Posts Tagged ‘Budgeting’

Online Bill Payments..What works?

March 28, 2009

I recently discovered that I did not make an online payment for 2 consecutive months.  While I have paid this bill online for a couple years, I did not make the time to go to the website and make the payment.  I used to get an email reminder to pay it but haven’t received one that I can remember.  This was a humbling lesson.  While I like to think I’ve got it all together, little slip ups like this remind me that managing money is a journey not a destination.  What about you?  How do you make sure all online payments get paid?

4 Signs Your Budget Is Broke

March 8, 2009

Budget means different things to different people. To many it’s a bad word. It means constraint and limits. Something we don’t like to think about. Whether you have one or not your money still goes somewhere. A budget is simply a drill sergeant for your money. It tells your money what to do and where to go. How are you managing your money? Are all the bills getting paid on time? Does your current system work? Below are some signs that your budget may be broke.

1) You’re paying overdraft fees.  If you’re paying overdraft fees, something is definitely wrong.  Having your account run over is a sign that you’re overspending somewhere.  An overdraft comes with additonal fees for your mistake.  This is a sign that some fine tuning is needed.

2) Using credit cards to purchase everyday items.  Going to your credit cards for things such as groceries and gas is a sign that things are out of balance.  Unless you pay the card off at the end of every month, you are paying for these items with interest added. Not smart.  If you’re regularly going to plastic because the account runs dry, it’s time for change.

3) Poor record keeping.  Put simply, not writing your transactions in your checkbook can be a hazard to your financial health. It’s not uncommon for me to find 10 or more unrecorded transactions in our checkbook every month.  This is very easy to do if both spouses use a debit card but only one carries the checkbook.  If you have suggestions, please leave a comment on this item.

4) It’s not in writing.  It’s imperative that you have your budget in writing.  You need to have groupings for expenses such as insurance, housing, food, medical care, and automobile just to name a few.  Not having a written budget is like going on a vacation with no road map.  

In summary, a budget is a must if you want to get the most from your money.  Money that doesn’t have a destination quite simply gets blown on non-essential items.  If you’ve seen some of these signs in your own finances, it’s time to make some adjustments.  Banks have enough money as it is.  Don’t let them get their hands on anymore of yours.  Be on the lookout for some solutions in my next post.

Budget Busters: 3 Solutions

January 20, 2009

What is it about these things?  You have your budget set.  How much you spend on each expense is tucked away nicely in each category.  For some unknown reason you end up with zero dollars in your account with 5 days until payday.  Where does the money go?  Where did it get off to?  Sometimes the best laid plans can go awry at times.  So what’s the solution?  What are your budget busters?  Better yet, what can you do to remove them from your financial life?  I do believe you can overcome these budget busters with some specific actions.

Solution 1: Track All Expenses.  I went through a program at my church called Crown Ministries.  One of the first assignments was to record every purchase I made for 30 days.  I kept all receipts and recorded them in  a log book.  What an eye opener!  What amazed me was what I spent on eating out.  Doing this exercises will help you know any unaccounted spending in your budget.  GO ahead and get a small notebook and pencil and start following ehere every dollar goes.  You’re bound to identify some budget busters here.

Solution 2.  Budget for Non-Monthly expenses.  There are some expenses that I don’t pay every month.  Here are a few examples: newspaper subscription, laundry detergent (we buy this in bulk), printer ink cartridges, and dog grooming.  These expenses occur every other month.  What this means is I have to be careful to set money aside to cover these expenses even though I don’t make a payment every month.  You could even withdraw that money from your account and put it in an envelope until you make payment the next month.  Example: $40 for ink cartridge.  Put $20 in an envelope from one paycheck and combine the next month and you’ve got it covered. 

Solution 3.  Balance your checkbook every month. As you reconcile your checkbook and statement you may identify expenses that weren’t in your budget.  If you’re like me you’ll find several entries missing from your checkbook.  I make a debit card purchase and forget to write it in when I get home.  Balancing your checkbook every month is a good practice.  It will usually give you a clue to some changes you need to make.