Debt Free Life Hacks: Managing Money Like a Boss

You've heard it a million times: "You need an emergency fund." It's one of those personal finance basics that everyone talks about, right up there with "spend less than you earn" and "start saving early." But here's the question nobody seems to answer clearly: How much is actually enough? The standard advice is 3-6 months of expenses. But that's a pretty wide range, and your life doesn't fit neatly into a formula. So let's break down what really matters. The 3-6 Month Rule (And Why It's Not One-Size-Fits-All) The 3-month camp: If you're in a dual-income household where both people work stable jobs, three months might be sufficient. The thinking is that if one person loses their job, the other income keeps things afloat while you figure out the next move. The 6-month camp: If you're single, the sole earner in your household, or your income is less predictable, aim for six months. You don't have a backup income,...

Did you know that the government incentivizes taxpayers for certain things? It's true. Take, for example, the Retirement Savings Contribution Credit, commonly referred to as the Saver's Credit. This is a tax credit for taxpayers who invest in their future by saving for retirement. It helps reduce your taxes while at the same time helping you and incentivizing you to save for retirement. How much is the credit? The credit is up to $1000 (up to $2000, if Married Filing Jointly). While this may not seem like very much, every little bit helps, especially when reducing tax liability.  How does it work?  Based on your Adjusted Gross Income (AGI) and your filing status for taxes, you can receive a credit of 10%, 20%, or 50% of eligible contributions to a 401(k) or to an individual retirement account (IRA). This is a non-refundable credit that will help reduce the amount of taxes due but cannot be more than the amount of taxes owed.  Who qualifies for the credit? Individu...

A year ago, I decided that as a birthday gift for myself, I would get a one year certificate of deposit. After doing a little research, I found one that offered a 2% interest rate for a minimum deposit of $2,000. Well, I definitely wasn't going to make a fortune with this rate, however, I knew for one year I'd have $2,000 put away that couldn't be touched ( without a penalty ) and it would grow a little during that period. Since penalties are a no-no, I moved forward, confident I would not touch that money for a year. What is a Certificate of Deposit (CD)? A certificate of deposit is defined as "a certificate issued by a bank to a person depositing money for a specified length of time." The money earns an interest rate premium in exchange for investing for that set period of time. Should I get a CD? Perhaps you have a little extra money sitting aside and you are trying to figure out what to do with it. If all your bills are paid, your emergency fund is fully funde...

Many car insurance companies are providing a discount for policyholders due to the COVID-19 pandemic. Discounts or reductions vary by the company as well as how the credit is applied or will be applied. You may have received a letter or email with the details and there may not be any action required on your part as it will likely apply automatically.  Take advantage of this opportunity to either pay your policy in full or in fewer payments. This will help save you even more money! Find out what your insurance company is offering or has offered in response to COVID-19. Below are links to details for some of the major providers. If your insurance company is not listed, just do a quick search online for your company and COVID-19. Allstate Insurance GEICO Insurance Nationwide Insurance Progressive Insurance State Farm Insurance

Right now during the COVID-19 pandemic, people are spending a lot of time at home. While I'm sure there is plenty that can be done while home,  sometimes boredom sets in. When this happens, some people tend to do a lot of extra snacking, others do a lot of extra spending.  Snap out of it! The time spent at home is a great opportunity to put your money on a diet. An opportunity to slow the spending, to focus on saving and investing. Instead of wastefully spending money online ( which only lowers your net worth ) focus on finding ways to increase your bottom line.  Potential Saving Opportunities as a Result of Being Home Savings on Gas With many people now working from home, or temporarily home, you're likely to do less driving which means less money spent on gas. For essential workers, gas prices are low right now so there are still some savings, as a result.  More time at home If you're an on-the-go type of person, being home for so long can be...

It’s tax season and for different people, this means different things. For some, tax payments are due😞. For others, a tax refund is owed😊. Hopefully, you’re in that second group. If you are, you are in luck! Proceed with caution though,  it is important to have a plan for the money so that you do not squander it all. The same holds true if you were to receive a stimulus check ; proceed with caution. Recently, I was watching an episode of Shameless. Upon receiving a tax refund check, one of the characters was immediately tempted to spend the money. He felt like it needed to be spent and needed to be spent immediately. Unfortunately, his ideas were to spend the money on wasteful things like the lottery, casino, etc. This is a prime example of what not to do.🤑 There are many ways that you may choose to spend any extra income, and of course, you know your situation best. Below are some ideas to get you started. 10 Ideas on what to do with a tax refund or stimulus check: ...

Budgeting and saving can be challenging at times, but here are some tips to get you started! Create a budget - you telling your money what to do.  Stick to the budget - really use it to limit extraneous spending. Watch out for wasteful spending . Do you need that? Put it back! Try to go a week without making extra purchases - During a typical week, I'm back and forth to work. I rarely spend any money during the week.  Bring your lunch and snacks to work -  limit going out to eat and trips to the vending machine.  Buy Groceries - While you may be spending money on groceries, grocery shopping can amount to big savings. This typically means that you're cooking and eating at home which usually is less than money you would spend in restaurants.  Stay home some weekends -  If you're anything like me, a day out usually means spending money. Picking up items here and there, going out to eat, throw in a movie and drinks and there goes your money! Find fre...

This year, I'm trying a new savings strategy. I'm still doing the 52-Week Money Challenge but also trying another that I saw online. Saving Strategy - Multiply the Month by Number of Days It is quite simple. You take the month number times the number of days in the month and that is the amount you save. For Example: January is the first month (1) and has 31 days. 1* 31= 31 so you save $31. February is the second month (2) and there are 29 day this year. 2*29=58 so you save $58.  This pattern continues through December. It's just that simple! A little savings every month and by the end of the year you have an extra $2,382.  The strategy may not work for everyone, but find one that works and stick to it. This year your challenge is to make saving a priority! 

The end of the year is near! It's a great time to make final contributions, finish up challenges, and reflect on your money journey. Did you save as much as you wanted to save? Did you spend more than intended? What challenges did you face? What unexpected expenses threw you off track? Were you able to get back on track? Did you pay off one or more debts? What stands out? As we plan and set goals, we must be reasonable and flexible. Life happens, that's just a fact. Recognizing what went well and what did not allows us to plan for the future. If this year car troubles hit the budget hard, it may be time to budget more for future repairs and maintenance or even create a savings plan for a new car. As mentioned in a previous post, I took part in the 52-Week Money Challenge for the second year in a row. I've made my final payment and have successfully reached this year's goal. It's so rewarding to set a goal, work towards reaching that goal, and finally reach...

As I mentioned in a recent post, last week I started Financial Peace University (FPU). Ever heard of Dave Ramsey? He is the creator of FPU. FPU is a course that teaches participants how to budget, how to pay off debts, how to save and give.  While not in debt, I knew the program still had lots to offer and that I could only benefit from participating.  The course follows 7 "Baby Steps". While familiar with the program and the baby steps from the books and podcast, I still learned some new things. One thing was that no matter what your financial situation there is always room for growth and room for improvement. I've become even more determined to build wealth and do what is necessary to protect said wealth, once accumulated (when, not if 😁). I went home immediately trying to think of ways to grow my emergency fund (Baby Step 3) and then focus on Baby Step 3b, which is to save 20% for the down payment of a new home. Another thing that I was introduced to wa...

Do you live to work or are you working to LIVE ? Are you living or just existing?  I work to live. I enjoy work and my contribution to society and the world, but work is not all there is to life. Life is for living and it is important to live life to the fullest.  Few of us are fortunate enough to have the option of not working. Work is just a part of life, but I argue that work should not be life. While a job pays the bills, there truly must be a balance.  If the budget is tight or money management is not great, one can get into the "I need my job " mindset.  This is a dangerous mindset because everything you do becomes about the job and survival. Individuals begin to put work first at the detriment of themselves, their health, their families, their relationships and more. While I am grateful for every job I've held and while the income earned allows me to provide for myself, not once have I ever felt tied down by any job.  The point I'm making is that ...

I'm sure we've touched on this in other posts, but this week I want to talk about the importance of having an emergency fund. Trying to save money when you're drowning in debt is unlikely, but once you can start putting money away, you want to make that a priority. Show me what you're working with. Are you living within your means?  First review your expenses. Do you know what your total expenses are each month?  Next, calculate your net income. How much are you bringing home?  Now, do the math. Subtract your expenses from your income. Do you have a positive or negative balance?  If you have a negative balance, it's important to carefully examine your expenses.  If you have a positive balance, that's great. There still may be room for improvement, but you're definitely on the right track.  Track your spending for a few months. This will help you get a clear picture of what's going out to what is coming in. Create a budget - Once you ...

I was chatting with a colleague during our afternoon walk and we discussed her AC needing to be repaired and the possibility of it needing to be replaced at some point in the future. Her hope was that it would be years down the line before it would need replacing stating she did not have $5,000 to replace the entire system. My recommendation? Start preparing now. Do some research, price the parts and labor and then start saving specifically for that expense. Do it before you need it so that when it does go out completely you won't have to go long without air, scrape to find the money, borrow the money, or add it to a credit card that's already close to being maxed out.  Even if she doesn't have the full amount saved by the time it goes out, something is surely better than nothing.  This method can work for just about anything. You begin with the end in mind ( a strategy for course design that happens to work in other instances ). Decide what you want, how much it cos...

Are you missing out? This week I talk about Employee Benefits. Check out the short video below!

I write about saving often because it really is important. As important, is finding the saving strategy that works for you. Everyone is different and what works for one, definitely will not work for all. The idea is to find what works for you best so that you're setting yourself up for success. I have been a big saver for as long as I can remember. There was never a time in my youth or adulthood where I wanted to spend every dime I had to my name. It's just something I never fathomed. Maybe it was fear of not having or just the comfort of having. I'm not talking huge sums of money, but from a young age, I realized the importance of not spending it all. I'd save change that someone had given me or money earned from being rewarded for a good report card. When I finally started working (McDonald's - Age 16, minimum wage) I tended to save most of each check. The amount I allocated for myself was easily less than 25% of what I brought home. In numbers, a $130 check m...

If I knew then what I know now. My mom is a bargain shopper, so quite naturally I became one, but that was not always the case. As a child, my performance in the thrift stores was award-worthy. It was soooo below me, I would complain about the smell and to me the thrift store was "the itchy store". It made my skin itch, I couldn't breathe. Call it an exaggeration, but little ole me was suffering.  Fast forward many years later. That little girl grew older and wiser. I learned that thrift stores are often filled with hidden treasures. It no longer makes me itch and the smell isn't as bad as I made it. Maybe I'm just too excited by all the potential deals and savings that I just don't notice anymore.😆Not only can you find gently used items, you often can find brand new items but without the brand new price tags.  JACKPOT! For me, the rebirth of the thrift store took place when I discovered I could find board games for the low. Being that I hosted a ...

Small amounts can add up over time.  It's easy to overlook the small ways that you can protect your finances. Here are a few tips that can help you save money that may otherwise be wasted on fees.  Bank Accounts - Find a bank account that doesn't charge fees or find an account where you can meet the minimum requirements to have the monthly fee waived. Monthly fees vary, however, they can easily add up. Instead of paying the bank, that money could be added to your savings/rainy day fund.  Car Insurance - If possible, it's ideal to pay your full car insurance premium in full. Why? Typically, when you pay monthly (or other split methods) there is usually an extra fee charged to each payment. Many people do not pay attention or notice it, but it's there. Those fees go away when you pay in full and sometimes even with a discount.  Auto Pay Discount - Some cell phone companies (and others) offer a small discount when you sign up for auto pay. You no longer have t...

YOLO (You Only Live Once) We've all heard this phrase, and it definitely holds true. Another is "Life is short". Also, but only sometimes true. While we know that we only have one life to live and tomorrow is not promised, we cannot spend every dime we have to our name today because if we are fortunate enough to see tomorrow we still must be able to "live". This is not meant to be a dark topic, but in life, we must make complicated financial decisions. Because YOLO, you may want to enjoy life to the fullest, and that you should. This, however, is not an excuse to be irresponsible. Enjoying life to the fullest does not mean blowing all of your money on fun and entertainment. Yes, you can have a social life.  Yes, you can go on vacation.  Yes, you can treat yourself. Before you do all these things, just make sure you have some sort of plan in place. Create a budget for the major categories in your life. How much do you want to spend on fun and entert...

Did you know? Did you know that in some situations the best time to shop is before you even need a product? These items include toiletries, paper products, drug items, canned goods, etc. You actually have more buying power when you buy your items in advance. Why? You ask. The reasons: You have more flexibility more options you can shop around you can take advantage of sales and you can also make use of coupons. What's wrong with buying items only when you need them? The truth of the matter is, everyone cannot afford to buy in bulk but the real truth is you cannot afford not to. The initial investment may seem greater but when you exercise your options you can do so much better than when buying things when you need them. Think about convenience stores, most of the time there is a huge markup on items; do you know why? Because they can, you pay for the convenience. If you just went in the bathroom and realized you are down to your last roll of tissue and you have a ...

The Potential Curse Ever been tempted to purchase an item because they promise 18 months same as cash? Or perhaps you're shopping at your favorite department store and the cashier asks "would you like to apply for a credit card and save 25% percent on your purchase today?". Desperately in need of a new car, have you walked into the dealership focused solely on getting the monthly payment you can afford? Warning!! Proceed with caution.  What sounds like a great way to SAVE money could actually COST you in the long run. The truth is any of these situations can work in your favor or have a totally opposite effect. What comes into play is interest rates. Bankrate.com defines an interest rate as: the proportion of an amount loaned which a lender charges as interest to the borrower, normally expressed as an annual percentage. It is the rate a bank or other lender charges to borrow its money, or the rate a bank pays its savers for keeping money in an account. Why d...