Sometimes, people wonder whether I really read all the comments on my blog.
I do …
… even when I just got back from a nine-day vacation with my wife and kids.
You see, I just got back from the Bahamas. Technically, I’m “out of the office” until Monday, so my beautiful wife, Lily Tirone, is going to shoot me if I spend too much time writing this. But just to prove to you that I do read every single comment, I wanted to respond really quickly to one of them from last week’s email and blog…
One of my readers asked why I didn’t take a simpler vacation with all the kids instead of buying all those plane tickets and hauling my brood through security. True, we could have driven just 20 minutes and had a nice family vacation. I could have saved the money on airfare and taken my wife to the Bahamas another time.
But here’s the thing…
If I took the kids on a trip down the road, I would have ended up working a ton more than I worked. It wouldn’t have been enough of a change in scenery to cause me to make the psychological shift necessary to focus 100 percent on my family.
Because I was a very long way away from home, I felt separated from all the distractions. In fact, I didn’t checked in with my staff while I was in the Bahamas. Lily, the kids, and I enjoyed our time together, and I made sure that my time was protected so that I could spend it with the people who matter most.
I’ve found that in reaching a goal, it is critical to create an environment that allows a psychological shift to occur. This is true with the delicate balancing act of family and work. It’s also true when it comes to getting your finances in order.
If you are struggling with debt, credit, or other financial problems, ask yourself how you can change your physical environment so that you are more likely to create the psychological shift necessary to fulfill your financial goals.
Maybe that means logging your purchases and reviewing your budget monthly. Maybe it means dedicating 10 minutes a day to reading books about financial management. Maybe it means joining Debtors Anonymous.
And be sure to share your ideas below! I promise to read them all!
Author: Philip Tirone
“I need a personal loan quick but I have bad credit”
“I need a personal loan quick but I have bad credit.” An old friend of mine was calling for advice. “What’s the best way to get my hands on money? Should I go to one of those places that offers instant cash?”
If you are like many cash-strapped Americans whose scores fall below 720, you should–of course–learn how to build credit. But what do you do in the meantime?
You might think you must rely on high-interest loans with large penalties and lousy terms. But sadly, too many people desperate for money end up exacerbating the situation by applying for loans intended for people with bad credit, which guarantees that they will pay extra fines and interest rates. The irony, of course, is that people with bad credit are the ones who are least able to afford these loans.
If you find yourself saying, I need a personal loan quick but I have bad credit, consider one of two options:
1. If you have a long and strong relationship with your boss, ask for an advance. This is an interest-free way to secure some quick cash, and your boss might let you pay the loan off slowly by simply taking small deductions out of each paycheck.
Only implement this strategy if:
- You have been at your job for more than one year,
- You have a strong relationship with your boss, and
- The company has a solid bottom line.
You should also pay close attention to the amount of the loan. After working for me for only three weeks, a former housekeeper of mine once asked me for an advance on her salary.
“I need a personal loan quick but I have bad credit,” she told me, begging for 10 percent of her salary! I had no idea whether she would work for me long enough to repay the loan, nor did I know whether she was the type of person who took her financial obligations seriously. I refused her the loan, and our relationship was permanently scarred.
To protect your relationship with your boss, follow this general rule:
If you have been employed for more than one year but less than two years, ask for no more than 2 percent of your annual salary. Your boss might feel comfortable lending you 5 percent if you have been with the company for two to three years; if you have been working for the same company for more than three years, you might be able to secure a 10 percent cash advance.
2. Another low-interest option is to ask a relative for a loan. Be upfront about your situation, but be businesslike. Instead of calling in a panic and saying, “I need a personal loan quick but I have bad credit,” try writing out an agreement that details interest, when the payments will be made, and what you will provide as collateral in the event you are late with a payment. By putting everything in writing, and making every payment on time and in full, you will preserve your relationship and secure a low-interest loan.
Finally, be sure to register for our free teleseminar so that you will never again need to say, “I need a personal loan quick but I have bad credit.”
Teaching Children About Credit Cards
With the past 18 months reminding us to be thrifty, many parents are realizing the importance of teaching children about credit cards. In particular, we need to teach children how to build credit by using credit cards wisely and, perhaps more importantly, how to protect their finances from misuse of credit cards.
Though the Credit Card Act of 2009 intended to protect consumers from the credit card industry, the truth is that we should be equally concerned about protecting consumers from themselves! Without proper education, our children risk repeating our mistakes. Indeed, “just charge it” seemed a mantra in the 1990s and early 2000s. Middle-class families ended up paying tens of thousands in interest rate debt.
Leveraging the lessons we learned from the recession, we should all begin teaching children about credit cards so that future generations make wiser choices when it comes to charging debt.
Teaching children about credit cards starts at home by allowing your children to make small, approved purchases with your existing credit cards. I know this sounds crazy, so let me clarify: I do not think you should give your child unlimited access to a credit card with a $20,000 limit. That would be a recipe for disaster.
But how about handing your seven-year-old daughter your credit card when she wants to purchase an $11 toy? Allow her to participate in the process by handing the credit cards to the cashier. Tell her to hold onto a copy of the receipt showing you how much money she owes you. Then have her repay the debt by handing you cash she earns from household chores or an allowance.
And how about older children? Teaching children about credit cards can continue when your children enter their teen years. Hold monthly finance and credit meetings where you review credit card statements, discuss interest rates, and explain how the credit scoring systems works. Consider your own “credit card score,” a term I coined to describe how helpful a person’s use of credit cards is in building his or her credit score.
If your finances (and your utilization rate) can handle it, allow your teenager to make a larger purchase. Then charge interest. If your child fails to make a payment on time, charge a late fee.
Do not, however, get angry or ground your child. When teaching children about credit cards, try to establish a scenario that would happen in real life. The credit card companies would never ground a customer for failing to pay a bill on time. They would, however, call their customers at 8 a.m. to remind them that the bill is due. Feel free to call your teenager’s cell phone at the crack of dawn to remind her that her payment is past due.
In fact, you should embrace a mistake that your child makes while at home. Learning lessons early, when the repercussions are minor, is far better than learning them when the stakes are high.
The Secret to Personal Wealth Through Time Management
You’d be hard pressed to find someone who hasn’t heard the familiar saying, “time is money.” We all know it’s true, but at some point we’ve lost the correlation as to just how much wasted time really affects our financial growth. There’s a lot to be said about time management and its effect on your wallet. It basically boils down to the simple fact that what you decide to do with your time directly affects your personal financial growth.
When you realize this, you come to the understanding that as much care should be given to what you do with each hour of the day as you give to how you spend or allot your income. There’s a basic truth that the more value you can produce, the higher your income potential will grow. If you can produce twice the amount of value in half the time, then you’ll effectively quadruple your income potential. If you’ve been one who’s prone to pushing off organizational tasks, this is a solid argument for taking that necessary admin time to really make sure you’re getting the true value out of every minute you’re awake… and possibly even the minutes while you sleep!
How should you organize your day to take the most advantage of the wealth opportunities out there?
To make this decision, you really need to decide what you want from your day. What are your time management priorities?
- Do you need more independent time to focus on projects?
- Do you need more organization so you can double up on tasks and get more done in less time?
- Do you need help handling tasks that are taking you away from income generating tasks?
The time you spend analyzing your needs and desires will be rewarded with a more streamlined and efficient plan of action. You’ll also see what’s really important to you so it will be easier to prioritize tasks. Maybe cleaning the house yourself isn’t as beneficial as hiring someone so you’re freed up to write more blog posts or finish up more client work. It’s possible you might need to restructure your work day to find more time to work without distractions.
Whatever your desires, take time to structure an outline of how you want to spend your time. For instance, you might want to plan your schedule in blocks of time per day or even by days like the following plan:
- Monday – catch up work day
- Tuesday & Wednesday – no distraction work days
- Thursdays – conference calls and meetings
- Fridays – winding down, tie up loose ends and get ready for the next week.
However your overall plan is laid out, the point is to create something that works for you and allows you the freedom to really create more value.
What should you focus on day-to-day?
The above will help you structure your long-term time management goals, but the real action gets done on a day-to-day basis. For this, you need to break down each day by what you absolutely need to get done. This is best accomplished with a simple method that easily duplicated. Let’s face it – a sculptor doesn’t start with a beautiful piece of art. They have to spend each day focusing on small elements that will eventually give way to their masterpiece. The same is true of your daily time management.
Every night or every morning, make a list of what specific things you need to complete that day. Don’t make a huge list, just decide on three to four things you absolutely MUST finish that day. This will help keep you focused throughout the day when distractions come in. Obviously, some days just tend to snowball with emergencies and potential fires to put out, but overall you should notice a huge improvement in what you’re getting done with the simple daily task list.
Final words of wisdom…
When you’re planning, there are certain traps that can lead to wasted time. To help you avoid some of these common pitfalls, try a few of these tips:
- Always try to multi-task errands whenever possible. Don’t expend unnecessary gas or expensive time with wasted trips.
- Be honest and over-allowing when factoring in how much time you think it will take to complete a task. If you have three task to do that day and they each take four hours to complete, chances are you won’t get them all done.
- Plan out your day in blocks of time. For the most effective productivity, you need to have a 20 minute break every hour and a half. This allows you to reset and actually work for longer “optimal” periods of time throughout the day. Schedule your to-dos around these 90 minute blocks and you’ll notice a vast improvement in not only what you get done, but also the quality of your work.
- Set a timer for when you browse social media sites or you’re doing research. Both of these activities can zap your time without you even realizing it. Setting an alarm to go off in a set time will help keep you in check and will force you to do what you absolutely need to do before your time is up.
- Don’t be afraid to close the door, ignore phone calls or to just say no. Everyone always seems to want a piece of your most valuable asset. Honestly, can you really afford to throw your time away to please someone else? If you know you’ll increase your bottom line by spending another hour doing a certain task, do what you need to do to make sure that time is uninterrupted.
By now, the phrase “time is money” should have taken on a new significance! Share what you plan on doing to increase your wealth through the use of time management below!
Best Finance iPhone Apps
Sometimes all we need to keep track of our personal finances is a little convenience and information whenever and wherever we are. These apps help you gain the freedom you desire to make informed decisions and keep an eye on things no matter what you’re doing. From bill paying to watching your stocks, you can find an app for just about anything you need to help manage your finances. Here are some of our favorites to get you started:
Pageonce Money & Bills App
This app had its beginning as a Personal Assistant and has evolved into probably the most comprehensive personal finance app available. You can track bills, bank accounts, credit card transactions, frequent flyer miles, cell phone usage, investments and so much more. The basic app is free or you can download the pro version for $12.99.
Snap Tax App by Turbo Tax
Is filing your taxes as easy as 1,2,3? With the Snap Tax App, it could be. First, you take a picture of your w2 form. Then you fill out a few questions. Lastly, review your information and e-file your taxes. SnapTax is $9.99, which includes federal and California state preparation and e-file.
Yahoo! Finance App
Need to keep track of all of your stocks? This app is not only convenient, but beautiful as well. The colorful interface helps you see at a quick glance how your stocks are performing. Need the latest financial news? Don’t worry, it’s in there too! The best part? It’s FREE!
Mint.com iPhone App
Love Mint.com? Then you’ll love having access to all of your information wherever you are. Check accounts, make budget decisions and manage your personal finances in real time and on-the-go.
Bill Tracker & Debt Tracker Pro
Two great apps from SnapTap, Bill Tracker and Debt Tracker Pro create a complete personal finance system at your fingertips. Track information about each bill including due date, amount due, whether the bill has been paid, confirmation numbers for payments and more with Bill Tracker. Get a handle on any debts with DebtTracker. DebtTracker can calculate a payoff plan for your debt using the popular debt snowball strategy or give you a customized plan.
Mobile Banking Apps
When you’re on the go and you need to access your accounts quickly, these apps will help keep you up to date.
Wells Fargo Mobile App
Bank of America Mobile App
USAA Mobile
Chase’s Bank Tracker Mobile App
Now that we’ve shared ours, it’s time to let us know your favorite personal finance apps! Leave your comments and suggestions below!
The Truth About Closing Credit Card Accounts
When you’re in over your head or you’ve had a bad experience with something, your natural reaction is pretty much always going to be to steer clear of the cause for some time. With credit, this typically means cutting up credit cards and closing credit accounts. Unfortunately, when it comes to your credit score, this is one of the worst knee-jerk reactions you can have. On the surface, getting rid of your accounts makes a lot of sense. You’re having debt issues, so get rid of the source of the problem and your credit problems will start to disappear. The little known fact is that this can actually make your credit issues even worse.
Let’s look at this a little closer. Fifteen percent of your credit score is derived from the age of your credit cards, with older credit accounts giving you a better score. This part of your credit score is based on the average age of your accounts. As a result, every time you terminate older accounts, you drive down the average age of your accounts considerably and risk decreasing your credit score.
Another factor to consider is your recent credit history. The credit bureaus base their evaluation of your credit worthiness on your account activity. If you close your accounts, there’s no activity for them to evaluate. This can result in a lowered score because they have no current data to determine whether you are a responsible borrower.
In addition to your account activity and age of your credit cards, your credit score is also affected by your overall utilization rate. Your utilization rate is your percentage of debt compared to your credit limit. Credit bureaus reward consumers who keep their utilization rate below 30 percent. If you close an account, there’s a good chance your rate will go up and can directly affect your credit score.
If you are having issues with paying a card, some options you might want to consider include transferring some of the debt evenly across other cards so you keep your utilization rates below 30% on all cards. If you’re not able to do that, start reducing your debt and making your way to the 30% utilization rate by making regular monthly payments. A steady history of payments will demonstrate to credit-scoring bureaus your ability to manage your accounts and will eventually improve your credit score. You’ll want to pay special attention to the oldest accounts with the highest limits and lowest interest rates.
The First Thing You Should Do to Correct an Error and Build Your Credit Score, by 720 Credit Score
If you want to learn how to build credit and raise your credit score, you simply must pull it.
I’m talking about your credit report.
I tell my clients that they must review their credit report at least once every six months, and, depending on how low their credit score is, perhaps even quarterly.
In Step Five of my book, 7 Steps to a 720 Credit Score, I explain that almost 80 percent of people have errors on their credit report, and 25 percent of these are severe enough to cause a person to lose a loan or a job opportunity.
So what do you do if you spot an error?
First and foremost, if you think you are a victim of identity theft, call the three credit bureaus right away to put a freeze on your credit account. This way, no one else can open credit in your name.
If the mistake doesn’t seem to indicate that you are a victim of identity theft, you can start by filing an online dispute at each of the three credit bureaus. Following are links:
As well, contact the credit card company or the bank in question. If they are reporting incorrect information, you can get the ball rolling by asking them to investigate the mistake.
One of the most common (and dangerous) mistakes you will find is an inaccurate credit limit.
So why does an inaccurate credit limit hurt your credit score?
The credit-scoring agencies give higher credit scores to people with lower utilization rates (your credit card balance as a percentage of your limit.) If your limit is, for instance, $2,000, and your balance is $600, you have a utilization rate of 30 percent.
This is a good utilization rate, and it should help your credit score.
But if your credit card company is reporting your limit as $1,000 instead of $2,000, your utilization rate will appear to be 60 percent (a $600 balance on a $1,000 limit). This is a bad utilization rate, and it will cause your score to drop.
So if you want to build your credit score, start by filing a dispute with all three credit bureaus. At the same time, place a call or send a letter to your credit card company demanding that they report your correct limit.
Then, be sure to pull your credit report again to make sure that the mistake has been corrected.
Oh, and one more credit repair tip: Your credit score will never be damaged if you pull your own credit report. Though inquiries into your credit score by lenders will cause a dent in your score, pulling your own credit report is considered responsible behavior. So do it freely!
Have any questions? Need a credit repair tip that will help you build a 720 credit score? Be sure to leave a comment below.
Build Credit: The Three Keys to Creating Good Debt
At first glance, the words “good” and “debt” don’t seem to be a symbiotic match, but there are indeed some instances where creating debt does generate a surplus of income or personal wealth. There are certain schools of thought that agree if a debt is going to increase your potential for income, it could be a good opportunity. However, many people don’t stop and think before they agree to take on a new financial responsibility. If you’re currently considering obtaining a debt to help get you through a specific situation you may want to keep these following advice in mind.
Always Question Your Motives
A good rule of thumb to follow when considering creating a debt is to ask yourself the following question.
“How is borrowing this money going to help me make money or get me out of debt?”
If you’re using credit to do your basic living, you’re not helping yourself pay down your debt, or even create new income. You may feel temporarily relieved, but in actuality you’re increasing your debt and just pushing off the inevitable need to pay until another day. If you approach debt from the perspective of using it help you create wealth, you’ll have a much healthier personal financial situation.
So, in short, if your motive is to create more debt, it’s not a good idea to keep digging yourself into a hole. However, if you are using the debt to increase your opportunities to generate more or new income, it may be the right move for you.
Determine What Is A Good Debt
An easy way to decide what a good debt for you would be is to determine to what degree that debt will increase your wellbeing or expand your potential financial growth. For some ideas, consider these five scenarios for creating good debt:
- Take out a loan to start a side business or to expand your current business. However, you’ll want to get the loan in your business’s name as soon as possible so that your liabilities are divided.
- Get a college education.
- Take a class or learn a skill that will help you be more employable. This can be anything from going to therapy to becoming a better communicator or even taking a sewing class so that you can sell your creations on Etsy.
- Consider getting a consolidation loan with lower interest rates.
- Buying a home or some other investment that is going to increase in value is also good debt, albeit with a bit of risk. Before you buy a home, you have to think worst-case-scenario: If this home never increases in value, can I always afford the payment?
Investing in Your Family
It isn’t a traditional approach to personal finance or debt to consider investing in your family, however, while it may not increase your revenue stream directly, it does increase the overall quality of your life and the future of your family. The main factor to consider before you agree to the debt is to honestly answer, “Can you afford to pay it back?”
If you don’t have solid proof that you can pay it back, it would not be financial prudent to consider it a good debt. The key here is establishing solid proof that you can pay it off. Many people have a feeling they can pay it back, but don’t run the numbers to determine whether that feeling is based on fact. To establish proof, you need to know exactly what you need to live on each month and exactly what income is coming in. If you have enough left over to cover the new debt comfortably, than it might be something of value to consider. Some examples of investing in your family include:
- Investing in your family’s future by sending your kids to college.
- Hiring a tutor for your children.
- Sending your overworked spouse on a vacation to relive their stress.
- Buying a home that your family is going to live in forever might be good debt even if it’s a seller’s market and the home is likely to lose value.
When it comes right down to do it, life is a balancing act. Some people preach that you should never use credit unless it can increase your income. All other debt is bad debt. That isn’t always the case, and you can’t live your life by absolutes. There are some times in life when you will need to use credit and pay interest for things that will increase you or your family’s well-being. The trick is in making educated financial decisions and balancing the risk of the debt versus the opportunities it will create.
How have you used debt to increase your wealth or help your family? Share your stories below!
Lily Tirone and I hauled 3 kids through security…
Would I rather be glad I bought the latest iPhone, or be glad I saved money for a vacation so that I can relax with my amazing wife Lily Tirone?
That’s the question I posed last week, when I suggested that you ask yourself a simple question before making a spending decision …
At the end of my life, would I rather have this or that? (If you missed this post, you can read it here.)
This is Part 2 … a follow up on last week’s post. I wrote it on Tuesday because a lot of people pointed something out …
This question can be applied more broadly and expanded beyond the topic of finances. It can be asked to guide the choices we make and determine whether these choices are in line with our life values.
This week, something came up that hit home for me …
My wife (Lily Tirone) and I are taking our kids to the Bahamas.
I want you to have a little taste of what my family looks like, so I’ve posted a picture below. My oldest, Ava, is five. Dominic is almost four, and Luke is about two and a half.
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At any rate, this is a really special vacation because it is probably the last time the Tirone family will take a vacation together … just the five of us.
See, Lily is about three months pregnant, so in six months, Baby #4 will be here, and the Tirones will be a family of six!
Now, if you are a parent, you can probably imagine what it’s like getting the Tirone family through the airport. Lily and I have three car seats, a triple stroller, bags of baby gear, books for the kids to read, toys … the list goes on and on.
Lily and I basically look like pack mules, and no one ever wants to be behind us in the security line. Frankly, it’s kind of a nightmare.
It’s really tough traveling with three young kids, and both Lily and I have had thoughts of not going … it would be a lot more convenient to just stay home.
But if we stayed home, I’d inevitably end up working. I know I would. In the Bahamas, I’ll turn off my cell phone. I won’t check my email. I’ll tell my staff to call the hotel room only if someone is bleeding.
The Tirone family of five will be able to spend some really special quality together-time.
And at the end of my life, I’m going to say, “I’m sure glad I spent that time with my kids and with Lily. I’m glad Lily and I hauled my unruly young kids through security line and suffered the headaches.”
If we decided to skip the vacation, I’m positive that I would never look back and say, “Boy, I sure wish I hadn’t gone on vacation with my family and had stayed home and worked instead.”
Every single time we take a vacation together, our family grows closer and closer.
In fact, when I come back, I’ll tell you what I learned on this trip!
For now, I just want to encourage you to remember to make choices — financial or otherwise — that reflect what you want long-term. These choices might be inconvenient in the short-term, but if they honor your life values, you won’t look back and regret them!
If you have any thoughts about this, or if you want to share your stories, be sure to post a comment below!
– Philip Tirone
“Buy Now Pay Later No Credit Check
Are the buy now pay later no credit check offers good for your credit score?
Probably not.
As you learn how to build credit, you should consider that certain credit types of credit, including buy now pay later no credit check offers, will probably hurt your credit score.
You can probably surmise that buy now pay later no credit check offers usually come with Goliath-sized interest rates. People who apply for these loans are often risky borrowers who are unlikely to repay their loans, so creditors who offer buy now pay later no credit check loans know that many of their customers will default once the grace period expires. To make these loans worthwhile, creditors attach high interest rates. The people who do repay their loans pay an arm and a leg in interest to compensate the creditors for the cost of those who default.
Aside from the high interest rates, buy now pay later no credit check offers are probably a bad idea for another reason. The creditor might not check your credit before granting you a loan, but the creditor will most certainly report the buy now pay later no credit check offer to the credit-scoring bureaus. And credit scoring systems frown upon any buy now pay later loans. These loans suggest that the borrower is not currently able to meet the financial obligations of the loan, and this gives the credit-scoring bureaus reason to believe that you are a credit risk.
One of the rules of how to build credit is that you should never do anything that suggests you are experiencing financial strain. Even if you plan to repay the loan in a timely manner, the buy now pay later no credit check loan tells the credit-scoring bureaus that you are in such a financial bind that you will agree to sky-high interest rates. A person whose finances are stable probably would not agree to high interest rates, so credit-scoring bureaus will lower your credit score if you apply for these loans.
One more reason to steer clear of buy now pay later no credit check offers: These loans often result in a high utilization rate. Remember that your utilization rate is the balance you have on a loan or credit card as compared to the limit. The lower your utilization rate, the better your credit score. Because the balance on these loans often does not decrease for many months (remember, you will pay later), your utilization rate stays high until you start paying.
Though the buy now pay later no credit check offers might be tempting, if you really want to take the steps and learn how to improve your credit score, you should turn your back on these offers.
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