First Time Moving Out TIps

First Time Moving Out – Top Tips

It’s a big day in anyone’s life when they move into their first apartment. However, no one just up and one day moves into one. It takes a lot of strategic pre-planning and budgeting because if all goes well, you’re establishing good credit. If it doesn’t, late rent or an eviction is something that can stay with you for years to come. That’s not to scare you. It’s simply to encourage you to do as much preparing as you can so that you can enjoy your first apartment with total peace and no regrets.

Here Are The Top Five Tips For Your First Time Moving Out:

Check Your Credit

9.5 times out of 10, the person that you’re going to want to rent from is going to check your credit and so you might as well before they do. There is a bit of a catch twenty-two here. If this is your first time moving out into an apartment, this might also reflect the fact that you don’t have a lot of past credit history and so while you don’t have any “bad” credit, no credit can be looked upon as being something similar. If this is the case, you can build your credit by getting a prepaid credit card, making purchases and paying them off immediately. You might also want to get a couple of bills in your name to establish payment history as well. However, if time is of the essence, there are landlords that do show some mercy in these matters. They’re usually not commercial property companies, but personal owners. Craigslist is a good place to start looking for people who are willing to work with you even if your credit is not the best (or the most active). Be prepared to pay a steeper security deposit (in most cases), though.

Plan a Budget

Creating a budget will help reduce your stress by making sure you’re financial ready for your first time moving out.  If this is your first apartment, then this is probably your first time paying for a series of monthly bills. Water, electricity, cable and food are not luxuries, they are necessities. This means that you have to make sure that you allot enough every month to cover these expenses. When it comes to the electricity, bear in mind that in extreme cold or heat, the bill will fluctuate (you actually might want to put aside $100 extra bucks in the summer and winter months to cover it).

Shop Around

Like pretty much everything else in this world with a price tag, apartments also have deals going on. Therefore, it’s best to not just go with the first one that catches your eye or works within your budget. If you’ve decided that you want to check out some Upper West Side apartments for rent, do your research: which ones have the most amenities, how much is the security deposit, which ones are close to subway or bus routes as well as cleaners and grocery stores? Also, if you can, try and speak with a tenant or two to get an understanding on what the noise levels are like and if there is staff available to tend to the property in a timely manner. Never look for an apartment like you don’t have options. You always do.

Check Your Lease (and check it twice)

There are a lot of people who find out some things the hard way about their rental agreement because they didn’t read the fine print. For instance, if you are going with a private renter and the lease says “as is”, this means that repairs that aren’t major, they are not liable for (so also do a thorough inspection of the property that you’re renting before signing). Another thing to review is if rent is due on the last day of the month or the first and how much grace you are given to actually turn it in (some places give 5, others may give as much as 10). And, if you’re thinking it’s a place where you’ll want to stay for a while, also be sure to check out what it says about renewing your lease. Plus, if you want to leave after a year, get some clarity on when your security deposit will be refunded to you (something that a lot of people forget about discussing).

Don’t Pay Out-of-Pocket For Repairs

One of the biggest differences between paying rent and paying a mortgage is that when you’re renting property, it doesn’t belong to you. So, when the refrigerator breaks down, the faucets stop working or there are electrical or plumbing issues, they are not your (financial) concern; they are your landlord’s. My first time moving out, I made the mistake of paying for repairs out of pocket.  When there is an issue with your place, notify your landlord. If it’s dire, most state tenant laws make it mandatory that a landlord check out the problem within 24 hours with up to a few days to make the repair. Don’t allow your landlords to cause you to think that you must pocket the expenses. At the very least (with a private owner), work out an arrangement where if you do pay for it (keep all receipts), they will either reimburse you or take it out of the next month’s rent.

Being prepared for your first time moving out will help make this a great experience!

leasing vs buying a car pros and cons

Leasing Vs Buying A Car Pros And Cons

When it comes to their money, some people do inexplicable things. I came across an appalling figure the other day. The average length of a car loan today is 70 months – nearly six years! Now couple that stat with the fact that, on average, people only keep their cars three to five years. If you do that, it doesn’t take a calculator to figure out you’re digging yourself into a hole.  You can read about tips to save money on your car.  Now lets look at leasing vs buying a car pros and cons.

Upside Down With Car Payment

Being ‘upside down’ is the term used to describe when you owe more on something than it’s actually worth. When you’re talking about cars, it can happen surprising easily.

As a rule, new cars immediately lose value as soon as they’re driven off the lot. It takes several months or even a year of payments to owe less than the resale value of the car. For that period of time, you’re upside down. The longer your loan term, the longer it takes to get to the break-even point.

So it seems that what more and more new car buyers are doing is not entirely paying for a car before they turn around and sell it. Then they buy another car and roll the old loan balance into the new loan. After a few cycles of this, you’re driving a Chevy with a Mercedes-size loan.

The Numbers

To put numbers to the point, let’s say you want to buy this nice new Toyota Camry with a loan of $25,000. If you finance for five years at 5.09% (what my bank offers), you’ll be paying $3,369 in interest over the life of the loan. If your loan term is three years, total interest is $2,789. Financing for the longer term nearly doubles the interest you pay.

If you decide to trade in that car after four years, you still owe over $5,520 on the loan. No problem – just roll that into the loan for your new car.

Do this a couple of times and you’ll quickly be driving a car worth half what you owe on it.

Lease Instead

Since evidently a great many people are doing just that, it seems they should be leasing instead of buying. At least at the end of a lease you don’t owe any money (assuming you fulfill the terms of the lease). Not only that but you’ll be able to afford more car than you would by buying outright.

Like I said, people do unbelievable things when it comes to money.

Saving Money For Travel

Saving Money For Travel Tips

Many families take a vacation as a reward for working hard and making it through the preceding months. Vacations create unique memories that everyone will share for years to come. Coming up with the money for a trip is not always easy. There are five budgeting tips that any family can use when saving money for travel.

1. Create A Savings Account

Creating a separate savings account for vacation money will help in a number of ways. It allows families to see the actual amount of money saved without having to deduct current expenses. A separate account also makes it harder to access the savings. This reduces the chances that it will be used for an impulse purchase. A dedicated savings account is useful because it is safe and separate from the main accounts used every day. Fees or other charges on a checking account will not affect the vacation savings.

2. Temporarily Eliminate Extras

A vacation is a time to relax and to have fun. One way to save money for a trip is to reduce the extra services in a home temporarily. Sacrificing a little entertainment or fun while saving will make the vacation much more enjoyable. Some extra services that could be cancelled include premium cable channels, housekeeping and expensive cell phone perks that do not affect service. These services can be reactivated after the vacation. The money from the cancelled services can be put directly into the savings account each week or month.

3. Lower Credit Card Payments

One way to help save money is to try to lower credit card payments before the vacation. Lowering interest rates will reduce monthly spending on bills. Credit card companies will sometimes lower rates for good customers who call and negotiate. This is not always possible for people with credit problems. A reputable credit repair service can often fix credit history problems quickly. This can make it possible to negotiate with a credit card company for lower rates.

4. Reduce Vacation Costs

An alternate way to help save money for a vacation is to lower the cost of the trip. This will make each dollar saved more valuable. Reducing the cost of a vacation can take some work. It is helpful to check regularly if there are new deals or discounts available. Finding less expensive hotel rooms or airfare will make it easier to save and will give the family more spending money once the vacation starts.

5. Create And Follow A Budget

The most effective way to save money for a vacation is to create a budget and then follow it as closely as possible. The budget should account for food, gas and other spending. Unnecessary expenses like eating out should be removed from the budget. All members of the family should resist spending money that is not listed in the budget. A good budget will predict exactly how much can be saved each week. It also shows expenses that could be reduced.

Hulu Or Netflix

Hulu Or Netflix: Which One Is More Worth Your Dollars?

Most consumers used to just sign up for cable without thinking about the alternatives, but the era of cable bundles may be coming to an end soon. Many people are finding that they would rather watch television online using their mobile devices as well as their gaming consoles and computers for a flat-rate that is much lower than cable.  Read more on ways to save money this summer.

So Hulu or Netflix?  Well, netflix currently has about ten times as many subscribers as Hulu, but their service has also been around much longer. Netflix has pledged to spend five billion dollars on acquiring new content throughout the next five years. They will be focusing on acquiring all of the most popular movies and television shows.

Hulu is owned by ABC, NBC and FOX. They currently offer customers the current season of shows from these networks for streaming. In addition to their large selection of television offerings, Hulu is currently experimenting with the addition of movie titles.

Hulu & Netflix – Accessibility and Content

Hulu or Netflix can both be streamed on many different devices, including smartphones, tablets, gaming consoles and Blu-Ray players. They both allow customers to stream content over mobile broadband 4G and 3G networks.

Netflix is currently stocked with about 100,000 streaming options and their movie collection is constantly growing. They offer a variety of television shows, however most of the shows they offer have been cancelled. Their options for current television series usually don’t include the current season.

Hulu offers many current television shows and most current episodes are available the day after they air on television. Most people who watch Glee and other current television shows opt to subscribe to Hulu. The have shows from many networks, including ABC, BBC America, FOX, The CW and USA. The movie selection at Hulu is sparse, but their selection of television shows is excellent.

Hulu and Netflix Users Watching Habits

Hulu and Netflix Users Watching Habits

Pricing for Hulu and Netflix

Netflix streaming costs just $7.99 per month for unlimited streaming of any of the content on their site on any supported device.

Hulu offers customers many shows for free at, but these shows are interrupted by substantial advertisements. Customers can choose to subscribe to Hulu Plus, which costs $7.99 per month and allows customers the ability to download mobile apps and access Hulu content through gaming consoles. The amount of ads is substantially reduced for Hulu Plus customers, but a few ads still appear during streaming.

The Bottom Line On Hulu or Netflix

Many people who get rid of cable spend $15.98 per month to subscribe to both Netflix and Hulu. This gives you the best of both worlds, with a variety of movies and television shows available for streaming at any time. Netflix is generally the best option for customers who want to keep their cable bundle while giving themselves the option of instant streaming and more movie choices.

Budget Planner Template

Using A Budget Planner Template

I recently received an email from John about using a budget planner template.  He wrote:

“Hello, I’m feeling a little lost and have some questions in regards to budgeting and saving.  1. Which budget planner template should I use?  2. From the total salary what percentage is ideal to spend for various needs, and how much to be saved for future?  Any insight would be greatly appreciated.”

It’s a question that we all must answer. Even if some of us would prefer to ignore it! Because, with rare exceptions, we all have to deal with having just so much money to cover all our expenses. And, if we spend more than we take in for very long we get into trouble.

Let’s look at a “typical” budget planner template. Then we’ll discuss it.

Category % of Income
Housing 35%
Food 15%
Auto 15%
Insurance 5%
Entertainment 5%
Clothing 5%
Medical 5%
Everything Else 5%
Savings 10%

Understanding The Budget Planner Template

The first thing you’ll notice is that I didn’t include any taxes (either income or Social Security). You can choose to do that if you like (in fact, it’s a real eye opener). But for our purposes it’s easier just to deal with your ‘take home’ pay.  The second thing to notice is that this is a guideline, not a straight jacket. The truth is that very few of us will fit into this exact framework.  So if your spending doesn’t match, don’t despair! Analyze the situation before you panic!  Try our excel budget template!

Customize the Budget Planner Template To Fit Your Wants & Needs

For instance maybe your entertainment spending is closer to 10%. Is that a problem? Maybe not, if you’re young, single and sharing an apartment with three friends. In that case what you save on housing is going for entertainment. So overall you’re not spending more than you’re making.  Or you may be a city-dweller where housing is very expensive (think NYC). But because of public transportation you don’t own a car. So the extra you spend on housing is offset by the reduced spending on transportation.  You get the idea. Tailor your spending plan to your needs. And, adjust it as you go through life and your needs change.  One other thing to notice is that housing, food and auto make up the lion’s share of the expenses. That’s true for almost everyone.  It’s in those three areas that most families get into trouble. Most often by buying a home or vehicle that they cannot afford. But once the commitment is made it’s very hard to undo.

Categorizing Your Expenses

You might wonder where a certain expense goes. For instance, household cleaning supplies. Many people buy them at the grocery store. So are they a housing or food expense? The answer is: it doesn’t much matter. Put them wherever it seems best to you. The key is always putting them in the same place, so you can compare results from month to month.

Another common question is what should I do with charitable contributions. You can either take it off the top (like taxes) or create a separate category for it. If you believe that contributions should come before your expenses you’ll want to take it off the top. If you think that it’s part of your regular spending then include it as another expense category.  For a budget planner template to be effective you must continuously follow your progress.

How Much Should You Save?

Finally, let’s look at John’s question about saving. There probably isn’t any single right answer, because saving isn’t really an expense. It’s an investment for a better future.  So I prefer to think of savings in terms of priorities. Before I can put money aside for savings I need food and a reasonable shelter. Probably also need dependable transportation to get to my job.  But after those basic needs are met, it’s time to begin saving some money. Not necessarily the 10% in our guidelines, but 2, 3 or 4%. Enough so that there’s some money set aside for the so-called unexpected expenses that happen to us all (dead appliances, home and auto repairs, unexpected sickness, temporary lack of work).

One other comment about savings. Paying off debt (especially credit card debt) is a little like savings. Consider payments used to reduce the amount owed as if they were savings or a Bank CD.  Finally, for those of you who don’t want to bother with any of this. I know what you’re thinking: I’m fine and don’t need any help monitoring my money. Just remember that most people who are in trouble today said the same thing when everything looked good to them.