Category Archives: Money Matters

2020, Daily Post, Money Matters

Getting Out of Debt

STAGE 1: Year one

Getting out of debt is no small peat. You either get another job and use all the extra money to pay it off. Or evaluate why you are even in the debt situation. Try this for a year and let me know what you think.

REMEMBER YOU NEED TO DO THIS EVERY MONTH and ACCORDING TO YOUR MONTHLY EARNINGS YOU TAKE HOME OR DEPOSITED INTO YOUR ACCOUNT.

  • It is very important to stay focus. Be patient. You need 3 pieces of paper to stay focus(Stick it to your refrigerator, where you can see it or buy a notebook). Put it where you can see it.
  • PAPER 1: Pay yourself first. Set aside for later use. ($50 is my rule of thumb). Need to be taken out of your bank. Write it down and together with the money.
  • PAPER 2: Check ALL your monthly bills including miscellaneous. Write them all down.
  • PAPER 3: Set-up amount for necessary monthly bills such as electric, water, and any other NECESSARY utilities you need to run your home. No miscellaneous. Write them down on your monthly budget form.
  • Stick to your monthly groceries budget($150-$200 is my rule of thumb for every 4 people). If you out of milk or out of juice, do not buy another one instead drink water. Whatever you are out of, do not go buying it. It cost gas money to go back and forth buying anything.

NOW let’s pay our debt:

You are reading this post to get out of debt. Whatever money left after utilities and groceries. Credit card is NOT extra money you can spend. Getting out of debt means zero balance in your credit card. Loan paid off. Credit card and loan are both with interest. Everything takes time especially getting out of debt.

  • First, pay off the one with low balance. (Put all your credit card in one small plastic bag and freeze it.)
  • Second, make payment over the interest amount. If the interest is $150, you should be paying $400 or more. No more than what you can afford every month to pay. You do not use credit card or get another loan.
  • Third, use cash not debit card
  • Fourth, use debit card to pay bills including gas
  • Fifth, check your checking account often.
Daily Post, Money Matters

Living Paycheck to Paycheck

Living paycheck to paycheck is what money you get on payday and you have zero dollar in a few days after you get paid. This is a reality for most people. Where all the hard earn money go? Statistics is only good for information but it will not help. Try this monthly. See sample on the blog or create your own personal money management. Income every two weeks for a month and expenses such as rent or mortgage, groceries, water bills, electric bills, gas or whatever type of transportation to get to work, car payment, and car insurance. Write all the necessary expenses for a month. Deduct total expenses with your money income. (Write it down to see what happen to your money.)

May____ ~ May ____
(WRITE THE DATE EXAMPLE MAY 1 ~ MAY 31)

1st two week Income:
2nd two week Income:
Add both as Income Total:_____________________________
(WRITE THE TOTAL INCOME)

1. Rent/Mortgage
2. Groceries
3. Water
4. Electric
5. Gas/Transportation
6. Car Payment
7. Car Insurance
8.
9.
10.
Add everything as Total Expenses________________________________
(WRITE THE TOTAL)
Income Total – Total Expenses = $0 

(If you are getting a loan or charging anything to your credit card, you need to evaluate your spending habit. If you are using bank line of credit, you are spending bank money that you don't have to begin with. NEVER sign up for money you don't have instead do something about it.)

~Be aware if it says PENDING on your bank account that money is not cleared yet.

~As for pending deposit, you cannot spend it before it is cleared. If you start spending before it is cleared, the bank will charge your account for each company or each check a bank fee of $29.00 or more depending on your bank. 

For example, you bought gas for $10.00 and you will see on your account a $29.00 bank fee.  Now, you end up paying $ 39.00 for a $10.00 gas.  Ridiculous but it is a reality!  So, if you go to the store spend another $45.00 and you will see another $29.00 bank fee.  Take notice of all bank fee.
A – ExpensesB – Bank FeeC – Total
Gas $10.00Bank Fee $29.00$39.00
Safeway $45.00Bank Fee $29.00$74.00
Electric $200.00Bank Fee $29.00$229.00
10 Bank fee that is $290.00. You could have save or pay your credit card with.

~As for pending charge on your account or not charge yet, it is not cleared out of your account. DO NOT start spending before your pending charge or your auto pay are paid. KNOW when is the bills are due date and how much. Auto pay is another problem. Never sign up for it if you are living paycheck to paycheck. Unless you have no choice because you are traveling and you just want to get it paid.

What happen when you spend money before pending charge? You end up paying company for bounce check($30.00 or more/less) and late fees($15.00 or 10% maybe more/less). Don’t forget bank also charge bank fee($25.00 or more/less). 

For example, let's say you have a $100.00 insurance bill.  You start spending the money before paying your bills that is on the pending charge.  By the time, it was charge you do not have enough money to cover the bill.  The check bounce and it is return back to you bank.  Since, it was not paid on time. The insurance company now will charge you for bounce check and late fees.  They will even send it to collection company that charge fees as well.  Don't forget your bank will charge you too.  Hopefully you catch it before everyone just start taking out your money out of your account.  It is legal that is the sad thing.  Wait!  This is all start with your doing.
A BillB FeesC Total
Insurance Bill $100.00Late Fees
Bounce Check Fee
Collection Agency Fee

For $100.00 bill. You will be paying twice or more for one bill plus a headache. You could have save or pay your credit card with. Believe me company, collection agency and bank like it when you spend. All of them will get to charge you for more. Write C-Total the fee charge to your account. Check your bank statement. You work hard and you need to know where all your hard earned money go.