When Money can buy happiness?

When Money can buy happiness?



Money can buy happiness



As a Quotes say,

Money can buy a house but not a home…

Money can buy a bed but not sleep…

Money can buy a clock but not time…

Money can buy a book but not knowledge…

Money can buy blood but not life…

Money can buy sex but not love…

For some, money can cause a lot of pain and suffering so to help you with that pain send all your money to me and I will suffer for you. joke! (hehehe!)

So, what’s the point of this joke? Money is not everything and the common belief is that money can’t buy happiness.

Let’s accept it; lack of money can be a real frustration. You need a certain amount of money just to cover the basics in life – food, shelter, and clothing. But having more money does not mean necessarily make you happier. It really depends on what you do or where to use your money that creates happiness.

I’ve been reading a lot of this topic and I have come to believe that money CAN, in fact, buy happiness – we just have to spend it on the right things.

1. We can be happy by spending our money on experiences, not things Spending is fun.

Spending makes us feel rich. But unfortunately, it’s a short term high that does not usually last.

Think back to a great trip or a memorable experience and how does it make you feel? Spending money on experiences can create everlasting happiness because those memories can last a long time.

2. We can be happy by spending our money on relationships

People have a strong influence on our happiness. Making others happy can make you happier. Being around with happy people often makes it easier to be happy. I know my relationships are very important to my happiness.

money equal happiness

I’m not suggesting that we buy friendships but investing in friendships and relationships can go a long way. Couple this with the first thing about experiences and you can have a very powerful combination.

I had a friend that was not interested in buying an expensive toy for his kids. Instead, he felt better investing that money for a family picnic every Sunday. That not only brought him more happiness but also brought more memories and bonding time for the family.

3. We can be happy by spending our money to create security and control

One of the key elements to happiness is to have financial security and control (Stress free cause by money). Paying down debts and saving money adds to happiness. Spending money on stuff is like a drug. It can give you a quick high but it’s often not sustainable.

4. We can be happy by spending our money on pets

Many studies have shown that people love their pets and pets can be a tremendous contributor to happiness. I don’t have pets today but I grew up with dogs/cats in the house and I loved the unconditional love and happiness they brought into my life and our home.

5. We can be happy by spending our money on health

Good health has many benefits including the potential for more happiness. Good health creates opportunity for experience, relationship, activities, confidence, energy and accomplishments.

6. We can be happy by spending our money on goodwill and community

One of the best ways to make yourself happy is to make someone else be happy. Think about ways you could spend the money that would make a big difference to someone else — whether someone you know, or a cause you support.

Does donating money to a good cause make you feel like a better person? Does it make you happier? I know I get a lot of joy and happiness by giving financial help to those helpless people.

Last Word

Making happy everyday is a personal choice just like our values and thoughts around money are also personal. That’s also why financial planning is personal too. There is no exact ways on finding happiness whether you have money or not. Therefore, there is also no perfect correlation between money and happiness. That correlation is personal.

For me, I’m not ashamed to say that there are a lot of things that make me happy and having enough money is one of them. I love money and I love what money can do for me and my family. Not everyone feels the same way. How do you feel? What do you think?

A New Baskets System For People Who Can’t Budget

A New Baskets System For People Who Can’t Budget


Why Bro. Bo Sanchez don't use budget to his personal life? Here's why.

Basket System

If you’ve been a TrulyRichClub member for quite some time, you’ll know that I don’t use budgets for my personal life. I know that’s a mortal sin for some financial planners, but I gave up making budgets years ago. I’m one of those individuals who doesn’t like to sit down and write down a budget—like how much I’ll spend this month for grocery, for clothes, for haircuts, for snacks, etc…

I don’t know why, but when I see a page with numbers, I zonk out. My mind gets fried. If I keep reading the page with numbers for more than 10 minutes, I get a nervous breakdown.

I’ve learned that budgets work for some people. Like my friend Wilma. She’s got her monthly budgets in an Excel program, complete with colors and categorized in folders with nice labels around them. She’s so organized, her room is like a museum. Goodness, her clothes in her closet are numbered. Even her toothbrush has two dates written on its side—when she first used it and when she’ll throw it (exactly three months).

But early on, I learned that I’m not Wilma. Budgets didn’t work for me. Through the years, as I talked to lots of people, I know that budgeting doesn’t work for many others too. Instead of a complicated BUDGET system, I use a simple BASKETS system. And that has worked for me splendidly.

Here’s what I did… 

Three Baskets Following the 30/70 System 

Years ago, when I received new money, I’d divide my money into three baskets: my tithes (10 percent) and my investments (20 percent) and lived on the rest (70 percent). Note: Actually, these aren’t my percentages anymore. I tithe and invest much more now.

That, in gist, is my 30/70 Basket System. This simple fund allocation system is one of the biggest reasons why I’m a millionaire now. Years ago, I remember days when the 70 percent was gone before my needs were all met. How did I cope? I gritted my teeth, tightened my belt, and postponed purchases until new money came in. Difficult to do but that was how I did it.

It worked. And I know it worked for a lot of people too. Because of my simple Basket System, my retirement fund has grown tremendously. Investing 20 percent of my income over the past years has compounded and multiplied my money beyond my wildest imagination.

If you’re like me who can’t make a budget or follow one, just use my Basket System: The moment you receive income—any kind of income—just set aside your Tithes and Retirement. And live on whatever is left.

That’s it! But here’s something I found out. After helping a lot of people organize their finances, I realize that some people may need a more nuanced Basket System. So I developed a new Basket System for your money. Here it is (drum roll please)… 

The 5W Basket System 

I know it has more Baskets, but bear with me. I’ve checked with other financial teachers and they teach similar categories. Let me explain the 5W Baskets...

First, 10 percent is your Worship Fund(Tithes).
Second, 20 percent is your Wealth Fund(Long-Term Investments).
Third, 10 percent is your Want Fund (Yes, Splurge!).
Fourth, 10 percent is your Wellness Fund(Short-Term Savings).
Fifth, 50 percent is your Wallet Fund (Regular Expenses).
Let me explain the two new Baskets: Want Fund and Wellness Fund. 

10 Percent for Your Want Fund 

There are needs and there are wants. This specific fund is for your wants. They’re not necessities. You can live without them. Why this Fund? You see, there are two extremes you want to avoid. First is the Spender.

Want Fund

The impulsive buyer. The shopaholic. The one-day millionaire. The person with the latest gizmos and gadgets, but who has six credit cards, all maxed out. The person with the Louis Vuitton bags, but has zero savings. You don’t want to be this person.

The other extreme is the Scrooge. The miser. The penny pincher. The person who hasn’t bought a new shirt since President Marcos declared Martial Law. The person who eats crackers every day from a large tin can—bought in Divisoria—for breakfast, lunch, and dinner.

The person who is so addicted to saving and investing because of crazy fears, he doesn’t spend anything for himself. You don’t want to be this person too. I honestly believe you should spend a portion of what you earn as your way of loving yourself, honoring yourself, and celebrating yourself.

Every time you earn something, set aside 10 percent and buy what will make you happy. (Note: I suggest you start doing this when your finances are no longer in crisis mode. For example, when all your major debts have been paid.) It could be eating in a favorite restaurant. Or watching a movie. Or having a massage.

Or going on a vacation. Or buying a new shirt. Or getting a new watch. If you’re saving for a big vacation to Boracay or Batanes or Bohol—you could save this 10 percent for a few months—until you reach your goal. And then splurge!

But splurging that amount each month is great too. Rewarding yourself regularly is fantastic motivation to earn more.

Next… 

10 Percent for Your Wellness Fund 

This is for Short-Term Savings for specific projects. Perhaps you’re saving for your new house. Or your new car. Or the college fund for little Pamela and 5-year-old Julius. Or a Holy Land pilgrimage that you want to take five years from now.

If you have various projects, then you can divide this 10 percent according to each specific project. Or increase the 10 percent to 15 percent or 20 percent, depending on your income.

Will the project happen before five years? (For example, Pamela enters college in four years.) If so, the stock market may not be the place for your Wellness Fund. Put it in a Retail Treasury Bond (RTB) or Time Deposit. The interest growth isn’t as big, but it’s better than the less than one percent that a Savings Account gives you.

But if the project will take place after five years, you can still put it in the stock market—but you need to follow our Stocks Update eReport closely. (For example, when we warn you of a big downtrend, you may want to pull your money out.) 

Take Your Pick and Use What Works 

So you have a choice. You can use the 30/70 Basket System or the 5W Basket System. They’re not budgets. They’re just Fund Allocation System where you divide up your money when your income arrives. Unless of course you’re like my friend Wilma who can make budgets work.

Choose which works for you. And tell me about it!

May your dreams come true.

Bo Sanchez

Budgeting Can Improve Our Life

Budgeting Can Improve Our Life

Budgeting

Most people don't mind of having a budget.  They think a budgeting is hard to do and time consuming.  Are you one of these people?  This is a very unfortunate way to think.

How do I know?  I used to think the same way before.  However, I’ve definitely changed my mind. I’ve learned that a budgeting can actually help to improve our life.  A good and well budgeting gives us financial freedom.  It doesn’t take it away.

Things I Learned Living on a Budgeting

For the entire years of my adult life, I lived like everyone else without a budget. Today, I’ve been budgeting my money for over 3 years now.  Obviously, my positive view of budgeting has stuck. To me, this means that it is the real deal.  If it wasn’t, I would have abandoned it because it does take a little time and effort.

Here are eight ways which I believe a budget can improve our life:

1. A Budget Relieves Stress

Financial stress is one of the common causes problem in every home.  I think we’ve all experienced the tension in a household when money is tight.   Our mom and dad arguing about tuition fees, payment for utilities bills and etc. A budget helps relieve this stress because it gives you back control over our finances.  It puts you in the driver’s seat. 

Stress comes from anxiety about the future. When you don’t have a budget, you don’t know if you’ll be able to meet your obligations this month or not.  With a good budget, you know exactly where we stand which reduces stress.

Savings

2. A Budget Helps You Focus

Without a budget, no one knows where the our money goes.  We can easily spent our money on whatever catches our eye or so called impulse buying.  A budget is a tool that allows you to prioritize and direct our money on a most important things.  

It was absolutely amazing to me how much I was able to accomplish financially once I started budgeting.  It is very easy to underestimate our financial strength when you don’t have a budget. You simply do not have a tool available to focus your financial energy in any specific direction.

3. A Budget Motivates You to Simplify

Once we start budgeting, we can see exactly where our money is going.  This generally motivates people to simplify their lives because they learn that a lot of their money is being wasted on things that aren’t much important.  For example, when we started budgeting, we tend to eliminate and lessen those stuff that was regularly costing us money to store, maintain and repair.  Simpler truly is better.  It also leads to less stress.

4. A Budget Provides Freedom

Our budget gives us more freedom and not less. It reveals when and where we have extra money to spend on the things we want.  Also, it allows us to make purchases without the guilt that was involved before.  We know we have the money so we don’t have to feel guilty or try to hide what we are doing.  Our budget has also freed us from living with a debt.

5. A Budget Makes You More Generous

As you get a handle on your finances and create some margin between what you make and what you spend, you will have more money to give to worthwhile causes of your choice.  This is one of the main reasons that we wanted to live on a budget.

It is nice to be able to help our family when they need it.  It is also rewarding to be able to give to charities and our church more generously.  A budget frees up some resources that you can then direct to greater causes.

6. A Budget Will Make You a Better Citizen

As we started tightening our budget to reduce expenses so we could pay off debt, we discovered all kinds of ways to save that made us better citizens.  For example, we started shopping for local products which is much cheaper instead of buying imported.  

This converted us into supporters of our local suppliers.  Also, we lowered our environmental footprint by reducing what we consume and increasing what we recycle.  A budget leads you in all kinds of better paths in life.

7. A Budget Will Discipline You

As we start budgeting and do it frequently, it becomes a habit and a discipline, which is good for us. You will be more cautious and aware of your income and expenses. We will be more wiser. And if you are disciplined, everything will follow. And that is a good thing!

8. A Budget Is Your Path to Wealth

Finally, a budget can improve your life by leading you to greater personal wealth.  You will stop paying so much interest on borrowed money such as credit card debts, loan, etc., and you will start investing to actually earn interest . In other words, you will put your money to work for you.  It is exciting to watch your savings grow in the bank, or in your investments.  The best way I’ve found to make this happen is by living on a budget.

I will always budget my money from now on.  It is just a better way to live.  It offers less stress, more freedom and allows me to use my financial strength for the benefit of those I care for the most.  In my mind, a budget is really can improve our life.

Savings

Savings

How to save? 

Savings

When we're always talking about saving our money for the future. I often hear many alibi, reasoning, explanation, excuses etc., to do saving likes I don't have enough money, my salary is enough only for our daily expenses, my income is very low so it's hard for me to save some money and how can I save these little money? There are many excuses we can use and say as long as we don't like to save. As the saying " if we don't want to, there is too many excuses but if we want to, it can find a way".

In reality there are many and a lot of ways we can do to save. As a matter of fact, in our daily expenses we always seeing only those big spending we're making but we didn't look and paying attention on small or little spending we are making which also has a  big impact to our budget. For example, if we're buying one bottled of water every day worth of 10 - 20 pesos. Remember you're drinking bottled of water once a day only. In order to save, we can remove or lessen this in our budget and we can save around 600 pesos a month or 7200 pesos a year. 

Another thing is merienda habit, we didn't bother of what merienda habit bring impact in to our budget. If we're spending around 20 pesos again in merienda every day but we lessen or remove this in our daily expenses we can save again 600 pesos a month or 7200 a year. This amount is enough to open a broker account and buy a shares of stock of a giant company in our country as for your investment. What if you have a vices (cigarettes etc,.)? Just slowly lessen until remove this vices from your personality you can save much more money from this.

Habit of Savings

In a simple words, there are lot of ways to save if we want. The most important thing is we must decide now that we need to save our money for the future. Don't start saving when we already have a big amount of money because it will never be happen. Money sometimes are reflections of our habit. If we cannot save in small things how much more in a big amount of money.

Instead start saves slowly while there is even small amount of money flowing to us. And make savings become a habit. In due time we will notice in a month, a year our money getting bigger and bigger over time. So start saves your money now and have a habit of savings.

The Secret to Spend Less Than What You Earn

The Secret to Spend Less Than What You Earn

Spend less than you earn

A lot of personal finance blogs I've read, I notice a common theme and advices to our financial problem. And they most common advice — “Spend Less than What YouEarn”. Unfortunately, it’s easier to said than done, otherwise, There will be no rampant debt problem in our society. Fortunately, I went through this in myself, and over the years, I’ve learned a few tricks that I think it might help also to you.

The secret to spend less than what you earn.

Step #1: You Must Know Your Income

Answer this question, how much money you make annually? This step is especially hard for people who run a small business, have a multiple income streams, or whose earning fluctuates in any way.  Nevertheless, you cannot spend less than what you earn if you don’t know what you earn.

Step #2: You Must Establish a Spending Plan or In short Make a Budget

Once you've already know and determine your income. You should keep pay attention and remember that you cannot spend more than this number.

Some people make a budget for weekly, others monthly, and some quarterly.  The most important thing is that you have a budget.

Step #3: Write down all the expenses and Stick to your budget

Write down all the expenses to track every peso that you spend. The only rule is to make sure that you do not spend more money allocated in each category you make.  Always be sure your budget is doing its job. To make this happen stick to your budget.

Step #4 Review the Budget, Income, and Spending

Fix any issue if there's some conflict. Whether your regular expenses are too high or not make some adjustment to make you feel comfortable to your spending and fit to your budget.

Once you have found the balance between your income and your expenses you are now in a position to spend less than what you earn.

Anyone out there spend less than you earn?  What are your tips, ideas, or suggestions?

Things That are Killing Your Budget

Things That are Killing Your Budget

Many people that create a budget find difficulties sticking to it for one reason — incidental expenses or unexpected expenses. Although incidental expenses are only a small fraction of your expenses, they can have a really big impact on your budget. These tiny expenses often go unaccounted for and can destroy your carefully crafted plans. Here are a few small expenses that are killing your budget.

1. Cell Phone Load Expenses

Too many people underestimate exactly how much money they spend on Cell Phone Load. These expenses can be so small that people fail to keep track of them. Small purchases on cell phone load and spending 10 to 30 Pesos to avail unlimited text or call can really add up over the course of a month.

2. Impulse Buying

Window shopping can be hazardous to your financial health. How many times do you go to the mall just to look and come home with a new shirt, pants or pair of shoes? Impulse buying are budget killers because they are unplanned expenses. It means that you have to borrow money from your budget that was meant for another purpose to cover your impulse buying.

Impulse buying are great for retailers like SM or other supermarket but they are not good for consumers. You can easily spend 500 Pesos or more each month on buying items that you never planned to purchase.

3. Labeling Wants As Needs

It’s important to place all of your expenses in their proper categories when budgeting. Needs are expenses that are necessities such as food, clothing, and transportation. Wants are luxuries that can be eliminated. Individuals often budget around wants and not needs.

4. Wrong Kind Of Friends

Having the right kind of friends can make or break your budget. Are your friends spendthrifts who waste a lot of money and not thinking about their financial future? Or do you have freeloading friends that consistently borrow money from you with only promises of being paid back? Both types of friends can be dangerous to your financial future. 

Most individuals pick up the habits of people that they hang around. The chances are high that if your friends are big spenders that you will eventually become one. Who wants to go out while everyone is having fun and not do the same? 

Freeloading friends can eat up your savings. You will find yourself busy financing their lifestyle that you may neglect to save for your future. So better to know how to protect your money.

4 Steps to help you to stick your budget

4 Steps to help you to stick your budget

4 steps stick budget Personal Finance

Many of us really know how to make a budget. We make a list of category from most to least priority things need to pay every month so that we can adjust our income allocation to each category. But unfortunately, many of us find difficulties to follow and stick to the budget. This is the hard part after the budgets have been set up. To make sure that spending of our money is according to our budget. Here are the 4 steps that can help to stick to your budget.

1. Write down all of your expenses

For me, this is the hardest part of all. Since, it is not our habit to ask a receipt for every item we purchase. It is hard to track every month where our money goes. So it’s better to write down every peso we’ve spend on. To become more effective our budget, we need discipline to really keep tracking our spending.

2. Check during the month to see how we are doing

Review the budget. Make sure that we have enough allocated money in each category we listed and that money can last for the entire month. Do something. Cut back if you’re spending too quickly or relax a little if you are starting the month too tight with your money.

3. Total all the expenses

At the end of the month, total all the expenses. Compare it to your allocated budget in each category. And then compare your over all spending with your income and savings plan. Check out the results if it’s fit to your lifestyle or not.

4. Make Adjustments

When we already know how and where our money goes. We can now decide whether we need to adjust our budget so that our budget matches to our spending habits or otherwise decide to adjust our spending habit to fit in our budget.

After doing all this, you have now some valuable information that can help us in planning our finances. Remember that in order to gain more knowledge on making a budget and make our budget more effective we must discipline ourselves and do the hard part living by a budget. That is, records all every peso we spend.

When Buying the Expensive Version Can Save You Money

Usually buying the expensive version of a product or service would seem counterintuitive to saving money. In fact, being frugal doesn't seem to have any link whatsoever with indulging on expensive things. Let me explain why there is a connection and why it's not as tenuous as you may think. No, I'm not leading you down the path to selling your house and moving all your stuff into StorageMart. What you're about to hear are actual ways in which buying the expensive version of something can save you money:

Buy a fuel-efficient electric or hybrid vehicle: While the upfront cost of a hybrid is comparable or a bit more than a new gasoline powered car, the money you save on fuel and emissions updates will even out the costs. Depending on the year and model of the hybrid you buy, you many even wind up saving more money in the long haul. Also, you'll be helping the human race save money on cleaning up the environment.

Buy high-quality coffee beans: Stopping by your favorite coffee shop every morning can easily lead to a monthly tab of $100 - and that's assuming you don't also need a caffeinated pick-me-up throughout the day. By buying high quality coffee beans, which run about $15 a pound, you will be able to reduce your monthly coffee bill to about $30 by bringing your own coffee from home. Another reason to buy high-quality beans is that they will keep you riding a more potent, smooth wave of caffeine exuberance, making you need less coffee throughout the day. So invest some of your scratch into top-notch fair trade beans and save yourself money.

Buy appropriate car insurance: Sometimes opting for the more inexpensive option can not only be risky, but downright financially life threatening, and buying car insurance is one of those instances. Getting inferior coverage in order to save $10 a month is not a smart move. If the worst case scenario happens, in which you and the other drivers' cars are totaled and people are injured, you're going to wish you had full coverage on injury and collision for all parties. It could be the difference between a few hundred dollars on a deductible vs. tens or even hundreds of thousands on repairs and surgery costs.

These are just a few of the instances in which buying the expensive version of something can save you money in the long run. Spending more upfront on a product or service is not always prudent, but in some cases it's the right move.

Why You Should Stick to Those New Year's Resolutions

If you are serious about your personal finance, it may be in your best interest to stick to a few of those New Year's resolutions that you made this year. While many make their resolutions in vain and give up after a few short weeks, choosing to stick with your resolutions can actually help you increase that personal net worth – even more so than switching car insurance policies or putting away an extra $5 a week. Here are a few ways that some of the most popular New Year's resolutions can save you money:

Losing Weight

Losing weight affects more than just your waistline. Choosing to shed a few pounds can actually save you a substantial amount of money long-term. In addition to reducing the amount of money spent on eating out and your regular grocery bill, choosing to lose weight will also reduce the amount you will spend at the doctor's office in the future. Having a lower BMI will also help you qualify for cheaper health insurance rates which can easily save you a couple hundred dollars a year.

Quitting Smoking

There is no denying that smoking is an expensive habit. Depending on where you live, a pack of smokes can reach nearly the $8 mark, and if you are a heavy smoker, that's over $200 a month you are spending on cigarettes. In addition to the outright cost of cigarettes, smoking can also lead to numerous health conditions that can lead to high medical bills in the future.

Getting Out of Debt

Sticking with your goal of getting out of debt is going to save you for obvious reasons – the quicker you pay down debt, the less money you will have to spend on high interest rates. However, paying down debt can help you save money in a few other, less known ways. By having a lower debt-to-income ratio, you are more likely to be approved to lower mortgage and car loan rates which will save you money, and it will also help you keep your credit score high which will keep you from having to pay steep deposits with your electric company or phone service provider.

We all want to keep our finances out of the red, and for many, choosing to stick to those New Year's resolutions is a great way to keep a few extra dollars in their pockets. So before you give up on that resolution yet again, think about how not choosing to follow through will affect your wallet. You just may find that the calculated dollar sign is enough motivation to push through.

Do you have a Budget?

Do you have a Budget?

Budget

Many of us fail to have a budget every time they got their salary. That is why many people are fall in to debt. Few really realize just how much they spend on worthless expenses and in the end regret for the expenses they have made. To make this not happen again and if you're want to keep your spending under control, it is better that you make a budget.

What is budget? From Wikipedia it is a financial plan and a list of all planned expenses and revenues. On my own explanation budget is a written plan (written not verbal so that I won’t forget) on how to manage my money.

Having a budget allows us to get handle on the flow of our money. How much are coming in and where it goes or where we use that particular amount of money. By having a budget you can easily allocate your money from most priority expenses like basic needs (foods, clothes etc.), paying water, electric and rent bill, paying contributions (SSS, Insurance, etc.) and also paying your debt to less priority expenses like cell phone load, travelling and eating outside causing additional too much spending etc. We can cut if not then we can lessen this less priority expenses so that more amount of money can be allocated.

Budgeting can limits ourselves from spending too much, we can be able to save little by little and live within our means. If we were strictly follow our budget. It also helps us to prevent from impulsive buying and keep us away from debt since we already know what amount of money we need to spend.

And last, having a budget it will help us to determine specifically how much amount of money we need in order to meet our needs. So that we can protect our money and do some adjustment in our finances if needed to generate more income or we are doing fine.

Do you have a budget now? If not, then start making a new one, it is the first step to free yourself from debt. And make our life easier and better by budgeting our money.

Fatten Your Wallet Not Your Waistline

The New Year is upon us, and for their 2012 resolution many will opt to lose weight. Obesity is one of the biggest epidemics facing many industrialized nations, and because of this, it is often the most popular choice for New Years Resolutions. However, losing weight isn't just good for your overall health, it is good for your wallet too. If you are serious about bettering your finances in the upcoming year, losing weight may be one of the best ways for you to save money both short and long term. Losing weight will help you save money in the following year through:

Limited Healthcare Costs

Being overweight wears your body out. Your organs have to work harder and are often bogged down by fat, your joints work harder to carry the excess weight, and your heart works harder to pump blood to your bigger body. Not only does your body wear out quicker, but you are at a higher risk for diabetes, stroke, and heart disease – none of which come with a cheap price tag.

While Britain does have universal healthcare, the general upkeep of dealing with diseases such as diabetes or heart disease, isn't always covered. In terms of home care or certain medications, some claims may be denied, forcing you to pay out of pocket. By keeping your waistline trim, you will be able to avoid the high fees of caring for someone in poor health which often leave many calling a bankruptcy attorney.

Lower Food Bills

Those who are overweight may not typically eat more than someone who is fit, in regards to quantity, but they do generally eat out more which comes with a high price tag. If you eat out every day for lunch, there is a good chance that you spend about £ 50 a week on lunch alone. If you are also eating out for dinner a couple of times a week, there is probably another £ 40 to £ 50. That is about £ 300 to £ 400 a month that you could save by skipping the high calorie meals out. Not only will you have quite a bit of money left over at the end of each month, but you will drop a couple of sizes too by bringing a more nutritious lunch from home.

Smaller Clothes Have Smaller Price Tags

If you where anything larger than a XL, there is a good chance that you are paying a couple of bucks more for your shirt than someone who wears a XL or smaller. Larger clothing costs more to make, and therefore manufacturers have to increase the costs of the item in order to profit. By shedding some weight, you will be able to fit in to smaller sizes and spend less on clothing.

By choosing to lose weight in the New Year, you will not only improve your overall health, but you will get to fatten up your wallet as well. So do yourself a favor, and set a resolution that will benefit you in more ways than one.

The true point of living by a budget

In a recent post, Matt at the blog One Million and Beyond describes the fluid budget. I was glad to see it because the "fluid budget" sounds a bit like the one my wife M and I are on.

We've gotten to the cash register at the grocery store and had to take things off the conveyor belt because we exceeded our spending limit for that trip. But at times we've also shifted money from one category because we suddenly decided to spend more in another category. As Matt points out, a "fluid" budget that has some give can work.

Most people think of a budget like a pair of financial handcuffs, very tight and uncomfortable. But the point of a budget is not to determine ahead of time exactly what you are going to spend in every category of your life and then rigidly spend only that amount. A budget is just a tool to help you control your spending so that you are living within--or even better, below--your means.

When your budget is working, it feels good. You know how much you have to spend, you're making conscious decisions about what dollars go where, and most importantly, you're not piling up debt.

Accomplish those things--whether using a rigid or fluid budget--and you'll take a big step toward reaching your financial goals.

More fun at the Carnival of Personal Finance

I saw Matt's post at this week's Carnival, hosted by Christian Personal Finance. Here are couple more of my (and the editor's) picks from the week's selection:

The whole armor of personal finance. At Debt Free Adventure, Matt draws an analogy between the armor of God described in Ephesians 6:10 and the "armor of personal finance." It's a cool and very appropriate parallel (though I prefer the more plain-English version of the verse, instead of ye olde King James version). After all, every financial decision is a spiritual decision.

Buy on the rumor, sell on the news. Dorian from The Personal Financier gives his take on the link between investing and psychology, my favorite aspect of money. One interesting thing he discusses here: How the expectation of getting money, in our own minds, is actually more satisfying than actually getting it. Go figure!

Physical and fiscal fitness: More alike than you think

I don’t like exercise. Many people get a lot of satisfaction from jogging or lifting weights. I'm not one of them. In fact, I hate exercising just to exercise. It’s boring.

I understand the importance of exercise, especially the long-term benefits. But that doesn’t motivate me much to hit the gym or the track.

You may face the same issue managing your money. You dislike budgeting. You think investing is boring. You even understand their importance and long-term benefits. Still, you haven’t been able to build your savings, reduce debt, or make much progress on your financial goals.

Habits and goals go hand-in-hand
Being physically or fiscally fit is about developing good habits that last. That’s most likely to happen if you tie those habits to a specific goal or purpose.

A couple years ago, I set my sights on summiting 14,410-foot Mt. Rainier. For six months prior to my climb, I strength-trained in the gym three times a week. I hated just about every minute of it, but I rarely missed a workout. Every leg press and stomach crunch gave me a better chance of checking Rainier off my “bucket list.”

I’ve noticed the same thing when it comes to our household budget. M and I are aggressively saving to build up a large down payment so we can move up from our townhouse to a single-family home. We’ve cut our discretionary expenses by about a third, and things feel pretty tight. But we’ve stuck to our plan—as painful as it has been. We know that every extra dollar we spend takes away from our larger goal.

“Good for you” isn’t good enough
If good money habits haven’t stuck for you, get specific. Instead of “paying off the credit cards,” for example, identify a direct, tangible benefit of reducing your debt. Maybe it will give you the cash to go on that trip to Italy you’ve always talked about. Or to get the mountain bike you’ve been eyeing. Or help get you and your spouse out of marital counseling.

Whatever the benefit, go beyond just dollars-and-cents logic. The more personal, the better. Good exercise and financial habits are tough beasts to master and maintain, even for those who do them well. If you struggle, find an emotional connection. That will turn your initial steps into ongoing habits that you’ll stick with when the going gets tough.

The truth about budgeting

Research has shown that about 40% of all households maintain a monthly spending plan, or budget. While they make up less than half of us, do budget-users know something non-budgeters don’t? Have they discovered a secret to make budgeting less of a chore?

Unfortunately, no. Here are three truths that I've learned about using a spending plan, and that other users would likely agree with:

Planning ahead is hard. Unexpected expenses come up every month and prices on most things (not just gas) continue to rise. Sometimes spending predictions are off—even way off.

Tracking spending is a pain. A purse or wallet stuffed with receipts is annoying. And even with budgeting software, logging all the information can be time-consuming.

Budgets are "restrictive." Yes, a budget will restrict you from buying what you want--especially if you can’t afford it.

So now you know: Budgeting isn’t fun. But that's true about many things in life that are good for us. Watching what we eat and sweating it out at the gym aren’t easy, for example. But the satisfaction you can get from a trim, healthy body makes the effort worthwhile.

Financial talk-show host Dave Ramsey likes to say that folks who get on a monthly budget often feel like they’ve gotten a raise. Such can be the power of planning and knowing where your dollars are going each month. And that can lead to some fun--that you really can afford--in the long run.

The path to wealth is usually a slow one

There are no shortcuts to financial success, but you wouldn’t know it by the Internet. Just Google the phrase “get rich quick” and you get advertisements like these:

“Bring in $100,000 a month: I can teach you how!”

“Turn $600 into $39,000 with the Forgotten Commodity!”

“Earn money fast and LEGALLY!”

Seeking quick riches can spell trouble
The absurdity of the ads’ claims is worth a chuckle. And maybe you've never felt tempted to click one just to “see what it’s all about.” But someone is clicking, and buying into the ads’ promises—otherwise they wouldn’t exist.

“Quick and easy” is a good description for making a box of Mac n' Cheese, not building wealth. After all, “The trustworthy person will get a rich reward, but a person who wants quick riches will get into trouble.” (Psalms 28:20)

Overnight wealth, or lasting peace?
In their research for the bestselling book, The Millionaire Next Door, Drs. Thomas Stanley and William Danko found that “building wealth takes sacrifice, discipline, and hard work”—hardly the stuff offered by the Internet ads above. But chances are most folks wouldn’t click on ads like these:

“Learn the secret to financial success: Spend less, save more!”

“Retire a multimillionaire—in just 30 years!”

“Be content with what you have. Find out how!”

Living below your means, using a monthly spending plan (budget), setting aside money for the future, and avoiding debt won’t you get rich overnight. But they can vastly improve your chances of accumulating wealth in the long run. More importantly, they offer the promise of something much better: lasting peace and contentment.

Want that bank fee waived? Then ask

The ATM receipt I held gave me a sickening feeling. A negative sign showed next to the balance amount.

M’s and my checking account was overdrawn, and I knew exactly why. I’d forgotten to deposit a check I had put in my wallet earlier in the week, which was why I had gone to the ATM in the first place.

The good news is that I didn’t have to pay an overdraft fee, and not because Commerce Bank didn’t charge one (a nice, hefty $35). In fact, it was because I asked them not to.

A benefit of competition
You might be surprised to know that fees at banks, credit card companies, and other financial institutions are often negotiable. Many times—but not every time—you can avoid paying a charge that’s been levied on you for whatever reason simply by contacting the company and asking them to waive it.

Over the years I’ve saved by having the annual fee on my credit card waived, as well as charges for making a payment by phone (when I’ve been a little late mailing the check). Buying my first house, my father encouraged me to push the mortgage companies competing for my business to remove the many extraneous charges ($35 for courier services, $25 for faxing paperwork, etc.) that they like to tack on to provide the loan. Not every company waived every fee, but some did.

The reason financial companies are willing to let you keep your money? Competition. Losing your business to another bank or credit card company costs them much more than losing the revenue from a one-time $20 or $30 fee. Besides, for every person who asks to have a charge removed, there are many more who simply pay it, no questions asked.

Good financial habits help
That said, financial companies are only willing to go so far. If you make a habit of bouncing checks or paying your credit card late, you have little chance of avoiding the resulting penalty charges, no matter how nicely you ask.

In the years M and I have been customers at Commerce, I can’t recall being overdrawn any other time. We also were never late with a payment on M’s car loan, which they financed, and paid it off several months in advance. So the tedious chores associated with being a good financial steward—balancing the checking account, tracking where our money goes—do have their rewards.

Still, being temporarily overdrawn has shown me that I keep the cash level of our checking account lower than I should. I don’t like the idea of keeping a hundred or so “extra” dollars in the account—money that isn’t accounted for in M’s and my monthly spending plan—where it can be easily tapped. But it’s probably better than relying on my memory to make sure I always make our deposits on time.

Charged up about the cost of a cell phone battery

I've been debating getting rid of M and my cell phones. Buying a cell phone battery has pushed me a little closer to hitting "End Call" permanently.

I've had my LG VX3300 cell phone for about 15 months--not that long, in my estimation. I use it only moderately; I rarely go over the minutes in my service plan and I turn it off when I'm at work. So the fact that the factory model battery recently stopped holding its charge for any length of time was annoying enough.

Then I went to my friendly local Verizon accessory dealer for a replacement. The pricetag: an appalling $49. More than twice as much as I expected. As M pointed out after I got back, "For that, you could have gotten a whole new phone."

I want what I want
Yes, I could have. But I didn't want a new phone. My phone serves my purposes well enough. I don't need a cameraphone, a webphone, or a phone with the ability to answer e-mail.

And I definitely don't want a new cell phone plan, which cheap new phones often come with. I can't wait for our current two-year contract to run out so we can unload it from our monthly budget. I'd rather put $82 toward CJ Jr's college fund--which we've temporarily stopped contributing to, since we went to one income--than give it to Verizon.

I've considered paying the cancellation fee. Dishing out the $150 for each of our two phones is less than half than amount we'll pay ($738) for the next nine months to finish out the contract. But I just can't stomach putting out that kind of money for absolutely nothing.

Two big errors
I do shoulder some of the blame for my battery "overcharge." I didn't shop around beforehand, as I normally do. Afterwards I found one online for half the price.

I also took CJ Jr. with me on my little errand. I may have been more inclined to go to a couple different places, or even ask the Verizon guy about other options, if I had been able to keep both eyes on the cash register instead of one eye on CJ.

Now M and I have to revisit our January spending plan and figure out where that extra $30 or so will come from. That may not sound like much, but it eats up a little chunk of our expected household expenses for the month, which we try to keep as fixed as possible.

Besides, I just wanted a battery, at a reasonable price. Is that too much to ask?

Good personal finance advice for your ears

I love my iPod. Listening to podcasts of radio shows from Dave Ramsey, Crown Financial Ministries, and Charles Stanley make my hour-long commute to and from work an education rather than just a grind. (In fact, I rarely listen to music.)

I'm going to add another show to my podcast favorites: "The Color of Money" from National Public Radio (NPR). It airs every week on NPR's "Day to Day" show. Michelle Singletary, the personal finance columnist for the Washington Post, is the primary contributor. The segment covers the usual range of topics, from saving for retirement, college, etc. to tips on starting a business.

Maybe the best part about it: It's informative and short, about four minutes long. Plus, with the podcast, no endless NPR fundraising segments to sit through in the fall and spring.

A Penny Saved hosts Carnival
The list of submissions to the weekly Carnival of Personal Finance seems to get longer and longer. This week's carnival is at A Penny Saved, and since there are so many choices, here are a few from the bottom of the list you otherwise may not have seen:

• The pursuit of the perfect savings rate at "My financial journey."
• 13 ways to save on gasoline, at "How to save money" (though you need to live near an Indian reservation for one tip).
• How persistence will make you rich someday, on "Money Smart Life."

Calculator gives you the basics for creating a budget

The thought of creating a family budget stops many people dead in their tracks. They look at the stack of bills and receipts on their desk, and suddenly cleaning out the garage is more appealing.

Often the reason is because folks don't know where or how to begin. But when it comes to setting up a budget, you don't have to recreate the wheel--there are any number of tools out there to get you started.

Take the "Ideal Budget" calculator on CNNMoney.com, part of its Money 101 series on the basics of personal finances. The "Ideal Budget" doesn't quite live up to its name in my book, but it's a quick and easy way to give you the basic framework for your own budget.

A broad financial picture
With the Ideal Budget calculator, you first input the amount of your income. Then you enter your expenses, in five broad categories: Housing & Debt, Taxes, Insurance, Savings and Investment, and Living Expenses. The calculator shows the percentage of your income going to each specific category, and provides an "ideal" budget allocation to see if you're spending too much or too little in one area.

It took me all of about 10 minutes to enter my family's information, though admittedly I have most of that information available at my fingertips. If you don't keep track of your expenses regularly or can't remember what you did with your last paystub, it will take you a bit longer.

I liked the fact that the budget was organized into just five expense categories. If you're just starting out making your first budget, simplicity is key. You need to have enough categories to make the personal financial "data" you're gathering and tracking helpful, but not so many that it's an administrative headache.

Not perfect categories
But I question a couple of the specific categories the Ideal Budget uses. For instance, I don't see a whole lot of value in budgeting your taxes. True, taxes are a big expense, but they are what they are. Most people with a steady paycheck or mortgage payment pay the same amount each month. If you're overspending in one category, you wouldn't be reducing your taxes to make up the difference. M and I base our monthly spending plan on after-tax income, which is truer to the actual income we have to spend.

I also don't like grouping Housing & Debt together. Yes, your home mortgage (if you have one) is debt, but it's also an investment--much different than the credit card balance you have for that plasma screen TV, or your new car loan. It's much more revealing to give your consumer (i.e., non-mortgage) debt its own place in your budget, and see just how much of your monthly income it's consuming.

Percentages can be questionable, too
The "Ideal budget allocation" percentages provided with the calculator are helpful. Some of the most common questions folks have about their finances are, "How much should I be spending per month on my house? On groceries? On entertainment? etc.," and the calculator gives a basic idea.

But like the categories themselves, the percentages come with some caveats. The calculator lists 25% as the ideal amount that should go for taxes, an amount which realistically could vary by the individual. It lists just 26% of income going for living expenses, but includes everything from food and clothing to gasoline and utilities. I don't know where the folks from CNNMoney live, but in New Jersey, the cost of living is probably higher than 26 cents of every dollar.

One "Ideal budget allocation" I agree with: 15% for Savings and Investment. That's truly an ideal figure, based on the fact that the U.S. savings rate has been negative for the past year, but one well worth striving for.

A first step worth taking
Judging by the "Ideal Budget," my family's in pretty good shape. We have little debt, so we're well below the 30% ideal allocation in that category. Our living expenses are running about more than a third of our income, which makes me question the cost of my 105-mile roundtrip daily commute--but since I love where I work and where I live, that's probably not changing.

If you've never created a budget before, the Ideal Budget calculator is worth a try. At least you'll get to say, "So that's what a budget looks like...!" But keep its limitations in perspective and think about how you could tailor it to your own needs. Hopefully, it will encourage you to put off cleaning the garage for another week.