Monday, March 26, 2012

Money Lesson: Stay Busy


I love the feeling of having plans.  Nothing is more exciting--or makes the workweek go by more quickly--than having something to look forward to on the weekend. I also find that having weekend plans keeps my spending in check.  On the days where I have nothing to do, my boredom leads me to the mall or browsing the aisles of Target...and we all know how tempting it is to spend once you set foot in the stores!

I've also noticed that I'm more prone to constant snacking and mindless eating on those lazy days where I just stay in the house reading blogs and watching Netflix.  There's a saying that goes "the Devil finds work for idle hands to do” and I think there may be a little truth to it.  When there is something on my calendar, even if it's something like a visit from family or plans to attend an event, I'm usually occupied for a number of hours, engaged in some activity that doesn't require me to spend money, and I'm not even tempted to spend any money.  Sometimes I get engrossed in a good book or working to craft a blog post and the next thing I know, I've had a "no-spend" weekend!

If you are like me and are tempted to shop out of pure boredom, find ways to stay busy! Visit your loved ones, spend more time on hobbies, and find budget-friendly activities to occupy your weekend!

Friday, March 9, 2012

Money in your 20s: 5 Things Everyone Should Know

Women's Money Week 2012 Participant

I am participating in the first annual Women’s Money Week, a project to empower women to take control of their finances.   Today's topic is Money in your Twenties/Thirties/Forties/Fifties/Retirement. Check out the Women's Money Week 2012 website for more posts from some amazing Women Money Bloggers!    

For some this period may represent your glory days while others may refer to it as a Quarter Life Crisis, but your 20s is a time of amazing transformation. The bridge connecting adolescence and adulthood, your 20s may bring your first (full-time) job, first love, first major purchase (ex- a new car), and first experience with recurring bills (student loans anyone?).  With all these “firsts,” it is important to make sure you are making smart choices and creating good habits to carry you through the rest of your life…ESPECIALLY when it comes to your finances.    Here are a few things that I believe everyone should know about money before leaving your 20s to put you on the path to financial security:

How to create a budget.
You have probably heard this before, but the budget is one of the basic principles of personal finance. For some, this may be your first experience making enough money to actually support yourself.  In order to manage this new fortune, you need to keep track of the money you have coming in (income), the money you have going out (expenses), and make sure that your income is always greater than your expenses.  

Avoid the credit trap!
When I was in college, there were credit card companies all over the campus offering free t-shirts, mugs, etc.  just for signing up.  In that setting I was eager to sign up for my first credit card, but luckily I refrained from actually using the card for over a year and truly considered it a tool to be used for emergencies (and the occasional tattoo—don’t judge me lol).  Your 20s is a time for establishing and building your credit. Because you probably have little to no credit already, you probably won’t have the best credit rates, so spending recklessly on your card and carrying a credit card balance from month to month means that you may face hefty interest charges.  That spring wardrobe you caught on sale might not be that good of a deal if you buy it on credit and have to pay an extra 10-20% over the course of a year.  Also, don’t mess up your credit early by applying for a lot of different credit cards, maxing out card, and missing payments.  Not only do these immediately hurt your credit score (which would affect your future interest rates on home/auto loans), but they create bad financial habits that become more and more difficult to break.

Friday, March 2, 2012

2012 Financial Goals: February Update

Save $4000 by January 2013 I contributed $210 to my savings account this month through automatic direct deposit. I also took part of my tax refund along with some of my "buffer" in my checking account and added $600 to savings, so I've already saved about $1000 so far this year!

Maintain a buffer of $100 in my monthly budget. I've really been sticking to this one, and February was almost as good as January.  By the end of the month I had an extra $650 left over after expenses and savings!

Maintain $0 credit card debt.
I used my credit card for my regular monthly expenses (grocery, gas, etc.) and paid the balance in full by the end of the month.

Open a Roth IRA
Haven't done this yet.