How to Minimize Daily Expenditures

With the threat of a recession looming overhead, gas prices soaring, and the cost of nearly everything on an upward rise, it has become increasingly important to save money on the things we used to consider fixed costs. We need to be creative in our thinking, here. I have made a list of necessities and some wants that I think can be reduced.

Healthcare, alone, in America has increased at a substantial rate over recent years. Many older Americans, and younger ones with chronic health conditions, are finding it hard to cover their drug costs. There are ways to lessen the strain on your wallet, however.

Generic drugs are about 1/3 the cost of brand name prescriptions and just as effective. You can also use a pill splitter to double your dosages. Be careful, though, capsules and time release tablets should NOT be split. If you have questions you should consult your pharmacist.

There are also many programs offered by some of the large pharmeceutical companies that provide discounted or free drugs, if you qualify.

Finally, do not assume that prescription drug costs are the same from pharmacy to pharmacy. Online pharmacies often offer much cheaper prescription because they don't have the overhead costs that traditional pharmacies do. Make sure that the pharmacy you are buying from carries the Verified Internet Pharmacy Provider Seal or V.I.P.P.

Over the next few weeks I will be offering many more suggestions for cutting back on your fixed costs. Please bookmark my blog and return daily for updates.

Repairing Your Credit

Wether you are just starting out on your own or have been managing your finances for years, it is becoming increasingly important to have good or even great credit in order to secure a loan with good terms. You may have seen or heard advertisements from companies promising to "fix any credit problems", however, whatever these companies can do for your credit, you can do yourself, for free.

The first step in repairing your credit is to obtain your annual free credit report from each of the major credit bureaus: Experian, TransUnion, and Equifax. You can accomplish this by visiting the following website: http://www.free-annual-credit-report.org.

Once you have access to your credit reports, verify that all of the information is correct. Pay very close attention. If you find any errors, contact the credit bureau with the error you found and any necessary paperwork substantiating your claim. The bureau will investigate the claim and correct the inaccurate information. Make sure you check your credit report after a short time to make sure the error has been corrected.

Good payment history is likely the most important part of maintaining a good credit score. Even if you have past missed or late payments, do not let that discourage you. Keep current with your future payments, because the older the negative information is, the less it will impact your credit rating.

Your fico score is what most institutions look at to determine your interest rate for loans and your credit-worthiness. This score is based on several factors, including: Payment History - 35% Amounts Owed - 30% Length of Credit History - 15% New Credit - 10% Types of Credit Used - 10%

The next thing you need to be aware of is what outstanding debts you have. If you have any debts that are in collections and showing up on your credit report, pay those off. If you haven't enough money to completey pay them off, take whatever amount you can afford and begin paying down your debt. Pay off high interest debt first.
There isn't much about your length of credit history that you can do. You can, however, establish your credit if your credit report is void of any transactions. You may need to begin with a secured loan or use collateral to acquire a small loan from your banking institution. Pay this off quickly and you will be on your way to increasing your credit rating.

Here is a very good tip, if you have credit cards and are considering cutting them up, beware. Keep your oldest line of credit open, but only carry 10% of the total available credit. If your credit limit is $2000.00, then only charge the amount up to $200.00.

Be leary of department store credit cards. They usually have a very small limit and will cause your debt to credit ratio to be out of synch. This will reflect negatively on your credit score.

A mix of different types of credit can help your fico score. Credit cards, installment loans, and fixed payment loans can improve your score. However, this is ONLY true if you manage your credit RESPONSIBLY.

To sum up the best way to repair your credit report, review the following list: 1. Always make your payments on time. 2. Keep your debt to a minimum. 3. Check your credit report every 3 to 6 months, for inaccuracies and dispute them in writing, if necessary. 4. Keep your oldest line of credit open with a 10% or less balance. 5. Pay off any outstanding or negatively reported debt as swiftly as possible. 6. If no credit is your problem, look at acquiring a secured loan and pay it off on time. This will help to establish a good credit history.

How to Invest

You've probobly been thinking about investing for a long time, but the whole idea of the stock market is a bit scary, especially with the recent talk about recession and the poor economic state of our Country. In this post, I will try to demystify the stock market.

Step One

The first step in learning how to invest is to know where to invest. This can be especially tricky in times when the stock market seems to be dropping out of sight. However, if you are a well learned and researched investor, you can beat the odds and create a nice return rate for yourself.


Step Two

The smartest way to invest in these economically challenged times are to continually add money to your investments and to hang in there for the long haul. If you don't need the money you are going to invest for atleast five years, you are relatively safe in the stock market. History suggests that in periods greater than five years you can expect a descent return rate. The longer you have to leave it alone, the better off you'll be.


Step Three

There are ways, however, to improve your rate of return, especially in near recession times. Look to invest in companies that have strong cash flow. These companies should be ones that are stable and have been around for a while. They should be companies you can depend on to be here in the next 5, 10, 20 years, when you need to cash in on your investment.

Step Four

Some industries that are likely to improve over the next decade are biotech, alternative fuel companies, and video game companies. Look towards these industries for your long term investing.

Tips and Warnings

• Do not buy all your stocks at once during times when prices are likely to fall even more
• Steadily add to your investments each month. This will give you more stocks for your money at the end of the year
  
• Read and learn as much as you can, but when it comes down to it, trust your own instinct.

How to To Eliminate Debt

With the doom of a recession lurking in the near future, financial stability is on the mind of many Americans and Global Citizens alike. In this post, I will provide tips on how to eliminate your debt so that you can begin building wealth.

The first thing you should do is to gather all of your outstanding bills. Request a copy of your credit report from all three Credit Bureaus; Experian, TransUnion, and Equifax. Be on the lookout for mistakes. Although all three credit bureaus should have identical information, that rarely is the case. If you do find a mistake, contact the agency immediately and ask them to correct the information. You may have to contact the original creditor.

Find out what your FICO score is with each bureau. This is the three digit number that determines the interest rate you pay on everything from mortgage to credit cards. To get the best interest rates your score needs to be 720 or above, however, if you are reading this article there is a fair chance that you fall slightly or well below this number. Your goal should be to increase this number. If your Fico number is less than 620 you are considered “risky”, and will therefore pay a higher interest rate.

Another very important step in this process is to devise a budget. First, sit down and write how much money is coming in and how much is going out, and where it is going. Decide to eliminate or cut back on unnecessary expenses. These could include switching from expanded cable to basic or regular tv (ouch, I know), but it needn’t be forever and you may even discover alternative interests you didn’t even know you had, not to mention the quality time you will have with your family. Decide to use coupons when grocery shopping. Many stores offer double coupon day and you would be surprised how much you can save with just a little time invested. Review your cell phone bill. How many minutes are you actually using. Are you throwing away valuable talk time at the end of each month or going over and incurring unnecessary overages? Find the best plan that suites you and your family’s needs.

If you notice that you’re heating and/or electric bill seem high, go through your residence and find ways to save energy. If you live in a cold climate, you may want to put plastic on windows that are letting in too much cold. You may want to invest a little cash into some door snakes that eliminate drafts from under doors. These are just a few ideas that will help you cut costs and free up funds that could better be used to reduce your debt.

Once you have scoured over your budget and eliminated as much unnecessary expenses as you can think of, it is time to attack that debt. The most important place to start is any high interest credit cards. If you are carrying a lot of credit card debt, or even not so much, but have a high interest rate, it will take what seems like an eternity to pay off if you only pay the minimum balance each month. But, let’s not get ahead of ourselves. I would like you to first contact your credit card companies. Tell them that you are trying to eliminate your debt and that you would like to avoid bankruptcy. If you have had any recent negative events such as loss of a job or injury, tell them so. Ask if they could reduce your interest rate. The credit card company would rather get some of your money than none at all. Most companies will agree. If at first you don’t succeed, try and try again. With so many companies outsourcing their customer service it can be very frustrating trying to get to the person who can really help you. You may want to start out asking for a supervisor or someone with authority to decrease your interest rate.

After you have tackled the high interest credit cards, approach other creditors that may have debt against you that has been sitting there for a while. Call the creditor or the credit agency that has taken over collection. Many of these companies will be willing to settle for a fraction of the debt if they know you are contemplating bankruptcy or are willing to make a one time large payoff.

If you don’t have enough money saved from your new budget, here are a few ideas to help increase your income: pick up a second, part-time job (remember, it doesn’t have to be permanent, just to get you out of debt), have a yard or garage sale with unwanted or unused items, volunteer services such as plowing or mowing for a neighbor, have a bake sale with items you make from scratch, start scouring garage sales and auctions for items to resell on Ebay.

The most important thing you can do to turn your financial life around is to PAY YOURSELF FIRST. What does that mean? It means that you take a certain amount, as much as you determine, a good starting point is anywhere from 10 to 20% of your take home pay. Invest this each month. Whether it is in stocks, mutual funds, cds, gold, or some other viable investment option, put your money to work for you. The stock market may be down right now, but eventually it will be up again. Use this opportunity to snatch up discounted stocks of well established companies that you know will be around in 5 to 10 years. There is a wealth of information available out there. You just need to make a conscious decision to change your financial future. It is in your hands and the time is now!

How to make money during a recession

With so much talk about a slumping economy and a downsliding stock market it is hard to imagine grasping onto any hope of yielding a profit during these times. Here are some suggestions that may help you survive during an upcoming recession.

Many of the country's wealthiest entities made their money from snatching up bargained stocks and holding on to them when the market recovered. If you are able to leave your investmenst to grow over a 5 to 10 year period, it is pretty safe that you will earn a descent profit. You simply need to search for well established companies that are sure to be around and stable in the next 5 to 10 years. Think of companies such as Coca-Cola, General Electric, Proctor and Gamble, and the like. You want to pick companies with low debt, steady growth, and strong earnings. In order to pick the best stock from a list of strong companies, pick the one that is farthest from its 52 week high. This is called Value Investing.

Do not use all of your investing money to buy up as many shares as you can at once. Break up your purchasing throughout the year. In a recession, stocks are likely to continue decreasing in price. By the end of the year, you will have more stocks for your money than if you would have purchased them all at once.

Next, look towards industries that thrive no matter how the economy is doing. People always need to eat. People always need household supplies, even if they aren't spending as much on them. They always need utilities. Invest in these companies.

Another way to make money during a recession is to buy under priced stocks of a company that is estimated to thrive during a recession. These will be companies that provide a product or service that is "needed" rather than "wanted". Also, since people spend less money during a recession and usually hesitate to put out cash for large luxury items, they will more than likely spend on accessories for the items they already have. This can include video games, digital camera components, mp3 player accessories, etc. Look to invest in these types of companies.

How to earn extra cash

I have resolved to make this the year that I start digging myself out of debt and becoming a "frugal expert", or atleast frugally responsible. The place I, and most people, start is by creating a budget and determining where they can cut costs. This is a wonderful way to minimize spending, however, on a limited income there are only so many corners you can cut before your lifestyle starts resembling that of the Amish.

I have put together a simple list of ways that you can earn some extra cash, rather than finding more ways to cut the already slivered dollar.

Here are some great tips increasing your income:

Have a Garage Sale - Go through your closet, attic, garage, or grandma's house in search of items you no longer use or need. Long neglected or forgotten objects may become someone else's found treasure. These may include neglected electronics, forgotten board games, or outgrown childrens' clothes.


Make crafts - People go bananas for all kinds of homemade craft items. Even if you don't consider yourself "creative", you would be surprised at how many projects are actually very easy to reproduce and can wind up turning a descent buck. Use a theme, such as an upcoming holiday, for your crafts and watch them fly off the racks.

Bring items to Resale or Consignment Shops - If you don't have the time or space for a garage sale, consider gathering up unused, quality items and taking them to your local resale shop. Many such stores offer a fair return on your sales. After all, it isn't bringing in any money just sitting under the bed!

Donate Plasma - There are many blood banks that offer payment for donating your plasma up to twice a week. This is a great way to earn some extra cash and leave with a good conscience, knowing you are also saving a life! Make sure you eat a healthy snack before donating.

Offer to run erands - Offer to run erands for a neighbor or someone who is immobile. They will likely appreciate your help and may refer you to others needing the same service.

Offer house cleaning - This is a great one, because many people hate cleaning their own house. I actually did this one and although I can not stand to do daily chores at my own place, somehow knowing that I wouldn't have to watch someone else's house become dirty again, gave me a unique satisfaction. Also, you would be surprised at the prices most people are willing to pay for a good cleaning!

Invest - One of the easiest ways to earn a little (or a LOT) of extra cash is to invest some of what you already have. It doesn't take very much to begin and you would be amazed at how fast money grows when it is compounded! This is how the rich are able to get and stay rich. Watch and participate in the stock market. Mutual funds are good choice. Be sure to diversify.