Monday, November 24, 2014

Essential Money Saving Tips for Students

It is easy to get caught in the rush of things when you are in college. In the midst of studying, part-time jobs, socializing and extracurricular activities that you have, you are most likely to forget one of the most important things, which is straightening out your finances. 

Here are some tips on how you can save money as a student:

1. Plan ahead. 

If possible, do this even before you move into your dorm room. 

Check if you are eligible for scholarships and other grants before signing up for any form of student loan. 

Construct a cash flow. First, where do you expect to get money from? Make a list of your “income”,  be it from your parents, your student loan or your part-time job. 

Then forecast your expected monthly or weekly expenses for food, books, etc. Once you have set aside a budget, be strict with yourself and stick to it. 

You will never know what unexpected expenses would come your way so it is better to have a downfall for financial emergencies. 

2. Save on food. 

One of the major expenses that you have as a student which you might have ignored when you were still living with your parents is your food allowance. Avoid eating at fast food outlets, as this is most likely to ruin your budget. Pack your lunch and plan your meals as much as you can.  
3. Take full advantage of student discounts. 

Those ID’s in your wallet are not just for show.  Student ID’s and memberships in organizations are honored in several establishments which offer discounts. 

Also, patronize a certain establishment regularly and you are bound to get bonus cards for being a loyal customer. 

4. Use your cash as much as you can. 

Since you already have a draft of the items where you will spend your money, it is easier to monitor your cash flow. Avoid using your debit card when you have cash with you. Use your credit cards or write checks only in emergencies. Having debit cards, credit cards and checks handy might lead you to overspend. 

5. Keep yourself busy. 

Join clubs according to your field of interest. 

Keeping busy will let your mind wander and help you stay away from things that you are likely to spend money on when you get bored. Examples of these are snacks, movie tickets or game rentals. 

You will be surprised at the amount of money that you will actually save by spending less on luxury items, following your budget plan and saving for financial emergencies that you are most likely to get as a college student. 

Wednesday, November 12, 2014

Starting Young: Teaching Teens to Save Money

Parents mostly complain that teenagers do not listen to them. The opposite is true when it comes to advice regarding 'money matters'. Teens actually welcome their parent’s input about their finances. 

In the past few years, teenagers have earned billions of dollars with part-time and summer jobs. Some have spent most of what they earned, while others saved most or even all of it for a big purchase, or for their college education. 

Kids these days are becoming more and more aware of their family's source of income and financial status. They apply these money-spending principles when they venture out on their own. Thus, it becomes more of a parent’s responsibility to start “training” their teenage kids to use their money wisely. 

Here are some ways on how you, as a parent, can teach your teens to save those hard-earned bucks: 

1. Lead by example. 

 With your lifestyle, the children will see how you spend your money. If they see you allotting a certain amount for a specific household need, they will eventually do the same when they get to earn their own keep. 

2. Help your teens get a bank account. 

Establishing a bank account under their name would give them an instant financial responsibility. Sit down and explain to them how to manage their own account, and the “rewards” that they get once they save enough. Their savings could go to their college tuition, or a big purchase like a car. 

 Additionally, it gives them a sense of accomplishment once they have saved up, with something concrete to show for it. You may check out the special benefits that banks offer for teens who open their accounts at such an early age. 

3. Construct a “spending plan”. 

Once they hear the word 'budget', teens tend to cringe at the mere thought of having to restrict the spending of their money. Instead, you and your teen son or daughter could build a “spending plan”. This would get them excited, and think of ways on how they can wisely spend their savings. 

 Also, have them list down their earnings versus their expenses. Let them know the difference between the items that they need and the luxury items that they want, which they can actually do without. 

 4. Make a “mock” investment in the stock market. 

Make them aware of the options that they have financially. Casually introduce to them the business part of your daily newspapers and have them make “mock” investments for companies who manufactures products that they like. Monitor the stocks together and this would give them another option of investing their money in the future.

Wednesday, November 5, 2014

Priorities Bring Focus to Family Budgeting

Often times, the family budget is a source of conflict.  Most of the time, the major earner makes the final financial decision, which isn’t always a welcome deal for the rest.  Since money is such an intrinsic part of family life, families need to achieve accord in this aspect. 

There is a four-step cycle in budgeting the family money to maintain peace and harmony.

1. Set your priorities.  

Priorities are different from goals.  They are aspects in your family’s life that you, as a family, want to set focus on, say health or children’s future. While goals are specific targets that support priorities.

In setting priorities, do not set too many as it defeats the purpose.  Ideally, there should only be one, but because life is not ideal, 2 to 3 are reasonable. 

As the priorities are set and agreed upon, write them down.  Post the paper where everybody can see them to remind them of what your family is focused on for the next few years.

2. List down your goals.

Once the family has set and agreed on priorities, the next step is to set the goals.  Goals are specific and measurable conditions that, when achieved, will support the priorities.  

In setting goals, establish a target that is both challenging yet achievable.  A 10-15% of the family’s income is a good savings target for a child’s future education: stretching yet reachable.

Try to limit your family into setting 1-2 goals per priority, to maintain focus.

3. Work towards your goals.

After setting your priorities and goals, start living by them.  All of the family’s activities will be geared towards working at your goals.  Track progress, particularly on financial goals, by using an income and expense-tracking tool.  The simplest way is to get a notebook and list down all expenses and incomes and set a budget for future spending.  There are those that invest in computer software or a family accountant.  Whatever it is, the important thing is to have a system of monitoring the family’s performance towards achieving their goals.

4. Evaluate your family life.

At a certain point in time, when you feel like it’s time to evaluate your life, check how your family is doing against the goals.  Goals that have been achieved can be checked off the list, and new ones can be formulated.  

At times, in major changes, say a career move, or when a family member goes away, it may be time to re-evaluate priorities. When such a time comes, then the cycle begins, just like what it’s for: life! 

Tuesday, October 28, 2014

Ten Practical Tips That Save Money

Saving money is not as hard as it seems.  Here are ten practical tips that you can do to begin saving money, without changing your lifestyle.

1. Replace incandescent bulbs with compact fluorescent (CFL) bulbs.  CFL bulbs consume 80% less energy than incandescent bulbs, but give the same illumination.  Make sure to buy only lamps and bulbs that have the Energy Star rating to ensure quality compliance.

2. Make a list when going to the grocery and stick to it! Anything that is not on the list is not a “need”, but merely a “want” so avoid busting your pockets for unnecessary items. Buy non-perishable consumables in bulk to benefit from bulk discounts.

3. Use coupons when available.  Take the time and have the patience to clip and organize grocery coupons.  When added together, savings from using all coupons in one grocery trip can be as much as $20-$30.  Purchase dining and shopping coupons online and print them at home.  Doing so can save you at least 50% on the face value of the coupons.

4. Buy online, whenever possible.  Online stores pass their savings from rental costs and warehousing to the online consumer, thus they can afford as much as 70% off their rack price.  When buying items online, Google it first together with the word, “discount code”.  This can give you further reductions on the item you want to purchase.  Try also online bidding:  they offer at least 75% off the original purchase price, for practically new (slightly used!) items.

5. Take lunch to work.  Buy potato chips and soda from the grocery and make a homemade sandwich and pack them in a brown bag.

6. Eat homemade dinners as often as possible.  Plan menus that are practical and easy-to-cook to encourage eating at home.  Save money by dining out only on special occasions.

7. Use everyday pantry items for skin and body care.  Cucumbers, honey, milk, lemon, salt and baking soda are some items in your home that can also be used to take care of your skin.

8. Avoid shopping to de-stress.  Try walking around the park or watching a movie instead.

9. Bring your own sodas and snacks when watching a movie. The cost of sodas and snacks are at least 25% higher in movie houses.  Plus, homemade popcorn tastes much better: you can put on all the salt and butter you want!

10. Pay off your credit card balances each month and avoid finance charges.  Better yet, use cash as much as possible, unless using plastic will give you a better deal (0% interest on appliance purchases, or cash rebates).