The Highest Interest Savings Account will not save you money

That's right. If you are looking to save money, the highest interest savings account will not get you there. You might as well call it an emergency fund.
What is an emergency fund?
An emergency fund is an easily accessible stash of money for use only in case of emergency. It is not to be used to buy a toy or a vacation. It is not to be used to renovate your kitchen. It is for use only in case of emergency.
Allow me tell you why Having an Emergency fund and leaving your money in a savings account (even if it's the highest yield savings account) is a stupid idea.

This is my experience with savings accounts. 

I am normally a very cautious person. I try not to get into debt. (I've been there done the and it ain't pretty. I never want to feel that awful anxiety in the pit of my stomach again. And the debt wasn't even my doing (I will write about that at a later date)I sold my house and paid off my debts but I still had money left which I put into an ING High interest saving account at  the bank. After all, ING gives you the best interest rates for a savings account. At the time it was 1.5% Slightly higher than a regular  bank checking account.
(I know, I'm lucky cause I had a house to sell)
Putting it in the bank instead of investing it was to my cautious nature the right thing to do. After all I can't lose the money. It would grow, slowly but it would grow.
It was my emergency fund. Who knows what could happen. If I needed money, it would be there for me. Anyway, I wanted to buy a house. so I needed to stay liquid. 4 years later, I still hadn't bought anything and my interest did grow but it was a joke. my sister was making money hand over fist with her investments. Safe reliable investments that gave dividends. Read more about dividends.
If I had put my money into safe investments instead of a high interest savings account (such as BMO, BCE, Scotia, Fidelity) I would have been making about 5 - 8% a year instead of 1.5%.
Guess what happened?
After 4 years I still hadn't bought a property, so I invested my savings into excellent but conservative dividend yielding stocks. The next day I found a fabulous condo, I bought it. Had to take the money out and lost a little bit in the exchange but I still came out ahead.
But now I have a great property.
So where is this story going you ask? Simple - an emergency fund sitting in the highest yield savings account in the bank is like flushing money down the toilet.

A savings account does not save you money.

You lose money because the inflation rate is higher than the 1% you will receive, and you have to cut that in half because of taxes. Yes, you get taxed on your savings. You get taxed on investments too but at least they are more lucrative.
Unless you have a gazillion dollars stay away from risk.
Stay in conservative dividend yielding stocks and if you do need money for an emergency, you can always withdraw the amount you need.
If you don't need the money, let it grow.
If you need a bit of money, let it sit in ING at least you don't have to pay fees.
So, in conclusion an emergency fund in a highest interest savings account is not something you need. Investing money you have saved is better. BUT if you have debt - credit card debt, loans, etc… put down money on the debt. you will save more by eliminating credit card debt than you will by having an emergency fund sitting in a low yield savings account.

Get Rid of Credit Cards : Should I Cut Them Up or Close the Accounts?

Get rid of credit cards --- How? If you are struggling with credit card debt, this may be one of the questions at the top of your mind. 

For some people, just owning credit cards presents a huge temptation to spend. They go to the store, and see a pair of shoes they just have to have. It is not in their #budget, but they know they have their credit card along, and can just charge it. Perhaps this is your struggle—you rationalize your purchases by saying to yourself: “I’ll pay it off right away.” Deep down, you know you might not be able to. 

If you really have trouble spending and getting into debt, at least make sure you do not bring your credit cards with you when you shop. It’s kind of a like a drug addict putting themselves into a situation where they know there will be drugs available. If you let yourself be vulnerable to temptation, you may easily succumb. 

Start your credit repair process today 

With #online shopping available from your home personal computer, maybe you should go a step further to stop your spending habits. I have known of some people who freeze their credit cards in a block of ice, making them very inaccessible.

The bottom line is, cut up your credit cards, if that is what it takes to make you stop spending money you do not have. 

Should you get rid of credit cards?
Should you cancel your accounts?
Here are some practical answers to those questions:

First, your credit score is better off if you pay off your credit card accounts rather than canceling them.

Next, if you are going to cancel accounts, start by canceling store credit cards. Space it out over a period of time. Never cancel all credit cards at once, as this will negatively impact your credit score.

Finally, there are some situations where you may need a credit card, such as for renting a car. Of course, there are alternatives to #credit cards, but #financial experts recommend keeping open at least one or two major credit card accounts. Having one or two major credit card accounts is better for your credit score.

In conclusion, I highly recommend that you do not charge purchases on credit cards unless you KNOW you can pay the balance off every month. 

Should you just cut up your credit cards? 

Have You Paid off Debt or Are You Working on Paying off Debt?

Share how you are paying off or have paid off your debt! This will encourage and inspire others to begin doing the same.

Maternity Clothing – Save Money on the Items You Need for Your Pregnancy

Maternity clothing is expensive, but it is possible to #save money, #live debt free, and still get the items you need. #Pregnancy is an exciting time, but don’t be fooled into thinking you need every item when clothes shopping. 

First, consider these tips to save money on pregnancy apparel from moms who have “been there”. 

1. Ask your friends or family if they have #maternity clothing you can borrow. If your sister or co-worker is close to the same size as you, this option could save you lots of money. 

2. Raid your hubby’s closet. You can borrow things from your husband or significant other like sweatshirts and flannel shirts to wear around the house.

3. Buy classic pieces that can last you through more than one pregnancy. Resist anything really “trendy”. Pick things that will still be in style in a few years, especially if you are planning to have more than one baby.

4. Decide whether you really need maternity underwear. Personally, I could always wear my “regular” underwear underneath my stomach while pregnant, but you have to decide if this would be comfortable for you. One thing you do need is a few good pregnancy/nursing bras.

5. Shop at yard sales and consignment stores. You can often find a lot of basic pieces of clothing for a lot less than retail. 

Here is a list of the basic maternity clothing items you will need for your pregnancy: 

1. Several good bras 
2. Two pairs of jeans 
3. One pair of sweatpants 
4. Two or three pairs of classic black or tan pants/skirts (if you work outside your house) 
5. One or two pantsuits or dresses (for work or church) 
6. Several dressier shirts 
7. Two or three casual shirts 
8. Two pairs of pajamas if you wear them (get button-down shirts for nursing after the baby) 

Another tip—try to get jeans and pants with drawstrings rather than the classic “belly panel”. They will last you longer, and you can wear them after the baby comes. 

When it comes to sizing, most stores say to buy the size you wore pre-pregnancy. Most of all be sure to buy or borrow clothing that makes you feel attractive and comfortable throughout your entire pregnancy. 

Start Saving Money: 8 Creative Ways to Help You Begin to Save

Start saving money – just the thought may be totally overwhelming to you.”I’m already in debt, how can I save anything?” or “Where do I get even a little money to put away?” may be some of the first questions that come to your mind. It is actually possible, really possible, for anyone to get that first deposit to start a savings account.Here are some ways to begin: 

1. Have a yard sale. You may already shop at them, so why not have one? Everyone has excess junk, clothes that don’t fit them anymore, or toys they no longer use to get rid of. Instead of taking a trip to the donation center, try having a yard sale. I know of people who make hundreds of dollars on their used stuff. Even if you only make $50 or $100, it’s a start on a savings account. 

2. Sell on Craigslist. If you have bigger items (a refrigerator that still works, a kids' swingset, a winter coat) that you could part with, list them on Craigslist. You will be emailed by potential buyers who will come to your house to pick up the items and give you the cash. Personally, I like to have my husband home if someone is coming to the house for safety’s sake, so please keep your own safety in mind also.Sell on Craigslist 

3. Raise your deductible on your car insurance. If you have an older car, it might be worth it to raise your deductible and save a few hundred dollars a year.

4. Use your own bank’s ATM. This seems like a little thing, but can really add up. If you are using an ATM that charges you $2.00 once a week, and you switch to a free ATM, this adds up to a savings of over $100 a year. 

5. Learn to do more things yourself. Try coloring your own hair, cutting your husband’s hair, or waxing your own eyebrows. There are lots of sites online that can help you save money by learning to do things yourself that you would normally pay a professional to do. The potential savings per year can be in the hundreds of dollars--a great way to start saving money.
6. Wash your own car. Washing your car is not that hard, and your kids can help you do it (Translation: fun family activity!). Think of the savings per year: $5.00 a month minimum, 12 months a year = at least $60 a year to save!
7. Rent a video instead of going to the movies. Movies cost $7.50 per person where I live. So, a family of four is going to pay $30 just for the tickets. Popcorn adds in another $5-10. Total cost is around $40. Renting a movie from the local video store will cost you $4.00 plus the cost of a bag or two of microwave popcorn and a soda.
8. Make your own coffee to take to work. Two Starbucks coffees will cost you more than a bag of coffee at the grocery store. A bag of coffee will last you for a couple of weeks.

These are just a few creative ways to start saving money. Open a savings account, try some of these ideas, and you are on your way to a future of debt free living. Your children will learn about saving money also—so set the example now! 

Insurance for Less Save Money on Life, Health, Dental and Auto Insurance

Insurance for less money is a topic that is important for bot men and women.

Here are a few general tips regarding insurance: 

1. Always have health coverage. Medical bills can cost you thousands of dollars and end up on your credit report (should you be unable to pay). Even if you are between jobs, extend your previous coverage until your new coverage kicks in. For your children, if your family is uninsured, most states now offer free or low cost children's health insurance.

2. Become educated about different kinds of coverage. In order to get insurance for less, you need to know all about the different kinds of coverage available. You need to be aware of why they are necessary and how they are useful. In this section of Moms-Living-Debt-Free.com, we will help you by discussing how to save money on the following:
Life Insurance 
Health Insurance (and how to get an individual plan) 
Individual and Family Dental Plans 
Auto Insurance 
Homeowners Insurance 

3. Always shop around for best rates. There are websites that let different agents contact you and compare rates. I have saved hundreds of dollars by comparing rates on various kinds of coverage.

4. If you have multiple policies with the same company, ask for discounts. If you have your homeowner's and auto policies with the same company, you should be able to get discounts to get cheap insurance rates. Usually the discounts are anywhere from 10-20% of the normal quotes. Ask your agent about this.

5. Always use a reputable agent or company. If you haven’t heard of the company before, do research on them on the internet. If you are going through an agent, be sure to ask around to make sure he or she has a reputation for honesty. Remember, it’s often cheaper to buy insurance directly, because agents are getting a commission. On the other hand, some people like the convenience of having an agent they know help them with the claim.

By following these tips and learning about different kinds of insurance coverage, you will be able to get insurance for less. Do your research and make wise decisions to protect your family and your assets. 

A Budget: Why Your Family Needs to Have One!

Despite the importance of making a budget, for many people, just the word intimidates them. It conjures up mental images of living on Ramen noodles, or never taking a vacation. 

I remember when I was newly married, and   drafted my first budget for our family. I was extremely surprised at the amount of money we would need to make ends meet

Below are the reasons why YOUR family needs to have a financial plan:

 It will allow you to see what expenses you have and how much money you are currently spending. With this information, you have a better idea of what you can eliminate, and how much money you need to be earning to make ends meet. I personally recommend the envelope system as an efficient and easy way to keep track of your money.

 You are better prepared to set up a savings plan. Once you know how much money you need to live, your family can more easily decide where you are able to “cut back” in order to save money.

Free Downloadable Microsoft Office Family Budget Template

 It is an excellent tool to help you get out of debt. It helps you to ask yourself the hard questions like: “Do I really need to eat out every week?” or “Do I need Cable Television?”

It helps keep your family informed. Sit down with your spouse if applicable, or your older children, and explain to them exactly how much money is allotted for certain items. This keeps you and your spouse on the same page, and helps your children to understand the value of money.

Remember, successful small businesses, large corporations, and even our government operate within financial guidelines--your family needs them too. 

What if you make one and find out you can’t meet your monthly bills?

First, evaluate what extras you can eliminate. Can you cut out your snacks or sodas from the vending machine at work? Can your children pack a lunch instead of buying it at school? Think about this: If you or your spouse spends $1.00 in the vending machine each day at work, that is $5.00 a week, $20.00 a month, $240 a year!

Next, think about ways to increase your income. Can you sell some things on Ebay each month? How about babysitting a few nights a week? Can you take a part time evening job?

Making your own budget will be trial and error. You have the freedom to change things and re-evaluate in order to make it work for your family. 

Whether you are newly married, married with children, or a single mom, now is the time to get your finances in order. Do not get discouraged—debt free living is worth the effort. 

Debt Free By 30 – Is this Goal Realistic or Possible?

Debt Free by 30 – this is a dream that a lot of younger people have, especially those who have learned about finances.

Some younger people would like to be debt free by 30 so that they can feel the confidence of owning their home, be able to stay at home with their children, or to be able to start saving for retirement. 

Perhaps you are struggling with debt from student loans or credit card debt. Maybe you or your spouse has recently lost a job. Is it realistic to have a goal of being debt free by 30, particularly if you are in your early to mid twenties? Some younger people would like to be debt free by 30 so that they can feel the confidence of owning their home, be able to stay at home with their children, or to be able to start saving for retirement. 

Here are some tips to help you reach this goal: 

1. Work hard. This sounds so simplistic, but it is the truth. Many people think of their twenties as still a “time to have fun”, but if you want to be able to pay off debt, you probably should concentrate on getting a good-paying job. Work as many hours as you can, and work overtime if possible. In fact, if your debt or loans are really high, you may want to take on a second job. At least when you are young, you will have a lot of energy for this! 

2. Spend Less Money. Every time you go out to eat, you probably blow $20+ that you could be using to pay down your debt. Add up all the little things you waste money on: expensive coffee on the way to work, name brand clothing, high-priced makeup, etc. Then stop spending the money. Every Friday or Saturday night if you go out, you are wasting more money, and time that could be spent working. I’m not saying you can never have fun, but living debt free does require sacrifice. 

3. Don’t expect to have the same standard of living as your parents. If your parents live in a beautiful house or condo, with a big-screen television, and brand new cars, realize that they worked for years to get to that point. Many newlyweds or singles make the mistake of wanting to have everything that mom and dad had right away. It’s just not possible, unless you go into debt to do it. Settle for the smaller apartment; put off getting the new car. It is worth it to save the money. 

4. Save money. If you do not have a savings account start one now. Online savings accounts typically give you the best rate of return on your money. Put aside a reasonable amount of money ($500-$1000) for a rainy day. Then save more as you are able. Of course, always make paying down your debt your first priority. 

It is possible to be debt free by 30 (or 40, or 50!). Do not be discouraged. Remember, you will be benefiting not only yourself, but your family and your children.