Posts tagged: money

How To Pull Yourself Out Of Financial Difficulties After A Challenging Life Event

help in financeSometimes, life can throw you a challenge, and they can often lead to unprecedented emotional and financial difficulties. Therefore, whether you’ve been made redundant, extreme weather has damaged your home beyond repair, or, you’ve gone through a costly divorce; it’s vital that you get your thinking cap on and figure out what to do financially. Working out your money and where it’s going as soon as possible, will help protect you and your assets in the future. The following are some things you might need to consider, should you find yourself in financial strife.

Maintaining Your Income

During difficult life events, like divorce, it’s important that the other key areas of your lifestyle remain as intact as possible. Therefore, it’s essential that you inform your employer of any significant changes to your situation, so that they understand that you may need some time out of the office, and you won’t have to jeopardize your job. If it’s your job that you’ve lost, and you find yourself redundant, then you must financially plan immediately, and pick up any work available, while you search for your next career move.

By maintaining a steady income, and carefully considering any purchases, you’ll be able to ease the transition into any other major life changes. This will help your and your family, both financially, and emotionally in the future.

Rebuilding Your Credit

Life changes that cause financial hardship and struggles can often lead to you to paying for things with a credit card or not paying back loans and bills on time. These difficult financial situations can result in bad credit, and for you to figure out how you’re going to rebuild your life, you’ll need to seek professional help and advice. You can research into credit repair services, find out; does Lexington Law really work and discover what you’ll need to do to get yourself out of the red again.

Selling Your Assets

In order to release some equity, and get back on your feet financially, you might need to make some tough decisions in regards to your property and bigger assets. Downsizing your accommodation, or replacing your car with an affordable alternative, are decisions to make quickly so that you can save as much of your money as possible. Check out 10 tips to sell your home fast here.

Even though it might be a tough process to go through, relinquishing your expensive assets could give you the cash you need in the present, and secure a lucrative future for you and your family. Remember that nothing has to be permanent, and if you’re willing to make the sacrifices now, you’re likely to benefit in the long run.

Changing Your Lifestyle

It’s all very well ensuring that you’re still working and that you’ve downsized to affordable alternatives; however, if you continue to spend money in all the same places as before, you’ll run out of it pretty quickly. You’ll need to rethink where and how you shop, and ensure that your monthly outgoings are significantly reduced; so that if you do have spare cash, you can save it for the future.

Should You Borrow Or Earn Yourself Out Of A Financial Crisis?

crisis in financeIt is not unusual for family finances to take a tumble and for everyone in the family to get concerned about how you are going to get through it. Many things can trigger a very sudden financial crisis. In many cases, it is a business failure. Many new businesses fail and they can take all of the money that you have invested in the ventures with them. On other occasions, it is a gradual decline and you have been throwing good money after bad for years. Perhaps you even saw the crisis coming but chose to ignore it.

At other times, it is a job loss that triggers the crisis. Most families can survive a redundancy or a job loss of one wage earner if there is another wage earner that can support the family for a few months. However, if there is only one wage earner, a job loss can throw the whole family into financial turmoil.

For many families, it can be an unexpected expenditure or an accident or ill health that triggers a financial crisis. Perhaps you had a car accident or an accident at work and you can no longer earn the money that you used to. If the accident was not your fault, you may be able to start a personal injury claim and it is worth looking into that. You may even be able to get an interim payment of compensation to help you get by. Sometimes it is a big purchase that tips the family finances over the edge and it can be hard to get them back on track.

There are only two ways to get yourself out of a financial crisis. You either need to borrow or earn your way to financial security. Here are a few ideas to help you decide which is best for you.

Keep your outgoings to a minimum

You need to get a clear picture of how much you have to earn or borrow to get by each month before you can put a plan together. There will have to be some cutbacks in your family budget in the short-term. It is important that everyone participates in the savings so sit the whole family down and explain to them that you need to tighten your belts for a few months.

Start by listing everything that you pay out for each month. It is useful if you have your bank statement in front of you when you do this. List the large outgoings first. These are usually the items that you can’t avoid paying out and include the mortgage or rent, car loan and utility bills. You even have to list the minor items such as children’s activities and the takeout coffee you have every morning.

Try to work out which ones you can do without. Try to negotiate a rent or mortgage reduction for just a few months and agree to make up the shortfall once your finances improve.

Luxuries will have to go! Eating and drinking costs a lot and is a luxury that you can do without for a month or so. Try a takeout instead or save even more money by making your own. Healthy, home-prepared meals take a while to make but save you a lot of money and do you good!

Borrow what you need to get by

There will be occasions where you need to get hold of money fast and you will not be able to wait to earn yourself out of trouble. Quick loans give you the cash that you need when you need it. Everything is done online and there are hardly any forms to fill in so the process is much quicker and streamline. There is a credit check involved and there is a huge variety of lending options so you can always find the loan that is just right for your circumstances.

If you have fallen behind on your mortgage repayments, the last thing you should do is ignore the letters demanding money. It is important that you contact the company quickly and sort out a repayment schedule that is manageable.

Borrowing what you need can give you peace of mind and free up your time to get on with what is important which is finding another permanent source of income.

Find a new source of income

Obviously, your ultimate aim is to find another permanent job or to get another business up and running but this can take time. Dig out your CV and give it an overhaul. Refresh your personal statement and update your qualifications. Then start sending it out to potential employers.

In the meantime, it may be possible for you to take on a part-time job to help out with bills. There are always retail jobs and positions in catering and hospitality available. Could you do some babysitting in the evenings or sell some things to raise some cash?

Whilst you are finding it hard to manage financially, you must check that you are receiving all the benefits that you are entitled to. Check out with your local authorities or go online to find out more. There may also be welfare organizations that can help you.

If you have a spare room in your home, it may be possible for you to take in a lodger. The rent will help towards the cost of the mortgage and they will chip in for the household expenses such as gas and electricity.

You could also look into earning some money from home. Many people make good money working from their bedrooms! You just need an internet connection and a laptop and PC. You could work as a website tester, an administrative assistant or even as a freelance writer. There are literally thousands of jobs available through sites like Guru.

You do the jobs in your own time and so you will always be available to attend that important interview to get your new full-time job.

How Much Should Your Home Down Payment Be?

financial quakeWhen you’re buying a home one of the biggest considerations is your down payment. Depending on the loan you are getting, you may have a specific requirement for how much you want to put down. That’s the minimum for that loan, though, and doesn’t mean you can’t put down a larger amount. But should you? That’s a choice only you can make. Before you decide on what level of down payment you want to consider, take a good look at your finances and be sure that any down payment amount you choose won’t leave you in financial peril.

Putting 20% Down

Among your down payment options is choosing to put 20% of the purchase price down on the purchase of your home. This option is often chosen because it generally avoids the requirement for you to pay Private Mortgage Insurance (PMI). However, not everyone has this level of down payment, and there are times when it pays to keep money where it is and not pull it from savings or other investments to use it for a down payment. In some instances, you could actually lose money by trying to avoid PMI with 20% down.

5% and 10% Down Loans

For people who don’t have a 20% down payment or don’t want to put that much money down on their home, 5% or 10% as a down payment is relatively common. Most people with good credit will qualify for these types of loans through various banks and credit unions, along with other types of lenders. Paying PMI will be required as a part of these types of mortgages, but in a number of cases, this PMI amount will not be high. With a low PMI and the ability to leave money in the bank or in investments, this can be a chosen option for many buyers.

FHA and the 3.5% Down Requirement

When people choose a Federal Housing Administration (FHA) loan, the minimum amount they can put down with good credit and solid income is generally 3.5%. In some cases, an FHA loan may require them to put down more than that, such as 5%. The money they put down can be from their own funds, or it can be a gift from someone else, but it cannot be from a loan. There will be PMI required because of the small down payment, but this can allow people who do not have a lot of money to purchase a home so they no longer have to rent.

No Money Down Loans, Like USDA and VA

In some cases, the Veteran’s Administration and the USDA offer loans where a person doesn’t have to put any money down. There are specific requirements for these loans, and the seller of the home may be asked to pay closing costs in the transaction. Additionally, good credit is generally required, and for USDA loans, there may be specific areas in which the property has to be located. This can be a hindrance for someone looking for property under these types of loans, but the lack of a down payment can also make them attractive to some buyers.

Putting a Larger Amount Down on Your Home

Another option is to put much more than 20% down on a home. Some people do this on investment properties, but there are also people who choose this option for their primary home. They may do this to reduce the size of their mortgage payment, get a mortgage with a shorter term, or otherwise get more favorable offerings from their lender. They may also have money available to them that they aren’t investing, so they want to use it in a way they feel is wise. Paying more down can be an option for people with higher levels of income or savings.

No matter which option you choose for a down payment, it’s often best to consider a variety of options. Then you can make the right decision based on your specific needs and situation. There is no right or wrong choice when making a down payment on a home, because everyone has different circumstances. The ‘right’ down payment choice is the one you’ve thought about, understand, and that works for you.

Can You Really Afford Another Large Purchase?

online buyingWe all know how great it is to treat our family and ourselves to a large purchase. Maybe you have needed a new family car for quite some time. Or perhaps you have a relative’s birthday coming up, and you want to really push the boat out and get them a gift that they will never forget. But are you totally sure that you can afford the big purchase? If you aren’t too sure, it is a much better idea to check in with your finances rather than flashing the cash without knowing how worse off it might leave you. Thankfully, it isn’t too difficult to figure out whether or not you can afford a big purchase – you just need to ask yourself these questions.

Where Is The Money Coming From?

The first thing you need to figure out is where the money for this big purchase is going to come from. Ideally, you should already have the money in a bank account. This should be an account that allows easy access to the funds and doesn’t charge you for withdrawals. If you don’t have the money just yet, you should look into getting the best credit card available. When you are looking for a credit card, you should always take note of the interest rate, as this will affect your monthly payments.

Where Can I Get The Best Price?

Lots of us now do our shopping online, and most people have their favorite sites that they always visit. Most of the time, it tends to be the likes of Amazon. But are you sure you are getting the best price on your favorite site? If you only shop at Amazon, for instance, out of habit, it could be time to start to compare prices elsewhere. By shopping around, you will be able to find some really great deals and discounts.

What Else Could I Do With This Money?

Another really important question to ask yourself, do you have an idea of how else you could use the money? For example, you might have some responsibilities that might need the money. If your rent is due, then you shouldn’t use the rent money to buy a fancy new dress. Have you also started to put some money to one side for retirement? If not, then you might be better off using the money to start a pension pot. As you can see, there are a few useful things you could use the money for, and your big purchase can wait.

What Is The Returns Policy?

These days, most shops and stores have pretty good returns policies. However, there are still a few places that make it difficult for customers to return their items. If you do make a big purchase, it should be from a store that allows a full refund within thirty days. And make sure that they aren’t just going to refund you in store credit!

So, are you really sure now is the right time to make that big purchase?

Being Self-Sufficient When Self-Employed

premium payablesAs more people are leaving their very insecure permanent jobs and going down the self-employed route, there doesn’t seem to be many financial preparations for the future anymore. And it’s hardly surprising, given the current nature of unpredictability in the market. People are setting up their own businesses, and approximately 9 out of 10 small businesses are failing because people are ill-equipped, or the financial strain is way too much for them to bear. Living a lifestyle of self-employment can be all about living day to day while working all the hours under the sun. While this isn’t the most fruitful way to live your life, how can you make the most of a delicate financial situation while working for yourself?

Assess The Real Amounts Of Outgoings

Living in a hand to mouth way means that you seldom stop and take notice of how much you’re spending. If you get a big contract, you may feel that you are in the money and spend quite lavishly, which leaves you out of pocket when you’re left wanting for work. The best way to tackle this is to establish a base level of spending and stick to that, though it’s worth doing this when you’re in a good working contract and not when you’re struggling. Look at your outgoings and cut back on what isn’t essential. Have you been to the gym in the last 6 months? No? Get rid of it. Getting a selection of credit cards is handy when you’re self-employed is handy for expenses, but not for buying everyday items. The best way to avoid temptation is to lock them away and avoid remembering the PIN number. If you have pressing payments when you’re in the middle of a contract, you could use a credit card to make the payment and then use your earnings to pay off the card. With costs like insurance, you can pay insurance premium by credit card which helps to spread out the debt over a longer period of time. It all depends on the rate of the credit card you have. It is always ideal to have a 0% card for business expenses. So if you needed to travel to another country, the card could pay for the travel insurance.

Look At What You Can Claim Back

One thing that newly self-employed people forget about is what they can claim as expenses. Depending on where you live it varies, but if you operate out of your home, you can make the most of cutting back on your energy bills if you use one of your rooms as an office. So if you have a phone set up, the internet, and of course, all your electricity usage for your business coming out of this one room, you could try and claim some money back on your bills. The rules differ, but you can always speak to an accountant to get the bearings on this situation. Self-employment is a feast or a famine, but saving money is possible in light of circumstances. Just do your research, and make the most of what you are entitled to.