Budget Planning

Take 5 Minutes Each Day to Improve Your Finances

One little step each day may be the answer to your finances being in order Are you the type of person who procrastinates about your finances? Do you dread the thought of addressing issues? This is your solution.

Take 5 minutes each day and do something to better for your financial picture These are some examples of how little things can add up Make a call to your credit card company to question a charge that you are unsure of Call and cancel that unwanted service that you are paying for to save you money on your bill Make that appointment to take that class Spend 5 minutes filing your receipts so that you’re able to easily balance your checkbook when the bank statement arrives Open that high interest bank account so that you earn more interest on your money Set up the automatic deduction so that you save money on a regular basis.

I personally called and cancelled a service that I wasn’t using on my phone bill I have registered for a driving class that will lower my auto insurance premium I called a doctor’s office to question a charge instead of just paying it without thought These little steps took me less than 5 minutes each We all can find 5 minutes in our day to address these issues that get put off.

These tasks may seem overwhelming all together But if you do one each day, your financial picture will improve and you will be taking care of your finances and saving money.

Reduce Interruptions, Retake Your Time

This is the second part of streamlining the interruptions in your life.

As of January 1, 2005, the Do Not Call list went in to effect Adding your phone number(s) to the list prohibits companies with who you do NOT have a direct relationship (non-profits and political organizations are exempt) from contacting you for solicitation purposes You can register your telephone number(s) (cell phones too) so that unwanted calls are substantially reduced To register your phone numbers go to www.DoNotCall.gov or call 800-382-1222 Registration takes 31 days to take effect and numbers remain on the list for 5 years, at which time you should re-register So if you registered when the law started, it’s time to re-register.

Also in 2005, the Junk Fax Protection Act was enacted Each fax should include the option for you to remove yourself from that companies fax list, by providing you with a toll free number to call to get your number removed from their list.

Sometimes after all your efforts, you continue to receive unwanted communications, and you have made it clear to the company that you do not wish to be contacted and you have no relationship with them or a sister company and you continue to get contacted, you have the option of reporting the company to their regulatory agency For example, for calls and faxes contact the FTC to file a complaint.

The system is not perfect, but I personally have eliminated most unwanted mail, calls and faxes.

If You Can’t See Your Money, You’ll Spend More

Don’t let your bank profit from overdraft fees! In 2009, it’s estimated that banks earned $20 billion (yes, with a b) in overdraft fees Transactions from ATM machines, debit cards and reoccurring bill payment transactions are mainly responsible for record overdrafts These are invisible money transactions because you can’t see how much you’re spending or how much you have left in your account.

With the new Credit Card Act of 2009, things are changing.You will not be able to automatically overdraw your bank account.Instead, your transaction will be declined.But, that information may come too late to save you from difficulties with creditors and merchants.

The only way to prevent overdrafts is to keep good financial records You must know how much you have available at any given point Better yet – use cash According to studies, people who use actual cash spend 20% less than using other forms of payments That’s because they can see how much money they have left after making a purchase If you choose to use cash, use larger bills The larger the bill, the less likely you are to spend it It is so much easier to spend $5, $10 and $20 It doesn’t seem like much if you spend $20 in 5 different stores But if you have to break a $100 bill, you will have a true understanding of how much you’ve spent.

If you still want to use invisible money, and you aren’t going to track your account, you will have to opt-in with your bank to have your transactions pre-approved Remember that you will still have the fees associated with overdrawing your account.Those fees are typically over $35 for each transaction.

Spend wisely by avoiding fees Avoid fees by keeping good records or by using cash Overdraft fees are a total waste of your hard earned money.

Can you save a year’s worth of income?

Can you save a year’s worth of income for your emergency savings account? Yes, you can. Here are some steps to get started:

Be patient. You won’t save a year’s worth of income in a single year. Work out how long it will take by determining how much you can set aside each month. If it takes 3-5 years, then so be it. Five years will go by whether you save money or not, so you might as well have something to show for it.
Set aside a firm amount from each paycheck. Think of it as a monthly or weekly bill you owe yourself. You can even automate the process so it’s deducted from your paycheck like taxes or insurance.
No take backs. Your savings account deposit should be just as irrevocable as your mortgage payment or utility bills. You can’t call the gas company and ask for your payment back so you can buy a new outfit. Don’t take money out of savings for anything less than a real emergency.
Reduce expenses. There are so many ways to cut back, especially when you know it’s temporary. Do you have cable TV, a gym membership, an expensive stylist? Give those up for a few years. As soon as you have a year’s worth of savings, you can go back to the way things were.

Remember, saving money is not a sacrifice because the money is ultimately yours.