What They Don’t Understand….

The thing with living paycheck to paycheck or with living in poverty is that you don’t have money. Everyone who is reading this is probably scratching their heads because it seems really obvious. And it is very obvious. No money=no money to spend. But there seems to be a subset of the population that doesn’t really understand what that really means.

What do I mean?

Take myself for example, by the current financial calculators I am classified as “low-income”. Not middle class- the one below that;). I, (thank G-d!) do not live below the poverty line but I am, by definition, poor. I do not like being poor so I am working on changing that. I work hard and I am slowly working my way up in my company. As a “side hustle” I decided to start a blog. Now, this is not a woe-is-me post but merely an example. I have not made any money from this blog (yet!) but I hopefully will. But that takes time, and not only time but money. There are hosting fees, for example. Now, I orginally started this blog using one hosting site. But when renewal came around, their prices were too expensive for me. So I decided to switch hosts to save on costs. This procedure requires more technical skill than my own rudimentary skills, and I couldn’t afford to hire someone to do it for me, so I had to rebuild my site. Instead of taking the time (this is all in addition to my full-time job and mothering duties) to build up my site,. Increase my reach, monetize my site etc. I had to spend time recreating the work I had already done. This all took double the amount of time because my computer is very slow and glitchy. This is because I have a very bad laptop. It constantly freezes and opening an internet tab takes approximately ten minutes. You can imagine how long it takes to find photos for my posts! I can’t afford another computer right now, even as an investment.

Which brings me to my point: poor people can’t really invest. Investment is inherently risky. I can spend money on a new laptop in the hope that it will bring me more money but I really can’t be sure of that. I don’t know if I will make the money back-especially not in the time frame that I would need it. So I struggle with my old, creaky laptop and hopefully will slowly make the money to be able to buy a new one. Even though buying a new after laptop will help me make more money, of that doesn’t happen-the risk is to large for me to swallow. What’s a few hundred dollars, you ask? A lot. It’s a lot. It will literally take me MONTHS to set aside that amount of money.

Buying in Bulk- This is common advice that I see given to help people save money on food. The cost savings can be huge. BUT…. that is assuming that you have the money to lay out for it. Many don’t. Many people can’t lay out a large amount of cash-or blow their entire food budget on one ingredient that will save them money in the future. It’s too risky. They may not have the money to pay it back. The cost-savings may not turn out as great as initially perceived. Things go bad, things drop on the floor. Even if the investment is worth it, the emotional energy it takes to remember to “pay-back” the $5 you saved on rice can be too much for many people.

Why am I writing all this? This is not a pity post or a sympathy post. This is an explaining post. This is explaining why we (the poor people of the world) are not taking your very good financial advice. Your financial advice is great but we can’t afford to take it. We can;t buy equipment for our side hustle. We can’t buy 3 months of rice in one go even though its cheaper. We can’t buy membership at Costco. We don;t have the money to buy this season for the next. We can’t buy solar panels or invest in large-minimum balance accounts. We want to. Maybe one day we will. It just is going to take us a longer time to get there.

Meanwhile, we are doing the best we can to stay out of debt, build some savings. And maybe, just maybe, buy a new computer one day.

8 Debt Myths That Can Change Your Financial Life

This is a guest post by Good Nelly loves to analyze the day-to-day financial happenings along with critically analyzing the changing rules of credit, debt, insurance, mortgage, etc. related matters. She loves to share her analysis with others thus helping people to understand the exact scenario. The opinions in this article are attributed to her and her alone.

 

Being in debt is bad. But do you know what is worse? Having misconceptions about debt, yeah.

Approximately 99.9% of us have debts in some way or another. It is a necessity in today’s economy where people pay almost everything with credit cards. They also depend on student loans to get an education, mortgages for getting a new home, and so on.

If you have an affordable amount of debt, it can help you to attain your goals and live a comfortable life. But if your debt becomes uncontrollable, it may create huge problems in your financial life.

Having plenty of debt myths and misconceptions may lead you towards making wrong decisions. Those decisions may ruin your financial life and push you towards more debts. Keeping that in your mind, check out some common misconceptions about debts that you might need some explanation.

Debt myth #1- Late payments on credit cards will harm your credit score

If you make late payments on your credit cards, the credit card company may charge you late fees. They may also create interest charges. But credit card companies normally won’t report late payments to the credit bureaus until your bills are 30 days past due. If you have to make late payments, no harm will be done to you as long as you can afford the interest charges and late fees. But don’t make it a habit, unless you want to lose a good amount per month.

Debt myth #2– Making minimum payments on credit cards are good

If you only make the minimum payments on your credit card balances every month, you can’t imagine how much time it may take to pay off those credit balances. Month after month, you’ll have to pay the original balance, as well as you’ll pay interest charges. If you sum up the total amount, it may become way higher than the original balance.

You shouldn’t continue making only the minimum payments if you want to get rid of your credit card debts. Making minimum payments will generate interest charges and increase your total debts. So, make full payments every month as far as possible. If you face any issues, call your credit card company and negotiate for an alternative payment plan.

Debt myth #3 – Closing few credit cards or reducing credit limits will make the credit score sky high!

Absolutely wrong! Closing an old credit card means you are also wiping out an entire credit history with a decent credit limit. A bad credit history and a low credit limit can greatly affect your credit score. How? Let me explain.

While approving a new credit card, a credit card company will surely consider your FICO credit score. Older credit accounts may help you to build your score, because it has a long credit history to support your credit. When you close an older account, you lose the benefit of the credit history of that account.

If you close an old credit account, you are also reducing a decent amount of credit limit from your total available credit limit (all credit cards combined). Lowering credit limit will increase your credit utilization, and it’ll harm your credit score.

Debt myth #4 – Credit report can be repaired instantly by paying off debts

Another great misconception and the answer is will be a big ‘No’! Your credit report is an overview of your current financial situation and your credit history. So naturally, it’ll include all of your debts too. Paying off debts will improve your credit report and credit score, but it won’t remove the past black spots from there. Typically, most of the negative entries or information remain on your credit report for as long 7 years. Chapter 7 bankruptcy stays for 10 years and a Chapter 13 stays for 7 years. If you want them to be removed, you need to wait for that long.

Debt myth #5 – Getting married means more debt from your spouse

Most of the married couples believe that after marriage, they should always need to merge their debts. Practically, it’s not true. It’s quite common for a husband and a wife to work together and eliminate their debts together. But it is not a legal obligation for both of them.

Every individual has a separate entity when he/she are single. So why it should be different after the marriage? Couples should manage their own finances separately, as well as their debts. Of course, like an ideal couple, they can seek each other’s help at any point in time.

Of course, there are chances when a person can be obliged to pay his/her spouse’s debt after marriage. You could be responsible for a loan you have consigned with your spouse, or you have to pay the credit card bills where you have authorized your spouse as a joint account holder. It’s up to you, whether or not you want to sign up for the thing.

Debt myth #6 – All debts are evil and will damage your finances

Indeed, it is one of the most common misconceptions about debt. You might not treat it as a truth, but “good debts” exist. These debts will create some value in your financial or normal life, or in both. What are the examples? Check these out.

When you borrow money to start a business or to increase your net worth, it may be called as a good debt. Taking out a student loan can increase your knowledge and help you to get success in life. Thus, student loans are also considered as good debts. When you take out a mortgage, you are actually investing in an asset. After paying off the mortgage after 15 or 30 years, you’ll get a home with a higher value. So, it is also a “good debt’’.

But don’t forget that you must repay your good debts and keep your accounts in good shape if you want to prosper in your financial life.

Debt myth #7 – Bankruptcy is the coolest option if you want to get out of huge debts

Not at all. Bankruptcy should be your last option if you run out off other alternatives. To handle your huge debts, you might opt for popular debt repayment methods like debt consolidation program, debt settlement, taking out personal loan or loan from relatives, taking out a home equity loan or HELOC, withdrawing money from 401(k), etc.

A debt consolidation program combines your multiple debts into one single monthly payment and lowers your interest rate. On the other hand, if you opt for settlement by negotiating with the creditors, you can practically settle your total debts into a lesser debt amount. A successful debt settlement might ease up your debt load, but it may also harm your credit score, whereas debt consolidation doesn’t have much effect.

If you choose other debt repayment options, don’t forget to make payments on time and in full.

Debt myth #8– Credit counseling agencies are god damn blood-suckers!

Rubbish! A credit counseling agency is usually a non-profit organization who can provide you with debt help when you need it desperately. You might be able to handle your 2-3 credit cards quite easily. But what about a situation when you have multiple debts? In that situation, you might handle your credit card debts well, but what about other unsecured loans, bills? Who will help you? Who to talk to about debt!

Here a credit counseling agency will come to rescue you from the jaws of debt. Under a debt management plan (DMP), they’ll suggest you a repayment plan working with you and your creditor. By enrolling in a DMP and paying back debts through one monthly payment, you can repay your debts in full within a certain period. Enrolling in a DMP, through a credit counseling agency, will be added to your credit history, but it won’t hurt your score.

 

These Millennials Will Turn Your Money Into Magic

Incredibly honored to have been included in the following article from gobankingrates.com
Nine millennial personal finance bloggers share their top tips.

Millennial mom Robyn created A Dime Saved to provide personal finance advice for the newly employed and newly graduated.

“The best advice I can give to anyone looking to get their financial life under control is to create systems — a situation where good financial habits become routine,” she said. “Set a clear and easy budget that works for you. Automate saving amounts and auto-pay your bills. Create reminders on your phone for those things that you cannot automate.”

Robyn said that automating is the key to saving: “When money is deposited into a savings account as soon as your paycheck hits your bank account, you are less likely to go ahead and spend it. But don’t rely on your own self-discipline — create an automatic payment that does it for you.”

Feast on a Budget

Big, family meals. Tables laden with food. Drinks flowing. It’s holiday season and a time for celebrating. But the holidays can be a stressful time if you are on a strict budget. When you are living very carefully on the money that you have, extra expenses can really be a struggle. There are some who go all-out on Thanksgiving and don’t really care to spend extra on this once-a-year occasions but remember that if you are putting money on a credit card to pay for your expenses you will regret it later on. You don’t want to be paying for your Thanksgiving meal in February. The best way to tackle the large expenses of the holiday season is to put aside money for holidays all year round. I have an “envelope” for holiday expenses which I try to fill every month. But even with saving, money is finite and holidays are expensive. So….

Here are some tips to save money on your big holiday meals:

  1. Serve soup. Starting a meal with a nice soup is a good way to fill up on something cheap and festive. You want your family and guests to fill up on the cheaper items first so that you can skimp on the more expensive stuff. Don’t get carried away and make a fancy, expensive soup with lots of ingredients! A simple cream of potato or zucchini soup is fitting start to an elegant meal but a very cheap and filling dish. Soup can also be easily frozen as leftovers (see #7).
  2. Serve bread and dips. A yummy (homemade) bread or rolls is a good, filling way to start the meal. Any plain bread recipe can be elevated with the addition of some roasted garlic or herbs. A simple tehina or hummus dip (can be homemade) to dip the bread in will get the meal started.
  3. Lighten up the sides. Many traditional side dishes are based on pretty cheap items- sweet potatoes, potatoes, stuffing etc. Cut down on the margarine, butter, salt and oil to make the vegetables less heavy. The cost savings may be minimal but the lighter version will be easier to swallow and will encourage guests to eat more of these vegetables. A light lettuce or tomato salad is another easy, cheap side dish.
  4. Shop around for the turkey and other main dishes. While it not exactly practical to shop around for the best deal on each ingredient- especially if you are cooking all week!- pick the most expensive or most used ingredient and find a deal on that. For thanksgiving, this will probably be the Turkey. If you save $1 dollar a pound on a ten-pound turkey, you will save $10. That is worth driving a little extra for! Keep an eye out for grocery stores offering coupons or deals on other more expensive ingredients like nuts, throughout the week.
  5. Cut down on drinks. Soda, punch, and juice add expense to your meal. Consider serving water or a homemade lemonade or sumac juice to cut down on costs and make your meal a little healthier. Some lemon slices or fresh mint in a pitcher of water make a festive addition to your table with very little cost.
  6. Sweet potato vs. pecan? While it may not be worth it for you to cut down on all expensive ingredients or dishes (Thanksgiving is one time a year, after all!) it may be worth it to cut down on the more expensive dishes on the menu. A smaller piece of pecan pie can be served next to a larger slice of sweet potato pie. The more expensive the ingredient- the more sparingly it should be used.
  7. Leftovers! It goes without saying (but we are saying it anyways)- save leftovers. Take the time after your exhausting day to properly pack up and fridge or freeze leftovers. Don’t leave all food to be eaten the next day. Freeze some dishes to keep for those days when supper is just not happening. Instead of ordering pizza, pull some leftovers out and you will be grateful you took the time to freeze it!

Do you have any tips to cut down on expenses for the big meal? Share on Twitter or leave a comment below!

Emergency Fund: A Primer

  • 43.3% of Americans have less than $500 set aside for a financial emergency
  • 34.5% of Americans don’t have an emergency fund at all

and 14.5% of Americans don’t even know what an emergency fund is. (Source)

This post is dedicated to that 14.5%. You know who you are. Or maybe you don’t. But maybe you can read this post and then you can have the amazing honor of lowering that percentage. These types of statistics are what led me to start my blog.

Emergency Fund: A Primer

What is an emergency fund?

Exactly what is sounds like. Basically its money that you put aside to help you cover emergencies

Why is this different than other savings?

Because when we talk about savings we usually are talking about money that you are investing in a way that will make you money. You want the money to grow. An emergency fund is not meant to be invested. You just want it there when you need it. This means that you want it easy accessible. Think about a pile of cash that you can pull out in case of emergency. You want it readily available Of course, a pile of cash is NOT a safe way to keep money (although having some ready cash is always a good idea) but that is basically the point. I personally do keep my emergency fund in a savings account that earns interest but it earns very little compared to other accounts and it has no penalty for taking the money out.

Why do I need it?

Cuz life happens. Cars break. People get hurt. Medicine needs to be bought. Jobs get lost. People die. People get very sick. Crucial appliances get broken. The list goes on. The more catastrophic losses in life are usually covered by insurance- most people don’t have the cash to be able to cover rebuilding a house, for example but the smaller things in life have to be covered by you. Of course, covering an insurance deductible or co-pay can also be an emergency.

The hardest thing about emergency funds is that the harder you find to save for it- the more you are in need of it. Think about it- if you are living paycheck to paycheck then you can’t actually afford ANYTHING else-let alone a flat tire. Once when I was going through a long period of under-employment I used my emergency fund to buy my son $20 worth of medicine. If you barely have the medicine to cover basic bills, then an emergency can really knock you down.

Recently, there have been hurricanes and wildfire that forced many to evacuate. Having money to pay for transportation, for alternate shelter, for equipment to secure property, generators etc. can minimize the financial devastation that can be caused. In addition, having money gives you OPTIONS. For example, you can choose not to stay in a public shelter or you can decide to evacuate a if you are in a non-mandatory zone that is expected to be hit hard.

Why can’t I borrow money for an emergency if I need to?

Assuming that someone will lend you money (not always a given- even credit cards have a nasty habit of having pesky things such as credit limits or insisting on knowing that you have a way to pay them back so unemployment can get a card canceled) borrowing even small amounts of money from a private lender or credit card can spiral very quickly out of control. While you may get a bank-sanctioned loan for a low interest rate, usually an emergency would necessitate an unsecured loan that usually have very high interest rates and fees. The worst of these are Payday lenders who charge ridiculously high interest rates for small loans. If you have to borrow even the smallest amount from these kinds of lenders you may spend years paying off the interest. Unfortunately, sometimes small emergencies can cause a vicious cycle of borrowing to pay off other loans and falling deeper and deeper into debt- all for a really small initial amount! The best way to avoid this, (easier said than done) is to avoid the initial loan in the first place.

You may be able to borrow from kind-hearted friends and family but everyone’s resources and patience are limited and they may not be able to lend you the money you need on the terms you need. After all, who says they have an emergency fund? Additionally, there is no quicker way to ruin a relationship than to borrow money that will be difficult to pay back. When weighing a good relationship versus saving money I would pick saving money. “Neither a borrower nor a lender be” but I would much rather be the lender. 

Where I should I keep this money?

The best place to keep an emergency fund is in a regular checking or savings account. As long as you have an easy way to access the cash (checkbook or debit card) then you should be ok. I sometimes put an “emergency” purchase on a credit card and then immediately pay it from my emergency fund. So you don’t need to actually have the cash in your hand. It is good practice to have SOME cash in a safe, secure place to be used in case of emergency as well. I always suggest to have at least a $20 bill in your purse or car to be used for gas or drinks or a lift in case something goes wrong while you are out,

I personally use a CapitalOne360 Savings account for my emergency fund but there are many other $0 fee banks that you can use as well. Only use a bank that doesn’t charge a monthly service fee or withdrawal fee (or that can be easily waived-such as signing up for e-delivery of statements). There are so many banks that don’t charge fees that it is really stupid to be paying for a bank accounts.

How do I start one?

Just start. Take whatever money you can and open an emergency fund today. If you have a bank account that doesn’t require a minimum balance (no reason not to), then you can put $5 in and get started. Look around and see if any banks are having any promotions for opening an accounts. I personally started my CapitalOne360 account when they were having a promotion where they gave my $100 for starting an account with $100 in it. That doubled my saving immediately and gave my the push I needed to continue filling my account (see it’s easy!). Savings should come out of EVERY PAYCHECK. I put 10% of every paycheck into my emergency fund.

It may take you a really long time to actually build your emergency fund, especially if emergencies crop up while you are trying to build it. If that happens- take as much as you need out of your account to cover it and then start over. It took me 5 years (!) to finally have $1,000 in my account.

How much should I put in my emergency fund?

Your first goal should be to have $1,000 in your emergency fund. Why that number? Its nice and big and round and not too big to be overwhelming or out of reach. Dave Ramsey recommends it and it seems like a nice amount, so why not? I have found that $1,000 is about the amount that would be needed to cover a broken appliance, a deductible, or car trouble. If you have an emergency that is more than $1,000 (it happens) then pay what you can- at least you’ll have that much less interest to pay! The ideal level of emergency fund is a full 6 months of living expenses. The theory being that if you are unemployed and bringing in absolutely $0 income for 6 months you would not be evicted or starved. Its a large number and not an exact science so you can make your own calculations but it a good goal to start with. After you have a fully-funded emergency fund you would start investing more in other more sophisticated accounts or assets- so theoretically you could always liquidate those if things get really hairy-but that is a long, long way in the future.

When do I use my emergency fund?

Well, you can pray that you never have to but chances are something will come up that you will have to dip into that fund. An emergency is a “serious, unexpected, and often dangerous situation requiring immediate action” (dictionary.com). An emergency is unavoidable. An emergency cannot be pushed off. An emergency should not have been foreseen in advance. Obviously, its your money and you can do what you want but keep in mind that these should not be considered emergencies: Regular Bills, vacation, Holidays (you knew they were coming), events such as weddings or babies, or anything you can save up for.

Having an emergency fund is one of the smartest things you can do for your financial stability and one of the concepts on which all personal finance experts agree upon (although you may have some disagreement on the size, location etc).

Don’t let an emergency derail you life and your future. Don’t let a small thing ruin your life. Don’t be stressed about where your kids’ medicine is coming from. Build an emergency fund. Have a small piece of mind that you are doing your best to protect yourself and your family from financial disaster.

Blogger Recognition Award

I was nominated by Melanie from Partners in Fire for a Blogger Recognition award. Thank you so much Melanie for all your support! Melanie is a great blogger who is pursuing Financial Independence. Follow her on twitter and subscribe to her blog to receive her latest blog posts by email.

The Award
The Blogger Recognition Award is given by bloggers to recognize others within the blogging community. It’s a great way to recognize each other for the hard work we put in. It’s also a great way to support the bloggers we know and love.
The Rules:
Thank the Blogger who nominated you (me!)
Write a post as to why you started your blog
Include 2 bits of advice you would give to other bloggers
Nominate other bloggers and comment on their response

I am a mother in my 20’s. About 2 years ago, I lost my job. I had 1 child and one on the way. My husband is still a student and brings in very little money with some of his side jobs. That period was one of the worst in my life, but one of the greatest learning experiences. (More on that story later). We lived on nothing. We made it through on my husband’s part-time job and the money I made doing survey’s online (no it wasn’t a lot!) but we were determined not to go into major debt. Since then I have (Thank g-d!) gotten a job. But we are still a family living on a pretty tight budget although we are lucky enough to have no debt (again follow my blog to hear that story one day).

When you spend time so focused on personal finance and being frugal you start to notice how much other people are messing up their finances;) and I realized how much I enjoy reading and learning about personal finances. This meant that I had so much to share on the topic. I quickly realized that I was boring my friends and family with my financial musings and advice so I decided to start this blog anonymously. It’s pretty much a secret from my family and friends.

Thus “A Dime Saved” was born- I offer financial advice for the newly starting out on their financial journey and for those who are not in a position to save tons of money and who have to stretch their food budget every week. Since its my blog I also get to share my own advice and musings on personal finance and life.

I do this blog as a hobby- to get my sanctimonious advice out my system and to utilize my writing skills. If I make some money from this blog then I wont complain! I will just dump it all into my 3-6 month emergency fund which is pretty slow in coming!

My Advice (for what it’s worth):
1. Just do it- don’t think too much about it- post what you can and you can always go back and edit later. Don’t focus on perfection- just share what you can.
2. Don’t focus on the money- I know! I Know! We all need extra money in our lives, especially when you have so little of it. But making money from blogging is a long, slow process and focusing on the money aspect too much can really bog you down. Enjoy the process.

Nominations:
The FI Guys
Guided by Coffee
Mint Habits

About Death and Incapacitation

It is not something we like to talk about or even think about.

A bunch of us were collecting money for a group gift.

“I’ll send you money soon” one women wrote “my husband is not home and I don’t know the login to my bank account. He takes care of the finances.”

I have no problem with any division of labor in a relationship. If a couple decides that the husband should be on charge of the finances completely, I have no problem with that. Do what work for you. If she wanted to wait till her husband came home to discuss this with him or have him handle the money transfer, then that’s great. What I have a problem with is that if something would have happened to her husband- she would not have had a way to access her money.

(Disclaimer: I am using the terms husband and wife in this post but this obviously applies to any type of relationship you may have and whomever you have who takes care of your finances: whether it’s your boyfriend, girlfriend, husband, wife, significant other, mother, father, great-aunt etc.)

Think for one moment (even though you don’t want to)- what would happen if you husband (or whomever takes care of the finances) would die or be incapacitated for whatever reason. WOULD YOU HAVE ACCESS TO YOUR MONEY? WOULD YOU BE ABLE TO USE YOUR MONEY? Do you know where the money is hidden? What the code to the safe is? Would you know where your money is? Do you have the login info? Do you know how to retrieve the money you need? DO you know how to pay your bills?

For some of you reading this, you may think this is crazy. Of course you know this information- if so-good for you! But you would be surprised by how many people (particularly women) DO NOT have this information or access.

I was talking about this with some friends- one person had an issue with this: what’s the big deal? Just reset the password? Just go to the bank with paperwork and they will give you access. Possibly. Probably. But how long would it take? Do you have access to the email account which is connected to the bank account? Do you have paperwork proving you should have access to the money? Can you wait until Monday at 9 am to do this? Do you have time to wait for the manager to verify your identity?

Chances are, when unfortunately dealing with death or incapacitation this is NOT something you want to deal with.

So…

Know where your money is. Know which accounts you have and with which banks. If for some reason, you have separate accounts or private accounts- perhaps consider having a list of some sort (in a SAFE, SECURE space) that lists these details for the person you wish to have access to your account in the event you are unable to communicate with them.

Make sure your spouse knows that passwords to your bank accounts, email accounts etc. If you can’t trust them with this information than perhaps you should reconsider your relationship.

Designate your spouse as your emergency contact and “additional user?” on your accounts, credit cards etc.
If you have separate credit cards, consider naming your spouse as an additional user who has access the credit card as well.

If you spouse is unwilling to give you this information- you must seriously consider why. Financial abuse is a real thing and help is available if you need it. (Contact https://www.thehotline.org/ if you feel you may be the victim of financial abuse)

Again, this doesn’t mean that you have to take care of your daily finances if that doesn’t work in your relationship. Many couples are very happy with the division of labor that they have chosen. That’s ok. But make sure that you have the KNOWLEDGE and ACCESS that you need in case of an emergency.

Caring about someone means making sure they have the ability to take care of themselves after you are gone as well.

How To Save Money on Back to School Supplies

Read the full article where these tips were originally published:  https://www.opploans.com/blog/how-to-save-on-back-to-school-supplies/

1. Make a budget and stick to it. If you have older kids, let them know in advance how much they have to spend. This way they can pick which items they want to “splurge” on and which ones they don’t. They may want to spend a lot on a nice notebook but stick to the cheaper pencils and pens.

2. Shop online and shop early. Many stores have back-to-school deals on certain items already. Quickly glance through some deal sites and store ads to see which items are on sale and stock up on the basics- pens, notebooks etc.

3. Coupon and cashback. Look online for coupons and take advantage of cashback apps. These little savings can add up in a big way!

4. See what you can reuse. Not everything needs to be new every year. Go through last year’s supplies and see what can be used, passed down and what needs to be replaced.

5. Plan before you shop. Make sure you have your school supply lists along with an idea of what items you already have so you don’t end up overbuying. If you have multiple kids that need the same items you may be able to split value packs as well so make sure to have an idea of what each child needs BEFORE you shop.

Happy shopping!

Budgeting on an Uneven Paycheck

Some people get a set paycheck every month, but for many people it fluctuates depending on how much they worked that month, overtime, holidays etc. How do you budget when your income changes all the time?

The most important thing is to budget, budget, budget. Make sure that you are making smart choices with your money, especially in months when you make more.

It may seem daunting but I created a pretty simple system for myself.

  1. Add up all your monthly bills. Round up.
  2. When you get your paycheck-deduct 10% for charity (Maaser). I try to be careful to always include charitable giving in my budget. Although I don’t make much, it is important to keep on giving to others regardless.
  3. Deduct 15% (or 30% or 50%!) for savings. Put this in your savings ladder.
  4. Deduct your bills from this amount.
  5. Decide on a percentage for all variable categories (clothes, spurge, coming soon etc.) to put in your envelopes.  For example,  I usually use 10% for each. Deduct that amount from your paycheck.
  6. The amount that you have left over is for food and discretionary spending. If this amount is too small than lower your contribution to your other variable categories.
  7. If you have paychecks that are truly feast or famine (some months you make significantly more and some months you don’t even make enough to cover bills you will have to put extra in feast months into your bills and food accounts. It will take a lot of self-control and planning but it can be done!

The easiest way to calculate where everything goes is to use an Excel spreadsheet. Simply set it up with your desired percentages and your total bill amount, and then every month put your paycheck amount in and Viola! Each amount is calculated for you. I have attached a sample excel spreadsheet here. Play around with it and work out which numbers work best for you!