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Hello and welcome to DrFrugal.com. If you've ever had the unfortunate experience of trying to find information online that has anything to do with money, you know most sites are worthless because they're trying to pawn something. Not here--there's nothing to buy. I've tried my best to only include pragmatic, realistic informtion to help you lead a simpler life by taking care of your personal finances.

Recent Entries/Articles

Resolving Doors: How to fix finances for new year

When it comes to resolutions for the new year, two items are at the top of everyone's list: health and money.

And when it comes to money and stressing out about it, those two go hand in hand.

For most, "health" is defined as that bid for the new year to finally start eating right, lose weight and just get in better shape.

Why can't the same be said for yourself financially· Ask yourself the question, are you financially fit as well·

Most of the time that answer is met with a lackluster response or plenty of disappointment, since you're nowhere near where you want to be as far as money goes, specifically how you spend and what you've been able to save.

The new year gives you hope, much the same way you're hoping to drop a few dress or pants sizes, you also can turnaround your belief that saving money is only for those who make a lot of money or have an extraordinary minimal amount of expenses.

But as far as money goes as it relates to day to day life or the new year, you can always be certain that one aspect of saving goes a long way: budgeting.

Being able to look in the mirror and say you have a budget and it is one that you follow and also monitor closely is the true pathway to financial freedom. A lot of people will tell you they have a budget but really that's more lip service than actually practicality at work. Having a budget is only as good as how realistic it is and if it is all inclusive (that means incidental expenses also have to be accounted for as well).

Your budget and your wanting and willingness to save only exceeds another part of your financial wellness: your credit, debt and score.

Your credit score is something you should not only know but monitor. Knowing your score means more than just rattling off three digits but also checking that score periodically for mistakes, for starters, but also so that you know how to begin fixing it, whether you have too much debt overall or your debt utilization is too high, and you have to start thinking about paying down some of your credit cards, for example.

Being prepared for the new year can center on resolutions, but those often don't last for more than a few months (remember that gym membership you purchased in January and canceled in March·).

That doesn't mean, financially, you can't start the new year on the right track but more importantly have it last beyond just these next 12 months and instead usher in a lifetime of smart money decisions.

.... Keep Reading

Early Burden: Why smart money practices should start right away

When you were younger, you mostly likely heard from your parents, grandparents or any adult how to properly do things, whether it was holding a fork correctly or saying "thank you" whenever the situation called for it.

At the time, the explanation was perhaps either non existent or curt, but the overwhelmingly common theme couldn't be overlooked: it was done so that the good habits became like second nature or routine to the point that they're embedded in all you do.

For every piece of silverware you hold or modest gift you receive, you either held that fork properly and displayed graciousness for even the most inconsequential sequence of events, and you did so because you learned it over and over again, without fail, and never looked back.

The question remains, quite honestly, why money can't be that way too· The truth is those who have learned how to spend, save and budget money properly as a result learning, listening and doing are more apt to be successful at all of those financial aspects for their entire life.

The key is learning how to do it at a young age and, like your silverware and thank you's, never thought to change a thing.

The statistics are encouraging, if nothing else. About 60 percent of those between the ages of 20 to 32 have a budget and stick to it, something that seems a little out of place due to just how poor the average savings account is (around $1,000 for that same 60 percent). That $1,000 number might reflect those older than 32, most of which you'd assume never learned the value of a dollar, how to save and then spend accordingly.

The 60 percent of those 20 to 32 year old individuals would suggest that budgeting and knowing just how paramount it is as far as saving money goes doesn't go unnoticed by that particular demographic. The more than half of those individuals in that age group who are budgeting and saving bring great hope to a lagging average as far as money saved is concerned.

Being able to budget and save money when you're young is no different than anything else that becomes routine, financially speaking. If you're always used to not having a car payment or buying used instead of new, why change that· The same goes for rent: if your rent is always kept modest, why would the mortgage on your first house be any different.

Learning how to handle money when you're between 20 and your early 30s allows you to be the same kid who was taught how to not slouch at dinner or talk with food in your mouth and grew up being mindful of those same requests.

Money shouldn't be any different.

.... Keep Reading

Number One: Why your credit score is so important

Do you ever find yourself, from one day to the next, overlooking one key piece of financial information·

Sure, you might have your eyes squarely set on a better budgeting process, cutting some expenses and even making sure you're padding your retirement to the best of your ability. But perhaps as part of all this improvement process as it relates to money, you've forgotten about three very important digits.

Say hello to your credit score.

This three digit number is your code to financial freedom that you wouldn't believe, and your credit score almost is the summary of all you done money wise. That score reflects everything from your debt to income ratio, how much debt you carry versus your debt ceiling (often referred to as debt utilization) and if you're a liability as a borrower in the eyes of a lender.

The lending part is extremely paramount when you consider aspirations of buying a house or car and wanting to have an interest rate that isn't out of the realm of what the going rate is at the moment.

The reason the credit score gets overlooked is because it's not your bank account and isn't as highly visible as it should be. In order to keep your score at a point where you'll be looked upon by potential lenders as a viable candidate for a loan, you don't have to do anything crazy or be all consumed with knowing your score.

What needs to happen are two very distinct and relatively simple things: check your report and don't miss any payments.

Granted, you want to stay on top of other aspects of debt and credit, such as having too much of the former and thus negatively affecting the latter. You also have to make certain you're not carrying a balance on a credit card that is too close to what the total amount owed would be, such as a $10,000 card limit with $9,000 of a balance.

But to keep things easy, make sure (even if it is the minimum amount due) that you're always paying your debt and credit on time. Paying late is going to put a serious dent in that score and if that late payment reaches 30 days, it also will extend into your report and not only knock down your score significantly but also become an amount of money that will go through a collection company.

And if you're not consistently checking your report, how will you know if it is accurate or not· Credit scores and reporting can have mistakes on them, so being up to date on that score and the information that comprises it is key.

In the midst of your budget preparation, expense auditing and other money related matters, don't forget about the all important credit score and how it can impact your finances just as much as anything else.

.... Keep Reading

Missed Opportunities: Are you missing out on saving money·

For those individuals who believe saving money is simply an exercise in income versus expenses, you're not wrong.

You just have financial tunnel vision.

By that, you are focused on budgeting in the purest sense, and there's nothing wrong with that mentality whatsoever. In fact, if more individuals had that, at the very least, down pat, you'd have more than 50 percent of the population with an average of a $1,000 in a savings account.

But if you're just focusing on budgeting, you might be missing out on lost money along the way. Sure, you have to have the budget and always fine tune the process, making sure you don't forget odds and ends and incidental expenses along the way, but saving money also is about thinking outside of the proverbial box.

If you're intent on saving money, start first by examining exactly what you're paying on, more specifically if the interest rates or rates in general you're getting are the very best. Often times, refinancing a home, for example, can save you thousands of dollars per year or hundreds more per month, and that gives you an opportunity to save that money for retirement or just start building a savings account. Also, you can use that additional income to pay down credit card debt.

In addition to interest rates, have you looked at those aforementioned incidental expense and if you truly need them. Yes, they're expenses but are they necessities, and often time the water is seriously muddied with this particular discussion.

A want is something that you can live without, in the simplest terms. If you're looking at things like coffee every day or eating out for lunch three times a week as a necessity, you might have those terms mixed up. Sure, the coffee is nice and not having to worry about actually packing a lunch is equally convenient, but doesn't replace the fact that you have coffee and food at home that can be brewed and prepped, respectively, to avoid spending additional money on each of them every day.

Convenience truly is the kryptonite of saving money. Not having to worry about making dinner, thawing out food or packing a lunch the night before is what leads to the average person spending nearly $500 per month on take out food, and that $6,000 per year is a huge chunk of change that you're out after 12 months of spending money unnecessarily.

These are examples of missing out on saving money, losing that opportunity when afforded it to keep the money in your pocket, due to bad habits or not thinking about money in a more multi dimensional way.

.... Keep Reading

Massive Oversight: Why huge money problems are consistently missed

You'd be hard pressed to find an individual who has it all figured out as far as money goes.

What you typically get is an person, couple or family that tries very hard and succeeds or fails based on the finest of details but also overlooking the obvious as they tend to their money and working diligently to save it.

The larger scale problems are of the utmost concern, particularly when you consider the penchant for people to miss them completely. And when you talk about those large scale issues, you're talking about money missteps that most try to downplay or ignore, hoping that they'll go away when in actuality they're sabotaging your ability to save at every turn.

One that is hard to come to grips with is being with a spouse or partner that doesn't feel the same way about money as you do, perhaps you're the one content on saving and they have a propensity to spend any time extra money is made available.

The relationship might be strong enough to survive such diverse mentalities, but you can't overlook that money is one of the leading causes of separation mostly due to the fact that your significant other isn't on the same page as you from top to bottom, money wise.

This isn't to suggest that you need to end the relationship because they have a spending problem, for instance, but a frank, honest discussion needs to occur about money before any forthcoming steps or big financial decisions occur. The most amiable way of fixing this problem is giving the more financially sound individual of the two the reigns to start a savings plan, develop a budget and save and spend accordingly.

The other proverbial elephant in the room is your ability to earn money and spend it but without a clear cut initiative to save it based on having no budget whatsoever. Everyone has a family member or friend (or maybe it's, in fact, you) who has a decent job and seems to always have money or the ability to spend but can't quite find that brass ring to be able to save consistently or they're constantly living from paycheck to paycheck. That way of thinking is typically surrounded by not having a budget or any idea what you're actually paying for, other than the big three: house, car, student loan. From credit card debt to utilities to take out food, you have not one clue where your money goes.

The bigger money problems tend to center on a lack of organization or conflicting ideologies about money when second or third person is involved. To be successful at saving money, you simply can't have this or need to take whatever steps necessary to fix it immediately.

.... Keep Reading


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