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I came across an interesting post on a blog called the Bankruptcy Reader.  The author sets out 101 Financial Tips You Never Learned in High School (but should have).  Most of the points are common sense (i.e. “earn more, spend less” and “avoid cash advances”) however, I think that the list is worth a read as you will likely pick up one or two points that you had not previously considered.

The Bankruptcy Reader sites seems to be down – here is the list that I pulled from a web archive:

Can you survive one month without buying ANYTHING on credit, and use cash that you’ve earned or saved up for all expenses. You’re sure to lose. Here’s why:

Nearly 50 percent of college students are in credit card debt.

One in every 100 families is today affected by a bankruptcy.

And nearly 50 percent Americans are supposed to be living beyond their means.

 

A disaster waiting to happen? You bet! So, why is it that despite being more educated than their grandparents, today’s generation just doesn’t know how to save its pennies? A college degree is no guarantee of an ability to manage your money wisely. It takes effort and discipline. Here are a few simple and yet rarely used tips to get your finances back in the pink of health.

 

Charity Begins With Yourself

 

Learn to be selfish with your money and use it for your benefit first.

 

285351485_de83b1cfca 1. Save for yourself. Don’t wait till you’ve met all your financial obligations to begin saving. Try to set aside around 5 to 10 percent of your salary before you pay your bills.

 

2. Create and stick to a budget. It is important to know where and how your money is spent so you can cut unnecessary expenditure and meet your financial goals.

 

3. Set goals for yourself. Working toward a fixed goal makes saving money easier. For instance, you can decide that in say 15 years, you should be able to repay your student loan, or own a home.

 

4. Save To Spend: You don’t need to deprive yourself of the comforts of life. Only ensure that you can pay for them with cash. For instance if you must have that new jacket, save for it and buy it only when you have the cash in hand.

 

5. Earn More, Spend Less: Ensure that your earning power is more than your spending power. It’s easy to let go and spend, spend, spend. For once, try to curtail your spending so that it stays within your income limits. You’ll be surprised at how much you can save this way.

 

6. Avoid unnecessary debt. America is steeped in debt culture and everything from education to consumer goods is bought on credit. Wherever possible, try to reduce your debts. And remember, no debt is ever good in the long run.

 

7. Pay your debts. Debt’s never good. If you’ve bought something on credit, try to pay off those bills ASAP. This will help you avoid late fees and prevent overspending.

 

8. Know your worth. You work hard at your job and it is important that you get paid well for it. For this, you must know what your job is worth and where you stand within the organization. And if you think you could get more, ask your superiors for a raise.

 

9. Emergency Fund: In addition to your savings account, if you can afford it, try to keep some money apart as an emergency fund. This will come in handy when you have any immediate requirements, and will help you stay away from unnecessary loans.

 

10. Invest: Begin investing as soon as you begin to earn. You could invest in mutual funds, and other investments or contribute to a retirement plan.

 

11. Use Your Employment Benefits: At work you can avail of numerous employment benefits like a 401(k) plan, flexible-spending accounts, medical and dental insurance, etc. All this adds up to a lot of money, so remember to make full use of these benefits and reduce your expenses and taxes.

 

12. Insure Yourself: Do you have insurance cover? It is important to take insurance coverage as it helps you tide over eventualities. But while you are at it, remember to check what kind of insurance cover suits your needs. Taking unnecessary coverage could make you lose money.

 

13. Keep records of every financial transaction. These records help you claim income tax deductions and credits.

 

Credit Card Basics

 

Avoid getting yourself a credit card unless you absolutely need to have one. Credit cards are the bane of our society – you cannot do without them and you just cannot have them. So what do you do? Learn to maximize the benefits they offer.

 

165497447_e1f5c896ec 14. Resist temptation. This is easier said than done but try to resist the urge to use your credit card for anything but emergencies or items you can pay off at the end of every month.

 

15 Ensure that your credit score is healthy. How do you do this? Pay your bills on time, avoid maxing your credit line and don’t collect more than a couple of credit cards.

 

16. Get yourself a debit card. It helps you develop the discipline of staying within your financial limits. Debit cards give you instant access to your money and limit your spending capacity.

 

17. Research well before you take up a credit card and ensure you get a card that best suits your purposes. Try to ignore the free t-shirts or other tempting offers from credit card companies when choosing a card. You must look at the annual fee, the interest rate, grace period, late fees and other charges.

 

18. Guard your credit card number, social security and bank account numbers. Never part with this information unless you know who needs them and why.

 

19. Get cards that offer some sort of incentives and rewards.

 

20. No Cash Advances: Avoid using your card to make cash advances. This will not reflect too well on your credit score and you will also have to deal with unbelievable interest rates.

 

21. Credit Report Copies: You can get a free copy of your credit report once a year from Experian, TransUnion or Equifax. This will help you know where you stand and what you need to do to better your score.

 

22. Prevent your APR from rising. You can do this by paying your credit card balances in full every month.

 

23. Consider your credit card as a loan. Every time you take out your card to buy something, ask yourself if that product/ service is so necessary to you that you are ready to take a loan for it. More often than not, you’ll realize that the purchase can wait till you’ve got cash in hand.

 

24. Deduct your credit card purchases from your checking account. This will ensure that you have enough money to pay the bill.

 

Right To Reasonable Education

 

High school and college are the wonder years of our life – a time when you are free to be yourself. But you must avoid these simple mistakes, which could ruin this perfect idyll.

 

25. Choose a job-oriented course. Agreed, this sounds unromantic especially when you should have the freedom to study what you want. But ground realities dictate that you take up a course that will ensure a good career with enough money once you complete your education. This will help you repay your loans.

 

26. Get professionally qualified. You cannot afford to stop studying once you are out of college. The more professional qualifications you have under your belt, higher is your value.

 

27. Search for public universities in your state rather than attend out of state schools or private schools.

 

28. Choose inexpensive colleges. A community college is as good as any other college if you are strapped for cash. You’ll save tens of thousands of dollars, which can reduce your student loans considerably.

 

29. Invest in a 529-college savings account. It’s tax-free.

 

30. Don’t waste money buying new textbooks – it’s a phenomenal waste of good money. Buy used textbooks instead. Oh, and by the way, those dog-eared books only help to make you look studious.

 

31. Most colleges have excellent resource centers and libraries. Make the most of these resources and only buy books that are essential.

 

32. Sell used textbooks and equipment once you are done with them. This will help you get over your good deed (toward bargain-hunting freshers) and will leave you with some money.

 

33.Check Scholarships: There’s a lot of free money floating around in the form of scholarships. You may have to be quite persistent with this but if you keep trying, you are sure to find some scholarship that will help you reduce your costs.

 

34 Don’t forget to attend class. You’ve spent a lot of money and come here not to lounge around. It’s all right to skip class every now and then, but don’t make a habit of it or you could ruin your future.

 

35. Skip unnecessary trips. Agreed, you may be homesick, or probably you want to go on a long road trip. Either of them is going to cost you quite a bit of money. So unless you’ve got enough money set aside for this trip, you could think of skipping the spring break. And don’t worry, you’ll not be missing much coz campus life can be great fun too.

 

36. Get a part-time job. As I mentioned earlier, stay back on campus and look for a job/s that will help you get some extra cash into your pockets. Try to get one that offers decent tips. Or you could do an internship, which is a good way to get an idea of the kind of careers open to you.

 

Saving on Basics

 

Some things that we take for granted could be huge money drainers. For instance, your cell phone could be causing a huge leak in your savings. You must repair this leak and ensure that you are not wasting your money.

 

37. Get the best deal on a checking account. It’s a good idea to shop around before opening a checking account.

 

38. Never bounce checks. Not only will you lose a hefty sum as fine, a bounced check can also hurt your credit record. To avoid bouncing, ensure that you have enough balance in your account before you write a check.

 

39. Entertainment need not be limitless for it to be fun. Set a limit for the money you spend on entertainment and stick to it. It’s easy to withdraw money every time you feel the need to watch a movie or go out with your friends. Only remember, you are depleting your bank account and creating problems for yourself.

 

40. Learn to ‘make do’ with what you can afford. Agreed, it is difficult and there are times you really want to get yourself that funky stereo or new set of duds. But if you can control these yearnings, you’ll end up saving quite a bit.

 

41. Stop being lazy. Try to walk or ride a bike to school/ college. This way you can leave the car at home and not have to bother about insurance, maintenance and gas – things that eat right into your savings. Or better, you could go around with a friend who owns a car (let them handle the expenses).

 

42 Don’t let your stupidity cost you money. There are quite a few expenses that are unnecessary and can easily be avoided if you are careful. One such expense is a parking fine – an absolute waste of good money. Follow the rules at all times and read the signs to prevent loss of money.

 

43. Discounts are those little bonus points you can collect along the way. There are many different types of discounts and perks available to students. These range from pizzas to plane tickets. Look for these discounts and make full use of them.

 

45055860_ba80742025_1 44. Avoid eating out all the time. Eating out can be a huge drain on your resources and your health as well. Your neighborhood fast-food restaurant not only helps you bloat your belly, but also reduces your bank account considerably.

 

45.Save on Gasoline: You can save a few hundred dollars a year on gasoline if you compare prices at different stations. Pumping gas yourself, and use the lowest-octane called for in your owner’s manual to reduce prices further.

 

46. You are already snowed under by huge student loans and other debts. So, try to avoid other types of non-academic debt.

 

47. Use coupons, cut expenses. You could look up your local newspapers for coupons.

 

48. Shop smart. Grocery shopping can be quite a drain if you are not careful. Don’t go in for fancy brands, use generic or shop brands, cook simple meals from scratch and eat homemade food more often.

 

49. Limit your phone talk. Telephones can be huge money drainers so it is important to decide on an amount you can spend on a phone bill and stick to it.

 

50. Go cellular. Some cell phones allow unlimited calling on nights and weekends, or a flat rate for all calls. If you are lucky enough to find a plan that fits your requirements, get yourself a cell phone and cancel your regular phone line.

 

51. When using your cell phone, remember to avoid exceeding your free minutes. Calls over and above your allowable minutes are very costly.

 

52.Write letters or use e-mail instead of calling long distance.

 

Loan Traps: Avoid Them

 

Loans are an integral part of our lives and we need them at every step. But don’t let your loan rule your life. There are a few things you can do to keep your loan in check.

 

53. Consolidate your loans. If you think your student loans are too many and too much, you probably need to consolidate them. This will definitely increase the repayment time but will also reduce your monthly outlay.

 

54. Mortgage loans can be refinanced to reduce your rates.

 

55. Home As Collateral: While home equity loans do offer attractive loans at reasonable rates of interest, remember, your home is the collateral here. Unless you really need the money, avoid a home equity loan.

 

56. Take advantage of payday loan. One loan you must stay away from at any cost is a payday loan. These loans ensnare you into a debt cycle, from which it is almost impossible to get out.

 

57. Beware of frauds. Ensure that you do your homework well before you take that loan to prevent being tricked out of your money.

 

58. When going in for an auto loan, try to shop around for the cheapest loan. This way, you can save hundreds of dollars in finance charges.

 

Love Yourself

 

Did you know that you could save thousands of dollars by just ensuring that you are healthy and happy? Here are a few things you could do to keep yourself smiling and healthy.

 

58. Limit your consumption of liquor and cigarettes. These are expensive habits and you must indulge in them only if you have huge sums of money to shell out.

 

59. Get back into form. It’s very easy for us to get so involved in our daily activities that we tend to forget ourselves. Daily life becomes a routine and getting to work becomes more important than reducing that flab. But don’t forget, a healthy body costs far less to maintain than an unhealthy body. So, keeping yourself healthy can improve your financial health too.

 

60. Cheap Fun: Enjoyment need not come from spending bucket loads of money and getting the latest gadgets, clothes, etc. There are other ways to find fulfillment. You could try joining various clubs, or write articles, compose music – in short, do anything that interests you.

 

61. Know what you want. Don’t get stuck with something only because it involves money. Decide what’s important to you, and pursue that.

 

62. Be patient. When you want to buy something, ask yourself if you really need that thing. You should never buy on impulse. Wait it out and if after a month or two, you still feel you’d like to buy that particular object, go ahead and buy it. Another benefit of waiting is that over time, prices of products reduce and you could buy the gadget you want at a lower price.

 

63. Love Your Job. Being good at what you do and enjoying it will help boost your career beyond your wildest dreams. Just be sincere and inculcate good working habits.

 

Cow_1 64. Take Risks. You don’t need to work for someone to make big bucks. If you have any particular talents you can cash in on them. For instance you may be good at car repairs or are a decent drummer. Use these talents to make some money and as your clientele grows, you can increase your rates.

 

65. Resist peer pressure. Whether in high school, college or at work, you’ll always find some people who like to live the high life. And if you tag along with them you’ll be pressured into spending money you don’t have. Learn to say, “Sorry, I cannot afford to do that”

 

66. Do You ‘Need’ Or ‘Want’ Something. Never buy something just because you want it. Every time you go shopping, try to categorize items into ‘needs’ and ‘wants’. And then, only buy things that fall into the ‘needs’ list.

 

67. Stay At Home. It may not be the ‘in-thing’ to move in back with your parents. But if your intention is to save lots of money fast, then probably moving back home will be a wise decision. You could save thousands of dollars a year on rent and bills. And then, you get the added benefit of homemade food.

 

Car Wisdom

 

If you are intent on saving money, keeping the car at home is a good idea. But if you absolutely need a car, here are a few things you could do to reduce costs.

 

68. If you haven’t got a car yet, consider buying a used car. With a new car, you’ll end up paying a bomb just to maintain it.

 

69. Compare: Before settling for a car, try to compare insurance, maintenance, and repair costs for different models. A model with low operating costs can save you thousands of dollars.

 

70. Drive safely. Not only does it help save your neck, it keeps your insurance down as well. Insurance companies charge less for drivers who have no violations or accidents.

 

71. Shop for insurance. Never settle for the rates offered by the first insurance company that comes your way. Compare prices of several companies, check for discounts and then go in for the one that best suits your budget.

 

72. Raise the insurance deductibles on your car.

 

73. Love your car. I mean it. If you take loving care of your car and get routine maintenance done regularly, it will serve you well and will last much longer that you expect.

 

74. Combine errands and reduce travel. This way, you’ll only have to take your car out once or twice instead of all day long.

 

75. Carpool. This is energy saving, environment friendly, and a great money saver.

 

76. Save over $100 a year on gas by keeping your engine tuned and tires inflated to their proper pressure.

 

Tax Savings

 

77. Keep a note of all the important tax dates. Try to file your taxes correctly and avoid paying too much.

 

78. Know the tax deductions you can avail of and make full use of them to reduce your tax liability.

 

79. Going for a charity? If you’ve given any money or goods to charity, keep records of the same and claim exemption for it.

 

80. Tax-free investment? If you haven’t invested in tax-free investment yet, do so as soon as possible. These investments give you a chance to earn tax-free interest.

 

81. Increase your 401k or IRA contributions. This will help save taxes and is beneficial in the future as well.

 

Simple Living High Savings

 

Save on simple things that add up to a lot of money.

 

82. Try to buy things at a sale. Sometimes, shops are ready to offer goods at a lower price – you only need to ask if the item you require is on sale or if you could get it at a sale price.

 

83. When out purchasing anything, try not to stick to one retailer if you want to save money. Shopping around will help you get an idea of the best prices on offer.

 

84. When you need to get medicines prescribed by your doctor, try getting a generic one. You’ll have to pay much less for it.

 

85. Order your prescriptions through mail. You could try ordering your prescriptions through mail order instead of your local drug store. It works out much cheaper.

 

86. Try to get multiple insurance policies to lower your rates. You could get car and home insurance from the same firm to reduce your costs considerably.

 

87. Avoid ATM machines that charge fees. What you could do is budget your monthly expenditure and withdraw a fixed amount each month.

 

88. If the public transport in your city is good, try using it. It works out much cheaper than driving your own car and is less stressful.

 

89. Get health insurance. It may seem a drain on your resources but just think of how much money you will lose at the doctor’s if you don’t have any insurance cover.

 

90. Optimize your 401(k). If your employer offers employer match, try to set your 401(k) contribution to that amount or more.

 

91. Buy airline tickets in advance to take optimum advantage of low rates.

 

92. When traveling on vacation, get an idea of how much you’ll be required to spend, create a budget and try to stick to it.

 

93. Plan your vacation. If you love to travel during vacations, off-season’s a good time to travel. This way you get lower prices and no crowds.

 

94. Invest your spare cash instead of letting it lie in a savings account. If you are young, you could think of investing in stocks, which are a good long-term investment strategy. As you grow older, you could consider less risky options like bonds.

 

95. Never put all your eggs in one basket. You must diversify your portfolio so that not more than 10 percent of your portfolio lies with any one company.

 

96. Research Before You Buy: A golden rule of investment is that you should know what you are putting your money into. If you don’t understand how the investment works, avoid it.

 

97. Make your home more energy-efficient. This way you’ll be able to reduce your heating and cooling costs.

 

98. Save energy. Switch off lights and other appliances that are not in use. Also, shop around for energy-efficient lamps. You’ll be surprised how much money you can save by being careful.

 

99. Keep track of your spending. Begin with writing down your daily expenses in a journal for at least a month. At the end of this period, review your spending decisions and make necessary adjustments.

 

100. Upgrade your home – especially your bathrooms and kitchen. This may seem like an expense but when you put your home up for sale in the market, these upgrades will ensure that you get a better price for your home.

 

101. Relax. Realize that money isn’t everything and that you needn’t drive yourself around the bend trying to save every penny. What is more important is that you enjoy what you do, live a good and happy life. Money is only a means to help you live your life well – if you use it wisely, you can achieve your dreams.

So many of my clients end up in bankruptcy because they forgot about some of these common sense ideas.  So, while there is nothing earth shattering here, this post offers a good review of some of those common sense ideas that may end up keeping you solvent and out of bankruptcy.