Saturday, April 30, 2011

Review of the Principle of the Path

The Principle of the Path by Andy Stanley is a collection of stories of his and others showing examples of how little changes of events can change the outcome of situations. It also includes biblical stories relating to the stories also.

Even when we have a mental image of how something is going to happen, things can happen to change the path.

I have read some other books by Andy Stanley and enjoyed all of them. The Principle of the Path contains separate stories and chapters so it can be read over an amount of time if you don’t have time to read the entire thing in a short amount of time. It is also an easy reading book.

Disclosure of Material Connection: I received this book free from the publisher through the book review bloggers program. I was not required to write a positive review. The opinions I have expressed are my own.

Moving forward

If you have been following the 30 Steps of Financial Literacy Month you have a better view of your financial health. The steps give you the knowledge to improve your financial situation. I hope with the tips and ideas I have shared you will continue watching your spending habits and continue with the changes.

Just like with a diet, once you change your spending habits it will get easier and eventually be automatic.

Friday, April 29, 2011

Appreciate the benefits

Change may be hard, but the payoff can be priceless. In addition to improving your financial situation, you may also find your money management skills can benefit other aspects of your life.
I hear many people say they have never been good with finances and money. In many cases that is because we had not been taught about money. There is more education on finances in the schools now.
Its similar to changing any other type of habit, it will take small steps and soon you will be on a better path.

Thursday, April 28, 2011

Assemble a financial team

Managing your finances can be like putting together a puzzle; all the pieces need to fit in order to be rewarded with the “big picture.” Working with one or more of these financial professionals can help put the pieces in place.
A tax advisor can provide tax advice and assistance to consumers. They can help you to navigate tax laws, prepare complete and accurate returns, and develop a strategic tax plan.
If you are struggling with debt payments, credit counseling can help. You should contact a credit counseling agency at the first sign that your debts are becoming unmanageable.
Whether you are just out of college or entering retirement, most everyone can benefit from the help of a trusted financial advisor. Along with offering investment advice, financial planners may also be able to help by analyzing employee benefits, discovering insurance needs, and developing a system to manage cash flow. Financial planners can also help with estate planning and may have relationships other professionals, such as accountants or attorneys.
Lawyers can help consumers by preparing important legal documents such as a living trust. An attorney can also be very helpful if you need to consider bankruptcy or want to challenge a wage garnishment. Couples facing a complicated divorce can also benefit from an attorney’s advice.
Before working with any financial professional, be sure to check their credentials. Ask specific questions about their history and areas of expertise. Finally, be sure that you are comfortable with the advisors you choose; ideally, you will be financial partners for life.

Wednesday, April 27, 2011

Understand the Cost of Credit

It is important to know and weigh your options before making a credit decision. When you sign or cosign an application for credit, you are agreeing to all its terms. Make sure you understand what you are agreeing to before you sign the papers. Now credit card companies need to have information on the statements about how long it will take you to pay off your balance if you only pay the minimum payments.
Other things to consider are:
The Interest rate or APR - APR is the annual interest rate you will be charged on a loan or the unpaid balance of a credit card.
Length of the loan - as the length of the loan increases, the monthly payment will decrease, but the total interest charge will increase.
Finance charge - total cost of the loan stated in dollars.
Credit limit - the maximum amount you can borrow at any time.
Minimum monthly payment - the smallest payment your creditor will accept. Some people think they are doing alright if they can make their minimum payments. In many cases, the minimum payment barely covers the interest charges.
Grace period - number of days you have to pay your bill in full before interest is charged.
Over the limit and late fees - the amount you will be charged if you are late with a payment or go over your credit limit. With the new rules, the credit card companies need to give you a longer period between when you get the bill to the due date than they used to.

Tuesday, April 26, 2011

Protect yourself by performing financial check-ups

In addition to having your finances in order, it is also important to have your insurance needs in order.
Following are some things to check.
Perform a health insurance check-up. Find out what services are covered and what preventive services are offered with your health insurance. Ask if there are limits on medical test, out-of-hospital care, and prescription drugs. Research your premiums and co-payments. Explore the difference in cost between using doctors in the network and those outside it. Find out if there a limit to the maximum you would pay out-of-pocket. If you do not have health insurance, seek assistance from Medicaid or your local state-sponsored plan.
Perform an auto insurance check-up. Auto insurance pays for damages, injuries and other losses specifically covered by your policy. Read your policy carefully while performing your auto insurance check-up to know exactly what it covers. Pay special attention to the exclusions section, which lists the things your policy does not cover.
Make sure you have adequate life insurance. Realistically determine how much life insurance you need and then shop around. Term insurance is the most affordable type of life insurance, just be sure that the term lasts until your children are financially self-sufficient.
Don’t skimp on disability insurance. At any given age, your chances of becoming disabled are higher than your chances of dying. If your employer does not offer group disability insurance, seek an individual policy.
Protect your assets. You don’t need to have a lot of assets to need a will. Most importantly, a will allows you name guardians for your children. Without a will, state law determines how your assets will be distributed.

Monday, April 25, 2011

Document your Desired Spending

Now that you have identified some areas where you would like to make some changes you can look at how you tracked your expenses. Now you know what you have been spending in the different categories. If you want to lower the amount in some categories, you can see where you need to try to cut back and by how much.

It is important remember this is not about sacrifice, it is making choices to help you achieve your goals. It is also important to maintain your spending plan. Some people cut back when they get into trouble but once things start going better again, they go back to their old way of spending and may get into trouble again.

Like Dave Ramsey says “If you live like no one else, some day you can live like no one else”.

Sunday, April 24, 2011

Share a Tip

As we continue our way through the 30 steps of Financial Literacy Month, the next step is to share tips you have learned with others.

When you identify ways to reduce spending, you are being honest with yourself about your finances. Being honest with yourself and others about your finances will ensure your success. If you are in a situation where you cannot keep up the spending you have been doing, the best thing is to re-evaluate your spending and make cuts where you can. It may be difficult but will be the best in the long run instead of trying to keep up appearances and run up credit card debt.
If you usually go out with friends and cannot afford to, suggest having potlucks or other meals at home. You never know, others may be in the same situation.
The next step is to share at least one of your financial tips others looking for new and exciting ways to manage their finances.
If you are reading this on April 24, this falls on Easter Sunday. It may be a good chance to talk to others about your financial problems if you are having difficulties or share what you have learned.

Saturday, April 23, 2011

Identify Ways to Reduce Spending

To balance your budget or increase savings, most people will need to find a way to earn more or spend less. You may think you can’t spend any less, but if you start with small things, over time it will get easier.
Most purchases we make except for necessities such as food, rent and gas for the car are choices. Even with groceries, you may be able to save money by considering what you buy. Many things we end up buying are not necessities.

Even if an item is on sale and seems like a good deal, consider if you really need it. I used to buy things just because they were on sale and I still catch myself thinking about buying items like this sometimes.

Starting with small things such as bringing your lunch to work a day or two a week, cutting down on the number of times you stop for coffee, cut down spending at vending machines are simple ways to make a difference. A dollar or two here and there may not seem like a lot but it can add up to make a difference.

Friday, April 22, 2011

Saving Money on Groceries

One of the largest expenses most families has is on groceries. By making small changes in the way you shop can help you reduce the amount you are spending on groceries.

One way to save money is to prepare a weekly menu of meals. When making your menu plan, try to make meals with items you already have on hand. Then make a list of the additional items you need to purchase. By limiting the number of trips to the store you save time and also limit the temptation of impulse purchases.

Like with other types of shopping, keep in mind if it is a want or need. When we were growing up on a farm, when we would go to town, we would get to pick out a candy bar. It grew into a habit, it was years after I moved away from home that I realized I would throw a candy bar in the cart, usually without really thinking about it. Also, things like chips, etc I used to throw in my cart without really thinking about it.
Making a few small steps can make a difference.