Author: Lauren Castle

Your Money in the News ? Feb 6th

This Week: ?Why Americans are overpaying their taxes, revitalizing money mantras, the financial fitness checklist, building an ?F-you? fund, breaking bad financial habits.

Taxing Dilemmas: Why Are Americans Still Overpaying? ? Motley Fool

As tax season hovers over us, it?s time to get the straight facts before we eagerly dive into our refunds. ?Last year, the IRS refunded an average of $2,782 (that?s a pretty decent amount.) ?A solid refund like that sounds enticing but there?s a problem that arises ? most people who got the tax refunds couldn?t actually afford to pay that money up front.

Whether you?re a middle earner or even a high earner it?s important to keep one guideline in mind:

Aim to get more of your money from paychecks as you earn it, rather than just waiting until tax season for your refund each year.

The fact is, that money is yours, to begin with, and when you get a refund you are essentially lending the government that cash for zero in return.

Pro-tip: ?If you are a lower earner, consider building some savings and paying (or avoiding) debt. If you are a higher earner with a solid financial outlook, think about investing that money throughout the year so you can grow it into a larger sum.

But really, why do Americans keep overpaying their taxes?

Part of the equation is simply lack of awareness, but ironically 49% of filers do believe they are paying too much on taxes during the year. So much of the tax system is really a guessing game and even if you do your best to estimate your withholding on your income, there?s no way to guarantee that you?re getting those numbers just right. Ultimately, fear plays a huge role as most people would rather overpay and get a refund than have to risk owing to the IRS by underpaying. ?Another important aspect to help explain the overpaying dilemma is that many of these people simply cannot risk underpaying with their very little savings account. Sadly, nearly 39% of Americans have no savings at all.

Well, what?s the solution?

Breathe easy because fear does not need to play a role in your taxes this year. The good news is that if you?ve historically received a refund, you can just adjust your withholding and get more cash in your paychecks up front. Afterwards, take that difference and add it directly to your savings account. In the end, getting your money as you earn it might be a better solution than waiting up to a year to claim what?s yours.

Pro-tip: ?Arrange to have that money filter into your savings account automatically so you don?t spend it. Better yet, you?ll have a source for paying that bill if you end up owing money on your taxes.

5 Tips to Revitalize Your Personal Finance Goals ? Forbes

Don?t let financial resolutions become a distant memory. As a new month emerges, it?s time to get serious about those New Year?s money mantras. Whether it?s getting out of debt, saving for a nest egg, or getting a firmer grip on your personal finances, here are 5 tips to re-energize your resolutions and keep you motivated throughout the rest of the year:

Assess your current situation.

Find out where you are financially and write it down. The physical act of writing down these words on paper helps to meld your ideas into something more tangible ? plus it holds you accountable to your actions.

Stand your ground.

Dig your heels in deep and determine what must happen in order for you to move forward financially. These ?money musts? represent where you (and any other stakeholders) need to declare your values clearly and accurately.

Get support.

Get great money gurus. Whether you investigate informative podcasts about finances, seek out top money tip apps, or simply choose to consult with a professional, find what resonates with your interests and stay in tune with the best advice out there.

Celebrate the little wins.

Don?t get so bogged down by goal setting that you forget to celebrate the little wins. When it comes to finances, we can only control our actions one moment at a time. Even a small decision to not cave into retail therapy, for example, takes you one step closer to financial freedom, and that deserves acknowledgment.

Embrace the mistakes.

Making mistakes is actually an opportunity to learn what didn?t work. If you?ve overspent your budget or failed to save this pay period, don?t beat yourself up. Each day offers a reset button ? just choose to do better next time.

Your Financial Health Checklist ? U.S. News

In many ways, our financial health is similar to our physical health. Just like eating the right foods for our unique body, and working up a sweat helps to accumulate more vitality and wellness, so do the right spending and budgeting habits help us to build better financial health. Here are 5 ways to check up on your personal finance fitness:

Automate savings.

Setting up automatic transfers to your checking account is a great way to manage your money ? effortlessly. There are even free automatic savings apps that calculate the right amount of money to set aside each day based on your income and savings.

Cut recurring expenses.

Make extra room in your budget by reducing and eliminating recurring monthly expenses, like your cable bill, cell phone plan, gym membership, or other monthly subscriptions.

Pro-tip: ?Review and compare price options. For your TV package or mobile data allotment, you may be able to opt for a lower-cost plan without affecting your usage level. ?

Switch banks.

Eliminating bank fees is a quick and easy way to cut costs and free up extra funds that can go towards your other financial goals. Take a few minutes to look up the fees associated with your checking account because if you are being charged a monthly maintenance fee or any other fee, it?s time to switch banks!

Pro-tip: ?Banks like Aspiration have free ATMs and no fees.

Compare insurance rates. Raise deductibles.

Insurance rates often change so it?s important to comparison shop for coverage, especially if it?s been a few years to net the best price. Spending 10-15 minutes on this research could end up saving you hundreds of dollars. ?Consumers can also save by raising their deductible or dropping coverage levels.

Sell unwanted items.

Let spring cleaning come early this year and look through your closet or attic for any items that no longer serve you. Selling your old furniture, jewelry, or clothing on eBay can be a simple way to save a lot of money for the future. Technology has made this easier than ever ? even Facebook provides the opportunity to sell your used items to friends.

Here?s how to Build an ?F-you? Fund (and why you should have one) ? Yahoo Finance

First off, what is an ?F-you? fund? Basically, it is a beefed-up emergency fund worth at least 6-8 months of expenses. This is befitting for those who are in a career slump and in the process of seeking out new job opportunities. The ?F-you? fund is a humorous way to ensure you don?t feel like you?ve reached a dead-end in your career. Here?s how to get started on your financial freedom journey:

Step 1: Know your numbers.

Setting 6-8 months of expenses aside is a great amount of time so that if you ever needed to switch from careers, you wouldn?t need to desperately grasp the next available job. ??For example, if you know that your expenses are $3,000 per month, then you would need an $18,000 minimum in that ?F-you? fund.

Step 2: ?Live below your means.

Forging a path in this new fund will involve a little bit of sacrifice. Whether it?s skipping out on the weekend with your friends or replacing that daily coffee run with your own french press, find small ways to save big. Living outside of what you can afford is not worth the extra time it will take to build your emergency fund.

Step 3: ?Pay yourself automatically.

Add money to your savings account automatically, that way you are less tempted to overindulge in unneeded purchases. An easy way to do that is to open an account in a different bank, that way you don?t see it but it?s building for you behind the scenes.

Step 4: ?Keep it out of reach.

Keep your F-you fund completely out of reach so you are not tempted to slip into that savings account. No matter how strong the willpower is, having access to that money could lead to an eventual cave-in spending session.

Step 5: ?Keep your emotions in check.

The attitude you put into your emergency savings fund is just as important as the money. Redesign your mindset to match your higher vision for personal finances. Here?s a money mantra example:

?…I want to protect myself, I want to protect my financial freedom, I want to protect my creative freedom, I just want to make sure that in the worst case scenario, I don?t feel stuck at a job.? ?- Ash Exantus

Breaking Bad Financial Habits Once and For All ? CNBC

One of the most important steps to cultivating financial freedom is to simply create a concrete game plan for how you want to pay down debt. Considering the average American credit card balance is $6,375, it?s clear that some new money spending habits are in order. Here are several important factors to kicking debt habits to the curb:

Figure out your rate of return.

Take a look at the interest rate of your loan compared to the rate of return it could possibly earn with that cash. Ultimately, if you can earn more on that investment than you?re paying on the debt, you?re probably better off keeping the debt because you could earn more with that cash than you are paying.

Prioritize your payments.

Start out by making a list of your debts, including the balances and interest rates. After that, prioritize the loans you pay off by the interest rate (aka the avalanche method.) Essentially, you are attacking the highest cost debts first.

Pro-tip: ?Another popular debt payment method is the snowball method, whereby you pay off the debts from smallest to largest. ?This can be more expensive, however, because it does not take interest into account.

Weigh good debt vs. bad debt.

Different types of debt actually affect your life in different negative and positive ways. Your mortgage, for instance, is a debt that helps you set up for long-term goals. Other examples of positive impact debt could be home or student loans as they are ultimately there to help you build an asset. Conversely, depreciating assets that are not tax deductible like credit cards, are bad debt. Keep it simple and avoid the bad debt as much as possible.

Take your feelings into account.

Peace of mind is invaluable. Go at your own pace and pay off debt at a reasonable level. In the end, having less debt could mean a better night?s sleep, easier retirement, and more financial freedom in the future.

Photo by Alex Wong


Your Money in the News ? Jan 21st

This week: Making the most out of your money agenda, which generations are racking up the most debt, avoiding financial deception, breaking the debt cycle, and how many credits you should really have.

7 Tips to Make the Most Out of Your 2018 Money Agenda ? The Huffington Post

Financial resolutions are nothing new under the sun. In fact, four thousand years ago the Babylonians became the first society to make New Year?s resolutions (and historic records show they even made promises to the gods to pay off debts!) Getting serious about savings and making a solid financial plan are important elements to starting 2018 in a strong way. It?s time to sit down and get the agenda set. Here are 7 tips to get the ball rolling:

  • Know your (money) pitfalls. It?s important to know your weakness. Whether it?s a bad financial habit you want to break (bye-bye daily latte stops), r a goal you didn?t quite meet, just being mindful about your spending habits can help you adapt or adopt new ones.
  • Create a short-term goal ( achievable 2018). Break down big goals into smaller, bite-sized pieces. For example, rather than totally going debt-free in one year, rethink spending habits and create a budget to follow.
  • Identify those long-term goals too. Think big picture like retirement plans or whatever keeps you motivated through 2018 and beyond.
  • Make a list of the tools you need. Whether it?s a mobile app (e.g. the conscious banking app from Aspiration), books, or other online resources, find the right tools that motivate and inspire you to save smarter, budget better, and invest more wisely.
  • Choose your team. It could be a partner, spouse, or even friends or family ? just find a financial accountability partner to hold you accountable for your money dreams.
  • Make time. With busy daily agendas, people find it hard to think about personal finances. Simply making a conscious decision to scroll a little less on social media and sit down for 5 minutes to curate a budget can literally turn finances around completely.
  • Allow room for setbacks. It?s ok to mess up. Allow room for potential setbacks in your budget/financial planning. What?s most important is to begin and remember that any progress is one step closer to achieving prosperity in your personal finances.

Which Generation is Racking Up the Worst Debt and Credit Scores? ? USA Today

American credit card debt has become a trendy topic in today?s headlines, but who really tallies up the most debt (and worst credit scores?) Just last year, the U.S. debt hit a record 1.02 trillion according to the Federal Reserve. Let?s talk about which generations racks up the most points to get a different perspective on debt in America:

Generation Z.

Ranging from ages 18-20, Generation Z had an average credit score of 634. This is an age group that is just getting started on establishing credit and they typically have an average of just 1.44 credit cards per person. A typical credit card balance was $2,047 for them.


This age group (21-34) is perhaps one of the most talked about, especially on social media. Their average credit score is 638. ?The overall debt for millennials is around $222,000 and they have increased their mortgage debt to $198,303.

Generation X.

Gen Xers (35-49) have an average credit score of 658 and they have accrued the highest average mortgage debt of all the age groups at $231,774. This group also had the highest rate of late debt payments at 0.54%. For Gen Xers, their average non-mortgage debt was at $30,334.

Baby Boomers.

This generation, ranging from ages 50-70, has an average credit score of 703 and their average mortgage debt is $188,828. Financially, they?re in pretty good shape with a low late payments rate of 0.3%.

Silent Generation.

This group, (age 70 plus) has an average credit score of 729 and an average mortgage debt of $156,705. ?Better yet, their other debts are low which is why their late payment frequency is at 0.12%.

2 Simple Steps to Avoiding Financial Deception ? Forbes

As technology progresses, the ways financial companies can coerce us into believing they are there to improve our lives can be overwhelming. Now, more than ever, it is important to get smarter about our personal finances. ?The more we learn, the more empowered we become, and the less likely we are to fall victim to schemes. Here are 2 simple ways to sniff out financial deception and stay afloat:

  • Only work with a full-time fiduciary.

One of the reasons it?s paramount to get picky about choosing your financial fiduciary is because many who claim they are fiduciaries are only part-time financial advisors. ?Set your own, strict standard by choosing to only work with a full-time fiduciary.

Pro-tip: ?If you?re looking to get something in writing, the strongest and clearest language can be found in the Fiduciary Oath which is required of anyone who is a member of the National Association of Personal Financial Advisors (NAPFA.)

  • Only work with an advisor who puts you at the center of planning.

Not every fiduciary is a good advisor, so due diligence is essential to finding the right fit. Any advisor insists that their investment philosophy or planning process is the secret to your success is to be wary of. What are some signs that you?re working with a self-centered planner?

  • They dominate the conversation with their accomplishments (or their firm?s success.)
  • They state that your recommendations are generic or aren?t framed within the context of your own values and goals.

What about the signs that you are working with a client-centered planner? Simply put,

  • You remain the focus on both the micro and macro level.

Every planning engagement should begin with what?s most important to you and your family (before even moving on to your money.) Later on, each conversation with your financial advisor should fly back to your values and your goals.

The U.S. Debt Stats Are In ? Now Let?s Break this Damaging Cycle ? The Motley Fool

It?s hard not to grimace at the latest credit card debt stats. In fact, U.S. credit card debt reached an all-time high in 2017 and the average American household debt was around $16,000. Why is it that 68% of U.S. adults have no idea how to handle their debt (or even think they?ll be debt-free?) Let?s find out why Americans are dealing with more debt than ever and how we can strategize a plan to pay it off, once and for all.

Why all the debt?

The answer is fairly simple: Americans tend to live paycheck to paycheck without any long-term savings set aside. In fact, 59% of U.S. adults have less than $1,000 of savings in the bank and 39% have no savings. Period.

This explains why people with no savings tend to eagerly swipe their credit cards when unexpected expenses hit. It becomes a vicious cycle: not paying the credit card bill in full, carrying that balance, and accruing that interest.

How do we break this cycle?

Forget becoming another statistic, you can get out of debt.

Step 1: You have to be willing to change the way you manage and spend your money. ?Following a budget is necessary to narrow your path and steer you clear of debt. Write down expenses, find out where your money is allocated daily, weekly, monthly, and yearly. Of course, it?s important to cut out any unnecessary costs, especially during the beginning stages.

Step 2: Find a side gig that fits your interests. Whether you work as a freelance writer, sell items on eBay, or drive for Uber, bringing in a secondary income is an excellent way to make more while you save more.

Step 3: After making more cash monthly, come up with a solid plan for paying off debt. Take a peek at your various credit cards, find out which ones charge the most interest, and work on paying off the highest first.

Pro-tip: ?Consider contacting each credit card company you owe money to and asking them for an interest rate reduction. If you have a history of making your monthly payments on time, your credit card company may comply.

Step 4: If you have a good credit score, consider looking into a balance transfer offer. Transferring existing balances onto a single card with a lower interest rate means you will spend less to pay off your debt and have an easier time managing it.

Credit Cards At a Glance ? How Many Should You Have Anyway? ? CNBC

Credit cards can become a transformational tool to help you make important purchases, build credit, and earn valuable perks ? but with great power comes great responsibility! Let?s uncover the answers to one of the most commonly asked credit card questions so we can swipe a bit more responsibly next time.

What?s the magic number?

The average American holds 3.1 cards (with an average balance of $6,354), but there?s no one-size-fits-all answer. In truth, it depends on just what you will be using the credit card for. It?s also important that you become disciplined about paying the balance in full each month. If you feel confident that you are able to pay off your entire balance every month, opening more credit cards could actually boost your credit score.

Pro-tip: ?Part of your credit score is determined by the credit utilization ratio. ?You can get this number by dividing your balance by your credit limit. You?ll want to use 10% of your available credit line, if possible (and no more than 30%.)

What happens after you open your new card?

After you open the new card, the amount of the overall credit available to you actually increases. Assuming your spending habits stay the same, your credit utilization ratio will automatically improve. Not to mention, with regular use, your credit card can offer a host of perks like airline miles, hotel points, and cash back. Find a card that suits your lifestyle, and it could pay off big time in the future.

The bottom line.

If you have tendencies to overspend, you?re better off sticking to fewer cards or even zeroing out your use of them. Most importantly, are you paying off the balance in full every month? A ?yes?, means you?re prepared to go out and open up more cards and utilize different cards for different purposes.

Photo by Andres Garcia?


Your Money in the News ??Jan 9th

This week: Financial fitness tips, having more fun without breaking the bank, top books for better money making skills, 2018 money goals, why you should never hire a hacker.

12 Financial Fitness Tips for the Next 12 Months ? Forbes

Kicking off 2018 in the right financial state of mind means starting slow, implementing a solid plan, and taking it one month at a time. Rather than burning out with unrealistic debt-bashing strategies, or hard-core budgeting, consider these solid financial plans that could help you ease into the new year with lasting results.

  • Plot out a personal savings goal for the year. Keep it simple and align both your monthly and yearly savings goals. Find out how much you can realistically save each month and stick with it. Keep your year-end goal in mind for motivation.
  • Make an emergency savings fund a top priority. Typically, a rainy day fund should be sufficient enough to cover 3-6 months of your expenses.
  • Organize your retirement accounts. Do you have a 401(k) or an IRA? If not, make that a top priority. For instance, if your company offers a 401(k) and matches what you put in up to a certain amount, consider signing up for it.
  • Take a little budget-friendly trip. A great way to stay afloat financially is to be motivated to make more. Planning future trips reminds us of what financial independence can feel like. Even if it?s small, set money aside for fun and keep plugging along.
  • Track your expenses. First, keep track of basic expenses such as rent, utilities, and other bills. After that, be mindful of how much is spent on eating out, movies, etc. Pro tip: ?Banks like Aspiration have an app that makes it easy to keep track of what you spend with your debit card. Plus, with every dollar you spend, the app gives People/Planet score to reveal whether a business is good to their employees and the planet, or not.
  • Make a budget. Creating a budget is best, but make sure it?s one that you can actually follow through with. Ultimately, keeping track of expenses is a prerequisite to better budgeting.
  • Invest in something you believe in. Technology ETFs, real estate funds, or cryptocurrencies are also examples to invest in. They key is to investigate what interests you. It doesn?t have to impose on your budget either ? you can start impact investing for as little as $50.
  • Find out about investing beyond your retirement account. Basically, you need an investment account that you can use in the more immediate future, rather than only having investments you don?t touch until you?re 60.
  • Knockdown credit card debt. Rule of thumb: pay down high-interest rates first (like credit card debt), then move on to lower interest rates like student loans.
  • Find a credit card that will actually get you great rewards. Whether you prefer a cash rewards card or a travel card, make certain the rewards offered are ones you will really cash in on.
  • Have the money talk. ?Whether you?re married or moving in together, talking finances with your partner help to align your financial goals and money habits.
  • Plan on asking for a raise. A new year means a new opportunity to earn more money. Chart out when you might want to bring up the money talk with your boss and ask for that raise. ?

Here?s How to Have Fun (without Breaking the Bank) ? USA Today

Whether it?s a nice meal at a restaurant or tickets to see your favorite show, going out for a good time can often rack up unnecessary costs, especially for those with a budget in mind. Americans spend on average almost $3,000 per year on entertainment (4% of the family budget!) So, how do we have fun without breaking the bank? Here 4 popular entertainment categories to restyle:

Eating out.

Cost-effective solutions: ?Vying for dinner at that fancy new restaurant? Why not look at the lunch menu instead for lower costs. Happy hour specials are often less, and many restaurants offer special nights (e.g. half-price burger night) or have coupons.

Theater, concerts, sporting events, etc.

Cost-effective solutions: ?Find fun, free events. Many communities have events such as plays, sporting events, and gallery openings that are at no cost. You could consider volunteering at your local theater or offering to take tickets at sporting events. Don?t forget to check for special nights. Some theaters offer cheaper preview performances and some venues offer last-minute rush tickets for unsold seats at lower prices. Even going on an off day (aka not the weekend) when prices are cheaper can be a great alternative.

Outdoor activities.

Cost-effective solutions: ?Rather than paying to be seated at an outdoor activity, why not seek out free activities? Hiking, bicycling, and sports activities like volleyball or local basketball are wholesome ways to connect with community, exercise, and save a buck or two.

Entertainment at home.

Cost-effective solutions: ?For starters, cutting back on entertainment services can be a huge way to save money as the cost of cable can certainly to drain your budget. Consider cutting the cable cord once and for all, and renting movies online. Even local libraries offer free music, movies, and ebooks. Rather than rack up money at the movie theater, why not plan a movie night with friends? Making your own snacks can save you from the concession wallet drain.

Top 6 Books to Motivate Better Money Making Skills ? CNBC

Observe the lives of financially prosperous people and you will find a repeated discipline: the majority of these wealthy people devote at least 30 minutes a day to reading. From personal finance classics to new releases, here are 6 powerful reads to activate your financial inspiration for 2018, and get you on a prosperous path:

  • ?Think and Grow Rich? by Napoleon Hill. A personal finance classic, ?Think and Grow Rich? helps readers understand that your mindset affects your financial outcome more than anything else.
  • ?Business Adventures? by John Brooks. Despite being published in 1969, this book holds the fundamentals of building a strong business.
  • ?Your Money or Your Life? by Vicki Robin, Joe Dominguez, and Monique Tilford. A book with the idea that you exchange your time for your money as it encourages people to start reconsidering how many hours of life are expended to save money to buy something.
  • ?Unshakeable? by Tony Robbins. This book teaches you that if you focus on what you can control, you can be the master of your investment fate.
  • ?The Little Book of Common Sense Investing? by John C. Bogle. A book about building wealth and investing wisely.
  • ?The Automatic Millionaire? by David Bach. In this read, the author exposes a wide variety of money misconceptions and you?ll learn that you don’t need a budget, you don’t need to make a lot of money and you don’t even need the willpower to make a fortune.

In a Nutshell: How to Build the Best Financial Goals for 2018 ? CBS News

A new year often incites new money goals for folks. In fact, 76% of Americans believe that they?ll be better off financially in 2018. Enthusiasm is great, but what does it really take to have your best financial year yet? Below are the basics to build a better financial goal, one that will lead to prosperity for years to come.

But first things first ? is there any holiday debt?

If you have incurred any debt on your credit card over the holidays, plan on paying that down, ASAP. Before you get started on building new goals, make sure to take care of old business matters first.

Secondly, did you drain money out of your emergency reserve fund?

If the answer is yes, make sure you focus on adding more money to your rainy day fund ? at least 6 months of your living expenses should be kept safe.

After those two tasks are accomplished, you can focus on the next step:

Retirement plan contributions.

Simply put, try to maximize your retirement contributions as much as possible. For instance, in 2018, the 401(k) limit for participating employees is $18,500 (that?s $500 more than last year.)

For people 50 plus, the catch-up contribution limit is $6,000 for a total of $24,500.

As for IRA or Roth IRAs, contributions remain at $5,500, and $6,500 for people over 50.

Don?t forget about investments.

Now is the time to assess what you have in stock for investments. Take a look at what you have, find out what?s in your retirement account, and consider rebalancing it. For instance, if you?re the type of investor who loathes risk (you?re a balanced investor), you may have started 2017 saying 50% stocks and 50% bonds. Because the markets were good, you could have 70% in stocks right now and could take some of the money out of the stocks, move it into the bonds, and rebalance those allocations. ?Don?t forget to rebalance your 401(k) as well, as you don?t want to take any unnecessary risks.

Pro-tip: ?Track your expenses and get your annual credit report to ensure there are no errors.

Here?s Why You Should Think Twice Before Hiring a Hacker to Fix Your Credit Score ? The Huffington Post

At the moment, there is an unusual trend buzzing around the personal finance interweb: hiring a hacker to fix their credit score. If a gleaming 800-level FICO score sounds a little too good to be true, take a look at these top reasons why amping up for credit artificially, is anything but financially wise:

#1. It creates a major risk for identity theft.

While it?s tempting to hire someone to hack into the credit bureaus and change a 4 to a 7 so you can get a good rate, the downsides far outweigh any instant gratification. Turning over sensitive information like your name, address, birth date, Social Security numbers, etc. to hackers opens up the opportunity for stolen identity and further damaged credit.

#2. It?s simply too good to be true.

Just because you see a myriad of comments complimenting the hacker?s service and skills, does not mean they ring true. Look more closely, and you?ll notice poor grammar, spelling, and repeated comments on the website.

Here?s the solution:

Hack your own credit score!

Why hire a hacker to fix your score when the power to alter its outcome is in your hands? It won?t be fast, but it will be worth it. Here are the steps to reshaping your current credit score situation:

Step 1: ?Check your current credit score.

Federal law allows you to get a free copy of your credit score every year from each credit reporting company (TransUnion, Experian, and Equifax.)

Step 2: ?Find the errors that could be bringing your score down.

Check each report to make sure all the information is accurate, and if you find an error tell the credit bureau right away so you can dispute it.

Step 3: ?Work on the things that cultivate a good credit score.

It sounds like a simple discipline, but putting money towards paying off your debt is a great start. Don?t forget to call your lender and work out a payment plan, if that?s necessary. It?s also important to be upfront with your credit card company and see if you can negotiate any ?dings? on your report.

Pro-tip: ?Improve your credit optimization. If you are able to extend your credit limit, it could improve this ratio.

Step 4: ?Only hire a legitimate credit repair service.

Finding a legitimate credit repair service, one that works within government regulations, is crucial. How do you know if a credit repair company plays by the rules? The consumer protection bureau set up these ground rules: they must have an easy cancellation policy, not promise an increase in credit score, and not take money upfront before agreed-upon services have been performed. ?

The bottom line: ?Find a company who abides by these rules, and you?ve got yourself a legit credit repair company.

Photo by Louis Amal?


Your Money in the News ? Dec 26th

This week: New Year?s Debt Resolutions, Settling Student Loan Debts, Money Mind Hacks, Buying Life Insurance, Are Your Rewards Cards Really Worth it?

4 Tricks to Tame Your New Year?s Debt Resolutions ? USA Today

The anticipation of 2018 often includes lofty goals and claims of debt resolution. Why not ring in the new year right with some savvy ways to put your money where your mouth is? Here are 4 tricks to keep your new year?s debt resolutions in check:

  • Add up the facts to know what you really owe.

A little money mindfulness can go a long way. Take an inventory of your debts and interest. Understand exactly what it will take to pay them down. This gives you a realistic view of your next step and provides you with a vision of being debt-free.

  • Create daily debt-tackling tasks.

Break down your quest into smaller chunks and tackle them one at a time. Day 1 could look like figuring out how much you can put towards your debt each month. Day 2 could be choosing how you?ll approach paying off the debt, and day 3 could involve trimming expenses and brainstorming ways to earn additional income in order to find more money for debt paydown.

  • Stay focused. Keep yourself accountable.

Updating a friend about your progress each month or using financial apps to help keep you on track are awesome ways to stay focused on your plans for the new year. Find what inspires you to move forward and make those payments on time.

  • Don?t forget to have a little fun.

If personal finances become too doom and gloom, it can be difficult to sustain focus. Find little ways to stay encouraged. It could mean building in rewards as you make progress. Just paid off $100? Why not give yourself a little treat like fine chocolate or a top shelf glass of wine to celebrate?

Let 2018 Be the Year to Settle Student Debts (Once and For All) ? Forbes

If student loan debt is a subject that makes your skin crawl, you?re not alone. In fact, a whopping 61% of borrowers worry that their student loan stress is completely out of control. ?A new year is just around the corner and It?s time to shift gears into the right mindset so you can pay off those loans at last. Here are 5 important steps you can take to pay off student loan debts in 2018:

  • Go the extra mile with your payments.

If paying off student loan debt within the next year is a serious focal point of yours, consider making extra payments. Since the default payment period is 10 years and the initial balance plus interest will be broken into 120 payments, you?ll want to make payments that are double ? even triple your monthly payment.

Pro-tip: ?Make your payments automatic for extra effectiveness. It?s one less thing to think about (or forget about), and that way you?ll avoid spending money on things that are not on the top of the list. In addition, many student loan services offer an interest rate discount when you set up an autopay.

  • Start with high-interest rates first.

Tackling student debt more aggressively begins with paying down high-interest rates first. ?It?s simple: more of your payments will go towards lowering your balance instead of paying interest. Consider the ?debt avalanche? strategy, it?s pretty simple:

Step 1: ?Order your student loans from highest interest rate to the lowest.

Step 2: ?Apply extra payments towards the high-interest rate first (this method saves you the most in interest over time.)

  • Earn. More. Money.

The more you make, the more you can put towards paying off your debts. Keep it simple. It could be extra income from gifts, tax refunds, bonuses, or even a side gig. Don?t be shy about asking for a raise or even starting a job search for a higher salary. ?Every action step counts towards more financial freedom and less debt.

  • Cut down on major expenses.

In addition to increasing your income, look at where you can trim big expenses like transportation, housing, and food. Compare how much you make to what you spend. A change in transportation, a move to lower cost housing or a change in eating habits may help to increase your student loan payment.

  • Find a money mentor.

Psychology studies remind us that those we spend the most time around impact the choices we make ? even financially. Choose money mentors wisely. Whether it?s a one-on-one coach or a popular podcast, learn from the best and watch your results carefully.

3 Reasons to Consider Buying Life Insurance (Even If You?re Single!) ? Market Watch

Buying the right life insurance may seem like a decision you should make once you?ve settled down and started a family, but what if you?re single? Let?s take a look at 3 stellar reasons to start looking for life insurance, regardless of your age or relationship status

  • You can use it to retire debt.

Though state laws vary, assets owned at death are often reduced by outstanding liabilities, before they are passed to the heirs. Interestingly enough, having an insurance policy with a death benefit that is equal to the current amount owed (e.g. mortgages, auto loans, credit card debts), can help ensure that your entire estate can be passed to loved ones.

Side note: ?If your student loan debt is federally sponsored, it can be discharged upon death, however private loans are generally not forgiven upon death and should be included when calculating the amount of life insurance to buy.

  • You can get access to accelerated benefits.

Today, most life insurance policies sold will include a provision that accelerates a large percentage of the death benefit during your lifetime upon the diagnosis of a terminal condition. This policy typically defines a terminal condition as one which is expected to result in death within a specific period of time (sometimes 12 months.) Accelerated benefits can give you access to medical procedures and treatments that may not be covered by your health insurance.

  • You can guarantee insurability later in life.

Typically, life insurance companies will ask about your medical history and some conditions can increase your premiums, or lead to an insurer declining to issue a policy. If you purchase when you?re younger and healthier, it could lock in access to coverage later. It?s also important to note that older applicants are typically charged higher premiums than younger insurers, so the sooner you start shopping, the sooner you can lock in lower premiums.

Pro tip: ?A good time to purchase a policy is right after an increase in your income, so you can use the new money that has not been allocated to other expenses yet.

12 Money Mindsets to Help Kick Debt to the Curb ? U.S. News

Money and psychology play intricate roles in the outcome of our financial lives. It?s a well-documented fact that our thoughts affect our finances. Skip the scarcity mindset and take a look at 12 money mind hacks to get your finances back on track:

  • Reframe your thoughts. What we think becomes our reality ? especially in finances. Simply focus on becoming debt-free and envision what life would feel and look like with that type of freedom.
  • Let go of your fear of debt. Dwelling upon the fear of debt can become a major roadblock in becoming free of it. Rather than run from it, face it. Simply assessing your current account balances is a great action step towards understanding and eliminating your total debt.
  • Envision a debt-free life. Actually taking the time to sit and visualize a life without the burden of debt is a useful tool in eliminating it. Imagining yourself paying off the debt gives one a brief taste of what it?s like to actually be debt-free life. Plus your brain?s Reticular Activating System cannot differentiate between something that is vividly imagined or real.
  • Let go of limiting beliefs. Limiting beliefs can be described as thoughts that inhibit or interfere with certain behaviors and actions. Being ?stuck in debt? is an example of a limiting belief that can become destructive. Even just writing down these types of phrases can help us get rid of them.
  • Keep a list of reasons for paying down debt. Whether it?s inspiration to buy a home, or a strong desire to eradicate stress, write down any and all reasons you want to pay down your debt.
  • Build momentum: ?pay down small bills first. Keep it simple and focus on paying off smaller debts first to build momentum. Every little bit paid off is a step closer to living debt-free.
  • Don?t let willpower get in the way. Aim to automate your payments so you can systematize the actions that need to be done. It will keep the extra money out of sight and out of mind.
  • Track progress. Stay motivated. Simplicity is key: ?write down each debt and track repayment activities. This also offers an opportunity to look back and see your progress.
  • Establish a rewards system to avoid burnout. Each small milestone you reach in your personal finances is deserving of celebration. However, be careful that the reward doesn?t backfire ? ?stick to your budget.
  • Find someone to keep you accountable. No need to go this journey alone. Talk to friends, family, or find a mentor. If that person is also working towards a financial goal, even better.
  • Identify your emotional spending triggers. Watch your emotions before you spend. Some shop to boost their moods, others overspend when they are happy. Give yourself a waiting period, such as 48 hours, before reacting to an impulse to buy something.
  • Stick with cash to avoid impulse spending. A great remedy for impulse buys is to limit credit card use and stick with cash purchases. Physically handing over cash is harder than swiping a card. Also, checking your account balances before you shop can curtail unnecessary purchases.

Are Your Credit Card Rewards Really Worth It? ? The Huffington Post

?Tis the season to over swipe our credit cards. Even worse, the flashy advertisements touting a long list of presumed benefits are tantalizingly untrue. Considering the fact that by December 31st, credit card debt in the U.S. for 2017 is estimated to reach $905 billion, it?s time to rethink the way we swipe and upgrade spending habits. Are credit card rewards really worth it? Here are 4 ways your credit card could be ripping you off:

Airline credit cards are not what they seem.

The amount you end up charging in addition to your annual fee can make the actual cost of purchasing a ticket without using miles less. Sadly, some miles expire before you even get the chance to use them. ?Airlines sell miles to banks who then use the miles as a signing bonus to push customers into applying for credit cards. Because there is a ?great deal of competition for available seats, flights are often unbookable with miles. In addition, the mileage costs for claiming a flight keeps increasing.

Some cash-back cards don?t even give actual cash back.

You literally have to spend thousands on a credit card in order to get even $100 cash back. In many cases, it?s probably just a credit applied to your account, not real ?cash? in your pocket. In fact, cash-back cards do not generally even give cash or credit back on every purchase, and they often have a strict limit on the maximum amount they will give back to customers in a billing period or year.

It?s not cheap to break even, on Amazon?s ?5 percent back? card.

In order to qualify for Amazon?s new 5 percent back card, you have to be an Amazon Prime member (that?s $99 per year.) You would have to spend $4,950 annually on Amazon to actually break even on the Amazon Prime Rewards Visa Signature Card?s ?5 percent back? promise. If you subscribe to Prime anyway, great. If not, review your Amazon orders from last year to see if your spending near the $4,950 minimum.

Store cards can be skimpy on the rewards.

Stores like Gap, Old Navy, and the Banana Republic can offer up to 40% off if you charge your purchases to their store credit card. These cardholders may get free shipping twice a year, or random 20% off coupons, but how much are you actually saving when you have to spend a minimum amount when you shop? And if you aren?t paying the balances in full monthly, the interest rates will exceed the discounts offered.

Pro-tip: ?Analyze where you?re spending money. If the card is dictating your purchases or where you make them, you?re probably not being smart about its use. You spend more when you use plastic, so try swapping credit for cash.

Photo by Ariel Lustre?


Your Money in the News ? Dec 10th

This week: mindsets to mend overspending habits, workplace happiness, debt tackling tactics, 2018 money mantras, personal finance happiness

4 Powerful Mindsets that Zap Your Overspending Habits ? CNN Money

Overspending is a nasty habit that is not diminished by making more money. Whether someone makes $30,000 or $500,000, people still struggle with over-swiping their credit cards. ?The fact that outstanding credit card debt topped $1 trillion in the first quarter of 2017 should send huge warning signals that our overspending needs to be addressed. How do we shift gears into money mindfulness? Here are 4 important mindsets to try out next time you are tempted to get carried away at the checkout line.

Embrace the reality of your financial situation.

Taking the time to sit down and look at your financial facts on paper can effectively shift your perspective. An honest look at your spending habits starts with investigating everything you spent money on in the last few months. Examine money spent on housing, food, gas, entertainment, and clothes. Know exactly where your money is going. It may be painful but if you have the courage to dive deeper into your financial awareness, you can create more financial freedom for your future.

Pro-tip: ?If you need the extra push to embark on your financial investigation, look into the latest money apps that are designed to do the heavy lifting for you. (Mint and Wally are popular downloads.)

Budgeting doesn?t have to be a bore.

After analyzing your daily spending habits, it?s time to create a custom-fit budget. If the ?b? word brings up bitter sentiments in your mind, it?s time to rethink what the word really means. Rather than allowing budgeting to become a dreaded topic, realize that it?s a powerful tool and one of the key components to managing money (especially when you are trying to pay down your credit cards.) Budgeting is trial and error. There?s no one-size-fits-all. ?

Pro-tip: There are a variety of budgeting techniques designed to help you out. Consider the envelope budget: ?figure out how much money you want to spend on each element of your life, then put said cash in a labeled envelope. When the cash is in the envelope, you?re done for the month.

Cash is a powerful way to cut spending costs.

?It sounds simple, but practicing a cash-only spending discipline could make a major difference in your financial outcome. Try only using cash next time you line up at the register. It can help curb spending and provide a tangible indication of how much money is leaving your possession. Even opting for your debit card can make a difference in your spending habits. Focus on keeping within the boundaries of what funds you actually have available.

Small spending alterations can make a major difference.

Little decisions to improve financial awareness can add up to a meaningful change in your life and save you big time. Mindful spending can look like cutting back on your coffee trips occasionally, or how often you eat out with friends. Simplify saving tactics by focusing on one area at a time. For example, try just focusing on ways to spend less on food.

The Stats Are In: ?Workers Can?t Get No Financial Satisfaction ? CNBC

According to a recent report, only 35% of U.S. workers are actually satisfied with their financial situation. Contrast those statistics with the 48% satisfaction rate from 2015, and you have a major case of a negative money outlook. In fact, one-third of the workers from this poll also said their current financial concerns are affecting their lives in a negative way.

So, what?s causing spiraling, financial negativity?

According to the poll, 50% of the workers said they had experienced a major, negative financial event including:

  • Going through an expensive divorce.
  • Borrowing money from friends and family.
  • Incurring a significant medical expense.

Rates and debt are rising faster and higher than wages. To top it all off, Americans simply aren?t saving enough money for emergencies. Nearly a quarter of Americans have no emergency savings. Period. ?Sadly, when it comes to debt and loans, Americans are in even worse shape. This recent stat shows that the average household credit card debt was $7,996 during the second quarter of 2017 (that?s up 5% from a year earlier.)

What?s the good news?

Despite the current statistics, there are solutions to this lack of financial satisfaction in the workplace. Employers can help frustrated workers by establishing programs and financial counseling tools that are designed to assist them in making better financial decisions. Ultimately, it?s up to the worker to take this information and learn to make better financial choices. It?s time to take the lead in managing your own finances.

Pro-tip: ?There are countless forms of support to guide you along the way (Hello personal finance apps!)

3 Straightforward Ways to Demolish Debt ? Forbes

In a rising rate environment, how does one stay afloat financially? As the Federal Reserve increases interest rates, your credit card rate will become more expensive. But the good news is that there are ways to reduce (or even eliminate) credit card interest. Take a look at three solid strategies that can help you deal with expensive debt.

A Balance Transfer.?

A balance transfer will enable you to pay a low introductory rate for a fixed number of months. While some balance transfers have fees, there are others that do not (make sure to do the math first before the transfer.) If you think it will take 18 months or longer, a balance transfer fee will usually pay for itself, but if you think you can pay it off in 6 months, it probably makes sense not to transfer the debt. Pro-tip: ?Sites like NerdWallet and MagnifyMoney can assist you in finding the best balance transfer offers. Take note that you are typically not allowed to transfer debt between two credit cards of the same issuer (pay close attention to co-brand credit cards.) Avoid the temptation of the lower monthly payment as your monthly payment will likely go down during the promotional period. Simply put, pay as much as you can towards the debt!

A Personal Loan.

Personal loans can offer a lower-cost alternative to credit card debt. They typically have a fixed interest rate, so if the interest rate rises, you will not be stuck paying a high rate (unlike most credit card contracts.) With a personal loan, one can actually shop for their rate without impacting their score at most lenders.

Pro-tip: ?Mind your origination fee. Comparing APR?s is a great way to shop if you do not plan on paying off your loan early. If paying off your loan early is your thing, you may want to avoid a loan with an origination fee.

Ask Your Credit Card Company for a Lower Rate.

While the best way to reduce your interest rate dramatically is by way of a balance transfer or personal loan, making a simple call to your credit card company and asking for a lower rate is a great trick.

Heads up: ?The interest rate reduction will not be massive, but every little bit can help. Lowering your rate is a powerful way to get out of debt even faster, just make sure you do not continue adding to it.

Ring in the New Year RIght: 5 Major Money Making Mistakes to Avoid in 2018 ? The Motley Fool

As we close in 2017 and approach a new year, it?s common to have financial concerns buzzing through our brain. This is a time to take a deep breath and realize how far we?ve come with our personal finances and overall goals. This upcoming year offers a fresh financial start so let?s take a look at 5 money mistakes to avoid while we navigate through 2018.

Forgetting your emergency fund.?

?Neglecting to contribute to one?s emergency fund is actually quite commonplace. A whopping 57% of U.S. adults have less than $1,000 in the bank, while 39% have zero savings. That?s a scary thought because the longer you go without a safety net, the more you put your finances at risk. It?s a great idea to have at least three months? worth of living expenses set aside. Bonus points if you can set aside 6 months of expenses.

Not contributing to a tax-advantaged retirement plan.

Saving for retirement is super important and it?s crucial to take steps to lower taxes, but if you don?t contribute to your retirement plan next year, it could interfere on both fronts. For instance, in 2018, you can put $18,500 into your 401k if you are under 50. Are you 50 or older? You could get a $6,000 catch-up that raises this limit to $24,500.

Avoiding investments in stocks.

Putting money aside for retirement is awesome, but not investing it could be a complete disservice to your portfolio. In fact, 60% of Americans are investing too conservatively for retirement (which means the potential of not having enough income to fund their golden years.) While it?s true that bonds are a more stable investment, they also give a much lower return over time. Consider switching up your strategy and adding stocks to your portfolio.

Adding up credit card debt.

If you want to come out financially clean in 2018, avoid racking up credit card debt at all costs. More debt means more interest charges, and that?s especially harmful if you want to borrow money in the future. Avoid becoming a credit card debt statistic. Stick with a budget, save wisely, and pay off high-interest rate cards first.

Buying too much house.

The fact that 39 million Americans cannot actually afford their homes is a huge red flag that spending habits need to change. As always, think twice before investing a home purchase that you know you?ll struggle to keep up with.

Pro-tip: ?As a rule of thumb, your housing costs should never exceed 30% of your take-home pay. Resist the urge to buy a home that is bigger than you actually need, and adjust your expectations accordingly.

Do Good Personal Finance Habits Equal Happiness? ? Psychology Today

We often hear people debate whether ?money buys happiness,? but what if just the right amount of money made us happier? Science is catching up with our common sentiments that money is associated with wellbeing. Is the logic true that having a higher net worth and lower debt means greater money happiness? Let?s take a look at the facts and find out.

What is financial well-being?

According to recent research by the Consumer Financial Protection Bureau (CFPB):

?Financial well-being can be defined as a state of being wherein a person can fully meet current and ongoing financial obligations, can feel secure in their financial future and is able to make choices that allow enjoyment of life.?

Their research indicates that to retain well-being, we need to have enough funds to maintain our lifestyles and dissolve our debts. You need the confidence to compare yourself to your own standards,(not those of others,) stay motivated, and believe in your ability to manage financial outcomes by controlling impulses and planning for the long term.

The Four Dimensions of Financial Well-Being.

Having consulted psychologists and personal finance experts, the CFPB further defines a state of financial well-being as one wherein you:


  • Have control over day-to-day, month-to-month finances; ?
  • Have the capacity to absorb a financial shock;
  • Are on track to meet your financial goals, and
  • Have the financial freedom to make the choices that allow you to enjoy life.
What?s the takeaway message here?

Ultimately, our personal relationship with money is what defines our financial future. As the minimalist philosophy swirls through the mainstream, we are reminded by prominent figures that having less can actually give us more.

Does having sufficient funds affect our mood? Absolutely. But more money doesn?t necessarily mean fewer problems. When our money mindset is less centered around buying new things, and more focused on eliminating stress, there is a newfound freedom.

We can allow financial-well-being to be a result of the joy and contentment we feel from living a full, vivacious life ? one where money plays a supporting role, but isn?t the necessarily the star of the show.

photo by Bethany Legg

Go Toxin Free without Breaking the Bank

Mr. Clean is due for an upgrade

Living clean is not easy. Scratch the surface and you’ll find plenty of dirty little secrets about what goes into our food, our environment and our bodies. Cleaning agents are no exception.?

Take a walk down the cleaning supply aisle and you’ll experience the familiar smell of chemicals emanating from plastic bottles. It’s enough to that make your head spin.

According to an Environmental Working Group study, 53% of cleaning products under review contained lung-harming ingredients and only 7% of the cleaning products even adequately disclosed their contents.

Why would our household items contain carcinogens, asthma instigators, and poisons? Does having a clean home need to come at the expense of our health? While there are many so called ‘natural’ brands that promote green cleaning products, let?s take a look at 3 sure fire ways we can clean up our act without breaking the bank.

1. Wash your windows with white vinegar

Window cleaners can contain shockingly toxic mixes of ammonia, ethanol, isopropyl alcohol, and methanol. Side effects from inhaling or ingesting these chemicals can include insomnia, dizziness, throat swelling, and even skin burns. While there are new types of window cleaners that are considered better, why not swap the toxic ingredients for something safe, natural, and less expensive like white vinegar? Vinegar is completely non-toxic, antibacterial, and is much more economical than standard window cleaners. Just mix one part hot water to one part distilled vinegar and add to your very own spray bottle. Clean as usual.

Cost: $1.99

2. Clean your oven and your mouth with baking soda

Standard oven cleaners emit toxic fumes and contain large amounts of sodium or potassium hydroxide. While these chemicals can dissolve crusty baked on grease, they can also burn skin, lungs, and eyes. To clean your oven naturally, sprinkle baking soda liberally to cover the bottom of the oven. Spray with water, wait 8 hours, then scrub and wipe clean.

Pro-tip: baking soda is also beneficial for your teeth. Many classic toothpaste brands contain toxic ingredients like propylene glycol, sodium lauryl sulfate, and triclosan?that?s nothing to smile about! Baking soda acts as a mild abrasive which dissolves in the mouth leaving no grit behind. It?s also alkaline which helps to neutralize excess acid in the mouth. Add essential oils like cinnamon or clove to the mix.

Cost: $0.77

3. Use fresh air instead of Febreze

The fact is, air fresheners do not clean or purify the air. They merely cover up odors by emitting undisclosed mixtures of chemicals. These fragrance components can actually trigger allergies, asthma attacks, and impair reproduction. It may sound old-fashioned, but simply opening windows or installing a fan can make a huge difference. Better yet, if a room has an odor problem find the source and eliminate that instead of masking it with artificial fragrances.

Pro-tip: grab that box of baking soda and pour some into a bowl. It’ll absorb odors in your bathroom or fridge. ?

Cost: free

It’s Easy Being Green

While there are many wonderful brands out there devoted to making green products with accurate labels and effective ingredients, the costs can really add up. Simple decisions like swapping baking soda for toxic toothpaste or throwing out the Windex for something safer and more natural like white vinegar may seem small, but these little acts of integrity pay off in the long run for the mind, body, and planet.

Check out a great resource we found for buying sustainable brands that are toxin-free.

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