Author Archives: Team Dinks

(Guest post by Renee Williams)

Are you having difficulty managing your finances? Many people are and the consequences for their future could be devastating. People that have trouble managing their finances effectively often find themselves spending everything that they make and going into debt as soon as an unexpected financial situation occurs. Once you are mired deeply in debt, it can be very hard to extract yourself from the situation.

Fortunately, there are some simple tips available that can help you get your finances back on track. From saving more to contacting a debt management company, there are many things that you can do to save your finances.

Start An Automatic Savings Plan

If you are having trouble saving money for your future needs, you should consider making your savings automatic. By having the amount that you intend to save automatically withdrawn from your available funds, you ensure that you are putting money aside for saving while not having to think about it or spend any energy doing it. There are two easy ways to set up an automatic saving plan that will take care of itself. If your employer allows your direct-deposited paycheck to be split into multiple accounts, choose a reasonable percentage to be deposited into your savings account each month. If direct deposit is not available, you can set up an automatic transfer from your checking account to your savings account to occur on specific days of the month.

Create A Budget

It is very difficult to manage your money if you do not have a budget to dictate where your money should be going. People that spend without a budget tend to overspend on things that are not necessities and neglect to save money for the future. Your budget should include all of your monthly expenses, a savings amount, and a debt repayment amount. Once you have figured out the best allocation for your income, you must try to stick to the budget so that you can improve your financial outlook and eliminate your debt.

Ask For Help

If you are having trouble managing your finances on your own, there are many resources available to help you figure out the best way to proceed. You may want to consider contacting a debt management company that has professionals available that can help you create a debt management plan. If you are not carrying a great deal of debt, you can use online budgeting programs to help you create a useful budget that you can follow to save more money. Never be afraid to ask for help if it is needed. There are many people that are finding themselves in the same position that you are in and these resources were created to help them find their way through the difficult patches.

Has following these tips helped you financially? Tell us about your experience.

(Guest Post by Shay)

One of the things that UK credit card users find so handy about plastic is that it can be used to spread out the costs of a large purchase, such as a holiday for example. A summer break can cost hundreds of pounds, which is a lump sum that you might not have all at once in your current account. To afford your holiday then, you must either dip into your savings or use a credit card – but which is best?

If you’re dreaming about escaping somewhere hot and sunny, and are considering using your credit card to pay for your perfect holiday, read on to see the pros and cons of this particular payment method.

Pros

There are a few benefits to be had when you pay for a large purchase like a holiday on your credit card, for example:

• Spread out the cost into manageable amounts. Rather than stretching your finances by paying for your holiday outright, credit cards allow you to gradually pay for it over a number of months. This can make it much more affordable.

• Protection on spending. Credit cards offer enhanced purchase protection for anything you buy that costs over £100. Under the terms of Section 75 of the Consumer Credit Act, the credit card issuer is equally liable for purchases costing up to £30,000 if something goes wrong. So, if your holiday company goes bust and you don’t have adequate travel insurance cover, you will still be able to claim back all of your money. This even applies when you pay the deposit using your credit card and the rest in cash.

• Cashback and rewards. When you compare credit cards, you’ll see that some offer cashback and rewards on spending. This means that you could earn something extra when you pay for your holiday using a credit card.

Cons

As well as the benefits of paying for a holiday with your credit card, you should think about the drawbacks too, such as:

• Interest. Although you can use credit cards to spread out the cost of your holiday, you will still have to pay off what you owe when you get back from your travels. If you can’t clear your balance in full each month, you could be subject to interest payments which could even leave you in debt.

• Fees and charges. Some companies charge a fee for processing payments made on credit cards, although excessive charges will be banned from April 2013. You need to factor in the extra cost of paying by credit card when thinking about any rewards or cashback you might get.

(Guest post written by T. Williams)

When you are attempting to make a financial change in your life, obtaining a personal loan can help you meet the financial goals that you have set for yourself. A personal loan can be used for any financial need that the borrower has and can be arranged with generous repayment terms to reduce your risk of defaulting on the loan. Many people use these loans to purchase a vehicle, make improvements to their home, or pay for their children’s education. Here are some good reasons to seek out the best personal loan for your needs.

Better Interest Rates

Personal loans often have much better interest rates than other types of financial products. For example, personal loans carry an interest rate of around 5%, while a car loan from a dealership can be as high as 9% and the interest rate for a credit card can be around 20%. Being able to obtain financing at a lower interest rate will save you hundreds in interest charges over the life of the loan.

Build Your Credit Profile

Obtaining a personal loan can also help you build your credit profile to make it easier for you to obtain financing in the future. The best credit scores are reserved for those that have demonstrated that they can use different forms of credit responsibly. Having a personal loan that was repaid in a timely manner displayed on your credit report can show lenders that you will not be a default risk if they extend a loan to you. You will have a better chance of having your application accepted and will be offered a lower interest rate than you would get if you had a higher risk of defaulting.

Increase Your Net Worth

Using a personal loan wisely can help you increase your net worth by a significant amount. For example, if you use the money from the loan to purchase a vehicle, you increase your earning potential because you can travel farther for employment and have reliable transportation in any weather. You can also use the loan to make improvements to your home before attempting to sell it, increasing the value of the home and the profit you will receive on the deal.

It is important to use the personal loan for something that will add some value to your life and help you move forward towards financial stability. Wasting the loan on frivolous items like clothing or vacations will come back to haunt you in the future. Make the decision of how to use the personal loan carefully to ensure that you are making the right choices to meet your financial goals.

Photo by Cooperweb

(Guest Post by Kaitlin Timmer)

If you’re at this step, you’ve already decided that you need one. Whether you’re nearing retirement and wanting to make sure you’re saving enough, trying to figure out the best way to save for your children’s college, or just looking for a check up to see how you’re doing, a financial planner can be a huge help.

I may be biased, but I think that most people should see a financial planner at least a couple times in their lives. Many things you can learn on your own, but finances can be confusing, and sometimes you just need a second pair of eyes to look at your finances for you. It doesn’t hurt if that pair of eyes has years of experience working with people like you. So now that you’ve made the decision to see an expert, here’s how you choose one that’s right for you.

1. Make sure he (or she) works for a fixed fee

Some “financial planners” are really just insurance or annuities salesmen in disguise. Many so-called financial planners earn a commission on what financial products they can sell to you. In other cases, they charge a percentage of the money they invest for you. This may not seem like a bad thing, especially if you don’t have a ton of money to invest, but it can lead them to invest too much of your money in certain investments even if it’s not the best place for your money to go. Double-check that your financial planner works for a fixed fee (either hourly or a flat rate), and that they don’t earn commissions.

2. Check if your planner is certified

The most common certification is a CFP: Certified Financial Planner. There are also CFAs (Chartered Financial Analysts), and ChFCs (Chartered Financial Consultants). CPAs (Certified Public Accountants) also do financial planning. There isn’t necessarily one best certification, but make sure your financial advisor is certified. If your planner claims to have a certain certification, you may want to do a quick web search to find out if it’s accurate. For example, you can check if someone has a CFP certification by searching for them at the CFP website.

3. Make sure you feel comfortable with him

It’s important to feel comfortable with your financial advisor. You’re going to be entrusting them with one of the most important things in your life—your money—so you have to feel like you can trust them and that they’re on your side. If they’re trying to sell you things or talk you into investments that you’re not comfortable with, it’s time to find a new financial planner. You also want someone who sees you as an individual, rather than trying to give you a one-size-fits-all solution. They should help you achieve your goals, not tell you what goals you need to have.

4. Ask about her specialty

A planner’s specialty is another thing to look at when you’re shopping for advice. You probably have a specific goal in mind that you’re hoping to achieve. If they specialize in estate planning and you’re looking for a guide on how to get out of debt, you might be disappointed. Most personal financial planners will have at least a basic understanding of all areas of your finances, but it’s best to pick one who specializes in what you’re trying to accomplish.

5. Find him from a reliable source

One of the best ways to find a financial advisor is to get a recommendation from someone you trust. Ask friends and colleagues if they can recommend a good one. If none of your friends have any recommendations, you can find one online. Check out http://www.napfa.org/. The drawback of finding one online is that you don’t know much about them, so ask for references from past clients. Satisfied clients are the best sign of a good financial planner.

An important thing to remember is that if you don’t like the service you’re getting, you can leave at any time. If they give you bad advice, lose you a bunch of money, or don’t listen to you, you can always find a new financial expert. Just keep in mind that nobody can accurately predict the economy 100% of the time, and it’s normal for your investments to take a hit in a recession. But there’s a difference between a poor market and your planner making poor financial decisions on your behalf. Stay informed, ask a lot of questions, and don’t be afraid to switch planners if you think it’s necessary.

————–
Kaitlin Timmer is a staff writer for Lifed where she writes about life hacks, health, finance and productivity tips.

Photo by Keoni Cabral