Finance Advice
Money Mess: Personal Finance Advice
It’s not too tough to realize when your personal finances have spiraled out of control, especially if bill collectors are calling you all hours of the day and your electricity is shut off because you haven’t paid your bill in a couple of months. What about the period of time leading up to this financial disaster? What signs point toward an impending money crisis that may be able to tip you off that something needs to change before it’s too late?
You probably already know if you don’t handle money well. Some people are able to get by just fine with a little help from overdraft protection and small loans from family, but oftentimes money mismanagement will turn into something pretty dramatic if you don’t take the steps to wise up and change your ways.
How do you know if you’re heading toward financial trouble? If you answer “yes” to two or more of these statements then it’s time to make some big changes to your personal financial situation, whether it’s getting a budget in place, or cutting up your credit cards, or doing a complete overhaul of your personal financial situation.
Do any of these apply to you?
1. I don’t have a savings account in place at all.
2. Most of my credit cards are maxed out.
3. I’m behind on some of my bills.
4. Every day I get a phone call from a creditor.
5. Sometimes I have trouble sleeping because of my money problems.
6. I usually run out of money before my next payday.
7. Whenever I apply for new credit it gets denied.
8. I have to use credit cards to pay for basic necessities a lot.
9. I spend a lot more than I can truly afford to when I go shopping.
10. I’m pretty sure I’ll wind up in bankruptcy if somebody doesn’t bail me out soon.
Only answering “yes” to one statement shouldn’t be cause for celebration. You should strive to not only answer “no” to every single one of these statements, but to get to the point to where you scratch your head in confusion that anyone would ever answer positively to any of them at all.
So what do you do if you answer “yes” to some of these? First pat yourself on the back for recognizing that you need to make some changes, and then get to work with bringing your bills up to date while cutting back on your expenses. Yes, it will take some effort to get back on track, but it will certainly be worth it.
Late Payments: Personal Finance Advice
If you’re like most people you probably have a few different payments you send out every month. Between utilities, loan payments, and credit cards it can be easy to miss a payment once in a while. So what do you do when you realize that you forgot to send a payment to someone and it’s late?
The worst thing you can do is ignore the problem. Don’t just decide that you should send in a double payment next month because it just doesn’t work like that. That’s like trying to cover up a snag on your pantyhose by ripping them twice as much.
Here is what you should do the very moment you realize you have forgotten to send in a payment:
Rent or mortgage: Call your landlord or mortgage lender immediately. Find out the fastest way to get a payment in. Be prepared to pay a fee not only for the late payment but also for the quick payment method.
Utility: Most utility companies are pretty liberal with payments, especially if you’re usually on time. Call the utility company and make the payment over the phone if possible, although some utility companies might just have you pay it all off with the next statement.
Loan payment: Contact the lender right away and apologize profusely for the late payment. Bring the account up to date by the quickest method possible, and if you’ve never been late before you might want to ask for a reversal of the late fee that’s probably already on your account.
Credit cards: It’s a little known fact that most credit card companies grant cardholders a grace period beyond the due date printed on the statement. Go online or call the company right away and make the payment and you may be able to avoid a late fee if you catch your mistake before the grace period ends.
After you’ve brought your account back up to date you should consider it all a lesson learned. Fashionista, you have to stay on top of your bills if you have any hopes of keeping your personal finances straight. Besides, late fees are expensive. Wouldn’t you rather spend the money on something fabulous?
Personal Finance Advice: Save for Retirement
You’re fabulous. You’re invincible. Never will there come a time when you are not raking in cash.
...or so you would like to think.
Retirement can seem like an abstract concept - kind of like traveling to Pluto or achieving complete inner peace - but when it comes right down to it there will probably come a time in your life when you just aren’t going to want to work anymore. Either you will figure the time has come to stop working so you can go out and enjoy the remainder of your life or instead your body will just tell you that it simply can’t work anymore. “You’re too old,” you body will say. “You can’t work.”
What do you do then? How do you still maintain a life without a steady stream of income coming in?
You should be saving for retirement right now. It doesn’t matter if you’re twenty-three or sixty-three. Something should be going toward an account earmarked for retirement. Even if it’s not a lot of money, it’s better than nothing.
How much you should save depends on a few different factors:
1. What is your current debt situation? If you are knee-deep in debt than retirement savings may not be your first priority right now. Some financial advisor recommend that people put savings on hold until they can get their debt under control. You can’t put off saving for retirement forever, though. At some point - preferably sooner than later - you’re going to have to start putting some money away.
2. How far away is retirement? If you are in your early twenties and you are still establishing yourself in a career then putting away a modest amount of money for retirement is still effective because you’ll have compound interest on your side. If you’re in your fifties and you don’t have much saved up for retirement then you’ll need to get aggressive.
3. What other financial factors are you dealing with? Maybe the current financial climate has you pinching pennies much more than you ever have, or perhaps you’re trying really hard to save for a down payment on a house or your child’s college education. Try to temper these goals with also saving for retirement.
Generally, you should aim to put at least 10-15% of your income into a retirement account. If you can’t put that much in a retirement account, put in what you can. If you can put in more, put in more.
Where should you stash your cash? Max out your 401k if the company you work for matches funds. You should also look into an IRA (Roth or Traditional). There are plenty of other options available, so be sure to have a chat with a financial advisor to figure out where your retirement money should go.
Save some money now so you can still enjoy your fabulousness after retiring.
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