How To Tackle Back-To-School Shopping Without Breaking the Bank

(This is a guest article by Timothy Ng*)

Heading out to do some back-to-school shopping can really be a drain on the pocketbook if it is not done with a strategic plan in place. The retail shops are counting on the young ones to beg and plead with their parents for the newest and greatest school supplies.

There will be a lot of advertising and setups placed in shops, and if you don't know exactly what you are shopping for, you may be tempted to purchase everything the store says you need.

Back to school with the young ones

Find out what your children really need to go back to school. You can contact the teacher before you head out shopping so that you can get a list of items. You can bring your children with you to go shopping as long as you let them know that you are going to be sticking to the list no matter what.

If you let your children make up the list with you they will be more actively involved in the decision-making and it will be easier once you hit the stores. Don't forget to check what items you already have at home. Your child will probably want all new items, but you can let them know before you go shopping that you do not intend to purchase anything you already have in stock.

It is nice to get your child a few pieces of clothing and a new pair of shoes for back-to-school, but don't go overboard. Once school starts there will be countless sales for clothes that weren't purchased during the back-to-school rush. Do your shopping then to save some money.

Watch the fliers and make a budget

Check out which stores have the better deals before you head out shopping. There may be coupons in fliers for back-to-school items that you need to purchase. You also have to set a budget so that no matter how tempted you are to overspend, it doesn't happen.

Back to school with the older ones

The cost of most textbooks is a nightmare about to happen for college students. The costs on these books can be outrageous so it is wise to look at ways of lowering the price. Here are some helpful tips you can use to keep the price down on textbooks.

1. Look on the Internet : You can do some fast and effective cost comparison shopping on the Internet for your textbooks. You can look at classified ads and bookstores that sell used college books. It is the fastest way to find them used at a good price.



2. Find out if you can use an older edition textbook : If you don't absolutely have to have the latest textbook edition your savings can range from 50% up to 70%. You can e-mail your professor and ask whether or not you need to have the newest edition of the book. Some professors will insist that you get the newest copy while others will tell you that it is not necessary and an older edition will do.



3. Get a used copy from another student : Many students are anxious to get rid of their used textbooks to earn income that they can put towards their tuition for the next year. Try to hunt down former students of the class you are taking and see if they still have the book available for sale.



4. Look at stores that sell used books : There may be a used store that sells textbooks in your area. You can find them in your phonebook or listed on the Internet. Give them a quick call to find out if they have your book in stock and how much it is.

Both younger and older students can save a lot of money when it comes to back-to-school shopping. Setting an example of good shopping habits for these students is an important part of their education as well and will stay with them for many years to come.

*About the author: Timothy Ng lives, breathes, and sleeps personal finance. Check out his in-depth guide to 0 balance transfer 12 months credit cards where he answers everything you need to know to finding the best balance transfer credit card.

*Image Credit: istock photo

Smart Ways for College Grads to Minimize Debt

(This is a guest article by Omar Adams*)

If there’s one thing that most college students are graduating with these days, it’s a mountain of debt. And even though they know this situation is bound to arise when they take out a student loan to cover their tuition costs, they don’t realize that it is compounded several times because of the way they use their credit cards and rack up other unnecessary expenses. It’s not that hard to graduate debt-free or at least with a relatively low amount of debt; the only hitch is that collegians have to plan and execute even before they start their four years on campus. If you’re a high school student hoping to minimize your debt when you graduate from college even as you enjoy most of what college has to offer, here are a few tips that are sure to help:

1. Choose your college with care. Remember, a prestigious name is not going to help you when you’re faced with a mountain of debt on graduation. So unless you want to spend the better part of your adult life slogging away to pay your student loans, think carefully before you make the choice. While you don’t have to go to the other extreme and choose a community college, opt for a university that’s close to home or where you have friends you can stay with. This way, you cut back on accommodation costs. If that’s not possible, choose a degree at a college that’s reasonably affordable and which doesn’t demand that you pay through your nose.


2. Work while you study. College is not all about fun and games, parties and sororities. You need to adopt a more serious attitude if you want to graduate without a care in the world. When you assume responsibility for your debt right from your first year by getting a job that allows you to pay for your extraneous expenses and also settle some of your student debt, you not only prevent your debt from accumulating, you also reduce the interest on the amount that’s outstanding.


3. Use credit cards judiciously. I’m sure every college student has been given this piece of advice; even so, it falls by the wayside more often than not. While I’m not saying you must avoid credit cards altogether, it’s best to use them wisely – charge all your expenses to them if needed, but ensure that you have enough money to cover the entire payment every month on or before the due date. The best way to avoid racking up huge credit card debts is to get a secured card, one where you’ve paid a sum in advance and which is your spending limit. Also, if you have a savings account, tie it up to your credit card and set up an automatic debit facility the day your bill is due. This way, you don’t have to worry about going overboard or racking up a huge interest because you’ve forgotten to pay your bill, and even if you don’t have money to take care of your bill, the amount you paid upfront is enough to take care of it.

*About the author: This guest post is contributed by Omar Adams, he writes on the topic of online accounting degree programs. He welcomes your comments at his email id: omaradams47@gmail.com.

*Image Credit: Photograph by upsuportsmouth [via Flickr Creative Commons]

What Every First Time Car Buyer Must Know

(This is a guest article by William Eve*)

There is lots of info for first car buyers. You might think that the most important things to know before you buy a car are which ones have the best gas mileage or were voted the best in safety standards but that is only a small part of buying a car. More important then the actual vehicle is figuring out how you will pay for it. You might not have thought of it, but if this is your first new car purchase it is quite likely the largest purchase you have made to date. It might also be the first time that you put your credit file to test in hopes of getting a low interest rate and reasonable terms for your car loan.

As this is often a significant purchase in your life it is important to understand how buying a car works and what you can do to get the best deals. The first step is to get a copy of your credit file. All you need to do is contact one of the credit reporting agencies and request a copy of your file. Hopefully you will find that your file is free of blemishes and your score is good. If you have that you will be able to secure a good rate before you go car shopping. This is an important step because you can go into a car dealership pre-financed, knowing what you are able to afford and what rate your credit score entitles you. Usually you can gain this kind of approval online or by visiting your local bank.

Important Info For First Car Buyers

Settle on a price - The first step in purchasing a vehicle is to find the one you want and then settle on a price for it. Most people do not pay sticker price for a car because you can haggle with car salespeople and usually get a much lower price then the one listed on the window. Take into account when you figure out a price that you will pay a bit more because of interest and other fees, this is info for first car buyers that is often forgotten.

Negotiate on financing - Most car dealerships are able to offer financing through an affiliated bank. When you are first taken back to meet with the sales manager he will try to get you to settle for a higher interest rate then you are probably eligible. This is in the car dealerships best interest, but not in your best interest. Keep pushing to get a lower rate until he meets or is less then your pre-approval rate. Even if the car dealership offers the same rate be sure to check on the terms of the loan to make sure getting it through the dealership is the most cost effective.

Look for other ways to negotiate - Many first time car buyers do not realise that the sales price and the interest rates are not the only chances to negotiate. The sales manager will also try to get you to buy things like an extended warranty. Typically the prices for these things are also not set in stone meaning that you can also negotiate them for a lower rate. Do not be afraid to haggle with the car salesman or the sales manager, they expect it and know exactly how little they can charge for any of their products or services. Odds are the numbers are lower then you think.

By taking note of this info for first car buyers you can ensure that you get a great deal. The first step is to arm yourself with your credit rating and find out on your own what kind of interest rates you can get. Do not let the car dealership dictate your interest rates, if you do you will likely wind up spending more then you should to finance your vehicle. As always, work hard to maintain a good credit file so that the best rates and terms are available to you. If you find that your credit file contains negative marks you might even want to work on improving it before you purchase a card. Although it will put off your purchase, improving your credit score before you get a loan can save you loads of cash.

*About the author: This article was written by William Eve who is a regular personal finance writer for Home Loan Finder, a 100% free mortgage comparison and application service. Whether a first home buyer or investor, visit the Home Loan Finder website for more quality information and guides on competitive mortgage products.

*Image Credit: Photograph by cseeman [via Flickr Creative Commons]

Ah, the Financial Implications of a Dreamer Marrying an Uber-Realist...

The other day after a financial discussion with the better half, I couldn't help but think (for the hundredth time), how very different we were when it comes to approaching financial decisions. I am a dreamer. A hopeless, optimistic dreamer who sometimes loses sight of reality completely. The better half on the other hand is a very conservative realist. He is so much "in touch with" reality that, the world's best pliers probably cannot pry him away to fantasy world.

Personal finance is such a personal thing. Every person has a very different level of risk tolerance and a very different approach to finances. Here is a hypothetical, highly dramatized and exaggerated story to illustrate how very different the better half and I are.

If I were in the middle of a desert, and was shown half a glass of water, after a few moments of initial anxiety, I would start dreaming of how great it would be if I could somehow find a way to fill the rest of the glass with water. Heck, while I was at it, if I could only manage to find some lemons and sugar, I could have a whole glass of lemonade. Oh, and if I could just make the whole process repeatable, I could put up a lemonade stand. And I could get so rich selling lemonade to all the thirsty people in the desert!

On the other hand, if the better half were on a river boat and shown a half glass of water, as he sipped it, he would think, hmmm... it's really hot, and the glass is already half empty. The water is going to evaporate soon and we won't have anything to drink. I read some place that the river water has too much contamination and the water may be undrinkable. How much money do I have to buy bottled water? Will my family die of thirst? Maybe I should cut this vacation short and get back to work so I can make more money and have enough to buy bottled water for my family.

We both have a very common end goal - to be comfortably well off, shield our kids from having to live with financial worries and be able to retire without being dependent on anyone for our upkeep. If we can leave something behind for the next generation, all the more better. But the way we approach it is so different.

While these completely opposite attitudes sometimes cause some friction, the fact that both of us are marching towards the same goal helps keep things in perspective. And we tend to balance out each others' over the top attitudes. If it weren't for me the better half would probably be living in a tiny apartment, with all his money stashed under the bed, and be working 23 hours a day. If it weren't for him, I would have probably been one of the statistic that lost the house because I was upside down on the mortgage and didn't have a steady job since I was too busy chasing an Internet dream.

So together we march. To two separate tunes. In the same direction, but on different sides of the road. Someday, one of my eccentric grandiose plans will make us a boat load of money. Until them, I am content to let him guide us using his sensible "get rich slowly" mantra.

Photograph by renatela [via Flickr Creative Commons]

Is Investing in Stocks a Good Option for the Youth?

(This is a guest article by Sharon Smith*)

Investing in stock... sounds scary? Many of us do not have much idea about stocks at all. Especially the youngsters who are just starting out, often inquire about how to start investing. Let’s start out with simple answers to the basic questions.

What is a stock?

A stock is, mostly simply termed, the partial ownership of a company. A lot of companies issue stocks when they plan growth. They sell stocks with the purpose of not falling into the clutches of debts. As stocks are equivalent to ownership of the company, the company is not liable to pay back the stock holders.

Why should you invest in stocks?

The simple reason is, once the company earnings increase, the value of stocks increase as well. Some of the companies pay dividends to their stock holders. Every quarter, companies calculate their profit percentage. Then, they reinvest certain profit amount into the business and pay out the rest of the amount as dividends to the stock holders. For example, if you buy $10,000 worth of stocks, each costing you $10, then you are buying 1000 shares of the company. Now, if the company earns a profit of 25% in that quarter of the year, it might reinvest 20% of the profit back into the business and decide to pay the rest 5% amount as dividends to its stock holders. Thus, you are earning $50. This is a legitimate income that you are earning and it is taxed.

There are usually two kinds of stocks - common stocks and preferred stocks.

Common stock is the ownership of the company in general. The companies offer common stocks through public offerings and tenders. The only obvious risk with common stock is that the price of the stocks fluctuates often. However, the investors can only lose their initial investment in case the stock prices fall.

The preferred stock is less risky than the common stock. Thus, the returns on the investment are also less. However, preferred stocks guarantee regular dividends for a fixed time period. Should the company default on dividend payments, and declare bankruptcy, the priority is given to the preferred stock holders regarding the assets entitlement. Preferred stock generates income for the investors, while raising the capitals for the company.

Start investing now

According to a mutual fund company, T. Rowe Price associates, if you wish to accumulate $1 million by the age of 65, you should begin investing at 25. Starting from this age, if you invest around $3900 annually, by the time you are 65 years old, you will be able to earn a return of 8% per year.

Here are four very important tips that you should keep in mind while considering investments.

1. Investment is not a gamble. It is true that a lot of investors gain and lose huge money in pretty short time. However, you should understand that investing in small amount consistently will fetch you better result by ensuring financial security. Investing is a long term process and you need to leave your money for circulation in the financial market for at least 10 years.


2. Do not consider investment, if you are in debt. Credit card debt is a big barrier towards financial stability. In case of debt, consolidate the outstanding amount and pay off. Do not incur any further debt on your card. It sounds difficult, but once you do that, it would be the best financial decisions that you would ever make.


3. Get insurance first. Insurance is something that most young people do not give much thought to. However, that is a huge mistake. You must have proper insurance before investing your hard earned money. You may never need it, but in case you ever do, you will be glad to have it in place.


4. Have an emergency fund. Emergencies can happen any time and under any circumstances. The biggest benefit of having an emergency fund is it prevents you to withdraw from your retirement accounts. In some types of emergencies like fire, illness etc, waiting periods for receiving insurance benefits might take more than two weeks. If you set yourself an emergency fund, that will keep you going during such crisis periods.

Once you have considered the above points, start investing. Just remember, investing in stocks would combat the risk of living beyond your means.

*About the author: Sharon Smith is a financial writer. She is associated with the Oak View Law Group. She offers advice on various debt management programs.

*Image Credit: Photograph by wonderwebby[via Flickr Creative Commons]

6 Steps to Help Your Child Learn About Money

(This is a guest article by Andrew Salmon*)

Your child is going to have a love/hate relationship with money as they grow to adulthood.

If you’d like to push that relationship to be more about the former than the latter, here are six steps for teaching your child about money:

6. Good Morning, Early Birds

The best way to provide your child with a solid understanding of money and what to do with it, it’s best if you begin early before any bad habits can creep in while your back is turned. From as early as age 3, you can begin teaching your kids about handling money.

5. Make Allowances

There’s no better way to teach a child something than with hands on experience. Providing your child with a weekly allowance gives them spending power. Let them pick out items they want and pay for them with their own money. Have them work around the house to earn the stipend. Pick their birthday as a point for an annual raise.

4. Work It Out

Working around the house is one thing, working a “real” job is something else and the sooner your child gets this experience the better. Encourage them to get a part-time job in their mid-teens so they can learn what working is all about. They’re going to spend decades doing this, so they might as well learn it early while they have a chance to make money blunders that don’t result in catastrophe.

3. Practice What You Preach

Kids learn by example and your child is no exception. They are sponges and absorb whatever they are exposed to. So, instilling good money handling habits begins with the face in your mirror. Practice what you preach. Don’t stress saving and budgeting while displaying some extravagant purchase to the entire household. This will undermine the lessons you are trying to impart. Stick to you own budget, pay your bills on time. Economics Class is always in session.

2. Hold Your Hand Out

Take your child along with you when you stop off at Good Will or the Salvation Army to drop of your unwanted clothes, toys or gadgets. Stress how important this action is for people who can’t buy these things for themselves. Not only will they learn the importance of giving, but explaining the plight of the poor and needy will give your child a solid understanding that no one wants to be poor, that it is a state to be avoided and that through good money management, they can avoid poverty.

1. The Future Is Now

Money tends to burn holes in the Kids’ pockets. But one can at least make an attempt to teach one’s child to squirrel away into a savings account some small portion of their income whether it be from an allowance or a first job. Not only does this exercise stress how important it is to save, but it can also provide them with a nice start up nest egg for when they fly the coop.


*About the author: This is a guest post contributed by Debt Management. It was written by Vancouver based author and freelance writer Andrew Salmon.

*Image Credit: Photograph by kellyv [via Flickr Creative Commons]

Are Prepaid Cards the Right Option for You?

(This is a guest article by David Pratt*)

Recent college graduates and students still in school will now find it much harder to get their first credit card under new Federal credit card rules that went into effect in March. The Credit Card Accountability, Responsibility, and Disclosure Act is meant to protect consumers from unfair credit card billing practices. The law includes rules to help protect people under 21 from going into deep credit card debt at the start of their work career.

The good news is that for many young people, a reloadable prepaid card is a safe and convenient alternative to using a credit card, cash or checks for making purchases and paying bills. Prepaid cards are widely available online or at retailers such as drug stores and grocery stores.

"Increasingly, prepaid cards serve as a powerful tool to encourage financial responsibility for college students," said Kirsten Trusko, President and Executive Director of the Network Branded Prepaid Card Association (NBPCA), a non-profit trade association. "Prepaid cards provide all the flexibility and security benefits of a branded payment card without the risk of running up debt and overdraft charges."

Harder to Get a Credit Card

Under the new rules, people under the age of 21 now have to prove that their income is high enough to make monthly credit card payments. Or, they need a co-signer, such as a parent. What’s more, if you are under 21 and have a co-signer on your account, you will need the written permission of that co-signer to let the bank to raise your credit limit.

In addition, card companies are no longer allowed to market on college campuses. The days of handing out t-shirts, sodas, and posters on the quad in exchange for obtaining filled out credit card applications from students are over.

It’s still possible to get a credit card without a co-signer if you are under 21, but you will have to have a high enough paying job as well as something of a credit history already—through bill payments or a track record of paying a card loan—certainly possible, but out of bounds for plenty of grads, at least in the initial time after graduation.

How Prepaid Cards work

Provided you are 18 and can pass a simple identity check required under the U.S. Patriot Act (which means providing your name, address, birth date, and social security number) it is easy to get a prepaid card. A prepaid card is plastic card that looks like a credit card or checking account debit card. It is issued by a bank and has an account number embossed on the front and embedded in a magnetic strip on the back. It typically is tied to either the MasterCard or Visa debit network. These cards are widely accepted by hundreds of thousands of merchants nationwide and around the globe for transactions such as buying groceries, clothes, gasoline, and eating at restaurants. They can be used in person or online with a signature transaction or by using a PIN number.

But instead of making purchases on credit, you "prepay" for those purchases by putting your own money into the card account ahead of time. Thus, you are drawing upon your own funds rather than borrowing money or paying interest charges. You can add money at a Western Union agent by handing cash to the agent who then for a small fee, deposits that cash into your card’s account. Similarly, you can buy a Green Dot Money Pak for $4.95 and transfer the money from the Green Dot Money Pak into your card account. You can also take advantage of direct deposit to have all or part of your payroll check deposited directly to your prepaid card account. In this way, you can reload your card with funds and continue to use it indefinitely.

When shopping for a prepaid card program, check that your funds are insured under the FDIC program. Under MasterCard and Visa policies you should be protected if your card is lost our stolen. If reported within 48 hours your liability will be limited to $50 under those policies and capped at $500 if you somehow failed to report the lost or stolen card as late as 60 days out. But if you waited longer than that, you could be out whatever amount you had on the card.

Advantage for Budgeting

Prepaid cards do have some fees, which vary from card to card. These typically include an activation fee, a monthly account fee, and per transaction fee. Still, compared to alternatives such as check cashing fees, overdraft fees, and interest payments, prepaid cards can prove cost effective for many people.

A prepaid card can help you track your spending and live within a budget. Like paying for things with cash, you have to have enough money on your card to cover your purchases. You can check your balance and review your transaction history online, via ATM machines, by calling a customer service number, or even through mobile text messaging, with most prepaid card programs.

In today’s economy, more people are limiting their use of credit cards and just getting one credit card with lower credit limits, or favoring debit cards—either check cards or prepaid cards.

*About the author: This guest post is contributed by David Pratt, marketing director for MiCash.net who writes on the topic of prepaid debit cards. You can reach David at dpratt (at) micashcard . com.

*Image Credit: Photograph by jepoirrier [via Flickr Creative Commons]