Traditional Personal Finance Revisited

“We’re not in Kansas anymore, Toto” Dorothy said in the Wizard of Oz; which pretty much sums up my view of life in America, 2011.

So what to do?

The “new normal” means we each have an opportunity to start from where we are to create successful future outcomes from this moment on. That is, if we choose to release mainstream media’s “normalcy bias” perfected over generations to perpetuate (no matter what) the illusion of normalcy!

Central to the normalcy illusion is a consumption-based definition of success designed to override concerns in a shifting economic landscape. Yet all around us hard evidence virtually screams the naked truth of the many ways the “normal” we once knew, no longer exists.

Below are my personal-finance recommendations that dovetail but do not exactly match those of traditional advisers. Why? Traditional recommendations typically ignore the risk factor represented by how money works in context of its monetary system. Same as with health issues; without knowledge of the cause of symptoms, treatments generally lack full effectiveness.

When it come to personal-finance success, responsibility for how we earn, spend, save and invest is obviously essential. However, financial objectives can easily elude us if we lack the whole story about money. The missing piece is systemic in nature. Overlooked and under reported, impersonal monetary-system mechanics grind away to leave families vulnerable; undermining goals of stability and wealth-building.

Also known as a hidden tax. Who benefits?

Central banks worldwide (Federal Reserve for the U.S.) issue currency at the precise moment it is borrowed via an automated procedure called fractional-reserve banking. Therefore, money is actually a debt instrument (Federal Reserve Note). This private profit, interest-delivering system was designed centuries ago.

Over time debt grows per compounding interest and purchasing power diminishes with increased cost of living. The cost of living rises as businesses add their interest cost from bank loans to the cost of the goods and services we purchase.

And so grows the gap between the haves and have-nots.

That brings me to the pivotal issue of how much purchasing power $1.00 has in the marketplace today. One dollar is only worth 4.5 cents and an online inflation calculator proves my point. An item purchased for $1.00 in 1913 (when the Federal Reserve System was created) would cost $22.10 in 2010; a 2000% increase in inflation!

It’s a fact: Skilled advisers are definitely helping families lower their debt-loads and modify their budgets. That said, the “good-debt, bad-debt” conversation remains as conventional truth; leading individuals and families to believe they can tweak their budget and lifestyle here and there to make it through to better days.

Unfortunately, such household gains may not last. Without a working knowledge of money as debt, even the most sincere efforts may falter as a rising cost of living erodes hard-won forward movement. When following conventional financial wisdom, the solution to keeping up and making ends meet could well end up, once again, as participation in the vicious cycle of credit and debt. Who benefits?

More choices with the big picture.

When we add the missing-piece about money to our knowledge-base and decision-making process we also gain additional financial strategies. Those who set out to explore alternatives outside-the-traditional-personal-finance-box tend to develop a new part of their brain.They uncover a world of possibilities (perhaps previously under-valued) along with the thousands of others on the very same mission!

Here are my personal finance action-steps formulated to help individuals and families build a solid financial foundation. Savings and investments are very important but in the 2011 economy they will be most SUSTAINABLE when a solid present-day foundation has been attended to first. You’ll know you have completed the “foundation” step once you have more money coming in to your household than going out for at least four consecutive months!

  1. Write down your short-term, mid-term, and long-term financial goals and put them somewhere to easily refer back to them.
  2. Review your goals (at least) on a weekly basis.
  3. Figure out your exact financial status today. How much money a) comes in and b) goes out each month. Create a line-item and categorized itemization of money in and out. Don’t forget things like eating out and entertainment.
  4. Track your expenses and out-of-pocket spending precisely for at least one month. Save all receipts and record out-of-pocket information daily. Also determine the exact amount of money (or average) that comes in each month.
  5. Do you have more money going out than coming in? If so, exactly how much?
  6. Use your list of current itemized expenses to create an action-plan regarding how and by when you will lower or eliminate line-items that exceed the amount of money currently coming in to your household. This may mean creative downsizing.
  7. Create an action-plan about how and by when you will increase money coming in to your household. As debt becomes reduced or eliminated, this action step becomes the most important one in order to stay ahead of the cost-of-living debt curve for the long-term.
  8. As you focus on ways to increase cash flow, perhaps consider an independent trade or service that people will always need and that best suits you. For example, car mechanics, computer techs, hair stylists, barbers, clean-water suppliers, pet care-givers, delivery-service providers etc.
  9. Make debt-elimination a high-priority; the final goal being to consistently live within your means and pay as you go.
  10. Once credit-card debt is paid off, get rid of all but one credit card because credit access is actually an instant-gratification state-of-mind.
  11. Do NOT keep your one remaining credit card in your wallet. Leave it frozen in a bowel of water in your freezer. This tactic builds time into the otherwise instant-gratification decision-making mindset of a credit card in your wallet.
  12. You might even want to reallocate existing assets towards building your “more money in than going out” household-budget foundation more quickly. Since money (as debt) is worth the most today than it will be tomorrow, it’s best to put it to work today! A stable present situation will increase your well-being. Increased well-being empowers a healthy decision-making process
  13. Use cash first and foremost. Most people will pay more attention to what they spend when it comes straight out of their wallet.
  14. Stop shopping for entertainment. Shop purposefully using coupons, during sales and buy bulk whenever possible. Generally shop recycled including for cars.
  15. Include your children in the how and why of your decision-making process (should you accept this mission)and invite their imitation of your thinking and efforts.
  16. If you have savings and/or investments to preserve, keep some of YOUR money entirely out of the reach of the banking-services industry. They consider their own interests before they consider yours! More and more people are moving their bank capital into hard (tangible) assets.
  17. Specifically per 16 above, consider anything you have in savings, retirement funds or the stock market. (Remember the stock-market 2008 and FYI: The U.S. government is currently floating the idea of nationalizing 401(k)’s and IRA’s given their nearly 14-trillion-dollar deficit. In other words, individuals would lose control over their account and the government instead would ration annuity-type payments.)

Susan Boskey is an alternative financial consultant and author of The Quality Life Plan: 7 Steps to Uncommon Financial Security. Her book goes where no other personal finance book has dared to go. It not only exposes the systemic-root cause of the 2008-09 economic meltdown but perhaps more importantly, provides critical strategies for everyday people to turn the tide and build real wealth.

Five Ways To Handle Your Personal Finances

In order to live one’s life comfortably and well, it is not just necessary to earn enough money, but also have the acumen to deploy it in a manner that it yields good returns. People who are financially sound and successful are those who dedicate most of their time and energy in budgeting, managing and planning their finances on a regular basis. In order to make your money grow, you not just need to have the basic financial education and make a constant effort to enhance it. Here are five tips you can use to handle your money better.

Make a schedule and select a date in your calendar every week to manage and plan you finances.

People often dream of becoming millionaires but they don’t spend the necessary time and energy for planning their budget and finances. Make it compulsory and recurring habit to make at least one day in a week your money date. This time should be spent in figuring out what is happening to the funds you have, whether you can deploy them in better investment avenues in order to maximize your returns, whether you have any upcoming financial commitments. Make sure that you are up to speed when it comes to money matters.

Try to commit at least 30 minutes every day in reading about matters related to money.

Managing your money will not be a tall task if you have enough financial acumen. You may not have a background in finance yourself, but in order to make your money hard for you, you must make the extra effort to educate yourself financially. If you do not have enough knowledge about finances, you ca make a mistake with your investments that can cost you dearly. To avoid such pitfalls, make sure that you spend at least half hour each day, understanding the various aspects of finance. Red books, magazines, look through the internet and watch finance related programmes on television.

Talk to people you admire

Once you feel confident about finance related topics such as spending, saving, credit, debit, investing, retirement strategies, you can also try to consult with people whom you admire. These people may be mentors, entrepreneurs or just those who have found success financially. In fact a great way to do things is by joining many online forums on investments.

Make and test your own financial strategies in life

Ultimately it is all about what works for you. You may read n-number of books and garner advice from people who have achieved financial success, but none of it will work for you if you do not have the wherewithal to chalk out your financial strategies. If you are not feeling confident all at once, start investing small amounts in various places that you think will work best for you. Once you have done so, you have to wait and watch to see the results. If you see that your strategies are working, meaning your money is actually growing because of smart deployment, you can go ahead and allocate more funds in the same avenues. The golden rule of investing is not to put all your eggs in one basket.

Opting for the services a financial advisor

If all of this does not appeal to you and you neither have the time or energy reading about money matters, you can repose your faith in the service of professional financial planners. For a small fee that they will charge you, they will do all the hard work for you to see your money grow. These are people who are cued on to the latest developments in the world of finance, so you can trust them with their decision.

Powerful Tips For Personal Finance

Do you ever stop to wonder where your cash goes each month? Does it often appear as if you can not afford to do things because your monetary requirements are holding you back? If you realize that you are asking these kind of questions, maybe you need to take a quick look at your monetary situation and evaluate whether you are practicing good private finance management or not.

Poor private finance management means you pay out more money than you need to, therefore leaving less to save and invest. Planning your private finances does not always come naturally, and regardless of if you are just starting to take your fiscal matters seriously, you likely need some private finance tips. Personal money management is a habit, a habit that is essential for long term financial success and independence.

Appraise your present monetary situation. Collect correct information regarding your private monetary situation. Work out your net worth which includes the estate, saving and retirement accounts, and all the other assets. This is going to help you decide how much cash you can put aside for meeting future wishes and goals. A basic private finance tip is to make a budget. A private finance budget is info made of your earnings and costs and the more correct this info is, the likelier you are be ready to achieve your goals and realize your dreams. An individual finance budget should be made for at most one year at a time and include an inventory of your monthly costs. All costs must be included.

Private finance budgeting needs some little sacrifices. To be well placed to make good private financial choices and set concerns, you have to know where your cash is basically going. Start your financial position and achieve your goals. Get an electronic bill pay. This is a handy method to pay your debts. You pay them electronically, by direct withdrawal from your deposit account. You may even link your bill pay service to your private finance budget, so that your expenditures are immediately entered in the proper category. Private fiscal management can be easy.

Make an investment and finance plan. Now the elemental state of your private monetary security has been revealed, the time’s come for the more wealthy part of your private fiscal life. You have to make a private finance plan of what you truly want in life that money can buy. Your private finance plan can be as straightforward or as detailed as you would like it to be. Discover how to eventually begin to implement this plan and get the cash to finance it.

This journey is the most engaging and exciting part of private financing you may have toward financial liberty. When you assume control with your cash, you do not have to stress about debt taking command of you. As I mentioned above, money management is a habit, and bad habits can take time to replace with better ones. The key is a plan that you stick to religiously.

Successful Financial Budgeting Tips

Personal finance has always been one of the crucial aspects of success of an individual. Execution of one’s personal finance budget often requires discipline and perseverance. Many people obtain assistance from professionals such as accountants, financial planners, investment advisers, and lawyers.There is also personal financial software to help with your financial budgeting which saves a lot of money  and certainly your time.

Financial budgeting is the key to unlock your monetary success as well as your means of reaching your goals and dreams. Everyone wants to pay all their bills on time. Successful debt and asset supervision is the starting place for good credit. Unless you have unlimited funds to spend however you wish, the place to start is with good personal budgeting skills.

Here are some helpful tips in creating your personal finance budget:

  • Create a personal household budget which includes all your monthly and yearly bills. You must also include your spending money, savings goals, and retirement funding. It doesn’t matter how much money you make, it’s how you spend it. A personal and household budget will help you make payments on time, provided you follow the plan. Aim for your housing expenses to be about 33% of your income. If that is not possible, cut some expenses or look to at ways you can make more money.
  • Follow a debt management program. Your debt may overtake your income and then you are forced to make late payments on bills or no payments at all because you don’t have the money. This becomes expense and can topple you over. A total debt payment (which ideally should be zero!) shouldn’t exceed 30%.  If it does, look to consolidate and chop ups some store cards with high interest. You can’t just spend money and hope you have enough for your bills. You must spend within a budget.
  • Use personal financial software to save you time and accounting fees. The software will ask the same questions that a personal finance advisor asks, without charging you a high hourly rate, during a financial planning interview. Everything is already put in to the software so you don’t have to start from scratch or think too much.

A Quick Guide to Managing Personal Finances

Managing your money and personal finances is easy with just a basic understanding of the world of finance. You can learn to handle yourself in stressful moments with this guide to personal finances, budgeting money, managing personal finances, using personal budget software or seeking finance help online. Our financial guide offers great value in assisting you in all areas of money.

Most people don’t think of themselves or their lives as a business. But from birth to passing, you are in business for yourself, the business of you. How you choose to manage your business is up to you. The same guidelines that apply to running a successful business also apply to leading a victorious life, both financially with your money and emotionally. Remember stress around money can affect your emotions negatively as well as your health.

Giving adequate service to our fellow human beings is the mirror of a successful business as well as providing value to their lives. If you seek to provide as much value to as many human beings in your life, you are sure to become a successful person and customers and wealth will knock at your door. So how does this apply to managing finances successfully you might ask?

Below are 4 important points of our guide from Personal Finances Online Help.com, to managing personal finances successfully.

  • Take extra effort in removing any emotion like dept anxiety or overwhelm from financial obligations worry over mounting bills and income. Removing the emotion from your personal finance budgeting will be a work in progress, and you should always remain on guard for over active emotions. Taking emotion out of dealing with your finances will help you come up with positive solutions and solve problems more effectively.
  • Managing your personal finances on a regular basis rather than letting the admin tasks mount up is important. That way you stay on top of where you are at, can change things, make better decisions ahead of time rather than always being in reaction mode or putting out fires. Avoid decisions that would lead to bankruptcy like over leveraging your loans or taking on financial commitments you don’t know how you can pay back.
  • Devote yourself to develop greater skill sets like budgeting, planning and even using budgeting software. Managing personal finances like a business is about seizing control of your destiny, both with your finances and your life. Try to be like the great business leaders and attack your future with vigour and enthusiasm. Overseeing your finances in this way, with boldness, and a belief in their importance can have amazing results. Lead your money with boldness, and like an army your personal finances are sure to follow
  • Using software to support you with your personal budgeting is a good idea because it contains spreadsheets that have everything in one place. You can see very quickly where your current state it, budget better, plan better, not to mention the time it will save you putting your own spreadsheet together. The ultimate personal finance software provides sufficient user-friendly features, allowing users to manage every aspect of their finances, including accounts, investments, future plans and taxes. Software will provide up to date information on tax laws and stock reviews to help you make knowledgeable decisions.