Ilyce Glink, Author at Best Money Moves

3 Simple Budget Saves That Will Lower Your Financial Stress

by Ilyce Glink | Sep 21, 2016 | Blog

Financial stress is overwhelming – and more so when every little thing seems to pile on top of each other.

With so many financial issues for you to tackle, sometimes it seems like a miracle is the only possible way forward.

Not so. While financial stress can be overwhelming, small budget saves can help you re-float your boat, save and pay off debt. In short, small changes actually can make a huge difference over a relatively small period of time.

You’ve got to keep it simple. Much like paying off a smaller debt first to gain a sense of victory and motivation, your employees can revise their financial strategies in small ways to make things easier for themselves.

Here are three budget saves you can put into place today that will put you on the path to financial success. They won’t alter everyone’s money situation overnight, but give them some time, and keep working at it, and the benefits will show up.

1. Switch to a cash budget. When someone can’t get their spending under control, they end up compounding their problems by piling up credit card debt and high-interest charges. Switching to a cash budget removes these risks by giving them a limited amount to spend that they know they can afford. Here’s how it works: Decide how much you’re going to spend each week, then take out that cash from the bank or ATM and commit to not spending any more until the next week. It’ll take time to get used to having cash in your wallet (we’ve all become so used to the cashless society) and you’ll need to adjust to new spending habits and plan around what you can and cannot afford. Even if you blow your budget for the first few weeks, just stick with it. You’ll soon see positive changes. One study by the Urban Institute showed that those who were reminded throughout the month to choose cash over credit were able to lower their credit card debt. And, that’s key.

2. Make savings – and payments – automatic. Staying on top of multiple monthly payments, from utilities and rent to credit cards and student loans, can be difficult and barely leaves room for you to think about savings. Switching to automatic payments and savings, however, gives you a chance to avoid late charges and increase your savings without thinking about it. Often, employers will allow employees to set up recurring deposits from their paycheck to a savings account each payday to build up emergency or retirement savings without any additional steps. They can pick an amount that’s affordable and realistic, even $20 per month, and over time they may be surprised by how that amount grows. Using automatic payments for recurring monthly expenses can do the same, streamlining payment processes and giving your employees more time to focus on lowering their stress in other ways.

3. Cut out or reduce one expense each month. If you’re in serious money trouble, nothing dashes your hopes for a solid financial future faster than believing that you’re powerless to change it. One way you can take back control is to identify and reduce – or cut out entirely – one expense each month. This could be your cable or cell phone package, commuting costs, money spent dining out or even a morning coffee. Encourage your family (if you have one) to find ways to lower their monthly bills, whether it’s avoiding a splurge or calling the relevant company to ask about other options. Not only will you lower your overall expenses it will help you reduce your financial stress because you’re in much more control of your cash.

Your Best Money Moves: If your employees are struggling with their finances, gaining some knowledge and feeling support from their workplace can make a big difference in their stress levels, if only by letting them know they’re not alone. You can start by sharing small changes like these and encouraging and celebrating the efforts of your workers. Even when the solution is simple, the work behind it can be difficult and your employees will appreciate your support when it comes to their financial stress.

Why 50% of Americans Can’t Understand Their Credit Cards

by Ilyce Glink | Sep 14, 2016 | Blog

Remember life before credit cards?

Best Money Moves Founder/CEO Ilyce Glink remembers her grandfather carrying around a wad of fresh $20 bills, peeling them off one by one to pay for dinner.

Credit cards changed the way we pay for everything. Credit card companies made them easy to use – too easy. That’s why so many of us are carrying around so much credit card debt.

To responsibly use a credit card you have to understand its terms. Unfortunately, many credit cards don’t make their terms and conditions easy for customers to read.

According to a recent study by Creditcards.com, the average credit card agreement is written at an 11th grade reading level and would take 20 minutes to decipher. That might seem okay (after all, most people have graduated from the 11th grade), but 50 percent of Americans read at a 9th grade level or lower, making it difficult for most people to fully understand their rights as a cardholder.

This helps explain why employees repeatedly rank paying off debt as a top source of financial stress: if they can’t understand their credit cards, they can’t use them responsibly. This results in issues with debt, late payments and confusion about how they can pay off their debt quickly.

Missed information

If you don’t read your credit card agreement, you might wind up in trouble: You won’t know the terms and details unique to this card and your usage will be driven by your general credit card knowledge, rather than the habits that work best for this specific card and financial situation.

We learn by observation: If you grow up with parents who regularly carried balances on their cards, you might think this is a perfectly normal way to manage your financial life. It’s not until you read the fine print and see how fast the interest rate charges will rack up and how long it will take you to pay off that debt that you might change how you manage your credit card relationships. This isn’t just about missing out on reward points because of a misunderstanding about how they’re earned, it’s about consumers never learning their rights and responsibilities when it comes to credit card usage, and exposing themselves to unnecessary financial risks.

According to the study, only 26 percent of those surveyed said they regularly read their credit card agreements. If you or your employees or colleagues only read one quarter of the contracts used in your office, your company would pretty quickly find itself in a load of trouble.

Financial stress at work

The study also claims that the less familiar card users are with their credit card’s terms and rules, the more they’ll end up paying to use that card over time in interest charges and fees. The more debt employees carry, the more financial stress they’re going to feel. This stress doesn’t stay confined to their finances – it also spills over into their work and their day-to-day lives. If you want to help, you have to provide your employees with assistance they can use. You can’t change how credit card companies write their contracts, but you can help boost the knowledge your workers have.

Here’s your Best Money Move: The more you know about financial stress and your options when dealing with money, credit cards and debt, the better prepared you’ll be to deal with these issues when they arise.

What’s the Biggest Source of Financial Stress in Your State?

by Ilyce Glink | Sep 9, 2016 | Blog

Are you financially stressed? Do you know what’s causing it?

A recent study by GoBankingRates.com asked Americans to identify their biggest financial stressor and then broke down the results by state. Check out the map above to see which financial issues are keeping your neighbors awake at night.

The most common stressor cited was paying off debts (including credit cards), with 20.6 percent of respondents saying this was their biggest financial concern. It topped the list in 30 states and tied with other issues as the most common stressor in another three states.

The stress of paying off debts, as we’ve discussed in earlier blog posts, can negatively impact many different aspects of your life, from your personal relationships to your job performance.

What can you do to reduce this stress? Clearly, paying down (or off) your debt will help. There are two big steps you can take to start whittling away at your debts.

Build a budget: Track all of your income and spending for one or two months straight – every single dollar that comes in and (even more importantly) everything you spend. You can use a spreadsheet, pen and paper or our Best Money Moves Budget Tool, whichever is easiest for you. Look at your expenses and decide where you can cut some of your spending, whether it’s making your coffee at home instead of paying for it at Starbucks every day or finding something to watch on Netflix instead of going to the movie theater every weekend. The more you cut, the more progress you’ll see.
Pick your payoff strategy: If you have a lot of different debts, it probably feels like you’re just throwing your money at them with no real idea of how long it will take to pay them off. Choose a strategy for making your payments, continuing to pay the minimum on each but focusing any extra you have on one of the following methods:
1. High-interest first: Concentrate on paying off the debt with the highest interest first, then moving to the next highest; or
2. The snowball strategy: Tackle the smallest debt first, then “snowball” the money you were putting toward paying off that debt into the next-smallest debt after you pay off the first, continuing upwards until you’ve paid off all of your debts.

Want to learn more about how to tackle your debts and reduce financial stress? Email us at info@bestmoneymoves.com to be included in a free trial!

How Financial Stress Rises with Your Rent and Home Expenses

by Ilyce Glink | Sep 7, 2016 | For Employers

There are certain expenses everyone deals with no matter how extravagant or restrained their lifestyle. Housing is at the top of the list, both because you need a place to hang your hat and because it’s usually the single largest bite out of your monthly take-home pay.

Unfortunately, this is the most basic and important of expenses. Whether it’s a house, apartment or condo, everyone needs a place to live and this basic expense can quickly become your biggest source of financial stress.

According to a September National Rent Report by Zumper, eight of the 10 most expensive rental markets in the country have either maintained their spot or moved higher on the list, even as prices for one and two-bedroom units dropped slightly for the first time all year. This might sound like business as usual but for employees looking to decrease their financial stress, it’s bad news for their budgets.

Employees can downsize their budgets in many ways, from cutting meals out to limiting their entertainment spending, but housing is a relatively fixed cost and it’s hard to find wiggle room until your lease comes up for renewal. And then, where do you go if rents are rising everywhere you want to be? one staple that has lost most of its wiggle room. If you want to know what your employees are stressed about, housing is one area you can’t ignore.

What’s the fix?

The recommended rule for figuring out how much to budget for housing is to cap it at 30 percent of your income, leaving at least 60 percent of your budget for other expenses like food, healthcare, debt payments and savings. The problem for an increasing number of employees is that these figures have made maintaining this ratio difficult. If employees want to spend under $1,000 each month on rent, for example, they’ll need to look to the 30th most expensive city on this list, downsize the space they live in, move to another neighborhood or find an alternate way to manage rising rent or housing expenses. And until they can make this change, they’ve got less room in their budgets for other necessities.

Changing a housing situation isn’t impossible, but it is a recurring cost people are locked into for months or years at a time, that will affect them every day. If that cost climbs too high, or there is an unexpected jump, it creates a cycle where that cost eats into the rest of their finances, increasing their financial stress and keeping them from making progress with their budgets, debts and retirement savings.

As an employer, you want to help defray this expense but may be at a loss for where to start. There are small steps you can take, like offering transit assistance for your workers’ commutes or opportunities to work remotely, but the root of the problem is much deeper.

Employees have to get control over their budgets and learn how they can change their housing situation for the better. For some cities, moving to a new neighborhood may be the only viable option, but it’s one your employees have to discover in order to take action.

If you want to reduce financial stress in your workplace, talk to your employees and see what assistance they need. With the right knowledge and tools, they can decide on a solution that gets them to a stronger financial position. They can’t count on a major drop in their rent (it’s an expense that tends to rise over time), so it’s time to find a new way around this cost and get it back down to the recommended 30 percent threshold.

Whether it’s small changes or a big move, there’s no better time to get started than right now. You’ll be amazed at what a small savings on housing can do for the rest of the monthly bills and, consequently, your employees’ financial stress level.

Dustin Pellegrini is a senior web producer and writer at Think Glink Media, where he specializes in reporting credit and personal finance topics. He studied writing and visual media at Columbia College Chicago.

Making Labor Day Meaningful For Employees

by Ilyce Glink | Aug 31, 2016 | Blog

We’re a few days out from Labor Day – the celebration of all the work employees do – so let’s talk about making Labor Day meaningful for employees and their bosses.

One of the top biggest reasons workers leave their jobs is because they don’t feel their work is appreciated. Whether they feel they’re underpaid or that their work goes unnoticed, it leads to the same chain reaction: anger, stress and eventually giving their two weeks’ notice.

But that isn’t what employees want – and it isn’t what employers want either. The uncertainty of the job market causes a huge amount of financial and emotional stress for employees. Meanwhile, employees don’t want to feel forced back into the uncertainty of the job market, and employers have don’t want to scramble to find new hires and they’ll have an agitated workforce filled with unsatisfied workers.

So, what’s the fix?

First, put yourself in your employees’ shoes. You have to understand what your employees feel they deserve and then identify what you can do to make them feel more valued. This isn’t as easy as giving everyone a raise, as the budget may not allow it, but you may find that not everyone is solely interested in making more money.

According to a recent report by the Society for Human Resource Management, the biggest drivers of employee satisfaction are, in order, respectful treatment of the employees in the workplace, compensation, benefits and job security.

If you want to increase employee satisfaction and you’ve heard concerns about job security or the treatment of employees around the office, that’s where you should start. Or, if your employee reviews reveal that your workers are interested in new perks – like working remotely or a more flexible time-off policy – think about how you can implement these ideas without affecting productivity.

While you’re putting your new plans into action, remember that an employee’s age and experience may affect what perks they appreciate at work. According to the study, millennials reported the lowest levels of job satisfaction, while Boomers and those close to retirement were the happiest with their jobs. Think about what this means for the benefits you offer and the environment you’re creating. Everyone appreciates a day off, but some workers will value consistent raises while others want more vacation time.

If you’re unsure where to start, just ask your employees. No one knows what your employees want more than they do. It’s important to know your limits on what you can and cannot offer, but don’t let these barriers keep you from making any changes or improvements. Your workers will notice your efforts to address their concerns, whether it’s through new perks, raises or a combination of benefits.

So, on this Labor Day, understand that your show of appreciation doesn’t have to be an enormous change-of-management demonstration or once-in-a-lifetime bonus as long as it’s consistent, authentic and relevant to what your employees want. But putting in the effort to make your employees feel valued and appreciated will juice workplace profits over time.