Personal Finance
Go Green and Save Money: Personal Finance Advice
You may not have realized this quite yet, but personal finances and being environmentally conscious can go hand in hand. Going green is really trendy right now, so why not combine your environmentally-conscious savvy with your efforts to get your personal finances in order?
Here is an example: You choose to shop for vintage clothing at a consignment shop instead of heading to the mall to buy up a bunch of new stuff.
Why this is Green: Recycling goes beyond cans and paper bags. Any time you extend the life of a product – like clothing – you’re living a more sustainable lifestyle. If more people bought clothes secondhand then fewer resources would be used up for the production and shipment of new clothes.
Why this is fabulously frugal: Secondhand clothing can save you a lot of money because it usually doesn’t cost as much as brand new clothes do, and as an added bonus you can find some clothes that not everyone else is wearing at the moment.
Another example: You bring your own reusable cup filled with water when you head off to the gym.
Why this is Green: Even though plastic water bottles are recyclable, a good portion of them wind up in landfills instead of getting recycled. Plenty of valuable resources are used to produce these bottles too.
Why this is fabulously frugal: You can save a lot of money by drinking water from your faucet, even if you run it through a filter first. Buying disposable water bottles over and over again can get awfully expensive.
It’s true that some Green clothing – especially organically produced clothing – can sometimes cost a lot more than clothes produced using traditional means. When you’re trying to keep your spending down you need to pick and choose which products you’re willing to spend more for in order to be more environmentally friendly. This is one instance when the frugal choice is still the best choice for the environment. You have less of an environmental impact by purchasing some secondhand clothes than you do by purchasing some brand new clothes that are certified Green.
Then again, it’s probably a greener and more frugal decision to not buy any additional clothes at all, but who wants to do that really?
The point is that going green and being frugal doesn’t necessarily mean that you have to go join a commune and forgo your love of fashion. You can still be fiercely fabulous while also keeping your finances in order and lessening your environmental impact. You just need to look at things from a Green perspective while also keeping your personal finances in mind.
Personal Finance Advice: Are You Scaling Back Yet?
If you haven’t been tightening your financial belt lately amidst all the recent drama with the economy then there is probably one of two reasons:
You’re independently wealthy.
You haven’t been paying attention.
Prices on gas, groceries, and other essentials have been creeping up steadily for a while now, which has most people paying more attention to how they spend their money. If you’re one of the few people who hasn’t really noticed any difference in what things cost then there is a pretty good chance that you don’t have a very firm grasp on your personal finances.
Think about it: If you plunk down a credit card for every single purchase and then make the minimum payment every month then probably wouldn’t notice that the balance of your credit card has reached ridiculous levels. If you’ve watched the alarmist news stories about the cost of everything and you’ve replied with a shrug and wondered what all the hubbub is about, then you might be in financial trouble and not even know it.
It’s time to take a look at your spending. Nobody really knows if the economy is going to get worse before it gets better. Will you be ready if everything starts to cost even more than it does now? What do you do if your credit card gets maxed out? What do you do if (gasp!) your credit card company lowers your available credit?
The point is this: If you haven’t started scaling back on your frivolous spending then the time has come. If you are a true Budget Fashionista then you already know how to get your hands on the stuff you want without spending a fortune. The trick is to apply this to your other spending. How can you save money on groceries? How can you save money on gas? How can you save money on everything?
Even if you pay attention to your finances really well and haven’t yet felt an economic squeeze, it doesn’t hurt to practice spending less and saving more. Don’t obligate yourself to big purchases right now unless you can actually afford it. Don’t quit your job if you don’t have something already lined up.
And for goodness’ sake, don’t use your credit card with reckless abandon.
Personal Finance Advice: If It’s On Credit It’s No Deal
How many times have you stumbled across a massive clearance or enticing sale at your favorite store right around the time when you ran out of money until the next payday? If you are like most people, chances are when this occurs your first instinct might be to grab your credit card and start charging. After all, you don’t want to miss the deals the store is offering. 80% off on clothing? Who in their right mind would pass up a deal like that?
If you don’t have the money in your wallet or in your bank account then you should be the type of person to pass on a deal like this. It doesn’t matter if you’re favorite brand of jeans winds up on the clearance rack and the store wants to eliminate the stock pronto. If you’re trying to get your finances in order and get out of debt then you need to avoid situations where you whip out your credit card.
Yes, that includes situations when a great deal is staring you in the face.
Think about what happens when you use your credit card to buy something, even if it’s on a fantastic clearance:
1. You buy your item on a credit card, fully intending on paying the balance off once you get paid. You congratulate yourself for finding such a great deal.
2. If your credit card had a zero balance before the purchase of the clearance item, you are now psychologically equipped to make more purchases on the credit card because of the small balance. You start charging more purchases, still sure that you’ll pay it off when the statement comes.
3. The statement comes, and you’re shocked and bewildered by the balance. You know that you bought a few things, but weren’t they all on clearance?
4. You’re unable to pay the balance in full, and now that you’re despondent over the whole situation you send in the minimum balance and go spend some more money on your credit card.
5. You eventually wind up paying more money in credit card interest charges on your clearance purchase than if you had bought it for full price with cash.
This isn’t an absolute outcome for everyone, but it’s quite a common scenario. You may have the noblest intentions of paying off the credit card purchases once the statement comes, but all too often it turns into something bad. If you don’t have the cash to buy it, don’t buy it. Even if the clearance rack is chock full of fabulous clothes in your size you should first think about the financial repercussions of charging up a credit card that you are desperately trying to pay off (or keep paid off).
Don’t let the lure of a good sale keep you from your financial goals.
Personal Finance Advice: Switch Banks
Do you ever find yourself wistfully daydreaming about switching your checking account to another bank? Do you figure that there must be a financial institution out there somewhere that doesn’t charge you ridiculous and costly fees all the time? Do you wonder if there might possibly be a bank or credit union somewhere that has customer service representatives who aren’t so incredibly rude and inept? If you have these thoughts running through your head then it’s very likely that these thoughts are quickly followed by another thought: “Forget it…it’s too much of a hassle.”
If you are like most people there are plenty of things going on with your checking account. You probably have your paycheck directly deposited into the account, and there is a good chance that you have more than one automatic payment that is directly debited from the account on a regular basis. You have checks printed up, you know your PIN, and your bank’s website is on your Internet Favorites list. This obviously means that breaking up with your bank would probably be a big deal and would be a great inconvenience to you, right?
Not necessarily. Financial institutions are constantly courting new customers and they try to make it as easy and seamless as possible for someone to open an account and switch over. Some banks will even have you fill out paperwork that allows them to act on your behalf and request a transfer of funds from your old bank. In other words, they make it as easy as possible.
What about those pesky automatic deposits and payments that go in and out of your account? Those can be switched relatively easily, but don’t close out your old account until all your recurring transactions have made it over to the new account otherwise you may wind up with some hefty insufficient fund fees.
So at what point are you justified in moving your money into a new institution?
1. You pay a lot of money in fees and find a different bank that doesn’t charge so many fees.
2. You don’t get a very good interest rate return on your savings and find a different bank with impressive interest rates.
3. Your bank has no local branches and you want to be able to walk in and talk to a representative face to face.
4. Your bank has horrible customer service.
It’s your money! At no point should you feel loyalty to your bank or credit union if they aren’t providing you with the service you need. Pack up your metaphorical financial suitcases and move your money to a different financial institution. You can save a lot of money and erase one hassle out of your already hectic life.
Personal Finance Advice: Think Like a Marketing Executive
The second you walk into a store your senses are immediately assaulted with a variety of sneaky tactics that marketing executives use in an attempt to get you to spend more money than you originally intended. Enticing merchandise is placed at eye level. Red tags are placed on merchandise that isn’t actually on a really great sale at all. Everything you see, hear, feel (and in some cases, smell), is designed to make you want to give the store as much money as possible.
There is nothing innately wrong with these tactics. After all, anyone who has ever taken an introductory psychology class can understand that the way merchandise is presented can change the way consumers view it. On the other hand, since your goal should be to save as much money as possible and avoid as many impulse buys as you can then you need to be on the lookout for these tactics whenever you enter a store.
How do you know when marketing tactics are being successfully used on you? Here are some examples:
1. You enter a store you didn’t intend on going into.
2. You find yourself sifting through the full-price racks even though you only intended on searching through the clearance racks.
3. You spend a lot more than you intended on spending.
4. You walk out of the store having bought something that you don’t need and that doesn’t even really belong in the store (like breath mints at a clothing store).
These things happen to the best of us, so don’t get too embarrassed if you find them happening to you. The key to avoid them in the future is to think like a marketing executive when you enter a store. If you find yourself drawn to something then before you decide that you simply must have it you should ask yourself this question: “Am I falling prey to a marketing tactic right now?” Sure, that glittery skirt seems like a good idea while it’s surrounded by flashy lights and appealing accessories, but once you get it home are you going to scratch your head and wonder why in the world you bought something that not even a self-respecting go-go dancer would wear?
If you take a look around you’ll notice that everything in your favorite store is set up to compel you to spend. Instead of simply giving in to every purchase temptation and chalking it up to poor will power, try to approach shopping with a more critical view. Ask yourself if you’re buying something because you want it, need it, and will use it…or if you’re buying it because some marketing executive is particularly clever.
Personal Finance Advice: Buying a Car
We all know - or should know - that buying a car involves a lot more than finding a make and model that suits your personal tastes. While it’s true that you don’t want to buy a car that you personally find to be hideous, there is so much more to buying the right car than choosing one that makes you look good and matches your favorite nail polish. The more overall finance and less fashion you can consider while buying a car, the better.
The most important thing to remember when buying a car is this: Be Prepared. Buying a car should not be an impulse buy.
Wrong: “Look at that cute car! Maybe I should go buy it.”
Right: “Look, there is that car that I spent a lot of time researching and have secured financing for. I’m ready to buy it now.”
If you wander onto a car lot without having taken the time to research your various financing choices and car options the salespeople are going to eat you alive. They know exactly how to maneuver a casual conversation with a potential customer into test drive which evolves into a credit check and a sale. Before you know what happened you’re driving off the lot with a new car. You can avoid this situation by doing a few things:
Don’t visit the lot until you’re ready to buy. You can get all the pricing information you need online or with a quick phone call to the dealership. If you do walk onto a lot without doing any research, don’t take your wallet with you. You can’t buy a car if you don’t have your identification with you.
Look beyond car lots. There is no rule that says you have to buy a car from a dealership. You can get a great deal buying from another individual, but be sure you have the car inspected by a mechanic before you agree to the purchase.
Get financing ahead of time. Secure financing through a bank or credit union before you buy the car. This gives you negotiating power while also ensuring you get the best interest rate possible. You should spend some time researching the best rate available to you. If the dealership can offer you a better rate then you can cancel the loan with the other financial institution.
Know how much the car is worth. The price a car is being sold for is not necessarily the amount of money the car is actually worth. Find out the actual value of a car before you spend your hard earned money on it.
Negotiate. You have the upper hand when you go to buy a car. You can tell the salesperson how much money you are willing to part with and demand all sorts of extras. If you get everything you want at the price you want to pay, then it’s a testament to your great negotiation skills.
Remember that you also have to take the time to research the various cars available within your price range. Find out which cars have the options you want and the safety features you need. Don’t forget to find a car with great gas mileage so you can continue to save money long after you’ve bought the car.
Personal Finance Advice: Sometimes You Just Gotta Spend
You already know that every once in a while you really need to splurge on something you don’t need, otherwise you may start to resent the budgeting process and wind up tossing the whole idea of financial management into the trash. What you should also know is that there are certain instances when you probably shouldn’t pinch pennies. While it’s always good to find the best price on things, there are plenty of times when the best price for something may still be somewhat expensive.
There are many different scenarios which do not lend themselves to scrimping and pinching pennies. For example:
Getting your hair colored. Almost everyone knows someone who tried to color their own hair and wound up with hair color fit only for an eccentric clown. This isn’t to say that boxed color is completely evil, but unless you follow the directions and do a good job of matching the colors then you may get results that you weren’t expecting. You also run the risk of damaging your hair to the point to where you’ll have no choice but to seek out the help of a professional or just wear hats for months until it all grows out.
Buying shoes you’ll wear a lot. Maybe your job allows you to wear fierce high heels all day long, but unless you wear a pair that are designed with some degree of comfort in mind then you’re probably going to wind up with sore feet, a sore back, and a pair of shoes that are going to wear out quicker than they should. Instead of buying the cheapest pair of shoes you can find, buy quality shoes at discount prices or secondhand. Your feet will thank you.
Aesthetics. When you’re paying for a eyebrow shaping, chemical peel, or any other service where things can go horribly wrong, you should be willing to pay a little more for quality. Sure, you can probably find salons and spas that do business out of dark alleys and other undesirable locations, but do you really want to trust the lowest bidder with your bikini wax? Pay a little more to make sure that you’re dealing with a licensed professional who won’t burn you (in more ways than one).
Items that you want to last. When the time comes time to buy something you’ve been saving for - a car, electronics, furniture - you want to save money and budget for it but you may not want to automatically turn to the cheapest thing. Cheap cars are cheap for a reason; they probably aren’t going to last as long as a car that is a little more expensive. You don’t want to pay a small fortune for the things you buy, but you also need to recognize that the lowest price isn’t always the best bargain.
This doesn’t mean that you should expect the best quality from everything that is expensive. Instead, look for savings without only looking at the price tags. You want to save money, but in the long run you won’t save money if the product or service you buy is shoddy.
Get a Lower Interest Rate: Personal Finance
If you have credit cards, chances are you’re paying interest on the balances you carry. Unless your wallet is packed with cards that are still in the introductory period of no interest, odds are also good that you might be paying too much for interest. After all, if you stay on top of your payments consistently while also cheerfully paying any fees that you incur then that makes you a valuable customer. You may be surprised at how eagerly your credit card company will act in order to keep your business.
Here are the steps you should take in order to get your interest rates lowered:
Find out what your interest rates are right now. If you aren’t sure what interest rates you’re actually paying on the credit cards you have, don’t be embarrassed. You’re in a large majority. Not many people actually know what interest rates their credit cards carry. Check your statement or call your credit card company to find out what your interest rate actually is.
Find out if it’s a good interest rate. You can check to see what kind of interest rate people with similar credit scores to yours are paying by visiting a comparison website like BankRate. You’ll be able to get an idea for what the average credit card interest rate you can expect is, and armed with this knowledge you’ll know if you should insist on a lower interest rate. You may be pleasantly surprised to discover that your interest rate is actually pretty good and you don’t have to do anything further.
Call your credit card company and tell them the jig is up. Remind them that good customers should be rewarded with the best interest rates available, and if they won’t lower your interest rate then there are plenty of other credit card companies who would love to issue you a card with a better rate. Of course, say this as politely as possible.
Persist. If the customer service representative gives you the runaround, ask to speak to a manager. Even if they act like they can’t do it, most people who answer the phone at credit card companies do indeed have the power to lower your interest rate.
Enjoy your new interest rate. If you actually take the time to get your interest rates lowered then be sure to take a look at your next credit card statement and revel in the lower rate. Compare the amount of money you paid in interest charges last month as opposed to this month, and then give yourself a pat on the back for what a fabulous budget fashionista you truly are.
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