10 Clever Ways to Save Money in the New Year

save money in 2019

By the time the Christmas season passes us by, people are ready to pull out their hair – which may contain a few extra grays after the stress of the holidays. It’s easy to let stress get the best of us, and truthfully, it’s not uncommon to feel like life is a tad unorganized. Thankfully, we get a chance to wipe the slate clean, pull our scattered lives back together, and set an ambitious goal for the coming year. For many people, that means sorting out money matters. In order to adapt a “tabula rasa,” mentality, it’s important to commence the New Year on the right financial path, with a solid budget in place, and your consumer mind in check.

The December holidays can put us in the consumer mindset, provoking the typical American to drop money on anything and everything. Before you know it, you may have racked up debt as high as Mount Everest! Here are a few tips to getting off the debt mountain and back on solid ground.

1.      Budget Build

This may seem like an obvious starting point, but it provides the foundation from which all other money matters flow. A budget’s “job” is to create a sense of financial order. Here’s a piece of advice that just might save you a spike in blood pressure: don’t attempt to draft, edit and finalize your budget in one sitting. Instead, once you’ve collected all necessary financial details (money income and outflow), break up the work into a few manageable sessions. After completing an organized budget table, closely search for places where you can either decrease debt or augment your savings goals. Don’t forget that you should be saving more than you’re spending!

2.      Home-Cooked Helpings

Going out to eat is one of the ways in which many American families spend a significant amount of money. Because money that is spent on items outside of the home is the most flexible, it is the primary category where substantial saving can take place. Preparing more home-made meals is easier said than done, mainly because of the time commitment. There are different strategies that you can use to cut down on time and money spent at the grocery store. For example, make a 10 week meal plan, and every 10 weeks, start the plan over. You won’t get tired of the meals, but it helps keep you prepared for the week ahead as well as knowing what groceries you will need well in advance.

3.      Smart Shopping

Coupons are your best friend. The mail, apps, and grocery stores’ flyers are just a few places where coupons can be found. Apps such as RetailMeNot and BradsDeals make it easy to compare prices at retail stores to guarantee that you’re getting the best buy. You’re right, comparing ticket prices for expensive items is crucial, but check for discounts on more affordable items, too.

4.      Sustainable Solution

Helping the Earth is incredibly important, but so is saving a couple bucks on your heating bill. Consider setting your thermostat just a few degrees lower this winter, especially when you’re not around. A few degrees may not seem like it would make much of a difference in your heating bill, but remember, every little bit helps.

5.      Air Leak Atrophy

Similar to the money-saver listed directly above, any air leaks in your house will contribute to an increase in your heating bill. Slowly leaking air may not be at the top of your list of things to fix in your household, but it’s an easy job that will produce a ROI.

6.      Starbucks Self-Control

“Sleep-deprived and busy, busy, busy” – we often hear these words when we ask someone how they’re doing. It’s true, Americans are busy, but we seem to rely on caffeine to replenish our energy. Caffeine isn’t the worst thing to be addicted to, but it does hit the bank account hard, especially when your coffee stop becomes a daily habit. Try cutting your coffee stops in half, or just stop on Fridays. Let that be your motivation to get you through the week.

7.      Show the Library Some Love

Rather than spending money on movies, books, or magazine subscriptions, drop by your local library to see what they have to offer. Many libraries provide free checkouts for countless books, various magazine subscriptions, and DVDs.

8.      Stop Subscriptions

Do you have random magazine or other subscriptions that you just don’t use? Save a few dollars and cancel it as soon as you can. It’s easy to bite on the “one month for free” bait, but if you forget to stop the subscription, you’ll be a quarter of the way up Mt. Everest before you realize that you don’t even read half of the magazines that arrive at your door.

9.      Exercise Economically

Naturally, exercise has a myriad of benefits, from keeping your weight in a healthy range to boosting your mental health and even improving your body’s health at the cellular level. Humans were created to move! Unfortunately, the cost of gyms and personal trainers can be outrageous. Instead, make a habit out of grabbing a friend to do an activity that doesn’t revolve around food or drinks. Try hiking, biking, taking a walk, or any other activity that gets you moving.

10.   Sidestep Shopping Online

Simply scanning your email inbox can be a slippery slope, especially if you’re one to get sale alerts from your favorite stores. Avoiding these promotions and sales can save you a lot in the long run. Using email filters, you can automatically send all of your promotion and sale emails to a special folder, limiting your temptation to see them right when they come through.

Saving money is a challenging task when everyone around you falls prey to the lure of retail. There are countless ways that you can save money in 2019, but it will take some discipline. Start with our tips and add a few of your own. Before you know it, your holiday debt will be reduced to dust and your savings account will start to grow.

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9 Smart Money New Year’s Resolutions for 2019

money new year's resolutions

Everyone looks forward to the New Year as a fresh start. This year, use your New Year’s Resolutions to benefit your wallet! From big goals to small changes, these 9 tips can get your finances on track in 2019:

 

  1. Eliminate/Reduce Credit Card Debt

If your credit card debt has gotten out of control in 2018, plan to make paying down your credit card balances a priority in 2019. With the Federal Reserve likely to increase interest rates this year, credit card debt is only going to become more expensive. Set a specific goal for yourself, (for example:  pay down 25% of your current debt). Focus on paying down the debt under the highest interest first to avoid income-draining interest rates. If you are struggling to make credit card payments, do not hesitate to reach out for help from Veitengruber Law.

 

  1. Pay Down Student Loans

For a lot of people, student loan debt is a heavy financial burden. It’s a great idea to take 2019 as an opportunity to make a huge dent in your student loans. Start by reviewing your loans and determining which ones have the highest interest rates. Making extra payments on those loans will save you money on interest in the long run. Paying more than the minimum due each month is also a great way to make sure you are not spending more than you should on interest. If your interest rates are high or you have a lot of different loans, consolidating your loans may allow you to get a lower interest rate and create more manageable monthly payments.

 

  1. Emergency Fund

In 2018, 39% of Americans paid for an unexpected $1,000 expense with their savings.* Many Americans end up in debt trying to cover unexpected costs. Most experts recommend having at least six months’ worth of expenses in savings, but if you are starting an emergency fund from scratch, make your goal something you think is reasonable to achieve. Even having a few hundred dollars in savings is better than nothing. You may want to consider setting up automatic transfers from your paycheck into a savings account so you are not tempted to spend this money.

 

  1. Improve Your Credit Score

The first step to improving your credit score is to know what it is in the first place. Signing up for free and reliable credit score monitoring through services like Experian or Mint will help you see how healthy your credit score is now. Good credit scores range from 700-749 and scores of 750 and higher are considered excellent. If your credit is not where you want it to be, make raising it your priority in 2019. Small things like paying your bills on time, keeping credit card balances low, and setting up automatic payments right after you’ve gotten paid can help reduce your debt and improve your score.

 

  1. Do Taxes Early

Filing for your federal income tax returns as soon as you can is a great way to start the New Year. Not only will you get your refund faster, it can give you extra time to pay taxes you may owe or help you avoid needing a tax extension. If you are expecting a big life change in 2019—like returning to college or buying a home—filing early will help you get a head start on this paperwork. For instance, students can use the information on their 1040 form to apply for financial aid. Plus, the sooner you apply for your refund, the less likely it is that you will be the victim of tax return identity theft.

 

  1. Cook More

Americans spend thousands of dollars a year eating out. A big way to save money in 2019 is to spend less time eating out and more time making your own food. Use 2019 as a chance to get more comfortable in the kitchen. Bring lunch from home, meal prep on the weekends, and spend some time researching quick-to-make meals. The more frequently you eat food bought from the grocery store, the less money you will spend—and the healthier you will be, too!

 

  1. Retirement Savings Plan

It is important to start saving for retirement as soon as possible. There are many options for creating a savings plan for retirement and you can determine which one is best for your specific circumstances. Maybe your employer provides a 401(k) plan, but if not – you can open an IRA or, if you are self-employed, a Simplified Employee Pension IRA. If you already have a retirement plan in action, reassess the plan in 2019. Could you be saving more? Are you on track for retirement?

 

  1. Home Improvements

While some home improvement projects will cost big and add value to your home, sometimes it’s the small projects that can have a big impact on your finances. Investing in energy-saving appliances in 2019 could allow you to save money every month on energy costs.  Energystar.gov has recommendations for energy efficient products and other home improvement ideas to get you thinking about ways you can save money on energy this New Year.

 

  1. Focus on Your Health

The average American spends over $4,000 a year on health care. Make your health a priority in 2019! Join the gym, focus on eating well, and take the time you need to relax. Go to the doctor at the first sign of illness instead of waiting until your health has been severely diminished. Preventative healthcare measures can save you big in the long run.

 

 

 

*From Bankrate

Budgeting in Retirement: Living Well in Your Golden Years

budgeting in retirement

Having a well thought-out budget is the best way to start your retirement on the right foot. Retirees must plan to have a form of steady income and create a budget that fits their expected lifestyle. In retirement, financial priorities will change with your changing lifestyle. It can sometimes be hard to determine what kind of retirement budget is realistic until you have entered retirement. While some people overestimate their expenses in retirement, some people struggle to adapt to life on a fixed income. For these reasons, it is a good idea to revisit your budget several times a year.

Retirement involves a lot of big changes, but one of the biggest changes is how most people get paid. Instead of receiving a weekly or biweekly paycheck, retirees typically rely on income that pays out once a month. On top of this, many people find their monthly income reduced in retirement. It can be a big mental shift for people entering retirement to suddenly adjust to all of these changes. Sometimes the best way to adjust your budget in retirement is to go back to basics. Here is how you can take one month to monitor and analyze your retirement budget:

Throughout the month, keep all receipts, payment confirmations, and a tally of any cash spent. It is best to record these expenses daily so you do not accidentally leave something out. Use a spreadsheet, notebook, or app to track your expenses. In tracking spending for a month, you can get a good idea of where your money is going. At the end of the month, sort your expenses into categories: groceries, dining out, entertainment, phone, utilities, housing, insurance, transportation, etc. Be sure to factor in irregular expenses like holidays and birthdays. Your expenses in December are likely to be a lot different than your expenses in June, for instance.

Next, analyze the results. This analysis is meant to be a realistic assessment of your lifestyle as it relates to your spending and income. Where is your money going each month? If your monthly budget was based on your pre-retirement lifestyle, you may see some significant differences between your expected spending and your actual expenses. Maybe you spend less on transportation and entertainment, but you spend more on eating out and medical expenses. Pay attention to these shifts in spending and make sure you are adjusting your budget accordingly.

After you have identified the trends in your spending, figure out where you can cut expenses. Determine which expenses are needs (like bills, housing, transportation, etc.) and which expenses are wants (like entertainment, hobbies, and gifts). In retirement, your “needs” may change. While you may have needed two cars when you and your spouse were working, is this still a necessary expense? Are you eligible for discounts to your cell phone or insurance plan? While you want to make sure you cover your essential expenses first, finding ways to make cuts to necessary spending will give you more financial freedom in general.

Finally, it’s time to put all these insights into your finances to create a new plan for your budget. Identify five goals that make sense for your income and expected expenses. Goals help you align your budget with the intention of getting the most out of your income. Make your goals specific and give yourself deadlines. Find ways to keep yourself accountable. Sign up for auto-pay, use an envelope system to categorize your spending, or get your spouse or partner to join you in your strides to reach your goals. A budget is only as good as your ability to stick with it!

You can do this financial check-in every six months or whenever your budget seems to be spread too thin. Sticking to a budget will help you feel more secure and relaxed so you can enjoy your golden years. Get your finances back on track by taking a fresh look at your retirement budget as we move toward the New Year!

8 Ways You are Wasting Money (and How to Stop)

money management

Some money saving tips seem obvious, like cutting back on eating out and sticking to a realistic budget. But there may be some things you are wasting money on without even realizing it. Being a smart consumer means looking at all of your expenses critically—even the little things. These are some common ways people waste money without even realizing it:

 

  1. Shopping Brand Name

This goes for everything from designer clothes to grocery items to pharmaceuticals. If you insist on buying only brand name items, you’re definitely overspending. Instead, look at the quality, function, and value of an item. For groceries and pharmaceuticals especially, the generic item is likely to contain the same exact ingredients as the name brand, but will cost you a fraction of the price. Don’t get hung up on big names; it will make a huge difference in your wallet.

 

  1. Overpaying on Car Insurance

Car insurance is a necessity, but taking the time to shop around and compare rates once a year can save you big. When it comes to car insurance, you can’t assume any one company is the cheapest. Different people will pay different prices for the same coverage which is why you have to shop around to make sure you’re getting the best deal for you. Check for discounts you may qualify for and make sure you’re getting coverage that makes sense for your car.

 

  1. Paying for Cable

There are dozens of movie streaming services and non-cable TV options on the market today—and those services are always growing. Almost any streaming service is cheaper than cable or dish and you have the added bonus of paying for exactly what you want. You can build a package catered to your interests instead of having to pay for extra channels you never use.

 

  1. Keeping Electronics Plugged In

Saving money on energy goes beyond turning lights off when you leave a room. You would be shocked at how much energy waste you produce just from leaving devices plugged in. Some electronic devices, like computers, DVD players, and even microwaves will use power even when they’re not in use. You can calculate what these devices are costing you using this tool from Duke Energy. Keeping these devices unplugged can save you money on your electric bill.

 

  1. Piling on Credit Card Debt

If you use your credit card to pay for most things, it’s a lot easier to spend outside your budget unless you are vigilant. Credit card debt can add up quickly if you aren’t keeping up with your monthly payments. If you fall behind, you may find yourself spending so much money on interest that you can never catch up enough to pay off the actual balance. Don’t ignore potentially crushing interest rates. Be proactive by looking into consolidating or refinancing debt.

 

  1. Spending Too Much on Gas

Overpaying on gas can really hurt your everyday budget. Pay attention to changing prices and shop around for the cheapest gas station in your area instead of just going to the closest one. You can even go a step further by earning rebates on gas purchases. Some credit cards will net you 5% cash back when you buy gasoline. Shopping with certain stores can help you get gas discounts, too. Giant, for example, will help you save 10 cents per gallon for every 100 points you earn at Giant grocery stores.

 

  1. Overpaying Monthly Bills

Just like with car insurance, reviewing the amount you pay for your cable, internet, or cell phone provider is essential to making sure you’re getting the best deal. Some companies rope you in with discounts and monthly credits that expire after your first few months paying for the service. Don’t let that be the final word on your monthly payment. A lot of the time, if you call your provider to discuss a payment increase, they will work with you to keep your business.

 

  1. Not Earning Cash Back When You Shop

There are dozens of apps out there that give shoppers money back for their purchases. Some apps will pay you for scanning your receipts from specific stores while others will give you cash back on individual items. Ibotta and Fetch Rewards give you cash back for scanning your grocery and retail receipts. Ebates and Shopkick give you cash back on specific items from qualifying retailers. A lot of these apps have cash sign-up bonuses. Using cash-back apps is a great way to earn a little money back when you shop.

 

All of these little ways to save money can add up big time in the end. Taking advantage of new technology and competitive pricing will give you more financial power as a consumer. Use these tips and start saving today!

10 Easy Ways to Improve Your Finances

improve your finances

  1. Start saving
    It seems obvious, but many times it also seems impossible. By the time you pay your bills and have some spending money, every paycheck seems to fly out the window. The easiest way to save is to make sure you never have the chance to spend those funds in the first place. Most people have direct deposit these days; set up an automatic transfer of 10% of your net pay into a separate savings account each pay period. You won’t miss it, and it builds up pretty fast. When you get a raise, try redirecting the entire difference in your net pay over to savings. Your net pay will seem unaffected on your end, but your nest egg will grow that much quicker. You will be prepared for an unforeseen expense like an emergency car repair or for a “rainy day” when you want to take a long weekend out of town with friends.

 

  1. Make a budget – and be realistic
    Determine your starting point by keeping track of every dollar spent in a month. Now separate each expenditure into a category: utilities, housing, food (groceries), eating out, entertainment (movies, clubs, golf, etc.), childcare, transportation, car payment, and so on.Where are most of your discretionary funds going? See if there is anything you can cut back on or cut out altogether. If you have a wicked Starbucks habit, you might decide you can do without that daily grande latte after seeing that you are spending over $80 a month on coffee. Don’t want to quit your Starbucks habit cold turkey? How about only getting that latte once a week (say only on Fridays or Mondays) instead? Your $80 a month expense just went down to $16. You can’t decide to live on canned soup five days a week – you know it’s not going to happen, so don’t set yourself up for failure. Look at where your money has been going versus where you want it to go.

 

  1. Little changes can make a big difference
    As you saw, coffee can be a bigger expense than you realize. There are a lot of those little things that can suck money out of your wallet. Limit your dinners out each month. Make the transition less painful by allowing yourself one or two fancy dinners out, but eat at home the rest of the time. Pack your lunch. Join a carpool. Use a filtering pitcher, such as Brita ™, instead of buying bottled water. Feed a meter instead of using valet parking. Shop for clothes at consignment and second hand stores; you might even find higher quality items than in a big box store! Cigarette smokers spend hundreds of dollars a month on a product that they literally set on fire. That type of savings might make a lifestyle change a real incentive. It all adds up.

 

  1. Lower your existing monthly bills
    If you’ve always made payments on time, call your credit card company and see if they are willing to lower your interest rate. If you haven’t reviewed your cell phone plan in a year or more, it’s time to compare new deals and potentially cut your costs in half. Consider whether you really use that gym membership. If you barely go, it’s time to cancel it. Consider workout alternatives like YouTube videos or running groups. If a brick and mortar gym is where it’s at for you consider this; membership deals are generally better in the summer when everyone else would rather exercise outside. You could get those initiation fees waived or get a lower monthly rate.Shop for cheaper car insurance. Lower your electricity bill by using timers and power strips, and your water bill by checking for leaking faucets or toilets. Look into local weatherization programs that can troubleshoot conditions in your home to prevent wasting money on heating and air conditioning. Many times these programs are run by your utility company or local government and are free.

 

  1. Set goals
    Hard decisions are easier when you see the payoff at the end. Want to take vacation? Set up a retirement portfolio? Send your kid to college? Keep that in mind when you’re setting up your budget, or deciding if it’s really worth it to go to Olive Garden tonight, or if you really need yet another pair of black shoes.

 

  1. Check your credit reports
    The three major credit reporting agencies are Experian, TransUnion and Equifax. You are entitled to a free report annually or whenever you are denied credit directly from all three agencies. Look for mistakes and dispute them! This is even more important if you have a common name or share a name with someone else in your family. Check your credit report for bills you forgot about or never received. Maybe there’s an old bill from a dentist that got lost in the mail or never got forwarded when you moved. Even a small bill that went to collections stays on your report for 7 years after it is paid off. A low or lower credit score can mean increased interest rates or outright denial of credit when you need it most.

 

  1. Don’t pay full price – for anything
    Clip coupons; look for online deals, shop sales. Get discount codes from places like ebates.com, retailmenot.com, or slickdeals.net. Look for Deals of the Day on Amazon. Utilize discounts for services or experiences by using Groupon and Living Social.

 

  1. Change where you bank
    Many banks are rife with fees. Fees for less than a minimum balance. Fees for ATM use. Fees per check. Shop around, find a bank that values your business and doesn’t drain your account when you want to use your money. Veterans and business owners can often get even more perks, such as free certified checks or safety deposit boxes.

 

  1. Utilize employment benefits
    Your benefits package at work can offer a lot more than you think. Does your employer offer matching incentives for retirement account deposits? Flexible spending accounts? Free counseling or other wellness support programs? Take advantage of everything you can.

 

  1. Make sure you are financially informed
    Understanding basic concepts when it comes to investing, spending, saving, interest rates, etc. will benefit you (and your bank account) in the long run. Find out if your employer offers programs on these subjects, or seek them out yourself through online videos or books by consummate professionals in the field. If you have a personal accountant or financial planner, ask questions and ask for advice and heed it! You can’t make good choices if you don’t have the background information needed to make them.

How “Keeping up with the Joneses” can Send You into Bankruptcy

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What exactly is “Keeping up with the Joneses”?

 

“Keeping up with the Joneses” is a phrase that originates from a 1913 New York Globe comic strip by Arthur (Pop) Momand. The use of this coined phrase now refers to the actions of striving to keeping up with one’s neighbors in reference to social status and spending. “Keeping up with the Joneses” sometimes begins to happen for an individual when they bear witness to a neighbor or loved one coming into a large financial windfall – perhaps by winning the lottery. The neighbor may start to spend their newfound money on luxuries like cars, vacations, clothing, etc. This inspires said person to begin spending money outside their means to compensate for jealousy of the newly rich neighbor. Unfortunately, these actions can lead to debt, financial crisis, and bankruptcy.

 

Take the story of NJ lottery winner Pedro Quezada, formerly from the Dominican Republic. Quezada was from Passaic, New Jersey, and winner of $338 million. After hitting the jackpot, Quezada (owner of a local bodega) proclaimed he was thrilled because he could properly take care of his family.  Spending immediately began, but maybe not in the exact way his neighbors anticipated.  He was constantly approached by frequent customers of his bodega and friends of his looking for handouts, some traveling from as far as Colombia. There were even several false reports on news outlets claiming he declared to pay the rent for his neighbors, and eventually this led to a falling out with them. In fact, Quezada was even sued by his live in girlfriend of ten years for half of his winnings a year after winning the lottery. Eventually Quezada’s attorney won the case because the couple had never been married therefore his ex-girlfriend was not entitled to any of the winnings.

 

Unrealistic expectations

 

Suppose you have a neighbor (or family member) who just won the lottery. They decide to throw a lavish party to celebrate and show off their windfall. Maybe they add in that in-ground pool they have always wanted, or purchase that car or boat they had been dreaming of, and while they’re at it they make upgrades to their landscaping and home. These types of actions can cause a trigger effect with neighboring individuals who begin to look for ways to get rich quick or take out a loan much larger than they are capable of repaying just to be able to unrealistically and irrationally upgrade their lifestyle to keep up with their newly rich friend or loved one. This is a common theme that leads more often than not to bankruptcy and financial crisis.

 

Managing your money well

 

Watching someone win the lottery may seem like a super exciting event, and you may feel inspired to make rash decisions which can then result in irresponsible spending. Our advice? Forget about “Keeping up with the Joneses.”

As an NJ bankruptcy attorney firm, we at Veitengruber Law focus on aiding individuals with managing their debt and finances more realistically to protect their assets in order to avoid bankruptcy. If you feel as though you are lost in your expenses and debts because you’ve tried to live beyond your means, please reach out to us PRONTO. We can help, and we WANT to help.

How Financial Stress Affects Your Health

Would you be surprised if someone diagnosed your change of appetite, difficulty sleeping, and incessant headaches as symptoms of financial stress? It might be a hard pill to swallow, but your financial stress can have a tremendous impact on your health.  According to a survey published by the American Psychological Association in 2017, 62% of Americans reported being stressed about finances. Unbelievably, financial stress can cause companies upwards of $520,000 per year! You’re probably asking “why?”


Are you aware of the impact of stress on the human mind and body? You’re about to find out.


Financial stress, and many other kinds of stress, can have a negative impact on your health. There is a positive, temporary response to stress, and that is known as the “fight-or-flight” response. Preparing to run a race, giving a presentation, performing, and being involved in a dangerous situation are all examples of when your body is going to react with the “fight-or-flight” response, or adrenaline rush. Heart rate quickens, pupils dilate, brain functions heighten, and oxygen intake increases as your body reacts to the scenario. This is helpful in the short-term, but in the long run, on the other hand, it can become extremely harmful.

If these stressors are present over a long period of time, other health issues will manifest. Have you ever heard of heart disease? That’s a rhetorical question, since it’s the leading cause of death in the United States for both men and women. Guess what? Chronic stress is one of the main contributing factors to heart disease (along with a poor diet and lack of exercise). Not only is heart disease intensified by stress, but migraines, sexual dysfunction, asthma, gastrointestinal issues, high blood pressure, diabetes, general pain, stomach ulcers and many other health complications are also correlated with stress – money worries in particular.

We know that when you’re stressed, you’re more likely to make decisions that aren’t always the best. But when you accidentally, or purposefully, make a choice that ends up being detrimental, stress will follow. For example, the fear of not being able to pay next month’s mortgage bill can initiate symptoms of depression or PTSD. In turn, this can lead to even more issues with budgeting and over-spending (like racking up your credit card balance to make yourself “feel better”), which only exacerbates symptoms.

In the same way that stress exacerbates physical issues, it can also aggravate psychological problems such as anxiety, sleep disorders, depression, anger issues, and hopelessness. About 10% of high-earning individuals experience 2 to 3 indicators of depression, in comparison with 23% of low-earning individuals. Pair together financial stress and depression, and you’ve got a crippling combination. It definitely isn’t a recipe for productive and satisfied employees. Each day it seems that employee health is worsening, so it’s crucial that employees, managers, and health care professionals work to decrease stress levels and improve coping skills.

Although many of us brush off money worries, the physiological effects actually make sense. How can your body thrive if it’s constantly being beaten down with the incessant worry of money troubles? Simply put: it can’t. The physiological response of the body to stress is so immense that physical and mental health quickly begins to suffer. The lower classes of America undoubtedly experience the effects of financial stress, but studies show that financial worries also plague middle and upper class individuals.

In the United States, approximately 75 to 90% of all doctor’s visits are stress-related medical issues according to The Journal of the American Osteopathic Association. We know that stress causes plenty of medical issues, but some of that can be attributed to unhealthy coping skills. When people are stressed, they tend to resort to unhealthy coping behaviors such as overeating, overconsumption of alcohol, etc., which only worsens other medical problems. Stress management techniques such as exercise, deep breathing, and meditation are all effective ways to lower stress levels.

The heaviness of financial stress can weigh you down, but it’s important that you and those around you find successful ways to decrease stress levels and develop helpful coping skills. Lifting such a weighty burden requires intelligent money management and more important, stress management.

Self-Employment Budgeting Tips

nj asset management

When you’re not working a 9-5 job with a stable, predictable salary dispensed into your bank account on a set schedule, budgeting for recurring monthly expenses can be a bit tricky. While being self-employed can afford you the freedom to work flexible hours, have a varied office location and the ability to do something you love, it does not always provide the easiest and most consistent stream of income to rely on. This is where careful, diligent budgeting comes in handy.

 

1) Always budget for the necessities first!

While you are most certainly deserving of a dreamy resort vacation this summer, that doesn’t mean it qualifies as a necessity, as your vacation can easily be delayed until you can truly afford it. Necessities solely include staples like your rent or mortgage payment; groceries, gas, medical insurance, car insurance and car payment or other required transportation costs; utilities like electricity, phone, internet, water, sewer and garbage. It is also critical that you budget for your income taxes, as they will no longer be automatically deducted from your income. Anything else not featured on the aforementioned list does not qualify as a necessity and therefore you can live without it and save up for it before purchasing it.

 

2) Establish an emergency fund.

If you haven’t done so already, creating an emergency fund that has enough money to sustain 3-6 months worth of your necessary expenses is an absolute must for the self-employed. Not only does this provide you with added financial security and stability, it also buys you time to find a new job or side gigs if your self-employment opportunity does not prove lucrative enough to afford your expenses.

 

3) Once you have your emergency fund in place and have mastered budgeting comfortably for the necessities and have some wiggle room left over in your budget each month, you can start budgeting for “little luxuries.”

When I say little luxuries, I mean just that. Not living large, but treating yourself to small and affordable indulgences in moderation but on a regular basis. This may include something as mundane as ordering a Netflix subscription and Chinese takeout once a month, or something as exhilarating as a night out at a rock climbing gym with friends depending on your tastes and interests.


Pro tip: seek out experiential luxuries whenever possible as they don’t generate physical clutter that you’ll have to deal with down the road. The memories you’ll gain are much more valuable in the long run.


 

4) Think big: now that you’re managing all your monthly expenses (including little luxuries) like a pro and have a solid emergency fund in place, it’s time to consider your long-term financial goals.

When you’re self-employed, saving for retirement is even more important than it is for your peers who participate in employer-sponsored retirement programs. Given that you don’t have the opportunity to participate in employer-based matching programs, you will need to be proactive and learn to not only save diligently toward your retirement fund, but also actively invest your money wisely to make it work for you. There are tons of great retirement-planning resources available online, but if you’re feeling overwhelmed at the prospect of managing your own retirement accounts, consider consulting with a local retirement specialist who can help get you on the right track. If you’re more concerned about meeting more immediate financial goals like purchasing a home or a new vehicle (or even that resort vacation), a financial planner will be able to help you adequately allocate funds for each important goal while still contributing to your retirement so that it can continue to grow as you meet your other major milestones.

Veitengruber Law can guide you through your NJ asset management needs as you get older; with advances in medical care extending life expectancies, you may be facing difficult choices over health care and your legacy. We also have close relationships with expert financial planners and NJ CPAs with whom we are happy to connect you.

Budgeting Basics

Creating a budget is certainly not a walk in the park. Budgeting is an ongoing process and for most people, your budget has the possibility of changing from month to month. Your first try won’t be perfect, but don’t get discouraged.  As with most things in life, the more you practice budgeting, the better you’ll get. Once you figure out a flexible and successful process that works for you, you’ll be ready to go! Before you start, make sure you have 30 to 45 minutes set aside to work through each step. Let’s get started!

Income

Let’s begin at the most obvious place: your income. As we all know, your income is going to determine your budget, or in other words, how much money you have to spend. Your income can come from a variety of sources: your main day-to-day job, side jobs, child support, or even rental properties. It includes any source that brings money into your household each month. To start creating your budget, record the total amount of money that you’re making.

It’s important to take taxes into account, so make sure you’re recording your monetary income post-taxes. Some people refer to this as your “take home pay.” If you’re married, you’ll potentially be combining your incomes, so record them on the same budget.

Plenty of people are self-employed, which makes a budget all the more important. Your month-to-month income may be unpredictable depending on your business. If you have no reason to believe that your income will significantly drop in the upcoming month, average your monthly income for the last 3 months and use that for monthly income.

Expenses

The next part (that no one likes to think about) is what you spend your money on. Though expenses have their own categories, you always have regular “offenders” every month like your utilities, mortgage, or car payment. Sometimes utilities can sway a bit from month to month, but in general, they stay consistent.

You can’t forget about the other necessities like groceries, gas, clothing, household necessities, and other miscellaneous items. For your budget, it’s important to take into consideration everything that is going to require money. Depending on your family’s spending lifestyle, do you need to add or delete any categories? Think about this before moving on to the next step.

Set Priorities

Maybe you have student loans to pay off or maybe you and your spouse have a baby on the way. No matter what situation you find yourself in, your budget health relies on how well you prioritize.

  • Groceries: You have to feed you and your family, so first and foremost, set aside enough money for food. This should come before you worry about other bills. You may have to adjust it a bit depending on other expenses.
  • Utilities (Electric, Water): You have to keep the water running and the lights on, so these should take next priority. You might be asking, “isn’t my mortgage more important?” Well, living in a house without lights or water is no fun. The utility company won’t wait to turn your water and electric off if you don’t pay them. You tend to have slightly more leeway with your mortgage payment.
  • Mortgage or Rent: Don’t put this off unless it’s a dire emergency. Stay on top of it and don’t let it slip to the bottom of the pile!
  • Gas/Fuel: You have to put gas in the car to get to work, and if you can’t get to work, well, you’re not going to need a budget. (This is not a good thing!) Pay the monthly car payment and keep some gas in the tank. Tip: Be smart about your trips or try carpooling.
  • Clothing: You need to look appropriate at work and the kids need to be dressed for school, so if you’re only spending money on necessary clothing, that’s great! Don’t feel required to buy name brand clothing or accessories.

Once you’ve covered these 5 categories, you can move on to other sections of your budget that may vary from person to person. If you still have money left in your budget, you can include things like: Date Night, Cable, Family Entertainment, and other fun categories that should only be a part of your budget if you can afford to spend real money on them (not credit).

Final Touches

Many websites have free budgeting templates that will get you started. These make it pretty easy to figure out spending for monthly bills, since they don’t change much. You will have to make an estimate for gas and groceries. We suggest looking over your spending for those categories throughout the past couple of months and then finding an average. It doesn’t have to be perfect, but you do want the most accurate idea of where your money will need to go.

Once you’ve figured out your grand total of expenses, you want to make sure that it doesn’t add up to more than your total income. If you end with a negative number, you’ll need to go back through and see what unnecessary spending can be cut out. If Income – Expenses = $0, you’ve successfully created your first budget! Some people prefer to have their final number greater than $0, just to provide a little wiggle room. This is naturally preferable so that you can begin to build up a small savings.

As you go through the next few weeks, chances are, you will have to make some edits to your budget. This is more than okay. Remember, it’s a process and it takes time to figure out. Don’t be discouraged at the thought of having to create a budget; instead be proud of yourself for taking a step towards managing your money skillfully.

Top Ten Money Saving Tips for Healthier Living

Cut coffee out of your budget (or at least brew it at home!)

If you have a daily caffeine habit you’d like to kick, let all the money you’ll save by cutting it out of your daily routine serve as an extra incentive to help you achieve that goal! However, if you are among the lucky folks who can enjoy coffee in moderation, there’s no need to deprive yourself even from a daily coffee habit. Just try to avoid coffee stands and restaurants where coffee is costly. Instead, consider investing in a home coffee machine like a cartridge coffee maker or an espresso maker, a reusable travel mug and even a milk frother if you prefer more gourmet-style drinks. These fancy gadgets can be more affordable than you think and will easily pay for themselves within a month or two if you’re a regular coffee drinker. Home coffee makers are convenient and easy to use, and reusing your own mug everyday also has a positive impact on reducing your carbon footprint to help protect the environment.

 

Clip online coupons from the convenience of your home computer

When people think about clipping coupons, it often sounds tedious to go through the newspaper and find relevant coupons each week. However, there are dozens of reputable websites online that offer both printable coupons that can be used in-store and coupon codes that can be used at online retailers. Anytime you’re about to make an online purchase, be sure to search your favorite coupon sites like Retail Me Not or Coupons.com to make sure you’re not eligible for any additional savings, a free gift or free shipping before committing to a purchase.

 

Seek out deep discounts at the grocery store

Did you know that every grocery store puts items on sale that aren’t even advertised in their weekly circular? That’s right! By knowing where to look you can save yourself even more money on your weekly grocery bill. If you’re looking for a dinner to cook the same night you shop, check out the butcher’s counter or the deli counter for discounted items that are close to their expiration date. There is absolutely nothing wrong with the reduced price food items, but they need to be prepared and consumed within a day or two in order to be guaranteed fresh. Many grocery stores also have a clearance section filled with pre-packaged, non-perishable and often seasonal items (think organic Easter candy!) they are closing out.

 

Cook and meal prep at home more to avoid buying lunches out

While eating out can be a fun experience to occasionally treat yourself to, eating out regularly can really dent your budget and your health! Even cheap fast food meals add up quickly, not to mention they aren’t the healthiest options with which to fuel your body. By always bringing a lunch and/or snacks to school or work you will be less likely to succumb to the temptation of eating out or pulling up to the drive-through window when hunger hits. Bringing lunch from home will save you a ton of money over the course of a year and even over the course of a month.

 

Cut back on trips to the salon by DIY

While treating yourself to an occasional trip to the salon should not be forbidden, try to limit the number of times you go to the salon every year. By purchasing a couple bottles of nail polish in your favorite colors and investing in a good quality nail file, with a little practice you can often achieve a salon-quality result at home. Recruit your best friend or significant other to trim your hair between salon haircuts. You can also successfully deep condition your own hair at home and even color your own hair at home for a fraction of the cost if you have a willing helper and a little patience.

 

Call your cable, internet and phone service providers to negotiate a discounted rate—whether you’re a new customer or not!

If you’re in the market to switch companies, now is the time to capitalize on the new customer discounts! Make sure to always inquire about their new customer rates any time you switch service providers. However, even if you’re an existing customer, it’s always worthwhile to call your providers periodically and ask them about any current promotions in your area and customer loyalty specials. You’d be surprised by the amount of money you can save just by asking.

 

Review your insurance policies

Call your insurance company to find out if you’re eligible for any multi-policy or multi-car discounts, non-commuter policies and safe driver discounts. If you have teenagers behind the wheel, ask if your insurance company offers a discounted rate for good grades. Your insurance company may also offer a discount for having extra safety features on your vehicle.

 

DIY your own all-natural cleaning products

Chemical cleaning products are not only expensive, they are also bad for your health! There are several inexpensive and effective alternatives that are much safer than most pre-made cleaning products you can buy at the store. Baking soda, vinegar and hydrogen peroxide are all extremely affordable cleaning staples that you likely already have on hand in your pantry or medicine cabinet that can be used as key ingredients to make multiple cleaning products (think window cleaner, dishwasher tablets, toilet cleaner, etc.) easily and at a fraction of the cost of what you would pay to purchase each product individually. There are many informative video tutorials available online that will walk you through how to make your own all-natural cleaning products from scratch. After you’re done making your own products, you will have a powerful, safe and effective arsenal of cleaning products at your disposal.

 

Use apps to find the lowest gas prices

There are so many free and inexpensive apps that can help consumers uncover extra savings nowadays, even on necessities like gas! Special gas tracker apps find the lowest prices in real time and even show you where the gas stations are located on a map. This is a great option if you live in or nearby a city with multiple gas stations to choose from. Prices are always changing, so be sure to check before you fill up your tank each time.

 

Try consignment shops for clothing—buy, sell and trade!

Consignment shops are a great way to save on high-quality, gently used and sometimes even never-been-worn clothing. Even if you’re not in the market to purchase any new clothes, consider consigning, trading or selling your gently used clothes to a consignment shop to earn some extra cash and clear some clutter out of your closet while you’re at it!