Emergencies!
April 30, 2008
If you're new here, I invite you to subscribe to my RSS feed. Thanks for visiting!
This is part of our Financial Literacy Month Question and Answer series
Question: I always seem to have car emergencies. Isn’t there a better way to live?
Answer: Create an “Anti-Emergency Savings Fund “for normal and necessary expenses that do not occur every month. For example, you can pay your property taxes with your mortgage, save 1/12 of it every month, or just have an “emergency” when it shows up every year. By saving small amounts every month, you will actually have the money available to pay your property taxes when they are due. No more surprises!
The same is true with other types of normal expenses like car repairs, home repairs, school fees, holiday gifts, medical bills, etc. Even vacation!
Warmly, Cindy
Doctor’s Finances
April 28, 2008
This is part of our Financial Literacy Month Question and Answer series
Question: I’m a doctor and my finances are a mess! I make good money but I’m behind in taxes, I have too much credit card debt and I bounce a lot of checks. What can I do? ~ Dr. Debbie
Answer: Hi Dr. Debbie, I’ve worked with a lot of different Health Care Practioners and your situation is shared by many.
First, most of you start off with a lot of student debt and many years of deprivation.
Suddenly, you’re making a “lot” of money. Some make up for lost time by purchasing a lot of toys, others get behind in paying their income taxes. Either way, you woke up one day and found yourself in trouble, right?
While there are some basic things you can do, this is a good time to start working with someone like me to address your particular situation. Just like your patients, there’s no “one size fits all”.
Here are some basic things to do:
- Get a clear vision of where you’d like to be in 6-12 months. These goals can help you make spending and saving choices that will help you achieve the goals.
- Start using cash for purchases instead of your credit cards. If you have credit card balances, any new purchases get charged interest immediately — no grace period.
- Take the minimum credit card payments from this month and make the same payment every month regardless of what the card says. If you’re not using your credit cards for new purchases, the balances will start to go down.
These same items work for all professions and walks of life. It is hard to do this on your own. I have coaches I work with, too.
Warmly, Cindy Morus
Quick and Easy Ways to Make Extra Money
April 27, 2008
This is part of our Financial Literacy Month Question and Answer series
Question: Cindy, do you have any quick and easy ways to make extra money? I’m interested in putting some into savings and paying off some debt, too. Thanks. ~ Jayne
Answer: Good question, Jayne. There are many ways to make extra cash even when you are working full time. One of the best ways to make more money in your spare time is to do something you love and to find someone who will pay you for it. Here are a few and I invite readers to add their ideas in the comments below.
- Collectors, computer savvy individuals, and the natural salesmen can all make a few bucks by setting up an eBay account and selling all the items they have stored around the house. If it’s boxed up and covered with dust then you aren’t using it. Why not send it to someone who will truly appreciate it, and you can appreciate the cash in its place.
- Almost every weekend, somewhere in the United States, some city or town is holding a fair or festival that offers booth spaces for crafters. Get your hobby to work for you by attending some the festivals and selling the items that you have been giving away as gifts. It might help to visit a few first to get a feel for the different crafting trends and the best locations for your booth space.
- Digging in the dirt is not for everyone, but almost everyone loves to have a beautiful yard. If you have a green thumb, then why not offer to share that with others. It might be surprising how many people will take you up on the offer. It will probably be downright shocking how much they are willing to pay for the service. I know I’d love to have some help in this area!
- If you don’t want to labor away in other people’s yards, then why not sell the fruits of your labor from your own yard. Pot up some of the multiplications your plants have grown and sell them at the local flea market. Find a local farmers’ market to sell excess fruits, vegetables or flowers.
- Take seasonal or temporary work - as long as it doesn’t interfere with your full-time job and you still have some time to yourself. A part-time job can be the perfect way to make that extra income you need for a special goal.
If you need some extra income or just want to make some quick or easy cash, then look at what you have. Sell off anything that you don’t need or want, use your skills or talents to meet needs that others may have, or take a part-time job to reach the financial plans you have for your future.
Good luck to you, Jayne!
Warmly, Cindy
Separate Accounts for Business and Personal Expenses
April 25, 2008
This is part of our Financial Literacy Month Question and Answer series
Question: I want to start a business. Do I need a separate checking account? ~ Monica
Answer: Monica, with a small business it is very easy to mix business and personal expenses especially when you’re just starting out.
For some people the business started out as a hobby or a way to make a little extra money on the side. There wasn’t much thought to profit or a permanent enterprise at the time. All of the money funneled into one account.
Then, things began to snowball and soon you were making money hand over fist. As a sole proprietor working for yourself, the government categorizes you as “self-employed” for tax purposes. Once you make over $400 in a year, you have to pay taxes on your business profit. Having only one account makes things much more confusing for you and your tax accountant.
Business expenses are items or services directly related to the business and its management. Business expenses can be deducted on your tax return if you are self-employed. Personal expenses cannot. If everything is in one account it is hard to separate the two convincingly and may raise a red flag with the IRS.
If you haven’t already, start a separate business checking account. All business deposits and expenses should be paid for out of this account (including your salary).
Keeping things separate also helps you to see if your business is profitable (the major goal of owning your own business, of course).
Warmly, Cindy Morus
Rebate Bribe: Don’t Buy It!
April 24, 2008
I’m mad as he– about the Rebate being sent out by Uncle George and the yahoo Senators and Representatives! This is costing us arm and a leg just to send it out (including letters to all taxpayers, re-tooling the IRS computers, and preparing the payments — and that doesn’t address where the money for the rebate is coming from) that our country just does not have. And it’s all about politics!
So, I’m voting with my pocketbook and I’m not spending it! The folks over at The Simple Living Network have started a NonViolent Protest called “Don’t Buy It, Change the Economy, Put Your Rebate to Work!” They list a number of ways you can participate.
- Pay down high interest credit cards or other debts.
- Put your rebate in a savings account.
- Donate your rebate to those working to end poverty, promote environmental responsibility, peace, justice, or equal rights for all.
- If you must buy something, purchase goods and services that support your local economy or save money, energy and resources in the end:
- Locally grown fruits and vegetables
- Fluorescent light bulbs
- Water heater blankets
- Water saving showerheads
- Insulation (and a local, self-employed contractor to install it)
- Don’t stop: do the same with your 2007 tax refund.
- Put “Don’t Buy It” In Your Signature Line. Here’s an example:
“Wake Up & Smell The Rebate - Don’t Buy It - www.SimpleLiving.net”
They also have logos you can add to your signature or website.
- Write your Elected Officials. Here’s a sample you can use:
| Dear Representative,This email is to notify you that I will not use my tax rebate on consumer spending. I believe the rebate is a misguided attempt to bolster an unsustainable economic system. I will not use this bribe money to support consumption as an economic solution, deficit spending, predatory lending, unaffordable health care, tax cuts for the wealthy, and war over oil and religious ideology.
Rather than support that decision by spending this rebate on consumer goods, I will: 1) pay down my debts. If our government continues on this path, I will also use my 2007 tax refund similarly. How we spend our money is how we vote for what exists in this world. I am registering my vote with you. Sincerely, [your name here] |
They also have a Flyer you can download at Wake Up & Smell the Rebate and put up around town.
See the previous post for a way to get an additional 10% out of your rebate when you spend it on groceries.
Warmly, Cindy
P.S. My rebate is going into college funds for my teenagers.
