Over at the Simple Dollar, a recent post about the intriguing notion of wallet fasting made a lot of sense. “Wallet fasting” is a habit that many people who are not quite in control of their finances have - when they notice they have a spending problem or are getting too deep into debt, they simply go on a spending “fast” and cut out every non-necessity. They just don’t open their wallet.

And while this might have a positive effect on finances in the short-term, it’s not a long term solution. What usually happens is that as soon as the bank balance looks a bit better, people start to spend money again - “just once” - and soon they’re back into their old spending habits again. Nothing has changed.

If this sounds like you, then sit down and take note. Spending habits will only change if you put some serious consideration into what’s going wrong with your spending pattern and how you can change that in a meaningful and permanent way. It’s one of those things that makes perfect sense but is sometimes hard to do - but definitely worth the effort. If you’re in the habit of “wallet fasting” then make a resolution to change the habit properly and only then will you start to see some significant change.

As you know the economy is on a downturn, the stock market is anything but stable, and real estate prices are dipping. If you are not worried about money you are in the minority. With so much going on around you it is important to keep one thing in mind: now is the time to save. By saving now you can protect yourself against future problems. It may not be fun to save all your money, and you don’t have to stock away every last dollar. But you definitely need to build your emergency fund/savings to ensure that you could get by should something bad happen to you or your finances.

There is no denying that it can be difficult to save. In fact, some people don’t have any money leftover at the end of the month; or so they think. No matter your financial situation you should look for a way to save each month. This does not mean you have to save thousands. Anything is better than nothing, and once you get on a roll you will see just how beneficial this can be.

Where are you going to save your money? Many people have money to save but don’t know where to put it due to the bad economy. Obviously, investing in the stock market is not the best idea for everybody at this point. If you are building an emergency fund you want to keep your money as liquid as possible. For this reason, the best place to save is in a high yield online savings account. This allows you to not only save but to also earn interest.

No matter who you are or what position you are in now is the time to save. The more you save each month the better. Keep this in mind when setting and managing your budget.

You might think that all real estate prices have done lately is fall, and fall some more. But the end of year statistics say otherwise: in every corner of the United States there are areas where real estate values fell but also some where the values stayed the same or even rose.

Here are a few examples that might get you thinking about where you might want - or not want - to invest in real estate in the coming year:

• California: The vineyard city of Soledad soared during the boom and came down with a thumping crash, with real estate values falling nearly 40% there during 2008. On the other hand, technology-loving Palo Alto saw homes increase in value about 4% - not bad at all.
• Georgia: Gainesville didn’t have gains at all in 2008: this northeast Georgian city saw real estate prices slump by over 20%. But in the same state, a suburb of Augusta called Martinez had prices rise over 4%.
• Alabama: Things weren’t too bad anywhere in Alabama, with the worst real estate record of 2008 going to Alabaster - but this fall in value was just over 2%. In Montgomery, home values rose more than 5% for the year.
• Arkansas: On the other hand, everybody lost out in Arizona during 2008. In Springdale, homeowners saw the value of their properties fall on average more than 27%, and the best performance was in Sierra Vista where prices still fell, but by just over 4%.

Relying on two incomes is much easier than relying on one; there is no doubt about this. And while some couples voluntarily cut out one income others are forced into this. If you are in the latter group what are you going to do to make ends meet? With the unemployment rate increasing more and more families are being forced to live on one income. While this is never easy there are some tips you can follow: (more…)

What is the status of your emergency fund? There are a few common answers to this question. Some people have enough money in their emergency fund, some are working to save more, and others don’t know what this is. As you can imagine, the best position is to have plenty of money in your emergency fund. The worst position is to have no money saved.

How much money should you keep in an emergency fund? This all depends on your situation. Many experts say that you need to have at least six months worth of living expenses in this fund. Will this work for you? Some may want more, some may want less. Either way, you need to know what you are comfortable with and then do your best to reach this goal.

If you don’t have an emergency fund now is the time to start saving. You never know when something is going to come up that will call for a lot of money over a relatively short period of time. For instance, what would you do if you lost your job? While this is never good, if you have an emergency fund you at least have money to fall back on until you find a new job.

Where should you keep your emergency fund? You want to make sure that this money is liquid. The best place to keep an emergency fund is in a checking or savings account. To make the most of it look for an online savings account that allows you to earn a good return on your money.

So what is the status of your emergency fund? If you don’t know the answer to this question there is a good chance that you are running behind. Do yourself a favor and sure up your emergency fund as soon as possible. This is not a decision you will regret.

College costs have been a heavy financial burden for many in the United States for a long time now, but some scary statistics are making it sound like it could get a whole lot worse. (more…)

It shouldn’t matter what the economic situation is - it always pays to try to be smart about shopping whether you’re looking for clothes, electronics or anything else. And being smart includes:

• Doing your research - know how much you should expect to pay and set a budget.
• Checking online - it’s often cheaper to buy a product online than in a physical shop. If you prefer to buy in person, at least do some price comparison online to find out which shop will provide the best price.
• Looking out for cashback offers - they’re coming thick and fast now to encourage you to buy new products so make sure you take advantage of them - and check the fineprint before you buy to be sure you’re eligible.
• Keeping an eye on loyalty schemes - and calculate whether it’s worth buying something at a particular shop, if the reward is high enough from the loyalty scheme; but don’t be so loyal that you miss out on much cheaper prices elsewhere.
• Asking for a discount - especially if you can prove you’ve seen the same product at a lower price elsewhere, or if the product was a display model or is slightly damaged.

In today’s day and age a lot of people are scared of investing money in the stock market. The market is anything but stable at this time, and this is forcing many people into other investments. While you don’t want to take all of your money out of the stock market you do need to consider which investments are safer. This is particularly true if you are nearing retirement age and will need to access your money in the near future.

There are several safe investments that you can consider. First and foremost, if you want to keep your money safe, while still receiving a decent return, you should consider opening an online savings account. Many online banks offer rates as high as 3.75 percent, and as the economy improves this number will probably increase. Why an online bank? If you compare the rates at online banks to a local institution you will see just how much better off you and your money will be online.

CD’s are also great safe investment vehicles. Generally speaking, with a CD you are locking your money up for a predetermined amount of time at a predetermined interest rate. For instance, you can purchase a CD for six months with an interest rate of four percent. If you know that you will not need your money until the CD matures this is a great way to earn a decent return without taking a huge risk.

You don’t have to keep all of your money in “safe investments.” But you should definitely keep some of it in places where you are guaranteed a return. After all, it is better to make money than to lose it, right?

Now might be a terrible time to sell your home, but what many people haven’t yet thought of is that it’s actually a great time to renovate your home.

For a start, the costs of many materials needed in renovation jobs has fallen. This is particularly true for exterior projects like replacing your roof or repaving the driveway.

On top of that, the fees being charged by contractors are falling as they fight for the fewer jobs available. Apparently most will discount their fees by at least ten per cent just for the asking, and many by more.

And while the experts are saying that it will now take a little longer before you can recoup the entire value of your renovation in selling your home, as long as you’re not planning on selling immediately you’ll still be winning by enjoying the many benefits of renovations. A smart one at the moment is replacing windows, a project which is high on the list of improvements whose value is quickly recouped and at the same time, will save you money on heating and cooling costs.

Other home renovation projects that the experts recommend right now include remodeling your bathroom and either a minor or major kitchen remodel. Replacing your siding is also a cost-effective move to make at the moment.

Have you waited too long to complete your Christmas shopping? If so, you may have missed out on a lot of the best deals and are now up against the wall. Even though you may be running out of time it is important that you keep your cool and stick to your budget. Believe it or not, you can save on Christmas gifts no matter when you head to the store.

The best way to save is to have a list and a budget, and then shop around to find the best deal. Of course, if you don’t have a lot of time you may not be able to shop around as much as you would like. But at the very least you should check out at least two stores before making a decision. For instance, if you are buying a GPS system it is a good idea to not only compare stores but to also compare models. You may find out soon enough that you can save money by purchasing a specific model from a specific store.

Most stores have sales leading up to Christmas, as well as the days following. By keeping your eyes open you will know where to turn for the best deals. Not only do stores run commercials during the holiday season, but you will receive ads in the mail while also coming across online sales. If you are constantly on the lookout for good deals you can save money no matter what day you decide to shop; even if it is Christmas Eve.

It is never a good idea to wait until the last minute to shop for Christmas gifts. But if you find yourself in this position it is important to realize that you can still save money.