Setting an Allowance for Kids

March 21, 2013 By MotherCreative 2 Comments

Teaching financial responsibility to children is important, and one of the best ways to do that is to set up an allowance. It helps them understand money management in an effective manner. Right from buying their favorite toy to saving up to buy their dad golf accessories using the GolfNow.com coupons – kids can use their allowance money for many things.

A lot of experts hold the belief that children should be given allowance starting as early as 10 years. So how much allowance should you give your children? Let’s find out in the following article…

1. Form a Budget

Before you go ahead and create an agreement with your kids on how much allowance you will be setting up for them, form a budget. This helps you know beforehand how much money you will be able to give them every Monday or any day of the week you choose. As a parent, it will be your responsibility to give them their allowance on time and live up to your promise.

2. Decide on Chores

Talk to your children and decide if you want them to perform certain weekly chores in order to get the allowance. It’s completely up to you whether or not you base the allowance amount on the chores you give them. In case you require your child to do chores for receiving money, then explain this to him or her so that they know that their hard work is being rewarded.

3. Decide on How the Allowance Will be Used

While you want your child to have the freedom to use their allowance to buy what they want, you can also have a savings account set up for them. Having a savings account will teach your kid the overall importance of saving money. For instance, when you’re shopping online for a sporting gift for your husband, you would want to get a discount using something like the GolfNow.com promo, because you ultimately want to save money. Similarly, your children should also understand how to save the money they get so that they can make better financial decisions in the future.

4. Give Separate Clothing Allowance

If your son or daughter is a teenager, then chances are that they want to spend money on clothes. This is an addition to the weekly allowance you decide for them. When and if you decide to give a clothing allowance, make it quarterly so that you can set a budget for the clothes shopping. This will make your kids better at money management, and they will realize that if they put all their clothing allowance in buying one expensive shirt, they’ll have to make sacrifices for other clothing articles.

By giving your children an allowance you’re basically giving them the freedom to make financial decisions at an early age. This will help them to learn how far they can stretch their dollar amount. Just see to it that you live up to your promise and give the allowance on time because if you don’t, it can create a negative impression on them.

Image credit: Hobbies on a Budget

Filed Under: Education, Household Budgeting Tagged With: allowance for kids, financial decisions, financial responsibility, form a budget, kids allowance, money management, set an allowance, setting an allowance, teaching financial responsibility

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Finance on the Move — Managing Money When Relocating to Dubai

March 12, 2013 By MotherCreative 1 Comment

Relocating can be stressful, especially when you’re moving to somewhere as far away as Dubai. As well as packing and boxing up items, making the shipping arrangements, tying up loose ends before you leave and saying all your goodbyes, you have to manage the financial aspect of things.

When you’re planning a long-term move to Dubai, one thing you should consider is arranging a home loan with HSBC before you head out. This is much easier if you do your personal banking with an international bank like them, who have branches throughout the UAE.

Of course, relocation generates a host of expenses, and you may find yourself turning to the bank to ease the burden. Here are some of the main expenses, plus tips on how you can save money while living in Dubai.

Be prepared

If you rent a property, you’ll have to pay several expenses up front. These include a whole year’s rent, a deposit (5% of the annual rent), agency fees (5 to 10% of the annual rent), and water and power. You may choose to cover these expenses by taking out a personal loan.

Moving into a new place takes time, so you’ll have to arrange temporary accommodation, whether renting or buying. If you’re relocating for your job, your employer is likely to cover the cost for you. But don’t take this for granted. Make sure you can pay for at least two months of temporary accommodation.

Learning doesn’t come cheap

Like anyone else, children need food, clothes, and a roof over their head. The other thing they need is education, which is expensive in Dubai. Depending on the school, private school tuition for expats ranges from 5,000 to 100,000 dirham (1,360 to 27,230 dollars) each year per child. You can save money if you send your child to a school that follows a UAE curriculum, but you’d have to pay for private language tuition for your child, as lessons will be given in Arabic.

Food and clothing easy on the purse

Dubai may be opulent, but some areas cater for budget-conscious consumers too. In Bur Dubai, Deira, and Karama, you can find shop for food and clothes cheaper. Keep an eye open for discounts during sales periods: some clothes stores take off as much as 75%!

Take the time to learn about Arab cuisine before you go. Typical Arab foods cost less. Learning to prepare and appreciate them can save you money.

Hitting the road

The UAE is a cheap place to buy a car, one of the cheapest places in the world in fact. Fuel prices are also low, so you can drive the kids to school without worrying too heavily about the household budget. However, if you are worried about the costs of running a car, you can save money by renting one from a local car rental firm, by using taxis or by using the metro system.

Relocation has its expenses, but banks like HSBC offer good accounts for people who are moving to the UAE. Consider a home or personal loan with them, spend sensibly while you’re there, and you can manage the financial side of your relocation much easier. More importantly, you can make it much cheaper so that while Dubai is welcoming you, you can be welcoming extra dirhams in your pocket.

Filed Under: Home & Family, Household Budgeting Tagged With: finance, home loan, living in dubai, move to dubai, moving to dubai, personal finance, relocating to dubai

Personal Responsibility with Personal Finance: Acknowledge the Pitfalls and Fix Your Mistakes

February 19, 2013 By MotherCreative 5 Comments

There’s no personal finance without taking personal responsibility.

You can say what you want about external factors but much of your financial situation is one brought on by yourself. Sure, there are those unexpected moments when you have to burn through savings (such as a major car incident) but the point of personal finance is to get you set up with proper money management regardless of how much you bring home.

The main elements of personal finance

PF comes down to just a few small actions to make the biggest difference in money management:

Understanding where your money comes and goes
Developing a routine for your savings
Creating a safety net through an emergency fund
Expanding your options and growing your wealth

Many people live outside their means which drives them to pitfalls and financial ruin. The best action one can take is to embrace a frugal lifestyle. No, you’re not being cheap and you’re not eating lentils every night – frugality is a way of life which trains your mind into understanding the smart, logical choices for your money.

Acknowledge what you’re doing wrong

It’s time to “man up” to how you’re spending your income:

Do you continually upgrade gadgets that don’t truly need upgrading?
Do you splurge on dining out when you could stay in and cook?
Are you failing to maintain your housing, transportation, and health?

These are but a few examples that many people let slip which eventually starts a snowball effect on their debt. Being unprepared for life’s curve-balls is what will drive you off the cliff of financial stability.

The only way you can truly fix your money mistakes is by knowing what’s causing them.

Take a cold, hard look at your finances and you’ll quickly realize what needs to be done; it’ll be an uphill battle but clamoring out of debt, setting a workable budget, and living within your means will give you a stress-free lifestyle that has no limits.

Get things in motion

One great way to get things moving is to undertand where you currently stand financially. This can be done by creating a basic budget or by using a resource like MyMoneyCheckup.org; a website and tool created in part by the Social Security Administration’s Financial Literacy Research Consortium (that’s a mouthful), funding from Ohio State University, and the National Foundation for Credit Counseling (which has been active since 1951 offering guidance on credit and debt reduction).

The tool itself is about as simple as you can get but packs a punch when it comes to personal finance education.

The tool will take you through a questionnaire in the main categories of money (budgeting, borrowing, savings, housing, retirement, and more). When you work through this tool and run the report, you’ll see the areas which need improvement; these areas are marked by green (good), yellow (okay), and red (bad).

Action steps:

Come to terms with your ability to manage your money
Understand where your money is going by using the MyMoneyCheckup tool
Use the financial calculator (on the site) to reconfigure your finances
Begin the process of rebuilding your financial education with the included resources

A simple 5 – 10 minute process, using the tool (which is also now available in Spanish) will give you the jump-start on “owning” your mistakes. It’s unfortunate that personal finance isn’t a skill most taught throughout school but one which you discover but there’s no reason to wait any longer – get started right this moment and you’ll never again need to be on the lower end of your finances.

You can find this helpful financial tool and resources over at MyMoneyCheckup.org.

Image credit: Tax Credits

Filed Under: Household Budgeting, Keeping Control, Saving Money Tagged With: budget, budgeting for lifestyle, financial calculator, financial tool, financial tools, frugal lifestyle, frugality, how to manage money, money management, my money checkup, mymoneycheckup, personal finance, personal finance education, personal responsibility, proper money management, save money, saving money, Spotlight

7 Easy Ways to Save Money on Credit Cards

March 29, 2012 By MotherCreative 14 Comments

Saving Money Requires More Than Coupons and Sales

During financial troubles, many people rely on credit cards to make purchases. However, the interest rate on credit cards is high. Therefore, it could cost you a significant amount of money down the road. Here are the top 7 ways to save money on credit card interest, so that you’re not strapped for cash forever!

1. Obtain Your Credit Report

The higher your credit score, the easier it will be to get better interest rates. Contact a credit bureau and ask for a copy of yours. You should look over your report and correct any inaccuracies. If the report contains a mistake, it could lower your credit score, so you need to do it ASAP before some bank or credit card sees that.

2. Contact Creditors

Contact each of your creditors to ask them what you can do to lower your interest rate. If you have paid your bills on time, you might have some negotiating power. Credit card companies are very competitive, so they want to try to keep your business. If the credit card company is not willing to lower your rate, you might want to consider switching companies – you can likely find a great introductory deal.

3. Compare Companies

If your current credit card company is charging you a high rate of interest, compare offers to see if you can find a lower rate. You might be receiving enticing offers in the mail but have just chucked these aside? It might be worth it to take look at what the company is offering. You could find a great deal!

4. Claim a Hardship

If you are to a point where you are really struggling to pay your bills, you need to call the credit card company and explain your situation. Credit card companies want to be paid, so they might be willing to work with you, so they can get their money in the long run (a few months or even years is nothing to them). If you file for bankruptcy, they will not get any money from you, so it’s in their best interest to negotiate.

5. Pay Off Credit Cards

The main way to save money on credit card interest is to not have a high balance in the first place! Collect all of your credit card bills and compare interest rates. Pay off the high interest rate cards first, and quit charging on those. It might help to create a budget and make a plan too.

6. Transfer Balances

Many credit card companies offer deals to entice you to apply for their cards. One of the deals that might be offered is a 0 percent interest rate for a certain amount of time. If the balance transfer fee is low consider transferring your balances on a high interest card to a new card. However, keep in mind that the introductory period will expire at some point, so you need to try to have the card paid off before the introductory period is complete.

7. Get a Home Equity Loan

If you have several different credit cards with high balances, you might consider getting a home equity loan. After receiving it, you can pay off all of your credit cards. These loans offer much lower interest rates than credit cards, so shop around to find the best one. Then, cut those cards up!!

Have another trick to save money on credit cards? Let us know!

[box_light]This is a guest post written by Jill Ramone. Jill likes to save her family money with Life Insurance Quotes. [/box_light]

Image courtesy of marsmet543.

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Filed Under: Guest Posts, Household Budgeting, Keeping Control, Other Ways to Save, Saving Money Tagged With: budget, create a budget, credit card debt, credit card interest, credit cards, lower interest rate, save money, save money on credit card interest, save money on credit cards, Spotlight

How to Create a Money Saving Budget

February 15, 2012 By T.Wolf 10 Comments

Budgeting Can Help You Save Money

When you hear the word budget, chances are you cringe just a little bit. Living within a budget is one of those things that is necessary for most people. The best way to think about it is not as a horrible chore or as depriving yourself of things that you enjoy, but rather as a necessity that in turn will help you get your money in order to live a comfortable life for years to come.

A family budget is important as it offers a way to save money and not become inundated with debt. A good household budget will remain realistic, allowing you to do things that you enjoy, but at the same time not spending over what you can afford.

How to Create a Family Budget

The first step to making a budget is to understand your cash flow. The backbone of a solid household budget is to know how much you spend each month on both your needs and your habits. A family budget will require you to track your personal cash flow, meaning how much comes in and how much goes out.

Figuring out your monthly income is the easy part, tracking all of your spending is what will take a bit of effort. You will need to collect all of your bills. This includes credit card statements, grocery bill receipts, gas receipts, and anything that you use cash to pay for. If you have not been keeping records of your spending, or do not have access to some of these receipts, you may need to track every dollar that is spent for an entire month before you can set up an accurate budget. You can use a notebook or an online program such as Microsoft Money or Quicken. These programs will make your budgeting much easier and are definitely worth the investment.

Once you have determined your spending habits, you then need to divide them into fixed costs and variable costs. Fixed costs include things such as your mortgage payment, car payment, and loan payments. Variable costs include things such as food, clothing, and entertainment.

Set Your Goals

The next step to setting up a family budget is to set your goals. Once you know what you are spending each month it becomes easier to determine the costs that you can trim from your spending and which ones that you cannot. Setting small goals is a great way to stay motivated and on track with your budget. For example, take the $2 you spend on coffee every morning and put it into a piggy bank or a jar. By the end of the month you will have a tidy little amount of money that can be placed into a savings account or money market account. Remember, budgeting does not have to be hard, but you do have to motivate yourself to do it.

Image Credit: 401K

Do you have budgeting tips that you would like to share?

Filed Under: Household Budgeting, Other Ways to Save, Saving Money Tagged With: budget, budgeting tips, create a family budget, creating a budget, family budget, household budget, how to budget, living with a budget, making a budget, save money, saving money, Spotlight

How to Plan a Week of Meals on a Budget

January 29, 2012 By T.Wolf 1 Comment

As a family of four living on a single income, it is important to budget wisely. This includes saving money on food whenever possible. One of the best ways to save money on your monthly grocery bill is through meal planning. Most families spend the majority of their monthly budget on food.

When you hear the word planning, it is likely that your thoughts automatically go to time consuming and difficult. However, once you get organized with a few simple steps, you will find that weekly meal planning is actually quite easy and can even be fun.

Getting Started

The first step to meal planning and saving money is to get a flyer from your local grocery store. Most of the time, these flyers will come in the mail each week. You might want to search through a couple of different ones to find the best prices. You can also go to the store’s website in order to see the weekly sales ad.

Sales and Coupons

The first thing that you should look for is sales on fresh ingredients. Fresh produce and meat are things that you will need to buy on a weekly basis, so it is important to look for the lowest prices on each. I tend to focus on these types of ingredients for my meals and ignore most of the prepackaged food items. The reason for this is that most fresh ingredients are cheaper in the long run and also healthier.

Use a Meal Planning Sheet

A simple meal planning sheet will consist of the days of the week with a box for breakfast, lunch, and dinner. Once you have your recipes and ingredients in place, start plugging in the meals for the week. Many lunches can consist of leftovers from the night before. You can also purchase simple items for lunches such as sandwiches. You can then make your list from the ingredients needed for each meal. Cross off items you currently have and make sure that you have enough of the basics such as flour, butter, eggs, milk, etc.

Taking the time to plan meals out for the week is a great way to save money. Make sure to stick to your list and shop the sales. You will also want to use any coupons you can find. It is amazing how much money you can save when you take the time to plan out your meals.

Filed Under: Grocery, Household Budgeting, Saving Money Tagged With: budget on food, fresh produce, Get Organized, meal planning, meal planning sheet, plan meals, plan out meals, save money, save money on grocery bill, saving money, shop sales

Budgeting 101: Needs Vs. Wants

September 19, 2011 By Randi M. Leave a Comment

An important step to creating a budget is distinguishing between “needs” and “wants.” Sometimes we need something, and sometimes we want something, and it can be difficult to tell the difference. Distinguishing between the two, however, can mean the difference between maintaining a successful budget and going into debt. That’s why it’s important to step back and look objectively at our spending habits to see how much you pay for needs versus wants.

What’s the difference? A need is something that we must have for our survival, such as food, housing, clothing, transportation or health care. Wants are things that we would like to have, but we can actually live without, including vacations, entertainment, dining out and gifts. Here are few examples to demonstrate the difference:

Need: Clothes appropriate for work and home / Want: Name brand and designer clothing

Need: A reliable car / Want: A new car with all the bells and whistles

Need: A telephone to keep in touch with work, friends and family / Want: The newest phone gadget with an expensive service plan

Want: Anything you think you need simply because other people have it

The purpose of examining your own wants versus needs is to reduce your spending and ultimately reach your financial goals. Maybe your goal is to buy a home, create an emergency fund, save for retirement or send your children to college. It’s certainly okay to want things, but you should put your hard-earned money to what you truly want. Ask yourself this question:

Are the things I think I need today keeping me from what I really want tomorrow?

One way to look at your needs and wants is to create a needs versus wants worksheet. Here are a couple to get you started:

Freddie Mac Needs Vs. Wants Worksheet

Needs Vs. Wants Worksheet

You’ll be surprised at what you can easily go without when you keep your long-term financial goals in mind!

Filed Under: Household Budgeting, Saving Money Tagged With: creating a budget, needs and wants, needs versus wants, wants versus needs

3 More Areas to Cut Your Monthly Budget

September 4, 2011 By Randi M. Leave a Comment

Whether you’re trying to pay down debt, save up for something special or simply cut expenses, it always helps to think about areas to cut down your monthly budget. Sometimes the satisfaction of reaching our financial goals is more than worth small sacrifices. Keep that in mind when you think about these places to cut your budget:

Lower Your Phone Bill

Many families, like mine, are switching to cell phones only and getting rid of landline telephones entirely. If you do want to keep your landline, such as for business or emergency purposes, make sure you have the cheapest long distance plan available and aren’t paying for extra services you don’t need, such as three-way calling.

Closely examine your cell phone plan. Are you paying for extra services you don’t need? Are you paying for more minutes than you use each month? If you don’t need a smart phone for business, consider getting rid of your data plan if you only use it for fun stuff and checking your email. My hubby and I have a talk-only plan and pay $75/month for both our cell phones. It can be done!

Cut Out Luxuries

Carefully consider which of your budget items are necessities and which are luxuries. Especially if you’re in debt, you can’t afford to pay for too many “wants.” Focus on your “needs” until you’ve paid off your debts and are able to truly put your income to good use. Things like gym memberships, dining out, fancy coffees and pricey entertainment are probably not a good idea right now.

Lower Your Insurance Bill

Consider how much you’re paying each month for car insurance. Most companies charge a fee for you to pay monthly, so first, switch to biannual payments and save accordingly (set up a “sinking fund” and save toward this bill each month, so you have enough set aside to pay it when the time comes).

How much is your car worth? It might now make sense to carry more than minimum coverage if the cost to repair a vehicle is more than the vehicle’s worth. Raising your deductible will lower your monthly premium. Finally, most insurance companies offer a discount for combined services. Combine your car and home insurance policies, even if it means switching insurance carriers.

Filed Under: Household Budgeting, Saving Money Tagged With: cell phone plan, cut expenses, cut your budget, pay down debt

Budget Items You Should Consider Eliminating

August 19, 2011 By Daphne_Writer Leave a Comment

Creating a successful home budget will cost you. Every budget involves making sacrifices if you actually want to save money or live below your means. That’s why you might be tempted to avoid making a budget altogether. It hurts. The end goal, though, is control over your finances and if you stay on the right course, financial freedom. To get there, you should eliminate these 5 budget items when possible:

1 – Buying Lunch

As a work at home mom, you don’t have to buy lunch because you can make it for yourself. But if your spouse is still buying lunch, then you’re not saving as much money as you should. Make that line item a “0” and transform leftovers into his lunch instead.

2 – Some Extracurricular Activities

A home budget worksheet can reveal the state of your family life. You could be spending too much money every month to keep up with extracurricular activities that clutter your life and drain your finances. Take time to examine all of your activities, including the ones your kids are involved in and what you do on your own. Eliminate the ones that are causing monetary and time management problems, unless they are an absolute must for meeting some other family goal.

3 – Cable

Paying for cable TV is hard to justify when there are so many free and affordable alternatives to watching television and movies. One tip for how to create a home budget is to find cheaper ways of doing the same thing, if you don’t want to get rid of it entirely. Look into Netflix or change your habits. You may be surprised at how much you enjoy listening to podcasts, talk radio and webinars when you eliminate your cable bill.

Think beyond the pain of eliminating some of your prized budget expenses. Focus on living debt free, building a successful home business or any other financial goal you have planned for your family.

Image Credit: Sanja Gjenero

Filed Under: Household Budgeting Tagged With: budgeting, create a home budget, making a budget, save money, Spotlight

Budgeting with Envelopes

August 13, 2011 By Mindy H. Leave a Comment

My husband grew up in a home where all the money budgeted for the month was withdrawn from the bank at the beginning of the month and then divided into envelopes that represented budgeted categories. My in-laws are some of the thriftiest folks around; I really look up to them. My grandparents use a similar system. A few years ago, it became necessary for my family to tighten up the purse strings, and operating mostly with cash from envelopes really appealed to us. We have budgeted in this way ever since.

This is a system that we have really liked. It gives us a sense of control over our money; we can visualize what we have left to spend for the rest of the month at any given time. It reigns in our unnecessary spending and provides checks and balances where there used to be none.

My in-laws use their cash budget envelopes for almost every category: car expenses, clothing, gas, gifts, groceries, house insurance, household items, license plates, medical bills, taxes, vacation, individual spending money, child sponsorship, and even one for the dog. They keep a binder with sturdy envelopes attached to the rings. At the beginning of the year, they figure up what the yearly expense will be in each category, divide each one by the twelve months, and then put that amount of money in the individual envelope each month.

We are not quite so sophisticated yet at my house! We still use our debit card for gas and for unexpected expenses — although we still have individual budget areas, even for non-cash categories. When we began, we had a grocery envelope, an entertainment envelope, an eating out envelope, and individual spending money. I used to keep a little cash from each category in my wallet; I paper-clipped a label to each amount and kept track of it that way. That system worked well for us. We noticed a huge difference in the areas of grocery shopping and eating out. When we ran out of eating out money, we just had to stop eating out for the rest of the month!

More recently our income has gone down significantly, and we have adjusted our budget accordingly. We now have two envelopes: groceries and miscellaneous. Groceries work like they had been working — we grocery shop within our allotted budget and we don’t go back to the store in a given month if we run out of cash. Our miscellaneous money is around at the beginning of the month in order to cover unexpected expenses that may arise. If, by the end of the month, we still have some cash left then we can use it on entertainment or eating out. Most months that is the case, and it is a real treat!

Moving to a cash budget was a big step for us, but we have found it to be a good discipline. It keeps us on track. Someday it will also be a good, concrete tool to help us teach our kids about being frugal and living simply — two of our deeply held values.

Filed Under: Home & Family, Household Budgeting, Keeping Control, Saving Money Tagged With: budget, cash budgeting, envelope budgeting, save money, Spotlight

Setting an Allowance for Kids

Finance on the Move — Managing Money When Relocating to Dubai

Personal Responsibility with Personal Finance: Acknowledge the Pitfalls and Fix Your Mistakes

7 Easy Ways to Save Money on Credit Cards

Saving Money Requires More Than Coupons and Sales

1. Obtain Your Credit Report

2. Contact Creditors

3. Compare Companies

4. Claim a Hardship

5. Pay Off Credit Cards

6. Transfer Balances

7. Get a Home Equity Loan

Have another trick to save money on credit cards? Let us know!

[box_light]This is a guest post written by Jill Ramone. Jill likes to save her family money with Life Insurance Quotes. [/box_light]

How to Create a Money Saving Budget

Budgeting Can Help You Save Money

How to Create a Family Budget

Set Your Goals

Do you have budgeting tips that you would like to share?

How to Plan a Week of Meals on a Budget

Budgeting 101: Needs Vs. Wants

3 More Areas to Cut Your Monthly Budget

Budget Items You Should Consider Eliminating

Budgeting with Envelopes

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