Harrison Funding and Johnson Funding may be running a debt consolidation scam according to multiple personal finance sites. Harrison Funding has begun flooding the market with personal loan, debt consolidation and credit card relief offers in the mail with the website My Johnson Funding. The problem is that the terms and conditions are at the very least confusing, and possibly even suspect.
The interest rates are so low that you would have to have near-perfect credit to be approved for one of their offers. Best 2020 Reviews, the personal finance review site, has been following Harrison Funding, Johnson Funding, Taft Financial, Georgetown Funding, Credit 9 and others.
Getting out of debt, saving and budgeting are three of the most critical parts of attaining financial independence and stability. The importance of saving is relatively straightforward. It allows you long-term security with your finances and ensures you have cash set aside in case of emergencies. Moreover, savings can be used for discretionary expenses. You can try out new things and take bigger risks when you know you have money set aside to sustain you in case they don’t work out. Perhaps you’ve wanted to start your own side business or even take a much-deserved relaxing trip to an exotic island. Your savings will allow you to live life to the fullest without having to constantly stress over money.
But, where does budgeting come into the mix?
Well, budgeting is how you make sufficient savings! It creates the perfect spending plan for the entire month, ensuring you have enough money for food, utility bills, and all major expenses. Your leftover income will be put aside as savings and grow overtime. Budgets make the perfect tools to avoid credit card debt forgiveness and promote the growth of your savings account.
Now that you know the importance of debt consolidation, budgeting and saving, let’s figure out the best ways to do both. Here are six must-follow tips that every one needs to maximize their savings and be financially responsible.
1. Contribute to Your 401(k) Plan
One of the best ways of saving up is by contributing as much as you can to your employer 401(k). Since these contributions are deducted from your income before taxes, they reduce your taxable income, thus lowering the percentage of taxes applicable. It’s always a good idea to go for 401(k) plans, regardless of how the market is doing, as your employer adds on free money to match part of your contributions.
If you plan to switch jobs, be sure to roll your 401(k) savings into a self-directing fund. Doing so will allow you more flexibility and control over future investments.
2. Follow a Strict Budget
The very first step to making sufficient monthly savings is by living on a budget. It will help you determine how much you need to spend out of your income and the percentage you can put into savings.
The best way to create a budget is to write down your salary (after tax) at the top of a piece of paper. Then, list down all your necessary monthly expenses. Be sure to include things like rent, groceries, utility bills, phone, cable charges, transport costs, etc. You should also set aside a particular amount for entertainment and other luxuries like skincare or makeup. This will allow you to pamper yourself without going overboard.
Estimate the total costs of each expense and subtract them from your monthly income. The amount you’re left with should be put into a savings account.
P.S. You should also consider keeping 10-15% of the total leftover amount in your emergency stash.
3. Have a Reserve for Emergencies
Your savings should be divided into two accounts using a 20% to 80% ratio. The 80% should be kept separate from all other funds so you can avoid the temptation to splurge. On the other hand, 20% should be set aside for emergencies.
This emergency reserve should have at least three to four months’ worth of salary in an easy-to-access account. You can draw out these funds for various unexpected expenses like hospital bills, car repairs, or a leaking roof. Remember, it’s always better to pay upfront; otherwise, you end up with highinterest rates on repayments and credit card debt.
4. Control the Temptation to Splurge
We get it; it can be ratherchallenging to stop your splurging, especially during holiday sales. However, it needs to be done. Bloomberg reported that women generally drive up to 80% of the total consumer spending. That’s A LOT!
It is particularly true for new wage earners who struggle with spending their paychecks smartly. They often find themselves short-ended by the month’s end due to this over expenditure. Therefore, it is essential to stick to your budget and avoid sales or other buying opportunities.
Just because Selena Gomez released a new makeup line doesn’t mean you need to buy it, as much as you’d like to. Be smart about your financial decisions.
5. Pay Off Your Debts on Time
If you’re paying off excessive amounts of debt each month, you will never be able to reach your true savings potential. This is particularly true if you have high interest rates on your credit cards.
Therefore, it is essential that you pay off these credit debts on time each month to avoid any increase in the interest rates. Also, try to minimize spending, so your credit bills aren’t too high to pay off.
6. Invest like a Pro
Once you have saved up enough, you should also look at potential investment opportunities to further grow your savings. Investments are an excellent way to put your money ‘to work’ instead of letting it sit idly and possibly decrease in value.
Consider opting for tax-free savings account for your long-term goals like paying off your mortgage or opening a college fund for the children.
Conclusion
Women generally tend to face a lot of challenges when it comes to savings. This is a result of having to budget for the household, making reasonable expenses for all the members of the family, ensuring the pantry is well-stocked ,etc. However, by budgeting well and spending responsibly, you can ensure financial stability not just for yourself but also for the entire family. Best of luck!
