Get Out of Debt in 2012: Cutting The Fat

Get Out of Debt in 2012: Cutting The Fat

By now you’ve seen how much debt you owe and devised some sort of a budget. Is that working well for you?

If you’ve followed the jar method of budgeting, you should have had about two weeks of testing this method out. How’s it going? You should be able to project out and see if you will be able to stay within your spending limit for each category – if there are no emergencies.

I’ve found that the “miscellaneous” or “entertainment” jar is where money often disappears the fastest, leaving the savings jar empty or with a few pennies rattling around at the end of the month. Is that what you’ve experienced? If so, it’s fine. We are going to change that for you with today’s lesson. We are not going to restructure your entire debt, we’re just shaking things up a bit. […]

Starting an Emergency Fund With the Right Amount of Money

David Bakke is a personal finance blogger who writes about budgeting, shopping, and saving for retirement on Money Crashers

The amount of money you should have in your emergency fund varies according to your unique needs. Many experts claim that three months worth of living expenses is sufficient, while others claim you should have six months of expenses covered in your emergency fund.

I have even seen calculators online that provide an emergency fund estimate by combining minimum monthly expenses, the length of time it might take to find a new job, and the amount you could cut back on your spending if you did lose your job. […]

Savings Account - Finance 101: Why Banks Want You to Open Accounts

Finance 101: Why Banks Want You to Open Accounts

I’m starting a new series here called Finance 101. When the mood stikes me I’ll cover one basic consumer finance topic that I think will help us as we both get out of debt. Let’s begin this series with the most basic thing…why banks need you to open accounts and deposit money in the banks.

Deposit accounts are your typical savings or checking accounts where you deposit money into an account at a bank. They’re sometimes called demand accounts meaning that they have to give you your money when you ask for it. When you deposit money at a bank, the bank now physically has your cash and gives you some note that says they’re holding that money for you. It might be your deposit receipt, your statement or a passbook. So, the bank now counts your money as their asset but also lists that same money as a liability that they owe to you. What’s just happened is that you have effectively given the bank a loan and now they owe you the money whenever you come back and say that you want it or when you spend it by using debit cards or checks. […]