March 26, 2015
How to Budget – 5 Easy Steps
Due to the ever increasing lifestyles that we lead, it is sometimes important to become a little frugal, and follow budgets. Following a budget can help in purchasing some dream object, which has been on our priority list. Well, we give below budgeting 5 easy steps, which can make you a frugal spender. It is very important to have a control on how much we spend, as compared to how much we earn. Some percentage of the total income should be saved so that you get closer to your dream:
Budgeting – 5 Easy Steps
- Evaluate the income: What is the income that you are earning? Create an excel file with all the sources of income, and enter the interest rates, rental income, and any other income.
- Calculate the expenses: Well, this is a difficult part. While we can track our income sources, expenses come in many forms. So, jot down all the fixed expenses that you incur every month. These would include car loan payments, rent, insurance policies, school fees, and other things. After that, include the variable expenses, like gas, food, entertainment, etc. Also, include other expenses, like car maintenance, gifts, taxes, and other things. Once you have the hang of your total expense, deduct it from the total income. This will give an alert to you about whether you are on an overspending spree, or a thrifty spender. It will also give you an idea about where you can cut down the expenses.
- Avoid wasteful expenditure: When you get a hang of your expenses, you can cut down wherever you can. It would be good to analyse and categorize the expenses into necessities and luxuries. Of course, you cannot avoid the necessities, but can definitely cut down on the luxuries.
- Have a good savings in your account: The job scene is quite unpredictable these days. So, one should save enough money to tide through the difficult times. If you have a good amount of money in your savings account, you would be able to get through the difficult period, even when you are switching jobs.
- Stick to your budget: This is easier said than done. But, when one looks at the big picture and the future rewards, this becomes an easier task.
Following these budgeting 5 easy steps will ensure that you lead a comfortable life, and are prepared to face all future calamities, as well.
March 6, 2015
Prepaid Credit Cards (Secured Credit Cards):
There are basically two kinds of credit cards available for the people, who have a bad credit. These are the prepaid cards and the secured credit cards. So, if you have a bad credit history, and require a credit card for yourself, you can check out both the cards.
Some Information on Prepaid and Secured Credit Cards
Both these cards are separate and are not to be mixed. While, both these cards require money to be deposited prior to using them, they are quite different from each other in all the other aspects. For getting the secured credit card, one will need to make security deposits against credit limits, so that the card can be approved. This security deposit is kept in the savings account, and will be used when there is a default on payment on the credit card. The purchases that are made with these cards will go against the revolving credit limit. When the credit card balance is paid off, the available credit increases again. The security deposit is there on these cards because of the bad credit history of the borrower.
Prepaid cards work in a different way. These are actually not credit cards, as there is not credit limit. The deposit made on the card goes straight into the account, and when the card is swiped for purchases, the balance is deducted directly. So, when the deposit is spent, one would have to redeposit the money, so that he can start spending again.
The fees on these two cards vary. The fees on the secured card is quite similar to that of credit card, with application and annual fees, late fees, and finance charges. Some of these fees can actually be avoided if the card is used responsibly. The fees on the prepaid cards depend upon the card that you choose. It could have monthly maintenance fees, activation fees, etc. Other than that, fees might have to be paid for reloading the money, and withdrawing the money from ATM.
So, the choice of the card is totally dependent on you. If you wish to improve the credit score, you should go for the secured credit card. These cards can be converted into unsecured cards after the completion of 12 or 18 monthly payments. And, for people, who wish to avoid the banks, can choose to go for the prepaid cards. These are also good for the students and teenagers, who get monthly allowance from the parents.
These cards can be a great way to make your payments and, if they report to the credit bureaus, build your good car credit.