ICFE eNEWS #16-01 - January 4th 2016
Did You Overspend on Christmas and the Holidays?
What a way to have to greet a new year;
facing a mountain of credit card statements within weeks of
Christmas. The sad lament of more than a few consumers is: Now
what do I do? First things first, rein in the spending by making
it harder for you to spend.
There are ten initial steps
to take immediately to begin the turn-around.
Freeze credit cards and ATM cards in
a glass of water in your refrigerator freezer.
Get spending on a cash basis and make
notes/keep receipts on all purchases to help raise your
awareness of where your money is going, day in and day out.
Freeze your credit files. This is now
available in all 50 states. Freezing credit files will make
it more time consuming to open new credit accounts or make
large credit-based purchases. In the process you will be
sent a copy of your credit files.
Take some financial pictures of
yourself. The big picture is your net worth, listing the
things you own versus the things you owe. But don't stop
there, determine how many years you have been working
full-time and how much money you have earned during that
time. Now, what percentage of your lifetime income (to date)
is reflected in your net worth? 10%? 20%? 50%? 150%? The
close-up picture is your cash-flow, how money moves in and
out of your life on a monthly basis. It is a list of all
income received in a month and also a list of all expenses
during the same month. The difference in the two amounts
equals your cash flow, be it positive (more income than
expenses), or be it negative (more expenses than income), or
be it zero (monthly income and expenses are equal). The
close-up picture will help in prioritizing monthly spending.
The cash-flow will also help identify spending that may be
hurtful to getting out of debt. Try to get as much extra
cash going to debt pay-down as possible.
Create a written spending-plan and
implement it with the next paycheck or the first of the
month, whichever comes first. The cash-flow exercise is the
basis for the spending-plan; all the leg-work is done. The
monthly spending-plans then become your financial roadmap.
The key is to follow it closely, because within that
spending plan will be the Christmas debt reduction and,
eventually overall debt elimination. Printable one page
spending plans are on icfe.info.
Look for ways to get a better value
for your dollar. It may mean doing things for yourself that
you may have paid others to do for you, such as lawn care,
car washes, laundry, and so forth. Comparison shopping is
another way to save money and get more value. Coupons and
rebates add value to your dollar, especially at the grocery
store where the average American family spends 30 cents of
every take-home dollar.
Make it a family affair. Everyone can
contribute to energy savings, avoiding food waste, clipping
coupons and watching out for sales on things regularly
purchased. Everyone can become a comparison shopper and look
for better values. An over-spender is not just someone who
spends more than they earn, an over-spender is also someone
who pays too much for things and the latter group is the
Add to your income at the same time
you are spending smarter. This can be done by taking
part-time employment, selling things on the internet with
eBay, for instance, perhaps generating additional income
from a hobby, craft, music or language instruction, and
tutoring, to mention a few.
Get some visual reminders around your
home and office about improving spending. If ATM and some
credit cards must be unfrozen, then keep those cards
protected in an "ICFE Credit Card Sleeve.". View them here
Take the inter-active spending quiz
here on ICFE.info. There are two; one for looking at your
spender's profile and the other is an over-spenders quiz.
They both will help anyone gain some insight to their
spending Practices and habits.
Good luck and Happy 2016.
eNEWS is available FREE upon request by visiting our Web site
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this eNEWS on to your peers and interested others and invite
Also, visit the ICFE's new Web site: StudentDebtHelp.org
Paul S. Richard
President - Executive
Institute of Consumer Financial Education (ICFE)
About the ICFE:
The Institute of Consumer Financial Education (ICFE) was founded in 1982 by the late Loren Dunton (creator of the Certified Financial Planner (CFP) designation). The ICFE is dedicated to helping consumers of all ages to improve their spending, increase savings and use credit more wisely.
The ICFE is an award winning, nonprofit, consumer education organization that has helped millions of people through its education programs and Resources. It publishes the Do-It-Yourself Credit File correction Guide, which is updated annually. The ICFE has distributed over one million Credit/Debit Card Warning Labels and Credit/Debit Card Sleeves world wide.
The ICFE became an official partner with the Department of Defense/Financial Readiness Campaign in June of 2004.The ICFE was an active partner in the California Student Debt Resource Awareness Project (CASDRAP) which resulted in a new web site: (studentdebthelp.org). CASDRAP disbanded in 2010, shortly after the web site project was completed. In 2011 the ICFE assumed the single sponsorship of the (studentdebthelp.org) web site and is now responsible for its content and operation.
The ICFE is also an on-line help for consumers who spend too much. ICFE's spending help was featured in PARADE Magazine in the Intelligence Report section. The money helps and tips are from the ICFE's Money Instruction Book, our course in personal finance.
Visit the ICFE's other web sites at: www.financial-education-icfe.org and studentdebthelp.org. Both sites helps consumers and students with mending spending, learning about the proper use of credit, budget and expense guidelines, how to set up and implement a spending-plan and also how to access financial education courses and how to teach children about money. Other ICFE services include: Ask Mr. G, a free eNews, and an online resource center for students, parents and educators, plus financial education learning tools and a book store.