Emergency Cash 2 :
How To Generate Quick Cash In An Emergency
Emergency Cash 1 and 2 reports will discuss:
1. How to Cope with a Cash Crisis
2. Learning to Cope with a Money Emergency
3. Increase your Cash Flow without Going Further into Debt
4. Start to Build your Emergency Fund
5. Say Good-bye to Credit Cards
6. Painless Ways to Find Money in an Emergency
7. Every Day Ways to Save Money in an Emergency
8. More Creative Ways to Save Money
9. Thrifty Ways to Save Money
10. Even You can Save on a Shoestring
11. Are You Ready to Start a Good Savings Plan?
12. Smart Tips for Living on a Budget
13. Tips to Help you Save
14. 7 Serious Ways to Help you Save
15. More Serious Savings Strategies
16. Make Small Cuts for Huge Savings
17. Emergency Money Strategy while Dealing with Debt, Financial Stress & Family
18. Quick Cash Fixes
19. A Few Timely Lessons in Simple Living
20. How to Save Money on Gas
21. Simpler Solutions for Managing your Money
22. Bring Both Calm AND Savings into your Life
23. Slash your Electric Bill in 6 Easy Steps
24. Good Ways to Find FREE Money
25. Can you Survive/EMERGENCY PREPAREDNESS
7 Serious Ways to Save Money – Not for the Faint of Heart
Do you truly want to save? Take a serious look at how you spend and then change it. Quit smoking those cigars, take in a roommate, park your car—and you’ll save as much as $10,000 a year. It really is just as easy as all that!
Are you finding it harder and harder to blame savings shortfalls on your measly pay check?
Will it surprise you to learn that how much you save has little to do with your income? Well it is very true, in fact. It has more to do with whether you want to save and are willing to adjust your finances to boost your savings.
A recent study by Venti’s and Wise, “Choice, Chance and Wealth Dispersion at Retirement,” found a very wide range in how much people at the same income levels were able to save for retirement. The study pointed out that it wasn’t just the higher income folks who managed to save the most. Indeed, even people in the lowest income groups were able to save more than some of their middle-income peers—by as much as $100,000.
What was their conclusion? Persons with little savings on the eve of retirement have simply chosen not to save as much and spend more over their lifetimes.
The key, then, is simple enough: Spend less than you earn and SAVE MORE.
It is easy to see why some people get into financial trouble.
Some people don’t stop and think that earning money is only one part of the financial health equation. The other critical part is learning how to manage money and save.
A big part of the problem for so many is that people just don’t know enough about their own financial reality. They don’t even know what they earn, they don’t even know what it takes to live comfortably, and they don’t even know their true, discretionary income.”
What can be the solution?
People need to educate themselves. Sit down with your monthly bills and statements and figure out your real income and outgo. Then, decide if you like what you see. If not, create a realistic plan for changing it.
To help with the process, ask yourself these four essential questions:
What’s my true and current financial picture?
How do I choose to live?
Can my current money support this and how do I really want to use my money?
How can I best make use of my money?
Treat managing your money as if you would any other household chore and allot enough time for it each month.
Make note that: Many of the financial tools that have made life more convenient—such as credit cards—can promote very bad financial habits and prolong debt when misused. Credit cards should be used ONLY as the cash-management tool that they are and not as a borrowing tool.
Keep in mind that you are spending tomorrow’s money when you put things on a credit card. You keep locking yourself up and losing your freedom, bit by bit.
The bottom line on financial health is Stop Spending
More Serious Savings Strategies
If you are serious about having a healthy emergency money fund, you might want to curb the consumer in you. This means, instead of spending, saving.
Of course, the number one, best way of saving remains to have a portion of your weekly paycheck automatically deposited to your savings account. If you like the idea of deciding, week by week, how much savings you will deposit, take heart and adapt a serious tip or two. It’s all good if the end result is better and more savings.
Hold that “mother” of all garage sales, once and for all! Do your homework and literally do a house inventory. Journey back, all the way back, into the furthest reach of every closet and decide that, if you have not used it for more than six months, it will have to go. Most people have at least $1,000 worth of garage sale items hidden away in their home. This turns out to be a veritable gold mine for many.
Just how much do you need that nasty, pack-a-day smoking habit? In Washington state, that’s easily $5 a day—or about $1,800 a year—that can go right into your savings. This does not even begin to touch the savings in insurance and health care.
Tame the driving tiger in you. Instead, carpool or use public transportation. This will save you on gas, insurance and maintenance costs—not to mention any money spent on a headache. Using the IRS’s 2002 mileage reimbursement rate of 36.5 cents per mile as a proxy for the cost of commuting, you could save $1,141 a year by driving half the time for 50 weeks of the year (based on a 25-mile roundtrip commute).
For an even more serious approach, consider nixing your car if you live in the city. Some cities are now implementing progressive programs that allow you to have access to a car without the ownership hassles (e.g. “Flexcar” in Seattle, Portland and Washington, D.C.)
Buy items used. The average consumer spends about $1,750 a year on clothing and its upkeep, according to the U.S. Bureau of Labor Statistics’ most recent Consumer Expenditure Survey. You can easily cut that in half by shopping at consignment shops and auctions, though the life of the goods may be a bit less than buying new. To account for that, the annual savings may only amount to 25%, or $437.
Become a homebody. At just over $1,800 a year on average, entertainment spending has a way of eating up the best-planned budgets. Consider the library for books, music and movies. Eat out less often. The average person spends $2,276 a year on eating out. Try cutting your spending in half on both areas for annual savings of more than $1,900.
Cut your housing costs. While a move across the tracks may save some money, moves are expensive. Consider renting out a room in your house. The average housing costs per person in 2004 were just over $13,200. In metropolitan areas such as Seattle, rooms easily go for $400 a month. Figure about $20 of that goes to increases in utility costs, and you’ve still realized annual savings of more than $4,000 before any income taxes.
Cut up every one of your credit cards. Build an emergency fund first to handle most unexpected expenses. This allows you to become your own lending agency. Credit cards can be a cash-flow management tool, but paying only the minimum will keep you in debt for years.
If you’re the average American with at least one credit card, you probably have close to $8,523 in credit card debt, according to industry research group CardWeb.com. At an average APR of 14.4%, it could cost you as much as $1,100 a year in interest rates alone. By simply waiting until you’ve saved enough money to make purchases, you could eliminate those interest payments.
If you’re very ambitious and follow all the above tips, you could be looking at savings of some $12,000 a year. Figuring you can invest that at the historical rate of return of 10%, your savings do start to compound nicely—and rapidly. Instead of the debt, go for the emergency fund and save.
Make Small Cuts for Huge Savings
Tilt the wheel of creating wealth in your favor. Naturally, spending less is one way. However, to be sure to make your money work harder for you—set goals to make certain it happens.
Many have wondered what can be the foolproof way of creating wealth. Is it to buy top paying Internet stocks or to work for a tech startup that offers you valuable stock options? Is the trick to count every penny or is the road to wealth paved with risk? Do you have to be especially smart and well-connected? Alternatively, is becoming wealthy a matter of luck?
The answer is: There is no one, true road to wealth, and all of the above have created wealth for more than just a few notable individuals. Nevertheless, you can put the odds of creating wealth on your side by following a few simple precepts.
1. Spend less than what you earn.
This can be the most overlooked scenario, because many people believe it’s a matter of cutting back on your current standard of living—a strategy that’s far too difficult for many people.
Yes, you can affect your personal balance sheet by spending less money eating out or on entertaining out. Making a pot of coffee at the office instead of buying a $3 espresso will make a small difference in your cash flow. Nevertheless, the biggest difference will be made on the income side of the ledger.
If you wish to get on the right road to saving, stop looking at your budget as a pie that must be cut up into various size pieces. Instead, of trying to figure out how the different pieces will cover your expenses, concentrate on how you will expand the size of the pie. Yes, you could ask your boss for a raise. At the same time, figure out how you can begin to earn more money on the side. Start thinking about how you will sweeten the existing pie.
Think about how you’re spending your time, as well as your money. Perhaps instead of taking the family out this weekend, you could earn an extra $80 by becoming a waiter or bartender. Instead of taking the kids shopping at the mall, you could work as a salesclerk earning some extra cash.
If you don’t wish to work every weekend, think about working every other weekend to start. Instead of paying for a baby sitter while you attend a concert, take care of a few other children on Saturday or Sunday, freeing working parents to do their errands. When it comes your weekend to work, do a switch. This will save you time and money.
Then, instead of spending the extra money you earn from your part-time work, you can invest it so the money can work for you. When you do this, you will learn to appreciate your free time that much more.
2. Make your money work for you.
The ultimate secret to financial success lies in having your money do the work, so you can relax. This requires accumulating enough investment dollars so that the growth and earnings can free you from the need to work even harder. The last thing you will want to be doing is punching a time clock.
Plenty of very wealthy people continue on working simply because they enjoy what they’re doing so much. They also redefine work to include managing their money. For the wealthy, the two can go hand in hand.
Every where you go you will hear, “I never get to the point where I won’t have to return to work because I can’t afford to set money aside today. These people overlook the power of compound interest.
Every worker with earned income is now entitled to open a non-deductible IRA or, even better, a Roth IRA. The maximum $3,000-a-year contribution works out to a cost of $57.69 a week. Any hard working American is capable of achieving this goal.
Moreover, a $3,000 annual investment in a Roth IRA, growing tax-free at the historical average of 10.6% for the stock market, builds to more than $500,000 in 30 years. If you start in your twenties and put $3,000 in that same Roth IRA every year, at 10.6%, you could have a nest egg of nearly, $5.2 million at age 70, according to the MSN Money’s Savings Calculator. Even with an 8% annual return, you’ll end up with $1.9 million.
3. Be sure your money is working for you, instead of against you.
Your money can work very powerfully for you if you make the right decisions and implement a plan of regular investing. At the same time, wrong money decisions will place deep potholes on your road to success.
The classic example is credit-card debt. Consider the example of a person who charges $2,000 on a credit card at 19.8% interest and a $40 annual fee. If you make only the minimum monthly payments (and many people do just that), it will take you 31 years and two months to pay off the balance! Moreover, along the way, you’ll pay an additional $8,202 in finance charges. This is absurd logic!
What could possibly be so important to charge today that it puts you in debt for a period far longer than the object is likely to last? (Sure, a mortgage lasts 30 years, but the interest is deductible and your home should grow in value over that time.) Most things that you want to charge on your card have a far shorter life. For many, they can do entirely without that one purchase.
If you’re already in debt, if you would only double the minimum monthly payment, you could be out of debt in less than three years. Paying down current debt is the smartest way to start on the road to financial freedom.
4. Keep a tight clasp on that wallet
When you take a close look at your paycheck, you’ll notice many deductions before you get to the amount you can cash or put in the bank. Surely, there are deductions for Social Security, federal, and perhaps state income taxes.
It’s money that’s out of your paycheck before you have a chance to even make decisions about it. Money set aside for wealth building should be treated in the exact same way. If your company offers a 401(k) retirement plan, make sure you sign up for the maximum possible contribution. It will be taken out of your paycheck, each pay period, automatically. (And if your company matches all or part of your contribution, failing to sign up is like walking away from free money!)
If you didn’t have a chance for automatic deductions to a company savings plan or even a U.S. Savings Bonds payroll deduction plan, then you’ll have to create your own automatic savings plan. Ask if your company will deposit your paycheck directly into your bank account—or promise yourself to do it the day you receive the check.
Then sign up for an automatic monthly deduction plan with a mutual fund company to create regular deposits into an IRA. You can even set up an automatic deduction for U.S. Savings bonds at its Web site. The whole point to this is to get the money out of your checking account as quickly as possible, before you see it and spend it.
5. Create money savings and investment goals.
Would you like to have $1 million by the age of 40 or 50 or by the time you retire? Sure you would!
Begin by setting your own goals. Never set a goal you can’t control. Your targets can’t depend on your boss giving you a raise; they must be reachable by your own efforts. You might need to invest in yourself by acquiring more education or training so you can qualify for a job that pays more.
You might need to take more risk in your investments or in your lifestyle by taking on a second job that pays commissions instead of a fixed salary. Evaluate the risks involved, and understand that by putting the odds on your side, you can get a larger return.
Emergency Money Strategy while Dealing With Debt, Financial Stress & Family
Financial stress is common among those forced into frugality because of a lost job, divorce, death in the family, or being overcome with debt, etc. This can cause a person to feel insecure, fearful, anxious, angry, and, of course, depressed.
These same feelings are easily the number one cause of poor money management decisions. These poor decisions will lead to unmanageable debt loads, and start a vicious cycle of panic that never seems to end.
When you reach this point, and you find yourself with a money emergency, your feelings of helplessness can become so overwhelming you literally stop functioning in the real world.
YOU NEED TO HAVE YOUR WITS ABOUT YOU TO RAISE EMERGENCY MONEY
Get yourself Immediate Help
If you recognize any of the above traits in yourself, get the help you need right away. See out a professional counselor … talk to a friend or family member … but talk to someone! If you know someone who is exhibiting the above traits, offer to help them! It doesn’t matter whether you lend then cash, an ear, offer some helpful advice, or help them get counseling, do something!
The first thing that you need to grasp is that no situation is hopeless. With just a little guidance and patience, along with a couple of well thought out goals, and emotional support from family and friends, you can do what it takes to come out of dire circumstances.
You can adapt a new outlook, new skills, and best of all, a new feeling of self-esteem. Don’t allow anyone to tell you different, and if they do, close the same door that they came into and don’t again open it! What you need is positive reinforcement and not negativity to help you get to the other side.
Seek out your True Friends
When you are desperate to raise emergency funds, it usually doesn’t take very long for you to realize who really cares about you, who is truly a friend … be they family or not. Your friends will be there for you in your time of need, offer encouragement, and lend an ear so you can just talk.
Ask for help in coming up with good ideas about how you can raise emergency funds during such a difficult time in your life. Be open to the many suggestions that you will receive.
Prepare to Set your Priorities
There comes the time when you will need to put aside your feelings and just concentrate on the well being of you, and your family. This has to be your priority during times of financial stress and upheaval. In financially stressful times, if you, as the Mom or Dad, can’t cope, how can you expect your children to cope now, or in the future? You must set the example for the rest of the family to draw strength from them.
So make the decision today to learn how to cope, to make the changes you can, to stay focused and goal-oriented, and to let anxiety and financial stress go out the door so that you will be prepared to deal with any money emergencies that come your way.
You need to be able to come up with some quick cash fixes (without additional borrowing) to recover from a Money Emergency:
Budgeting Tip #1:
The first thing you want to do is prioritize to get back on track very quickly. If that means letting your credit card bill go for a bit, so be it. As soon as you realize that you have a money emergency, contact your credit card issuers and request reduced interest rates and payments. Not only one, both!
Budgeting Tip #2:
For your car payment, call the creditor and request a payment extension. Perhaps you hate payment extensions, because they require a fee and you still have to make the payment at the end of the contract. In this case, a payment extension can allow a little breathing room to help you recover during your money emergency. Expect that you will likely have to pay a fee (usually about ¼ – 1/3 the car payment amount) for the extension. Freeing up the money you need today is your first and only goal at this point.
Budgeting Tip #3:
Check to see if your mortgage holder will allow an extension for a nominal fee. Do this today!
Budgeting Tip #4:
Another quick fix, is to host an on the spot yard sale. You don’t have too much time for planning, so do a quick survey of your personal belongings. Come up with clothes that no longer fit, but that are in good condition, knick-knacks, dishes, and books as well as stuff you bought but no longer use.
Throw it all together, quickly. Put some notices up the same day at laundry mats and grocery stores around town, and remember to place a sign at the end of your driveway. You can make a quick $300 this way with very little time and effort.
Budgeting Tip #5:
If you have a larger item to sell, call into the local radio stations to see if they have a “call in swap show” on the weekends. This is a very popular way to quickly convert gently used and more expensive items to fast cash.
Budgeting Tip #6:
Another quick option is with utility and telephone bills. If you aren’t already on a budget plan, ask that the current bill (plus any previous balance you owe) be set up for a budget plan. Expect to pay a down payment (usually ¼ of the bill) and that all future bills (while on the back payment budget plan) must be kept current.
The nice thing about it … it’s usually interest free, and can give you some much-needed breathing space for a month. You must be sure though that you maintain the regular utility payments AND the budget payments in the coming month.
Budgeting Tip #7:
Check with your family church regarding emergency help. Local churches can be one of the best places to find out what’s available in the community to help those in need, or in times of emergency. Check with your local church, first.
Getting Fast Cash through Borrowing
If you are absolutely, positively, in a bind, a real cash emergency, and you have exhausted all of the above, then consider borrowing. First, ask your family, then your local bank.
As a last resort, you may want to consider what’s known as a “Payday Loan.” These types of borrowing stores can be useful when all else fails.
A Few Timely Lessons in Simple Living
Planning for a money emergency takes plenty of forethought. It is best to start to plan now rather than need to scramble to come up with the cash when the need is greatest.
Adapt some strategic thinking.
Reprogram your mind now to become a saver
Simple living yields simply millions in savings
Remind yourself that you can do with less
Make a mindful decision to live light.
Put your entire family on a budget
Discuss strategies about how to build your first budget
Better Money Management Thinking
The first step to making better choices when it comes to how we spend our money or time is living and acting consciously and examining daily money and work habits.
Simple living is largely a matter of making better choices in life: about how we spend, consume, create community and spend our free time.
It is NOT to just consume less. It is to consume smarter OR differently.
We must NOT just go blindly along when it comes to consumption.
Just say no to impulse buying
If you see something you want, put it aside and think about it for at least a couple of days. Chances are, the impulse should pass.
Look to other sources of entertainment
Find ways to socialize and create your own entertainment that don’t revolve around expensive restaurant tabs or event tickets.
Spend time in quiet time
Quiet time helps you recharge your spiritual batteries and give you the time you need to reflect on life and make better choices.
Remember that time is money after all
This time issue is going to loom even larger than money. We, as a society, have concluded that time is money. The two are closely tied. Spend time wisely.
Every Day Money Saving Tips
How to Save Money on Gas
Gas prices just keep going up, and our wallets keep decreasing in size. This how-to will teach you many ways to save money at the local gas station.
1. Take out a credit card. Some credit cards offer gas savings when you use the card for purchases. This works in much the same way that some credit card companies give you frequent flyer miles when you use their card for purchases.
2. Get a gas membership card. Look for membership benefits. In addition, department and grocery stores give discounts at the fuel pump when you use their store membership cards. Shopping at Giant Eagle grocery store and using their membership card, it’s possible (at the time of this writing) to fill a car’s tank for .79 cents a gallon, with savings of $1.36 per gallon.
3. Give your car a good tune up. While giving your car a tune up won’t actually save you money at the pump, it will save you in gas. Using less gas saves you money over all. Have the oil changed, and have a certified mechanic give your engine a twice over.
4. Check the WWW for deals. Web sites let you find the best deals in your area.
5. Buy a hybrid car. Not only do hybrid cars give you immediate savings at the pump, the U.S. government and your local state offer tax breaks for people that use gas saving cars. Federal deductions for using gas saving cars can be as high as $2000. If you can’t afford the growing number of hybrid cars out there, consider getting a regular car with good MPG (miles per gallon), like the Toyota Echo.
6. Turn off the AC. Running the car’s air conditioning puts extra strain on your car’s engine. This translates into you car eating up more gas per mile. Use less gas, save money. Depending on the car you drive, at highway speeds, the AC might put less drag on your car than if all the windows are open. Therefore, you might want to keep it cool on the highway.
7. Use the cheaper stuff. Most modern cars run just as well with the cheap gas as they do with the more expensive gas. In fact, engineers assume the car buyer is going to use the cheap gas, and so, they design the car’s engine accordingly.
8. Don’t fill the tank when prices are higher. Gas suppliers and gas station owners can charge high prices for gas because they know people will pay for it. The owners monitor how much gas people are putting into their cars each day. If they hike up the price a few cents and people are still filling up their tanks, this tells the owners that people are willing to pay the high price. Adding only a few gallons to your car when prices are high sends a message to the owners that people are not happy about the high prices.
9. Don’t drive. Don’t drive when you don’t absolutely have to. Carpooling, walking, taking the bus, and riding a bike not only saves you gas, but these are better for the environment and may be better for your health. Do you really need to drive to the store when it is only a couple of blocks down the street?
10. Check the tire air pressures weekly. Buy an inexpensive manual air pump and an accurate tire gauge (not a pencil gauge as they are not accurate). Keep all tires inflated to the same pressure as recommended for your car but not for your tire. Go by the sticker on the doorframe and not the tire wall.
11. Drive at a consistent speed and keep the windows up tight. Keeping the windows closed reduces the drag on your car. Sticking to the speed limit also helps. So, will using less gear changes and revving the engine less. Avoid accelerating fast or braking suddenly. Use cruise control when you can.
12. Clean out any unnecessary items in your car. If you have heavy objects in your car that you don’t need – remove them. If your car is lighter, it will use less fuel to get you to where you’re going.
13. Avoid leaving your car idle. If you are going to be stopped for more than one minute, you will save gas by turning the car off and restarting when you are ready to go.
14. Buy on cold days. Buy fuel on cold days and if you can, drive on the hot days. When you buy on cold days, and pay for volume, you buy more “mass” of fuel for the same price. Never fill the tank completely or it will overflow when it becomes hotter.
Simpler Solutions for Managing your Money
Let’s face it, coming up with smart and simple ways of saving money takes thinking that is a bit more creative.
Use some of these shortcuts to managing your finances. They are guaranteed to save you time and money.
Trick your mind into saving
Can’t always come up with where your money goes? There is a simple solution: Trick your own mind into spending less and saving more.
If you are up for a challenge, allocate yourself a weekly allowance. Put a set amount of allowance into an envelope and determine that this will be all you will be allowed to spend for any given week.
Next, divide your allowance to take care of your expenses. When you get down to the last $20, that’s the amount you put into your emergency fund. When the money is gone, there will be no more until next week.
Each payday, allocate a percentage to go into a secret fund used only for emergencies. When it’s crunch time, you will know it’s there.
Establish one dresser drawer just to toss single dollar bills. This way when the pizza man arrives, you will have the singles handy and won’t need to break the larger dollar amounts. This discipline forces your mind to think larger amounts and to save larger amounts. You get into the habit of spending only the singles. This works!
To control your credit card debt, carry just one card and pay it off each month. If you are tempted to over spend, the credit card goes into the safe where you only stash your emergency fund. When crunch day comes you have a credit card you can use that will always be in good standing.
Jot down expenses in a notebook and tally them at the end of each week to see if you are over or under your budget estimates. Build in more than you need so that you will always have a cushion in case of a cash emergency.
Tracking your spending takes some work but if you take careful notes, you will always be able to see one or two areas where you’re leaking cash. You can then come up with an extra $20 or more per week in savings. That’s $1,000 a year in real money for an emergency fund.
More tricks to add to your own savings routine:
Have your paycheck automatically deposited directly to savings rather than to your checking account. You will transfer money to pay your bills, but you’ll think twice about withdrawing additional cash.
Make ONLY one ATM withdrawal each week.
Subtract your credit card purchases immediately from your checking account so you’re not surprised once the bill arrives.
When you pay off a loan, add the amount to payments you’re already making to the next lender on your list. You can also send the money to a saving or investment account earmarked for a house, a vacation or a new car and this money will be made available in case of a money emergency.
PAY YOUR BILLS ONLINE AND SAVE
Nearly one-third of U.S. consumers pay their bills online, says Judy Wicks of CheckFree, the leading provider of electronic-billing and payment services.
Probably the easiest way to pay your bills online is to use a safe, encrypted service—offered by banks, credit unions, brokers and companies such as AOL, MSN, Quicken or Yahoo! Arrange for an e-mail reminder that a bill is due.
The service can handle payments entirely electronically or it can generate a paper check, if necessary—to pay the guy who mows your lawn, for example. If a payment is late, many bill-paying services will reimburse you for late fees up to a certain amount (sometimes as much as $50), as long as you have scheduled the payment within their guidelines.
To shed yet more paperwork, arrange to receive bills and statements electronically. Sign up with e-billers on many services or at MyCheckFree.com.
Online bill paying also helps you to keep your finances organized. You have your records right there—what you owe, past payments—and all on one site.
Wells Fargo goes a step further: Its online-banking customers have access to My Spending Report, which they can use as a de facto budget. My Spending Report tracks online bill payments and Wells Fargo debit- and credit-card charges, and plugs them into one of 20 categories so that you can see how much you’ve spent on, say, movies and restaurant meals.
In addition, of course, you can track your spending using Microsoft Money or Quicken. With Quicken 2006, once you pay a bill there’s no need to print and file it. Instead, you can attach the bill electronically to the account from which you made your payment, so it’s always at your fingertips.
Are you trying to figure out which credit card offers the best rebate? Simple solution: Take the cash and run.
It couldn’t be easier than this. With a cash rebate, you get either a check in the mail or a credit on your statement, so you don’t have to weigh the relative benefits of airline miles versus a new set of luggage. To find the best deals, we simplified the process by assuming that you spend $33 on gas each week, $100 a week on groceries and $1,000 per month on other purchases.
Tops is the Citi Dividend Platinum Select card (at . It charges 11.74% and offers rebates of 5% on purchases at supermarkets, drugstores and gas stations and 1% on everything else. However, Citi caps its annual rebate at $300, which you would reach in about eight months under our scenario (at that point you could switch to another card). Exempt from the cap are goods bought through Citi’s Dividend Merchant Network, which includes more than 200 retailers, catalogs and Internet sites. Those purchases earn rebates between 5% and 7%.
Next up is the National City Everyday Rewards Elite Visa card (at , on which our yearlong spending spree would earn a rebate of $270. National City is unique in bundling restaurants with grocery stores in a single category, with rebates of 2%. With an interest rate of 10.49%, the card rebates 4% on gas, 3% on movies and up to 1% on everything else. There are spending caps in some categories.
The American Express Blue Cash card (at *www.americanexpress.com) carries an interest rate of 11.24%. It gives you up to 5% on groceries, gas and drugstore purchases, and up to 1.5% on the rest of your charges, up to a maximum expenditure of $50,000. Total rebate in our example: $266.
The Capital One No Hassle Cash card (at *www.capitalone.com) offers a rebate of up to 3% on gas and groceries and 1% on everything else you buy, with no dollar limit and a relatively modest 9.9% interest rate. You would earn an annual reward of $237 in our scenario.
The Chase Free Cash Rewards Platinum Visa card (at , which carries an interest rate of 11.99%, gives you one point for every dollar spent on purchases (with a $60,000 spending cap). In addition, it has an interesting twist: a one-point bonus for every dollar you pay in interest. Each time you accrue 2,500 points, you receive a check for $25. Without the interest bonus, you’d be eligible for a rebate of $189, so the card is more attractive for card users who often carry a balance.
When saving for an emergency fund – you just can’t go wrong with cash!
Multiple Ways to make the most of a Year-end Bonus
If you have a nice chunk of extra cash to look forward to each year, think now about the best ways to put it to work for you.
Maybe this year you’ll get lucky. You’ve applied for that great, higher-paying promotion and this will boost your monthly pay by $500. You want to make sure the money goes toward building a better future rather than being squandered on items, you just don’t need.
That’s the beauty of getting a year-end raise or bonus—it’s one of the rare opportunities to make a big difference in your finances without having to make sacrifices. You’ve been living without the money previously, so you can take any financial medicine you need even without altering your present lifestyle.
Consider first that all extra cash should first be used to solidify your base.
Next, pay off all credit-card debt.
This can have a gigantic ripple effect on the rest of your finances. As soon as you stop paying higher interest charges each month, you’ll have more money to devote to any other goals.
Pad your emergency fund, if you don’t already have three to six months’ worth of living expenses in a safe and liquid account. That way you won’t have to go into debt or raid long-term savings for unexpected bills when the bigger emergencies do arrive.
Add contributions to your 401(k), if you haven’t hit the limit. You’ll avoid paying more taxes on the extra cash, and you may earn free money if you get an employer match. You can also invest part of your bonus in your IRA if you haven’t contributed $3,000 for 2004 ($3,500 if you’re 50 or older). If you’ve already reached that limit, use your bonus to make your 2005 IRA contribution in January (the limit rises to $4,000 next year, $4,500 if you’re 50 or older) or earmark a bigger chunk of your raise each month.
Take a look at that long-term debt
Now that you have boosted your financial foundation, you have more flexibility. Watson is already in great shape—she’s maxing out her 401(k) and Roth IRA contributions—but she still has about $17,000 in student loans hanging over her head. The loans carry a low, 3.5% rate, so she’s trying to choose between adding the $500 a month to her loan payments or investing the extra money.
With interest rates that low, paying off the loan doesn’t need to be a priority. “If you can earn at least 3.5% in the marketplace, and I believe that you can, then investing is the better way to go,” says Brian Jones, a certified financial planner in Fairfax, Va. Investing becomes even more important if you need to save for a short-term goal, such as buying a house.
However, it’s okay if you’d rather pay off a student loan to get it out of the way. “Psychologically, it’s important to get these debts behind you before you start to move ahead,” says Mari Adam, a certified financial planner in Boca Raton, Fla. “I know people in their 30’s who still have big loans, and that debt becomes like a ball and chain around their leg.”
The same is true if you’re thinking of devoting part of your raise to making extra mortgage payments. Chris Crocket, a doctor in Tupelo, Miss., is getting a big bonus this year that could be enough to pay off his mortgage that has 10 years remaining at 4.75%. As long as he’s covered his other bases, paying off the loan could give him the equivalent of a guaranteed 4.75% return.
Eliminating your mortgage payment can also help if you’ll be retiring soon or worry that you may lose your job, says Evelyn D’Amico, a financial planner in Paoli, Pa. However, you don’t want to tie up too much money in a single investment. For better diversification, you could devote part of your raise or bonus to your mortgage and then invest the rest.
Don’t forget to treat yourself
It is time to have some fun and you deserve it! You worked hard for your bonus or raise, so, go out there and have some fun.
You can set up a vacation fund.
Use part of your extra cash today to pay for the trip you have always wanted. You only need to set aside $310 per month in a savings account paying 2% to end up with $5,000 for springtime in Italy in 2006. Imagine spending the spring in Italy! Now that would be some kind of vacation.
Spend some money on your home.
Many home improvements can save you big money over the long haul. For example, think about the value of storm-resistant windows and shutters. Spending an extra few thousand dollars now, not only helps protects your home, but also can increase its value and lower the premiums on your homeowner’s policy. This is smart planning!
One final idea is to start up a charitable fund. With $10,000, you can set up a donor-advised fund at many mutual fund companies and brokerage firms. You can then deduct the contributions on your tax return straight away and decide later which charities that you wish to support.
A Few Useful Savings Strategies
1. Don’t pay a dime for anything that you can make or fix for yourself.
2. Prolong the life of whatever you own.
3. Use less of what you need.
4. Think creatively. The answer doesn’t have to be “buy a new one.”
5. Don’t toss anything if it can be reused or recycled somehow.
You could do these tried-and-true, pioneer values now.
If you really want to save money, you can’t just look at ways to save now. You have to look at your life, today.
Simple Ways to Bring both Calm AND Savings into your Life
Saving is far more than just an action – it is a way of living, day-by-day.
Start to be calm by first slowing. Whatever it is that you are working on now, stop. Spend the next 30 minutes a day in silence and solitude. You need to teach your mind how to relax, so you can shift from the work-and-spend treadmill and then focus on what’s most important to you.
A calm heart is a tidy heart. It is time to clean up your act. Start today by spending 15 minutes every day going through a closet, a shelf, a drawer, and getting rid of anything you don’t use or cherish. Once you start on these surface areas, weeding that out, the skills and mindset carry over to more complex areas like your work, money and relationships.
It is now time to learn what is enough. Being calm and saving is really about transforming your life in a conscious and deliberate manner. It is determining what is enough in your life, so that you can do more with even less.
Finally, seek out some good support—whether you’re trying to save money or simplify your life.
Don’t go this alone. With Americans $2 trillion deep in debt, you’re certainly not alone in your desire to save money. Find a friend who can help you to get started and then get busy. You will be glad that you did.
Slash your electric bill in 6 easy steps
Spending lots to save pennies makes very little sense, but if you’re already in the market for a new appliance, consider the Web as your first line of defense in energy-savings.
Perhaps you weren’t so Eco-conscious until that glaring electric bill landed in your mailbox. It’s time to become mindful of the green in your wallet and save energy at the same time.
Start by simply unplugging unused appliances, lowering the temperature on your electric water heater to 120 degrees F, and washing only full loads of dishes and air drying them.
At the same time take a look at the free online calculators to get customized tips for improving your home’s energy efficiency at Home Energy Saver, a Web site sponsored by the U.S. Environmental Protection Agency (EPA) and the Department of Energy (DOE).
Spending hundreds to save pennies generally doesn’t make sense, but if you’re already in the market for a new appliance, or even light bulbs, consider the Web your first energy-savings tool.
Think Climate Control
A typical household uses the bulk of its energy for heating and cooling—up to 44% of your utility bill, according to the DOE’s Energy Efficiency and Renewable Energy Network (EREN).
Install a programmable thermostat. This can reduce energy wasted while heating or cooling a house when no one is home or everyone’s asleep.
According to the Home Energy Saver site, Energy Star programmable thermostats can save as much as 20% to 30% on your heating or cooling costs by allowing for multiple daily settings and automatically adjusting when the outside temperature changes.
Participating manufacturers include Honeywell, Hunter Fan and Smart Systems International. Unfortunately, it’s not easy to search for programmable thermostats by Energy Star status. Instead, keep an eye out for those with features typical of the Energy Star thermostats: temperature recovery systems, two programs and four temperature settings.
Think Ceiling fans
When you move the air, you tend to feel cooler. This allows for higher summertime thermostat settings. According to EREN, the effect is equivalent to lowering the air temperature by about 4° F (2° C), and using less energy than air conditioners in doing so.
Think Lighting, Cooking and other Appliances
The next-biggest household energy use after climate control is for lighting, cooking and other appliances. Not counting the fridge, these make up about 33% of a typical utility bill.
Think Compact Fluorescent Lamps (CFL’s)
CFL’s will use up to 75% less energy than standard incandescent bulbs and will last up to 10 times longer, according to Home Energy Saver. This is very good, because they’re also more expensive to start with.
Check your local utility for ideas. Look for a free “Conservation Kit”, containing among other things, two CFL’s. This, of course, is a terrific deal!
Think Energy-efficient Appliances
Use the Energy Star site as a starting point to search for Maytag washing machines. Look for the Atlantis MAV9600 high-efficiency model for $689 at Best Maytag.
Among household appliances, the refrigerator is likely your biggest energy consumer, especially if it’s more than 15 years old. It can account for up to 9% of your energy costs alone. Again, look to the Energy Star site for a list of energy-efficient models if you’re looking to replace yours.
Hot Water Heating
Heating water is the third-biggest home-energy cost and typically accounts for 14%-20% of your total energy bill.
Think Hot Water Jackets
Hot water jackets usually sell for $10 to $20, and shipping charges for buying them online can easily increase their cost by 50% or more. Use the Web to find offline deals in this case.
Think Aerating, Low-flow Faucets and Showerheads
Both Niagara and AM Conservation models popped up on a variety of environmental sites, including EnergyGuide, which also had the best price for the four-way adjustable Niagara showerhead at $6.75. The nice thing about ordering from EnergyGuide is that it automatically searches for any rebates based on the ZIP code you enter.
When you’re considering buying a new home, you can plan for energy savings from the ground up with an energy-efficient homebuilding project. Check the DOE’s Building America and the EPA sites to find projects near you.
GOOD WAYS TO FIND FREE MONEY
If you are tired of making lifestyle changes to accommodate your savings plans then read on. These ideas lead you to prime places to look for money that’s already rightfully yours.
Some people see little point in changing their ways to save a quick $5 or $10. These same people find it difficult to believe such small amounts can actually make a significant difference to their bottom line. They’d much rather indulge in a little daily luxury, like enjoying a cup of espresso each day, then tighten their belts for what they see as measly savings.
For all the spendthrifts at heart, here are some concrete ways to save on things you are already paying for. No need to change your lifestyle or habits in the least. Think of it as money that you are already overpaying to others.
Step up to the plate and claim your free money!
Talking on your cell-phone
You thought you were going to need 2,000 minutes a month, only to find 300 or even 200 would do just as well.
If you’re coming to the end of your contract, or if your service provider is willing to waive the early-termination fee, ask to have your deal changed as soon as possible.
Think about this: Verizon’s America’s Choice 3,200-minute plan runs about $200 per month; you’ll spend just $40 for its 400-minute America’s Choice plan. This is provided you don’t start going over on your minutes and incurring pricey overage charges, that’s $160 in savings each month, or $1,920 a year. Even changing from the America’s Choice 1,100-minute plan at $80, would still cut your telephone bill in half for an added $480 in your pocket.
Local and long-distance calling: If you’re not using all of your cell-phone minutes each month on a plan that doesn’t allow you to just roll them over, you can at least offset your landline costs with those otherwise-wasted minutes. Are you already doing this? Try bundling your local and long-distance plans if you’re regularly spending more than $50 per month. Many bundled plans start at just $50 before taxes and fees and allow you to talk for as long as you want without the huge bills.
Calculate all of the above carefully, though. If your usage is not steady, you’ll pay the same rate every month, meaning no breaks for vacations when your usage normally decreases.
Your checking account: When was the last time you looked at the monthly fees your bank assesses on your checking account? By switching to a non-interest-bearing account, you can pay far less money and avoid higher fees.
Bankrate.com’s annual survey of checking accounts found that average monthly fees are up to $10.86 on interest-bearing accounts, vs. $3.72 for regular checking accounts. You’ll have to keep $2,258 socked away in that interest-bearing account to avoid fees versus the $245 minimum for the non-interest account. So, what are you giving up?
Average yields sat at a paltry 0.27% in the fall of 2003, the time of the Bankrate report. Meantime, if you can, try to plan your ATM withdrawals. The average fee you’ll pay for using another bank’s ATM machine is $2.69 — $1.40 to the ATM’s bank and $1.29 to your own. Eliminating only one of these withdrawals each week can save you a nice $140 per year.
Your insurance: You can save on your insurance policies in a variety of ways. Ask your insurance provider outright for discounts: Besides the usual good student and safety discounts on auto policies, ask for a multi-policy discounts if you’re insuring more than one vehicle. Raise your deductibles on older cars or drop collision coverage altogether if your car is worth less than $1,000. Raising your deductible from $200 to $500 can reduce your premium by as much as 30%, according to Insure.com.
NEVER overpay to borrow your credit cards. Do you think that 2% or 3% isn’t worth fighting for on your credit card’s APR? Consider this: If you’re an average American, you owe $8,940 in household credit card debt, according to CardWeb.com’s CardData Service. At the average APR of 16.44%, you’ll pay $1,470 per year just in interest alone.
For every 1% decrease in APR, you will save $89. However, the difference is far more dramatic over the entire life of your debt. Figuring you can make monthly payments of 5% of your debt per month, you’ll pay $3,334 in total interest at the higher rate. However, at an APR of 13.44%, you’ll have paid $2,551 – that is 23% less.
Also, lots of cards come with added benefits, such as airline miles or, better yet, even cash back. American Express’ Blue Cash card rewards you with up to 5% cash back; the GM card awards 5% back toward a GM new car purchase or lease. On the average credit card debt of $8,940, that works out to $447. Use MSN Money’s Credit Card Analyzer to find other low-rate and cash-back cards. In addition, you can check CardWeb for a list of the monthly rewards that credit cards are offering.
Your mortgage. Your biggest savings potential here is to get rid of PMI, or private mortgage insurance. PMI protects the lender should you default on your loan. You’re obligated to pay this so long as your equity remains below 20%, but once you cross that magic threshold, you should ask your lender to drop the fee.
The law actually says your lender must drop the fee once your equity crosses 22%, provided you have a conventional loan originated or refinanced after July 29, 1999 and you have a good payment history. However, if you have an older loan, you could be paying this unnecessarily without realizing it.
Depending on the size of your mortgage, this could be adding hundreds of dollars to your mortgage cost annually. Look into this, today.
Make the most of your current resources
Begin by using what you have. Paying for Internet access already? E-mail can be a great way to cut your long-distance telephone costs. It may not be a substitute for your weekly heart-to-hearts with Dad, but it probably should substitute for the “when can we get together again?” calls. Why spend precious money leaving voice mail?
Take the time to get rid of what you don’t use. If you’re not using it, you won’t miss it when it’s gone. Donate all unwanted items for a tax deduction, have a garage sale or sell them on eBay. If you have to come up with money for a storage unit for all that stuff, it’s time to eliminate that debt.
Pay attention to potential income
Perhaps you have had a hobby for years but have never considered it as a money earner. Take a good look at it now. If you love to scrapbook, consider putting an ad in the paper to teach others how to do the same. At the same time, establish a Web page where others can sign up to learn your craft online.
Could you have old money just waiting to be claimed? Perhaps, you made a move and forgot about an old bank account. There are plenty of free sites that list people who are owed money by insurance companies, banks and utilities. Try MissingMoney and CashUnclaimed.
Ask for a deal
It’s that time again when you need to go out and buy a big-ticket item. You know by now to shop around for the best price but are you prepared to ask for a deal. Next time you have your heart set on that ruby ring and you are prepared to drop 3K to make the purchase, stop and think about haggling that price a bit. Don’t just assume because you are at a finer jewelry store that the price will be carved in stone. Ask. It never hurts to ask.
Using Good Commonsense and Planning – You Can Survive!!
Armed with the finances that you need to survive, look to the below lists and arm yourself, now, with all of the supplies that you will need in a dire emergency:
Miscellaneous supplies to store up
· 25 pounds laundry soap
· 12 28 oz. bottles dish soap
· 73 rolls toilet paper
· sanitary napkins in sufficient quantity
· 8 gallons bleach (used for sanitation as well as laundry)
· 12 bars hand soap
· 6 24 oz. bottles shampoo
· personal products, such as toothpaste, deodorant
· chainsaw oil and other items to keep things running
· pet foods
· livestock feed
· 55 gallons kerosene for lighting
· 25 gallons Coleman fuel or other lantern fuel
Suggested contents of a good medical kit
A good first aid book
Daily prescription meds for all family
Ointments for the eye, fungus & cuts
Pain and anti-inflammatory medication
such as aspirin
Burn treatment, such as Burn Free
Oral electrolytes (for dehydration from
fever, diarrhea, stress)
Cough drops/throat discs
Needles to remove slivers
A dental kit to patch dentures,
replace fillings, etc.)
Checklist for stay-at-home emergencies
- Food and water for family, pets & livestock for at least 14 days; 55 gallons of fresh water will last a family of four for over seven days.
Daily medications for family for 14 days
Alternative heat source & fuel
Alternative cooking source & fuel
Alternative lighting source & fuel
Flashlights & batteries
Transistor, crank or solar radio
Magnesium, flint & steel fire starter
Checklist for vehicle emergency preparedness
Jack & lug wrench
Battery jumper cables
Basic tool kit
Lighter air pump
Gallon of drinking water
Basic first aid kit
Candles with matches
Cell phone or C.B. can
be a life saver
Storage food in large cooler #1
Dry soup mixes
MREs (military instant Rice
meals; meals ready to eat)
Spices & condiments
Instant coffee, tea, drink mixes
Large cooler #2
Mixing bowl, steel (can double as cooking utensil)
Matches & lighters
Dish scrubber pad
Bowls for family
Silverware for family
Roll of duct tape
Small roll of wire
Metal cups for family
Small water filter
Propane stove & tanks
Flashlight & batteries
Sleeping Gear (in large plastic box) Sleeping bags
Candles & lighters
Unopened gallon of lantern fuel
Warm socks & jackets
10’ x 12’ plastic tarp
Rifle/shotgun and ammunition (food procurement, signaling, and family protection)
Basic fishing gear without rod
Small first aid kit
Roll of wire & rope
Canteen with cup
A few dollars in quarters & bills
IN CASE OF EMERGENCY – BE PREPARED!!