Getting Financially Stable: Everything You Need to Know About Taking Out a Loan

Being optimistic about your finances is only natural. Most people have high hopes concerning their job prospects, lifelong earning capacity and financial management skills. But, reality might have another plan.

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What Is Financial Stability?

 Financial stability is both an objective and subjective quality. The objective standard is having an income that is higher than your expenses. You must make more money than you spend.

But, the subjective character is based on your financial status. Most people will admit that rich people have a different life style than others. For many of them, they can coast for a while before the day of reckoning arrives.

But inevitably, it will arrive. Everyone pays the piper. So, even though the wealthy have a higher income, they also must develop wise management skills. We will discuss a few of these.

Make a Budget

 Musicians practice, athletes practice … pretty much anyone who wants to succeed practices and prepares a plan. How can you control your expenses, when you don’t even know what your credits and debits are? You need to start by making a budget.

Some people don’t want to face financial reality. They want to believe that they are wealthier than they are. We see this a lot with athletes and celebrities. When their salad days are over, they might file for bankruptcy.

If you fail to plan, you plan to fail. = Benjamin Franklin.

Create a budget. If you are continually dipping into your savings, then you know you are not making ends meet. And, something that cannot go on forever, will not go on forever.

Write down your expenses and income. Then, see what your surplus or deficit is. Decide how you are going to make up that deficit.

You might try to add more hours at work. Or, you might consider taking out a personal loan. Saving money requires having higher income than expenses.

Balance Your Cheque Book

 Once you have a planned budget, see how you are doing each month. Balance your cheque book. Many people assume that bankers are never wrong. But, they do make mistakes.

After balancing your cheque book, you can identify any errors made by your bank. This also gives you a better understanding of your spending habits. You need to know how you spend money before you can improve your money-spending habits.

Count Pennies

 Remember the parable of the grasshopper and the ant. The grasshopper liked to visit the grocery store in the middle of the week and throw large parties. He had a great bar-be-cue, but didn’t produce anything of note.

While, grasshopper partied, ant was working hard, storing up food for winter. Grasshopper wondered why ant worked so hard. Ant told him that when winter arrived, those who stored away wealth would survive. Eventually, winter arrived and ant had plenty of food stored up while grasshopper starved.

How will you reap, when you have not sown? 

Those who save money, count their pennies. If you need help calculating your pennies, then you can use the Acorns App. Financial management has never been easier.

This money management app helps you earn found money, grow your knowledge, invest for your future and spend smarter. It is like having a financial assistant with you all day long. Sometimes, people need a little nudge to improve their saving habits.

Cut Corners

Paying off debt requires both a physical and spiritual commitment. Physically, if you don’t have enough credit, then you need to reduce your debt. You need to cut corners.

Enjoy some home cooking and reduce your visits to five-star restaurants. You might want to watch an old movie on date night. Reduce your expenditures to create a better threshold for your budget.

Find New Income Sources

 Sometimes, debtors need a little financial boost to help them regain their composure. When you are priming a pump, you introduce a similar liquid to draw out the liquid. Find new income sources to increase your cash flow.

After you learn more about personal loans, you can find the best financing means. Use the new funds to pay off the bills with the highest interest rates. Compound interest can quickly drag you underwater, like a drowning swimmer.

Create Rainy Day Fund

 You wear a seat belt just in case you get in an accident. A rainy day fund can help you overcome little glitches in the budgeting process. For example, your rent is probably due the beginning of the month, while your pay cheque arrives every two weeks. Sometimes, these two periods of time don’t mesh perfectly.

Instead of incurring late fees, create an emergency spare cash fund. You might even include a full month’s rent. This ensures that you are always on time.

Landlords and bankers expect you to pay your bills on time. They have a very fine-tuned system that will deposit the funds into their bank accounts immediately. There is a “Domino Effect” when they’re not paid – managers ask where the money is.

A rainy day fund smooths over many rough edges. It can be used to keep everyone happy. Toss a $20 therein when you get paid.

Healthy Financial Management Skills

Changing bad financial management habits can take some time. Psychologists believe that the development of good skills might take at least two weeks of constant repetition. Send yourself an alert from your smart phone, urging you to save more every single day.

After two weeks, there is the hope that this new habit will be well-ingrained. Use a multi-dimensional strategy for regaining financial stability: make a budget, cut costs and find new income sources. Develop healthy financial management skills to pay off your debt. Then, you can sleep better at night.

Giving Yourself A Financial Overhaul For The New Year

The time has come to start thinking about the goals and new year resolutions that you want to put in place for next year. Many of which, can be financially related. So many people aim for things such as owning a home or moving from one house to another. Saving for certain holidays or rainy days or even just being debt free. Whatever your financial goal may be, you need to start thinking about it now and planning to make it a reality. But how can you do that? Try these steps to help give yourself a financial overhaul. It could help you get in the right frame of mind for the year ahead.

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What goals have you got in mind?

First of all, take some time to think about your financial goals that you have for the new year. Think about what it is you want to achieve. It doesn’t matter how big it may seem. Owning a house for example, or paying off your debts may seem impossible right now. But the whole point of making the financial goals is so that you can then take smaller steps with different targets to help you achieve it. It might be worth writing it down somewhere that might remind you often what it is you are wanting to do.

Know what position you are in financially

The next thing to think about would be to look at your current financial position. Look at what position you are in buy checking your last three months bank statesmen’s. This will highlight exactly what outgoings you have and their costs. It will also help you to understand what you are spending each week on things like food or other things like clothes or luxuries. Knowing what you spend and how much you have going in versus leaving your account will help you to try and make savings where possible.

Time to get serious about your credit history

If your goals next year involve any from of credit application, like consolidation loans for debt or mortgage applications for buying a house, then you need to understand your credit history and scoring. You also might want to monitor it moving forward so you know everything that is going on behind the scenes. This is when looking at the best credit monitoring services comparison article online can help you decide when he one is best for you. Knowing where you stand on your score and history will help you improve it or make changes such as correct details before making any applications in the future.

Is it possible to make savings now?

Finally, is it possible to make savings right now? I think that you could look at what your spend and make some changes to give you some instant savings. It could involve switching providers for things like energy or insurance products. Maybe it could be reducing your food shopping bill by meal planning, changing where you shop or switching from branded to shop own products.

If you are in need of a financial overhaul, these are ways you can start to actively make savings and doing things now, which will then help you start fresh in the new year to achieve your goals.

5 Ways to Making Saving Exciting for Kids

Saving money is a valuable life lesson that it is important to teach from a young age. The more good practices are instilled in childhood, the more likely it is that they will be continued throughout life.

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There are a wide variety of different techniques that we will talk a little bit about here, but teaching the relationship between family and money is something that should be ongoing. So, let’s get on and look closer at some money-saving teaching tips.

Make a Savings Chart

If your child wants to save for a particular toy, you can make a chart to figure out exactly how much money they will need to save. Your son or daughter can then place a sticker in the chart each week that they save money so they can actually see themselves getting closer and closer to their overall goal which certainly builds up excitement.

Offer Rewards

You will probably be all too aware how effective rewards can be when encouraging your kids to do something, so think about what motivates them – whether this is an extra half hour playing video games or a trip to the movies – and offer this as a prize if they hit a particular savings goal. This helps to reinforce the positive link between savings and rewards.

Teach Them About Shopping Around

The internet has opened up a whole world of financial opportunity, and one thing that is a good idea to teach your children is about shopping around for a deal. This helps to show them about getting the most for their money and the knowledge that their savings will go further if they always get the best price that they can.

Set a Good Example

Of course, kids learn by example, so if they see you regularly saving your money then they are much more likely to follow suit. If your kids are particularly young, you can show them about saving money by putting your money in a jar. You can then get your kids a jar of their own so they can start to copy you. If they are older, you can set a good example by helping them to open up a savings account at your bank.

Play Games

Board games such as Monopoly and The Game of Life are useful in promoting the value of saving. They also help to demonstrate the consequences of certain decisions and the fact that unexpected costs sometimes spring up in life. While you are playing the games, you can talk to your kids about the similarities and differences that they have with real life financial decisions.

These are just five basic techniques that you can use to help get your kids saving money. Ultimately, it is all about showing them the rewarding aspects of saving money by getting them excited about it. As well as this, you should always be looking to teach them small financial lessons whenever you can that they can apply to real life situations.

Teaching Your Kids To Save Money

You might think that your kids are too young to learn about money. They must enjoy playing as kids. They must also be dependent on you when it comes to their financial needs. Although this is true, you have to understand that it won’t be true for long.

Kids grow up really fast. Before you know it, they are off to college and your kids will make their own financial decisions. You don’t want them to keep running back to you when they are already adults just because they are buried in debts.

This is true especially if you have also gone through the same problem in the past. You must have learned things the hard way. You should let your kids know that they don’t have to suffer the same fate. By being more financially responsible, they can escape debt problems and be more financially empowered.

To begin with, you need to show them the value of saving money. Teach them to make priorities when buying stuff. They have to understand the meaning of prices. Why would they choose one over another? What would they sacrifice if they buy a toy over food?

You need to give them actual situations for them to decide on. This will force them to think and make the right choices. As they grow older, they can use what they have learned as they face more difficult challenges. You will not always be there for them. While you can, you have to make sure that you let them understand the value of money.

Below is an infographic that will teach you the best ways to let your kids realize why being financially responsible is important. Hopefully, you can show to them the right ways to save money that they will carry with them for the rest of their lives.

9 Ways To Teach Kids To Manage Money

Financial Life Lessons Every Parent Should Teach Their Children

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People say that knowledge is power, but what if you don’t posses the knowledge you need to succeed? The unfortunate answer is that you won’t succeed, at least not to the level that you desire. If that is a scary thought, it gets even scarier when you apply it to your children. Every parent wants their kids to lead a happy and prosperous life, so every parent needs to impart wisdom along the way. There are some things that they don’t teach at school, and that is where you step in and fill in the gaps. Finance is probably the best example, which is why you’ll find the best financial tips to teach your kids below.

Wait For The Right Moment

Kids are impulsive and want everything as soon as possible. Hell, there are a lot of adults that fit into that category too. But, there is a problem with this way of thinking: it leads you to make financial mistakes. Have you ever wondered why some people are in mountains of debt? The easy answer is that they have bitten off more than they can chew. Of course, everyone wants nice things like a car or a house, but they shouldn’t come at the expense of a family’s future. The sooner children learn they have to wait, the better the decisions they will make with in the future.

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Don’t Be Scared Of Big Decisions

The big decisions aren’t ones to fear; they are ones to cherish. The great thing about making big decisions is that they often have the biggest rewards. Take buying a house as an example. To buy one, most people need to take out a mortgage. Since the crash in 2008, the term mortgage isn’t one that fills people with trust. In fact, lots of people think that a mortgage is a bad idea. The truth is that a mortgage is essential as long as you understand it inside and out. Nowadays, that is a lot easier to do when you go online at CalMtg.com and other mortgage professionals. With the right amount of patience and confidence, your children’s finances will never be in doubt.

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Save, Save, And Save Some More

Okay, so it isn’t a great time to save especially now interest rates are lower than before. Still, there will come a time when they will rise, and your children will want to take advantage. Although spending is more fun, saving is the practical option. It is the financial tip that will ensure your kids will always have money for a rainy day. Excuse the cliché, but it is true. Parents can’t always bail their kids out when they are in too deep, and kids need to learn this important life lesson. Putting away a little every month is a great way to create a buffer, and if it doesn’t come in handy they can spend it on a holiday.

The above is only a small glimpse into the big bad world of finance. Even so, a little bit of knowledge can go a long way.