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Use money management tips to improve financial securityMost people have times in their life when it seems as if their money has wings. For many, the holiday season, with extra as well as end-of-the-year expenses, is an example. The cash crunch can be a challenge, yet also can make the end of the year a good time to review personal financial goals and consider saving and spending priorities. Doing so need not be difficult. Consider saving receipts and reviewing them, noting expenses in a check register or pocket notebook, or using a computer financial management program to identify unnecessary spending. We have to know where our money is going before we can make changes to improve our financial situation. If you are choosing a beverage from the vending machine at work each day, ask yourself: "Do I really want to spend $250 or more a year on beverages?" Consider carrying your own water or other beverages and save what you would have spent toward an emergency fund or a personal "would-like-to-have." The choice is up to you. Successful money management and financial security requires a self-assessment and personal choices when it comes to saving and spending. After tracking expenses, be looking for ways to reduce expenses. Credit card debt will be an issue for many people. One way to avoid this is to put away the plastic: "Carrying high-interest loans and credit card debt is an example and commits future earnings that might be better spent or saved for other financial goals." Make paying down credit card and other high-interest loans as quickly as reasonably possible (while still meeting other necessary expenses) a priority. Good advice is to not charge on your credit cards more than can be paid in full during a billing cycle. Consider building up a cash reserve for an emergency fund and saving for short- and long-term goals. Get in the habit of "paying yourself first." Ways that this can be done is to enroll in payroll savings, which are automatically deducted from a paycheck, or regular automated transfers from a checking to savings account. Automatic savings can help to make saving a habit. The Consumer Federation of America currently recommends $1,500 as a minimal basis for an emergency fund. As little as $10 a week will yield savings of $520 a year. While such an amount my seem insurmountable to individuals and families who are struggling, the main thing is to begin by savings something. As little as a dollar a day can be a beginning toward building an emergency fund or cash reserve. If you are entitled to an income tax refund, use this to pay down bills and establish an emergency fund. Building an emergency fund that is equivalent to 10 percent of your income or six months of earnings is a good goal. Date: 10/22/2012
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