you’re heading for financial trouble. It’s imperative that you get your spending under control right away. If you don’t have a monthly budget, draw one up and follow it. Put away your credit cards and cut out all unnecessary spending until you can answer “no” to all the questions on the Financial Fitness Checklist.

If you answered “yes” to more than five of the questions on the Financial Fitness Checklist, you may already be in serious financial trouble. But don’t despair. Financial counseling can start you on the road to financial recovery.

April 12, 2025
Financial Balance: Reducing Unnecessary Spending

If Americans were polled about their personal concerns, at the top of the list would be finances. Finances are important in our lives, from the national budget to the family budget, and when our finances are unbalanced, it can lead to serious trouble. Not only are bad finances linked to a significant number of failed marriages, but our personal financial history becomes public record when we apply for a job or credit.

Financial Balance

Living month-to-month or buried in debt is hard, but many people don’t have to live that way. Simply reducing unnecessary spending will help to balance the budget at home and free up money for paying off debts.

Implement one or more of the following helpful suggestions to aid in balancing the home budget, and breath a little easier.

Limit eating out

If you’re like most Americans, you eat out at restaurants, fast-food or not, far too often. Setting a limit to the number of days or times we eat out per week will not only help our waistlines, but our wallets as well. The cost of one restaurant meal can feed an entire family of four for dinner at home, and simply eliminating that cup of coffee and donut in the morning can save up to $1,300 per year! Spend less than half that amount by making coffee at home and popping a bagel in the toaster.

Take stock of your utilities

Utilities are impractical to eliminate, but their cost can be greatly reduced. Many gas and electric companies provide discounts for upgraded appliances, or percentages off bills that show a decrease in power usage. Also, eliminate any unnecessary phone services, such as Caller ID or Call Waiting. Remember to check the monthly water bill for signs of a leak, which can cause a huge financial impact. Overall, review charges and statements each month to avoid paying for unused or undesired services.

Get a new quote

Many people go year to year not realizing they can make a change on their homeowner’s or vehicle insurance. Getting a new quote can be as easy as spending a few moments on the internet providing some key information. The savings can be drastic, especially if multiple insurance policies are purchased from the same company. As with the utilities, coverage should be reviewed periodically for changes that can be made.

Reduce unnecessary travel

Most people have multiple errands to run each week. Running all errands in one weekly trip will save gas money, as well as costly wear-and-tear on the vehicle. Also, limit vacations and out-of-town travel to the most necessary of events, such as weddings and funerals. Forgoing unnecessary travel will tremendously help the budget.

Give up a little entertainment

Eliminating a few channels on the cable or satellite television service can save substantial money each month. Are the movie channels really necessary, and are they watched that often? Magazine and other entertainment subscriptions should also be looked at as a possible area in which to save money. Do you really need 14 magazines every month? Anything that isn’t used or read should be eliminated.

Keep a budget and stick to it

Finally, the most important aspect of balancing a budget is to know what the budget calls for. Make a list of all necessary items and their cost each month, and on that same paper write down the expected monthly income. Remember to budget a little extra for emergencies or savings. Cut down wherever possible to keep expenses below earnings. As the amount of money left over increases, more money to pay off debts or enjoy a splurge here and there becomes available. Remember to make a new list each month, crossing off bills as they are paid, in order to avoid late fees – which will only add to next month’s bills.

April 12, 2025