Supposedly Sane

Here are some financial tips I religiously follow that make my life so much easier and have helped me save and get into healthy financial habits. You might not think this is important now, but getting into good habits at a young age will help you save and get a great credit rating that will benefit you in the future.

• Mint.com. Mint is basically  a safe, free way to manage EVERYTHING. Bank accounts, student loans, credit cards, budgets, etc. You give Mint all your login ID’s and passwords and it check automatically checks your balances, payments, and bank transactions. It categorizes all of them and sends you weekly emails on how you are doing with your budget! Example, if you only want to spend $100 a month on restaurants and groceries, it monitors what your spending on and sends you a weekly update. It also sends you an email if you’ve gone over budget!  Here’s a screenshot of mine:

• Establish credit. So many people have so many misconceptions about their credit. Like credit cards are a bad thing, paying late a few times doesn’t make a difference, and that you don’t need to establish credit when you’re young. These are all so far from the truth! Credit cards are the best way to establish credit if you don’t have loans. Even if you don’t use it, on your credit it looks like you have a credit card that you pay off every month because there is no balance. Just make sure you’re responsible! If you do use it, pay it off every month if you can. Get a card from American Express that gives you great rewards. I recommend the Clear Card from American Express. It has no fees, and you get an automatic 1% cash back. They mail you a $25 gift card you can use anywhere once you spend $2,500. It’s free money! Also, never say to yourself “I’ll spend this because I get paid next week.” IF YOU DON’T HAVE ENOUGH MONEY TO PAY IT OFF, DON’T BUY IT!

• Two separate banks. I use Charles Schwab for my investor’s checking account and have my paycheck deposited there biweekly. I also have an HSBC online savings account. You might ask, “Why the heck do you have 2 banks?” Well I noticed when I had both at the same bank,it was also too easy to transfer money from my savings into my checking when I needed it. It NEEDS to be inconvenient! Since it takes time to transfer money back and forth, it’s helped me save several thousand dollars that I otherwise would’ve spent when my checking account balance was getting low!

• Shop interest rates. I am totally guilty of having crappy interest rates and not knowing it! My savings account for 5 years had 0% interest! I was earning NOTHING on that money. I went to www.Bankrate.com and found a better rate. Now I’m earning 1% on my checking at Charles Schwab and 1.85% with my HSBC online savings account. Why stay at a bank that isn’t working for you? Also look around for ways to save. Charles Schwab reimburses me for any ATM fees and so does HSBC. For you habitual ATM uses, that could be $20 a month = $240 a year!

• Small savings! Every Friday I have $25 automatically transferred out of my checking account into my savings. It’s a small enough amount that it won’t ever overdraft my account. I usually don’t even notice it. It is a large enough amount of money that over time it adds up. That $25 a week into my savings adds up to $1,300 a year that I normally wouldn’t have saved. I do this in addition to sporadic transfers when I have extra money. It will really help you save!

• Automatic Credit Card payments. I don’t like putting things on automatic payment because I don’t typically keep a high balance in my checking account. The down side of this is if you don’t pay on your credit card due date, you get a late fee. Most companies don’t even have a 1 day grace period! So what I’ve done is since I usually pay of my entire credit card balance every month, I have an automatic payment set up with the CC company but for the minimum payment only. If you pay ahead of time, your minimum payment is $0 so usually no payment will come out automatically. If you forget, that minimum payment will come out and avoid the late charge! Since credit cards are always due on different days of the month, this is a really nice way to never ever get a late charge.

• Always pay 1 month ahead on your bills. I’ve made it a habit to always try to pay 1 month ahead on things. I’m a freak about this because I talk to so many people with messed up credit that it’s made me a stickler! When I get my first bill for something that’s always the same amount (for example a cell phone bill) I pay twice as much, and then to continue to pay the normal amount every month when I get the bill even though it says $0 due. Then at the end of your contract you can just not pay the last bill. I do this in case I ever forget to pay a bill so it won’t affect my credit or my standing with that company. It’s a really good way to avoid late charges, credit delinquencies, and it will also prevent you from getting stressed thinking, “did I pay that bill?” and you can’t remember!

• Shop at Giant Eagle. I buy all my groceries at Giant Eagle, use my Giant Eagle card, then fill up my gas tank afterwards! I always get at least .40/gallon off on gas. I know Giant Eagle is a little more expensive than some stores on certain items, but because I buy about $50 in groceries every 2 weeks… it’s not more than a big difference. I’m saving WAY MORE by shopping there and savings on my gas so it all equates to being beneficial.  Plus they recently rolled out a program that you get grocery savings for buying gas! It’s mutually beneficial.

• Monitor your credit. Most people don’t know this, but the government made it mandatory that EVERYONE can get their credit report once a year for free. Go to www.AnnualCreditReport.com to get yours, no strings attached, from all 3 bureaus. You  have to pay to get your score, but a report is still good to have. You can see if there is anything on your credit report that doesn’t belong, and see if there are any delinquencies. If you do, even more incentive to rebuild your credit by opening a credit card, disputing the delinquency, or just START PAYING ON TIME!

I hope these helped, let me know if you have any other ideas, or if you liked these ones! I might start making this a monthly blog :)