Studies show that the number of households that own two or more cars has increased dramatically over the past 30 years. However, is this a sane financial choice? Should you or shouldn’t you buy a second car? What are the advantages and what are the disadvantages of doing this? If you want to learn more about what owning a second car actually means, make sure to read on:
Making a budget is essential if you want your finances to be in order. However, if you are just at the beginning of your personal finance learning “journey”, you may not know exactly how to create a budget. To help you out, we have gathered some of the best tips on budget-making – so make sure to read on and find out more.
Put in very simple terms, creating a budget is consisted of three main steps: identifying how you spend your money at the moment, setting long term goals for your money spending and making sure you stick to your plan as well. Sure, in theory everything may sound very easy – but most of you are more than familiar with the fact that, well, budgeting is not easy. You will need to keep yourself motivated and you will need to genuinely stick to your plan if you want to achieve your goal. Good news is that it’s more than doable and that you will feel excellent once you have reached your final goal!
Make Sure Your Goal Is Very Concrete
If you want to “win” at the entire budget-making “game”, you should make sure you establish your rules from the very beginning. Setting a very clear, concrete goal is of the utmost importance if you want succeed. For example simply saying that you want to “save money” will not be enough. Set your goal to “save X sum of money for your Y purchase” and you will be much more likely to succeed.
Always Be Realistic
It’s great that you have big plans – and you can succeed for sure! But keep in mind the fact that we are human and that there are things that are simply unrealistic. For instance, if you currently spend $500, dropping your spending to under $100 (for grocery, entertainment and everything else) will be most likely unrealistic. However, making the change more gradually is a perfectly realistic goal and you can achieve it if you really stick to a plan.
Make Good Use of the Software
If you want to make this a bit easier on yourself, make sure you get a software application to help you create, track and stick to your budgeting plan. There are a lot of apps available both for computers and for smartphones (Android, BlackBerry, iOS and so on) and some of them are completely free of charge (especially the ones for smartphones). They will help you keep track of your spending, identify the issues and stick to your goal-achieving plan as well.
Don’t Forget to Include How Much You Owe
Knowing what you have, what you spend and what you make are all very important when creating a budget. However, remind yourself to include your debt as well. If you are like most people, you do owe some kind of debt (student loans, credit cards and so on), so you should take that into consideration first. If your goal is to get rid of your debt, make sure you create your budget around that particular goal.
With the rising prices of petrol, it’s really no wonder why so many people are looking into what options they have when it comes to saving money in this area. The great news is that saving money on your car’s fuel is doable as long as you are truly willing to do this. How to do it? Here are some great hacks you could make use of:
Keep Your Car in Good Condition
Keeping your car properly services is not just about safety (although, obviously, that’s the first and foremost important reason). It can also help you save money on how much gas you use as well. Imbalanced tires, burning oil, loose belts – all of these things can boost your petrol bill as well. Check with your car’s owner’s manual and see when you have to change all these things on your car because it will be more than worth it.
Don’t Fill the Car to the Top
Unless you really, really have to do this, don’t fill your car too much. It will make it heavier and thus, your car will have to pull much more weight than necessarily. Keep in mind that this includes both luggage and people and that you should never push your car beyond its limits. Also, remind yourself that a full tank is very likely to make you want to share the car with more people, but this may not be as great for you if you want to save money on petrol.
Use a GPS
Even if you are very familiar with a road, a GPS will still be useful on those handful of occasions when you cannot find your way. Getting lost means that you will drive for more miles – and it consequently means that your car will use more petrol too. Over the course of time, these miles can add up (and so can the money you spend on your fuel), so investing in a GPS system is a really good idea.
Try to drive in a way that is as consistent as possible – meaning that you should avoid breaking and accelerating too sharply. Doing this usually means that your car has to work harder and it also means that it’s “eating” more fuel too. Even more, driving smoothly is great for the people you transport and for yourself as well, so try to do it as much as you can.
Same as with a large variety of other things in today’s economy, gas prices can vary a lot from one gas station to another. Shopping around and finding the best price can save you quite a lot of money on the long run. For instance, if you find petrol that is 30 cents cheaper in a gas station, this can save you almost $4 only because you chose that particular gas station. And keep in mind that this is for one full tank! Imagine how much you could save in one year! If you decide to do this, you should surely know that there are very useful free apps you can download on your phone (GasBuddy is one of them, but there are others too).
In today’s economy, making money is not easy – but spending it can be much too easy for a lot of us. If you are like the vast majority of the people out there, you will be more than interested to make some extra money. Good news is that you can do it, especially with nowadays’ technology. What are some easy ways to generate a side income? Read on and find out more:
If you can code, type or write, you’re in luck because there are tons of jobs available online for those like you. At first, you may have to charge less so that you can build a portfolio (but if you have one already, you can charge a bit more and you can increase your hourly rate as you go too). You may not be able to make a lot of money this way, but it will be worth it because it will round up your fixed income.
You can make money by offering basic services as well. If you can babysit, clean, remove the snow, walk the dogs or do anything else other people may not have the time to do, you can find a lot of jobs in your “market”.
Have a Hobby? Start Making Money with It!
If you have a hobby, you should know that there are many ways to make money with it. Photographers can make money by offering their service at events and by selling their work online to various stock photo websites and art photography websites too. Furthermore, if you have any other hobby (such as quilting, knitting, painting or anything else), there are many places online where you can sell your creations. For example, Etsy is a fabulous marketplace for those of you who create handmade products.
Become a Direct Selling Agent
There are a lot of companies that function on a direct selling basis (e.g. Avon, but you don’t actually have to stick to the cosmetics industry if you don’t want it). The best thing about being a direct selling agent is that, most of the times, you can sell your products to friends and relatives and you can make an honest side income this way. Each of these companies has its own business model and its own earning scheme, but overall, they all offer reasonable discounts for their selling agents and you can make nice money this way.
Put in very simple terms, passive income means that you work once and earn from it for a long time after you have stopped working. One of the best ways to do this is by building websites or blogs focused on a particular niche and by monetizing them via Amazon’s Affiliate program, via Google AdWords or by allowing eBay to post ads on your website. Every time someone clicks on your site’s ads and buys something, a certain percentage of their purchase comes to you. This will take learning some basic SEO and a bit of patience, but it will eventually pay off.
For the vast majority of the people, buying a car is a relatively large financial move. Therefore, most people will think twice before signing anything with a car deal – and most of them will also think thoroughly on whether they want a new car or a used one. Which is the best option, though? Here are some of the things you may want to know before deciding to buy a new or a used car:
New Cars: Their Pros and Cons
Obviously, buying a new car comes with a lot of benefits. First and foremost, this car was not driven by anyone else, which means that it hasn’t been “mistreated” and that it hasn’t suffered any kind of repairs. Furthermore, buying a new car means that you have much more of a chance to find something that’s truly suitable for you.
Even more, new cars use less fuel and have lower emissions – which means that they are perfect for those of you who are at least somewhat concerned about the environment. In addition to these advantages, a new car also means that you get the best warranty too (and most of the times, most of your repairs will be covered by it).
On the other side of the coin, buying a new car is much more expensive than buying used. Of course, there are many financing options available too – so you can definitely find something to suit your needs. Beware, though! You may feel tempted to buy something that actually exceeds your budget because you will feel that you’re not paying the entire price of the car at once.
Used Cars: Their Pros and Cons
Buying a used car has at least one primary advantage: it can be much cheaper than buying a new car. In some cases, you will not even need to call for the help of the various car financing companies either, as you can save plenty of money to buy a used car.
Furthermore, the fact that a car can depreciate its value quite quickly can also be considered to be an advantage of buying a used car over buying a new one. Since you will not pay a lot of money on the car to begin with, you will not feel sorry when you see it depreciate (and, in general, used cars don’t depreciate as much as new cars).
As for the maintenance costs of the car, this is where the disadvantages start to appear. Although you will most likely get better insurance rates, you will also have to take into consideration the fact that a used car is much more likely to need repairs more often. You might be able to buy warranty from the manufacturer of the car, but even so, it will not cover for everything you need and you will have to take considerable sums of money out of your own pocket every time the car breaks and needs repairs.
Travelling does not have to be expensive. In fact, there are a lot of things you can do to travel cheaply and, sometimes, even for no money at all. For instance, did you know that you can get free flights if you pay attention to certain details?
Following, we have gathered some of the very best tips to help you get free flights for a variety of destinations (including tips on how to use airports to get free flights). Continue reading if you want to find out more about this!
Take Advantage of the Airlines’ Customer Service
Airline companies are far from being perfect. While this can be annoying for anyone who has paid their hard-earned money to purchase a plane ticket, it can also be an advantage to many as well. If you have received bad service at the airport’s gate, if you have encountered any kind of situations where the staff was less than polite or if you have anything to complain about, do it. If it’s a reasonable complaint, if you do this professionally and if you are very specific of the details in which that particular thing happened, it is very likely that you will receive vouchers, discounts and free flights. How come? Airline companies know that they can’t fix everything, so they will be happy to keep their customers close by providing excellent service for them. And if this means offering the occasional free ticket, they will be more than willing to offer it.
Find Crowded Flights
Because a lot of airlines cannot afford buying new planes that are likely to fly half-full, they will very frequently over-sell their tickets. This means that there’s a high chance that you will get bumped if you choose such a ticket. And in this circumstance, the above-mentioned brilliant customer service will come in handy for you because the airline will most likely offer you a free plane ticket. All you have to do is search for flights that are very probable to be over-crowded!
Get Special Credit Cards
Airline credit cards and credit card companies that collaborate with various airlines can be your best friends. Sure, you will not be able to take advantage of the actual airport in order to reap the benefits of such a card – but you will be able to get free plane tickets. The reasoning behind these credit cards is quite simple to understand: the more you spend, the more “miles” or points you will receive – and they can be converted to plane tickets or considerable discounts as well.
Some of these credit cards will automatically provide you with a certain number of miles if you are a new cardholder and, as long as you use the credit card in a responsible and smart way, you can only win from this situation. Definitely worth looking into the option, especially if you plan on travelling to multiple destinations or if you plan on travelling long term!
Going to college can bring you with many benefits – but truth be told, for most of the people out there, it does put a strain on their finances too. Student loans can be tough to pay back mostly because most people who are fresh out of college don’t make enough money to afford being in too much debt. You shouldn’t despair, though. There are ways to pay back your student loans sooner and to live a more stress-free life. Here are some of the most important ones:
Learn What Your Grace Period Is
Most of the times, student loans come with grace periods – and this means that the lender will allow you a certain period of time after you graduate before you start making any payments for your loan. Keep in mind that different types of loans (from different lenders) come with different grace periods – and you should be more than acquainted with what that means in your case.
Make Larger Payments
Treating your student loan as a you would a mortgage is a really great idea if you want to get rid of it as soon as possible. For instance, if you have to make a student loan monthly payment of $250, making it close to 2-3 times more than that can lower the time you need in order to fully pay back your lender. With a bit of determination and attention to how you plan your finances, you could get rid of your student loan in 3 years instead of 10!
Create a Plan
Making a budget plan on 3 to 5 years is a very good idea if you want to avoid stretching your student loan repayment period too much. Calculate how much money you make every year and calculate how much money you would be left with if you were to pay your entire student loan in 2 or 3 years. Make sure you create a budget plan for the money that’s left and to stick to it. This will allow you to make larger payments to your loan, which, as mentioned above, can save you a lot of money (and a lot of time too).
Know Your Repayment Options
If you cannot afford making larger payments for your loan and if you feel that you cannot afford making the actual, obligatory payment either, you should know that you have other options. Discuss with your lender and see if you can extend the time needed for the full repayment. This will lower your monthly repayments, but it will also increase the interest rate – so make sure to take both sides of the coin into consideration before making any kind of decision.
Of course, deciding to extend the repayment period may not be a great idea if you want to save money. However, it is a much better thing to do than to simply allow your loan to default. Default student loans can lead to a lot of trouble (including having your wages stopped and ruining your credit score too).
A car and a house – this is a lot of people’s dream. However, in order to achieve this dream, many people will have to take a loan from a bank or house/car financing institution. While with mortgages everyone can agree that few people can buy a home without taking a loan, car loans are a bit more complicated. Is a car loan good or bad, though? Here are some things you may want to know before you make any kind of decision in this respect:
The short answer to the above-mentioned question is simple: “it depends”. It depends on your income, on why you want to buy a car for and, ultimately it depends on the exact type of car loan you take as well. In the end, it is entirely up to you to tell if a car loan is actually good or actually bad (or even both) for you and for your budget, so make sure to analyse your options thoroughly and to settle on something only when you are certain that it’s the very best solution for you.
Why Are Car Loans Bad?
Let’s start with the bad news: car loans can be bad from a number of points of view. First of all, cars tend to depreciate quite rapidly (even faster than houses, for example – or at least they do under normal economic circumstances). Secondly, car loans’ interest rates can get a bit higher than other types of loans, so you may want to take that into consideration before striking a deal with any kind of car lender (and you should shop around in any way, so that you can get the best deal).
Last, but definitely not least, a car is not that large of a purchase. It can be, of course, especially if you plan on getting a very expensive car. But even with a new car, there are a lot of affordable options. With a bit of planning ahead, you can save yourself tons of money on the long run by simply saving it and not getting a car loan.
Why Are Car Loans Good, Though?
Car loans are not “evil” – they do have their good parts too. For instance, if you live farther away from an economic centre, you will find that getting a car will provide you with the chance to commute to work – and thus, it will increase your odds of finding a better-paid job too.
Even more than that, some of the above-mentioned disadvantages can be dodged as well, especially if you plan carefully. For instance, your car will not depreciate as much if you are ready to invest in a higher end model or in a more recent model. Also, bad interest rates can be avoided too. If you have good credit (and if you have made your payments conscientiously until now, you most likely do), you will very probably get a fairly good interest rate too – and this will help you avoid paying too much over the actual price of your car.
If you are like most families out there, your mortgage is probably one of the heaviest bills you have to pay each month. Good news is that you can save quite a lot of money on your mortgage too. All you need is some know-how, some determination and some attention to detail. Here are some very useful tips on how to save more money on your mortgage so that you can enjoy a more stress-free, happier life:
Very often, banks will create an offset savings account for those who take a mortgage from them. A lot of people don’t actually get to use these savings accounts, but the truth is that they can really save you a lot of money on the long run. By simply using the savings account and transferring some money there every month, you can save yourself months and even years off your mortgage. Even if you add only $50 as an extra every month, you will still be able to take a few months off your mortgage repayment period. Plus, you will have instant access to your savings account whenever you need them, so you will not have to call for desperate measures if, for example, you have to pay for an unexpected, emergency bill.
Call Your Lender
Sometimes, saving money on your mortgage can be as simple as calling your lenders. If you have seen another offer somewhere else and if it’s better than your current mortgage, calling your lender is a very smart choice. Banks and mortgage companies will go to pretty large extents to make sure they keep their clients, so simply calling your bank may get you a better deal on the spot. It may not feel like a lot, but when you calculate the savings over a long period of time (e.g. 30 years), you will see the difference for sure.
Pay Lump Sums Whenever You Get the Chance
Paying a lump sum to your mortgage every once in a while can go a very long way when it comes to shortening your mortgage repayment period. Bonuses, gifts and extra-income can be added to your mortgage as lump sums, which will automatically lower how much you have to pay every month. If you do this as often as possible, you have real chances of lowering your mortgage in a considerable way.
Analyse Your Mortgage Options from the Very Beginning
If you haven’t taken your mortgage just yet (or if you plan in selling your current home and taking a new mortgage for a more affordable one), you should pay a lot of attention to how you choose your mortgage. Analyse all the options out there, the interest rates and all the additional fees too. Furthermore, do take into consideration less conventional ways of getting a mortgage too. For instance, a house seller’s loan will be paid directly to the seller and you have a much better chance of dodging a series of fees and of getting a better interest rate too.
We all make mistakes – after all, it’s completely natural and human. However, when it comes to financial mistakes, making them can be avoided if you pay a bit of attention to how you spend your money. In the long run, this will save you from a lot of trouble, it will help you avoid getting too indebted and it will also help you live a happier, more stress-free life as well.
What are the most common money mistakes you might be making (and many other people too)? Here are five of the most important ones:
1. Spending More than You Make
This will seem like a really obvious thing, but the number 1 reason so many people are struggling with their finances is actually related to the fact that they spend more than they win. This is simplest form of math, the kind you used to learn when you were in second grade – but it definitely goes a very, very long way when it comes to keeping your finances in order (and keeping yourself sane).
2. Not Thinking of Retirement
Sure, you may be 20, 30 or 40 and retirement does seem like a very, very far away thing to deal with. But here’s the good/bad news: it’s not that far away. Decades will pass by in the blink of an eye and it’s much better to start thinking of retirement sooner, rather than later. Take care of your 401(k) account (and this includes not cashing it out), see how you can invest money for retirement in other ways too and be financially responsible about that “far, far future” because your “future self” will definitely thank you for having done this.
3. Not Saving Money
Even a few tens of dollars a month in a piggy bank (or in an actual bank, as you wish) can really save you from a lot of trouble when the rainy days come. Just think of it: unexpected expenses can appear along the way and it will be much more difficult for you to borrow money than to simply take it out of your savings. Even more, calling for the help of the various loans out there can be a really bad financial decision because you will end up paying much more.
4. Not Trying to Make More Money
Having a fixed salary is a great thing, sure. But your earning capacity goes far beyond that. There are hundreds of ways in which you can start a small business at home and boost your monthly income with its help. It does take a bit of extra work and a bit of research, but the extra cash-flow will make you feel that everything is more than worth the trouble – and it is.
5. Not Getting Rid of the Things You Don’t Actually Need
There’s no such thing such as a fixed expense – everything can be adjusted. Make sure to be flexible and to adjust your spending as you move along with your life. Ditch the car if you don’t need it or of you need extra-cash, make sure you pay attention to all the monthly purchases you don’t actually need and you will be much better off in the end.