Category Archives: Money

Planning For Every Expense

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Making a budget for a home business start-up is more of an art than it is a science. No matter how exactly you think you've pinned down all your expenses, it's guaranteed that more will appear that you either didn't think of or just couldn't have predicted. That's why you need to make sure that you always plan for every possible expense.

Things Break.

Remember that any equipment you buy can go wrong, no matter how expensive or high-quality it was (this is especially true of anything IT-related!) When things break, you probably won't need to buy a new one, but you'll at least have to wait for the manufacturer to replace what broke. This can lead to days of lost or less-efficient business, and cost you money. Budget for equipment failures.

People are Unpredictable.

When you hire staff, you have no way of knowing that they aren't going to let you down. You might have worked out that it takes $200 to train one new staff member, but what do you do when that newly-trained staff member quits and moves to France after three weeks at the job? You've got no choice but to train someone else and take the loss. Budget for staff turnover.

The World is Against You.

Or at least it can sometimes feel that way. Just when you've got everything perfect, someone sets up a little construction site next door, and drives your business away. Or maybe it rains for a few weeks, meaning that there's just no demand for your bouncy castle hire business. Whatever, you need to budget for times when you've got no customers -- and make sure you have something else to be getting on with in the meantime.

Customers are Out to Get You.

'The customer is always right', right? Well, yes, but their 'rightness' can sure cost you a lot of money. You have to be prepared to take huge losses to pay off complaining customers. Remember that one unhappy customer can undo hundreds of dollars worth of marketing efforts -- once you make a customer unhappy, your options are to take a loss fixing the situation or to take an even bigger loss when they tell everyone how you didn't. The only way to avoid this expense is to please all of the people all of the time, which just isn't possible. Budget for unhappy customers.

Competitors Kick You When You're Down.

If one of your competitors spots a good opportunity to take some business from you, they won't hesitate. You need to have a 'war chest' ready to make aggressive offers and marketing efforts, and be prepared to get into a full-scale price and advertising war with the competition. It's massively frustrating to be in a position where your rivals are getting all your business simply because you already used up your marketing money for this month. Budget for war.

Double Your Budget.

Whatever happens, remember that under-budgeting is the worst mistake you can make. It's known as 'under-capitalisation', and is generally thought of as one of the quickest ways to kill a business -- anyone who might be willing to give you finance will just think you're a fool if you've under-capitalised your business, and might even refuse to lend to you.

Most home businesses budget only a few thousand dollars for their expenses (if they even make a budget), thinking that they already have everything they need. People don't realise how quickly little costs like having some business cards made or getting your suit dry-cleaned start to add up. This doesn't apply for other kinds of business, but if you're like 99% of home business starters, you really ought to double your budget. If you doubt me, start adding up all your 'little' expenses over a year, and see what happens.

Budgeting for every expense in your initial plans shows that you're not the kind of person who thinks that everything's going to go right for them just because they're so great -- instead, you're a practical businessperson who knows that anything that could go wrong probably will, and you plan to make a profit anyway. There is a difference, after all, between arrogance and cool-headed determination, and it's one that the people with the money want to see.

Money Management 101

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Managing your money is a big task. But if you want to get by in this world, it's something you have to do. It can be too painful for some, so it gets avoided. But for the people who realize it, the pain/reward relationship is well worth the trouble to spend a few minutes managing your money.

After all, money makes the world go 'round, so make sure you get your share! And the good news is: it's as easy as controlling what you've got!

Here's what you need to make sure that you have control over your financial situation. Here are some valuable budgeting techniques to guide you in your expenses and income.

The first thing you want to do is make sure that you pay for your utilities on time and in full every month. Don't wait until it's too late to pay them. The second thing you need to do is make sure that you don't have too many credit cards. Only a few credit cards are necessary to get by in life. You should consider cutting up the rest of them. And the third thing you should do you, if your bills have gotten the best of you, is to consolidate them into a single loan. This will enable you to pay them off over time without getting slammed with high interest rates.

Finally, establish a budget for yourself. This seems difficult and that's why most people don't do it. And because people don't have a budget they find themselves in financial straits.

The easiest way to establish a budget is to take a draw a line down the middle of a piece of paper. On the left, write down your after tax household income. Be sure to write down the after tax amount as you want to measure available income only. After all, you don't get to spend the before tax amount, right?

In the right column, list an average of each monthly bill. But you should also include your typical spending habits as well, like eating out, or impulse shopping. Don't forget to include paying off your credit card as part of the bills!

Now that you have a list of income and expenses, see if there's a way to increase your income, or reduce your expenses. Usually you'll find a way to do a little to both.

While it seems so simplistic, so few people do it. And yet, creating a budget and sticking to it often separates the successful people from everyone else. What's stopping you from doing it right now?

Minimize Disruption Of Personal Finances After Natural Disasters

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With the recent increase of incapacitating natural disasters, it's vital to prepare now for what might happen down the road. The best way to avoid a major disruption in your financial life after a disaster is to automate critical transactions that are currently done on paper. With tornado season from April through June, hurricane and typhoon season from June through November and the potential for earthquakes at any time during the year, there is no time like the present to ensure that you will have access to your money and personal documents in case of emergency. The following are five things you can do now to prepare for the next natural disaster:

1. Sign up for Direct Deposit of your paycheck or Social Security benefit. One of the major problems in the aftermath of Hurricane Katrina was that people paid by checks had no access to their money. On the other hand, people paid through Direct Deposit were paid on time automatically. If your employer doesn't offer Direct Deposit, send them to the business section of www.electronicpay ments.org to see the benefits of offering the service, not only to their employees, but also to the bottom line of the company.

2. Consider online banking so that you have access to your account records if your paper records are destroyed and/or if your bank branch is not accessible. In the aftermath of a disaster, phone lines, cell towers and businesses could be shut down for months while online access to your bank accounts will be virtually uninterrupted by the natural disaster.

3. Ensure that your insurance premiums, car payments, mortgage and other important bills are paid automatically even if you don't have access to the mail or to your checkbook. Sign up with your billers for Direct Payment. Your bills are paid automatically each month, so you are assured that you will have insurance when you need it and that your car and house payments will remain in good standing.

4. Make a photocopy of everything in your wallet, scan the copies into your computer and save them on a disk. Keep the disk with your preparedness supplies. This takes 15 minutes to do and will save you if your wallet and financial records are destroyed or stolen. In case of power outage, also keep a paper copy of these records in a safe place like a bank vault. It's vitally important to have this information if you need to cancel credit cards, have proof of identification and insurance coverage.

5. Get an ATM card or Checkcard even if you only plan to use it in an emergency. In a disaster, cash is king with some retailers, at least for the short term. If you need immediate supplies, you will want to have access to cash through an ATM. In the days after a disaster, it can be virtually impossible to cash a check or to find retailers whose credit card systems are working.

Should I Save Mad Money For A Rainy Day?

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Yes, this is a good idea! I know you want to know what is mad money? Well, a long time ago this term came about when a young lady went out with her friend to a party and her friend left her at the party with no way home. So, the young lady was mad with her friend that left her at the party and luckily for her, she had money stowed away in her shoe to take a cab back home. She thought to herself on her way home in the cab, that it was good that her mother had taught her to always have money set aside for emergency situations such as this!

Thank goodness, this young lady had the forethought to stash her mad money away so she could take a cab back home, since her friend left her in a lurch. Get the point? Having an emergency fund whether it be mad money or saved money is important for you to have. You say, how do I go about doing this? Well, you can read these tips to help you learn what you can do:

1) Set up a savings account specifically for your emergency fund or mad money fund. Whatever you want to call it, just establish one!

2) Deposit a certain amount of money on a weekly, biweekly, or monthly basis in your account. You may want to set up automatic deposits to your account via your payroll department. Or, you may want to have your bank automatically withdraw a certain amount of money from your checking account into your emergency or mad money savings account.

3) Try to save at least 2-3 months of your monthly salary to cover your bills for at least three months if you were to loose your job. This amount of time will hopefully allow you the cushion you need until you secure new employment.

4) The money you save in your emergency or mad money account should be used for household emergencies, personal emergencies or if you're no longer able to work. Don't use it for other expenditures such as bills, travel, etc... Get the idea? It's a savings account that you don't want to touch unless it's absolutely necessary!

5) Make sure the bank account you put your emergency or mad money into, is paying you the most interest you can earn for this account! Research as many sources as possible on securing the best interest rate you can get. Check with your bank, the internet, newspaper and other sources for the prevailing interest rate. You want to make sure your money can be accessed easily and quickly if you need it for an emergency!

By establishing an emergency or mad money fund, this will give you a better peace of mind if you need access to money when there is an emergency in your life. So, the sooner you start setting money aside for a rainy day, the better off you will be! Make sure the amount of money you contribute to your emergency or mad money fund, is realistic for your budget. Save as much as you can without upsetting your overall personal or family finances. So go ahead, get started today!

I Want To Catch Up on My Retirement Planning What Should I Do?

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Good question and even better, you're thinking in the right direction about your future which is someday retiring. If you're one of those people who haven't saved any or very much money for your retirement, it's never too late for you to start now! It's important that you do start and soon. It doesn't take long for age to slip up on you fast if you know what I mean! So, just get started on your retirement planning now while you're thinking about it. You may want to consider some of these tips and information to get you started:

1) If the employer you are working for offers a 401K plan wherein you contribute a percentage of your earnings towards retirement, consider signing up for this plan! In most instances, the employer may match a percentage of the contributions you make to your 401K account. Your contributions can be made on a pre-tax basis which will help your money grow faster in your account.

2) You may want to consider taking a second job to add more income for your retirement. This will assist you in increasing the amount of money for your retirement fund. If you're able to fit a second job into your schedule, make sure this would be feasible for you and your family without causing problems.

3) Save more of your money by cutting back on some of your expenses. You may want to reduce the number of times you eat out, go to the movies, shop, and any other areas you can cut back on to save towards your retirement.

4) Consider saving your change! That's right, save your change. You would be surprised at the amount of money you can accumulate in a small amount of time by saving your change. Your change could be set aside for your retirement fund. So, start putting your coins away for your future!

5) Reduce or eliminate your spending on your credit cards. The less you pay on your credit cards, the more money you'll have to save towards your retirement. So, if you can pay cash for that item you need to purchase, do that instead of charging it to your credit card. You'll not only save yourself interest charges, but, you'll have extra money to put away for your retirement.

6) If you have a home and are using it as a cash machine or atm by taking out your home equity via loans or a credit line, stop what you're doing! Your home is one of your largest investments and will most likely be a retirement vehicle for you. You'll either want to have your home paid off prior to retirement or be in a position to sell your home to obtain the equity to use as retirement income. If you have your home equity tapped out, then you will not be in the position during your golden years to enjoy your retirement. You'll probably be still paying a mortgage that you may not be able to afford and will not have much money in your retirement fund.

It's better late than never when it comes to starting your retirement planning. So, go ahead, start working on catching up with your retirement planning today, you'll be glad you did!

 

Money managing basics

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Human beings are scaling new heights in almost all the spheres of life. The work that used to consume good amount of time earlier can now be comfortably finished within a few seconds. There are several parameters to evaluate human progress, money management through software being one amongst these.

The software has more than a dozen advantages. The easy and instant record maintenance of the cash inflow and outflow, error free, user friendly, and convenient to operate even for those who have petite knowledge of accounts etc. to name a few. Keeping the innumerable merits and significance of money management software in today's lives, there are different packages available in the market. But you get only what you spend for. For instance if you just aim at a checkbook operator, your package will be confined to maintaining or updating your checkbooks and nothing else. While if you desire the added functions like investment planning and retirement solutions, you ought to pay some more. So there are different features that vary with the cost of the package. However, some of the simple packages may not be attuned to various banking and financial planning websites.

The needs and so the kind of software package to go for varies from individual to individual. Some of the significant and widely used packages or features in high demand are listed below:

Financial Planner Basics

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What is financial planning, and why it is crucial for you.

Even if you do not think you are a financial planner, you better start thinking like one fast. In the United States, there is an approximate of 5.6 million people who are either self-made millionaires or financially independent. And what is so hard to believe about that statistic, you ask? This is because that is only about 5% of the American population.

The remaining 95% of the American population (we're talking about 106.4 million people here!) are not only not rich, but most of them are facing financial disasters, either owing to poor financial planning or foolish spending!. This is why you should start thinking like a financial planner. Financial planning is not so complicated, and it can make a huge difference in your life.

As the saying goes, "failing to plan is planning to fail". Much of the same can be said if you do not plan your finances well, it does not matter if you are a high earner, you still need financial planner skills, to keep you form harms way and to ensure that your life will be financially secured.

The fact of the matter is that financial planning Is Not An Option, most of us need to think ahead today, and you should practice your financial planner skills right away to enjoy the money you make today in the future.

The basics of financial planning is to keep all your finance in order, this is very basic advice, alright. However, more often than not, we would rather concentrate on other things in life such as health, studies, work and more.

Think about the things you want to achieve in life, and how you are going to get there, financial planner always set his goals and puts some order in his thought before starting to actually put the wheels in motion. Financial planning can include buying a house, paying for your children education and thinking about a retirement fund.

Financial planning will help you use your current pay check and your saving to start working on a program that will give you peace of mind on the financial level, a financial planner will plan a budget according to every household's expenditure budgeted and a savings plan drawn up, this will help you spend your money wisely and effectively.

A financial planner will consider having savings invested in an investment vehicle that pays higher returns than the normal bank account, it will add in some muscle to your savings and help you reach your financial goals in a shorter period of time.

By starting your retirement planning now (not later!), you can gauge how much money you will need to maintain your current lifestyle and where this money will come from. Many people, especially those who have just started working, always put their retirement planning on the back burner for reasons such as "I just started work" and "Oh, I am still young".

Many, however, fail to realize that by starting early to save for retirement, you will be able to save and invest more due to the magic of "compounding interest", provided that you invest your savings wisely. Maybe you do not have to wait until the age of 65 to retire. For all you know, by the age of 40, you might have already reached your financial independence and do not have to worry about getting up early to clock in or work until late hours because there are deadlines to meet.

 

Multiple Streams Of Income Are Key To Staying Afloat

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In today's society it is practically impossible to stay on top of bills, increasing gas prices and extraneous financial obligations with just one job. What's more, it is becoming increasingly scary to rely on one stream of income because the economy is so shaky. Who knows when that one lifeline will falter? Many people are discovering that the way to stay afloat in today's rapidly fluctuating market is by using multiple streams of income. This simply means drawing funding from various venues.

One venue that many people find convenient to their schedules and their lives is taking part in an Internet business. Since lots of people are only using their Internet businesses as one of several streams of income, they only do it on a part time basis. There are lots of opportunities on the Internet to earn multiple streams of income, including starting an ebay business, taking part in an affiliate program, making contacts for freelance work, and writing and selling an ebook. The flexibility of working a business on the Internet is valuable for many people who also work other jobs, and especially for those with loved ones who need to be taken care of.

Other off-the-web venues that people use as multiple streams of income include real estate, starting a small independently owned business, mail and phone-based freelance work, and childcare. Many of these businesses are owned and operated out of people's homes, which is time effective for people who are multi-tasking.

If you are planning on using multiple streams of income to stay on top of your growing pile of bills, remember that it is important to think about your personal needs as well. Make sure that you still have enough time to sleep, eat, and spend quality time with loved ones. Time efficiency is very important, so think about cutting down on commuting by multi-tasking from home, or by commuting only to one job. Though more complicated than relying on one job alone, using multiple streams of income can be an effective way to ensure your financial stability.

How You And Your Partner Should Save Money

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Most newly-married couples are having a hard time adjusting to a different way of life, especially when it comes to financial matters. As separate individuals, your spending habits will differ. This is why you both need to make certain adjustments to combine the household budget.

Here are some ways on how you and your partner can make the 'financial aspect' of your marriage harmonious and organized:

1. Understand the way that you both look at money.

If you and your spouse have different beliefs when it comes to money matters, sit down and discuss it. The key here is to be able to compromise. For some people, money is a security measure that needs to be saved. Other people spend it luxuriously and look at spending money as a means to reward themselves for their work. Still, other people are very thrifty that they hardly ever spend a cent of what they have earned.

Understand that the way that you both treat and spend money stems from how you were brought up by your parents. Think of everything that you need to discuss when it comes to your household budget. If possible, set rules on how you will spend your combined income on utility bills, food, mortgage, car maintenance, etc.

2. Set future financial goals.

If you are newly weds and you are planning to have a baby soon, consider this when organizing your finances. If you are a couple nearing the age of retirement, you can make plans on where you will spend your leisure years. Setting long-term and short-term goals will help you finalize your financial plans.

3. Share your money-saving skills with your partner.

If you have different family backgrounds, then you would have something to contribute towards organizing your joints assets. Make each other aware of your personal finances then think of ways on how you can further boost your money-handling tactics.

By following these tips, you will surely have your finances organized to lead a more comfortable lifestyle.

How to Control Your Expenses to Eliminate Debt

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This sounds simple, but to control your expenses you first must understand what they are. The only way to be sure you know what you spend is to record everything. This is hard to do. Then you will need to do something even more difficult, Sacrifice and Live on a Budget.Ouch, all people including you and me hate those two words. But it will take sacrifice to get out of debt. The good news is that it will be worth it.

Every time you make a sacrifice and stay on budget you will be investing in your future. Always keep that in mind. Every step you make towards getting out of debt means you are closer to having your money work for you.

The major expenses you can control on a day to day budget are:
General Expenses It could be music equipment, car washes, computer games, anything. Any things you can figure out which are not your needs. Maybe there isn't anything you can think of, but there probably is. Maybe at least once a month, when you go to buy something on impulse, you force yourself not to do it.

<>Food Expenses Stop going out to eat. This will be a huge sacrifice for most, but you have to stop going out to eat;it's too expensive. You need to bring your lunch to work and, if you have a Starbuck's addiction, stop buying $2 cups of coffee. Many people can save $50 a month just by brewing their own coffee, another $100 by bringing their lunch to work, and another $200 by not going out to eat for dinner.

Clothing Expenses Always decide what you are going to purchase before you go into the store and stick to it. Do all your "shopping" at home. If you truly need a new jacket because the old one has a hole in it and it's really cold outside then you can go get a jacket. But don't start looking around for the skirts and hats while you are there. Get the jacket and run!

Entertainment Expenses You like to have fun and you need to have fun. However, if you are in debt then, you need to sacrifice at least one major entertainment expense a month. Whatever it is you like to do (movies, concerts, plays, out to eat, sports, etc.) you need to reduce the frequency by at least once a month.

Gasoline Expenses As everyone is aware,gas prices have grown astronomically in recent times. For many years gas prices had been relatively level and it seems that they are making up ground ina short period of time. At $3 and more per gallon, gasoline has become a major expense for most households and needs to be specially addressed when looking at ways to control expenses. Getting a car with a good gas mileage and reduce your total driving miles can save you some significant amount of money. If you have colleagues leave close to you, then get them to carpool with you and share the gasoline expenses.

If you follow some basic rules on each of these tips on reducing debt and budgeting expenses and are willing to sacrifice you can save a good significant amount of money each month. That will put a dent in your credit card debt in no time.