The credit card trap.

The credit card trap is what I have come to call any credit card company looking for a new client. I have found myself in large debt because of credit cards, and have watched many friends and family fall into the same trap that I had. Credit cards have become the highest source of where people become high in debt. That isn’t a great thought for anyone who wants a credit card.

Some credit cards have started getting you to pre pay part of the credit cards balance before you even get the credit card. That is great because if you don’t have the money you can’t get the card. That is one thing that I like about credit cards now. But there is so much that is attached to credit cards that people don’t look into when they apply for that credit.

One trap that I have found to be common recently is the “no annual fees”. That is one of the favorite things that I have laughed about. With the no annual fees you find that if you had annual fees the interest rate would be lower. But as things are not read into that far and not very many people have accounting backgrounds I would expect that things just slide by.

Another trap is the introduction rate that creditors are offering to possible clients. By the time that the card has been used, responsibly or not, the interest rate has tripled or more. Paying out more money towards creditors. That introduction rate will not be the only rate that you get.

If the card is used responsibly, then what happens is that the credit limit increases and increases. The more you are allowed to use the more likely you are to drive up the balance and have to pay out more interest. That is the trap that is most likely to have people cringing.

If you do have the opportunity to look into the credit cards before you get them make sure that you specify the highest limit that you will allow yourself. The more that you use the card the more likely you’ll pay more to. There are transaction fees that they don’t count towards your balance until after you have paid minimum payments.

The best way that I can suggest is to stay away from the “easy” money and use cash. If you can’t afford it don’t buy it. The more that you want something the more popular that it is the more likely you are to use the credit card to get what you want without thinking about how long and at what price you are going to be paying the creditor.

Where Did All Our Money Go?

When it’s payday time and we realize that we don’t have enough money to pay for our expenses, we normally blame the rising prices of commodities and the monthly income that we think are not always commensurate to our hardwork.

But, the truth is, we should all find ways to cut corners and reduce expenses to make sure that we live comfortably and well.

Record, record, record!

For a month, record all your expenses in a small notebook, everything, from gasoline expenses, transportation expenses, meals in the office, toll tickets, cups of coffee during breaktime, expenses for the school projects of your kids, and a lot of expenses which you thought are negligible. This way, you can track down where exactly your money is going.

Create a Budget

It is always said that in creating a budget, you should pay yourself first. But for me, I believe, you should give back to God first part of what He has given to you, after which, you can then save some part of your income for yourself.

I use the envelope method in budgeting. I allocate all the expenses and put each of them in their own envelopes. This system is effective although sometimes some envelopes are short, but I know that if I stick to my budget, I will be able to fill this up from other expenses that I am able to save from.

Ways to Save Money

  • Don’t bring your car to the office everyday. With the rising cost of gasoline, it’s really a good idea to just commute. Aside from saving on gasoline expenses, you will also save on parking fee. Of course, there are exemptions to this, like, when the weather is really bad, it’s better to bring a car than to get soaked and waddle your way through floods.
  • Bring a packed lunch to the office. Eating out is very expensive. Save this for a once a month bonding with your office-mates.
  • Reduce your dining out expenses. When my family goes to the Mall, we eat our lunch first at home, this way, we reduce our entertainment expenses. A family of five these days spend a bit when eating in a restaurant or fast food joint.
  • Make a list of the things that you need to buy before going to the grocery. Better yet, ask your husband to do the grocery. Weird? According to some studies, men are fast shoppers and only buy the things they had set out to buy, while women, on the other hand, take a longer time in groceries or shopping malls and practically stop at every aisle. This is the reason why women end up with more products in their cart instead of just leaving with the items on their grocery list. I’ve proven this in the case of my husband. When I ask him to do the grocery, he really strictly follow what’s on our list, and his expenses are always within the budget.
  • Identify and reduce non-essential expenses. I really love to read books. So, to reduce expenses here, I got a membership in the Book Club in our office. For a very minimal fee  a year, I get to read as much number of books as I can. But what I cannot sacrifice is my monthly expenses on Good Housekeeping and Working Mom magazines. I feel justified in having these extra expenses because I really get a lot of ideas and inspirations from these magazines.
  • There are many unnecessary expenses that total to a fairly large amount of money. For example, in our office, we have a coffee boy who brings us coffee and snacks during break-time in the morning and afternoon. But since this is a special service to staff, the cost is also slightly more expensive than when we go to the cafeteria by ourselves. So, what I do is, I just buy my biscuits and chocolate drink from the supermarket and just bring my own snacks in the office.

    The key to reducing our expenses is really within us. Everything really depends on self-discipline. This is what’s important and this is what we can very much apply in our everyday struggle to stick to our family budget.

Reduce Your Expenses for Maximum Savings

Save at the Grocery Store

There are many ways to save money at the grocery store. You should always get the sales circulars and make a list before going to the store. That way, you will be less likely to purchase an item on impulse. Use generic brand items or coupons on those items you just have to have. The best way to reduce your grocery expenses is by combining coupons with sales for maximum savings.

Save on Heat and Electricity

The best ways to save on heat and electricity bills is to use less of it. Make sure your home is well insulated and you do extra by using heavy draperies or window shades, keeping doors to unused rooms closed, and filling all cracks around windows and doors.

Besides insulating to reduce your heat expense, you should be sure to keep your temperature low in the winter and higher in the warm months. A sweater is a lot cheaper than running your thermostat higher all season.

Also, be sure to turn off lights, appliances, and other electronic devices when not in use. And only use them when necessary.

Save on Phone, TV, and Internet

You can reduce your expenses a lot on phone, television, and internet services. Make sure that you are only getting the service that you need. If you never watch the 500 channels on the cable network, you should look into reducing your plan. DSL internet is a lot cheaper than modem speeds, and dial up, though annoying, is cheaper still. Make sure you are not paying unnecessary phone charges.

Save on Entertainment

If you are looking to get maximum savings from your expense reduction techniques, this is the category to do it in. Entertainment is, after all, not necessary to pay for at all. You can always go out less, go to less expensive establishments, or share costs with a group of friends. Purchasing video games, movies, and books can all be done very inexpensively on the internet or at clearance sales.

Save on Clothing

You can easily reduce your clothing expenses by not shopping for brand names and maintaining a flexible wardrobe. Many pieces of clothing can be used in both warm and cool months. Buy neutral colored clothing and just change less expensive accessories to update your wardrobe.

If you can reduce your expenses in all of the above categories, you should be able to maximize your savings easily. Whether you are saving for potential emergencies, a new car, vacation, or home, the end result will be much better than the slight inconveniences experienced when reducing your expenses for maximum savings.

Credit Cards – The Real Cost

They can be a life saver or a curse depending on how you use them. They do cost you money however if you let them get out of control and don’t manage them effectively; you could find yourself in trouble and in debt.

Self control and understanding that you are responsible for the debt that you incur is the first thing that you need to be aware of and that you will have to repay any money owing. The effect this has on your long term goals could be astonishing. It affects your credit rating and your credit rating has an effect on your lifestyle. It has an impact on your eligibility to get a loan to purchase a house or a car or any other major item. Store cards also show up on this report so if you think you can move to another location and start again, you need to know that that isn’t always the case and you may have to face the music at some later stage in your life.

On the other side of having a credit card, it can get through a rough financial patch and tide you over until the finances improve. It can get you that bargain now and as long you are aware of what you can afford to pay, it can be a lifeline. It is good to have a credit card when you don’t want to be carrying cash or when you are traveling overseas.

When applying for a card, shop around as there are all sorts of benefits that you could get such as low or no interest for a period of time, loyalty rewards and free travel insurance etc. Do the groundwork and find one that suits your needs. Make it work for you because it your money that you are spending.

How to stick to a saving plan

The easiest way to stick to a savings plan is to do it automatically.

  1. Have a percentage or set amount (say $100) automatically deducted (and invested) from your check before you even receive it.
  2. Set up an investment account (like a mutual) that keeps your money reasonably liquid but requires you to sign papers at the bank and then a few days to liquidate. This should curb spontaneous spending of large amounts of money.
  3. Put an upper limit on your bank account (say $10,000) and anything over that limit move to an investment account.
  4. Sign up to have bills automatically withdrawn from your account to avoid late charges.
  5. Have the bank automatically withdraw a set amount every month from your account and deposit it into your investment account.

It’s easiest to save when you don’t have to handle the money. By having someone else handle your money you won’t be tempted to spend it on the way to the bank.

Pro’s and Con’s of Having a Credit Card

PRO’s

  1. It’s easier to keep track of what you spend every month if you receive one statement with all your expenditures on it. ie: credit card statement
  2. You have a large amount of money available to you instantly for those expenses that require a few extra days to get funding in place for.
  3. You have emergency money available should you suddenly need it.
  4. If you use your credit card for all your purchases then you accumulate points or credits – or whatever promotion your card offers – faster. This could result in cash back, or reduced air travel fees etc.
  5. Credit cards allow for easier internet shopping.
  6. Credit cards often insure your purchase against breakage or theft for a limited period of time.
  7. Credit card companies monitor your spending and alerts you if your spending pattern suddenly changes.

CON’S

  1. Vigilance and control are a must to prevent over spending.
  2. High interest rates on unpaid balances ever month.
  3. If your card is lost or stolen then you could incur huge expenses.
  4. Credit card companies could suddenly ‘stop’ your card if your spending pattern changes.
  5. You sometimes have to show your ID when using your credit card.

It is up to the individual to exercise control over spending no matter how they plan to pay for their purchases. Credit cards with high spending limits are like any other means of credit. They are no different than carrying a debit card and maintaining a high balance in the bank – or a low balance and living off of a credit line.

Suddenly acquiring enormous wealth

If an enormous wealth was suddenly acquired then there would be many benefits, however, there would also be many disadvantages. I intend to give a brief overview of these advantages and disadvantages.

The most obvious benefit would be a new level of financial freedom; this would lead to the ability to make yourself and your family comfortable and to treat any friends or charities. You would be able to purchase most things you crave and a few you don’t!

The problems would also be just as powerful. How would you know who your real friends were? How would you know what you really do want? These would be questions that would creep up after a short period of time. Who really wants to be given everything on a plate with no need to work? There would be no aims or motivation to move up in there lives either at work or at home and it would be difficult to keep focused on every day activities that shape our personalities.

Saving Lots Of Money For Retirement is Not So Smart

I don’t believe retirement savings plans like rrsp’s for instance are for everyone. As a matter of fact, putting tons of money away for your retirement simply does not make much sense to me at all. Especially once the government knows you have the money tucked away(like in a registered plan or even a bank account). Your pension will be adjusted and most likely that will be a downward adjustment. It is much better in many cases not to have this source of income.

It makes as much sense as working and hoarding your money all your life so you can leave it for your kids when you are gone. What kind of thinking is that? If every one had that mentality, then it begs the question, “who the heck eventually gets to spend the money?”

SPEND AND ENJOY WHILE YOU CAN:

My feeling is, if you work hard all your life, you should be able to play hard all your life. Why would I want to work hard year after year and never take time to smell the roses? I believe in enjoying myself now while I am healthy and able to get full enjoyment and value for my hard earned dollar.

DON’T GAMBLE ON GOOD HEALTH:

There is no guarantee that when you retire at 55 or 60 or 65 or whatever age you decide on, that you will be healthy enough to enjoy your golden years to the fullest. I for one would be pretty upset if I worked for 40 years, banking every cent and saving so I had hundreds of thousands of dollars in the bank only to end up with some indsidious illness a year or so after I retire. No way!

THANKS FOR THE MEMORIES:

I’ll probably retire when I’m 65. I mean why not? The company pays me to take 7 weeks holidays every year. They pay all medical and dental. I might as well let them take care of all that for as long as possible. In the mean time, I make good use of my 7 weeks per year. some people plan an amazing cruise for their retirement years. So, why wait? I’m most likely working for 8 more years and I’ve already been on 12 of them. With more on the way. Or maybe they plan to try a fling at Las Vegas in those golden years. I’ve already done that 6 times. I’ve also taken the time to visit the places I was really interested in seeing. Like pretty well every Caribbean Island. A stay in Cuba. Club Med many times. Hawaii a couple of times. Switzerland. New York, Bermuda, Miamia, New Orleans and Boston.

The one thing savers have that I don’t, is money in the bank. I’ve chosen to spend mine as I go. I will however be sure to be debt free and own my own home when I retire. I’ll have a pretty good company pension and with the travel bug pretty well non-existent, won’t need a lot of extra “fun” money. As long as I have the memories of the things of done, that’s good enough for me. I won’t feel cheated. Especially if I become ill and face an early death.

TRAVELING IS NOT SO EASY:

Travelling these days is a challenge. Airports are a nightmare. Security measures all over the world have changed and make flying a pain in the rear. Cruises are becoming so popular that there are line-ups at every turn. Walking down Las Vegas Boulevard is like a Manhattan sidewalk on a Monday morning. Travelling really is for the strong and fit. Older people get tired out much easier and soon find they would much rather be back home. So much for saving for fancy holidays. I’ve been on cruises when there have been over 100 people in wheelchairs. This is what they saved for? I just don’t get it.

RETIRE AND ENJOY THE CHEAPER THRILLS:

Maybe my idea is flawed and everyone else is right, but I think its smart to save some things to do for the years when you do retire and have lots of time on your hands. For instance, I would love how to learn how to fly fish. Not only fish, but to make my own flys and try them out down at the river. However, I’ve decided to leave that until I retire. Now there’s a hobby that won’t cost a small fortune. Like say for instance, the cost of a fancy cruise. Of maybe I’ll finally take up golf. Or volunteer somewhere. Or go for long walks by the river. Or sit in the park and watch the kids play. You know. All the things that are there for us to enjoy. Yet, don’t cost a lot and fill in the time.

How College Students Can Eat On $25 Or Less A Week

With all the other expenses that college students seem to make, it’s hard for many of them to eat a decent meal. Many blow most of their income on food, and spend way more than they should have too because they don’t spend wisely. Either that or they buy the worst foods possible and miss out on important nutrients that they should get every day. If you can spare $25 a week, I can make sure you have some pretty healthy meals that only need a microwave to be made.

First, before we can work on spending money, you’ll need to save yourself some money, and this starts with you using your meal plan. If you eat one meal in the café a day, for seven days, do you realize how much money you could save in a week? Let’s say the average price of a meal in the café is $6. That seems to be the average price of a filling meal at a fast food restaurant. One meal a day, at $6, can save you upwards of $42 a week! That’s more than enough to buy your food and have some left over to carry over for the next week, or go towards more important things. I know the café food isn’t like home, and I know it doesn’t always taste the best, but usually café’s will serve all kinds of food, and most of it is decent enough to eat. One meal a day will not kill you.

Secondly, one of the easiest ways to cut your food bill during a shopping trip is to clip coupons. Coupons aren’t hard to find either. Sunday papers usually carry coupons for the hottest food and personal care items. I know the amounts may seem small when you look at them, but they will save you valuable dollars. If you go into a store with $5 in coupons, you can buy what you want and save $5 on the bill. That $5 can go towards gas money, personal items, or be saved for next week. Besides, it’s likely you can save much more money if you can find a store that will allow you to double coupons. Do this every week, and you can save $20 or more a month. That $20 will turn into $240 or more a year! I’m sure you can think of far better things you’d like to spend your money on than food.

When it comes to shopping, buy easy to fix items that are made for families on the go, most of which can be found in the freezer section of the grocery store. TV dinners are an excellent choice because sometimes, meals can be found for $1 or less. You can stock up on a few of these. A popular food of college students seems to be Ramen noodles simply because they are so cheap. However, don’t eat just plain Ramen noodles. Pick up a bag of grilled chicken strips. Fix your noodles, and then fix a few of the strips. Cut them into smaller pieces, and mix them with the noodles. You’ll have a pretty tasty meal equaling about $2. Using only a few strips a day or less means you’ll have the bag for a pretty long time. Just keep the bag in a freezer and you’ll be able to enjoy the strips for about a month or two.

More and more microwavable foods are becoming available. You can find rice in a pouch that can be placed into the microwave (pouch and all) for only a few minutes. After that, you’ll have a pretty quick, tasty meal, which I’m sure you’d consider better than any café food. Don’t forget that lunch meat and bread can become a valuable meal choice, especially when you need to eat on the run. All of these can be purchased for just under a few dollars and usually keep well for a few weeks.

To ensure you are getting the best deals possible, spend a day looking, not buying a thing. Check out what you’d like to invest in and see what’s worthwhile. Write down the prices and add up how much you’d be spending a week. Don’t forget to take into account how often you think you’ll run out of certain items. Some items you won’t have to buy every week. You’ll mostly have a lot of estimations to do, but it will be worth it in the end if you can decide how much money you’ll need a week to do some shopping. Also take into consideration any other items that may need to be purchased on a shopping trip. I suggest making a budget to help guide you on your shopping decisions.

 

Making a Few $1,000 at Home

Make up to thousands of dollars a day

You may have heard this before. Make up to thousands a day or week or even a month. The time period changes, however the basic idea remains the same. At first glance you most likely will see “make thousands of dollars a month”. Now, lets slow down for a second, and read it again. There is a few words in there you might have missed. Of course I’m referring to the “up to”. Yes it is true you can make thousands of dollars, but the truth is, it’s going to take a long while. Most pay to blog sites have rules where you can only post so much a day, normally about 3 posts, and they only pay around $5 to $10 a post.

The Math

Lets crunch some numbers if you would do the maximum amount of posts and get paid the average $5 per posts on some sites you would make about $450 a month. You may be thinking. “Wow, $450 a month to type and spend time in front of the computer that I normally would” Granted, its really not a bad figure for extra income, but its nothing to quit your day job over, and its certainly not what the advertisement had promised.

Where the $1,000s a day comes in

Frankly, the only person making $1,000 a day is the person you are advertising for. Chalk this up to being another get rich quick scam.

Generating Extra Income:

Being paid to blog is a growing industry, and has some wonderful opportunities out there for you to enjoy.  I’m not going to quote you on what you can make because that’s up to you. They average $5 per post and let you do posts three times a day. How often you post and how many blogs you would like to maintain is up to you.