FINANCE MANAGEMENT TIPS

For consumers who do not properly mange their finances, the specter of having their life savings dwindle away, not having the funds to cover an accident, or having to delay retirement are very real possibilities. Americans scored a "D" in financial literacy according to a recent Bankrate.com survey, Please examine the following personal finance management tips if you really want to help yourself get on top and stay on top of your finances.

1. Avoid letting your future become depressingly bleak - seek dependable advice from an online source, a reliable family member or a certified financial advisor for your financial planning. The Financial Planning Association and the Security and Exchange Commission's Investment Advisor Board are excellent sources for finding certified financial planners.

2. When reviewing your monthly budget, does your cash flow seem to be rushing down the drain? Keep records of how much and where you are spending your money. Financial obligations have to be met every month, so pick a date at least once a month for this review and be diligent about always keeping that date.

3. Hundreds of millions of dollars are spent each year on consumer credit card fraud. Protect yourself by monitoring and tracking your purchases daily. Check out the tips on our Debt Free Home page on how to prevent fraudulent credit card scams.

4.  "Robbing Peter to pay Paul" is a terrible trap to fall into. Avoid this trap by making a realistic spending plan and sticking to it. Review and update your expenses at least every 2 months. You must plan how your income will be used or someone else will!  Save your receipts, record your expenses in a notebook, or use whatever is best for you to track your expenditures.

5. Credit cards with high interest rates should be paid off first. When you eradicate the obscene finance charges of 20% and more, you will in fact be acquiring that money back. According to the American Bankruptcy Institute, personal bankruptcy fillings totaled 1,613,097 - an all time high for any 12 month period, up 10% from the previous year.

6. Big ticket items such as cars, motor homes, boats, etc. depreciate rapidly. Many consumers find themselves "upside down" on their loans (owing more money than what the item is worth). Instead of new, consider buying these items used, which oftentimes can help you save up to 40%.

7. Medical emergencies, the loss of your job or other unforeseen expenses can throw you into a debt spiraling downward. Try to develop a three to six month cash reserve fund to handle such emergencies.

8. Reduce the  high monthly payments on medication, insurance, phone and TV service, memberships, etc. by getting better deals with different vendors. Learn about the different types of insurance available and spend your money wisely (for example, term instead of whole life). Choose higher deductibles to lower your premiums.

9. Reducing your liabilities and increasing your assets is the only way to see real financial progress. Financial goals should be established and written down. You and your family should set short, medium and long term objectives. Your goals should be reviewed and updated minimally once a year. Keep on top of your finances by taking courses, working with a   financial advisor, and reading regularly.

10. Don't be one of the statistics of the 2.3 million households that will have to postpone retirement because of being trapped under a mountain of debt. Build a financially strong and varied retirement plan and stick to it.

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