Easy Ways to Pay Off Your Mortgage Early

Photo from bridgememphis.com

If you're like most homeowners, you pay a mortgage payment every month.  Wouldn't it be great to pay it off early?  Dave Ramsey shares some easy and painless ideas which can save you interest and end your mortgage payment sooner than you ever thought was possible.  Check out this link:

http://www.daveramsey.com/blog/3-money-hacks-for-paying-off-your-home/?ectid=elp.facebook.post.9-24-2014

Source:  daveramsey.com

Ways to Save Money on Prescription Drugs

The cost of prescription drugs can be an enormous drain on the budget.  Enjoy this great article which gives some excellent suggestions on how to treat the high cost of prescription drugs.

http://www.walletpop.com/2011/02/15/savings-experiment-treating-the-high-cost-of-prescription-drugs/?icid=main%7Chtmlws-main-n%7Cdl9%7Csec1_lnk3%7C201866

You Can Avoid Becoming a Victim of Fraud

I received a brochure in the mail from the Federal Trade Commission and thought the information might be helpful to you.  In my lifetime, I have seen far too many people get taken by "get rich quick schemes" and scams because they don't recognize the warning signs.  Educate yourself so you can be prepared!
FRAUD WARNING SIGNS

• Sounds too good to be true
• Pressures you to act "right away."
• Guarantees success.
• Promises unusually high returns.
• Requires an upfront investment--even for a "free" prize.
• Buyers want to overpay you for an item and have you send them the difference.
• Doesn't have the look of a real business.
• Something just doesn't feel right.

PLAY IT SAFE

• Never click on a link inside an email to visit a Web site.  Type the address into your browser instead.
• It's easy for a business to look legitimate online.  If you have any doubts, verify the company with the Better Business Bureau.
• Only 2% of reported identity theft occurs through the mail.  Report online fraud to the Federal Trade Commission at ftc.gov/complaint.
• Retain your receipts, statements, and packing slips.  Review them for accuracy.
• Shred confidential documents instead of simply discarding them in the trash.

FRAUD FACTS

• Your bank will never e-mail or call you for your account number.
• Don't wire money to people you don't know.
• Be cautious of work-at-home job offers.
• Check out the company with the Better Business Bureau.
• There are no legitimate jobs that involve reshipping items or financial instruments from your home.
• Foreign lotteries are illegal in the U.S.  You can't win no matter what they say.
• Check your monthly bank statements for charges you don't recognize.
• Order a copy of your credit report from each of the three national credit bureaus once a year from annualcreditreport.com. 

GET INVOLVED

• It's never too early to become an informed consumer.  Point out "too good to be true" offers to your kids, and teach them to be skeptical.
• Take an active interest in the financial activities of your aging parents.
• Share information about scams with friends and family.  Use social networking to help keep them safe.

If you've received a suspected fraud through the U.S. Mail, or if the mail was used in the furtherance of a crime that began on the Internet, telephone or in person, report it to the U.S. Postal Inspection Service:

U.S. Postal Inspection Service
Criminal Investigations Service Center
ATTN:  Mail Fraud
222 S. Riverside Plaza
Chicago, IL 60606-6100
postalinspectors.uspis.gov
1-877-876-2455

The Federal Trade Commission, the nation's consumer protection agency, works to prevent fraud and to provide information to help consumers spot, stop and avoid it.  To file a complaint or get free information on consumer issues, visit ftc.gov or call 1-877-FTC-HELP.  Watch a new video, How to File a Complaint, at ftc.gov/video to learn more.

Creating a Budget

Are you wondering where your money goes every month?  Creating a budget may not sound like the most exciting thing in the world to do, but it is vital in keeping your financial house in order. Before you begin to create your budget it is important to realize that in order to be successful you have to provide as much detailed information as possible. Ultimately, the end result will be able to show where your money is coming from, how much is there and where it is all going.

• Gather every financial statement you can. This includes bank statements, investment accounts, recent utility bills and any information regarding a source of income or expense. The key for this process is to create a monthly average so the more information you can dig up the better.
• Record all of your sources of income. If you are self-employed or have any outside sources of income be sure to record these as well. If your income is in the form of a regular paycheck where taxes are automatically deducted then using the net income, or take home pay, amount is fine. Record this total income as a monthly amount.
• Create a list of monthly expenses. Write down a list of all the expected expenses you plan on incurring over the course of a month. This includes a mortgage payment, car payments, auto insurance, groceries, utilities, entertainment, dry cleaning, auto insurance, retirement or college savings and essentially everything you spend money on.
• Break expenses into two categories: fixed and variable. Fixed expenses are those that stay relatively the same each month and are required parts of your way of living. They included expenses such as your mortgage or rent, car payments, cable and/or internet service, trash pickup, credit card payments and so on. These expenses for the most part are essential yet not likely to change in the budget. Variable expenses are the type that will change from month to month and include items such as groceries, gasoline, entertainment, eating out and gifts to name a few. This category will be important when making adjustments.
• Total your monthly income and monthly expenses. If your end result shows more income than expenses you are off to a good start. This means you can prioritize this excess to areas of your budget such as retirement savings or paying more on credit cards to eliminate that debt faster. If you are showing a higher expense column than income it means some changes will have to be made.
• Make adjustments to expenses. If you have accurately identified and listed all of your expenses the ultimate goal would be to have your income and expense columns to be equal. This means all of your income is accounted for and budgeted for a specific expense. If you are in a situation where expenses are higher than income you should look at your variable expenses to find areas to cut. Since these expenses are typically essential it should be easy to shave a few dollars in a few areas to bring you closer to your income.
• Review your budget monthly. It is important to review your budget on a regular basis to make sure you are staying on track. After the first month take a minute to sit down and compare the actual expenses versus what you had created in the budget. This will show you where you did well and where you may need to improve.

Source:  Directly quoted from about.com, Jeremy Vohwinkle.  Article found here:  http://financialplan.about.com/od/budgetingyourmoney/ht/createbudget.htm

Here are some free budgeting tools I found for you online.  Now you have no excuse!  Decide which one fits your needs best and get to work managing your money!

http://www.kiplinger.com/tools/budget/ (electronic budget form)
http://financialplan.about.com/library/n_budget.htm (printable budget form)
http://www.betterbudgeting.com/budgetformsfree-basicbudgeting.htm (another printable budget form)
http://momsbudget.com/printables/householdbudgetprint.html (another printable budget form)
http://www.daveramsey.com/tools/budget-lite/ (quick 60 second online budget form)

Thrifty Christmas Ideas

It's that time of year to begin planning your Christmas.  Beginning early and planning ahead are the keys to being thrifty.  Here are some tried and true ideas to make your holiday a thrifty one!

1.  Make a list and narrow it down.  Determine the people you have to buy presents for.  Make a list.

2.  Create a gift budget.  Set a total limit, then divide it among people on your list.  When you shop, remember your budget for each individual and stick to it.

3.  Do an exchange.  This will really cut costs, especially if you have a large family or group of co-workers.  Instead of buying a bunch of gifts, you only have to buy one.  Our family does this and it's a huge de-stresser for us at Christmas.

4.  Make your own gifts.  Food items are always welcome, jar mixes, favorite quotes or photos framed (this is my new favorite gift), knitted/crocheted scarves and hats, photo slide shows, etc.  We had a friend who always made delicious treats and boxed them beautifully with tissue paper and decorated boxes.  They always seemed special because she put so much work into the presentation.

5.  Check out the thrift store and the dollar store.  Some people may cringe at this item but you might be surprised at the great gifts you can find there.  You may also find ways to package gifts with thrift store finds to make them unique and memorable. My friend found a beautiful bag at the thrift store and filled it with bath products.  Last year, I used Christmas ornaments from the dollar store and created star-themed gifts based on them.     

6.  Create home-made coupons for things like babysitting, yard work, car washes, massages.  I love receiving these (especially from my kids) and redeeming them when I most need the service.

7.  Make recipe books or recipe cards.  One of my all-time favorite gifts was a book my sister compiled of favorite family recipes.  It contains all my Mom's best recipes and adds my siblings most-loved recipes.  I use it all the time!  You can focus on a theme like chocolate recipes for a chocolate lover, for example.

8.  Give hobby-based presents.  Think about the hobbies of the person you are giving to:  sheet music for a musician, a plant for a gardener, golf balls for a golfer, scrapbook supplies for the scrapper, books for a reader, etc.  A well thought-out gift often has much more meaning than an expensive one.

9.  For kids, try making a dress-up box or trunk.  It doesn't need new clothes in it; instead, look for unique costume items at thrift stores or even in your own closets or attic.  One of our favorite family activities is letting the kids go to town in our dress-ups.  They come up with all kinds of unique costumes.  Some of their favorite items include a siblings' old cheerleader outfit, our Grandma's psychedelic 70s clothes, a black silky shirt with diamond buttons which becomes a pirate shirt, a slinky dress with belt, etc.  This gift encourages creativity and ensures hours of fun. 

Getting out of Debt: A How-to Guide

Is debt weighing you down?  There is hope!  It takes time, hard work, effort and persistence but you CAN get out of debt.  Here is a helpful step-by-step guide to help you pay down debt and move toward a debt-free future.  Make up your mind to put a plan into place and don't give up until you are debt-free. 

In order to get out of debt you must do the following:

1. Create a budget and track how you spend your money.  A good household budget starts with an honest assessment of your monthly expenses. Use this budget worksheet to jot down all of your regularly occurring expenses, including any money that you spend on eating out, hobbies or other forms of entertainment. Fill in all of the fields that pertain to you, and ignore the ones that don't. Have expenses that aren't included on the form? There's room to add those in under the "Other" category.

2.  Set budget goals and find ways to lower your monthly expenses.  For example, do you need your car?  Can you ride the bus?  Do you need cable/satellite/netflix when you can find free tv and movies on the internet?  Try brownbagging your lunches at work and cooking from scratch! Little changes can make a big difference in your budget.  For money saving ideas, see these links: 

http://thrivingandthrifty.blogspot.com/2010/10/ways-to-lower-your-monthly-expenses.html

http://thrivingandthrifty.blogspot.com/2010/10/practice-thrift-and-frugality.html

3.  If cutting expenses still does not allow you to put money toward eliminating debt, look for other ways to make money.  Can someone else in the family contribute financially?  Can you take on a part-time or second job?  A paper route? 

4.  Create a debt elimination plan.  The following commitments are vital to this plan:

• You must commit to stick to your budget.
• You must commit to not use credit to purchase anything until your debt is eliminated.
• You must commit to using at least 50% of increases in income to pay down your debt.

A Debt Elimination Calendar will help you eliminate debt.  Mark off several columns on a piece of paper.  In the first column, write the name of the month.  At the top of the next column, write the name of the creditor you want to pay off first.  It may be the debt with the highest interest rate, or the earliest pay-off date.  List the monthly payment for that creditor until the loan is repaid as shown below.  At the top of the next column, record the name of the second creditor you want to repay and list the minimum payment due each month.  After you have repaid your first creditor, add the amount of that monthly payment to your next payment to the second creditor.  In the example below, notice that the family finished making monthly payments on their credit card.  They then added $110 to the department store's $70 payment, creating a new payment of $180.  Continue this process until all debts are repaid.  

Sample Debt Elimination Calendar

Month	Credit Card	Depart. Store	Dentist	Auto Loan	Education Loan
January	110	70	50	235	75
February	110	70	50	235	75
March	110	70	50	235	75
April	110	70	50	235	75
May	PAID	180	50	235	75
June		180	50	235	75
July		180	50	235	75
August		PAID	230	235	75
September			230	235	75
October			PAID	465	75
November				465	75
December				PAID	540

Sources:  http://frugalliving.about.com/od/moneymanagement/a/Budget_Form.htm, http://www.managingmymoney.com/, http://providentliving.org/pfw/multimedia/files/pfw/pdf/72726_DebtEliminationCalendar_pdf.pdf

Understanding Credit Card Debt

Are you in credit card debt and only making the monthly minimum payment on your credit cards?  If so, you will be paying a lot more than your original balance and your payments will last for a long time.  


This chart shows how much you'll pay and how long it will take to become debt free if you pay a 2 percent monthly minimum payment on your credit card.  Note that even with interest as low as 12% on a $1,000.00 debt, you'll end up paying an additional $373.00 in interest and it will take you 5.7 years to pay it off.  With higher interest rates, the payments last longer and you'll pay more. 


Consider paying just a little more toward your debt with the highest interest each month and you'll save significant time and money.  This chart shows that with as little as an additional $10 payment per month, you will pay much less interest and will pay for a much shorter duration. 

		Minimum Payment Comparison Chart  $1,000 Credit Card Balance Interest Rate 12% 13% 14% 15% 16% 17% 18% 19% 20% Total if you pay monthly minimum (2%) $1,373 $1,425 $1,482 $1,546 $1,620 $1,704 $1,804 $1,924 $2,073 Years to pay off the loan 5.7 6 6.2 6.4 6.75 7 7.5 8 8.6 Total if you pay monthly minimum plus $10 each month $1,208 $1,231 $1,255 $1,280 $1,308 $1,336 $1,367 $1,400 $1,435 Years to pay off the loan 3.3 3.42 3.5 3.57 3.63 3.7 3.8 3.9 4 By paying $10 more each month, you save this amount $165 $194 $227 $266 $312 $368 $437 $524 $638 Source:  National Endowment for Financial Education