Basic Budgeting Tips to Get You Started

Let’s face it—we could all do better with budgeting. Whether you just splurged on a pair of jeans you really didn’t need, or eat out one too many nights a week, money goes faster than you think. Those daily lattes add up, after all. If you’re new to budgeting, it can seem like an overwhelming territory to navigate. These tips keep it simple so you can tackle this responsibility with ease.

Figure out what your monthly expenses are.

I’ve played the game before of adding things up in my head and coming up with an arbitrary number of how much I spend a month. But sitting down and actually looking at your bank statements to see what you’re spending is another story. Break it down into the various categories you’re spending in so you can see where it is you can cut back.

Set goals.

Is there a trip you’re saving up for? Are you trying to make your own meals instead of eating out as much? Have you had your eye on a designer purse for a while? Everyone has something that they want to save up for, so set goals for yourself! This will create an incentive for when you notice yourself spending frivolously.

Don’t spend more than you make.

This sounds like a no brainer, but believe it or not, 43 percent of Americans spend more than they make on a monthly basis. That’s a pretty startling number, and you don’t want to be a part of it. Only put on credit what you can afford.

Actually stick to your budget.

We’re only human, and we all have slip-ups. But don’t let one indulgent extra-large latte on a crappy Monday turn into a daily ritual—before you know it, the budget is out the window. Set reminders on your phone or have a trusty friend hold you accountable so you remember to stick to your monetary goals.

Put the extra money into savings.

Out of sight, out of mind—that’s how I view my savings account. I don’t view the money in my savings as spendable. I see it as money that will go towards a big-ticket item or a once-in-a-lifetime trip down the line.

There are countless other budgeting tips, but stick to these basics and you’ll be off to a great start. Happy saving!

Busting Common Credit Myths

Anyone who has purchased a home or is currently looking to buy can tell you that credit score is one of the most important factors in securing a loan. It can affect a lot of other areas of your life, too, but is particularly important in the real estate world.

Depending on how much research you’ve done or who you’ve spoken to, you might have bought in to a number of popular “credit myths”—fears about credit score that simply aren’t true.

We’re here to breakdown these frequently-believed myths, and explain what they really mean.

All debt is bad, and will lower your credit score.

Debt is a scary word. Most of us believe that having any debt looks bad and will negatively affect credit. However, there is a big difference between debt that can actually benefit your score and debt that can hurt it. If you rack up thousands in credit card debt, this will surely hurt your rating. If you take out a mortgage on a home, this shouldn’t hurt, so long as you continue to make your payments.

Checking my score will damage my rating.

This myth is simply not true, although it’s touted by nearly every credit reporting site out there. When you use a service to check your own score, this has no impact on your rating. But when you apply for a line of credit, and a creditor is required to check your score, this may bring down your rating.

If you don’t use a card you should close it.

Find that you aren’t using a card as often as you used to? It’s not always wise to close the account just because the card is sitting unused in your wallet. A portion of your credit score is determined by the length a line of credit is open, so if you can, try and use the card at least once every so often to avoid the creditor closing your account entirely.

You can improve your score immediately by paying off debt.

You should always try and make your monthly payments. But if you miss a payment, making that payment (even the very next day) won’t remove the problem from your score. Missed payments can drop your score fairly significantly, so it’s critical to pay off credit timely, and in full, if you can.