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admin — Thu, 02 Feb 2012 18:38:06 +0000

Creating a Budget for 2009 - Step One

Finance Guy — Wed, 31 Dec 2008 05:21:00 +0000

2009 is almost here - are you ready? As you may have read, Bookworm had a hard time following her 2008 budget and asked me how she can redo her budget to help her in this new economy.

You’ve all heard the news - the economy sucks, the job market sucks, businesses are paying their people less money for more work and everyone is supposed to take it because there are no new jobs.

That’s fine - besides going to your boss, you can’t change that. But you can change how it affects your short and long term financial goals. So get a pen and paper ready… it’s time for Step One in budgeting basics for 2009!

Step One: Gather up all your monthly expenses… FOR THE LAST SIX MONTHS.

You NEED to have the last six month’s of expenses in hand before you even start your budget. How can you put together a realistic budget if you don’t know what you’ve been spending?

Six months is a good baseline for your spending. It hits at least one major holiday, two seasons, etc. If you include Christmas into the budget numbers you will always have a little bit left over at the end of every month.

It’s the first step - and it’s daunting. I know that. But you are setting yourself up for a great financial year if you know what to expect.

So go and find all of your expenses for the last six months. Organize them into their categories and line items… so you can have “House” or “Apartment” as your first category and “Water” or “Electric” as one of your line items.
Come back again tomorrow morning and I will have Step Two in my series of Creating a Budget for 2009 AND a very handy budgeting worksheet in Excel ready for you.

New Year - New Budget

Bookworm — Wed, 31 Dec 2008 05:03:59 +0000

Well, we’re almost at the new year, and with this new year, I know I need to revamp my budget.

Have you taken a GOOD look at yours lately?

Personally, I’m dreading the thought of REALLY looking at my budget. I know I spent a lot more than I should have this year. Add the upgraded lifestyle and more bills - that’s already a recipe for disaster. Mix in a depressed economy and bad job marketing… well, I work with the “Financial Guru” here and I’ve already made all the mistakes he warns everyone about.

I didn’t look at my budget closely enough with all the good things going on in my life… buying a house, getting married, etc. - life happened and my budget went out the window. Now, life happens. Rather than letting that get to me, I’ve decided to work closely with Finance Guy on my budget… and keep everyone in the loop on all my setbacks - and all my accomplishments.

Finance Guy will be adding his quick and easy step-by-step budgeting guide through Friday to help you start on the right financial path BEFORE the first official week of the New Year starts!

I’m Buying a House!

Bookworm — Wed, 06 Jun 2007 15:24:59 +0000

Posts have been been slow lately… or really, non-existent. What have I been up to?

Well, I’M BUYING A HOUSE! That’s my biggest news. Other than that, it’s just been work at NextStudent, various weddings, visiting family, and normal stuff like that.

The house obviously is the exciting news - I’ve been working with Finance Guy to make sure I can afford it and everything is in order.

Help, I need money to live now!

Finance Guy — Tue, 01 May 2007 17:33:41 +0000

Hello!

And welcome back… I’ve been neglecting my blog and have been getting quite a few questions in.

My latest question comes from a friend who recently graduated – and doesn’t know what to do with her student loans, she can’t afford to make the monthly payments (she took out WAY too much money, not considering what would happen once she graduated).

If you are in this situation, my best suggestion is student loan consolidation. I had a friend (bookworm’s boyfriend) who had taken a lot out in student loans. He graduated from law school last May but now is over $80,000 in debt – and didn’t know how to make those payments.

All together, the companies were asking for a monthly payment over $600 – and he still needed to pass the BAR before he could practice law. He did and got a job in January, but it still doesn’t pay enough to make close to $600 per month in student loan payments, a car payment, rent, and other normal living expenses.

My biggest tip for him (as it is for my other friend) was student loan consolidation. This can help you save quite a bit in monthly payments – he saved about $200 per month once he consolidated. Now this does lengthen the time period you have to pay back the loan (from 10 years to 25) but you can actually afford to make your student loan payments. And, in all reality, you shouldn’t be waiting the full length of time to pay back your loans. You will be paying more total – if you take the full 25 years to pay back the loan. But you can have substantial savings if you earn the interest rate discounts and take advantage of the fact that there are NO prepayment penalties.

Now, this is really geared towards federal student loan consolidation. After you consolidate your federal student loans, you may be able to pay more towards any private student loans you have – which will accrue a lot more interest than your federal loans. Be sure to put any extra money you have towards these first – you can save a bundle in the long run!

Also, student loan consolidation may help improve your credit rating - most loan officers will suggest that you consolidate your student loans before you apply for a mortgage.

Now, if you haven’t noticed – I’m strongly suggesting you use NextStudent to consolidate your student loans. I know they are a good company that really wants to help students.

10 Steps to More Money in Your Pocket

Finance Guy — Tue, 27 Feb 2007 04:36:20 +0000

I have had a few responses, mostly through email, to my post, 6 Tips to Find Money for College.

This comment addresses all the responses well:

G says: I really need some advice on budgeting. Whenever I get money, after I pay bills I just want to splurge. How do you keep yourself in check? You talked about the cash method, but I was thinking about that and how much to allot to the miscellaneous and splurge expense fund– do you keep money in an envelope for possible emergencies as well? I don’t know if I could make myself do something like that, but I want to and need to start saving money!

I’ll use Bookworm as an example. I put her on a budget about a year ago. She has a few things we know she likes to splurge on (such as a yearly used book fair and Christmas) so we included that into her budget. Because of how we have it set up, she has plenty of money to cover even a small monthly splurge.

I suggest you check out this budgeting worksheet I created. The tax percentages are all for ARIZONA, since that is where I live. Use estimates if you don’t know exactly what your cost is but ALWAYS round up. If you get paid every 2 weeks rather than 2 times per month, there is a slight discrepancy. I currently have it set so it takes your salary and divides it into the 12 months, not calculated for the extra two paychecks. All you need to do is SAVE those two paychecks. If you are interested in using it and live in another state, please comment and I’ll look up those restrictions as well. I am working on creating this into a program, but that hasn’t happened yet.

Your Steps:

Define your goals.

What are you saving for? (Ex: a house, school)
How much will you need?
When will you need it?

Enter in your salary
Enter in all your known expenses.

Be sure to include money for fun stuff, a small splurge, eating out or going to a movie. You should budget for at least 2 fun things a month, I suggest budgeting for at least 1 a week. In case you’re worried, taking yourself to a movie costs only about $10, eating out can cost anywhere from $5 - $50.
Also make sure you include money for emergencies – such as an accident or medical bills that come up immediately.

See how much you have left in your monthly budget

From there, you have quite a few options. You can:

Save all the extra money so you can meet your goals quickly.
Use a little extra for your “fun money” – allow yourself to splurge a little more and save the remainder.
Spend all the extra money and don’t save. (I don’t recommend this.)

If you are saving to reach a certain goal, we’ll use getting a graduate degree, you need to figure out how much you’ll need and when you’ll need it. If it will cost you $60,000 to go back to school and you want to go back in two years, you will need to save $2,500 per month. Things you can do to get this much:

You can take away “splurge money” and anything you don’t need to spend money on (I suggest making sure you save at least some money to have fun)
You can also start investing in CDs, the stock market, etc. in order to have your money grow at a faster rate. What you can earn on the money you have already saved is not included. This will help you reach your goal faster, but there are always risks. Be sure to ask for all the risks associated with this.
Take a second job OR make concessions – can you spend less (cut out the daily cup of Starbucks), get a loan, or put it off a little longer?

Skydiving Adventure

admin — Mon, 26 Feb 2007 23:27:30 +0000

So, a few of us in the web marketing department at NextStudent decided to go Skydiving (see previous post).We went this past Saturday at Skydive Marana and had a BLAST. It took 11 of us (friends included) about 4 hours to go. Over half of us got videos (including me). Jon put his up already; take a look to get a feeling for the full experience.

Did you see that plane? I almost didn’t go after seeing it – but dude, there’s a reason why it’s an adventure. I can’t explain the rush you get from jumping out of a plane. I never equated skydiving with jumping out of a plane, but there you go. Not sure if I’ll ever go again, but it was definitely worth it.

If you didn’t figure it out, everyone is fine…although Jeff did crash hard. See the video.

You can also take a look at the pictures Justin took here: http://www.flickr.com/photos/33254583@N00.

Skydiving…TOMORROW!

admin — Fri, 23 Feb 2007 17:20:06 +0000

Guess what? I’m going skydiving tomorrow. I’m excited (and very nervous). It should be a lot of fun – otherwise, it really wasn’t worth the money. I’m going with a bunch of co-workers (in case you didn’t know, I work in the marketing department at NextStudent, a student financing company. There are about 11 in the group, 5 from NextStudent).

And for all of you who are afraid I might die – read this article! I also watched this video, but couldn’t finish since it freaked me out too much.

Juvenile Rehabilitation…Does it work?

Bookworm — Mon, 19 Feb 2007 05:13:28 +0000

I had a very good friend growing up – and then he started to get into trouble. He ended up bringing a gun to school and very soon after “disappeared.” A few years later, after my first year of college, I came home to visit my parents. I ran into him while walking Gracie (our family dog) and we started talking. It turns out he had been in so much trouble he was now out on probation – with an ankle bracelet – at that point I realized how far down the wrong path he went.It started out with him doing little things – tagging walls in the neighborhood, smoking pot, etc. It steadily progressed into theft, major drugs, and gang-related activities. The last time I heard from him was when he tried to use me as a hide-out after threatening to kill his parents with a knife in hand. I stopped all communication with him at that point. From what I hear, he is still getting into trouble.

He started on this path when he was just 13 – and went through all levels of the juvenile program, until he ended up being tried as an adult because he committed one to many crimes and got into very big trouble.

According to the Arizona Department of Juvenile Corrections, about 74,000 kids enter the juvenile system each year (in the state of Arizona). A child’s sheet starts when they turn 8 – and yes, this does happen. Of the 74,000, less than 900 are sent to ADJC – those who have not changed their ways/behavior after repeated convictions.

For the most part, Arizona tries to rehabilitate their juvenile offenders – often offering sentences of mandatory counseling, residential treatment centers, and probation. More serious offenders can be sentenced to JIPS (Juvenile Intensive Probation Services) – similar to house arrest or are referred to ADJC for incarceration. My friend passed through all of these levels before he was ever tried as an adult.

Usually, the juvenile spends a short time, if any, in custody. After being convicted of a crime a juvenile is usually sentenced to counseling and probation. It takes at least 4 referrals for a court to refer them to ADJC.

Currently, the AZ juvenile program has about a 50% repeat offender rate. So – what do you think? Does rehabilitation work or does it just give an easier sentence for people who will end up committing another crime again?

6 Tips to Find Money for College

Finance Guy — Fri, 16 Feb 2007 03:39:42 +0000

I remember how hard my parents pushed me to apply for scholarships, grants and all the free money available so college wouldn’t be as huge of an expense. We fought for months over how much time I should devote towards getting money for school. Getting a job while in school isn’t for everyone and I didn’t want to work throughout my college career without much time to enjoy the experience.

Luckily, my parents pushed my performance in school hard enough so I was eligible for a full tuition waiver to all state universities and only applied for a few scholarships to cover the cost of books. I still spent an extravagant amount of money for room and board in my first year, I didn’t have a budget (who wouldn’t buy their roommates food when they didn’t have enough money) but quickly learned my lesson.

I’m now in the position of helping others in my family start the search for college funds – some are in high school and others in college – and have some tips for those looking.

Start early. If you’re in your junior or senior year in high school and know you want to go to college – start now! It help when everything gets crazy right before you’re about to start college and may allow you to go to schools you wouldn’t have considered due to cost.
Submit your FAFSA. It’s easier if you do this online. If you haven’t completed your taxes, estimate and go back after you have filed to correct the estimate (if needed). By doing this early on, you’re putting yourself in line to get the free, or cheaper, money. Do not procrastinate, this is a little time consuming but you’ll be better off.
Know what’s out there. There are a lot of ways to get money for school. A few are:

Federal Grants: free money from the government or school.
Scholarships: free money from an outside source (companies or private donors).
Subsidized Federal Stafford Loans: Loans backed by the government that don’t accrue interest until you’re out of school and have a lower overall interest rate. You don’t start paying these until you’re out of school.
Unsubsidized Federal Stafford Loans: Loans backed by the government that accrue interest while you’re in school but at a lower rate than most other loans. You don’t start paying these until you’re out of school.
Federal PLUS Loans: Parent Loans for Undergraduate Students that parents can take out to cover up to 100% of their child’s cost of school. These are not need based, so it doesn’t matter how much you make.
Graduate PLUS Loans: Similar to a PLUS loan but graduate students can take out for themselves.
Private Student Loans: Unsecured loans that are credit-based. Most students need a co-signer to be approved.

Look for scholarships. This is free money and something everyone should look for. There are scholarships for almost every category you can think of – there is even a scholarship for making your prom outfit (suit or dress) out of duck tape! Applying for scholarships is a time consuming process, but is definitely something you need to do if you are looking for money for college. Some places you should look at are:

Scholarship Search Engine – One of the largest scholarship databases with over $3.4 billion in scholarships.
Fastweb – A scholarship search with over $3 billion in scholarships.
Your school’s financial aid web site – this should offer their specific scholarships, some of which you may be eligible for.
Web sites of places you’re currently involved in. Involved at church? Have an extracurricular activity? You may be eligible for money.

Ask for help. There are lots of people who love you and would like to see you succeed – can any of these people help you with your goal? Sit down and have a heart-to-heart with those who may be able to help you. Your school advisor should also be able to help point you in the right places.
Sign up for free information. There are a lot of places to get good information on getting money for college. My current favorite is NextPath, a financial newsletter that gives information to students, parents, and recent graduates.