These days, it’s all online – even personal finance programs, which once were the exclusive province of Quicken and Microsoft Money have now been supplanted by online person finance program. But which one is the right choice for your personal needs? To answer that question, we looked at five of the most popular online personal finance programs and dissect what each one does and why it may or may not be the perfect fit for your needs:

Mint.Com

By far the best known of the online personal finance programs, Mint suffers from just one thing: it tries to be all things to all people. Now if you aren’t really sure what you need to do (maybe some budgeting, maybe balancing your checkbook, maybe planning your retirement), Mint can be a great choice for the simple reason that it provides you with everything you could possibly want in the way of an online personal finance program. On the other hand, if you have more specific goals in mind, then other tools may be a better choice.

GoalMine

This is a relatively new product on the online marketplace and it’s one of those niche tools which is really perfect for those who have very specific needs. In essence, GoalMine is all about saving money and nothing else. It doesn’t allow you to balance your checkbook or plan a budget. However, if you are trying to save money for something (buying a home, going on vacation, paying off debts, etc.) GoalMine can be an absolute godsend.

In essence, GoalMine allows you to set up various savings goals and then helps you pick one of their products to reach that goal. They offer just three products, a savings account, a money market fund and a mutual fund. However, for those who don’t have a lot of money and who want a simple way to save up money, these are pretty much all you need. You tell GoalMine about your goal and how long you want to take to reach it and they recommend a product and tell you how much you need to invest each month to make it to your goal.

You can switch the numbers around to see approximately how long it will take for each goal (for example, if you want to save $100,000, they estimate it will take 39 years if you invest just $25 per month) as well meaning that you can be more realistic about your savings. You can also post your goals on Facebook to encourage friends and families to help out with reaching the goal.

Buxfer

For those who want similar features to those found on Mint while keeping a very simple interface, Buxfer may be the perfect online personal finance program for your needs. It is designed to be a super simple system which lets you manage your money and budgets. It doesn’t have lots of bells and whistles, but that’s actually by design – they wanted to avoid the clutter that other sites have. They also include tools which allow you to share expenses with someone else, making it a perfect choice for roommates.

Your Bank or Credit Union

While there are dozens of other online personal finance management programs, the fact is that every one of them suffers from one very big problem – they don’t offer you the chance to integrate directly with your bank account. At most, you can simply link it to your bank account and get some access. That’s why many banks have begun offering their own online personal finance management programs. These programs are often third party applications which the banks sign up for, though they are occasionally homegrown. In all cases though, they may well be all you need, thus avoiding the need to share more information with more online services.

George Gallagher works in finance and education sectors. When not writing for the Internet he helps students find private loan consolidation options.

Losing your job can be an extremely traumatic experience, often a feeling of dread creeps over you as you ask yourself “where am I going to get money from to survive?” Unemployment rates are currently extremely high due to the economic crisis and many hardworking citizens are finding themselves being made redundant. If you’ve recently lost your job and are worried about your finances you needn’t feel so low, there are many ways in which you can manage your finances without completely changing your lifestyle.

Assessing a Budget

Firstly, you’ll need to assess your cash flow to determine a feasible budget. Accurately calculate your current balance, any income and your total expenses. When analyzing your expenses don’t forget to include any monthly bills and direct debits. Once you’ve subtracted these from your monthly balance you’ll then need to assess your average cost of groceries, which probably amounts to a significant proportion of your balance. Once you have a rough budget it’s time to assess ways in which you can reduce the costs of certain necessities.

Cutting Down

If your previous job provided you with a comfortable amount of money to spend each month, it’s more than likely there’ll have been luxurious items on your grocery shopping bill. When browsing through the supermarket, look out for deals which can help to get necessary items for cheaper or more items for the same price. If you see an item which you would usually buy but isn’t an essential ask yourself “do I really need this?” Many people overspend when shopping due to temptation of tasty treats. The best way to avoid this temptation – never go shopping on an empty stomach.

Utility bills are arguably a costly monthly expense so shopping around to make sure you’re on the best plan for your household can help you to find a better deal. In some cases, you may find that internet, telephone and television packages are cheaper if you get them all from the same provider. Always check however, that you’re on the lowest plan for your family’s needs – it’s pointless spending excess money on a service if you’re not using it to its full capacity.

Coupon Craze

Coupons are the hottest trend in terms of saving money, for both luxury and necessary items. There’s a coupon for just about anything right now, as more online voucher websites emerge each day. Before buying anything full price check on money saving forums, where people share news of the latest deals and discounts, to see if there’s a coupon for your product, service or outlet.

Coupons enable you to indulge in products, services and events which may be considered as a luxury, even when money is tight. Discount vouchers for restaurants and bars are currently extremely popular as fewer people can afford to dine out at full price. Vouchers are becoming more competitive than ever, which is great news for bargain hunters, with steals such as “buy one get one free main courses and free starter” arising. It’s important to keep your life as normal as possible when unemployed to avoid feeling down, dining out can be affordable for any budget with the help of coupons, so why not live a little?

Find a Job

It’s needless to say that the only way to escape unemployment is to find a job, so you mustn’t forget this! Explore every avenue of offline and online recruitment to find hidden gem vacancies which “every man and his dog” don’t apply for. Social media channels such as Facebook and Twitter can be great places to subscribe to live job feeds which alert you of a vacancy as soon as it appears – meaning you can be one of the first candidates to apply!

The key to managing your finances when unemployed is to combine common sense with thinking outside the box. Try out new ways to live your normal life at a lower expense – the more creatively you think the more normally you will be able to live whilst unemployed.

In the next year or so we will probably start shopping for a house. But before we do, we need to figure out how much we can afford and, more importantly, how much we should spend. Yes, how much you can afford and how much you should spend are two different things.

How much you can afford?

Traditionally lenders rely on two numbers to estimate how much you can borrow to buy a house: Front-end debt-to-income ratios and Back-end debt-to-income ratios.

• Front-end DTI ratio factors in total housing costs including, Principal, Interest, Taxes and Insurance (PITI)
• Back-end DTI ration factors in the above as well as other debts such as car loans, credit cards and student loans

These numbers measure how much of your income goes toward debt each month and determine how much banks are willing to lend to you. For an FHA loan front-end DTI is 29% of gross income and back-end DTI is 41% of gross income. So for someone earning $60,000 a year ($5,000/month), they would estimate you can afford a total house payment of $1,450 a month with total debt payments up to $2,050 a month.

We often solely rely on mortgage brokers to perform these calculations for us, and thus influence how much we spend on a house. I can qualify to borrow more so I should buy more house, right? Back in the days of interest only mortgage payments, I went along with what my mortgage broker told me I could afford, which was about $150,000 over what I originally intended to spend. I purchased way more house than I ever needed and wound up in way over my head.

Remember, lenders will try to determine if you can make a payment, not if you can comfortably make a payment and still save for retirement, pay for your child’s education, go on vacation, etc. Often the amount you can qualify for will leave you without any wiggle room in your budget.

How much you should spend?

The problem with the numbers lenders give you is that they don’t factor in other necessities such as health care, savings and emergency funds. Or other costs such as a college fund, vacations, hobbies, etc. When considering how much to spend on a house, look at your take home pay and settle on a number that is comfortable that still allows you room to continue to do the things you enjoy as well as pursue other financial goals. Remember, 30 years is a long time to scrape by paying for an over-sized mortgage.

Often you hear the advice buy as much home as you can afford. Perhaps the better advice is buy only as much house as you need that you can comfortably afford. In the long run you’ll be happier you did.

A recent study showed that over two-third’s of American’s are tired of pinching pennies…are you one of them? I am! We’re saving more, couponing, spending cautiously and as a result we’re suffering from Frugal Fatigue.

What is Frugal Fatigue?

Simply put Frugal Fatigue is the phenomenon that can occur when you’ve been diligently pinching pennies and tracking every dollar you spend. For many of us living, within our means and saving money is a new way of life and it’s hard, right? Well, not as hard as living paycheck to paycheck, not knowing if you can pay the bills and feed your family next month. Setting a budget and sticking to it is hard but the benefits are real and long-lasting.

How Can I Overcome My Urge to Splurge?

Saving is a marathon not a sprint, so you need to prepare yourself to go the distance and achieve your long-term goals. Here are a few strategies to help:

Keep your eye on your goal – Why are you saving? To get out of debt or buy a new house? Or perhaps to take your dream vacation or for a secure retirement? Cut out some images that represent you goals and place them somewhere you will see them daily. Remind yourself what you are working for.

Remember what it feels like to struggle with money – Memories and feelings are powerful tools. When you have the urge to splurge, take a moment to remember how you felt when you started your journey. Personally we’re now in a place where we have a solid emergency fund and will pay off our debt by the end of the year, but I can still feel the knot in my stomach when I think back just a couple years ago when we didn’t know how we were going to pay our bills the next month. Use those feelings, they are powerful reminders.

Budget for small indulgences – Set aside some money each month that you can use for fun. Allowing yourself small indulgences (within your budget) will help keep you motivated to achieve your goals.

Imagine the future – Will you feel better living a life without debt and cash in the bank or with a bunch of things that quickly lose their luster and become dust magnets?

Frugal fatigue is real and affects many of us. But using these techniques it is possible to stay on track and achieve your goals.

Spring cleaning is a time to open the windows and let in the light. One place you should make sure to shine a light is on your finances. While you are dusting, organizing and sorting items around your home this spring, take the time to apply some spring cleaning practices to your finances to make them shine too.

1 – Organize your papers

As you clear out cupboards or tidy up spare rooms you will be freeing up a lot of space you can use for filing. Spring cleaning is the perfect time to implement a new filing system so that you can easily store your bank statements, receipts and other bills, as well as keep personal and business papers separate. You can even aim to do away with your paper filing system all together and apply to have your bank statements and bills sent via email, scan in receipts as you get them and then throw away the originals.

2 – Stop hoarding

While hoarding is usually the domain of old clothes, children’s toys and bric-a-brac, you can also find you are hoarding financial paperwork too. If it is still too soon to throw away some of your papers, as you need to keep records dating back 7 years in most cases, store these older papers in archive boxes which you can pack up out of your way. You can also store important documents such as your birth certificate or house title in archives too because you don’t need access to them every day. Make sure you shred any personal details before throwing anything out.

3 – Check your credit report

Spring cleaning is also a chance to take stock of the changes that may have occurred while you were hibernating over winter. To do this, obtain a free copy of your credit report and check for any mistakes or bills which have been added to your credit report as overdue which you didn’t know about. You can have mistakes removed from your report.

4 – Plan to be debt free

As you get out and enjoy the sunshine, you don’t want your credit card debts creating a black cloud over your day. Therefore, as part of spring cleaning your finances, make a plan to pay off your credit cards. For example, look at transferring the balances of your high interest cards, to one low rate balance transfer card. And if you are due for a tax refund, apply the entire amount to pay down your debts – then hopefully next year you can enjoy your entire refund guilt free.

5 – Review your bank accounts

When you have had the same bank accounts for several years, it’s easy to overlook fees and stick with them. However your needs change over time, as do banking policies, and you may be paying unnecessary fees so take the time to check. There are plenty of no-fee bank accounts.

6 – Review your phone plans

Being in control of your finances is not only about being organized, but also about managing your expenses. You can do this by comparing your phone plans to other offers to make sure you are still getting the best deal for your call and data usages. If you are in the middle of a contract term, determine if the cancellation fee will be outweighed by the savings and benefits of your new plan.

7 – Consolidate your retirement funds

If you have changed jobs a number of times you may have a number of 401Ks or other retirement plans. As you’re going through your paperwork, check the accounts and look for a way to consolidate your retirement savings. This will not only make your funds easier to manage, but you can also cut down on fees and commissions.

8 – Start saving

Whether you want to start saving for Christmas, your child’s education or a long holiday, it only takes a few dollars to start saving – and that is probably the amount you’ve just found in the couch cushions. Compare high interest savings accounts to find a fee free account with a high ongoing interest rate and you will soon see your balance growing faster than a sun flower.

Alban is a contributing author at Home Loan Finder, a home loan comparison website.

I know many of you have resolved to create and live by a budget this year. That’s a great resolution and a pivotal step in taking control of your finances and achieving your financial goals.

To help you out I’ve posted the budget spreadsheet that I use. It’s a simple zero-based budgeting worksheet that you can download for free. Feel free to modify to make it work for your household.

Monthly Budget Worksheet

Good Luck and Happy New Year!

It was just one generation ago that couples and families lived comfortably on one income. And while the cost of living has increased, so too have wages. The reliance families have on two incomes can be wound back to allow you to not just survive, but live well on one salary.

It is a good financial habit to get into – living on one wage and saving the other. However, in some cases you don’t have the luxury of adhering to this habit when it suits you, and splurging when it doesn’ t. Instead you may have to live on one salary because one parent is staying at home with the baby, one income earner has lost their job or become sick or injured.

Whether you’ re choosing to stop work, have been forced into it or are simply trying to be more financially responsible and live within your means, you can live on one salary in your household with just five simple changes.

1 – Prepare if you can

Knowing and being prepared for the drop back to one salary can make the transition a lot easier to deal with mentally and can give you a chance to prepare financially. If you can prepare you should start by:

• Clearing your debts. One of the biggest drains on your finances can be your credit card and personal loan debt – it may even be the reason you are forced to keep two incomes coming in. Therefore, to make it possible to cover your costs with one salary, focus your attention on paying off debt and reducing your expenses.

• Start saving. Once your debt is under control, create a dedicated high interest savings account and put all of the money you were spending into that account, or if you can – start putting one whole wage away in savings.

• Curb your spending. In order to successfully live on one salary you will need to change your spending habits. You will have to cut out a number of luxuries and change the way you look at your essentials – for example you may be able to keep your car, but you can only budget to drive it on the weekends, and you will have to start catching public transport to and from work.

• Knowing how your expenses will change. While you can’ t prepare for the unexpected, you can prepare for what you know. For example, if you’ re going to become a one income family because of a baby, budget for all of the initial and ongoing costs you can expect. If you’ve lost your job you know you’ ll be saving on fuel driving to and from work until you find another job. Alternatively if you’ve been injured or are ill, you could need to budget for new expenses.

2 – Budget for essentials

To see if it is truly possible for your family to live on one salary, create a budget for all of your essential expenses. This is where you need to be able to identify the difference between what you need and what you want – differentiating the essentials from the luxuries. For example, tissues are an essential, but the scented, moisturizing, three ply tissues are a luxury.

Start your essentials budget by entering all of your bills such as your mortgage, insurance, power and water. You’ ll also need to know what your essential costs are for things like your groceries and fuel.

When you know how much you need to survive, chances are you’ ll see that there is room to do more than just survive.

3 – Change your habits

Now it’ s time to put your plans into action and see just how well you can stick to your new one income budget. When you look you will see hundreds of little adjustments you can make to save money, and everyone has their own ways to cut back. You could start with:

• Catching the bus to work instead of driving.
• Cutting back to become a one car family.
• Pack a lunch instead of buying one.
• Have friends over to your house instead of going out for dinner.
• Shop at recycled clothing stores and op shops, or swap clothes with friends and family
• Holiday closer to home, or enjoy a camping holiday rather than a luxury hotel suite.

This is where you will need to break down your life and rebuild it, because we have all gotten into the habit of spending everything we earn – and sometimes more. Instead, you’ ll need to find ways to live within your means, and spend less than you earn.

4 – Have an emergency fund

As a one income family there is much less margin for error when emergencies arise so you need to make sure you have a strong emergency fund – and that doesn’t mean falling back on your credit card. Instead, budget to put away money in a savings account until you have enough to cover six months worth of expenses. For your emergency fund to really be successful, you need to be able to differentiate a real emergency from an urgent impulse.

When you live on one salary a savings plan is important so that you can also save up for purchases, holidays or special treats for the family. It means you’ re not living life on credit and you’ re not going to be drawn back down that path.

5 – Have fun

When you first look at your budget you may be focused on everything you’ re missing out on with less disposable income. However, you can still enjoy your life and in fact, enjoy it more because it is real, safe and secure – you’ re not living on borrowed money.

Instead, you can plan to have fun, and save up for fun, which makes your experiences even better because the saving and budgeting have been worthwhile. You can enjoy the fruits of your hard work and you’ve learnt that surviving – and thriving – on one salary is possible.

Alban is a personal finance writer at Home Loan Finder, which offer information on reverse mortgages.

Dear Bank,

I am writing to inform you that I will not be “opting in” to your Overdraft Protection program. I can tell you are oh so eager to protect me from overdrafts…and subsequently charge me $35 each time. You have, after all, sent me 8 letters on the matter…but who’s counting?

It may surprise you that I don’t want to participate in a program that allows me to spend money that I don’t have. Call me crazy but I believe that if I don’t have enough money in my account for that latte or the latest Justin Bieber CD, I shouldn’t be able to buy it.

I know what you’re saying; what if I don’t know how much money is in my account? Overdraft Protection can spare me an embarrassing moment with the cashier. It’s ok, dear bank, you’ve already got me covered. You’ve made it easy for me to check my balance online, via text on my cell phone…or heck, there’s even an App for that.

And honestly, I can’t think of anything that I need so urgently that I’d be willing to pay a $35 premium.

So thanks, but no thanks.

Sincerely,
An Enlightened Consumer

In this month’s edition of Money Magazine they interviewed 100 dedicated savers to learn their stories and find out the tactics they employ to save 35-60% of their income. All of these couples and individuals are well on their way to a very comfortable early retirement.

1. They set goals, and they make them specific.

Behavioral finance experts have found that earmarking accounts for particular goals can have a dramatic effect on savings rates. In a 2009 study, Amar Cheema of the University of Virginia and Dilip Soman of the University of Toronto found that labeling a college fund with the child’s name nearly doubled how much was saved. “When you know what you’re saving for, it’s close to your heart and you’ll feel regret if you stop,” says Cheema.

2. They live below their means

They purchase homes and cars based on what they need versus what they can afford.

3. They delay gratification

Super savers don’t make impulse buys and often save for months in order to pay cash.

4. They avoid debt

They pay cash, even on big ticket items like cars and houses avoiding thousands, even tens of thousands in interest.

5. They save on the everyday expenses

They are diligent in comparing prices, clipping coupons and scouring Craigslist for deals.

6. They have multiple streams of income.

The have two salaries, live on one and save the other. Or if they are a single income earner they have a side hustle to earn extra cash.

7. They track their spending

In a study of 50 undergraduates, Amar Cheema had students write down every expense for a month. All 50 cut their spending that month by an average of 14%. Six months later, 34 of them were still spending less.

8. They automate saving

They automatically fund 401K, Roth IRA, 529 and savings accounts. They don’t miss the money because they never see it.

I’m pleased that we are doing 7 of the 8 (we currently only have one income) and currently save 32% of our income. But my goal is to get to 50%.

How about you? Do you employ any of these strategies?

Secrets of Super Savers, Donna Rosato, Money, August 2010

It’s never too soon to start saving for retirement. When you’re young time is on your side. If used wisely it’s your greatest asset. However it can be the biggest detriment as retirement seems so far off. It’s easy to put off saving until next year, and then next year, and so on. Next thing you know you’re 45 and wondering why your nest egg is so small.

Likewise, it’s never too late to start saving. It’s better to start late than not at all.

The future is in your hands and so is your financial security. You can’t rely on Social Security, there’s a possibility it won’t be around for you.

20s and 30s

• Max out tax deferred retirement plan contributions – If your employer offers any kind of match to your contributions, be sure to take advantage of that. A 50% employer match means that if you contribute $100/month, your employer will add another $50. And with a tax-deferred plan, your contribution of $100 will reduce your paycheck by only about $80. By giving up $80 of monthly spending, you gain an investment of $150/month. After 25 years with an 8% return, the result is $142,000 for retirement! But don’t stop there! As you start to make more money, minimize lifestyle inflation and put those raises towards retirement savings.
• Fund Roth IRAs to the maximum amount allowed – Funding a Roth IRA provides you non-taxable income in retirement.
• Establish and maintain an emergency fund – Unplanned expenses can derail retirement saving and also send you into debt. Maintain an adequate Emergency Fund to fall back on in case you lose your job, experience a medical emergency or to cover other unplanned expenses.
• Avoid debt – Do you really want to give your hard earned dollars to a bank in the form of interest? Avoid the debt trap and put those dollars in a high-interest savings account and let the bank pay you instead!
• For aggressive wealth builders, acquire a positive cash flow rental property – Rather than rent an apartment buy a starter home or a small apartment building that you can live in now and use as rental units later. A 30 year fixed rate mortgage will be paid off by the time you are ready to retire and you will have inflation adjusted income you can never outlive.

40s and 50s

• Build your financial intelligence to avoid costly investment mistakes
• Create your first ballpark estimate – According to the American Savings Education Council, Americans who have done a retirement calculation have nearly five times the savings of those who haven’t.
• Establish plan to be debt free by retirement
• Consider reviewing your retirement plan with a fee-only Financial Advisor
• Evaluate investments for age/risk profile
• Take care of your health

5-10 Years from Retirement

• Update your ballpark estimate
• Compare revised estimate to current savings. Work to close the gap.
• Are you on track to be debt free by retirement? Work to payoff debt.
• Evaluate investments for age/risk profile
• Determine retirement locale, do you plan to downsize?
• Take care of your health

1 Year from Retirement

• Estimate a budget for retirement
• Consider part time jobs if you need to stretch your retirement savings
• Speak with a Social Security representative to determine when you should apply for benefits.
• Review will and power of attorney; ensure that beneficiaries on retirement accounts are up to date.
• If retirement comes before Medicare eligibility, make plans to purchase private health insurance or continue your employer’s plan through COBRA.

Everyone’s vision of retirement is different. But hopefully with this Retirement Planning Checklist you’ll be able to realize your vision and enjoy your retirement years free of stress and anxiety.