Friday, January 12, 2018

Learning To Love Stability: Budgeting Tips For An Adjusted Lifestyle

Living on a budget often causes dread for those well-accustomed to their lifestyle. The thought of having to give up creature comforts. But, when the tell-tale signs begin to show that you’re living outside your means – it’s time to reassess the budget position.
Yes, budgeted living does place restrictions on what you can and cannot do.
However, those willing to make temporary sacrifices will gain long-term stability. They may even find this new lifestyle more enjoyable due to less stress and societal pressure!

One Slip Toward Financial Ruin – A Wakeup Call for Finances
There were nearly 800,000 bankruptcy filings in 2016 (most being Chapter 7). Much of this is caused by unexpected, financial downturns caused by loss of work and emergencies. We’re sure quite a few were also due to poor planning.
The problem: Most American families are one paycheck away from financial ruin.
Predatory businesses, stagnating wages, and poor healthcare exacerbate these issues. No family goes through bankruptcy for enjoyment. Though, we wonder how many families could have avoided these problems if they were budgeting properly.
How to Get on Track with Your Financial Future
There are hundreds of small items you could sacrifice to reach financial goals – these have been discussed ad nauseam. Items like saving on utilities with programmable thermostats or making coffee at home versus buying one during your morning commute.
Let’s look at the bigger picture.
  • Make health a priority. By learning to cook healthy meals and becoming active. Avoid dangerous situations. Learn to remain calm in tense moments. Many health problems (and their associated costs) are the result of poor diets.
  • Make insurance and meds #2. Americans spend $3.4 trillion (a year) on medical services and care. One can lower these costs through committed comparison shopping. It’s the act of spending a couple extra hours learning health plans. Or, comparing the generic Adderall cost, Zantac alternatives, or natural Lasix replacements.
  • Make haggling the norm. Don’t feel complacent when costs rise year-over-year. Some services are impossible to avoid because of the (virtual) monopoly companies have on an area. Haggle with companies – threaten to switch or simply as “can you change this?” – to see them fall over themselves to retain your customer patronage especially with items like your banking.
Begin funneling these big wins toward micro goals.
Create a user-friendly budget that rewards participation. Small savings (even $5-$10 a week) with small rewards (monthly dinner date or buying a wishlist item) reinforces the good behavior.
Likewise, find cheaper entertainment (almost 5.6% of American spend) through older media, local events, hobbies, or activities like reading or gaming.
The longer you “do without” the more you realize you didn’t need those things. It brings it back to the basics. A lifestyle that becomes less dominated (and stressed) from riding too close to financial ruin on a week-to-week basis.
With Financial Control comes Great Lifestyle Stability
It’s sometimes hard seeing others enjoying themselves through their posting on social media. A fear of missing out because you’re confined to your budget-friendly lifestyle.
Ponder: Do these people live like this 24/7?
People put on a show to appeal to others – social media has doubled this practice – but, they’re leading everyday lives. They go through similar troubles. In fact, their social lifestyle may not mirror what’s going on behind-the-scenes.
Where will they be in 5 years? 10? 25?
Learn to love the stability budgeting creates in your lifestyle.
Do this and you’ll have the finances (and lack of stress) that’ll allow you to create sustained enjoyment from activities instead of sharp spikes and horrible bottoms. A lifestyle that’ll snowball equity and comfort – all started with what you’ll find to be minor sacrifices when looking back years from now.

What Renters Need to Know About Buying a House

There are two kinds of people: renters and owners. And they each tend to have horrible misconceptions about the other. One of those misconceptions is that one is better than the other. Which is better for you depends largely on the life circumstances you happen to have at the time. There are times when renting makes more sense, and other times when owning is the best choice. 
But one thing is certain: If all you have ever known is renting, there is a steep learning curve when going from renting to owning. There are things you simply have no need to think about as a renter that can make or break your prospects as a homeowner. 

One of the things you probably haven’t considered is what national title company you will be dealing with. If you are working with an agent, the title will be handled by whatever title service they choose. But if you are dealing with a sale by owner, you might want to have a more active role in who handles the title. You will also want to make sure you have sufficient title insurance in case there is a situation that puts your claim in doubt. This situation can cost you thousands.
When renting, you never have to think about who owns the title to your rental. That is one of the many professional services you don’t have to deal with as a renter. Here are a few others:
Mortgage Lenders
You might sign a lease for a year. But you pay rent one month at a time. You don’t have to pay 30 years of rent all at once. When buying a house, you do. It’s called mortgage. You get a loan for the total amount, then pay it back to the lender on a monthly basis. 
Often, whether or not you can afford a particular home has less to do with the total cost of the home, and more to do with the terms of repayment. When you rent an apartment, the only terms are the rent amount and the lease duration. Your credit may determine whether are not you are approved. But it has nothing to do with the amount you pay on a monthly basis. 
But when buying a house, nothing is fixed. You need a good lender to get the best terms. If you do not account for this aspect of buying, you will be stuck with unfavorable terms for your first home purchase.
Credit Repair Specialists
Your credit score does matter when you are renting. But it matters a whole lot more when you are buying. Some of the nicer apartment complexes will not rent to you if your score is not high enough. But if you do get in, you will not pay more than anyone else because of your credit score. Mostly, apartments are more concerned with your rental history than a high credit score.
If you want to transition from renter to buyer, you might have to find a credit doctor to help you increase your score before shopping for loans. Not all credit repair services are created equally. Do your homework. If you don’t repair your credit before shopping for loans, you could be denied, or worse, get a bad loan with bad terms. You don’t have to fix your credit before renting. But you absolutely do before buying.
Maintenance Inside and Out
One of the best things about apartment living is when something goes wrong, you fix it by picking up the phone and calling the super, not by opening your wallet. Owning a home means being responsible for all the myriad of things that will most certainly go wrong.
When the sink starts overflowing, you have to call a plumber that you didn’t budget. The grass has to be cut. And you are out of pocket for that tree limb that fell on top of your roof. It will serve you well to get to know a few people who are handy with repairs. And there are always repairs that need to be done.
Going from renter to owner means cultivating relationships with a new set of professionals. Beyond the title, you have to find a good lender, a reputable credit doctor, and a talented handy person for repairs. 

Also, renters need to consider other issues such as the costs associated with moving to a new home like buying new furniture, beds and mattresses, etc.