Archive for the ‘Saving’ Category

Credit Card – Things you should know

December 2nd, 2008 Vijaianand

Last week was a busy week at my work as I was working extra hours to get things done. Obviously, work takes priority as pays the bills. For that reason, I had to miss my last week post.



Before that, I posted a blog about CITIBANK which was needed to shed some light on the issue. Let me switch gears to get back to my favorite which is left over topic, IDENTIFY THEFT&CREDIT CARDS. I talked about why credit is preferred by many people and talked about self searching yourself to see whether you need one or not. This post I am going to cover some things on how to get a credit card taking different individuals role from different walks of life.



Getting your first Credit Card



First of all, once you decid to get a card after finding its ease of use and to avoid the burden of carrying cash all around. To tell you frankly, it is not that easy to get one these days. It was easy a year ago but not now as companies are going back to basics looking out for credit history to offer a card. You would have to have good credit history to get a credit card with good limits. But Credit history only gets built once you start borrowing and paying back your debts from the lender whether its credit card company and bank. Its Catch 22!!



Normally, you are eligible to carry a credit card after 18 years. So College students are very attractive customers for the credit card companies.


If you are a student, you are sure to be haunted by credit card companies as they are so willing to offer your student loans. That’s one way to start out credit history and many people do that way. Many kids have good bank history even before they start their college because of their well planned parents who open accounts and educated their kids on money and saving ideas. I strongly recommend parents to educate their kids early and give a kick start to their financial life.



Let say you didn’t go to college and your parents didn’t help you out, then it gets tough. You have to start it all out from scratch. Luckily you found a job and earning reasonable income. You can open a bank account and get your earning flow through the bank. This way you would have accomplished a good bank history. Once you have the bank history, you can apply for a credit card with low credit limit as many banks offer these days and start building your credit history.



Another section of consumer are the Immigrants(like me when I came first) who are here to work and your situation is similar to the above. They don’t have any history of any type as they don’t even have SSN. They have to start it all out and it is tough so most of the time they dependent on their company offerings until they accomplish some history.



Without credit history, it makes living in America a tough ordeal. I been there and learnt lot of lessons. You cannot buy a car, you cannot get a good place to live and list goes endless. You end up depending on their big brothers/co workers who came before them for everything. Once they good bank history, try banks low credit limit cards many banks offer binding to your savings/checking account. You can start with those credit cards to get your history and slowly you will get into to good books of credit card companies.

Once you got into the good books of credit card companies with good credit history and credit score, then you will start getting offers at your door steps and they won’t stop until you die.


Things to know in advance


1. If you have a good credit history, attractive offers will sure to show up for you even in bad times like this one. Credit card companies/banks need borrowers to borrow money so they can do business and make money in interests. But be wary of their offers. Its not all the same.


Every credit card is different and they have similar rules but different mechanism to attract you to getting the card. So read the offer carefuly before signing up.

2. I strongly recommend you to check whether your credit card issuing bank offer Fraud Alerts for free or might be able to sign for little cost. This alert system come in handy to give signals when peculiar activity happens in your card that may be a hacker who got your card number or thief stole your card.

3. Check all the fine prints like fees or charges on withdrawals, Interest rates for Balance Transfer/Purchases, fees on Balance transfers. Some card offers 0% interest on purchases which is not the same as Balance transfers to your card. Both are entirely different. Also check whether they have transaction fees for Balance transfers. Many credit card companies charge 3% – $10 min fees but very rarely you get free balance transfer fee offers.

4. Check on their billing period and when do they start so you can plan on paying back the money borrowed. Also try to check on their grace period which is either 20 or 25 days depending on their bank offering the card.

5. Finally, just make sure the offers are right when you apply for your card over the phone which is better than applying over mail. That way you can confirm the offers sent to you and you can always use that conversation in future when things go wrong.

I covered some basic as well as important points on how to get a credit card and how to start your credit history according to my experience. I will cover some more facts and pointers in my next post on what are the ways your card or card number can be stolen so you can watch out and what you can do when it happens.

Posted in Credit card, Saving Tags: , No Comments »
Read More »

Are you Money Smart$$$?

September 22nd, 2008 Vijaianand

“Money Smart” – I recently came across this catchy phrase when I was checking about Houston Money Week 2008. It is a week long event put together by Federal Reserve partnered with few financial instituations in and around houston to create financial literacy. It has be cancelled because of Hurricane IKE. Lets get back on the talk about “Money Smartness”. This phrase really intrigued me because it tells the core concepts of my money really matters mantra. I even incorporated it in my slogan as “Get Money Smart, The Right way!!”


Are you Money Smart?


Let’s take a quick moment and ask some questions to ourselves and figure out.
Are you the one,
clipping coupons for every grocery item you can find in any grocery store ad?

always try to be the first in line for any door busters sale beating the crowd?

who signs up for every freebie coupons and free raffles?

who checks the internet to find the cheapest gas station nearby?


The list just goes on and on. I don’t see anything wrong in saving money in whatever way possible. I agree with phrase, “A Dollar saved is Two earned”(Check out mymoney blog for the proof). But, only these activities won’t make one a Money Smart person. It is just one part of the Pie. There are few other important portions of the Pie which is as important as Spending.


What is Money Smart?



Money Smartness$$ is about “Making extra, Spending wisely, Saving graciously and Managing rightly”


Let me dwell into it more deeply and share my perspective on each of them.

Make extra – We all know, everybody needs money for survival and we all work towards earning that very money. You ask me, we are already earning it with whatever time we have. What do you mean Make extra? How can I make extra if I can only spend certain hours a day? Answer is, Yes You can make money in lot of other easy ways even while you are working. You are earning to pay bills using your hard learned educational knowledge. You can turn your passion or hobbies as a money making machine.


Spend wisely – We all got to spend money to live our life. We need a place to live, food to eat, clothes to dress decently, go places, do charity and list adds up as our need grows. It upto to us to sort out and prioritize which need is more essential and channel our spending to the right important ones. For example, if you really need a car to commute, instead of taking a cruise or vacation you better spend that money to buy a decent car. Spending for the right need at right the time with right price is totally wise thing to do.
 

Save graciously – Savings is like antibodies for a healthy family. If you store up health antibodies, it will help you make your body immune to bad disease. Simiarly, without any type of savings your family will sure to struggle when there is a urgent or emergency need for money. So Putting away money on periodic basis will help you save lot of frustration and save you from falling in debt. You don’t have to open a bank account to do it. You can even use your child piggy bank to start throwing away your pennies and dimies every day which will eventually grow in tens of dollars.


Manage rightly – You make the money and you should be in control of it. You shouldn’t let others make decision for you. You take their advise but you manage the way you want your money to be managed. They are not going to be living with the loss or gain. It is you and you only who is going to take the hit or miss. So Manage Money in the right way by investing in right place with proper education and guidance.

How can you become Money smart?

Getting Money smart is not just about following some tricks and tips. It is about changing your thought process and taking necessary actions which will eventually make a difference in your life style. In order for that happen, you need to start out slowly and make the change. Fast is in’t always good, Slow and steady sustains longer helping you to win your financial goals.



1. Change your attitude slowly towards Money and start thinking towards Making extra, Spending wisely, Saving graciously and Managing Righthly.


2. Try to check out things on the arena of good money managment tips and techniques from various resources like internet, expert advice and more.


3. Reguarly read books and magazines on smart money strategies, savings ideas and get updated on new financial changes. I have recommended few books which I think are real good to start out.


4. Attend free seminar or workshops arranged by resources like libraries, banks and financial institutions. Filter the marketing information, only take what you really need.


5. Implement the ideas and strategies in you real life slowly by changing your current habits and taking actions.


6. Start teaching your kids once they are at age about money and cultivate the habit of saving.



Happy reading on getting Money Smart!!!


Posted in Financial Literacy, money really matters, Saving Tags: , , No Comments »
Read More »

Life Saver Emergency Funds

August 24th, 2008 Vijaianand

Last week, I got hit by sudden financial storm which put me a on state not allowing to concentrate on posting the blog. Now, I am back safely without any credit injuries, I really like to share my story about the Life saver incident. I am sure many of you experienced or experience this sudden financial crisis which hit us without any notice. I know it is not an easy task either to escape or get out safe and sound if you aren’t plan and prepared for it.


Delay in my Contractor job payment delay, my truck is about to breakdown and needed immediate fix and a must to do medical procedure for my son all of them hit me hard at the same time. I got in the midst of the storm and there is no escape other than take the hit but protect myself. I wouldn’t have taken that chance, if I didn’t have my saved store emergency funds.



It was like wearing a life jacket in a flood water which is rushing fast and won’t last long. Life jackets are safe and it will help to float and be on top of water without getting drowned. Emergency funds are life jacket/lifesavers to our financial life. I know I am using bit too much analogies today but I like it put this in a way so it makes real sense and shows the importance of the topic.


Alright, What is an Emergency Fund?


As I was saying, I like to call it as a lifesaver fund. Life obviously will have unexpected happenings. There are plenty of situations like I mentioned which will hit us without any prior notice. You don’t have any choice to take on the expenses. You can try your best to postpone those expenses but some medical and emergency situations can’t be postponed. In those tough times, you really need to have some funds available to depend on to take care of it. These funds are emergency funds.


Why do you need it?


Life hits us hard at times and nobody knows when and how. It is better to take the precaution and be prepared. Instead of waiting for it happen and figure out at the time. So it is always good to save up some money for those emergency situations. I know lot of people are struggling to even meet their ends at the tough economy crisis and it might be tough to save for any funds.

If you are one of them, I would recommend to consider at least put away your tax refunds or any bonus payments as emergency funds. It will surely help you. Instead of depending on the plastic money(credit cards) and racking up the balance in that account which will hunt you down later. It is good thing to have a store of money to help you.



What are types of emergency fund?


It depends each individual. I have 2 types of emergency fund setup right now. Medical and Emergency funds in a savings account. I also have 3 more savings account just for the purpose to handle any Short term, Home and other unexpected expenses. I put away $100 a month on the 2 accounts and at least $50 on these 3 accounts. It eventually adds up and at year end I just put them in a CD which I can take out anytime with or without penalty. Also if my credit card gets hit by these sudden expenses, I just draw the amount according to the expense from these accounts and pay it off.



How much do I need as Emergency fund?


That’s a tough questions since it also depends on each individual. Many experts recommend at least 3-6 months of your monthly expenses. That might be a bigger amount to target for starters. So I would recommend at least start putting something away like $25, $50 or $100 every month and set a goal to reach around $1000 in a year or so and move up the limit if you haven’t used up your savings.


Just put your money in a savings account that way at least you have some interest for the amount every month and helps your money grow. It also helps to access the fund easy and faster.




Emergency fund is such an important aspect for a financial life avoiding stress and frustration which don’t really need at the time of emergency situations. So start thinking about it and save up for the hard times. You will surely appreciate my post when it happens.

Posted in Banks, Financial Planning, Saving Tags: , , No Comments »
Read More »
« Older Entries
Newer Entries »