Should I Get a Credit Card?

There are 2 kinds of people who use credit cards. There are those who use them and then pay them off in full every month, and then there are those who run up a full balance and spend years paying them off slowly.

Which one are you?

If you're the latter, then read this post first and become the former instead - Credit Card Maths

So what use is a credit card then?

Credit Card Maths

In a previous post about interest rates, I mentioned how long it can take to pay off your credit card.

The example I gave was from a major credit card company that charge a rate of 19.9% APR, which is pretty average for these sort of products, with an outstanding balance of £3,000 which is not uncommon.

I also mentioned I had knocked up a spreadsheet to help work out all of this for myself, and that I would shortly be sharing that.

Well here it is:

Interest Rates

Interest. It's the killer isn't it? 

Understanding how it works is key to managing your cash well and staying in good financial health. You would think, as the writer of this blog, that I think all debt is bad, and 90% of the time, you'd be correct too. However, borrowing money is sometimes necessary.

Buying a house for example. 

I could have put money away for each month for umpteen years and then bought my house outright without paying any interest, which on the face of it sounds like a financially savvy way of doing things, but I'm glad I didn't for 2 reasons:

What is Marginal Utility?

I thought I'd write something a little more light hearted today.

As the blog is about "Living Well", this post is about spending rather than freeing yourself from the shackles of bad financial decisions. Of course, freeing yourself up first is always a good idea, as it ultimately leads to the goal of Living Well.

OK, so for a while now, I've been trying to think of an effective way to express a certain concept verbally. What I'm thinking of is related to the satisfaction you feel after you've made a purchase, and how long this lasts.

It's similar to something economists apparently call "Marginal Utility" which I heard about here.

Payday Loans - Are They Ever Worth It?

It's the middle of the month and your boiler breaks down. It's snowing outside and you have no hot water or heating.

The kids are freezing and your wife's turning blue.

Payday is two weeks a away still but you have to get that boiler fixed A.S.A.P. What do you do?

Should you consider a payday loan?

With an easy application process, and cash available in your account within the hour, (they often quote 10 minutes), payday loans can seem like a godsend when you really need the money.

Paying Off Debt - Different Methods

In previous posts, I've covered much about changing your spending patterns and negotiating with creditors. This post is simply about differing ways of paying off your debts, whether you're in trouble or not, and the benefits of doing it using these methods.

You might automatically think that it's always best to pay as much off the debt with the highest interest rate first, because it accumulates fastest, however that isn't always the case.

There's often more than the interest rate to consider

What is Happiness and Can I Afford It?

As this post seems to be quite popular, I've written another related post you can find here:
More Thoughts About Money and Happiness

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What is Happiness.

It seems to be an age old mystery doesn't it?

There are plenty of people who have achieved this of course, and maybe you know some people yourself who seem to be genuinely happy most of the time. So what's their secret? And why is it such a secret??

Does being wealthy make you happy?

Is there something we've all been missing all these years??

Surely the human race had this problem cracked a very long time ago???

Getting Out of Debt - Part 3 - Dealing with Creditors

Threatening letters, constant phone calls, mobile phone texts,  at all times of the day and even on the weekend...

It's enough to push you over the edge. Sadly for some, that's exactly what happens. But don't let it happen you!

There are various ways of dealing with creditors and the constant pressure techniques they put you under in order to try and extract yet more money from you and your family.

Believe it or not, they don't hold all the cards, and there are many things you can do to come to negotiate things in your favour for an agreement that suits you, not them. At the same time you can also take the sting out of their high pressure tactics.

Getting Out of Debt - Part 2 - Managing Your Money

Managing your money isn't simply taking care to spend less than you earn. There's more to it than that. In fact, unforeseen circumstances can catch out even the most careful of us and scupper plans made with the very best of intentions.

Think about this:

Buying in bulk results in making a saving. It has to otherwise what would be the point? However, it can also make you less well off.

Strange, but also true.

Why?

Getting Out of Debt - Part 1 - Income and Expenditure

You've managed to run up debts and now you feel like you're drowning in them. You don't know what to do, or where to turn. It's stressing you out and making you ill, so you bury your head in the sand and try and avoid it. You'll deal with it later, but even coming home from work is worrying you, because you don't want to face reading your mail or answering the phone...

Sound like you? Well it was me until I turned things around and that's not as difficult as you may think.

Realistically speaking, most people think they will have to live like paupers for several years to escape their debt burden, and this is what frightens people away from dealing with their problem. They don't want to have to think about living like that or facing up to it, and can you blame them?

This post is about avoiding that, but still coming out a winner at the end of the day.

Supermarkets - Friend or Foe?

How much of your money do you spend at the supermarket?

If you check your bank statement for the month, you may be shocked to find how often and how much you spend at your local supermarket. I certainly was. £20 here, £30 there, and it adds up very, very quickly. I'm told that out of every £8 spent on the British High Street, £1 of it is spent in Tesco's.

It's no surprise though. Supermarkets are absolute masters at marketing and selling you stuff. They have been doing this for years, and you probably know a couple of their tricks already:

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Cheap Mobile Phone Deals

As a student, (back in the early '90's), I was shocked to be told that before the end of the decade, nearly everyone would have a mobile phone. I think I was one of the last few who held out, finally giving in and getting one in '97 - and now they are considered essential to modern life!

As my own contract is up at the end of the year, I have watched with interest, as various new phones have been released, and my colleagues' behaviour as each of their contracts have run out too (it certainly tells you a lot about the psychology of people).

And people watching is great! In my particular office, we seem to have representatives from all different walks of life. We have the office nerd, the apple fanboy, the guy with little money and even less sense, the tightwad and the admin staff, most of whom are teenagers. It all builds up to give a great picture of what does and doesn't work, and the best way for finding the best value deal for yourself.

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Working Lunches

It's amazing how quickly you can spend money on food at work, but with a bit of very quick arithmetic you can see why.

Imagine it's first thing Monday morning and you're sat at your desk thinking about the whole week ahead. Seems like a good time to have a bacon butty. You know, start work on a high note and a full belly. It'll make you feel better...

Later Monday, you're feeling a bit peckish. You didn't bother with lunch, so you nip out for a packet of biscuits to keep you going. The following day, you go out and get yourself a sandwich from the local butty shop, and so it goes on through the week.

It's very obvious to see where this is going isn't it? At a conservative estimate, you could easily spend £15 or more on feeding yourself at work each week, and spending that amount on feeding yourself doesn't seem entirely unreasonable, does it? Well...

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Living Well on Less - a bit of background

As this is my first post on this blog, I thought I'd better explain myself.

When I was 2 years old, my Father passed away in unfortunate circumstances. As a result, when my grandparents passed on some years later, I received an inheritance that was kept in trust for me until my 18th birthday. When that day arrived, I came into £80,000 worth of shares. Even today this is quite a bit, but more than enough for an 18 year old to go a bit silly on.

With that amount of cash at my disposal, I shouldn't have had to work for anyone ever, but, as I had the money, I didn't worry about it, didn't think about it, and never learned how to budget. As a result, I spent it all on Women and Wine, the rest I just wasted, as they say.

In short, I spent it all, and then it all went horribly wrong...