Beating Broke

Personal Finance from the Broke Perspective

How to Live Like a Prince on a Pauper’s Budget

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Being financially savvy does not mean that you have to deprive yourself of the finer things in life. It simply means that you have to identify what goods and services are genuinely important to you and then find a way to get those goods and services at a great price. You should even think of these small luxuries as investments because the truth is that you are far more likely to stick to a well-thought-out financial plan if you are living a comfortable life.

Embrace small luxuries that mean a lot to you.

Obviously, I am not suggesting that you go out and buy luxury everything. In fact, I am not necessarily even suggesting that you buy luxury anything!  The key to feeling like a prince on a pauper’s budget is looking inwards and finding what those items are that you most want – those are your luxuries. Most of the time, whatever it is that you want can be purchased at a reasonable cost. The trick is to be sure to pick an item that will truly be a luxury to you and not just a passing fancy. If it is a thing, ask yourself how much you will use it; if it is an experience, ask yourself if you will get lasting enjoyment from it. Your answers to those questions will go a long way towards determining if it is a worthwhile luxury or a whim.

Here is an example of what I mean (which also just happens to be the spark that led me to write this article). I recently convinced a friend of mine to buy a turntable that he had been talking about for ages. Everyone in the world knew that it was the luxury he wanted for himself. He knew it too, but he just could not bring himself to “waste” the money. Of course, he finally bought it; and of course, he is glad he did. The two important things to notice here are that it was something that he knew he had wanted for a long time and that it was not terribly expensive. That last part is important, by the way. If you want a yacht, then you are probably out of luck – that would be living like a price on a prince’s budget!

Here are a few quick examples to help you generate some ideas of your own:

Buy a used car: Everyone knows that a new car’s value plummets the second it is driven off the lot. So why not take advantage of that price drop? The used car market has never been so liquid and accessible as it is now, so even if you live out in the country, you will have no trouble finding a high-end used car for a great price.

Shop for things during the off-season: It is astonishing that, after every holiday, stores practically give away their holiday-themed merchandise, and yet we the consumers happily wait until one week before the holiday rolls around again to pay through the nose. You know that Christmas will happen next year, right? So why not buy all your Christmas-themed gifts and ornaments right after Christmas when they are 90% off? Given that many of us can spend hundreds of dollars on holiday-related merchandise, the savings to be had from using a bit of foresight are worth the modicum of planning it takes to get your shopping done early… very early.

The same logic also applies to non-holiday-related goods. At the end of the winter, most stores will have clothes at 50% off or more as they try to make room for their spring and summer collections. In about nine months, winter will be back and you will need warm clothes, so why not buy them when they are being sold at a substantial discount?

Look for free live events: This one might be a little tricky if you do not live in a city, but if you do happen to live in a metropolitan area, you will be amazed at how many free events there are. Art museums will frequently have free live shows and/or exhibits. Local symphonies or university symphonies also will have free or discounted concerts at certain times of the year. There are food truck festivals, art festivals, beer festivals, and the list goes on. Many of these will be free and provide live music and other entertainment.

Being thrifty does not mean that you have to deprive yourself of a good life. Use your judgment to pick and choose small luxuries that will make a big difference to you. Be smart: find the best ways, times of the year, etc. to get these luxuries at a good price. You will find that you really can live a luxurious life and keep your savings intact at the same time.

Covering the Costs of a Car Accident When You’re Broke

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As life would have it, you’ve just been involved in a serious accident. To top it all off, you’ve sustained injuries that will certainly keep you out of work for some time. You’re already strapped for cash, so you’re probably freaking out about how you’re going to survive the next couple of months (or years). Before you add tension to an already stressful situation (and prolonging your healing process), you should know that there are ways to manage – even if you’re broke.

Costs of a Car Accident

Not many people consider the true cost of a car accident. Outside of possibly paying an insurance deductible, you could also be responsible for repairs, medical bills, and medical-related expenses (i.e. co-pays or medical supplies). There’s also the added fact that you’re not able to work until you get clearance from your doctor. This leaves you hemorrhaging money that could result in you not being able to pay your regular bills. Ultimately, knowing where to turn in times of a financial crisis such as this is key to your survival.

Hire an Attorney

If you believe the accident wasn’t your fault, you should consult an accident attorney immediately to discuss your case. If there is sufficient evidence that you were not the at-fault party, a trained attorney may be able to use this information to help you get a considerable settlement from the insurance company or by filing a personal injury lawsuit and pleading your case in court. You could get money to cover your medical bills (past and present), medical-related expenses, and the time that you’re out of work if you win your case. This, of course, would take a load off your shoulders (and your pockets).

Dip Into Emergency Savings

An emergency savings account is an account where you set money aside for a rainy day or unforeseen circumstance. Getting into an accident is certainly an ideal time to use those funds. If you have several months’ worth of income saved in the account, you could find peace of mind in knowing that your bills are covered for a little while until you come up with other financial solutions.

File for Disability

If the injuries you’ve sustained are serious enough, you may be able to qualify for temporary or long-term disability coverage. This would provide you with a monthly income that can be used to cover the bills. It can take several weeks to get approved, so be sure to apply as soon as possible. You’ll likely need your medical reports or notes from your doctor to explain your injuries and ideal time in which you can return to work.

Look Into Assistance Programs

There are plenty of programs available for those going through hard times or living on a limited income. They are free to apply for and could provide you with peace of mind. There are programs to help with healthcare, car insurance, food, housing, childcare, and even transportation costs. Check with your local board of social services to find out how to apply for such programs.

Cut Costs

If you’re really struggling financially you’re going to have to get serious about your spending. Cutting back on your costs could help you save several hundred bucks each month. Cut your cable subscription, cancel monthly subscriptions for products and services you don’t need, or cook at home instead of eating out. You should also use methods like waiting 72 hours before making a purchase to ensure it’s something you really need.

Downsize

You may not like this next bit of advice, but if your injuries are long-term or permanent, downsizing may be the only way to survive financially. If you’re already broke or living on a shoestring budget, eventually, you’ll find yourself accumulating more and more debt and causing a plethora of financial trouble for yourself. If necessary, move to a smaller house or more affordable apartment, or consider living with family to give yourself a financial break.

You never thought you’d find yourself dealing with the aftermath of a serious accident, but here you are. Though overcoming this situation requires more than finances, when you’ve got bills piling up and can’t afford the bare necessities, the stress really adds up. As increased stress only intensifies pain and prolongs physical and psychological healing, it is ideal to have solutions to help you cover the costs of the car accident. With such a big stressor lifted, you can focus your energy on your physical and emotional well being.

You Can’t Become Debt-Free Without Changing Your Mindset

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Some people have the skills early in life and understand the importance of saving money. While others live life for the moment without giving any thought to the future. Unfortunately, the majority of the workforce falls into the latter group. Without changing your ways, you won’t be able to ever successfully achieve stability when it comes to your finances and enjoy the fruits of your efforts. The good news is that it’s never too late to change your mindset and learn how to save money.

Borrowing Money

When you spend everything you make, you’ll need to borrow money often. This cycle of borrowing is costing you a prosperous financial future. Before long, you’ll owe money to family, friends and banks. Once your credit drops, your ability to borrow more money from a lender becomes nearly impossible. There are other lenders with less stringent guidelines for small amounts of money such as short-term installment loans.   Another thing you should be doing when you’re thinking about borrowing money is evaluating your options.  For example, if you’ve got a huge amount of credit card debt, you might be better off looking for home equity loans.

Controlling Your Spending

The first step to becoming and remaining debt-free is to control your carefree spending. It’s easy to order lunch out and opt for take-out at home for dinner a couple of times a week. However, the money you’re spending is preventing you from having money in the bank for other things. Bringing your lunch and eating out just once or twice a month will help you reel in your spending and have money on hand for things you really need.

Misuse of Credit

Credit is a wonderful thing if you use it correctly. However, you should always think long and hard about any purchase, especially before placing it on a credit card. For example, some people have cards that offer rewards for use. They use them to buy airline tickets, pay for hotel rooms, buy dinner at restaurants and pay for groceries at the supermarket. However, when the bill comes in, they pay it in full and avoid paying interest while still achieving the rewards. If you use credit cards correctly, you can benefit. However, many people get credit and misuse it. They view it as extra money and begin to think of ways to spend it. Soon, the credit card is maxed out, and the bill comes in. Now you have more debt with interest accruing.

Live Within Your Means

You have a decent job but you still struggle to make ends meet at the end of each month. This is an unpleasant fact for many families across the US. You own a home at the top of your price range, have two cars with payments and several credit cards with hefty balances. Living within your means is the only way to live life comfortably. When you start out life with piles of debt, you’re setting yourself up for financial ruin. Unfortunately, banks are similar to fairweather friends, when your credit score is good, they want you, but fall from grace and you’re no longer welcome.

Crafting a Budget

If you’re ready to change your spending habits and live within your means, you’ll face a bright financial future. Luckily, there are many budget apps online for free. Select the one that best fits your current collected debt. A budget is more than simply a sheet of paper with a bunch of numbers. It gives you a clear accounting of your financial status. You get to see not only the amount of your debt but also from where it derives. This is important. Sometimes seeing how much money you waste can be a real eye-opener.

If you want to become debt-free, it takes a commitment to change your spending habits and how you view money. With a different mindset, you can move forward and learn the importance of saving today to fund tomorrow.