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Posts Tagged ‘Personal finances’

What Is a Credit Score and Why Is It So Important?

Posted by Dress for Success Midwest Professional Women's Group on November 19, 2010

Why Should I Care About My Credit Score?

You may not care about it, but lenders and even some employers do. The better your credit score, the lower the interest rates will be on any loans or credit cards you decide to apply for. There are a lot of low-cost services online that enable you to check all three-credit scores at any time. I’d recommend using sites with calculators that show an approximate interest rate for a car or home loan based on your score. That way if you need to develop smart debt you are sure to know you’re getting a good deal.

What Affects My Score?

Are you making payments on time? What is your debt-to-income ratio? In other words, how does your income relate to the amount of unsecured debt you own? The length of credit history can also play a big factor. Keep in mind that five years is still considered short. You’ll need credit history for at least a decade before you’re in the ideal area for lenders. The amount of credit you have is a factor, as is when you took out that credit. If it was recent, it could have a negative effect on the score.
A late payment can hurt your score, but if this happens only on rare occasion, then the impact is minimal. Bankruptcies, foreclosures, and judgments can devastate your score.

How Does Mine Look?

The most widely known type of score is a FICO score. FICO is short for Fair Isaac Corporation and is considered by many to be the most accurate. The three major credit-reporting agencies are Equifax, TransUnion and Experian, who also calculate credit scores.

In general this is how lenders tend to view your score:

Excellent credit = 720 and above
Good credit = 660 to 719
Fair credit = 620 to 659
Poor/bad credit = 619 and below

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PWG Financial Tips

Posted by Dress for Success Midwest Professional Women's Group on November 12, 2010

The calendar page turns to November or maybe even December and we realize how few days remain until Christmas. It’s not too late to plan for a merry holiday season paid for with cash!

This week, start by making a list of all the people whom you’d like to bless with a gift this season. Keep it simple. Start with your immediate family and set a dollar limit for each. The dollar limit for each should be the amount that you are comfortable paying in cash. Commit to keep your spending to that amount or less.

The next thing to plan for is holiday gatherings, both Thanksgiving and Christmas. Determine now the amount you can spend on potlucks or travel.

Once you’ve determined those two amounts, total up them up and divide it by the number of paydays you have between now and Christmas. You may need to make adjustments.

Last, make a list of inexpensive or free gifts you could give. Examples are homemade cookies, fudge, chocolate sauce, soup mixes, certificates for nights of babysitting, free car washes, or for a homemade dinner. Look also for packs of items you could divide into several different gifts. There are a multitude of ideas.

By making a plan and sticking to a preset budget, you can have a merry holiday season with no financial regrets later.

 

By Natalie Ames

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Your credit card: 8 things to know

Posted by Dress for Success Midwest Professional Women's Group on September 17, 2010

Suzanne Gellman, MS, JD
Financial Education Specialist

University of Missouri Extension, St. Louis County

Credit cards and credit cards with high limits used to be easy to get, but this is not the case anymore.
Credit card issuers are making changes to reduce their risk and increase profits in an uncertain economic time. Banks and credit card companies are trying to offset financial losses by increasing fees and interest rates on credit cards. A new credit card law seeks to help protect consumers: the Credit Card Accountability, Responsibility and Disclosure (or Credit CARD) Act of 2009.
Most of the provisions go into effect Feb. 22, 2010, but a few start in August 2009. The new law will improve consumer disclosures and end some practices costly to consumers, but it does not cap interest rates and fees. Make sure you know the new rules of the game to help level the playing field.

1. Canceling credit cards. Credit card issuers are “reassessing their risk” and canceling customer credit cards without notice. They must notify you within 30 days of cancellation if the decision was based on your credit report, but they don’t have to notify you before canceling your card. They don’t have to give you notice if cancellation is due to inactivity, late payments or default.

2. Reducing credit limits. Many credit card issuers check your credit
report monthly. If they become concerned about your card usage, ability to pay, or amount of debt you are incurring on their card or other cards or loans, they can reduce your credit limit. If you carry a balance, a reduction in your credit limit can negatively affect your credit score (see fico.com).

3. Different interest rates. If your credit card allows you to get cash advances, you may pay one interest rate for credit purchases and a higher rate for cash advances. In the past, credit card issuers usually credited your payments first to the portion of your balance with the lowest interest rate. Under the new law, if you make more than the required minimum payment, the extra amount will be credited first toward the portion of your balance with the highest interest rate.

4. Interest rate increases. Previously, if consumers were late with one or two payments, or if they made late payments on unrelated accounts (known as universal default), credit card companies could raise interest rates on previous balances. Under the new law, card holders must be at least 60 days late before the higher interest rate can apply to an existing balance. The Credit CARD Act eliminates the practice of universal default for existing balances. Borrowers may still have rates raised on future purchases for late payments on unrelated accounts or “anytime for any reason,” but they must be given 45 days’ notice.

5. Fee changes. Common credit card fees include late fees, over-the-limit fees, balance transfer fees and cash advance fees. Under the new law, consumers must be given 45 days’ notice before major contract changes, such as fees, take effect. Cardholders will no longer be subject to overlimit fees unless they permit the card issuer to approve overlimit transactions, and even then, only one overlimit fee per billing cycle can be applied.

6. Fixed and variable rates. Even if a credit card has a fixed rate, it may not be fixed forever. The Credit CARD Act requires card issuers to give customers 45 days’ notice if they change the interest rate on a fixed rate card. For variable rate credit cards, the issuer may change the interest rate without giving 45 days’ notice if the index to which the rate is tied has changed.

7. Teaser rates. Credit card companies sometimes use an introductory or “teaser” rate to get consumers to open an account. A “teaser” rate is a very low rate limited to a fairly short time. At the end of that time, the rate goes up to a standard rate. The Credit CARD Act requires credit card issuers to offer the introductory rate for at least a year.

8. Extra fees. Credit card companies may no longer charge fees to consumers who pay bills over the phone or online. They can still charge fees for expedited payments.

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10 ideas for entertaining without breaking your budget

Posted by Dress for Success Midwest Professional Women's Group on September 15, 2010

Damaris Karanja, MA
Nutrition & Health Education
Specialist
University of Missouri Extension, St. Louis County

As the holiday season approaches, opportunities to plan entertaining gatherings increase. In these tough economic times, we face the daunting task of keeping our family traditions without breaking our family budget.

The good news is that by being creative and planning carefully, you can still make this season fun and memorable. Saving money does not equate to missing out on all the fun.

A good part of the budget is spent on purchasing food for Thanksgiving and Christmas, Passover or other religious holiday. The following budget-friendly tips can help you to save money and have fun at the same time.

1. Planning comes first. Establish what your budget is and how much you can afford to spend. Design a menu around your budget and what is on special and seasonal at your grocery store. Next, write a list of who will be invited. Your budget will guide you on the number of guests you can comfortably invite.

2. Keep a grocery list. Having a list makes it less likely you’ll make an impulse purchase. It also saves gas for extra trips to the store in case you forget to purchase an item. Stick to your list for added savings, but stay flexible if you encounter a sale.

3. Plan ahead for how to use leftovers. We lose money whenever we toss food because it spoiled. If leftovers go bad because they’re left out too long, we’re putting money into the garbage can. Make planning to avoid tossing foods a priority.

4. Coupons, coupons, coupons! In most cases, grocery stores have great sales on holiday staples such as turkeys and hams. Their goal is to lure you into their stores with the hope you will purchase lots of other products that are not on sale. Use this to your advantage, but only buy items you need. It doesn’t hurt to visit more than one grocery store. Check for online coupons as well. Start with the Web site of the store where you shop or of products you use. Shopping on double or triple coupon days can save you a lot of money. Word of caution: Use coupons only for foods you plan to use, rather than for “extras.”

5. Buy in bulk. If the price is right and the larger size fits your criteria, go for it! Prices can be deceiving, so pay attention to unit prices to ensure you are getting the best deal. Bigger is not always cheaper. Make sure you will use the food while the flavor is still good.

6. Save on store brands. Buy generic and you could save up to 40 percent a year on your grocery bill. In taste tests, most consumers cannot identify the difference between generic and store brands.

7. Shop high and low. Bargains are usually on the top or bottom shelves. The worst deals are at eye level (kids’ eye level if you’re in the cereal aisle).

8. Pay attention at the checkout. Don’t lose out on a great deal because an item scans incorrectly.

9. Ask for help. If you are hosting a holiday gathering, ask for help with meal preparation. This will help relieve some of the financial burden. Contact everyone on your holiday guest list and see who can bring a dish to share. Guests traveling from out of town may not be able to bring perishable items, but they can grab some nonperishables on their way in. Make sure you coordinate who’s bringing what to avoid an overlap.

10. Include a variety of meatless dishes. These are usually cheaper and, as a bonus, generally healthier, too.

Finally, save by serving the poor. How about serving some homemade food or giving a grocery store gift certificate to a family in need? This is the greatest investment you can make for your money during the holiday season.

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Cheap Alternatives for the Must Haves in your Life Pt. 1 of 3

Posted by Dress for Success Midwest Professional Women's Group on September 8, 2010

Admit it. Being frugal isn’t something that you look forward to, after all it means that you’ll be giving up or cutting back on some or all of your favorite activities. What if you found a way to cut back without giving up those things completely? And best of all save money? I’ve compiled a list of [tag]cheap[/tag] alternatives for the must haves in our lives and its pretty good if I do say so myself!

Retail Therapy Shopping

Gather a list of websites that put together the [tag]look for less[/tag], here are a few of my favorites:

Also, try out this list from Fashion Under $100. These stores provide trendy options without breaking the bank:

Tip: Check out annual and semi-annual sales and buy clothes at certain times of the year. For example, after Christmas/New Year’s and at the end of every season many department stores seek to unload their inventory so we benefit because of the deep discounts.

Cable TV

[tag]Apple[/tag]/[tag]iTunes[/tag] is your friend. If you’re always on the go and never at home to watch your favorite episode anyway, dump the Tivo and your cable company then plug in to iTunes. iTunes allows you to watch your favorite television shows online for a small fee, $1.99. For example, Lost, Greys Anatomy and Boston Legal can be bought per episode for $1.99 which equals $24 per month. A benefit for you is that you get to watch them sans commercials and on your own time. Apple also now offers movie rentals from $2.99-$3.99 and HD for a dollar more.

If that doesnt work for you then hang out at a friend’s house, go to your local sports bar, or join a meetup.com group that gets together to hang out and watch popular network shows. This option really appeals to me as I am moving towards not scheduling my life around entertainment in an effort to become more productive.

Tip: Most major network shows can be watched FREE on their respective sites such as ABC, NBC and the like. Youre able to catch up on all the episodes you missed without paying hefty cable access fees.

Automobile

One thing I love about living in a major metropolitan area is that we have so many options for getting around town. Zip Car is an option for those of us who only need a car infrequently which doesnt warrant taking on a car payment, insurance, gas and maintenance which can be costly. Makes sense right? [tag]Zip Car[/tag] rates start at $50 per month for the extra value plan, 9/hr or $66/day for occasional driving.

Here’s a map with their current locations:

This way you’re able to have the convenience of a car without the monetary commitment. The access fees pay for gas, parking and insurance! You can’t beat that!

Other options include biking to work, using public transportation and carpooling. The latter brings to mind an awesome service facilitated by Erideshare.com. Just pull up your state and connect with others [tag]carpooling[/tag] in your area. From the website: “you’ll find this service a good way to commute or travel inexpensively, and maybe even make a few friends.” I think it’s a neat idea, especially if you’re new to town and looking to save money, this is a great option.

Now if you must have a car, then buy it used or another kind of used car becoming popular amongst the frugal, [tag]Beater Car[/tag]s. Why? According to Beater Review, buying new is for suckers! Love that! But with a new car depreciating 20-30% in the first year it makes perfect sense. Check out this review of the Mazda Miata, the ultimate chick car, or not. This saves you extra money on insurance and in most cases won’t have a car payment. Also, check out this article on MSN Money-20 ways you waste money on your car.

Tip: Make the best choice for you and your situation. Everyone doesn’t live hear a major metropolitan city with the benefits of a Zip Car but buying a car that won’t have much out of pocket expense or carpooling may be another option suitable for you.

Eating Out

We’re guilty of this especially with our favorite restaurant and when we hang out in a new part of town. Cutting back in this area takes discipline and maintaining your perspective: saving money. A few alternatives include:

  • [tag]Potluck[/tag] with friends
    • This is a great way to hang out with friends and try out new dishes. If there are leftovers you can bring on the Tupperware to pick up some leftovers for work or dinner the next day.
    • For the uber frugal-I know a couple who potlucks with friends every other weekend. They get together on Sunday and bring large portions of eat least 3 meals. Of course the larger the group the better the selection. They get together eat, laugh, get merry and help each other save money by cooking in bulk and using it for their lunch and dinners during the week. Some get even more creative by turning leftovers into [tag]planned-overs[/tag].
  • Make your favorite restaurant meal at home
    • There was a time when I was obsessed with anything Jack Daniels at T.G.I Fridays. I would go for a long lunch at work and later during the week for happy hour. It got expensive until I got the recipe and made it from scratch at home. Bingo! Money saved

Tip: Check out J.D. over at Get Rich Slowly, he has great tips on how to save while eating out here.

About the Author

Girls Just Wanna Have Funds is for the woman that wants to take charge of her personal finances. We value budgeting, investing, frugality and remain mindful of our spending habits. Move over and make way for women who are in control of their financial destinies and not afraid to say it. We’re armed with a positive net worth and not afraid to flaunt it while breaking financial ceilings one stiletto at a time!

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10 Ways To Make (or find) $1000

Posted by Dress for Success Midwest Professional Women's Group on September 1, 2010

1. Start a pet sitting business. If you live in a large metropolitan city or even the suburbs, pet sitting and boarding can be a good way to earn extra cash.

2. Provide daycare/aftercare for children in your neighborhood. The best way to go about doing this is to research the costs into getting licensed (if necessary), set up costs (turning the basement or sunroom you never use into the child care area) and determine what your competitors are charging then undercut them but a few dollars while adding a bit more with regards to the services you offer.

3. Secret Shopper. EPMSOnline.com is a great way to get started in secret shopping. It’s really easy. You go to their website, sign up, get verified and then sign up for different “shops” in our near your home or workplace. What yo’re doing is providing secret shopping services for apartment companies that utilize EPMS to help them determine if their employees are providing great service. The typical pay out is around $40 and now most if not all of the paperwork is done online.

4. Reduce your budget. Drastically. Eating out. Shopping for unnecessary items. Limit yourself to 2-3 trips to the grocery store, buy what you need not what you want. Several trips = spending more money you don’t have and don’t need to spend. Cut the happy hours. Personal hobby shopping sprees. Review your budget and cut out the WANTS and leave the NEEDS in place. See how much you save. For some this may be less than and for some more than $1000.

5. Start a blog. This may take you at least 6 months to really start seeing a return but I believe it’s well worth it. Your topic? What are you passionate about? What could you talk about for days and not get paid to do so? That’s it! Find a host, pick a blogging platform, choose your theme and get started. For starters, join this challenge: ProBlogger 31 Days to Build a Better Blog | The Secret to Success.

6. Start an Ebay business. Check out sites like Tradekey.com and Alibaba.com for great prices on wholesale items. Make sure it’s something that you research and know a good deal of information about before you start selling. Customers like sellers who can troubleshoot issues as they arise.

7. Sell unwanted/unused furniture. You might be surprised as they add up once you start listing on sites like Craigslist.org, Ebay.com and Backpages.com. If you have furniture in storage or in a basement somewhere, that $1000 might be calling you!

8. End of summer garage sale. Every weekend in September you can have a themed garage sale. One weekend you sell clothes, another furniture, then antiques or random unwanted items. You choose your theme, make sure the items are clean and presented well. Have your neighbors join you in the fun by hosting garage sales along with you to bring out even more people.

9. Start your own business. This may not be in an area you love or are passionate about but do some market research and figure out where the need lies in your area or online. Where does your expertise lie? What do people need but don’t have? Start there.

10. Add yours here. Share with us in the comments area, how to make or find $1000. You can also share on our Facebook page and Retweet ways to find or make an extra $1000.

About the Author

Girls Just Wanna Have Funds is for the woman that wants to take charge of her personal finances. We value budgeting, investing, frugality and remain mindful of our spending habits. Move over and make way for women who are in control of their financial destinies and not afraid to say it. We’re armed with a positive net worth and not afraid to flaunt it while breaking financial ceilings one stiletto at a time!

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My Checklist To Financial Freedom

Posted by Dress for Success Midwest Professional Women's Group on August 27, 2010


I love checklists. Especially when I want to make progress in a particular area but don’t exactly know what steps to take. This is a personal financial checklist that covers all the steps I have taken over last 5-7 years that have helped me move from being a financial mess to having a little bit of an idea of what’s going on.

Some of the listed items are bigger and will take a long time, and some of them are simple tasks that you can accomplish in a day. Some will be relevant to your situation and some will not – that is why it is called “personal” finance – everyone’s situation is unique.

personal financial checklistBut, if you are just starting out and are trying to get yourself into a better position financially, I would suggest spending the next couple months and checking off as many things on this list as possible. If you do that you will be on your way to financial freedom!

This is not a chronological step-by-step process, but like the title suggests it is just a checklist. Some of the items can be done simeultaneously, while others will require another item to be checked off first. Other than the first couple items, they are not listed in any particular order. If you are looking for a step-by-step process, I highly recommend Dave Ramsey’s book The Total Money Makeover.

My Personal Checklist To Financial Freedom

Start giving regularly.

Something. Anything. If you don’t have money, give your time.  Just get the sowing and reaping process started. The Bible says as long as the earth remains there will always be seedtime and harvest and you can’t reap what you don’t sow. So just like a farmer wouldn’t expect crops without planting seed, we too must start sowing in the area that we want to reap.

Make a lifelong promise to yourself to spend less money than you earn.

We could end this checklist right here and it would suffice. Just about everything listed below falls into this category. Spending less than you earn is the key to wealth building, and is the most important lesson when it comes to personal finance. You can do everything else right, but if you spend more money than you earn – you will not be in a good financial position.

This is the simple rule that allows families living on a $40,000/year salary to retire with millions and that causes millionaires to go bankrupt. You have to decide that you will not spend more money than you earn.

Pay off all consumer debts

Proverbs 22:7 says that the borrower is slave to the lender. Having been a slave and a free man in this area, I much prefer being free. A wonderful second benefit is that you have a lot more financial peace and can build wealth faster when you are out of debt.  For paying off debts, I recommend the Debt Snowball Method and these are a few other tools and resources to cut your debt.

Negotiate a better rate with credit card companies

While I was working to pay down my debt, I spent some time on the phone negotiating with my credit card companies to get a better interest rate. It isn’t a guarantee, but I consistently would get off the phone with a better interest rate than when I called.

Create a budget

Creating a budget can be as simple or as difficult as you make it. I love having a budget in place – contrary to what I thought before I tried it, it doesn’t feel like we are in handcuffs, but rather that we are more free to spend money in the areas we want to.

There are lots of budgeting software options and other budgeting tools to help you. Having a budget has helped my marriage, saved us thousands of dollars, and given us so much more peace with our money.

Get the employer match on your 401k

If your employer has a matching program in your 401k or 403b (many of them do) you should try to take advantage of that if at all possible. My former employer had a 100% matching program. So if I put in $500, they put in $500. That is a 100% return on my investment. This is the easiest way to boost your retirement dollars.

Start an emergency fund

This was another thing that we did to give us a lot more peace with our finances. It can be expected that unexpected things will happen. Creating an emergency fund is just proof that you are expecting them. We have since used our emergency fund to save us even more money.

Sell your junk

Way too many of us have way too much stuff. A lot of it would never be missed if we got rid of it. I have sold a lot of stuff on Ebay & Amazon and it helped provide some extra cash to pay down my debt.

Start learning what the Bible says about Money

The Bible really has a lot to say about our money. I wrote an article called 5 Bible Verses about Money that every Christian should know and if that isn’t enough here are 250 Bible Verses about Money.

Create a balance sheet

A balance sheet is a snapshot of your financial position. I like to update it every 6 months and it is a fun and helpful way to gauge your progress.

Create a FLOP

Since I handle the finances in our family, I know a little more about whats going on than Linda does. I created this file, which I call our Financial Life on One Page (FLOP), as something that she could go to if I died prematurely. I combined it with our balance sheet to make it one file that covers all the financial details that she would need if I were gone.

Start giving 10%

Giving 10% of your income to your local church is an important milestone. God was the original giver and we were created by Him to be givers as well. I have witnessed miracles in our life in the area of giving and it also happens to be the only place in the Bible where God says it is okay to test him – See Malachi 3:10.

Organize your bank accounts

I discovered that having more than one checking account allowed us to manage our money much cleaner and with more efficiency. Here is a little on how we organize our bank accounts.

Cut Your Expenses

If you are really trying to save money or get out of debt, you need to thoroughly examine each of your monthly expenses. I wrote about 15 ways to cut expenses which will get you started, but always be asking yourself, “Is _______ really necessary?” or “Can I get ______ cheaper somewhere?”

Simplify your bill paying process

I created a simple system for paying my bills each month. It made my life a lot easier and eliminated a lot of stress. Read more: How to Pay Monthly Bills.

Figure out your true hourly wage

This is a fantastic exercise to help you more accurately know what your time is worth and whether or not that job you have is worth it. Try it here: How much are you really getting paid?

Set Career Goals

Following up on the previous task, is the current job worth it? It is going to help you reach your career goals?  If you continue doing what you are doing, where will you be in 5 years – or 20 years? Are you doing what you love? If not, find someone doing what you want to do, take them out to lunch, and ask them how they did it.

Create A Will

Save your loved ones a headache and just do it. You can do it at LegalZoom.com in less than 30 minutes for $69 and be done with it.

Evaluate your car situation

I am convinced that the one of the biggest things that keeps the middle class Americans in the middle class is their insistence on spending way too much of their income on cars. I used to believe that I would always have a car payment. I was wrong and now I intend to never have a car payment because I will save up cash for whatever car I buy. Watch this video for inspiration. For more read How cars affect your financial freedom.

Start saving for Kid’s college

If you have kids you might want to start saving for their college education. Personally, I wouldn’t do this until I had my debt paid off and had a head start on saving for retirement. Your kids can take a loan out for college, but the only loan you can get for retirement is on a credit card and that seems a bit foolish to me – don’t you think? Some argue that the 529 is the best college saving plan, but the Education Savings Account is a good option as well.

Get Life Insurance

I believe in buying Term Insurance over whole life. There are some cases where there could be an argument for choosing whole life, but generally Term seems to be a better purchase for most people. I recently signed up for my first life insurance policy. I used Zander to get a term life insurance quote and was happy with the process. You can read more in my Zander Term Life Insurance Review.

Pay off your house early

As part of getting out of debt, I want to live without a mortgage as well. Here are 4 ways to pay off your house early. Just imagine your electric bill being the most expensive bill each month. I can’t wait!

Give more than 10%

The more I understand stewardship, the more I realize that every dollar that is in my bank account isn’t mine – it is all God’s. A big part of being a good steward is understanding this and never letting money get a hold on us. I am convinced that the most fulfilled people in the world are those who always looking for ways to give of themselves. Time, energy, or money – it is in our DNA to be givers and like the parable of the talents teaches us, if we are faithful with small amounts we will be entrusted with more.

Any other items you have on your personal financial checklist that should be added?

Article by Bob

Bob enjoys dark chocolate, paying off debt, giving, Foosball, loose-leaf tea, helping people succeed, learning, anything God created, playing guitar, doing things the “long” way, Philippians, excellence, Chick-Fil-A, and making his wife smile. He started ChristianPF in 2007 and has been having a blast ever since. Find him on Facebook & Twitter.

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