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Newsletter to Your Friends (Use this link only if you receive this newsletter by email) Week of November 16, 2009This is an OPT-IN list ONLY! If you feel that you have received this message in error, please follow the directions at the bottom of this email to unsubscribe. Thank you.Click Here to view this newsletter online. Navigate This ColumnGrandpa Terry's Update Welcome to The Budget Stretcher! Here is a web site for kids from the US Government that has some helpful resources. I'm not sure whether we should trust the government to teach us or our kids about how to manage money. You would think they would lead by example!! You can Click Here to take a look anyway. I have something else that may be fun to list in the newsletter. Every state and many citys have laws that are just crazy. I'm going to list one of those law each week. Let me know what you think!! PENNSYLVANIA No man may purchase alcohol without written consent from his wife. Compliments of Loony Laws.com "Free Candy Christmas Wreath e-Book" Winter is on it's way and along with that comes high heating bills. There are several things that you can do to cut those costs. Here is just a few from About.com: Winterizing Your Home This week the topic is: Cell Phone Savings Submit your tips for this or other topics by using the form on your Your Subscriber Benefits Page to get your free gift if it is used. Our "Secret Offer" may be a free download or a program that I recommend for you that costs a little bit of money. This is not a gimmick or a trick and you make the final decision whether you want the offer or not. That's all for now. Remember, I really enjoy hearing from you folks. If you have any comments, complaints, suggestions or just want to say Hi, please send me an email to tre2000@midwest.net If you know someone that may be interested in subscribing to our newsletter just copy and paste the below link into an email to them and have them subscribe: http://www.homemoneyhelp.com/confirmsubs.html Have a great week, Grandpa Terry Sponsor AdvertisementGrandpa Terry's Tip of the WeekI hear negative comments all the time about money matters. "I can't" seems to be the way most of them start out. That's no way to get control of your money, right! I bet you were thinking I was talking about the email I receive or the people I come in contact with. Actually, I'm talking about myself. Many years ago I had every excuse in the world why I couldn't pay my bills and actually got aggravated at my bill collectors for expecting me to pay when I didn't have any money. On one occasion, I received a letter in the mail from a loan company calling me irresponsible. I decided right then and there that I was going to show them. I filed for bankruptcy!!! That was a decision I regretted for several years. That wasn't the end of it. I continued to live way beyond my means year after year. Quite frankly, it was the aggravation, humiliation and embarrassment of being turned down every time I applied for a loan that made me realize that I was the problem, not the lenders. My wife and I decided it was time to change things. We had small kids and was having a hard time buying the essentials. We owed our kids more! It took about 3 years of skimping to finally get to the point that we had enough money to pay our bills on time and buy what we needed. That was a miserable 3 years. Believe me, I know there are circumstances that you can't control that can have a devastating impact on your budget. My first daughter only weighed 3 pounds 5 ounces when she was born. She was in the hospital for 7 weeks and that hospital stay cost over $12, 000. That doesn't sound like much now but when you are only making $72 a week for 42 hours work it was a fortune. The bottom line is that I had to take some drastic measures to do what I needed to do to properly support my family. Even after 30 years it still seems strange giving advice to others about their money problems after what I've done in the past. While your money problems may be a little different than mine, most of us have what it takes to overcome them. I've seen it done many times. Please take this from someone that's been there. Dig deep within yourself and find out what the problem is and then make a plan to solve it. You may not like what you have to do but, in the end, you will be very thankful that you did. Sponsor AdvertisementEditor's Note: I wouldn't trust my computer backup to any other company. Your computer files are not only backed up on their servers but also on your computer. Make a mistake and delete something. Just go in and retrieve it. It's that simple!! Grandpa Terry's EmailHi Grandpa TerryI am debating on refinancing (as I am always looking for a way to save money) and I received this offer. I was wondering if you have ever heard about this company before and if so, what do you think? It seems too good to be true. If it is legit, I would like to share the info with your readers as well. Thanks so much for all you do! Keep up the great work! Trish New Jersey My Response: Hi Trish, I checked http://www.carnegiemtg.com/ and they appear to be a legitimate lending company although I've never heard of them before. I don't believe this is a very good deal. First, you would only be saving $38,880 over the 30 year life of the mortgage if you still have 360 months to pay on your existing mortgage. However, if you have made very many payments you would save even less or nothing at all. For example. Let's say you've paid on your existing mortgage for 24 months. Here is how the costs stack up: Your current mortgage: Payment $1154 Not including escrow Multiply by 336 more payments you have to make - $387,744 Carnegie Mortgage proposal: Payment $1046 Not including escrow Multiply by 360 - $376,560 To find out exactly the savings or cost simply multiply the number of actual payments you have left on your current mortgage by $1154. Then compare this to the Carnegie proposal of $376,560. I hope this helps. If you have any other questions just let me know. All the best, Grandpa Terry Hi Grandpa Terry~ You are starting to seem like an old friend! I was inspired by the article this week about second jobs. Because the harvest here has been delayed by bad weather we are not very busy at our dental office right now. I work four days a week, but see the possibility that that may go down to three, and I have been considering a second, part-time job. After reading this article, and after the day I had yesterday, I don’t think I’m going to do it, unless, of course, the perfect one presents itself (I am not going looking). Yesterday a couple of ladies visited our farm. They were acquaintances, but now are on the way to being friends. We walked all around the farm, from horse to horse, petting and feeding treats, and trading horse stories. It was a wonderful two hours. They commented several times about how peaceful and relaxing it is out here. Maybe my calling is to open our farm to visitors who need peace and relaxation. After they left, it felt like that was the direction I need to go. For one summer we worked with an addictions center to provide “horse therapy”. It was amazing what happened between the clients and the horses, and I have been upset every since that the addictions center did not continue the program. Of course I would like to get paid for my efforts, but if it isn’t going to happen, then I think I’m going to respond to the people who tell me they are down, invite them out for my own version of “horse therapy” and see what happens. Yes, as you mentioned once, I am committed to getting our bills paid, but I also realize there is more to life than money. The older I get, the more I realize the best things in life really are free! It’s a good place to be!! Have a great week, and thanks for all you do! Brenda My Response: Hi Brenda, It's always nice to hear from you. It's unbelievable how much a second job could cost you. A better alternative is doing something like you are considering (the horse therapy) at home. It's something that will be very satisfying to you, will help others and could produce an extra few dollars. Since you are undecided on whether to charge for the service, I would recommend accepting donations. I believe many people will think the service is worth something. You bet there is more to life than money. Every year at Christmas time I put a note in the newsletter asking everyone to take a few days off from their everyday worries and just enjoy their family and friends. Very seldom do our fondest memories have anything to do with money. Have a great week, Grandpa Terry Hi Grandpa Terry, I need some help and I am getting it from all around but none of it seems to be good advice to me. I have been getting your newsletter for about 2 years now, thanks to my Aunt, Joyce Moseley Pierce and thought maybe you might be able to give me some ideas. My husband is self employed and the company that he sub contracts with has lost their big contract, so thus he lost his work and our income. There is no prospect for work until next year which is not a guarantee, but I don't know what to do right now. I had put back several months of budget money just in case, I am so very thankful that I did but it is almost gone. The advice that we are getting from everyone is to file for bankruptcy, everything in me says no, but I just don't know what to do. I am not asking for you to give me the magic pill and to make this all go away, I just need some advice and I felt like you would have good advice and could possibly help me think of other options. I can not work due to health issues so the burden is on my husbands back and now that we are running out of money, it is a stress for us all. I do believe that Yahweh is our provider and will help us through whatever we will go through, I know He wants us to pay our debts and this is what I want, but I also don't want to be the guy that is on the top of his house when there was a flood and asking Yahweh for help and missing the boat, helicopter and what ever else was sent to save him and he passes each of them off saying that Yahweh will save him. i need wisdom! I thank you for your help and if you would rather not even tread this territory I understand but as they say, it never hurts to ask! Karrel My Response: Hi Karrel, Tell your aunt Joyce Hi for me!! I don't mind treading in this territory at all. You are right that there is no magic bullets to make it all better but there are things that you can do. But you have to understand that extreme financial problems require extreme solutions. While bankruptcy is the last option it is an option that you may have to consider. But make sure you try everything else before you make that drastic move. The first thing that you need to do is prioritize your spending. Please read the article at the below link and follow it to the letter. This will ensure that you make the most of what money you do have. Setting Your Financial Priorities http://www.homemoneyhelp.com/articles/priorities.html Second, have your husband use what ever talents he has to earn extra money. Simply place an ad in the newspaper, ask friends or family if they have any work or if necessary go door to door. Now is not the time to be picky about what kind of work you do. If push comes to shove you may need to apply for assistance through your state. I'm sending you a copy of my ebook that will explain what you can do a lot better than I can in an email. Here is the link to download: Living Within Your Means - The Easy Way (Only Available To Premium Members) This should keep you busy for a while. If you have any more questions after reading the article and my ebook don't hesitate to let me know. All the best, Grandpa Terry Featured ArticleThe Dollar Stretcher Blog by Gary Foreman Dear Dollar Stretcher, From the total salary what percentage is ideal to spend for various needs, and how much to be saved for future? Dee It's a question that we all must answer. Even if some of us would prefer to ignore it! Because, with rare exceptions, we all have to deal with having just so much money to cover all our expenses. And, if we spend more than we take in for very long we get into trouble. Let's look at a "typical" spending plan. Then we'll discuss it.
The first thing you'll notice is that I didn't include any taxes (either income or Social Security). You can choose to do that if you like (in fact, it's a real eye opener). But for our purposes it's easier just to deal with your 'take home' pay. The second thing to notice is that this is a guideline, not a straightjacket. The truth is that very few of us will fit into this exact framework. So if your spending doesn't match, don't despair! Analyze the situation before you panic! For instance maybe your entertainment spending is closer to 10%. Is that a problem? Maybe not, if you're young, single and sharing an apartment with 3 friends. In that case what you save on housing is going for entertainment. So overall you're not spending more than you're making. Or you may be a city-dweller where housing is very expensive (think NYC). But because of public transportation you don't own a car. So the extra you spend on housing is offset by the reduced spending on transportation. You get the idea. Tailor your spending plan to your needs. And, adjust it as you go through life and your needs change. One other thing to notice is that housing, food and auto make up the lion's share of the expenses. That's true for almost everyone. It's in those three areas that most families get into trouble. Most often by buying a home or vehicle that they cannot afford. But once the commitment is made it's very hard to undo. You might wonder where a certain expense goes. For instance, household cleaning supplies. Many people buy them at the grocery store. So are they a housing or food expense? The answer is: it doesn't much matter. Put them whever it seems best to you. The key is always putting them in the same place, so you can compare results from month to month. Another common question is what should I do with charitiable contributions. You can either take it off the top (like taxes) or create a separate category for it. If you believe that contributions should come before your expenses you'll want to take it off the top. If you think that it's part of your regular spending then include it as another expense category. Finally, let's look at Dee's question about saving. There probably isn't any single right answer. Because saving isn't really an expense. It's an investment for a better future. So I prefer to think of savings in terms of priorities. Before I can put money aside for savings I need food and a reasonable shelter. Probably also need dependable transportation to get to my job. But after those basic needs are met, it's time to begin saving some money. Not necessarily the 10% in our guidelines, but 2, 3 or 4%. Enough so that there's some money set aside for the so-called unexpected expenses that happen to us all (dead appliances, home and auto repairs, unexpected sickness, temporary lack of work). One other comment about savings. Paying off debt (especially credit card debt) is a little like savings. Consider payments used to reduce the amount owed as if they were savings. Finally, for those of you who don't want to bother with any of this. I know what you're thinking: I'm fine and don't need any help monitoring my money. Just remember that most people who are in trouble today said the same thing when everything looked good to them. Gary Foreman is the editor of The Dollar Stretcher.com website and various enewsletters including Financial Independence. FI is a daily message designed to help people take control of their financial lives through achieving small daily goals. To find out more check out the Financial Independence page. |
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