Archive for the ‘Build Self-Reliance’ Category
Tips to help you avoid holiday debt
By Firm Hope
The holiday season seems to lure us into overindulgence. Eating too much stuffing or drinking too much eggnog is one thing. Charging too many gifts on your credit cards is another. Although the holiday season may entice you to spend more than you can afford, a little self-discipline can help you keep your purchases to a manageable limit.
Why You Should Limit Your Holiday Card Purchases
Credit cards are only an illusion that can buy more gifts than you actually can afford. Here’s why you should limit your credit cards purchases this holiday season.
- Gifts bought on credit end up costing more. Add in months of finance charges and you’ll ultimately pay more for your gifts than you would if you’d used cash.
- Credit scores fall from high balances. Spending more than 30% of your credit limit will cause your credit score to drop.
- The best laid plans…. Unexpected post-holiday expenses might postpone your credit card payment plan, lengthening your credit card debt.
By sticking to a few spending principles, you can keep your holiday spending to a minimum and avoid paying for holiday gifts until the next holiday season.
How To Avoid Holiday Debt
When you’ve made the decision to keep your credit card purchases within a reasonable limit, here’s how to put it into practice.
- Save up. Spending cash instead of using credit for your holiday purchases allows you to avoid holiday debt all together. If you haven’t started saving, put aside something each paycheck starting now and use that to finance your holiday purchases.
- Set a budget before you shop. Setting a spending limit and sticking to it will keep you from overspending. Be disciplined and don’t go over your budget, no matter what.
- Make a list. Santa makes a list and checks it twice, so should you. Even though you might feel compelled to splurge on everyone in your life, you don’t have to. People appreciate simple and meaningful over expensive and useless.
- Don’t shop for yourself. Avoid the “one for you, one for me” shopping mindset. You’ll end up spending double what you would had you shopped only for the loved ones in your life.
- Ignore “big” sales. More often than not, they’re not really sales at all. Those “Buy 2, Get 1 Half Off” deals only trick you into buying more than you would otherwise. Remember, stick to your list.
- Shop online first. The internet makes it easy to shop around. It also makes it harder to buy on impulse. Since most retailers have inventory on their websites, you can decide exactly what you want to buy before going to the mall.
- Leave your credit cards at home. Without your credit cards, you’ll have a hard time charging them up. If you must use credit for your purchases, pick one credit card and stick to your spending budget.
- Don’t buy if you can’t afford to pay. Keep in mind that when you use credit, you’re borrowing from your future income. You know your finances better than anyone. Only charge what you can afford and you’ll avoid paying on your holiday debt until the next holiday season.
SOURCE: About.com
Topics: Build Self-Reliance, Financial Independence | No Comments »
Follow the Pyramid
By Firm Hope
During these tough economic conditions, many of us are looking for the quick fix for our money problems. We often short cut our nutrition by buying cheaper, non-healthy food items. Now, more than ever, it is important to keep your body healthy to avoid costly medical bills or missed work.
MyPyramid.gov is an excellent resource when looking to improve your diet. The website is maintained by The Center for Nutrition Policy and Promotion, an organization of the U.S. Department of Agriculture, which was established in 1994 to improve the nutrition and well-being of Americans.
Here are a few of their healthy eating tips -
- Buy vegetables that are easy to prepare. Pick up pre-washed bags of salad greens and add baby carrots or grape tomatoes for a salad in minutes. Buy packages of veggies such as baby carrots or celery sticks for quick snacks.
- Use a microwave to quickly “zap” vegetables. White or sweet potatoes can be baked quickly this way.
- Keep a bowl of whole fruit on the table, counter, or in the refrigerator.
- Popcorn, a whole grain, can be a healthy snack with little or no added salt and butter
- Freeze leftover cooked brown rice, bulgur, or barley. Heat and serve it later as a quick side dish
- Consider convenience when shopping. Buy pre-cut packages of fruit (such as melon or pineapple chunks) for a healthy snack in seconds. Choose packaged fruits that do not have added sugars.
- Dried fruits also make a great snack. They are easy to carry and store well. Because they are dried, ¼ cup is equivalent to ½ cup of other fruits.
- Buy fruits that are dried, frozen, and canned (in water or juice) as well as fresh, so that you always have a supply on hand.
- Set a good example for children by eating fruits, vegetables, and whole grains with meals or as snacks.
Topics: Build Self-Reliance, Food and Nutrition | No Comments »
Supplemental Nutrition Assistance Program (SNAP)
By Firm Hope
SNAP helps put food on the table for some 18 million people per month . It provides low-income households with electronic benefits they can use like cash at most grocery stores. SNAP is the cornerstone of the Federal food assistance programs, and provides crucial support to needy households and to those making the transition from welfare to work.
The U.S. Department of Agriculture administers SNAP at the Federal level through its Food and Nutrition Service (FNS). State agencies administer the program at State and local levels, including determination of eligibility and allotments, and distribution of benefits.
Households must meet eligibility requirements and provide information – and verification — about their household circumstances. U.S. citizens and some aliens who are admitted for permanent residency may qualify. The welfare reform act of 1996 ended eligibility for many legal immigrants, though Congress later restored benefits to many children and elderly immigrants, as well as some specific groups. The welfare reform act also placed time limits on benefits for unemployed, able-bodied, childless adults.
Local SNAP offices can provide information about eligibility, and USDA operates a toll-free number (800-221-5689) for people to receive information about SNAP. Most states also have a toll free information/hotline number.
To participate in SNAP:
- Households may have no more than $2,000 in countable resources, such as a bank account ($3,000 if at least one person in the household is age 60 or older, or is disabled). Certain resources are not counted, such as a home and lot. Special rules are used to determine the resource value of vehicles owned by household members.
- The gross monthly income of most households must be 130 percent or less of the Federal poverty guidelines ($1,907 per month for a family of three in most places, effective Oct. 1, 2008 through Sept. 30, 2009). Gross income includes all cash payments to the household, with a few exceptions specified in the law or the program regulations.
- Net monthly income must be 100 percent or less of Federal poverty guidelines ($1,467 per month for a household of three in most places, effective Oct. 1, 2008 through Sept. 30, 2009). Net income is figured by adding all of a household’s gross income, and then taking a number of approved deductions for child care, some shelter costs and other expenses. Households with an elderly or disabled member are subject only to the net income test.
- Most able-bodied adult applicants must meet certain work requirements.
- All household members must provide a Social Security number or apply for one.
Federal poverty guidelines are established by the Office of Management and Budget, and are updated annually by the Department of Health and Human Services.
Get all the details and apply for help by going here.
Topics: Build Self-Reliance, Food and Nutrition | No Comments »
Debt Strategy: What do you pay off first?
By Firm Hope
Paying down your debt can be a great tool to help you stay on track financially, especially when the economy slows. But how do you know which debts you should tackle first? Where do you put your extra money each month so that it will make the most difference? Below we’ve provided a few tips to help you prioritize your debt pay-off strategy.
Priority #1: High-interest-rates
No matter if you have a little or a lot of debt, you’d probably rather spend your money on something besides huge interest fees every month. That’s why most financial experts agree: face those balances with the highest annual percentage rate (APR) first. This tactic can save you money in both the short- and long-term.
The strategy is simple: Pinpoint one high-interest account until it’s paid off, then move onto the debt with the next-highest interest rate. And repeat.
Priority #2: Small balances
Removing a bill or two from the monthly pile can free up at least a few more dollars a month fairly quickly. So if you have several balances that are small, consider paying those off at the same time you are paying down the high-interest-rate accounts.1 Taking care of those easy-to-address, lower balances can give you additional encouragement because you’ll see results right away.
Priority #3: Secured debts
Secured debts are those that are backed by some sort of asset, such as your home or automobile. Unsecured debts, such as credit cards, are not tied to any asset as a basis for the loan. Secured debts tend to be for larger sums of money than unsecured debts, meaning you likely will be paying interest on these types of loans for a longer period of time than smaller, unsecured debt amounts.
That’s why making extra payments on a secured debt like your mortgage has the potential to really work in your favor. By making additional principal payments, you may be able to pay off your loan faster — shaving years off your loan term — and helping you save hundreds or even thousands of dollars on interest payments down the road. Plus, if you pay off your mortgage early, that gives you more money by the end to invest in things like retirement or other savings accounts.
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You CAN get out of debt!
By Firm Hope
If you’re like most Americans, you have debt. If you’re like many Americans, you try not to think about just how much debt you have and what it’s really costing you. If you did think about it, you might not sleep well.
But ignorance never was bliss, and in order to get out from under the burden of debt, you need to face the uncomfortable (and perhaps downright ugly) truth: it may take you 30 years to pay off that credit card balance.
How can this be, you ask? You may have balances totaling less than $5000. Surely this will be paid off in no more than a couple of years. The credit card company wouldn’t let you take so long to repay them, would it?
The answer is: yes, it would. In fact, if you took 30 years to pay off your balance, you would be the ideal customer.
It’s important to understand that the credit card companies don’t allow you to pay back your debt in small amounts out of the kindness of their hearts. This is how they make their money. Paying the minimum payment (usually around 2% of your balance) each month, guarantees that you will be filling the credit card company’s cash coffers with your hard-earned money for many years to come.
You should be absolutely unwilling to pay only the minimum balance on your credit cards each month. If you can’t afford to pay more than the minimum balance, you can’t afford whatever it was you charged to the card in the first place.
Your payments include both interest and principal (the amount you borrowed). When you pay only the minimum payment, most of it goes towards interest, which is why it takes so long to pay off the original debt. You wouldn’t pay $7,000 for an item that is clearly marked with a $2,000 price tag, would you? Yet that is exactly what you’re doing when you buy it using a credit card with an 18% interest rate and then only pay the minimum balance each month. No wonder you feel like you just can’t get ahead!
If you need to buy on credit, at least do it with your eyes wide open. If you’re already in debt, use these tips to get out and get ahead:
- Don’t get any deeper into debt. Save the credit card with the most favorable terms and cut the rest up. Put the one you saved in a safe place (not in your wallet) and use it only for emergencies (not to include a big sale at Macy’s!)
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Pay more than the minimum balance. Much more. - Shop around for cards with low interest rates, but beware of come-ons that offer a low introductory rate and then take a big jump. The Internet makes choosing a credit card easy, but be sure to read ALL the fine print.
- Move balances on cards with high interest rates to cards with lower interest rates.
- Use your savings to pay down debt. It makes no sense to earn 1 to 3% interest on your savings account while paying 12 or 15 or 18% interest on credit cards.
- Come up with a written plan for reducing your debt systematically.
- Add up all the money you spend each month on credit card payments, and think about what you could do with this money if you weren’t paying it to the credit card company.
One of the best methods of systematically paying off your debts is what I refer to as the Credit Crunch. List your debts, including the balance and the interest rate for each one. Each month, pay the minimum balance on all credit cards except the one with the highest interest rate. Pay as much as you possibly can on this card each month until it is paid off. Then start paying as much as you possibly can on the card with the next highest rate, while continuing to pay the minimum balance on the others. Keep doing this until they’re all paid off. This is the only time you should ever pay the minimum balance on any card.
SOURCE: About.com
Topics: Build Self-Reliance, Financial Independence | No Comments »
Beginners Guide to Budgeting
By Firm Hope
Budgeting isn’t a punishment for not being born wealthy. It’s an avenue to know where your money goes and help you reach your financial goals, whether it’s a new home, a comfortable retirement or just making it to your next paycheck. You simply can’t spend more than you make, at least not for long.
What’s going out?
The first step is figuring out where your money goes right now. Use an online worksheet or a plain old notebook to keep track of your spending for a few weeks. Go through your checkbook and credit card statements. Add up the amounts, and you’ll have a good idea about your spending habits.
A few things to consider:
- Common budget categories include housing (rent or mortgage, homeowner dues), recurring bills (cable, utilities, insurance and credit card minimums), food and entertainment.
- Let your categories fit your life. You might have expenses for school-related items (tuition and books), pet care or travel. If your hobby is your passion, make it a category.
- Account for big expenses that occur once or twice a year, such as car insurance.
- Consider making your vehicle its own category. Payments are only the start.
What’s coming in?
When your expenses are tallied, go through your pay stubs and calculate your average monthly income. Don’t forget to include interest income, dividends, bonuses and alimony.
Once you know how much you earn and how much you actually spend, decide where and how much you want to spend. Divide by 12, and voilà – you’ve got a monthly budget. Adjust as necessary until your monthly budget equals your monthly income.
Some things to keep in mind:
- Figure out which of your expenses are wants and which are needs. Actual needs are fairly limited: food, shelter, clothing. Nearly everything else is a want, but even the way we fulfill our needs involves choice.
- Try “The 60% Solution.” Essential spending comes out of the first 60% of your income. The rest includes retirement, emergencies, debt repayment, fun money, etc.
- Prioritize. Fund your retirement first, no matter what. Put enough in your 401(k) to grab the employer match. Then start tackling your debts.
- Don’t forget an emergency fund. This will go a long way to keeping you out of debt should the unexpected happen — and it will. If you don’t have funds now, use your income-tax refund or set up a regular electronic transfer from checking to savings.
Take a little off the edges
Once you’re on your way, keep track — at first weekly, then monthly — of where you’re going off budget and adjust your allocations.
Food, for instance, often goes unchallenged. You might wince at the checkout counter, but you do have to eat. Still, there are ways to cut the food budget without sacrificing quality or quantity.
- Many stores reduce their products based on a 12-week cycle, so notice when something goes on sale, but don’t buy until it hits the rock-bottom price.
- Keep a notebook for a while so you get to know the rock-bottom prices on items that you frequently purchase. Keep track of which products are cheaper store by store.
Food isn’t the only place for savings. Here are some other ideas for keeping your budget on track:
- Bookmark deal-finding Web sites and check them before making any purchase online or any big purchase offline. Check sites such as MyBargainBuddy.com, AbleShoppers and Dealnews for online bargains and coupons
- Review your habits. Do you need the full-on cable package or caller ID? Do you pay full price at a convenience store for items you could buy for less on your weekly grocery shopping trips?
- Some people fritter away cash; others use a debit card as if it had unlimited credit. Whichever you might be, consider converting. A debit card devotee is more likely to think twice about spending cash, especially if you leave your ATM card at home.
- If things still aren’t adding up, look at whether you need to adjust your allocations or change your spending habits.
Building the budget habit
Successful budgeting takes time and persistence, so don’t be discouraged if you don’t hit your monthly goals at first. Here are some ideas to make it easier:
Write it down. If you don’t, you probably won’t stick to it.
- When good fortune comes your way in the form of an “extra” paycheck or a bonus, pay an annual premium, make an additional mortgage payment or use it for seasonal extras, such as summer vacation costs or Christmas presents.
- If you can’t spend less, earn more.
- Get into the habit of thinking ahead. If you know your situation is going to change — a new baby, new winter clothes, a new job — plan for it and try to pay cash.
- Remember, budgeting is the means, not the end. Keep spending “mistakes” in perspective.
- As your income climbs, don’t splurge until you’re sure you’re staying ahead of inflation. A good budget grows with you, so it’s worth re-evaluating your budget every year.
Topics: Build Self-Reliance, Financial Independence | 1 Comment »
Tips for an Effective Job Search
By Firm Hope
Whether you are entering the workforce for the first time, returning to the job market, or seeking advancement, the challenges of a job search are similar. Your goal is to find the position that best meets your needs. You must be qualified and able to sell yourself as the best applicant for the job(s) for which you apply. Here are some tips that can help you in meeting your job search goal.
Know Who You Are
Have a strong sense of who you are. Know your assets and how to market them to employers.
Committed to Lifelong Change
Follow job trends. Take the initiative to maintain cutting edge skills that match changing employer requirements.
Be Computer Literate
Increasing your technical computer skills increases your marketability in the job market. Conduct online job searches. Visit employer Web pages and key job sites such as those listed on our Additional Help and Resources page.
Update Your Resume Often
Customize your resume to reflect the assets you bring to each job. Use key words that can be electronically scanned by potential employers to positions you want. Reflect continuous employment in your skill area. Summer employment should support your field of interest. Volunteer or obtain temporary jobs if you are unemployed. Select a resume format that minimizes any gaps in employment.
Be Your Best
Locating a job is a full time endeavor. Give full attention to all that you do. Errors will knock you out of the running.
Be Organized
Have a written personal plan for vertical and lateral growth opportunities. Know what you must do each day to move closer to your goal. Stay focused.
Expand Your Network
Maintain and continuously strive to broaden your network. If you are working, network inside the company. Join professional groups.
Research Job Trends and Companies
Select targets of opportunity that match your skill areas. Request and study annual reports of select companies. Reflect each company s image in all communications with each company s representatives. Make good use of library resources. Read trade journals and business publications.
Have a Positive Attitude
A pleasant personality is a necessary asset. Your eagerness to adapt and to be a team player is essential. Show that you are flexible. A sense of humor and positive attitude are pluses.
Disclose a Disability Only as Needed
The only reason to disclose a disability is if you require an accommodation for an interview or to perform the essential functions of a particular job. Your resume and cover letter should focus on the abilities you bring to the job, not on your disability.
Be Prepared to Conduct an Effective Interview
Look your best from head to toe. Dress conservatively. Be brief and to the point when answering interview questions. Maintain a demeanor of success and reflect the company image when you respond. Have full confidence in what you bring to the employer and show how your skills meet the company’s specific hiring needs. Ask thoughtful questions about the job and the company. NEVER say anything negative. Follow up immediately with a thank you letter or e-mail transmission.
Remember, push yourself to go the extra mile in your job search and you will find the opportunity you are seeking.
Topics: Build Self-Reliance, Finding a Job | No Comments »
