How Does Credit Card Spending Get Out of Hand?
1) Spend more than you make each month.
A. Don't spend more than you are able to pay off each month.
2) Credit cards allow you to pre spend your future paychecks.
A. Set a cap on your credit card spending each month.
3) High limits allow us to charge more than we should spend.
A. Be disciplined and set your own limits that you do not want to go above. Some banks have high spending emails for your credit cards that you can set up through your on line bank account.
4) Store credit cards normally have a higher interest rate than non-store credit cards.
A. Try not to use the store credit card if there is a possibility that you will not pay it off by the due date.
5) Carrying a balance.
A. Do not charge on a credit card if a past due amount is on the credit card.
Thursday, May 14, 2009
Wednesday, May 13, 2009
Reduce, Reduce, Reduce
When we are younger, we have small bank accounts and small areas to store things. When we get older, our bank accounts hopefully grow and our storage areas increase.
Our need to have possessions unfortunately can overwhelm us. Our computers are maxed out of space, our credit cards could be maxed out and our homes are maxed out. Did you ever feel calmer in a hotel room rather than your own home? Look around the hotel room. You have no work to do and no clutter to clean.
Now imagine your home / room how you want it. What do you need to accomplish that goal? If your stuff = headache, get rid of the stuff. What is your weakness? Retaining books, gifts received but not used, stationary, computer equipment or toys. If you went to the store, would you rebuy the items you have now?
As you reach the end of spring, take the time to let some things go. Whether it is the picture frame that needs repairing, the tv that is outdated or your favorite pillow that you already replaced.
Our need to have possessions unfortunately can overwhelm us. Our computers are maxed out of space, our credit cards could be maxed out and our homes are maxed out. Did you ever feel calmer in a hotel room rather than your own home? Look around the hotel room. You have no work to do and no clutter to clean.
Now imagine your home / room how you want it. What do you need to accomplish that goal? If your stuff = headache, get rid of the stuff. What is your weakness? Retaining books, gifts received but not used, stationary, computer equipment or toys. If you went to the store, would you rebuy the items you have now?
As you reach the end of spring, take the time to let some things go. Whether it is the picture frame that needs repairing, the tv that is outdated or your favorite pillow that you already replaced.
Friday, May 1, 2009
Buyers Remorse
I don't have a lot of buyers remorse for items that I purchase. Upon cleaning out most of my receipts in my wallet I realized that part of my family and myself walked into or went to the drive thru at over 22 restaurants in February, March and April. How is that possible? Most were probably when we were out and needed to get something to eat.
I thought of another approach to cure the hungers or munchies. Rather than visit the restaurant, why not visit the grocery store. For $22, I purchased snacks for 16 people. The items were juice boxes, packages of peanut butter crackers and apple slices. You can also brown bag these items so the children feel like they are getting fast food.
Restaurants are expensive. Not to mention paying 15 to 20% on top of the already expensive meals. With a little planning and possibly research you can go to kids eat free places on the correct days and have bagged lunches ready to go for the entire family.
Incase any one is wondering the receipts for the restaurants totaled $300!
I thought of another approach to cure the hungers or munchies. Rather than visit the restaurant, why not visit the grocery store. For $22, I purchased snacks for 16 people. The items were juice boxes, packages of peanut butter crackers and apple slices. You can also brown bag these items so the children feel like they are getting fast food.
Restaurants are expensive. Not to mention paying 15 to 20% on top of the already expensive meals. With a little planning and possibly research you can go to kids eat free places on the correct days and have bagged lunches ready to go for the entire family.
Incase any one is wondering the receipts for the restaurants totaled $300!
Effective Way to Prevent an Impulse Buy
Let's assume you were going to a department store for a certain list of items. You thought about what was in the store and composed your list. Something catches your eye. You resist. Something else catches your eye. Obviously we can't put blinders on in the store but that item is a need. You just did not know that you needed it prior to entering the store. That is the key. The item that you did not need prior to entering the store now you suddenly need.
Sometimes you will make the purchase and sometimes you won't. The rational that even though this item appears to be a need; you had no idea that you needed it prior to entering the store. "It is probably a want." Maybe you could adjust your list to fit it by not buying another item. If you do that you might not have really needed the other item if you were so ready to give up purchasing a listed item. So cross off that item and skip the want posing as a need.
Sometimes you will make the purchase and sometimes you won't. The rational that even though this item appears to be a need; you had no idea that you needed it prior to entering the store. "It is probably a want." Maybe you could adjust your list to fit it by not buying another item. If you do that you might not have really needed the other item if you were so ready to give up purchasing a listed item. So cross off that item and skip the want posing as a need.
Tuesday, April 28, 2009
Saving for Something
If you are saving for something; do you tend to spend less?
Back in May 2005, we financed / leased two new automobiles. We were told to pay these off within 3 years (lease) and within 5 years (purchase). Soon after I found an article on doing snow ball payments. The idea was that within 7 1/2 years you could pay off all of your debts including your mortgage. We tightened our belt straps and started on our journey.
By applying 10% of our take home income per month to our shortest debt we paid off the lease portion on one car. Then we applied the extra 10% to our financed auto, plus the payment that we used to make to the lease company. By March 2007, we paid off our auto and rec. our title.
In most circles we would be considered debt free but I "still" consider a mortgage a debt. Our next step was to apply the 10%, lease payment and the car finance payment to the house.
May 2008 we needed to make another auto buying decision. The result was a used car and no financing.
Back in May 2005, we financed / leased two new automobiles. We were told to pay these off within 3 years (lease) and within 5 years (purchase). Soon after I found an article on doing snow ball payments. The idea was that within 7 1/2 years you could pay off all of your debts including your mortgage. We tightened our belt straps and started on our journey.
By applying 10% of our take home income per month to our shortest debt we paid off the lease portion on one car. Then we applied the extra 10% to our financed auto, plus the payment that we used to make to the lease company. By March 2007, we paid off our auto and rec. our title.
In most circles we would be considered debt free but I "still" consider a mortgage a debt. Our next step was to apply the 10%, lease payment and the car finance payment to the house.
May 2008 we needed to make another auto buying decision. The result was a used car and no financing.
Thursday, April 23, 2009
Needs vs. Wants vs. Emergencies
A lot of times we buy replacement items but how often do we actually buy an item before it is needed? A printer could be showing some signs of wear and it will soon find itself out at the curb. An air mattress could spring a leak and see a similar fate. Would you need to replace a printer and an air mattress right away? Possibly.
Does that turn a purchase into an emergency purchase? What happens when your purchase becomes an emergency? You may pay top dollar and you might not get the exact item that you want.
A friend's parents evaluated how long items were supposed to last and started shopping / researching before "the emergency" occurred.
Can you live without a printer, an air mattress or even a lamp until you have time to get the best deal? PREPARE before the emergency occurs.
Does that turn a purchase into an emergency purchase? What happens when your purchase becomes an emergency? You may pay top dollar and you might not get the exact item that you want.
A friend's parents evaluated how long items were supposed to last and started shopping / researching before "the emergency" occurred.
Can you live without a printer, an air mattress or even a lamp until you have time to get the best deal? PREPARE before the emergency occurs.
Saturday, April 18, 2009
How To Prevent Impulse Buys
1) stay at home
2) shop on a full stomach
3) bring a list
a) pair down the list prior to going into the store
4) write down all purchases when putting into a cart if going in for a couple of items (such as at a drug store)
5) write down the prices and add them up prior to going to the cash register
6) You have heard of trigger foods ... Do you have any trigger stores or malls where "stuff" just pops into your cart
7) price items at two or three places prior to making a significant purchase
8)set a dollar amount that you want to spend at the store or stores and reduce that by 5 or 10%
9) allow for a certain amount of impulse buys per trip
10)keep a list of things that you need; evaluate at a later date to see if you still need the items, add new items to the list and cross out items that you can do without
11) imagine a place in your house for the item
12) Do you really need the item or just want it?
2) shop on a full stomach
3) bring a list
a) pair down the list prior to going into the store
4) write down all purchases when putting into a cart if going in for a couple of items (such as at a drug store)
5) write down the prices and add them up prior to going to the cash register
6) You have heard of trigger foods ... Do you have any trigger stores or malls where "stuff" just pops into your cart
7) price items at two or three places prior to making a significant purchase
8)set a dollar amount that you want to spend at the store or stores and reduce that by 5 or 10%
9) allow for a certain amount of impulse buys per trip
10)keep a list of things that you need; evaluate at a later date to see if you still need the items, add new items to the list and cross out items that you can do without
11) imagine a place in your house for the item
12) Do you really need the item or just want it?
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