If you lost your job today, would you be okay financially? If you’re like millions of other Americans, you’re probably not financially equipped well enough to handle the sudden loss of income. I recently discovered that a friend of mine recently quit her job due to high stress and overwhelming hours. She quit without having any other opportunities to fall back on. However, she is fortunate enough that her husband still brings in the bulk of the household income so she is in no hurry to find another job. Many other Americans who have recently lost their jobs can not say the same thing about their situation. Sadly to say, they need to adjust to the new circumstances.

Things To Expect After Loss of Income

Cut Expenses. Money will probably tight if you’re in this predicament, so you will need to cut down on the some of the things that came at a leisure. Cable tv might be one of them. If you have internet and cable, that can run you almost $100 every month. By canceling both, the savings will add up over the months. For free internet, you can go to internet cafes which are becoming more widespread these days. Also, public libraries now offer free internet to visitors.

Be Productive. Work on your resume and submit them to job sites every day. One friend who lost his job last year spent hours in the library, researching and submitting resumes. He just seemed busy all the time, every day. I was impressed that he was very so diligent and active in his job search.

Find Temp Jobs. Keeping yourself busy and occupied is very important. Many hiring managers actually do not like to see any gaps between jobs in resumes. They want to see that you have been active and productive even during the times of unemployment. Working part-time or as a temp can fill that void and also bring in some income while you need it.

Protect Yourself From Job Loss Now

Emergency Fund. You can create a fund for emergencies. Whether it’s for unexpected car repairs or health-related costs, having a fund for emergency purposes can really bail you out of a tough financial spot. Losing your job definitely fits in this category as well. Calculate what your normal monthly expenses are and try to maintain about 8-10 months of savings in the emergency fund. That way, you will have 8 months to find a new job if you were to become laid off. Although unemployment rate has been decreasing as of late, the average unemployment length is still around 8 months.

Gather Contacts. I’ve collected so many business cards over the years working professionally. I still have contacts from my first job 10 years ago. If I were to lose my job tomorrow, I can always use some of these contacts to inquire about any job openings. Save those business cards and keep them safe.

Diversify Income. If you only have one source of income, then you’re not taking advantage of all the resources that are available to us. There are so many ways and methods to earn a few dollars using the internet. So you can start an online business such as a blog. MoneyGreenLife.com has been a nice supplemental income for my household over the past couple years of its existence. Also, my wife will finish school in May, 2012 and will start working soon after. The secondary income from her will also help.

Have you been in this tough spot lately? How did you handle it? What lessons did you learn?

photo: morguefile.com

I took a loan out of my online savings account and paid off my car loan with it. I was budgeting for 2012 and realized that I only have about $4,000 remaining on one of my car loans. The interest rate on that car was a whopping 4.99%! I have been paying a little extra every month to help pay it off quicker. After running some preliminary calculations, if I continued to make my normal payments, it would cost me an additional $97 by the time everything is paid off. It’s not a lot but it is something to think about.

I currently have about $14,000 in my online savings account with Discover Bank. I have no plans to use any of it in the next 12 months so I figured I would give myself a loan to pay off the car loan. I would still have about $10,000 in my savings account for emergency purposes and save $97 in interest at the same time.

However, I earn 1% interest from my online savings account. So the amount I took out would not be earning this interest. I have to subtract this earning from my total savings from this loan. Every month, I will pay my normal $450 back to my online savings account until it’s all paid off.

Even so, I still save some money through this transaction. At the end of the term, I will have all my money back in my savings account and save $78 in 10 months. It’s not going to make me a millionaire, but does help me pocket some nice chunk of change. If you have enough savings saved up, you can borrow money from your account to pay off any high interest debt you may have. It’s guaranteed savings.

In order to stop overspending, we first need to understand the root cause of why we overspend in the first place. We overspend on everything from food and haircuts to car insurance and big ticket items. As a result, we often find ourselves parting with more of our money than we need to. So, if you’re worried about overspending, read on to find out whether you fall into one of the categories below. If you do, it might be time to make some changes.

1. Being reluctant to negotiate
It’s a truth universally acknowledged that negotiating is a little bit awkward. It’s also true that sometimes even the best negotiator fails to get themselves a better deal. However, in the spirit of ‘don’t ask, don’t get’, never bothering to negotiate at all could mean you’re losing out. For instance, haggling or asking for a better deal is accepted practice when buying things such as cars, antiques and insurance packages.

2. Replacing items unnecessarily
This is another common thing that people do: replacing items that don’t really need replacing at all. Electronics such as computers and televisions are good examples of this. The temptation to buy new things is, of course, understandable, but do you really need to replace your car/TV/laptop every eighteen months? When you probably spent quite a lot on the item in question in the first place, it makes sense to get as much use out of it as possible.

3. Failing to read the small print
Not reading the fine print on deals is another reason people tend to overspend. Credit cards are an example of this; very often, they have a great headline introductory rate and so, eager to make use of it, you sign up. What people don’t always realize, though, is that when the great introductory rate ends, the standard rate kicks in – failing to make sure this is competitive means you could end up with hefty interest bills.

4. Adopting too early
New stuff is always great, but there is a danger in adopting technology too early. If a hot product is released for the first time, for example, it’s likely to have various glitches in it that have yet to be completely ironed out. It’s also likely to still be quite expensive because it’s not yet established enough. This is true for everything from electronic equipment to new cars. Often if you want to save money, it’s best to wait a while, for when the price starts to come down and the product is operating at its peak.

5. Compulsion for impulse purchases
This is something that is endemic to many of us: making purchases we never intended to make at all. Of course, sometimes an impulse purchase pays off and turns out to be the best thing we never should have bought. However, all too often we find out that we didn’t really need it in the first place and that, actually, we’d be a lot better off now if we’d mustered the resolve to walk out of the store empty-handed.

6. Rationalizing the irrational
Have you ever found yourself in a store thinking ‘well, it’s on sale, I might as well buy it’? If so, you’re not alone, but this tendency to rationalize purchases you wouldn’t have made if it wasn’t for that great offer/imagined incentive/weakness for a discount can lead to significant overspending – and should be avoided.

If you spend more than you earn, then you will eventually run out of savings and then go into debt. It’s pretty much a guaranteed formula. When you overspend, you lose value in yourself, your equity goes down and your total net worth goes down as well. Overspending is a problem that many of us struggle with and the sooner we come to terms with it, the wealthier we become.  Even if you’re not a big spender on big ticket items such as cars and TVs, the small items that you  do spend on do add up to a big chunk of money. As a result, you will often find yourselves parting with more of your money than you really need to. What do you do when you spend more money than you earn and eventually run out of money? So, if you’re worried about overspending, especially during this shopping season, learn the ways to spend less sooner.

1. Leave Your Credit Cards In Your Car – A lot of times I find myself buying things I really don’t need at work. When I’m stressed, I log on to my favorite shopping portals and look for good deals. It doesn’t matter whether I need the product or not. If it’s a good deal and I’m having a stressful day, the next thing I know is I’m reaching for my wallet and entering in my credit card information. If I leave my cards in the car before going to work, then I can prevent myself from binge buying at work.

2. Wait One Extra Day – Many of us are emotional buyers. If we want something, we need to have it right away. But if you wait a day or two before making that purchase, your emotions could be calmer and you’ll have a better sense of reality. There’s a greater chance that you won’t make that purchase if you wait.

3. Save Your Receipts – Many stores have return policies that could be up to 60 days. If you really want to buy it, go for it but save your receipts. Then if you change your mind, you can always return it. It’ll satisfy your hunger to buy without spending a single penny.

4. Take Cash – Leave your credit cards at home and use cash to shop. When money is right in front of your eyes, it’ll be harder to let go of them. When you use your credit card, it won’t become a realization until your credit card bill arrives a month later.

5. Make a Budget – Nobody likes to make a monthly spending budget because it’s restrictive and not fun. But if you stick with it, it really works and you’ll be on your way to a healthier financial life. Every month you meet your goal, you can take a portion of the savings and reward yourself with something nice. By the end of the year, you can have up to 12 nice things.

There are two super easy ways to save money on a date.  First, make your date pay for the date.  That’s an easy one.  Second, don’t tip the waiter.  Now, if you do this, the universe will pay you back and your car will most likely get towed at work for a week straight!  But in all seriousness, it is possible to save money on a date without being cheap.

The Homecooked Meal
This is probably one of the most underrated dates.  If you have children, make sure they are sent off to the sitter.  Now, this date can roll a few ways.  First, you can create an incredibly romantic atmosphere and do the cooking yourself.  Even if you are not a chef, your mate will most likely love the effort and it will be fun.  The other option is to create the meal together.  This can be lots of fun.  If you decide to create the meal together, make sure to make it interesting and consider a dish you’ve never attempted before. If weather conditions are favorable and you have a decent backyard, a candlelit dinner under the stars, even if it’s in your boring backyard, can actually be quite incredible.  And, of course, don’t forget the bottle of wine.

The Dollar Theater
Movie tickets are expensive.  But the Dollar Theater isn’t!  Nearly every decent sized city in America has some type of discount movie theater.  This is an easy way to save $20.  If you have been applying for a small business loan for bad credit, and need to boost your savings, this is a great way to do it.

Nature Anything
There are two fantastic characteristics of nature—it’s beautiful beyond description and its free!  That is great combination for an excellent date.  All you need is a little creative thought and you can come up with scores of nature dates.  Hiking, swimming, mountain biking, jogging, rock climbing, sight-seeing, etc.  It’s fun, beautiful, romantic, and free.

Kid Swap
If you are married and the budget is tight, date nights can be neglected and left in the corner like a red-headed step-child.  But they shouldn’t!  You just need to adopt a frugal, but not cheap, attitude toward dates.  One of the most expensive aspects of dating once you have children in the picture is the babysitter.  Babysitters today seem to make what engineers and accountant made per hour just a few decades ago!  A decent babysitting can easily run you $12 per hour.  If you go out from 6-12pm, that is $72.  That’s not exactly chump change.  A great workaround is to set up a neighborhood co-op, where you swap kids a few times a month.  This takes your babysitting costs from $72 to $0!

A small business loan for bad credit can be expensive and you should always conduct due diligence before making your decisions.  All it takes to create a great date night is a little creative thought and energy and you can significantly cut down your dating costs but still keep the romance.

Note: This post was submitted by smallbusinessloansdirect.com representative.

There was an article that was released today by CNN reporting that people who are older than 65 years of age are now 47 times more wealthier than those who are younger than 35 years of age. It completely makes sense that older people are have higher net worth and thus wealthier since they had more years to accumulate wealth. That’s not the interesting part. The interesting part is that the wealth between the two age gaps have increased dramatically over the past 25 years. You can read the full article here.

The poll was conducted by Pew Research Center and they took the median household net worth for each age group. According to the study, households that were headed by people aged 35 or younger went from around $11,500 net worth in 1984 to a mere $3,600 in 2009. The 65 year old counterpart went from $120,000 to over $170,000 within the same time span. The study explains how the housing crisis and rising tuition costs are part of the blame for the widening gap in wealth. Although the living conditions and lifestyles have changed dramatically over the years, there are many things that us younger generation can do to improve our wealth.

1. Don’t buy expensive cars – a friend of mine bought a new car. He loves it like nothing else and he has no regrets [yet]. Although it brought him some happiness for the time being, his monthly payment plus insurance on the car is more than 50% of his home mortgage. To compare, the monthly payment for both my wife’s and my car combined is less than 40% of my monthly mortgage payment. I think a monthly auto and insurance payment of 25% of your mortgage is a reasonable amount to aim for.

2. Don’t go to school more than you need to – I have friends who are in their 30s and are still in school. They have yet to have a regular full-time job. It’s kind of ridiculous. Instead of earning a salary, they’re going backwards by accumulating more school loans By the time they’re all done with learning, they’ll have a monthly school loan payment that will be similar to a monthly mortgage payment.

3. Live with your folks as long as you can – I lived with my parents until I was 28. I saved up a boat load of money during that time. I had no mortgage to pay, no rent to pay, and no other bills and costs associated with maintaining a home. Basically, the only payments I was making were my monthly credit card bills and car payments. Other than that, everything else pretty much went into savings.

4. Live with roomies – When you finally move out from your folks’ place to a place of your own, living with roommates can really save you a lot of money. When I bought my house, I lived with roommates for 5 years before finally getting married. During that time, I received over $30,000 in rent money.

5. Invest early – If your employer offers 401k benefit with employer match, participate as soon as you become eligible. If not, open your own retirement account, known as an IRA. Whether it’s Traditional IRA or Roth IRA, it doesn’t matter. Just open one. Consider the following scenario: At age 25, if you contribute a mere $100 a month to your IRA and earn an average of 10% in investments every year, you’ll have $531,000 in your account at your retirement by the age of 65. If you start contributing at age 30 and everything else is same, you’ll only have $325,000 by age 65. That’s a difference of more than $200,000 simply by investing 5 years later. Don’t waste time and start right away.

So, if we young people can make these changes, I’m sure things will turn around for us in no time. What do you think?

Prosper is a personal lending service which connects borrowers with lenders. These days, now that more banks make it harder for people who need to borrow money tougher with stricter rules and guidelines, peer-to-peer lending services such as Prosper come in handy. It basically serves two purposes. Prosper caters to lenders who can receive an average rate of return of more than 10%. This rate is pretty good given how the stock market sucks these days. Prosper also caters to borrowers who have a hard time qualifying for various loans from banks. They can receive rates as low as 8%.

Prosper, launched back in 2006, currently boasts over 1 million members and have funded nearly $270 million in personal loans. It provides lending members a different way to invest their money. Before approving for any loan, lenders can review the borrower’s credit scores, ratings, and histories. Borrowers on the other hand, will post their loan listing, choose a loan amount, and provide a brief purpose and description of the loan. The lenders or investors will then review the loan listings and invest in the listings that meet their criteria. Once the process is complete, borrowers make fixed monthly payments and investors or lenders receive a portion of those payments directly to their Prosper account. Proper receives 1% of all loans for loan servicing fee.

Prosper is not available in every state. It is available for borrowers in all states except Iowa, Maine and North Dakota due to state laws and regulations. Lending services is more strict and is only available in Alaska, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Louisiana, Maine, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New York, Oregon, Rhode Island, South Carolina, South Dakota, Utah, Virginia, Washington, Wisconsin and Wyoming.

How It Works – Investors
As an investor, the process is very simple. You set your investment criteria such as amount, interest rate, terms, etc; invest in the loans that meet your criteria; receive borrower’s payments; and enjoy great returns. You also have the ability to choose your level of risk versus return; have access to pre-screened pool of credit-worthy borrowers; have control over the parameters of your investment; allows diversification of your overall portfolio; and provides gratification of investing in real people. You can invest as little as $25 per loan.

How It Works – Borrowers
As a borrower, the process is also very simple. You provide some basic information about yourself, then check your rates and review your options. Once lenders invest in your loan, money is deposited directly into your bank account. Make your normal monthly payments on-time to avoid late fees, just like any other bank loans. You must borrow at least $2,000 per loan.

Let’s face it, saving money isn’t rocket science; it’s a pretty straight forward process. Why then do so many of us have trouble seeing our savings account grow? Maybe, it’s because we’re not going about saving in the right way. First off, it’s nearly impossible to save without motivation. Ask yourself why you want to save? What are your financial goals? Write down your main goal and be mindful of it whenever you are tempted to spend money you may otherwise be saving. Do you want to save for retirement? A new car? Education? Do you need money for a down payment on a house? If it helps, keep a visual reminder of your end goal in your wallet, checkbook, or as your computer’s background image.

Now that you have the end goal in mind, create financial mini goals and a budget. Ask yourself how much money you need to save by a certain date to be on track. Meeting a monthly savings quota is probably easier than only having a goal every six months, but decide what works best for you. Separate short-term goals from long-term ones. If you plan to transfer 10% of your paycheck every two weeks into savings, you will feel much better seeing your savings grow twice a month. This is highly motivating. Figure out how much money your monthly goal would translate to in a year. Consider this sum as your long-term goal. If you aren’t meeting your long-term goals, you need to reevaluate your short-term goals and dedication.

Overall, be realistic in setting your goals. Don’t decide to save a certain percentage from every paycheck if you can’t afford to do so. Plan on only saving from your mid-month paycheck if bills are all due at the beginning of the month. Don’t get discouraged due to setbacks. They inevitably happen. Just because a setback threw off your savings for one month or two doesn’t mean your long-term goal has to be compromised.

Reevaluate your situation as needed to make that long-term goal date. Before deciding to save with your bank, compare its savings accounts with other financial institutions. Just because you’ve been a valued customer at your bank for years doesn’t mean they offer the highest interest rate on savings. You also should avoid banks that charge a monthly fee. If you are losing $5 a month in maintenance fees, that’s $60 a year. Keep track of your spending.

With debit cards more popular than checks these days, many people forego balancing their checkbook. If you don’t like using your checkbook register to keep track of expenses, use a spreadsheet or other financial software to keep it all straight. Cut expenses whenever and however you can. Cook at home instead of going out to eat and bring your lunches to work. Vacation in the off-season during mid-week, be mindful of the amounts of electricity you are using to cut back on utility bills and scale back on unnecessary insurance, television and cell phone extras. Cutting back on the little things may not seem like much, but they can add up to hundreds of dollars a year. When making cuts, relay all that extra change into your savings account and watch the money add up.

Note: This post was submitted by MoneySuperMarket.com representative

If you have money in the stock market, then you probably already know that you haven’t been doing very well. This year, the S&P 500 is down about 8-10% and about 15% in the past few weeks. Historically, it gave returns of about 10% annually over the past several decades. Whether it’s your 401k or other retirement funds, or simply a more conservative mutual fund accounts, when the market goes down, you will lose money, especially in the volatile economic times. Currently, I have the bulk of my savings in an online savings account and transferred all my 401k funds into money market accounts.  When things return to normalcy, then I will invest normally as well. Until then, I believe cash is king. Although the government promised rock bottom interest rates through 2013, there are still few savings accounts available today that offer at least 1% interest.  That way, you’re at least guaranteed profit as opposed to today’s increased risk factor generated in the market.

Discover Bank
Discover Bank gives out 0.90% through their online savings account, which is over 5x the national average of 0.16%. You need at least $500 to open the account and maintain that amount to receive full 1.10%. If your account falls below this amount, you will not receive the full rate. There is no fee associated with this account.

Everbank
Everbank offers 0.76% through their Yield Pledge Money Market Account. Minimum of $1500 is required to open a new account. There is no fee associated with this account.

Ally
Ally’s online savings account offers 0.89% return on the money. You can open a brand new account with $0, but then you wouldn’t earn any interest on it. There are no hidden fees associated with the account.

ING DIRECT
ING’s Orange Savings account gives you 0.85% interest. There are no fees and no minimums associated with this account.

All these online savings accounts are FDIC insured so you can be confident that your money is well protected. You don’t have to lose money in the times of volatility.

It’s currently the heart of wedding season and it’s evident by the number of friends who are scheduled to become married soon. Studies show that about 41% of the weddings occur during the months of June, July, and August, while only 6% occur in December through February. As my engaged friends prepare for their wedding night, my hope is that they are also preparing for their future, at least financially.

Many marriages fail not because of lack of passion in their love, but more so because their finances do not stand up to their needs and expectations. They fail to communicate honestly about each others financial state before and after the marriage. They often make financial decisions without involving their partner and fail to share all of the important information in all of their financial accounts. I hope my friends will not make these newlywed financial mistakes and that they will become financially educated to make marriage will last a long long time.

1. Be honest with each other before and after the wedding
It’s important to be honest with everything, not just with finances. No one likes surprises, unless it’s a good surprise that’s in their favor. But a bad surprise, such as unspoken student loan debt or hidden credit card debt can be detrimental, not only to financial planning, but also to the overall health of the marriage. My wife told me about her only debt she had before we got married. Her student loan was not small, but because she communicated it with me, we were able to deal with it appropriately. So, whether you have debt left and right or a million dollars saved up somewhere, be honest with each other. When everything is out in the open, smart financial planning can be discussed. If there is debt to be reduced, a plan for debt reduction using schemes such as debt snowball or debt consolidation can be generated. If there is abundant savings available, a smart budgeting plan can be discussed so you can enjoy that getaway vacation you’ve always wanted or the big house you’ve always dreamed of. Remember in marriage, her debt is his debt, and his fortune is her fortune.

2. Make financial goals together
Every big decision, whether finance related or not, should be made together. The small not-so-relevant decisions, if not made together, should eventually be shared with one another to keep each other in the loop. Lack of communication and open surprises lead to arguments. These arguments can be avoided by being honest and truthful with everything. If you are fortunate and have abundant savings available, make decisions together to buy that new car. Make decisions together to buy that brand new 73″ tv. Whatever you want to buy, just make the decision together. If you find yourself in a $10,000 debt, work  and come up with a plan to eliminate the debt, together. Set up a monthly spending budget for each category of all your expenses and stick to that plan, together. My wife and I came up with a spending budget together and we help each other every month to limit our casual spending to not exceed our allotted amount.

3. Share and allow access to all accounts
Prior to my marriage, I had funds in my local bank checking account, online savings account with Discover Bank, online stock portfolio, two 401k accounts, and my HSA account. I shared all of the log-in access to these accounts with my wife. I also had two credit cards, Chase Freedom and Discover Card and provided access for my wife as well. My mortgage payment and all other bill payment access, I shared them all with my wife. The idea is that when both partners know and understand where all of the incoming money is coming from and where all of the outgoing expenses are going to, it becomes just that much easier to make goals together.

Communication is very important. Since my wife is still currently in school, the income from my day job as an engineer is our primary source of income. Since I primarily take care of all of our finances, we take a little time each month to go over where our total net worth stands. If for some odd reasons, we bad one month, we will go over all of the expenses together so we can do better next month. The added level of communication will help us reach our goals quicker and smoother. For now, as long as our total net worth increases from the previous month, then we consider that a good month.