That thrilling moment when your money finally hits in your bank account can be both exciting and overwhelming. But what should you do next to make the most of it?

Let’s dive into a strategic approach to managing your finances effectively—from crafting a budget to tracking your spending habits.

1. Budgeting: Master the Skill of Creating a Budget That Works for You

Think of budgeting as your financial compass. It guides you to where you want to go financially. But how do you create a budget that truly works for you?

• Assess Your Income and Expenses: Begin by understanding all your income sources and fixed expenses. This will give you a clear view of your financial standing.
• Set Clear Goals: Whether it’s saving for a house, a vacation, or retirement, having specific goals can drive your budgeting efforts.
• Leverage Budgeting Apps: Tools like Mint, YNAB, or PocketGuard can make budgeting simple and intuitive, helping you stay on track in real-time.

Budgeting isn’t about limiting joy; it’s about opening up opportunities to achieve what truly matters to you.

2. Saving: Learn Strategies to Build a Robust Savings Plan

Savings are the cornerstone of financial security. But how can you ensure your savings plan is rock solid?

• Prioritize Savings: Treat saving as a mandatory expense. Allocate a portion of your income to savings before covering other costs.
• Automate the Process: Set up automatic transfers to your savings account, making saving a seamless habit.
• Build an Emergency Fund: Aim to save three to six months’ worth of expenses to cushion against life’s uncertainties.

Every dollar saved is a step closer to your financial goals.

3. Investing: Discover Ways to Grow Your Wealth Strategically

Investing is a powerful way to make your money work for you. Here’s how you can start:

• Know Your Risk Appetite: Understanding whether you’re risk-averse or risk-seeking can guide your investment choices.
• Diversify Investments: Spread your investments across different asset classes to balance potential risks and rewards.
• Seek Knowledge: Utilize resources such as financial advisors or online courses to enhance your investment acumen.

Investing isn’t just for the wealthy; it’s for anyone ready to plan for the future.

4. Paying Off Debt: Get Effective Tips on Reducing Your Debt Burden

Debt can feel like a heavy burden, but with the right tactics, it’s manageable:

• Catalog Your Debts: List everything you owe, including interest rates and minimum payments to prioritize repayments.
• Focus on High-Interest Debt: Tackle debts with the highest interest rates first to save on interest costs.
• Consider Debt Consolidation: Consolidating debts into one payment can simplify management and potentially lower interest rates.

Every payment reduces the weight of debt, bringing financial freedom closer.

5. Tracking Your Spending: Understand How to Monitor Your Spending Habits Effectively

Keeping tabs on where your money goes is essential for financial discipline. Here’s how to do it:

• Use Digital Tools: Apps like Expensify or Goodbudget can categorize and track your spending effortlessly.
• Monthly Reviews: Regularly review your spending habits to identify patterns and adjust your budget accordingly.
• Spot Areas for Improvement: Look for unnecessary expenses you can cut to better align with your financial goals.

Tracking spending is about gaining control and making informed choices.

By budgeting effectively, saving diligently, investing wisely, reducing debt, and tracking spending, you lay the foundation for a secure and prosperous financial future.

So, what steps will you take when your money hits your bank account? Remember, each decision holds the potential to unlock endless possibilities.

Take our free quiz and uncover whether you’re a Budget Boss, Freshman Investor, or Wealth Designer. It’s a great way to get personalized insights that can really help you on your financial journey!

Start the Quiz Now.

By Tom Butcher

How did you pay for your car?

Were you one of the lucky ones who could handover the exact cold, hard cash in full? Or were you like the 84.5% of drivers who used some type of finance to get their car?

Cars obviously don’t come cheap and buying one outright is out of financial reach for most people in the country thanks to sluggish wage growth.

There’s more to car finance than just your standard Hire Purchase agreements though.

Drivers are starting to discover other ways of getting access to a car though, besides just owning it outright. Leasing is one of these. While huge in the US and Germany, leasing is still a niche option in much in the world — but it is growing.

Leasing is often touted as being a cheaper solution to buying — but is there any truth behind the hype? I decided to do some digging and find out.

Leasing vs buying

First, let’s make sure we understand what we’re talking about.

Without stating the obvious, it’s probably a given that you know what I mean when I saying ‘buying’– becoming the legal owner of an item. When you become the owner of a car, you alone have the right to sell it and make it money from that sale.

Leasing is slightly different though and probably needs an explanation. Let’s turn to our old friend Wikipedia.

“Vehicle leasing is the leasing (or the use) of a motor vehicle for a fixed period of time at an agreed amount of money for the lease. It is commonly offered by dealers as an alternative to vehicle purchase but is widely used by businesses as a method of acquiring (or having the use of) vehicles for business, without the usually needed cash outlay.”

During the time you lease the car you won’t be the actual owner of the car, you’ll just be its registered keeper. You’ll be responsible for keeping it roadworthy but you won’t be able to sell it (so, you won’t be able to make any money from it).

The numbers

So, let’s look at the numbers behind this before we delve into the arguments. After all, comparing the evidence of both types of car finance is probably the only way we’re going to get a decent understanding of which is cheaper overall.

(Note: I’ve sourced all of the prices below online, and used real quotes to try and keep this as accurate as possible.)  

For argument’s sake, imagine two twin brothers: Matt and Francis. Both obsessed with the Audi A5. Matt decides to buy one and Francis decides to lease one. They’re both after exactly the same specification: a basic five-door hatchback with a two-litre engine.

Matt: the buyer

Matt can’t afford the £32,995 price tag of the basic Audi A5, but he wants to own it all the same. He decides to get some car finance and chooses a standard Hire Purchase agreement where he pays off the full value of the car in monthly installments.

Here are his terms:

• 35-month contract
• Paying £1,008 a month
• Initial deposit of £2,067
• 9.9% APR Representative

Market price of car: £32,995

Total paid back through HP: £37,340

Francis: the leaser

Francis can’t afford the £32,995 upfront either, so he decides to lease the car. He chooses a standard Personal Contract Hire agreement, where you effectively rent the vehicle for a period of time and then give it back.

Here are the terms:

• 35-month contract
• Paying £485 a month
• Initial payment of £1,455
• No APR

Market price of car: £32,995

Total paid back through PCH: £18,429

Next, I ran the type of car, the price of it and how long I’m going to wait until I’m the owner of it   through one of those car depreciation calculators you can find all over the internet.

Basically, the car will lose an average of 47% of its value in the time you’re in the agreement. That means that at the end of the period, it will be worth £17,627 – a loss in value of £15,368. Ouch.

So, here’s the takeaway if you haven’t really been following the numbers. In the above scenario, you’ll effectively lose £15,368 by buying a car rather than leasing.

Losses like that should make any person buying a car as an investment keep their hand on their wallet to be honest.

The expert view: The case for buying

So, after doing some research into the respective prices for leasing and buying an average family car, I decided to reach out to some experts in the field to find out what they thought about the leasing vs. buying debate, in terms of which was cheaper.

Let’s start with the case for buying.

Lou Carlozo sets out the pro-buying argument in this article for Money Under 30. In the article, he says:

“[W]e have to remind you that, financially, the best way to buy a car is to pay cash for something pre-owned to avoid paying both interest and off-the-lot depreciation.

“Another member of the Financial Literacy Commission, Clare Levison, notes that car payments will eventually end, whereas lease payments won’t until you turn in the car.  “With buying, eventually you will have paid the car off and no longer have the expense of the monthly payment.””

So that, in a nutshell, is the advantage of buying. You make your monthly payments until you’ve paid off the total and then the car is yours forever with no more payments to worry about. (Well, almost.)

The expert view: The case for leasing

So, why would you decide to choose leasing over buying?

Will Craig, CEO of LeaseFetcher, a car leasing comparison site, thinks that depreciation is a major reason why so many people are turning to this form of car finance.

“Buying isn’t all it’s cracked up to be. Depreciation means that cars will plummet in value in the first few years you own them.” he tells me. “That means you can find that your car is worth half of what you’ve paid for it when your finance agreement finishes– which isn’t a exciting prospect if you’re planning on breaking even when you end up selling the car.

“A car lease is probably one of the easiest ways to get your hands on a new, top-end car for a relatively small monthly payment, so it’s not surprising that so many people have been turning to it instead of buying.”

Conclusions

So, you can probably see from the figures and from the industry view, that leasing is seen to work out significantly cheaper than buying a lot of cases. The main reason for this is depreciation.

Unfortunately, cars aren’t like most investments that you make– they don’t hold their value particularly well. And that’s a polite understatement.

Cars lose value incredibly fast– literally as soon as you drive it off the forecourt, or it gets delivered on to your drive. The AA estimate that a car loses about 40% of its value in the first year of its life for instance, and that it continues to lose it whilst you’re owning it.

The important thing to bear in mind is that your monthly car finance repayments won’t be getting any smaller– unlike the value of your car. With car finance repayments, like HP or a loan, you’re effectively paying off the entire value of the car each month. With leasing, on the other hand, you’re only paying off the value that the car is expected to lose whilst you’re owning it. This means that it works out loads cheaper in the long run.

So in terms of whether leasing is ever cheaper than buying, I’d like to follow my freelance journalist nose, be balanced and say that both are the same, but that wouldn’t be true. In all honesty, the exact type of arrangement that’s best for you will depend on the type of person that you are– and personally, I think leasing is often a lot cheaper than buying.

a867a6ea5c34154b502c1ea6c1996b2a7ae9a1e1b54d7c5471

By: Joy Schoffler

Last summer I did something I have never done before, I took the summer off with my kids. A back packer in my previous life (e.g. pre-kids and pre-career) I traveled solo through SE Asia. While, my days of hostels and packed buses are long behind me, this summer taught me an amazing lesson. Traveling solo with kids is not only possible for parents but the rewards are many! The best part—if you travel to places where the cost of living is low and you play the airline card game, you can do so for less than the cost of many kid’s summer camps.

Use Airlines points to Buy  Tickets

After picking a location, I looked for the best days to travel with our airlines points. While we have flown to Hong Kong and Thailand using as little as 15,000 American Airlines points for each ticket, each way. I have been loving my SW Airlines card lately as they fly to a number of international locations for as little as 8,000 points each way.

Rent A House with Kitchen to Prepare Meals

My next step was booking a house. This is key as housing can be the most expensive part. We choose a condo in the beautiful beach community of San Juan del Sur (SJdS), Nicaragua. We choose a higher end condo at $1,800 a month—which was one of the bigger expenses of the trip. However, you can find housing for as little as $800 -1,000 a month in most parts of Nicaragua on a number of shared housing sites. We also made sure to book close enough where we could walk into town, to save on taxi expenses.

Renting a house, we had a full kitchen to prepare meals. With so many amazing fruits, veggies and fresh meats we were able to eat like kings for around $10-15 a day when we prepared meals at home. When exploring town we looked to see where the locals were eating. Not only was the food better, the prices were often half to a third less than the tourist places.

Connect with The People within The Community

Staying in one place allowed us to really connect with people within the community. Prior to traveling to SJdS, I joined an expat-mom’s group on Facebook. These amazing moms were beyond sweet, inviting us to a great 4th of July party, doing play dates and offering amazing advice. Strong expat communities often remind me of military communities. Something about living in a closed eco-system, especially over-seas breads a closeness and sense of community that is hard to find in the real world. The other cool part is we got to book tours with those people, turning surf and paddle-board lessons into opportunities to hang out with new friends.

Looking back on my adventure with my two children in tow, I am grateful most of all for the experiences money could not buy. While, the stereo-typical fighting that any siblings spending long periods of time together definitely occurred, they also became closer than they have ever been. Modern life, with its constant activity and necessity for childcare does not allow for summers together for siblings.

At this point in the article, many of you may be thinking—I would love to travel with my kids, but I have to work!

Plan Ahead and Reasearch for Better Deals

While, not every career will allow it, you may be surprised at your boss’s willingness to allow for remote work or a flexible schedule for a month or two—especially if summers are slow for your industry. As someone who was still working part-time through the vacation, I arranged surf-camps and had part-time help with the children. While, I did not end up using them I also located a day camp at an international school that had amazing activities for the kids for ½ the cost I would have paid for a US camp.

Create a Passive Income Streams

I additionally set a few investments in motion to allow for passive income streams to come in while I was away. Upside Avenue is the one that I use but there are many options to slowly start building cash-flow.

If a summer is not do-able spending a Christmas over-seas is one of the most amazing gifts you can give your kids.

For the last few years my family and I have skipped the presents and holiday parties and opted for international travel. Using points we typically ended up spending little more than we would have for the typically Greswald style Christmas’s that used to be a staple of our holidays. One of the other perks of holiday is my husband and I often lose weight instead of packing on the holiday pounds.

The point is where there is a will there is often a way. Travel with children, even solo-travel if one parent cannot make it is possible if you set the goal and work towards it!

P.S. At the time of writing the article Nicaragua was very peaceful. Unfortunately, it has since had some political unrest. With that said there are countless destinations around the globe where your dollar can go far and you can make life-long memories for less than the cost of summer camp!

By America Saves

We all like to know we’ve brightened the day of someone we love and care for. Choosing to spend a little extra money on a gift for someone special may seem like it’s worth it right now, but if you have to deviate from your budget, then it might not be the best idea in the long-run.

Luckily, there’s plenty of ways to give something that’s sure to be appreciated while also staying within your budget. We’ve compiled a few ideas to help you do just that!

Give ‘em some coupons 

No, not the ones sent out with the newspaper for toilet paper, kitchen appliances, and the like. Make your own coupon booklet of things the recipient can redeem whenever. If it’s for an immediate family member or roommate, make a few coupons volunteering yourself to do the chores you know they like to do the least, such as mowing the lawn or dusting the house from top to bottom. If it’s for a friend or significant other, make one for a home-cooked meal where they pick the menu and you do the cooking. Get creative and brainstorm quality time activities and favors, write them up on some cardstock, and assemble into a flipbook.

DIY personalized cookbook

For the chef, baker, or mixologist in your life, compile recipes you think they’d like or family favorites. If they have a favorite food of all time, you could do a section specific for that – or even make the entire book just recipes with whatever their guilty pleasure is.

Give the gift of music

It could be a playlist of their favorite songs, music you think they’d like based on their tastes, or songs significant to your relationship with them. If you happen to have the gift of making music yourself, whether singing or playing an instrument, consider making a few recordings of yourself. Parents who have funded any or all of your musical endeavors might be particularly appreciative of that twist!

Gifts in a jar

The possibilities are endless with this idea. Whatever their hobby might be, whether it’s crafting or drawing or baking or something else entirely, gather up some small items that relate to it and put them in a jar. Finish it off with some decorative touches, and voilà! The Gunny Sack has some additional ideas for potential themes for your jar gift.

For the reader in your life… 

You can never go wrong with gifting them a book in an area of interest to them. However, books aren’t necessarily the cheapest purchase. A more budget-friendly idea is to compile a “Must Read” list of either your favorite books or the results of some searching for new reads you think they might like. Or, you could even coordinate a book swap of one of your favorites with one of theirs! 

A little thoughtfulness goes a long way in conveying your care for someone this holiday season–and toward keeping your budget intact!

By America Saves

The holidays are quickly approaching, and with the glitter and glam can come stress, anxiety, and impulse. As Benjamin Franklin said, “Failing to plan is planning to fail.” Consider using some of these tips to keep from being overwhelmed, overworked, and overspent!

Set and stick to a budget

Think about what you can truly afford to spend, while still paying your regular expenses and contributing to savings goals. Don’t stop working towards your long-term plans just to satisfy temporary holiday gift-giving urges!

Bonus tip: Do a post-holiday reflection. Review your spending and really explore if there is anything you could do differently for the next holiday season.

Gifts

Before the holidays, have conversations with friends and family about gifts. Do you have large groups that you typically buy for? Consider drawing names instead of having to give to each person. Most importantly, avoid turning gift giving into a competition. It’s easy to compete with yourself, family, and friends. Take a breath and remember that sometimes the most meaningful gifts don’t cost a lot and don’t even have to be a “thing,” but rather an experience.

Listen up!

When talking with friends and family, listen to what they say. Pick up on those cues for what they like, and more importantly, what they don’t like. Make a mental note, or even better, put it in your phone or write it down. This will be handy when it comes time to gift buying, and can keep you from grabbing impulsive and budget-busting gifts.

Make a list, and check it twice

Sounds cliché, right? But making a list keeps you on track. Whether in your wallet, your purse, or your smartphone, keep it where you would most use it. Consider using an app on your phone for tracking. Having an easily accessible list will allow you to keep all your holiday planning on track, from gifts to grub and everything in between.

Set it and forget it

Consider setting expenses and savings to auto-pay. Life is already busy, and we’re being pulled in different directions more than ever before. Free up some mental bandwidth by automating your finances. We can forget due dates, which can create all sorts of costly headaches-termination of service, late fees, interest charges, and reconnection fees. Avoid these by enrolling in auto-pay. You can also set up email and text alerts to be sent before your due date to help manage those bills.

Save time, too

Too often we think about our budget in only dollars and cents. It’s also important to think about your personal time and how you assign value to that time. Consider stacking errands to save time, money, fuel, and energy. Use a map app to lay out your errands in the most efficient way. Consider teaming up with a friend or family member for an errand date. This is something we love and can attest to its immense benefits.

Take care of YOU!

It’s critical to get enough rest. Study after study has shown us when we’re feeling fatigued, we don’t make the best financial decisions. Taking care of your health should be at the top of any holiday to-do list. Make sure to stay hydrated and full. When we get busy, it can be easy to skip a meal or grab something at the nearest convenience store. Those costs can add up. Save money and calories by packing a healthy snack and drink to have with you while running errands.

Guard yourself!

The holidays are prime time for food, fun, and the unfortunate holiday theft. Protect yourself before going out to those holiday parties or braving the crowds at the local mall.

• We tend to keep a lot of financial information on our mobile phones. Make sure it’s password protected; know how to locate it if it’s missing, and how to remotely wipe the device if it’s unrecoverable.
• Carrying around a lot of reward and membership cards on your key ring or in your wallet? Forgetting the cards when you need them? Consider lightening your load by moving them to an app on your smartphone.
• Check your bank accounts frequently, and report any suspicious activity immediately.
• Consider using a mobile payment service on your phone for added security and efficiency. Read more about the benefits of digital wallets here.
• Traveling out of your normal spending area? Notify your credit card company to avoid the freezing of your card due to charges in unfamiliar areas.
• Lastly, keep only what’s truly necessary in your wallet. Don’t carry every card you have. This will help minimize the potential for loss and headache that comes with a lost or stolen wallet, along with reducing the temptation to use all of the cards.

By American Saves

According to the National Retail Federation’s recent survey, more than 164 million Americans plan to shop over Thanksgiving weekend and Cyber Monday. And of those, a whopping 20 percent plan to shop on Thanksgiving Day.

When asked what they enjoy the most about shopping during the holidays, over a third said “it is a family tradition” while 23 percent said they most enjoy holiday decorations and displays; nearly as many cited finding the perfect gift for someone.

Before you rush to the stores in-person or online to shop, like so many Americans this season, take a moment to stop and think. After all, the real meaning behind the holiday season shouldn’t be how many gifts you give or how expensive they are, but spending time with family and friends while celebrating traditions.

Keep your finances under control with these four simple holiday spending (and saving) tips:

1. Don’t shop without first creating a sensible holiday spending plan. Make your list, check it twice and then decide a reasonable budget to work with. Check out this Free Holiday Budget Printable.  If you’re worried that you’re overspending, here are some signs you could be spending too much this holiday and some strategies to help you stop.

2. Do set reasonable expectations this holiday season for yourself and family. It will save your wallet and sanity from credit card bills that come after the holidays are over. Be upfront and honest with your family about your budget. Remember that gifts don’t have to be expensive to be thoughtful. Consider setting gift spending limits with your family, or pulling names out of a hat and only gifting to one person.

3. Consider other ways to give. Small acts of kindness, especially during the busy holiday season, go a long way and are priceless. Bake up some holiday treats, put them in a pretty box with a bow and you can easily knock some names off your gift list. Consider making your own unique presents for loved ones. Some of the best gifts I’ve ever received were the ones made especially for me. Better yet, give the gift of time. Instead of opting to give gifts this year, suggest to family members that you should all get together and volunteer for a cause.

4. Give yourself a gift–SAVE that bonus! Don’t forget to give to yourself this holiday season. While it may be tempting to buy that sweater you’ve been eyeing since it is “such a good deal,” consider saving that money instead. Get a holiday bonus from work? Save it instead of spending it. You’ll feel much better going into the New Year with little or no debt, and better yet—a growing savings account. If you don’t know where to start, Finances Demystified can help. Learn how to get started here and make a plan today.

Before you buy into the insanity of holiday consumerism, ask yourself what brings you and your family the most joy during the holidays? Spending aimlessly or spending time together? Find joy and focus on giving the gift of your time this holiday season.

This is a sponsored post curated by me on behalf of Relay^®. All opinions are 100% mine!

Budgeting…yes I know, some people might think it’s boring. But I think budgeting is exciting, because it puts you in charge of exactly where you want your money to go.

Speaking of being in control of your money, when was the last time you got rewarded for your planned spending? I am not talking about some of those credit cards that give you 1% cash back and then charge you 25% in interest and hundreds in fees. I’m talking about a time when you were in control of your finances, planned ahead, stuck to your budget and got a financial reward for it.

If you’re like me, you’re probably having a hard time thinking of an instance like this. Honestly, even with my financial background, I never heard of anything that rewarded you for planning ahead, budgeting and doing your usual everyday spending, until I recently heard about Relay^®.

 So, let me tell you how you can get rewarded for your regular spending habits with incredible cash-back. The formula is pretty simple:

Make Plan + Work Plan = Earn Cash-Back

Relay^® is a totally new financial product, designed for smart spenders and planners, which combines an immediate annuity (without typical surrender fees or penalties if funds need to be withdrawn) with a prepaid debit card. Let’s say that you have some home improvement expenses you’re planning for, and you have a set amount put aside for them. You can drop that amount in a traditional checking account and earn maybe .01%. Or you can use the funds to open a Relay^® account, receive a set amount from the account monthly for the things you plan to buy AND receive incredible cash-back as they spend! This is pretty cool, as it provides you the opportunity to earn cash-back on money that would otherwise just be sitting in an account until it’s spent, earning little, to no money.

This spending can be applied to so many things, such as a big travel budget, or recurring monthly expenses like cable and cell phone bills or even practical, day-to-day expenses like on groceries, gas and clothing or whatever your little heart desires! I wish this was around when I was preparing to travel full-time. Relay^® would have been the perfect tool – I would have deposited the money I had set aside for my adventures, then the money I needed would have been put on my prepaid debit card each month – and I would have earned cash-back on every dollar I spent!

If you are over low interest rates and ready to finally reap the rewards of your financial discipline by earning competitive cash-back of 3-13% each year (depending on the length of the plan chosen), with no merchant restrictions, penalties, blackout dates or annual fees, then Relay^® may be for you! Just check out their website for all the information.

Relay^® is currently available to residents in Florida, Illinois, Indiana, Massachusetts, New Jersey and Texas, with service expanding to California soon, and additional state expansion planned for the coming months.

To learn more about Relay^®, follow along on their social channels.

• Facebook (@Relayrewards): https://www.facebook.com/Relayrrewards
• Twitter (@Relayrewards): https://twitter.com/Relayrewards
• Instagram (@Relayrewards): https://www.instagram.com/Relayrewards

[Footer (disclosure)] Relay offers an immediate annuity, form number GLA-SPIA-RL-01 or a variation of such, issued by Guggenheim Life and Annuity Company (d/b/a Guggenheim Life and Annuity Insurance Company in California; NAIC#83607) (“Guggenheim Life”), a Delaware-domiciled insurance company with its principal office in Indianapolis, Indiana. Relay and/or certain features may not be available in all states. Guggenheim Life is currently licensed and authorized to do business in 49 states (all states except New York), the District of Columbia and Puerto Rico.