Here are the 5 financial tips for the 2nd week of August 2011
1. Before repaying a payday loan, make sure payday loans are legal in your state so that you don't make extra payments than you're supposed to make. If they're illegal, you just need to pay the principal balance of the loan.
Check the state payday loan laws before paying back your lender. Find out if lending of payday loans is legal in your state. More importantly, you should check whether your lender has the license to work in your state. If your lender is not licensed in your state, then you are only legally obligated to pay back the principal amount. You won't have to pay the interests or fees.
In case, you have paid far more than the original amount, then you can ask your lender to refund the extra money. If he refuses, then you may get legal help regarding this issue.
2. Maximize your employment benefits
You are entitled to get certain benefits as an employee. You should gather knowledge on these benefits and take advantage of them fully. For example, if you are federal employee, then you'll get the following benefits:
- Health Benefits Program
- Educational loan repayments
- Federal Employees Group Life Insurance
- Federal Long Term Care Insurance Program
You can also get other benefits if you work in the federal government. You can get recruitment bonuses, paid leaves, and subsidies for child care.
If you work in a private organization, then you should contact the human resource department to know about the employment benefits. Try to take the fullest advantage of these benefits.
3. Know about the FDCPA laws to prevent debt collectors from playing dirty tricks
FTC has enacted FDCPA (Fair Debt Collection Practices Act) laws to prevent the debt collectors from bullying the innocent consumers. You should get acquainted with all the major FDCPA laws. This will help you beat the debt collectors at their own game.
For instance, if a collector is calling you at 10pm regularly, then you can file a lawsuit against him. The collectors are only allowed to call you at before 8:00am and after 9pm. So, if a debt collector continues to all you late at night, then report the matter to FTC or State Attorney General.
4. Prioritize expenses to tackle your personal budgeting problems
If you are facing problems in following a budget, then you need to re-look your expenses immediately. It may be the case that you are not able to stick to your budget because of imprudent financial behavior. Find out whether or not your monthly expenses are exceeding your budget income. If yes, then your next task will be to locate the areas where you are spending more. Think rationally as to whether or not you really need to spend so much money on certain items.
For example, you spend $100-150 on chocolates every month. But do you really need to eat chocolates every day? Certainly not! So, you can just skip eating chocolates and save money and calories at the end of a month.
5. Start saving from now for your retirement
It is best to start saving when you are in your 20's. This is the time when you have less family liabilities and responsibilities. You should contribute as much money as possible to your retirement account. Once you are in 30's, you'll become entangled with family responsibilities. You'll have a wife and children to look after. You'll have to pay tax, insurance premiums, mortgage, etc.
Your expenses will double when you are in your 40's and 50's. Your expenses will be far more than what is now. You'll have to save a significant amount for your child's higher education. You won't be able to save a huge amount of money unless you earn a fat paycheck every month.