All Articles Tagged "Personal Finance"

How To Build Your $1K Emergency Fund in 3 Months in Just 4 Steps

December 19th, 2014 - By Kara Stevens
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One of the reasons that financial emergencies become financial disasters is because there are no monies set aside for the urgent and unexpected. If you are looking for a place to start establishing financial security, building an emergency fund is the first step. In fact, having at least $1,000 in your emergency fund can keep your finances afloat as you work on building other areas in your financial life.

Here are the steps to get your emergency fund to $1,000 within three months.

Step 1: Work the numbers

If you want to build your $1K emergency fund in three months, that means, you want to stash away $333.33 every month, $83.33 for 12 weeks, $16.65 Monday through Friday for 60 days, or $11.90 Monday through Sunday for 90 days.

Step 2: Step it Up!

Open an online account specifically for your $1k emergency fund. Here are three online banks if you are looking for some direction:

1.Capital One 360 www.capitalone360.com

2.Ally Bank www.allybank.com

3.Smarty Pig  www.smartypig.com

You can also go to GoBankingRate.com to get some more comparisons. This strategy is especially helpful for folk that like to dip into their accounts for unimportant events. Online accounts take at least two days for you to gain access to money. So, if an emergency comes up and you don’t have access to the money, you can easily put the payment on a credit card and earmark payments from the emergency fund right away.

If financial discipline isn’t your issue, you can maintain a separate emergency fund in your traditional brick and mortar bank.

Step 3: Automate it!

Automate withdrawals for $83.33 weekly from your accounts. If this distribution doesn’t work for you, automate a distribution that makes the most sense for your payment schedule and bills schedule. For example if you get paid on the first and third Fridays of the month, you can stack up the savings that way.

First Friday:  $75

Second Friday:$50

Third Friday: $125

Fourth Friday: $83

Step 4: Monitor and Let it Marinate!

The power of automation is that you take yourself out of the equation. It eliminates you having to remember the who, what, where, when, and how. Also, when you set up automating savings, you are paying yourself first. You can treating your savings like one of those bills that you would never forgo paying like mortgage, electricity, or your car note. This action alone embodies an MIT (Most Important Thing) money mindset: You don’t put yourself last when it comes to building your financial future, you put yourself first. Basically, you are saying, “I am just as important as Verizon, Chase, or Sallie Mae.”

Good luck with starting your financial foundation; it’s easier than you think when you create systems and structures designed for you to succeed.

Connect with Kara @frugalfeminista. Learn more about The Frugal Feminista at www.thefrugalfeminista.com Download her free ebook The 5-Day Financial Reset Plan: Eliminate Debt, Know Your Worth, and Heal Your Relationship with Money in Just 5 Days. Join Kara’s closed $20 Cash Crash Diet Facebook Group to get some sistergirl support and accountability for reaching your savings goals.  

Are You Ready For The New Year? 9 Financial Questions To Ask Yourself

December 17th, 2014 - By Tanvier Peart
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As we close yet another chapter in our lives, many of us look forward to the start of a new year. There’s something special about a clean slate that can give us the hope we need to continue on our paths. The question is whether or not you’re doing the same old routine, or identifying areas you need to change. Here are some financial questions to ask yourself.

Is This One-Sided? 10 Signs You’re In a Financially Messy Relationship

November 21st, 2014 - By Tanvier Peart
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Not all relationships are healthy ones. Whether it’s a love interest or a friendship, at some point, you need to reassess the people you keep in your inner circle. Sure we all bring different things to the table, but please be careful that you aren’t being hit where it hurts. Here are a some signs your relationship is not healthy in the financial department. Unfortunately, this happens all the time.

The Real Reason That You Are Still Broke & In Debt

November 20th, 2014 - By Kara Stevens
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One of the reasons that many of us fail at actualizing our money goals is because they are too big, too broad, and too “pie-in-the-sky.” We set ourselves up for failure when we are not specific about how we REALLY want to improve our current money situation.

You say, “ I want to get out of debt for 2015.” But what does that really mean?

Does “By June 30, 2015, I want to eliminate $2,000 of the debt on my Visa” sound more

Specific,
Measurable,
Attainable,
Realistic, and
Time-bound

than “ I want to be all about my money next year” or “ I want to get out of debt next year?”

If you said, “yes,” then you just learned how to identify a SMART (Specific, Measurable, Attainable, Realistic, and Time-bound) goal. A SMART goal is a nitty-gritty structure that helps you make concrete and specific milestones and touchpoints. In our case, creating SMART goals will give us a starting point, an ending point, and a path of how we are going to demolish our debt.

Let me break it down this SMART goal some more.

The “specific” was “I will eliminate credit card debt on my Visa (as opposed to “all debt”).

The “measureable” is the amount stated: I will eliminate $2,000, not $2,001.01 or $1,999.99. I will be able to measurable how my outstanding balance falls.

The “attainable” and “realistic” go hand-in-hand. Let’s just say this goal was written five months before June 2015. Would it be safe to say that saving $400 per month, $100 per week, $25 per day(Monday through Friday) is attainable and realistic? Many of you could say “yes,” others may say “no”. If “no” is your answer, then you need to adjust either the amount of debt you want to eliminate (and make it less than $2,000) or increase the timeline for doing so. Instead of taking five months to eliminate the debt, you may need to add two more months.

SMART goals makes dreams into concrete realities because they keep you focused and in tune with what you really want.

Now that I have walked you through it, create a debt elimination SMART goal and find an accountability partner, basically a friend that you don’t want to let down and who will keep you in check.

-Decide which debt you want to tackle first.
-Decide how often you will check-in with your accountability partner.

Now that you have a SMART goal for your debt elimination process, you have essentially created a road map for your financial success.

Stoked? I know I am for you.

Connect with Kara @frugalfeminista. Learn more about The Frugal Feminista here. Download her free ebook The 5-Day Financial Reset Plan: Eliminate Debt, Know Your Worth, and Heal Your Relationship with Money in Just 5 Days. Join Kara’s closed $20 Cash Crash Diet Facebook Group to get some sistergirl support and accountability for reaching your savings goals.  

401K Financial Moves To Make In Your 30s

November 14th, 2014 - By Tanvier Peart
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Young professionals have the power to make great strides when it comes to planning for their financial future. The earlier you start to plan, the more you’ll have in your pot. Yet millennials aren’t saving their money. While things like student debt and bills are very real, we must do what we can to make sure we have what we need down the road. Here are some 401k tips for us folks in our 30’s.

Read 10 Mistakes We Need to Stop Making in Our 30’s

Could You Survive A Week On $20? Preparing For A “$20 Cash Crash Diet 5-Day Challenge”

November 14th, 2014 - By Kara Stevens
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I was cleaning out my closet the other day and saw something that, at first glance, I did not recognize. I pulled it out from the mélange of shoe straps and hangers to see what it was.

It was a cognac-colored Coach bag that I bought four years ago that I swore up and down would be that bag—the bag that I would and could rock with anything.

That bag that I would love and cherish and keep for at least 10 years.

Umm… that would be a negative.

Looking at it at the bottom of the closet revealed that I was living a four-year damn lie.

It was apparent that I neither needed the bag nor wanted the bag. It was also apparent that the $460 plus tax that I gave to Coach was far from being well worth the purchase.

So, this closet spelunking got me really thinking about one of the most fundamental precepts of personal finance: knowing the difference between a need and a want.

In fact, the bottom of my closet spoke volumes about how I failed to internalize this concept. So I decided to limit my discretionary spending to no more than $20 next week, Monday through Friday.

I have called it the “$20 Cash Crash Diet 5-Day Challenge.” Here are the rules:

-The $20 Cash Crash Diet 5-Day Challenge will not include the cost of necessities like groceries, hair appointments, and transportation.
-It will include, however, the cost of eating out, impulse buys at convenience stores, manicures, pedicures and online shopping for books, which (as you know) are one of my biggest weaknesses.

So, in preparation for my $20 Cash Crash Diet 5-Day Challenge, here is what I am planning to do:

1.Look at my bookshelf for books that I have yet to read. Going to the library to borrow books is not possible for me because I need to write in my books in order for me to get the most out of my reading experience.

2.Leave my credit cards at home. I’ve been doing this for the past two months and it has worked miracles for curbing my unplanned expenses.

3.Withdraw my $20 bill or in two $10 bills. Having cash makes me want to spend it less. When I actually have fewer bills (one $20 bill vs. 20 single dollar bills), it tricks me into thinking I don’t have that much.

4.Carry tea bags to work with me. One of my biggest unnecessary purchases is the tea that I buy on the way to work. I already have the type of tea that I buy outside in my house. It makes no sense that I am paying probably triple the price for someone else’s hot water.

5.Prepare all of my outfits at the beginning of the week. This helps me gauge when I will have to do laundry.

6.Decide which meals I will have at home. Twenty dollars will give me a little wiggle room to eat out. It just won’t let me eat often or for much. So, the question then becomes, “Which meal is most cost-effective to have at home?”

7.Bring a thermos so I can refill on the water at work. Bottled water is the devil. It siphons your money. Bringing a thermos so I can fill up at work can keep me from frittering away my dollars.

8.Go to bed earlier and stay off of social media and the internet. Nighttime is the hardest for me when it comes to online shopping at Amazon. Figure out your triggers and find ways to work around them.

9.Unsubscribe to my favorite online bath and beauty mail lists. I am addicted to Carol’s Daughter Brown Sugar body scrub. I always wait until it is on sale to buy it, but I know that I can make my own if I really wanted to.

The Cash Crash Diet 5-Day Diet Challenge begins on Monday, November 17th. If you want to challenge yourself, share your setbacks, and triumphs, receive some support from your fellow sistergirl, join my closed $20 Cash Crash Diet Facebook Group.

Kara is a life coach, motivational speaker, author, and founder of The Frugal Feminista. She is also the author of the ebook The 5-Day Financial Reset Plan. You can download it for free here. Connect with Kara @frugalfeminista.

There’s Still Time To Turn Right: 9 Signs You’re Headed For A Financial Disaster

November 7th, 2014 - By Tanvier Peart
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When it comes to your money, how financially savvy are you? Are you someone who knows how to stretch a dollar, or use your very last to enjoy the moment? How you answer can say quite a bit about the state of your personal finances. Take a look at these signs you’re headed for money troubles.

There’s always time to make the necessary changes.

10 Financial Fears & How To Overcome Them

October 31st, 2014 - By Tanvier Peart
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All of us have a fear or something that makes our insides turn. Sometimes we focus too much on simple things that won’t hurt us, while other times we don’t give attention to things that can change our life forever. When it comes to money, do you have any worries? Here are some examples of common financial fears and ways to overcome them.

4 Times Your Next Financial Move Should Come From The Head Instead Of The Heart

October 31st, 2014 - By Kara Stevens
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If money actually grew on trees and humans were 100 percent logical, there would be no need to be particular with how and with whom we spend our money. But since neither of these is true, we have to start thinking with our heads instead of our hearts if we ever want a chance to live without debt.

Here are four times when you need to think with your head when it comes to the world of money and emotion.

When deciding to cosign. If there is one thing that Black folk are known for is our love of family. Helping family can be a good thing as long as it does not make you broke or make them feel entitled to your income flow. If one of your family members asks you to cosign on a loan for a tuition or a car, please know that this is more than throwing a few extra dollars their ways when the end of the month is nearing. Cosigning is a binding agreement where you commit to making payments to a loan in the event that the primary borrower can’t pay. This is an absolute no-no, no matter how much you care for the family member.  Cosigning jeopardizes your financial future for someone that (probably) is already in financial disarray.

When you decide to quit your job to pursue your side hustle full time. Before you go and quit your job to pursue the side hustle that brings you a few coins in a month, be sure that you have enough money to keep all of your money expenses covered for at least six months. If you have yet to stack that set of cash away, kindly smooth out the wrinkles in your skirt and take a seat back at your desk until that item on your to-do list is done.

When confronting a coworker about unprofessionalism. Being assertive is a necessity at work. It sets the tone for how you treat others and how they treat you. With that being said, make sure that you approach a colleague that you are having an issue with after you have collected your thoughts and drafted what you wanted to say. You want to be effective in communicating your wishes and you don’t want to be escorted out of the building by security for turning somebody’s table over.

When saying “yes” to your bridal dress. I know. I know. You have been waiting to be the Princess Bride since you were knee high. And I get that you are uber-happy to either change that last name or hyphenate it. However, this does not justify buying a wedding dress that puts a crater into your credit because you want to feel special. Being solvent is more special. Being able to start and sustain a marriage without debt and financial baggage is the most special.

Connect with Kara @frugalfeminista. Learn more about The Frugal Feminista at www.thefrugalfeminista.com Download her free ebook The 5-Day Financial Reset Plan: Eliminate Debt, Know Your Worth, and Heal Your Relationship with Money in Just 5 Days.

The One Tool That Will Help You Lose Weight & Stop Overspending

October 24th, 2014 - By Kara Stevens
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A few years ago, the American Journal of Preventive Medicine published Kaiser Permanente’s Center for Health Research findings which concluded that keeping a food diary can double an individual’s weight loss effort. Similarly, a study in The New England Journal of Medicine found that those who did not jot down their food intake on a daily basis underestimated their caloric levels by an average of 1,050 calories.

Generally speaking, the act of journaling—the process of reflecting and thinking metacognitively on a particular set of behaviors and decisions— is an excess-management tool that can prove successful for not just overeaters, but for overspenders as well.

Many financial coaches encourage over spenders to keep meticulous notes about their purchases in order to identify patterns in their spending habits, holes in their budgets, and areas for money management improvement. Less attention is often paid to the psycho-emotional triggers that provoke and incite extraordinary consumption.

However, when it comes to embarking on the road to financial recovery, unearthing the why of spending, is just as important as detailing the what of spending.

Here are two areas in your life where journaling will help you improve your finances.

1.Track How You Spend with Your Friends.

Are you a teacher, social worker, or not-for-profit administrator that is expected to spend as freely as your investment banker and corporate lawyer friends at parties, social gatherings, or restaurants?  Are you an “up and coming” young professional with a lot of “starving artists,” “down-on-your-luck” friends that is expected to cover their expenses when it comes to most social outings? Writing down how your financial behaviors shift when dealing with friends will illuminate patterns. This data, if used, can shape your future interactions and money-related dealings with them.

2. Monitor Your Emotional Triggers While Overexposed to Media Antics

The tendency to overspend, like the tendency to overeat, is rooted in our emotions. Despite what people would like to think, money is a matter of the heart and soul. Our belief systems and our learned behaviors from friends and family dictate a lot of our spending habits. But you know what especially drives our consumption? Big ‘ol juicy insecurity! Yes, the fear that we just missed the mark, is not quite as good as (fill in the blank), and are inherently flawed. Overexposure to big business media antics compounds this fear and drives you to spend. Concretely, while watching television, pay close attention to how you feel after you imbibe the lies that media try to extol. Are you insecure about the amount of money that you make? Be cognizant of how you feel about yourself and your financial priorities after watching commercials for luxury vehicles, reality shows that flaunt wealth and fame, or movies that romanticize excess.

Connect with Kara @frugalfeminista. Learn more about The Frugal Feminista at www.thefrugalfeminista.com Download her free ebook The 5-Day Financial Reset Plan: Eliminate Debt, Know Your Worth, and Heal Your Relationship with Money in Just 5 Days.