Fix Your Finances – Page 8

What Is a Zero Based Budget & Why You Need One

Published on June 10, 2014October 16, 2016 by Danielle YB Vason5 Comments

The Zero-Based Budget

A Zero-Based Budget or “zero balance budget” forces you to justify each expense by assigning a dollar amount to every move you make with your money. That is to say, your income minus your expenses, equals zero. Radio host and financial advisor Dave Ramsey explains, “If you cover all of your expenses during the month and you have $500 left over, you aren’t done with the budget yet”. Although Ramsey speaks of the zero based budget in terms of monthly spending, I prefer to budget twice a month since I have irregular income. You know exactly where your money is going, it leaves no room for overspending, and it is based on your current needs, which are clear advantages to this type of budget.

519515599

I used to write down every expense to get an overview of how I spend money. It was good because I was able to see patterns in my spending that I was unaware of. Outside of being a very tedious task of tracking every expense (pre-smart phone apps), doing this sort of overview only happened AFTER I have already spent the money. Nowadays, I take a more proactive overview of my finances and I spend my income on paper BEFORE I spend a dime in reality by using a zero-based budget.

How to Make a Zero-Based Budget Work for YOU!

Sure there’s computer based software for budgeting, but I find a simple pleasure of the good ole’ pen to paper method. It’s my personal preference but in order for you to be diligent in your effort, you should choose whatever makes you most comfortable. Got your tools? Let’s go!

Read the Full Post Here: 6 Easy Ways to Make A Zero-Based Budget Work

Let’s Connect!

shemakescents{at}gmail {dot}com | Instagram @shemakescents

{Week 21 Update} 52 Week Challenge Helped Me Hit A Financial Milestone!

Published on May 24, 2014May 24, 2014 by Danielle YB Vason4 Comments

It’s week 21 of the 52 Week Challenge and I am five weeks away from the half-way point of the challenge I started on Friday, January 3, 2014. Over the course of 21 weeks, I have saved over $500.00 dollars that I would have spent on random bits and baubles. Doing this challenge, along with deciding to play a little Russian roulette with my finances, has helped me to pay off my ENTIRE credit card balance three months ahead of schedule.

While some may think a money challenge like this is not worth the effort, I strongly disagree. Not only are you putting money aside for whatever your current financial goal may be, be it paying down debt, saving for a new car or home, or planning a wedding, you are also altering your previous financial behaviors. Personal finance is 80% BEHAVIOR and only 20% HEAD KNOWLEDGE! Just taking the steps to start a challenge like this means that you are getting into the habit of saving. Becoming successful in the challenge means that it has become a part of your lifestyle and not a temporary behavior change. I urge you, if you have thought about ways to save money to try this challenge BINGO style. It’s the easiest way to save extra money under your own terms.

Email me for a copy of my 52 Week Challenge Sheet & Start the Challenge TODAY!

Let’s Connect!

FACEBOOK, TWITTER, PINTEREST, RSS Feed,

Email SMC: shemakescents@gmail.com

{Health & Finances} What is the difference between a Co-pay and Coinsurance?

Published on May 13, 2014May 12, 2014 by Danielle YB VasonLeave a comment

I will admit that the topic of “health insurance” is NOT SEXY; however, when that moment comes where you are sick or injured, knowing that you will not have to come 100% out of pocket does sound attractive. Between the deadline of the Healthcare Reform Act this past March and the realization that I was no longer on my parent’s insurance, hit the reality that it is not only my financial responsibility, but also my duty to myself to figure out what it all means for my health and finances. I found myself getting frustrated during the process of picking a plan that is right for me because I was not familiar with the terminology that everyone else seemed to throw around so freely. Since my mother works in healthcare, she always took the lead in handling my medical and insurance matters for me…leaving me stressed and clueless when it came time for me to do it for myself. I wanted to know how to read my bill and what to budget for doctor’s visits. I figure, it starts by speaking the lingo.
Photo Credit: Stockphoto4u/istock.

Copayment
If you have a managed-care health insurance plan, your copayment “copay” is the fixed amount you pay for each in-network doctor’s office visit or approved medical treatment. In some plans, the copayment to see a specialist to whom you’re referred is higher than the copayment to visit your primary care physician. If you see an out-of-network provider, you are likely to be responsible for a percentage of the approved charge, called coinsurance, plus any amount above the approved charge.

Coinsurance
When your healthcare insurance has a coinsurance provision, you and your insurer divide the responsibility for paying doctor and hospital bills by splitting the costs on a percentage basis. With an 80/20 coinsurance split, for example, your insurer would pay 80%, or $80 of a $100 medical bill, and you would pay 20%, or $20. Some policies set a cap on your out-of-pocket expenses, so that the insurance company covers 95% to 100% of the cost once you have paid the specified amount.

{source: Yahoo Finance}

The Take-Away
Unfortunately, there are no one-size-fit all insurance plans for the masses. When deciding on a plan you must take into account how you regularly you see the doctor and how much you can afford should something unfortunate happen. If you see the doctor regularly, it may be beneficial to find a lower co-pay plan. The good thing is you no longer have to budget things like birth control, preventative tests, or physicals into your budget.

Let’s Connect!

FACEBOOK, TWITTER, PINTEREST, RSS Feed,

Email SMC: shemakescents@gmail.com

{Style Cents} The Most Stylish Way to Destroy A Credit Card

Published on May 13, 2014May 12, 2014 by Danielle YB Vason2 Comments

{Photo Source: Clossette}

I saw this picture not too long ago from the blogger and self-proclaimed JeDIY master, Yuka Yoneda, of Clossette.com and my mind started to race. That’s right, you are looking at a fabulously easy DIY name necklace repurposed from her old Macy’s card. People cut up credit cards all the time to celebrate a BIG pay off, to keep themselves from going into further credit card debt, or because they were issued a new card. No matter the reason, this is definitely a more stylish option than going all Edward Scissor Hands on your old card. I still can’t fathom the thought of doing the “big chop” on my credit card once it hits a zero balance. It’s hard to shift that paradigm of having a credit card simply “in case of emergencies” but I am starting realize that is what my emergency fund is for. I’m not sure if I am ready to cut my current card, but I have a card or two that had to be replaced because of a corporate breach. If you are taking part in this DIY, remember to first demagnetize the card, shred the card after you have removed your “name plate”, and dispose on trash day.

Chic or Cheap?

FACEBOOK, TWITTER, PINTEREST, RSS Feed,

Email SMC: shemakescents@gmail.com

Are You Guilty of this Common Credit Score Blunder?

Published on May 1, 2014April 30, 2014 by Danielle YB VasonLeave a comment

Using this type of payment was once thought to be a great way establish and build credit. Some people may agree that this is still the case for in-store financing. I’m inclined to disagree. Fact: Good credit is important to secure financing when making large purchases such as furniture.

But did you know that financing furniture or other high ticket items can have a negative impact on your credit score?

When shopping, sales people will make payment suggestions to the consumer to close their deal. The first offer that is usually thrown out is a store card or in-store financing. They will present both options making them sound attractive with facts that have no real financial bearing, like 5% off when you open a card today. In most cases, in-store financing is affiliated with well-known banks which may make you as a consumer feel more comfortable. Yet the deal is generally closed once consumers hear the magic words- “no money down and no interest for two years.” to find out why it’s not a great deal!

What are you saving for?

FACEBOOK, TWITTER, PINTEREST, RSS Feed,

Email SMC: shemakescents@gmail.com

{Week 17 Update} Why This Easy Financial Move is Worth the Risk

Published on April 28, 2014 by Danielle YB Vason1 Comment

It’s funny how children’s fables are still relevant to adults and the decisions we make. Are you familiar with the story about the Grasshopper and the Ant? It’s the one that provides an oral lesson about the virtues of hard work and planning for the future. The fable is about a grasshopper that has spent the warm months singing and dancing while the ant worked to store up food for colder months. When winter arrives, the grasshopper finds itself dying of hunger and begs the ant for food. His lesson– it is best to prepare for the days of necessity.

Last week was week 17 of my 52 Week Money Challenge and I am excited to announce that I am under the $1,000.00 mark for my credit card balance. This week I crossed off $51.00 on the SMC Bingo Money Sheet, which puts me at a total of $421.00 dollars in extra payments applied to my credit card balance this year. When I first made this goal a part of my financial plan, I thought that paying off this debt would take longer. It’s not a glamorous or goal trendy. Most of my friends don’t even understand why I am making these type of financial goals for myself, but I can’t think of many things more delightful than not having to worry about massive debt.

Hare Brain Behavior

In the post, Is This Super Easy Financial Move worth the Risk?, I threw out the idea of going against Dave Ramsey’s advice to maintain a $1000.00 emergency fund. I revealed that I was considering tapping into my emergency fund once I got my credit card balance under the $1000.00 mark. Well that moment is here and I have decided. I considered every suggestion that readers posted in the comment section of that post and on our Facebook page and I have decided to use $500.00, half of my emergency fund, to knock down my balance even faster. Not only would that put me ahead of my goal date, but I would also end up with more money back in my emergency fund AND savings because I would not be paying interest fees. That’s to say that once my emergency fund is back up to the recommended $1000.00 mark, I would continue put any extra money (up until the original goal date of August 1st) into my savings.

Slow & Steady Wins the Race
Although, I have decided that tapping into the emergency fund is the best move for me. I would only do so under one condition – the results of the check engine diagnostic on my C-class Mercedes. If I can afford to pay for repairs to my car and knock out my credit card debt faster, without going into the emergency fund, then that’s what I will do. Otherwise, I would risk using credit again to take care of this unexpected expense, which is a point that many of you readers brought up when I first presented this idea, and defeats the purpose of having an emergency fund in the first place.

Does slow and steady win the race every time? I’m not sure about EVERY TIME, but I do know that it has become a well-known lesson for a reason. I’m just hoping that this time, I’m an exception to the rule. Only time will tell and I can’t wait to let you know how things turned out. Like the ant, I am preparing for days of necessity through working hard and planning for the future. Why not make my money work for me?

Do you consider yourself a financial grasshopper or ant?

FACEBOOK, TWITTER, PINTEREST, RSS Feed,

Email SMC: shemakescents@gmail.com

{SMC Announcement} Danielle Boler for FeeX

Published on April 22, 2014April 21, 2014 by Danielle YB VasonLeave a comment

Just recently I teamed up with a company called FeeX to join the conversation of about money for their company blog. The content is a mix of personal stories, financial insights, news, and interviews and I am honored to be a part of the discussion. FeeX is a free service that uncovers the hidden fees in your retirement accounts—initially IRAs—and estimates the damage that these fees are inflicting on your retirement savings. Are you one of the 7 out of 10 Americans that are completely unaware of the fees eating away at your retirement savings? I think this type of service is cool and a great way to learn more about retirement savings while adding my twenty-something voice to their blog. Check me out!

Let’s Connect!

FACEBOOK, TWITTER, PINTEREST, RSS Feed,

Email SMC: shemakescents@gmail.com

{SMC Journal} Why Youth Could Be Your Best Financial Strategy

Published on April 17, 2014May 19, 2014 by Danielle YB Vason5 Comments

I was talking the other day with a friend who just found a twenty-year-old document from a forgotten 401(k) plan. When he was twenty, he worked at what he called a “simple little job” and enrolled in a 401(k) plan. He didn’t max out his employer’s matching and contributed a modest amount putting aside what he could on his limited budget. He moved on to another job, his career blossomed, and somewhere along the way, he forgot about his 401(k) plan from his first real job. Imagine how surprised he was to find out that his forgotten money has compounded to over $25,000.

His story got me thinking about my finances, especially the poor financial decisions I made in my early twenties that I am still paying for. Interestingly enough, one of my biggest regrets has been not contributing to my 401(k) when I got my first real job at 19 years old. At the time, I was working for a company that offered dollar-for-dollar matching. I am still kicking myself for leaving FREE money on the table by not taking advantage of my youth and the company’s benefits.

It is one of those lessons I had to learn the hard way and my current financial portfolio is proof. I am embarrassed to admit the reason I didn’t enroll in a 401(k) then was because I was trying to save money for my sorority fees and dance team expenses. I was living and planning for the “right now” and not thinking about retirement or saving for a future nest egg. I thought to myself, I have plenty of time to do this, but little did I realize how quickly time flies. Almost ten years later, I still wish someone had thoroughly explained to me that having youth and time on my side was one of the best methods to help build wealth and save for retirement. I look around and see so many people working way past their prime or even living in poverty because they do not have savings to fall back on. If I could go back in time and have one conversation with my younger self, I would tell her to spend cash not credit, pre-pay her student loans since there is now plenty for that, and enroll in a 401(k) program as soon as possible. If I had made those decisions then, I would be closer to my goal of living a debt-free life now!

This post was first published on the FeeX blog.

What’s most important to you?

Living in the Present or Saving for the Future

FACEBOOK, TWITTER, PINTEREST, RSS Feed,

Email SMC: shemakescents@gmail.com

{Donating to My Alma Mater} Why I Give Even When I’m Saving

Published on April 11, 2014April 10, 2014 by Danielle YB VasonLeave a comment

One reason that I have over $20,000 in student loans is because I chose to attend Spelman College, one of the nation’s top liberal arts colleges and #1 ranked HBCU. I was offered full music and academic scholarships during my senior year of high school to other colleges and turned them down to attend a school Forbes ranks among the nation’s top ten best women’s colleges. I got a little “something something” based on my academic achievements, but when everyone beside you is a Valedictorian and Salutatorian of their high school class, just being in the top 5% isn’t really scholarship worthy. While I know my parents supported whatever decision I made, I am sure on some level my Dad’s wallet would have been very okay with a FREE education, elsewhere.

Why I ♥ Spelman

Making the choice about where I would attend school was the first major decision that I ever made for myself. It marked the transition from childhood to adulthood and helped shape the course of not only my career, but also my life. In the end, I did not even consider the price of tuition (estimated $120,000) because I knew without a doubt, that Spelman was the right place for me. From the moment I walked onto the campus, so many beautiful, intelligent, and diverse women from around the world welcomed me. For the first time, I was “at home” in an academic space where standards and honor are raised.

Why I Give Even When I’m Saving

Earlier in my matriculation, I noticed the presence and pride of the alumnae. I was told that I was standing on the shoulders of greatness, hard work, and those who came before me. Now is my time to help provide opportunities that help prepare the next generation of women who will change the world. Dr. Beverly Daniel Tatum acknowledges in the 2012-2013 Report of Philanthropy that “a college education is a privilege.” According to Tatum, “We live in challenging times when educated women are needed more than ever. The generosity of alumnae, corporations, faculty, friends, foundations, parents, staff, and our current students has secured vital financial support to develop these change agents. [Spelman] appreciates your contributions to scholarships, facility, renovations, innovative initiates such as Wellness Revolution, faculty and student research, and support of Spelman’s Annual Fund- all of which are critical for Spelman women to succeed.” Yes, I have financial goals and a financial plan; but there is nothing like going back and seeing the women who are now standing on my shoulders and in need of support. Giving back doesn’t always have to be in the form of financial contribution, however, I do highly recommend it. Every year, Spelman announces a goal for it’s Every Woman Every Year campaign. This year’s goal, like the year before, is to surpass 50% alumnae participation or 8,667 alumnae donors by April 11, 2014, the 133rd Anniversary of Spelman’s founding. I make my contribution every year on this date and charge every Spelman alumna to show the impact of her voice, by making a contribution to Spelman in honor of our founding. If you don’t give back to your school, I encourage you to do so. If we don’t invest in where we came from, how can we expect anyone else to?

Happy Founder’s Day Spelman College

FACEBOOK, TWITTER, PINTEREST, RSS Feed,

Email SMC: shemakescents@gmail.com

{Debt Management} Is This Super Easy Financial Move Worth The Risk?

Published on April 7, 2014January 11, 2015 by Danielle YB Vason17 Comments

You Get Out of Debt The Same Way You Learned How to Walk- One Step At A Time

Dave Ramsey

I am from the generation of instant results. Sometimes this can be a bad thing, but in this case, I think my generational behavior will pay off. I am working toward my next financial goal of having a zero balance on my credit card by August 1, 2014. Once I reach my goal, I plan to only use the card for things that can be paid off before the end of the billing cycle (if I must use the card at all). Last year, my balance reached over $5300.00 and my monthly bill was putting a wrench in my spending/savings plan. That was my “aha moment”. It was then that I decided to take full control over my financial situation by not only setting goals, but dates to meet the goals. Financial coach and author, Dave Ramsey, believes that you get out of debt the same way you learned to walk—one step at a time. For this idea, Ramsey created 7 Baby Steps to help people beat debt and build wealth. The first Baby Step is to start an Emergency Fund of $1000.00. Once you’ve completed Baby Step One, you then move on to Baby Step Two where you start to pay off debt using the Snowball Method. I’m at Step Two and I am trying to pay off my credit card and then move on to my student loan debts as fast as possible. This led me to a thought one day to do something extremely risky….

Playing Russian Roulette With My Finances

In my Week 14 update of my money challenge, I relieved for the first time just how I have gone from balance of $5300.00 to a $1345.00. The closer I get to the $1000.00 mark the more crazy ideas flow through my head.

For instance, I came up with the idea, a while ago, to go against Ramsey’s advice and completely deplete my emergency fund. I would do this only when I got my credit card balance under the $1000.00 mark. The Pro to that idea is that I will immediately have a ZERO balance by using the Emergency Fund to pay off the remaining balance. The CON… well we call it an “emergency” for a reason. It is a somewhat good idea if I had a crystal ball and a glimpse that there would be no financial emergencies soon. No one can foresee when you really need to tap into that fund. Plus, not having the funds at all will send you right back into debt because you will have to cover the “emergency” with credit or even worse, borrowing from someone else.

Keeping my original idea in my, I considered a tapered down version of my risky plan. Instead of depleting the Emergency Fund completely, I would take out $500.00 and apply it to my credit card balance once I got under the $1000.00 mark. Doing so will help me to reach the zero balance goal, two months ahead of time and stay on track with my financial plan. Once the credit card balance is paid in full, I would then continue my normal $300.00 per month + money from the 52 Week Money Challenge to replenish the Emergency Fund until August 1st. Because I have eliminated interest, I would actually end up with $100.00 extra going back into my Emergency Fund.

If You Were Me, What Would You Do?

FACEBOOK, TWITTER, PINTEREST, RSS Feed,

Email SMC: shemakescents@gmail.com

~ Update: Click here to see what Danielle decided to do ~