Unclaimed Money

Communication is vital to keeping relationships healthy. Keeping both parties informed eliminates uncertainty and doubt in the relationship. It keeps you on the same page, and moving in the same direction. This is true not only in your personal relationships, but in your relationships with your creditors.

Your creditors will keep you informed. They will communicate with you when you’ve missed a payment. They are sure to tell you that there has been a change in terms. They will give you a pat on the back, in the form of a credit increase when they are happy with you. They will offer you access checks and other services to entice you to deepen your relationship with them. They sometimes will communicate with you too much, and just don’t take the hint you’re not interested.

Often though the conversation is a bit one sided, and with your creditors, that is fine if things are going well. If you are happy with the relationship as it is, you are keeping up your end by paying on time, and have no interest in their enticing offers, there is no need to respond to their multitude of communications. If you can’t make your payments, if you’ve missed a payment, or just aren’t happy with the interest rate or other terms make a phone call. In many cases you will be able to come up with a solution that is acceptable to you and to your creditor.

If you are struggling, you need to call your creditors, and make some arrangements. They want to know that you intend to pay them. They are willing to work with you, but they can’t if you don’t first communicate with them, or at least respond when they communicate with you. Opening up the line of communication can save you hundreds of dollars in interest and late fees. It also can help protect your credit rating.

Communication is important in any relationship. The relationship with your creditors is no different. Keep the relationship healthy by letting them know if you are having problems, and taking the opportunity to come up with a solution.

In this world geared to instant gratification, patience can be hard to come by. We have the world at our fingertips, and it tells us that we can have what we want now. In most cases exercising patience works to our benefit. Patience, after all, is a virtue, and this is especially true when it comes to our finances.

When I look back at our financial history I see many purchases that were made impulsively. Most of those impulsive buys were made with credit cards. Some of those items seemed like deals to good to pass on at the time. When we were unable to pay the balance of the credit card at the end of the month, the interest charges made those good deals quite expensive.

Some of our impulse purchases were things we convinced ourselves we deserved. We worked hard, and lived frugally most of the year. Didn’t we deserved that three day cruise that we got the good price on? The plain and simple fact was that these items were beyond our means.

Some of these impulse purchases were things we really did need, but maybe did not need right this minute. These purchases were not planned for, nor were they well researched. Taking the time to plan (and save) ahead, and to find the best deal could have saved us a lot of money.

Over the years we have learned to be patient when it comes to our finances and purchases. Things still come up, and we still are tempted to buy impulsively, but where we have exercised patience we have consistently seen three results.

The desire goes away.
Sometimes in the heat of a moment you can convince yourself that you really need something or that a particular item is too good of a deal to pass up. Waiting often shows you that you truly do not need the item, or that the deal really isn’t that good.

One example from our life is our computer. Our computer is old, and a few months ago I was really frustrated by it. I had myself convinced I needed a new one. I went to a local store, and started picking one out. Then I went home to think about it. I am still using the old one. A new one would be nice, but there really isn’t room in the budget, and this one really is adequate.

You find a better deal.
Knowing that you want (or need) to make a purchase, but choosing to wait gives you time to research, and find the best deal. Often, by waiting, we have found the items we were wanting to buy used at a fraction of the cost. In the best cases we have found free items to fit our needs on Freecycle or from acquaintances.

The latest example of this in our lives is bunk beds for the kids. We have four kids; two boys and two girls. They share rooms. We had one set of bunk beds. The youngest two were in a crib and toddler bed. Several months ago we realized that we were going to need another set of bunk beds soon. A few weeks ago my husband’s co-worker mentioned his daughter wanted to give away a set of bunk beds. Score! Now we have a second set, and only need to purchase mattresses.

You find an alternative.
Sometimes when there is a need or want patience breeds creativity, and you find another item that will serve the purpose for less money.

Recently, our microwave died. It was the third one in as many years. I really was ready to go out and buy another one, but wrote about my frustrations at another place. I was surprised by the responses I got from people who do without a microwave. They offered alternatives to some of my most common uses for our microwave. I decided to wait on that purchase. I have found that those alternatives really are almost as convenient, and have decided not to buy a microwave, for now anyway.

Patience really is a frugal virtue, and I hope that the examples above have helped show that. So, how do you develop patience in this world of instant gratification? Here are some things that have worked for us:

Look to the future.
Many times you can see upcoming needs. Prepare for them now by saving money and researching now.

Impose a waiting rule.
If you really want to buy something self impose a three day rule, or whatever time period you feel is sufficient.

Cash only.
Don’t carry your credit cards. Then you can only buy what you can pay for.

Make it a team effort.
If you are married, hopefully, this is something you and your spouse are doing together. If you are single you can partner up with a like minded friend or family to encourage each other in your frugal endeavors, or start a blog. It really does help keep you accountable.

Instant gratification may be the way of the world, but it really is not the best way for your finances. Patience is a frugal virtue. Developing and exercising patience will save you money, and help you to reach the financial goals that are most important to you.

Ah February, and the cabin fever has set in. The holidays are well behind us, and even the groundhogs can’t decide if spring will be here soon or not. It is the perfect scenario for the winter doldrums. A break in the routine is called for, but you don’t want to break your budget. Here are some ideas:

1. Head to the library.
Check out a juicy book, or a movie. It is free!

2. Look for free days at the museum.
If they don’t have free days, consider a membership. They usually pay for themselves in a couple of visits, and you will have an activity to do year round!

3. Go play outside.
Really! Pick a sunny day, and go play, even if there is snow. Go sledding with the kids, take a walk, or go ice skating. The fresh air and sunshine will be truly invigorating!

4. Do it yourself spa.
Take some time alone, or maybe with a friend, and do your nails, color your hair, or something else that makes you feel pampered and pretty.

5. Learn something new.
Always wanted to learn a craft or a skill. Take the time now, when life tends to be a little slower.

6. Don’t go window shopping.
Unless you have a lot of will power, don’t tempt yourself. At worst you’ll come home with a lot of stuff you don’t need. At the least you will find things you wish you could buy, and be frustrated because you can’t.

7. Enjoy nature, from the house.
Put out a bird feeder near a window. Get a field guide from the library, and keep track of how many birds come to your feeder.

8. Turn off the T.V.
Resist the temptation to just veg in front of the tube in the winter. There isn’t much good on anyhow. Break out the cards or a board game, and enjoy something that makes you use your brain.

9. Connect with family and friends.
Pick up the phone, type an email, or write a letter to someone you haven’t connected with for a long time. If possible you could even go visit. Nothing beats the doldrums like rehashing the good old days with an old friend.

10. De-clutter.
It may not sound like the most exciting option, but you will feel good when it is done. Clean out that closet. Rearrange a room. Organize your desk. Sell things you don’t need anymore on eBay, or donate them to charity. It is a win-win!

Don’t let February leave you with the winter doldrums. Spring really will be here soon, and until then you have plenty of things to keep you active while keeping to your budget.

It doesn’t happen often, but sometimes we find, or are given cash we didn’t know we had. Maybe you find five dollars in your jeans from last week. Maybe you get $20 on an instant lottery ticket. No matter the source, unexpected cash is always welcomed, and small amounts like this usually get tucked into your wallet and used for your normal everyday things.

What do you do though when you get a larger sum unexpectedly? Getting an unexpected larger sum is even less common, but it does happen. Perhaps you receive an inheritance you weren’t expecting, get a bonus from your place of employment, or a stock you own has suddenly doubled in worth. If you are an United States tax payer, a nice unexpected sum may be coming your way.

The plan is to put a tidy sum in your pocket in the form of a tax rebate. You are then supposed to go out and spend it to jump start the economy. Should you co-operate with this plan? Well, of course that is a personal decision, but in my opinion the answer is maybe.

I have a great aunt who occasionally will slip me a  handful of twenties, and say, “Go do something fun.” In those rare instances I do go spend the money on something that would not be in my normal budget plan. I obviously do not have the same relationship with the government as I do with my great aunt, and therefore do not feel as inclined to follow their wishes for how I use the money.

When a nice sum of unexpected money comes your way it should be used to meet the financial goals you already have. If you’ve been saving for a house down payment, then a tax rebate will be a nice jump start to that process. If you building an emergency, college, or retirement fund put your unexpected cash into that fund. Trying to pay off debt? Use the money toward that. If you’ve been planning to buy a large screen T.V., then you may be able to it sooner than planned.

Getting some extra cash should not be an excuse to blow through the money leaving you no better off than before you received the money.  Unexpected cash should be treated as a boost to the financial goals you already have established.

Thanks to Melissa whose post Recession Fears = Flat Screen TV?  was the inspiration for this post.

The new year is almost upon us, and as tradition holds it is a good time to reflect on the past year, and plan for the coming year. Many of us right down a lengthy list of resolutions to make our lives better. Most of us do not hold to those resolutions through the month of January, and quickly slip back into our old routines.

Reflecting and making goals are valuable tools. Many of us fail to meet keep to our resolutions because our goals are too broad, and there are too many. This year, as you consider your financial life, put an action plan behind those broad goals.

Saving money and creating a small emergency fund is a worthwhile  goal, but how will you get there? Decide how much you would like to save. If you have debt to pay off, many would recommend that your emergency fund stay small; one or two thousand dollars. Set an amount that you feel comfortable with.

How will you get there? Look at your spending. Where could you trim and save money? Could you make your coffee at home? Pack your lunch for work? Eat out less? Carpool? Decide where you are willing to trim the budget,  how much it will save you, and purpose to do it. To be sure that the money gets to the savings account set up an automatic withdrawal from your checking to savings,  or deposit a set amount yourself on payday.

Of course this is only one example, but the point is to put some meat on those New Year’s Goals. If you truly want to make changes in the coming year think carefully about your goals and make a plan that will help you meet them. If you have several changes in your financial life you’d like to make, I suggest implementing the changes one at a time. Making change gradually will help you make them a habit.

What To Consider Before Filing

Some people think of bankruptcy as an easy way to offload a crushing debt burden, and it’s sometimes the first method they reach for. Well, it may well relieve the burden, but it’s far from easy and should be the very last thing you use to do so.

Yes, it is the end of July, summer is over half through and I am telling you now is the time to hit the stores for your summer items, for next year that is. Take a look at the families closets. How do the summer clothes look? Are they worn out or too small? Will they make it through another season? Start of a list of things that you may need for next summer.

Don’t stop with the closets though. Think about other summer items that you may want to buy for next summer. Maybe patio furniture, pool toys or camping equipment are on your “want” list. This is the time to shop for these items.

Retailers are gearing up to move out the summer merchandise. It is back to school time in the retail world and they need room for that merchandise. They are drastically marking down summer merchandise already. Here is where you can save big by buying for next year.

This is not only true for new merchandise. If you are a thrift or consignment store shopper, like I am, you can also enjoy big savings. 50% off of resale items equals very cheap!

Now that you are all excited to hit the stores, a couple of cautions.

1. Don’t go crazy. Don’t buy something just because it is a good deal. If you don’t use it, you just wasted your money. Make your list, and stick to it!

2. It isn’t a good deal if you have to use credit to pay for it. Don’t ruin your good deals by paying interest on them. Use cash or your checking account. If you don’t have anything but credit, you are better off not buying now.

So go, find those deals. Enjoy the savings, but stick with what you need and what you have the budget for.

Apart from spending less, another option to pay your debt faster is to increase your income. You can make money for an extra payment with a little creativity and a few ideas to get you started. You know the best debt reduction technique is to pay faster.

The first step to the ideal financial life is to get organized. Some people are naturally organized, the rest of us have to learn how to do it. Create your personal space to deal with finances.

The idea is to make your finanacial life more efficient. Keeping all papers in one place is a first step. We will reorganize the rest slowly.