Category: Financial

Gearing Up for a Financial Spring Cleaning?

On By Maggie S.In Financial

If you’re like me, you are gearing up for spring cleaning. Dust has piled up and the system you had going for organization may need a little extra attention. Have you thought of tidying up your personal finances? They deserve a good scrub, too! I get it – cleaning your home is a lot less intimidating and has immediate results. Yet, the rewards of creating a habit in which you check in financially can lend itself to long term progress.

Let’s look at ways you can spruce up your finances this spring.

  1. Pay towards your debt with your tax refund.
    It’s tempting to use your tax refund money on fun things or vacations. I’m not saying don’t do anything nice for yourself, but keep any debts you may have in mind. Could you pay something off with your tax refund? Want to cut back on some loan interest? It may be worth putting that money towards reducing or paying off a debt.
  2. Consider cutting back.
    With so many subscription services these days it’s easy to let them add up without realizing how much they are really costing you. Take inventory. Are there some you could get rid of? Could you share or split with a friend? Find a cheaper service or option? Making these changes makes you aware of expenses you may not have realized and helps you prioritize.
  3. Meal plan/ buy in bulk.
    There’s a lot of waste that happens in my house when I don’t plan meals ahead. Not just because I’m not buying in bulk, but because when I’m less precise I spend more. The old ‘take a list’ thing is real. Give your finances some love by getting the best deal you can when grocery shopping and stretching those meals/ingredients.
  4. Leave the credit card at home.
    I know, you’ve got that project, that thing you want, but making financial stability your priority is worth so much more than a moments satisfaction. Save up for those items so you can pay for them without adding to your debt.
  5. Have a spend free day/ weekend every now and then.
    Take a day to let the money sit still without being touched. You can still have a fun day! This helps us evaluate what we are spending money on and can be a wake-up call to bored or emotional spending. Get some spend free ideas here!
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Spend some time outside!
  • Outline a debt repayment plan.
    Just hoping that bills will go away isn’t reality. Like everything else, it takes work. So, take this time to get serious and make a plan to start chipping away at your debt. If you have a plan already – great job – tighten it up and adjust it, if needed.
  • Check on your emergency fund.
    Is it depleted, nonexistent? Work on making it priority again and give it a little TLC.

    • Have any other ideas? How do you spring clean your finances? I hope this has encouraged you to spend a little time digging in, and I hope that you see a return on your efforts.

    Get Tips on Reducing Debt

    First-Time Homebuyer Resources

    On By vmfhomesblogIn Financial, Homebuyer Education

    So, you’re wanting a place to call your own? That’s exciting! Have you done your homework? It’s going to take some preparation and research to purchase a home. We want you to be well-informed and encourage you to be your own advocate while researching and making home purchase decisions.

    We’ve gathered some resources and information about being a first-time homebuyer and have provided them below. While by no means all-inclusive, we’re  hoping these resources will help get you started!

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    Homeownership is closer than you think. Get creative with your options!
    • You’re probably familiar with FHA Loans. Loans insured by the government, more specifically the Federal Housing Administration. FHA Loans generally require lower down payments but do require the payment of mortgage insurance premiums which protect the lender if a borrower defaults.
    • If you’re an active or previous member of the military, a VA Loan may be something to consider. Loans offered to credit qualifying veterans, or their surviving spouses if service and entitlement requirements are met. There is a VA loan no down payment option.
    • If you’re interested in living in a rural area as designed by the USDA Rural Guaranteed Housing Program: a USDA Home Loan may interest you. USDA loan programs are designed to improve and grow rural areas and you don’t have to have a farm.
    • If you’re interested in living in an energy efficient home, you might want to consider programs that finance energy saving home improvements as part of the mortgage. Some are offered to first-time homebuyers.
    • Lastly, check your local home loan options! Inquire with local lenders who know the area in which you would like to live for financing options. You might be able to find a local down payment assistance program, or other alternative program that fits your needs!

    Consider a Mobile Home!

    Still on the fence? Wondering what you’ll gain by being a homeowner? Check out these benefits of being a homeowner!

    6 Questions to Ask Yourself When Saving for a Down Payment

    On By vmfhomesblogIn Financial, Homebuyer Education, Learn

    Investing in a mortgage is a big step. It’s one of the biggest financial steps an individual will take in their lifetime. So it’s important to weigh it carefully. Don’t be discouraged by the size of the choice – instead be encouraged by the variety of resources you can tap into.

    Down payments will vary among lenders and in amount, depending on the loan program, type of loan, home price, credit score and budget. Below we’ve crafted some questions that will help you evaluate and analyze your ability to save for a down payment.

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    Be ready for your down payment by asking yourself these important questions.

    1. Is now the time for me to purchase a home? In a society that favors the word “now” over the word “later,” this question may seem silly. But it’s not. Purchasing a home means saving consistently, making payments, paying additional bills, maintenance responsibilities, and more. Check out listings near you and see what’s out there. If you aren’t in a place where you can save or you haven’t been saving. It may be time to wait. Be honest with where you’re at.

         2. What down payment can I afford? The possibility of purchasing a home is exciting. However, often our eyes are bigger than our wallets. It’s important to be practical. Consider how much you can pay out of pocket for a home. That may mean going with a cheaper home or being stricter with your spending.

         3. What monthly payment does my income allow? Simple. How much do you or your household make in a month? What will your house payment do to that number? If it doesn’t cover the cost now – it won’t later. Consider picking up odd jobs or making a bigger down payment, or trying the next question.

        4. What changes in spending do I need to make? Everyone needs to evaluate their spending before purchasing a home. Sometimes we need to prioritize the way we spend money. Leisure spending may not always be an option. If purchasing a home is a goal, consider how you can cut spending or alter your habits.

    Get Savings Tips Now!

        5. What method will I use to save money? Automatic saving accounts are the most widely recommended method of saving. Usually free, they can be drafted from your pay without effort from you. Banks sometimes have programs for first time buyers or you could invest. You could even try putting a dollar or change in a jar or bucket every day and depositing it every so often.

         6. Do I need to ask for lower rates? If you’ve tried everything above and you still need some wiggle room – evaluate you bills. Are you paying high interest rates on credit cards? Has your car insurance been the same for a while? Consider calling and asking for lower rates. This could put more money in your pocket.

    Congratulations, you’re doing your research and preparing well! Are you ready to start saving or do you need to work on one of these questions?

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    All Things Credit: Fact vs. Fiction

    On By vmfhomesblogIn Financial, Homebuyer Education

    Credit is complicated. There are no two ways about it. The best approach to dealing with credit is to educate yourself. This takes time and sometimes it means making mistakes, but don’t let the past dictate your future, push forward.

    If you’ve had a hard time with telling the difference between fact and fiction when it comes to credit — this sheet is for you.

    Fact:

    – Credit reports list your payment history

     – Credit reports from the three nationwide credit bureaus can be obtained free once a year

    – Credit scores are separate from credit reports, however credit scores are typically generated by credit bureau reports

    – If YOU check your score, it does not lower your score. If a lender does, it can lower your score

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    When it comes to credit, do you know fact from fiction?

    Fiction:

    – The number of credit cards a person has boosts their credit

    – The higher the income, the better the credit

    – Paying bills late will always lower your score

    – Bad credit is forever

    From fiction to fact…

    “The number of credit cards a person has boosts their credit”

    Your credit score does not factor in how many credit cards you have, but it does factor in credit card balances, credit history, late payments and the amount of credit card balances in relation to total available credit. Having more credit cards provides an equal opportunity to pay on time and to miss payments. Again, it all goes back to responsible and timely spending. It’s the quality of your spending, not the quantity (it’s the amount being charged, not the number of credit cards).

    “The higher the income, the better the credit”

    How much income a person makes does not correlate to how they spend it.   Your credit report shows if you pay your bills on time and the frequency in which you do so.  While making more money may help you meet your payments, a credit score is dependent on how you practice financial responsibility.

    “Paying bills late will always lower your score”

    Don’t make paying bills late a habit. Most credit card lenders provide a grace period after the due date to make a payment. However, when paid after the grace period late payments are generally reported to the credit bureaus and can lower your score.

    “Bad credit is forever”

    Bad credit does last, but not forever. It usually ages off credit reports after 7 years, but that time can be extended if you have been through bankruptcy. That’s a good amount of time, but you can pay off debt.

    Start Building Your Credit!

    When Paying Ahead on Your Mortgage Can be Beneficial

    On By Maggie S.In Financial, Homebuyer Education

    When we started our mortgage, I was shaken up by the number of years and total of payments behind owning our home. It seemed so big, and I could only see it getting bigger with interest. In the first year of owning, we tried to simply get used having our monthly payment. But after researching I wanted to be a little more proactive in paying off our home.

    Pre-paying your mortgage is situational. It’s not a one size fits all, but it can save you a lot of money in interest if you are in a financial position to do it. For me, it makes sense to pre-pay an extra fifty dollars a payment to cut time and interest off my total amount owed. Let’s dig in and look at when paying ahead can be beneficial.

    If you’ve found your forever home. If you know you plan to stay in this home for a long period of time, then paying it off faster may be worth it. That way you are putting money into something that will benefit you and your family for years to come.

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    If you’ve found the place to call home, you’ll feel more at ease in investing in it. 

    You’re in a financial situation where you can focus on debt. When you boil it down, the difference between paying off your mortgage sooner or later is when you want/need to have more money. What I mean is that if you are in a tight spot financially now with lots of bills and financial responsibilities you probably would benefit more from paying your regular payment.

    On the other hand, if you don’t have a lot of bills or financial responsibilities and you’ve got savings you may want to pay down your mortgage debt now. This may give you less money in the future, but you also will have less debt. It’s always a catch 22. Moral of the story: if it won’t hurt you to add even 10 dollars a month, it may be worth considering. If it’s going to hurt you financially it’s not worth it – this is voluntary, not mandatory.

    You want to eliminate as much interest as possible. In light of my own financial philosophy, reducing the amount of interest I pay over the life of the loan is a major motivation. Interest is a quiet debt, and for that reason I like to address it head on. The extra amount you end up paying by letting interest compound is significant. So, whenever I see an avenue to reduce my mortgage debt and the amount of interest I owe on that debt – I’m willing to do it. Even if it means having less money to spend now. I’d rather have less or no debt now than more money, but everyone is different.

    You have some savings. It’s important to have some cushion. If you’ve been able to save, then pre-paying may also be appealing to you. That way you’re not spending the only money you’d have for emergencies and you are focusing on prioritizing your funds. Many people recommend having 3 – 6 months of earnings in savings, but this isn’t realistic for everyone. You should know based off your budget how much you might need if an emergency happened, and you needed enough money to last several months without a paycheck.

    This is not an exhaustive list, but it does cover some of the main motivations behind pre-paying your mortgage. Remember the amount does not have to be big. You’d be amazed what pre-paying 10 dollars a payment for a year could do to decrease the total interest you will pay on your mortgage loan over time. Would pre-paying be a good option for you?

    Click here to find out more.

    How to Build Your Credit

    On By vmfhomesblogIn Featured, Financial

    Credit. It’s a six letter word that packs a punch. It helps us buy a home, allows us to learn financial responsibility, and sometimes it gives us a little more freedom than we were ready for. If you’ve had a bad experience with credit before – take a deep breath and relax. Your days of fearing a number are over. You are in control of your credit – not the other way around.

    So you’re thinking, “Where do I start?” Whether you have no credit or bad credit – understand that building it doesn’t happen overnight. Just like building anything else, it’s a brick by brick process. Let’s jump in!

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    Credit can be intimidating, but there are plenty of tools that can help you!

    Get organized This is the key. Without it the cycle continues. Buy a calendar or make one just for your bills. This will help you become aware of your due dates so that you make a habit of paying on time. Set reminders on your phone and/or computer. Do all three – remind yourself however you need to. Keep a wall of post it notes with payment dates.

    If you get paper statements—highlight what you owe each pay period. Keep a file folder with “To pay” and “Paid” labels. If you don’t have paper statements—keep up with upcoming payments on a whiteboard. This is the easiest way to tackle debt and stay on track. It’s important. Make a system and stick with it.

    Set your max spending (and stay under it) Credit cards and loans are great—they allow us the opportunity to own something we probably couldn’t before. Yet, they sometimes can feel like free money. Where we get in trouble is when we forget we have to pay everything back—with interest. So how do you control that spending?

    Discipline. Give yourself a ceiling. For example, a card or company may allow $500. Tell yourself, my max is $100 and stick to it. You will still build credit and you teach yourself how to be responsible. Credit is designed to prove you are financially responsible. Use it to learn money maintenance and focus on necessity spending instead of purchasing luxury items.

    Pay your balances in full when you can and maintain only a few accounts.

    Keep up When it comes to your credit and payments—you are your own advocate. Know where you stand.

    Consider getting a secured credit card or becoming an authorized user (Secured /Authorized user) Not all credit cards are the same. So if you struggled with one variety—don’t feel discouraged. There are more options. One option is a secured card. With a secured card you pay a deposit to hold the card. Your credit limit is the amount of your deposit. Essentially, it’s a safeguard should you fail to fulfill your payments. It’s good discipline because then you understand how much money is behind your card, and you have a strong incentive to make payments because you pay into it.

    Another option is to become an authorized user on someone’s credit card. Find someone who is first and foremost financially responsible. The best person to do this with is someone you can learn from. Think of them as a credit mentor who can help you spend well and keep you accountable.

    Start Evaluating Your Debt

    There are many other ways to build your credit. These are just to get you started. Don’t wait.

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    Personal Finance Goal Ideas for 2020

    On By Maggie S.In Financial

    When it comes to financial planning some people want to run the other way, while others make a list that they never apply to their situation. But plans are nothing without specific goals to achieve before that year is out. You’ll find too that even if you’re unable to achieve a goal – you’ll have set yourself up to getting closer to it just by knowing your endpoint and moving towards it. With that in mind, let’s look at some practical ideas that help you move forward.

    Raise your credit score __ points. You decide how many points feel feasible. This goal is helpful because instead of just saying better your credit score – you can measure your success. Don’t know how or where to start? We’ve got you covered with some ideas on how to build your credit.

    Save a certain amount. Pick a number and set up the guidelines of how to reach it. Base it off of your budget and income – don’t reach for something unrealistic, but don’t make it easy either. Have something in mind for what you’ll save. Think something like: saving to pay off a piece of debt, to pay for a home update, to fix a car, to be generous, or to give a special gift. Starting from scratch? Let’s get that budget figured out!

    Pay extra towards the principal of a piece of debt. We all know interest is crippling, right? So, why not try to get ahead of it a little bit? Some loans will allow you to allocate where your money goes. You might try to allocate an extra $50 to your monthly payment directly at your principal. This reduces the overall amount and lessens what you pay interest on. It can also cut time off the life of your loan.

    Write down purchases/ balance your checkbook. Tracking what you spend isn’t a blast, I get it. However, with the digital transformation of our money it’s so important to keep track of where it’s going. Not only is this a good habit to combat over-drafting or cutting it close, but also it can help you realize your spending habits. Sometimes we don’t realize what we regularly spend on that isn’t needed. This is a good place to trim the budget.

    Spend less in one specific category. If you discover that you overspend in one area or you already know a problem area, give yourself guidelines for how to do better in that certain area. Either cut yourself off completely, make a budget for how much you can spend, or make smarter purchases within that category.

    Start with simple investing. Investing can seem hard to get into but there are low-impact things you can do first. Start by researching, asking someone you trust how they invest, or consult a professional. Never make an investment you feel unprepared for.

    We hope that these ideas get you inspired and hopeful about reaching accurate and helpful goals. Remember a step is a step and we commend any progress. Take a step by focusing on your financial planning.

    Get Some Help With These Strategies!

    Why Checking Your Credit Report is the Best First Step

    On By vmfhomesblogIn Financial, Learn

    Honestly, I didn’t care about credit until I went to buy a home. Then it mattered – greatly. Unfortunately, I found it to be true “no credit is equal or worse than bad credit”. It’s a good idea to check out your credit score and report before buying a home. After reviewing your credit report and score, you might choose to pursue a home purchase or you might try improve your credit score first.

    By law, you are entitled to one free copy of your credit report annually from each of the three nationwide credit reporting companies. Unfortunately, some folks don’t know this and end up paying for what they didn’t have to. Also, some websites claiming to sell credit reports and scores are not legitimate. Be sure to check out this site to be sure you don’t get fooled by an impostor website.

    You can visit one website to get your free credit reports from the three major credit reporting companies – AnnualCreditReport.com. You’ll have to input some of your personal info to retrieve your report. This is the same if you call or mail your request. If you create a myEquifax® account, you can get two free credit reports a year.

    Credit reports offer you a lot of details – from debts and when you paid them to old addresses. Plus, things like payments, accounts, and actions within them that you may not know about. That’s why credit reports are always good to look at– because they may show information about potential fraud or identity theft and things that you may not be aware of. This may help you protect your credit score and history by letting you see whether all the information and account details are accurate. Then, if they are not, you can freeze your credit, place a fraud alert, or dispute inaccuracies.

    What you may be surprised to find out is that credit reports do not list your credit score! Weird, huh? You’d think for sure it would.

    According to Equifax®, there are a couple of ways to see your credit score.

    1. You can contact your credit card company or bank as sometimes they may provide your credit score to you as an account feature.
    2. You can purchase your credit score directly from any of the three major credit reporting companies.

    Find More About Credit Scores!

    5 Actions That Will Help You Start Tackling Your Debt

    On By Maggie S.In Budget-Friendly Ideas, Financial, Learn

    Don’t wait for a resolution, a life-change, or more money – create the discipline of paying on your debt now. Even if you can’t pay as much as you’d like, doing the smallest amount and setting yourself up in other areas will make an impact.

    So, we are looking at five practical actions you can start that will put you on the track to staying on top of your debt and ultimately, paying it off. If you’ve been waiting for a sign to start your game plan – this is your flashing neon light.

    Start a passive line of small savings. Whether you’ve been saving or not, always start your seasons of paying with saving. If it’s $5 dollars you save, and $5 dollars you pay – so be it – that’s something, and we aren’t shrugging our shoulders at progress. I favor automation as a way of saving because you can be lazy and benefit from it. Here are some ideas about how to save. You should always be saving. Especially, if you’re spending money. The amount isn’t as important as the discipline.

    Pick a piece of debt that you can whittle down. Now that you’ve created a stream of savings that you can pull from, you can decide what debt you’ll diminish. There are tons of strategies, here are a few to get you thinking. Pick what fits you. I personally like hitting the highest interest debt first. That’s what works for me.

    Outline how much you want to pay off and how much you’ll pay towards each item. Being specific and honest is the best way to confront your debt. Set a goal or goals for items that you want to pay off/ towards. Then decide how much you’ll allocate to smaller pieces of debt – this will differ based on your strategy. It’s important here to consider your season of life. If it’s in your best interest to make big payments towards something – do it. However, if slow and steady is better for you do it. Movement is movement.

    Keep focus. It’s not fun or a good time paying off debt. It can feel easy to cut corners, or stop and wait until another time. However, keep focus and stay consistent. That’s the best thing you can do. It won’t get easy, but you’ll get closer.  You’ll get to a space where you can re-evaluate and focus your goals in more and see what other options you have. That’s one of the best strategies, pay some, zoom in more, and keep repeating until you’re there.

    Follow your budget and make long-term decisions. A budget will help you stay on track. Budgeting your debt and how to pay it is vital. Following a plan will help you eliminate being surprised by numbers. When paying off debt you need to think about the future. Obviously, we can only plan with so much understanding of what will happen. Yet, we can we can do the best we can with what we have. Is your budget non-existent or less than stellar? Read up here on how to start budgeting well.

    These actions are easy ways to being to chip away at debt and make it approachable. If it seems intimidating break it down and keep doing that until it’s in pieces small enough to assess. You’ve got this.

    Set Goals Today!