Category: Money Saving Tips

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Start A Summer Savings Account for Next Year’s Summer Vacation



Summer vacations can be the highlight of the year for many families and are a great way to spend quality time together. However, these trips can cost well over a thousand dollars and can be a strain on a family budget when no money has been put aside. The best way to avoid using credit cards unnecessarily or getting behind in everyday bills due to a summer vacation is to plan ahead. By starting a savings account now for next year’s summer vacation, families will be able enjoy their time together without worrying about financial repercussions.

Make Saving A Priority
It is all too easy for money that was meant to be set aside for a vacation to be spent on other things when it is put into a bank account that is also used for other expenses. Instead, start a separate account that is specifically for the family vacation. First decide on how much the family can afford or wants to spend on the next vacation and divide that number by the months remaining before the next vacation. This will give you the amount that needs to put aside each month to reach the goal. This should be treated just like any other expense or bill and be put away before any other extras are bought each month.

Finding Extra Money
If a family’s budget is already stretched tight, it may seem hard to find that extra $100 or more to put away. If this is the case, then one of two things must happen: spend less or make more money. You may find the monthly vacation amount right in your current budget by reducing grocery costs, cutting down luxury expenses or even taking the bus instead of driving. Another way to finance your vacation savings is to find ways to earn that extra amount by getting a second job or selling unneeded items via garage sales or on eBay.

By planning ahead, families can have a great summer vacation without it causing a huge strain on their bank account. The result is less stress and a more enjoyable vacation for everybody.

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Making Plans for Your Tax Refund?

There are so many things that you can do with a tax refund. It is not a lottery windfall, it is money that you worked hard for and you deserve to get the most out of it. It is understandable that you may want to spend it on lavish gifts for yourself and family. Alternatively, you can make your tax refund work for you, which will lead to much more financial security in the long term.

Reduce Debt
A tax refund can help you significantly reduce your debts. By paying off the debts that have the highest interest rate first, you are effectively adding to your monthly income. In the long run, paying off debts will save you more money than you received in your tax refund, too, so it is definitely an option for consideration.

Expand Your Portfolio
Look at your investment options, and see if your tax refund can help to expand your portfolio. You can also use your tax refund for future investments, which will help you to ensure a financially secure retirement. By investing your tax refunds in this way your portfolio is more likely to grow and generate more income for your future.

Pay Insurance Premiums
With so many different types of insurance to pay during a lifetime, most people find that their budget cannot stretch to the cover what they want. However, by saving your tax refund each year towards insurance, you can afford to protect your home, car and family should any unexpected issues arise.

Personal Reward
Finally, do make sure to reward yourself, too. Although it makes sense to invest the bulk of your tax refund, you should keep a little bit back for yourself. Reserve at least 10% of your tax refund to treat you and your family. Doing so will actually help you save and budget each month, as it won’t seem like you are saving every penny for a future that feels extremely far off.

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Spending in Your First Year of Retirement

Your first year of retirement is full of anticipation and excitement for what’s to come. You suddenly have more freedom than you have had in years, which means endless opportunities to spend time and money on the things that you love. There is a catch, though – how do you determine whether you are spending too much? Unfortunately, while most retirees are well versed on how to generate an income for their retirement years, they often have trouble working out when and how to spend it.

While it may seem like you have a huge amount of income stashed away, you still need to budget. It is difficult to accurately predict what you will spend before you actually enter retirement, as there are too many unknown variables yet to be discovered. Your first year presents the ideal opportunity to set the bar, so that you can live comfortable for the rest of your retirement.

A good starting point is to estimate your expenditure for each year. This will provide you with the basis for your initial budget. Once you enter retirement it is important to keep track of your spending, and then compare it to your projected budget. It is also important to recognize lavish spending habits as soon as possible. Review your spending every three months to evaluate whether you are on track.

You need to allow for unexpected costs, too. A particular concern for many retirees is sudden health problems. However, anything that could derail your budget needs to be given consideration. It is for this reason that financial advisors suggest formulating a number of budgets. By doing so you can funnel contingency funds to where they are needed, with minimum impact on future retirement years.

Once you are over your first year of retirement, review your budget again. If you were under target, consider whether it was due to careful spending or adequate assets. Conversely, if you overspent on your budget, look at how you used your income and think about re-evaluating your lifestyle.

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Ways to Downsize During Retirement


Downsizing during retirement, for many of us, isn’t so much of option as a necessity. Reasons for downsizing are not always financial, either; mobility and convenience also factor into the decision. Living within your means doesn’t have to be a struggle. In fact, being frugal with your money, time and energy will enhance your life during retirement. By working smart, there are a lot of cross over benefits from downsizing, too, so it is important to consider how every decision impacts on the rest of your lifestyle.

Home and Community

The size of home you live in and where it is located can determine how well you are set up financially for your retirement. Retirees can save around 25% on their
mortgage with a smaller property in a more affordable area, and greatly reduce tax and insurance payments, too. A smaller property also means less upkeep; saving precious time and energy for doing the things that you actually enjoy.

Transport

Although most retirees opt to keep their car, at the very least, do consider downsizing to a more cost efficient model. An area with reliable public transport or convenient facilities within walking distance is another option to reduce travel costs, for retirees who do decide to get rid of their car altogether.

Garage Sale

A garage or lawn sale will take care of a lot of unwanted possessions; including items such as paintings, small to medium furnishings and electronics. If you are selling a car, this is also a great way to draw attention from perspective buyers.

Donating

Donating to local charities or free recycling services is the quickest and most efficient way to de-clutter. Charities will take clothes, furniture and some electronics. A recycle service will take damaged furniture, clothes, electronics and other materials. Check with your local charities first, so that they can benefit from any items you can give them.

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Planning for Early Retirement


There is nothing quite as appealing in life as the prospect of retiring early. However, it is not a decision that you should make on a whim. Remember, while you will gain additional years in retirement, you will lose the income you would have generated in those years, had you continued to work. This leaves you with two choices; living on a smaller budget and making sacrifices in your lifestyle, or, finding other ways of generating an income that will allow you to have a long and happy retirement.

First of all you need to determine how your current income stacks up against your chosen retirement age. The earlier you retire the less time you have to save. With improvements in lifestyles and healthcare you should anticipate living into your nineties, which means more retirement years, too. So begin by calculating how much assets you will have per year, based on your current income.

If you really want to enjoy your early retirement, make the sacrifices while you are young. Take a second job to offset the income you will lose in your retirement years. You should also consider easing into your early retirement, by continuing part time work to support yourself. Many retirees start their own small business, drawing from life skills to do something that they enjoy and earn an income as well. Start planning your second career or business now, so that you are well prepared for your retirement.

Higher growth investments are a good strategy for generating retirement income, provided that you start early. Taking risks with equities can pay huge dividends if you allow yourself the time to recover from dips in the market. Potentially, you could end up making up your shortfall without having to work a single day longer than you want to. When you get closer to your retirement age, you can then move to more secure investments. Don’t leave it too late to get in on investments that will work for you, organize your retirement portfolio today.

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You and Your Money with Gail Vaz-Oxlade

Creditaid is pleased to announce that we are a proud sponsor of You and Your Money seminar series with Gail Vaz-Oxlade. Gail Vaz-Oxlade will be in Winnipeg, Thursday, February 9, 2012 at Canad Inns Polo Park.

Also, don’t miss this opportunity to hear some expert financial advice from a variety of seminars from 2 pm-5 pm. Creditaid will be holding seminars on budgeting at 2:00, 2:30, 4:00 and 4:30.

Tickets can be purchased at Sofias Boutique 836 St Mary’s Rd, Winnipeg, Phone Number: 254-2595.

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Consumer Obsession Leads Us to Over-spending

The desire to “keep up with the Jones’s” has become more than a social status issue for many people.  Also, it is very easy to get caught up in this during the holiday season. It has become a catalyst for overspending that has consumers running to banks and other lenders looking for ways to finance their purchases. This issue also has countless consumers loaded up with credit card debt so steep it may take them a lifetime to get out of it.

Give your financial literacy a good double-check, and if you are not already practicing the following financial practices, now is a great time to start today:

  • Pay bills on time and balance your check book each month. You can’t know how much you can afford to spend if you don’t know how much you currently have to spend.
  • Stop buying on impulse. If you want something, rather than charging it on your credit card and paying interest, save for the next few month and buy it when you have the money.
  • Always pay more than your minimum balance on credit cards: Get rid of them as soon as possible. You will save money on interest and have more to save for the future.
  • Vow to maintain only “good” debt. This is the type of debt that will increase your net worth: A mortgage on an affordable home, a car loan, or college debt. These will either increase your creditworthiness or make you more employable so you are able to earn more and keep debt to a minimum.
  • Always include some savings in your budget. Many short-sighted people are unable to see their needs after retirement and don’t save. This results in financial difficulty during their declining years.
  • Find out what you don’t know about finances—and learn it. Despite the flood of information on financial management, people don’t take the time to learn.

Finally, in order to put a stop to this financial madness keep in mind the media pull for spending and don’t be drawn into the hype. By being savvy shoppers and savers, the overspending and debt can stop.

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What’s Your Hobby Worth?

Everyone has his or her own private passion. It may be sports, photography, fishing, crafting or restoring old cars. These types of passions and hobbies can keep us energized and excited about life. That’s a good thing. On the flip side, some of them can become quite expensive, and when it involves something we truly enjoy, it is easy to justify those expenses to ourselves. A good deal is a good deal, right?

If you’ve gotten yourself into debt to finance one of your hobbies – you aren’t alone. Plenty of people find themselves in that situation. Sometimes people make the assumption that the hobby will be able to pay for itself in some way, and then, that doesn’t materialize. At other times, people just get caught in the heat of the moment and hope they’ll be able to pay off the credit card debt the next month or next spring or…

Debt that has been created because of overspending of hobbies and recreational activities can be dangerous to a family in more than one way. Besides the bind it puts you into financially, it is the type of debt that often can cause strong division in a marriage relationship as well, particularly if the interest  is not one that is shared by the spouse.

Hobby debt can accumulate much faster than we expect, but it doesn’t need to be your downfall. At Creditaid, we’ve helped plenty of people deal with this same situation. Our experienced credit counselors are here to help. Contact us for your free initial consultation.

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Credit Card Offers Are Sexy

Back-to-school for many post secondary students means the onslaught of credit card offers that entice with low interest rates and perks – Free Trip Anyone?

Before you apply for that new credit card, ensure you educate yourself on how to handle credit and manage debt. Student debt is such an important thing to understand. It is the begining of establishing a solid financial start as an education is pursued.