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The mere mention of the term budgeting is enough to spur unease among many. Budgeting as in cutting down on expenses? Living without the things we’re used to having? The answer is not just a simple YES; budgeting is so much more than the negative connotation you perceive it to be. A lot of people think of budgeting as synonymous to living cheap when the truth is, it’s really about how you stretch your dollar. You may even rationalize your spending with the justification that you are earning enough (maybe more) to cover your spending spree, but it’s not about how much money you make; the bottom line of budgeting is how much of your hard earned bucks you get to KEEP!

Sure, you can still buy the things you need and want to make for a comfortable living; you just have to plan for it. Now that entails keeping track of where your money goes and how much you spend for each item (food, groceries, gas, clothes, etc.). You may bemoan the fact that there are so many categories to consider, it would be hard to trail your expense activity for individual expenditure. Not if you adhere to these 10 easy-to-follow budgeting tips that this article suggests.

• Be clear on how much you make. Start by putting together a list of your income. Now this may not be as straightforward as just looking at your annual salary and dividing it by 12 to get your monthly income. If your yearly pay is $60,000 it is likely to get knocked down by roughly $10,000 in income taxes, with the likelihood of dropping even lower when you consider other upfront costs for work benefits, such as health insurance, for example. With that scenario, it is quite inaccurate to use $5,000 per month as your baseline for your budget; $4,000 is close but less than that is a more realistic approximation. It is therefore prudent to know your exact take-home pay. If you have other sources of income besides your paycheck that you use for monthly expenses as well, you can include them on the list. Remember, the total of these figures will serve as your framework number when you draw up your budget.
• List down every single item you spend your money on. It’s a bit tough but don’t miss out anything. If you’re uncertain, go for an educated guess. Stick to more familiar and identifiable listings first and classify them into “categories” (e.g., Utilities, car payment, rent/mortgage, insurance, etc.) Get the picture? You can build up the specifics or re-categorize the items as you go along. You may want to separate items in a category that appears to have an overwhelmingly huge amount as the “Utilities”, for instance – you can break it down into Gas, Electricity, and Water. It may take you over a month to get the hang of it and become better at giving approximations to some categories. Your first budget may not even actually be a budget; but you’re in the right track if it reflects your spending pattern in a typical month.
• Make room for incidentals and non-recurring or irregular expenses. There are bills that don’t occur on a regular basis and you shouldn’t be “caught off-guard” like they’re unexpected surprises. Make sure you consider expenses that are incurred only once a year (i.e., property taxes, car insurance, homeowners’ insurance, car licenses, and so on). Likewise, provide figures for such expenses as car maintenance, vacations, birthdays, holiday presents, weddings and similar items. They may not occur every month but they sure could get your budget plans busted. Keep in mind that it’s not the regular routine expenses that could wreak havoc on your budget; it’s these “Gotcha!” bits and pieces.
• Come up with a List of Comparisons. Have three columns for this list: 1) items with preset costs (you can’t change them); 2) items you can change but don’t have better deals; and 3) items that you’d be happy to change and would most likely find better alternatives. Mark items on your budget that you think you can purchase cheaper and shop around to research for options; you had better be good at comparing prices.
• Cut down costs by spending less. Check out items on your budget that you can reasonably cut down. That’s not saying you have to totally cut them out; just find ways to trim down the amounts you spend on those items. You can perhaps take public transport to work every so often; you can certainly slash some on fuel costs.
• Curb the compulsion to spend money on anything “unnecessary”. Figure out the amount you need to survive and how much is wasted on frivolous expenses. Impulsive buying may give you a momentary emotional lift but you are bound to regret it later when you see the “dent” it makes on your budget. In short: if you can’t find it on your list, that means you don’t need it; put it back on the shelf!
• Bring your debt down to a workable amount. Figure out the amount of debt you really owe. Sure it’s daunting; even agonizing to realize that you have perhaps let things slide a little too far, but you have to face up to it. Minimum payments may not even cut it. Try to pay (maybe double or more) as much as you can every month to feel any significant progress. Direct debit payments often decrease the amount paid each month; find out which of your monthly payments could be reduced by simply instructing your bank to implement direct debit arrangement. In the long haul, you’ll appreciate how much of a giant leap it is towards relieving yourself of debt stress.
• Be on the lookout for those killer interest costs. Interest fees and charges can inflate your debt exponentially. Look around for alternatives with lower charges on balance transfers or explore the possibility of requesting your current lenders to reduce some of their charges. And don’t even think of defaulting on your bills; a better move would be to ask for payment plans instead.
• Work and build up savings into the budget. Isn’t one of your ultimate budget goals to save or invest part of your income? Of course, it is! True, it’s not an easy feat to save money when you’re working on a budget, but think of it as paying yourself first; much like what the IRS does with your paycheck. Set aside the amount right off the bat and think of it as “untouchable”; no discretionary condition and non-negotiable. Move the amount into a savings or mutual fund account straight away before you get lured to spend it on something else. Remember those “incidentals” you set aside? You can actually put them into savings to help build up your credit (you just draw it out if needed). You’d be amazed at how building up your savings can significantly make a difference down the road.
• Set up a budget for temptations as a reward to yourself. Oh yes, you deserve it! Budgeting need not be an off-putting, excruciating experience. Once you’ve reached some of your short-term goals, you can stop a bit on your budget journey and smell the roses along the way. Sure, you can set aside a portion and use it for fun things (or frivolous expense, for that matter). It’ll actually help gratify temptations without setting off mindless budget binge. A word of caution, though: just make sure your rewards don’t screw up your budget!

To Wrap It Up…

Easy-to-follow may not exactly be an apt term because budgeting needs a lot of conviction and the right mindset to stick it out. Budgeting can be quite difficult, but it’s indispensable in today’s dire economic situation. The importance of budgeting can never be over-emphasized; especially in the modern world where all sorts of temptations are just lurking around the bend, ready to strip you of your hard-earned money.

There are plenty of versions for budgeting tips and not all of them may apply similarly in all situations; what’s important is for you to identify what works for your financial circumstances and lifestyle. Once you work out a suitable budget and keep it on track, it becomes habitual and you’d be amazed at the thrill that “a dollar saved against a dollar spent” can bring. Financial freedom is an attractive thing that holds so much potential power. Take the first step to gain this power by cultivating your budgeting skills. Make a plan that you can realistically stick to – it’s the only way to create a positive opportunity for building financial security into the future.

For some years now, the Internet has served many purposes for people from all different walks of life.  First, it was used for programming and research.  Then it evolved into the social networking era.  And now, Internet is being used for advertisements, promotions, finance, and sales, thus creating an increased need for easier money handling measures.  And that’s where the idea of Internet banking, or online banking, came from.

So what is Internet banking?  As mentioned above, it is a provision that enables users to handle financial transactions made through banks easier and quicker than the traditional setup.  How?  With traditional banking, you have to get up from the comfort of your home to go to personally to a bank, fill up forms, and line up to do transactions with the teller.  Or you may have to get up and go to the nearest ATM machine, just to check your balance on your account.  Now in Internet banking, you can be wearing your pajamas while going to your bank website and logging in to your bank account.  From there, you can pay bills, check your account balance, and do other bank-related transactions in front of your monitor.  Plain simple, right?  Because of this, Internet banking started to become a must for everyone, from a simple housewife to a wealthy businessman.

Initially, particularly during the 1980s, fax machines and telephones were used to facilitate banking accounts from your home.  It was then called ‘home banking’ because it can be done even at your living room.  The whole concept of Internet banking started evolving together with the developing world of Internet.  Things started sparking out because of online shopping, where users first used credit cards that can be paid through the Internet.  As time went by, development went through with has made it possible that even bank account databases can be accessed through the world wide web.

The first Internet banking service was established in the United Kingdom some time in 1983 through the NBS or the Nottingham Building Society.  The first launch was not err-free of course, since facilities were still restricted and only a number of transactions could be made through it.  It utilized the use of a computer connected to the telephone system; a BBC micro, keyboard, as well as a television set.  However, the whole concept, being based on the Prestel, or the postal service department, became the stepping stone and foundation of the Internet banking.

Stanford Federal Credit Union introduced the first online banking service in October 1994 to the United States.  This time, all of its users were given the ability to access their online facilities.  Meaning, as long as you have the facilities at home, you can access your accounts online.  Getting it introduced to a vast majority of people created a big fuss with the consumers, and then started the need to develop more user-friendly environments for online access.  Now, almost all banks from different parts of the world have their own internet banking service.  And there are also banks that are only based online, meaning they don’t have physical bank branches, whose numbers are growing as of the moment.

As this technology gets utilized, more advances are made in terms of security, ease, and protection.  Now more institutions developing and providing better systems and services.  Still, Internet banking has its advantages and disadvantages, but it definitely made our lives easier for us, while enhancing the financial sector as well.

Creating a personal budget is the most important thing you can do to bring financial freedom and you a peace of mind so you can be in control.
In essence, it’s like if you can’t earn more, then learn how to spend less, and be a smart spender. Make a budget. Here are 6 reasons you need to establish one:

• Control. Without a budget, money could end up controlling you. You should understand where you plan your money to be going, how much you need to spend and when these are available, and you’ll be in control. When you have your spending written down, you’ll also have an idea of your cash flow. So you can manage your money to realize plans and develop your financial skills.
• Prevents overspending. No matter what you do or how much your earnings are, managing your cash flow is important to avoid overspending. Normally, the higher your earnings, the more you spend. However, credit cards can tempt us to spend more money then we actually have. Spending expands to embrace increases in income, so it is very important to take control. When there’s a drop in income, be more aware of your spending so you do not end up in debt. It is not so much how much you earn, but how you manage your funds that matters.
• Provide a ‘snapshot’ of your financial situation. As you take note of your incomes received and expenses, you’ll know when to make changes to keep up your budget. It helps you to keep on track, so if you’re spending more than you make, you should start to spend less.
• Helps you economize and set goals. A budget gives you an idea of how much you can allot for certain goals. For example, if you want to pay off a credit card within the year, you know how much you have available, and what you can do. If you made a commitment to make it work, the budget becomes your tool to help you keep on track.
• Helps you deal with financial emergencies. Having a reasonable budget will help you be prepared for sudden unforeseen expenses that crop up. Believe me it is a smart idea to start a savings account and put money away for car repairs, hospital visits, ect. Emergencies pop up all the time and it gives you a piece of mind when you are prepared.
• Enjoy being debt-free. Budgeting shows ways you can increase savings and how you can use the excess to pay off debts quickly. In fact, a budget is the best tool you can have to stay out of debt.

All it takes is some commitment and effort to get you on a financially free everyday life through establishing a personal budget. Make sure you make a goals to put money in your savings every week or month and you will slowly start to get more financially secure.

As a youngster I was given this piggy bank by my parents in order to learn the value of saving. But as one gets older stashing your money under your bed is not enough especially during these financially challenging times.
Saving money means that a person has more at the end of the year. Saved money assures us that you have a financial safety net in case there are life events such as losing your job or becoming disabled. This protects you from suffering economically during this life changing events.

Saving earns interest. The interest that you earn from your savings will depend on the current financial trend in the market. You have more financial savings option just make it a lifestyle habit.

Planning for the future means saving in IRA’s, 401(k) plans or other retirement plans that will help you provide enough income for a safe future. Invest in mutual funds, shares, bonds and other investment options. Investing money can help you reach a higher return but do not take risk more than what you can afford.

Get out of debt. There are many expenses that you cannot avoid like your basic necessities such as food, clothing and many more. But there are expenses that you cannot pay all at once. Sometimes you apply for a loan. Plan to pay this loan one by one and live frugally so that you will be out of debt in no time.
Saving money can improve the quality of your life to make you more emotionally stable too. You can sleep better knowing that you can achieve your dreams.

There are some types of traditional bank savings accounts:
Money Market Account: Best for building up long term savings goals that you need to access right away. This can be use as emergency fund or house down payment. Some banks put restrictions on the amount of checks that you write from the account. There is a minimum balance required.

Certificate of Deposit: It is a debt instrument issued by the bank that pays interest. In simple terms you are lending the bank your money for a predetermined time period that will earn a set interest rate at the time of its maturity. It is FDIC insured and yields higher interest rates than regular savings account.

There are practical steps on getting out of debt.

Stop increasing your debt. If you have two credit cards just use one and cut the others in half, but don’t close out your account.  Place yourself away from financial temptation by moving out of its beckoning grasp.  Use your credit card ONLY for essentials.

Record your spending. If you are like most people your debt did not grow overnight. It came from some small purchases and a few major ones. Avoiding over spending starts when you know how much you are spending and for what you are largely spending it on. Purchase a notebook where you can record your daily expenses for a month.

Categorize your spending. Categorize them by must haves( basic essentials such as food and clothing etc. ),should have( are those expenses that you can still live without such as new clothes, gym memberships etc.) and Like to haves( These are things that you do not really need but it enhances your life( magazine subscription, spa, coffee out with friends). By doing this you will have a clear view on what you spend your money on. You can also figure out what you need to cut back on.

Make a budget based on your spending. Write down the specific amount that you spend each month as you budget for the next month. If last month you bought a pair of jeans for $60 then write it down.

Figure out a way to save for your debts by setting an amount aside each month. Looking at your new budget you will be able to see areas where you can cut back.  Write all of this down so that you will have a clear picture of how well you are doing. If for example you are going over your present budget then you can decide to hold back on your purchases.

Figure out how much you owe and to whom. Debt can be overwhelming especially when you don’t know where to start. Gather up your bills, make a list of all the debts that you have. Write all the details needed such as the name of the creditor, your total balance and the monthly payment that you are making plus the interest rates involved.

Start paying it off. Take the money that you have set aside for debt repayment and pay your debts. Prioritizing is important. Pay your past due creditors first or those that have high interest rates. At least tell them you plan on paying next month for your sanity, so they will stop calling you.  In fact, let them know you are working on budgeting your money in order to pay your debts.

Once you figure out how much you owe and how you can pay it. It gets easier and easier for you. Do not give up if you fail on some things while trying to get out of debt as long as there is life there is hope.  The worst thing you can do is avoid these calls.  Believe me they are not going to stop calling you until you deal with them.

Most Americans are feeling the economic crisis and undergoing their own share of tough times because of the present recession. People are having difficulty in managing their own finances. The unemployed work force is growing in numbers. This scenario makes one think of their financial security. The Obama administration wants to provide debt relief for individuals who are momentarily having their share of personal financial dilemma as long as they qualify.
The growing interest rates has caused more than one American to walk away from their mortgages that even the banking industry has coined a nickname for it calling it strategic mortgage defaults. The reason for using a debt relief may be due to the following reasons:

• Some homeowners cannot find a lender who is willing to offer a home refinancing deal since the home has lost its value. This move on the part of the homeowners may sometime force lenders to enter into a revision on their loan by conducting an open dialogue between the homeowner and the lender.
• Because of legitimate reasons such as sudden illness and loss of work homeowners are betting that loan officers will empathize with them enough to take a long time before they foreclose the home owner’s property. This gives them time to catch up on their payments.

An astute observation made by the credit bureau through a research study showed that Americans use debt relief as a calculated move to for a short term financial gain. The basis of this is that the individuals who are availing for a debt relief usually show no outward signs of economic stress. Other people on the other hand have found that the present government offers Government grant for people who may be going through a tough spot. These grants are only given to the real needy ones.  If you are drowning in debt and have no options then the government is willing to give you the grant.  People who qualify for debt relief are those who have loss a job, divorce, medical bills and many more valid reasons.

It is a very wise decision to seek credit counseling to help you get back on your feet. Do not jump into filing for bankruptcy because there are still better options than that. You can seek help on how to create your budget, how to control your spending and how to save for the future. If your income is lower than your bills it only means you are living beyond your means.  This may also imply that you need to drop some of the luxuries that you usually can live without so that your life will improve financially. Your main goal is after debt relief you must be debt free by following this simple rules.

How to Avoid Debt Relief Scams

If you find yourself in a debt situation that makes you feel as if you have no way out then do not let yourself fall victim to debt relief scams. The most undesirable type of scams is one that is categorized as organize criminal activity. They will sweet talk people in giving them their money presumably to help them negotiate with their creditors but in reality they will just take their victim’s money and run away with it. To avoid entrapment or leaving a paper trail behind they would usually ask for cash. These unscrupulous characters go to extra lengths to keep their identity anonymous by changing their fake company names and fake websites that can easily be made offline.

Another scam is the one who says that you can claim US government grants to help you with your debts. They ask for monthly subscriptions but later on after you have paid them, you will come to know that it is all a scam. There are ways of knowing which ones is scam and which one are for real. If the company does not give a full office address with all the necessary details and only uses a P.O. Box, then chances are these addresses are just dummies. To check on whether your present debt relief company is actually paying your debts on your behalf, you can call your creditors directly.

You are much safer if you get the services of a non-profit agency that conforms to the AICCCA standards (Association of Independent Consumer Credit Counseling Agencies). One fact that you might have overlooked is that most creditors would appreciate it if you decide to communicate with them to address your specific financial dilemma.

Some debt settlement scams are as follows:

• These companies will not provide you the complete details on how they would help you deal with your settlement process
• They offer to take preventive measures so that harassing phone callers will stop subjecting to their irritating calls but in reality they will not make a move as they say they would
• They hide from the consumer the actual amount that these consumers need to pay and say that they can help these consumers to save a lot
• They would suggest for you to stop paying your creditor balances or monthly dues and instead open a savings account but they are the only ones who will keep the details of your account without you knowing anything. Wake up since they are on the run with what little money you have left!

There are those who offer fake credit repair services to supposedly help you improve on your credit score. They will charge you with up front payments that are against the law. Never divulge any personal information especially about your bank account. It is your responsibility to guard yourself against such illegal practices after knowing the basic scamming techniques that people will use to take advantage of you even if you are up to your neck in personal debts. As long as there is life there is still hope that one day you can recover from these financial losses.