Articles in the Personal Finance 101 category

  • Great Tips to Save on Rent

    Rent will probably be the single biggest expense in your weekly budget, and it is of a high priority too – after all it is providing a roof over your head. However, while there is no doubt you have to pay your rent, there is nothing saying you have to accept the rate you are being charged without questioning it, because there are ways you can make your rent more affordable, and bring it into line with the current economic situation of your neighborhood.

    To save money on your rent each week, consider implementing these tips:

    1– Know the competition

    The rent you are paying should be on par with the amount being paid by those renting similar properties in your area. Therefore, ask around to find out what the rental rate is, and try and find out the credit score and income of your neighbors too, as your ability to make your rental payments and your level of risk will impact on how much you pay each week.

    Also research the demand for rental properties in your area, because when there are a lot of empty properties you are in a position to demand a lower rental payment each week, because your land lord will want to fill their property any way they can. If you already have a rental property then look at how many apartments or units are empty in your block, and start haggling with your land lord or property manager over the rent, threatening to leave if they don’t compromise.

    2 – Contact your property manager

    Deal directly with the property manager when you are negotiating the price of your rent. This will ensure you are talking to someone who is in a position to offer you a discount, and someone who is directly affected if you choose to leave and look for a better deal. Therefore, when you ring, ask to speak to the most senior person in the organization.

    3 – Write a letter

    If you do want to talk to the manager or supervisor at the top about your rent, you may be asked to put your request in writing. If you do write a letter, make sure you include the following information:

    • How long you have been living in the property.
    • The property values in the area, highlighting where they have decreased and especially the decrease in value of properties like yours.
    • The vacancy rates for rental properties in your area, or the number of empty apartments or units in your building or block.
    • Your income and credit score to show you are not a risky tenant.
    • The high condition you have kept the rental property in while you have been living there.
    • A comparison of rents for the same or similar properties in your area.
    • Request a discounted rental amount and don’t be afraid of going too low.

      4 – Work around the apartment

      All buildings need maintenance work completed every now and then, and usually the building supervisor will bring in maintenance workers to complete these jobs. However, if you volunteer to do these jobs around your building you can save the body corporate some costs, and it just costs you a little time. You are then in a position to request a discount on your rent in return for this maintenance assistance, and make sure you point out the savings you are securing for the building. You may even want to volunteer to be on call in case there is a problem with the building, and this will put you in a favorable light as land lords and property managers always benefit when their tenants care about the property.

      5 – Rent the right place

      You can start saving rent right from the beginning by choosing the right property for your needs. When you are looking for a rental have a clear picture of what you need, and be willing to compromise on what you want – for example you may have to sacrifice that spare room and have your sister sleep on the couch when she visits twice a year, or live a little further from work to save on your rent.

    Also take the time to shop around so that you can get an idea of what the rent should be for the type of property you are looking at, and the area you are looking at. For example, if you find a rental you are interested in, make sure you look at two other similar properties in the area, and a real estate agent can help you with this search.

    6 – Share the rent

    If you are willing to compromise some of your personal space, then you can cut your rent in half or third by taking on a roommate or two. Your roommate could be someone you work with, a friend, or you can put an ad in the paper, just make sure that you do a thorough background check on your potential roommate to make sure they have the financial ability to pay the rent.

    7 – Don’t pay for additional services

    Make sure you are not paying for additional services with your rental property that you don’t need. For example, there may be car cover charges which you don’t need to pay because you don’t have a car. You will have to read your rental contract carefully to make sure you understand all aspects, and know exactly what you are paying for.

  • 3 Big Credit Card Mistakes to Avoid

    There are many benefits to having a credit card. Some can help you to establish a good credit score, offer rewards on transactions or help you to spread the cost of a large purchase.

    These benefits are often what attract customers to credit cards in the first place. However it shouldn’t be forgotten that the success of them largely depends on how well they are managed. A well-managed credit card can be very beneficial to your finances whereas a poorly managed card could cause financial problems.

    Throughout this article we are going to discuss 3 of the most popular credit card mistakes that you should avoid at all costs.

    Interest Out - Cash Back In

    Cash back credit cards work on the basis that you spend money throughout the course of the month and then earn cash back as a reward for your spending. Most cards will have an introductory offer such as 5% cash back in the first three months, this means if you use your card for the bulk of your spending you could find yourself with a earning a decent amount of cash back.

    The problem is, these cards also have quite high interest rates (usually around 20% APR) meaning if you fail to repay the balance in full, the interest you are being charged could outweigh the cash back you are earning. By tracking the amount you are spending and paying off the balance in full each month you will never risk losing any of your hard earned cash back in interest charges.

    Only paying the minimum payment

    Don’t get me wrong, making the minimum payment is better than not paying at all, but it’s certainly not a trap that you want to get stuck in. The minimum payment is generally around 3% of the outstanding balance and will be stated on the bill. The problem is although you may feel like you’re steadily chipping away at the balance interest is accruing at a similar rate meaning you’re barely shifting any of it.

    In fact, if you have $3,000 worth of debt on a 17% APR credit card and you only ever pay the minimum payment of 3% it will take you over 17.5 years to repay the balance! In this time you’ll have accrued $2,200 worth of interest making the total cost of credit $5,200.

    Multiple applications

    One of the most effective tools to use when searching for a credit card is the comparison website. By entering your details and requirements the comparison engine will return a lengthy list of providers that may be able to help. Its then up to you to decide which lender meets your needs best.

    The worst thing you can do in this situation is apply with a number of lenders in the hope that this will increase your chances of approval. This isn’t the case, by applying with multiple lenders you could actually be shooting yourself in the foot. This is because when you make an application the lender will carry out a credit search, every time you are credit searched this will leave a footprint on your file. If a prospective lenders sees that you’ve applied to multiple lenders it may indicate that you are desperate for money or financially unstable. Very few providers will be willing to lend to someone who looks financially unstable, regardless of whether they actually are or not.

  • 5 Tips to Increase Your Credit Score

    There are a number of ways to increase and improve your credit score, and they’re not as difficult as you might imagine. A high, solid FICO score is vital these days; it has an effect on everything from getting approved for a credit card to getting approved for a rental application or a mortgage. If your score is low, it can negatively impact dozens of areas of your life, so it’s simply not worth it to let your score plummet. When looking to improve your score, you have to be vigilant and determined, but as long as you are willing to work on it, you can fix most of the things which damaged it in the first place.

    Pay on Time

    Keeping on top of your finances is crucial when you want to improve your credit score. You simply don’t have the luxury of a lot of late payments, whether the bill is for your credit card, your cell phone, or your cable provider. Every late payment is a black mark on your record, and it causes your score to drop. There are several ways to make sure you pay off your bills on time:

    Set up a payment reminder;

    Set up a monthly budget;

    Use automatic payment methods

    Reduce Your Debt

    This option may be difficult but it can be done. Again, it will take hard work on your part. You can begin doing this by giving your credit cards a rest. You shouldn’t cancel them, because that’s generally more harmful than helpful. To get your finances updated and in order, just stop using them. You also need to be aware of your interest rates and the principle amounts you owe. By using the budget mentioned above, put the majority of your leftover funds toward paying off the cards that charge the most interest.

    Be Aware of Your Score

    Knowing your actual credits scores needs to be a top priority as well. It will let yo Credit monitoring services are another way to keep good track of your credit score on a daily basis, and be alerted if any major changes occur.u know exactly how much you need to improve. It will also let you see if there are any mistakes that can possibly be disputed. Often, someone’s score can lower dramatically due to something that isn’t even correct, which is why it pays to be both diligent and vigilant. 

    Don’t Move Your Debt

    In trying to get a handle on their finances, especially when it comes to credit card debt, many people make the mistake of “paying off” the balance of one credit card with another. Naturally, you really aren’t paying off anything; instead, you’re simply moving your existing debt from one place to another. It doesn’t really go anywhere, because then you are left paying off a larger balance on a different credit card.

    Credit Care

    While other bills are important in determining your score, credit cards are highly important as well. In addition to the mistakes mentioned above, cardholders hold a variety of misconceptions about their credit cards, which lead to bad decisions that can actually negatively impact their credit scores even more. When it comes to credit cards, you should not :

    Open several cards in a short amount of time;

    Close down cards you do not use;

    Open unnecessary cards in an attempt to better your score.

    Your finances are too important to take lightly, and your credit score is too vital to let it plummet because of mismanagement and mistaken conceptions. Increasing your score is surprisingly easy once you know what to do. As long as you are responsible with your money, you can see improvement in a surprisingly short amount of time.

    Diane Johnson graduated from the University of Utah with a degree in political science. When she’s not traveling she enjoys writing articles about University of Phoenix, reading books and shopping.

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