Have you taken the time to create a budget based on the amount of time you have available? We’ve all heard that time is money and yet most of us are quick to count pennies while paying little or no attention to the seconds that fly by. Unlike money, however, there is no way to store time to use at a later date. There are  no credit cards issued to use when you need 190 hours in your week instead of the usual 168.

So how do you go about making a time budget? You use the same format that you should already be using to track your financial income and expenses. Figure out approximate times for each major task you complete during a specific week. The hours you typically work, your drive times, shopping, laundry, etc. Be realistic in your estimations and don’t cut down times just to make yourself feel better about how you spend your time. Just like you’d bring some extra money to a grocery store if you knew prices changed constantly and you had a list of things to buy, make sure you leave enough margin between your tasks.

Once you have your time budget laid out, its time to see where you are wasting time and congratulate yourself for the days you use your time effectively. Setting up a time budget is a great exercise to gain a new perspective on how you are spending your life. Unlike the financial playing field, the one of time is exactly level for us all. The most financially wealthy people in the world woke up this morning…and started the day with exactly the same amount of time left as you did.

Have you made a time budget?

photo credit: Michel Filio

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So you’ve blown the budget, spent more than you could really afford, or life’s changing circumstances mean that you’ve accumulated more debt than you want to deal with. Sometimes it might feel like a pit that you can’t get out of, but here are three basic steps to get you back on your way to financial success: (more…)

As mortgage payments grow increasing unmanageable and credit card balances don’t seem to get any lower, Americans have been cutting budgets, making sacrifices, and developing creative solutions to their personal finance woes. But if you’ve considered borrowing against your 401K, you might want to rethink that decision.

The IRS views hardship withdrawals from a 401K account before the age of 59 1/2 as income, and the money is taxed as such. Furthermore, all funds are subject to a 10% penalty. These two factors combine to create several consequences. To begin, taking money out of your 401K will obviously reduce your retirement savings. Even though retirement may seem like a distant future event, you may be surprised at how difficult it is to refund your account while continuing to grow your savings. Beware that your emergency withdrawals don’t bump you into a higher tax bracket, as well — the taxes alone could cancel the benefit of your extra income.

Even if your withdrawal isn’t considered a hardship loan, experts say that taking money out of your 401K may run you the risk of not being able to support your lifestyle during retirement. In fact, experts say that based on current savings statistics, 43% of savers are in danger of living a simpler lifestyle when they reach retirement age. It’s a difficult task to pay back a loan while continuing to pay into your retirement savings.

Though budgets are tight and temptation is high, resist your urge to withdraw from your 401K account. Instead, consider alternatives like selling your car and buying used, eating at home more often, and turning your lights off when you leave a room. When age 65 rolls around, you’ll thank yourself.

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