Did you ever wish there was some way to get your fashion-conscious 11-year-old to realize all those things she's asking you for actually cost money? Try this activity with your child this weekend, and your wish will be granted!
Take your child on a trip to the mall and give her a task: She can purchase a specific item she's been asking for (a new pair of boots, a gym bag, etc.) with a set amount of cash. She cannot spend a penny more than that amount, and cannot ask you for that item again this season. Tell your preteen that you're only going to accompany him around the mall - you will not tell him which store to choose for making the purchase, or which item to buy. As an added bonus, allow your child to keep any change left after buying the item. The freedom to spend as she pleases will thrill your child, and the offer to keep the change will motivate her to spend as little as possible.
On the way to the mall, give your preteen a quick briefing on what to look out for when choosing the item - things like quality, overpriced brand-name merchandise, hiked-up seasonal items, etc.
Then, as promised, keep your mouth closed as you accompany your child around the mall and watch in amazement as he learns invaluable lifetime skills such as comparison-shopping, saving, peer pressure and more. It all happens in one productive afternoon at the mall!
Have you given your child a budget for a specific item and then watched with pride as he or she carefully calculated every penny to make the perfect choice? Share your success (or your own lessons learned) with us!
I hope you enjoyed the President’s Day holiday. Our kids were out of school on Friday & Monday, so we had a long weekend full of fun times. President’s Day reminds me of tax season. Although IRS technically started accepting tax returns on January 23rd, most of us have not filed because we were waiting for information. Also, some returns weren’t being processed at that time. For example, if you are claiming the refundable portion of the Child Tax Credit or if you are claiming the Earned Income Tax Credit and were receiving a refund, it wouldn’t be paid before February 15th. Now, tax season is definitely here. Unless you are waiting on some K-1s or 1099s, you probably have the forms that you need in order to file your taxes.
I recently attended an 8 hour seminar highlighting the updates for taxes - by the way, that was the short class. The long one was 2 days. Some things in life never change, but tax law isn’t one of those unchangeable things. For this post I’ll mention some of the tax topics that I think the readers here will appreciate. Apply each topic to your situation.
Partnership returns are due on March 15th now, which falls on a Wednesday this year. By the way, whenever a tax filing deadline falls on a weekend, taxes are due on the following Monday. Because April 15th falls on a Saturday and Emancipation day is observed on Monday, April 17th, the tax filing deadline is April 18th this year for individual filers and businesses filing an 1120. (See IRS for more information.)
Tip: If you have some investment accounts, you will want to wait until the final 1099s are sent out. Last year I worked on several tax returns that we thought had the final 1099s, but a few weeks after they were filed, another 1099 was received. Some of these 1099s were not received until mid-March. It is easier, cheaper, and better to wait to file than to amend a return, but returns can be amended. Regardless of when you file, I recommend you prepare the information you’ll need for your return now!
You have until your tax return filing deadline to contribute to your IRA accounts! For most of us, that is April 18th. Each year my husband and I try to reach our $5,500 limit for IRA contributions. Some years we do and some years we don’t even get close, but we aim for it. Having a few extra months helps me. If you haven’t started contributing to an IRA, I recommend you start with a small amount. That’s how we started. How much do you want to contribute before the tax deadline? You need to know this in order to file your taxes. For specifics, check here.
Tip: Always be aware of phase-out amounts. This means that if you earn over certain amounts, the credit or deduction “phases” out until you aren’t allowed any of that benefit. You can look up the specific phase-out amounts for the deduction or credit you may be wondering about. Just because a deduction is generally allowed, doesn’t mean it will be allowed for you. For example, if you are married, the phase-out range for the American Opportunity Tax credit is $160,000-$180,000. This means that as your income reaches $160,000, the credit will ratably be reduced, and if you make over $180,000, it will be gone. I often hear someone say “that is tax deductible” in conversation. I think to myself that it depends on the taxpayer’s income. Student loan interest is tax deductible unless you earn over the phase-out amount. I won’t list all of them here, but you can easily check them on IRS’s website for any deduction or credit that you are considering.
Will you be receiving a huge refund? Emotionally, it feels great to get a large refund. I understand this! I know I’m swimming upstream to suggest that you adjust your withholding, but a large refund means that you are letting the government hold your money. I try to withhold just enough to get a small refund.
Some people tell me that they don’t have the self discipline to save throughout the year so at least that forces them to save. I get that. However, USING your budget will solve this problem, and you can get off that wagon. I’ll get off my budgeting “soapbox” now.
IRS is trying to protect against this. If you want to read more information about possible fraud, click here.
Identity theft is a big problem right now. I personally have a friend who wasn’t able to file her taxes electronically because someone had fraudulently used her social security to file taxes.
This was an important law passed at the end of 2015. Some tax provisions were made permanentsuch as Child Tax Credit, AOTC - American Opportunity Tax Credit, & Tax Free transfer from IRA to charity.
Other tax provisions were extended. For example, the deduction of mortgage insurance premiums was extended through 2016. This is a nice deduction if it applies to you.
The IRS website is a great resource for tax topics. I hope your tax season goes well!
According to ycharts, the average personal savings rate in the U.S. at the end of 2016 was 5.5%.
That is what my family was saving, so we are average savers right now. Savings doesn’t happen without strategy, so this statistic shows we are prioritizing savings, but we can improve this percentage.
Eight years ago, my family had a savings account with a few thousands of dollars in it. We emptied the account in order to pay for a new roof. We saved for a couple more years and then we emptied it again to pay for a fence in the backyard, which we justified as an “emergency.” It felt like we couldn’t get ahead because we were filling and emptying our savings and couldn’t ever move on.
At the same time, I was feeling pressure to save for retirement, vacations, and my childrens' future college and marriages. I wanted the time value of money to be working for us in all of these areas. That resulted in me using that marriage fund for another expense. We only saved a couple of hundred dollars for college, and our retirement savings was minimal.
In 2010, we decided to focus on one savings goal and invest 3% towards retirement. We decided that our first goal would be to fully fund an emergency fund, which we would only use for emergencies. (Home improvements didn’t count as emergencies for us anymore!) About a year and a half into the goal, we had saved ¾ of our goal amount. I felt tired as we hit a savings wall. I started to justify that we had enough saved, but our commitment to this goal helped us to stay focused on it and climb over the savings wall. About a month after hitting that wall, Ty received a promotion and large raise from his employer. This raise was 5X bigger than any raise he had ever received in the past, and it allowed us to reach our savings goal within a few months.
I remember the Magic Eye 3-D images that required me to relax, focus, and disregard all of the distracting images in order to see the 3-D image through the busyness. You have to be committed to finding that 3-D hidden image. That’s what happened when we focused on one savings goal. We were able to ignore all of the busy distractions. We relaxed and focused in order to see the goal realized.
I don’t know who to give credit for the term “savings snowball.” When we were going through our Savings Attention Deficit Phase, I knew about the debt snowball. This focused on paying one debt off at a time while paying the minimums on everything else, and I thought it would be great to do that on the savings side so that we could avoid debt. I googled “savings snowball,” and found the phrase several times, so I wasn’t the first to coin it.
Think about how we make snowballs. My kids have been making a lot of snowballs. They can make a lot of little ones for a snowball fight, but to make a snowman, they have to focus on one and roll it until that snowball gets bigger and bigger. Pretty soon, we have a large snowball to use to build the base of a snowman. Once the snowball is big enough, we can move to the next snowball, which doesn’t need to be the same size as the first. We decide how big it needs to be, and then we roll it until it gets to be that size.
We started doing this with our savings. After saving for an Emergency Fund, we saved for a trip to Disneyland, which was a much smaller goal that we reached quickly. Then we saved for a minivan. Now we are saving for an SUV to replace my husband’s SUV. The savings snowball has worked well for us because we see progress in reaching our goals in a relatively short amount of time.
This method also helped me relax and focus. I don’t goal hop anymore or try to do everything. The percentage of our income that we saved has changed. We started with about 5%, and each time we got a raise, we put it towards savings until we were saving 20%. Then, with our job loss, we weren’t saving at all for a short time. Then, once again, we started saving 5%, which is where we are now.
Look at your budget to determine what percentage number is right. As you free up money by reaching your savings goal or increasing your income, you can add to that. What other savings strategies have helped you?
Creature comforts like smartphone bank deposits are nice, but how much are they costing you? Your statement might not show the costs directly, but there’s an old adage about situations like this: If you’re not paying for a service, you’re not the customer. You’re the product. In this case, corporate banks use slick technological bells and whistles to get you in so you’ll be more likely to take out loans and use other for-pay services.
If you’re tired of being treated like a product, you’re not alone. Last year, 2 million people between the ages of 18 and 35 joined a credit union. 28% of credit union members are under 35 while 54% of them are under age 50. The tools of technology are making it easier to see the value that credit unions offer.
Don’t just take our word for it. Do your research and see for yourself how credit unions compare to for-profit banks. Consider these five categories:
Here’s a fun game. Call a corporate bank with a simple request, like checking the balance of a savings account. Count the number of irritating phone tree menus you have to sift through before you could talk to a real person who could answer your question. You win when you get frustrated and slam the phone down in anger!
For-profit banks have earned a reputation for cumbersome customer service and out-of-touch policies. Getting information on financial services, like credit repair or auto loans, means sitting on hold for hours. Credit unions, on the other hand, provide easy-to-use services and real, live human beings who can answer questions, make recommendations and help you understand the complicated world of finance.
For-profit banks answer to corporate owners. They expect a predictable, stable rate of return on their investments. This demand puts a straitjacket on lending and ensures those practices never deviate from a pre-determined formula. Take income, multiply by credit score, divide by 2, that’s the interest rate they’ll charge.
However, let’s pretend you just got a new job, so last year’s tax returns aren’t a good indicator of how much you are earning. That’s not in the formula, so it doesn’t matter. Credit history ruined by an old medical bill? Corporate banks stop reading after the first three words of that sentence. In short, there’s no room for flexibility and interest rates tend to be much higher.
Credit unions are community institutions, so helping people out is part of what we do. Our rates tend to be lower than those of corporate banks. We also tend to be more willing to make exceptions for details that may not be reflected in the conventional lending formula.
In the wild west days of the Internet, only corporate banks could afford online banking. Now, your pet gerbil can have his own website. The Internet is everywhere and credit unions are on board. The services you use every day, like online bill pay, direct deposit and checking on account balances are just a click away. Follow this link to learn more about the mobile banking that Wasatch Peaks offers.
Most people don’t handle paper checks anymore, so banking from the computer or mobile device is all most consumers really need.
Corporate banks have historically made a killing by keeping people in the dark about their practices. Credit card companies made it hard to tell exactly how much interest you were being charged. Banks charged overdraft fees without ever telling you they were doing it. These things got so bad, Congress took action. Consumer ignorance was built into the profit model of big financial institutions. Educating consumers was not just a waste of money to them, it was actually costing them business.
Credit unions are not-for-profits that want to make their communities a better place. Wasatch Peaks donates thousands of dollars and volunteer hours each year to our community. Part of the mission of making our community a better place includes financial education. If you need advice about home-buying, making a budget or using credit responsibly, Wasatch Peaks will be happy to help. We also have a blog called "Peaks Financial Fitness" that is published every Monday. It relates everyday topics to finances in a way that is applicable to almost all lives.
Credit unions work for their members. We pay back the money they make to their members in the form of dividends. Since our members are also the people paying for their services, we don’t have much of an incentive to charge an arm and a leg in interest and fees.
Wasatch Peaks Credit Union offers competitive rates on savings accounts and CDs/certificates. Because we don’t have to siphon off money to pay shareholders, we can return that money to their investors: you know, the people who do their banking with the credit union. Compare the earned interest on a credit union checking or savings account to those offered by a for-profit bank. Then, go open an account at a credit union, like Wasatch Peaks. You’ll thank yourself later.
Over the weekend I bought Valentines for my family. Those are the first of the many gifts that I will buy this year. Budgeting helps me enjoy gift giving and helps me give more meaningful gifts.
The budgeting category of gifts can be challenging. It really is a subcategory that requires more planning. It’s not like my phone bill category that I allocate money and then pay it. Gifts need their own detailed plan within the budget plan.
Gifts and I have a love/hate relationship. I love giving gifts - especially when I find the “perfect gift” that will mean a lot to the person who is receiving it. Long before the Internet, I remember ordering gifts by phone. My sister and I were watching TV and saw an infomercial for a classical rock CD. She got excited and said she wanted it, so I sneakily wrote down the phone number and ordered it. Her eyes lit up when she opened it. That was so cool! I also love receiving gifts - especially surprises. I hate when I feel obligated to give a gift and can’t find one. In the past, I felt like I need to give someone a gift at Christmas because they gave me one, instead of graciously accepting what they gave. I’m trying to eliminate giving out of obligation, but I admit it is still a struggle.
Budgets make gift giving fun because it helps you avoid feeling regrets or other bad feelings. Here are steps to create your giving plan for this year:
Leave some flexibility in your gift budget. I’ve realized that there are some gifts that I’ll want to give that I can’t predict. I leave some flexibility in my budget for the baby showers, wedding showers, and graduations which will inevitably come up. We budget $20 a month to our miscellaneous “giving” category, so that we have some flexibility to give. Including this has been key to our gift budget.
Personalize your gift giving category. Make it work for you. When I give small gifts like the Valentines that I bought, I include them in my groceries. I keep it simple if it is minor, but for big gifts, I plan them out. There is no right or wrong way as long as it is your way! Just figure out what your way is. I learned to do what is right for my family.
Around our 10-year anniversary, I started to feel pressure to go on a big trip. When I thought about why I felt that way, I realized it was because my cousin and his wife had just posted pictures from their 10-year anniversary trip, but we didn’t have the money budgeted for that and didn’t even really want to do that. So, we didn’t. It’s cool that my cousin wanted to do that and had a great time. I was able to feel happy for them and feel content that we didn’t spend money we didn’t have on a trip we didn’t really want to do. By personalizing your gift budget, you give the way you want to give and can feel content.
Plan to save for the gifts that you can predict. Many of the big gifts that we give are predictable, like Christmas and birthday gifts. All of my family’s birthdays fall in the first 7 months of the year. I like this, but I have to plan for it. Some years I save throughout the year for birthdays and Christmas. This year, I don’t have the money saved, so I’m budgeting birthday money for the first six months. My husband is paid bi-weekly. I figured out when the 3rd paychecks of the month will fall, and designated those to go towards Christmas this year and birthdays for next year.
There are a lot of ways to save for gifts. Look at your personal situation to figure out how to save for those. Would it work best to put it all away at once or save every month? If you are self-employed and have a busy season, it could make sense for you to save for all your gifts during that time. Wasatch Peaks has a Christmas Club Account and Budgeter Accounts that could be a great tool to do this. I have used a spreadsheet or budgeting software to make electronic envelopes and set aside the money for birthdays so that I don’t spend it. Thinking through these details has relieved so much stress.
Don’t just give because you feel obligated. When I do this, I feel bad afterward. My mother-in-law asked us not to give her anything for Mother’s Day except a homemade card. This was very hard for me because I love her so much and really wanted to give her a gift. She knew this and told Ty that she would be mad at me if I did something. I learned a lot from this. If we can think of something she would enjoy, like pictures of our family, we give them, and she graciously accepts them.
Express love through gifts. We can’t buy love, but we can buy gifts, and if done in the right way, they can help express love and strengthen relationships. When we were dating, Ty made me a DVD with songs to go with it. He also gave me a watch. The DVD meant a lot to me because it was so thoughtful. And after 15 years, I still have the watch (it just needs batteries). These are gifts that last. Since that time, I remember only one other Valentine's gift. Instead of focusing on Valentine's Day, we try to show love all the time. It’s so fun to pick up a favorite treat for my husband while I’m at the store. We aren’t anti-Valentine's Day - if you buy the heart balloons, big stuffed teddy bear, and heart shaped chocolates, that’s cool with us! My husband has gone to Walmart the night before Valentine’s Day for entertainment. He loves to watch dazed shoppers searching for a gift.
Give what you can afford to give. Often, the best gifts are the gifts that mean the most to the receiver. These gifts are heartfelt, and not because they are expensive. They are often super simple and cheap, but require understanding what would mean the most to the receiver.
Almost 2 years ago, I attended a youth conference with a group of youth and adults. We got to know each other really well on that trip. One of the leaders served as our cook. At lunch time one day, he found out that I love eating the ends of the bread. On the way home from this youth conference, I found out that my husband had be fired unexpectedly and without cause. This was an emotionally hard time for us. We really needed support as Ty & I clung to each other and our young family. One morning soon after, I opened my door and on the porch was a bag of bread heels! I knew who had left them. I’m sure that this unconventional gift that didn’t cost much more than the trip down to the bread store. Most people wouldn’t get emotional or appreciate a bag of leftover bread heels, but that gift is one of the most thoughtful, unique, and meaningful gifts I have ever received. Tears come as I think of the kindness of that dear mentor!
Gifts can be a major or a minor budgeting expense. It’s up to you! Budgets are personal. You can make your gift budget as small or as large as you want it to be.
I have received a lot of gifts over the past 4 decades and I really appreciate those gifts. Budgeting has improved my gift giving! It makes it less stressful and more fun. The work it takes to create gift budgets has been so worth the reward.
In 2006, my sister got married. On the day before the wedding, I was asked to run a few errands to pick up some last minute items for her reception. I bought some music. I also bought a cardboard cutout of President Bush (which we turned into a cutout of my brother who was unable to attend). Lastly, I bought some decorations. A few days after the wedding, I checked my account and saw THREE overdraft fees for $25 each, which totaled $75. When I had made those purchases I knew that I had money but didn’t realize that it was in our savings account and not our checking account. The overdraft fees cost much more that the items I purchased.
First is to plan (aka budget) for parties. Because it was my sister’s wedding, I really hadn’t planned to spend money besides her gift. By planning, you can avoid costly fees and spending hangovers/aches. It was nice of me to want to help out and run the errands for my mom who was very busy, but I should have made sure that I could afford them or honestly said that I couldn’t.
If I could afford them, I needed to make sure that I had the money in my checking account. The items I bought were not that important for the party. We could have gone without them or my mom could have paid for them.
Secondly, I learned that mistakes can teach us. I haven’t had an overdraft charge since that day over 11 years ago because I decided that I would never let that happen again. At the time, it seemed like a very expensive mistake, but looking back, it was a cheap mistake that has saved me a lot of money because I decided to change. This mistake inspired me to become a budgeter.
Although I’m not perfect at budgeting, I have improved so much. Parties are all about celebrating something: life, friendships, and accomplishments. I don’t want the celebration to leave me with regrets. When you follow a budget, you enjoy the party before, during and after. By sticking to the plan, you feel like you do after a workout - you feel good.
For example, a wedding budget could be $5,000 or $20,000. If you have a large budget, you can do an expensive party. If you have a small budget, then it will be a less expensive one. Both can be great, but the budget will determine the party. By spending what you plan to spend, you feel less stress and can really enjoy the experience and the memories which come out of it. I’ve been to wedding receptions that were expensive and some that were not expensive. Both were great because they were what that couple wanted. Some of my favorite parties have been the inexpensive ones. The memories made were priceless.
I’m not much of a partier. It’s probably because a lot of parties involve late nights and I like to go to bed early, but if you are a partier that is great. I saw a commercial for the upcoming Super Bowl parties. If you are a fan, you are counting down the days to watch the Patriots and Falcons face off in the Super Bowl this year. You might be planning how you’ll cheer on your team.
Answering a couple of questions will help you decide the best way for you to plan the finances for your parties.
Parties are a great way to enjoy life and make incredible memories. Budgeting for these parties will help make them successful and allow you to party on without regrets!
It’s almost Valentine’s Day, and that means it’s time to start planning something special for that special someone in your life. Having the perfect night out doesn't mean you need to break the budget. Here are ten low-cost Valentine’s dates you can use to give your sweetheart (and your wallet) a great time!
Food is love. It’s one of the most traditional ways to show you care. Paying restaurant prices for it, though, can add up fast. A typical meal out costs an average of $13 per person, excluding tip and drinks. Worse yet, unless you act quickly, getting a table on the 14th may be a non-starter!
Instead, try making a meal yourself. For added fun, try cooking together! The meal will taste better with the knowledge that you made it yourself, and you’ll save the time and expense of going out to a restaurant. Set the ambiance with some scented candles and soft music, and save a bundle!
Get yourself a great workout and havee a fantastically fun date by going ice or roller-skating! It’s a chance to be close together and hold hands! Best of all, costs are low, so it’s a bargain-priced way to build memories. You’ll form lasting memories from the bumps and scrapes of falling down, and picking each other back up again will bring you closer than ever.
If you are going out to eat, make sure to check Groupon, LivingSocial and RetailMeNot for deals on restaurants near you before making reservations.
Instead of buying a pricey piece of jewelry, frame a nice picture of the two of you or write a meaningful card.
It may be cold out, but you can still have fun just enjoying the fresh air. Bundle up and take a refreshing walk under the stars. Or, if it's snowy out, build a snowman! Then, go home and warm up in front of the fireplace with steaming mugs of hot chocolate.
Get cultured on a budget by taking advantage of a local museum's free or discounted rates at specific times or nights.
Somewhere between dinner at a restaurant and home cooking lies a pre-packed meal you can take with you to a special spot. Scope out some place with a view, then pack up light fare – sandwiches, cheese and crackers, or even just some fresh fruit. Pack up your blanket and your basket and grab your sweetheart.
Movies have always been a traditional date night trope, but a new release at the theater can cost a pretty penny! If you look, you can almost always find a nearby theater playing slightly older movies for dirt cheap prices. You can get the whole theater experience, down to the shared bucket of popcorn, and see a good movie you’ve both been dying to see!
Have a rollicking good time at the neighborhood comedy club. Entrance tickets can be as cheap as $5 apiece!
Find a new skill or activity you want to find out about and take a class together. Many communities offer cooking, dancing and other romantic activities, but learning to play a sport or a fitness class could be a great fit, too. Whatever you choose, be sure it’s something just outside both of your comfort zones! Nothing builds relationships like shared experiences.
How do you save on a date without compromising on the quality of the evening? Share your best tips with us in the comments!
With snow piled taller than me, it’s unthinkable that someone would wait in line for two hours to play in the snow. But, my sister and her family went to a Winter festival in Houston, Texas, and the city had hauled in a load of fake snow for it. There was a long line of Texans waiting to play in the “snow.” Being from Utah, she was amazed. Her kids wanted to wait, but she couldn’t make herself wait in a line for two hours for fake snow. I wish I could mail some of Utah’s snow to my Texan nephews. We are running out of places to put it.
I’ve lived my entire life in Utah. For quite a few winters I took care of babies, and we hibernated. I took the snow for granted. A couple of years ago, I decided we would dress warmly and start adventuring out into the snow. I wanted to enjoy the winter too.
Last Saturday, my family went to the Winter Festival at Wasatch Mountain State Park. After receiving six inches of snow that morning, it was the perfect day for a party to celebrate winter. We went cross country skiing for the first time. Snow shoeing and riding snow bikes were also available. Lunch was provided. The whole event was free for us. The only thing that we had to pay for was transportation to get there. Utah has 43 state parks, so if you are looking for a staycation or a day trip, state parks could be a good fit. The fees are low at most of the state parks. We bought an annual state parks pass $75 ($35 for seniors), and it has been well worth it.
To find out about upcoming activities, you can check out the Utah State Parks website. This year is the 60th anniversary of the state parks. Each week there will be some activity at one of the parks to celebrate. There will be “hiking, fishing tournaments, dances, winter festivals, and more!” We were told that each state park has its own mailing list, which is how we found out about the Winter Festival. Iif you are interested in a particular state park, you can ask to be put on their email list. There are two Winter Festivals this weekend! One is at East Canyon and one is at Bear Lake.
Over New Years we went to Zion’s National Park and saw tourists from all over the world. This made me realize how neat our Parks are and gave me the desire to go to them more often. Because they are so close, sometimes I take them for granted.
Staycations and day trips are great and Utah has so much available, but kids grow up. I want to do a big trip to Disneyland and San Diego. My sister’s family just moved to Alaska. I miss her, and I want to visit them. She’s very adventurous and has found so many beautiful and adventurous activities in Alaska, which we would like to do. We also are planning a trip to Spain in a few years.
While growing up, my husband’s family didn’t take expensive trips. They loaded their family in a Volkswagen Rabbit and went camping. My husband loved it. He didn’t feel deprived. He is content taking camping vacations. Their family lived debt free.
My mother-in-law is one of the wisest women I know. So, I asked her if she would do the same kinds of trips that she did having the perspective that she does. She said that she would see everything close in Utah, but she would also put a few dollars away each month to be able to go on a neat big trip every few years. She would still pay for them in cash, but she would prioritize doing some trips that are important to her family. She regrets not doing a few more big trips.
Personal Finances are just that - PERSONAL and INDIVIDUAL. Which means that budgeting is not just mathematical, it’s emotional! The emotional aspect of personal finance can be the hardest part. It requires self-discipline, focus, and delayed gratification. It’s an emotional struggle to delay gratification! With our budget, we plan to enjoy staycations and day trips at Utah’s many state and national parks, but we also look forward to big trips that are important to our family.
Q: Winter is here in full force! Every time the furnace kicks on, I feel like it's burning up money! How can I keep my house cozy while keeping the heating costs low?
A: There's nothing better than being toasty warm when it's cold outside. Unfortunately, keeping your home at a comfortable temperature isn't cheap. Heating a house can easily eat $300 out of your monthly budget, depending on where you live and the thermostat setting.
If you're looking for ways to save money, check out these five handy tips for cutting your heating bill this winter.
Part of the challenge of heating a house is heating rooms that no one's in. If you've got a guest room or office that no one uses, all the hot air you pump into it is flowing right back out again. Shutting the doors and closing off the vents in those rooms could save you some green.
On the other hand, if you've got rooms that see regular use, it might be more cost effective to heat them with a space heater. That way, you can keep the thermostat low and still be warm in the rooms you use. This can knock as much as $20 a month off your heating bills!
Long before the days of forced air furnaces and radiators, people stayed warm using solar heat. Sunlight streaming through the windows can raise the temperature and make it feel warmer. To do this right, it takes a little bit of timing.
Using thick, insulated curtains helps keep warm air in, but also keeps sunlight out. Open those curtains while you've got exposure, then close them once the angle of the sun has changed. That way, you can trap as much of the free solar heat as you can.
Heat gets out through holes in walls. If you actually have holes in your walls, these should be your first priority. But, for most of us, those holes are a little less obvious. Windows and doors are the first culprits. An inexpensive window treatment kit, available at most home improvement stores, can help stop heat loss through windows.
Doors are trickier. If there's a patio door or another entrance that you use less in the winter, consider putting a blanket in front of it to stop drafts. You can also check weather stripping around the doors, as this can deteriorate quickly.
One hole most people don't think much about is the chimney. The only thing between your home and the outside is a sheet of metal, which is a very poor insulator. Installing glass doors, a $200-$300 solution, can save as much as 2% on your energy bill. If you're feeling crafty, a square of foam over the front of the fireplace can accomplish similar results, although it will render the fireplace unusable.
One of the worst wastes of utility spending is heating a house with no one in it. The same goes for maintaining daytime temperatures when everyone's snuggled up in blankets. Turning the heat up and down all the time can get cumbersome. Fortunately, modern technology has made it much easier.
Programmable digital thermostats will let you warm things up in the morning, ease off at night and avoid running the heater unnecessarily during the day when you're not there. The units themselves are relatively inexpensive, at around $25. Installation can be tricky, but the savings are worth it. The EPA estimates a household can save almost $200 per year with a digital thermostat.
Proper airflow is essential to a properly functioning heating system. Anything that blocks the flow of air makes your furnace work harder, costing you money! There are two primary points of blockage: vents and filters.
Cleaning vents can be part of the ordinary process of dusting. It doesn't take any extra time at all to wipe them down with a cloth while you're already cleaning. Replacing the air filter in your furnace is also relatively simple. It only needs to be done every one to three months, depending on your use and air quality.
How do you keep warm when the weather's cold? Ugly sweaters? Imagining a beach? Share your best tips with us in the comments!
Saving money can be difficult. It’s easy to have self-control at home, when you’re setting up your budget, but it can be much trickier to have that same self-control when you want to grab dinner out after a long day. Or maybe you see a sale on sneakers and your old ones are just getting so ratty and you think you’d definitely exercise more if you had good sneakers. And just look at them, they’re amazing!
The “52-Week Savings Challenge” is designed to make it easier to save. The idea is simple: Put away $1 the first week, then $2 the following week, followed by $3,, and then $4, all the way up to $52 the final week of the year. It might not sound like much, but if you follow the plan, you’ll save $1,378 over a year. Think you can handle that?
If you’re interested in following the calendar, you’ll need to prime the pot with a few dollars for the weeks you missed to start the year. If not, you can start in the first week of February (or whenever you’re reading this, there’s no time like the present!), which might be even better considering you won’t be trying to save the largest amounts at the same time you’re spending on last-minute holiday shopping. On the other hand, you could always use this as your holiday spending war chest.
We’ve got a guide appearing below to show how much you’ll need to save. We used Fridays for three reasons: First, because many people get paid on Fridays; second, because no one wants to take money out of their wallet on Mondays; and third, because there are 53 Fridays in 2016, so you can save extra money, or miss a week without ruining the program.
There are three main weaknesses to the 52-week savings challenge. First, the money people save on this challenge tends to go into a jar somewhere. While the people who finish the challenge talk about the advantage of seeing their money in cash, which helps them stay motivated, the idea of $1400 sitting around the house is unnerving. It’s not earning interest and it’s begging for something bad to happen to it. Second, remembering to put away money every week can be a chore, particularly if you’ve got to look up how much you’re putting away every Friday, getting cash, breaking a big bill…wow, that sounds exhausting. Finally, the challenge is designed in such a way that the final three months can be pretty tough: you’ll need to put away nearly $50 per week for the last 14 weeks, which can be a tall order.
Wasatch Peaks can help with all of those problems, though. First, let’s earn some interest. We’ve got a ton of great savings plans, but if you’re just getting started with saving, they can be a little confusing. For a plan like this, in which you’ll be making regular deposits with a low balance for most of the year, and then withdrawing it eventually, you might want to try one of our interest-bearing Christmas Club accounts. Your money will make money, and you won’t have a jar of cash in the house.
Next, let’s make it simple. Obviously, the simplest thing to do is to set up direct deposit into your savings account, Christmas Club account, or other savings program. Unfortunately, the 52-week challenge makes that tough, because the amount you save changes every week. One possibility is to take the average. If you deposit $27 into your savings every Friday, you’ll end up with the same amount at the end of the year as the 52-week challenge. It’s not as interesting or fun that way, but you can set it up today and forget about it. You can also make monthly deposits of $120 to reach your goal, or take $54 out of every paycheck if you’re paid biweekly.
Finally, we need to deal with the end of the year problem. It can be extra tough to find money to save in December, and to make matters worse, back-loading the plan really hurts if you give up on it before it’s over. If you save diligently for nine months before getting distracted or receive a surprise bill that derails you, you will only have saved about half of what you planned, even though you worked for almost the whole year. The previous solutions we offered, the Christmas Club account and direct depositing the average amount help somewhat, but they take some of the fun out of the game.
Here’s an idea that keeps it fun, avoids the end of the year jam, and lets you earn interest: First, you need a list of the various amounts you’re going to save. You can print our chart really small, keep a spreadsheet on your phone, or just take a note card and write the numbers 1-52 on it. Then, whenever you make the choice to save money, you transfer that amount online or on our app (If you don’t have our app, check out our Peaks Mobile Banking™. Click here for Apple® and here for Android™) and cross off that number. At the end of the year, you’ve got to cross off all of them, so it becomes a real challenge. Gotta catch ’em all!
If you’re planning on trying the 52-week Savings Challenge, let us know. You can follow us on Facebook, Instagram and Twitter, then tell us what you’ve done to cut some fat out of your budget. Our members would love to hear your tips, and you might get some good ones from them. Members helping members!
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