Budget, Credit Cards, Debt, Gift Giving, Saving, Spending
December 14, 2012
Whenever you feel fear about spending money that should be a sign that you're spending money you don't have to possibly even impress people you don't even know or like.
Always remember the holiday season is about giving. True giving is giving joy is giving time is giving appreciation showing true love for others.
If you are buying something for somebody and you have to put it on your 21% credit card and you can only pay the minimum payment due every time the bill comes in here is what I want you to get. Chances are the person that you're giving the gift to won't even remember what you gave them next year but yet you'll still be paying for that gift for the next 5 to 10 years or more.
Also if you do buy a gift and have to put it on your credit card at 21% interest and can only pay the minimum payment due every month when the bill comes in by the time you have really paid for that gift it could cost you triple. So If you're buying a $50 sweater look at that sweater and know in your situation it's going to cost you $150 because in fact it could. Is it really worth it.
Also here's the big thing that you really need to understand. If you don't have money and you're buying a gift for somebody chances are they don't have money either. If you give them a gift they're going to feel obligated to give you a gift back. Now you're both going to have to put those gifts on your credit cards and you're both going to be spending money that really neither of you can afford it. So you have to remember a gift a true gift is not only a gift fir the person that you're giving it but it's a gift to yourself as well. Gifts you can't afford will never be a true gift to yourself.
Now try this. Go up to people and simply asked them what were you given last year for Christmas. Watch the look on their face. I'm here to tell you chances are they will not even remember. So they can't even remember and yet you're still paying for that gift really people- do you think that's smart.
Answer Yes or No to the follow statements.
I pay all my credit card bills in full each month.
I have an eight-month emergency savings fund separate from my checking or other bank accounts.
The car I am driving was paid for with cash, or a loan that was no more than three years, and I sure didn’t lease!
I am contributing at least 10% of my gross salary to a retirement plan at work, or I am saving at least that much in an IRA and/or regular taxable account.
I have a long-term asset allocation plan for my retirement investments, and once a year I check to see if I need to do any rebalancing to stay on target with my allocation goals.
I have term life insurance to provide protection to those who are dependent on my income.
I have a will, a trust, an advance directive (living will), and have appointed someone to be my health care proxy.
I have checked all the beneficiaries of every investment account and insurance policy within the past year.
So how did you do?
If you answered yes to every item, congratulations. If you are working on improving on a few items, I say congratulations as well.
As long as you are comitted to truly creating financial security, I applaud you. If that means you are paying down your credit card balances, or are building up your emergency fun with automated payments, that’s more than fine. You are on your way!
But if you found yourself saying No to any of those questions, and you’re not working on moving to Yes, then I want you to stand in your truth. No matter how good you feel, you have some work to do before you can honestly know what you are on solid financial ground.
Credit & Debt, Saving, Investing, Retirement