Have a look at the 5 financial tips for the last week of May 2012.

Tip no 1 - Save enough money before purchasing any luxurious item.

Possessing luxurious items and products has become a symbol of financial status. People love to own bags and clothes of luxury brands. If you wish to buy such a product or item, then start saving money from now onwards. Find out the cost of the item and keep aside a certain amount from your paycheck to buy that product. Other than that, research on the product you want to buy. A lot of websites offer the luxurious items at discounts. You can visit those websites and strike a deal.

Tip no 2 - Keep only one credit card to meet your emergencies.

Financial emergency can arrive at any moment. It may come in the form of a huge medical bill or car repair cost. Credit cards come handy in those situations. You can use a credit card to pay your medical bill or some other bills. Due to this reason, it is vital to keep one credit card only for the financial emergencies. Don't use this card to meet your daily expenses. Use cash or other credit cards/departmental cards to make various purchases.

Tip no 3 - The government can garnish social security benefits and take your tax returns for defaulting on a federal student loan.

Usually, private student lenders can't touch your Social Security benefits for defaulting on the student loans. However, the same thing can't be said about the federal government. They can with hold your tax returns and take away your Social Security benefits if required. So, make sure you don't default on a federal student loan. If you do default on a federal student loan, then look for the repayment options from now onwards. Find out the escape route as soon as possible.

Tip no 4 - The new FICO 08 model has put an end to 'piggybacking'.

Piggybacking is often used by the people to improve their credit. People often become the authorized user of another person's account (which is in a good status) to boost their credit score. Some parents make their children as the authorized user of those accounts which have long credit history or high credit limit. This helps the children to improve their credit. However, this thing won't be happening in future. The new FICO O8 model has put an end to piggybacking. This has been done to judge the creditworthiness of a person more easily and accurately.

Tip no 5 - Use your credit cards only during emergencies and change the habit of using it unnecessarily.

Credit cards are important financial tools. You can buy various things in this world through credit cards. However, make sure you have at least 1 credit card for meeting the unexpected financial jolts. Don't spend your credit cards unnecessarily. They come with high interest rates which you may not afford to pay every month. Use cash to buy your daily necessities. If you're very much addicted to the credit cards, then keep them in a refrigerator. Have control over yourself to avoid unnecessary financial troubles.