Man relaxing on the beach

Ways to Save on Your Next Vacation

Man relaxing on the beach

As the spring and summer months quickly approach, we are all looking forward to some much needed vacation time. There are typically two types of people when it comes to planning for a vacation. Read the following sceneries and honestly reflect on which one relates most to your approach.

Scenario 1:

You and your friends/family decide to take a sporadic vacation to Mexico during March. The timing works perfectly for everyone, so you buy your tickets at a high season price. As the date quickly approaches, you all have completely forgotten about planning or buying a hotel, so you scramble to find a bouge place to stay. You end up spending way more than you should have due to your lack of planning.

As your relaxing on the beach with friends and family, zero thought goes into what you purchase or where you swipe your card. By the end of the stay, you have racked up a $8,000 bill for your luxury 4-night stay. Was it worth it?

 

Scenario 2:

You and your friends/family decide to take a vacation together at some point during the year. Everyone sits down and searches for the cheapest times for tickets, hotels, etc. Once the perfect date is settled and hotels and flights are purchased at an offseason price, you decide to make a daily budget to follow.

On vacation, you closely monitor your spending and aren’t just whipping out your rewards credit card to exercise your wrist. On your budget, you’ve accounted for extra spending each day so even if some days are more expensive than others, you have the necessary funds for it. Once it’s time to leave, you have a $4000 bill on your rewards credit card, but have enough money in the bank to pay that off immediately due to your proper planning.

 

Some tips to prepare for your next vacation:

  1. Budget. BUDGET! The last thing you want to do after coming back from a relaxing stay at the Bellagio is worry about paying off a credit card that you don’t have the money for.
  2. Use a rewards credit card for purchases. There’s nothing wrong with putting everything on a credit card. As a matter of fact, it’s what you should be doing to avoid having your account compromised. Earn extra money, miles, or gifts by putting everything on your rewards credit card and then pay the balance off to avoid high interest charges.
  3. Book in advance and during offseason if possible. Scenario 1 and 2 stayed at the exact same place but paid completely different prices. Booking well in advance will relieve stress as well as get you the best price. It’s recommended to start planning your vacation a year in advance to give you plenty of time to budget and find tickets.

According to CheapAir.com 2018 Annual Airfare Study, they determined that you should book this far in advanced for the following seasons.

  • Winter: 62 days in advance
  • Spring: 90 days in advance
  • Summer: 47 days in advance
  • Fall: 69 days in advance
  1. Figure out local transportation. You can easily save money by checking if there are local trains, busses, Uber, Lyft, etc. Taking a taxi everywhere will cost you an arm and leg.


Girl holding cash

8 Reasons to Create and Stick to a Budget

50/20/30 Rule to Budgeting

Try to budget with the 50/20/30 rule. What this means is that 50% of your income after tax goes towards nondiscretionary things such as: rent, utilities, food, car payments, etc. Next, 20% of your income should go towards some kind of emergency fund. Experts recommend saving a minimum of 6 months’ worth of expenses. Finally comes the fun. 30% of your income can go towards discretionary items like going out to eat, vacations, clothes, and anything else that you want to buy. 

 

1. Peace of Mind

You won’t have to stress about running out of money halfway through the month. Budgeting properly will lay out your weekly/monthly expenses and tell you how much you can spend. You just need to make sure to follow your budget precisely.

2. Helps you prepare for emergencies

Having an emergency fund set up is crucial. You never know when something bad will happen and the last thing you want to do is take a loan or put it on a credit card. It could take years to pay off the loan or credit card, so budgeting for an emergency fund will allow you to handle whatever life throws at you.

3. Shows bad spending habits

Bad spending habits can be seen through budgeting. You might not realize that you spend $100 on Starbucks every month unless you establish a budget. Once you see a pattern, you can change your habits to save more money.

4. Motivation

When your financially stable and have a clear goal, you’re automatically more motivated. Having a budget motivates you to make more, save more, and spend less. Without this, you might notice yourself slacking in your professional life.

5. Indulge in your wants

With a budget, you can slowly save for things that you don’t necessarily need. It’s better than charging it to your credit card and then having to pay interest over several months. Budget accordingly and maybe cut out certain unneeded things out so you can reach your goal.

6. It can be as simple as you want!

Budgeting doesn’t have to be a super complex task. You don’t need a finance degree to make a simple spreadsheet or plan. There are many online budgeting tools that you simply input your expenses and income. Start your kids out on a budget when they are young so they grow up learning how to use it. The sooner you start, the better.

7. Helps you determine how much debt you can afford

Oddly enough, budgeting helps you figure out how much debt you can actually afford. For example, if you’re buying a new car it can help you determine how much you can spend on a car loan each month. This is important to figure out because imagine how bad it would be to buy a car that is too expensive for you to afford. This happens to a lot of people so budgeting properly will make sure that you can afford whatever you end up buying.

8. It’s fun!

Budgeting doesn’t have to be boring! You can set mini goals for how much you want to save and then reward yourself when you reach that goal. It isn’t always easy, but creating a flexible budget will help you enjoy a financially stress free life.


Multigenerational Family

Multigenerational Households

Generational Family

There are many reasons for multigenerational households. It can be cultural, economic situations, or if you have dependents. There can be a lot of benefits with a full house, but it also requires a lot more planning and has its own set of problems.  

 

Create a new budget 

With more people in a household, you will need to adjust your monthly budget accordingly. Figure out who will pay for what and create a budget based off that. The worst thing you can do is to go into a situation like this blindly and not have a solid plan. If your parents are dependent on you, then you should figure out their needed expenses. This will include doctor visits, medication, and any other special care they require. Being open with your parents about money is going to help tremendously with planning. It will help relieve stress and confusion about their money, making everyone feel confident about the overall finances of the household.  

 

Create an agreement 

Even though they are your family, it’s important to create an agreement for financial expectations. Creating a document laying out rules that are agreed upon will help avoid future conflicts. If there is ever a question about certain finances, it will be easy to pull up the document and look at what was originally discussed. Obviously, this isn’t a legal document, so changes can be made whenever a situation arises that warrants a revision.  

 

Have a conversation about extra spending 

Not all spending will be for necessities. Even your parents want to go out and have a good time, so creating a budget for that is important as well. Cutting expenses might not be needed for many families, so just developing a plan for fun activities will be a good way to create an environment where finances aren’t just a bummer to talk about.  

 

Have a plan for the future! 

Your month-to-month plan should be focused towards an even larger goal. Looking ahead will make sure that your long-term goals will be met. Don’t just focus on immediate needs because you might overlook needs that should have been accessed way earlier to plan for. Having the big picture in mind will alleviate stress for both parties involved.  


Holiday Budgeting

Successful Holiday Budgeting

Holiday Budgeting

Successful Holiday Budgeting Tips

With the holiday season approaching quickly, budgeting for those holiday gifts is going to be super important. Not only will you have your reoccurring monthly expenses, but now you need extra money saved to purchase gifts for your loved ones. Here are some tips on how to prepare.

 

 

Figure out your expenses and make a list

Make a list of all your normal monthly expenses and then add all the gifts you intend to buy. Obviously, the monthly expenses should be the top priority, so once you know how much that is you can estimate how much you are able to spend on gifts or events. It’s super important to stay within you budget because nothing is worse than coming out of the holiday season in debt.

 

Set a limit for how much you are going to spend

Once you have a list of all your expenses, make a limit for how much you can spend. Many people don’t make a limit and overspend on their credit cards. This is a great way to end up in debt and paying interest on those gifts. No matter how special the person might be, giving up your financial freedom isn’t worth it.

 

Sales are everywhere

Check out the sales that are happening near you! Stretching your dollar will help you get the most bang for your buck. Huge retailers typically have flash sales or holiday deals. Make sure to have a shopping plan of where you want to go so you can check to see when their deals are. The best way to stay caught up on deals is to sign up for email alerts. It will save you the hassle of looking online every day to figure out if they are having a sale.

 

Don’t use a high interest credit card

Many banks and retail stores will offer discounts if you sign up for their credit cards, but then hit you with high interest rates. Credit Unions will offer the lowest rates available and many times have 0% APR for 12 months. This could be super beneficial when it comes to spreading out the cost of the gifts. Another option would be to go cash-only shopping so you can be sure that you won’t end up in any debt.

 

The holiday season is a fun time to spend with friends and family. Budgeting will help make this holiday season affordable and stress-free if done correctly!

 


Rear View Of Loving Couple Walking Towards House

What to Expect When Purchasing a Home

Rear View Of Loving Couple Walking Towards House

Mortgages & Home Buying 101

Owning a home is a dream for many people. It’s something they hope to accomplish at some point in their lives. Sure, it is a hard task that requires a lot of work, but with proper budgeting anyone can do it! Mortgages and home buying can be very confusing and scary but researching the steps will relieve some stress. Provided below are common questions and answers people have.

It takes how many years to save for a down payment on a home?

Unfortunately, saving for a down payment on a home can take a lot of hard work and planning. Using the following example, we can illustrate the process you can take to figure out how long you will need to budget for.

Assume you make $56,000 and save around 15% of your income each month. That’s around $8,400 a year. It would take about 5 years to build a 20% down payment for a $216,000 home.

Buying insurance on your loan will allow you to have a smaller down payment but might be offset with greater monthly payments. With proper planning and a bulletproof budget, owning a home can be easy and a great goal to look forward to!

What Should I Expect at Closing?

Once you’ve taken all of the steps in saving, getting a mortgage, and finding your dream home, it’s time to close! There are few things you should be prepared for.

  • Your lender will send you a closing disclosure that outlines the terms of your loan, final closing costs, and outstanding charges or fees.
  • Do a final walk-through of the property to make sure everything is as it should be. For example, make sure any repairs that were made are as expected and that you are happy with your future home.

What to Bring to Closing

  • You will sign many legal documents between you and your lender.
  • Pay attention to all of the costs and escrow items. A majority of the time, the buyer is required to bring funds in the form of a cashier’s check made out to the escrow company.

Present Parties

  • Closing agent
  • Attorney
  • Title company representative
  • Home seller and their real estate agent

Closing Documents

  • Loan estimate and Closing disclosure
  • Initial escrow statement
  • Mortgage note and Deed of Trust
  • Certificate of occupancy


How to Use a Student Credit Card

When it comes to credit cards it’s very important to know key factors on how to use them correctly, especially as a student. If you don’t know how to properly use them, you could end up with a bad credit score or worse: end up in debt. To help prevent those scenarios, here are some tips you should know as a student.

You Choose Your Credit Card, not the Other Way Around

It’s important to not just apply for a credit card because you want a “free” new item, like a shirt or phone case. It’s important to research the company and see if the card you want is actually a good offer. Make sure to check for fees, interest rates and of course, compare it to other companies to see which offer is better and benefits you the most. Like stated in thebalance.com, the best credit cards for students to look for have no annual fees, low interest rates, and a low credit limit.

One Credit Card is Enough

As a student, you have a lot to pay for, especially when you think about your future. College includes having to pay for textbooks, food, rent, parking, and membership fees. Having just one credit card can help limit your spending. This will help you to not build up a ton of credit card debt. With one credit card, you can pay for most of those expenses and only focus on one card to pay off.

Control Your Spending

Don’t go over your credit limit! As a student, you might not focus on how much you spend, but it is very important to understand that getting too close to your credit limit makes it more difficult to pay it back in full at the end of each month. Also, know that credit bureaus do not like when you use more than 30% of your credit limit. To avoid overspending, keep track of the items you purchase and record them so you know if you are getting close to your limit.

Your Card, Your Money

Don’t let someone else use your card! When you apply for a credit card it’s for you to use, not anyone else. It’s your credit card, so it’s your responsibility. Allowing a friend or even a family member to borrow your credit card, even if they pay you back, is risky. Also, lending your credit card can cause you to get close to your credit limit because you don’t know how much they are planning to spend.

A Credit Card is Credit, not Debit

Credit cards and debit cards are two different things. Understanding that a credit card is not a debit card is important; don’t take cash out. This is known as a cash advance; credit card companies can charge from 2-5% cash advance fees and other fees due to the withdrawl. It’s important to stay away from cash advances and to read over the terms that go along with cash advances from your credit card company.

Credit cards have many uses, but it’s important to use them correctly. Keep these tips in mind once you receive your first credit card.


6 Tips on Saving Money this Summer

Summer is the perfect time to re-evaluate your saving’s plan. Here are a few tips on how to keep more cash in your pockets this summer:

A Budget = Your Best Friend

Creating a budget can really help you stay in control of your money. It allows you keep track of how much you are able to spend on certain items and it’s designed to make sure you avoid overspending. With a budget in place, you’ll stay within your means and pocket more savings. The goal of creating a budget though is to stick to it! Be committed to seeing it through to have success.

Look For Free Fun

Going out to have fun is necessary at times, but try to do it a bit less when you want to save extra cash. If you do want to get out of the house, there are a variety of free activities you can do out and about.  There are always free festivals or events going on in the city, you just have to look for them.

Deals Are Golden

During summer time, we all have our adventures planned. But finding deals through the variety of apps and sites available are crucial to having a good time for a low price. You’ll be able to have fun and do it guilt-free when you’ve got a good deal, discount or coupon in tow.

Make Your Own Food

Instead of going and spending $20 dollars a day, you can save more money by meal prepping weekly or making your food at home. You’ll be surprised how much money you can actually pocket if you don’t eat out! As an added bonus, you also become a better chef.

Know Needs From Wants

Try not to impulsive buy; think about whether you really need something or just want it. If you don’t really need it, then save it. The more willpower you have in suppressing each and every want that comes your way, the more in control of your finances you’ll be, and the more money you’ll have in your wallet.

The Big One: Give Your Money A Home!

What better way to save money than to open up a saving account?

At BrightStar Credit Union, we’ve got a variety of options when it comes to saving. See our saving’s options here.

Money comes and goes easily, so be intentional with your cash and what you’re doing with it to become a better saver. The goal for this summer? Have fun, but ball on a budget.


6 Smart Financial Choices You Should be Making

Smart Financial Choices is the Making
Make Financial Choices that Matter

The world is a revolving door of bills, savings, spending and decisions. When we talk about financial wellness, we don’t usually talk about millions. We talk about living within your means. This means you have to make financial choices that will benefit you. For example:

 

  1. Create an emergency fund

Every single one of you, regardless of how much you make should have an emergency fund. Unfortunately, more than 50 million Americans forget about this very important financial choice.

This very important aspect of savings will help you take care of unexpected life events that will require you to spend money. The last thing you want when an emergency arises is stress about money. This fund will help you get to your next step easier.

 

  1. Embrace minimalism

Do not spend money on things you don’t need. Yes, you may treat yourself once in a while but if you are going out every weekend or changing your house décor every 2 months; STOP!

Take a step back, breathe and ask yourself “Can you live without this?” If the answer is yes, then put your credit card/cash back. We cannot stress this enough; you must live within your means. Once you start doing this, you can actually start achieving other goals like traveling, saving for a home and go on a shopping spree without having a huge financial strain.

 

  1. Make your money accrue interest

Growing up I heard everyone older than me say that financial stability came along when you figured out a way to make your money make own its money. CD’s and Money Market Accounts are the perfect way to make your money accrue interest by just letting it sit. It is also the perfect way to get disciplined with your savings. CD’s and Money market accounts are also a guaranteed way to make money because they do not rely on the stock market to grow. You just need patience.

 

  1. Change your insurance

We briefly mentioned changing your insurance on our “How to Make a proper Budget” blog. The internet has made research easy. Changing your insurance is research you should be making. See how you can take advantage of discounts, promos and benefits that can help you reduce the cost of your insurance.

 

  1. Save money on gas

Gas is one of those little things that makes a difference. If you live anywhere in Florida, you are spending money on gas. A way you can start saving on gas is buying or switching into a smaller car. This may not be possible if you are a parent or have a big family, but if this is not something you need…CHANGE IT!

 

  1. Find ways to make extra money
    Making a little extra money is smart- especially when you want to treat yourself a bit more. You can use APPs and websites like eBay, Offer Up and Facebook to sell gently used items. You can open a separate Savings Account to add the little extra money you are making. The extra dollars can help you pay for a plane ticket and help you pay for a vacation. It can also make it easier to grow your Emergency Fund.

 

Try to follow these tips to help you make better financial choices. It is the little changes that make a difference in your financial well-being.


Create a proper budget

How to create a proper budget

Create a proper budget
Start Budgeting today

Budgeting is the little plan in 2019 that will keep you financially organized and stress-free. However, to make an accurate budget you must have a clear picture of what your goals are.

For example, aside from paying bills this year, you will also like to travel and buy a home. Both are achievable but will take some discipline in your part.

Before you start, go through find ways to reduce your bills.

Reduce Your Bills 

We can thank the internet for making research and price comparison a lot easier. Basically, your first job is to review how to lower your main bills. You should try to reduce your car insurance, phone bill and internet payment. Take around 2 to 3 days to make accurate research and try not to fall for hidden fees.

 

Second, make a list of any additional expenses you have. These expenses are your wants. They will probably include coffee trips, friend dinners, splurge shopping and any expense you simply do not need to do. Minimalism is key when it comes to sticking your budget. After you have written these out find a way to cut them by 80%. Start making coffee at home and have a home-made breakfast with your friends instead.

Prioritize your Bills

Your budget will be divided in 3 parts. Your goals, emergency fund and everyday living.

Set aside 5% of your income after taxes and make this number your emergency fund goal. You will not touch this money unless you absolutely need too.

Then write down every expense you have. Starting with your groceries and ending with your favorite leisure expense.

If your end result shows more income than expenses, you are off to a good start. This means you can prioritize this excess to areas of your budget such as traveling and retiring. If you are showing a higher expense column than income, it means some changes will have to be made.

Make adjustments to expenses.

 If you have accurately identified and listed all of your expenses, the ultimate goal would be to have your income and expense columns to be equal. This means all of your income is accounted for and budgeted for a specific expense or savings goal.

If you’re in a situation where expenses are higher than income, you should look at your  “wants” to find areas to cut. Since these expenses are typically non-essential, it should be easy to shave a few dollars in a few areas to bring you closer to your income.

Review Your Budget Monthly

It’s important to review your budget on a regular basis to make sure you’re staying on track. After the first month take a minute to sit down and compare the actual expenses versus what you had created in the budget. This will show you where you did well and where you may need to improve.

Most importantly, keep yourself organize. A budget only works if you are willing to follow it and put in the work.


Safely file business Taxes

How to ensure that your business taxes are filed safely

How to ensure that your business taxes are filed safely

Safely file business Taxes
Safely file business Taxes

As a business owner, your number one priority is safeguarding the interests of your enterprise, which is why you should take extra precaution to ensure that your information is protected when filing your business taxes. These tips will ensure that your returns are filed safely, and your information remains uncompromised.

Practical protection

Tax returns require sensitive information pertaining to your business as well as personal details which make them attractive to hackers and identity thieves.

Since the Internal Revenue Service requires you to keep your tax filings and supporting documents for a minimum of three years and a maximum of seven years. The agency advises that you keep all paper documents locked safely away.

A locked drawer or cabinet are good options, but your best bet may very well be a hidden, fireproof safe.

When working with a tax professional, take the time to vet their credentials before you hand over any sensitive documents. If you choose to file on your own via tax software, make sure that your computer is equipped with up-to-date anti-virus and anti-malware software and that you are protected by a firewall.

If you store your documents on your computer for record-keeping purposes or for electronic filing, the IRS recommends installing software designed to encrypt your files and backup drives to prevent important information from being stolen.

Once you’re ready to cycle out older tax documents, the IRS advises that you shred any paper documents thoroughly to prevent identity theft. For electronically stored documents, you will need to wipe your drives before selling or disposing of an old computer or external drive.

Delivery methods

Before you send off or hand over physical tax paperwork, The Balance’s William Perez and Beverly Bird advise that you make a detailed list of everything you’re sending and make copies of every document. You can scan and save the documents as PDFs on your computer. To get an extra layer of protection get add secondary copies to a flash drive or an external hard drive.

Having readily available backup copies will reduce the stress that occurs if something should go missing en route to your accountant or to the government.

If possible, Perez and Bird suggest hand-delivering your documents to your accountant or professional tax preparer, as this serves as the best option to ensure the safe filing of your documents.

If your accountant is too far to reach in person, it’s suggested that you spring for delivery or signature confirmation and that you maintain your tracking information to monitor your documents’ progress. Additionally, Try not to use email.

Never send sensitive details within the body of an email and ensure that all documents are encrypted and password-protected.

Your tax paperwork is too important to the health of your business. By taking the proper precautions, you can better ensure its success and stability without having to worry as much.