5 Financial Resolutions for a better and brighter 2015

This I got to post. If you're going to make a New Year's resolution, this must be included. You can't pretend that you're doing well financially if you have not done these major financial resolutions yet. 2015 is your time to start doing these. I hope this helps.

In a few hours, we’ll be welcoming the New Year with hope and enthusiasm. After all, it’s a chance to start our lives anew. We can pursue the dreams we may have left off, or perhaps start building something fresh and entirely different. The feeling that you are given a clean slate is exhilarating and exciting. It leaves you inspired to take on goals that we have yet to find the courage to start… until now.

5 Mistakes You Make When Managing Your Debt

Good afternoon. Today, since we're all on holiday, and the typhoon Maring is bringing a lot of rain in Metro Manila, I thought of surfing the net. And I found this article from FoxBusiness by Allison Martin (Credit.com) on managing our debt. I would like to post it here for us to study and hopefully apply some of it's recommendations so that debts can be erased soon.

Not all debt is created equal. With that being said, there is no one-size-fits-all approach to managing your debt and avoiding excessive interest, fees and other penalties that could result if not handled properly.

Here are five mistakes consumers commonly make with their debt (and ways to avoid them).

1. Depleting Your Emergency Fund

If you have a substantial amount of cash in your savings account, allocating a vast majority of it to get out of debt may seem like the wise thing to do. However, the problem with this approach is that it fails to get to the root of the problem. The ultimate goal should be to get out of debt and stay out of debt, and not simply write a fat check to serve as a temporary patch. It is more sensible to jump-start your management efforts and cut costs elsewhere in your spending plan because emptying out your emergency fund can mean even greater debt if an emergency arises and you do not have an adequate amount of cash on-hand to cover the costs.

2. Having No Plan of Action

Taking a lax approach to your debt is a recipe for disaster. You may eventually achieve your goal, but the process may be lengthy and tedious. Just imagine a college student who randomly takes courses that appeal to them without ever looking at their transcript to see what’s needed to graduate.

Save yourself the headache and devise a detailed debt repayment plan that incorporates your financial goals.

3. Getting Caught in the Minimum-Payment Trap

Making the minimum payment each month may give you more flexibility in your budget, but you more than likely will never get out of debt. In most instances, particularly if the outstanding balance is high, the minimum payment may only cover interest (or not much more), leaving you with an untouched principal balance.

Instead of making this mistake, allocate as much money as possible toward your monthly payment, even if the amount is way more than the minimum, to ensure that your payment efforts are not in vain.

4. Robbing Peter to Pay Paul

Advancing cash from one debt source to another solely for the purpose of making your monthly payments may cause you to end up in a bigger financial crunch than you initially bargained for. If your financial situation is dire and you‘re robbing Peter to pay Paul just to make timely payments, reach out to the creditors and request that they grant you some sort of temporary relief until you are able to sort things out.

In addition, refrain from using any sort of financing to pay for purchases unless it is absolutely necessary.

5. Ignoring Statements and Credit Reports

Both your statements and credit reports paint a picture of where you stand in terms of your debt obligations. Ignoring these documents can be very costly and time-consuming down the road if inaccuracies exist because errors that are not promptly reported may be more difficult to dispute.

To avoid these issues, immediately review your statements each month when they arrive to verify their accuracy. If discrepancies exist, report them as soon as possible to the creditor so that the issue can be resolved before the inaccurate information is reported to the three credit bureaus. Also, review your credit report at least once every four months for mistakes – you can get them for free once a year through AnnualCreditReport.com. You can also monitor your credit once a month for free using the Credit Report Card.

Personally, I have applied Item # 2 and # 3 in dealing with my credit card debt. So far, I am now almost out of the rut and setting myself debt-free.

What's your plan?

To your debt-free life,
Jimmy

Read more: http://www.foxbusiness.com/personal-finance/2013/08/20/5-mistakes-make-when-managing-your-debt/#ixzz2caIWfRCz
Photo credit: http://money.howstuffworks.com/personal-finance/debt-management/debt3.htm

Are You Tired Of Your Lingering Debt?

That's the big question that many of us want to be answered. I have been there. It's only fairly recently that I am seeing changes in my finances. Would you believe that I have savings or should I say some investments now in the Stock Market? It's not BIG but compared to when I was working in Makati, I now have some!!! And I know it will grow. That's it, you need to know how to grow your money in order to get out of DEBT!

Here's an encouraging news that our mentor, Bo Sanchez, sent to all members of the Truly Rich Club. You see, I decided that I needed a mentor to help me grow my money. So, I joined the Truly Rich Club and since then I had taken advantage of every lesson being taught by Bo.

You will be informed and you will have to also make a decision when you read this very good article by Bo Sanchez.

Want Of Create Your Future Millions Through The Stock Market?  Now Is The “BESTEST” Time Get In.

          Forget my bad grammar.

          I’m making a very important point.

I believe that everyday is the BEST time to start investing in the Stock Market.  No kidding.  Because to start is glorious.  So many people don’t start!  All they do is talk about starting.  (Does this sound familiar to you?)

But there are days that are BESTEST than others.  (My Grammar teacher in grade school is rolling in her grave right now.)  And this month is one of those BESTEST days.

Why?  Because the Stock Market is down.  You see, in the past four months, we saw the Stock Market go up like a turbo rocket.  It went berserk.

But now, it MUST go down before it goes up again.  That’s just its cyclic nature.

That’s why—if you haven’t started investing in the Stock Market, get into it NOW.

Is This For You?

By the way, my letter today isn’t for everyone. 

Please disregard if this isn’t your concern.

I don’t expect everyone to join my TrulyRichClub.  

If this isn’t for you, I apologize for bothering you with this letter.

Because today,I’m specifically writing to people who want to grow their financial life—and who want my guidance in investing in the Stock Market.

Are you tired of being stuck in a rut in your finances?

Are you tired of your lingering debts?

Are you tired of feeling the pain of wanting to help people you love, but can’t, because you don’t have the resources?

Are you tired of your big fears and uncertainty?

Are you tired of working very hard everyday, only to realize that you don’t really have any savings for your future?

Just in case you’re that person, let me help you.

To know more about my TrulyRichClub, click the link below:

Yes Bo, teach me how to grow my money!

Tell me more aboutthe TrulyRichClub

May your dreams come true,

Bo Sanchez

PS. Don’t Miss This Window Of Opportunity When The Stocks Are Low.  To know more about the TrulyRichClub, click the link below:

Yes Bo, teach me how to grow my money!

Tell me more about the TrulyRichCl

Do You Manage YOU?

This is true. I always tell my students in our Work Ethics And Values Seminar at Uno Overseas Placement that they are running a business whether they like it or not. And that business is their LIFE.

Looking at my own life, I think I can honestly say I am having an exciting but hard time to make my "business" a  profitable one.

When I read this article from someone I admire, I was encouraged by Dave Ramsey when he wrote this wonderful and practical article entitled: "You Inc: Manage Your Money Like A CEO". He knows what it is to be in debt and how to get out of it as well.

You will certainly appreciate his ideas and it will help you start a good habit of managing your money well. So, here it is for you.

"If you managed money for ‘You, Incorporated’ the way you manage money for you now, would You hire you?"

What We Say Matters

Its been hectic these last few weeks. What can big debt do to a person? More specifically, how do you deal with at least four banks running after you and collecting from you huge amount of money?

For a simple guy like us, that means a lot of worry and anxiety. My blood pressure would probably rise due to tensions running high. Sleepless nights. No appetite for food. These are just some of the consequences of debt, which are due and collectible.

During these times of crisis, people blur out words that are not helpful to solving the problem. Words are very important. What we say, the words that come out of our mouth, are like the "steering wheel" of cars or the "rudder" of big ship that can steer that thing to the direction the driver wants to take it.

Most often, during this times of crisis we say words that have negative effects like "there's no more hope", "I am going to jail for this", or "there's no more solution" to this problem. You know what a person believes by what comes out of his or her mouth.

Proverbs 21:18 says "Death and life are in the power of the tongue. An they that love it shall eat the fruit thereof." In other words, what comes out of our mouth determines life or death. If we choose negative words, you shall eat it and it will happen.

Choose to say what you want to see happen in my life. Because your tongue, what I you say, is the steering wheel of your life!

So if you want to get out of debt, even huge debts, the solution doesn't start from your bank accounts, or from your friends, and relatives' help. It starts from your mouth. What you say is the steering wheel of your life. You say what you want to see happen to your debts. Try it, it works.

To yours and my debt-free life,
Jimmy

To Love It Or Love It Not

I would like to post this very good article on the love of money by Dave Ramsey. He says that our view of money is important if we plan to get out of debt. How we spend our money is directly related to our perspective of money. So here goes "Love It Or Love It Not" by Dave Ramsey:

A lot of people love Benjamin Franklin.

Oh, come on. Admit it. You're probably pretty fond of Benjamin Franklin, too. He's the guy on the front of the $100 bill, and you're not going to say you don't love $100 bills, are you?

If we're honest, most of us love money. Actually, we love money we don't have. How else can you explain our addiction to credit cards? Our culture loves money so much that we have television shows dedicated to showing off people's million-dollar houses and garages full of luxury cars!

Every day, we see thousands of ads that promote the dollar as the end-all-be-all ticket to a happy life. But we know better than that...don't we?

Wait a minute, you say. Doesn't Dave Ramsey talk about building wealth all the time? He sure does. But Dave is talking about a healthy view of money. The foundation of Dave's ideas of wealth building are that you get out of debt and build wealth so you can help your family and others … and leave a legacy after you're gone.

It's also okay to want to make a lot of money and to enjoy spending it! But what's the end goal? Is it to own stuff, or is it to help others and to change your family tree?

A lot of us have an unhealthy view of money. The Bible says that "the love of money is a root of all kinds of evil." It's that type of "love" that drives us to buy stuff with money we don't have to impress people we don't like.

For some people, the "love" of money is more like an obsession or an addiction. It can drive a wedge between spouses and teach kids that stuff is more important than anything else. It can lead to divorce and broken families. When we talk about changing your family tree, that's not what we have in mind!

Think of money as a tool. You can use it to help yourself and others, or you can use it to tear all of that down. You can use it to save for your kids' college fund, help your church or favorite charity, or you can use it to buy a bunch of stuff that will be collecting dust two years from now.

A healthy love of money will drive you to get gazelle intense about working through the Baby Steps and getting out of debt. It will motivate you to make better decisions with your money—decisions that involve only spending on needs, not wants. You will view life through a new lens, a lens that puts your future and the well-being of your loved ones first. Don't let money and stuff run your life.

There's no need to obsess over Benjamin Franklin. Plenty of other people will do that. With Valentine's Day just a few days away, remember who and what is important in your life, and keep that in perspective this year.

Thousands of other people are on their way to making better decisions with money this year. With hundreds of Financial Peace University classes starting across the country, now’s the perfect time to join them on the road to Financial Peace!

A healthy perspective of money will help you spend it wisely and sets you up to a debt-free life.

To your debt-free life,

Jimmy


Photo credit

The Battle Against Unbearable Debt

How can one win over unbearable debt? This is a big question I keep asking myself when I hear our overseas workers' financial struggles. Even before leaving for work abroad, they are already in deep debt but there's this nagging hope that their problem will soon be over.


Guess what? After working for 3 years, most come back with nothing and the worst part is they are still in debt.


Benjamin Pimentel's article on How overseas Filipinos can win the battle against unbearable utang (debt) clearly explains the reason why many of our OFWs end up deeper in debt compared to their goal  of eliminating debt, which is the very reason why they leave to work overseas.


I would like to cite a portion of his article that I believe is the key to getting out of this unbearable debt:

"OFWs should and must undergo financial literacy to protect and harness their money which is more often lost and squandered," he said.

Let's affirm a key premise here: Overseas Filipinos perform a vital role by sending money back home to help their families. But there¿s also a growing need for families to find better ways to manage funds coming from abroad.

And we're not talking about totally avoiding debt. In many cases, as I've noted, debt is necessary to meet a need.

But there's such a thing as smart debt and dumb debt. Worse, there is unbearable utang - debt that becomes so overwhelming that overseas Filipinos end up wearing themselves out as they find themselves trapped in a vicious cycle.

Charito Basa, an OFW advocate based in Europe, listed four general principles for overseas Filipinos and their families (which actually applies to everyone in this time of crisis):

Have a budget and stick it to it no matter what

There'll be special requests from family and friends that will tempt migrants to deviate from their budget," she says. Be firm. People will eventually understand that they are doing it for the good of everyone."

Save first, before spending (not the other way around)

Set aside a fixed amount for savings. Charito recommends at least 10 percent of one's income. She and Tony Ranque point to the tested formula for sound personal finance management: Income minus Savings equals Expenses.

Saving a portion of your income is a must, not an option," Tony says. If you cannot develop the habit of savings which is founded on discipline, force yourself to save by getting pension plans and other types of pre-need plans."

Have insurance (health, education, retirement, pensions)

When done through reputable companies, insurance plans can guarantee that needs are attended professionally and that funds are available when most needed," says Charito.

Stay away from "get-rich-quick" schemes

This rule also applies to everyone.

My experience tells me that most of our OFWs are not financially literate. This, I believe, is the main reason why they end up poorer that when they first left for work abroad. They just can't find time to educate themselves in money matters because they are too busy running after the money.

The painful reality is when their contract is finished, in a few months, they're broke again or you see them lining up to apply for work abroad again.

So, how can our OFW win over this unbearable debt? Maybe you have a better suggestion we can all use. 

To our debt-free life,

Jimmy

Photo credit

7 Worthy Resolutions To Commit To In 2012

Hi there. I have been away for a while. Japan is now in winter season. Visited our Filipino workers around Takamatsu in Kagawa-ken. It has been a fruitful monitoring. Just by seeing them and being where they work, brings joy and refreshing to these precious people.

Together with the industrious lady welders in Takamatsu

At the highest point in Tsuda, Kagawa-ken

With the lady Chicken Choppers

On my way back home last January 17 on PR 407, I was reading an article on the Philippine Star. This particular article caught my attention because it speaks to retirees, of which I am within its zone!

Took this photo at the Kansai Airport on arrival

But I believe the resolutions mentioned by AP can be applied to younger ones too. The author mentioned Seven (7) resolutions for retirees in 2012.

Although I can go on retirement mode, I made a conscious decision not to retire yet because I feel that my best days are still ahead of me. There's no time to stop doing what I am called to do.

Now, let me give you my take on this article.

First of the resolutions mentioned is the call to get disciplined about money matters. The best way to do this is to set up a formal budget and stick to it. Being thrifty without a plan only goes so far when unexpected expenses arise, especially at an age when health care costs can start to mount. How true this is.

Attack your debt. The top priority is to pay off credit card debt. After the card is zeroed out, use only one card and pay off the balance monthly. If an emergency expense leads to a balance, don't let it linger or it will erode retirement savings. Having only one credit card is a very practical suggestion indeed.

The other resolutions include:
1. Invest in dividends-paying stocks
2. Get your estate plan in order
3. Be more generous
4. Check into long-term care insurance possibilities

The last one is especial to me: Stretch your body and mind. The author says we need to choose daily pursuits that keep you physically, mentally and socially engaged. Physical activity helps us to live longer, feel better, depression free and keeps our mental skills sharp. I take physical exercise as a necessity for my body that's why I play badminton and brisk walk at least three times a week.

I can't help but notice the mental sharpness of Justice Cuevas and Senator Enrile in the current impeachment trial of CJ Corona. They are in their 80s yet they are still sharp as ever. This is also the main reason why I blog!

What about you? Do you feel you can use these resolutions for 2012?

To our debt-free life,
Jimmy

GET OUT OF DEBT: 6 STEPS YOU NEED TO TAKE

The New Year is full of hope and excitement. Many are looking forward to a bright year ahead. This includes goals like having a new car, promotion at work, increase income, better relationships, better house, and probably more travels. The list goes on. 

For me, I have decided that I will look for ways to increase my earning capacity for two reasons: to speed up the process of paying my debts and to celebrate my birthday in May, my first since I can remember! I want to save towards that meaningful event of my life when I turn 60. What A blessing!

I am posting this article by MMarquit entitled "Get Out Of Debt: 6 Steps You Need To Take" (Coupon Shoebox). The thing that really cool about this article is it's simple and easy to do. My wife and I start our year by revisiting our last year's budget and making changes to arrive at our 2012 budget. Part of that process is listing all of our debts as suggested in item no. 3.

I know it will be of great help to you as you do what MMarquit says. Cheers and Happy New year!

One of the most important financial lessons that you can learn is that debt is prison. Indeed, when you are paying interest on your debt, that money is going straight into someone else’s bank account — and you receive nothing in return. Plus, paying that interest makes it harder to pay down the principal and to reduce your debt. Even though it might be difficult to get out of debt, it is doable. Here are the steps you can take to get out of debt.

1. Really Decide That You’re Getting Out Of Debt

The first thing you have to do is decide that you are really committed to getting out of debt. You need to truly want to change the way you do things, and get serious about paying down your debt and getting on the path to financial freedom. Without the commitment to get out of debt, you are likely to give up.

2. Stop Adding To Your Debt

Take a look at your budget, and figure out how you can better live within your means. Before you can effective tackle your debt problems, you need to stop making purchases with debt. Look at your spending, and cut back on the unnecessary items so that you are living within your means.

3. List All Of Your Debt

Next, list all of your debts. List the balances, minimum payments and interest rates. Decide on an order to pay them off. Many people like the “debt snowball” method. You take that lowest balance debt, and concentrate on that first. This method is psychologically rewarding, since you see success faster, and are encouraged to keep going. Others, though, prefer to start with the debt with the highest interest rate, since it will save more money in the long run, since you will get rid of the most expensive debt faster.

4. Decide How Much You Can Put Toward Debt Pay Down

Now that you have prioritized your debt list, it’s time to figure out how much money you can put toward your debt pay down. Honestly evaluate your spending, and look for places to cut back. You should be able to find waste in your spending, and, instead of spending it on frivolities, put it toward paying off your debt. Pay the current minimum on all of your debts, except the one at the top of your list. Put your debt pay down amount toward that debt. The more you can put toward it, the better.

5. Look For Ways To Earn More To Speed Up The Process

If you want to speed up your debt repayment process, you can look for ways to earn more money. Start a side hustle. Get a part-time job. It’s only for a little while. If you can put your debt repayment efforts into overdrive, you can be free that much sooner — and you will reap the benefits.

6. Acknowledge Your Successes

You can stay motivated when you acknowledge your successes and take time to reward yourself. Don’t go big though — you want to stay out of debt. But you can hold a little celebration, or you can retire each debt in a creative way. Buy a small treat, or cook your favorite dinner at home. Be sure to mark each milestone, and get excited about your next step toward success.

Looking forward to 2012, debt-free,

Jimmy

P.S. Last year, I decided to start blogging in my desire to create a new stream of income. However, as I learn how to blog, I found that beyond making money, I can express my passion and help others find answers to their problems and challenges. Today, I am grateful to my mentor, Jomar Hilario, for teaching me how to blog and hopefully to be like him someday. If you are interested in blogging, why don't you join me at Online Mentoring Club.

Photo Credit: http://www.gettyimages.com/detail/photo/files-with-labels-royalty-free-image/92347801

Thank You For The Blessings!

I am grateful to God for this year 2011. Looking back, I see many blessings that have come my way.  It is always good to count our blessings, list them and thank God for them.

I have learned that nothing is solved by thinking and focusing on my problems.  Focusing on the negative things that happened in my life, including thoughts on how to deal with DEBTS, make these problems bigger than what they really are. So, why waste time thinking about the negative things?

Today, I would like to thank and praise God for these blessings:

1. My wife, Maritess, who has been very loving, understanding and supportive of me
2. My 3 daughters, who have grown to love the Lord and are now professionals in their own right
3. My son-in-law, Allan and our first grandson, Jesse Alexandre
4. My Pastors and mentors: Colin Shaw and Ian Shelton
5. My brothers, who are very caring, brotherly and fatherly to me: Larry, Ralph and Butch Plus their wives, Gina Mae, Del and Babylin respectively
6. My dear close friends, many of them, imagine that? Wow. Ramon & Elvira, Andy & Cristy, Edna C., Gene & Zeny, Edna & Ador, Daisy, Bing & Virgie, Dennis & Divine,  Bong, Gwyn, Rose, hah-- too many to mention... thank God for each one of them
7. My house of 14 years 
8. My 17 years old Toyota Corolla, which is ably maintained by Chief Ruel Larrosa, owner of Exalta Auto Shop in Banawe, Quezon City. Thanks so much, Chief
9. My dear sisters Jean and Julie
10. My brothers, Jessie (my disciple)& his wife, Greta and Nonoy
11. My good friends, Adel Lacson, German, Domeng Jose, Radley
12. My new pairs of Hush puppies shoes
13. The gifts I received this Christmas: A pair of Sanuk shoes, pink shirt, hankies, Samsonite laptop bag, too many to mention too
14. Uno Overseas, for the job and opportunity to preach the Gospel to our Interns going to Japan
15. For the health card provided by CRC and Uno, a big help for Maritess and I
16. For the money we receive every payday
17. For Jomar Hilario, my internet marketing mentor 
18. For the almost weekly massage at Rilassante Spa located at Banawe infront of the Orthopedic Hospital
19. For the discounted Dr. Pi Water from Tere and Mario Lontok, hehehe
20. For the Scalar Pendant and Scalar Flask we bought from Adel. It really helps increase my energy level daily and in lowering my blood pressure. Try it
21. For the Mercy, Grace and lovingkindness of the Lord Jesus Christ, my Lord and Savior!

There are many more. I tell you, if you try writing them, you'll never run out of things to thank God for.  I have made it my New Year's resolution to count my blessings everyday in order to overshadow the seemingly negative things that try to disturb me every now and then. 

Give thanks to the Lord for He is good for His mercies endures forever!

May the coming year be a blessing to us all.

May the Lord Bless you and keep you. May His face shine upon you and be gracious to you. May His  countenance be upon you and give you peace!

May 2012 be the start of a debt-free life for all of us.

To your debt-free life,

Jimmy

Emotions: One Famous Budget Buster

We are now in the holiday season and of merry gift giving. It’s called Christmas. Here in the Philippines, we take this season seriously since we are a Christian nation, in fact the only Christian nation in the Far East.

So what has this season got to do with our money and with our budget? Everything. Let me explain.

As I write this article, we’re now about 20 days before Christmas. If you are observant, you’ll here Christmas carols being played on the radio, TV and especially in the Malls almost every hour if not minutes. Newspapers are full of ads about Christmas gifts and they proliferate in the all media too. I know that we need to celebrate the love of God. This love is expressed by sending His only begotten Son, Jesus Christ, to save mankind from sin. This is the essence of Christmas, Jesus being born as a man in a manger. But, we all know that this is also the season for merry making, thus we call it Merry Christmas.

For God so love the world that He gave His only begotten Son so that whosoever believes in Him shall not perish but have everlasting life (John 3:16)

This is where emotions come in. Advertisers, manufacturers, store and mall owners know this well. They hype this to the max. Advertising appeals to our joy, expectations and even fears hoping to stir us emotionally so we buy their products or services being peddled. This is the power of emotions.

Homeworld's ad: very enticing!

My wife and went to the hospital this morning to see her doctor and for me to have my laboratory test. While waiting for our names to be called, I picked up the newspaper and happen to read Francis Kong’s column called Business Matters. In his article, entitled: What is a business plan, he said this: “Most people make emotional decisions and come up with the weirdest reasons to justify those. Take shopping for instance. Most equate shopping with an experience, which deals more with the emotional side of things rather than the rational. And watch how people mob stores just because they’re selling stuff at 70 percent off. And sometimes, even when you know your budget is limited, or that you don’t have the resources to make that expensive purchase, you go ahead and make it anyway. These instances have little, if any, to do with logic. But they have everything to do with emotions.” I like what he said. Emotions are very important, but I need to conquer and master it. I’ve learned my lesson last year.

Watch your emotions

This Christmas season, my wife and I have made a decision to control and master our emotions so that this will not affect our budget and end in debt. Yes, it is Christmas. We will buy gifts but not to the extent of going beyond our means. Be safe, be in control of your emotion and enter 2012 a debt-free person.

Merry Christmas!

To your debt-free life,

Jimmy

Photo credits:

http://www.flickr.com/photos/25509772@N00/5248229695

http://www.smdeptstore.com/smdept/?p=1524

http://farm3.http://farm5.staticflickr.com/4070/4260460351_be16ebb713.jpg

http://www.flickr.com/photos/28705377@N04/4260460351/sizes/m/in/photostream/

How to Manage Household Expenses When You're Married

This is a very good article for married couples. I came across this article on SmartMoney. The only difference is in the way my wife and I manage our finances. We don't separate our money/accounts. We have a merge or common account, which is transparent to both. We plan together and decide together. What about you? I hope you can get some helpful tips from this article.

Sharing a checking account may be one of the hardest things about sharing a marital bed. In fact, three in 10 Americans who've combined finances say they've deceived their spouses or partners when it comes to money matters, according to a 2010 survey by the National Endowment for Financial Education. Whether you're newlyweds or have been married for decades, there's always time to walk down the path to financial harmony. Here's what you'll need to do.

Decide what's common and what's separate. Decide whether to keep separate bank accounts, merge everything or a bit of both.

• Count your debts. Create a checklist of all the debt each spouse is entering the marriage with and determine whether that person will pay down his or her loans or if both spouses will chip in.
• Decide how to pay for household expenses. Some couples create a joint checking account, and each spouse contributes money to pay for household expenses like the mortgage, utilities and groceries.

Get serious about saving. Your expenses will only grow as you get older, which means you need to start saving now.

• Prepare for an emergency. Financial emergencies cause stress; stress causes discord. And while you can't avoid the emergency, you can avoid the stress. Put three to six months of living expenses in a savings account or money market account and keep it strictly off limits until there's a real emergency.
• Check in annually. Arrange an annual meeting with your spouse to review your financial health. List all assets, debts and sources of income and set long-term goals. If you're in your 40s, start talking about retirement goals, too.
• Make a plan. Use this SmartMoney calculator to set your investment goals, and check out this article in case an emergency strikes when you're cash-strapped.

Chip away at debt. Households with less debt have an easier time qualifying for a home mortgage and can also save more for their future.

• Have roles. Decide who will be responsible for keeping track of the bills and paying them. For unsecured debt, like credit cards, try to pay more than the monthly minimum and pay down the highest interest first.
• Save before spending. Create a strategy to save for one-time expenses, like a vacation or a new piece of furniture, without incurring debt.
• Figure out where you stand. Use this SmartMoney calculator to find out if you have too much debt and this calculator, which shows how much interest borrowers will pay by the time their credit card balance is paid off.

What not to do. The biggest mistake is to start arguing over finances, and that usually happens after one of these mistakes:

• Don't keep secrets. Spouses often overspend and hide it from their other half. It's only a downward spiral from there.
• Don't give up financial control. Just because one of you makes sure the bills are paid doesn't mean the other can live in la-la-land and spend without consequence. In this case, ignorance isn't bliss.
• Don't collect bad debt. Carefully consider getting a loan for a depreciating asset, like a car, because at some point you could owe more than it's worth. And stay away from credit card debt; balances can rack up quickly at very high interest rates.

I like the suggestion about chipping away debt. Everything starts with a plan. I am sure you will have one when you're done reading this. It's the only way to take control of your finances.

To your debt-free life,

Jimmy

Budget Busters

I am posting a very good article today from Crown Financial Ministries. This article has lots of practical suggestions designed to enable you to take control of your finances. When we avoid these "budget busters", needless to say, we also effectively cut down on our debts. I hope this will help you just like it helped me. 

Budget Busters 
by Crown Financial Ministries

Budget busters – areas that can result in financial disaster.

(The following percentages are for a 4-member family with an annual gross income of $130,000 or less. Net Spendable Income (NSI) is money available after tithe and taxes.)

Housing (38 percent of NSI)

• Don't buy or rent a house you can’t afford – total housing includes mortgage, taxes, insurance, utilities, phone, and maintenance.
• Don’t finance closing costs or secure a second mortgage for a down payment.

Food (12 percent of NSI)

• Plan and stick to written weekly menus.
• Don’t shop when hungry or hurried. Do shop specials, store labels, and use coupons.

Automobile (15 percent of NSI)

• Buy quality used cars you can afford, and don’t trade in before car’s usefulness is over.
• Auto price, maintenance, gas, tags, taxes, and insurance are all part of cost.
• Consider dropping collision insurance on cars more than four years old.

Debt (not housing or auto – 5 percent of NSI)

• Establish a payment schedule to pay all creditors regularly, and get rid of credit cards that you can’t pay in full each month.
• Sacrifice wants and desires – buy with cash until debts are current.

Insurance (5 percent of NSI – if your employer provides medical insurance)

• Find a well-informed, trusted insurance agent to get the best possible provision for the money.
• If you have no medical coverage through employment, consider major medical insurance – it can covers up to 80 percent of medical expenses due to catastrophic illness or injury.

Recreation/Entertainment (5 percent of NSI)

• Recreation-oriented Americans, who are in debt, shouldn’t borrow to entertain themselves.
• Plan vacations during off seasons, select local vacation destinations, consider camping.

Clothing (5 percent of NSI)

• Save money and buy without using credit.
• Purchase off season if possible, and select home washable fabrics and outfits that can be used in multiple combinations.

Medical and Dental (5 percent of NSI)

• Prevention is cheaper than treatment.
• Teach children to eat the right foods and clean their teeth properly. Good diet, rest, and exercise will most likely result in better health.
• Ask doctors and dentists in advance about costs, shop for prescriptions, and ask for generic drugs.

Savings (5 percent of NSI)

• Without savings, the use of credit and debt becomes a way of life.
• Use payroll deduction for savings. If it’s not available, your bank can automatically withdraw from checking account to savings.

Remember budgets don’t operate on auto-pilot, they require effort and family understanding. If you’re determined to achieve and maintain a debt-free lifestyle, then living on a budget is essential. Don’t bust your budget.

It is wise to pay attention to these practical and useful suggestions. It takes time and effort to do these but when we follow them, they become part of our lives that will cause us to be in control of our finances.

To your debt-free life,

Jimmy