Managing Your Money Services
This article focuses on four areas of personal money management where outside forces are playing an ongoing role in managing your money: Banking, Credit Cards, Loans, and Insurance.
Banking:
If your checking account has a minimum balance requirement that you're charged a fee for falling below, then it's time to find yourself and new and better checking account to open. If your bank charges you a check-writing fee, responsible personal money management dictates you'd better start searching for a bank that doesn't charge one.
Many banks offer advantages to customers that use dDirect dDeposit for putting their paychecks in their accounts. Many banks also bestow benefits upon those customers who use their online bill paying services. If you can, find a bank with no minimum balance, no maintenance fees, and no check-writing fees that also gives one or both of these advantages.
Credit Cards:
Personal money management is a whole lot easier when you don't use credit cards to pay for anything at all. That, however, seems to be an unrealistic proposition in this day and age, when our dreams are all richer than we are. So assuming that, like most of us, you do make regular credit card purchases, the best way for managing your money spent that way is to pay off your balances in full at the end of each month.
If you're currently carrying a high balance that you just can't afford to bring down, and you haven't applied for or received any "new credit" in the past few months, try applying for a 0% card and consolidating all your high interest debt onto that one card. If you do this, though, you must be sure to follow the rules of that credit card explicitly, or wind up having your interest rate spike to an insurmountable level.
When shopping around for credit cards, remember that the companies making the credit card offers you read are all vying for your business. Just because something is written in ink, it doesn't mean it's written in stone. Ask for lenience from your current credit card company. Ask for a lower interest rate or smaller payments. Tell them you're considering other, better, offers but you'd hate to switch if they could simply accommodate. You'd be surprised how much difference you can get from a credit card company with nothing but courteous persistence.
If, on the other hand, if your requests are still refused, then do exactly as you said you would, and accept the competing offer to switch to the more advantageous credit card.
Loans:
The first personal money management tip for dealing with loans is to save up before you apply for one, and put down the maximum down- payment you can afford. The higher the down- payment, the smaller a percentage of the total cost (of the house, the car, etc.) you'll be taking out as a loan and, consequently, the lower the interest rate. Not to mention the smaller the total amount you'll owe in principal.
Secondly, set up the shortest term for repaying the loan in full that you can afford. The term of the loan goes hand in hand with the monthly payment. Using a personal finance software, like Budget Forecaster and Expense Tracker, helps you to figure out the highest monthly payment you can afford and get the loan term (10 years, 15 years, etc.) with the closest monthly payment. By paying more now, while your still in your earning years, you'll pay off the loan in full quicker, own the property or car, etc., outright, and you'll have paid less in total interest over the life of the loan.
Insurance:
As with every other arena where personal money management comes into play, when buying insurance shop around for the best deal possible. When it comes to buying insurance, however, finding the cheapest deal is not the sole factor in managing your money properly.
When you're dealing with insurance, you're dealing with issues of survival - both physical and financial. It is therefore incumbent upon you to not only find the cheapest deal on insurance that you can, but to find the one that gives you the highest level of service for your money. There may be a grey area here, where you pay slightly more than you could be paying for insurance in exchange for better care, more coverage, and greater peace of mind.
Just plug the numbers into your personal finance software and see how much insurance you can afford. Auto insurance and homeowners insurance are mandatory (if you have, respectively, a car and/or a home). Life insurance is really only necessary if you have dependents. Disability insurance, however, can make or break you. Accidents do happen, and if one was to happen to you - , one that put you out of work, whether tentatively or permanently - , you'll want to make sure you can afford to live. This is one of those cases where, sometimes, properly managing your money involves spending money.
Lastly, a couple of tips for saving money on insurance. Personal money management experts have found that if you remain with the same insurer long enough, you'll start to be rewarded with increasingly discounted premiums. You can also get discounts on insurance by using the same insurance company for more than one of your insurance policies (auto, home, disability, etc.).
Kenneth C. Kelly is the President of Strativia, a financial management software development and services company specializing in applications for personal and business use. Strativia is the developer of Budget Forecaster, a sophisticated home budget and personal finance management software package. Website: www.strativia.com. Contact: info@strativia.com.
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