Archive for the ‘Interest’ category

Top 10 Financial Resolutions for 2011

January 4, 2011

The start of a New Year is always an opportunity for each of us to reflect on our lives, establish new goals and renew our commitment to improving our lives.   One of the most important areas of our lives is our personal finances.  Our personal finances impact every area of our lives.  Therefore, it is essential that we take control of our personal finances.  

Here are some ideas and proven financial concepts that can dramatically impact your personal life and finances.   I hope you will take the time to read through them.   More importantly, I hope you will take the time to implement some of these ideas into your own personal finances.  

10.   Commit Time Everyday to Improving Your Financial Literacy.  How much time will you spend on the internet and watching TV today, this week or this year?  How much time have you invested today, this week or this year improving your financial literacy?   What is more important?   There are countless free resources available on the subject of personal finances and improving your financial literacy.   Remember, we must take full responsibility for our own financial lives.  Simplify this task by working on one subject at a time.  Pick something basic like home budgets, etc. and get started today. Work on this with your spouse, family, friends etc.  Together you will learn more and encourage one another. 

9.    Simplify Your Life – Our worlds are becoming more complex with every passing day.  What is consuming your life, your money and your attention and distracting you from the real things in life that are truly important in your life?  What can you eliminate or give away that will cut your expenses, free up your mind and simplify your life? 

8.   Protect Your Credit  –  Your credit scores are a reflection of how you have handled your credit and the repayment of your debt.  Your credit score is also used by lenders and other institutions to evaluate your risk in a variety of areas.   Your credit score may be used in conjunction with securing employment, renting housing, obtaining auto insurance, etc.   Therefore, it is essential that you do everything possible to protect your credit score.  Since your credit score is a reflection of you it is essential that you take the necessary steps to prevent and protect yourself from identity theft.   

7.   Asset Protection – It is absolutely critical that you have a will or a trust to protect their assets and provide for your family.  You do not have to be wealthy in order to have a will or a trust.  If you own a home, car, IRA / retirement accounts, insurance policies, etc you need a will or a trust.  This is absolutely critical if you have minor children.   A will or a trust allows you to decide who will be the guardian for your kids, who will receive your assets, etc.  Do not risk leaving these critical decisions to be decided by a court appointed representative in probate. 

6.   Create Clear, Concise Financial Goals – This is one of the most important steps in achieving financial freedom.  It is our clearly stated goals that we have committed to writing that will compel us to take action to achieve financial freedom.  Without clearly stated goals we will abandon our financial commitments for the future and only think of our immediate wants and needs.  We cannot afford to waste our precious time, money and resources consuming our future by our lifestyle choices today.  Therefore, it is absolutely essential that you take some time and write out your vision and goals for your finances and life.   You want goals that will inspire you.  Goals that motivate you to achieve financial freedom and live the life you have always imagined living.  For more information on this subject see my previous post.

5.   Pay Yourself  First – This is not a suggestion, but a key fundamental rule for anyone that has achieved financial freedom.   Have you ever stopped to ask consider how hard you work for your money?  Who are you really working for the bank, the mortgage company, the credit card company?  Stop making someone else rich!  You must always pay yourself first.   Start saving today and learn how to put your money to work for you.

4.   Establish Cash Cushion   A cash cushion is an emergency fund that is created to cover your living expenses for 3-6 months.  It is also used to cover unforeseen expenses, repairs, etc. that come up in everyday life.  The purpose of a cash cushion is to keep you from incurring expenses on your credit card when emergencies arise.  A cash cushion will also provide you peace of mind that you have 3-6 months living expenses in the bank at any time.   I encourage you today to set up a separate bank account and start funding your cash cushion account.

3.   Stop Consuming Your Future – Control Your Spending   When was the last time you reconciled every dollar you spent for the last 30 days?   When was the last time you looked at every charge on your credit card statement?   I challenge you to track every expense for a minimum of 30 days to see where all the money goes every month.   Use this exercise to look for ways to reduce unnecessary expenses, save money, etc.  We live in a consumer driven world.  Our spending habits are consuming our future.  We must take control of our spending habits to start moving towards achieving financial freedom.

2.   Become Debt Free – Debt is consuming the lives of millions of people.   Debt is what keeps us from pursuing our hopes, goals and dreams for our lives.  Debt robs us of our future.  The only way we can take control of our financial lives and our future is by becoming debt free and never going back into debt.  Debt free living must become your passion and your unrelenting goal.  Debt free living can be a reality for anyone that is willing to commit to the goal.  What if you were debt free?  How would it change your life?  What could you do or pursue if you were debt free?

1.   Create & Live Within A Budget    A budget is absolutely critical for anyone that is committed to achieving financial freedom in their lives.  A budget provides us the input we need to manage our income and our expenses.  A budget provides us accountability. A budget provides us a tool to work on achieving our financial goals.  A budget will dramatically impact your personal finances.   It will provide you the roadmap to achieve your financial goals.

 I hope you have benefited from this post on Financial Literacy.  If so, leave a comment.  In addition, please forward this to anyone you think might benefit from this short financial literacy lesson. 

You can follow Fiscal Literacy on Twitter and Facebook.

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Fiscal Literacy Friday – Concept of Generosity

December 10, 2010

Generosity should be a component of building and applying our knowledge of financial literacy to our own lives.  Why is generosity such an important component of financial literacy?  Because it takes the focus off of our own selfish desires for our lives.  It provides us with a greater purpose for our money that far exceeds our own selfish desires. 

“We make a living by what we get, we make a life by what we give” Duane Hulse

We all need to be reminded that our lives will not be remembered for how much we earned or how hard we worked.  Our lives will be remembered for how we touched and impacted the lives of others. 

  “All of us are born for a reason, but all of us don’t discover why.  Success in life has nothing to do with what you gain in life or accomplish for yourself. It’s what you do for others.” Danny Thomas

Therefore, each of us should look for more meaningful ways to use our money, time and talents to impact others less fortunate than ourselves. 

We don’t have to wait to become millionaires to start practicing the concept of generosity.  We can start today. There is always someone less fortunate than us and we can impact their lives today.

Maybe this holiday season each of us should be asking ourselves this question: 

What is the greatest gift I can give this holiday season?  It is the gift of my time & resources to help others less fortunate than myself.

Here are some questions that may help you get started:

  •  Where can I make a difference this holiday season?
  • Who or what is on my heart? 
  • How can I use my unique gifts and abilities to touch and impact the lives of others less fortunate?  
  • Where can I and or my family get involved? 
  • Where is an unmet need in my community or in the world that I feel passionate about getting involved in?
  • What random acts of kindness can I anonymously perform today? 

 “You have not lived a perfect day, even though you have earned your money, unless you have done something for someone else who will never be able to repay you”  Ruth Smeltzer

 Ralph Waldo Emerson said “It is one of the most beautiful compensations of this life that no man can sincerely try to help another without helping himself”

Therefore, I hope you will use this holiday season to find your purpose and passion in life for helping others.  This new found purpose for you and your money may be the first step towards getting freed up financially.  It may provide the motivation to reduce your expenses, become debt free, set a cap on your lifestyle and use your resources to make a lasting difference in your community and our world.

I hope you have benefited from this post on Financial Literacy.  If so, leave a comment.  In addition, please forward this to anyone you think might benefit from this short lesson on the 10 Keys to Financial Freedom.  

You can follow Fiscal Literacy on Twitter and Facebook.

Fiscal Literacy Friday / Financial Literacy 3 Keys to Debt Free Living

November 19, 2010

Debt is consuming the lives of millions of people.   Debt is what keeps us from pursuing our hopes, goals and dreams for our lives.  Debt robs us of our future.  The only way we can take control of our financial lives and our future is by becoming debt free and never going back into debt.  Debt free living must become your passion and your unrelenting goal.  Debt free living can be a reality for anyone that is willing to commit to the goal.  What if you were debt free?  How would it change your life?  What could you do or pursue if you were debt free?  Here are 3 Steps to help you become debt free.  

 

1.  Cut Expenses – We live in a consumer driven world.  Our spending habits are consuming our future.  We must take control of our spending habits to start moving towards achieving debt free living.  Therefore, the first step towards achieving debt free living is to cut out our unnecessary expenses.  When was the last time you reconciled every dollar you spent for the last 30 days?   When was the last time you looked at every charge on your credit card statement?   I challenge you to track every expense for a minimum of 30 days to see where all the money goes every month.  My family and I just completed this exercise.  I was blown away at how much money we wasting every month.  We were only able to identify these unnecessary expenses by tracking every dollar and keeping every receipt for a minimum of 30 days.  This simple exercise has dramatically impacted our spending habits and has freed up a lot of money.  Therefore, I challenge you to use this exercise to look for ways to reduce your unnecessary expenses and start saving money.

2.  Payoff Debt – Our debt is typically the result of the lifestyle choices we make on a daily basis.  We never stop to realize that with every swipe of the credit card we are consuming our future.  We never stop to think how much the new car, boat or other luxury items we purchase with a personal loan costs us over our lifetime.  Until one day we wake up and realize we have nothing to show for all of our hard work.  This is the reason millions of people are unable to retire and enjoy life the always dreamed of living. Therefore, nothing is more important than paying off your debt and taking control of your financial future.  We must create a plan to systematically eliminate all our debt one debt at a time.  We must commit to stop using our charge cards and only paying cash.  This will require a change in lifestyle and discipline. However, the financial freedom and rewards of debt free living will change your life forever.   It will free you up financially to pursue your hopes, goals and dreams for your life. 

3.  Cash Cushion – It is a lack of personal savings that forces us to use our credit cards or obtain personal loans to pay for the expenses we incur in our lives.   Many of these expenses are unplanned expenses for car repairs, kid’s braces, home repairs, etc.  We also use our credit cards for pay for other large expenses i.e. vacations, holiday shopping, home furnishings, etc.  These large expenses dramatically impact our overall debt, increase the costs of every purchase due to the interest we pay over time and also reduce or eliminate our ability to save money, fund retirement, etc on a monthly basis.  Therefore, we must commit to establishing and funding a cash cushion account or emergency funds account to pay cash for these expenses as opposed to charging the expenses.    

A cash cushion is an emergency fund that is created to cover your living expenses for 3-6 months.  It is also used to cover unforeseen expenses, repairs, etc. that come up in everyday life.  The purpose of a cash cushion is to keep you from incurring expenses on your credit card when emergencies arise.  A cash cushion will also provide you peace of mind that you have 3-6 months living expenses in the bank at any time.   I encourage you today to set up a separate bank account and start funding your cash cushion account

I hope you have benefited from this post on Financial Literacy.  If so, leave a comment.  In addition, please forward this to anyone you think might benefit from this short financial literacy lesson. 

You can follow Fiscal Literacy on Twitter and Facebook.

Fiscal Literacy Friday – Financial Literacy Lessons 10 Keys to Financial Freedom

October 15, 2010

 

The financial crisis has impacted the lives of millions of people. Therefore, there has never been a more important time than now to educate and empower yourself to take control of your own personal finances.   Here are some ideas and proven financial concepts that can dramatically impact your personal life and finances.   I hope you will take the time to read through them.   More importantly, I hope you will take the time to implement some of these ideas into your own personal finances.  

 

1.  Our Choices, Have Consequences – We must accept full responsibility for our own financial futures.  We must understand that our financial decisions and choices today will impact our lives tomorrow.  Therefore, we must evaluate all of our financial choices, expenses, purchases within the context of our overall long term financial goals and objectives.      

2.  Stop Consuming Your Future – Control Your Spending   When was the last time you reconciled every dollar you spent for the last 30 days?   When was the last time you looked at every charge on your credit card statement?   I challenge you to track every expense for a minimum of 30 days to see where all the money goes every month.   Use this exercise to look for ways to reduce unnecessary expenses, save money, etc.  We live in a consumer driven world.  Our spending habits are consuming our future.  We must take control of our spending habits to start moving towards achieving financial freedom.  

 3.  Create & Live Within A Budget    A budget is absolutely critical for anyone that is committed to achieving financial freedom in their lives.  A budget provides us the input we need to manage our income and our expenses.  A budget provides us accountability. A budget provides us a tool to work on achieving our financial goals.  A budget will dramatically impact your personal finances.   It will provide you the roadmap to achieve your financial goals. 

4.  Pay Yourself First – This is not a suggestion, but a key fundamental rule for anyone that has achieved financial freedom.   Have you ever stopped to ask consider how hard you work for your money?  Who are you really working for the bank, the mortgage company, the credit card company?  Stop making someone else rich!  You must always pay yourself first.   Start saving today and learn how to put your money to work for you. 

 5.  Become Debt Free – Debt is consuming the lives of millions of people.   Debt is what keeps us from pursuing our hopes, goals and dreams for our lives.  Debt robs us of our future.  The only way we can take control of our financial lives and our future is by becoming debt free and never going back into debt.  Debt free living must become your passion and your unrelenting goal.  Debt free living can be a reality for anyone that is willing to commit to the goal.  What if you were debt free?  How would it change your life?  What could you do or pursue if you were debt free?

 6.  Establish Cash Cushion   A cash cushion is an emergency fund that is created to cover your living expenses for 3-6 months.  It is also used to cover unforeseen expenses, repairs, etc. that come up in everyday life.  The purpose of a cash cushion is to keep you from incurring expenses on your credit card when emergencies arise.  A cash cushion will also provide you peace of mind that you have 3-6 months living expenses in the bank at any time.   I encourage you today to set up a separate bank account and start funding your cash cushion account.      

 7.  Commit Time Everyday to Improving Your Financial Literacy.  How much time will you spend on the internet and watching TV today, this week or this year?  How much time have you invested today, this week or this year improving your financial literacy?   What is more important?   There are countless free resources available on the subject of Financial Literacy.   Remember, we must take full responsibility for our own financial lives.  Simplify this task by working on one subject at a time.  Pick something basic like home budgets, etc. and get started today. Work on this with your spouse, family, friends etc.  Together you will learn more and encourage one another. 

 8.  Create Clear, Concise Financial Goals – This is one of the most important steps in achieving financial freedom.  It is our clearly stated goals that we have committed to writing that will compel us to take action to achieve financial freedom.  Without clearly stated goals we will abandon our financial commitments for the future and only think of our immediate wants and needs.  We cannot afford to waste our precious time, money and resources consuming our future by our lifestyle choices today.  Therefore, it is absolutely essential that you take some time and write out your vision and goals for your finances and life.   You want goals that will inspire you.  Goals that motivate you to achieve financial freedom and live the life you have always imagined living.  For more information on this subject see my previous post.  

 9.   Simplify Your Life – Our worlds are becoming more complex with every passing day.  What is consuming your life, your money and your attention and distracting you from the real things in life that are truly important in your life?  What can you eliminate or give away that will cut your expenses, free up your mind and simplify your life?    

 10.   Practice Generosity – Our lives will not be remembered for how much we earned or how hard we worked.  Our lives will be remembered for how we touched and impacted the lives of others.  Therefore, we should look for more meaningful ways to use our money, time and talents to impact others less fortunate than us.  Generosity creates wealth when we take the focus off our own selfish desires.  It provides us a bigger meaning for our money.  It provides us a purpose that empowers us to take action.   We don’t have to wait to become millionaires to start practicing the concept of generosity.  We can start today. There is always someone less fortunate that us and we can impact their lives.

I hope you have benefited from this post on Financial Literacy.  If so, leave a comment.  In addition, please forward this to anyone you think might benefit from this short lesson on the 10 Keys to Financial Freedom.  

You can follow Fiscal Literacy on Twitter and Facebook.