Here are helpful answers to several recurring financial questions our clients have asked over the last 30 years.
Are credit cards good?
Using credit cards wisely allows you to build a good credit score. When you cannot pay your credit card off when your statement is due, your interest charges, sometimes up to 29%, get tacked on each month. You then end up paying more for the items you bought on sale using your card. My rule of thumb is any month you find can't pay off your credit card, stop using it until you can pay it off and get your own aggressive payment plan to pay it off.
When my income is up and down from month to month, how do I live within a Spending Plan and not use a credit card?
The first step to take is to list all your monthly expenses in the Spending Plan. Once you know that number, multiply it by 12 and you will know what you have to bring home each year. In the months you make more than what it takes to make ends meet, put your excess pay into a second account to accumulate it. You will then have money saved for the months you make less than your average monthly expenses. Controlling your expenses determines the monthly income you need to deposit.
How can I save for future expenses when I cannot make ends meet each month?
You probably are not saving for future expenses if you have never been taught to know your numbers. You can start to save by creating a Spending Plan that includes expenses like vacations, Birthday and Christmas gifts, household and car repairs, and taxes. You will then know your numbers and adjust your spending habits as needed or create additional pay. A great way to save for future expenses is when extra money comes along, such as a bonus, tax refund or financial gift, don't spend that money, save it.
How do I give to someone in need if I am not sure the money will be spent wisely?
The easiest way to give is from your heart. When you meet an immediate need, you are an answer to someone's prayers. People feel known and loved by God. The responsibility to spend wisely is with the person receiving your gift. We are all blessed when we take care of widows (and single moms), orphans (their children), and the poor.