Tag Archive saving money

ByCurtis Watts

Why Would A Person Choose To Live A Frugal Life?

For some reason, there is a myth out there that living a frugal life means you are living a boring life. Some even believe that if you are frugal then you are a bad parent, a bad person, and a bad friend.

If you don’t believe that, I recommend you read the comments on the next frugal living-related article on a major website such as Forbes, YahooFinance, or something similar. One thing that will be in common with most of the comments is the negativeness from many of the commenters.

I’ve even overheard conversations myself where people think I’m missing out on life because they assume that all frugal people just sit at home all day and do nothing with their lives.

That is FAR from the truth. I know many who are taking part in frugal living and I think they are some of the best 🙂

Sadly, many aren’t interested in frugal living because they believe the myth above.

There are many reasons to live a frugal life, though. Continue reading below to see the reasons for why many choose to take part in frugal living.

 

1. You want to be comfortable in your financial situation.

Seeking financial freedom is something that many are aiming for by living frugally. Being frugal may give you a better chance at reaching this since you are most likely honest with yourself about how much money you earn, how much you spend, and how much you need in order to survive.

Knowing that you are in control of your financial situation is a great benefit of living a frugal life!

Not being comfortable may even lead to debt, which I discuss in the next reason…

 

2. You want to avoid debt.

No one actually wants debt, right? By choosing to live the frugal life, you may be able to avoid debt much more than the average person.

By avoiding debt, you will have less stress due to the fact that you won’t be worried about the next bill you have to pay and the amount of interest that is building up.

You will also be more likely to retire earlier, buy the things that you actually do want to buy, and more.

Related article: How To Live On One Income

 

3. You want a simpler life.

Bigger isn’t always better. More isn’t always better either.

By living a frugal life, you are most likely making do with what you have, buying and using quality items that will last, and so on.

By having less stuff and less clutter in your life, you will live a more simple life that you can truly enjoy. Material items do not always equal happiness. Sometimes they just add stress, debt, and more. Think about it – the more stuff you have, the more likely that something will break, something will get lost or tossed to the side, and so on.

 

4. You know that you can still have fun while being frugal.

Anyone who thinks you can’t have fun while being frugal is crazy. You don’t need to spend a ton of money or be rich in order to enjoy life.

Yes, you can still go on vacations, buy your dream home, have a family, spend time with friends and family, and more. Being frugal doesn’t mean that you are giving up fun things in life.

Side note: I recommend looking into Digit if you want to trick yourself into saving more money. Digit is a FREE service that looks at your spending and transfers money to a savings account for you. Digit makes everything easy so that you can start saving money with very little effort. Read Digit Review – A New Way To Save Money.

 

5. You want to appreciate everything and anything around you.

When we were spending more due to lifestyle inflation, we realized we weren’t really appreciating the things we were spending our money on.

We were buying things, not enjoying them, and just being a little lazy because we weren’t in the right mindset. I didn’t like feeling this way because I felt wasteful and even guilty of the way I was behaving.

Life is great and you don’t need to be rich in order to enjoy it. By living a frugal life, you are more likely to appreciate what you have.

Would you rather enjoy each meal you eat, each item you buy, and more? Life is a great thing and appreciating the little things can be a great feeling.

Are you interested in frugal living? Why or why not? Why do you believe some are so negative about frugality?

 

The post Why Would A Person Choose To Live A Frugal Life? appeared first on Making Sense Of Cents.

Source: makingsenseofcents.com

ByCurtis Watts

Cheap Ways to Keep Kids Entertained During Holiday Break

Cheap Ways to Keep Kids Entertained During Holiday Break is a post originally published on: Everything Finance – Everything Finance – Its all about Money!

During the winter, it can be difficult to keep our kids entertained. Depending upon where you live, it can be really hard to entice them to stay outside for any length of time. And during the holiday break, it seems to be even worse because they don’t have school work to keep them distracted. So, we have found some cheap ways to keep kids entertained during the holiday break and the winter. Some of these ideas won’t cost you a penny, while others may cost a tiny bit of money if you don’t already have items to work with.

Volcano Fun!

If you ever went to a school science fair, I am sure you have seen a homemade volcano at least once in your life. While there are plenty of different ways to make a volcano, there is one that I ran across on accident that I prefer.

One of my favorite ways to keep my drains clear is with baking soda and hydrogen peroxide. The two of them create a chemical reaction that burns away all of the gunk that may be stopping up your drains. And when my kids were younger, they loved to watch me do it because it created a really cool effect.

Which gave me the idea to start using just those two ingredients (and sometimes food coloring when I want to get really crazy) to create homemade volcanoes for them. If you have some playdoh lying around, then that and a plate will do the trick for a volcano vessel.

Just have your kids create a volcano out of the playdoh on the plate, or even on an old piece of wood from the yard. Put a couple of spoonfuls of baking soda into the volcano. Add food coloring for effect, if desired. Then take the volcano outside and add baking soda until you start to see a reaction.

We have done this with snow also, and it was pretty cool to watch the eruption change the shape and color of the snow volcano. However you choose to create the volcano, the kids will love it and it shouldn’t cost you anything to create.

Lego Contest

If you are anything like us, then you probably have some Legos lying around somewhere. In fact, we have two huge bins of them, so there is no shortage of Leg’s around here. During the holidays, one of our favorite things to do with the surplus of Legos is to create a Lego contest.

If you have a ton of them, then the contest can get fairly creative and elaborate. And, depending upon the ages of your children, the contest will vary also. However, some of our favorite Lego contests have been:

  • Best Lego house
  • Most elaborate Lego swimming pool
  • Most creative Lego car
  • Craziest Lego family
  • Biggest Lego city
  • Best Lego luxury boat

These are just a few ideas to get you started, so get creative and have fun!

Treasure Hunt

Having a treasure hunt is always a crowd pleaser and is sure to keep kids entertained. Creating a treasure hunt is similar to the Lego contest, in that it can easily be varied based on the ages of your kids and the environment. If it is too cold outside, then you can keep the treasure hunt inside.

I like to create our treasure hunts so that they are both inside and outside, so the kids can get some fresh air. The easiest way to do this is to create a simple map and create clues to where you have hidden the treasure. The treasure can be anything, really. Hiding candy for pretend gold doubloons are always a favorite of our kids. But, you could also hide a deck of cards, a pair of warm fuzzy socks, or a small set of Legos.

I like to try and find things that we have lying around that the kids have forgotten about to hide as treasure. Sometimes I’ll throw a lollipop or piece of candy in the treasure also, for added excitement.

The treasure can be hidden in an old bag or something more elaborate like a plastic pirate treasure chest with a lock. If you use something like this, then they will have to find the key along the way before they get to the treasure. This is a ton of fun!

Make Your Own Games

Making your own games can also be a lot of fun. Especially if you put the kids in charge of making them. We happen to have a couple of artists in our house who love creating and drawing, so this is a great plan for them.

Just give them some blank paper, scissors, and crayons, markers or colored pencils to get started. Then have them create their own Snakes and Ladders, Candy Land or Pin the Tail on the Donkey game. And it doesn’t even have to be a donkey, but any animal they’d like to pin the tail on.

Let them get creative and really work hard to create their own versions of the games. Once they are done, then comes the real fun for everyone. Making and playing these homemade games can keep kids entertained for hours. Which I am a huge fan of!

Obstacle Course

And last, but definitely not least, creating an obstacle course is always a ton of fun. We like to use things such as:

  • Old boards
  • Chairs
  • Buckets
  • Planters
  • Hammock
  • Garden hose
  • Plastic bins
  • Rakes
  • Shovels

Creating an obstacle course is something that we usually prefer to create outside, just so there’s less chance of slamming into walls or furniture. But, it could be created indoors also, if the weather outside simply won’t comply.

Have your kids work on finding the raw materials around the house or yard to create the obstacle course with. Then have them create the obstacle course, which needs to be realistically doable. Then, you can time each kid running the obstacle course to see who the winner is.

After the course has been run a few times, then have the kids rearrange to create a completely different course. This is an activity that can not only keep them busy for hours but help burn out some energy and get them some fresh air. Bonus!


These are some fantastic, cheap ways to keep kids entertained!
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Keep Kids Entertained Summary

When it comes to the holidays and too much free time, there are many ways to keep kids entertained. And they don’t have to cost you very much if any, money. Use what you have at your disposal first, so you don’t have to buy anything extra. So, creating a volcano or an obstacle course might be great first choices. After you’ve tried those, I would suggest having your kids make their own games and a Lego contest, followed up by a massive treasure hunt. No matter which options you choose, your kids are sure to be entertained, which makes everyone’s life much easier.

What ideas do you have to help keep kids entertained during the holidays this year?

Cheap Ways to Keep Kids Entertained During Holiday Break is a post originally published on: Everything Finance – Everything Finance – Its all about Money!

Source: everythingfinanceblog.com

ByCurtis Watts

How Many Credit Cards Should You Have for Good Credit?

Have you ever wondered, "How many credit cards should I have? Is it wise to have a wallet full of them? Does having multiple credit cards hurt my credit score?"

If you’ve been following this blog or the Money Girl podcast, you know the fantastic benefits of having excellent credit. The higher your credit scores, the more money you save on various products and services such as credit cards, lines of credit, car loans, mortgages, and insurance (in most states).

Even if you never borrow money, your credit affects other areas of your financial life.

But even if you never borrow money, your credit affects other areas of your financial life. For instance, having poor credit may cause you to get turned down by a prospective employer or a landlord. It could also increase the security deposits you must pay on utilities such as power, cable, and mobile plans.

Credit cards are one of the best financial tools available to build or maintain excellent credit scores. Today, I'll help you understand how cards boost your credit and the how many credit cards you should have to improve your finances.

Before we answer the question of how many credit cards you should have in your wallet, it's important to talk about using them responsibly so you're increasing instead of tanking your credit score.

5 tips for using credit cards to build credit

  1. Make payments on time (even just the minimum)
  2. Don’t rely on being an authorized user
  3. Never max out cards
  4. Use multiple cards
  5. Keep credit cards active

A common misconception about credit is that if you have no debt you must have good credit. That’s utterly false because having no credit is the same as having bad credit. To have good credit, you must have credit accounts and use them responsibly.

Having no credit is the same as having bad credit.

Here are five tips for using credit cards to build and maintain excellent credit scores.

1. Make payments on time (even just the minimum)

Making timely payments on credit accounts is the most critical factor for your credit scores. Your payment history carries the most weight because it’s an excellent indicator of your financial responsibility and ability to pay what you owe.

Having a credit card allows you to demonstrate your creditworthiness by merely making payments on time, even if you can only pay the minimum. If the card company receives your payment by the statement due date, that builds a history of positive data on your credit reports. 

I recommend paying more than your card’s minimum. Ideally, you should pay off your entire balance every month so you don’t accrue interest charges. If you tend to carry a balance from month-to-month, it’s wise to use a low-interest credit card to reduce the financing charge.

2. Don’t rely on being an authorized user

Many people start using a credit card by becoming an authorized user on someone else’s account, such as a parent’s card. That allows you to use a card without being legally responsible for the debt.

Some credit scoring models ignore data that doesn’t belong to a primary card owner.

Some card companies report a card owner’s transactions to an authorized user’s credit report. That could be an excellent first step for establishing credit … if the card owner makes payments on time. Even so, some credit scoring models ignore data that doesn’t belong to a primary card owner.

Therefore, don’t assume that being an authorized user is a rock-solid approach to building credit. I recommend that you get your own credit cards as soon as you earn income and get approved.

3. Never max out cards

A critical factor that affects your credit scores is how much debt you owe on revolving accounts (such as credit cards and lines of credit) compared to your total available credit limits. It's known as your credit utilization ratio, which gets calculated per account and on your accounts' aggregate total.

A good rule of thumb to improve your credit scores is to keep your utilization ratio below 20%.

Having a low utilization ratio shows that you use credit responsibly by not maxing out your account. A high ratio indicates that you use a lot of credit and could even be in danger of missing a payment soon. A good rule of thumb to improve your credit scores is to keep your utilization ratio below 20%. 

For example, if you have a $1,000 card balance and a $5,000 credit limit, you have a 20% credit utilization ratio. The formula is $1,000 balance / $5,000 credit limit = 0.2 = 20%.

There's a common misconception that it's okay to max out a credit card if you pay it off each month. While paying off your card in full is smart to avoid interest charges, it doesn't guarantee a low utilization ratio. The date your credit card account balance is reported to the nationwide credit agencies typically isn't the same as your statement due date. If your outstanding balance happens to be high on the date it's reported, you'll have a high utilization ratio that will drag down your credit scores.

4. Use multiple cards

If you need more available credit to cut your utilization ratio, there are some easy solutions. One is to apply for an additional credit card, so you spread out charges on multiple cards instead of consistently maxing out one card. That reduces your credit utilization and boosts your credit.

Having the same amount of debt compared to more available credit instantly reduces your utilization and improves your credit.

For example, if you have two credit cards with $500 balances and $5,000 credit limits, you have a 10% credit utilization ratio. The formula is $1,000 balance / $10,000 credit limit = 0.1 = 10%. That’s half the ratio of my previous example for one card.

Another strategy to cut your utilization ratio is to request credit limit increases on one or more of your cards. Having the same amount of debt compared to more available credit instantly reduces your utilization and improves your credit.

5. Keep credit cards active

Credit card companies are in business to make a profit. If you don't use a card for an extended period, they can close your account or cut your credit limit. You may not mind having a card canceled if you haven't been using it, but as I mentioned, a reduction in your credit limit means danger for your credit scores.

A reduction in your credit limit means danger for your credit scores.

No matter if you or a card company cancels one of your revolving credit accounts, it causes your total amount of available credit to shrink, which spikes your utilization ratio. When your utilization goes up, your credit scores can plummet.

Anytime your credit card balances become a higher percentage of your total credit limits, you appear riskier to creditors, even if you aren't. So, keep your cards open and active, especially if you're considering a big purchase, such as a home or car, in the next six months.

In general, I recommend that you charge something small and pay it off in full several times a year, such as once a quarter, to stay active and keep your available credit limit in place.

If you have a card that you don't like because it charges an annual fee or a high APR, don't be afraid to cancel it. Just replace it with another card, ideally before you cancel the first one. That allows you to swap out one credit limit for another and avoid a significant increase in your credit utilization ratio.

If you're determined to have fewer cards, space out your cancellations over time, such as six months or more. 

How many credit cards should you have to build good credit?

Now that you understand how credit cards help you build credit, let's consider how many you need. The optimal number for you depends on various factions, such as how much you charge each month, whether you use rewards, and how responsible you are with credit.

There's no limit to the number of cards you can or should have if you manage all of them responsibly.

According to Experian, 61% of Americans have at least one credit card, and the average person owns four. Having more open revolving credit accounts makes you more likely to have higher credit scores, but only when you manage them responsibly. 

As I mentioned, having more available credit compared to your balances on revolving accounts is a crucial factor in your credit scores. If you continually bump up against a 20% utilization ratio, you likely need an additional card.

You can keep an eye on your credit utilization and other important credit factors with free credit reporting tools such as Credit Karma or Experian.

Also, consider how different credit cards can help you achieve financial goals, such as saving money on everyday purchases you're already making. Many retailers, big box stores, and brands have cards that reward your loyalty with discounts, promotions, and additional services.

If you continually bump up against a 20% utilization ratio, you likely need an additional card.

I use multiple cards based on their benefits and rewards. For instance, I only use my Amazon card to get 5% cashback on Amazon purchases. I have a card with no foreign transaction fees that I use when traveling overseas. And I have a low-interest card that I only use if I plan to carry a balance on a large purchase for a short period.

There's no limit to the number of cards you can or should have. Theoretically, you could have 50 credit cards and still have excellent credit if you manage all of them responsibly.

My recommendation is to have a minimum of two cards so you have a backup if something goes wrong with one of them. Beyond that, have as many as you're comfortable managing and that you believe will benefit your financial life.

Source: quickanddirtytips.com

ByCurtis Watts

How to Budget Groceries: 11 Easy Tips

Have you ever sat down to go over your budget only to find out that you’ve outrageously overspent on food? Local, organic, artisan goods and trendy new restaurant outings with friends make it easy to do. With food being the second highest household expense behind mortgage or rent, our food choices have a huge impact on our budget. Using this monthly budget calculator can also help guide how to budget for food. 

You may be surprised to find out that the most nutrient-dense foods are often the most budget-friendly. It’s not only possible, but fun and easy to eat nourishing, delicious food while still sticking to your budget. Here are 11 ways to help you learn how to budget groceries.

1. Track Current Spending

Before you figure out what you should be spending on food, it’s important to figure out what you are spending on food. Keep grocery store receipts to get a realistic picture of your current spending habits. If you feel inclined, create a spreadsheet to break down your spending by category, including beverages, produce, etc. Once you’ve done this, you can get an idea of where to trim down spending.

2. Allocate a Percentage of Your Income

How much each household spends on food varies based on income level and how many people need to be fed. Consider using a grocery calculator if you’re not sure where to start. While people spent about 30 percent of their income on food in 1950, this percentage has dropped to 9–12 today. Consider allocating 10 percent of your income to food as a starting point, and increase from there if necessary.

3. Avoid Eating Out

This is the least fun tip, we promise. Eating out is a quick and easy way to ruin your food budget. If you’re actively dating or enjoy going out to eat with friends, be sure to factor restaurants into your food budget — and strictly adhere to your limit. Coffee drinkers, consider making your favorite concoctions at home.

4. Plan Your Meals

It’s much easier to stick to a budget when you have a plan. Plus, having a purpose for each grocery item you buy will ensure nothing goes to waste or just sits in your pantry unused. Don’t be afraid of simple salads or meatless Mondays. Not every meal has to be a gourmet, grandiose experience.

5. Keep a Fridge Grocery List

Keep a magnetized grocery list on your fridge so that you can replace items as needed. This ensures you’re buying food you know you’ll eat because you’re already used to buying it. Sticking to a list in the grocery store is an effective way to keep yourself accountable and not spend money on processed or pricey items — there’s no need to take a stroll down the candy aisle if it’s not on the list.

6. Eat Before You Go to the Store

If your mother gave you this advice growing up, she was onto something: according to a survey, shoppers spend an average of 64 percent more when hungry. Sticking to a budget is all about eliminating temptations, so plan to eat beforehand to eliminate tantalizing foods that will cause you to go over-budget.

7. Be Careful with Coupons

50 percent off ketchup is a great deal — unless you don’t need ketchup. Beware of coupons that claim you’ll “save” money. If the item isn’t on your list, you’re not saving at all, but rather spending on something you don’t truly need. This discretion is key to saving money at the grocery store.

8. Embrace the Bulk Section

Not only is the bulk section of your grocery store great for cheap, filling staples, but it’s also the perfect way to discover new foods and bring variety into your diet. Take the time to compare the price of buying pre-packaged goods versus bulk — it’s almost always cheaper to buy in bulk, plus eliminating unnecessary packaging is good for the planet.

Bonus: a diet rich in unprocessed, whole plant foods provides virtually every nutrient, ensuring optimal health and keeping you from spending an excess amount on healthcare costs.

9. Bring Lunch to Work

Picture this: you’re trying to stick to a strict food budget, and one day at work you realize it’s lunchtime and you’re hungry. But alas, you forgot to pack a lunch. All the meal planning and smart shopping in the world won’t solve the work-lunch-dilemma. Brown-bagging your lunch is key to ensuring your food budget is successful. Plus, it can be fun! Think mason jar salads and Thai curry bowls.

10. Love Your Leftovers

Would you ever consider throwing $640 cash into the trash? This is what the average American household does every year — only instead of cash, it’s $640 worth of food that’s wasted. With millions of undernourished people around the globe, throwing away food not only hurts our budget but is a waste of the world’s resources. Tossing food is no joke. Eat your leftovers.

11. Freeze Foods That Are Going Bad

To avoid wasting food, freeze things that look like they’re about to go bad. Fruit that’s past its prime can be frozen and used in smoothies. Make double batches of soups, sauces, and baked goods so you’ll always have an alternative to ordering takeout when you don’t feel like cooking.

Sticking to a food budget takes planning and discipline. While it may not seem fun at first, you’ll likely find that you enjoy cooking and trying a variety of new foods you wouldn’t have thought to use before. Being resourceful and cooking healthfully is a skill that will benefit your wallet and waistline for years to come.

 

Sources: Turbo | Fool | Forbes | Medical Daily | GO Banking Rates | Value Penguin

The post How to Budget Groceries: 11 Easy Tips appeared first on MintLife Blog.

Source: mint.intuit.com