Stop, Think, and Save, At Least Once a Year!

If you will be receiving an income tax refund, have you considered how you will use it?

Before you give in to the pressure from family, friends, and retailers to spend your refund, why not buy yourself a little time. Think of this refund as a financial opportunity for you! Then, think maximize. Ask yourself how it can bring the most benefit to you.

Here are some points to consider:

  1. Treat yourself! Yes, I said treat yourself. Is there something you have had your eye on for a while? If so, consider taking a small part of your refund and treat yourself. It is okay to be good to yourself, and you should, as long as it does not break the bank. Also, this may satisfy your urge to spend, freeing you to now think about maximizing the remainder of your refund.
  2. Look at your emergency savings. Do you have an emergency fund to cushion you when (not if) you are hit with an unexpected expense? Can you easily cover a bounced check, furnace repair, or deductible on your home, auto or health insurance policy? If you cringe at the thought of these things, you may need to make a deposit to increase this account. Make sure you have at least $500 in your savings account for an unexpected expense, and then continue building it to the recommended amount of three-six months of after-tax income. You will breathe a bit easier and sleep even better with this new found peace of mind!
  3. How about boosting your retirement and other forms of long-term savings? Consider opening or contributing to a CD, IRA (traditional or Roth), or college fund for your child. If you are not getting the maximum match from your employer for your 401K account, consider adding additional funds.
  4. Look at your debt. Paying down debt can save you in the long run. If you are behind on a payment, get caught-up! If you are caught-up, make an extra payment, or two, focusing on the debt with the highest interest. Can you pay off a credit card? Paying off a credit card that has an interest rate of 18% is like saving 18%! Ultimately, it is the interest that robs you of your hard-earned money.
  5. What are you putting-off? Make a list of the things that you need to do, but have not done because you lack the funds. Pay close attention to your home, transportation, and self. Prioritize that list. Is there a house or auto repair that needs done? Do you need tires or a furnace tune-up? How about your health? Have you been avoiding the dentist because you don’t have the money? Invest in your own well-being as well as maintaining your home and auto.
  6. Share! If your finances are in good order, consider making a donation. Is there a tax-deductible charitable organization that you have been wanting to support? Now may be the time!
  7. Lastly, if you are not sure, you don’t have to immediately make up your mind. Deposit it in your savings account and think about it until you have carefully reviewed all of your options. Remember, you can only spend it once!

One final word. If you are receiving a substantial refund, consider adjusting your withholding so that this money is in your regular paychecks instead of having to wait for an annual refund. The government is returning your money to you, with no interest added. Can you put your money to better use?

How to Buy a Car? 10 Step Strategy for Buying a Better Car Without Overpaying

Buying a car is a major purchase and can be a daunting task, but to convert that daunting task to an easy task you should learn some essential car buying tips. Deciding on what you exactly want and what you are willing to pay ahead of time will save you more money and make you avoid a lot of hassle and common pitfalls. Follow the 10 step strategy to get a better car deal with the most appropriate price:

  1. Check your budget: Setting a budget is the first crucial step. A budget will let you choose only the cars that you can afford, so stick to your budget and choose only the cars that you can afford.
  2. Choose the right time: At certain times of the year there will be a huge car inventory at car dealerships. At those times you can find competitive prices, more incentives and better deals. Best time could be the beginning of the year and from July to October. So it is much better to look for the most appropriate time when you buy a car.
  3. Research the prices: If you want to save as much money as you can when buying a car, research car prices. By now, you are limited to the cars that fall into your budget scale, try to research the prices of those cars by visiting online websites such as Edmunds.com, Kelly Blue Book and NADA to research the prices of those cars. The most important thing is collecting as many price quotes as you can so you can extract an average price for each car you are interested in. Bear in mind that cars have many different price, but the invoice price is the most important thing to know when starting the process of negotiation.
  4. Make two lists: New and used cars have advantages and disadvantages. For example, new cars are stocked with new features, but as soon as you buy it, there will be a depreciation in price as much as 11% to 15%. On the other hand, used cars are considered a field for best deals with good prices, according to their conditions, but they may cost you more if you finance them and may cost you much more for the maintenance. So consider making two lists each one contains the collection of cars you are interested in buying along with their respective average prices.
  5. Choose car requirements and model: Now that you have two lists and a collection of cars, try to organize each list in terms of requirements and model. For example, which aspects you need the most: Do you need a towing package with the car? Do you need a big car for your family? Do you want a fuel-efficient car?
  6. Consider payment options: Obviously there are two ways of paying, either you pay in cash or you finance the car. If you finance the car, you will pay a down payment, then you pay a monthly payment until you finish the total price of the car. If you afford to pay in cash that is great, but many people choose the financing option. If you are going to finance, try to make the down payment as high as you can. Some people choose a financial plan at dealerships, but it is not recommended because you can find better finance options with a good interest rate at banks, Credit Unions or online by visiting websites such as E-loan and Lending Tree.
  7. Consider insurance premiums and warranty: Insurance is a major factor in the overall price of the car. Bear in mind that if you buy a sport car or popular car, the insurance premiums will be higher than the conventional cars. Warranty is something that will guarantee maintenance for your car if something wrong was ever happened. Whether you buy new or used car, make sure that it has the manufacturer warranty, so you do not have to pay extra money for the extended warranty.
  8. Inspect and test drive the car: You must inspect and test drive the car before you buy it. If you are buying a used car, inspect the car by a trusted mechanic to disclose any potential problems the car may have. Furthermore, have a vehicle history report to detect any major problems the car may have to check whether it has salvaged, stolen or has been involved in an accident. When you test drive the car, take enough time on it and focus on the driving experience and whether it will suit you in the future or not. If you do not feel good, leave it and try another car. Do not be impulsive instead, be calm and focused and do not let the dealer or the salesperson sway you to another choice. You did your homework, and you must stick to it to get the best deal.
  9. Negotiate the price: Depending on your research and the two lists you have in hand, you can negotiate with confidence. Now you have price quotes and loan rates to help you with negotiation. If the car you are going to buy is new, make sure that you know the “invoice price” so you will be in a better position when you negotiate. On the other hand, if the car is used, make sure that you know the recent resale price for that car.
  10. Rethink before you sign: Finally, if you have made up your mind and picked a car to buy, rethink before you sign. Make sure you do not sign “as is” statement until you have thoroughly inspected the car and checked its performance and comfort level. Read the fine print carefully and do not sign until you know all the details in the contract. Do not let the dealer or the person who sells you any car make you sign quickly instead, take your time to read each clause in the contract better yet, take an attorney with you to finalize the paperwork for you.

As you can see, if you want to get a better deal when buying new or used car, there are a lot of things that are taken into consideration. It is always best when you know what you want and what you are deciding to pay before you buy. So do your homework ahead of time to enjoy your favorite car.