Mom and daughter learning about saving

Parents Teach Your Kids To Invest In Their Piggy Bank

August 7, 2017
, , , , , , Finance

Parents have the sometimes daunting responsibility of teaching their children how to manage money. At a young age, this usually involves saving pocket money to buy something they really want. Once kids understand the concept of money and saving, you can take it a step further and broach the subject of investment. It does not have to be overwhelming, it can be fun, according to Marissa Schulze playing games like Monopoly or Monopoly Junior is a great starting point.

“Your children will have fun while learning that they more money they have invested in property, the more rental income they will receive and the easier it is to become wealthy and win the game,” she said.

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You should teach your younger children about using cash as money has become invisible, money is a debit card and we’re not seeing money in notes as much anymore.

You can divide their money into three categories, spend, save and give. This teaches them to be responsible with their money and to be more involved in helping their community. Scott Pape uses the ‘jam jar’ approach to make the process easy to understand.

Discuss where and why you invest in certain portfolios with your teenagers. If they show an interest in following the share market you can discuss possible future investments and keep track of certain shares regularly. This way you ensure they are educated to make the best possible investment choices for their savings.

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Financial Expert

5 Top Financial Experts to Pay Attention to

August 2, 2017
, , Finance
Are you in need of financial advice but don’t know who to turn to? Try these consensus best financial experts for your personal finance advice.

Keyword(s): Financial Experts

Personal finance is just that: personal. Everyone has different goals and different barriers to achieving them.

But you don’t have to reinvent the wheel to reach your financial goals – no matter how personal or unique they are. That’s why we have financial experts.

There are people out there who have dedicated their lives to helping people achieve financial freedom whatever their path. And they all offer different methods for doing just that.

Want to know if there’s a pro out there who is right for you?

Check out these five financial experts:

Dave Ramsey – Eliminating Debt

Dave Ramsey first got into personal finance in the 1980s when he dove into the foreclosure real estate market. His portfolio was worth around $4 million.

Then, he lost everything.

After working his way up the financial ladder only to tumble back down, Ramsey knew he had to start over. He also knew he had to do things differently.

Today, Ramsey runs a popular AM radio show and has authored several popular money books. His message is consistent throughout: avoid debt.

His status as one of the top financial experts lies in that his advice is simple to understand. But it is also a fundamental part of money management. Essentially, he provides great advice for those who need help turning their lives (and finances) around.

Ramsey hates credit cards and prioritizes paying off debt above anything else. He advocates for putting aside a $1,000 emergency fund, forgetting about retirement, and then going hog wild on any debts incurring interest, starting with the smallest balance first.

Essentially, he argues that once you’ve eliminated all your debt, you’re free to save for all kinds of other things.

So, if you maxed out a few credit cards in your youth (or adulthood) and need to figure out how to pay off that high-interest debt, Dave Ramsey is your man and the debt snowball is your plan.

Grant Cardone – Adding Income Streams

Grant Cardone is a professional sales trainer with a unique message for his followers: spending and debt aren’t a big deal.

His trick? Simply make more money.

Cardone is a big believer in potential – earning potential. The best way to deal with the expenses associated with daily life is not to minimize debt or whittle your household budget down to next to nothing.

Instead, those looking for financial freedom should aim to catapult themselves into the high-earner category. You know, the St. Barth’s at New Year and Martha’s Vineyard in the summer crowd.

His perspective on spending is different from most other money management gurus, but Cardone knows what he’s talking about. He’s currently living his own advice.

Cardone used his own finances and traditional bank loans to snap up $350 million in multi-family residential real estate across the United States. His real estate side-hustle provides him with enough extra income to own and maintain a Gulfstream G200 private jet.

Check out Cardone on social media to see into the life of one self-made multimillionaire and grab some inspiration for a side hustle of your own.

Gerald Celente – Surviving Financial Apocalypse

Gerald Celente is the economist best known for forecasting and managing trends.

What does that mean? He reads current events and analyzes them (without political bias). That analysis is used to see into the future – the financial future.

Celente looks for the warning signs that signal upcoming financial meltdowns.

He’s the one who got you interested in the subprime auto-loan bomb poised to damage the American economy.

He’s worried about the threat of war sending gold prices through the roof and the imminent collapse of the financial markets because of the humungous debt.

He worries a lot.

His forecasts are not filled with rainbows and sunshine. But they are of use to those who want to future proof their finances in the event of another economic crisis.

Chris Hogan – Preparing for Retirement

Chris Hogan is a member of the Dave Ramsey team. His mission? To prepare Americans for a long, relaxing retirement.

Speaking as a former banker, Hogan says those looking forward to retirement need to consider what kind of retirement they want to have. He and his team developed what they call the R:IQ – or the Retire Inspired Quotient.

The goal is to help anyone thinking about retirement – at 30 or at 60 – figure out what they want from retirement. Once you know what you want, it is far easier to transition into actively planning and saving for it.

Hogan doesn’t want you to throw a random amount of money into a retirement account and call it good. He wants clients and readers to get what they want out of their retirement years whether that means living frugally or finally splashing out.

Chris Hogan’s advice is ideal for anyone who is ready to start thinking about the future they want whether you’re 35 or 65.

Tony Robbins – Creating a Mindset for Success

Tony Robbins is a financial coach, but he’s also a self-proclaimed life success coach.

Rather than bad-mouthing credit cards or focusing on trimming your budget, Robbins wants to help create mindsets prepared for success.

That means he wants to talk about more than numbers. Robbins is also interested in helping you develop the mindset required to make changes to your financial situation.

Robbins offers a series of mind development tools that allow anyone to better prepare themselves as a whole and support financial success. He talks about dedicating time to reading, giving back, asking the right questions, and learning to visualize your goals.

Effectively, Robbins offers a more holistic view of personal finance centered on personal responsibility.

Robbin’s advice is great for people who know the basics of personal finance, but who need to alter the way they think to match what they know.

There is a financial expert out there for everybody regardless of age or financial goals. There’s no need to blaze a new path when you can take the most lucrative road available.

Have you thought long and hard about your own personal goals? Have any tips you’d love to share? Let us know in the comments below.

Misinformation: 5 Common Credit Card Myths

Are you looking to get off on the right foot with your personal finances? Then you should take a look at 5 Basic Personal Finance Facts People Overlook.

It can be tricky to know just where you stand with your finances. Many people are full of sage advice that’s just plain wrong, and it’s easy to get caught up in misinformation when managing your finances.

The way we use our credit cards is one of the biggest causes of misinformation out there. We’re myth busting and giving it to you straight, so you’ll know exactly where you stand and which myths you can ignore.

Read on to learn the common myths that you may have believed in the past.

The Most Common Credit Card Misinformation

As of October 2014, the Reserve Bank of Australia reported that there were more than 15 million charge accounts and credit cards. And credit card debt was heading close to $44 billion.

Big businesses are also investing more into the industry in Australia. IBISWorld reports that between 2010 and 2015, the industry had a revenue of $11 billion. Annual growth was also at 2.7%.

This is because consumers can get credit cards at department stores, supermarkets, and even while flying at 35,000 feet. That’s why it’s so important that people understand how their credit cards work. Here’s some of the most common misinformation:

Myth 1: You Should Always Carry a Balance

No one really knows how this misinformation became so popular, but it’s a big one. Many people think that once they have a credit card they can then buy things and pay them off over a period of time.

While this is possible, it’s not a good idea. Using your credit cards responsibly means paying off the balance in full each month.

This saves you interest charges, and will sometimes even give you interest-free days. Those interest-free days can be used when you make purchases the next month.

When you’re carrying a balance on your card, you’re losing money every month as you’re only paying off the interest. And if you are applying for credit elsewhere, you’ll have to declare the debt on your card and may look irresponsible to those lenders.

Don’t forget: If you fail to pay the minimum payment each month, you can be in huge trouble with your bank. You can expect to be charged fees for failing to meet your obligations. If you continue to default on your payments, your account will eventually be sent to collections.

Myth 2: Getting Credit Cards Hurts Your Credit Rating

The credit rating system works a little differently in Australia than it does in other countries. Unlike some countries, your credit rating usually isn’t common knowledge.

However, banks, mobile phone companies, and mortgage insurers will often check your rating. That’s why it’s so important that you’re being responsible with any credit you have.

Actually, a successful history of using credit cards is likely to have a positive impact on your credit rating. Your rating is made up of a number of different factors, including:

  • Types of credit
  • New credit
  • Length of history
  • The amount you owe
  • Payment history

Generally, the biggest attention is given to your payment history and the amount you owe. A good track record of paying off your balance each month will show a responsible credit history.

Successfully applying for a new credit card will help you generate more credit history, which is a good thing.

Myth 3: A Credit Card Equals Debt

Credit cards have gotten a bad reputation lately. There’s a lot of misinformation about healthy financial habits and credit card debt.

Some people automatically associate credit cards with poor financial habits and debt. This isn’t true, and people have credit cards for a variety of reasons including:

  • Airpoints
  • Financial backup
  • Flexibility
  • Convenience
  • To generate a credit history

The key is to manage your available credit well. Your credit limit is the total amount you can put on your card, but this isn’t a goal.

You may have a credit card that has a limit of $10,000, but if you’re paying it off in full each month, you have a period where you’re debt free.

Myth 4: Cutting up Your Card Will Fix Your Debt

For some reason, cutting up your credit card has become synonymous with dealing with debt. The actual action of cutting up your card doesn’t change the fact that you still have an open account and a balance on that card.

Cutting up the card will stop you from using it for any future purposes, which is great if you’re carrying a balance. But unless you actively pay down the balance, you’ll be getting a call from a collections company.

Once you’ve paid off your balance, cutting up your card can feel liberating. Just remember to cancel the actual account, otherwise, you’ll still need to pay annual fees.

Myth 5: Introductory Interest Rates are the Answer

There are now a number of 0% interest credit cards available. These can seem like the answer to all your problems- after all, you’re probably paying a big chunk of interest each month if you have a balance.

These can be a great choice if you’ve made a firm commitment (and a budget) and you’re ready to pay off your entire balance. But there’s a lot of misinformation about these cards.

Many people are unaware that these low rates are only for a short period of time. After your introductory period is up, you may even end up paying higher rates than you were with your old card.

Transferring your balance to another card can be a good option, but only if you have a solid repayment plan. The goal should be to have your balance completely paid off within that time period.

You also may not be able to transfer your entire balance. Some credit card issuers will only let you transfer a partial amount of your credit limit. This can range from 80%-90%, and that would mean you would have two credit cards to pay off.

It can also take some time for credit card companies to transfer your balance between them. It will often make more sense to simply focus on paying a large chunk off your balance each month.

Are you surprised by any of the above myths? Have we busted any that you were unaware of? Let us know in the comments below if you’ve been caught out by any of this misinformation!

 

 

 

 

 

 

5 Basic Personal Finance Facts People Overlook

 Are you looking to get off on the right foot with your personal finances? Then you should take a look at 5 Basic Personal Finance Facts People Overlook.

Whether you’re starting your career or you want to get your personal finances in order, knowing basic facts about finances can move you in the right direction.

Often, people are guided by misconceptions or falsehoods, and this can lead to missed opportunities or even bad investments.

To help set you up to succeed, we’ve outlined 5 finance facts people often overlook:

1. Investment Gains

You found a perfect investment, and now it’s time to cash in.

At this point, many people fear withdrawing their money because they’re afraid of the tax penalties that go along with what they’ve earned.

However, there’s a huge misconception over what you are taxed on.

For example, if you invest $50,000 into a stock and over time you end up with $100,000, with a 15% tax, you may believe you owe $15,000 in taxes off the sale of your stock.

That would take a huge bite out of your profits — and luckily, this isn’t how investment gains work, so be careful not to overlook this fact.

Although you will be taxed, you are only taxed on what you made.

That means anything you initially invested isn’t taxed — only the money you will take home at the end of the day.

In the above example, since you made an initial investment of $50,000 and ended up with $100,000, you made $50,000. After a 15% tax on what you earned, which was $50,000, you owe $7,500 for your gains — a much better price tag than what many people believe to be $15,000.

So although you do have to pay taxes on what you earn when it comes to capital gains, the hit isn’t as bad as it seems.

So go ahead, take a risk and invest.

2. Higher Tax Bracket

If you’re straddling the line to the next highest tax bracket, you may be afraid working a few extra hours of overtime or that holiday bonus will put you over the edge and wipe out all of your hard work.

But this is a personal finance fact people often overlook.

A few extra dollars — even a few extra hundred — won’t hit you very hard when it comes to taxes, because not all of your income is taxed at the higher percentage.

Take a look at how the IRS has broken down the tax brackets for a single person in 2016:

10%: $0 to $9,275
15%: $9,275 to $37,650
25%: $37,650 to $91,150
28%: $91,150 to $190,150
33%: $190,150 to $413,350
35%: $413,350 to $415,050
39.6%: $415,050+

If you bring home a $36,500 salary per year, you’re inside of the 15% tax bracket.

However, what happens if your boss gives you a bonus? If you get a raise to $38,000 per year, is it even worth it?

Many people believe earning an extra $1,500 per year means they would be bumped up into the 25% tax bracket, which means they’d be taxed at 25% of $38,000, which would be $9,500 compared to $5,475 previously.

At those numbers, you would be making $2,525 a year more if you made $36,500 without a raise or bonus. And that’s little incentive.

Luckily, that’s not how the tax structure operates.

If you fall into the 15% tax bracket, the IRS taxes you 10% on the first $9,725 of your income. Anything you make after this, as long as you stay in this bracket, is taxed 15%.

If you get bumped into the next tax bracket for any reason, the math is still similar. You are still taxed 10% on the first $9,275 you make. You are then taxed 15% on the next amount between $9,275 and $37,650. Anything above the $37,650 mark — within the 25% bracket — is taxed at 25%, and so on.

By using this logic, you’ll never end up in a situation where you make less even though you were paid more.

3. The “Tax-Free” 401(k)

Many employees constantly hear the term “tax-free money” when it comes to putting savings into your 401(k).

But as the saying goes, there are two guarantees in life — death and taxes.

And there will come a day when the taxes will need to be paid on the money you’ve placed in your 401(k).

It is true that in the years you contribute to your 401(k), any money you put away is not taxed and your taxable income will actually decrease by the amount you invested.

But when you retire, eventually you will need to withdraw that money — and this is when the “tax-free” notion disappears.

 

 

However, when you retire, you normally draw from your 401(k), possibly a pension and maybe Social Security, so your income should be lower than when you were working full-time.

This means you will be in a lower tax bracket, which means you will be paying less taxes — sometimes significantly less — that you would have when you were shielded from paying them when you were contributing to your 401(k) originally.

 

So while it may not be “tax-free” money, you can consider it “taxed-later” money.

4. Renting vs. Owning Your Home

You may think owning a home means you’ve achieved your dream and you can stop throwing your money away on rent — but this isn’t always the case.

Just because you own a home doesn’t mean you have the ability to cash out and strike it rich.

Although when you rent a property you do have to pay rent and renter’s insurance and this isn’t an investment for you, it is relatively cheap compared to buying a home.

However, if something breaks, leaks or caves in when you’re renting, you aren’t responsible for the damages and repairs.

You also won’t have to come up with the money to fix the problem right away.

Buying a house is more than investing in its equity.

When you make the initial purchase, you need a down payment (which can be as much as 20% in certain areas), closing costs, insurance and other fees. Plus, you’ll be responsible for all of the maintenance and upkeep of your home.

All of this can add up, and if you’re not financially secure, you can end up losing your investment.

 

 

However, buying your own home can be the right choice if it’s the right period in your life — if you have a stable career, a nest egg and a great credit score, this could be the right move for you.

5. Big Refund = Big Ripoff

During tax season, many people look forward to their tax returns.

But when the government gives you a payout this time of year, it actually costs you money.

The check you receive from the IRS is money you’ve already made, the government is simply sending it back to you — hence, it’s called a refund.

What’s so bad about getting this back in April every year?

If you have the money available to you throughout the year, you can do more with it.

For example, if you get a $3,000 tax refund, you could have invested that money throughout the year — so it could have been working for you and earning you interest instead of being in the government’s hands.

However, if saving isn’t your strong point, it can be a good idea to use your tax refund as a way to save — just keep in mind you won’t be making any interest off it.

Don’t Overlook Basic Finance Facts

When it comes to your bank account, being knowledgeable about simple facts can go a long way.

Click here for ways to brush up on your personal finance skills.

Contact us today with any questions about financing and getting the right loan for you.

 

 

Cash vs. Credit: Knowing Which to Choose

Do you have a car time deciding when to choose cash or credit? Here is the information you need to choose with financial certainty.

When you’re about to make a purchase, do you struggle to make a decision whether to pay with cash vs. credit?

If you do, no worries. Deciding between the two is actually pretty tricky business. Both have their perks, and both have their downfalls.

However, consistently making the right choice at checkout when it comes to cash vs. credit can save you some serious bucks in the long run actually.

But, how do you know which one to choose?

If you need some schooling on the benefits of each, read this article. We delve into everything you know so you can make the right decision every time.

When to Say No To Credit:

If the Fee Isn’t the Best Available Deal

Looking to rack up some rewards points on your credit card?

Thinking that using your card to pay your mortgage, health insurance premium, or other recurring bills is the best way to do so?

Well, think again.

First of all, many services don’t even allow credit card payments. And. even if they do, they’ll typically smack you with a huge fee that cancels out the value of the reward points.

 

If You Haven’t Negotiated With Your Creditor

Rack up any huge expenses lately?

Well, before you bust out the credit card, you’ll want to contact the company’s billing department. There’s a chance that they offer a payment plan or that you can get some of the balance reduced.

It’s best to look into all of your options before dropping a huge amount on your credit card.

If You Are in the Process of Obtaining a Mortgage

A big change in your credit activity is a huge red flag to mortgage underwriters.

From the time you apply for a loan to the time it closes, it’s best not to drop any major charges on your credit card that could affect your credit score in any way. A hit to your credit score could potentially disqualify you for the loan, which obviously is the last thing you want.

Use the mortgage process as a time to take a break from the credit card and from any major shopping sprees.

If You Want Something You Can’t Afford

We’d like to think this one would seem obvious, but seeing as the average credit card debt in Australia is $3,083, maybe it isn’t.

No matter how tempting it is to purchase this luxury item, if you don’t need it, don’t buy it.

We realize this is most definitely easier said than done. So, if you struggle to put down the plastic, consider implementing the envelope system.

With the envelope system, you take out a certain portion of your paycheck out and divide it into envelopes based on your spending needs. For example, one envelope can be for rent, the other for groceries, the other for gas, etc. You are allowed to transfer money between the envelopes, but once you run out, that’s it for the month.

If You Already Have a Balance

Again, to some people, this is an obvious one. But to others, not so much.

Piling on more debt to an already existing balance is a bad idea. This is exactly what leads to a never-ending cycle of debt.

Instead, make it a habit of paying off your credit card immediately after making a purchase. This will help ensure that you get an awesome credit score.

If you already have a balance that needs paying off, then cash definitely wins int cash vs. credit card debate.

When to Say Yes to Credit:

If You Want Additional Warranty Protection

If you’re about to make a major purchase and want some extra protection, then your credit card is the way to go.

Almost all card issuers offer purchase protection as well as an extended warranty for the purchase made with the card.

For example, Visa and MasterCard both double the warranty. MasterCard even ensures the purchase against theft or damage for 90 days.

If You Want Stronger Fraud Protection

Every one is liable to fraud. And at some point, most people have to deal with a stolen or lost card.

In fact, in just 2015 alone, more than 770,000 Australians were victims of identity theft.

There are a lot of preventative measures you can take to securing your identity. However, in the event someone gets a hold of your information, credit card protection is much stronger than debit.

If a loss is reported after unauthorized use occurs, you are usually only liable for up to $50. With debit cards, you can be held liable for an unlimited amount if you don’t report the fraud in time (usually it’s a 60-day window).

If You Want to Take Advantage of Benefits

Pick a credit card that is co-branded, and you’ll be offered some pretty sweet deals that are hard to pass up on.

For example, if your credit card is co-branded with an airline and you buy your flight with that card, you can often times get a free checked bag.

Hotels tend to get in on this action as well. Many offer special amenities or free upgrades to customers who pay with a partnering credit card.

If You Want To Take Advantage of a Rewards Program

Almost every credit card these days has a rewards program.

Taking advantage of yours can actually save you some serious money. Some offer cash back, while others offer points, allowing you to earn hundreds, maybe even thousands of dollars back each year.

If You Want Security While Traveling

Traveling tends to put you at greater risk for fraud.

Lost cash or a lost debit card is next to impossible to recover anywhere, especially in a foreign country. However, losing your credit card abroad requires the same simple protocol as back home. All you need to do is call your bank to cancel.

Cash Vs. Credit Conclusion

If you never have a problem immediately paying off your credit card, then choosing it over cash will probably be most beneficial to you.

If, however, you tend to succumb to debt easily, it’s best to avoid using your credit card save for emergency situations and special circumstances.

Got any questions about the cash vs. credit decision process? Drop us a comment below!

7 Tricks, Tools and Tidbits for Your Financial Budget

Do you feel like you’re always living paycheck to paycheck? Is your money spread thin? Here are 7 tools you should employ for your financial budget.

Are you running out of money before your monthly bills are paid? Or just scraping buy? Are you ready to take charge of your finances? Want to make today the first day of the rest of your financial life?

Make a Permanent Decision to Take Charge

If you said yes to any of the questions above, congratulate yourself. Seriously, many folks find it easier to avoid dealing with this stuff.

Education is a critical tool. Being proactive will give you a much better chance at future happiness than being reactive.

Now that you have made this important decision, here is how to make your financial budget successful.

Outline Your Financial Budget

The word “budget” unfortunately sounds unpleasant. It sounds like “restriction” or “buzz kill.”

If the words “financial budget” seem scary, think of it as a “spending plan” instead. You decide how much money to spend and in what category, depending on your priorities. Then you get to spend as much as you want to in certain categories, depending on what you decided.

The categories you will mainly need are: (1) Housing (2) Food (3) Transportation (4) Clothing (5) Entertainment and (6) Savings.

Housing includes your rent, mortgage, real estate taxes if they apply, insurance…anything associated with keeping a roof over your head. It would also include what you spend for heat, air-conditioning, water, etc.

Track Your Actual Spending to Create a Realistic Financial Budget

Coming up with a financial budget involves trial and error. It’s one thing to aspire to spend $100/month. But it’s not going to happen if you think you spend $75 when you actually spend $200.

Spend at least a full month writing down everything you spend money on. Whether it was a $1 candy bar purchase, a $50 ticket to a ball game or an $800 unexpected expense that hopefully, you were able to use your emergency cash fund to pay, write it down.

There is power in the pen. Writing down what you purchase can be a powerful tool (as old-fashioned as it may sound). For under a dollar, you can purchase a small notebook that is reserved for this purpose.

The most important thing is to track, however. So if you prefer, you can certainly create your budget with the help of an online tool.

Consider what is most important to you by allocating a percentage to each of your categories. Your percentages should add up to 100%.

If your income fluctuates, you can allocate percentages of your income instead of fixed dollar amounts.

You will also need to incorporate any debt repayment into your budget instead of hoping it will somehow get paid otherwise.

Decide How to Incorporate Debt Obligations Into Your Financial Budget

How much debt do you have? Are there some debts that you are delinquent on? Are there any you are in default on?

Your first step in dealing with debt might be to contact creditors to negotiate a monthly payment amount. Debts that get ignored tend to snowball into much larger financial problems.

You will need to have a strategy for dealing with unsecured debt. “Unsecured” means any debt that is not attached to a tangible item that can be repossessed if you don’t pay.

Once you have listed and totaled your debts, use a debt calculator to give you an idea of how long it will take you to be free from unsecured debt if you continue making minimum monthly payments.

Include at least the minimum monthly payment on all unsecured accounts in your financial budget. Then add as much extra as you can to pay on the smallest debt. Once the smallest debt is paid off apply that bill’s payment to the next smallest debt.

From this point forward it is important to borrow responsibly.

Execute Your Financial Budget

You have tracked, analyzed and planned. Here is where the rubber meets the road.

You will need to have a system for maintaining your financial budget. There are multiple ways of doing this and the best one is the one that you will use.

One way is to maintain multiple bank accounts with different names for different purposes. A main “operating” account acts as a clearinghouse into which you would deposit all earnings. You then automatically transfer whatever percentage or fixed amount of your earnings into the accounts designated for a particular purpose. This is especially useful when making sure you have or are maintaining the emergency cash account.

You can also install a smartphone app that enables you to set up your financial budget and savings goals, as well as connecting to your bank accounts. Choose an app that lets you know what you can spend each month, week and day based on your goals.

You will always want to know how much you have left to spend to stay on track and be alerted when you are off-track.

Consider Ways of Pocketing Some Extra Money

With all of this spending and debt talk, we can’t overlook the issue of income. In some cases, you can slash spending, but it is not going to help the financial budget if there is simply not enough income.

Consider whether you could ask your employer for a raise (after documenting some achievements you have made since your last).

Is there a class you could take to become certified in a new skill that would entitle you to a pay raise? Is there a hobby you enjoy that you could convert into a money-making venture?

There is definitely more to life than work. But perhaps if you are in a particularly tight bind you could pick up a temporary part-time job.

Don’t Let Money Stress You Out

Having a financial budget should be empowering and not limiting. Your financial budget should serve you, and not the other way around.

Having negative feelings around money does not serve your financial well-being. Respect money, appreciate it, and don’t let it see you sweat.

If you find that you have chronic problems with debt and keeping money in your pocket, it may be time to seek help from a counselor about what negative programming you are holding about money.

Please share your favorite tools for your financial budget below!

 

 

 

 

 

 

 

 

 

 

Financial Habits to Break Today if You Have Bad Credit

We all have the best of intentions when it comes to our credit.

If you notice that everyone else seems to have their credit under control, while you’re spiraling deeper, you aren’t alone. Nearly a third of Americans have bad credit. How do you keep getting into this?

The answer might lie in your financial habits. In the past, we gave you finance skills you should have. But what about the financial habits you shouldn’t?

Here are ten financial habits you should break if you want to improve your credit.

Not keeping track of charges

It’s easy to lose track of what you charge to your credit card. $5 here, $10 there. It seems so harmless, in the moment.

But at the deadline, these charges add up. And if you’re trying to budget, you’ll be caught by surprise when your bill winds up being much higher than you expected. It will be harder to pay on time if you don’t know what to expect.

Keep track of every expense you have — whether it’s $50 or $5. That way, you’ll know exactly how much you have left to pay when the time comes.

Ignoring due dates

This may seem obvious. But it’s something that 1 in 4 Americans has trouble with.

Don’t let due dates catch you off-guard. Failing to pay them on time is one of the quickest ways to mess up your credit score, so it’s important to know when they’re coming up.

Staying on top of your due dates is one of the first steps you can take in improving your credit.

Spending recklessly

There are many tricks that stores will use to get you to spend. That’s their job, after all. But you can’t fall for them.

Be incredibly wary of any feeling in your gut that tells you that a sale is a “once in a lifetime opportunity.” There will always be more sales. No matter how much you feel like you need the thing they’re selling, you should not buy it unless you have the money to spend.

You’re allowed to indulge occasionally, of course. Just make sure you think it through, and avoid spending recklessly.

Not preparing for disaster

Even when you have your budget under control, it’s easy for things to spiral. A car crash or an unexpected doctor’s appointment can be all it takes to set you back to square one.

You need to start setting aside savings if you want to keep on top of your budget. Even $10 a month will add up if you keep at it for long enough.

That way, when disaster strikes, you’ll be prepared. Even if the worst happens, you won’t have to worry about your finances.

Thinking short term

It’s easy to look at something you want to buy, and think, “I deserve this.” And that’s probably true. But how useful will it be to you in the long term?

You need to be honest with yourself about the value of your possessions. That $60 blouse might make you really happy when you take it home, but what if you throw it out two months later after never wearing it? Is that television worth it if you stop watching it after a week?

The novelty of new items will often wear off quicker than you think. Focusing on the long term is a good way to remember that.

Not writing down your budget

It’s easy to imagine that we’ll be able to remember things on our own. But that’s often not true.

It’s been proven that we remember things better when we write them down. And, more importantly, writing things down makes it harder to cheat. If you keep your budget in your head, you’ll be able to tell yourself, “Well, what I really meant was …”

Avoid this by writing down a clear, concise budget.

Keeping things to yourself

Trying to improve your financial habits is no easy task. And like most difficult things, it’s even harder to do alone.

People are 33% more likely to reach their goals when they have someone holding them accountable. So pick a partner or a friend to hold weekly meetings with to discuss your project! You can even pick someone else with bad credit who you can help.

Turning this into a partnership helps take some of the weight off of your shoulders.

Relying on loans

Obviously, sometimes loans are unavoidable. When you’re going to college, or under similar circumstances, you might have to.

But taking them out frivolously — or as anything other than an absolute necessity — can do more harm than good. A lot of them have fees that are easy to overlook. Plus, you don’t know what your financial situation will be when it comes time to pay them.

Try to use loans only when absolutely necessary, and do your best to pay them off as promptly as possible.

Not understanding your credit

This can be one of the financial habits that you don’t even realize you have.

When your credit card bill comes each month, what do you do? Do you simply pay it off? Or do you take the time to look over it and see how your spending affects your credit each cycle?

If you aren’t doing the latter, now is the time to start. Your credit score is never going to improve unless you know exactly what’s making it bad in the first place.

Giving up

You might feel like you’re trapped in a cycle. You constantly tell yourself that you’re going to get better, but the next time your bill rolls around, it just gets worse.

Saving money is hard. And if we don’t admit that to ourselves, it’s easy to give up.

This is one of those financial habits that requires a change of mindset, not just action. You need to stop thinking that this is going to be easy. It isn’t easy for everyone else, even though it looks that way. It’s not going to be easy for you, either, but that doesn’t mean you should stop trying.

And if you ever need motivation when it comes to breaking bad financial habits, you can always come to us.

10 Personal Finance Skills You Should Be Using

Do you ever find yourself running out of cash before your next payday?

If you do, then you probably aren’t good in managing your personal finances. If it’s any consolation, you are not alone.

The simple truth is many people in Australia, the United States, and several other countries live paycheck to paycheck, often with little to no money in their rainy day and retirement funds.

But, the reason many people survive on paychecks isn’t because the money they’re making is genuinely insufficient. The real reason is they lack solid personal finance skills.

In this post, we’re sharing the 10 personal finance skills you need to take control of your personal finances and attain financial freedom.

Let’s get into it.

1. Budgeting

To be a prudent money manager, you need a budget.

Regardless of the amount of money you pull in every month, you need to draw up a spending plan.  Without one, you risk blowing your money on things that aren’t essential to you.

To create a budget, start by calculating how much money remains in your account after taxes and other mandatory deductions.

Next, calculate your monthly expenses. This includes the cost of housing, utility services such as water, cable television, electricity, food and commuting. Also, include luxury expenses (anything that you can do without), such as dinner outs and movie tickets.

After adding up your total expenses, assess how they stack up against your disposable income. Do they exceed income? Close match?

Set a monthly spending target, and start cutting down your expenses until you hit the target. That’s how you end up with a budget that works for you!

2. Financial-Service Hunting

What influenced you into opening a personal finance account with your current bank?

If you chose the bank simply because it has a ‘cool factor’ or someone close to you recommended it, you could have made the wrong choice.

Knowing how to hunt for the best products in the finance services market is one of the most important personal finance skills to have. You must evaluate interest rates, transaction charges, maintenance fees and other costs before settling on a bank.

3. Negotiation

Negotiation doubles up as a business and personal finance skill.

While being savvy with your own money is crucial to financial freedom, the amount of income you earn is a major player.

Here’s how negotiation comes in.

Whether you are looking for a job, getting a promotion or hunting for a business contract, you must know how to negotiate for better financial terms.

A salary raise or a bigger business contract will no doubt improve your personal disposable income. This means you can start saving more money for retirement!

4. Personal Investment

No one wants to rely on employment until you can’t physically work anymore. In fact, about 70 percent of millennials want to start a small business.

Making personal investments is the best way to get out of employment and take charge of your financial destiny.

However, investing your personal money is a lot riskier. Get it wrong and you risk spiraling into debt. Therefore, you must have the skills to study various investment markets and pick out excellent opportunities before making a move.

5. Debt Management

Even though debt is undesirable, sometimes it’s the only way to make it through the month. Thousands of people also borrow to start a business.

Whether you borrow from family or friends, payday loan providers or banks, it’s essential to master the skill of debt management.

Don’t borrow more than you need, hunt for the lowest interest rates, consolidate credit card debts when you can, and pay off your loans on time to avoid unnecessary charges.

6. Going Frugal

Being frugal means being economical with your money.

Sure, you don’t have to adopt a frugal lifestyle for good, but foregoing the little (or big) things that make your life fun and worthwhile can help you save money.

If you are movie addict, for instance, you don’t have to buy a movie ticket every weekend. You can surely do with one or two in a month. Can’t you?

Instead of going to the mall over the weekend, how about spending time in the park where you have little chance of making an impulse purchase?

7. Reading Financial Statements

Banks, credit card companies and other financial institutions that handle your money usually issue various financial statements.

Knowing how to read and interpret these financial statements is also one of the most useful personal finance skills.

You will be able to track how money flows in and out of your account and spot any suspicious transactions in the statements.

8. Building Your Credit Score

As we said, sometimes you may need to secure a loan for various reasons.

However, getting approved for a loan is not that easy. You must prove to prospective lenders that you’re able to repay the loan with interest in a specified timeframe.

If you’ve a poor credit history, lenders, especially banks, will turn you down. But having a good credit score improves your chances.

Therefore, you must know how to build your score. Pay bills on time, clear existing loans, and clear credit card balances.

9. Getting Insured

Life is uncertain.

Your employer could go out of business in a few years, your own business could sink or the economy could crash.

Insurance protects you from such uncertainties. With good personal finance skills, you will easily know which type of insurance cover you need most.

If you’re uncertain about your job, then you need unemployment insurance cover. Life, medical and disability insurance policies are also essential.

10. Estate Planning

What happens to your wealth after you are gone?

Estate planning is the process of arranging how your physical assets (like houses) and financial assets (like money in a retirement fund) will be managed.

Even though conversations around estate planning are often difficult, planning ahead is the best way to protect your hard-earned assets and safeguard the future of your loved ones.

Closing Thoughts on Personal Finance Skills

Personal finance skills are a must-have if you want to lead a successful and fulfilling life.

To this end, we hope that you’ve learned about the skills you need to make the out of your own money. Apply them in your everyday life.

And if you need a cash advance to take care of short-term needs as you make adjustments to your personal finances, talk to us today.

In Debt? Here’s How to Take Control of Your Credit Cards

Being in debt sucks, plain and simple. Australia alone has a substantially shocking margin of household debt at nearly 125.2%.

Your credit, financial opportunities, and general financial standing take a big hit when you fall into debt – and it is very easy to do.

But being in debt doesn’t have to define you, and you can actually get out of debt pretty quickly.

We put together a guide to getting out of debt quickly and properly as well as how to manage your debt without being completely broke.

Ready for some handy knowledge and to get in control of your debt? Check out our awesome guide!

Being In Debt And How To Get Control

This guide can help you prevent, fix, and manage your debt.

Prevention Is Key

If you need cash quickly and are considering payday loans or credit cards, consider some alternatives before you potential get in debt.

There are a ton of things you can do to get cash quickly without the need for a lender:

Sell your stuff on Craigslist, eBay, or DePop. Look through your closet, garage, attic, and other places in your home for the junk you never use anymore and purge your life of garbage while simultaneously making money.

Pick up a side gig like driving for Uber, freelance writing or blogging, or housekeeping.

Use your savings. The key to this is to replenish your savings as quickly as you can after taking out the money. Saving is hard, but there are

Saving is hard, but there are a ton of resources out there that are ready to help you learn how to save.

Before you try to get approved for a loan or credit card, try these steps first.

Recognize When Things Are Getting Bad

It can often be very clear when your debt has spiraled out of control, but other times it can sneak up on you – and other people will notice before you do.

When credit card or loan debt gets to be overwhelming, it is easy to go straight to denial.

Do you ignore calls from unknown numbers, ignore your bills, and avoid conversations about finances with your partner or family? You might be in denial about the gravity of your debt.

Ignoring debt may seem to work for a while, but it isn’t going anywhere. Your accounts will rack up interest and late payment fees.

You need to snap out of that denial in order to give your debt attention it needs to disappear.

Just as well, if you have a super vague payoff deadline, you may be setting yourself up for disaster too.

Saying you will pay off your debts “eventually” is on any calendar. Make a solid but reasonable deadline for your debts to be paid off and work towards that goal.

Take Action With Little Steps First

Get control first and foremost by looking at all of your balance statements. Make a list of each individual debt you have plus their due dates, minimum payments, and their individual current interest rates.

Pay all of those minimum payments now.

Organize all of your debts starting with the one with the biggest interest rate. With any spare money you might have, try to pay addition money towards your highest interest debt.

As you earn income, reserve a significant amount of your paycheck to paying more and more of that highest interest loan off until the balance goes to zero.

Then, move on to the next ones. This will take a lot of time depending on how many debts you have, but it will work.

In addition to keeping track of your debts, also keep track of your incomes and expenses. Deduct how much money you have to spare monthly and dedicate that money to paying off your debts.

Balance Transfers

Credit card balance transfers are credit accounts with 0% APRs (usually introductory) that are used to reduce the burden of other credit card interest rates. With the balance from this low-interest card, you can pay off your more aggressive debts and combine them into one low-interest account.

Balance transfers can absolutely be helpful. However, it is easy to get stuck in the cycle of using balance transfer after balance transfer to avoid the later higher APR.

This also can apply to payday loans. Payday loans can be a fantastic solution to very short-term issues, but one can get stuck in the cycle of rollovers and high-interest rates if they are not careful.

Remember that moving a balance isn’t the same as getting rid of it. Use this formula for balance transfer card repayment:

Total balance transfer balance / # of months until the 0% introductory APR expires

The result of this calculation is your new monthly payment. If you stick to these payments, you’ll be debt free in no time without having to pay an aggressive APR on top of the debt.

Save, Save, Save!

Saving your money is how you will be able to pay off that debt. There are many ways to save money out there, and you should do your best to making a savings plan that works for you.

On top of saving money to use for debt repayments, try to save additional money on top of that to bulk up your savings account.

It doesn’t have to be a lot of money at all. Start with a couple dollars here and there, then gradually add more money to your savings account and do not spend that money on anything.

The security net of having a savings count and nurturing it until it can hold a substantial amount of money will make you feel safer and proud of yourself as well. When an emergency comes around, you will be both debt-free and prepared.

When an emergency comes around, you will be both debt-free and prepared. No need for a loan or a credit card.

Get Out Of Debt The Right Way

Was our guide to being in debt and getting out quickly and properly helpful to you?

Tell us your thoughts, along with your favorite tips for being in debt and getting out quickly, in the comments below!

DIY Credit Repair: You Can Fix Your Credit

Your credit score could either be a stepping stool to a whole new world or it could be a ball and chain. If you’re in the latter category, you are probably hoping for an alchemist to show up and transform your ball and chain into gold for you. Although some loans don’t require a perfect credit score, you never know when you are going to need a good score.

But credit repair isn’t a magical process. You can’t just wave a wand and make it all go away. But you can do something about it. The good news is that your ball and chain doesn’t have to be forever.

There are some simple and fairly reliable steps you can take to fix your credit score.

1. Credit Repair: Put Your Bills On Autopay

It used to be that you had to physically mail or drop off a check to pay your bills. In the age of the internet, this is no longer the case. In fact, over 60% of Australians use online banking. And you should too! It’s the best way to do some credit repair.

Most online banking is a free addition to a checking account. And some banks will give you a checking account for free.

Once you have an online banking account, you can quickly set up automatic payments to most of your bills.

If your bank doesn’t allow online bill pay, most credit cards will allow you to enter a bank account number and set up automatic payments over time. Just simply input your banking information, tell the company how much you want to pay each month and you will never forget to pay your credit card again.

Now, some credit card companies will only allow you to either pay the full amount or the minimum payment each month. In that case, set up the minimum payment and try to pay off the rest as soon as you can.

Only paying the minimum payment will cause you to rack up more debt as it doesn’t cover interest fees.

2. Get Your Free Credit Report

Not knowing your finances inside and out is like being blind and alone in a dark maze. You really don’t want to be in that situation because you will never know what’s coming at you or what’s around the next corner.

Don’t go into credit repair blind. Get your free credit report. You’re entitled to it for free once a year.

What’s inside your credit file that will help you with credit repair? Everything a loan officer looks at before making a decision on your loan acceptance.

The file includes things like your identity information. Your full name, gender, date of birth, address, employment history and driver’s license.

It also includes your public record. Things like court decisions, bankruptcies, writs and summons, and debt agreements.

Your monthly repayment history is in the file. This is the section that examines your credit accounts. Accounts such as your credit cards, loans, mortgages and other credit. This might also include how many times your credit has been accessed.

You want to limit how many times companies or rental companies or loan officers access your credit. Too many credit inquiries can damage your credit.

Lastly, you will find defaults in your credit file. These are debts overdue by more than 60 days.

3. Know Your Negative Impacts

You really need to know what might be negatively impacting your score before you can begin credit repair. There are several things that can impact your credit score in a negative way.

As we pointed out above, multiple credit inquiries will affect your credit score negatively. The people who check your credit score could include car dealers, rental companies, loan companies and anybody who might offer something on lease. Be careful with anything that requires a downpayment. Make sure you ask if they are checking your credit score.

Defaults are probably the second highest impact on your credit report. Loan officers want to know you are going to pay them back. They want their money. They aren’t going to give you money if they know you aren’t good to pay them back over time. If you are late on a payment for over sixty days, this tells lenders that you are irresponsible.

Court judgments

While maybe not as important as other aspects, court judgments will negatively impact your credit score. This is an area of credit you can actually repair. Sometimes records can get mixed up. Court judgments could end up on your report when you were never even in court. This is why it’s imperative you check your own credit once a year.

Missed payments on your credit accounts are probably the most damaging of all. This is where you should focus your credit repair. It’s why we started this article out with a way to set up auto payments on your credit accounts and bills.

Missed payments on your credit accounts stay on your file for two whole years. This is why you want to ensure that no more than one payment is missed per account. But you really should ensure you miss no payments.

4. Improve Everything!

Time is the great healer. But you can start now with credit repair. There are several things you can do now that you have the knowledge.

Broker A Deal

If you are struggling with paying your credit cards or loans, talk with your lender. Let them know you are struggling. They could negotiate a repayment plan that fits within your budget. And this will ensure you do not default again on payments.

Consolidate

One reason people have a hard time repaying debts: they can’t keep track of them all. This is absolutely understandable. And it’s absolutely fixable. You can consolidate your loans into one account. Talk with your bank and credit card companies. It might cost an initial fee, but it will make it easier to remember to pay.

Report Inconsistencies

As we pointed out above, your credit file may have some errors. This is probably the easiest way to repair credit. Contact the credit reporting bureau to have certain false listings removed.

Conclusion:

You now have the tools you need to repair your credit and get your life back on track. Go out and make the best of it.

 

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