How Changing Due Dates on Your Bills Can Help Shore Up Your Monthly Finances

Student loans are a huge burden but they don't necessarily have to be. It's possible to lower your monthly student loan payment with the right tips.

Nearly every financial adviser stresses the importance of creating a household budget, a practice that helps curtail spending and often prevents expenses from spiraling out of control.

If you’ve already taken this step and continue to struggle with the balancing act between monthly income and expenditures, it can start to feel hopeless. But there’s still hope: another approach to consider is changing the due dates of your bills.

It’s a tactic few people think to implement, but one that can help steady the monthly financial rollercoaster.

“Simply lining up bills with your income allows you to have a lot more control over your finances and where your money is going and when,” said Kyle Whipple, of Michigan-based C. Curtis Financial Group.

All you have to do is call up creditors, utility companies, or any other business in question and request a due date change. Most are willing to work with customers on this issue.

Still not convinced? Here are five ways that taking such action can improve your monthly finances.

1. Spread Big Expenses throughout the Month

Having multiple major bills (like mortgage or rent, car payments, daycare costs, and utilities) due at the same time of the month can translate into a serious cash flow problem.

Rather than be tapped out by paying several hefty bills all around the same time, try shifting the due dates for one or two bills to later in the month, after you’ve received another paycheck or two.

“Sometimes pushing one of those bills to the other part of the month allows you to have more cash flow on both sides of the month,” said Whipple.

2. Clarify Exactly How Much Free Cash You Have

Some people spend blindly—and when bills come due have little money left to pay them. To avoid such a scenario, arrange to have your bills due as close as possible to your payday. This also helps make it clear exactly how much free cash you’ll have to use for other things throughout the month.

“Lining up bills with your payday allows you to get that money out of your bank account as soon as possible, so you know how much money you have left for the rest of the month,” said Whipple.

In addition, rearranging your bills this way, especially when you’re living on a tight budget, ensures that the bills are a top priority, says Dawn-Marie Joseph, founder of Estate Planning & Preservation.

“The closer you can pay the bill to when you receive your paycheck, the better chance the bill will get paid,” said Joseph. “It’s just great discipline for yourself.”

3. Avoid Late Fees, Excessive Interest, and Lower Credit Scores

A 2017 study from the National Foundation for Credit Counseling reported that about one in five people (22%) do not pay their bills on time. And it’s no secret that paying a bill past its due date often involves a penalty in one form or another—whether it’s a late payment fee, an increased interest rate, or a lowered credit score. (You can check your credit score for free on Credit.com.)

“When people miss a bill, over time those overage charges or the interest adds up,” said Whipple. “Between that and overdraft fees on your bank account when you don’t have enough money there to cover a bill payment, it can be dangerous.”

Adjusting your bill due dates so that you know exactly when they’re due can help avoid overlooked payments or payments missed due to a lack of sufficient funds.

4. Eliminate Uncertainty about Monthly Due Dates

According to Whipple, most people pay bills when they get a notice that the due date is approaching and have no clue what the actual due dates are each month.

Requesting a specific date that you have decided upon, such as the first or the 15th of the month, eliminates such uncertainty. This helps you remember your due dates and pay those bills on time.

5. Prevent Unnecessary Credit Card Spending

It’s not unusual to reach for a credit card as a stopgap when living on a limited income or when your cash flow has run dry after paying bills. But it’s not a good long-term approach to balancing your monthly budget.

Rearranging due dates can help spread your bills out or align with paydays so that you have adequate cash flow to get by without relying on credit cards.

“If you’re on a single income or a tight budget, making sure you know when you need to pay bills is huge so that you don’t overspend and end up using a credit card,” said Whipple.

How to Request a Due Date Change

Most companies make it fairly simple to change a bill’s due date, even allowing customers to do it online. Many utility companies even call it out as an option on their websites.

“Most people don’t realize you have leverage to call up and ask to change the date,” said Whipple. “It doesn’t hurt to ask. The worst-case scenario is they say no.”

All that’s left now is to implement these tips and take control over your bill payments. Your wallet will thank you.

Image: Jacob Ammentorp Lund

The post How Changing Due Dates on Your Bills Can Help Shore Up Your Monthly Finances appeared first on Credit.com.

Clever Ways to Make Homeownership More Affordable

We all know that aiming to live well below your means will help you save more money, get out of debt, and get ahead financially overall. To supercharge this process, you may want to consider attacking your largest expense: housing.

Just being able to save $200, $500, or more each month on housing could put a large dent in your debt repayment or help you seriously pad your savings. Reducing or eliminating your housing expenses might sound difficult, but there are so many different strategies, at least one could work for you.

What’s more is that these options don’t have to be permanent. You can always go back to a more traditional housing situation once you feel like the arrangement has run its course.

See if one of these ways of cutting your housing costs might work for you.

Be Energy Efficient

The eco-revolution is here, and as a result, there are so many ways to save on utilities. A bonus is that some energy-efficient modifications and products can help you earn federal tax credits.

The list of things you can do is long and can get expensive, but there’s some low-hanging fruit when it comes to reducing your energy consumption:

  • Stop air leaks with caulk, insulation, or weatherstripping
  • Swap out incandescent lights for LED lights
  • Turn down your water heater and get a jacket for it
  • Plug your devices into powerstrips that minimize idle current usage (or unplug devices altogether)
  • Use rainwater barrels for your outdoor water needs
  • Air-dry your clothing
  • Choose light colors on flooring and walls to minimize artificial light use during daylight hours
  • Program your thermostat
  • Get alerts for higher priced kilowatt rates during certain hours of the day

You get the point. The more you can minimize your energy use, obviously the more money you’ll save on these costs. Pick a few that work for you, then use the money saved to get ahead in your finances.

Put Your Bills on Autopay

Not only will this small gesture save your sanity, it could potentially save you fees and penalties connected with late payments. You can set up automatic payments to be deducted from your bank account or a credit card account. If you choose the latter, be sure to avoid carrying a balance from month to month and pay your credit card bill on time as well. Otherwise, the interest and late fees from missing your credit card payment could cancel out the benefits of your autopay setup.

Appeal Your Property Taxes

If you’ve ever gotten those solicitations in the mail from companies that claim to reduce your property tax bill, don’t put it in the junk pile quite yet. According to the National Taxpayers Union, up to 60% of U.S. properties are over-assessed. This means that 60% of Americans could be paying inflated property tax bills.

Many property owners don’t even know that they can get their property tax bill reduced via an appeal process. Because of this, it’s very possible that you are paying too much for your property taxes.

The appeal process to get your taxes can seem daunting, but it’s usually a string of paperwork and deadlines. Of course, you’ll be dealing with government entities so that could add a layer of complexity to the whole ordeal, but it’s not insurmountable.

If you have the time and ambition, it’s a process you could easily undertake yourself. If not, it may be worth hiring help to file and follow up through the property-tax appeal process. If the appeal is successful and your property taxes are reduced, you’d fork over a portion of the savings to the firm or person you hire.

Shop Around for Insurance

If you’ve got home insurance, you are likely to have other policies for vehicles, and perhaps you also have coverage for health and life insurance benefits, too. If you’ve got insurance needs that require multiple policies, you can leverage your buying power to shop around for better rates.

Shopping around for insurance can seem straightforward, but be ready to use your brain to the utmost in this endeavor. Not only will you need to compare prices, but you’ll also want to compare things like coverage amounts, premiums, deductibles, and available riders at the quoted prices.

Fortunately, there are comparison sites and independent insurance agents that can make this task a little easier. Either way you do it, it’s a good idea to check around every once in awhile to make sure your current insurance provider is being competitive and offering you the best rate.

Become a DIYer

One of the most costly expenses of owning a home can be maintenance, repairs, and upgrades. Save money by learning to do some things around the house yourself. There are many resources to help you with anything you don’t know much about, from books, to websites, to YouTube. Though it can take more time, you might come out ahead by cutting your own grass or installing your own kitchen backsplash.

If you’ve got complicated jobs that require special expertise and equipment, consider a partial DIY approach. For example, if you’re redoing your bathroom, you might ask the contractor about things you can do yourself to shave the bill down some. Demolition and cleanup of existing fixtures might be the type of work you can handle.

Don’t be afraid to experiment, but definitely be wise about the projects you decide to take on yourself. Finding the right balance between hiring and DIYing can save you time, money, and headaches as a homeowner.

Rethink Your Home Purchase Plan

Getting a conventional mortgage with vanilla terms that include a 10%-20% down payment and a 30-year loan period are all too familiar to the home-buying public. But if you really want to save on the single largest expense in your life, you might have to be a little more flexible than the standard terms accepted on most home loans.

Larger Down Payment

One approach to consider is putting down at least 20% on your home purchase. This will allow you to skip private mortgage insurance (PMI), which can amount to thousands of dollars over the life of your home loan. PMI can eventually go away over the life of the loan when certain criteria are met, but you can save more money by dumping it sooner than later.

Refinance Your Mortgage

Many people refinance their homes in hopes of getting a lower monthly payment or locking in a lower interest rate. Adjusting these numbers downward can definitely save money for some homeowners over the long run.

However, refinancing your home loan is not a silver-bullet solution that will work in every scenario. In some cases, it makes perfect sense to refinance, and in others, it wouldn’t be a good idea. The best thing to do is run the refinance numbers and make a decision. After doing the math, you might actually find that fees and extended loan terms could cause you to lose money rather than save it.

Make sure you fully understand the terms of your refinanced mortgage along with the potential impact on your entire financial outlook. Most definitely, confirm your assumptions about this move with math. If you need help running the numbers, check out this refinance calculator from myFICO.

Pay Cash for Your Home

While not an option for the average American, paying cash for your home is not unheard of. Paying cash for a home would eliminate tens, maybe hundreds of thousands of dollars in interest, mortgage fees, and PMI. If you think you’d like to go for the gusto and pay cash for a home, consider ways to make this feat possible:

Make Some Lifestyle Changes

Though these options aren’t for everyone, they are still worth a mention. These suggestions are for those who might be willing to change their lifestyle in order to garner the most savings possible when it comes to housing.

Get a Roommate (or Two)

The home-sharing revolution has caught on, and everyone from young professionals to empty nesters are finding boarders on places like Craigslist and Airbnb. If it works out, it can truly be a good solution to help lower your housing costs. Plus, having a roommate can be temporary or longer term, based on your living preferences.

Again, this option is not for the faint of heart. Adding a roommate to your living equation could be utterly disastrous or surprisingly pleasant, so choose your housemates wisely.

Buy a Multifamily Unit, Rent One Unit Out

Depending on the location and property type in these situations, homeowners can often cover their entire mortgage amount with their renters’ payments. It can definitely have its benefits, but don’t buy that two-flat just yet.

Remember, with this arrangement, you’ll be swimming deep in the waters of landlordship. How it all pans out can be based on so many variables: the landlord, tenant, property, location, and a host of other factors can make this arrangement easy income or a nightmarish headache.

If things go wrong with your property, your tenant doesn’t share the burden of fixing things though they live there just the same. There can be costs associated with maintenance and repairs that go well beyond the monthly income your rented unit brings in. You’ll want to have a comfortable cash cushion for incidentals before starting your homeownership journey as a landlord.

Downsize

You don’t have to join the tiny home revolution to downsize (though it’s not a terrible idea). Downsizing can look different for different people. Downsizing for one person might be moving from the lake-view two-bedroom apartment to a studio in a less ritzy location. You’ll have to decide what downsizing looks like for you and if it will be worth the effort.

While you might not be game for all of these suggestions, you can probably adopt a few that could change your financial situation significantly. Whatever measures you choose to save or eliminate your housing costs, make sure you are ready to deal with the consequences. These consequences can be both beneficial and somewhat inconvenient for your quality of life and your financial health. In the end, you’ll have to determine if it’s worth it.

The post Clever Ways to Make Homeownership More Affordable appeared first on MagnifyMoney.

7 Monthly Bills Affected by Your Credit

A high credit score helps you in many ways, including by potentially lowering your monthly bills.

You probably know your monthly bills can impact your credit, as late payments or accounts in collections can land on your credit report and bring down your credit score. But are you aware your credit score can affect the payment amount on a number of your monthly bills?

Here are seven monthly bills with payments your credit score can determine.

1. Rent Payments

When you apply for a lease, your landlord might request a background check that includes your credit report. They can’t run a background check without your permission, although refusing may prevent you from moving forward with the lease.

According to the Federal Trade Commission (FTC), the landlord can take adverse action if they find red flags in your credit report. This action could include denying your rental application or raising your rent higher than they would charge another applicant. The good news is they are legally required to give you written notice if they take adverse action, provide you the report they used (if you request it within 60 days) and give you the chance to dispute the information.

2. Credit Cards

Consumers with good credit tend to qualify for much lower credit card interest rates than those with poor credit. Interest is applied to your credit card balance each month unless you pay it off in full within the monthly grace period. (You can go here to learn more about how credit card interest is calculated.) If you tend to carry a balance month to month, your poor credit could be costing you extra in interest.

3. Mortgages

Your mortgage payment is also directly affected by your credit. Mortgage lenders consider you a riskier borrower if you have a lower credit score. To hedge against that risk, they will charge you a higher interest rate.

4. Auto Loans

Credit scores impact the interest rate lenders offer when you apply for an auto loan. While interest rates vary between lenders, having excellent credit generally results in lower interest and a lower monthly payment. Those 0% financing offers you see on car commercials usually require excellent credit.

5. Student Loans

Your credit score doesn’t generally affect federal loan payments, but if you plan on financing your education through private loans, lenders can use your credit score to determine your interest rate and fees. The worse your credit, the more interest you’ll pay on the loan.

6. Auto Insurance

According to The Zebra’s State of Auto Insurance Report, there’s a correlation between credit and car insurance rates. On a national level, drivers with poor credit can pay more than twice as much as those with excellent credit for insurance. Some states have banned insurance providers from using credit scores to determine rates, but it’s a common practice in the states that allow it.

7. Homeowners Insurance

Insurance companies use credit-based insurance scores to determine what you’ll pay for homeowners insurance. These scores are industry-specific and aren’t exactly the same as your credit score, but they use the information in your credit report to determine your score. The same negative marks that bring down your credit score can impact your insurance score, and affect your payment.

Given your credit’s affect on nearly every bill in your mailbox (among other things, of course), it’s important to regularly monitor your credit for errors (you can go here to learn how to dispute those), identity theft or legitimate negative items that are affecting your score. You can pull your credit reports for free each year at AnnualCreditReport.com and view your free credit report snapshot every month on Credit.com. You can generally improve your bad credit by paying down high credit card balances, shoring up accounts in delinquency and limiting new credit inquiries while your credit score rebounds.

Trying to lower your monthly bills. We can help you get started with 9 ways to lower your monthly mortgage payment. 

Image: sturti

The post 7 Monthly Bills Affected by Your Credit appeared first on Credit.com.

9 Things to Do to Spring Clean Your Budget

While you're cleaning the house, make sure your budget is just as spotless.

Many of you probably have a spring-cleaning ritual. It is the time of the year when you wash the windows, air out the bedding and declutter. However, have you ever thought about sprucing up your budget?

That may sound strange, but it is the perfect time of year to take a good look at your finances. We’ve got some ideas of what to do to spring clean your budget.

1. Check Your Envelopes

Now would be a good time to make sure your cash envelopes (see how they work here) have the right amount in them. Take a look at your spending and determine if you need to make adjustments (up or down). Even if you don’t use cash, you should do this with your virtual envelope system as well.

You also need to make sure you don’t need to add new envelopes. Perhaps you find that you always go to your dining out envelope to get money for family fun. Why not make a separate envelope just for family fun? Now you have envelopes with a designated task and don’t need to take from one to fund another.

2. Clean Up Your Bills

Take a look at your spending. Are you paying for things you don’t need? Sometimes, we get so used to paying regular expenses that we ignore them.

For instance, you might not be ready to cut cable completely. However, are you paying for channels you really don’t watch? Go through your bills and make sure you aren’t wasting money on things you don’t use. (You can see seven easy ways to lower your cable bill here.)

3. Looking for Discounts

One of the goals of a budget is to help you keep as much money in your pocket as you can. Look back on your spending and you may discover you have items that could offer you a discount.

Believe it or not, there are many utilities that offer discounts to customers. You just have to know how to get them. You can take the time to research what others pay and call each company and try to negotiate your rates.

Once you make the phone calls, take additional steps to lower your utility costs. Your budget will thank you.

4. Establish New Goals

Goals are a tool we use in many areas of life, but what about budgeting? The truth is, you might already be setting goals and without realizing.

A goal could be as simple as paying down one credit card. It might be going on a dream vacation. Perhaps it is buying a car without a loan or paying for the first year of college tuition.

Whatever your goal, make sure you write it down. That instantly solidifies the goal. Then, you can place it somewhere you see it, every single day.

The more you see the goal, the more you remember what you want to achieve and hopefully avoid impulse purchases.

5. Lower Your Grocery Bill

This may seem like a strange one, but it can make a huge difference. It might mean shopping at a somewhere else.

For example, I slashed my grocery budget by switching to a difference store. By using this store to get most of our food, I dropped our grocery spending by more than $200 a month.

6. Transfer Your Credit Card Balance

This is the perfect time to look into getting a card with a 0% interest rate And transfer your balance to the new card. This will help eliminate interest on your balance, which might help you pay it down more quickly.

Just watch the introductory period. You need to pay the balance in full or transfer it again before the period lapses. Otherwise, you could end up paying even more in interest. (Interest rates are often based on creditworthiness — See two of your scores free on Credit.com.)

7. Lower Your Cellphone Bill

Most people think they are stuck paying whatever their wireless provider charges. That is true, for the most part.

However, you might be able to negotiate a lower rate. You may want to consider changing providers completely. Just call and see what happens.

8. Automate Your Savings

If saving money is difficult for you, you are not alone. Many people don’t have the discipline needed to save money every month. That is where automation helps.

You can see if your employer allows for your check to be directly deposited into multiple accounts. If so, have them deposit some of your paycheck directly into a savings account. If that is not an option, set up an automated transfer from your checking account into your savings account each month.

Once you do that, you will need to adjust the spending in your budget. Even saving just $25 a paycheck is better than nothing. You’ll be surprised at how much you do not miss the money.

9. Review Your Insurance

Take a look at not only your auto insurance but also your homeowners and life insurance.

Do some comparison shopping to make sure you are getting a good rate. If you get insurance from different providers, check to see if any of them offer any type of bundle discount. That might be reason enough to move all your coverage under one company.

If you’ve built up your emergency fund, you might be able to raise the deductible and lower your monthly out-of-pocket cost and save more than the deductible costs. Increasing your deductible from $500 to $1,000 could save you a lot of money in your monthly costs.

In addition, if you do not yet have life insurance, now is the time to consider purchasing it. It isn’t for you. It’s for your family. Read more about why you need life insurance.

Taking the time to review your budget is wise, but we don’t always take a close look. Plan to do this each year along with your spring-cleaning schedule and you’ll never forget again.

Image: DGLimages

The post 9 Things to Do to Spring Clean Your Budget appeared first on Credit.com.

How to Cut Sneaky Subscriptions and Recurring Expenses with Trim

 

It’s easy for small expenses to add up and burn straight through our cash. Especially since there are so many subscription and membership services available to sign up for that automatically bill accounts after a free trial.

Trim is a website that wants to help you identify and cancel these recurring costs to save money. You can connect your accounts to Trim, and it searches transactions for recurring payments to merchants that you can cut off.

According to Trim, the service has saved its users $8 million in sneaky expenses, so we’re putting it to the test. In this post, we’ll review the site to see what expenses Trim can identify.

We’ll discuss:

  • How Trim works
  • How much Trim costs
  • Pros and cons

How Trim Works

First, you need to go to asktrim.com to create an account. You can sign up for an account by email or through Facebook. For this review, I chose the email option.

 

Authenticating and setting up your account

After you input your email, first name, last name, and phone number, the website will send you a text message to confirm your phone number.

A confirmation of your phone number is necessary because the website corresponds with you via text message. You can also choose to receive messages from Trim through Facebook Messenger if you prefer. There currently isn’t a Trim app.

Trim needs to connect to your bank and/or credit card accounts to locate recurring subscriptions for cancellation.

Trim supports over 20,000 U.S. financial institutions. If you don’t see yours on the list, you can email Trim for support. Although I find tweeting a company usually gets a faster response.

The syncing of your financial accounts to Trim takes just a few seconds.

You’ll get a text message with the subscriptions Trim has found once the connection is complete. The identified recurring costs will also populate in your account dashboard on the website.

Here are a few of the subscriptions it found for me:

The dashboard breaks down your recurring charges into three different sections. There are subscriptions, utilities, and frequent charges.

Altogether, Trim found:

  • A car insurance payment
  • A Comcast bill
  • A banking account fee
  • Work-related expenses (Bluehost, Grammarly, and Freshbooks)

You’ll probably find like I did that not all charges found will be ones you can cancel or need to cancel. The purpose of Trim is to seek out any surprises.

How Trim cancels accounts

The cancellation aspect of Trim is what I consider the highlight because of how much of a pain it can be to terminate your subscriptions and memberships.

To cancel a service using Trim, you hit the red “Cancel this subscription” link on the website.

You can also message “Cancel (insert service)” to authorize cancellation from your phone.

Trim will contact the company by sending an email or calling. In some cases, like a gym membership, Trim may send out a certified letter.

I’ll be honest, I’ve moved from one city to another and completely forgot to cancel my gym membership before. This feature is one I can appreciate since gym memberships can be a huge hassle to cancel remotely.

Does Trim catch all recurring charges?

I went into this review with a pretty good grasp of the recurring charges that I pay. I was mostly curious to see how many of them the website algorithm would catch.

Trim found many of the biggies instantly.

But I was a little disappointed it didn’t catch items like my Hulu subscription through Apple iTunes.

The FAQ page states that Trim first identifies popular merchants like Netflix that use recurring payments. Then, it goes back through your bills monthly. The algorithm may pick up on other merchants after a few billing cycles.

I reached out to Trim via Twitter to see if there’s a reason Apple iTunes didn’t appear. I figured that would be one of the more popular merchants.

They got back to me the same day. It seems as though Apple charges can be hit or miss.

Extra Trim features

Trim has a few additional bells and whistles. You can review recent transactions of your financial accounts by merchant and category time.

Trim also offers other savings tools. For auto insurance, there’s a section on the site where you can type in your car’s make, model, and year to shop for cheaper insurance rates. You can also look for better Comcast deals through the account dashboard to potentially negotiate a better contract.

How Much It Costs

The Trim website is currently free to use. You’re probably wondering — what’s the catch?

Trim is really free. There are plans to roll out a paid financial advising component. But the basic Trim subscription review and cancellation service is supposed to remain free of cost.

Trim Security

According to Trim, the service uses Plaid security to connect to your financial institutions. This means Trim does not store the usernames and passwords used to access your financial accounts.

Instead, the credentials are sent through Plaid directly to your bank or credit card issuer to retrieve your transaction history. The transaction data Trim uses is read-only so that no changes can be made to your accounts. Trim also uses 256-bit SSL encryption for its own site and databases.

Pros and Cons

Now, for the pros and cons:

Pros:

  • The service is free.
  • Trim finds monthly recurring costs that you may have forgotten.
  • You can delete your Trim account at any time.
  • You can connect Trim to over 20,000 financial institutions.
  • You can correspond with Trim via messaging, which makes managing your account easy.
  • The Trim Twitter account responds quickly if you have questions.

Cons:

  • Trim may not pick up on all sneaky expenses right away.
  • Although there are security measures in place, connecting your financial accounts could be a deal-breaker if you’re extra cautious.
  • Ideally, you want to pay enough attention to your bank and credit card accounts to spot sneaky charges on your own. Trim is a nice shortcut to see if you’re missing anything, but for the long term, try to get into the habit of monitoring your statements.

The Final Verdict

Overall, Trim is an easy-to-use tool that can help you make sure there are no subscriptions from many moons ago still posting to your account.

However, Trim did not catch my iTunes Hulu membership initially, so I suggest you plan to keep your account open for at least a few months to give the algorithm time to identify money leaks.

The post How to Cut Sneaky Subscriptions and Recurring Expenses with Trim appeared first on MagnifyMoney.