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When you take a look at how much NOT knowing certain things can cost you, it can really make your skin crawl.  If you’re one of many people struggling with your finances or would like to shave off unnecessary expenses, this post has some tips that you may not have heard of (I hadn’t until I did some research and boy did that initiate a couple of phone calls!)  Take a look for tips on personal financial management, debt and credit cards, savings, relationships and money, as well as coping with the emotional effects that being in debt leave your with.

I believe in the empowerment of self and struggles with money can really challenge that.  For some people, the effects range from a sudden increase in debt, a decrease in confidence, a loss of their home, and many more.  Since every little bit counts, here’s a list of Did-Ya-Knows.

For monetary goodness’ sake - I hope this offers some real help to you and hey, if you have a tip of your own, I encourage you to comment and add your 2 cents to this post.  Screw inflation, it’s worth a lot.

Personal Finance Management

1.  Mint.com 

My absolutely favorite, free find on the net as of late.  Mint.com is a MotleyFool (a very informative, fun website about money) baby and it not only provides great graphs that show you how you’ve been spending over whatever amount of time, it shows you options that will help you save money, let you compare what YOU spend versus the rest of the nation, and sends you alerts based on the budgets you set as well as alien (ok, unusual activity).  It also watches your trends and screams bloody murder if it looks off.  I mean really- its spiffy, efficient, pretty, with lots of colors and features (yeah well- that matters to me too you know).  It also taught me I spent more money at my local drugstore than for the health food in groceries I cringe about every month.  

2.   MyCreditKeeper.com

For $10 a month, it’s a lifesaver on a dime.  Your credit report is a snapshot of how you handle your money.  If you have any real plans to buy a home, open a new business, pay for school, even get a great job, you’re going to have to shine on that thing.  The credit bureaus themselves offer what I feel are pricey options for monitoring your credit reports.  And then, MyCreditKeeper.com came along.  My first month was free, and every month after that was ten bucks a pop.  For that, I received alerts on possible derogatory information, any improvements, WHY my credit might have taken a dip, what I’m doing right, all the scores for all the bureaus, and this cool “What If” feature that I love.  “What if I pay off this and that credit card?” The Answer:  “Your credit score will improve by x points”.  The alerts are amazing especially for watching out for misinformation and nasty surprises for ID thieves.  It’s a great first step if you’ve got some cleaning up to do.

3.  Hidden Fees That Can Pop Out Anytime

Ever been slapped with a yearly fee, two ATM withdrawal fees at once, surprise interest charges that you didn’t know would cost so much until you saw the bottom line, and things like that?  Banks and companies make a fortune off of the unobservant customer (try a collective 17.4 billion on the last count).  It’s NOT just two bucks.  It’s the principle.  AND two bucks.  That all adds up.  Please - learn what fees threaten your financial zen - those suckers grow quietly and quickly too.

4.  Checks and (Overdrawn) Balances

So you already know that overdrawing your bank account is a bad idea.  For most, it means, on average, an unattractive $25 - 35 fee each and every time.  But here’s even more of a reason to cut it out. 

  a)  Banks can totally black-bar you for being the type to overdraw like there is no tomorrow.  You’ll try to go to another bank and attempt to open a new account and discover you’ve been added to a system that told the rest of them to watch out for ya.  Really. 

  b) If you’re the type to overdraw quite often, banks can capitalize on such practices.  They make sure your largest purchase comes out of your account first and your smaller purchases (that wouldn’t have caused you to overdraw) come out one by one after that.  They SAY that it’s done this way because the biggest purchases tend to be the most important ones - like rent or something.  But here’s what happens.  You are sicced with overdraft fees for all of those small purchases as opposed to your one or several large ones.  In my bank, that’s 30 bucks a pop.  In my world, that’s a BIG ouch.

 5.  For the Sake of Your ID, Check What Those Statements Are Stating! 

 A very wise couple once told me (hey Ma and Dad!) to make sure I cut down on my shenanigans and check those statements.  Every month.  See, I am big on not being bothered.  I don’t live for numbers, interest rates don’t make my heart race in excitement, and as long as I’m not overdrawn, have a decent balance in checking and savings, and am on time, I’m good.  I was also wrong.  Apparently identity thieves like to check if someone is paying attention to their accounts online so they’ll charge small amounts and see if they go unnoticed.  A dollar here, two dollars there, and BOOM someone buys a boat (or something) on your name!  Even if you squirm with discomfort of having to face the black and white facts on your statements (paper OR electronic) every month, take a few moments to look over your accounts and make sure you recognize each transaction.  Ignorance isn’t bliss in this case.  It’ll totally cost you.

**  Even better?  Mint.com as well as many financial institutions will alert you at unauthorized or unexpected purchases as well as major changes in your balance if  you sign up for such alerts. 

Debt!

6.  Your Debt and Credit Available Ratio - Are You Worth It? 

So here’s something I didn’t think about.  Suppose you owe $250 on a $300 credit card.  Your credit report will balk because your debt is 83.3% of your available credit.  What will THEY see?  “Whats the problem?  Can’t keep up with your payments?  Lost your job?  Why is it so high?!  Are you worth the risk of lending to?  Doesn’t look like YOU CAN KEEP UP!” 

Ahem.  ‘Scuse me.

Now suppose you owe that same 250 bucks on a $1000 credit card.  You still owe $250 but your only using 25% of your available credit as opposed to the 83.3%.  Those numbers are MUCH better for your score and therefore for you.  So to make sure you’re playing well with your money-

  a)  Call the bank and ask (nicely) if they can raise your credit limit.  Good behavior like paying on time will totally help your cause.

  b)  Ok seriously?  Don’t increase your spending and that ratio will work in your favor.  It’s VERY tempting, I know, but you’re working on improving your life, not digging a deeper hole!

  c)  Keep tabs on your credit cards.  Some of us have to use those cards so pay attention - are you maxing out certain cards and not touching others?  Which ones have higher limits?  Who is beating you over the head with huge interest rates?  Are you paying them on time?  Know what you’re doing when you hand that plastic over.  This strategy will save you even as you spend.

Here’s a tip I found in Suze Orman’s The Money Book for the Young, Fabulous, and Broke;

7.  Savings vs Debt:  Which One Do You Pay Attention to First?

  … Your Debt.  It’s much more important to reduce your debt and get it under control than start a savings account and be responsible for a drowning credit report particularly if the interest on your debt is larger than the interest you earn on your savings.  You’re not technically gaining anything but rather losing the difference in interest (because you have to pay that off and STILL have that debt mountain to climb)

Not only that, the neglected debt tarnishes your name, makes it impossible for you to obtain credit that you may need for the big emergencies you didn’t see coming and was counting on the growing savings to cover. 

Ever thought about having your wages garnished because you just wouldn’t pay a bill or being taken to court?  Think of the drama.  The sooner you rid yourself of the drama, the better.  THEN you can start chipping into your savings.  It may seem counter-intuitive.  But that’s why its a great tip worth sharing.  (And of course, if the interest you earn for your savings is about the same as your debt, then it’s safe to chip in to both if it’ll make you feel safer to have that cash in the bank)

Money for A Rainy Day:  Savings

8.  Everyday Fortunes 

Your daily lunches and coffee breaks, fine (takeout) dining, and other little things add up.  I am not going to say just how much money I ended up spending at drugstores and the drive thru as I am still quite thoroughly horrified but I’ll tell you this!  A small fortune is a terrible thing to waste.  Nip and tuck some of those expensive habits. 

9.  Cost of Living - Does It HAVE to Cost So Much?

 Are you letting the water run when it doesn’t need to be?  Do you unplug electronic devices so that you don’t get charged the ‘phantom charge’ (even when things are off, they use power when plugged in!).  Gas prices are skimming wallets from the top, bottom, AND sides - are you using your car efficiently?  Do you REALLY need all those minutes and the house phone too?  If you paid attention to those crazy fees and stopped them, wouldn’t they look pretty in your savings account?  Does buying in bulk actually save you money?  These are all important questions to ask when you are looking for a way to save some cash.  They may all seem like small things to mind but together, you’ll have ‘discovered’ money.

Credit Cards

10.  Cash Advances are a Step Backwards

   You are MUCH better off using your credit card for whatever it is you need than taking out a cash advance.  The paper money will cost you an average of 20%+ on interest from the very same day you took it out! 

11.  Your Credit Card Balances - Make the Payments You Make COUNT 

If you can, transfer the debt from credit cards with higher interest rates to the ones with lower or zero dollars in interest.  Fact you can’t avoid?  You owe the money;  However paying back, say, $1500 on a 6% interest card ($90) is so much more favorable than the 17% (read:  $255) for the same debt.

12.  Keep that Card You’ve Had For So Long 

It’s tempting to find your nearest axe, hack the plastic, and end accounts when you’re trying to take control of your financial life.  But hear this.  Since credit scores and the reports that rat them out are based on the HISTORY of your credit (and this means everything you do per card, loan, contract, etc), they need to see that you’re not allergic to commitment.  It doesn’t matter if you’re loaded.  It’ll do you so much more good if you can prove you are able to be consistent over a long period of time with your payments than a one time payment the size of a horse.  For all they know, that can mean you hit the jackpot during Bingo night - it doesn’t prove you are trustworthy.  The banks want to know that you’re in this “relationship” for the long haul.

13.  Snowball Payments Will Save You 

If you’ve got several credit cards and debt on all of them - breathe.  Pay the minimum balance on all of them -every single month- and pay off as much as you can one credit card at a time.  As you pay off each card, your FICO score will continue to rise because of your consistency with payments as well as your awesome debt reduction.  Some experts say pay off all the smaller amounts first and get them out of the way.  Others say pay off those with the highest interest first and move down from there, regardless of the balance. 

14.  Click This Link For Credit Card Secrets 

Well, goodness!  This Motley Fool Article entitled Card Tricks will give you the low-down on some of the scrupulous tactics found with some credit cards.  I hate that some of these look familiar.  What’s in YOUR wallet?!   Take a look see! 

Expensive Mistakes

15.  Fine Print Isn’t So Fine Is It 

 You made the jump, transferred your balance to a new credit card, then did it again because one of your new found tips (#11) told you it’s smarter to pay your debt with the lowest interest possible.  Except the credit card company didn’t highlight one FYI in your favor; somewhere in the fine print, it says you will suffer the wrath of a penalty fee for doing such a thing. 

How about signing up for a gym membership, gung-ho about getting super-fit, then your job increases your hours and since you are required to oblige, you just want to cancel the membership?  Did you make sure you understood that a two-year membership that can’t be cancelled unless you are deathly ill or are moving 25 miles or more away from it were your only ways out?  Oh wait - what’s that?  You moved 23 miles away?  Doesn’t matter.  That’s more fine print that will cost you a lot and if you refuse to pay up, your FICO score will take a hit.   

Whatever you do - be an informed consumer.  Not only for the sneaky things but also for the sake of value.  Is it really cheaper to skimp on the quality of certain items and be forced to buy again and again?  It really hurts to be forced to pay when you wouldn’t have if only you knew. 

16.  Watch Out For Those Emotionally Charge Financial Decisions 

From avoiding grocery shopping while you’re starving to loaning your hot new boyfriend money again and again because you ‘understand him and his struggles’, be very mindful of the amazing impact your emotions have on your financial decisions.  If you’re too nice to say no, next thing you know you’ve paid for something you truly didn’t want because you felt obligated.  If you are dealing with crisis (take a look at my horror story in tip #18), you are feeling vulnerable and people prey on you.  You may feel like you’re in a panic and spend on impulse.  Some of the biggest financial mistakes come from emotionally charged decisions.  Be in touch with yourself and therefore, in touch with your wallet.

LIES!  LIES!! ALL LIES!!!

17.  You HAVE to Deal with the Harrassment of Debt Collectors.  NOT.  

I remember how I felt when my ex’s overdue credit card debt caused a guy at a collection agency to call our home.  Over and over and over again.  Even though we spoke to him the day before.  He started to become incredibly abusive; I’m talking statements like “So what - you’re poor?  You’re an idiot for having this debt!  We will RUIN you!  Borrow the money from a loan shark or something!”  Yes, this is a true story so yes, I’m serious.  To make matter worse, he often called from a private number even though we had written down what company he was working for and who he was from the very beginning.  It didn’t seem normal and looking into it - it wasn’t.  Apparently, if you contact the agency in writing requesting that they cease the phone calls, they have to.  They get to contact you at least one more time to let you know what their intentions are but they can’t threaten or abuse you.  You get to report that sort of bad conduct and they WILL be liable.  They also can’t call you at work if it’s not something that is permitted. 

Debt collectors have a job to do but there are lines that shouldn’t be crossed - so know your rights!  Click the heading of this tip for a link to a page that beautifully tips you off on the methods for collections and your rights.

18.  “No, no!  You have an extra $500 in the bank!  *snicker*  WE LIED.” 

It can SEEM like you have more money than you actually have in your bank account.  That’s because some banks automatically add the amount of the overdraft protection in your balance when you check the ATM or your account online.  So you go off on your merry way, spend $150.73 when you actually have $100.08 because it SAID you had $300 and get to chew on a overdraft fee for it.  Nice.

19.  Those Contracts For Big Ticket Purchases?  Check Them Thrice! 

Ready for a quick horror story?  Yeah - so I went to buy my car at an emotionally distraught time in my life.  I was in a new town (I’m from the City so imagine my horror when I learned I’d be forced to drive).  I had no one to vouch for me so I did my best for that time.  I did the Blue Book check, I knew the price ranges, and I took the names of the guys that I spoke to when buying my brand new car.

Somehow in between all the add-on razzle dazzle and small talk, I had an extra $15,000 added to the ticket price of my vehicle without my consent.  To this day I cannot recall seeing that number when I signed.  Was it a blank contract?  (”Yeahhhh just sign here - we’ll take care of everything!  Don’t you worry - you’re going to such a rough time.  God bless our service men and women!”)  When I discovered this huge extra amount a few days later, I went back and asked the guy who signed me up about it; he told me that the bank had added all of the interest on the loan upfront.  Since that didn’t sound right, I call the bank and of course, it was a lie.  I was together enough to know that we confirmed the ticket price verbally over and over - so boy was I mad.

Let’s just say after handling it under threats of public humiliation in a cold and icy tone, I got my money back and then some.  The manager who at first hid from me apologized profusely for his employee (who no longer works there - I wonder why!)  However, many people are not that lucky.  When you’re going to sign a contract, seriously, don’t allow people to distract you from the fine print.  Take it home; look it over one, two, three times if you have to.  Go to someone who knows.  Make friends with customer service and get your questions answered.  Because yes - some people lie.  Boo to them.

Relationships and Money

20.  When Friends Need to Borrow Money 

This link will bring you to another post I wrote.  The general gist of it is there are going to be those times when someone you love may come tap your shoulder for some cash.  Maybe more than some.  If you’re going to take the leap, be sure to secure your ground with a simple notarized agreement.  Many friendships, relationships, etc. don’t survive the neglect of returning funds.  Other situations breed a quiet resentment.  You really love this person?  Keep ‘em in your life by drawing clear lines. 

21.  What Money Habits Say About Your Partner (Or You!) 

One grand mismatch between two lovebirds is their opposing attitudes towards money.  One may be a big spender while the other is a scrimper.  One may try to hide what he/she does with the money that comes in the house.  One may take great responsibilities down to the dime while the other couldn’t care less.  Alot of these little things project a huge image of the person’s integrity - with money as well as many other aspects in life.  The wonderful news is good habits can be learned but it won’t begin from a place of dishonesty or angry resentment.  If you’re getting into it with someone new, know where you both stand.  If you’ve been together and this is a source of your stress, you can afford getting to really know each other financially.  Let that piggy back the love and mutual respect that every healthy relationship has. 

22.  His (Or Her) Great Credit Won’t Help You Anymore 

Once upon a time, if you’re spouse had awesome credit and added you as an authorized user or made it a joint account, you would have been touched by the golden hand of FICO and your credit score would have increased.  Unfortunately because of sneaky practices that ended up causing the banks to lose out on money, this is no longer something you get to enjoy.  In other words, you’re on your lonesome; your honey can’t fix this one this way anymore.

Emotional Taxation

23.  You Manage Money, Money Doesn’t Manage You 

One of the greatest challenges with money thing is the impact it has on your life when debt starts to snowball out of control.  The shame, the changes you’re forced to make, having to manage money for the first time and have it not go so well..

Educate yourself and see that YOU manage money, MONEY does not manage you.  By improving the type of choices you make, one step at a time, not only will you reduce your stress, you’ll get back on track no matter how deep of a hole you dug yourself into.  Sure it will take time, but that beats never, right?

24:  How Exactly Do You Get Control?

  One of the people that teach me the most would be customer service.  Since I have absolutely no qualms about asking questions (*insert sweet smile here*), I sock it to ‘em and because my bank cares about the quality of service, not only do I find them quite knowledgeable, they are usually friendly too.  Then there’s the guy at the local bank who will break things down to the letter for me.  I check out the magazines, read great money blogs, pay attention to the financial disasters that happen to others and try to learn from their mistakes, browse the bookstores and freeload (I skim!  For a long time!).  I use the software and online banking things I need to keep up with what’s going on.  When I devise a plan from my new found information, I keep track and pay attention.  As long as I stick to a good plan, I am pleased with the results - always more so than I expected.  Why?  Because it means I’m doing something about the problem.  What are the odds that someone is going to fix them for me?  I am not a woman with such delusions - rather, I’ve learned that expensive mistakes happen.  They don’t need to be habits.  I have a say where my financial life is going.  Regardless of the past - so do you.

25.  The Pulse on Impulse Shopping 

For some, the fresh new scent of brand new shoes dulls the pain of what that son of a gun said the other day.  Gorgeous accessories, things for the house, toiletries and makeup (GUILTY!) that always seem like the MUST-HAVE for reducing stress are all so very appealing.  After all, with all the big bucks that go into marketing to us women - things just smell so nice and life is on hold when shopping your troubles away.

But ok - perhaps the impulse shopping made this post necessary for you to read from top to bottom in the first place.  Another thing - the compulsion costs you something big.  Your sense of self control.  Impulse shopping hurts some relationships and bankrupts others.  The sense of value you feel have been added with your latest super expense is false and short lived.  You end up feeling empty and look to fill that void - with a new pair of shoes.

Know that it’s a real problem.  Know that your growing with your personal development includes finding other sources (not to mention free ones) that will help you feel that content that you need.  Know that you can’t buy your happiness.  Know that you’re worth it to invest in yourself.  You’ll enjoy the greatest return of all.

Whew!

I can’t end this without sharing some awesome blogs and their useful posts that just may help your cause!

-  FrugalDad.com:  How to Survive a Company Layoff

-  MySuperChargedLife.com:  Be Wise With Your Economic Stimulus Tax Rebate

-  FiveCentNickel.com:  Financial Infidelity  

-  SavingAdvice.com:  Personal Finance Isn’t Just About the Money 

-  PaidTwice.com:  Snowflaking - A Primer   

For some really good books worth a look, here are some *links:

Financial Peace: Restoring Financial Hope to You and Your Family

The Money Book for the Young, Fabulous & Broke

Women & Money: Owning the Power to Control Your Destiny

On My Own Two Feet: A Modern Girl’s Guide to Personal Finance

Make Money, Not Excuses: Wake Up, Take Charge, and Overcome Your Financial Fears Forever
 

The (Help Us All Save) Million Dollar Question:

Do YOU have any tips that has saved you (or could have if you had known) money? Do share your wealth of knowlege guys!

Photos by:  TIO, nickwheeleroz, Lucee.

*  Links contain InMyHeels affiliate ID

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