Take This Money and Stuff It by Terry Clark - HTML preview

What if you took that $246 a month and invested it in, for example, mutual funds?

 

If you could get a return of 10% p.a., after 20 years you would have $186 804. With inflation at 3%, that would be worth $102 597 in today's money.

 

Why would the banks recommend that you pay off your mortgage quickly? Surely the longer the income stream lasts, the better?

 

The banks love being able to prove that their recommendations will 'save you money'. But in reality, the banks do understand the time value of money. They know the true value of that extra $246 a month that you're giving them now, not in the future. And the shorter the time you take to repay the mortgage, the lower their risk, and the sooner their money comes back to them to be loaned out again.

 

There are some arguments for paying your mortgage back quickly - for one thing, the quicker you pay, the quicker your equity grows. But you should understand that every dollar you give the bank now is a dollar that you can't invest.

 

Giving your money to the bank to avoid paying 5% interest means that you can't use that money to earn 10% or 12% or 15% somewhere else.

 

 

Making The Most Of Hard Times

 

If you are struggling to make ends meet, start making plans today to overcome possible problems tomorrow. Making the most of hard times means being as prepared as possible for any circumstances that come your way.

 

Food prices are skyrocketing. Gasoline is going higher every week, sometimes every day. Foreclosures are up. There are many more expenses climbing at rates never seen before.

 

It is time to start planning for changing times. Those who have a plan and have prepared, even a little, will have an easier time than those who just go with the flow until it is too late.

 

What type of plan can you make? What can you do today to prepare for tomorrow. Traditionally, people have been told to save money. Often 10% of your income is the amount you hear to save. When you are having trouble paying the bills, it is hard to start saving $1.00 much less 10% of what you earn.

 

Most people find themselves in trouble before they know what is happening. They get laid off or down sized. Sometimes someone gets ill or hurt and cannot work. The causes of trouble are numerous, but with some well laid out plans you could avert some of the disasters you see others encountering.

 

To start make a list of all of your expenses. The obvious ones like rent, utilities, gasoline and groceries are easy. The hidden ones like money spent on sodas at work or coffee at the local kiosk also add up. Figure out what you spend.

 

Plan to cut expenses wherever you can and lower expenses in other areas. Totally eliminating something often saves a lot of money. Cutting back may save even more.

 

Cut back on the cuts of meat you buy. Cut out expensive snacks and substitute healthier fruits and vegetables. This article is about is getting you thinking today and preparing for tomorrow.

 

Do you drive a large vehicle? Could you pay the payments on a smaller car with the savings it would give you on gasoline? 28 to 35 miles per gallon instead of 8 to 15 MPG might save you from problems.

 

A recent article said the older Geo Metro was getting close to 45 miles per gallon of gas. Could you downgrade to a clunker for most of your driving?

 

Carpooling was a big push back when gas was well under $2.00 a gallon. Maybe it is time to find two or three people to carpool with.

 

Go online and search for “frugal living” or “money saving ideas”. Start now to prepare for tighter times tomorrow.

 

If your house is in foreclosure, it is too late to start saving to protect your investment. Today is the time to start planning on how to get through and maybe even thrive as prices go higher all around you.

 

Finally, if you see problems in your future, think of getting a second, part time job. Two to six extra hours a day may mean you are tired for a while, but it also may mean you have time to get the answers you need to make life better for yourself and your family.

 

 

How Small Businesses Waste Money

 

Most business owners subscribe to the thought that you "must spend money to make money". This can be true, but you also must know exactly where that money is going and the results it brings. A small business owner never has any money to waste.

 

Some ways that your business might waste money includes the following:

 

1. Manage your credit cards - If you have several cards, develop a computer program that will show you the exact balances, due dates, and the interest rate you are paying. Always be aware of other solicitations that save you money and possibly change your balances over to a new company. If you have any employee cards, see if you can set a limit on them. If not with the credit card company, make sure that the employees know their limits. Manage your credit cards wisely and never, ever miss a due date.

 

2. Develop an annual plan so you know where you will spend money. This helps you in several ways. The business person will be aware of what portion of the profits are going to advertising, towards incentives, towards accounting and other internal expenses, etc.

 

3. Do not over-purchase any products or services for a business. If you buy in bulk, the money is tied up and a place must be provided to keep the extras. That might be an unnecessary expense.

 

4. Developing an advertising budget and knowing just what resources to use is key to keeping money under control in a small business. You must advertise, but you also must get value for your money or you will soon be out of business. Keep a record of how much is spent, can you get payment terms, when is the most efficient time to advertise your particular product or service to get the most value for the dollar. Every dollar must be accounted for in advertising because the lifeline of your business depends on new and paying customers. Advertising is the way to get the word out to the community or the Internet.

 

5. A small business owner will sometimes be under self-induced stress to manage all aspects of the business. Sometimes, leaving the control and decisions to others that are qualified is the best way to manage the business. Releasing control may be hard to do sometimes, but in a lot of businesses, money can be wasted because the owner cannot possibly be as efficient as the person who has studied or is knowledgeable about a particular field. For instance, if a business owner does not know accounting, many mistakes in reporting income and taxes can be made. A qualified accountant can possibly save more than the cost of their services in reduced taxes.

 

Take a hard look around your business and do not let anything be set in stone if saving money is the goal. Challenge everything that will cost money and see what can be done to change the situation. Any money that is saved is money that can be put back into the business either in profits or in growth.

 

A business owner wants their business to be successful and will work hard to sustain growth. A business owner wants a way to continue making and growing money from a product or service that is interesting to them. After growing a business and being smart with cash flow, many business owners will sell their businesses only to start another business.

 

The reason is that business owners are independent types and challenges are rewarding when met and faced. Saving money through every day operations will help the business owner to meet their financial and emotional goals.

 

 

Save Money and Energy With an Efficient Toilet

 

The cost for nearly everything we buy is rising and many homeowners are looking for ways to lower their monthly utility bills.

 

Utility services take a big chunk out of many household budgets. The good news is that there are many ways to lower your utility bills. You just need to take action and look for areas in your home where you can reduce costs.

 

 

When it's time for repair consideration should be given to the age of the toilet. Often times it is better to replace an older toilet with a new energy efficient model. Newer models save water and you will not be flushing your hard earned money down the drain.

 

When it comes to deciding whether to replace a toilet or keep the old one, resist the urge to take the advice of well meaning friends and family. Many people think that placing a brick in the toilet is an energy saving measure. This is simply not true. New toilets are designed to require less water to flush. Placing a brick in the tank makes the toilet less efficient and often more water is required to flush solids through. Add to that the damage to the plumbing from the bricks when they corrode, and you can end up with a major repair bill. This is not recommended as a way to save money and water.

 

One best way to save money and energy with your toilet is to choose one of the new energy efficient models. There are many options available to homeowners when replacing a toilet. Knowing what options are available can also help you save money. The choices in toilets can be overwhelming, as there are so many choices available. Some toilets are very expensive and luxurious, and are like decorative art for your bathroom, and others are a very basic design.

 

Bear in mind that high cost does not necessarily mean more energy efficiency. The features of the toilet determines how efficient a toilet is and how much it can lower your water bills.

 

It is always a good idea to do some research before you purchase a toilet. Always check to see if the company you are considering, manufacturers energy saving products. The efficiency rating of the toilet should be available where you purchase the toilet. Often a salesperson can show you the features of the toilet so you can make an informed decision.

 

In the United States there is a federal law that requires a manufacturer to adhere to certain specifications for efficiency and the materials used in the toilets. Use these specifications to make your decision as to which toilet to purchase.

 

The most popular cost effective toilet to purchase today is one that uses 1.6 gallons of water per flush. To save even more, there are some models that use even less water. Choose a toilet with a small storage tank as these use less water. A small storage tank is a much better way to save money on your utility bills, not the old brick-in-the-tank trick.

 

Also available are toilets that are dual flushing models. These types are good choices when choosing a toilet. One handle is used when minimal flushing is needed. A second handle, which is still energy efficient, uses more water when sold waste needs to be flushed.

 

Replacing an old toilet is always a wise decision. Replacing that old toilet with a highly efficient one is an even wiser decision, and will result in lower utility bills.

 

While you are doing your research, be sure to check to see if your community allows a tax break for installing an energy efficient appliance. That would certainly help your utility bill.

 

 

7 Ways to Change Undesirable Spending Habits

 

Many people dream of retiring with a healthy bank account but few people actually achieve it. This is largely due to lack of discipline in building up their retirement fund and poor spending habits. While building a retirement fund requires time, you can accelerate the process by making incremental but positive changes in your spending habits.

 

Here are seven ways that you can change your daily lifestyle for more positive results in your spending habits:

 

1. Do more walking than driving. If you can reach your destination within ten minutes by car, consider leaving the car behind and walk instead. You will save money on gasoline and parking fees. This can easily add up to a few thousand dollars a year.

 

2. Use a bicycle if the destination is within 30 minutes by car. This helps promote blood circulation in your body and also reduces environmental pollution. You can also save on gasoline and parking fees.

 

3. Bring your own coffee to office. Many people like to drop by a Starbucks or similar coffee outlet and end up spending a few dollars or more on a cup of coffee. You can potentially save many dollars dollars each week just by making your own coffee at home and bringing it to your work place in a Thermos. Besides, who knows, it may taste better than the coffee from Starbucks! If you really cannot live without Starbucks coffee, consider getting a Starbucks rebate card. You can use the rebates to redeem free Starbucks coffee after you have accumulated enough points.

 

4. Dine at home more frequently. You can experiment with different recipes and save some money at the same time. In addition, you are honing your cooking skills and this could be very useful for the home dining experience.

 

5. If you are a smoker, start reducing the number of cigarettes you smoke each day. Over time, you may be able to quit smoking completely. Besides saving money by not buying any more cigarettes, your health will also improve and this means a huge saving in your medical bills.

 

6. Have you ever noticed how much time you spend sitting in front of the television? The longer you sit, the worse it is for your blood circulation. Besides, the time you free up can be used for more useful tasks such as teaching your kids or learning a new skill.

 

7. If you are an avid reader, use the public library whenever possible. There is no need to buy the latest books from bookstores like Borders unless it is in a category that does not fit into a public library. The public library will usually acquire popular titles after some times. Learn to be patient.

 

These seven ways are a good start for changing unhealthy spending habits. However, you should continue to research and incorporate more healthy habits that contribute to the building of your retirement fund. By re-investing the money saved from using these tips, you will be many steps ahead of your peers and closer to your retirement goals.

 

 

Kill Your Credit Cards

 

Credit cards are kind of a drag once you get over the novelty of having one or more. By that time you are at your credit limit. Now instead of spending at a shopping spree, you are struggling to make the minimum payments every month.

 

Now you are also wondering why the balance keeps going up even though you are not using the credit cards to buy anything anymore. Not that you do not want to buy stuff with your credit cards, but when you try they come up declined.

 

The reason your balance is getting bigger is because you are being charged an exorbitant interest rate on your credit card balance, and then interest on the interest, plus any of the various fees you might be getting charged. You are in debt and you need to get out!

 

High credit card balances are bad because you are paying outgoing interest that puts a hole in your finances. What you should have is incoming interest to build your savings. This is hard to do when you do not have any savings, and harder to do when debt is giving your money an outflow rather than an inflow.

 

Ever wonder why the poor get poorer while the rich keep getting richer. It is because the rich are collecting interest on the money they have and the poor are paying interest on the money they do not have. The first thing you have to do to move from poor to rich is to stop having to pay interest. Scrimp, budget, and sacrifice. Anything you can do to pay down on your credit cards to get you out of the downward spiral.

 

Once you get them paid, close the accounts because we have an almost certain inevitable tendency to use our full credit balances when we have them available. That is why credit card debt is so common, and why credit card companies are making such good money. Do not let them make it from you anymore. Kill your credit cards! If you need to use credit cards to make payments, banks and credit unions now have debit-charge cards available that are linked to checking accounts so that you do not have to borrow money or get charged interest to pay bills.

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