Personal Finance Do’s and Don’ts
Question about finance
What banks can finance a single family residence under 600 square feet?Hello. I am attempting to buy a foreclosure in San Diego that is a single family residence with a total square footage of 528. I was told it is difficult for banks to finance anything under 600 square feet. The house is in good shape but its tiny. I need financing asap since the bank already accepted my offer. Thanks.
Every single one of us—no matter our location, age, gender, hair color, family background or race—has to manage our personal finances.
For some, it’s an exciting passion, a never-ending game of “how much can I accumulate in one lifetime”.
For others, it’s just part of life, something that needs to be dealt with but doesn’t border on obsession.
And finally, for many of us, personal finance is nothing but drudgery at best and an emotional trigger at worst.
Fortunately, there are a few simple rules that will help anyone stay on track, and reduce the amount of stress involved when it comes to making sure personal finances are well in order.
DO get organized. Even if you’re a “messy”, this Do is crucial. You’ll miss important due dates, pay exorbitant late fees and possibly get into serious debt (or credit trouble) if you don’t have a handle on what you owe and when you owe it. A simple rule of thumb: the messier you are, the simpler your system.
DO draw up a spending plan. Every dollar that comes into your household goes out in one way, shape or form, even if it’s to a savings account. Know where your money’s coming in and where it’s going. Without this information, you can’t possibly make wise financial choices.
Overwhelmed by the thought? Ask a financially responsible friend or relative (whom you trust) to do it for you. You can’t argue with success—and they can help you make the hard decisions when it comes to having to “trim” spending in certain areas.
DON’T cut out all your fun. Decide, along with your family, what’s most important to you in terms of living a happy life. Then divide up your budget accordingly. If your family really enjoys eating out, plan for it. Just keep in mind you may have to spend a lot less on groceries or clothing. If none of us are the same then our spending plans shouldn’t be the same. If you love to read then cutting back on cable TV wouldn’t be a problem. If you love to watch sports, then cutting back on cable TV would be a serious problem.
DO allow impulse spending. Yup, you read it correctly. Unless you plan for a certain amount of miscellaneous, unexpected expenses in your spending plan, you’ll always feel as though you’re blowing your budget when you pick up items you weren’t planning to buy. Just like anything else, give yourself a “buffer”. A side benefit: you get to skip the guilt when you pick up that neat velour Elvis on the boardwalk.
DON’T use your local bank – unless you absolutely have to. Check out all available credit unions first. In most cases, they’ll have better rates and more friendly policies on everything from fees to lending practices. Each dollar you deposit buys you a share, or membership, in the credit union. So instead of being a customer you’re actually a “member”. Like the ad says, membership has its privileges.
DO use a debit card with protection. Before you use a debit card, make sure your checking account is safe in case you lose your card or it’s somehow stolen. Also make sure you have the right to reverse charges in case merchants don’t provide the goods or services you purchased.
DON’T buy a new car. Considering the fact that new cars depreciate thousands of dollars as soon as you drive them off the lot, can anyone explain why buying a new car would be a good idea?
DO run numbers before every major financial decision. Conventional wisdom works—most of the time. But there are always exceptions. For example, in most cases, it doesn’t make sense to borrow from a 401(k). But there are instances where it’s financially beneficial. You’ll hear it preached from the rooftops that you shouldn’t use a home equity loan to pay off credit cards, or that debt consolidation loans are nothing but trouble. But if you’re financially responsible and ran into some tough circumstances, a HELOC or debt consolidation could be a lifesaver. Search online for calculators that will help clarify the situation. Numbers don’t lie.
And finally, perhaps the most important “Do” of all…
DO remember that personal finance is just that—personal. Everyone loves to give advice, and everyone loves to share their opinions. What worked for your mom and dad may not work for you. On the other hand, they probably have years of wisdom you can draw from.
Consider your personal finances an extension of who you are and where you’re going. Study the topic, and take the time to develop your own unique strategies when it comes to saving, spending and investing. During this information age there’s never been a better time to find the facts you need, in record time.
Everyone has finances. Get personal when it comes to yours.
Video related to finance
Yale hosted a panel discussion with Yale Faculty on Understanding the Financial Crisis: The Stimulus, Bailouts and Other Solutions. Panelists included John Geanakoplos (James Tobin Professor of Economics), Jonathan Macey (Deputy Dean of the Yale Law School), William Nordhaus (Sterling Professor of Economics) and Robert Shiller (Arthur M. Okun Professor of Economics). The discussion was moderated by Yale University President Richard Levin (Frederick William Beinecke Professor of Economics).
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Tags: Bloomberg, debt, Debt Consolidation, finances, Self Improvement
Posted on February 10th, 2010 at 1:01 am
Did I miss something? Did you say initally you would give me $100 today and toward the end of your talk, you said you would give me today $105 and I could invest it at 5% rate and earn $110.25. How did you go from giving me $100 toay to giving me $105 today?
Posted on February 10th, 2010 at 1:39 am
my don't would be….don't ever buy groceries or restaurant food on credit because you'll have nothing to show for it but debt, and debt increasing with finance charges.
my do would be keep a budget (make a list of what you owe and what you pay each month and monthly determine how much you've paid toward credit cards and then reduce those credit cards by paying "down" …not off….the one with the lowest balance.
Keep your credit card balances down to half or lower than what they will lend you.
Remember that a credit card LENDS you money, it's not yours, and not yours to keep. It's merely a loan.
.Buy groceries only "once" a month and don't go out to eat and don't add to those groceries during the month. That will keep you and your budget in line.
Cut your expenses where possible, and continue to do that, always.
When you bring something new into the house then get rid of something old so that you won't have clutter. Getting rid of built up clutter is a real pain.
Posted on February 10th, 2010 at 1:53 am
Mate these videos are so much helpfull and very clear to understand, you have a great approach of teaching, well done!!
Posted on February 10th, 2010 at 2:23 am
Hey, this is so cool. Continue making these great videos. I do not know why they are not as popular as all the other less interesting vids on youtube, I mean this often makes me want to say “But this is so simple!”
Posted on February 10th, 2010 at 5:08 am
that’s amasing! thank you very much from argentina and france!
Posted on February 10th, 2010 at 9:09 pm
Really helpful in understanding some of the complex and simple financial terms..
Posted on February 11th, 2010 at 1:17 pm
awesome
Posted on February 12th, 2010 at 7:06 am
I’m in finance 300 right now. thank you!
Posted on February 12th, 2010 at 2:51 pm
man thats clear as crystal, now i understand present and discount value
Posted on February 13th, 2010 at 5:22 am
I’m thinking of majoring in finance. The first thing I dedicated myself to do is look through this entire playlist. I just want to thank you for giving me and everyone else such an opportunity.