The End of the World?!

Well, December 21, 2012 is looming around the corner. Are you feeling a bit unsettled? Is R.E.M.’s song, “It’s the End of the World as We Know It” constantly running through your head? Or are you blissfully unaware of the countless theories purporting that this day will be the last the earth sees?

Whether you’re sitting back, having a good laugh at all the nut jobs, or feverishly stocking Twinkies in your bomb shelter, it is a very wise idea to be financially prepared for any emergency. Some may be more difficult
to prepare for, e.g., the earth getting sucked into a black hole. However, there are some steps everyone can and should take to be ready for a “less cosmic” emergency.

Some general tips:

• Have some cold, hard cash on hand. The whole economic structure may not crumble, but all it would take is a massive power outage for your little plastic card to become quite useless. It’s unfortunately not even edible. Experts have differing opinions, but consider having enough cash to cover one month’s expenses, or at least $200-$500. You probably don’t need to be reminded that hard cash can literally burn or be stolen, so keep an appropriate balance that allows you to sleep at night.
• Have an emergency savings. This is extremely important for even non-apocalyptic living. Having at least some amount put away will help buffer you against job loss,deductibles, major repairs, unexpected taxes, solar flares, ANYTHING that might creep up on you. Experts again differ here, but consider working towards 3 to 6 to 12 months of living expenses. Where should you put it? More differing opinions, but check out savings accounts, money market accounts, certificates of deposit, online savings, etc. The key here is that the money is liquid enough for you to access it when you need it.
• Write down or video tape all your major belongings. It will be a lot easier to prove to insurance companies that you did indeed own a 42” flat screen if you have video of it.
• Have enough insurance. Not that it was intended to scare you silly when you were in elementary school, but the Wasatch front is indeed overdue for an earthquake. Don’t lie awake thinking about it, but definitely get earthquake insurance. It may be cheaper than you think. It’s also a good idea to evaluate your other insurances once a year, if not more: health, life, disability, homeowner, auto. Make sure you and family would be protected in the worst case scenario.
• Have a plan. Make sure your family knows where to go, where the food storage is, where the emergency supplies are, etc.

It’s easy to get a little bogged down in all the emergency preparedness talk. It can also seem overwhelming to get everything you need in place. Just remember that steadily working towards your preparedness goals will put you in a much better position than never having started. And no worries; hopefully/probably we’ll all be sitting back, sipping hot cocoa on December 22nd.

America Saves: Credit History and Saving

April was Financial Literacy month and America Saves wants to make sure you understand the importance of your credit history and how this ties into successful saving. It is important for all Americans to have savings. Having a savings account allows you to pay for emergencies, gives you financial freedom, and can help you avoid credit problems that could hurt credit scores.

Having a strong credit history, reflected in good credit scores, allows you to qualify for lower interest rates and fees. This helps you to free up additional money to set aside for emergencies, retirement, and other smaller unexpected expenses.

The connection between successful savings and good credit plays an important role in your financial life. Not only is it essential for obvious things like qualifying for a loan or getting a credit card, but also for less obvious things like getting cellular telephone service, renting a car, and perhaps even getting a job.

Want to learn more about the importance of credit history and successful savings? 

Download the Importance of Credit History and Successful Savings packet (http://americasaves.org/images/newsletters/creditscore.pdf) which includes information on: 

• What is a Credit Report and Score?
• Why is Saving So Important?
• How do I Start Saving?
• What Savings Options Are Available to Me?
• Why is Good Credit Management so Important? 
• 5 Tips for Building Good Credit.
• Frequently Asked Credit Questions.
• FDIC Model Safe Accounts.

What are you waiting for?

Set a Goal.

Pay down debt, save automatically, and assess and improve your credit history. Go to www.annualcreditreport.com

Make a Plan.

Improve your credit history by making the minimum payment on all bills, keeping balances low on sources of credit, and applying for credit wisely.

Save Automatically.

In order to have good credit scores you must demonstrate a habit of good credit management over a long period of time. Set up direct deposit or put part of your check into a savings account automatically each month to pay down debt and ensure you have enough money for emergencies.

Are you ready to take charge of your financial future?

America Saves is here to help. America Saves can help you develop your goals and take action. When you join as a saver, you’ll receive the following benefits:

• Free subscription to the quarterly American Saver newsletter
• Free monthly e-mail newsletters with savings advice from national experts
• Free access to the members-only Savers Tracking Tool to help you reach your goals

{This month’s post was brought to you by guest author Katie Bryan, America Saves Communications Manager}

Extinguish that fire, and save!

Let’s say you need to wash the dog, call your dad back, do your taxes, and take care of the fire that’s rapidly consuming your kitchen. It’s time to make a priority list! Let’s say you performed these tasks in the order they’re listed. By the time you tackle your taxes, there won’t be a house left to get those mortgage deductions.

The takeaway: prioritizing matters!

In this case, dousing the flames first is a no brainer. And here’s another no brainer: make savings a top priority! Now, of course there’s a caveat: if food and shelter are an issue, or emergencies pop up, your priorities will change. But in everyday life, as you’re crafting that superstupendous budget of yours, treat savings as if it were one of your most important bills. In a lot of ways, it is. Don’t go with the mindset, “Well, I’ll pay these important bills, get some needs, get some wants, and then if anything is left over, I’ll put it in savings.” That way of thinking isn’t going to get you an early retirement. You need to pay yourself first to get ahead!

You know your situation best, so make a plan, and write down some goals. Say you’d like to put $100 away per month. Instead of hoping it’s there on the 31st, put that money directly into your savings right along with your mortgage, utilities, and groceries. Make it a priority, and it’s far more likely to happen. All your other expenses tend to find a way to fit.

Say you’re loving this plan, you’re getting excited and want to save, but maybe you don’t trust yourself to actually part with your funds each month. One of the most effective ways to save is to have it taken out automatically. Just call up your bank or credit union, and ask to have whatever amount you’d like moved from account to account. So let’s say Steve is bringing in $2000 per month, and wants $200 automatically moved from checking to savings. Since Steve has quite the imagination, he decides to play a little game with himself. He pretends that he’s only making $1,800 per month. So sad. He got a pay cut at work for telling his boss how he really feels about TPS reports. He’ll have to tighten his belt and make a few adjustments. A year later, Steve takes a peak at his savings account, and BAM! He’s got $2,400 big ones sittin’ in his account! (Not to mention any interest he may have earned.)

Steve knows that to get ahead, he needs to pay himself first. He’s also the kind of guy who puts out the kitchen fire before washing the dog. Like Steve, once you get in the habit, it’s really not too difficult to save. Start small and work your way up. Even $10 per month is INCREDIBLY better than no dollars per month. Keep in mind that the habit is far more important than the amount!

Crazy, Hair-Brained Ways to Save a Few Bucks

We frugal folks may always be mocked for our eccentric moneysaving techniques, but in the long-run, we’re the ones laughing. Oh true, flattening the toilet paper rolls to slow down excessive use may appear crazy, maybe even obsessive-compulsive, but labels of “cheap” and “insane” only fuel our fire to save. The point is: every penny really does count. When you add several “crazy” ways to save together, over time, you end up with much more than just pennies. Even if you’re one of the mockers, come on over to the winning team—we could all stand to shave off at least a bit of our expenses.

Below is a list of just a few ideas. Not all will work for you—you may widen your eyes and think, “Wow, now that’s truly crazy—who does that??” But pick a couple; give them a try. Even one buck saved could buy you a two Twix bars…and what lunatic would turn that down?

• Use less washer detergent. Your clothes will get just as clean with ¾ a cup, rather than a full cup.
• Buy generic brands. A lot of products are basically the exact same thing in a different wrapper. (Except for Macaroni and Cheese—go real or go home).
• Shop around for health and car insurance. Every once in a while, give your provider a call and see if there are any deals or adjustments that will save you money.
• Cut your spouse’s and children’s hair. You may want to practice this first…or they’ll never let you near them with a pair of scissors again...
• Turn down the heat in the winter and use more quilts and sweaters. Pretend it’s 1850, if that will make it more interesting for you.
• Check your car’s tire pressure and have the oil changed regularly. This saves gas and protects your car from other costly problems.
• Take shorter, cooler showers. 
• Pay more than the minimum on your credit cards. Paying off balances can save you hundreds in interest.
• Give your internet and cable provider a call and ask if they have any deals for you since you’ve been such an awesome customer. Be persistent. They can usually do something for you. While you’re at it, downgrade something like internet speed or cable packages. Do you really watch all 250 channels?
• If you watch a lot of movies, RedBox or Netflix may be a cheaper alternative to renting or going to the theatre. The public library also rents movies for free—popular ones! There are more than just documentaries.
• Use coupons. But only if you really need the item. If you found a coupon for pet rocks, you’re not actually saving money when you buy it… Check out pinchingyourpennies.com or gurusdeals.com for couponing ideas.
• As it’s no longer 1998, do you still need your landline? Can your family get by with just cellphones?
• Check out craigslist.org, ksl classifieds, or eBay instead of buying stuff brand new.
• Lose the gym membership. Run outside, or check out some of the websites that offer free workout videos.
• Keep your fridge stocked with (ideally healthy) food, so it won’t be as tempting to go out to eat.

The list of ways to save money is virtually endless. Go on and get creative. Give it a try—bargains can be exhilarating and satisfying not only for budget nerds. And remember, when it comes to saving money, there is no such thing as too crazy—a dollar is a dollar, after all.

More Exciting Than a New Transmission...

Do you get a rush of adrenaline when you purchase gasoline? Can you barely suppress giggles of joy when your mechanic hands you the bill for a new transmission? Do you think an oil change is more exciting than puppies, fireworks, and Christmas combined? If you answered no to any of these questions, applaud yourself for sanity, and sit tight—there are some simple ways you can make car ownership a far more enjoyable experience.

The first way is easy—walk whenever possible; or run, if you’re late. You’ll feel better about that doughnut you had for lunch, help the environment, and avoid mileage on your car all in one go! Another option is public transit. Cache Valley has an award-winning bus system that is free of charge. Anyone near USU’s campus also has access to the Aggie Shuttle. Let’s face it, parking is a nightmare and booters are lurking around every dark corner. Why not avoid the hassle?

Next up, make sure your tires are inflated properly. Many gas stations offer free air, and a tire inflated to the right PSI actually gets better gas mileage. Better mileage means less money at the pump.

Although it feels good to pass that truck, excessive acceleration guzzles your gas faster. If you’re fancy enough to have a car with cruise control, flip that puppy on and be content not to "win" the race to your destination. Each car has a different optimal speed, but generally, anything over 60 mph starts reducing your miles per gallon.

Speaking of miles per gallon, another way to get more of them is to remove excess weight from your car. Kicking your passenger to the curb might be a bit harsh, but you may be lugging around all sorts of things you don’t need. Take out the fishing gear, the golf clubs, and the rock salt, and you’ll see your miles per gallon hike upward.

Have a car loan? Getting a tax return soon? By paying off your car loan early, you can save on the interest you would have paid to the bank. They’ll be just fine without your money. Just make sure there’s no prepayment penalty for early payments.

Lastly, just like you need regular doctor check-ups, so does your car. The poor thing spends every night out in the cold, takes you to work every day, and waits patiently while you grocery shop—the least you can do is give it some lovin’. Getting the oil changed regularly along with full-vehicle check-ups can catch problems before they explode in your face and save you money down the road.

So, as exhilarating as it may be to spend your bonus on a carbure-tor, there are plenty of ways to save on car expenses. Take a couple of these ideas and put that saved money toward something really exciting—like puppies, fireworks, and Christmas!