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How to Create a Budget in No Time!

One of the most important things you need to do when it comes to your financial health is to create a good budget. Having a budget, and sticking to it, can lead to greater financial stability, regardless of your socioeconomic status.

Having a budget means setting limits, being disciplined and being responsible. When you have a good budget, in writing, you know exactly how much money you have, and what you are spending it on. You will also probably find a few surprises and notice some ways in which you can have more money in your pocket!

Here are the steps you need to take to develop a budget:

1. Write Down All of Your Income

This part is pretty easy if you only have one regular job. But, if you have any part time work, or you have any other sources of income (e.g., tips, odd jobs, etc.) then be sure to include these numbers in your total income section of your budget. Most people will develop a monthly budget, so do some calculations based on your weekly or bi-weekly paycheck to get the most accurate numbers. If you prefer, you can certainly make a weekly budget, but this may be a little more tedious than most people want.

2. Write Down All Fixed Expenses

Fixed expenses include all of the monthly expenses that you are “always” going to have. This generally includes things like rent/mortgage, phone bill, car payment, insurance payment, student loans, utility bills, and anything else that you pay on a regular, monthly basis.

Typically your fixed expenses will be around the same amount each month. Fixed expenses are generally those expenses that you cannot NOT pay, rather than being the type of expense that you can get rid of. Sure, you could always find a cheaper apartment, but you will, most likely, always have to pay rent or mortgage. Lowering your fixed expenses is more difficult than lowering your flexible expenses.

3. Write Down All of Your Flexible Expenses

Flexible expenses are those things that you spend money on that might change from month to month, and you may have a bit more control over how much you spend in each category. Not all flexible expenses can be eliminated—you definitely need to spend money on groceries and transportation, for example—but you do have ways to cut these costs in many instances.

Other variable expenses may include fitness center memberships, entertainment, travel, clothing, dining, personal needs and spending money. When you make this part of your budget, you need to prioritize the expenses, and make sure you have enough for the essentials, like food, medication, personal grooming and other critical things. Less important, and more flexible items would be entertainment and dining out, for example.

Take a look at your spending in each category—this is the part where you might find some real surprises. That tasty coffee you grab each morning on the way to work? Is it really worth $80 per month? These are decisions that you have to make.

4. Plan for Saving Money

As part of your budget, you should be planning to save some money. Many financial advisors will encourage their clients to save at least 10% of their net income into a retirement account. The more you save, and the earlier that you save it, the better off you will be later on.

Saving money should be included as part of your fixed expenses, as it is so important for your future. In addition to saving for retirement, you should plan to put a little bit of money away for emergencies, or even something special, so that you are not tempted to put a large purchase on a credit card (unless you can pay it off right away and get points!).

5. Track Your Budget Carefully

It is important to not only develop a budget, but to pay attention to it and stick to it. Monitor your spending and your savings, and you will find that you have more control over where your money goes. Whether you use a formal online tool (there are many to choose from), a simple spreadsheet on your computer, or even a pencil and paper, keeping track is an essential part of having a budget and being financially responsible.


Budgeting your money is the first step toward financial stability and financial freedom. Understanding where your money comes from and where it goes makes it easier to save and spend. Set reasonable goals and reasonable limits, and you will quickly become aware of your money. You will find ways to cut your spending and redirect your funds toward what you really want to be spending your money on!

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5 Steps to Getting Out of Debt

If you are like many Americans, you may be finding yourself over your head in debt. With many losing jobs yet having rising expenses, people are not only becoming more accustomed to living on credit, but also becoming less likely to be able to pay all of their bills.

Once you start riding the slippery slope of skipping payments, you begin accruing various penalty charges, higher interest rates and more. Soon, your debt load will be impossible to pay. For some, bankruptcy may be inevitable. But, long before that, you are hopefully taking some significant steps toward getting out of debt and learning how to live as a financially responsible person!

Here are five steps to take that will help you get out of debt:

1. Assess Your Income and Your Spending

This means writing down exactly how much money you make each week or month, and exactly where every dollar is spent. Once you document where every dollar comes from and goes to, you will start to see some distinct patterns. Analyze the information carefully. Some guidelines to consider are spending no more than 25% of your total net income on housing (rent or mortgage), and no more than 60% of your total income on all of your loans (mortgage, auto, personal, student, etc.) and credit card minimum payments each month. These guidelines may seem tight, but they come from the basic qualifications that banks look for in a potential homeowner, making them fairly solid guidelines to follow for good financial health.

2. Get a Comprehensive Credit Report

Find out what your credit score is, and what factors are affecting it. Make sure that everything listed in the credit report actually belongs to you—you would be shocked to realize how many credit reports contain serious errors. As you get out of debt and watch your credit score rise, you want to ensure that all of the information is accurate.

3. Make a Budget

Of course, if you are like most people, after step #1, you will be horrified to discover that you are nowhere near these guidelines. So, where are you spending your money? Start out by listing the things that you cannot avoid paying for (housing, transportation, food, utilities, student loans), then list your other monthly expenses and the exact amount you can allot for each. Be sure to include some sort of savings, experts recommend that you put away at least 10% of your net income to save for unexpected expenses or your future.

4. Cut Out Unnecessary Expenses

Are there things that you can live without? Do you really need to have 600 channels on your cable service? Can you make your coffee at home in the morning instead of spending several dollars on the way to work each day? How about a bag lunch a few days a week? Are you using your gym membership (although you should be, if you are not then you should cancel and get out of the monthly fee). Watch your utility usage—turn your heat or air conditioning down and replace your light bulbs with energy efficient versions. Each of the costs that you cut will leave more money in your budget that can be put toward getting out of debt.

5. Start Paying Off Your Debt!

There are two functional ways to do this—one helps you get out of debt, and the other may help you set smaller, interim goals that will help keep you on track. The fastest way to get out of debt is certainly to put as much money as you can toward paying off your highest interest loans and credit cards. The faster you pay these off, the more you are going to save. But, if these accounts have large balances, this may seem like a very daunting task. This leaves another option, paying off the smallest debts first, so that you can essentially “cross them off of the list.”

When you start seeing the list of people or companies that you owe money to start getting smaller, you can see your progress—which can be highly motivating. Plus, even though these might be smaller amounts, you can then take the money that you put toward each of these monthly payments and put it toward the next largest bills. As you pay off smaller debts, you will start to have more money per month to put toward the larger bills.


If you follow these guidelines, you will find that your debt slowly but surely will go down. If you are finding it difficult to make ends meet, consider finding a second job to get some extra income, and then be sure to put that extra income toward paying off your debt! You may never be completely debt-free, but you will find that you are much more comfortable!

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Chase Slate Balance Transfer Credit Card Review

The Chase Slate credit card is changing the game in its particular market niche. Those of you who carry a balance — and/or maybe think it’s about time to transfer that balance — will definitely want to get a load of this.

Typically, cards with a 0% introductory offer for balance transfers still charge a balance transfer fee of (usually) 3%. This tends to still be a favorable offer, but it leaves the consumer with some calculations to do. If your current credit card balance has an APR of 18%, say, then that means it takes about two months for the balance to accrue 3% interest. So the question becomes: is it worth it to pay two months of interest upfront in order to secure 0% for over a year? How quickly could you pay it off otherwise? Whip out the calculators and spreadsheets…

Oh wait, except with the Chase Slate, you don’t have to worry about any of that at all, because there is no balance transfer fee. None. And there is still an introductory 0% APR on all purchases and balance transfers for the first 15 months.

Believe It, Transfer It

Sound too good to be true? It’s true-blue, in classic Chase style. Clearly, they know how to keep all levels of their cards competitive. There are some details to be aware of, though.

  • Balance transfers are free as long as you make them in the first 60 days. After that, it’s the usual 3%.
  • Remember that you can’t transfer balances between cards issued by the same bank. That means no transferring balances to the Slate from any other Chase card.
  • You can’t transfer balances that are higher than your credit limit.
  • And if you do accidentally go over your credit limit, or make a late payment, on ANY Chase account, you can kiss your introductory 0% APR goodbye, because you will be slapped with a 29.99% penalty APR. Yikes!

By the way, there’s also no annual fee, as to be expected. There is a foreign transaction fee, though. You can’t win them all.


There’s another reason that the Chase Slate is particularly suited to those who carry a balance. This card, along with a few other Chase cards, comes with a nifty tool called Blueprint that helps you track your expenses and set up payment plans. Directly from your browser, you can use create plans to pay certain purchases or categories of purchases off in full every month, set up payment plans for large purchases or even your whole balance, or simply track your spending. Your created payment plan then shows up on your statements alongside everything else.

Although… Let’s put our critical thinking caps on for a moment. Chase proudly advertises that with Blueprint’s Full Pay feature, you can “pay no interest on selected items,” …wow, pretty sweet!… “if you pay them off in full.” Wait, what? How is that any different from any credit purchase ever?

It’s not. Don’t be fooled — Blueprint does not give you any special interest rates on select items, or do anything really. It’s just a tool that you can use for your own planning. It does nothing that a calculator, spreadsheet, calendar, or notebook couldn’t do for you. Except it’s prettier and easier to use.

There is great value in obsessive budgeting! But our advice has been and continues to be that you should pay everything off as quickly as you can — it’s that simple. You don’t really have to break your balance down by categories; it doesn’t matter ‘which’ dollars you pay off. You have to pay the whole thing eventually anyways, and every dollar left unpaid will accumulate interest charges. The faster you pay, the less you pay.

Still, Blueprint is valuable for its psychological benefit. If you feel overwhelmed, it’s nice to have numbers broken down for you. A good mindset is a valuable intangible asset. Chase claims that customers who use Blueprint’s payment plan features tend to pay off their debts twice as fast. So clearly, it works for many people. Despite, you know, not actually doing anything. Hey, whatever lights a fire, right?


The Chase Slate comes with no rewards program. Boohoo. Don’t be surprised; that’s not what this card is about. It’s about becoming debt-free. Nobody who carries a balance should sign up for a rewards card, because rewards cards’ interest rates are much higher, certainly higher than the rewards.

But you do get $0 liability for fraudulent charges, as well as protection for your purchases against loss or damage for 60 days (up to $250).

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Is A Roth IRA The Perfect Savings Plan For You?

As far as retirement plans go, a Roth IRA can make the most sense for a lot of people. Both Traditional and Roth IRAs provide a way to shelter your savings from taxes. Typically, when you invest in, say, a mutual fund, you pay taxes on the money you put in and then you pay more taxes on your capital gains. Traditional IRAs allow you to defer taxes and Roth IRAs let you escape paying tax on earnings altogether.

Pay taxes now or later

In a traditional IRA, you can contribute money pre-tax. So if you made $40,000 and put $3000 away in your traditional IRA, then you only get taxed on $37,000 this year. But a few decades down the road, when you are ready to retire and dip into your IRA, then you do have to pay tax on your contributions and the earnings they have gained.

On the other hand, with a Roth IRA, the contributions you put in are post-tax, but when you withdraw money later, you don’t pay tax, provided you meet certain guidelines. These guidelines include the account being at least 5 years old, AND you being either a) disabled, b) at least 59.5 years old, or c) qualifying for some other exemption. Follow these requirements and you’re looking at a retirement account that lets earnings grow tax-free. Pretty sweet. There’s also no required minimum distribution (RMD) as there is with a traditional IRA, which forces you to start taking money out once you hit 70 — because Uncle Sam has waited long enough for his taxes. With a Roth, the tax man already got his, so you can leave it for as long as you want, or even pass it on to your heirs if you wish. (Inheriting Roth money is particularly nice because it is tax-free!)

Roth advantages

Plus, since you already paid taxes, every penny of your contributions is still yours, with nothing for Uncle Same to quibble over. That means that as long as you wait 5 years after opening the account, you can withdraw as much of your direct contributions as you like without any fees or penalties. (If you do not wait 5 years, you’re still subject to the usual 10% penalty.) What this means is that a Roth IRA can simultaneously serve as an emergency back-up fund. Not only that, but you are also allowed to withdraw up to a lifetime maximum of $10,000 of the earnings for certain expenses such as education or your first home.

A final pro for the Roth IRA is that it effectively allows you to contribute more. Contribution limits vary with income level, but everybody is looking at no more than $5,000 in contributions to an IRA annually. (Except those 50 years of age or older, who get to put in an extra $1,000.) Let’s assume you want to max out your contributions — not a bad idea. If you put in the $5,000 max into a traditional IRA, and you’re looking at a 20% tax when you take it out later, you’re really only putting $4,000 away. With a Roth, since you’ve already paid taxes and will (hopefully) pay no more, you really are putting away the full $5,000.

Decide what’s right for you

So is a Roth IRA the right choice for everybody? Not necessarily. The biggest determining factor should be your guesses about taxes in the future, both for yourself and the country in general. If you foresee being in a lower tax bracket when you retire, then the traditional IRA makes more sense. If you think you will be a higher tax bracket when you retire, go with the Roth. Also consider how you predict taxes will change for everyone, on a country-wide level. Many Roth supporters point to the fact that we are at a historical low for taxes, so the time to pay is now rather than later. Then again, anything can happen. Congress might even change the laws that allow for tax-free withdrawals in the future.

So, nothing is risk-free. That’s the nature of finance. Assess your own risk-tolerance, your hunches, and determine what the best savings plan is for you.