Kenneth Boyd's Blog, page 61

Does Your Budget Really Work?

Great, you have a budget for personal finances- but does it really work?

 

Everyone uses some kind of budget, even if it’s not formally put in writing. Many people aren’t aware of their budgeting process, but they put money away for future use, they prioritize their bills, and they use any money left over to treat themselves. All in all, it’s a way of life, and it’s something most people manage without even thinking about it.

But does your budget really work for you? Do you need to put so much money away in savings every time you get a paycheck? Are the ‘essentials’ you’re told to buy all that essential, or are there cheaper versions out there that would make money easier for you? Let’s think about all that below.

Get free sample chapters from my book: Not Another Personal Finance Book

Three Important Steps

 

If you don’t yet have a personal budget, there are three important steps to start the budgeting process:

 

Net income (net pay): Get a piece of notebook paper, and write down your monthly net income at the top of the page. This is the net amount that you’re paid as an employee, or the average net amount you earn as an independent contractor/ freelancer.

 

Fixed vs. variable expenses: Take a look at your banks statements and credit card activity for the last few months, and use that information to group your monthly spending into categories. Label each category is fixed (mortgage or lease payment, car payment), or variable (meals out, entertainment).

 

Savings account funding: Finally, makes cuts to your variable spending and use those dollars to fund a savings account each month.

 

Use these tips as your starting point to budget, and review your spending each week.

 

What About Savings?

 

On the one hand, there are a lot of people out there who aren’t putting enough into their savings, and that’s usually because they don’t have anything to put in their account. But on the other hand, there are a lot of people who like to overcompensate, and sock away more than they need to each time they’re paid.

 

Saving for a rainy day is important and makes sense, but the amount you save may put a strain on other parts of your personal finances.

If you’re sacrificing your ability to live comfortably now for something that might or might not happen in the future, you’re going to have to rethink your budget a bit. After all, good Financial Planning takes a bit of practice, and you’re going to have to start distributing your earnings out a little more fairly to make sure you’ve got groceries and bills covered, and then fund a savings account.

 

Long Term vs. Short Term

 

This issue doesn’t mean put everything back into your savings account! This simply means you may be allocating too much or not enough money to each facet of your life, even when following a well-planned financial budget.

 

If you’re only looking at your finances on a monthly or weekly basis, you may be missing the big financial picture. Take a long look at your budget once a year, and considering how you’re making progress toward a long-term goal, such as a downpayment for a house.

 

If you look at your finances as a yearly picture, on the other hand, you’re going to be able to budget much better on a monthly basis, instead of taking it as it comes. Of course, a lot of people don’t have this luxury, but if you’ve found yourself a stable income, this will be the best course of action to improve your financial situation.

 

You’ll be able to take into account your total earnings, the big expenses you’re going to have to fork out for, and you won’t be surprised by anything either.

 

Your budget is something that you’re going to need to change from time to time, and there’s no one size fits all rule that can be employed here. But make sure you’re always aware of what’s coming in and out!

This post is for educational purposes only.

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Bullseye, Jeff Turner CC by 2.0

 

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What Do You Want Your Bank To Look Like In 5 Years Time?

Setting goals is a great way to keep your personal finances on track.

 

If you want a larger bank account in 5 years, you’re going to have to put in some hard work and effort. Reaching your goal takes careful planning, and the discipline to stay on track. Consider these tips to improve your personal finances:

How To Set Goals

 

If we’re being honest with ourselves here, you need to set realistic goals. You can’t expect to pay every debt, and save thousands within a few months- it just isn’t going to happen. You need to balance the need to pay your monthly bills with your desire to save money. If you want to set a target, it’s going to have to be realistic, and that will help you avoid getting discouraged as you move forward.

Get free sample chapters from my book: Not Another Personal Finance Book.

Here’s an example- you earn $60,000 a year, and you want to save $200 a month to create a fund for emergencies. Follow these steps to reach that goal:

 

Review your spending: Use your bank statements and credit card statements to determine where you’ve spent your money in the last few months. Write down each category of spending, and the dollar amount. That’s your starting point.

 

Fixed vs. variable spending: Label each category is either fixed spending (car loans, lease or mortgage payment), or variable spending (meals, entertainment)

 

Plan variable spending: Create written plan for your variable spending, and make some cuts that free up dollars for savings. Maybe you make coffee at home three days a week, rather than buying coffee on the way to work. Or, do decide to eat out twice a month, rather than four times each month.

 

Use the dollars you’ve cut out of your budget to fund a savings account- and stay on track with your variable spending.

 

Set yourself monthly goals to reach, and add something on every time you cross something on. Goal setting is the best way to get where you want to be, no matter what we’re talking about in life.

 

Managing Debts

 

Increasing your bank account balance in 5 years will require you to manage and reduce your total debts.

 

One of the most common, and long standing debts, is a student loan, and if you visit websites such as http://refinancestudent.loan/, you might be able to get a refinance offer on it. This will make it easier to pay down your debt, and it’ll help take a big weight off your shoulders. You should also think of reducing credit card debt, because using too much credit has a negative impact on your credit score.

 

Your Bank Account

 

Of course, a bank account with a savings balance is a dream, but it isn’t always a reality. If you’re struggling to save because you keep dipping in and out of the savings pot you have, open up a separate bank account. Set up an automated transfer from your checking account into your savings account, and use self-discipline to avoid savings account withdrawals.

 

With hard work and a consistent effort, your bank account can look better in 5 years.

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Bullseye, Jeff Turner CC by 2.0

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What Do You Do When Your Business Isn’t Working?

Creating and growing a successful business is difficult.

 

Everyone who starts a business does so with the intention of being successful, but there are a lot of challenges involved. For every business that succeeds and makes a real impact on the world, there are dozens upon dozens that don’t make it. Whether it’s because of poor planning, poor communication, or just plain rotten luck, plenty of businesses simply never get to reach their full potential. The question is, what do you do when that happens? With that in mind, here are some ways to deal with it when things go wrong in your business.

What To Do

 

The best-case scenario is that you catch the problems early enough to do something about them. Being able to course correct and figure out how to deal with a particular problem as quickly as possible isn’t always easy, but it’s often the very best thing for your business.

Get free sample chapters from my book: Not Another Personal Finance Book.

The worst thing that you can do is to be stubborn and refuse to address problems and make the necessary changes to get back on track. Be willing to adjust your business and move it in new directions for the good of not only yourself but everyone involved as well.

 

Financial Issues

 

One of the most common reasons that businesses fail is simply that they don’t have the money that they need in order to function properly. If that’s the case, then there are a few options available to you:

 

Bootstrapping: You can use your own money to fund the business, and that may include savings, liquidating a retirement plan or some other investment account, or taking out a second mortgage on your home. Obviously, using your personal assets in a risky venture carries a high risk of loss, so think about this option carefully.

 

Crowdfunding: This has been a popular option in recent years, but the number of people participating in these programs as investors may have slowed down. This option requires a great deal of work to promote your business funding idea.

 

Private investors: You may be able to find business contacts or industry peers who know you, and believe in your idea enough that they’re willing to invest.

 

Consider the options listed above.

 

A traditional bank loan is probably not an option for you, because a bank will require collateral, and they will likely not lend to a business without a track record of growing sales and profits over 3-5 years, at a minimum.

 

Raising money in any form is difficult, because investors are justifiably nervous about helping to fund a struggling business. People don’t like feeling as though they’re throwing their money away, so keep that in mind as your attempt to raise funds.

 

Liquidation

 

Of course, if the worst comes to the worst then you may have to consider liquidating the assets of your business. The truth is that there may come a time when filing for bankruptcy is your only remaining option. It can be incredibly discouraging to feel as though your business was a failure, but the only real failure is if you don’t learn from the experience and try and move forward onto something new and better.

 

Now, this might not be something that you want to think about, but it’s crucial that you don’t let yourself ignore the potential for disaster when starting a business. Sure, there’s nothing wrong with focusing on the positive aspects of your business but hiding your head in the sand and ignoring it when things go wrong is irresponsible and is just going to make the whole situation worse.

 

You Can Recover

 

A large number of successful entrepreneurs have had business failures along the way; so don’t let a financial setback bother you for too long. Pick yourself up and move forward. You can do it.

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Bullseye, Jeff Turner CC by 2.0

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Playing The Long Game: Saving Money In Life But Still Getting The Essentials

Nowadays, the act of looking after your finances appears to be a very delicate art.

 

There’s a lot of advice out there that tells you that to save money, you’ve got to tighten your belt, and, in essence, constrict yourself of some of the essentials. But, let’s be blunt, we need the essentials in life. We need food, water, and we need to get from point A to point B.

And it seems that now, with the fact that more people are struggling, regardless of how seemingly poor or rich they are, every single one of us is feeling the pinch. We need the essentials in life, but how can we save money in life, and still get everything we need? Is it impossible, or is it about something else, something we haven’t thought of?

Your Strategy For Bills

 

The bane of our lives on a monthly basis, utility bills are rising and we don’t know how to deal with them, save the fact that we need to go without in order to pay them. Depending on who you are, you may have to dip into your savings to ensure that you have gas and electricity, but surely this is not the right way to live your life?

 

Instead, let’s burrow into what can be done to cut down on these bills. First things first, look at your suppliers, are you getting the most out of them for what you are paying? Look at other suppliers, and if they can offer a cheaper bill. Every energy supplier will look at how much energy you use, and so, this has been said before, cut down on unnecessary usage.

Get free sample chapters from my book: Not Another Personal Finance Book.

Now, this isn’t about depriving yourself, but rather, being more economical. When you brush your teeth, for example, do you leave the tap running? Do you flush the toilet? These things can increase your water usage without you thinking about it. You can find out how to be more economical with your energy but, the point is, you need to get into the habit of being economical. This is one of the biggest issues we all have, because we’re not used to forming new habits, but when a habit becomes ingrained, we don’t think about it.

Do You Research?

 

Looking at your day-to-day spending, are you getting the most bang for your buck? From your fuel consumption, to your groceries, convenience is one of the things in life that we take for granted. But with these convenient items, it means we are paying a little bit more for them.

 

Instead, can you find somewhere that sells a certain item, so you can pick it up on the way home from the office? Or is there somewhere that sells fuel for a bit cheaper? And when it comes to transport, if you are one of those people who needs a car, is your car as economical as possible?

 

A little research can go a long way, especially when it comes to finding the right car so you can go online to learn more about the best types of car for your fuel consumption, and your own personal circumstances.

 

Remember, if you buy a small car because you think it’ll be cheaper, but you still have to load it with heavy items on a daily basis, this is going to weigh the car down, and therefore, the engine will use up more fuel. There are fuel consumption calculators online to look at, and if driving is one of the main expenditures on a day-to-day basis, it is time to look at getting a more economical car, or even, getting rid of it altogether. Because we are so bound by convenience now, we think that what is near to us is the only option.

 

A very prominent example is that of purchasing items in shops, and as people are now getting the vast majority of their purchases online, this is something we can all take on board. Even grocery suppliers deliver, albeit for a charge. But think about it, how much would it cost you in fuel to go to the stores to pick up specific items, is it actually cheaper to order it online, and to pay that little extra charge?

 

A little research, no matter how annoying it can be, will end up saving you money here and there. And while there’s a lot of information out there to confuse this online, there are also handy little resources to help us save money. For example, there are money savings apps, like Plum, that works with an algorithm to help you save money, and actually messages you to give you a breakdown of how you spend your money. This can be very enlightening because you may not have thought about it before. And why these apps aren’t monitored by the financial powers that be, there are many people that use them to get a good idea of their expenditure.

Is It Time To Be Self-Sustaining?

 

And when it comes to the essentials in life, food is always the big thing to consider. Not only should you look at what type of food you buy, but if you plan your meals in advance or not, but also, if you store your food appropriately to get the most out of them.

 

A lot of us through our vegetables away as soon as a slight bit of mold appears, but, how you can find out how best to make the most of your food, and make it go a little bit further. Not only this but simple gardening habits can help you grow some root vegetables. It’s a simple thing called that but if we all become a little bit more self-sustaining, we don’t need to spend as much money.

 

Have a Plan

The essentials in life are things that we cannot go without, which is why it’s important for us to figure out how to save money, which appears to be an impossible task. Whether it’s about understanding your own habits financially, or if you are paying over the odds for bills, or if you can find a way to make yourself a little bit more self-sustaining, these are all little things that can add up to a considerable saving. Remember, it’s not about making a big saving, about saving little bits here and there which will add up to a big saving. It’s all about the long game.

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Bullseye, Jeff Turner CC by 2.0

 

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Reputation Vs Cash Flow: 4 Reasons They’re Connected

Money is directly linked with marketing and a digital presence.

 

These are the things which bring traffic to the eCommerce and physical stores and boost conversions. Or, if there isn’t an online or high street shop, then it should convince advertisers to pump money into the business. It has nothing to do with reputation – the industry is a numbers game.

United Airlines may beg to differ. After the company broke a guitar and the musician made a song about it, the stock fell by 10%. It cost them nearly $200,000 million. Whether it’s a scandal, disgruntled customers or employees, the effect on status can be monumental.

 

Here are four reasons why reputation can have a huge impact on cash flow:

 

Feet Vote

 

Consumers vote with their feet. They might not get the result they wanted – an apology and compensation – but they understand the game. By bouncing to a competitor, they will hit the firm where it hurts. And, they aren’t scared of taking their friends with them, or anyone else that will listen.

Get free sample chapters from my book: Not Another Personal Finance Book.

In the technological era, shoppers can vote on their mobile devices too. Review websites mean that word of mouth teams up with a poor online presence to portray a pretty bad image. If customers didn’t leave before, they will now.

 

Morality Debate

 

Back in the good old days, no one cared about where the products or services came. As long as they did the job and were cheap, the society was happy and willing to spend. Today is different. The smallest of offences can result in a mountain of trouble for entrepreneurs.

 

Check out the details at SkinnerLawFirm.net if you’re skeptical. Consumers won’t put up for anything dodgy or sneaky because they value their morals. There is a reason vegan stores and restaurants and green companies are skyrocketing in popularity. They make their customers feel good while providing a quality service.

 

Are You Satisfied?

 

On the whole, satisfied shoppers are likely to spend twice as much as any other customer. Yes, that applies to new ones too. After all, it can cost up to five times as much to attract traffic and keep them loyal.

 

By far the best option is to keep everyone satisfied and let them spend money. They won’t do this if there are scandals that rock their confidence. Yahoo.com has a list of the most reputable firms in the world and the top ones also happen to be the biggest organizations in their sectors. This isn’t a coincidence.

 

Tinned Sardines

 

Businesses are packed into the industry like sardines in a can. Anywhere a customer looks there are three, four or even five options from which to choose. There has to be a way for them come to a decision. Rightly or wrongly, they almost always use recommendations and reviews.

 

In short, people check the reputation of the company first before making a decision. If your status is below the average, then you’ll get kicked to the curb and be out of the conversation.

 

Money is affected by many things, but reputation is a major player.

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Bullseye, Jeff Turner CC by 2.0

 

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Common Financial Mistakes You Can’t Afford To Make

Whether you admit it or not, money makes the world go around, which is why it’s so important that you manage yours well.

 

To be successful in managing your personal finances, all you really need to do is spend less than what you earn. Unfortunately, doing this is much easier said than done. We all make mistakes when it comes to our finances, and while many of these mistakes can be put right, some of them can’t be. Because of this, it’s better that you avoid these financial pitfalls altogether. With that in mind, here are five you need to watch out for.

How Much Do You Spend?

 

If you want to spend less than what you earn, then that’s exactly what you need to do. Living beyond your means is an incredibly common problem, but is one that can wreak havoc on your finances. There’s no point in trying to act more wealth than what you are or keep up with the Joneses, as this will only put you in more trouble. Instead, you need to make some cutbacks and find ways to earn yourself some extra money on the side.

 

Relationship Issues

 

No one likes to think of love and money at the same time, but you have to understand that relationship issues can seriously damage your financial health. Of course, a divorce is a costly experience, but so is marrying someone who likes to overspend. Because of this, it’s crucial that you discuss finances before you get married, to ensure that you and your partner are on the same page with spending. You might also want to consider a prenuptial agreement.

Get free sample chapters from my book: Not Another Personal Finance Book.

What About Insurance?

 

Insurance is there to cover you financially and replace or repair assets if something were to go massively wrong. Because of this, it’s crucial that you have an adequate policy, or you could end up with much less cash than you need. Ensure that you research life, health, home, and auto insurance near you and find a policy that suits your needs. Just make sure that you don’t go overboard, as this can be just as financially damaging.

 

How Much Debt?

 

Most people have debt of one type or another, but it’s crucial that you don’t fall too deep into debt, as this can cause a lot of problems. If you’ve got into a financial mess, then you need to take action and do what you can to get yourself out of it. Start by assessing exactly what you owe, and then find ways to cut costs, earn extra cash, and start making payments. If you need help at any point, make sure that you get it. There’s no point in struggling alone.

 

What About Emergencies?

 

When faced with unavoidable and unexpected financial problems, your emergency fund should be your first line of defense. Unfortunately, if you don’t have one, you’re going to have to borrow, which means putting yourself in debt. Because of this, it’s important that you go over your budget and start to put some money aside. Try to get around six months worth of living expenses together and keep it somewhere safe, but easily accessible.

 

You Can Make Progress

 

Everyone makes mistakes now and then, but if you want to keep your money safe, then you should avoid making the ones listed above.

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Bullseye, Jeff Turner CC by 2.0

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Finding Victory Over The Bank

 

Dealing with financial organizations is never an easy job, but these companies have a big impact on your personal finances.

 

Stakeholders (stockholders, creditors) hold these companies accountable for making money- while also being experts in the field- and getting a bank loan at a reasonable interest rate can be a challenge.

 

It doesn’t have to be this way, though, as long as you’re willing to do some work to improve your situation.

To help you out with this, this post will be exploring some of the easiest ways to take more control of the borrowing process, and get better terms when you meet with a banker.

 

Which Bank?

 

This all starts with the job of choosing the right bank. Some will offer great interest rates and additional services, while others may have stronger skills when it comes to client relationships, and you will need to find a good middle ground before you can get started.

 

Get free sample chapters from my book: Not Another Personal Finance Book.

Having a bank manager who is willing to listen to you will feel like a great thing, while also making it much easier to negotiate a loan. Of course, though, it will take some research before you get to this stage.

 

Important Discussions

 

Of course, you know how to talk, or you’d probably struggle to get through much of this post. Talking to a salesperson, though, won’t be a very easy job, especially when you don’t have much experience. To help you with this, there are loads of confidence courses around the web, which teach you how to talk in a professional manner. Not only will this give you the confidence you need, but it could also help in other aspects of life, too.

 

Along with being able to talk the talk, you will also need to be willing to stand your ground. You have loads of banks to choose from, and you don’t have to stick with the one you’ve got. Instead, you have the chance to change this whenever you like, forcing them to work to please you, rather than the other way around. Simply bringing up a deal which a competing bank has running could be enough to convince them to give you what you want.

 

No Bank At All?

 

While this sort of option won’t work under all circumstances, ditching the bank is becoming increasingly popular when it comes to loans, current accounts, and other aspects of finances.

 

Companies like Subprime Loans can be perfect for this, as they work hard to provide options- which a bank simply can’t afford. You may end up paying a little more, but this will be a small price when you consider that lack of other options.

 

You Can Do It

 

Hopefully, with all of this in mind, you will be feeling ready to take on your bank manager in your next meeting. It will take a long time for you to learn all of the skills you need for this. Once you have them, though, you will have a great chance to apply them to other aspects of life, including your career and social life.

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: https://images.unsplash.com/

 

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Getting Your Foot On The Property Ladder, Fast

Owning a home is the biggest asset most consumers will ever own.

 

Younger generations are finding it difficult to get on the property ladder, with rising house prices, and the slow growth in salaries. Young people are feeling the strain, and saving for a down deposit on a home is challenging. If you’ve got aspirations to be a homeowner, there are things you can do to speed up the process and improve your personal finances.

 

Learn more about how to get your foot on the property ladder, fast.

What About Spending?

 

Are you wasting your earnings each month on unnecessary things? If you want to save more money, then it’s time to stop the waste. Work out how much you’re spending on things like clothes, eating out and drinking – you might be shocked by what you see.

 

Learning to be better with money can help you adjust your attitude. Explore ways you can cut your spending, and put that money aside to go towards your deposit. Some short-term cuts can have a big pay off, so remind yourself of the bigger picture when the temptation to spend kicks in.

Improving Each Month

Do you know how much money is going in and out of your account each month? If not, it might be time to face reality. Having a clear picture of your spending can help you make some decisions that will benefit your homeowner dreams.

Get free sample chapters from my book: Not Another Personal Finance Book.

For example, spending too much on a gym you don’t use- or spending too much on rent- could be money that could be put into your savings. Start a budget to work out how much you should be able to save each month and stick to it. These steps will help you save for a down deposit.

Credit Rating Issues

If your credit rating is poor, it can make it difficult to get a Hard Money loan that you’ll need to buy a house. Focus on building your credit back up by paying off what you owe, paying off balances in full at the end of the month, and avoiding getting into further debt. This, alongside your savings, will help you get the keys to your first home quicker.

More Income

If you’re finding it tough to save, then earning more money can be a solution. Having a side hustle can increase your income without having to work additional hours in your job, and could provide you with the cash boost you need. A side hustle can be a good way to spend your free time, if you cut back on nights out and meeting friends for dinner.

 

You Can Do It

 

Saving to buy your first house can be tough, but with some simple changes to your attitude and current spending habits, you can make it work. Find ways to drastically reduce your spending so that you can save more – the results will soon speak for themselves. Investing in your first home make be a big improvement in your personal finances.

 

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Pxhere

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4 Reasons You Need A Savings Cushion

No one can control when an emergency happens, so it’s important to have a savings balance to address an emergency, such as a car repair.

 

We know that a savings account can improve our personal finances, but it’s hard to take action. We daydream about what we can do with an account filled with savings, and we make as many deposits as we can for those ‘just in case’ moments. We save our money because we can’t predict what’s going to happen in the near and the far future. Having a savings cushion can help you out when life goes a little awry, as it often does.

Dealing With Risks

Without having savings, you leave yourself open to issues and risks in your life. What would happen if you lost your job and couldn’t make the mortgage? What would happen if your furnace broke down in the middle of winter and you didn’t have the savings account there to rescue you? What would you do?

 

These aren’t just hypothetical questions, and unless you have a savings account, you won’t be able to face an emergency.

Get free sample chapters from my book: Not Another Personal Finance Book.

How You Benefit

 

You may already have a savings account started, and there are a few reasons why a savings balance can improve your personal finances:

 

 

Retirement Planning: A lot of people have a pension, but alongside it they create their own investment portfolio. You can fund you retirement with monthly transfers from a savings account.

 

Emergency Funding: Furnaces, mortgages, car repairs – they all cost money! You need cash just in case, and it’s smart to set aside money each month to handle a potential emergency.

 

Legal Issues. If you have a legal issue, you may need the services of www.Bourdondefence.com/dui-lawyer-calgary/ to help you out. Without a savings account, you won’t be able to pay for professional representation in times of legal need.

 

Education: Whether for you or your children, you need to think about how you want to pay for education. If you want to start contributing to a college fund, a savings account is a good place to start. For example, you could move savings account funds into both a retirement plan investment and a college fund.

Only you can decide how much to save each month, and it’s important that you develop your budget to include a portion going to your savings account.

 

How To Save

 

Look down all your expenses and make smart decisions to reduce your spending, such as cutting out those coffees every morning from the local coffee shop. At $5 a time, you could be saving an additional $150 a month and bring your own coffee instead.

 

Implementing a savings plan is easier, if you avoid spending unnecessarily and put a monthly budget in writing. It’s important to know where your money is going, and including a savings account can save you from a lot of heartache later on down the line.

 

Find a Tool

 

There are some great mobile apps that you can use to set up a monthly budget, fund a savings account- and stay on track. If you’re not a tech-savvy person, try keeping notes on your spending in a notebook, or use an envelope system to plan for your spending in cash.

 

Give it a try- you can do it.

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Bullseye, Jeff Turner CC by 2.0

The post 4 Reasons You Need A Savings Cushion appeared first on Accounting Accidentally.

10 Crucial Checklist Items For Organized Finances

Organized finances aren’t something that everybody finds easy.

 

Some people find keeping their finances in order a breeze, while others really struggle and never really know what to do to ensure their finances are safe and in order. In this post, we’re going to talk about 10 crucial checklist items you need for organized finances. Create a checklist and then tick these off as you go. When you’re finished, you’ll have organized finances and likely be in a better financial position!

Bank And Credit Accounts

 

Start by cleaning up your bank and credit accounts. If you have more than one credit account, do all you can to close them and keep as few as possible open. If you have bank accounts you don’t really use, then close them. All they do is clog up your financial portfolio and they could even harm your credit score.

 

Apps That Help You

 

There are many apps and pieces of software these days that can help you to get your finances organized. Have a look, read reviews, and decide which apps can work for you. They will help you to track everything you spend and keep an eye on your finances in real time, so you never have to rely on bank statements or guess what you have in your account.

Get free sample chapters from my book: Not Another Personal Finance Book.

Take Control

 

Take control of your spending. Avoid spending money on things you don’t need, and become a little more frugal. Think about purchases for a while before you buy them – this means resisting the urge to spend on impulse and instead waiting a couple of weeks while you assess whether you truly need something or not.

 

It can be hard to resist the initial temptation, but you will usually find after a couple of weeks, the urge to buy has disappeared and you’ve saved yourself some cash.

 

Are You Automated?

 

Don’t rely on your memory to pay bills. Instead, set up automated payments. This ensures you always pay on time and that your credit score is not affected by a late payment. Late payments can be a nightmare, and this just means you don’t have to worry about them at all.

 

The Importance of Taxes

 

Making sure your taxes are in order is especially important, if you are freelancer or have your own business. You can look at tpg enrollment for tax products that can help with this. This is one of the most important things you’ll do if you want to make sure your livelihood is protected, so ensure you’re also keeping good records!

 

Are You Making Revisions?

 

Don’t just create a financial budget and then leave it as it is for months. You could be wasting more money than you need to! You should be revising your budget regularly – around once per month, so you can be sure that there’s nothing there messing your budget up and forcing you to spend more than you need to. Stay on top of your budget and you will automatically stay on top of your finances.

 

Look at your bills – when are they due to renew? Can you find a better deal online and call the supplier?
How much are you spending on the weekly food shop? How much are you spending on fuel? Can you cut back on those things?
What are you buying that is not necessary? Perhaps that daily fancy coffee, or even brand-name products that are the same as supermarket own makes.

 

Be vigilant and you could save a lot of money on your budget monthly.

 

Think Ahead

 

Don’t forget to think ahead to things you have coming up in the future. Does somebody important have a birthday coming up? Perhaps you have a spa day or trip next month and you could do with putting some money away for that?

 

Make sure you note things down in your calendar so you can look ahead and think about your finances then, and make changes now. You don’t want these things to creep up on you and end up in a panic because you haven’t left yourself enough time to put some money to the side.

 

Family Meetings

 

Holding financial meetings with your family is a good idea for a number of reasons. It allows you to ensure that everyone is on the same page, and that you’re teaching your kids important financial lessons, and that you stay motivated by talking about your goals. Do you want money for retirement, college educations, and trips together?

 

These meetings ensure you stay motivated and on track, most of all. They also give you a safe space to discuss anything that might be coming up, changes you may have to make (such as downgrading a TV package), and more.

 

Your Mindset

 

Getting into a better money mindset is one of the most effective things you can do. You can do this by changing your attitude towards money, which of course, takes time. Many people use negative phrases around money, calling it the root of all evil. However, money is just money, and the only meaning it has is what you attach to it.

 

Studies have shown that you attract what you focus on, so if you focus on having no money and it being evil – you can imagine what kind of scenario you’ll end up in. Read some of the classic books out there, such as Napoleon Hill’s ‘Think and Grow Rich’ and you’ll change your mindset in no time.

 

Need A Coach?

 

Still struggling to organize your finances? A coach can take an outside look at your situation and give you their honest opinion. Sometimes, all you need is something like this to get your act into gear!

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) http://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Bullseye, Jeff Turner CC by 2.0

 

The post 10 Crucial Checklist Items For Organized Finances appeared first on Accounting Accidentally.