Useful Financial Tips

Table of Contents

• Overview
• Simple Home Finances Toolkits Provide
• Some financial concepts that work
• Pay God first
• Pay yourself right after you pay God
• Put all of your costs into the expense picture
• Keep up to date on loan rates and costs
• Know what your Assets are worth
• Develop a savings habit
• Develop an Emergency Savings account
• Live on less than you make
• Plan for the unexpected
• Choose to level / average bill your Utilities
• Constantly hunt for lower prices
• Be a miser

The Simple Home Finances toolkits are Microsoft excel based solutions for managing money. These toolkits simplify managing your personal finances. In a world of great complexity, with many financial management companies competing for your attention, you stand at a distinct disadvantage. Banks, Investment companies, Insurance companies and others possess detail information about your personal finances. These toolkits are designed to arm you with information about your finances and give you greater control.

Some things never really change and the same is true about managing money. A plan is needed, goals are needed and information is needed. Even in a day like today with awe inspiring technology and vast amounts of information at our fingertips, all we really need to know is a relatively small amount of financial information. Generally enough to answer these questions:

These are the bread and butter issues of household financial management. Armed with answers to these topics, financial goals can be made and reached. If you can't answer these questions, it is unlikely you will achieve your financial goals. Simple Home Finances toolkits give you insight into how much you can afford to spend and what you can do to save more money. These toolkits give you insight into what your loans are costing you and give you ways to plan for paying off you debt through pre paying principal, refinancing or consolidating your loans. These toolkits help you project the equity you have or will have in your home. Finally these toolkits help you develop a plan to retire not solely based on saving more, but also based on a number of steps you can take that can make retiring a reality and not just a hope.

The use of Quicken or Microsoft Money has given people a great deal of information about their expenditures and a sense of control over their money. The Simple Home Finances toolkits supplement the use of these. Quicken and Microsoft Money are powerful accounting tools that account for past financial transactions. Simple Home Finances toolkits are powerful planning tools that help you plan and reach financial goals. Accounting tools are built to help you account for the past and planning tools are built to help you plan for the future.

Budget toolkit that provides you with the planning capability you need to balance your income and your budget while you seek to achieve financial goals. It is this planning capability that is the key to successful personal financial management.

Loan toolkit that provides you the ability to plan for and manage the payoff of many types of loans and gives you insight into the present and future equity you may have in your home.

Retirement toolkit that provides capability to plan and manage your retirement finances before and during retirement.

We have found that keeping these tools simple to use is critically importance. We also found the key to Mastering Money is to make a commitment to consistently plan and manage the money you have. These toolkits let you adjust your plan as things change over time. After you use these toolkits for a while you will know more about your own finances than the banks or brokers because you will be driving the plan.

The key to controlling spending is to limit what is available to spend

For things like groceries, car gas, kids allowances and pocket change, typical weekly expenditures, you can control how much is spent by using weekly cash. When the cash is gone you just stop spending and wait for the next week. That takes discipline but it also provides control. It is very easy to spend more than you budget when you write a check or use a debit card or credit card. Using cash physically limits what can be spent. You may find that by doing this you will become more frugal.

At the risk of offending someone, I must say that one aspect of financial management that is critical to understand is that all that we have comes from the hand of God. I have learned that paying God first is the wisest and most fruitful financial concept we can put to work.

Direct Deposit is a great way to save. Direct deposit money into your 401k and other savings accounts. In most cases you will find that if you limit the ways in which you can get money out of an investment you will tend to leave it alone. So the rule here is do not trust yourself too much and limit your access to the funds where possible.

Try not to leave anything out. This is the key to getting to the truth. If you know how much you make and do not account for what you spend it may appear that you are doing better than you actually are. Getting all the expenses into the budget will get you a higher level of certainty that what you have left at the end of the month can be added to some type of savings.

You can save a great deal of money by refinancing loans when rates drop a point or two. A good alternative to high rates is to pre-pay on your existing loan. Even a small prepayment per month can add up to a large amount of interest savings over time.

Be proactive in determining the equity you have in your house. Your home is likely your biggest asset and at some point it may provide money that you need. Keep close track of the equity in your home.

Learn to save for the future. Realize that we save today so that we can spend tomorrow. Paying cash, especially for big-ticket items, is usually the smartest way to buy them. But, paying cash for things requires saving the money first and taking advantage of the interest those savings will earn over time. Consider developing a savings plan: save to purchase your next car, save for your kids college education, save for your next vacation or save to reach you retirement goals.

Set aside money that you can use if you lose your job or to pay for an unusually big expense. Build this emergency savings account up to equal 3 to 4 months worth of living costs.

We all have choices in where we live and how we live. We can choose to live in a smaller house, drive an older car, eat out less and make many decisions that in the end will cost less money. There is a great deal of financial pressure in the life we live. One simple way to reduce those stresses is to choose to live on less.

Life is non linear, meaning life is unpredictable. There is a great deal of variability in life, lots of unknowns, so when you plan make sure you allow for the unexpected by planning a set amount of dollars for miscellaneous expenses. These are things that come up that you just cannot see, a doctor visit, taking a pet to the vet, buying a battery for your car or paying for stuff that just comes up.

Other things that you need to think about include the variability of cell phone, long distance and utility charges. Plan a little bit of hedge money in your expenses each month to account for month-to-month fluctuations.

Another example of variability is that utilities are seasonal. If you cool your house using electricity and you heat your house using gas then your electric bill will be high when your gas bill is low and vice versa. Account for seasonal fluctuations in your utility expenses.

Wherever possible try to reduce the variability of household bills. Many utilities offer level or average billing offerings, this smoothes out the per month costs. This is a good thing to take advantage of because it makes living within a budget much easier.

If you want to put more money into savings you need to reduce your expenses. You can to this by being an astute consumer. Shop for lower costs in every area of your plan; insurance, mortgage, local and long distance phone, utilities, etc. Savings like this may be the way you get the money together to go on vacation next year. Maybe you want to save a little more in your 401k. Maybe you want to go out to dinner more. Perhaps you need to save more toward college costs for your children. What ever the reason competition works for you and you need to take advantage of it.

Learn to hate waste. Some practical ways you can benefit by reducing waste are:

1. Make your home more efficient. Many utilities offer guidelines for reducing the energy you waste.
2. Use less water but do not sacrifice that great shower. This can be done by following the guidelines that most water utilities offer. This includes not over watering the grass and using showerheads that are designed for comfort and water reduction.
3. Insulate your water heaters with reflective insulation. This is a simple low cost step that will bring about a noticeable change on your utility bill.
4. Install a tank-less Water heater it can save you a lot of money
5. Clip coupons and use them.