Manage Your Financial Life

Career Transitions

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It is particularly important to analyze your cash flow, which includes your income, recurring expenses, savings, and debts, before making a big transition, such as changing careers or starting a business.  Explore our tips and helpful advice for this stage of life.

Tackling Your Credit Card Debts

Analyze Finances

There are different approaches to tackling your credit card debts. The best approach for you depends on your individual situation. Start by listing the outstanding balance for each debt, along with the minimum payment due and available credit line. For each outstanding debt, you must pay the minimum balance due every month. To achieve your goal of digging out of debt, you must find additional cash every month – by cutting back on day-to-day expenses or finding ways to earn extra income – and apply that cash toward your debts. The main difference between these approaches is the order in which you tackle your various debts. Start with the Smallest Debt Balance Some recommend that you focus first on the smallest outstanding balance (Debt A). After paying the minimum balance due on each of your debts, apply any extra money to Debt A until it’s paid off. Once that debt…

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Evaluating Risk: How to Underwrite Yourself

Analyze Finances

Underwriting is what banks or insurance companies do when they evaluate risks associated with lending money or providing an insurance policy. To underwrite yourself, you need to take a close and honest look at your finances, ask yourself some questions, consider uncertainties and exposures, and evaluate your risk profile on many fronts. Analyze Your Sources of Income The first consideration is your income. Ask yourself these questions: Is your salary steady or variable? Do you rely on commissions or bonuses? Do you work in a cyclical industry? If your compensation is variable, you should not carry a lot of debt. Likewise, you should make sure to have an ample cash reserve. Evaluate Your Debt When you are thinking of buying a big item, consider if you can actually afford the item, not just whether or not you can afford the payment. Commit to paying off your credit card balances every…

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How to Dig Out of Debt

Analyze Finances

Prior to the coronavirus outbreak, the US economy was doing quite well. The unemployment rate was near record lows. Housing values nationwide were climbing, as was the stock market. Despite these favorable economic conditions, Americans continued to take on debt. According to the Federal Reserve, aggregate household debt totaled more than $14 trillion as of March 31, 2020. This amount exceeds the prior peak, which occurred in the third quarter of 2008. Because there is a short delay in reporting individual credit figures, The Federal Reserve cautions that these figures do not fully reflect the impact of the COVID-19 shutdown that began during the last two weeks of March. There is economic uncertainty ahead, so people must analyze their finances and work to strengthen their situation. Getting out of debt must become a high priority. There are different approaches to dig out of debt. The best method for you depends…

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How Much Coverage?

Good to Know

It is a new year and a new decade. Resolve to get your financial house in order. Making sure that you have adequate insurance should be an item on your “to-do” list. The nonprofit Life Happens teaches people about life insurance and disability insurance. When it comes to insurance, there are many considerations. Your situation and life stage are unique. The site offers calculators so consumers can determine but how much coverage they require. Being thoughtful about your insurance needs helps protect your loved ones and your budget. Check out the site LifeHappens.Org

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Strategies to Stay Out of Debt

Analyze Finances

Establishing sound personal finance practices while you are young is essential. For those just starting out who are new to money management, you need to consider your financial future. Discipline and having the right mindset will help you stay out of debt and achieve your financial goals. Track and Analyze Your Spending The first step is to analyze your spending to see where your money is going. Limit yourself to one or two credit cards, using one for most day-to-day purchases. This makes it easier to track spending and your total credit card balances. Having multiple credit card accounts is a major reason that card debts grow. As credit card balances climb, it also hurts your credit score. Even if you can pay off your balance every month, using more than 30% of your credit line has a negative impact on your credit score. Peer-to-peer (P2P) networks offer convenience and…

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Working Moms: Take Care of Your Retirement

Save and Invest

Women take on many roles throughout their lives – daughters, wives, mothers, and, increasingly, entrepreneurs. According to American Express, the number of U.S. businesses owned by women continues to rise and exceeds 12 million. The growth is not fueled by female millennials; two-thirds of women business owners are 45 or older. Women business owners need to diligent and disciplined about planning for retirement. Whatever your timeline, there are many unknowns—where and how long you will live, how much money you will need for day-to-day expenses, the state of your health. Many women find the retirement planning process intimidating. However, it is important to start thinking about the unknowns and variables now, regardless of your age. Make a Plan As we are living longer, we need to plan for a longer retirement, especially since women tend to outlive men. According to the Social Security Administration, a 65-year-old woman on average will…

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Strategies to Dig Out of Debt

Analyze Finances

Want to dig out of debt, but not sure of where to start?  In this post, I’ll fill you in on everything you need to know to create your own strategy to dig out of debt, effectively. First the good news: The unemployment rate is near an 18-year low. Housing values nationwide continue to climb as does the stock market. Now for the bad news: According to the Federal Reserve, total household debt has risen for the 15th straight quarter. This may appear counterintuitive. If the economy, housing values, and stock market are strong, why do consumer debt levels continue to rise? I think there are two reasons. First, upbeat consumer confidence often leads to higher spending and a greater comfort level with taking on debt. Second, as we all make more purchases online and through mobile applications, it is harder to track overall spending. If not monitored closely, spending…

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