Browsing Category: Saving Tips

Avoid Using Payday Loans

payday loan alternatives

I’ve seen more payday loan advertised on the television and online and thought it would a good opportunity to discuss alternatives to payday loans and how you can build savings for future emergencies.

I think in this economy more and more people are realizing that they need to watch their budget closely. For some families they are working hard to keep their spending under their income. They’re surviving paycheck to paycheck. A portion of them are able to save just a bit after paying all of their expenses, but suddenly an emergency expense comes up and throws their delicate finances in for a loop.

Payday Loan Alternatives

They don’t want to ask their friends for a loan and they have no money in their credit card to use as a quick fix. Payday loans become a real option to people at such times. However, you may not have considered some cheaper options available to you already.

payday loan alternatives
Avoid payday loans if possible.

Tap into Your Local Credit Union or Bank

You may surprised to learn that some credit unions and local banks off small loans to members and customers. For example, here in North Carolina, the State Employees’ Credit Union offers a salary advance loan. As the name suggests, if an emergency comes up and you need a loan (up to $500) to tide you over until your next paycheck you can use it. It’s a lower rate than many payday loans out there. More importantly it’s part of a system designed to keep you away from the cycle of debt and into savings.

I did check around and other local banks offer something similar. They may call it a personal loan and the amount is usually capped around $1,000 or less.

Ask for Payments

You may not believe this, but sometimes you can work out a payment plan with some business owners. My mother’s car need some repairs and it was more what she had saved. Since the mechanic shop was locally owed, he was willing to work with her on a payment plan of 1/2 up front, 1/2 when she got paid again.

Don’t think this was a special instance, with some owners getting less foot traffic, they may be more willing to work with you. You don’t lose anything by asking and you may get an option that helps you avoid debt.

Craigslist/Yard Sale

It can be hard to find extra money, but if you have a lot of stuff at your place, you may want to sell it to get some of the money you spent back.

Where can you sell your stuff? Have you tried considered these places?

  • Yard Sale
  • Pawn Shop
  • Craigslist
  • Ebay (and other auction sites)

Sell where you feel most comfortable. Some people prefer working with someone face to face and while others just want it sold online. If you’re looking at selling your stuff online, but you don’t know where to start I suggest using Baker’s guide on selling your junk. The guy is a master – his family sold their junk and spent some time exploring the Pacific.

How to Create a Doable Emergency Fund

Having a financial cushion is a goal of many families as they are building their finances.

If you’re looking for something more tailored to your family’s needs, then there are several factors to consider when determining your emergency fund.

  • Family Size – If you’re a dual income couple with no kids or other family obligations, then you’ll probably won’t need as a big of en emergency fund as a family of 5.
  • Family Expenses – Your family’s lifestyle has a big effect on the size of your emergency fund. If you have high monthly expenses, then logically, you’ll need more money to save. If your expenses are due to unnecessary spending, then you may want to discuss ways you can lower it. If it’s due to circumstances (i.e. medical bills), you’ll have less room to work with. It’s still possible though to explore options to lower your bills.
  • Income Streams – If you have 2 or more income streams coming in, that can decrease the size of your emergency fund. You should still have one though, as unexpected events can happen.

If you’re still stumped than shoot for 3 months worth of expenses.

Where Should You Save Your Money?

The next decision you two should make is where you need to deposit your money. With an emergency fund you need to focus on 3 things:

  • Easy access to it in case of emergency – It does you no good to have a high interest rate if you can’t get to it quickly when it’s most needed.
  • Safe place to store you money – Whatever you choose, make sure it’s either covered by the FDIC (banks) or NCUA (credit unions).
  • A place where it can grow – If you can earn a decent interest rate for your savings while meeting the two previous criteria, then go for it.

If you follow these guidelines, you’ll have a better chance reaching your financial goals.

Thoughts on Avoiding Payday Loans

Have you ever had to use a payday loan?

Photo Credit: rinkjustice

Summer Saving Tips

summer travel

You may notice your wallet begin to sweat a bit as the summer heats up.  That comfortable air conditioning runs up the electricity bill, and gas prices, typically higher in the summer, make that family vacation more expensive than expected.  With a little planning though, the frugal consumer can actually take advantage of the summer months and save money while enjoying the season.

Energy Saving Tips

summer travel

Unless you live in the Arctic, your air conditioning is likely running non-stop throughout the summer.  The cold air might feel great, but your electrical bill will be burning.  No one is suggesting that you swelter all summer long, but consider taking advantage of cool and breezy nights.  Turn your air conditioning off after the sun sets and open some windows.  The cool summer breeze can be quite enjoyable after dinner!

While we’re talking about air conditioning, it’s important to make sure your system is functioning as well as it should.  According to the Environmental Protection Agency, you should change your home’s air filter at least once every three months.  A dirty filter wastes energy, putting a dent in your wallet.  That dirty filter can even be hazardous to your health; the buildup of dirt and dust can aggravate allergies. electrical bill will be burning.  No one is suggesting that you swelter all summer long, but consider taking advantage of cool and breezy nights.  Turn your air conditioning off after the sun sets and open some windows.  The cool summer breeze can be quite enjoyable after dinner!

Although it may seem a little rustic, the summer heat can allow you to quickly dry your laundry outdoors.  Putting up that old clothesline can save you a chunk of money while that energy-loving dryer sits idle.

Everyone loves a Memorial Day barbeque!  Why not enjoy the beautiful summer weather and make it a weekly staple?  Weekend barbecues are not only fun and inexpensive family activities; they’re a great way to save on energy cost.  In addition to sucking up a good bit of electricity, using a stove also traps a lot of heat in your home – heat which makes your air conditioning work harder.  So get outside and enjoy summer evenings while saving money!

Saving Money on Summer Road Trips

According to the EPA, gas prices typically begin to rise after Memorial Day.  Don’t let higher gas prices hinder your summer road trip.  Instead, take steps to improve your gas mileage which will offset the higher cost of fuel.

  • Make sure you tire pressure is correct.  Poor tire pressure reduces gas mileage.
  • Use cruise control on the highway.  Constant acceleration and deceleration uses more gas.
  • Avoid rough roads; driving on gravel can reduce your gas mileage significantly.
  • Don’t speed.  Although you might get there faster, the increased wind resistance at higher speeds robs you of fuel efficiency.

Don’t let bills ruin the season.  You can save money while having a great summer by following these tips.

This guest post was written was Stuart Lieberman from A New Horizon Credit Counseling Services Inc. A New Horizon is a national, Non-profit credit counseling organization dedicated to providing counseling services and financial education programs to individuals and families.

Photo Credit: Dene’ Miles

Gaining Insights from Phillip at Weakonomics

One of my goals for My Financial Reviews is to highlight personal finance blogs and sites that I think can help you with your finances. I was fortunate enough to have Phillip from Weakonomics answer a few of my questions on this new project.

What’s your end game goal with your Weakonomics website? weakonomics

Having an end game for Weakonomics would require me to have a goal for it.  Whatever happens will happen.  I’m not opposed to selling it, or I could get too busy and stop writing, or I could make enough money to write full-time.  Weakonomics has the potential to be a financial brand, so the possibilities are endless.

Who is your target audience when you’re writing on your blog?

I’m not after the personal finance newbie.  There are already hundreds of blogs and thousands of resources for those people.  I’m more interested in educating people who aren’t in the “fixing mode” of their financial life.  You don’t have to worry about that next credit card payment, and so you’d rather focus your energy on learning more about the finance side of personal finance.  This is of course a reflection of my own life.  Bloggers that focus on getting out of debt or finding the right portfolio balance are going through those things themselves.  I’m debt free and majored in finance, so at this point in my life those topics are boring.

How long have you been blogging?

I wrote my first posts in late 2007 when I was bored at my current job.  Weblogs Inc was looking for freelancers so I pitched an idea for either a
website or column called “Weakonomics.”  They weren’t interested (and plus my writing was crap).  I sat on the idea for a month or two, then decided to register because I loved the word I’d created.  The blog was up and running sometime around March of 2008.

 What’s your blogging schedule?

Like most brilliant minds, I have an erratic schedule.  My day job comes in cycles of high volume work and down time.  When I have spare time at work I do jot down ideas in an email and send it to myself.  Sometimes I will write on my lunch break as well.  For the most part I put the posts together at night.  I try not to spend more than an hour on my blog every day, but I must admit I do go over.

 Do you batch write your posts or do you work more on the fly?

I can’t batch write.  The closest thing to batch writing is when I make a really long post and decide to break it up into smaller ones.  What normally happens is I start writing something and it leads to another idea.  Before I’m done I’ve got four posts with opening sentences on different subjects.  Over time I’ll finish them one by one.

As a blogger, what do you do that gives you the biggest bang for your   buck in bringing in traffic?

The biggest bang for my buck has been with search traffic.  I write on good topics that entertain my regular readers, but it’s when I answer a question everyone is asking that I get the search traffic.  So when people were pulling money out of investments everyone was asking whether they should too.  I wrote a post on it.  When health care costs were a big debate in the election I wrote posts on the pros and cons of universal health care.  It’s answering questions that everyone asks that stand for as much as 50% of my daily traffic.

What’s your most popular post? Why do you think it has become a hit on   your site?
By far my most popular post has been “The Cons of Universal Health Care“.   It’s over a year old and still gives me search traffic.  I’m working on a follow-up to it, but I keep getting distracted with making lists.  I love reading lists and making them for Weakonomics.  To date my best one is “Six Lessons Star Wars Can Teach Us About Money” .  It looks like a recent post but it’s really just a republishing of the same list I made last fall.  The Star Wars community and Personal Finance community alike love it.

Do you ever see yourself being a full time blogger?

That isn’t my desire.  Blogging doesn’t offer the challenges that finance offers.  I’m on a career path that could really put me in a place to solve some serious puzzles.  For that matter unless I’m able to start cranking out NY Times bestsellers once a year I’d do much better in the income department continuing to work in finance.

But I also know that simply because I feel this way today doesn’t mean I will tomorrow. I want to have a family, spend hours every day with my future wife, and bring my dog to work.  I could do this as a writer full-time, and the only way to do this in finance would be if I started my own company and put the Sheconomist to work on making sure my lack of common sense doesn’t destroy the company.

Thanks again to Philip for a wonderful interview! Please subscribe to Weakonomics and chat with Phillip on Twitter.