My Personal Finance Journey

Category Archives for Saving Money & Frugal Living

Using Prior Planning to Prevent Poor Performance

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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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The following article is by MPFJ staff writer, Miss T, from Prairie Eco-Thrifter. If you want to learn how to live your dream life in a sustainable, healthy, and money savvy way, check out her site here.

“Prior planning prevents poor performance,” was a line my sales manager used to quote to me frequently when I first started work.

It occurred to me recently that this little saying applies to many areas of life, including personal finances. You need to plan to get where you want to be financially, otherwise, you probably won’t end up where you wanted to be. I can tell you that my financial position improved considerably once I actually started planning how I wanted to spend my hard-earned cash.

Visualize Where You Want to End Up

Before you can set out a plan, you need to know where you want to end up. What position do you want to be in later in life? Do you have a 5 year, 10 year, and 20 year plan? What position do you want to be in when you retire? For that matter, when do you want to retire?

Having a financial plan also helps you manage your money better and actually helps you make it stretch to achieve all the things you want in life. Financial planning helps you know where your money goes and how to keep money in your pocket or account for longer. You know what you want your money to do for you because you have taken the time to work it out in advance. Prior planning means that you avoid unnecessary and reckless spending on things you don’t really need. (Haven’t we all done that at some time?) You will know how much you can spend at any time and what your credit limits are. Never again run out of money before you get to the end of the month.

Steps to Financial Planning

These are some of the reasons why financial planning is a good idea. So let’s look at how you go about it.

The first step is to work out what you want, what is important to you and what you want your financial future to look like. Investigate your personal values – those beliefs that you have about what is right and good. Most people make their decisions based on what they value. Sit down with your partner and determine your mutual values and how your differences could impact your financial future. This step alone will help to avoid many of the arguments couples have over money in the future.

If you find it hard to work out your values and beliefs, consider some aspects of life like savings, education, family, vacations, health, success, debts, entertainment, insurances, food, clothes, culture, sports, hobbies and activities, friends, spending, money and any other things you think of. Rate each point on a scale of ‘important’, ‘not important’, ‘very important’ and ask your partner to do the same. Compare your lists and discuss the areas in which you differ; consider how your differences will impact your financial future.

The second step in planning your financial future is to draw up a budget. Make a list of all the household income and expenses, leaving nothing out. Remember to include occasional expenditure like gifts, hair cuts, vet bills, and magazine subscriptions. Subtract your total expenses from your total incomes; if you get a negative figure, you will need to find where you can cut spending. Try to make several smaller spending cuts rather than just one big hit; this lessens the pain somewhat.

Does your budget include amounts for some general savings, an emergency fund, and retirement saving? These are vital areas to make allowance for in the budget to get your financial plan set on solid footing and enable you to manage unforeseen disasters. You might need to make some tough decisions to set yourself up for a more favorable financial future.

If you have amassed a large credit card debt, like I had, allow extra funds for attacking this expensive debt to get it paid off. This should be your first financial goal; this high-interest debt will impact your financial security for as long as you have it. It will be easier to make the tough choices now than wait until later, when your situation could be more serious.

Once you have your budget in place, you will have a good idea where you stand financially, right now. If your income is insufficient for you current spending needs, consider a better paying job or a second part time job. If your situation is really serious, consider such things as down-sizing your home or buying a less-expensive car.

When you know where you are at the moment, think about where you want to be at different stages of your life. Set goals such as where you will live, what vehicles you’ll drive and holidays you want to have. What do you want your retirement to look like? Work out what these will cost you and factor them into your financial and savings plans.

Your financial plan will always be a work-in-progress. As your achieve goals or your circumstances change, tweak your plan to keep it relevant to your needs.

 How about you all? How do you financially plan?

 Share your experiences by commenting below!

    ***Photo courtesy of http://www.flickr.com/photos/76657755@N04/7027601297/sizes/l/in/photostream/

    Quit Buying Meat from the Supermarket: Buy Straight from the Farm

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    Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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    The following post is by MPFJ staff writer, Melissa Batai. Melissa is a freelance writer who covers topics ranging from personal finance to business to organics to food.  She blogs at Mom’s Plans, where she shares her family’s journey to healthier living and paying down debt.

    Meat gets a bad rap.  Doctors warn that it is bad for our health, especially our cholesterol, and there are routinely stories of meat that causes widespread illness.  However, meat is also an excellent source of protein, and if you eat the right type of meat, it is not as damaging to your health.

    Animals that are fed corn based diets almost exclusively are generally sickly animals.  Their fat stores toxins, which we in turn eat.  Also, many large processors use antibiotics on these sickly animals, which we also ingest.  When these animals are processed, they are taken to a large factory, and a package of hamburger may be made up of several cow’s meat all mixed together.  No wonder there are occasional outbreaks of illness.  It is surprising human illness from consuming this meat doesn’t happen more often!

    You can take a stand against this kind of meat production and perhaps save money by buying meat directly from the farmer.  Our family hasn’t bought any meat from the grocery store for over three years, and we don’t have any plans to.  The meat that comes straight from the farmer is much tastier and healthier, in my opinion.

    If you would like to buy directly from the farmer, here is what you need to do:

    Find a Farmer Near You – CSAs

    If you don’t know of a farmer, finding a place to buy your meat is often most difficult.  However, there are some websites to assist you.  LocalHarvest.org is a great resource.  Type in your zip code, and you will get a list of the CSAs near you.  The majority of farms will list their produce CSAs first.  You will have to probe a bit deeper to see if the farm also offers a meat CSA.

    With a meat CSA, you will get a variety of types of meats, often once a month.  We subscribed to a meat CSA last year, and typically got cuts of beef, pork, and lamb in our monthly deliveries as well as whole chickens sometimes.

    Most of the animals that come from a CSA are not given antibiotics and are allowed to freely graze.  Still, calling the farmer to discuss how the animals are raised and how much grain they receive is a good idea.  Remember, the higher the quality of meat you consume, the healthier you will be.

    Grass Fed Animals

    If you want to find the highest quality meats that are high in healthy omega-3’s, you will likely want to consume entirely grass fed meat.  The site, eatwild.com, has a listing of farmers near your area that only feed their animals grass.  (In the winter, farmers often feed them grass that has been dried in the summer rather than feeding them grains.)

    Because this meat is considered the highest quality, it is great for your health, but it is not a frugal option.

    Buy Direct from the Farmer

    The most cost efficient option when buying meat is to buy direct from the farmer.  My cousin is an Angus cow farmer, and we buy 1/2 side of beef from him every year.  Our order 18 months ago gave us cuts like chuck roasts, T-bone steaks, Porterhouse steaks, sirloin steaks, and ground beef, to name a few.  We paid $514 for 117.5 pounds of meat, averaging $4.37 per pound.  Sure, that isn’t the best price for ground beef, but it is a good deal on the nicer cuts of meat.  Even more importantly, we know where our meat comes from, how it was raised, and how it was processed.  We know our ground beef only includes meat from one steer.

    If you would like to find a farmer, check with your friends who may buy a 1/2 side of beef, or look in the phone book.  Another option is to just Google “farmers selling beef in Nebraska” substituting your desired type of meat and state.

    Questions to Ask the Farmer

    Before you agree to buy any meat, you will want to ask some questions.   Some that may be important to you are as follows:

    -Are your animals given antibiotics or other medicines or chemicals?
    -Are they exclusively grass fed?
    -If they consume feed, what type?   Is the corn non-GMO?  Is the soy?  Are there any animal bi-products in the feed?
    -How are the animals processed?
    -Is there a discount for bulk purchases?  (Perhaps you could buy an entire cow for a discount and split the meat with some friends and relatives.)

    Concluding Thoughts

    Buying locally from a farmer can help your bottom line.  Even if you don’t find the meat to be cheaper than the meat in the grocery store, you will typically be eating higher quality meat.  While I skimp in lots of areas of my life, I don’t like to skimp on food.  Even though organic produce and meat is more expensive, I hope that I am saving on healthcare costs in the long run by taking care of my health and my family’s.

    How about you all? Have you ever bought direct from the farmer?  Would you consider doing so?

    Share your experiences by commenting below!

      ***Photo courtesy of http://www.flickr.com/photos/audreyjm529/1799343748/sizes/l/in/photostream/

      When Renting is Better than Owning a Home

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      Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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      The following is a post by MPFJ staff writer, Kevin Mercadante, who is professional personal finance blogger, and the owner of his own personal finance blog, OutOfYourRut.com. He has backgrounds in both accounting and the mortgage industry.

      Owning a home is right there with baseball and mom’s apple pie as an American virtue. It’s seen as the centerpiece of middle-class life and as the foundation of financial success. But, there are times when renting is better than owning a home.

      What are some of those times?

      Establishing yourself early in life

      There’s often an emphasis on buying a house as early in life as possible. It’s similar to the imperative to begin funding your retirement plan, in that you begin paying down your mortgage so that it is fully paid off well before your retirement. In the meantime, the house should rise in value over time, providing you with a substantial asset in addition to shelter.

      There’s no doubt that that line of reasoning makes abundant sense. However, when you’re in your 20s and life holds so many variables, owning a house can be more of an albatross than an advantage. If you meet and marry someone from out of town, or you need to relocate to follow a job, the house could be a problem you don’t need.

      When you’re young and trying to establish yourself in life, it’s often best to do it with as little baggage as possible. A house is a big piece of baggage, and can get in the way of important plans.

      During financial hardship

      Though we often think of a home as a safe harbor, it can be quite the opposite during a financial hardship.
      For one thing, when you’re going through financial hardship, you’ll need cash. It’s not at all easy to get cash out of the house anymore. Cash from home equity lines are harder to get than they used to be. But, if you’re having financial troubles, you won’t be able to qualify anyway.

      You could also consider selling the house, but that presents its own set of problems. For one thing, there’s no way to know how long it will take to sell the house. For another, personal financial troubles often coincide with national economic problems. Selling a house in that environment isn’t always possible.

      Cash flow is another problem. Financial troubles usually require that you lower your living expenses. Largest of these typically is the house payment. If you rent, you can always find a cheaper place to live. If you own however, that won’t be so easy to do. In addition, as an owner, you will have repair and maintenance costs that will soak up more precious capital.

      Being a homeowner isn’t always the best state of affairs when you’re facing a financial crisis.

      When you have a career that involved frequent job changes

      Some people are in career fields that require frequent job changes. The typical situation may be a person who is on the management fast-track, and has to move frequently in order to follow promotions within the organization. Owning a home usually doesn’t help a person in the situation.

      Every time you have to move to make a job change, you’re faced with the choice of either selling your home or renting it out. The current housing market makes it very difficult to buy and sell a house every three or four years and to do it without losing money.

      If instead you decide to rent out your home, after 10 or 15 years you’ll have a portfolio of rental properties that are all over the country. Not only will that be very difficult to manage from an investment standpoint, but it might conflict your primary occupation.

      When you‘re making a big push for retirement or starting a new business

      This one is not true in all cases. Sometimes owning a home can be a significant part of both retirement planning or an effort to start a new business. In other times…it can sort of get in the way.

      How can that happen?

      Let’s say you’re starting a new business, and you need every dollar you have to cover either start up costs for your venture, or living expenses for the first few months. Your house would represent a fixed expense plus the variable costs of repair and maintenance. That would compete with your efforts start a business on a shoestring.

      The same could be true with retirement. If you are looking to load up on your retirement savings, especially if you are a little bit late in doing so, the cost of owning your home will compete with your efforts. It will be difficult to put extra money into your retirement plan when you need to replace the roof, the air conditioner, or the carpeting in your house.

      There is no way to know for certain if owning a home would or would not be a problem in any of the above situations. But at the same time, it’s not necessarily true that owning a home is the right course for everyone. Consider the choice to own or to rent based on your own personal circumstances, keeping in mind that owning may not necessarily be the right thing for you.

      How about you all? Do you think renting or buying makes more sense?

      Do you think your opinion of renting vs buying changes as the housing market conditions fluctuate?

       Share your experiences by commenting below!

        ***Photo courtesy of http://www.flickr.com/photos/29456235@N04/5396894948/

        Why Building Credit in Your Teens is Crucial in Your 20’s

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        Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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        The following is a guest post written by Jason Bushey. Enjoy! 
        Like most 20-somethings, I’ve learned my fair share of lessons the hard way while adjusting to the scary post-college existence that is the “Real World”. Of these, few have had as much of an impact as the experience I endured while applying for a car loan.
        For those of you that want to skip the end, I’ll leave you with this: You should start building credit as early as you can, because your credit history will be absolutely crucial when applying for a loan in your 20’s.
        Now, if you’d like to know the whole story (and how you can avoid the same mistakes I made), I’ll start from the beginning…
        I’ve actually had a credit card in my account since I was 19. I was at home during Winter Break one semester when my Dad told me it was finally time to start building credit in my own name. So, when a student card offer came in the mail with my name on the envelope, I filled out the application, snail mailed it in, and in a couple of weeks I had a credit card with a $250 credit line in my back pocket, collecting dust.
        OK, I made a few purchases on the card – including a pair of concert tickets that were a little out of my price range – but by and large I wasn’t racking up a ton of credit history in my name. (Unbeknownst to me, since I really didn’t have a clue about finances in college. Who needs to learn about money when you don’t have any, right? … Wrong.)
        So, fast forward to a few years later; I had graduated college, moved out to the west coast sans car and was in the market for some new wheels. I had enough for a down payment and what I thought was a pretty reasonable monthly payment, but – and this is a theme in this story – I was wrong.
        As it turns out, having a great credit score (which I had) isn’t always enough to get you a loan in the post-Great Recession world of lending, nor is having a job (which I did, albeit with an entry level income) and references.
        What is important, however, is credit history. And, mine was extremely limited, as I would come to find out.
        So, after getting not one but two loans denied after finding a car in my price range, I had to hit up my Dad (there he is again) to co-sign. So much for being independent…
        However, at the 11th hour and after dealing with a handful of banks, car dealerships and salesmen – my worst nightmare, really – my local credit union stepped in and approved me for a loan with reasonable interest (thanks to my credit score) and a low monthly payment. No co-signer needed.
        The lesson? (Other than the fact that credit unions are awesome.) Building a strong credit history is extremely important when you’re young, and will have a huge factor on whether or not you’ll be approved for a loan in your 20’s.
        So, if you want to avoid the hassle and headaches that I endured, here are a few tips on building your credit in your teens and college years as you prepare for post-grad life in the dreaded real world…
         
         

        Apply for a credit card early

        Since the 2009 Credit CARD Act passed, it’s been a little trickier for under-21-year-olds to get approved for a credit card on their own. However, the earlier you apply for a credit card in your name, the better.
        That being said, make sure you (or your son or daughter) are responsible enough with your finances to own a credit card. You don’t need me to tell you that not everyone is fit to own a credit card, and according to the credit bureau, TransUnion, the average consumer carried close to $5,000 in credit debt in Quarter 3 of 2012.
        One way to alleviate this issue is to start you or your kids with a prepaid debit card. It gets a consumer-in-training in the habit of spending only what they can afford, and works as a great “training card” before applying for the real deal.
         
         

        Use your credit card responsibly and make on-time payments

        Another thing I learned late in the game is that a dormant credit card account only improves your credit score for so long. Creditors want to see you using that shiny new credit card. Otherwise, competing lenders will have little interest in supplying you with credit down the line. (And that’s more or less what your credit score is all about – how appealing you are in the eyes of lenders.)
        Set aside a few everyday items for credit card use each month, don’t splurge on expensive items and keep your balance low so that each month, paying your credit card bill on time is a non-issue.
        Speaking of on-time payments, the number one way you can improve your credit score when you’re young is by making on-time payments each and every month. It’s that simple.
        Seriously, nothing kills a credit score like a missed payment. Make paying your credit card bill your number one priority when it comes to personal finances when you’re young and you’ll be on the road to a great credit score and credit history in your 20’s. Finally…
         
         

        Piggyback your parents’ accounts

        Many consumers aren’t aware that when they add an authorized user to a credit card account, that user can then piggyback the credit accrued by that very same account moving forward. This is another easy way to build credit when you’re young, and can make for an excellent second credit account especially.
        Sure, the conversation might sound a little strange at first: “Good to see you, Mom and Dad! Now can you please add me to your credit card account?” But, if you explain the benefits and the lack of risks involved with piggybacking an account (as long as they’re in good standing, you’re in good standing), then hopefully they’ll oblige to let you in on their good credit.
        Stick to these simple steps and odds are on you’ll have a lot less trouble applying for a loan in your 20’s than I did.

        How about you all? What age were you when you started to build your credit history? Do you wish you started earlier?  

        Share your experiences by commenting below!

        ***Photo courtesy of http://www.flickr.com/photos/glynlowe/7374460750/sizes/l/in/photostream/

        How NOT To Shop Smartly Online

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        Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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        The following post is by MPFJ staff writer, Kelly Gurnett. Kelly runs the blog, Cordelia Calls It Quits, where she documents her attempts to rid her life of the things that don’t matter and focus more on the things that do. You can also follow her on Twitter and Facebook.


        With the hassle and crowds in stores this time of year, it’s no wonder that more and more people have taken to buying most of their holiday gifts online. It’s easy, convenient, you can do it in your PJs, and you can find some terrific online bargains…if you know how to shop smartly.

        Below are several of the most common pitfalls to avoid when it comes to shopping online, for the holidays and throughout the year:

        Overdoing It to Reach Minimum Shipping Requirements

        Lots of sites dangle the promise of “free shipping” in front of you like a carrot, luring you to purchase through them…only to tell you, once you reach checkout, that you only qualify if you purchase a certain amount of stuff. (Missed that fine print and your excitement, didn’t you?) 

         This can tempt you into adding just a few more items to your cart to reach that minimum—items you probably don’t really need, whose cost alone could nullify whatever you’re saving on shipping.

        The solution? Check out FreeShipping.org for a list of stores that offer pro-bono shipping without the minimum requirements. If you’re shopping from a big-box store like Walmart or Sears, see if you can order online but pick up in store. And if you’re shopping on Amazon, there’s a great site called Amazon Filler Item Finder that will help you find items around the price range of that extra $2.17 you need to qualify for “Free Super Saver Shipping.”  You don’t have to search very hard to find something you’ll probably actually use (like a kitchen utensil or a small tool), which saves you from buying that $30 bestseller from your Wish List because the free shipping makes it feel justified.

        Not Paying Attention to Shipping Times

        If you’re buying through sites like Amazon Marketplace and eBay, you’re buying from everyday people all across the country (and the world) who all have their own individual shipping schedules. Even if you buy through the main Amazon site, many items are offered by third-party sellers, whose shipping times can vary wildly. I once nearly ordered an item before I noticed the estimated shipping time was four to six months! (Must’ve been a wildly popular whatever-it-was.)
        The solution? Especially in this season, when time is of the essence, make sure you’re aware of how long it will take for each item to arrive, or you could wind up giving some people cards with pictures of their items and the words “Coming soon!” underneath. (Your best bet, honestly, is to start shopping early so that you don’t wind up paying for last-minute rush fees to get that gift under the tree.)

        Being Lured in by Bright, Shiny Sales and Discounts

        “Half-price on many items TODAY ONLY!” Chances are the items that are on sale are not the ones you need. (And that there will be several more “TODAY ONLY!” sales pretty every day from now till Christmas.) So, don’t buy that designer-whatever just because it’s 70% off unless you actually had “designer-whatever” on your shopping list and this truly is the best deal you’ve seen yet for it.


        “This item sells for $299 $50)” Just because this particular site has slashed its price on an item doesn’t mean you can’t still find that item cheaper elsewhere. Plenty of sites sell items below the manufacturer’s suggested retail price, so simply being below that doesn’t necessarily guarantee you the best deal. (Although the numbers can look awfully impressive.)


        The solution? Have a list, check it twice, and only buy the items you need—at a price you’re sure is the best. Hit up sites like PriceGrabber or BizRate to see what something is selling for across the web.

        Not Knowing Return Policies

        Especially at the holidays, when you find yourself buying items for people who may or may not like them from sites you may not have shopped at before, knowing a site’s return policy is crucial. Even if the gift is exactly what the recipient wanted, anything can happen from the time you place an order to the time that box arrives on your door—things can get broken, the wrong item can be shipped, you can learn the person already got that gift from somewhere else. You never know, so make sure to hedge your bets.


         The solution? Check out the return policies on any new site you visit (or any site you’re not thoroughly familiar with). Make sure there’s at least a 30-day return window and that items can be returned for any reason. Stores that give you free return labels to send items back get double-points.

        How about you all? What mistakes have you made in the past when shopping online? What strategies do you use that seem to work very well?

         Share your experiences by commenting below!

          ***Photo courtesy of http://www.flickr.com/photos/dinomite/6192822061/sizes/l/in/photostream/

          How Much Do You Save When You Are In Debt?

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          Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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          The following is a post by MPFJ staff writer, SK. SK writes about the reasons we get into debt, changing the patterns that get us into debt, and examines small business ownership and real estate investing at her blog, American Debt Project.
          When it comes to getting out of debt, I am not an expert. 

          I do have personal experience with it, as I just passed the 50% debt payoff mark, but I am not so vain as to tell you guys that I have found the way to get out of debt and my way is the only way!  

          To successfully get yourself out of debt, I think the opposite is true. You have to find a way to get out of debt on your own, and implement your plan wholeheartedly to make it work. For many people, saving money when getting out of debt is counter-intuitive. If you are not actively investing that money, it’s simply sitting there as cash or earning measly 1% interest, while paying off debt means you are getting rid of a liability with interest rates anywhere from 6% (student loans) to 29.99% (really sub prime credit cards). 

          So why should you have any money saved when you have debt that is costing you more money? Let’s consider both sides of this issue.

          $1,000 Emergencies Happen All the Time

          This is a Dave Ramsey tenet of financial wisdom. Basically, Ramsey says before paying off debt, you should set aside $1,000 to be able to deal with unexpected emergencies without using a credit card. 

          But, let’s consider my case. In the 18 months since I got serious about paying off my debt, I only had one unexpected expense over $1,000. I decided to pay off my car 9 months ahead of schedule because it significantly reduced my monthly bills and improved my debt-to-income ratio. I’ll admit, if I hadn’t set aside that money in savings, it would have been tough to make this move. However, it was not an emergency. It was me making a decision to not let my savings just sit there. I’ve had some situations come up over the past 18 months (including lending someone money), but I was able to manage it within my normal expenses and some scrimping.

          Do emergencies happen? Yes. Anything can happen! But in my case, I think it makes more sense to use $1,000 productively when you have over $20,000 in debt (I currently have about $18,000 in debt left to pay off). In many instances, you will have a few days to deal with a situation and can round up the money needed by delaying payment on other items.

          You Don’t Want to Have Nothing When You are Finally Debt Free

          I have heard others insist that it’s important to have savings so that when you are debt free, you are not back at zero, where it is easy to fall back into debt. Although I contribute at least 15% of my income to my retirement accounts, other than that, I will likely not have very much in savings when I pay off all my debt.

          Am I afraid I am going to right back to my old habits and charge up a storm on my credit cards? No! Because that’s exactly the point, I am not afraid anymore. I have been arm-wrestling myself daily for the past 18 months to get over bad habits and impulsive spending. It’s OK to be nervous about the next step when you are finally consumer debt-free, but it doesn’t mean you have fear. You are strong enough to do what you need to do. I personally think the $1,000 buffer is just a mental pacifier, meant to soothe you into thinking you “have things covered”. But you might not always need it and that money could be better spent elsewhere.

          What do you think? Are you saving and paying off debt? Are you just paying off debt with no savings at all? Let me know!

            ***Photo courtesy of http://www.flickr.com/photos/68751915@N05/6736138697/sizes/l/in/photostream/

            Creative Christmas Gift Ideas

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            Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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            The following post is by MPFJ staff writer, Shondell of Call Me What You Want, Even Cheap. She blogs about her recent car loan and mortgage pay off and a whole bunch more. Check out her blog right here.

            With the imminent arrival of Christmas, the time to give and receive gifts has come again. Shops and supermarkets already have attractive promotional signs, posters and banners on their doors, windows, and wherever they can find unused space. There are clothes, cosmetics, and fashion accessories to buy for us women; clothes, shoes and electronics to buy for men; and clothes and toys to buy for children. Everyone loves receiving gifts, but the funny thing is that they are often forgotten a few days or weeks after it`s received.

            Every Christmas, it’s the same old story. Can you still remember the gifts that you gave or received two years ago? I can hardly remember the ones that I gave last year, let alone two years ago. So, why not do something different this Christmas, something out of the box that will leave your friends and family awestruck. Instead of the usual stuff that you buy at the mall, you could do something creative.

            Here are some creative Christmas gift ideas that both you and your friends and family will love.

            Donate to your friend’s favorite charity: 

            If your friends have a charity that they are fond of and have been asking you (directly or subtly) to make a donation, Christmas can be the perfect time to do that. This thoughtful gesture is sure to bring a smile on their face. You can even go and make the donation with your friend or you could just give the receipt to your friend. I know if I got a gift like that, I would never forget it.

            Donate blood to the needy: 

            Every day, there are hundreds of people looking for a pint or two of blood. They may be victims of an accident, someone needing an operation, or someone who is terminally ill. Christmas is a great time to donate blood because there is an increase in road accidents during the holiday season. Plus, it`s free! I am so afraid of needles, so this wouldn`t be my first option. But, for those of you who aren`t a wimp like me, giving blood is a great gift.

            Donate books to your child’s school: 

            Schools, big or small, are always in need of new books for their library. Donating books to your child’s school is an act of altruism that will benefit all the children in the school and your entire community. You could ask the librarian for a list of books they are in need of and then deliver the books just before the school closes for the holidays. After the school reopens, check with the librarian to find out how the school intends to use the books and give your own suggestions if you feel they need any.

            Help pay your struggling friend’s debt: 

            A friend in need is a friend indeed, the age old saying goes. And when your best friends are going through a financial crisis, could there be a better way to show them how much you love and care for them than to help them financially?

            If your friend has a mortgage loan and he is struggling to make payments, then help him with whatever amount you can. I am not a fan of loaning people money, especially if you want to remain friends with someone. Giving them a gift to help out with their debts, or if you are in a position to pay off their debts, go ahead and spread that Christmas cheer!

            Send a box of toys to an orphanage: 

            Children love to receive gifts, and those without parents appreciate the kind gesture even more. Receiving even the smallest gift can help make a child feel like a million bucks. So, why not send a box of toys to an orphanage this Christmas? You can contact the orphanage to get some ideas of what the kids are in need of. On Christmas day, you could hand out the gifts personally to the children. Seeing their faces light up will probably bring tears to your eyes. If you have children, consider bringing your kids to participate as well.

            Invite a homeless person to dinner: 

            Homeless people are just like everyone else; the only difference is that life has been unkind to them and left them without a family or home. Picture yourself in their place and imagine how much they crave the warmth of a home, the delicious aroma of cooked food, and the kind gesture of someone more fortunate than themselves. The least you can do for them this Christmas is invite some of them to a sumptuous dinner. If you think the idea is risky, then deliver the food to them. I am sure they will be happy and grateful for your thoughtfulness and generosity.

            How about you all? Have you ever given a Christmas gift outside of the ordinary gift?

             Share your experiences by commenting below!

              ***Photo courtesy of http://www.callmewhatyouwantevencheap.com/wp-content/uploads/2012/12/christmas-gifts-300×224.jpg

              Tips to Help Tighten the Purse Strings For Christmas

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              Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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              The following is a guest post by Grant Georgiades. Enjoy! 

              Christmas is the time of year where families find themselves in serious debt. It is such an expensive time of year – from buying Christmas gifts to attending parties and having the children at home and keeping them occupied to grocery shopping. 

              But, you don’t have to spend next year paying back debt from this Christmas. Tighten your purse strings and enjoy a debt free Christmas the easy way.

              Hide the Credit Card

              If you cannot afford to pay your credit card or store cards back within a short period, don’t use them. The interest you pay on your credit card can leave you paying back the whole of next year just because of one week of celebrations. If you can’t trust yourself, place your credit card in some water and pop it in the freezer, by the time you want to use it and pull it out and eventually chip all the ice away, you will have changed your mind.

              Use Vouchers and Coupons

              It’s the time of year when all the vouchers and coupons start pouring through the letterbox. Don’t be shy to use vouchers – you can save a lot of money in the long run. Grocery vouchers for family meals, discount vouchers for gifts and so much more. Take advantage of these now.

              Are You Paying Too Much Insurance?

              Now is the time to try and reduce your costs for next year, so plan ahead. Are you paying too much on your insurance? If so, shop around and try and get the best trade plan insurance policy at the lowest price, and save money looking forward.

              Shop Online

              While you may enjoy the thrill of wandering from shop to shop, you can save a large sum of cash this Christmas by shopping online. You can search for specific items, compare prices, and pay the lowest possible price. Take advantage of auction sites such as eBay and Half.com where you can find great deals for really good prices.

              Recycle Your Old Phones

              Are you one of the many that have old mobile phones lying around in drawers throughout the home? You can recycle them through a selection of companies and get a check back for your efforts, a little helping hand when buying Christmas gifts this year.

              Secret Santa

              You have a large number of friends and buying a gift for each friend can work out a really expensive exercise. So, why not have some fun with it and agree on a Secret Santa? 

              Everyone pulls a name out of a hat and buys a gift for that person for the agreed price. This way, everyone gets a gift, and you don’t end up emptying your purse.

              How about you all? What methods do you use to save some money during the holidays? 

              Share your experiences by commenting below!

              ***Photo courtesy of http://www.flickr.com/photos/68751915@N05/6722570555/sizes/l/in/photostream/

              6 Ways to Keep Your Holiday Gift Giving Costs Reasonable

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              Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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              The following post is by MPFJ staff writer, Melissa Batai. Melissa is a freelance writer who covers topics ranging from personal finance to business to organics to food.  She blogs at Mom’s Plans, where she shares her family’s journey to healthier living and paying down debt.
              When my husband and I were first married, we had very little extra money.  That first Christmas, we budgeted carefully and only spent the little money we had set aside for gifts.  When we arrived at my mom’s house, we saw that she had many, many gifts for us.  And, we felt bad, so December 24, we were out frantically shopping to buy her some more gifts.  We spent $150 more that day, and when you don’t have any spare money, that is a lot.

              I still remember frantically trying to raise money when the credit card bill came in by selling books on half.com and trying to find some extra jobs.  It took us until March to pay off those presents we hadn’t planned for.
              Needless to say – we never did that again.
              If you’re looking to keep your holiday gift spending reasonable, there are several steps you can take, now, so you aren’t paying off the presents several months after Christmas is over.

              1.  Tell your family your situation.  If money is tight for you this year, give your family and friends an early warning that the Christmas gifts may be a bit sparse this year.  Chances are, most people would rather you be honest (and stay out of debt) rather than spend money you don’t have.

              2.  Raise money before you spend it.  Last year, Financial Samurai challenged himself to make money for the holidays before he spent it.  Several hours of work paid for every gift on his list.  He did it through lining up a few advertising deals for his blog, but there are many ways you can do this–get an extra job, donate plasma for a few weeks, sell stuff around the house that you don’t need on Craigslist or eBay.  My husband and I recently sold stuff we didn’t need, and in two weeks, we made $475.  That would be plenty for Christmas gifts.

              3.  Make homemade gifts.  I am continually impressed by the homemade gifts that The Prudent Homemaker is making.  If you have to get gifts for children, you may be inspired by her gift a day series.  Pinterest is another great place to find homemade gift ideas as are frugal mom blogs.  You can make something like a scarf or make cookies or fudge or give soup kits or even make muffin tin crayons from old crayons you have lying around.

              4.  Draw names.  Don’t feel the need to buy gifts for everyone.  If you have a close circle of friends, maybe this year you can draw names and only buy a gift for one person instead of all of your friends.

              5.  Cash out rewards points.  If you get credit card reward points, consider cashing them out.  I cash out 5,000 reward points from my credit card every year to get my mom a $50 Red Lobster gift cards.  It is one of her favorite gifts because she goes there so frequently, and it doesn’t cost me any money.  If you are planning to do this, do so sooner rather than later to give time for shipping.

              6.  Check out Craigslist and eBay.  You may feel a bit funny about buying presents on Craigslist and eBay, but you can find good stuff.  We had a brand new suitcase that had never been used that we didn’t need.  We sold it on Craigslist for $20 to a woman who was going to give it to her mother as a Christmas present since she would be traveling abroad in February.  By checking Craigslist, she easily saved herself $50 to $70 on a new, large suitcase.
              The holidays can be a joyous time, but don’t make them any more stressful on yourself by feeling the need to overspend.  There are plenty of ways you can spread holiday cheer without regretting it for months after Christmas.
              How about you all? What are your favorite strategies for keeping holiday spending in check?


              Share your experiences by commenting below!

                ***Photo courtesy of http://www.flickr.com/photos/luminarie/2179728755/sizes/l/in/photostream/

                3 Essential Tips for Selling Your Home

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                Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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                The following is a guest post by Amanda Green. Enjoy! 

                 Selling a home can be just as nerve-wracking and anxiety-producing as it is exciting. While those who sell their homes often have a lot to gain, the wrong move can turn into a rather huge loss. There’s no getting around the fact that it is essential to be careful when selling a home, especially if you or your family has never sold a home in the past. 

                The following are just a few tips that can help to ensure the process goes as smoothly as possible, and that you reap all of the potential benefits.

                1. Educate Yourself on Bonds and Investments 

                Many people don’t realize just how important it is to learn as much as possible about bonds and investments before setting out to sell a home. Chances are the buying and selling of a home will be one of the largest investments you’ll make in your life, and going in blindly is never a wise idea. Surety bonds, for example, often pop up when a home is being sold, and learning more about them and how they work can help to ensure that you don’t make any quick, unwise decisions. The more you know about the different types of investments that are available to you, the better prepared you’ll be to sell your home.

                2. Hire a Realtor

                It’s not uncommon for people to feel as if they have what it takes to sell their home without the assistance of a Realtor. While this may actually be true, it’s not exactly typical, and it’s difficult to argue with the fact that working with a professional can help you to maximize your gains when selling a home. Hiring a realtor isn’t always as easy as it may seem, however, as it requires one to do their homework to ensure that the person they end up going with will actually do a good job.

                Look for Realtors that have been selling real estate for many years, and be sure to know exactly what they expect in regards to commission. While you’ll end up spending an extra chunk of money on a Realtor, they may be able to get you much more for your home than you could on your own.

                3. Hire a Lawyer

                Just because you’ve hired a Realtor doesn’t mean you’re in the clear. In order to get the most out of selling a home, you’ve got to hire a lawyer to help with the closing and oversee the entire process as a whole. The legal side of selling a home can be very tricky to navigate, and you don’t want to do it on your own. With a good lawyer on your side, you won’t have to worry about this aspect of selling your home at all.

                By hiring a lawyer, getting a good Realtor, and learning as much as you can about investments and bonds, you can ensure that the process of selling your home goes smoothly, and that you get the most out of it.

                How about you all? Have you sold your home before? What was the hardest part of the process?

                 Share your experiences by commenting below!

                ***Photo courtesy of http://www.flickr.com/photos/mdgovpics/7605435738/sizes/l/in/photostream/

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