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Financial issues can strike at any time, but people that find themselves facing a financial issue often have months of warning that trouble is heading their way.  Instead of and pretending that the financial problems do not exist, the best course of action is to take control of your financial situation and manage any financial issue that arise before they snowball into a bigger mess.  Here are several tips for handling financial issues.

Don’t Deny The Problem

Many people find themselves in denial about their financial situation as the situation deteriorates due to lack of action.  To handle your financial issues, you must be honest about the severity of the problem and how you have gotten to that point.  By accessing the situation and taking responsibility for your actions, you will have a better understanding of what will be needed to reverse your problem and will able to create an effective plan that will not create more financial hardship for you or your family.

Have Patience

You must remember that your financial situation was not created quickly and the issues will not be solved quickly either.  It is important to think everything through, avoid panicking, and exhibit patience while allowing the financial management techniques adopted to repair your finances to work.  It is impossible to think correctly when severely stressed out and decisions made during these times may not be the right decisions for your particular financial situation.

Create A Plan

An important part of handling troublesome financial issues is creating a plan for resolving the financial issue without destroying your credit score or causing undue financial hardship.  In some cases, your standard of living will have to be reevaluated and significant cuts to your monthly spending may need to be made until the situation has been resolved.  If the financial issue is minor, you may be able to return to your previous lifestyle after a brief period of time.  Although facing a financial issue can be difficult, the hard times will not last forever and when the situation has been resolved, you will be able to return to your normal life with a greater appreciation for what you have been able to accomplish.

Now that the holidays are over, there are probably two numbers in your life you currently aren’t happy with. One is the balance of your available funds, and the other is the set of digits displayed to you when you step on your bathroom scale. The beginning of the new year means it’s time to get this figures back to where they belong. But what seem like daunting tasks are a much simpler mission to accomplish considering that by getting into shape and eating less, you’re likely to save quite a bit of money.

Consider for example the following six ways getting into shape will save you green this year:

Cheaper insurance: When it comes to health insurance and life insurance, most companies calculate BMI into their determination of your available policies and the premiums that are attached. The healthier you are, the more likely you are to see cheap insurance quotes. You could shave off $50 or even $100 from your monthly insurance payments thanks to diet and exercise.

Less spent on groceries: By adhering to a strict diet, you’re guaranteed to spend less on food even if the specialty health items themselves are a little pricier. You’ll skip the vending machine at school or work, as well as that muffin with your morning coffee. Over time, this amounts to serious savings.

Less spent on wardrobe replacement: Gaining weight means gaining more clothes in your wardrobe as you stop fitting into your old stuff. Not only that, but larger apparel these days tend to cost a few dollars more than regularly priced items to account for the extra fabric and work to make them. Cut out this strain on your budget by staying in shape.

Less spent on fuel costs: 30-50 lbs of extra weight hauled in your car everyday adds up to extra fuel being used to move your vehicle. Losing that means less spent on gas in the long run. But not only that, committing to walking and cycling more as you attempt a healthier lifestyle is also sure to lower the amount of money you spend on fuel by cutting down how much you’re driving your car.

Less on cooling costs: It’s obvious science – the more fat you have on your body, the hotter you’ll get as the temperature increases and the harder it will be to cool you off when the AC is turned on. Help yourself stay cool in the summer without relying on the air conditioner by cutting out the fat that keeps you hotter than you ought to be.

Free time is free: Instead of watching pay-per-view, fetching rentals, or buying the latest video games, go outside and play around in your backyard. Assuming you already have a pigskin and a radio, throwing the ball around while the big game is playing in the background is an active way to enjoy a few hours of your weekend that doesn’t cost a dime.

Take the first few months of the new year to get yourself in shape, both physically and financially. Taking on both at the same time is much easier than you think. Losing weight and eating right is a sure way to see more money in your wallet, which is a welcome sight in the wake of the onslaught of holiday spending.

If you are unprepared when an emergency occurs, you may find yourself having to resort to expensive debt to handle the problem.  This can quickly lead to financial devastation and great difficulty repairing your finances for years to come.  It is better to prepare yourself financially ahead of time so that you can handle any emergency that occurs without having to resort to borrowing money from anyone.  Here are some steps that you can take to prepare yourself.

Start A Savings Account

The best thing that you can do to be prepared for financial emergencies is to start a savings account and begin diverting money into it from your paycheck.  This will provide you with a financial cushion that can be used when unexpected expenses arise that are more than your regular paycheck can handle.  Having the savings available will ensure that you do not have to use a credit card to handle the issue, where interest charges and financing fees can cost you tons of money before the balance is paid off.

Keep Financial Records

Keeping accurate financial records will help you keep track of how much money you are spending and whether spending can be cut anywhere to provide more money for saving.  All financial transactions into and out of your bank accounts should be noted with the date, the amount, and a label for the transaction.  Tracking your transactions shows you where money is being wasted so that you can formulate a plan to turn those wasted dollars into saved money.

Create A Budget

Creating a budget will help you get a handle on your finances quicker than any other method of financial management.  The budget should include all of your expenses for the month and the amount that you are paying for each expense.  This will decrease the risk of you overspending in any category and may even identify areas of saving that you did not identify before.

Most of us have things that we spend way too much money on, often without even realizing it.  These money drains pack a huge wallop on our wallets and cost us thousands of dollars each year that would be better saved or spent on household necessities.  Here are some of the biggest money drains and how you can repair the leaks.

Eating Out

Eating out can be much more expensive than you realize.  The cost of an average meal in a causal restaurant is generally 5 times as much as you would have paid to purchase the ingredients at a grocery store and cook the meal yourself.  On top of that, you pay a premium for drinks and have to tip the wait staff for bringing you your food.  If you are trying to save money, limit the number of times that you eat out to the minimum possible and cook at home as much as you can.

Gasoline

The cost of gasoline has increased dramatically over the last decade and commands an increasing share of household budgets as the price continues to rise.  Saving gasoline is saving money, so planning your traveling to save as much gasoline as possible will save you a lot of money over the course of a year.  Consolidate trips so that all of your errands can be done in a single session and purchase items as close to home as possible to avoid unnecessary traveling.

Entertainment

It is very easy to overspend on entertainment items with so many options available.  It is important to keep the amount of money spent on entertainment in perspective and limit your spending so that you do not go over budget.  There are many ways to save money on entertainment including renting a movie to watch at home instead of going to the movie theater, canceling a premium cable package and choosing a basic package instead, or going to see local bands instead of buying tickets for national concert tours.  By shifting your entertainment habits, you can save money while having the same amount of fun.

Most of us can’t tackle all of our spending and saving needs at once.  We’re taught to maximize our retirement savings, create an emergency fund, pay off debts, and buy the right insurance while paying our bills, raising our kids, and trying to have a little bit of fun for ourselves.  Here’s what you need to know now to properly prioritize your spending and manage your money.

Pay Your Bills

If you can get a handle on your basic living expenses, your ability to manage all your other financial priorities will be greatly enhanced.  Try to limit your necessary expenses, which includes shelter, utilities, transportation, food, insurance, child care, and minimum loan payments, to less than 50% of your after-tax income.  If your necessary expenses are higher than this, you may want to consider trimming your costs by trimming your food bills, lowering your home’s thermostat, finding a cheaper place to live, or getting rid of an expensive car.

Create An Emergency Fund

Having an emergency fund allows you to pay for minor emergencies without adding to your credit card debt.  Set up automatic transfers from your checking account into a savings account and deposit any tax refunds or other windfall payments into the savings account until you have saved at least three months worth of expenses.  There’s a large psychological advantage to having an emergency fund as people that have them are much less worried that a small financial emergency would cause a financial hardship.

Pay Off Credit Card Debt

Credit card debt is one of the most dangerous types of debt because lenders can change rates and terms at any time, the interest rate is usually in the double digits, and high credit limits encourage you to rack up more debt than you can comfortably repay.  To eliminate this debt, target the debt with the highest interest rate first, paying as much as possible while paying the minimums on any other debts you may have.  Another method would be to tackle your smallest debt first to give yourself the psychological boost of completely paying off a credit card bill.

Let’s face it; almost everyone could use some extra money these days.  Luckily, there are literally thousands of ways to make extra money in your spare time.  Finding the best way to make extra money will depend on a number of different factors, including your interests, your schedule, and the amount of time that you will have available to dedicate to making money.  Here are some of the most common methods used to earn additional money during your spare time.

Capitalize On Your Talents

If you have a talent, put it to work for you earning you money.  People that know how to play the guitar can earn a substantial amount of cash playing gigs or teaching others how to pay.  People that are good at creating craft products may find a market for the things that they make in their neighborhood.  There are many different ways that a talent can be used to make money, so be creative and explore all of your options.

Find A Part Time Job Online

Many online companies are looking for people that can perform specific tasks for the company over the internet for a nominal fee.  There are some companies that need people to write product descriptions for their products, other companies that need someone to proofread their documents, and a multitude of others that would rather pay someone as a contractor than hire someone with the company to do the job.  You can choose the projects you accept and the number of hours you are willing to work to ensure that the part time job will not interfere with your primary employment.

Become A Tutor

If you are strong in a particular subject or enjoy teaching children, you may want to consider earning some extra money as a tutor.  Nearly every neighborhood has a group of children that needs help grasping specific concepts and parents willing to pay by the hour for you to help their children learn the things they are having difficulty with.  Be aware that you may need to prove your proficiency in the subject that you choose to be a tutor for and that parents may withdraw their children from tutoring at any time depending on their situation and their perception of whether you are tutoring the children properly.

There are many common mistakes that people make when managing their money and nearly everyone is affected by one or more of these mistakes on a regular basis.  It is important to keep these mistakes to a minimum if you are interested in building wealth and securing your financial future.  Here are some of the most common mistakes that people make with their money and the best ways to avoid them.

Buying Impulse Items On Credit

If you use your credit card to make an impulse purchase and do not pay off the balance of that credit card before the grace period is up, you will be paying interest on that purchase for months, or possibly years, after the purchase has been made.  Spending your hard-earned money on items that you do not need is bad enough, but paying hundreds of dollars in interest for the purchase over time is much worse.  It is important to only charge the amount that you can afford to pay off each month to limit interest charges and to limit purchases to the items that you truly need.

Taking On Too Much Debt

Taking on too much debt can quickly land you in financial trouble.  Every year, millions of individuals find themselves struggling to pay their expenses, their loans, and their credit card bills because they have taken on too much debt.  The warning signs that you may have taken on too much debt are deliberately paying bills late, borrowing money to pay existing loans, and putting off medical appointments and other necessary expenses because you are short of money.  If any of these warning signs are present, you need to make paying down your debt as quickly as possible a priority so that you can get out of debt safely with your credit score intact.

Paying Your Bills Late

Paying your bills late can cause your creditors to report the late payments to the credit reporting bureaus for inclusion on your credit report, which will decrease your credit score.  Your credit score can affect many different areas of your life, including whether you are approved for a home loan or an apartment, whether you qualify for a particular employment position, the interest rate you are charged for loans, and the amount that you pay for insurance.  It is important to keep your credit record as clear of negative information as possible and the best way to do this is to pay all of your bills on time.

According to the Federal Trade Commission, “Identity theft occurs when someone uses your personally identifying information, like your name, Social Security number or credit card number, without your permission, to commit fraud or other crimes.”  The agency estimates that nine million Americans are victims of some sort of identity theft each year and recovering from identity theft can be frustrating and time-consuming.  Taking some preventative steps now to protect your identity can help prevent major problems later.

Review Your Account Statements

It can take years to repair your credit history after a case of identity theft if action is not taken quickly.  In order to spot errors early, you should review your monthly statements from your checking and other financial accounts carefully and note any questionable items that appear.  You may want to consider signing up for online accounts, as it is faster and easier to review financial accounts online.

Check Your Credit Report

Each of the three major credit agencies, Equifax, TransUnion, and Experian, are required by law to provide every individual with a credit history with one free credit report per year.  Be careful of the website that you use to obtain your credit report, as some websites may try to charge you a fee for the credit report or get you to sign up for a monthly service.  AnnualCreditReport.com is the only place to get these credit reports for free.

Secure Your Personal Information

Make sure that your personal information is secure online and offline.  Keep your Social Security card and other important identifying documents at home in a secure location instead of carrying them around with you.  Shred old bank statements, credit card applications, and other documents that have your personal information included on them.  Online passwords to financial accounts should be changed often and personal information should never be shared online unless you are certain that the website you are dealing with is a legitimate one.

Taking these actions will significantly reduce your risk of becoming a victim of identity theft and ensure that any attempts at identity theft are identified quickly.  Anyone can become a victim of identity theft, regardless of income level, so it is best for everyone to be vigilant and keep all personal information secure.

Many people have bad financial habits that are costing them a large amount of money over the course of a year.  Many of these habits are unconscious, everyday routines that people have learned by observing others that display these damaging behaviors.  Bad financial habits have the ability to destroy your credit score, cost thousands of dollars in late fees and penalty payments, and cut you off from economic activities that could improve your financial standing.  If you are able to change these bad financial habits, you will find your financial situation much more stable and your ability to handle financial emergencies assured.

Spending Freely

One of the worst financial habits to cultivate is being a free spender.  Spending without planning or considering the consequences of your spending can lead to a lot of wasted money on things that are desired, but not necessarily needed.  Many of us have seen the “hoarders” reality shows on television where desperate homeowners are drowning in piles of stuff that they bought that they didn’t need.  By planning your purchasing ahead of time and limiting impulse purchases, you can reduce the amount of money spent on unnecessary purchases and use that money for more useful activities.

Opening Many Credit Card Accounts

A number of retailers have taking to stalking their customers in the store and online to encourage them to sign up for the retailer’s “exclusive” credit accounts for their stores.  The reason why you are asked when you enter the store, as you shop, and as you attempt to check out is that these credit accounts can be very lucrative for the retailer, but not so good for you.  Retailer credit card accounts often have higher interest rates, higher fees, and lower credit limits than credit cards issued by the major credit card companies that can be used anywhere.  Add to this the hassle of keeping track of multiple payment dates, minimum payment amounts, and credit card terms, and the chances of accidentally missing a payment and incurring hefty charges increases dramatically.

Using Credit As An Emergency Fund

The recent boom in the credit markets steered many people away from saving cash to use for emergencies to depending on their credit cards to handle any financial issues that arose.  As a result, many people found themselves with high levels of credit card debt at high interest rates that they have great difficulty repaying within a reasonable period.  Placing the cost of a financial emergency on a credit card increases the cost of that emergency dramatically as interest charges and financing fees are added to the original cost on a monthly basis.  Saving money in an emergency fund to handle unexpected financial issues is the best way to solve the problem without creating more issues for the future.

There are many ways to save money and some are easier than others are.  Some of the best ways to save money is by changing your lifestyle in small ways.  Many of our daily habits cost us a great deal of money without us realizing it and these charges add up over time.  Making these small lifestyle changes can result in big bucks in your bank account.

Give Up The Bottled Water

Bottled water is one lifestyle choice that many of us can do without.  The cost of bottled water is very expensive when compared to tap water, costing the average consumer nearly $1,400 annually.  Most bottled water is just purified municipal water, so you can get the same results by placing tap water in a reusable filtered water bottle and save yourself a ton of money.

Cancel Unused Memberships

Many people are paying for memberships that they never use.  Whether the membership is for a wine club or a fitness club, if you are not using the membership you are just wasting money.  The average gym membership will cost you around $600 per year and some memberships cost even more, so if the membership is not being used, cancel it and keep the money in your pocket.

Boot Your Bad Habits

Many of the most common bad habits are very expensive.  People who smoke a pack of cigarettes a day are spending between $1,800 to $2,700 per year, depending on where they live.  Individuals that drink high calorie lattes on a regular basis are spending around $900 annually for their habit.  Gambling is the most expensive bad habit, costing regular gamblers thousands of dollars as they try to beat the house.  Instead of indulging in these habits that are costly and unhealthy, place that money into your savings account and watch your savings grow.