Author / Kevin

Money Management

Are You Eating Away At Your Budget?

Managing a budget can be difficult.  Little expenses can quickly get in the way of meeting your financial goals.  One of the biggest and easiest ways to eat away at your budget is by eating out.  It can be difficult to find motivation to cook dinner after a long day at work, but if you really want financial freedom, reduce your spending on this expensive non essential.

Let’s See How it Adds Up

A thousand dollars is simply one hundred $10 purchases.  That sounds like a lot.  However, if you eat out three meals a day at $10 each, you will have spent almost a thousand dollars in just one month.  If you eat at more expensive restaurants or are trying to feed a family, this expensive habit can add up even more quickly.

It’s surprising to see just how quickly it all adds up.  By eating out, you could easily destroy your savings goals and your financial security in just a matter of months.  On the other hand, if you change your eating out habits and start spending less, you could end up with a substantial amount of extra money each month.

Look At Other Options

Everyone needs to eat.  This doesn’t mean that you should stop spending money on food or never enjoy your favorite restaurant.  There are other solutions.  Look at your budget at determine how much you are willing to spend eating out each month.  Set a goal and then stick to it.  This can mean that you will need to make other plans for your meals.

If you know that you will be tried after a long day at work, plan ahead.  This will help you to avoid impulsive trips to the local fast food joint.  Prepare easy to reheat meals on the weekend so that you won’t need to spend hours cooking after work.  Pack your lunch several days a week.  It can work well to get it ready the night before just in case you are running late in the morning.  Stock your cupboards with easy meal options so that you can always find a snack in a hurry.  If you need to go out, find some inexpensive choices at your favorite restaurant.

While there are many ways to find extra money and save, eating at home more often is one of the easiest.  With a few simple changes, you can have several hundred dollars extra each month to devote to your financial goals.

Money Management

Five Money Saving Tips for the 21st Century

We’ve all heard how important it is to build up personal savings, but so few people actually have any type of substantial savings.  If saving money is as easy as most financial experts purport it be, why aren’t more people successful at doing so?  Quite simply, it’s because saving money requires personal discipline.  Practicing personal discipline in the 21st century is incredibly difficult due to our commercialized culture.

Everywhere you look there is an invitation to spend money.  Turn on the television and what do you see?  Commercials galore.  Go to a movie and before the previews start there are commercials.  Some restaurants have even started selling advertising space in their menus.  Our current multimedia and digital age gives the average advertiser far more exposure to the consumer than in decades past.  As consumers we are flooded with marketing, selling us the idea that we need extra things to make us happy – even if we cannot truly afford such things.

The following are five tips that can help anyone break the cycle of spending and begin the habit of saving.

1. Pay yourself first

If you’ve heard this tip before but ignored it, it’s time to start paying attention.  We’ve all seen what happens on payday.  When payday rolls around the first thing most people do is immediately spend.

Bills need to be paid, grocery shopping needs to be done, and recreation needs to be had.  When the paycheck is almost all used up, whatever pathetic amount is left over is sometimes allocated towards savings but there are no guarantees.  More often than not some other unforeseen expense creeps up and drains the leftovers.

It’s time to face an important reality: If you don’t pay yourself first, chances are you won’t do it later.

 

It’s recommended that you put away ten percent of every paycheck.  That might sound like a lot at first but the sooner you start doing it the less impact your budget will feel.  Look for places in your monthly budget/expenses where you can trim some fat to make up the difference of what you’ll lose by allocating ten percent to savings.

If ten percent sounds like a wildly unreasonable amount, start with five percent and work your way up to ten.  If you want to walk on the wild side, try 15 or 20 percent!

2. Put your savings out of sight

Ever heard the saying “Out of sight, out of mind?”  Well that rings especially true with money.  A $20 bill sitting on the kitchen table isn’t going to last very long in any house.  Twenty dollars sitting in an interest bearing savings account could likely survive a whole year if you forgot about it.

One of the tricks to saving money is to stash your savings in a place that makes it difficult to make a withdrawal.  Here are a few ideas for making your savings more elusive:

  • Don’t use your regular bank for a savings account.  If at all possible, use another bank – one out of the way, or even out of state.
  • Set up reoccurring automatic withdrawals from your regular checking account into your savings account.  For example, ask your bank to withdrawal $25 every Friday and deposit it into your savings account.
  • Check with your employer to see if they will allow you to split your direct deposit.  Many employers can take a percentage of your paycheck and deposit it into a different account than your normal checking account.
  • Don’t use a checking account.  You want to make it difficult for yourself to make withdrawals from your savings so it’s important not to have a debit card or paper checks connected to the account.

3. Use less plastic and more paper

Debit and credit cards are ultra convenient.  They make transactions so much easier.  However, sometimes they can cause us to lose track of how much we’ve been spending.  In this era it’s pretty difficult to not use any type of debit or credit card, but there are some expenses where it’s not necessary.

As an experiment, try putting yourself on a cash budget for certain line items in your budget where you’d like to cut back.  One example is food.  It’s very easy to spend a lot of money eating out or grocery shopping.  Set your monthly food budget and at the beginning of the month withdrawal the full amount in cash.

Put the cash in an envelope and put it in a safe place in your house.  For the entire month, only use money from the envelope for food-related purchases.  When the money runs out, that’s it.  No pulling money from elsewhere.  You’ll be amazed at how clever you can be when you absolutely must stick to a budget.

4. Keep the change

Have you ever gone on a change hunt in your home?  Change is lurking in all sorts of interesting places.  That change may seem insignificant, but it quickly adds up.  Make it a practice to regularly spend an hour or so gathering the spare change around the house.  Check under sofa cushions, in the laundry room, in pants pockets and all around.

There are many services that will cash in your change for dollar bills.  Coinstar.com is one of them.  Coinstar has kiosks in many grocery stores where you can simply dump all your change while the machine counts it and spits out a receipt you then redeem at the checkout stand for cash.  Doesn’t get much easier than that.  Take that cash and immediately deposit it into your savings account!

Another tip for saving change is to establish a change/money jar somewhere in your home.  Every time you find spare change or dollar bills, drop them in the jar.  Empty your pockets at the end of every day.  Whatever you do, don’t take money out of the jar and spend it!

5. Ignore unexpected income

We’ve all been blessed with some unexpected income.  It might be some birthday money.  It might be a bonus from work.  It might be a lonely $100 bill you found on your morning jog.  The reality is our first inclination when we come across extra money is to spend it.

Start a new habit and put any new and unexpected income directly into savings.  If you really think about it, it’s money you didn’t expect in the first place so you’ll never miss it when it’s gone!

These are just a few easy (and not so easy) tips to get you started down the path of true financial freedom.  Stop living paycheck to paycheck and embrace the lifestyle of saving.  The peace of mind you get by stacking up savings is worth the temporary sacrifice.

What ways do you use to save money?

photo credit: paul (dex)

 

Business

Who Really Needs a Bookkeeper?

This is one of the questions that tends to be asked almost like clockwork when it comes to new business owners setting up operations for the first time. In the early stages in particular, bookkeeping services can seem somewhat on the superfluous side of things for no reason other than the fact that it can essentially be tackled in-house. And of course, in-house solutions immediately curry favour in the minds of smaller business owners as a means by which to not only retain full control, but save a packet in the process.

Does anyone really need to be thinking of SEPA transfer duties this early on?

Well, the aim of any business of any size is of course to master its particular trade and build a strong, prosperous future. This in turn means that time is perhaps the most valuable resource of all and thus the more time spent wrestling with painful admin tasks like accounting, the less time there is to focus on what the business does best…or at least what it will one day do best.

So, is a bookkeeper the answer?

Checklist to Consider

All circumstances of course differ, but to offer some of the most obvious examples at least, chances are a bookkeeper would be of huge value to you and your business if:

  • You’re already finding yourself guessing or totally clueless in terms of how much money is coming in and how much is going out – records should be 100% flawless.

  • Invoices and receipts have amassed in boxes and filing cabinets in such large and disorganised numbers that you have no idea what most are for and would need about a week to find a specific one.

  • Income is suffering from time to time due to delays in issuing and chasing up invoices and payments owed.

  • Paperwork is mounting up and becoming a headache you’re putting off every day.

  • You’re finding yourself spending more time on paperwork than actually moving the business forward.

  • Numbers aren’t your thing and see you tearing your hair out.

  • You look at paperwork like the root of all evil and despise hitting the books.

Any combination of any of the above scenarios really should indicate that things are not going forward as well as they could be and that a little outside help wouldn’t hurt.

Bookkeeper Benefits

So how can a bookkeeper help? Again, service packages will vary, but the staple benefits include:

  • Massive time saving and freed-up resources.

  • Flawless accuracy.

  • Faster chasing up of all payments owed to stabilising income/outgoings.

  • Reports on performance to enable modifications to be made in the business plan.

  • Legal assistance when and where needed.

  • Peace of mind knowing all tax matters are being handled professionally.

  • Extensive cost-savings compared to buying equipment and running an in-house accounting effort.

Making the Choice

There are very few, if any businesses that couldn’t benefit from at least considering and talking to a pro book keeper– it is simply a case of finding the right one for the job. Just use a little common sense to find an individual or firm with experience in the relevant business area, the right kind of guarantees to ensure a quality partnership and as much positive feedback and accreditation as possible.

Farooq Patel is a self-employed finance professional who holds a number of high-profile contracts he manages from his office in Swindon. He is married with two children and recently returned to the UK after living and working for seven years in the US. 

Travel

A Few Money-Saving Tips While Traveling

Money-saving during traveling remains an art and while veteran travelers are still learning it, it’s the newbie’s who should be more serious about learning from scratch. Be it about growing the patience to research thoroughly on the best flight/train ticket deals or about finding the cheapest but decent accommodation- there’s probably a lot of work up your sleeve. Traveling, no matter, how refreshing or fulfilling an experience it is, remains a pricey proposition if you’re not learning about a few tricks to save up those precious bucks. Read on to acquaint yourself with  few effective tips to save money while traveling and be well on course to secure a cheap but memorable traveling experience

Research 

The most oft-repeated but the most important cheap travel tip would be to time your visit duly. Touring during the off-season remains a financially wise traveling decision as transport, accommodation, food and other costs remain dramatically low during that period. Flight tickets, for instance, vary with seasons, months, days and even with the time of travel. Weekend flights are expected to cost you more than weekday flights. Hotel accommodations might follow similar rules as well. A good advice would be to sign up for relevant travel alert emails that would help you zero in on the best travel, or at least the flight deals. Here’s more on ways of saving up on flights and hotels:

Money saving tips

Tips to save Money on Flights 

  • Opt for stopovers or indirect flights
  • Pre-book airport parking a few days in advance
  • Fly from an alternative airport ( not from the nearest one) if you think that it might turn out cheaper to fly with it even with the train or the bus ticket involved 

 

Tips to save Money on Hotels 

Try out private rooms rather than expensive hotels- there are a lot of websites that let locals to rent out their spare rooms, sofas or the whole apartments that turn out much cheaper than the expensive chain hotels. Home swaps can also act as great alternatives to the pricey (hotel) accommodation. 

Avail Cheap Overseas Spending Card 

Try and grab a super cheap overseas spending card. Most of the cards add a 3% cost to the exchange rates received by the banks themselves. Availing a specialist card would help you avoid this expense, as it doesn’t include the additional cost. Thus, you can get one of these cards and make sure that you’re paying back in full to avoid paying interest. 

Luggage Shipping Service 

Learn about the luggage shipping service. There are these thriving luggage delivery companies like carrymyluggage.com and Send My Bag that would transport your luggage to the concerned destination and back at much lower rates than what would have been charged by the airline authorities. It would be better if you act a little prudently while packing. If you really think that a pullover here or a pair of high heels there can be left behind, don’t think twice before excluding them. Baggage fees make up for a significant portion of the budget. So saving up substantially here remains important. 

Debt Management

The Basics of Debt Management

Debt management is a buzzword that commonly gets thrown around but what is it really and what does it entail? More importantly, what can you expect to see in a debt management plan and how can you use this to your advantage? Likewise, where do you get proper debt management help if you are at a loss as to how to proceed from your current situation? 

Here are a few basics on debt management that are designed to help you understand about securing the right debt management help to help you erase your financial problems. 

Debt management is essentially a series of concepts and ideas implemented to arrest and reverse the continuing growth of personal debt. While debt is something that happens to everyone all the time, it becomes a particularly critical issue during these times when the economy is weak and jobs are hard to come back. In essence, debt management encompasses the following areas: 

  • Debt management plan. This is the actual step-by-step strategy that one executes to arrest debt growth. It should include payment schemes for multiple debts, including but not limited to prioritizing which ones should be paid off immediately, which ones can be re-negotiated to a lower rate, and which ones ca be deferred without incurring extra late payment fees from the creditors.
  • Debt management consolidation. This is one of the more infamous strategies towards debt settlement because it can be wrongly used and in turn, can backfire. Debt consolidation simple means securing a loan that is then used to settle all your debts so instead of looking at multiple payables, you are left with just one. The disadvantage with this approach is if its done only to temporarily resolve debt problems without addressing the root cause of the issue: poor spending habits. Debt consolidation should only be done once and as a last resort to debt problems and not on multiple occasions becoming a force of habit that worsens your debt situation. 

To get debt management help, there are plenty of organizations that offer debt management advice as well as an overview of the concepts and strategies that one can implement to minimize debt problems. There are also plenty of internet resource materials that explain these concepts in detail. Further, if you want to personally talk to a debt management professional, you can approach banks and financial consultation institutions to provide personal counseling for a fee. These are all geared towards making you learn the concepts of debt management and practice it in your everyday life. 

So check out these resources and improve your grasp of debt management concepts so you can use it to your full advantage in resolving your financial dilemma and reversing your fortune towards financial freedom.