When people celebrate New Year you will often hear the phrase “Have a prosperous New Year”. This is because it is indeed the time for looking for new ways to prosper and make the most of your finances.
If you are lucky enough to have spare money then it is essential that you take some time out to sit down and thoroughly think through the best way to put that money to work for you and to keep yourself in financial control. The New Year offers the best time of the year to do such a thing and allows you to set up your next 12 months of finances with focus and intention.
Save! Save! Save!
It is easy to get carried away with spare money left over and actually get spending it instead of saving it. Especially at New Year! Your intentions may be good but the temptation of January sales, New Year discounts and Winter bargains may be too much to fight against. Get any bargains that you may need but do not spend any additional money on items that you would not have purchased or be lured into “buy now pay later” schemes that you will regret later in the year.
Get The Very Best Interest Rate
When it comes to put savings aside make sure that you really shop around for the very best interest rate. It is said that people are more loyal to their banks than they are to their partners because so few people switch their bank accounts.
Christmas spending often leads to extra strains on your finances. Whether you have taken out extra loans to cover your outgoings or maxed out the credit cards on gifts for friends and families, either way, help is at hand.
It may be a case of your debts have simply spiralled out of control regardless of the Christmas expenditure. If so, now is the best time to sit down and take stock of the situation in a bid to regain control of your finances.
Take A Time-Out
The first place to start in taking control of your debt is to put aside at least half a day to sit down and really sort through your finances. Too many people try to juggle their finances with work and the kids and never really devote the right amount of time and focus to get things properly sorted and so the problem perpetuates or even gets worse.
Outgoings
It stands to reason that the more money you have going out, the less money you have to put towards paying off your debts. Therefore, make a comprehensive list of all your outgoings down to the final cent. This should include all the obvious things such as gas, electricity and mortgage payments but should also include other less obvious things, such as how much you are spending on lunch at work each day, your cable bill and newspaper subscriptions.
The Christmas season is a time of year when impulse spending is at its worst. It’s way too easy to impulsively add something to your basket or your online order, and it’s one of the easiest ways to increase your debt obligation. For many consumers, saving during the holidays is unheard of, but there are ways you can minimize the amount of money you spend and the amount of additional debt you take on. Here are 10 of them:
1. Get a prepaid credit card – Afraid your husband might go a little crazy with the credit cards buying you things for Christmas? Maybe your wife has no control when it comes to baby’s first Christmas? A prepaid credit card is the perfect solution. It will curb overspending, and they’ll be no worries about late fees.
2. Know your credit limit – Confirm your limit before you hit the stores, and avoid accidental over-limit spending which can wind up making your APR go significantly higher that it currently is.
3. Cash in on those reward points – Using rewards points is a great way to keep your money in your pocket and still make purchases.
4. Dig out the greenbacks – Although paying with cash isn’t a sign of the times, it’s a perfect way to keep your spending in check this Christmas season.
As the name may indicate, prepaid credit cards are, well…prepaid. They’re fast becoming popular with consumers, and for good reason. Prepaid credit cards are actually a safe bet with regard to keeping debt under control. There are, however, some things you should know about before getting one. Here’s how it works.
A prepaid credit card is very much like a gift card; minus the fees, of course. You load the card with your own money. It’s sort of like putting down a security deposit on the card. Then, you make purchases with the prepaid credit card, and the money comes out of the security deposit (The preloaded money). Once you’ve used up the security deposit, the card is no longer usable. Hence, you can’t accidently put yourself into more debt.
The Advantages
• It’s a secure way to spend without taking on further financial obligations.
• You can have your payroll check loaded right onto the card if you so choose.
• Using the prepaid credit card eliminates the need to walk around with cash in your pocket.
• Because the card is already paid off (per say) there are no later fees to contend with.
• There are no credit checks to obtain one.
• It really doesn’t matter whether you have a job or not because the card is already paid off when you get it.
The Visa Black Card is a credit card like no other. Made of carbon this credit card looks and feels special and that’s even before we take a look at it’s benefits. Firstly the card is accepted in over 170 countries and comes with a 24 hour concierge service to cater to any of your travel, personal or lifestyle requirements. This service includes entertainment planning, business services, travel information and help, country and city information, gift arrangements and assistance in purchasing hard to find items.
You receive VIP access to over 600 worldwide airport lounges plus the exclusive Rewards Program lets you redeem points for 1% cash back or for airfares on any airline with no blackouts or restrictions beginning at only 25,000 points for a ticket worth up to $500.
Zero liability gives you complete protection against unauthorized purchases made with the Black Card.
Other benefits include a warranty manager service on purchases, lost luggage reimbursement for up to $3,000 per trip when you purchase your ticket with the Black Card, trip interruption/cancellation insurance of up to $1,500, baggage delay insurance, auto rental collision damage waiver, worldwide travel accident insurance and roadside dispatch in the US and Canada.
Credit cards require responsibility. You need to be able to make all of your payments on time, reduce temptation to overspend, and keep yourself from falling into debt. That responsibility is one of the main reasons that no one under the age of 18 is allowed to get a credit card – there is serious concern that young people are both irresponsible, and will not have enough money to pay it back.
When you turn 18, however, you are immediately allowed to apply for a credit card – but should you? When is the best time to get your first credit card?
Get Your First Credit Card
Provided you have some way of making your payments, you should get your first credit card as soon as possible after you turn 18. While credit cards do run the risk of causing you to fall into debt, they also help you build up a credit history. That credit history will help you get lower interest loans, better interest rates, and have other benefits that may help you in the future.
The sooner you start to build your credit score, the better it is for your long term outlook. Someday you will also be buying a car or getting school loans and a good credit score can make the interest rates on all of those loans much lower.
Experts recommend that you keep no more than two credit cards at a time, and that you change your credit card as infrequently as possible. Every time you change your credit card you may risk lowering your credit score.
There are many reasons why you may want to change your credit card and replace an old card with a new, better credit card. Here are several reasons it may be a good time to change your credit card.
When to Change Credit Cards
Raised/High Interest Rates
If you have or will have a high interest rate on your credit card, yet your current credit score is much higher than it was previously, it may be a good time to switch. Some people get credit cards when they have bad credit, only to build their credit later. Others have great credit, but the credit card company started to increase their interest. Either way, switching to a low interest card can be beneficial.
New Bank
It’s not uncommon to have a credit card associated with your bank. If you switch banks, suddenly the card has lost its convenience value, and you may find that there are several better credit card options available. Bank credit cards tend to have the fewest options but the most convenience provided you are a member of their bank.
One of the greatest fears that many credit card users have these days is the idea of their card getting stolen. Identity theft is everywhere, and while there are many precautions in place to reduce the effects of a stolen credit card, it can still be a traumatic, difficult experience that most people hope to avoid.
How Do Credit Cards Get Stolen?
Not long ago, the only way you could take a credit card was if someone left it out in the open. Nowadays, however, credit card information is becoming much easier to not only steal, but also use. You can have your information stolen simply by having someone look at your card, write down the numbers, and use that information to buy things online. You can also have it stolen if a website you used gets hacked, or was run by someone that didn’t input the security codes correctly.
Whatever the method, stealing a credit card has become easier. Thankfully, a number of credit card companies have put safeguards in place so that your life will not be turned upside down by a stolen card.
After It Gets Stolen
These days, it is usually the credit card company – not the individual card owner – that is able to spot unwanted charges.
When it comes to lenders, your credit is determined primarily by your credit score. Your credit score represents a “risk profile” – in other words, it tells lenders and credit card companies how much of a risk it would be to give you credit.
Credit companies take that number and decide on loan amounts, credit lines, and interest rates depending on where you rate. When your credit score is higher, your interest rate will be lower, because companies want to entice you to use their services. When your credit score is lower, your interest rate will be higher, because credit companies want to be reimbursed for the risk they have in taking you on as a borrower.
Understanding Credit Scores
Reading your credit score accurately is important, especially when you are considering a credit card or a loan. By understanding what your credit score means, you will be able to:
Know if you need to improve it, so you can take the necessary steps.
Make sure they are accurate based on what you know about your credit history.
Ensure that you are getting the right type of rate for your score.
For example, if you have a great credit score, but are offered a high interest loan, you may be able to find a better rate elsewhere.
Managing your finances is an important part of living a stress free lifestyle. Money – or, more specifically, improper use of your money – is one of the leading causes of personal and relationship stress, and small personal finance mistakes now can lead to long term financial problems later.
Managing your finances correctly should always be part of your long term plan. Here are five common personal finance mistakes that you need to avoid if you hope to experience less financial stress in the future.
Personal Finance Mistakes
Signing Up For Store Credit Cards
You hear it in almost every clothing store. “Would you like to sign up for an in store card and save $10?” The answer should be no. In store credit cards are still credit cards. They have interest rates that can easily cause you to pay more over the long term than you saved by signing up for the card, and store credit cards will negatively affect your credit score, which will have you paying more for loans and credit cards in the future.
Not Putting Money Into Savings
The problem with budgeting is not that people can’t keep within their budget – it’s that you can’t assume that you can keep within your budget 100% of the time.
