Tips to Reduce Spending

by | Jan 30, 2015

"Oh where does all my money go?"

“Oh where does all my money go?”

Do you need help managing your finances so that your family can realize more of their needs and wants?  Family members of all ages must learn to communicate and understand what their financial situation is.  Open discussions among family members often results in greater cooperation when deciding what the best things upon which to spend. Family members need to understand the difference between a need and a want.  Then an open discussion can set priorities for the money available.

Your family may decide to reduce spending so that more needs and wants of each family member can be made.  Here are a few suggestions:

  • Categorize your expenses in two categories: wants and needs. Make everyone aware of the difference and how important it is to consider each purchase through this categorization.   Needs include housing, basic utilities, childcare, etc.  Wants could include going out to eat, high fashion, newest electronics, etc.  Everyone has to understand that a want purchase can be spaced over time.
  • Do not let your impulse determine purchases. Postpone unplanned purchases at least 24 hours so you can rethink your plan.
  • Before purchasing an item, ask yourself, “Why?” Many people are now wearing a plastic bracelet that reads “Do I really need this?”  It helps them make decisions based on wants and needs.
  • Save on food by planning meals with abundant seasonal items and based on supermarket specials. Check the store ads and utilize coupons to buy what is on your list but don’t let the coupon result in your buying items you would not buy without a coupon.  Make a list before going to the supermarket and then work your list.
  • If you have debts, accelerate repayment. There is little reason to retain savings that earn 3% interest while you still owe installment debts and loans that carry true interest rates of 12%-22%. Yes, everyone needs an emergency fund but after it is secured, repay your loans.

 

Want additional suggestions on how to cut expenses and save money?  Go to www.edis.ifas.ufl.edu and request the bulletin FCS7009.

 

Evaluate Your Need for Life Insurance

by | Jul 30, 2013

Evaluate your life insurance needs if you have children.

Evaluate your life insurance needs if you have children.

Life insurance is protection against the loss of income that would result if the insured passed away. According to Life Insurance and Market Research Association International (LIMRA), approximately 35 million households are uninsured and 50 million American have inadequate life insurance. September is national life insurance awareness month, but the time to start preparing is now. Take the first step and consider whether you need life insurance.

“The top two reasons people don’t buy life insurance are: competing financial priorities or because they think they cannot afford it,” (LIMRA, 2012). How do you know if you should give life insurance serious consideration  or rethink whether you have enough? If one or more of the following situations apply to you or your family you may want to evaluate your need for life insurance:

  •         If you have children and both parents work
  •         If you have children and one parent works
  •         If you have children and you cannot afford to pay for their final expenses
  •         If you are a single parent
  •         If you have an outstanding shared debt
  •         If you are married and your spouse could not support your current lifestyle without your help
  •         If you are married and your spouse may have to care for one or more elderly parents

The above list is not exhaustive, but is meant to get you started thinking about the kinds of family or lifestyle situations when life insurance could benefit you in providing for your love one(s).  For more research based information on life insurance you may want to read Understanding Life Insurance (http://web.aces.uiuc.edu/vista/pdf_pubs/LIFEINS.PDF) by University of Illinois Extension. Remember, family conversations about money can be difficult.  “Can We Talk? Improving Couples’ Communications” (http://edis.ifas.ufl.edu/fy044) is a great refresher on effective communication before tackling a delicate topic like money.