Credit Cards & Credit Scores, OH MY!

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How many times have you walked into a big box store like Walmart and have been told by the salespeople about the instant perks you get by applying for their credit cards? Back when I was in University, I was applying to all-sorts of credit cards not really realizing the negative impacts it would have. I wanted the perks! But, how many credit cards do you need?

Honestly, there is no perfect answer!

I know for a fact that you can get an excellent FICO score if you just use one single credit card – the key, however is how you actually use the credit. In-order to even have any credit history you need to have used some type of credit – so it’s not necessary to have actual credit cards. You may have a loan for example that would show lenders your ‘activity’. It’s this activity lenders look at to determine your ’score’. One thing you must remember, however is that whenever you decide to apply for new credit, your credit score can take a little ‘hit’ so be careful with how many you actually apply for in any given time-frame.

How do I get one of these credit cards Walmart?

If you’ve been responsible with a checking/savings account, chances may be good – talk to a bank representative about opening up a credit card. An existing relationship can definitely help.

At the end of the day your activity will determine your credit score – pay your bills on-time and keep your debts low – it’ll go a long way!

5 Ways to Save Money

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Where has all the money gone?

money

Given the less-than-admirable current financial state, it’s especially important to look at ways to save your hard-earned money. Here’s 5 quick and easy ways to help you save more money right away:

  1. Buy Grocery in Bulk

Reports outline savings of as much as 10%-15% when purchasing groceries in bulk. Online grocers such as Grocery Gateway are becoming increasingly popular and often offer significant savings for purchasing in bulk. Besides, who doesn’t want five packs of deliciously nutritious Pop Tarts in their cupboard?

  1. Put 30% of Your Paycheck in a Savings Account

It’s really easy to indulge on payday – regulate that urge by putting away 30% of your paycheck in a high-interest savings account. You’ll thank yourself later when that money accumulates toward the purchase of that brand new 5- speed manual BMW. Or that brand new 5-speed mountain bike. Whatever floats your boat.

  1. Reduce Phone Extras

“This message is directed to a voicemail service that has not yet been set up by this customer. Thank you, goodbye.” Seriously, if you’re not going to use your voicemail service, cancel it! You wouldn’t pay extra for a delicious piece of chocolate cake after dinner and NOT eat it, right? (I sure wouldn’t) The same applies to phone extras outside of voicemail – call forwarding, caller ID, long distance calling, etc.

  1. Take Advantage of Bank Programs

The Canadian bank marketplace offers a multitude of money-saving options. Scotiabank’s Bank the Rest program can save you over $500 dollars a year just from purchasing lunch 3 times a month or more.

  1. Track Your Spending

It may come as a surprise, but knowing exactly where your money is being spent most will definitely help you look to what expenses you can cut out or reduce monthly to save money. Sites like spending profile offer a free, useful online portfolio designed to help track your monthly expenses.

Take advantage of these 5 important ways to save money and I assure you’ll see results instantly. It worked for me – I’m now the proud owner of a brand new, shiny 5-speed mountain bike.

Reasons Why We Fail to Save Part 2

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As I mentioned a while back, there are various reasons as to why a person may not be able to save enough money. I focused on the fact of not having enough money to get the task accomplished, however that reason tends to be an excuse for those who do not take the time to find the extra money we tend to have within our budget.

We all have a buffer region in our budget, which compensates any over spending in a certain category. Stop over spending, stay within the actually budget and you can use the money you set aside as your buffer to put towards your savings.

A huge reason we see ourselves fail to save enough money is not starting early in life. Every day that passes without you saving money is a lost opportunity, and it is something you cannot get back. If you start saving early, you increase the number of years you can contribute to your savings, not to mention the benefit you earn from interest.

If you are among those who have yet to start saving, here are a few tips to get you going.

Set up an automatic withdrawal from your account to a savings account. This will allow you to save money without having to set the money aside manually. You add the amount into you budget, so you can account for where the money is going.

Many banks have savings programs, where when you spend with your debit card, an amount of money will go into your savings account at the end of the day. This can help you save on a daily basis, which could possibly make up for some lost time.

No matter what the case is, there is no reason you should not be saving right now. Save early on in life, and in no time you will be enjoying the benefits.

Avoiding Debt in College

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With us in the 3rd week of the month, university students should be adjusting to their new classes, especially first year students.

What I found difficult in my first year was managing my expenses efficiently as to not overspend, and end up going into debt. Generally, first year students face the expense of living on their own for the first time, and maybe a part time job, which does not give much room to save any money.

The best advice I can give for first year students is to live within your means.

You have to start limiting your spending from the beginning in order to avoid piling on the debt.

In order to limit your spending, you have to create a budget in order to efficiently manage your expenses. In your budget you have to be sure to include food expenses, entertainment costs, etc.

The biggest problem you may have with your budget is that you do not take the time to track what you have been spending, and cutting back where you can. With that said, seeing as it is a new environment for yourself, create a test period. For 3 months, use the budget you have created, and test it. If you do find you have plenty of room to improve on it, make adjustments. By then you will be nearing your fall exams and probably will not have any time to go out, making it a great opportunity to adjust your budget.

Remember, in your post secondary life you are meant to build a foundation for your future, not a foundation of unnecessary debt.

Home Buyer Tips

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With new mortgage rules coming into effect and mortgage rates due for an increase as the Bank of Canada’s rate increases; Canadians will soon find themselves in a bind when purchasing a home.

real-estate

To help ease the stress of purchasing a home, I have a few tips you may want to consider following.

1. Lock in Mortgage Rate

When you apply for a mortgage, you will be able to lock in the rate. This is generally for a maximum of 120 days. This guarantee will let you have the rate you want despite any increases made during the time period.

2. Consider Future Possibilities

With rate increases bound to happen soon, and you are worried about affordability, take into account a 1 – 3% increase in your payments. By doing this you can have peace of mind knowing the whether or not you can afford a home now or in a few years.

3. Leave Room

With a pre-approved mortgage, you will know what you can afford, however do not make any rash decisions. Take into account your current lifestyle, and consider any future changes. You should purchase a house within a comfort zone, which will help if any unexpected costs come up.