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Travel Tips on a Budget

Even with the price of gas skyrocketing there are still plenty of bargains to be found when travelling in 2012.  During the last few years many people have learned that using the internet is a great way to find great deals, especially at the last minute.  Here are a bunch of excellent tips you can use to save money on your next trip, whether it’s across town or around the globe.

 

Book a Hotel at the last minute.  Sounds crazy, right?  It isn’t so much anymore however as younger travelers have started treating going on a quick vaca like going to the movies.  Hotels have had to adapt to this and there are now plenty of great, last-minute rates all over.  Check Expedia and Priceline before you go and you’ll be surprised at what you find. (Of course don’t do this on major holidays and peak season.)

 

Go where the money isn’t.  Countries that are in deep financial trouble, like Greece, will have much lower prices as they try to attract tourists and their travel money.  It’s slightly risky but you can find some incredible deals.

 

Travel where they are building lots of new hotels.  More hotels mean more competition for your dollar which equals better rates.  In Berlin, Germany that’s what’s happening right now.

 

Go where the big celebration was.  After Mardi Gras, the World Cup, the Olympics, the Superbowl and other huge festivals and major sporting events the price of everything drops as the city where the event was held goes through withdrawal.  Their loss if definitely your gain.

Take the bus or the train, especially once you’ve arrived at your destination.  In Europe you can travel practically anywhere by train and they’re clean, fast and safe.  If you’re keen to see all the major landmarks of a certain state or country take a bus tour.  Either way will save you a ton over flying.

 

Take a vacation close to home and use the car.  Sure gas prices are crazy but, if your destination is within 6 hours drive, you’ll spend much less than on air travel and have a mode of transportation when you’re at your destination.

 

There you go. Plenty of travel tips for 2012.  Now go out and have some fun!

 

How to Create a Simple Budget

If you’re looking to create wealth one of the first things that you’re going to need to do is make a budget and stick to it.  Making the budget isn’t hard at all really and that’s what we’re going to be focusing on in this article.  (Sticking to the budget can be more difficult but having no budget at all is worse.)

The very first thing that you need to do when creating a budget is to determine how much actual income that you are making. This needs to include your income and, if you have one, your spouse’s income too. You will also want to take into account any other sources of income that you have such as interest from savings, dividends from stock options, money that you make on a side job and so forth.

Note down every single income source and how much income it generates and put this information aside. (Do this for a month’s time, not a whole year.)

The next step is a little more difficult; you will now need to track all of your monthly expenses. Start with the easy stuff like car payments, electric and other bills, your mortgage, insurance and taxes.  These expenses  seldom change drastically and thus are easier to factor in.

After you have all that info it’s time to go even further. Take out your checkbook or the latest bank statement and note down ALL your other expenses.  Gasoline, groceries, entertainment, subscriptions to magazines, cable and so forth.  This may take a while do it as best as you can.

Once you have an exhaustive list of all your monthly expenses it’s time for the fun part; adding both the income list and the expense list and subtracting the latter from the former to see where you come out.

If you end up with a positive number you can pat yourself on the back because you’re already spending less than what you make, a cardinal rule in budgeting.

If you end up with a negative number don’t despair. Now that you know where your money is going you can put the steps in place (a budget) to get those totals reversed.

No matter the outcome you now have a solid foundation on which to build your new budget and start building wealth.  If you were already spending less than you make keep up the good work and if you weren’t you now know where you can cut back.  Good luck.

 

 

 

How Overspending can Destroy your Budget

One of the easiest concepts of budgeting and creating financial wealth is that you need to make more than you spend.  That concept, however, is one of the most difficult to follow for many people. The reason is that they don’t know the real factors that encourage their spending and, because of this, they overspend and create debt.

Overspending is not a good habit, to be sure, and so knowing what the factors are that cause this negative habit can be the key to controlling them so that you indeed start spending less than you make and start building wealth.

One of the biggest reasons that people overspend is that they have easy access to credit and credit cards. If, for example, your credit history is good getting and using a new line of credit is incredibly simple. The problem here is that credit cards mask the debt that they create with small monthly payments. It’s like getting free money but not earning it, and the penalty comes when you get in over your head and start having to pay exorbitant credit card fees and overdraft charges.

Having easy access to your cash is also a dangerous proposition and can lead to overspending of an even worse type. It used to be that when you got paid you had to go to the bank, deposit your check, get some cash out and then pay for everything else with checks.  Today with debit cards and direct deposit you can have access to everything you have in the bank from practically anywhere at any time, and this can lead to temptations that few people can handle.

Two others that are a budget killer are temptations (and giving in to them) and spending to feel good. Both of these are seemingly innocuous but can have a hugely detrimental impact on your budget.  For example, going out to the bar with your buds after work and spending $50.00 on your credit card is easy and fun but, when the bill comes due and it’s more than you have, you’re not going to remember the fun you had just the debt that you created.

If you want to stay on budget and create wealth you need to curb overspending at all costs (no pun intended).  It’s the one sure way to stay on track or, if you can’t control it,  get derailed quickly.

 

Using Cash to Stop Overspending and Stay on Your Budget

One of the most forgotten ways to stay on budget is also the easiest; using cash for all of your purchases. It seems simple really and even a little outdated but the fact is that many people have lost sight of the actual worth of their money. With credit and debit cards so easy to get and to use the temptation to overspend can be very high, especially when a lot of credit cards give ‘cash back’ rewards for using them.

The fact is, physically handling money and having to give it to someone for your purchase is much different than swiping a credit or debit card. The problem is that with plastic you don’t see exactly what you’ve spent until the end of the month when you get your statement (unless you check every day which you certainly can do but most don’t).

So as your week goes by you spend on groceries, morning coffee, gasoline, lunch with the gang, drinks after work and maybe a night at the movies.  Doesn’t sound like much and, as you’re purchasing, doesn’t look like much either until that statement comes and your eyes pop out of your head.  Most times the amount you spent is much higher than you thought and may even have put you over the edge as far as your spending limit.

When you use cash, however, you see the effect that your purchases have on your money each and every time that you buy something.  If you start the week with $100.00 you can actually see as it goes to $92.00 and then to $81.00 and then lower and lower as the week progresses. Each time you reach for your wallet or purse you’ll be acutely aware of how much you’ve spent and how much you have left to spend.

One way to see how this can help you is to actually force yourself to do it for a week.  Use your budget (you do have a budget, yes) to determine how much you can spend and take that amount and that amount only with you for a week.

By the end of the week you should know where you stand.  If you made it to Sunday with some cash left good for you.  If not now you know what you need to do to curb your spending.

 

3 Excellent Behaviors you need to Stay on your Budget

When it comes to Budgets most people have few problems making a budget.  The problem comes when it is time to maintain that budget, and that’s where most fail miserably.  Like most things in life a person starts on their budget with great intentions and positive thoughts but, like a diet plan or a gym membership, those plans can sometimes quickly go out the window.

If you don’t want that to happen to you there are three behaviors that you need to possess to stay on track of your budget.  Read below to find out what they are and, if you don’t have them, how to get them.  (You’re on your own with the diet and exercise. Sorry.)

The first is to stay motivated. Like anything in life if there’s no motivation to do it there’s a good chance you’re going to stop.  For example, with a diet your main motivation may be fitting into those size 2 jeans that you’ve had your eye on at the store.  With a budget you can use something similar.  You can, if you like, reward yourself for sticking to the budget by purchasing those jeans or some other new clothing item.

Secondly you need to keep a positive attitude. This can be difficult because you may be sacrificing some of the things that you really love to stay on your budget but, if you let your attitude go south and get all negative, the likelihood of failure increases greatly.  Instead remember why you’re on a budget to begin with, because you want to build wealth and get out of debt, and keep in mind how great it’s going to feel once you have accomplished those goals.

Finally, having realistic expectations is paramount if you want to keep to your budget successfully. When you set your goals too high you will inevitably fail and become disheartened at the whole process. Better to set smaller, shorter, more achievable goals that you can meet and, once you’re able, start setting them higher.

There you have them. 3 behaviors that, if you can get a grip on them, will make staying on budget a lot easier and reaching those goals a lot more possible.  Good luck and stay positive.

 

What Exactly is a Budget?

The word ‘budget’ gets bantered around so much and so often that many people feel they know exactly what it means when in reality they have no clue whatsoever.  Not only that but they think they have a budget when in fact they have nothing of the sort (and no substantial savings or wealth either).

The truth of the matter is that a budget is the cornerstone of any solid financial foundation and without it whatever wealth you’re trying to build will crumble at some point, usually when things go bad somehow in your life. The good news is that regardless of your financial situation putting together a budget isn’t that hard to accomplish once you know what really constitutes one.

So, for the uninitiated, a budget is simply a breakdown of how much money you have coming into your household and a plan for where it will go, either towards paying expenses or towards adding to your wealth.

Think about it this way; if a business didn’t know how much money was coming in and didn’t know how much money was being spent they not only wouldn’t know what their profit margin was but they also wouldn’t stay in business for very long.

It’s the same with your money. If you don’t know where it’s going and you don’t really know how much you have it will be very difficult to successfully build any sort of wealth or savings.

One of the reasons people fear ‘going on a budget’ is that they don’t want to have to cut back on all of the ‘fun’ things that they normally  purchase, like going to the movies, buying new clothes or having a Starbucks latte every morning.

The truth is, however, that if you really know where your money is going you may not have to cut back that much and, when all is said and done, you may find that you don’t need a lot of the things you once thought you did.

But you’ll never know unless you start.  The best advice is to go online and look up some basic budget tools that you can use (most are free) and get going.  The quicker you start the quicker you’ll get on the road to real financial freedom.

 

 

5 Steps to Creating a More Efficient Budget

Many people cringe when they hear that they need to make a ‘budget’. The fact is, a budget simply gives you control and, in time, may surprise you by how much you will be able to save.  It’s also imperative if you want to stay debt free, (or close to it) pay off your existing debts and grow a nice savings account. Read below to see 5 Tips for Budgeting that will help you become a budget master.

Tip 1) Write down your specific, exact earning as thoroughly as you can, even so far as side money, hobby income and overtime.  This needs to be as accurate a reflection of your true income as possible.

Tip 2) Using the same pad and pen, write a complete list of all your monthly fixed expenses. Rent, your mortgage, utilities, credit card payments, car loan, cell phone, etc.  Once you have that done divide every payment into 4 parts to know what you need to take out of each check to pay for the entire month’s bills.

Tip 3) Use a notebook and keep an exacting record or every single expense for 1 month that isn’t a monthly bill.  Even something as trivial as a cup of coffee or a candy bar.  At month’s end sit down with your list and take a look where you could save money, like buying coffee from the local convenience store instead of Starbucks or bringing lunch a few times a week instead of going out.

Tip 4) Once all of those numbers are crunched subtract your expenses from your income.  If the number you end up with is a negative number you need to go back with a sharp knife and trim more until the numbers work.  The last thing you want to do is relay on credit cards to keep you afloat, they’re only for emergencies.

Tip 5) Experts say that you should put 10% of your paycheck aside every week for savings.  If you crunched the numbers and you can’t do that you need to keep shaving off stuff until you can.

If you can handle all of these tasks and make them happen you will not only have a balanced budget but will be well on your way to building a nice nest egg for yourself.

Building a Better Budget

Many people cringe at the thought of creating a budget.   However, a good budget is the foundation for a solid financial future.  No one wants to worry about finding money to pay the bills.  That’s where a budget can help you can organized.

Before you can even think of drafting a budget, you need to know what’s going in and out.  The easiest way to do this is to simply write it down.  Create a document or a spreadsheet and draw a big line down the middle.  Label one column as “Expenses” and the other column as “Income.”

Underneath “Expenses”, list the following items, along with their monthly cost.

First, what do you owe other people?  These items are mandatory because you cannot easily get rid of them.  Your list might include:

  • rent or mortgage payments
  • credit card payments
  • student loan payments
  • car payments

Next, what are your needs?  Needs are required, just like mandatory expenses, but usually you have a bit more flexibility with your needs.  These are typically bills and expenses such as:

  • food and grocery
  • phone, cable and internet
  • transit or gas

Once you have identified where your money must go, you can look at where you would like your money to go.  It’s important to allocate money towards:

  • entertainment and leisure
  • savings and retirement
  • emergencies

Then, underneath the “Income” column, list all your sources of income along with the dollar amount per month. 

Finally, add up the total on each side of the sheet.  If your expenses are less than your income, then you’re doing great!  Take this opportunity to identify areas where you can trim your budget and consider allocating some of the leftover money towards increased savings, retirement, and emergencies.

But if your expenses are greater than your income, you need to make changes.  By seeing what you actually need each month, you can identify weak points in your finances and from there, develop a budget.  You might consider lowering some of your mandatory expenses by moving to a cheaper apartment, consolidating your debt, or seeking a better interest rate.  Perhaps you can trim your needs by cancelling television or internet, cutting back on your cell phone usage, or making more meals at home. 

Do not be discouraged if at first you find that your expenses outnumber your income.  Instead, use it as an opportunity to slowly tweak your finances and improve over time.

Tips for Sticking to Your Budget

Money on Fire

We’ve all heard that making a budget is one of the best ways to curb spending and start saving, but one thing is usually overlooked; how to stay on a budget. The fact is, anyone can say that they have a budget but, if you don’t stick to it, you won’t get anywhere and will basically be in the same place you started, which is in debt with little or no savings.

With that in mind here are a few tools and tips for staying on that budget you set for yourself.

Tip 1- Put money aside each month as if your savings account is another one of your monthly bills. Like your car payment, your electric bill or your mortgage, put a specific amount aside each and every month as if you’ll get a fine if you don’t.

Tip 2 – Cut down on some of your habits.  Smoking, drinking or even buying that Latte at Starbucks every day is eating away at your cash and also your health.  You don’t have to quit completely but cutting back on the expensive (and unhealthy) habits can save you a LOT of money.

Tip 3 – Convert to Cash. If you have a spending problem convert to using cash only and see how quickly your monthly Credit Card bills go down.  Determine the amount you can spend at the beginning of each week and don’t spend more, no matter what.  It’s tough at first, but it works.

Tip 4 – Pay your higher interest Credit Cards first using as much money as you can, and work your way down to the smallest, lowest interest cards.  Do this until all your cards are paid off and then stop using them, or at least use them much more sparingly.

These are some of the best tips for making and sticking to a budget. If you can start with these and get a good grip on them you will be well on your way to sticking to that budget and getting your spending under control.

 

Budgeting 101 – Living Within Your Means

You never want to waste all the hard-earned money that you have earned in your lifetime. Find out how you can save money by investing part of your income and cutting down on your daily expenses. You don’t really want to ask people you know, because you might come off as irresponsible, even though they are probably going through the same thing to. By reading this article, you will find yourself feeling more secure and informed about your financial situation.

Instead of buying a lot of expensive Christmas presents, why not make your own by hand? This will lessen the amount you spend shopping and can help you save a lot of money during the holidays. Creativity can help reduce your costs and increase your overall net worth.

Losing the family home can be devastating. If you are in a tough money situation, try to find a home with a cheaper payment. Foreclosure and eviction are definitely worst-case scenarios. Some people facing foreclosure choose wisely and act first to preempt the eviction by moving.

You can improve your finances dramatically by taking advantage of available discounts. Reconsider your brand loyalties, instead favoring products for which you have coupons. If you usually buy one brand of dish soap and can save money with a coupon on another brand, go with the one that is cheaper.

Switch out your old incandescent bulbs in favor of new, energy-efficient bulbs. Not only will you be lowering your electric bill as a result, but you will also be doing something good for the environment. CFL bulbs should last much longer while using less energy. You will also save a lot more money because you have to buy fewer bulbs over time.

Some debt is actually good for your credit score. Real estate can be considered a good investment. Usually properties, personal and commercial, increase in value and commonly the loan interest is tax deductible. Another example of good debt is a college loan. There are many loans out there for students that have lower interest rates that don’t have to be reimbursed until graduation.

You can automatically have a set amount of money moved to your savings account via your checking account as often as you choose. This is an excellent strategy which helps you to manage your money much better each month. This technique can also be helpful for accruing money for expensive events, such as a wedding.

Pay off the credit card balances that have the highest interest rate first. You may want to pay all debts equally, but those with a higher interest rate should be paid off first to avoid accruing more debt. Keep in mind that credit card rates should increase in the next few years; pay off your accounts as soon as you can.

Contribute to your Individual Retirement Account if that option is available to you. It will allow you to be more financially secure in the future. You can find help with opening an IRA through banks, credit unions, brokerages, or even mutual funds. When contributed to regularly, IRAs can greatly impact your retirement funds.

Be wary of making investment choices based off of past performances alone. Continuous negative results should inspire you to remove your funds and invest it someplace else.

Keeping a written notebook on your daily expenses can be a real eye-opener into where your money is going. If you put it away then you may completely forget about it. A good idea is to get a large whiteboard for use in your office or home as a reminder to keep listing your expenditures. Since the notes will be constantly visible to you, you will stay aware of your fiances.

Once you’ve read this article, you should start understanding the information that’s been provided and soon you will be able to fully take care of your own finances. If the tips did not make sense to you, take a few minutes to reread them and research them to ensure you truly understand them.

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