{Financial Cents} Is Your Way of Thinking Making You Poor?

Just as slaves born into slavery can’t visualize freedom, we Americans don’t know what it would be like to wake up to NO debt.
Dave Ramsey, Total Money Makeover

Is Your Way of Thinking Making You Poor.pngYour alarm clock sounds, alerting you that a new day has come. You awake to find yourself owning a car without a car payment, a home without a mortgage, an education without student loans, and credit card(s) with a zero balance. How did you get to this financial freedom? Did you a) win the lottery, b) rob a bank Sugar & Spice style, or c) align your behaviors with your long-term financial goals? Well, the answer to the question depends on whom you ask.

I told a friend of mine that I was working to become debt free and she looked me right in my face and laughed. I mean laughed to the point of tears while telling me how unrealistic I was being. “Everyone has debt”, she alleged. If this were her outlook on financial freedom, I would guess that she could image a debt free life comes only as a result of a windfall. She will either rob the bank or win the lottery. I, however, understand how even the most minute  sacrifices will help me get closer to my financial goals. I have to think beyond the day-to-day and month-to-month if I want to build  generational wealth. Financial expert, Dave Ramsey adds, “We have been sold debt with such repetition […] that it’s hard for people to imagine what it would be like to have no payments”. Debt shouldn’t be the normal status quo and I am not comfortable adopting that mind-set. When the day comes when I wake up with no mortgage, no student loans, and no credit card balance, I know it will be a result of my financial plan and my commitment to it.

Is Debt Normal? Share Your Thoughts…

{Chasing the Saturdays} How I Saved $500+ Before Breakfast!

she-makes-cents-saturday-post-breakfast

I woke up in a weird mood this past Saturday. I was torn between excited to tackle my never-ending to-do list and not wanting to leave the warmth of the bed. So what did I do?- A little of both. I grabbed the laptop and started to audit my flow of income and in doing so, I noticed I was missing opportunities to save more money. Before breakfast, I saved a little under $100 a year by canceling my cell phone insurance. It was one of those things that I should have done months ago, but never really got around to doing it. The two times that I actually thought about filing an insurance claim, the deductible was so expensive that it was better to just get a new phone and not having to worry about whether I would receive a new or refurbished phone from my carrier.
My first savings of the day energized me, so much so, that I called my dad to follow-up on his savings audit I did for him last year. Even when I showed my dad how he could save $1600, he actually never followed through.  It was time for me to take matters into my own hands. I started with my parents’ home phone and internet bundle and I canceled every service that they don’t use and wouldn’t miss. I reduced their monthly bill by $40 per month equalling to about $480 a year!

Are you overpaying for services you no longer use? 

Take a little time to review your statements from your service providers.  Remove extra services that you no longer use, are outdated, or that qualify as a luxury you could live without.  I did this a few months ago when I realized my cable bill included a football package.  It made NO sense/cents for me to pay for an added luxury that I didn’t even use.  Now, I am enjoying the savings more than missing the extra channels that I didn’t event know about.  If by chance, you have already eliminated every extra fee, then you should consider calling your service provider to see if there are any other discounts that can be applied to your account.   It may take a little time to get through your audit, but remember it’s better to spend some time to save some money!She Makes Cents logo

What Services Can You Remove From Your Bill to Save?
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{Financial Cents} Say No Social and Yes to Finances!

During the infancy of She Makes Cents, I started reading Shoo…Jimmy Choo by Catey Hill. This, I admit, was another book I picked up because I like the title.  In it, Hill goes beyond the standard advice to create a spending chart and record everything you spend your money on in it. She adds the recommendation to also include additional information such as who was with you and the motivation behind your purchase. I did this for about two months and learned that I often spent extra money when I was with one particularly close friend. I usually spent money on expensive lunches and after reviewing the spending chart, my motivation behind my spending was purely emotional. I didn’t realize that was I was spending a great deal of money simply because I missed hanging out with her like I did when I was in college. Fast forward almost two years later where I started repeating the pattern of emotional and socially inspired spending. With my current job, I got back into the habit of frequently going out to lunch with the girls. I didn’t want to miss the great conversations but most importantly, I didn’t want to appear anti-social.

She Makes Cents money saving blog for women

At the start of the year, something clicked for the Mr and me. Our view on how we spend money as a couple and individually has narrowed. We have become super serious about saving and making better decisions on how we spend our money. Does that mean no lunches with the girls? Absolutely not! It does mean that I won’t be going with them EVERY DAY for lunch or drinks after work, though. Instead, I am cooking more at home and packing more lunches. As much as I hate to decline a social invitation, I would hate it more if the collective whole of my socially motivated financial decisions were the reason I wasn’t truly living a fabulous debt free life. I am proud of myself. I find that I’m eating better and cleaner. I also becoming a better cook, which is always a plus, but more importantly, I have learned to say no to social and yes to finances!

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{Financial Cents} 4 Smart Ways to Spend Your Tax Refund

tax refund

 Have you ever gotten your tax refund and thought to yourself, it’s time to go shopping? I have. Growing up, my mom would take a large part of her refund and she and I would go on a shopping spree…even if it meant driving from mall to mall to find a wider selection or hanging out on a school night. That is how I grew up thinking about refund checks… like some sort of magical windfall of new shoes, purses, and dresses. Now fast forward to the present, I now know it’s better to try to break even than to get a fat refund. In reality, if you are receiving a large refund then you are paying too much in taxes throughout the year.

Divide and Conquer Your Money

If you are like me and you know you will be getting a refund of some sort, it is important to find a better way to spend your money than blowing it on a  new tv or handbag. Before you even receive your refund, you should already have an idea of what you may be getting back. Take this time to divide your money, so when you actually received it, you will be less likely to blow it recklessly because you have already decided where it is going. For some, this will take some serious financial discipline, but in the end, it’s worth it! I plan to make my money work for me by using these four categories below to get me started.

        • Fund your funds. If you don’t have an emergency fund of at least $1000, now is the time to start paying yourself.  You should think of this fund like those Chinese finger traps that kids used to pay with- it’s easy to put stuff in and difficult to take things out!  If you already have at least a $1000 Emergency fund, then you should take a percentage of your refund and put aside for your savings account.

        • Pay Down Debt.  This is the time to give your “snowball” effect an extra boost. Putting a portion of your refund toward your debt with the lowest APR (annual percentage rate) or lowest balance will help you pay get out of debt faster and feel good about your accomplishments.  Remember, you don’t have to have thousands of dollars all at once to start getting out of debt. Every payment above the minimum helps you get closer to your goal.

        • Take Care of Things You Have Been Putting Off.  If you have been meaning to call the plumber over to fix that leak you can’t find (raises hands) or get the brakes on your car checked out (raises hands) or even get the shoes with that weird heel repaired (raises hands) then take this time and money to do it.  These are things that people put off because they don’t have the money or time.  You now have the money, so make the time.

        • Prioritize Fun.  When budgeting your money, you have to remember to prioritize for things that bring you JOY.  Set a goal and when you accomplish it, tap into this category and unleash your fun fund.  This could mean buying those shoes you have had your eye on, a spa day, or planning that impromptu weekend with your loved one(s), girlfriends, or even by yourself!  It doesn’t have to be big, but it does help if it is something that brings happiness and drives you to work toward your goal. 

How Do You Divide Your Refund?

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{Fashion Cents} Budget Friendly Fashion Statements

Wait… what does her bag say???

Years ago, the fad was to show people “how” many things you could afford, as people would brag about how much they spent on this or that. While this is still true in many cases, I am noticing an even cooler trend that is fun, witty, and fashionable. What is it, you ask?- Fashion Statements! No these aren’t the statement shirts and bags that were super popular in the early 2000s that had quotes from people like Paris Hilton and Nicole Richie. These are fashionable acknowledgements of the times, with phrases like, “Can’t Afford a Birkin” and “My other bag is Louis Vuitton”. Occasionally, I would see someone with a bag like this and I would always chuckle a bit at the boldness of these women. I guess I was just surprised by the fact that these women were the opposite of the masses I see rocking fake labels, act like they are real, and suddenly make others feel bad for not having what they have. I mean seriously, no one believes your Birkin is real on a $22,000 salary and it doesn’t even come in that color, and having a purse doesn’t make you better than others…I’m just saying.  I think the problem is that sometimes great style is confused with a name brand.  Trust me, not all designer fashion is stylish, but the examples of these awesome, budget friendly, designer inspired fashion finds below, are.

Below are a few of my favorite “Statement Looks” :

She Makes CentsMy other bag is Louis VuittonCeline T-shirt

Photo Credits: Skreened, If You Seek Aimee Fashion, & Style With Benefits

Which look would you rock?

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{Smart Money} Is Education a DEBT Sentence?

Education

There is a quote that states, “If you think education is expensive, try ignorance”. Unfortunately, this quote is true on SO MANY levels. While many people associate the word ignorant with being dumb or stupid, it’s simply the condition of being uneducated, uniformed, or unaware. After graduating from Spelman College, I made both smart and dumb decisions regarding my student loan debt. I was told by my aunt that paying your student loans is a great way to establish credit. I put in an extra effort in paying Sallie Mae, so much that I had it paid more than year in advance. This was smart, ignorant, and sometimes dumb at the same time. It’s smart because I really never had to worry about forgetting to pay the bill. I felt extremely proud of myself for not being another “irresponsible” 20 something. It also revealed my ignorance because I should have been using that extra payment every month to pay down the balance NOT pay it in advance. I ended up paying interest when I could have been slaying the balance, which ultimately shortens the life of the loan. However, it wasn’t until I was in between jobs and not paying on the loan at all because the next due date was a year from then that I started digging a hole that I am still trying to get out of four years later. For one, my interest was accruing at about $8 a day, so a lot of the money I thought I was saving was now been tacked back on to the overall balance. It got worse when after the year was up, I still wasn’t working and I accepted an offer to postpone my payments for a year. That was back in 2011 and after yesterday’s phone call to Sallie Mae, my decision to postpone is still hurting my finances.
I pay about $200 a month for my student loans and recently got a series of letters saying that if I qualify I should sign up for automatic billing, which would let Sallie Mae automatically deduct money directly from a specified account every billing cycle. The incentive you ask? A .25% reduction in my student loan interest…equaling about $50 a month and $600 per year. I called Sallie Mae on yesterday, only to find out that I did NOT qualify. Apparently, if you post pone your loan at ANYTIME over the life of the loan, you lose eligibility for any interest rate reduction. Had I known this I would have been the never postponed my loan, but this secret penalty was never in any of the documents I agreed to.  Looking back I would have rather roughed it out. So I guess the quote rings true. My education was expensive but my then financial ignorance could cost me more in the end.

We would LOVE to hear your thoughts?

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Fashion Cents} Brand Loyalty or Brand Validation?

love-chanel1

Danielle and I have discussed how the psychological obsession with expensive products and luxury labels can lead to financial trouble. While setting up shop for the most relaxed SMC meeting ever, we discussed our favorite brands. Danielle likes O.P.I. nail polish and has a shoe game that would blow you away. I, however, have recently recovered from a serious infatuation with True Religion brand jeans and the both of these are pricey for the types of products they are. Sometimes within one’s own living circumstances, it makes no sense to step out of one’s’ budget for the sake of feeling validated by a brand. So why do so many people do it? Which has more value, brand loyalty or brand validation?

Let’s begin the conversation by defining these terms. Brand Loyalty is your devotion to a particular brand because of its proven usefulness. This is a tried and true product or brand that has won you, the customer, over for its merit or quality. (THINK: I’m loyal to Charmin tissue because of its thickness.) Brand validation, as its name suggests, is when a product’s mere reputation trumps the importance of its merit; thus fueling one’s desire for the label more so than the product. Yep, we let a brand validate us without proving itself worthy of its cost.

Brand names and their reputations are impossible to evade. Because of this, it is almost too easy to get lost in a particular brand so much so, that we allow it to eat out our pockets. The place where both brand obsession and financial logic intersect is where I am in my journey to financial freedom….SMC too, since she has repeatedly admitted that Chanel makes her feel pretty. In no way am I discouraging splurging for yourself or investing in expensive products that will hold you down in the long run. I, for one, own expensive jeans that have lasted years. When operating on a budget, though, it is imperative to think critically about the items you choose to spend your money on, and why. Are you loyal to your brands because they actually fulfill their purpose, or are your brands validating you while nipping away at your money? Granted, there is no cookie cutter way to address the issue of our obsessions with luxury brands. However, acknowledgment of this issue is a surefire way to begin searching for smarter ways to shop for the things you love…while staying within a budget, of course:)

Have you ever allowed a brand names to validate your purchase?  

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{Money Challenge Remix} How to Save $1300+ On Any Budget

Click here for the updated 2016 version!

Okay, so we are just 3 weeks in and I started falling behind for my 52 week money challenge. I decided at the start of week one to try this challenge in reverse. That means I will be saving more money at the beginning of the year and less the closer we get to the holiday season. In my mind, this worked well. In reality, it could work well. So far, though, my results haven’t been all that great and the fact that the fiscal cliff has chopped a chuck out of my check, hasn’t helped. I thought to myself…”Danielle, how can you find a way to honor the challenge in a way that will not hurt you financially?”  Then I came up with the idea to create a “bingo” style format.  At the end of the year, I would still end up with the same amount of $1378 and if I am having a tough financial week, I can pick a lower amount to save.  I crossed off 52 on week one, and I will cross of 5 and 4 to represent weeks two and three.  I decided to share this to maybe motivate someone who may have been thinking about “giving up”. 

52 Week Money Challenge from She Makes Cents

{What’s Your Preference} Numerical Order, Reverse, or Bingo Style?

Email me if you want my handy Bingo Style Sheet!

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{Save It} Target Plans to Price Match Top Online Retailers Year-Round!

Yesterday Target today announced plans to price match top online retailers year-round, including Amazon.com, Walmart.com, BestBuy.com and Toysrus.com (including Babiesrus.com). Target stores will also price match items found on Target.com. The new policy, which takes effect immediately, will combine Target’s previous price adjustment and competitor ad match policies into one simple, easy-to-use Price Match Policy that now includes select online retailers. If a guest buys a qualifying item at a Target store and then finds the identical item for less in the following week’s Target circular or within seven days on Target.com, Amazon.com, Walmart.com, Bestbuy.com or Toysrus.com or in a local competitor’s printed ad, Target will match the price. “Guests can confidently shop at Target every day for the best value in retail,” said Gregg Steinhafel, Target Chairman, President and CEO. “We know that our guests often compare prices online. With our new Price Match Policy and the additional five percent savings guests receive when they use their REDcard, Target provides an unbeatable value.” Target introduced its first price match policy, the Low Price Promise, in 2009 and began matching select online competitors for the first time this holiday season. Price match may be requested at Target’s Guest Services prior to a purchase with proof of current price or by bringing the original Target receipt and proof of current price.

For more information about price match at Target, click here

{52 Week Money Challenge} The Easiest Way to Save $1,000+

Click here for update and a “remix” to this MONEY CHALLENGE!  Can we say…so much easier to save, than the original!!

SMC- 52 Week Money Challenge

Today I was introduced to the 52 Week Money Challenge by a fellow blogger, DLWinfrey from Pretty Girls Rock Dresses (PGRDresses). The challenge is to make a weekly deposit that reflects the number of weeks of the year. For example on week one you deposit $1.00 and on week 27 you deposit $27.00 and so on. It sort of reminds me of when I was little and my big brother would give me money that corresponded with my age ($5.00 for my fifth birthday and $10 for my tenth birthday). This is week one of 2013, so if you are interested, you better put your dollar to the side. I plan on using the money saved throughout the year for holiday purchases and paying down credit card debt. Just think, by this time next year, I could have saved $1,378 just by participating in this challenge. While I don’t know who came up with this challenge, I do thank them. It’s easy, it’s fun, and it won’t break the bank.  Plus the remix of this money challenge makes it so even easier.

52 Week Money Challenge

What Will You Do With Your Savings?

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