13 Financial Tips for 2013

Here are Some Simple Ways to Improve Your Financial Life

ATLANTA, Jan. 7, 2013 (GLOBE NEWSWIRE) -- Everyone has made their New Year's resolutions and many people resolve to reduce or eliminate debt, start saving for retirement or simply get a better handle on where your money is going.

Mechel Glass, vice president of community outreach for CredAbility, offers 13 tips and tools for consumers that will help them take charge of their finances and improve their financial outlook:

Take Advantage of Low Interest Rates

The Federal Reserve has pledged to keep interest rates low for at least the next two years. Consider purchasing a home, refinancing your current home – particularly if have an adjustable rate mortgage – or buying a car. "While low interest rates mean lower returns on savings accounts, it also means lower rates on borrowing money," says Glass. "Consumers can take advantage of low rates to help them save money on planned purchases."

Raise Your 401(k) Contribution by 1%

As the economy improves, investment returns may improve. Instead of spending more money, consider investing an additional 1 percent of your income in your 401(k). For a person earning $50,000 annually, 1 percent is $500 – approximately $10 per week. Think about the amount of money you will earn over several years, as well as the tax benefits.

Improve Your Job Hunt by Checking Your Credit Report

As the economy improves, so will your chances to get a better job. Many employers are checking credit reports of prospective employees as another way to sift through qualified candidates. Make sure you know exactly what is on your credit report before an employer asks your permission to pull it. You can get a free credit report by going to www.annualcreditreport.com.

Nurture Your Credit Score

Paying your bills on time and paying more than the minimum amount will help improve your score. Even if you are not purchasing a car or a home in the near future, your credit score is being utilized to determine many things such as deposit for apartments, insurance, even when purchasing a new cell phone.

Track Every Dollar You Spend for 30 Days

If you don't have money left at the end of each pay period, or you can't save money, it's time to start tracking it.  For just 30 days, write down every penny you spend. Review this list for expenses that can be reduced or eliminated. Small changes can add up to big savings and can help you reach your goals more quickly.  To help you track your expenses, click on http://www.credability.org/en/tools/financial-calculators.aspx and use our budget calculator.  For iPhone users download our free Pocket Tracker app at https://itunes.apple.com/us/app/pocket-tracker/id557566328?mt=8

Tuck Away Those Savings in a CD or IRA.

Don't scrape by each month and fritter it away the next month. Take your savings from the 30 days of scrimping and open a CD or an IRA.  Putting the money in a regular online savings account won't work; it's too easy to reach in an emergency.

Ask for lower rates

You can reduce your auto insurance costs, cable bills, cell phone and credit card bills with a simple phone call. Do some comparison shopping on auto insurance rates and call your carrier to see how you might reduce premiums. Your cable company may be able to lower your monthly bill or offer you a special promotion for a period of time that can result in savings.

Save $10 A Week

Even if you think you are living paycheck to paycheck, it is possible for you to save money. You can save as little as $10 each week just by making simple changes. Here are five ways to save $10 or more:

  1. Eliminate your land line phone. If you only use your cell phone, consider turning off your landline or at least reducing your services to the bare minimum.
  2. Have coffee at home. Skipping your morning coffee out can add up quickly.
  3. Bring your lunch and snacks. Limit lunch out to once or twice a week.
  4. Skip the lottery tickets. You will be better served to put that money in a savings account.
  5. Avoid unnecessary trips and carpool when possible. Gas prices are on the rise, and sharing commuting costs can add up to big savings.

Fully Fund Your Emergency Savings Account

When you need new tires, your washer stops working or you need a new furnace, you don't want to borrow money.  Keep at least three months of cash in a savings account to cover emergency living expenses.

Every Once in a While, Use a Credit Card

To avoid a reduction in your credit line, or having your credit cards canceled, pay a small expense with a credit card every 30-60 days. Then, pay off the credit card bill when it arrives.

Plan Your Future – Set Goals and Save for Them

Make a plan by setting specific, attainable goals. Once you set your goal, write it down. Your goal may be to pay off credit card debt, reduce monthly expenses, start a college or retirement fund, or save for a family vacation. Your goal should be something important to you that you are willing to work toward.

Get a handle on what you owe

Understanding exactly how much you owe is an important first step in tackling debt. Write down the balances on every credit card and total it. Once you know how much you owe, you can take realistic steps to reducing and eliminating balances.

Get back to the basics

Simplify your lifestyle and live within your means. Know the difference between your wants and needs, and make daily choices that help you stay on track. If you want new clothes every week or new electronic games, make sure those funds are in your budget. If it's a struggle to pay for those items or you put those purchases on credit cards that are not being paid off at the end of the month, you may have a problem.

Don't be afraid to ask for help

The key to improving your financial outlook is taking action. If you're not sure where to start, there is a place to turn. At CredAbility, certified counselors will help you evaluate your financial situation and find the solution that best suits you. For more information on Debt Management Plans or to talk with a certified counselor about your options for a debt free life, contact CredAbility at 1-800-251-2227 or online at www.CredAbility.org.

About CredAbility

Founded in 1964, CredAbility is one of the leading nonprofit credit counseling and education agencies in the United States, serving clients in all 50 states plus the District of Columbia, Guam, Puerto Rico and the U.S. Virgin Islands, in both English and Spanish. In addition, we provide in-person counseling at offices in five states in the southeast. Service is provided 24/7 by phone at 800.251.2227 and online at www.CredAbility.org.

The CredAbility logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=11910


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