Search Results for “three-alternatives-to-a-budget/budget-lesson-part-5/debt-burnout/budget-lesson-part-3/how-to-complain-the-squeaky-wheel-gets-the-grease/travel-expenses-why-i-splurge/budget-lesson-part-1/budget4/ignore-your-budget/573” — Page 9

Balance Your Borked Budget

You’ve got a budget worked out to the penny. You know every dollar that comes in and every dime that you spend. All of your bills are getting paid on time. Then, one day, it all comes crashing down. Your budget is no longer even a reasonable approximation of your cash flow. You’ve got no idea what’s coming in or going out. Bills are piling up and fees are digging you deeper in debt.

What happened? More importantly, how do you get back on track?

The first thing you need to do is identify the problem. What, exactly, went wrong? Did you lose your job or need a surprise botox injection? Your car died or your kid developed a hockey habit? Sports car or shoe sale? Whatever the cause, if you can’t identify it, you can’t deal with it. Some of the possible problems may be things that can get clubbed and buried in the backyard, while other things may be expenses that won’t be going away. If it’s a one-time expense, you can simply refocus your debt repayment to take it into account. If it’s an ongoing expense, you will need to adjust your other expenses, possibly in a drastic manner, to make ends meet. You can’t know which way to go without knowing what caused the problem.

Next, commit to to making it right. Don’t leave it at a mere commitment. Actually commit and actually do it right. Future-you is counting on you to fix the problem before he gets screwed. This is important. Without firm–and real–commitment, nothing else will matter. At best, you will be treading water. At worst, you will drown yourself in unanticipated bills.

Cut everything extra. Every expense–whether it’s your mortgage or your maid–is a rock in your pocket, one hundred miles from shore. How much can you carry and stay afloat? This isn’t the time to keep paying something because you enjoy it. If it isn’t absolutely necessary, it’s got to go. Cut your internet, cancel Netflix, learn to shut off the lights when you aren’t using them. Is the early termination fee less than 6 months of your cable bill, your satellite bill? Cancel it. You can always sign up again later. This is the time to be ruthless.

Is there a way to bring in some extra cash? Can you pick up a second job, or land a freelancing gig? If you’ve suddenly found yourself unemployed, can you spend some time on being a Mechanical Turk? Sell all of the things you don’t use anymore, or, more likely, never should have bought in the first place? Do you have a spare kidney?

Remember, this is a drastic situation calling for drastic measures. Your future is depending on you. Don’t make him come back and kick your butt.

Update: This post has been included in the Carnival of Personal Finance.

Can Bad Credit Cost You Your Job?

Business, Finance

Did you know that having a bad credit history could cost you your job? An increasing number of American employers have turned to running credit checks to screen job

NEW YORK, NY - MARCH 03: Bill Harris of Brook... — Image by Getty Images via @daylife

applicants. Some companies even evaluate existing employees on a regular basis by checking their credit reports. If you have outstanding debts, you might consider getting one of those credit cards for bad credit to clean up your report before you apply for your dream job.

Not all companies run your credit history when you apply for a position. However, if you’re applying for a job that entails working with money or valuables, it’s a safe bet that they’ll be checking your credit history. Financial institutions, brokerage companies and jewelry manufacturers all run credit checks, as do hotels, accounting firms, human resource departments and government agencies.

Companies run credit checks because they want to hire employees who won’t be tempted to embezzle company funds to pay off large debts. Some companies fear that employees who carry large debt loads are susceptible to blackmail or bribery. The federal government carries this concern even further, indicating that citizens who owe large debts are considered national security risks.

Many companies feel that your credit report gives them a sneak peak at your true character. Having a good credit history indicates that you are a responsible person with excellent character. Having a bad credit history means that you are an unreliable person of poor character. True or not and fairly or not, this is the current belief running throughout company hiring departments.

Unfortunately, you can’t relax about your credit report even after you’ve been hired for a position. Once you’ve given a company written permission to check your credit report, they can recheck it at a later date. Government and financial organizations often run periodic credit checks on all of their employees. Some companies only recheck your credit history if you are up for a promotion. It’s a good idea, therefore, to keep your credit history squeaky clean.

Keep in mind that having a couple of late payments probably won’t kill your chances of employment or promotion. Most employers look for the really big issues, such as high credit card balances, defaulted student loans, repossessions and foreclosures. Some companies also look for charge-offs and consistent late payments as well.

Steps You Can Take

Financial experts suggest checking your credit report before you start your job search. Read your credit report carefully and make sure that all of the information is accurate. If your report contains incorrect details or any unauthorized charges, dispute these errors immediately and have them corrected to raise your credit score.

If you have a host of unpaid bills, find a way to settle those debts to improve your credit history before applying for jobs. Many people turn to credit cards for bad credit consumers. These cards allow you to consolidate all of your debts into a single debt. Just don’t forget to make the payments on this card.

Be upfront with potential employers about any negative marks on your credit history. Just tell them that you have had past issues with your credit and are now working to clear up all of your debt. There’s no need to go into explicit detail.

Once you have a job, be sure that you check your credit report at least every six months to ensure it contains only correct information. Pay all of your creditors on time. Never take out any new lines of credit unless you are absolutely positive that you can pay it back in a timely manner.

Post by Moneysupermarket

Sunday Roundup: Outta Town

Misc

Scrapbooking Cupcakes! — Image by clevercupcakes via Flickr

This weekend, my wife is off scrapbooking with my mother and sister-in-law. Instead of hanging around the house trying to keep three kids entertained, I’m at my brother’s house, since his wife abandoned him with their kids, too. I’ll let his kids keep mine entertained, and vice versa. Woo!

30 Day Project Update

I am on the Slow Carb Diet. At the end of the month, I’ll see what the results were and decide if it’s worth continuing. For those who don’t know, the Slow Carb Diet involves cutting out potatoes, rice, flour, sugar, and dairy in all their forms. My meals consist of 40% proteins, 30% vegetables, and 30% legumes(beans or lentils). There is no calorie counting, just some specific rules, accompanied by a timed supplement regimen and some timed exercises to manipulate my metabolism. The supplements are NOT effedrin-based diet pills, or, in fact, uppers of any kind. There is also a weekly cheat day, to cut the impulse to cheat and to avoid letting my body go into famine mode.

I’m measuring two metrics, my weight and the total inches of my waist , hips, biceps, and thighs. Between the two, I should have an accurate assessment of my progress.

Weight: I have lost 30 pounds since January 2nd! That’s only 1 pounds since last week. 12 more to meet my goal for February. The difference this week? I’ve cut back on the supplements, to see if they actually make a difference. It would appear they do.

Total Inches: I have lost 16 inches in the same time frame, down 1.5 since last week.

Best Posts

I totally got live this joke.

Are you a compulsive shopper? Money Crashers has some tips to cut that down.

Before I got a smartphone, I relied on a PocketMod for almost everything a smartphone does. Does that make me a geek?

$39Glasses is having a killer sale. $15 off a $40 item is huge.

Tim Ferriss has a guide to slow-carb seasonings. It’s worth reading if your food is boring you.

LRN Timewarp

This is where I review the posts I wrote a year ago. Did you miss them then?

This was Scam Week last year. I had a post on debt scams and scams that target disaster victims. As we roll into flooding season, it’s important to know how these scams work.

I also discussed my attempt to teach my son to savor delayed gratification. It has been working. He makes long-term(for an 11 year old) plans regularly.

Carnivals I’ve Rocked and Guest Posts I’ve Rolled

Money Problems: Setting Goals was included in the Festival of Frugality.

Your Budget is Worthless was included in the Carnival of Personal Finance.

Brown Bagging Your Way to Savings was included in the Carnival of Money Stories.

Debt Burnout was included in the Totally Money Carnival.

Thank you! If I missed anyone, please let me know.

Get More Out of Live Real, Now

There are so many ways you can read and interact with this site.

You can subscribe by RSS and get the posts in your favorite news reader. I prefer Google Reader.

You can subscribe by email and get, not only the posts delivered to your inbox, but occasional giveaways and tidbits not available elsewhere.

You can ‘Like’ LRN on Facebook. Facebook gets more use than Google. It can’t hurt to see what you want where you want.

You can follow LRN on Twitter. This comes with some nearly-instant interaction.

You can send me an email, telling me what you liked, what you didn’t like, or what you’d like to see more(or less) of. I promise to reply to any email that isn’t purely spam.

Have a great week!

How to Save

Finance

Saving is hard. For years, we would either not save at all, or we’d save a bit, then rush to spend it. That didn’t get us very far. Years of pretending to save like this left us with nothing in reserve. Finally, we’ve figured out the strategy to save money.

First and foremost, make more than you spend. This holds true at any level of income. If you don’t make much money, then you need to not spend much, either. Sometimes, this isn’t possible under current circumstances. In those cases, you need to either increase your income or decrease your expenses. Cut the luxuries and pick up a side hustle. The wider the gap between your bottom line and your top line, the easier it is to save.

Next, make a budget and stick to it. There is no better way to track both your income and your expenses. I’ve discussed budgets before, so I won’t address that in detail today. Short version: Make a budget. Use any software you like. Use paper if you want. Make it and use it.

Pay yourself first. The first expense listed on your budget should be you. Save first. If you can’t afford to save, you can’t afford some of the other items in your budget. Cut the cable or take the bus, but save your money. Without an emergency fund, your budget is just a empty dream when something unexpected comes up. And something unexpected always comes up.

Automate that payment to yourself. Don’t leave yourself any excuse not to make that payment. Set up an automated transfer to another bank and forget about it. Schedule the transfer to happen on payday, every payday.

Now comes the hard part: Forget about the money. Don’t check your balance. Don’t think about it in any way. Just ignore it. For the first month or two, this will be difficult. After that, you’ll forget it exists for a few months and come back amazed at how much you’ve saved.

If you don’t forget about it, and you decide to dip into the account, you are undoing everything you’ve worked so hard to save. Do yourself a favor and leave the money alone.

5 Life Altering Lessons I Learned From My Debt

Finance, Life

Starting position of a chess game. House of St... — Image via Wikipedia

Several years ago, my wife and I dug ourselves into debt pretty deep. It wasn’t as bad as some, but it was much worse than anybody could actually want. Recognizing the problem as a problem was a life-changing event. From there, I’ve been examining every thing else about my life. As part of that examination, I’ve spent a lot of time really thinking about the ultimate causes of the debt and what it has taken to motivate ourselves to get rid of it.

I’ve realized a few things:

The things I want right now do not matter. I own around 2000 movies. Up until last spring, every time I went into a store that sold movies, I’d peruse the cheap rack and buy 2-3 moves. I’d watch them all, but the vast majority were only ever watched once or twice. The rest may as well have been rented. I wanted them and I wanted them “right now”, but after watching them once, the value vanished. Most things I’ve bought on a whim lost their value to me shortly after bringing them home. Planned purchases are enjoyable longer.
The things I care about do not cost money. I cannot buy a kiss from my kids, or a hug from my wife. The school project my son did on his hero(Me!) is absolutely priceless. The TV, the smartphone, a new car, these things are fleeting. Teaching my kids to read or ride a bike, getting beat by a 6 year old at chess, these things will last us all forever. It took $30,000 of unsecured consumer debt to drill that lesson home.
Instant gratification is easier than security, but not nearly as gratifying. It is incredibly easy to buy what you want when you want it. It is much harder to postpone buying something until you can afford it. Once you build that habit, and see the savings of delayed gratification, it’s worth it. There is a comfort in having a few months worth of expenses in an emergency fund that no amount of knickknacks can match.
I like getting stuff more than I like having stuff. It’s easy to succumb to the temporary high of a quick purchase. It’s easy to train yourself to crave that high to the point that it’s impossibly to walk out of a store without buying something. I did that. When I cleaned out my entire house this spring, I came to the realization that I don’t need–or even want–most of the things I own. I wanted it once, but once I had it, the infatuation was gone. I didn’t have many problems unloading most of my crap. It felt good to get rid of it.
Owing money sucks. The borrower is slave to the lender. When our debt exceeded our annual income, we were working 3/4 of the time just to stay afloat. Instead of being able to spend my time and money on the things that matter, I was forced to spend thousands of hours just covering interest and pretending to make progress on my shackles. That’s not how I recommend spending your life. Time is the one thing you have that you can never get back. Don’t waste it on crap like debt.

Have you learned anything from your debt?

3 Habits Every Soon-to-be-Successful Debtor Needs to Cultivate

Finance

Getting out of debt is primarily a matter of changing your habits. We’ve all heard people swear by skipping your morning cup of coffee to get rich, but that’s just a small habit. Much more important are the big habits, the lifestyle habits. Here are 5 habits to cultivate for financial success.

Frugality

“Beware of little expenses; a small leak will sink a great ship”– Benjamin Franklin

As Chris Farrel wrote in “The New Frugality“, being frugal is not about being cheap, but finding the best value for your money. When my wife and I had our second baby, we couldn’t justify spending $170 on a breast pump, so we bought the $30 model. It was quite a bit slower than the expensive model, and was only a “single action”, but for $140 of savings, it seemed worth the trade. Six weeks later, it burned out so we bought a new one, still afraid to justify $170 on quality. This thing took at least 45 minutes to do its job. When it burned out 6 weeks later, we decided to go with the high-end model. This beauty had dual pumps, “baby-mouth simulation” and it was fast. The time was cut from a minimum of 45 minutes to a maximum of 15. That’s 3 hours of life reclaimed each day fro $140. Six months of breastfeeding for each of two kids means my wife regained 45 days of her life in exchange for that small amount of money. At the rate of 6 weeks per burnout, we would have gone through 8 cheap pumps, costing $240. The high-end unit was still going strong when we weaned baby #3. Buying quality saved us both time and money. I wish we would have gone with the good one from the start. Sometimes, the expensive option is also the cheap option.

Maturity

Image via Wikipedia

“Maturity is achieved when a person postpones immediate pleasures for long-term values.” -Joshua Loth Liebman

Being a mature, rational adult is hard. It means accepting delayed gratification over the more enjoyable instant variety. We save for retirement instead of charging a vacation. It takes a lot of restraint to put off buying the latest toys, clothes, gadgets, cars or whatever else is currently turning your crank until you actually have the money to actually afford it. It means planning your future instead of looking like a surprised bunny caught in a spotlight every time your property taxes come due. (Who knew that the year changed every year? Do they really expect annual payments annually? Geez! There’s so much to learn!) It means thinking about your purchases and buying what you actually need, actually want, and will actually use instead of resorting to retail therapy whenever you feel like a sad panda. The only benefit to mature, rational management of your finances is that, given time, you will have the security of knowing that, no matter what happens, you will be okay. That’s a huge benefit.

Pleasure

[ad name=”inlineleft”]

“Do not bite at the bait of pleasure, till you know there is no hook beneath it.” – Thomas Jefferson

If it hurts, you won’t do it. You have to learn to take pleasure from from things that won’t make you broke and you have to learn not to hate putting off the things you can’t afford. Take pleasure in the little things. Enjoy the time with your family. Presence means so much more than presents. So many people never learn how to enjoy themselves. Take the time to experience life and enjoy doing it.

Update: This post has been included in the Carnival of Debt Reduction.

Search Results for: three-alternatives-to-a-budget/budget-lesson-part-5/debt-burnout/budget-lesson-part-3/how-to-complain-the-squeaky-wheel-gets-the-grease/travel-expenses-why-i-splurge/budget-lesson-part-1/budget4/ignore-your-budget/573