Do You Believe These Money Myths?

There are a lot of different things you’ll read when it comes to your money.  The personal finance world has lots of people with many opinions.  I’m one of them!  But with so much out there, it can often get confusing.  What do you believe?  What’s true and what’s a suggestion?  I don’t have all the answers.  But there are a few money myths that I’ve seen come up more than a few times.

#1: Always Pay The Higher Interest Loan First

The higher the interest rate means that less of your payment goes to your principal.  This is true.  So, you should always pay the highest interest loan first, right?

Not always.

I think you have some flexibility here.  If you have a loan with a low balance, maybe consider paying that off first.  It will free up some cash flow.  Plus, paying off a loan will give you a ‘win’ on your scorecard.  Those can be very important and might be worth a few bucks in higher interest in the short term.

#2: It’s Too Late To Start Saving

Many people start saving for retirement or their first home right out of the gate.  If you’re one of those people, then congrats.  But if you’re not, don’t worry.

It’s never too late to start saving.  I don’t care how old you are.  Many people who give this answer are just making excuses to continue bad habits.

I don’t care if you have friends that are your age who are already retiring and you haven’t saved a buck.  You should and you can start making a difference.

#3: You Have To Choose Between Paying Off Debt Or Saving Money

I’ve read at least a thousand pieces over the years on this topic.  Which is better if you have extra money?  Paying off debt?  Or saving/investing?

I’ve never understood why people think it has to be either or.  It doesn’t.

If the answer isn’t clear or you don’t have motivation toward one, why choose?  Try a mix of both.  Either one is going to help you in the long run.  And, you might find that one excites you more than the other.  If that happens, then you can make adjustments.

#4: Having An Emergency Fund Is Good Enough

OK, so you saved $1,000 for an emergency fund.  You’re covered, right?  Wrong.

The fact is that even if you’ve built yourself a cushion, there is still work to do.  What if you have an emergency greater than $1,000?  How will you restore your fund if an actual emergency depletes your fund?  What if someone comes to you with an emergency of their own?

Be prepared.  Think ahead.

#5: Following Someone Else’s Budget Is Your Ticket To Success

A budget that works for someone else may not work for you.  Everybody has different circumstances and different needs.

Also, many people are at different stages of how they can handle a budget.  Someone who’s never used a budget should start simple. If they tried to use the budget template of someone that’s had one for twenty years, it probably won’t work.

Budgets come in all shapes and sizes.  There is no one size fits all.

#6: Focus On Cutting Spending To Save Money

This isn’t bad advice.  It’s actually really good advice.  However, it may not always be the best advice.

After all, the advice here only focuses on one side of the equation.  Spending.  This is great, but there’s also opportunity that comes by making more money.

Consider that we all have limited time in our lives in which we can focus on saving money.  If your time allows you to cut $1,000 per month in expenses, that’s great.  But what if you focused that time on earning more money instead?  If you could earn $2,000 per month with the same effort, then focusing on cutting expenses could actually be costing you $1,000 per month.

#7: The Stock Market Is Always Going To Go Up

It may seem like this is true given that it pretty much has for the last ten years.  But it doesn’t.  And it won’t.  Don’t believe people on CNBC that tell you that ‘this time it’s different’.  And that the market can go up forever.

It’s not and it won’t.

Everybody needs to keep an eye on the market and recognize that it’s not a one way only road.  The experts that tell you that it can only go up probably have a plan in place.  And when the market starts going down, they’ll have executed their plan before they go back on the air and talk about the downturn.  Trust me on this.

The fact is, they don’t care about your money.  They care about theirs.  Don’t get the two confused.

Readers, what advice have you heard that may need some corrections or clarifications?  What do you think about the items I mentioned?  Please let me know your thoughts in the comments below.  Thanks for reading.

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

10 Short Term Money Goals That Are Easy

We all know we can do a better job at saving money, right?  I know I do!  Sometimes figuring out where to start is a bigger obstacle than actually making the changes.  If you can relate to that, then this post is for you.  Here are ten short term money goals, things that you can do today and without much trouble, that can really help you out.

Review Your Insurance Policies

Most people could save money on insurance.  You can often adjust your deductibles to lower your payment.  I also recommend shopping your policies around.  If you have more than one type of policy, you can often get a multiple policy discount by using one carrier.  Either way, checking your insurance is something that can probably save you money.  The great thing is that you can do this with just a few phone calls or website visits.

Create A Savings Fund

If there’s something that you have always wanted but don’t have the money for, that can change!  Create a savings bucket and start putting some money aside.  Whether it’s a bigger TV, a new car, or a family vacation, you can start saving for it today.

Calculate Your Debt To The Penny

Most people know the benefit of getting out of debt, or even reducing it.  This is all fine and good, but I wonder how many people know exactly how much debt they have.  Now is the time to figure it out.   Look at everything you owe and add it together.  It might sound like a frightening idea, but knowledge is power.  Once you know your debt amount, it won’t be holding itself over your head.  Now you can start thinking about ways to pay it down!

Create A Christmas Fund

This sounds an awful lot like the savings fund idea, but it’s really a specific one.  If just thinking about paying bills in January stresses you out, then this one is for you.  Stick a little bit aside every month and you can have a good chunk (or all) of the money ready when the bills come due.  I’ve used this strategy for years and it makes the holidays much less stressful.

Look At Your Cell Phone Bill

If you have a cell phone, and who doesn’t, then take a look at the bill.  You might be able to save some money.  These days the plans and offerings change so fast, that you might be able to make some changes and save some money.

Bump Your Retirement By 1%

Most people won’t notice if their paycheck declines by 1% but it can make a serious difference in your savings.  Go in and add 1% to your deductions today.  Bonus tip: Every time you get a raise, bump it by another 1% each time.

Sell Some Junk

It might be junk to you but you might have stuff sitting around that someone else will pay for.  You get money and space.  It really can’t get much better than that!

Track Your Net Worth

This is another one that goes into the ‘knowledge is power’.  Track your net worth, which is simply to add together all of your assets, then subtract out your debt.  Once you’ve figured it out, then re-calculate it every month.  This will start letting you see how your financial story is changing over time.  The thing is you have to start doing it, so do so today.

Check Your Credit Reports

You get a free check of each of your three credit reports every year.  I go in roughly every four months and run a check of my credit report. This is easy.  It only takes a few minutes.  You want to make sure that everything is accurate, and you can use this to identify things that you could do, like close a dormant credit card account.

Think Of Something That You Can Live Without

Indulgences are fine, but chances are there is at least one that you can get rid of and find that you’re perfectly OK with.  If you have premium channels on your cable package, could you drop this? Could you make your own coffee instead of stopping at the coffee shop?  Do you really need that pair of fancy shoes?  When you spend less money, it adds up to money in your pocket.

Readers, what are some easy ideas that you have to meet short term money goals?  Let me know your ideas and what’s worked for you in the comments.  Thanks so much for reading.

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

Free Cash: Why We Use Cash Back Credit Cards

We use cash back credit cards for just about every purchase that we possibly can.  Why?  The answer is simple, because we earn free cash and it adds up to a good amount.  Below is how much cash we’ve earned in the last twelve months.

Costco Visa Card

This is our primary spending card.  It has the most rewards that we use.  We get 4% cash back on gas, 3% at restaurants, 2% at Costco, and 1% on everything else.

They issue a certificate once per year that you take into the store to cash.  This year we’ll be getting $281.88.

American Express Blue Everyday Card

When Costco switched from American Express to Visa, we took an offer to open one of these cards.  We primarily use this at grocery stores, as we get 3% cash back.  We do make other purchases on here as well.

Since we opened this last year, we’ve earned $159.32 in cash back.

In addition to this, American Express has the best ‘offers’ of any card I’ve seen.  In addition to the above, we’ve saved money on statement credits just for using American Express to pay our cell phone bill, visit a Mobil station, or even just to sign in to their online app.  Plus we got a big statement credit just for spending a certain amount on the card within 90 days.  Without looking, I’d say we got over $350 in statement credits on top of the cash back.

Citi Dividends Cards

These were the first cash back cards we ever opened, and I don’t think you can even get them as new members anymore.  But, for these (just like everything else) we get 1% cash back on everything, plus 5% on rotating categories that change every quarter.

We pretty much keep these because they’re our oldest cards, and having a card established for that long is good for our credit scores.  We’ll use this for camping reservations or other purchases that don’t give bonus money on any other card.

Between my card and my wife’s card, we have earned $125.41 over the past twelve months since we last cashed out.

Grand Total Earned From Cash Back Credit Cards

Adding all of that up, we have earned $566.81 in cash back just by using our cards.  We pay our cards off in full every month, so we aren’t paying a nickel in interest.  Nor do we pay an annual fee for any of these cards.  That’s basically us buying things or making purchases on things we’re going to anyways, and ending up with over $500.  That is a pretty good deal if you ask me.

In the past, we’ve used our cash back rewards cards to purchase electronics.  All of our flat screen TVs have been purchased with cash back rewards money.  We’ve also applied this toward a vacation in years we haven’t needed anything new.

Readers, do you use cash back reward cards?  Do you make sure to use them to your full advantage?  If so, what tricks or tips do you have?  Please let me know how things work for you in the comments below.

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

Fix Financial Hiccoughs In The New Year

More than just your waistline could be hurting after a very merry holiday. The season has a way of getting out of control despite your best efforts. Between travelling, handing out presents, and all of the extra seasonal accoutrements that come your way, you can end up going over budget. Before you know it, it’s a new year and you’re stuck with the financial consequences of 2016. At least there’s an easy way to fix your financial discretions, and it all starts with a direct lender.

Direct lenders are quickly becoming a preferred alternative to conventional lenders because of their quick and convenient processes. Many traditional, brick-and-mortar lending companies still rely on in-person meetings and in-depth review of your credit. A direct lender has eliminated these time-wasting elements from their practice. They still require basic financial information, but they collect it online through a simple application form. If there’s any data they need to verify, a representative will call at a convenient time and clarify them. Millions of Americans prefer these methods to the bureaucratic red tape of the nation’s top banking institutions.

By conducting the majority of their business online, direct lenders can connect you with the money you need quickly. Their applications shouldn’t take longer than 20 minutes to fill out, and you’ll know if you qualify almost instantly. Should you be approved, your small dollar loan or line of credit can be directly deposited into your account within one business day. This efficient and speedy response means you won’t have to wait endlessly as a whole team of financiers look over your application. Instead, you’ll have the money you need before the upcoming due date of your bills.

These basic features are shared by most direct lenders across the States, but each company will differ slightly from the next. In some cases, direct lenders will stand out because of the predatory rates and fees that are associated with their products. It’s important that you stick with lenders such as MoneyKey that follow your state’s lending laws. These regulations were put in place to protect consumers by limiting the rates, terms, and interest allowable on their products. You can go online to learn about online direct lenders and see how a lender like MoneyKey intends to ensure their short terms loans remain a responsible lending option.

Confirm with your lender if even the state-regulated rates and terms are something you can accommodate in your budget. One of the representatives available at MoneyKey can discuss their products and processes in depth so you understand the extent of your loan. Once you have a small dollar loan or personal line of credit at your disposal, you can easily tackle the leftover bills from an overeager holiday.

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.