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What do you do when you receive a tax refund, bonus, raise, or other lump sum of money? Do you pay off debts? Do you save it for a rainy day? Do you sit on it, thinking, “I don’t know what to do with it, but I’ll figure it out,” only to wind up spending it all, one small piece at a time?
Today I took Nancy’s question about how to distribute money from a raise through her monthly budget. I also listened to what you had to say about how you manage your chunks of change. I explain my decision-making process for applying extra funds to debt and to other financial goals so that you never have to worry about wasting it.
Today’s Mentionables:
Financial Freedom Steps – simple road map to help you make confident decisions with your money
What do you do when you receive a lump sum of cash? Do you put it in your checking account until you make a decision only to find it slowly whittles away?
Or, do you throw it all at outstanding debt?
Or, do you fix things around the house and with your car that you’ve been putting off?
What do you do with tax refunds, bonuses, raises, and other lump sums of cash?
Last week, I talked about the importance of preparing for vacations and travel so summer trips don’t follow you home. It got me thinking, though: summertime ushers in all sorts of expenses that aren’t typically found on the budget throughout the rest of the year. How are you preparing for them?
Aside from a summer vacation, many of us will travel for a wedding in the coming months. Taking the same approach with planning for travel – including transportation, food, lodging, and other costs in the equation – you also must determine how much you’ll spend for wedding gifts. I suggest standardizing your wedding gift spending with one dollar amount for all weddings and an option to scale that amount down for the weddings of couples you might not have a deep relationship with.
Memorial Day marks the unofficial beginning of summer, Labor Day marks the end, and Independence Day falls in between. If you’re planning any neighborhood parties, be sure to plan for the additional grocery expenses you’ll have. Likewise, if you have any annual family reunions during these holidays, remember that you can plan for that all year long by dividing what you would spend by twelve and saving that money every month.
If you’re planning to do any extensive yard work or home improvement projects this summer, be sure to plan accordingly. Rather than fall for a 0% interest credit card at your neighborhood home improvement megastore, begin setting aside money now for the projects you’d like to accomplish. Even if you have to wait until the fall to get started, you’ll avoid the debt trap to-do lists can snare us in.
And don’t you just love back to school shopping? Ending the summer with clothing and school supply purchases can put you on unstable footing as you head into the fall. What can you save over the summer months in order to be prepared for that shopping spree? What can you wait to buy after school begins?
A little bit of forethought and a good monthly spending plan will help you manage your money and avoid the financial dog days of summer.
How you prepare for travel and vacations can make or break how you achieve other financial goals. Here are a few ideas to plan your vacations so you remember them with smiles, not frowns.
[Audio clip: view full post to listen] Past Due: Radio 106 – Saying No in a Yes World Right-click to download Send me your feedback or leave me a voice mail: (919) 374-0501. Leave a review on iTunes What is it about Americans that we have such a hard time saying “No”? Today we talked [...]
[Audio clip: view full post to listen] Past Due: Radio 105 – The Great Checking Account Debate Right-click to download Send me your feedback or leave me a voice mail: (919) 374-0501. Leave a review on iTunes Today was a mailbag and listener feedback day! I fielded questions on all manner of financial subjects. Past [...]
Long ago, in a galaxy far, far away, there was a time when people actually saved money. Indeed, they would take a certain portion of what they made from their income-producing jobs and hold it for later use. What were these crazy people thinking? How different was their society compared to our own? A tremendous [...]
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Once upon a time, people would go to work for a company for many years, retire with a nice pension and health care benefits to last the rest of their lives. Once upon a time, kids could go to college without incurring mortgage-sized student loans. The good ol’ days. “Sandwich Generation” is the term used [...]
