We all know that personal sloppy banking can cost you, but so can another person’s sloppy banking. Especially if you’re doing business with someone in another country.

I was working for a client last year who got lame, and I quit, but not before following through on my contracted work. I invoiced and to shorten this up, finally (five months late) sent me a check just last month. The check was, by the way, Canadian so I lost money on it, me being in the U.S. but I was sick of this client so I took the loss, cashed it, and it seemed fine.

Half a month later I’m looking at my balance in my account and notice two large fees. One from my bank and one from the foreign exchange end of my bank PLUS the Canadian check was returned so that money was gone from my account as well.

It cost me something like $50 in fees to work for them. PLUS I still haven’t been paid. My point here though is about the check fees. I called my bank and told them, I’ve never even had an overdraft fee, and this fee is not even my fault so please return it. They did. Then I called the foreign side of my bank and they said, we can’t return the $35 fee, because their check bounced so you have to work that out with whoever gave you the check.

If you’re doing business with people in another country, your bank can possibly charge you fees that won’t be returned if those people pay you in dud funds. I had no idea I could be punished for someones mistake, or I should say their sloppy foreign banking skills.

Long story short, if you’re dealing with money from someone in another country, and you don’t totally trust them, it might be smarter to request funds in a money order or by PayPal. My issue is getting worked out, but trust me, it’s been nothing but a huge flippin’ hassle.

[image via stock.xchng]

In case you missed Dave Ramsey’s Town Hall for Hope broadcast (or if you’d like to see it again), you can watch it for free on Hulu. 

Here’s a few things I tweeted or heard Dave say during the event:

• When things are going well, we get a little sloppy.  We’ve become a bit sloppy. 
• When things are going good any idiot could make it.  Even a turkey can fly in a tornado.  Stupidity has been officially stress tested.
• When the tide goes out you can tell who was skinny dipping.
• Fear is not a Fruit of the Spirit.
• Bush decided to bailout stupidity and then the new administration decided to stimulate stupidity.  I’m not a big fan of government interference in the marketplace.
• You can be sincere and still be wrong.
• I’m a believer in capitalism, but the not the kind of capitalism we’re seeing.
• Those of us in business are supposed to take care of our customers, not milk them like a cow.
• Commerce without morality will destroy us. ~Ghandi
• Life’s not fair. Sometimes it hurts. We need to allow failure. Failure is good. Failure brings clarity. It’s cleansing. Failure will steer you toward excellence.  A little desperation is good for the soul.
• I don’t do business with big banks because they have no soul.  Use a local hometown bank.

Listen to Town Hall for Hope for free on Hulu.

We’re finally selling our house.  You’d expect me to be jumping up and down with excitement, but I’m not.

You see, almost four years ago we bought a house.  We lived in it, fixed it up, and cared for it.  We wanted to make it a special place for our family.  Now here we are selling it and taking a loss.  A big loss.  We actually have to borrow money to sell it.  You may be wondering why I would be borrowing money to sell a house.  Well, it’s been on the market for eight months.  As you can imagine, the upkeep on a home can be very expensive and then add to it rent and utilities in another location, and it leaves us with little money left each month.

For eight months, we have been paying a mortgage, insurance, taxes, and utilities on a house we’re not occupying.  All of this while the housing market is down.  We’ve had people interested in the house, but none that could come up with the money.  The city where the house is located has seen a lot of lay offs.

You may be wondering why I wouldn’t just hang on to the house and wait until the market picks back up.  There are several reasons for this. 

1)  This is the first offer we have received on the house.
2) We don’t know when the market will pick back up again.
3) The financial strain needs to stop.
4) The market where the house is located is far worse than it is here.
5) Houses where we currently live cost a lot more.
6) Interest rates are the lowest they have been in many years.
7) Reasons #5 and #6 equal the reason we can afford to buy a house now.

Let me make this clear:  I hate debt.  This is not the road I want to take, but right now it seems like the only option.  And with rates being the lowest they’ve been in years, we can actually afford to purchase a house here.  The money we’ll save in interest far outweighs the loss on the other home.

I’ve had several people suggest a shortsale on the house, but everything I’ve read about shortsales messes with your credit.  (Shortsales are a better alternative to foreclosure though.) 

Sorry, this is no money saving lesson for today.  This is just a lesson learned and some thrifty struggles, weighing options, and finding the best way to get through it.  I’m hoping things are financially well your way.

images (c) Karen Weideman

A money saving book review today for you guys…

Book: Expecting Money: The Essential Financial Plan for New and Growing Families (Paperback) by Erica Sandberg

Cost: $12.44

Basics: This book is set up to help you budget for your family, no matter your financial or marital situation. Below is Sandberg’s website description of the book:

“No matter how much you earn, own, or owe, having children will dramatically alter your financial picture. Whether you’re thinking of expanding your family, are pregnant now, or have recently had a baby, Expecting Money: the Essential Financial Plan for New and Growing Families will help you prepare for the economic demands of parenthood. From setting a financial start line to developing a comprehensive new budget, you can build lasting security with the techniques outlined in this guidebook that is designed specifically for the most important time in anyone’s life – beginning a family.“

What I think…

Erica Sandberg is a nationally recognized credit and money management authority. She’s accumulated over a decade of experience working with folks and writing about both personal and business finances. It’s easy to tell, after reading this book, that Sandberg is indeed an expert. This book is highly comprehensive and perfect for all types of family situations. Perks I enjoyed included:

Logical time-line of information. For example, the book opens with a couple of chapters that help you understand both how financial issues work, which money matters should concern you personally, and how to figure out where you are now on the path to financial success. The book then moves on the pregnancy money issues, then baby money issues, child care, and so on.

Covers relationships + finances: The book not only covers partner money dynamics but also solutions for those not in relationships (single parents). Many budgeting family books I read leave out single parents, and being a single parent myself it’s awesome to see an entire chapter devoted to this financial experience.

Covers consumer issues: One thing I liked about this book was the coverage given to consumer choice. I’m big on consumer choice as a money saving issue, and this book dives into this with topics like marketing to parents and pressure to buy products when really it’s unnecessary.

Future financial goal coverage: The second to last chapter, “Making It Happen” covers all sorts of ways to manage your future finances. Big issues like life insurance and planning for emergencies are covered but so are some fun things like vacation savings.

Budget planning help: The last chapter is a total how-to on planning your family budget. From setting goals, to tracking expenses, to crunching numbers, this chapter can help just about anyone plan for a more successful budget.

OVERALL SCORE:

For the price (not expensive) I’d give this book 5 out of 5 stars. It’s positive and upbeat without being one of those lame, “BUILD WEALTH NOW!” sort of deals. This book isn’t preachy it just offers solid advice that’s digestible in small chunks. Lastly, it’s practical and contains plans that should be easy for even non-financial types to implement.

Check out Expecting Money: The Essential Financial Plan for New and Growing Families at Amazon or take a look and see if your local library carries it.

Annually there are some specific tasks you should be doing when it comes to your finances. You can break your basic financial tasks down into easy monthly chunks.

Monthly: (Note - I actually do many of these tasks on a daily or weekly basis, depending on the task, however, at the very least do the following once a month).

• You should balance your checkbook at least once.
• Check your bank statements for errors.
• Sort bills and pay them. Then decide which bills to keep (see below).
• Sort your bills to keep into a folder, file cabinet, or other sort of safe-keeping system.

Every 3-6 months:

• Restock your bill paying supplies at your bill paying station. If you pay bills online yay, you can skip this step. If not restock stamps, envelopes, pens, and so on.
• Shred any old financial paperwork you no longer need. If you do this every 6 months, you should have some papers that can be purged.
• Check to see if you’re on track with your money goals. For example, once a year you should set financial goals, but you’ll be more likely to stick with them if you check up on them and update them as needed.

Annually: (if you do the annual tasks around the new year it’s helpful as you can sort your tax info then).

• Set new money goals for the year and revamp your money systems if you’re not happy. For example, if you’ve been trying to save using an envelope system and it’s not working consider switching to a writing all your spending down system.
• If you keep an ongoing budget on paper or on your computer - update any changes.
• Locate any paper work you need for taxes.
• Check your credit report. You can do this more often though, but once a year at least is wise. Make sure to deal with any mistakes you see asap.
• Shred any old financial papers you really don’t need - old paid off loan paperwork, closed credit accounts, and so on.

WHAT TO KEEP VS. SHRED:

Unless you specifically need one of the following for tax purposes there’s no reason to hang on to these items for more than a few days… ATM receipts, store receipts, credit card statements, or basic bill stubs (cable, phone, etc). If you need a receipt for a big purchase keep it with your warranty items. Check your credit card statements for mistakes then shred.

• Insurance policies - keep current ones and shred the old.
• Medical bills - keep for three years or for as long as an ongoing condition exisits.
• Records of sold property - i.e. a car, house, and so on big ticket items. Save forever pretty much. These items should take up too much room in your file cabinet and it’s better to have proof of sale than not.
• Social security statements - I keep all my annual reports filed away but I know some folks only keep their most current one. I’ve also heard both sides mentioned by experts in the money field so I’m gonna say stick with what you’re comfortable with here.
• Taxes and tax records - keep for seven years.
• Mortgage and automobile records and bills - keep for as long as you own the item.
• If you have items like mutual fund statements keep the annual reports and shred the rest.

[image via stock.xchng]

I thought we’d have a little informal poll today. Here’s the situation, I’ m really anal about balancing my checkbook. I have to know, at all times, what’s in my checking account. To the penny. I never even pay bills automatically because I hate when companies take my money and I didn’t write it down on that exact day. I’d rather take the time to get online and pay myself.

However, it’s looking more and more like I’m the rare one because everyone I meet says, “I never balance my checkbook.” My son’s dad was that type. He never wrote stuff down, he’d just call his bank every once in a while to see if he had enough money in there for bills or say, when he wanted to write a check. Needless to say, we did not share a checking account because I would have gone insane.

Two of my best friends are also that way. They never balance their checkbooks. One of these friends told me that he worries less because he doesn’t balance his checkbook daily. He says, “I know I have money in there and if I messed with it, maybe I’d start to worry about cash.” On the other hand, my other best friend just got an overdraft fee because she never balances.

Here’s my take - is everyone nuts!? I’m not seeing how this new not balancing your checking account deal is sweeping the nation. In my opinion, this can lead to more not less worry and cause things like the previously mentioned overdraft fee. Maybe if you’re rolling in cash, checking the account becomes a moot point. I however am not rolling in cash and neither are most of my friends, yet, they’re not balancing their checkbooks.

To me this is sloppy banking, but it seems like I’m the only one who thinks so. SO tell me - how do you deal with your checking account balance? Do you balance each day; when you buy something; never? Let me know how you deal and what the pros of your system are.

[image via stock.xchng]

Guest post by Heidi.

Cutting back on expenses is just like cutting back on favorite foods to lose weight: the pain is intense in the beginning, but I promise you – it’s short-lived.

We started curtailing our spending a year ago. At first, I didn’t think I’d ever be able to live with the lifestyle changes . . . but I quickly learned that when you remove excess from your life, only good things will follow.

How do you start a money diet?

Like a food diet, hit the big items first. Pretty soon, you’ll be able to see smaller expenditures in your budget that can be cut out, too.

Here’s a list of the top 10 items that we cut out, in chronological order. You can probably go through the same exercise … You’ll be amazed at how quickly you can stash away cash you never knew you had!

1.  Cut: A Yearly Disney World vacation.  Cost:  $3,000.
Substitution: More short trips to visit extended out-of-state family. Disney-vacation frequency curtailed to once every two to three years.

2. Cut: A planned purchase of a new $25,000 pontoon boat.
Substitution: We waited for off-season sales on eBay and found a used boat in January for $4,000, in pristine condition.

3. Cut: New cars, to be replaced every five years at a minimum. ($30,000 average price)
Substitution: We’re running the old cars into the ground until we can’t drive them anymore! Repairs are nominal compared to monthly payments. We’ll buy used cars when ready.

4. Cut: Weekly restaurant dinners, averaging $75 for two with drinks and dessert.
Substitution: We grill at home now. Restaurant dates are once every six weeks.

5.  Cut: Movies, now at $17 for two tickets.
Substitution:  A Netflix subscription, for $5 per month and unlimited rentals.

6. Cut: Frequent trips to book stores, averaging $50 for new books and magazines each visit.
Substitution: The public library. We visit weekly and have also discovered other programs for families (family movie night, for example), free DVD rentals and even magazines.

7. Cut: Regular trips to Best Buy for $50 video games.
Substitution: A second-hand video gaming store at the mall offers the same games for a fraction of the price. When we decide to try a new game, we receive money for one that we no longer play and buy a used game to take its place.

8. Cut: Weekly trips to liquor store, averaging $75 each. Regular visits to Starbucks, $4.50 each.
Substitution: Occasional bottle of wine, $7-$9. Cutback in drinking reduces need to buy as much! Starbucks has been replaced with store-bought coffee, combined with flavored syrups and whipped cream.

9. Cut: Monthly clothing purchases from catalogues, averaging $200 to $300 minimum.
Substitution: Except for our child, who grows out of his clothing, we have cut this expense completely. We wait for off-season sales to purchase items at 60 to 80 percent off. We also combine our better-clothing items with cheaply-purchased items from discount stores like Wal-Mart … combining the two camouflages the less-costly item.

10. Cut: Gourmet impulse purchases in grocery deli.
Substitution: Online recipes for similar products allow us to make many of the same items for much less. The result is a healthier alternative (because we know the ingredients) and also more enjoyment in the finished product. We occasionally splurge on a longed-for item, but these are now “treats” rather than regular purchases.

image sxc.hu

Heidi Rafferty is a freelance writer and blogger. You can find her work at Kingdom Treasures and The Objective Journalist.

Yesterday I told you about Dave Ramsey’s envelope system which helps budget your money so that you don’t overspend.  I’ve been thinking more about budgets and realize this is a subject that needs to be addressed and it’s also an area in which I need improvement.

A study of Harvard graduates showed that those with with written goals achieve more than others.  Some words from Dave Ramsey:

Your budget is a written goal for your money.  People who win at anything have written goals.  Goals are what you are aiming at.  Your money won’t behave unless you tame it.  You need to have a budget for every month.  Spend every dollar on paper before the month begins. Give every dollar of your income a name before the month begins.  This is called zero-based budgeting.  Income-outgo=exactly zero.  Match up every income dollar until you have given it an outgo name (this includes savings).

We have learned the importance of saving for rainy days and having an emergency fund.  We are trying to live a debt free life, even with two house payments.  (Yes, it still hasn’t sold!)

How is your budget?

image from daveramsey.com

As I’ve mentioned before, my husband and I have attended Dave Ramsey’s Financial Peace University classes at our church.  These classes were very beneficial to our finances, as well as our marriage.  Finally, we were on the same page financially and were both working toward paying off debt and saving.

One of Dave Ramsey’s tips for budgeting is to use an envelope system.  You simply make an envelope for every area spending which can include: groceries, gas, childcare, entertainment/eating out, clothing, and more.  The envelope system is a great way to keep you from spending more than you had allotted.  It may take a few pay periods to find the right amount for each category.

No Credit Needed has posted a great envelope tutorial on youtube.  Check it out.

Are any of you using the envelope system?

If you’re getting married or considering a life with a significant other, then you should discuss money matters before hooking up for the long term. Some money issues just need a little discussion, while others are MAJOR warning signs that late on there could be problems.

Things to discuss:

Your spending priorities: Are both of you interested in saving for a house, kids, a car, or is only one of you into that? Do you have different spending styles? I.e does one of you live to shop while the other is a minimalist.

Do you agree on how much money should go to charities or other community organizations?

Do both of you anticipate long-term employment, or is one of you considering a career switch or quitting work entirely somewhere down the line?

Do you agree about loaning money out to friends and family - how much and how often?

ISSUE: Your partner and you balance the checkbook differently.

Not too big a deal, but keep separate accounts. My ex and I shared all our cash equally, i.e for bills and what-not, but kept our actual money in different accounts because I’m anal, and need to balance my checkbook daily, while the ex liked to call the bank once a month to check his balance. He always sort of knew what was going on, but that’s way too casual for me.

ISSUE: One of you has debt.

Sort of a big deal, but it could be worse. Just getting married or involved for the long-term won’t mix your credit scores, so long as you don’t open any joint accounts. However, renting and setting up utilities can be hard if the place needs both your names and one of you has sucky credit. The best thing to do is to make sure that the partner with poor credit is working on it, trying to improve it and in the meantime keep your names as disconnected as possible when it comes to credit cards and loans. Poor credit is not great, but doesn’t have to be a partner deal breaker (like the issue below).

ISSUE: Your partner gambles.

A HUGE deal. Take it from someone who knows folks who have been there. A gambler is a huge financial risk if you get involved for the long term. You can’t change their habits, they’ll need to. You may end up hiding your wallet, getting into debt, or dealing with a violent individual who is mad that you don’t like their habit. THINK very, very carefully before getting hitched with an addicted gambler (who is not in recovery).

[image via stock.xchng]