5 Ways to Become Rich Using These Good Habits
Become Rich With Good, Honest, Hard Work to Start
Become rich, seems impossible. But when you consider the real definition, it is possible. Become Rich is defined as the process of having all that you need and much of what you don’t. The needs include all bills paid monthly, money in the bank, investments, 401k, low-debt, and understanding finance. All of these will put you on the road to become rich.
A surprising number of people don’t have most of what they need, and many who do, have very little excess after bills are paid. To Become Rich understand it begins with hard work and ends with saving money.
Most folks will swear they work hard, including young folks. But, when questioned about tactics common to successful people they fail.
They don’t research the best jobs or work enough hours to get promoted. They are not constantly improving themselves with training and education, they admit to being negligent.
The earlier you start working hard, the more likely you are to achieve financial success and end up with a job you like.
Also, you will have more time to save and accomplish your long-term goals when it comes to paying bills, general savings, and retirement savings.
Work hard when you are young since you have better health and more energy, and time to accomplish life-long goals.
Don’t Over Invest in Education
In today’s educational climate, you can spend $10,000 on college living at home with no student loan debt, or $200,000 going away to college. Going away could leave you with huge student loan balances. You can get the same degree and job with a $200,000 student loan debt as a $10,000 student loan debt.
If you have rich parents who don’t mind paying the larger bill that is fine. But, to take out student loans on the larger college cost makes no financial sense at all.
When you add the emotional toll it will take when you try to pay down huge student loan debt for the next 25 years.
Student Loan Debt
Those large student loan payments are amortized like a mortgage, which makes it even harder since the loan is paid over such a long period of time.
Do your research, know the total cost of all colleges you are considering. List several colleges you or your child is interested in and include the cost of tuition, books, room, and board, and then add 5% for hidden cost.
The more expensive the college is, the more student loan debt you will have to take out. Choose from affordable colleges. Financial aid only covers about 80% of costs for the poorest students, concentrates on scholarships, and family support.
How Many Degrees Are Necessary At Once
So no matter what your financial level, you will always need to come up with some out of pocket money. The exception is if you are covered by a full guaranteed scholarship, but these are rare.
Once you get a marketable degree, concentrate on getting a job after your training, instead of more degrees. Some people get multiple degrees, and therefore, deep in student loan debt.
Later you find out the first college degree was perfectly adequate. Many who make the mistake of choosing a college with too much student loan debt find they spend most of their time figuring out how to get student loan debt under control.
Research Everything, Before You Take Personal Finance Tips
We were taught to do research in college, remember all of those late-night college research papers, but now many of you do what I call the anti-research. The anti-research is when you approach salespeople and ask them what you should buy. Don’t blindly take personal finance tips either.
Salespeople mysteriously suggest the most overstocked item on the shelf since they need to make room for new stock. The most overstocked item may be such, due to high returns or bad reviews also. This is the same with personal finance tips from online, unknown brokers, or friends. Get the facts before you do anything.
Personal Finance Research is Important
Do your research about everything, especially big-ticket items such as cars, homes, home building, mortgages, colleges, and investment companies. Use these personal finance tips to start your finance journey.
I mention investment companies because of Bernie Madoff of Madoff Investments. Madoff was not a registered Investment Advisor most of the time he was in business, but none of his victims checked his credentials at finra.org.
You can start your checking by calling the company you are interested in and asking a lot of questions. Try to get a list of 10 questions, then search government websites to find information on the industry or company in question.
Where to Find Information
Check independent consumer sites for reviews, and lastly, ask those who have used the company or services you are considering.
It is hard to get the truth about some companies because there is so much false information in circulation. But if you do your research you can reasonably be sure you will get most of the truth.
Some buyers make purchases based on a “free-gift seminar”, buying anything based on a free gift is what I call high-risk buying. I call it high-risk because it is usually something you don’t need and the gift is charged back to you with your purchase.
Some buyers even sign long term loan commitments based on a seminar gift and presentation, only to regret it later.
Live Below Your Means
This sounds like it is good old fashion common sense. But one of the biggest reasons for home foreclosures and personal bankruptcies is because many people believe it is ok to live above their means.
Living below your means you will have a much greater chance of keeping your home or car if you get laid off your job or pay decrease. It also means you will have money freed up to save for important things, such as home maintenance, car repairs, and vacations. Keep home foreclosures and personal bankruptcies at a distance before you have trouble with your job.
Make Savings A Bill
You know what happens when you get a bill, you do everything you can to pay that bill, no matter what. Some bills are on automatic deduct, which makes them really easy to pay since you don’t even have to write a check.
Do the same with savings, it is easy when you make “savings a bill”, making it an auto deduct bill. Savings should include; emergency savings, extra to retirement savings, college savings, and vacation savings.
A habit that makes us poor is, every time we need money for emergencies, we borrow the money by charging them on high-interest credit cards. The lowest credit card payment is amortized over a 20 year period. Making “savings a bill” makes saving money easy.
Sometimes it is necessary to use a credit card, like securing a hotel room, renting a car, or getting credit card points. Just keep it within an affordable range, and use them sparingly. Make more than the minimum payment to get the balance paid off quickly. Making savings a bill will increase your savings balance instead of a credit balance.
When you have substantial savings based on monthly additions to a few accounts, emergency, basic needs, vacation, and retirement; you will see yourself on the road to become rich beyond your wildest dreams.
Summary
It is time to become uber conscious about your personal finance using the above personal tips. Understanding what it means to become rich, will enable you to grow your money the right way. You will put your savings on autopilot by making your savings a bill. Home foreclosures and personal bankruptcies will never become a threat. You will know how to keep student loan debt low, and you will have financial peace of mind.
7 Ways To Save Money To Buy A House
Start Saving to Buy a House Now
There are literally thousands of ways to save money to buy a house. With many ways to buy a house, purchasing a home is not as difficult as you may think.
First of all, you must understand that you “can’t have it all,” so discontinue that form of thinking. You must make sacrifices to buy a house and think of it as an investment for life. This should help to motivate you
You must make some sacrifices if you want to save money to buy a house. There are many ways to purchase a home with a number of home buying programs.
You must curtail your spending in other areas. Home prices are up all over the country. But you can still find affordable housing in the way of a cosmetic fixer (that is a fixer with no major repair problems), or a home with an anxious seller.
It takes skill to buy a house, but you can find that in these tips.
To buy a house understand the monthly payment of P+I+T+I, translated, this is the principle, plus interest, plus taxes, plus insurance, which, added together, equal the total monthly payment.
In order to buy a house, you must put down a down payment and pay additional escrow costs. Learn more here.
Understanding the P+I+T+I for different loan amounts will enable you to better prepare for homeownership. For example, if you could afford $1400, the total for a P+I+T+I monthly payment.
Determine what home cost would fall into this price range. Your mortgage broker will assist you.
Search the Internet or anonymously call mortgage companies for quotes. To purchase a home there are home loans that require 0%, 3%, 5%, and 10% down, plus the closing cost. There are many different home buying programs available.
The lower the down payment, the better your credit should be, to get a reasonable interest rate. The standard down payment is about 10% plus escrow and closing costs. It is a good idea to calculate escrow or closing costs upfront.
You will either pay a down payment or points (toward interest rates). The lower the down payment the higher your points to buy a home or vice versa, depending on your home buying program.
Ideas for saving for your new home could include:
1. Selling a car or furniture for the new home buyer
Many of us have an extra car or a car with excessive monthly payments, insurance, and gas. Sell the car you are not using, or in the case of the overly expensive car, sell it to purchase an affordable model.
2. Get a part-time job and save the money as your new home buying check
You can create income for your home purchase. Even if the job is every other weekend, it will help. The money adds up fast, adding an additional $400 a month will end up adding $4800 to your home buying fund.
That amount of money is substantial for a new home buyer in many of today’s markets.
3. Temporarily discontinue a whole host of unnecessary things for serious homebuyers:
Saving money for home buying is a serious endeavor. If you are serious, you will not miss any of the things that bring you immediate joy. You will instead think of the long-term joy you will get as a new homebuyer.
Here is a list of things to discontinue if you are a serious homebuyer. Movies, parties, vacations, clothes, cable TV, voice mail, newspaper, and excess clothes shopping. You can think of more.
4. Use your tax return:
Put your tax return in the bank toward a down payment on your new home. After purchasing your new home, speak with an accountant. Find out how many more exemptions you can take during the year with your new home.
The accountant will tell you how to adjust your exemptions in order to get the money during the year to help with your new home payment if you are over-paying your taxes during the year.
You can use your future excess taxes (or home deduction) toward your current monthly payments.
5. Use a windfall, such as an inheritance or large bonus:
Take this money and place as much as you can afford toward your down payment. There are many unexpected windfalls, everyone has them at various times. Be ready to save your windfall toward buying a house, just in case.
6. A few of you can live with your parents or in-laws while saving money for your homebuying fund:
There are a few parents or in-laws who will be willing to work with you. If you are willing to give your family a low monthly rent, this helps them and you.
That is, if you are not willing to live with them for free it takes a burden off of both of you, and you don’t feel like you are freeloading.
For example, if regular rent is $1200 dollars a month, offer your relative $600 a month and save the additional $600 a month. In a year you would have $7200 to contribute to your homebuying fund.
7. Ask for cash as gifts to add to your homebuying fund:
When you have a birthday, graduation, wedding, or any other celebration, explain to family members in advance that you are saving for a home. Request that you prefer cash gifts.
You can do this over and over and in no time you will have a substantial amount of money to add to your homebuying fund.
Summary
Purchase a home when you understand financing options and costs to buy a house. Your down payment and escrow costs can vary depending on many factors.
There are many ways to save money to buy a house, so don’t be dismayed. There are many home buying programs to assist you in buying a house the right way. Use this information too.
Creating a Sustainable Budget in a Time of Financial Crises
Creating a Sustainable budget is defined as a budget that works to meet all of your short-term and long-term needs. It keeps you feed, clothed, gas in your car, your mortgage or rent current, whether you have a lot of money or times become lean.
To create the lasting sustainable budget you must plan, and do it early. You don’t start when you lose your job, get into a car accident or have any other time of financial crises. Creating a sustainable budget will take care of those issues.
The money you have in good times is budgeted heavily so it will last during bad times. I see too many people who though “caution to the wind”, when it comes to spending. They think they are so special that they will never hit hard times with a job loss, contract loss, or medical emergency.
Don’t be fooled, it happens to folks of all income levels. So, it does not matter if you are low income or uber high income you have budget your money. You never know when the, “well will run dry” or the money will seem to evaporate due to lose of income.
So, let’s get started and create a sustainable budget now. You will create the short-term, the long-term and the budgets for the specific things you need.
The common sense approach to avoiding a time of financial crises during an economic downturn is to guerrilla budget when times are good as well as when times are bad.
Unfortunately, many people don’t think about budgets until finances are in trouble. Start to create your sustainable budget and continue improving it as time goes on.
Chat With MsFinancialSavvy About the Best Ways to Budget Anything
I saw a new story about a young girl, who became a high-income singer, with a contract from a major media company, then came a terrible time of financial crises with an illness. Now her 1.2 million dollar home is being auctioned off. Where did she go wrong? Is she any different than most Americans in her position?
The answer is 1. Apparently she did not understand how to budget the money she earned, 2. She didn’t understand the limits of the money she earned. 3. She didn’t understand that, no matter what your income emergencies happen. 4. She did not create a sustainable home buying budget based on worse case scenarios.
The answer to the second question above is, NO, she is not any different than most Americans, and did not anticipate a financial crises.
Budgeting is not taught in most high schools and colleges or graduate school. Because of that we even have PHD’s and MD’s (doctor of philosophy and medical doctors), going broke due of mismanagement of money or the lack of budgeting skills.
They don’t understand that a financial crises can happen to anyone, so creating a sustainable budget early will prevent problems.
In this article I will give you a few quick tips to creating a sustainable budget using my guerrilla budget method:
1. Live below your means no matter what your financial status to create a sustainable budget.
This sounds like common sense, but many who have common sense and a good income don’t, because you feel money will make up for it.
It does not. Ask all of the broke entertainers who once made millions. The 8 cars, and the 8000 square foot house is only a distant dream.
They think about how they could have purchased 3 nice cars, and a 3000 square foot house, put money in savings, invested aggressively, and they would have been set when the entertainment contracts dried up.
Many get caught in something as simple as not paying required yearly taxes. Pay your taxes first, then pay yourself in savings and investing, then pay your other affordable bills.
2. When you make a lot or are awarded a lot of money
When you enter into a high income or windfall pretend like it has to last you 100 years.
The is a good trick for those who don’t have a lot of self-discipline, it works because you trick your mind into believing the money does not exist, so you are forced to guerrilla budget it.
When you are distracted one day you open your savings and investment account and you realize you did something really smart. You created a sum of money you can actually live off as your business or income falls on hard times.
3. Be conservative with your purchases
There is no law that says when times are good you should waste money. The problems come when you have not grown up with financial discipline; too many income earners do.
Don’t fall in the trap of, “I have to spend big to have quality products”. You don’t. You can get nice clothes, shoes, cars, homes, and education at a very affordable cost and high quality.
Some things that are very expensive, you will later find that you simply spent too much money and could have gotten the item for a fraction of the cost.
Do your homework, do lots of research and get the best item for the best price. This is a major step to creating a sustainable budget.
4. Buy a home and car with a monthly note you can afford
You do not have to max out your monthly income in “monthly bill payments”. That is that your entire paycheck goes to “monthly bill payments”.
Here are examples; Why not buy the certified pre-owned car with a monthly note of one-third of the new car? Put the remaining two-thirds in a couple of different savings and/or investment accounts.
If you lose your job, you can pull from one of those accounts to continue your payments until you get another job.
5. Decide what you can afford based on your income and future
Start with a written budget. Your budget should include cost to run your home (maintenance-rent or mortgage), food – clothes – medicine. Also include things such as getting to work and maintaining a car, going on vacation, and to save, save, save for now and the future.
Everyone has different needs. It is imperative to identify all of your needs you have now or may have in the future. This is an analysis that will take time to figure out.
6. If you have an addiction to expensive “things” work on that problem
That is the number two problem that causes poverty with people who make a lot of money. The number one problem, is “budgeting ignorance”.
If you have an entertainment contract that last three years, spend like it will last three years.When you are an independent contractor on a job that will last two years, live like it is only two years.
When you are self-employed don’t fail to get proper liability insurance, health insurance and all insurance that is required by your industry. For those who are self-employed with an office space lease make sure you understand your lease by talking to a business attorney, before you sign.
The general idea here is to get cosst under control, understand that you don’t need expensive things.
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7. If you work on a contract like the singer above probably did
You have to be especially careful with spending because you will have a big tax bill at the end of every year based on your big income (quarterly after the first year).
When you are an independent contractor of any type – self-employed, contracted worker or any other; you will need to pay taxes by quarter and then year-end.
The worse thing to do is to file too many exemptions so you can have extra money in your paycheck. You promise yourself that you will pay it back, and of course that doesn’t happen. Eventually, you get into a nightmare loop of owing taxes, making payments and getting future behind.
8. Remember that it takes a long time to create a sustainable budget
-Because you have to consider cost that you normally don’t think about.
-You have to consider all timelines for payments.
-Then don’t forget things you may need in the future.
-You can get a simple short-term budget, but a long term budget is ultimately the most important.
-When you do all of the above you creat a guerrilla budget
Go here to understand creating a sustainable budget of your dreams.
Lois Center-Shabazz | Course Delta Agency
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5 Frequently Asked Questions About Mutual Funds For Women
Frequently asked questions about mutual funds
I have given a lot of lectures about mutual funds for women. I like mutual funds because, if you do your research you can purchase low-cost and low-risk mutual funds on your own. Mutual funds are easy to understand and invest in. You can do it yourself once you have done some research. Here are five of about twenty-five of my most frequently asked questions about mutual funds by women I lectured to. After a few decades of successfully investing in mutual funds, I felt it is only fair that I share my expertise with you.
- ARE MY MUTUAL FUND INVESTMENTS GUARANTEED AT ALL?
Insurance is provided by the SIPC, which covers fraud. In other words, if you invest your money in company “C”, a registered investment company (registration with finra should be checked), and it is stolen by the President of Company “C”, you will be covered for up to $500,000 for each account, depending on the circumstances. Example: If a husband and wife have a joint account it is covered up to $500,000, if the each have additional retirement accounts in their separate names, the retirement accounts each are covered up to $500,000. Here is the SIPC insurance breakdown.
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WHAT ARE THE ADVANTAGES OF INVESTING IN A MUTUAL FUND?
With a mutual fund you will get professional management, diversification, an affordable investment, and it is liquid. This is one of the main reasons that I encourage investors to invest in mutual funds, after reading my frequently ask questions about mutual funds. It only takes a little research and study to master mutual funds, but because there is a learning curve I encourage you to master them first.
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WHAT ARE THE DISADVANTAGES OF INVESTING IN A MUTUAL FUND?
You still have costs even when returns are negative, you don’t control the investments totally, you don’t know for sure if the price will go up after you purchase – but after research you can verify that you are getting a quality mutual fund where there is a good chance the price will rise in the future. If you invest on your own you can keep cost low and more money will go to you, but if you go with a broker, you will be required to pay brokers fees which are sometimes hidden and costly.
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YOU CAN EARN MONEY FROM YOUR MUTUAL FUND IN THREE WAYS
Dividend Payments — A fund may earn income in the form of dividends and interest on the securities in its portfolio. The fund then pays its shareholders nearly all of the income (minus disclosed expenses) it has earned in the form of dividends.
Capital Gains Distributions — The price of the securities a fund owns may increase. When a fund sells a security that has increased in price, the fund has a capital gain. At the end of the year, most funds distribute these capital gains (minus any capital losses) to investors. Most mutual funds pay money into your mutual fund account yearly, a few pay on a quarterly basis. This means if you pull your money from your mutual fund that pays out capital gains and dividends at years end, you will lose your profits. So, be patient, and know your payout date.
Compounded Returns – unlike simple interest accounts the interest on top of the dividends and capital gains will compound year after year, giving you compounded interest.
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WHAT IS THE NAV OF MY MUTUAL FUND
Increased NAV (Net Asset Value) — If the market value of a fund’s portfolio increases (from dividends and capital gains), and after deduction of expenses and liabilities, then the value (NAV) of the fund and its shares increases. The higher NAV reflects the higher value of your investment. The more the NAV increases, the more money your investment will be worth. The NAV value can fluctuate from month to month or year to year, the important point to look at is that it has a net increase over time.
You have two choices:
Let someone else manage your money and end up with little or nothing OR learn some simple basic rules that could turn a little into a lot over time. I provide you with all the help you need in my eBook on Mutual Funds. I even give a 30-minute free clarification session after you read this article. The eBook I have written is clear and concise, after you finish it you will understand how to efficiently invest in mutual funds.
Lois Center-Shabazz | Course Delta Agency
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3 Tips For Big Thing Budgeting for Groceries
Budgeting for groceries seems like a simple task. Make a list and buy what you need. Well, it usually doesn’t happen that way. If you are not precise about shopping, the list will be meaningless, and you will end up spending more money than you need to. Shopping the right way can save you thousands of dollars every year. Here is a short list of quick things you can do for big thing budgeting for groceries.
YOUR SHOPPING LIST
1. Shopping with a list is important, but the list must be well thought-out. You should decide what your menu will be for the week, comparison shop for groceries by using prices online or in your weekly sales paper.
It is best to use your list to shop the isles for grocery shopping is much less expensive than the end of isles, where new products are often displayed.
Shop within the confines of a menu. Know exactly how many pieces of fruits, vegetables, meat packages, loaves of bread, box of cereal etc. Know what you will pay for each item and stay within a strict budget.
BUY, PREPARE AND EAT IN A FEW DAYS
2. Buy and prepare only as much as you can eat within a few days. Food waste is a big reason for going over budget with your grocery bill. Clean your refrigerator at least once a month to closely monitor food use. It is even better to clean and monitor your refrigerator once a week if you have time.
Keep your refrigerator and cupboards well organized so food is used on a timely basis. Concentrate on fresh foods to prepare, not junk food or food that is already prepared.
SHOPPING WITH COUPONS WILL HELP
3. Coupons will help if you buy items you need. In other words, don’t use coupons to purchase items just because they are on discount. The next money saver is the sales paper and prices online. Another option is extreme couponing if you have time.
The savings comes at the cash register, when you have product for weeks, and when you sell product that is in excess. Buying in bulk also saves money on food, but you have to calculate your savings, it doesn’t always work. Shop with a calculator.
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BE VIGILANT ABOUT SHOPPING FOR GROCERIES
Being vigilant about shopping and budgeting for groceries will make a big difference in your grocery bill. The savings can be enormous if you shop the right way.
Shop when you are calm and hopefully you are not bothered by kids sneaking expensive groceries into the cart. When you follow these simple guidelines budgeting for groceries and saving money will become easy.
Get organized with your budgeting by using my award-winning BUDGET PLANNER, WITH THE COMPRENSIVE FANTASTIC FINANCES COURSE.
Lois Center-Shabazz | Course Delta Agency
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7 Steps of Budget Planning to Avoid Financial Disasters
Budgeting Planning to Avoid Financial Disasters
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The First Step of Budget Planning to Avoid Financial Disasters
Budget planning to avoid financial disasters starts with not buying too big with the big stuff such as cars and homes is one of the biggest reasons many cannot withstand a small business or personal financial disaster.
Many of us forget that there are affordable ways to buy homes and cars to avoid future financial disasters. What happens, is that these two items are based on way too much emotional buying. Keep your head on straight by researching before you purchase. Learn more on my instagram.
Ask questions like; Do I really need a new car? What will the warranty maintenance cost on my new car? What if I purchase the same car 3-4 years old, what would the savings be?
If you have a job, no matter how secure you think you are, that security could be in jeopardy at any time. So, purchasing a car that you can buy cash or with very low payments will be the better option.
The same holds true with a home, if it is too large, with a stressful payment, the smaller home with the lower payment, that carries less stress may be a better option.
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Stay Properly Insured
The second step to budget planning to avoid financial disasters seems to be plain old common sense. But, sometimes people with a home and car let important insurances lapse due to illness or thinking they don’t have the time, they let important insurance lapse, due to simple negligence.
Stay fully insured with a car, home, health, life, and if you own a business – all applicable business insurance. A small business lawsuit should always be covered with business liability insurance, not your personal assets – so, don’t take the chance.
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Don’t Waste When Times are Good and Income is High
We have had many economic downturns and upturns in the past several decades. The one regret I have heard a lot when I talk to people who make a lot of money when times are good is — “I lost my mind when I had a lot of money, and spent without regard to the reality to the future, then a financial disaster came”.
Because nothing is guaranteed, even good times, it is important to handle your money as if the money will stop anytime, that will help protect your assets.
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Let Your Kids know Money Doesn’t Grow on Trees
There are some parents who, despite much evidence to the contrary, feel it is important their kids need to have all the material trapping they did not have. It is not necessary, and it is not true.
Your kids will literally begin to think that money grows on trees and drops from the sky. Your kids know you love them when you give them positive time and attention, so it is not necessary to spoil them, and it may lead to a financial disaster.
You can reward them without giving them too much, some parents to the tune of going bankrupt. At this point your kids probably are not aware of potential financial disasters, but at least you can start to teach them money skills.
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Have a Sick Fund for Days Not Covered by Extended Illness
Most jobs have sick leave, most small businesses have no sick leave unless they create it themselves. As an employee, you may run out of sick leave if you have an extended illness. Save money in a sick fund to cover an extended illness. This is especially important for small business owners.
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Make Your Savings a Bill
Create a general savings fund and treat it like a bill. You are probably seeing a pattern here. Saving money as several bills is just as important as paying existing bills. It should be a part of a general budget plan for financial disasters.
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Don’t Borrow From Your 401k, Borrow From Your General Savings
As far as I am concerned, borrowing from a 401k is a budget planning financial disaster unless you are suffering from a fatal illness, borrowing from your 401k should not be a consideration.
You should have an automatic saving account for financial disasters that you can borrow from.
The 7 steps of budget planning to avoid financial disasters will above will get you on the way to solid financial success.
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Lois Center-Shabazz| Money Strategist | Course Delta Agency
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7 Tips for a Budgeting Basic Bounce
Budgeting basic bounce may be defined as follows. Ever heard the expression, “I don’t know where my money goes” another is, “I don’t have the things I need and can’t afford any of the things I want”.
If this is a problem you have, you may want to look at your budgeting basic skills. And read this budgeting advice, paying close attention to the process of creating your optimal budget, and then sticking to it.
1. Start With the Essentials
Your budgeting basic bounce should include your essentials to start with. You must have a home, food, and water, at a minimum to exist. So, those are the things you should budget for and pay off, first.
A) Rent, Food, Utilities, Car Payment (if you must have a car for work)
A Budgeting Basic Bounce Can Take Your Budget Over the Top --Lois
If you don’t pay for insurance your car can be impounded and your home would not be replaced if it is destroyed by fire. So of course insurance is an essential budgeting basic skill. You could lose your credit rating if you don’t have car insurance and an accident is your fault.
The other person’s insurance company can charge you with the payout and lien your credit. In most, if not all states liability car insurance is the law.
B) Homeowners insurance, or Renters insurance, and Car insurance
If you become ill, could lose your home and assets to a hospital lien? Possibly. To prevent this, you must have health insurance always as a budgeting basic bounce.
If you do not have health insurance, in most cases a hospital will treat you and charge the bill to you, with collection calls to pay up, until you satisfy your bill.
C) Health Insurance
If you have loved ones, that is children or a spouse who will need help with bill paying and life maintenance in the event of an untimely death, you should have life insurance, it can be an inexpensive policy, but it is wise to have something.
D) Life Insurance is a budgeting basic skill
2. Make Your Hierarchy
Make a hierarchy of your most important to least important needs. Make a list of the most important to the least important budgeting basic items you pay monthly.
Try to pay the top 3-6 items, no matter what, even in the event of a financial emergency, and the bottom 3 that can be temporarily eliminated in a dire emergency.
Slay Your Finances Like Your Life Depended on It With Budgeting Basic Skills, --Lois
3. Your Savings Please
You will have unexpected expenses from time to time, so an emergency savings may cover those expenses, it will also be your cushion for your top three monthly expenses.
Make this savings account a bill that is taken from your checking account or your check monthly so you don’t have to stress paying saving it. Even if it is only $50 per month, start saving now, it adds up. If you can afford more, put in more.
4. Filling in Gaps
Fill in gaps for your quarterly, semi-annual, and yearly items. Some of your expenses will be quarterly, some may be twice yearly, and others once a year.
Create savings for these items, pull the money out monthly to fund these irregular accounts when they come due. When the item comes up, take the money from this account, instead of from your monthly pay- check.
5. Maintenance Savings Budget
A second emergency account should be for general maintenance. This is a big item that throws off many budgets. Instead of borrowing money for a car or home repair, borrow it from your maintenance savings budget. This saving account could also include your vacation savings.
6. Your Peace of mind
Every time you think of going off your budget, think about the peace of mind you will get from having a balanced budget, paying your major bills with ease every month, and having extra to cover unforeseen expenses.
Your strict organization is the key to a great budget, this is a general organizational plan. You will create a specific plan for your budget, allow this plan to be your guide.
7. Get Help With Your Budget, Don’t do it Blindly
Pick up your free personal finance gifts now, track your spending and plug holes in your budget for extra money toward expenses or savings. Use the simple but powerful, Budget Plan to guerrilla plan your budget with an extreme organization now.
In summary: Only you can put that budgeting basic bounce in your budget if you go from top to bottom with an analysis. Understand the essential such as rent, food, homeowners, renters insurance and health insurance. Then is you have dependents – life insurance.
Make a hierarchy of the most important to the least important budget items.
Get your savings in order and fill in the gaps for quarterly or yearly payments.
Now enjoy your peace of mind with your wonderful budgeting basic bounce and new found budgeting basic skills. If you don’t understand how to create the best budget for you, get help.
Lois Center-Shabazz| Money Strategist | Course Delta Agency
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Big Thing Budgeting in 7 Ways
How to Budget for the big things, use what I call Big Thing Budgeting.
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USE BIG THING BUDGETING TO GET OUT OF A MOUNTAIN DEBT: CREDIT CARDS, MEDICAL BILLS, PREDATORY LENDING
For Individuals, Couples and Small Businesses, you can get out of a mountain of debt if you focus like a laser beam on getting debt-free. It is not easy, but it is possible.
It will first require that you stop buying anything you don’t need. Get rid of the “I Got to Have it Syndrome”.
Start by keeping a log and inventory of your buying habits. Then slowly start to purge spending you don’t need to do. When you take an inventory of your buying habits, you will be surprised at the amount of unnecessary buying you do.
Second, you must start paying off one thing at a time in a big way but pay on other bills at the same time. Start with the smaller bills, pay extra to those bills with the most you can afford, then pay a small amount extra to principle to your other bills — at the same time.
Big Thing Budgeting Shaves Thousands Off Your Budget -Lois
You will see bills drop off one by one. Now, for the larger bills, you may have to start selling things you don’t need. From cars to yard sells, is where you can sell things you don’t need.
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BUDGET TO BUY A CAR
Save money for your next car while your current car is in good shape. Then, research the cost of the car you are interested in. Set a budget, then go through the internet and your local newspaper to see prices and figure out monthly payments, if you plan to finance. If you don’t plan to finance, you will see how much you need to save and for how long, to pay cash.
Consider buying a certified used car at a new car dealer or a one-year-old car from a new car rental agency. Make sure you know the new car prices and options on a new car so you can compare it to a new-used car with options.
Use Kelly blue book or kbb.com, to check for cars that are good for buying as used cars. You can also check for general pricing of new and used cars.
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BUDGET TO BUY A HOME
Home buying requires doing a lot of research to discover 1. how much you can afford to pay for a home, 2. how to find a good mortgage company, bank, or credit union. The best place to start is your local credit union or bank due to the savings in fees, cost and time. 3. How to buy a quality home, and 4. How to get it properly inspected – some inspectors work for the realtors, so many won’t tell you when you the home you are interested in has major problems.
Therefore, it is best to contact tradesmen directly, like electricians, plumbers, roofers, and carpenters to get a fair assessment of possible home repairs. Most of them will do an inspection in their specific area for a small fee.
Use at least 2 of each kind, so you can get a consensus as to what is wrong. You can then budget for the down payment and escrow cost to purchase your next home.
Therefore, it is best to contact tradesmen directly, like electricians, plumbers, roofers, and carpenters to get a fair assessment of possible home repairs.
There is a Right Way and a Wrong Way to Buy Cars, Homes, and Education -Lois
Most of them will do an inspection in their specific area for a small fee. Use at least 2 of each kind, so you can get a consensus as to what is wrong. You can then budget for the down payment and escrow cost to purchase your next home.
Make sure you know exactly what your payment will be in regards to your loan. What will your payment be with Principle+Interest+Insurance+Taxes? You can also do mockups of an imaginary home to calculate what you should pay.
Ask friends or family what they pay for insurance and taxes for a home you are interested in. Taxes vary from state to state, you can also search your state websites. In some states, taxes go up as home values increase, but in others, the taxes stay the same.
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BUDGET FOR VACATION
Don’t put your vacation on a credit card when you can save a little all year and pay cash for your vacation. It is as simple as that. Budget in transportation, food, lodging, tours, and shopping.
If you want to go on the cheap, vacation where you have family members or friends who live in or nearby vacation spot. Pay your family member to stay with them, or cover their restaurant costs and meals. Do the math, and see what works out.
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BUDGET FOR COLLEGE
Some people are obsessed with the “best college syndrome” due to the college propaganda machine.
If you have unlimited money, you can go where you want. But, if you must depend on financial aid, which usually includes substantial student loans, that is not an option. If there is one thing you want to keep as low as possible, is student loans.
Since there is 1. never a guarantee you will get a job in your field or keep it, 2. There is not a guarantee you will get a job that pays in accordance with your student loan 3. you can’t file bankruptcy on student loans.
Because of these items 1-3, you should keep student loans as low as humanly possible. That means avoiding high priced schools and high-priced areas to live in for college. The least expensive schools are community colleges, and state colleges and universities.
There are some colleges that are priced like state colleges and universities, but you must do your homework and compare all cost. Private colleges and universities are unreasonably high cost and they have a lot of hidden costs, which makes the total difficult to calculate.
The for-profit schools offer quick learning and high prices. Today, some of them are now calling themselves non-profit due to the unpopularity of the for-profit model.
Private colleges and universities are unreasonably high cost and they have a lot of hidden costs, which makes the total difficult to calculate. The for-profit schools offer quick learning and high prices. Today, some of them are now calling themselves non-profit due to the unpopularity of the for-profit model.
The for-profit schools do massive advertising on television and the internet, this is your main clue. All colleges and universities have their cost listed on their websites. Make sure you find these costs and know exactly what you are getting into before you consider any college.
Your total student loan balance should not surpass your first years’ salary. Example: If you plan to be a teacher and your first year’s income is $25,000, your student loan should be capped at $20,000. Understand the details of student loans with the eBook on student loans.
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BUDGET TO PAY OFF STUDENT LOANS
There ae people all over Pinterest bragging that they paid off $60,000 of student loans in 5 years. This is possible due to re-amortization. When a loan is amortized to 20 years by your loan servicer, you can amortize it to 10 years by paying extra to principle every month.
If you have a 10-year loan, you can knock it down to 5 years. You can live tight, give up the finer things in life, and knock down those years with extra payment to principle.
You have to check your statements to make sure the extra payment is added to principle and you have to state that on your check, they will always try to put the extra to interest, even though it makes no sense. Big Thing Budgeting is essential when it comes to student loans, if not done correctly, these loans can follow you to your grave.
You have to check your statements to make sure the extra payment is added to principle and you have to state that on your check, they will always try to put the extra to interest, even though it makes no sense. Big Thing Budgeting is essential when it comes to student loans, if not done correctly, these loans can follow you to your grave. Learn more on my instagram.
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PREDATORY LENDING
Understand the way predatory lending works such as car title loans and payday loans. Why are many cars confiscated with a car title loan? Why do payday loan balances go from $500 To $3500?
I would have to write another article for an explanation, but a car title loan can easily double or triple if the money isn’t paid on the date due repeatedly, and a payday loan gets a rollover when the employee does not have the money to repay the loan on time.
Both problems push the balance way up over the top. The most effective way to pay off these loans is to stay away from predatory loans. Using predatory lending is probably the direct opposite of using Big Thing Budgeting, don’t get caught in the predatory lending trap. Predatory lending also includes car title loans, unsubsidized student loans and high interest car loans.
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Lois Center-Shabazz | Course Delta Agency
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How a Budget Can Create Financial Freedom in 5 Ways
Financial Freedom
Know Where Your Finances Are First
Since the most important aspect of financial freedom is no or low debt, I will start with debt.
There are those who are in horrific debt and they don’t know it, as high debt is a major robber baron of financial freedom – it is important to understand it’s implications. The main reason is because they don’t know what high debt is.
They have somehow gotten the wrong message about money and debt. They feel the more debt they have, the more money they have. Well, I am here to tell you that the more debt you have, is simply the more debt you have.
If you don’t have enough money to pay your debts every month, that is a sign that you have too much debt for your income. If you are making your debt payments, but it is difficult to pay your debts, you still have too much debt, and need to find ways of getting your debt down.
Low debt is one of the five major factors credit reporting agencies use to determine a high credit score. A high credit score is important because it saves you money when you get loans. The better your credit score, the lower the interest will be on your loans, in some cases, you may not get a loan at all, if your credit score is too low. One way to start down the road to financial freedom is creating a scripted budget.
Write 5 Steps to Getting What You Need to Start a Scripted Budget
Write down the most important things you need immediately. Then, write down the things you need long term. Examples of immediate things you need may be 1. pay off student loans in 3-5 years, 2. purchasing an affordable car after paying off student loans, 3. saving for an affordable vacation after doing number 1 and 2.
Then you will concentrate on long term goals, like finding a higher paying job after you get experience or getting an apartment or home in a better neighborhood.
Write 5 Steps to Getting What You Want in a Different Scripted Budget
Write down what you want short term, but is not necessary. Then ask yourself if you really want it and what feeling you will have if you get it. Then write down a budget and stick to that budget for everything you want.
It is imperative to create and stick to a budget with your wants, since wants sometimes to become emotional and emotions create an easy window to overspend. Example of wants are 1. a new dress for you cousins wedding, 2. going out of town for the weekend by plane to a friend’s graduation etc.
Use the Top Three Steps from Your Budget Scripts to Meet Your Goals
Of the five steps, you write down for both needs and wants, focus on the top 3 on each list. Focus on those top steps with laser precision. Narrowing your focus to the top three and the top 1 on your list will make it easy to make your goals in your time frame.
It will also make it easier to do. Many times, people give up because they feel the task is too hard, this comes when the task feels too overwhelming, the focus will relieve you of the overwhelm feeling.
Every Month Analyze Your Steps and Decide What You Need to Change in Your Budget
Somethings you do will work well, some won’t work at all, and as you use your current list you will also find better ways of meeting your goals. Because of this, you will change your steps by rearranging them or rewriting them.
Look at this article as one of many lessons in financial freedom, the more conscious you are about your budget, the more likely you will achieve financial freedom in the future. If you feel you have financial freedom now and you don’t live within scripted steps, as recommended, it would be wise to start so you can remain financially free.
Media propaganda to buy products we don’t need confuses people into thinking they need them, they buy them, then they get deeply in debt. Don’t allow yourself to be defined by product propaganda, but instead use conscious scripts to achieve low debt.
Use these eBooks to get started right on the road to financial freedom.
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Lois Center-Shabazz | Course Delta Agency
Author, Blogger, Course Creator, Investor, and Money Strategist
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Your 7-Year-Old Child’s Budget
If a 7-year-old has a great child’s budget, will that make him a frugal adult? It may, and it may not. But, we do have lots of evidence to suggest that spoiled children often become over spending and greedy adults. What happens at 7 could easily happen at 70, since good and bad habits grow over time, so why not start growing good habits with a child’s budget early.
Psychologist say the earlier you teach someone a skill the better chance they will perfect it overtime. That is seen in teaching skills such as music, sports and education. In my humble opinion, that also works with budgeting skills.
Some folks can’t figure out why their kids constantly beg for everything in sight, then they look back at the fact that they did not set proper limits on spending early. They felt that a happy child was a child that had everything they wanted, until of course, the child hit their teens and then twenties, and their begging for “things” and spending money developed into out of control behavior.
Here are 3 things you can do to put your 7-year-old on the right path for life.
- Give him an allowance, a piggy bank and chores to begin his child’s budget
Some parents think children should not be paid for the chores they do around the house. I am of the camp that feels there is nothing wrong with giving a child an allowance for working around the house if it is in line with age and chores.
The child does their chores on a schedule, they are paid on a schedule and they are encouraged to save a portion of their allowance and budget the remainder. It teaches them early that we all must work for money, and money has a limit.
- Discuss value, which is the pinnacle of a child’s budget
Some products appear cheap, but they will not last after the first usage or wash. So, teach them there is a difference between expensive, cheap and value for a product. You can purchase a product that appears cheap, but has very low value because it is made with low quality materials or craftsmanship, and quickly falls apart and becomes useless.
An example is buying a computer that is very inexpensive but it only last for 3 years, versus paying slightly more, say 30% more for a computer that last for 12 years — the savings is obvious. On the other hand, you can purchase an extremely expensive car, the upkeep is extremely expensive, and the breakdowns are frequent. That car may look good and go fast, but has little value for practical use and longevity. The maintenance cost out way the looks and performance.
- Teach your child about budgeting, savings and costs to round out your child’s budget
The earlier a child understands what a budget is, how to budget out the total sum of the money they receive, and how cost effects their savings, the better they will be in the future.
Sit down and decide with your child what is important for them, you can look at the internet or newspapers and find the prices of items they are interested in. Inform them that prices change from time to time, but this will give them an idea of what they must save. Allow them to set short term savings goals – a sports item like a basketball or doll, and a long-term savings goal like a more expensive game.
When you buy their more expensive items like bicycles, ATF’s, computers, and clothes, use this time to also discuss value, longevity, and cost.
Using steps 1,2, and 3 will allow your child to start early to process a functional child’s budget, so they can take budgeting into their adult life as an expert.
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Lois Center-Shabazz | Course Delta Agency
Personal Finance: Author, Blogger, Course Creator, Money Strategist
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Personal Finances Should be Personal
Your Personal Finances
I was speaking at a women’s meeting about personal finances and a young woman, about 35 came up to me and ask me what are “personal finances”. I was really shocked since being there meant that she was in some way affiliated with a business she owned.
She looked me in the eye with a very serious face. I pointed to her and said “your – personal – finances”. Your finances that you take very personal. You monitor, you manage, and constantly improve your finances yourself, even if you have help. It’s crucial that you understand your own finances.
It seems like it would be common sense to understand the term personal finance. But, the definition seems to elude some of the most intelligent, and highly successful people. The proof is in the finances of many.
The workplace embezzlements of high-level employees, the bankruptcies of high-income people, the general personal finance mismanagement of people which becomes evident when they lose a job and lose all or most of their assets due to mismanagement.
I CAN SUM IT UP IN 3 WAYS:
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RANDOM SPENDING
Take your finances serious – don’t randomly spend money. This is the most important aspect of personal finances. Some folks act as though the money they have in their checking account belongs to someone else, so they spend it until it is gone or before all bills are paid.
Then they go to the credit cards, when those run out, they go to others to borrow money and make up the difference. Then they lose relationships, which is can be more serious than wasting their money.
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TRACKING YOUR SPENDING
Keeping track of your spending is getting very personal with your finances. Most people don’t understand how fast money goes when it is spent randomly. You can see this also when you charge on credit cards the balance escalates rapidly.
A major aspect of getting personal finance maintenance is paying cash as much as possible unless you use a credit card for points and you have the money and discipline to pay off the balance once a month. With frequent credit card use, many tend to lose track of spending, and their finances become very impersonal.
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BUDGETING YOUR MONEY
I talk to people all the time who tell me they thought they were budgeting until they read many of my budgeting articles and the advice I give on budgeting. My program includes guerrilla budgeting.
With all the distractions, we have – advertising – expensive products – overpriced cars and high maintenance homes- getting personal with your finances means that you must create a guerrilla budget to survive no matter what your income.
Some folks think all they must do is make more money until they find out they spend more for things and get more expenses, so they are either in the same place or worse financially, as income goes up. They realize the problem is they did not get personal with their finances.
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Lois Center-Shabazz | Course Delta Agency
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5 Retirement Tips for your Retirement Planning Young and Old
5 Retirement Tips That Make Retirement Planning a Serious Issue
Retirement tips are for those who never think that retirement day will come, or don’t know the potential difficulties they face when they retire. It always seems so far away, but those who have retired tell me it came faster than they ever imagined.
Here are some actual examples of problems seniors tell me they’ve had because they didn’t take their retirement date seriously in their 20’s, 30’s or 40’s. Here are 5 retirement tips to include in your retirement planning.
Retirement tips #1 – Medicare + 20%
Medicare pays 80% of most of the senior medical cost. Because of this, senior citizens are required to take out a Medicare Supplement policy. The supplement pays the extra 20%. Some seniors planned so poorly that they can’t afford or pay for the Medicare supplement. Because they have no supplement insurance, they are required to pay the 20% each time they go to the doctor, have surgery, chemotherapy or any other medical treatment. If they have a home, the home will be attached to pay for their medical balances, usually if they sell it or pass away. If they don’t have an insurance supplement or pay the 20%, some medical facilities will not treat them. There are two types of medicare: Regular Medicare (government sponsored) and Medicare Advantage (private coverage). Regular medicare typically pre-authorizes and pays promptly. Medicare advantage includes
many “extras” to “induce” seniors to sign up, but does not authorize major
treatment in many cases, and does not follow through with the extras. Doctors I talk to recommend seniors sign up for regular medicare.
Retirement tips #2 – Social Security as a Supplement
Many employees, both young and old, can pay into a 401k plan but opt-out of it, because either they, 1. Don’t understand what it is, 2. Don’t get matched by their employer, or 3. Feel they have plenty of time to worry about it later. The fact is there are numerous articles to explain 401k plans, the match is a nice side benefit—but you still get a tax benefit when you contribute without a match. The amount of a monthly social security retirement check is small compared to your working retirement income. Because of this, social security is meant to be a supplement to your retirement, so think hard about creating your main retirement now. The earlier you start, the easier it is, and the less you need to put into your account, monthly.
Retirement tips #3 – 401k Protection
A popular retirement supplemental plan is the 401k, but you must protect it. Once you start to fund a 401k protect it with all your might. The protections include; 1. Leaving it alone for retirement – this means no borrowing. This is a provision that should not be allowed in a 401k plan since it is meant for retirement. Everything should be done to avoid borrowing from your 401k, including careful planning early in your career. Here are some protection ideas. Make yourself several “would if” scenarios and fulfill those scenarios early.
The examples are — “what if I lose my job”, “what if I need a large home repair”, “what if I want to go on a nice vacation”, “what if I have difficulty paying my mortgage”. All those issues can be addressed by 1. Creating savings accounts, 2. Cutting your living expenses now, 3. Make all major purchases affordable. You can come up with more solutions. The point is to come up with solutions to problems that don’t exist yet, so you never need to borrow against your 401k plan later.
Another protection is to keep your 401k balance to yourself. Scam artist prey on older people and sometimes younger people who have large 401k balances, because they know you can take that money out of your account anytime. A large lump sum withdrawal will trigger a large tax bill if you take it out at once. But, that is no concern of any sales person (many of whom are fake), when it comes to your 401k. You should be the only one who knows the balance. It’s not a good idea to share your balance with strangers.
The popular show, American Greed profiled the case of two ladies, not very old, but managed to retire with large 401k type accounts. One had $600,000 and one had $1 million. Both told friends, who told a fake investment person, who contacted them, talked them into investing with him, and he stole all their money. Their primary problem was that they should never have met with or believed in a stranger who claimed to be investing in the music production business with high returns.
The only thing they got was a huge bill from the IRS since they took the money out within a short period. The man went to prison, but they did not get their money back. Friends, family, and strangers have no right to the information in your 401k or 403b plan. Some elderly people have had their 401k stolen from them by their own relatives, including greedy children.
Retirement tips #4 – 403b Protections
The 403b is like the 401k, usually for non-profits. Fund the accounts, make sure you understand where to keep the money when you retire, you will have a few options. But, mostly understand that your balance is your personal business, and you must pay taxes on the amount you take out. The purpose of your 401k or 403b is to supplement a pension or other retirement plan.
Retirement tip #5 – Tax Shelter Annuity Movement
Many school districts offer tax shelter annuities as supplemental retirement accounts. After retirement, they are offered the right to roll over into an annuity outside their job. Be careful, make sure the costs aren’t prohibitive. Also, you can only take out a little at a time, otherwise taxes would be too high. Again, your tax shelter annuity balance is your business, no one else’s. Look at online investment banks such as fidelity.com, troweprice.com, schwab.com or others – call and discuss low cost annuities to roll over your annuity. You can also discuss other low risk options. Take your time and don’t allow anyone to pressure you.
This is only the beginning, but if you take these retirement tips serious, and include them in your retirement planning, you will be on the road to retirement bliss. Understand the limits of social security when you plan your retirement.
Lois Center-Shabazz
Personal Finance: Author | Blogger | Course Creator | Money Strategist
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