Income Relief

Budgeting by the Inch

Posted on April 29, 2009
Filed Under How To Save Money | Leave a Comment

starbucks-coffee

Everyone seems to have small indulgences that seem harmless as far as they are concerned, but feel have no effect on their budget.  But ask yourself this - if you could trim a few thousand dollars every year from your budget, would it help solve some financial problems?

You would be amazed at the number of small expenses that add up over a period of time.  Let’s take a look at a few of these expenses:

1.  Do you really have to have your double latte every morning from Starbucks?  Figure it this way.  You spend four dollars a day on gourmet coffee five days a week.  At the end of the year, you have spent $1040 on fancy coffee.  I suggest you go to Speedway, where you can get a decent cup of coffee for a buck.

2.  Do you have a gym membership?  How much do you pay monthly?  And how often are you using that membership?  A typical gym membership will run 60 bucks a month.  No matter how you look at it, that is $720 a year.  Chances are very good that you can find a gym membership for half that price.  Better yet, put up a home gym and save the money spent for a gym membership altogether.

3.  Every time you turn up the air conditioning in your home, you add as much as 10% to your monthly bill.  Energy experts say to keep the heat set at 68° and air-conditioning at 70°.

4.  What about monthly storage fees?  Are you paying $6-$800 a year to store things you don’t use?  Ask yourself this - if it is in storage, and I’m not using it, then why don’t I sell it?  Everybody needs to do a little downsizing.  Clean out the storage unit, sell the stuff on eBay, and rid yourself of one more little hassle.  Do the same in your home.  Even better, donate the items and get yourself a nice little tax deduction at the end of the year.

It is amazing how little items that we take for granted can add up over the period of a year.  Looking at it from the perspective of this article will make you realize that not only are there some things you can live without, but getting rid of them or rethinking your position makes your life a whole lot more enjoyable.

Peace,

Charlie~

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Don’t Hide From Debt

Posted on April 23, 2009
Filed Under Pay Off Debt | Leave a Comment

money

Dealing with debt in tough economic times is hard enough as it is. Trying to hide from your financial problems and avoiding paying your bills is probably the worst thing that you can do.

There is nothing embarrassing about not having enough money to pay your bills and all. The fact of the matter is you may be facing hard economic times, have lost your job or your home is under threat of foreclosure. Many of these factors you can’t control. Hiding from debt and wishing that they would just go away is not going to solve your problems. Even though it may be tempting when you become overwhelmed with your financial situation, all it will do is place you in more financial difficulties.

If you avoid paying your bills, serious consequences will happen. As soon as you miss a payment, your credit score takes a hit. Other credit reporting agencies will be notified, and then your debtors will have the legal right to raise your interest rates. It doesn’t matter if you are paying them on time. You’ll get treated just like the people that miss payments or pay late.

A month or two later, your debt will be given over to a collection agency which will cause your credit rating to drop even lower. If you want to buy a car, get a cell phone contract, apply for a new line of credit or want to refinance your mortgage, you will be out of luck.

Even worse than this, your creditors can take you to court and get a judgment against you. This further damages your credit rating.

These are all good reasons to be mindful of your debt and how you wish to deal with it. The longer you hide from money problems, the worsethis it’ll get.

The best solution for you is to call your creditors immediately. Explain to them the situation and try to work out a lower payment plan. Credit card companies will look at your income and debt load, and if you have a negative cash flow, they are required by law to negotiate with you. Even though it may hurt your credit rating to negotiate lower payments, you can at least not the debt from going to a collection agency, court judgment, foreclosure or repossession.

Right now it is a real struggle to stay on top of things financially. Just about everyone struggles with bills and payments. It makes good sense to do everything you can do to protect your credit rating and ability to get a line of credit. Hiding from your bills will only make matters worse.

Peace,

Charlie~

:lol:

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