Posts Tagged ‘bankruptcy’

Road to Savings

Thursday, February 7th, 2013

I recently contacted a lady named Debbi King on a website I came across. She has many of the same principals on saving money as we have used ourselves and in our book, Stop Wasting Money. I asked her to share  as a guest blogger what does it really take to start over financially for our followers. Debbi’s contact information is found at the bottom of this article.

We all say that we want to save money, but many of us don’t know where to start.  I had this same feeling years ago after I had filed for bankruptcy and was starting over, financially.  So I decided to start everywhere.  That seems like too much, but let me explain.

One of the greatest tools I used to turn my financial life around was a budget.  I know most people cringe every time they hear the word “budget”, but it is a great tool if used properly.  You can’t look at a budget as something keeping you from having what you want.  You have to look at it as a tool for you controlling your money instead of it controlling you.  I challenged myself to look at every category and see where I could save money.

There are two main kinds of expenses we all have:  fixed and discretionary.  You can find savings in both categories, although the discretionary is the one you have the most control over.  Let’s visit both kinds of expenses and see where you can save money.

Fixed Expenses

  • Rent/Mortgage – You may think that you can’t control this item, but you can.  You decide where you are willing and want to live.  Your rent or mortgage (with insurance and taxes) should be no more than 25-27% of your take home pay.  If it is more than that, you are living in a place you cannot afford.  It is okay to move or sell your house.  A house is just a building and you will find another one that you like.  A home is wherever you are.  We downsized from an apartment with a $750 rent to an apartment with a $500 rent.
  • Telephone/Cable/Cell Phone – These expenses are a mix of need and want and you need to adjust them accordingly.  If you are in a contract on any of these items, you will either need to wait until the contract ends or pay the early termination fee, whichever is less.  These are items that you can have and should have, but you don’t need all of the bells and whistles and every channel they offer.  We went from a phone with a plan to a great prepaid phone.  We also went to basic cable.
  • Electric Bill – You can’t change what company you use or what they charge, but there are hundreds of simple changes you can make within your home to lower your bill.  Some examples are unplugging every plug when you are not using it, turn a light off when you leave the room, use the energy cycle on your appliances, and lower/raise your thermostat two degrees in the winter/summer.  We did everything from lowering the heat and layering to drying clothes outside in the summer.
  • Credit Cards – If you have credit card debt and monthly payments, you do not have a lot of control over your monthly obligation.  However, you can if you have good credit, combine all of your cards onto one new card with a lower interest rate and focus on paying that off.  This isn’t new debt; it is a way to manage debt you already have.  The best thing you can do while you are paying the credit cards off if to not incur any additional fees above the interest you are already paying.  This means always pay the minimum and make your payment immediately upon getting the bill.  This will save you in late fees and additional interest.  We stopped all debt and then attacked a debt snowball to pay back the couple of credit cards we had.
  • Car Loans/Insurance – Again, it will be hard to lower a car payment, but you can get rid of your car payment by selling your car, paying off the loan and buying a car with cash.  With your car insurance, the key is to shop using an independent insurance agent.  And as soon as you get your $1000 emergency fund in place, up your deductibles to $1000.  This will save you a lot of money.  We use a great independent insurance agent to shop for us every six months and we drive well in order to not get any tickets that would cause our insurance to go up for 3 years.

Discretionary Expenses

  • Groceries and Eating Out – Eating out should be a treat, not all of the time.  With groceries and eating out, always look for coupons and deals.  Do not be ashamed to use a coupon.  Also, take advantage of discount grocery stores such as Aldi and Bottom Dollar Food.  The food is the same at a much lower price.  Make sure to know what is on sale and stock up when you can.  We started buying store brand when possible, stocking up when meats and cheeses were on sale, and planning our meals before we went to the store.
  • Gasoline and Car Repairs – You can’t control the price of gas, but you can get the most out of your tank.  Plan your errands and trips and get the most done at once as possible.  Also, how you drive and maintain your car can affect your gas mileage and your repairs.  We started planning our outings better and driving no more than 5 miles over the speed limit.
  • Entertainment – Plan for something once a month if you can, but learn to take advantage of free fun.  You need to have fun in your life, but do not go broke doing it.
  • Clothing – You can find great items at your local thrift store and consignment shops.  Or even at your local discount store.  You don’t have to buy everything at the mall.  We learned to live with what we already had.  If we needed or wanted something, we found a way to get it at the lowest price possible by taking the time to shop around and waiting until we found it within our budget.

These are our categories on our budget and how we found savings in each one.  You may have budget categories in addition to these and I would challenge you to think about how you can save money, even a few dollars, in each category.  I read an article yesterday where a guy saved $275 a year just by changing brands with his everyday products like soap and deodorant.  Savings can be found anywhere and they all add up.  Start finding your savings today and watch how fast they grow.

 

 

Written by Debbi King

Personal Finance Coach, Motivational Speaker and

Author of “The ABC’s of Personal Finance”

www.abcsofpersonalfinance.com

www.facebook.com/abcsofpersonalfinance

How a Franchisee Can Help Turn Around Its Reputation and Financial Situation After Bankruptcy

Monday, June 27th, 2011

In this day and age with the economy in the state it is in many companies and individuals have had to file for bankruptcy. Below is suggestions if an individual franchisee owner has to file personal bankruptcy under chapter 7 or chapter 13 on how to get back on their feet.

Guest post by Sophie Kinsella

The Impact of a Franchisor’s Bankruptcy on A Franchisee

The immediate Impact- When a franchisor files for chapter7 or chapter 13 bankruptcy, the franchisee greatly suffers from it. From training and advertising to marketing and supply chain- every single system gets dismantled. The franchisee loses its operational assistance from the franchisor. If the franchisor had any financial obligation towards the franchisee, with bankruptcy filing this even gets dissolved. And the ultimate damage comes in the form of damaging goodwill of the franchisor and obviously of the franchisee as well. It tarnishes the image of the company and lowers the public acceptability about their service and product.

How can a franchisee get back on its feet again-?

When such news spreads among public, a franchisee should take immediate action to wipe off the rumor from the mind of its consumers. There is a common perception among people. when franchisor files bankruptcy, people get under the impression that all its franchisees have also been collapsed at the same time. However, to eradicate such impression the franchisee should contact all the media channels television, radio, news paper and need to announce that the franchisee is in a sound condition. They have to tell repetitively that the franchisee is an individual and independent business party. They are totally untouched by any of the effect of bankruptcy. This is very crucial step for a franchisee to retain its business in the midst of this turmoil. Sometimes, the rival groups of the franchisor comes on the stage and keeps on bombarding the people with such negative campaign against the bankrupt company, that it hardly becomes possible for a smaller franchisee to fight for its brand name. If you need a detailed information on Bankruptcy, then please visit this website: http://www.ovlg.com/

Franchisee should consider it as a boon, not as a bane-

In this circumstance, a franchisee must make some quick decision to mobilize its business and save itself from any potential lose. The franchisee falls into desperate predicament, when it loses the goods and services previously supplied by the franchisor. But now the franchisee cannot stop selling the products any more. It should immediately try to get access to the original supplier of the franchisor. It has to buy directly from that source and continue its business. As the franchisor had huge purchasing capacity, it could offer low price to the franchisee. From this time the franchisee might have to purchase those goods at higher price. But the franchisee will also get a great benefit from this if it can utilize this situation as an opportunity to become an exclusive provider of those goods and services. It is actually a golden opportunity a smaller company to grow bigger and tab the extensive market of the franchisor.