Author: Courtney Jespersen

Reboot Your Budget to Prepare for Reopening

Posted on by Courtney Jespersen

Picture cruising your car deep into 2021 and never glancing in the rearview mirror. Vaccines, travel and a hope of normalcy are finally on the horizon.

With so much to look forward to in the future, it’s understandable to not want to look back.

But returning to typical day-to-day life will be a transition. And from a financial standpoint, you’ll want to assess your past budgeting behavior to prepare for more normal days ahead.

Review past and current spending

Last year’s spending didn’t look like 2019. And 2021 won’t look like either 2020 or 2019. But you’ll need this historical insight to inform your future spending, especially as you start reintroducing expenses that used to be ordinary, like concert tickets, plane tickets and so forth.

Some people’s spending decreased dramatically last year (either from necessity or choice). But others faced comparable expenses, says Molly Laughter, certified financial planner and founder of Laughter Financial LLC in Dallas.

Remember that jungle gym for the kids to play on in the backyard? Or the Xbox for long nights of playing video games? They may have been great ways to keep you occupied and comfortable at home, but now you’ll need to find a way to balance these newer expenses with your past spending on the activities you hope to return to.

Since many of us are already taking a close look at our finances right now as we file taxes, Laughter suggests using this opportunity to review year-end financial summaries from your credit cards and bank accounts.

Size up each category. How much did you spend? Was it worth that amount? Would you want to continue spending that much?

Play favorites

Ever since COVID-19 became part of our vocabulary, there’s been talk that life would never return to normal. Laughter anticipates your future spending will be a “new normal.” Sure, you may introduce dinners out — and possibly even a trip — to the mix, but expect to continue paying for quarantine life staples like deliveries and at-home activities.

According to Vid Ponnapalli, CFP and owner of Unique Financial Advisors based in Holmdel, New Jersey, “There is going to be a paradigm shift with respect to how budgeting in the future will be compared to how it was pre-COVID.”

This new balance means you’ll need to play favorites with your finances. After all, you can’t keep up the amount you’ve been dropping on at-home entertainment and food deliveries while also upping the amount you spend on indoor dining and live shows. It just won’t all fit in the budget. Select the expenses you benefit from most.

To make the necessary adjustments, Laughter suggests looking at the big picture. Don’t get too caught up in specific line items. (For example, if you’re spending 25% less on grocery orders, you don’t have to redirect that exact amount to dinners out.)

Instead, once your needs and savings are accounted for, set a dollar figure you can afford each month for discretionary expenses, then spend it on whatever you want. You may never add back in some things you used to spend money on.

As Ponnapalli says, we’ve all figured out new ways to spend less money and still have fun. Dropping thousands of dollars on concert tickets may not feel worth it anymore when you compare it with watching a (much cheaper) livestream at home.

Plan for future goals

Life hasn’t returned to normal by any means. But for many Americans, the prospect of getting a vaccine is mere weeks or months away. Use the time between now and then to prepare for what’s to come.

Laughter says to think of it like advance notice. “The vaccines aren’t getting out as quickly as we’d like,” she says. “So start your clock.” Begin setting aside a certain amount monthly to accomplish a goal when it’s all said and done.

For example, if you want to travel again by a certain date, use the next few months to funnel funds into a designated savings account. If your student loan payment is on hold, make a plan for how you’ll strategically spend those extra funds in the meantime. And prepare for that added bill when it’s reintroduced.

Whatever financial decisions you make, remember, whether we’re in a pandemic or not, the fundamentals of finances don’t go away. Spread your money between things you need, things you want and savings.

Your allocations may change, but “the name of the game is the same as it was before — budgeting, budgeting, budgeting,” Ponnapalli says.

Here’s to better days and better budgets ahead.

This article was written by NerdWallet and was originally published by The Associated Press.

Courtney Jespersen writes for NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article Reboot Your Budget to Prepare for Reopening originally appeared on NerdWallet.

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Turn Your Quarantine Clutter Into Money

Posted on by Courtney Jespersen

I placed more online orders than I can count in 2020. And I justified all of them.

My front porch was filled with boxes containing all sorts of things: furniture (I needed to redecorate), paper towels (I needed to stock up), crafts (I needed activities), board games (more activities) and a treadmill (I needed exercise).

But if I’m being honest, I bought a little too much.

Take a look around your place. If your quarantine habits were even a tiny bit like mine, you could turn that clutter into money. Here’s how.

Too much stuff? Sell it

Perhaps you purchased more than you ended up using, like board games or video games. Or maybe you bought new products to replace old items and were left with a drawer of discarded technology.

Whatever the case, you have more than you need. And there are lots of places to sell your stuff online.

Chelsea Lipford Wolf, co-host of the “Today’s Homeowner” TV show and host of the “Checking In With Chelsea” web series, says she made over $1,000 selling things online during the last six months of 2020 through Facebook Marketplace, an outlet for buying and selling locally.

You can, too. Look online for this or another marketplace that suits your needs. For example, Facebook Marketplace caters to local transactions, while other sites focus on product categories like tech or apparel. Read the directions to see how the site works and check for customer reviews or a Better Business Bureau accreditation before committing. Make an account, then get to work.

You can sell almost anything online — technology, furniture, clothing, video games and toys, to name a few.

Here are Wolf’s keys to making things sell:

  • Presentation. “You want the item you’re selling to be the focal point of your photo,” Wolf says. Clean it first, then take flattering photos in natural sunlight, preferably near a window. Get multiple angles.
  • Price. Consider what someone might pay for the item, then price it slightly lower to make it move. You can also check listings posted by other users to determine the going rate.
  • Particulars. Spell out everything in the description, including the brand and any imperfections. A more detailed listing means less back and forth with potential buyers. As the saying goes, “Time is money,” Wolf says.

Too much work? Consign

Depending on which site you use, you’ll have to write listings, package your items and send them either directly to the buyer or to the platform you used to make the sale. In some cases, you can deliver in person.

To save time and effort, take your stuff to a local consignment store instead. You’ll likely make less, but the store does the selling for you. Expect to pocket half of the selling price, Wolf says.

Other options? Give things away to family and friends. Donate to a local charity. And throw away items that have absolutely no use.

Too many temptations? Scale back

Once you’ve sold and donated what you can, fight the urge to impulse shop again. Keeping up your current habits could get you right back to where you started. One way to avoid that? Save first and buy later.

This approach is the exact opposite of putting something on a credit card and paying it off after the fact, says Pam Horack, a certified financial planner and the owner of Pathfinder Planning LLC, based in Lake Wylie, South Carolina.

Save money and wait to place an order until you can afford it in full. Horack says her family has a designated clothing account. When someone needs a new pair of shoes, the money comes from what they’ve set aside.

You can do the same with a general spending account. “If you don’t have money in that account, then you can’t buy it,” Horack says. “That needs to be your rule.”

There are also ways to stay busy without spending much, if any, money. Here are some of Horack’s ideas: Redecorate your house by moving around your furniture. Spend time outdoors. Finish up projects around the house. You’ll spend less and accumulate less stuff.

Too expensive? Buy used

But you can’t stop shopping altogether. For things you absolutely need, consider buying on the same websites you used to make extra money.

When you list products, you won’t sell them for as much as you originally paid for them. That means you can purchase things at a significant discount, too.

Consumers have been buying and selling used during the pandemic, according to Sara Beane, media relations specialist at technology marketplace Swappa. “Everybody is kind of strapped during this unprecedented time,” Beane says.

For example, the site saw a rush on laptops around back-to-school season.

Search used marketplaces by model and condition of the item. You’ll find many price points to fit your budget.

But before you hit the “buy” button, do some organizing, Wolf says.

“If you have so much stuff that you can’t see what you have, then you’re going to buy more than you need.”

This article was written by NerdWallet and was originally published by The Associated Press.

Courtney Jespersen writes for NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article Turn Your Quarantine Clutter Into Money originally appeared on NerdWallet.

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The Case for Shopping on Black Friday in 2020

Posted on by Courtney Jespersen

Like most things in 2020, Black Friday won’t be the same this year.

But at least in the case of holiday shopping, change might not necessarily be a bad thing.

If you’re thinking about shopping on the day after Thanksgiving, here’s why you should — and at least one reason you shouldn’t.

The day still holds meaning

Retailers kicked off Black Friday sales back in mid-October to coincide with Amazon’s Prime Day. There’s been an onslaught of discounts ever since.

But no matter how many sales retailers label throughout the year as “Black Friday” discounts, there’s still something special about the day itself. This year, it falls on Nov. 27.

The day after Thanksgiving is a “designated consumer shopping day,” says Tom Arnold, professor of finance at the University of Richmond in Virginia.

That’s why retailers continue to market it and offer savings. Based on prior years, there will still be something special left, even after all of the early deals.

Retailers typically hold on to some fresh deals to release over Thanksgiving weekend, according to Katherine Cullen, senior director for industry and consumer insights at the National Retail Federation. She recommends acting on early deals this holiday season if you see a price you like though.

Official Black Friday deals often start on Thanksgiving Day and last into the weekend. They’ll be followed by Cyber Monday sales on Nov. 30.

You can save money

These sales make Black Friday shopping a fun family tradition. But it’s also a great way to save cold, hard cash.

In fact, that could make the discount bonanza even more attractive this year, according to Christopher Newman, associate professor of marketing at the University of Mississippi.

“It may be especially popular this year since many consumers are feeling financial strain due to economic and employment problems caused by COVID-19,” Newman said in an email. “Many consumers will likely not be in the financial position to pass up the price savings afforded by Black Friday.”

Cullen says wellness, personal care and comfort items as well as those for the home have been “popping” during the pandemic as consumer demand has increased. Hobbies like baking and holiday traditions like wearing matching pajamas are also popular.

You can likely expect retailers to discount products that appeal to pandemic conditions. Best Buy’s early Black Friday deals included markdowns on laptops and wireless headphones. Target slashed prices on things like video games and toys.

In-store shopping is so 2019

In an effort to promote safety in the pandemic, most stores are closing on Thanksgiving this year. They’re also bringing sales online — a move that’s both convenient and cost-effective for Black Friday shoppers.

“We’ve heard retailers saying, ‘We’re probably going to offer the same deals both online and in store on Black Friday so that people can shop in the way that’s most comfortable and safest for them,’” Cullen says.

That means many retailers won’t be enticing customers to brave the crowds for in-store-only doorbusters, she adds. That’s welcome news for consumers.

“Many shoppers will still feel uncomfortable going to brick-and-mortar retail stores, and many state and local governments are still imposing reduced capacity limits inside stores,” Newman said.

Aside from the safety and convenience of not having to leave home, Arnold suspects this head-to-head online competition will also be a monetary win for shoppers.

“I think the consumer is going to benefit because now it’s going to be a lot easier to compare prices with the competition online,” Arnold says.

In the past, he says, retailers could lure shoppers into stores, and consumers would often buy the products, even if they were listed online for a slightly better price. That’s because at a physical store, you have the item with you and don’t have to worry about shipping delays — even if you pay a little more for it.

But exercise restraint

As in the past, for every impressive Black Friday deal you see, there’s likely another deal that’s less worthwhile. Set a budget ahead of time so you know exactly what you’re looking to purchase and how much you’re comfortable spending.

Be cautious about your health, too. Look into a store’s safety protocols to see if you’ll feel safe being in a physical store. If you won’t, many retailers allow you to buy online and pick up curbside, Cullen points out.

And if you’ve already shopped more than enough this holiday season during the impressive early sales, it’s fair to say you can sit out Black Friday to avoid overspending.

This article was written by NerdWallet and was originally published by The Associated Press. 

Courtney Jespersen is a writer at NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article The Case for Shopping on Black Friday in 2020 originally appeared on NerdWallet.

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What to Buy (and Skip) on Black Friday 2020

Posted on by Courtney Jespersen

Amid all of the retail chaos and change of 2020, at least one thing remains the same: the biggest sale day of the year.

Black Friday — the day after Thanksgiving — has a reputation as the best time of the year to buy just about anything.

But even though Black Friday still exists in 2020, it won’t be the same experience as before. Our guide can help you get the best bargains this Nov. 27.

Buy: Televisions

Low-priced electronics deals are a given on Black Friday. That won’t change this year.

Last year, Target sold a 65-inch TV in stores for only $279.99. Walmart, too, had a 65-inch TV for just $278. This Black Friday, you’re guaranteed to find discounts on TVs, as well as tablets and laptops.

As for some stocking stuffers to go along with your new TV, you’ll find video games, CDs, DVDs and Blu-rays deeply discounted from their original prices. In 2019, Walmart had over 50 movie titles for $1.96 apiece.

Skip: Toys

Historically, it’s best to wait until closer to Christmas to purchase dolls, action figures, play sets and other toys. You run the risk that certain items will sell out, but you may also be able to find bigger savings on what’s left.

In past years, select toys have been on sale for as much as 50% off in the final days before Christmas.

Buy: Apple products

There’s a specific electronic brand that’s popular on Black Friday: Apple. Major retail stores such as Best Buy, Target and Walmart discount Apple products each year, and previous-generation models usually see dramatic deals. These offers may include price cuts, free gift cards with purchase (up to $400 with a qualifying phone purchase on an installment plan), or a combination of both.

Target devoted an entire page of its 2019 Black Friday ad to Apple. The Apple Watch Series 3 (GPS) started at $169.99 (regularly $199.99), and select App Store and iTunes gift cards were buy one, get one 30% off.

Apple discounts likely won’t disappear this Black Friday. In fact, Apple items have already been on sale in pre-Black Friday sales. Keep an eye out for deals on MacBooks, iMacs, iPhones, iPads, Apple Watches and Apple TVs.

Skip: Bedding

You’ve got the entertainment center covered, but hesitate before stocking up on supplies to refresh the look of your bedroom this Black Friday.

Every January, retailers such as Overstock, Pottery Barn and Sears host “white sales.” During these seasonal promotions, discounts on bedding, pillows, towels and linens can hit up to 70%. Expect these to come around after Jan. 1.

Buy: Gaming systems

Black Friday is big for gamers. This year, look for savings on video game systems from retailers such as Best Buy, Walmart and GameStop. Expect deals on products from Xbox, PlayStation and Nintendo.

You’ll also find particularly great offers on gaming bundles. These include the game console plus a combination of accessories or games.

Skip: Winter clothing

Winter clothing generally isn’t the best value on Black Friday. Retailers frequently offer big clearance sales on jackets when winter gives way to spring.

But if you need something to keep you warm before then, you’ll be able to find some bargains this Black Friday. Year after year, department stores like to offer doorbuster deals on women’s boots with select pairs for just $19.99 each.

If you miss Black Friday, don’t worry. Department stores and clothing retailers have been rolling out new sales almost daily.

Buy: Christmas decor

Blowout post-Christmas clearance sales happen every year on Dec. 26 as shoppers make their way to the store to return gifts. Christmas decorations, wrapping paper, tinsel and other seasonal trimmings reach super low prices (for obvious reasons). Prices also drop in the final weeks before Christmas.

For those reasons, Christmas decorations used to be on our list of items to skip on Black Friday. But this year, it’s less likely you’ll be at the mall shortly before Christmas. And waiting to order online could spell shipping delays.

So if you need decorations, consider scooping up deals on artificial trees and rolls of wrapping paper from home and craft stores on Black Friday. That way you’ll have your essentials in time for Christmas.

Skip: Outdoor items

Outdoor products, grills and patio furniture were already deeply discounted immediately after summer ended.

If you didn’t pick up these products at the close of this summer, wait until Memorial Day and Labor Day sales roll around next year. Another viable option is the Spring Black Friday Sale that home improvement store Lowe’s usually holds each year.

Buy: Appliances

Black Friday brings big savings on washers, dryers, refrigerators and other kitchen appliances. Retailers typically mark down home appliances by 40%. Look for similar deep discounts again this year.

You’ll find smaller appliances such as coffee makers, mixers, blenders or vacuum cleaners on sale, too. Expect deals from department stores such as Kohl’s, Macy’s and JCPenney.

Shop: Online

For the ultimate combination of convenience, safety and savings, spring for online shopping. With so many stores closed on Thanksgiving, big-box retailers are bringing their doorbusters online this Thanksgiving and Black Friday.

Online shoppers will usually enjoy free shipping. Or, you can choose to make your purchases online and pick them up at the store.

Courtney Jespersen is a writer at NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article What to Buy (and Skip) on Black Friday 2020 originally appeared on NerdWallet.

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How to Renegotiate Your Bills to Save Money

Posted on by Courtney Jespersen

I know, I know. You’ve probably heard all about how you should renegotiate your bills to save money. But that’s easier said than done, right?

That’s why I tried it out. I called up some of my service providers and attempted to cut the cost of my bills.

Here’s how you can learn from my successes — and improve upon my failures. (Spoiler alert: Be prepared to make sacrifices.)

Formulate a game plan

It’s a good idea to call up your service providers and subscription services annually to negotiate a better rate, ask about new promotions or cancel unnecessary bills. This is a powerful tool to save money.

These tactics can be used for securing a better deal on cable, internet, subscription services and more.

First, review all of your recurring payments by identifying charges on your credit card and bank account. Then, decide if you really want (or need) those anymore.

Make a list of the bills you would like to lower or cut out entirely. On my list: Satellite radio, cable, a clothing subscription and a movie loyalty program.

Next, look up each company’s website. You’ll usually find a variety of contact methods, including live chat, text messaging, email and a phone number.

While you’re searching online, gather information about your current package and pricing, as well as any new promotions from your current company or competitors that can be used as leverage.

Cut out what you don’t need

Set aside a block of time — maybe an hour or so — and work your way through the list.

My first call was to our satellite radio service provider. My husband and I have a SiriusXM subscription. But after months of spotty reception in our car, I decided it was time to cut the service completely.

Instead, over the course of a 10-minute phone call, I asked to cancel, then I was met with a better offer. Before, we paid $20.63 per month. Now, we pay $6.06 a month for 12 months (for the same plan). Plus, they threw in a free month.

Threatening to cancel a service can be a bargaining tactic. Here, it was the truth — I was fully ready and willing to cancel. And it got me a better price.

Next? That clothing subscription. A five-minute online chat with athletic brand Fabletics resulted in me canceling my membership. Before, I paid $49.95 a month as an account credit, unless I logged into my account and shopped or skipped by the fifth day of the month.

The customer service representative offered a $10 store credit to stay, but I went ahead and canceled anyway.

Downgrade

Be patient. There’s a time commitment involved. Plus, things don’t always work out.

I spent 45 minutes online chatting, then talking on the phone with DirecTV. But even after consulting with two representatives, my monthly payment remained around $150 before and after my interaction.

I was told there weren’t any discounts or promotions currently available for my account. And since I didn’t want to downgrade my package (I’m not ready to give up those Lifetime movies on LMN or game shows on Game Show Network), I’ll have to wait for future offers.

If you’re willing to change your TV lineup, review available channel packages online to find a slimmed-down option that works for you. Or call and talk to a representative.

Ask for help

Renegotiating bills is perhaps more important now, especially for those who are dealing with financial impacts related to the coronavirus. As the pandemic began taking an economic toll in the spring, providers across a broad spectrum of industries stepped up to extend payment assistance and waive late fees for customers.

I contacted some service providers to see how they’re continuing to help consumers who are struggling.

Most telecommunications companies, such as Dish and Comcast, provided similar advice: If existing customers have questions or are interested in lower monthly payments, they should go online or call customer service.

Contact companies proactively, and if you’ve been laid off or otherwise affected by the pandemic, be honest about your situation.

Look for resources that don’t require any effort, too. I thought I might need to cancel or renegotiate my $15-a-year AMC Stubs Premiere movie theater loyalty account. But the company had already temporarily paused my account in light of movie theater closures.

Renegotiating bills didn’t save me enough money to retire early. But I’ll manage to hold onto almost $200 over the next 12 months  — which is more than if I hadn’t picked up the phone.

This article was written by NerdWallet and was originally published by The Associated Press. 

Courtney Jespersen is a writer at NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article How to Renegotiate Your Bills to Save Money originally appeared on NerdWallet.

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Financial Lessons We’ve Learned While Staying at Home

Posted on by Courtney Jespersen

Shelter in place. Lockdown. Quarantine.

Whatever you call it, it’s been a few months since the COVID-19 pandemic taught us what staying home for an extended period of time actually looks and feels like.

These are unprecedented times. And although things are unpredictable right now, we can control our ability to emerge from this challenge differently than we entered it.

“Like everything in life, every challenge and every hardship is a lesson to be learned,” says Eric Simonson, certified financial planner and owner of Abundo Wealth, based in Minneapolis.

Some of these takeaways are spiritual, emotional, mental or physical. And some are financial.

Here are three pieces of money advice you can apply to your bank account, budget and lifestyle as life evolves after lockdown.

Insulate against an emergency

Financial experts believe this pandemic has illuminated the pressing need for emergency funds and cash reserves.

“Financial advisors for years, I think, with a lot of people, could talk until they’re blue in the face about why an emergency fund is a good idea,” says Kevin Mahoney, CFP, founder of Illumint, a virtual financial firm based in Washington, D.C.

“But for people who were fortunate to have not actually experienced an unexpected medical event, a long-term job loss, whatever it might be, it can be hard to really convince people that this is a top priority for their money.”

Now, job losses, furloughs and medical emergencies have provided a tangible example of why these funds are so important.

The general rule of thumb for an emergency fund is to have three to six months’ worth of living expenses saved. That may or may not be enough, depending on the circumstances. If you’re able, save something now. Even $500 is a good start.

Prepare (don’t panic)

Emergency readiness will likely also extend to home pantries. For better or worse, when frenzy sets in, consumers begin panic shopping. Americans have seen the repercussions of that firsthand — disinfecting wipes are still difficult to come by.

Forward-thinking consumers will likely begin to accumulate a reasonable amount of essential supplies or stock an emergency kit in case they’re ever again unable to leave the house for an extended period of time.

“Consumers will adopt a mindset of ‘sufficient stockpiling’ as their awareness of life’s uncertainties has been magnified due to COVID-19,” Ross Steinman, professor of consumer psychology at Widener University in Pennsylvania, said in an email.

While there’s no need to hoard, it may be beneficial to prepare in case other people once again panic shop for food and essentials at the onset of future emergencies.

You may want to employ savvy shopping strategies for those necessary items that you’ll continue to buy. That may include purchasing bulk quantities at a lower price per unit, using products more sparingly or applying online coupons in an attempt to save money.

“During COVID-19, many consumers lost their primary source of income, or had it drastically reduced,” Steinman said. “As a result, individuals will be aggressively searching for discounts and promotions.”

Shift your spending

Monthly expenses will likely also look different moving forward. Mahoney believes the stay-at-home orders have acted as a budget reset for many.

“It’s hard to press pause on spending habits that you’ve had for many years,” Mahoney says.

But for months now, most people have been left with no choice other than to stop traveling, dining out, attending concerts and going to the movie theater. Budgets have therefore skipped over expenses that used to be recurring.

Some of these new routines might stick even when life regains some sense of normalcy. (Maybe you actually like those PB&J sandwiches at home. Or, maybe you’ll continue watching movies at home instead of in the theater.) If these do stick, it’s possible you’ll spend less discretionary money in the months ahead than you did before the pandemic began.

Through all three of these lessons, it’s clear living through a pandemic has served as an impetus to raise awareness about financial preparedness.

“A lot of my clients are now way more interested in budgeting and knowing where all of their dollars are being spent than they used to be,” Simonson says. “I think that will continue.”

This article was written by NerdWallet and was originally published by The Associated Press.

Courtney Jespersen is a writer at NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article Financial Lessons We’ve Learned While Staying at Home originally appeared on NerdWallet.

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Can’t Make Money Right Now? Free Up Cash in Your Budget

Posted on by Courtney Jespersen

You’re not the only one with a tight budget. Millions of Americans are currently struggling with unemployment, lost hours and lowered wages.

There’s little comfort in knowing that others are feeling strapped. But you may be relieved to hear there are ways to make things easier — even if you’re out of work or can’t make more money.

We talked to financial experts for advice about getting more mileage out of the money you have available right now. Here are their tips for finding extra money in your monthly budget.

Go line by line

Depending on where you live, you’re probably spending a lot of time at home these days. Devote at least some of the free time to analyzing your finances.

Go over every single transaction in your checking account, savings account, credit card bills and so forth, says Robinson Crawford, certified financial planner and founder of the adviser firm Montebello Avenue in Phoenix.

Crawford says you can use a budgeting system to make this step easier. Try an app, Excel file or some other tool.

Once you see all of the dollars going in and out, you’ll be able to identify areas for savings. And you’ll be ready to start making some (or all) of the changes outlined below.

Pick up the phone

As you look at your line items, focus on the largest bills first, suggests Cady North, CFP, founder of North Financial Advisors LLC, with offices in San Diego and Washington, D.C.

Lowering substantial, recurring payments has the potential to reap the biggest savings. For example, even if you already received an automatic rebate from your auto insurance company, it doesn’t hurt to call up and see if you can negotiate additional savings. That’s particularly applicable if you’re not driving right now.

Another option? If you have student loans, your federal student loan payment has likely already been suspended, but you’ll want to take the extra step to ensure you’ve stopped your automatic payments. That is, if you don’t want to continue making payments right now.

If you choose to contact companies and service providers you do business with, be honest about how COVID-19 has affected you. Crawford recommends telling them about your situation and why you’re asking for help, especially if you’ve been laid off. They’re likely to empathize.

“Part of the reasoning should be, ‘Listen I’m trying to do everything to keep all of my bills paid. I want your service. I want to keep you. I want to stay as a customer.’”

Unplug and unsubscribe

After the big expenses, seal smaller holes in your spending. Try looking around your house, recommends Shehara L. Wooten, CFP, founder of investment advisor Your Story Financial LLC.

Unplug electronics when they’re not in use. Stop buying disposable paper towels and paper plates — switch to reusable towels and plates instead. Monitor the thermostat and lights as you spend increased amounts of time at home.

You can also pull the plug on unnecessary subscriptions. Crawford says now might be the right time to cancel those streaming services and online shopping memberships, especially ones you haven’t found use for even while you’ve been cooped up at home.

“If you’re not watching one of your streaming subscriptions during COVID, news flash: You’re never going to watch it.”

If you still like (and use) your subscriptions and aren’t willing to give them up completely, cut them out temporarily. Some companies allow you to go online and pause your account for a period of time.

“That’s a way to get $15, $20 here and there extra in your budget,” North says.

Get money back

Finally, while you may not be able to find a new job right now, there could still be methods to expand your budget that you hadn’t considered.

One way is to sign up for cash-back shopping sites or apps to earn money back when you purchase groceries and other essentials, Wooten points out. With some apps, you scan your receipt after a transaction for post-purchase savings.

As you free up money, make sure you’re devoting those newfound funds to absolute necessities first, like food and shelter.

Every change you can make — no matter how major or minor — can make a difference.

This article was written by NerdWallet and was originally published by The Associated Press.

Courtney Jespersen is a writer at NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article Can’t Make Money Right Now? Free Up Cash in Your Budget originally appeared on NerdWallet.

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Scaling Back Spending Yields Unexpected Benefits

Posted on by Courtney Jespersen

When I originally set out to write this column, I wanted to share the unexpected benefits of cutting back on my online shopping habit.

At the beginning of the year, I set a personal challenge to reduce my online orders from several times a week (insert embarrassed emoji) to a few times a month. As time passed, I realized I had fewer deliveries to track and more money left in my bank account at the end of the month.

But then COVID-19 happened. And now eliminating online shopping is more than a fad or a New Year’s resolution. For millions, cutting things out of the budget is an absolute necessity.

If you’re having to scale back on discretionary spending — whether that’s shopping, travel or something else entirely — here’s how to give up that financial habit without feeling deprived.

See the silver lining

The news is filled with fear, worry and sadness. But it helps to see the silver lining, says Denise Downey, a certified financial planner and owner of Financial Trex LLC, based in Spokane, Washington.

Depending on where you live, you may be forced to stop some spending — on travel, sporting events, haircuts, entertainment and more. This involuntary saving can help you make changes you wouldn’t have otherwise made on your own.

“Those decisions are being made for us right now,” Downey says. “It’s not a matter of, ‘Do I cut the vacation this year or not?’ It’s cut. There’s no decision to be made with that.”

“If you want to put a positive spin on it, it’s making it easier for people to cut their expenses because they’re removing that decision-making hurdle.”

It’s all about perspective. So, if you can, focus on the benefits. For instance, you may find you’re feeling a positive boost as you watch your bank account grow and your credit card bill stop climbing.

So sure, my deliveries of clothing, makeup and the newest scented candles aren’t as frequent. But much like the thrill of getting a delivery, I’m finding that not spending is also appealing.

Get your power back

It’s probably obvious that placing fewer online orders equates to saving more money, as long as you don’t substitute an expensive activity in its place. The same goes for other types of spending. Cutting back any spending habit can lead to savings.

It can also give you a sense of empowerment, says Drew Harris, CFP, senior financial advisor at Greenway Wealth Advisors LLC, based in Charlotte, North Carolina.

“It’s a good way to gain back some control by taking ownership of our spending,” Harris says.

Cutting back means you’re giving something up. But you’re also gaining freedom from the financial stress that discretionary spending can cause, as well as the buyer’s remorse that so often accompanies spending.

This sense of empowerment can help you feel better. L. Kevin Chapman, a licensed clinical psychologist, says you may “adopt a sense of mastery when eliminating something that has led to financial strain.”

Basically, you’ll feel a sense of accomplishment, which allows you to feel positive (rather than negative) about the changes you’re making.

Learn a new habit

Don’t get discouraged. Your decreased spending won’t have to last forever.

But then again, you may find you don’t necessarily want to return to your pre-pandemic spending habits. And that’s OK, too.

Chapman says many people will become more accustomed to shopping less following the COVID-19 outbreak, especially if they’ve replaced their shopping habit with more cost-effective activities.

Take this time to learn some new habits in place of your old costly ones. Harris suggests going for a walk, talking with family and friends or finding some other inexpensive activity you enjoy doing.

Another example? Downey says her children were constantly busy with extracurricular activities — activities that cost money. But since the family has been home, she’s noticed they’re happy and entertained, even with a not-so-busy schedule. That has led her to rethink enrolling them in quite as many activities in the future.

Regardless of the specific substitutions you make, the changes you’re implementing during these unprecedented times will help boost your savings and emergency fund. Best case scenario, when life returns to some degree of normalcy one day, hopefully that fund is more than you ended up needing, Downey says.

In that case, you can reward yourself by buying something you’re putting off right now — and paying for it in cash.

This article was written by NerdWallet and was originally published by The Associated Press.

Courtney Jespersen is a writer at NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article Scaling Back Spending Yields Unexpected Benefits originally appeared on NerdWallet.

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Make Your Brand Loyalty Pay Off

Posted on by Courtney Jespersen

Blogger Dani Austin of Dallas, Texas, logged into her Southwest Airlines account a few days before the end of 2019.

Shortly after, she and her husband, Jordan Joseph Ramirez, flew to Las Vegas (and back home) in less than 72 hours.

The spontaneous trip was part of a last-ditch attempt to try to earn the Southwest Companion Pass, a benefit of the Southwest Rapid Rewards program that allows pass holders to bring one companion on flights for at least a full calendar year free of airline charges (not including taxes and fees).

But consumers jump through hoops for more than airline rewards.

My brother-in-law is a die-hard shopper at American Eagle Outfitters. He recently purchased a jacket and jeans from the clothing store for just $2.69.

He’s no extreme couponer, but he leveraged his loyalty arsenal: his store credit card, AEO Connected Rewards account and a coupon.

So what’s the secret? When consumers are devoted to a particular brand, they can cash in.

What’s in a rewards program?

Rewards, or loyalty, programs favor repeat customers. That often takes the form of discounts, coupons or free products. Consumers generally create an account and earn points or perks after making purchases.

The more you spend or the more points you rack up, the greater your payoff.

While saving money may be the obvious benefit, status is also an important draw, whether it’s sitting at the front or standing in a special VIP line.

These structured programs often include experiential rewards, according to Emily Rugaber, head of marketing at Thanx, a digital engagement platform. At a restaurant, that may equate to skipping the wait or tasting a special menu item first.

“It feels good to be treated differently,” says Jonah Berger, a marketing professor at the Wharton School at the University of Pennsylvania and author of “Contagious: Why Things Catch On.”

What’s in it for retailers?

Retailers are banking on the fact that increased customer loyalty will aid in customer retention — and translate into more transactions. Holding onto existing customers who are already familiar with the brand is less costly than constantly amassing new customers, Rugaber points out.

Retailers also get your data. You may provide your name, email or phone number when you create an account. That information could be tracked with your purchases and could leave you vulnerable in the event of a data breach.

“The benefit for the brand is, knowledge is power,” Rugaber says. “Data drives the ability to better engage.”

“With that transaction of ‘I’m going to give you access to my data for the benefits of the loyalty program,’ certainly the consumer wants to be aware of who they’re offering their data to and what their rights are.”

While rewards programs are also called loyalty programs, they don’t engender true loyalty, says Ryan Hamilton, associate professor of marketing at Emory University in Georgia.

For example, Hamilton says he’s a loyal Cleveland Browns fan, even when the team loses. But if the terms of a loyalty program ever change, he may stop using it exclusively.

Rewards programs are transactional, and consumers are looking to get something out of them.

What does it take?

You — yes, you — can score savings like the examples at the beginning of this article. Here are three ways to do it.

  • Look for a program. Check to see if your favorite retailers, restaurants or other brands have a rewards system you can join. “Most retailers have programs,” Rugaber says. “Just try to see if one exists in the first place.” Registration is quick and can often be done online.
  • Set your sights on savings. While you should avoid spending money solely to garner rewards, it’s smart to optimize your purchasing behavior. “Understand both the rules and also the potential benefits,” Berger says. Learn what purchases count toward points, how many points you need to reach a certain reward and so forth.
  • Take your blinders off. If you’re sticking with one brand exclusively, loyalty can actually ace you out of deals and opportunities. So occasionally check for offers from other brands. “One of the costs of the program is limiting your freedom of choice,” Hamilton says. If the benefits still outweigh the drawbacks, start working your way toward savings. “If you are all in and you’ve decided the costs in terms of information and reduced variety are worth it to you, then learn the ins and outs of the program,” he says.

This article was written by NerdWallet and was originally published by The Associated Press.

Courtney Jespersen is a writer at NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article Make Your Brand Loyalty Pay Off originally appeared on NerdWallet.

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4 Things to Know if You’ve Never Budgeted Before

Posted on by Courtney Jespersen

We’ve entered a new year and a new decade. Not surprisingly, this fresh start has probably brought new goals to mind — like money management.

If you’re planning to start balancing your income and spending, here are four things to keep in mind before you dive headfirst into budgeting in 2020.

1. Budgets aren’t just a New Year’s resolution

If budgeting is one of your New Year’s resolutions, maybe it’s time to think about it differently.

“My personal opinion is forget New Year’s resolutions,” says David G. Metzger, certified financial planner and the founder of Onyx Wealth Management in Chicago. “They never work.”

Budgeting is more than just a January whim, so don’t view it as such. Before you begin, be honest with yourself about if you’re ready to make changes that extend into the foreseeable future.

2. You’ll need a support system

Know that you don’t have to do it alone. Tools like budget apps can help track your spending, while people in your life can hold you accountable along the way.

“An accountability partner or budget buddy can really be helpful when your motivation is waning about the end of February,” says Colleen Weber, a CPA and certified financial planner in Chanhassen, Minnesota.

If you’re part of a couple, devote 20 minutes each week to talking about money together, she says. Look back at your recent money decisions, anticipate major expenses coming up and get on the same page about strategies to reduce spending in the week ahead.

Even if you’re not part of a couple, potential encouragement is everywhere.

“If you have a picture of a vacation place that you want to go to, post it on your refrigerator or somewhere where you would see that regularly,” Weber says. “You can say, ‘This is why I packed my lunch today. I’ll be in the Bahamas this time next year.’”

3. Fun won’t be a distant memory

When you commit to budgeting, you don’t have to kiss movies, concerts, vacations and fancy dinners goodbye. In fact, it’s crucial for you to leave room for discretionary spending.

“A budget where there is no room to have fun — you’re wasting your time,” Metzger says. “Nobody wants to live that way. Nobody’s going to live that way.”

Ideally, according to the 50/30/20 budget, 50% of your budget should be allocated for needs, 30% for wants and 20% for savings and debt repayment.

When you do have to cut back, it helps to change your thinking. Budgeting doesn’t always have to be confining, especially if you’re accomplishing goals like saving for a house or paying down debt.

“Think of it in terms of a predetermined spending plan and not a budget restriction plan,” Weber says.

4. Don’t expect perfection

Remember, you’re not perfect — and your budget doesn’t have to be perfect. Be patient with yourself, especially if you’re taking steps in the right direction.

“Cut yourself some slack,” Metzger says.

That being said, check in on your progress regularly to review your spending and ensure you’re following through with the budgeting goals you’ve implemented.

“If you’re making positive changes and you’re making these positive incremental steps, take stock of them,” Metzger says.

Courtney Jespersen is a writer at NerdWallet. Email: courtney@nerdwallet.com. Twitter: @CourtneyNerd.

The article 4 Things to Know if You’ve Never Budgeted Before originally appeared on NerdWallet.

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