By Bobbi Burger Brunoehler of Bobbisbargains.
wrestlingentropy/flickr
My son has officially become an adult. I know because he gets credit card applications almost every day. I’m amazed at what banks are offering a teen who does not have a job or any way to pay off the debt he might incur. Juxtapose this against the tremendous scrutiny that my credit report underwent recently when I applied to get a mortgage and you can see that something is amiss. Why is my penniless son being lured into debt while the banking industry is making great credit-scored working adults pay huge fees to get a fully collateralized mortgage? Sorry, I don’t have the answer to this question, but if anyone else does, be sure to enter a comment so that I find out the answer.
What I DO have the answer to, is how to save a lot of money by (more…)
Logan Antill/Flickr
I’ve been fairly responsible lately with my credit card, perhaps owing to my monthly-long credit card ban in April. But last month I slipped up and forgot to pay my bill on time. I paid three days late, incurring a $12.15 interest charge. Blast!
Normally, I would call my credit card company and politely ask that they remove the charge, seeing how I am a loyal customer who pays in full. But I didn’t because I truly forgot to pay my bill.
Instead of automatically paying each month, I get two reminders to review my bill online, then pay via bank transfer. My first reminder comes about three weeks before the due date and I usually ignore it because the due date is sooo far away.
The second reminder is a note that pops up in my online Google calender about five days before the bill is paid. When I get this I log in, review the charges, and set a transfer from my bank to pay in full two days before it is due. If anything is amiss, I can contest without paying.
Last month, however, my second reminder popped up on a weekend, when I rarely check my online calender. My credit card due date sailed by before I remembered. I hate to pay the $12.15, but think it is fair. I’m more worried about how a late payment will affect my credit history so I’m considering putting my credit card on auto-pay. What do you think?
By Mike Barclay of 10CentsWorth.com
A lot of you may be surprised to know that I’m not the most financially savvy person. What might floor you even more is that I’m still learning. Here’s what I’ve learned and where I need your help. Deal?
Priorities and Will Power
If you were faced with the choice to pay rent or your cell phone bill, which would you choose? The logical choice should be rent, right? For a while, I would actually choose my cell phone. I figured it was okay to accrue late fees so I could text my friends. Well no more!
I have a file on my computer that sums up my bill priorities in the order they need to be taken care of and reminders on my calendar to check it periodically. Here are the top 5 things on my list as of right now:
1. Rent (I always make sure my rent is set aside. Being homeless = not a good idea.)
2. Court Fees (Speeding tickets people, speeding tickets. I’m no criminal.)
3. Cell Phone (For me, I need my phone on for potential employers, etc.)
4. Car Insurance
5. Credit Card Bills
I’ve conditioned myself to take care of the important priorities by having my friend reward or punish me with small things, like taking away my laptop for a couple of hours, or we’ll grab a bottle of wine as a reward. With proper budgeting I have enough to take care of everything.
Planning
I was an impulse buyer. I’d go grocery shopping with no list, a rough idea of what I needed, and a wad of cash. I’d walk into the market and out with a whole bunch of random food, inevitably forgetting an essential, like milk. I’d end up spending way over what I’d planned. Now, any time I go grocery shopping, I make a detailed list beforehand and, most importantly, I don’t deviate.
Banking Alerts
If my bank gave me the money they charge for over drafting, I’d be sitting on a beach somewhere drinking wine and doing nothing. I was horrible at looking at my account balance daily and making sure I had enough to spend. Thankfully, we now have modern technology. If you bank online, there’s a way to set up email and text alerts if your account drops below a certain amount. And (depending on the bank) you can even make it send you your balance text after every purchase. I don’t have an excuse to over-draft anymore.
Savings Accounts
My dad taught me the value of a savings account, I just never paid attention. “Have money, will spend” has always been my mentality. What I’m trying to do now is put away 10% of my check into a savings account and never look at it again. If I ever need car repairs or have an emergency, I’ll have money ready to go.
Some of these strategies I practice now. Others, I’m not fully on board with yet (e.g. putting money in a savings account). Do you have any advice to make it easier to manage my finances? What have you learned from your moments of weakness?
By Mike Barclay of 10CentsWorth.com
Sean Oliver/flickr
If there’s one phrase in the English language that brings more pain than others, it’s “late fees.” Nobody likes to hear the words, “I’m sorry, but we’re going to have to add a fee for your late payment” or see a late fee tacked onto their credit card statement.
It’s tempting to be apathetic and think, “Eh, it’s only another $15 I have to pay.”
Not a smart idea. Here are four late fees that add up quick:
Library Fees
With late fees racking up at around fifty cents per book per day, avid readers like myself can end up with a hefty bill for forgetting to return books. I have about ten books out currently (not past due, go me!) but if I were to bring them back a week late, that’s an extra $5 out of pocket though they started out free!
One week of late fees for 10 books = $5
Redbox Movies
Movies for a dollar? Or nothing if you have a Redbox coupon code? Fantastic! The kicker comes when we end up with no time to return the movie, which is a plague amongst many. Technically, you are not paying a late fee but re-renting the movie for a dollar per day each movie is past due. Soon you are close to paying theater prices.
Week of extra rental fees for one movie = $7
Credit Cards
I have a Best Buy credit card for my laptop that I’m still paying off. If I miss the payment date, they tack on $25, which is less than the average credit card late fee of $35. Not to mention the interest that adds up the longer I take to pay off the laptop. A year of late fees alone adds up to $300! That’s almost a quarter of what I paid for the laptop itself.
One year of credit card late fees = $300
Apartment Rent
First day late is usually around $15, and then another $5 per day after that. At least that is how it is for my apartment. I hope that all of us are timely enough to avoid late fees. I don’t know about you, but an extra $20 in late fees digs into my wallet.
Two days late on rent = $20
Now that I’ve sufficiently depressed you with how quickly late fees accrue, how do we stop it? I set alarms and reminders for myself. If I get a movie from Redbox, I’ll post a sticky note somewhere I will see frequently to remind myself to return it. I’ll even schedule due dates into my calendar so a reminder of the due date pops up on my phone. Same thing with library books, credit cards, and other bills.
Being late is not worth the extra cash. Trust me, from my own personal experience, it adds up.
