Your Financial Health Check

We normally go for regular medical check ups to make sure that we are healthy.  A regular consultation with our physician could keep us from being seriously ill.  In the same way, we have to regularly check the state of our finances.  At all times, we need to know that we are not anywhere near falling into financial trouble.  The repercussions of financial trouble is something that people pay dearly for.  There is no easy way to get out of a financial eddy.  The best way is to keep yourself above water and away from any potentially damaging financial problem.  Do your health check regularly.  Among the vital signs that you should look for are:

1.    Savings – make sure that you have ample savings to cover for emergency expenses at all times.  Unexpected expenses are often the cause of people getting into quick loans with high interest rates that are difficult to pay off.  Having ready cash for these emergencies will prevent you from hanging on to these loan products for dear life.
2.    Protection – if you are raising your own family, you should not be without protection from unexpected contingencies.  These same unexpected expenses that come with being injured, disabled, or prematurely dying could take a toll on the family’s finances.  A good insurance portfolio consisting of a health insurance coverage, an accidental disability coverage, and your basic loss of life coverage would do well to give your family the financial security they need.
3.    Credit – check that you have a great credit standing at all times.  Do not let your payment due dates pass by without making your payments.  You do not want to have to settle for the not-so-good deals that are extended to people with bad credit.  Keeping your credit nice and clean will likewise keep your options open in as far as availing of other financial products is concerned.

Starting Small

If you are waiting until you have lots of money before you start investing, you are wasting your time.  A lot of opportunities are missed because of this kind of dilly-dallying.  And, in most cases, the money never gets to be enough simply because you keep on drawing from it to spend on “emergencies.”  There’s a great deal on vacuum cleaners at the home improvement store but you do not have cash yet.  You take from your stash intended for investing with the promise of putting it back the next payday.  Let’s face it, you will never get around to putting that cash back because there will be other needs and additional expenses that will come along.  Take your small amount of money and put them in an instrument that could yield more money.  Keep adding to it as your cash comes in and watch the yields increase even more.  Soon, you will have enough money to take advantage of the higher yields of more sophisticated investment instruments.

Depending on how small an amount you have, you can start by putting your money in a special savings account or a certificate of deposit initially.  These are savings instrument that will hold your funds until you have enough to participate in any investments.  One of the most affordable investment instruments are mutual funds.  These normally have lower initial investment requirements.  Your investment is pooled together with investments of other investors and used to purchase bonds and stocks in the mutual fund portfolio.  You get to take advantage of the higher earnings of these investment instruments without doing the trading yourself and without having to come up with the investment capital on your own.  These mutual funds are usually available in a range of variants catering to all types of risk personalities.  If you are risk averse, you can choose to invest in a mutual fund that is composed of 100% bonds.  Those who can tolerate risks can go for mutual funds that are highly invested in stocks.  Then, there is also the balanced fund which means that there is a mixed exposure to both stocks and bonds to even out the risks.  Any one of these funds could be a good start for those who do not have much investment capital available yet.

Saving for more money

Who does not want to have more money?  It’s just human nature, and perhaps, a result of all the commercially available goods that are being marketed as needs rather than merely items with no particular value added to our lives.  The want for more money should be more for aspirational reasons of bettering one’s life and uplifting the quality of life of one’s family than for making frivolous purchases.  Anyone can make more money nowadays with the availability of opportunities for home businesses and work-from-home projects.  If you do wish to grab any one of these opportunities, you can do an internet search and find one that matches your skills and needs.  Here are several options that you will most probably come across in your internet search:
1.    Pay-per-click advertising – this requires you to have your own website for which you can sell ad space.  These ad spaces could be banner ads or mere links.  For every visitor to your website that clicks the ad or link, you will be paid a certain amount of money.  Different advertisers have different requirements and different rates.  Make sure that choose only those that are relevant to your website (i.e. do not choose to advertise a baby product when your website is all about sports and body building).
2.    Online writing – this is great for those who love to write.  You write during your spare tiime and get paid for it.  There are those that give you specific topics to write about and there are those that let you write about anything that is relevant to particular products and services.  In the case of blogging, you can get paid by adding links to product websites in your article.
3.    Network marketing – simply put, the more people you recruit into the network, the more earnings for you.  There are a lot of these schemes online.  Be careful, though, to choose only those that are legitimate and provide real value.  A lot of scam of this kind has already caused people financial distress.
4.    Graphic design – calling web artists and graphic designers!  Instead of just tinkering around with your graphics software, you can put your talents to good use by offering your graphic design services on the net.  How much fun could that be to get paid for something you love doing in the first place.
5.    Selling products – you can turn the internet into your very own marketplace.  Selling goods online is now an acceptable way of doing business.  You can even have your own catalog that your target market can browse through.  Your store remains open 24/7, ready to take orders anytime, anywhere without the need for you to employ a full-time sales person or pay for utilities for round-the-clock operations.

Savings 101

It’s a consumer market out there.  From the time we are born, we are already exposed to the consumerism that is prevalent in most developed countries all over the world, America being one of most consumerized markets.  Everywhere we look, people are spending for various things.  Gone are the days when people simply traded for the basic necessities as food and clothing.  Businessmen continue to develop, innovate, and manufacture new things that some particular market segment would snap up and grab off the shelves no matter the costs.  How many times have you heard a teenager say “Ooooo, I’ve got to get that cool new gadget!” or your husband say “Hon, we’ve got to trade this old thing for that new plasma.”?  With all the spending that is going on, it is no wonder that about 65% of those who are at retirement age either do not have enough money to spend for their basic needs or are below the poverty level.  Now, you do not want to be part of this number, do you?

Here are some tips on how you can save money today so that you have something left for your old self to enjoy:
1.    Save before you spend.  Set aside a certain amount when your income comes in so that you do not get tempted to spend it.  Put it in an account that you are least likely to touch.  Your local bank will be able to help you find the right savings instrument for you.  Once you have enough money saved up in a regular savings account, you can already upgrade to a higher earning special savings account or certificate of savings.  These products do not make your money available to you for certain tenors but gives you additional earnings.
2.    Make a budget list.  Listing down everything you spend for makes clear to you all the expense items that you have for the month.  You see exactly where your money goes.  This way, it will be easy for you to see which expense items you can further cut back.  If you see, for instance, that you spend on five tall lattes at your corner coffeeshop everyday, you can save some money by cutting back on just having your tall lattes every other day or just downgrading to short.  Better yet, maybe you can just brew your own coffee and bring a hot flask to work.  This simple adjustment alone can free up some dollars on your budget.
3.    Do not underestimate the power of coupons.  Coupons can be great sources of savings.  There is nothing wrong with taking out all these coupons at the grocery line.  The amount of dollars you can save even with dime off coupons could amount to several dollars you can use to get other grocery items that you need, or maybe to treat yourself to a cone of icecream on a nice sunny summer afternoon.  Be on the lookout for end-of-season sales and clearances for particular items that you need around the house so you can save some more on your purchases.

Using Credit Wisely

The variety of credit products available to most consumers nowadays have created a spending frenzy. You can buy virtually anything today on credit. There really is nothing wrong with using these consumer credit products. People purchase their homes with home mortgage loans, get their cars with auto loans, go to school using student loans, and ring out groceries with credit cards. They are convenient no doubt. But, these consumer credit products should only be used when you are sure that you have an income source from where you can get funds for your repayments. Oh, yes, you do have to repay these charges. Here lies the problem.

It is so easy to get caught up in the spending frenzy given that financing instittutions make it so easy to avail of these products especially for people with clean credit. There are a lot of cases when people who start out with perfect credit scores end up with blasted credits because of uncontrolled spending.

Consumer loan products like personal loans and credit cards are the ones that usually get people in trouble because you can continue to use and reuse them until you have exhausted your credit limit. Pay the minimum amount at the end of your billing cycle and you have available charging power again. Have more than a couple of credit cards and you multiply your sources of shopping money. The culprit really to most cash woes is not the credit facilities. It is you. You determine when to spend and how to spend. The best tip that you can use is to only spend for those that you need and those that you are sure you can pay for. If you compute all those interest payments that you are making for your credit card purchases, you will probably be able to make one big special purchase for yourself. Use your credit wisely and you’ll be able to save lots of money in interest payments.