Browsing Category: Money Tips

Amazon Prime Membership Benefits

When we first signed up for Amazon I had used their Mom membership. We just had a our baby daughter and I heard about the significant discounts Amazon had for diapers and other baby supplies. When that deal ran out I used Prime and really enjoyed the shipping benefits. I also loved their Instant Video options and this year, some of shows are available to watch as they air. Since we’ve cut back on cable, this has been a huge plus for us as I don’t have to miss some of my favorite shows or wait for them on Netflix.

Our anniversary date is coming up and we will be charged the new membership fee of $99/year. As with all of our subscriptions and memberships, we take a review to make sure the benefits outweigh the costs.

Amazon Prime Beefing Up Benefitsamazon prime benefits

As I went on the site to check things, I discovered the company has been adding new features and benefits to Prime.

  • Free 2 Day Shipping for eligible purchases
  • Unlimited streaming of movies and videos with Amazon Instant Video
  • Borrow books from the Kindle Owners’ Lending Library.
  •  Unlimited, ad-free access to hundreds of Prime Playlists and more than a million songs  on Prime Music
  •  Download a new book for free every month from the Kindle First picks
  • Access to Prime Pantry, allowing members to get  low priced grocery, household, and pet care items for a flat delivery fee of $5.99 for each

I’m glad I reviewed the benefits because I discovered even though we are saving just with the shipping and television benefits, we weren’t really using all that we could.

Thoughts on Amazon Prime

It looks like we’re going to stick with our Amazon Prime membership. I’m also going ahead and try out some of the other features including the Prime Music and the Kindle First download. Hopefully we can save some more money taking advantage of these.

Paper Profusion: 4 Tips to Reduce Your Financial Clutter

cut through financial money clutterAmericans go through about 69 million tons of paper every year, the Environmental Protection Agency reports. Books and magazines comprise a large percentage of this total, but the boxes of financial documents stashed in closets and filing cabinets across the country certainly don’t help. It’s good to keep records of your transactions and accounts, but in this age, there’s just no reason to go overboard. It not only increases your risk of identity theft, but it wastes paper and takes up space. We have four ideas to help you decrease your record-keeping clutter and get organized:

Lucky 3 and 7

The IRS has three years from the time a tax return is filed to audit it. If an egregious error is discovered, they may ask you to voluntarily extend this time frame. You are not required to oblige, but the agency would then use only the information it has available to determine any potential penalties, according to IRS.gov. Those who file everything without any book-cooking trickery can safely shred returns that are more than three years old. Records of large or unusual write-offs should be kept for seven years, just in case proof is ever requested.

Two Is Enough

The typical person only needs two bank accounts, usually a checking account at a national bank and a savings account at a local bank or credit union. But many people open accounts to get a gift card or some other incentive and simply forget about them. Take inventory of all your accounts by going through old check registers and rent or mortgage receipts. If you think you may have opened an account at a bank but no longer have the account number, send the bank a certified letter requesting verification. Include as much information as possible, so they can find the account if it exists. Close accounts you are not using and transfer any funds to your primary checking or savings account.

Use Financial Apps

Stop adding to your existing clutter by using a financial planning app. Three we like:

  • Koku consolidates your finances, tracks your spending and keeps virtual receipts of transactions you make with a credit or debit card. You can access it from your iPhone or Mac anytime, eliminating the need to keep receipts.
  • Mint.com is one of the first personal finance apps created, and it is still one of the best. It communicates with your bank to analyze spending habits and creates a budget for you. It also sends reminders when bills are due and keeps all your information secure with a four-digit PIN.

Organizing

You can get most financial records and other important documents in digital form now, but that can be just as hard to keep track of as files of paper. Using a cloud backup system can organize all of your files and maintain digital backups so you never lose them. Cloud services like Mozy can be used for business or personal solutions and will even sync to your phone or mobile device so you can access your files from anywhere.

With some documents, you need a paper copy or maybe just prefer it. The problem is finding the right paper when you need it. A document scanner is a great way to keep track of the documents, receipts and other paper records you keep. You can scan a copy to your computer, which is searchable for quick access. You can also cross reference to physical files so you know right where to look for the original copy. Some scanners can be pricey, but if you only have a few documents to scan there are mobile apps like TurboScan or ScannerPro that create digital copies directly from your phone.

Sacrifice Now or Sacrifice Later

If you ever read Dave Ramsey’s Total Money Makeover, then you’ve probably seen the phrase “If you will live like no one else, later you can live like no one else”. It’s printed on the bottom of the pages.

Looking at it, I can see how we’ve followed that advice quite well at times and we’ve ignored it at others. I think many people are in the same boat.

Lining Up Your Life with Your Goals

As our family has grown, we’ve adapted our finances to fit our goals. Sometimes that has meant sacrificing something now to reach a goal faster. For us that meant getting apartments which had rents that one of our incomes could afford. Of course we looked for safe apartments, I don’t think anyone should be cheap on safety.total-money-makeover

We drove old cars as our friends had new cars because we wanted to save money up to buy our next car with cash.

Have we done everything right and frugally? No and I’m not suggesting that everyone does. For example, we’ve gone on nice vacations (no debt though) while paying down the car loan. Could we have held up some vacations to speed up the debt snowball? Yes we could have. It’s a trade-off that we weighed.

It’s about finding a balance of making choices for now and for later. I think making some sacrifices is vital if you want to achieve your goals.

Real Life Example -> College Funds Vs Car Loans

This brings me to a subject that I’ve received comments and emails on that many couples with kids deal with. One of my popular posts have been about college funds for kids. It’s actually two parts, but for some reason, most people have ignored the first part where I discuss some of the financial realities of college funds for couples trying to tackle a lot of goals at once.

Parents are trying to get some savings up, paying down their debts, keeping up their monthly expenses, plus save up for kids’ college funds. However they email me or leave a comment that they don’t have the money. They beat themselves over because they can’t figure out where the money will come from.

When I ran the numbers on one of the college fund posts, I had used public four year degree estimates for calculating how much to save. It was about $28,000 (tuition, not including room and board). I had also made the comment that the average car loan being around $26,300.

If parents had decided that paying their kid’s tuition was their responsibility (and I feel that’s each couple’s choice), then maybe avoiding car loans can be a relatively easy way to free up money.

It doesn’t have to be the car, I’m just using an example, but honestly if you don’t think you can earn more money to pay for your financial goals, then you have to find something to cut back.

Thoughts on Balancing the Present and Future

I’d love to hear your thoughts about this idea of finding a balance between now and later. What sacrifices have you made to improve your finances now?

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How to Rebuild your Credit after Divorce

Divorce wreaks havoc on both emotions and finances, but you are not alone. The Centers for Disease Control and Prevention reports in a population of 1,000 people, 36 of the marriages will fail. Your financial troubles may or may not be your ex’s fault, but they are your problem once the divorce is final. The key to rebuilding that part of your life is creating new credit alliances that have nothing to do with your former spouse. Consider some ways you can rebuild your credit if divorce demolishes it:

Lay out some ground rulesW

Create rules that put you in charge of your personal credit. Start by settling what you can as part of the divorce agreement.

  • Close out checking accounts
  • Pay off loans and credit cards from the marriage

Ideally, the divorce proceeding will divide everything up, so there are no more shared credit issues. If there are, take charge of what remains such as mortgage. Finance site Bankrate.com points out that home lenders consider you married, whether divorced or not. The best solution is to refinance the home and pay off your spouse or sell the property. If you choose to keep the house in both names, take responsibility for making the mortgage payments and ask your spouse to pay you directly to avoid late charges that affect your credit score.

A little about credit cards

Closing low-balance credit card accounts obtained during your marriage may initially cause your credit score to drop, according to FICO, especially if the debt remains the same. For example, if you owe nothing on three cards and close them, you have fewer cards but the same amount of debt. Keep unused accounts open, but ask to have them put in your name.

If the debt on a joint account is solely your spouse’s responsibility, make taking your name off the account part of the divorce agreement. Ask lenders to freeze credit accounts with balances to keep either party from using them until they can be paid off and closed.

Go old-school to prevent identity theft

Revert to your maiden name after the divorce. This creates a timeline for separating credit issues and allows you to establish your own post-marriage identity. Making this change protects you from spousal sabotage if things should get ugly. Change all your personal accounts (or open new ones) to that name, as well. Make sure to adjust your passwords on everything from your computer network to your ATM to protect your new identity. Hiring a credit monitoring service such as Lifelock will alert you to any changes, too and protect your identity.

Get Copies of your Credit Report

The Federal Trade Commission notes you are entitled to a free copy of your credit report every twelve months from AnnualCreditReport.com. Credit reporting agencies are not going to remove accurate information, whether it was your spouse’s fault or not. You can ask, however, for an investigation into anything posted after the divorce or anything that seems improper.

Go through the reports and identify joint debts prior to the signing the agreement to resolve them. Make sure all debts your spouse is responsible for are in just the one name, too. Analyzing your credit score once a year gives you perspective as you work to improve it and move forward with your new life.