This is a post by Kevin Yu, author of the DebtEye Blog.

It’s a great and liberating feeling after you made your final payment to your credit card company.  Your hard work, persistence, and dedication finally paid off.  Go ahead and celebrate and rejoice, but don’t get too comfortable.  Getting rid of debt is only half the battle.  The other half is knowing how to stay debt-free so you don’t follow the same road as before.

“Nearly all debtors stated that they had received offers for credit [cards] in the first months following their bankruptcy,”—Source.

Why is this quote so important?  The reason is because credit card companies love targeting consumers who are fresh out of debt.   They know that with this new “fresh start,” consumers will likely begin to rack up credit card debt again. 

Credit card companies don’t like you if you pay off your balance in full each month; they like you because you’re considered a “revolver”.  A revolver is someone who only pays the minimum payment and carries their balance over each month.

How do you stay debt free?

The first part of living a debt-free life is knowing how you got there in the first place.  Let’s face it, accumulating debt doesn’t happen overnight.  There was some reason why you started to accumulate debt in the first place.  Here are the most typical reasons most people get into debt.

1. Not enough savings: There comes a point in everyone’s lives where we’re faced with unexpected expenses.  It can include medical expenses, car/home repairs, or even a friend or family who needs to borrow money.  You should have at least six months of living expenses saved in case of emergencies.  If you had an emergency fund, you wouldn’t need to charge it on your credit card, right?
2. Keeping up with the Joneses: Having the best things in life is great.  We’re living in an age where technology and innovation creates new “must-have” products.  Your neighbor buys a new 3D TV, and you now feel the need to buy a bigger and better one.  A friend buys the iPad2 while you’re still stuck with the original iPad.  This is a habit you want to avoid at all costs.  Do you ever hear about celebrities who file for bankruptcy?  I wonder why.
3. Poor money management: How many of us actually have a budget and stick with it?  You must create a monthly budget and get in the habit of following it.  However, I always recommend that everyone starts off with a monthly spending journal.  A spending journal involves writing down every little expense (even the $0.25 pack of gum you buy).  After a month, you’ll start to notice a trend and see where your money is going every month.  From there on, you can now construct a realistic monthly budget and find where you can trim some of your expenses.  Also, don’t forget to set aside 15% of your income towards savings!

Learn to use credit responsibly: become a “deadbeat”

A “deadbeat” is a term used in the credit industry to describe a consumer who pays off their balance in full each month.  Creditors refer to you as a “deadbeat” because they don’t profit off of you compared to a “revolver”. 

I’m not here to tell you to stop using credit cards forever. Using your credit card is important in establishing credit in case you’re making a big financial purchase.  Without it, you have no creditworthiness. 

But here are some tips on how to use credit responsibly.

1. Have a small credit limit: There’s really no need to have a $2,000+ credit limit on your credit card.  Having a higher credit limit only makes you feel that you have “free money” that you can pay off at any time.  This is why credit card companies send letter saying that you’re eligible for a higher credit limit.
2. Pay off your balance: This may sound like an obvious tip, but it’s surprising how many people carry balances.  For example, if you have a $500 balance, you can tell yourself that you’ll pay off $400 and leave a $100 balance.  Soon enough, this is going to develop into a habit.  This is exactly what your credit card companies want.  Have the discipline to pay off credit cards quickly before the due date!
3. Gain reward points: If you decide to use your credit card for daily purchases (and of course pay it off every month), make sure you reconcile your transaction at least once a week. Make sure you’re keeping track of how much you’re spending every month in each expense category.  This will ensure that you’re not “freely” using your credit card for unnecessary purchases.

Living a debt-free life involves learning to spend money wisely. If you can keep to a budget, set aside money towards your savings account every month, and pay off your credit card balances in full, then you’re well on your way to becoming a deadbeat!

Kevin is the author of the DebtEye blog. He is a certified credit counselor and used to own a credit counseling company in Chicago. He is also the co-founder of DebtEye, which is an online software to help people get out of debt.

This guest post is by David Lazar of PdfConverter.com.

You can play the idealist and say that Christmas is about spending time with family and friends, not about presents, but realistically, presents have become something that you cannot have Christmas without these days.

Before you start stressing over all the money you will spend and all of the credit card bills that will be staring you in the face come January, take a deep breath and compose yourself. There are things that you can do to prepare yourself for the holiday spending season.

If you are watching your spending and counting your pennies all year round, December should be no different.

Here are some steps that you can take to make sure that you will be able to indulge in your holiday spending spree without losing sleep over it. With some careful planning and smart shopping, you can get all of your Christmas shopping done without digging yourself deep into a financial hole to start off the New Year.

Take all spending into consideration

Remember, presents are not the only expenses that you will incur during the holiday season. There are many things that you need to take into consideration along with the gifts and plan accordingly.

Many people set aside a certain amount of money for the holidays and then proceed to spend it all on presents, when in reality, they need to be looking at the many other expenses that they will undoubtedly be faced with in December. Perhaps you will be traveling to a relative’s house for the holidays.

Don’t forget about the money you will have to spend on a tree and decorations, parties, food, wrapping paper and greeting cards—all of these things cost money and you must be aware of these factors when planning a holiday budget.

Plan a gift budget and stick to it

Now that you have taken all of the costs into consideration, you are ready to see how much money you are left to work with and how much you will be able to spend without emptying your bank account. Make a list of all of the people that you plan on buying gifts for and prioritize the list.

Do you really need to buy something for all of your colleagues at work? Probably not. If you have coworkers who you consider to be good friends, buy them something and get some candy or simple cards for the rest of your coworkers. Or you can just make some cupcakes for everyone in the office instead of trying to get gifts for everyone.

Your children and close family members and friends are your priority—see how much you need for them and then look at what you have left to cover other people you are thinking of giving presents to this year.

Setting a budget plan and sticking to it might take more work than you are used to having in these situations, but you will thank yourself for doing it when your bank statement arrives in January.

Create a gift list

People who don’t make a list and budget plan end up going shopping and spending way too much, because they buy impulsively and spend a lot more than they can afford. When you go food shopping you always have a list with you, right? You even have a bag of coupons which you have clipped in preparation. There is no reason that Christmas shopping should be done any differently.

As with any kind of financial practice, planning your spending is essential: the better prepared you are, the less you will spend. Be sure to make a list and check it twice before going out and spending blindly on gifts that you are not even sure you need to buy.

Start shopping early

The sooner you start, the better. Perhaps it’s too late now, but take this into consideration for next year. If, while you’re shopping for your kids’ school clothes in September, you see something that you think they would like for Christmas, and it’s on sale, snap it up and put it away for the holidays.

The more time you have to shop, the more options you have. If you start looking for gifts early, you will be able to visit more stores and compare prices better. You don’t have to wait for the Christmas sales to shop: there are sales happening all year round.

Mind the sales

Here’s a good tip regarding sales for you to consider. Do you really think that the store employees arrive at the store at the break of dawn on the day the sale begins to adjust all of the prices? Usually not.

Try visiting some of the stores on the night before the big sale officially starts. There’s a good chance that the prices will already be marked down in preparation for the sale. This allows you to get the items at their sale price while also avoiding the large crowds that will undoubtedly file into the store in the morning.

If you are not familiar with shopping on the Internet, get familiar, because this is the new frontier of shopping and saving. Just as there are sales and coupons for regular stores, there are tons out there for web-based stores as well.

An easy way to find savings is to Google the name of the store that you are interested in, along with keywords like “discount code,” “coupon,” or “promotional code.” There’s a good chance that you will find some additional ways to save online that way, especially during the holiday shopping season.

Go easy on the plastic

If you have planned accordingly and have followed all of these other steps, then hopefully you won’t have to use your credit cards when buying presents. However, the reality of the situation is that you probably will have to use your credit cards for some holiday expenses.

If you are going to use a credit card, use it as minimally as possible. If you’ll be able to pay off the money that you spent over the holidays by March or early April, then you are going to be alright, but if it’s going to take you an entire year to pay up, you’re going to be in trouble. And of course, if you are going to use a credit card, makes sure you are using the one that offers the lowest interest rate.

Stick to these guidelines as closely as you can to be on your way to a Christmas full of presents but void of financial stress and worries in the New Year. What others can you add to this list?

David Lazar is a blogger at PdfConverter.com. With a background in journalism, he enjoys writing about and following a variety of topics, including finances, careers, technology and new media.

This post is by Dani Butlerson of Payday Express.

Ah, the elusive payday, when spending and expenses have taken their toll and month end just can’t come quick enough!

It’s Murphy’s law that you seem to have a run of bad luck with expenses that you hadn’t banked on at the end of a month in which you soon realize you might have spent a bit too much. Maybe a few too many nights out, the forgotten credit payment, or a holiday that seemed mandatory at the time left you with not quite enough money to cover that broken boiler as winter sets in.

The end of the month can often be the most stressful as it always seems that unforeseen bills or emergency expenses rear their ugly heads then, and you have to start relying on the clearance section of the supermarket!

Okay, it mightn’t often get so bad that you’ll start eating bits of paving slab for sustenance, but it’s never a pleasant experience to realize that you’re not on top of your finances and still have a bit of a wait until payday.

So what can you do to calm your end-of-month worries? Well, while this advice might not work for everyone, here are the top five tips with which I’ve managed to pinch a few pennies to tide me over til payday.

1. Switch to public transport, take a walk or cycle to work

Heck, why not? It’s environmentally-friendly, a darn sight cheaper and should be more relaxing than tackling rush hour traffic.

2. Cook your own meals

If you’re anything like me, you’re a restaurant fiend. I don’t even know how it happened—I even had a brief stint as a chef! And still, when I get in from work, I can’t resist meeting up with a friend in a fancy restaurant or ordering some Chinese takeaway. Thing is, if you actually weigh up how much you spend on this (generally unhealthy) food, it’s amazing the savings you’ll make by cooking your own meals.

3. Sell some of your stuff

I admit it: I’m a hoarder. I have stacks of DVDs, useless junk, and old sporting equipment that is just gathering dust. I recently opened an eBay shop and started pawning my wares, and the extra windfall definitely helps.

I recommend services such as Envirofone or Mazuma for your old mobiles; play.com for CDs, DVDs and games; and, if you’re a particularly creative sort, etsy.com fro craft items.

4. Take out a payday loan

Easy to apply for online, a payday loan can provide the extra bit of help when you need some temporary short-term credit to see you through to payday. Just ensure you only borrow what you know you can comfortably pay back with interest on your payday, and keep everything organized. Speaking of which…

5. Plan those weeks ahead

Now, this is one I’ve struggled with somewhat, despite it being the most important! I hate to plan ahead and would much rather do things spontaneously, but with finances, this is just too big a risk to take.

Since I created a list of expenditures and allowed for a monthly budget, I’ve not only reduced my stress levels, but also ensured that I generally have something left over at the end of a month in case one of life’s little emergency expenses suddenly crops up.

Now, it’s my payday at the end of next week and I’m actually doing alright! Okay, I’m not going to be rushing out and buying a 42” widescreen TV (although if anyone would like to donate one to me, please feel free to get in touch!), but I think I’ve started to understand fiscal responsibility that little bit more.

Just remember, money is rarely a constant and you can’t predict the future—stay sensible, plan ahead, and look after your finances, because you never know when you’re really going to need them.

Dani Butlerson is a writer for the web team at Payday Express, short term payday loans providers, offering a quick, easy, and friendly service for customers.

This post is by Jesse Langley.

If you’re starting to pinch pennies and worry about cash flow, you’re not alone. Tough economic times and uncertainty about the future have a lot of people cutting back drastically. But you don’t have to cut back on all your purchases and fun activities just because you’re getting strict about your budget. You just need to get creative about how and where you’re spending.

Get smart: use coupons

Going to the grocery with just a grocery list won’t cut it anymore. Searching for sale items is a great start, but coupons can help you reduce your grocery bill significantly. And since printable coupons are so readily available, you can spend a little time finding coupons for the items on your list before you even leave the house.

Saving money on necessary budget items like groceries means you can transfer those savings into other budget categories. If you’ve completely cut out date nights or movies and an occasional pizza, the money you save on grocery bills can give you some extra cash for an occasional splurge.

Find fun alternatives

When people start tightening their belts and trimming budgets, the first thing to go is usually entertainment and non-essential spending. This can actually be a mistake. The last thing you want to do when times are tough is make your life less fun. You can still engage in the same fun entertainment activities. You just need to do it differently.

Taking the family out for pizza and movies can kill a budget. By the time you’ve paid for two pizzas, four movie tickets and the requisite sodas and popcorn, it’s likely going to be just shy of a hundred dollars.

Instead, have a family pizza and movie night at home. Make it a family affair with some pizza kits and have the whole family pitch in. You can enjoy some delicious homemade pizza for a fraction of the cost. And after dinner, the whole family can lounge in the living room and watch movies with a Netflix subscription. It only costs $8 per month for unlimited movies. What makes this a nice option for family entertainment is the huge selection of kid-friendly films.

So for a family night, you can have more fun and family involvement for about one tenth of what you’d spend going out.

Buy used

You shouldn’t get hung up on having to buy new items. Finding used items for a fraction of the cost is a great way to cut down on monthly expenditures, and it’s fun too. craigslist is a great resource for practically any item you’re looking for—from home furnishing to a second vehicle.

You shouldn’t have hang-ups about buying used. Local thrift shops are often a lot more like little boutiques than the Salvation Army you may remember as a kid. Buying gently used clothing allows you to make frequent targeted purchases and it’s easy to find exactly what you’re looking for. Finding name brand clothing in a local thrift store is a great way to cut back on clothing purchases—and there’s no thrill quite like finding the perfect cashmere sweater for just a few dollars.

Cutting back on spending is a good idea, but there’s no reason you can’t make it fun. What budget-stretching tips can you share with us?

Jesse Langley lives near Chicago. He divides his time among work, writing, and family life. He has a keen interest in blogging and social media and is an advocate for online training.

This post is by Shaun of moneycactus.com.

I know what you’re thinking: “just another post about financial goal setting.” Yeah, those are pretty common these days. How much more could I tell you about setting SMART goals, and having them for the short, medium, and long term anyway?

Click! You’re gone … plenty more to read online today.

It’s a bit of a shame for those that have already left, because I’m not really interested in how you set goals, or the number you have and whether you’ll achieve them before midnight on New Year’s Eve. What I want to know is:

1. why you set them and
2. how big they really are.

Forget Specific, Measurable, Attainable, Relevant and Time bound goals.

Let’s talk about your dreams instead.

How big do you dream?

Alright, time to be honest here: do you dream about being filthy rich and powerful? How about just well off with the nicer things in life? Perhaps you would just be happy to be debt-free and have more choices and freedom?

There is nothing wrong with dreaming about any of these things. It really depends on how big you want to get and where your priorities lie.

What do you value?

Everyone has a core set of values. These are the things that you place the greatest importance on, and are generally what drive you to do the things you do, live the way you live, and be the way you are. It is really important to understand your values when setting goals—particularly financial ones, as they will ultimately dictate the end result.

If we focus on financial goals, then the associated values are the way we think about our time, money, and lifestyle. If you want to be filthy rich, then you probably value money the most. If you want to be well off, then it is likely you value lifestyle, and if you just want to be debt-free to enable greater choice, then you probably place the greatest emphasis on your time.

People often say they value all of these things, which is perfectly fair, but if you really think on it, it is likely that you place greater value on some aspects more than others.

If you are honest with yourself and identify your values, then developing and reaching your financial goals will get a whole lot easier.

To determine your values, have a think about some of the goals you may have set in the past, or some you might set right now. Are they focused around a central theme? If you were to prioritize them, how would the most important one align with money, time, or lifestyle?

Personally I find the best and most telling way is to look at goals that you haven’t achieved in the past. The reason is likely because they didn’t align with your values.

How strong is your belief?

Once you understand your values, you should know how realistic your goals might be. This doesn’t mean you can’t or shouldn’t try to stretch yourself, but it will help you identify your weaknesses and hopefully improve your resolve if you are truly committed to reaching your goal.

For example: If you value the simple things in life, then a goal to live frugally and save as much as you can might be completely achievable. On the other hand, if you value your creature comforts then this might be a huge stretch.

I think that the ultimate example is the one of becoming filthy rich. After a certain point, having lots of money would cover all of our values wouldn’t it?

• Rich and powerful? Check.
• Lifestyle and creature comforts? Check.
• All the time in the world and lots of choices? Check!

Perfect, right? Well, not really. Unless you win the lottery, you still need to commit to a path that allows you to reach this goal and it will not align with the values of everyone. In fact, it is likely to align with the values of very few because often it means taking big risks with the money you have, committing to a plan without wavering (i.e. having very little choice), and living on less in order to invest more.

The goal of becoming filthy rich therefore seems to be unattainable because no one has values that align with the goal. I’m not going to lie to you—this is a pretty tough goal and not one that many truly want anyway, because they’d have to stretch all of their values at the same time in order to achieve the desired outcome. If this is a goal of yours, then understanding your values and how they will impact your financial goal setting will greatly improve your chance of success. If it is not your goal, you should still think about ways in which you can try to stretch your values and dream as big as you dare.

If you place strong importance on your immediate family/children/closest friends, you might set a goal to double your income in the next 12 months in order to allow your partner to give up their job and stay home with the kids or enrol the kids in a private school/drama classes/music lessons or fly ten of your closest friends to Bali for a party.

Ultimately, your goals need to be about you. Why else would you set them? Find out what you value and your goal setting will get a whole lot easier.

So, what do you value? Share your thoughts with us in the comments.

Shaun is not an accountant, financial planner or life coach, but he writes about wealth creation anyway! Shaun’s motto is “Make wealth, not money,” which fits quite nicely with where he wants to be in life. You can find out more by visiting his blog where he shows you how to do nothing and grow wealthy.

This post is by Ali Luke of Constructively Productive.

As I write this, it’s late August here in the UK—and the weather is already cold and miserable. By the middle of winter, I know that I’ll be thoroughly fed up of the rain and the grey skies.

If you live in the Northern Hemisphere too, you’ll be watching the days grow shorter and shorter as winter approaches. By December or January, you’ll probably be wishing you were somewhere warmer.

Now’s the time to plan (and save) for a winter getaway, so that you’ve got something to look forwards to as the months get colder.

Why it’s good to get away

You know how valuable a vacation can be. It leaves you refreshed and re-energized for your work; it gives you a chance to spend time relaxing with your family or friends; it may even be a chance to try out something completely new.

In the depths of winter, getting away to somewhere warm and sunny can really lift your spirits. Christmas is often a busy time of travelling to see different groups of friends or relatives, so taking a break in early December or in January can give you some much-needed time out!

Of course, you probably agree with me that a winter break would be great—if you could afford it. After all, with Christmas on its way, your budget might already be looking stretched.

Don’t simply wait until December to see whether or not you have enough money left over for a break: chances are, you won’t.

You need to start saving now so that you can enjoy a guilt-free trip.

How to keep your savings plan on track

You don’t have to save a lot in order to get away. A few hundred dollars might well be enough for a long weekend trip, plus cheap flights (try hunting around online for good deals).

If you saved just $50 per week—$10 each weekday—for three months (13 weeks), you’d have $650. Okay, it’s not going to buy you a month-long cruise, but it’s enough for a refreshing few days away.

Where can you find that $50? Perhaps:

• you and your partner go out for a meal twice a week, and easily spend $25 per head
• you’re buying a couple of new DVDs or computer games each week
• your daily lunch costs you $10—if you packed leftovers from home, or made a sandwich, you’d be paying a fraction of that
• you spend $50 on drinks every Friday night when you go out with friends.

If you haven’t got much idea of what you’re currently spending, try keeping a log for a week. Write down every penny you spend. At the end of the week, look for $50 worth of spending that you could cut.

It can be hard to stay motivated to save, so if you’re struggling, try these tips:

• Only take the cash that you need when you go shopping—that way, you won’t be swayed by impulse purchases.
• Book your trip ahead of time. Then you’ll know exactly what you’re saving towards.
• Put your savings into a separate bank account, so that it’s harder to spend them on a whim.
• Ask your partner or a friend to keep you accountable.

If you hope to enjoy a winter vacation in three or four month’s time, let us know what you’re planning to do, and how you’re going to make sure it happens! The comments are open…

Ali Luke blogs at Constructively Productive about productivity with perspective. If you’d like regular tips on getting more done, saving money, and—most importantly—finding time to do what you love, then grab the RSS feed here.

This post is by Shaun of moneycactus.com.

Isn’t it funny the way different people behave with money? Some squirrel it away and spend as little as possible, while others spend like drunken sailors, buying anything and everything they can!

Although there is a huge difference between these personality types I don’t personally feel that one is necessarily any better than another. Both examples tend to highlight people who use money poorly and are therefore not contributing to their own wealth. I don’t recommend indiscriminate spending and neglecting savings, but then I don’t really endorse extreme frugality either.

Although their personalities may be poles apart, people at both ends of the scale tend to end up feeling the same way: poor and unhappy.

The indiscriminate spender

Indiscriminate spenders may briefly satisfy their need for instant gratification by buying the things they want, but all this really does is fuel the fire and leave them feeling empty and wanting more. These are dangerous feelings and the result is similar to any other addiction: the bar needs to be raised each time in order to achieve the same feeling of satisfaction.

The outcome is often a debt spiral that becomes harder and harder to pull out of and our unhappy spender comes to the misguided conclusion that money is the root of all evil.

The money hoarder

Although money hoarders may feel like they are far better off than indiscriminate spenders, they don’t generally fare much better. Most will also feel unsatisfied with their financial position as the thing that makes them successful money savers also stops them from enjoying the fruits of their labor—they become afraid of spending. Amassing large sums of money is something to be proud of, but merely hoarding it is like keeping your favorite toy in its packaging and never getting to play with it.

There is no fun to be had and eventually you end up resenting money in the same way as our unhappy spender.

The wealth creator

The best wealth creators are not generally extreme at all, they are in fact completely average in every way. They know how to save, but also know how to reward themselves for doing so. There are no feelings of guilt relating to the way they use their money, a successful wealth creator can spend their allocated money freely as this is exactly what it was intended for. Wealth creators understand that there is more to life than money, but also know how to attract and use it to make more.

The biggest factor defining these type of people is their ability to think logically and control their emotional intelligence.

How do you view money?

It is completely possible to be a wealth creator, no matter what you current outlook is, all it takes is a change in perspective. Most of us aren’t extreme spenders or hoarders, but then most of us also have trouble finding the balance in between. Money can have strong effects on our emotions and quite literally rule our lives if we let it, this is where controlling our emotional intelligence becomes very important. Strangely enough, the process we can use to develop our emotional intelligence is exactly the same for both indiscriminate spenders and money hoarders alike, ultimately It comes down to how you view your money and how you value your other aspects of wealth.

If I said to an indiscriminate spender, “Hey, you should buy this really cool shirt. It’s on special and looks great on you, plus it only costs fifty bucks!” chances are they would be rather tempted. After all, it will make them look good and it’s on special.

Now what if I said it in a slightly different way? “Hey, you should buy this really cool shirt. It’s on special and looks great on you, plus it only cost three hours of work!”

Chances are our indiscriminate spender is going to ask me what the heck I’m talking about, but then they might also think a little longer about buying that shirt. Would they go to work for three hours and happily walk out with that one shirt? If the answer is yes, then they should go ahead and buy it. At least now they have made a conscious decision.

Our money hoarder is probably not that into retail therapy, they might desire something else, but the loss of their precious savings is holding them back. The same principal can be used to weigh up the true cost of what they want.

“Round-the-world ticket for $1,899.”

Or

“Round-the-world ticket for less than three weeks’ work.”

I don’t care how tight you are with money, that is starting to sound pretty darn good! Money hoarders need to find the thing they desire, allocate funds and start working towards it. By setting a reward they may just find that they work harder, or preferably smarter, at achieving their goal and developing their overall wealth by adding to their life experience.

It really doesn’t matter what your pay or tax rate is, you can easily apply this train of thought to your situation and ask yourself the same question: would you be happy to give up X amount of time (working) to get Y as a reward?

In the end wealth creation is much more about lifestyle than it is about just making money. If you know what it is you want to do, and develop your emotional intelligence to help make better financial and life decisions, you will find you can do just about anything you like.

Shaun is not an accountant, financial planner or life coach, but he writes about wealth creation anyway! Shaun’s motto is “Make wealth, not money,” which fits quite nicely with where he wants to be in life. You can find out more by visiting his blog where he shows you how to do nothing and grow wealthy.