Do you "envelope" budget? Credit: PinkMoose/Flickr
A friend emailed me with a bit of budgeting advice passed on from her mother, the professional organizer Janet Fishman:
Set up separate bank accounts for: living expenses, play, long-term savings, education, charity, and retirement and have either a percentage or fixed dollar amount from each paycheck go into these accounts. Most all companies that offer automatic deposits for payroll have the ability to automatically deposit into multiple accounts. Figure out how much you need to pay taxes, divide by the number of weeks you work, and that constitutes the dollar amount to set aside for each week. Repeat this for the categories above and you will be fully prepared and organized year round!
This ads up to six accounts – or more if you set up one for taxes and other categories. Phew! That strikes me as a lot to manage. Plus, you would have a harder time hitting minimum balance requirements to keep your account free or low cost.
On the other hand, how much money you have to spend on any given thing would be crystal clear. No pushing money earmarked for one expense to cover something else. Plus, retirement is singled out, which makes it more likely that you will save for retirement.
What do you think of this modern take on the “envelope” system? Would you use it?
401K / Flickr
This is a post by BargainBabe.com writer Yazmin Cruz.
Recently a conversation at our dinner table turned into a chat about college. My sister is in the ninth grade, but time flies. We discussed several options to reduce her college bill and I share six of them below. My main advice was to work hard and get good grades as this will eventually help her pay for her higher education.
As many students find themselves cash-strapped and time-pressed, they are always looking for the quickest, most cost-efficient way of doing things, that’s where textbook rentals come in.
According to eCampus.com, one of the pioneers of online textbook retailing, nearly one in five of all college textbook purchases online today is a rental. Two years ago, online textbook rentals accounted for just 1% of all sales.
“We’re finding that textbook rentals appeal to students because (more…)
Case of Base / Flickr
I share five must read blog posts about saving money every Friday.
Birthday freebies – One blogger compiled a list of 21 birthday freebies at major chain restaurants and eateries.
Fall recipes – All You mag has recipes using cheap fall produce, like this appely twist on grilled cheese. Yum!
How to save for college – Kiplingers gives you the low-down on five tools to save for college.
Saving for the holidays – Time Moneyland shares three ways to save money for the holiday season.
Keeping your debit card safe – Main Street tells you which five places never to use your debit card to avoid identity theft.
Enlightening yourself has a heavy cost. Credit: TounoTouji/Flickr
This post is brought to you by CampusBookRentals.com.
Buying a new textbook from the college bookstore is passe, largely because it’s so pricey. I made the mistake of justifying many new textbook purchases by telling myself I would sell them come finals. But publishers release more updates than Apple, so my $139 Organic Chemistry tome? Still in the attic. Here are six alternatives to paying full price on college textbooks.
Slugbooks - A site that compares textbook prices across four major sellers, Amazon, Chegg, BookRenter, and Half.com. Plus, Slugbooks partners with more than 100 schools across the country to list
greenasian / Flickr
This is a post by BargainBabe.com writer Yazmin Cruz.
I’m shining the spotlight on eight college expenses that are a big waste of money – and not necessary. Don’t forget to check out our weekly back to school deals to save money on school supplies and other back to college money savers.
- Printer - Most universities offer computer labs where your student can print their ten-page papers for free. All s/he needs is a flash drive to save the doc and transport it to the lab. Emailing (more…)
How are you going to pay for college? Credit: Sean MacEntee/Flickr
This post is brought to you by Keiser University where you can get an online bachelors degree.
A 529 plan is a college savings plan with tax benefits. They have been around for 15 years, but there are still many misconceptions. I summarized these four tips from Marina Goodman, an investment strategist at Brinton Eaton in New Jersey.
1. Not realizing you can sign up for a 529 plan in any state. Just because you don’t live in Idaho doesn’t mean you can’t join that state’s 529 plan. While you can get lower state taxes for joining your home state’s plan, each state sets its own
Illustration by OConnorCartoons.com
This is a post by BargainBabe.com writer Yazmin Cruz.
Reader Forrest is the winner of my review copy of “Debt-Free U: How I Paid for an Outstanding College Education Without Loans, Scholarships, or Mooching off My Parents.” Forrest is in high school and is stressing out about the college selection process. Forrest wrote:
I’ll be a high school senior this year. What stresses me most about the whole college selection process is the financial aid. I don’t know how I’ll be able to decide between a school I like and a school with a better aid package. This book would definitely help.
Forrest, I can totally relate to you. I too felt stressed about choosing the right college. I like that at such a young age you have (more…)
This is a post by BargainBabe.com writer Yazmin Cruz. Disclosure: Zac Bissonnette used to blog for WalletPop.com, where Bargain Babe Julia Scott currently blogs.
A quality college education does not have to cost a lot of money. That’s the premise behind Debt-Free U: How I Paid for an Outstanding College Education Without Loans, Scholarships, orMooching off My Parents
by Zac Bissonnette.
Bissonnette, a college student at the University of Massachusetts and a personal finance expert, says he wrote the book for the 90-plus percent of families that find it difficult to pay tuition at a four-year private university. He writes:
I wrote this book because I’ve met, spoken with, and read e-mails from hundreds of families who are struggling with the burden of college costs – worrying about how they’ll pay for college without bankrupting their retirement or burdening their kids with massive debt loads.
One of the tips that stuck with me is a loophole for making a student eligible for more financial aid. Bissonnette suggests getting married before heading to college. Married students are considered independent from their parents (more…)
Jeremy Brooks/Flickr
There are a few new credits you can use on your income tax returns, according to Wells Fargo. Check out these credits, which I’ve summarized from a Wells Fargo press release, before you take the standard deduction of $11,400 if you are married filing jointly, or $5,700 if you are single or married filing separately.
The cool thing about tax credits is that if you end up with a negative tax liability, you will get a check from the government!
Disclosure: I am not a tax professional. Consult with a tax professional or research these credits further if you believe you are eligible.
- Got a student in college or putting yourself through school? Check out the American Opportunity Credit, designed to replace and improve the Hope and Lifetime Learning Credit. Your can make as much as $160,000 for married couples filing jointly or $80,000 for single filers and still claim this credit. You can claim the first $2,000 you spend on college expenses and 25 percent of the next $2,000 to get a total credit of no more than $2,500.
- If you lost your job recently, you don’t have to pay taxes on the first $2,400 in unemployment benefits. The same goes for your spouse. Double unhappiness turns into double deductions!
- Buy a new car or sell one? You can deduct the sales tax you paid on your new car, truck or motor home as long as you purchased it after February 16th, 2009. You can deduct the taxes up to a purchase price of $49,500, but if you make a lot of money ($250,000 for married filing jointly), the credit slides downward.
- You do not need to report your financial gains from the Cash for Clunkers program as income.
- If you bought a fuel-efficient vehicle in 2009 you may be eligible for green tax credits.
- Are you a first time home buyer? You may be able to get 10% of the purchase price up to $8,000 back in credits. To qualify you must have bought your home between Jan 1, 2009 and April 30, 2010. You have to live in your home as your principle residence for at least three years or else pay back the credit. The government considers you a first time homebuyer if you have not owned a home as your principal residence in the past three years. There’s also a $6,500 credit if you traded up to a new principle residence. The credit applies to mobile and manufactured homes but not vacation properties. Some income restrictions apply.
If you have questions Wells Fargo’s tax center has more info.
Related posts on BargainBabe.com:
Tax calculator, forms, and tips
Where do your tax dollars go? (image)
Five questions to ask before hiring a tax pro
