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money management tips

The Beginner’s Guide: 7 Tips for Managing Your Money

March 31, 2014 by editor

Managing your money can be hard, especially if you’re in your 20’s. Figuring out a workable budget, whether you are a college student, buying your first apartment, or in debt, is not only a good idea for your finances-in many cases it’s an absolute necessity. Want to know how to maximize your cash without being overwhelmed? Here’s 7 simple tips to help you manage your next pay day and beyond!

1. Spend According To Your Needs, Not Your Paycheck

For most Americans, they are one paycheck away from destitution even though they are paid well or hold two jobs. Why is this trend so common? They spend what they have, instead of what they need. Especially when you just start out in a new place or in a new profession, your lifestyle can turn expensive very quickly. A car, professional attire for your job, a deposit on an apartment, or furnishings for your new home can add up in a short amount of time.

How do you make it easier to manage your money in these times? By spending what you need instead of what you have. Liz Pulliam Weston, author of ‘The 10 Commandments of Money” explains that living scarcely and having the bare minimum after you get a new job or place is one of the best ways to get a hand on your new expenses and save money at the same time.

2. Returning Home Instead

Although most people just out of high school are eager to get a taste of independence and leave the family home, studies show that around 85% of new grads return to living with their parents within the first two years after high school. For most young adults, this is the first experience they have with the job market and managing their money. Consider these four benefits that living at home offers:

  • Financial Flexibility
  • Minimal Expenses
  • Time to Create a Budget Without   Real-World Pressures
  • Opportunity to Save Money

3. Credit Cards: Make Them Work For You

Debt, especially from credit cards, can add up to monstrous proportions after college, a time when not only do expenses skyrocket but your salary remains the same. Riddled with high interest rates and expensive late fees, credit cards are considered big no-no for people in the beginning stages of managing their money. However, what if you want to raise your credit store and lower those interest rates? With 75% of the currency in the United States being in the form of credit, having a credit card can not only be useful but also help you make the most out of your financial situation if kept tightly reined. Here’s some guidelines on how:

  • Spend A Small Amount Each Month, No Higher Than $20
  • Add Your Credit Card Payment Into Your Budget
  • Save It For Actual Emergencies

4. Paying Off Your Debt

If you’re in college, you know all about being in debt. Credit cards and student loans are easy to get for the person just starting out–and hard to pay off. If you owe money on several credit cards, CEO Bill Hardekopf recommends tackling the lowest limit first. Not only will it be less money to pay at once, but it will help keep the damage to your credit rating from being quite so devastating.

Stuck with student loans and no cash to pay them off all at once? Unless they           have extremely high interest, try to make on-time, steady payments each month to chip away at the overhead while you’re still in college.

5. Build a Nest Egg

Having extra money for a rainy day or unexpected expense is a smart way to manage your money. Weston suggests having a ‘cash cushion’ of at least $500 at any point in time. This is enough to cover unexpectedly high bills, car repairs, or even hospital visits. Setting aside 6 months’ worth of expenses coincides with a flexible time-line that takes into account your expenses and is easily accomplished by adding a small amount of money to your savings each month.

6. Insuring Your Health

Having insurance is not just            a smart idea, it’s a necessity for managing your money! Having health insurance or rental insurance guarantees that if you have a major problem with your physical health or living area that you won’t be the one shelling big bucks. Although it might seem             counter-intuitive to spend your hard-earned dollars on something you might not use anytime soon, the modest payments add up for the day when you will really need them.

7. Have Goals

The key to avoid splurging your hard-earned dollars on junk is having long and short term goals.             Whether this is a car, house, or saving toward retirement, working toward your goals is a great way to make sure that you’re managing your money correctly.

Filed Under: personal finance Tagged With: Manage Your Money, Managing Your Money, money management tips

Money Management Tips To Stay Out Of Debt

March 4, 2014 by editor

There are numerous ways to manage your budget, reduce your expenses and to stay out of debt. Staying on and managing budget can be stressful and overwhelming but simple strategies are easy to carry out as they require less effort and at the same time easy to remember.

Determine your overall income

Are you on a fixed salary where you know for certain your monthly income or are you dependent on your daily wages? Whatever is the mode of income, you should have a rough idea of how much you can expect to earn so that you can successfully design your budget so that you don’t go overboard in your spending hence making it a beneficial tip to stay out of a debt.

Use a Budget Worksheet for Money Management

This may be time consuming initially but it surely is a great method to keep record of your spending. You can use either a notebook to keep a record of your daily expenditures and income or a computer spreadsheet, ever method seems feasible to you. Do it regularly to get an overview of your expenses. With this simple method you can stay in budget and can stay out of debt.

Pay Yourself First

Another tip to stay out of debt is to maintain and grow your saving’s fund so that in times of need you are not without any financial aid.  Make a habit of depositing in your savings fund, even if it is $10 or $20 per pay period. In real world you should shoot to save about 10% of your pay check. It is important to have a reserve available for emergency purposes or out of the blue expenses so that you don’t

Track Cash Expenses

Miscellaneous expenses and cash purchases are leech to any budget. You should resist cash withdrawal from an ATM and only do so when there is no alternate solution left. Give yourself a weekly budget and stick to it and even try saving from it too. Snacks, coffee, movies all should come out of your allocated allowance. This tip for staying out of debt can come very handy if used diligently.

Do Not Make Major Purchases Impulsively

Another tip to stay out of debt is to think before spending. If you are thinking of making a major purchase, spend some time contemplating it. Check its necessity level, look at your savings and calculate the amount left after making the purchase and look for sale and discounts offer for the best price. In this way you can save almost half of the money you were going to spend it. 

 Money Management Tips

Use Coupons and Discounts to Save Money

One of the best tips to stay out of debt is to keep your eyes open to discounts and coupons offers. Restaurants and chain retailers have various coupons and discount offers advertised on weekly bases even on daily bases too. Deals and offers on both food and leisure. If you have a keen eye you can collect and find out many great. A consumer almost never has to pay full price if he is willing to do a little research for very few things.

Use Generic Substitutes

Try using generic version of the product instead of the branded. Most of the time generic counterparts have more or less same substitutions. It’s always advisable to try a product before you purchase it in bulk. If you search the market good you will be able to find many generic products that are not only good when it comes to quality but also will be good for your monthly budget too.

Bundle Services for Savings

One useful tip to stay out of debt is to buy products in bulk. Not only this saves your time by not going to the market every other day but it is relatively cheaper at the same time. Many service providers offer great discounts for bundling a number of their items together. Dig deep into the companies you are currently using and compare their rates with the other available options in the market for the same services. Insurance companies offer discounts for bundling home, auto and boat insurances together.

Choose your insurance company sensibly.

Search the market for insurances in the same way as you do before buying any product. Look for companies that are reputable and offer you the best service for the least possible cost. Do not feel obligated to stick with the same insurance company just because you have used them for a long time.

Using Bill Consolidation to Reduce Your Monthly Expenses

If your finances include several credit card companies or other multiple bills you should try consolidating your bills in order to reduce your monthly payment.

With little effort we can develop a plan for staying or getting out of debt and securing your financial future.

Filed Under: debt management Tagged With: get out of debt, money management tips, money saving tips, Out Of Debt, TIPS TO STAY OUT OF DEBT

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