Credit Card Debt
C'mon, girl! Paying only the minimum. Wanna guess how long it'll take you to hit zero? See the credit card repayment calculator at federalreserve.gov. Ouch!
That's better: Paying twice the minimum every month. It's not as scary as it sounds-on a $1,000 debt, this might take you from $20 to $40. An easy technique: Make that minimum payment with each of your twice- monthly paychecks.
Really good: Snowballing debt: Pay the minimum on all of your cards except the one with the smallest balance. Lob every extra dime at that one till it's gone. Then start on the next, adding what you were paying on card #1. Repeat. Aim to be debt- free in three years or less.
Gold star: Using a zero-percent-interest card. Transfer your balances to it for the life of the offer (usually 12 to 18 months), and pay it off before the interest jumps. (For offers, see creditcards.com.)
Related: 25 Lazy Ways to Save Money
C'mon, girl!: Emergencies? Isn't that what credit cards are for? Um, no.
That's better: Keeping one month of living expenses in the bank, and adding more money here and there when you think of it. Need motivation? The site saveup.com awards points--good toward prizes--for money-smart moves like stashing cash.
Really good: Having three months of expenses saved, and making a deposit every time you get a windfall, like a tax refund. About 28 percent of Americans send theirs right to savings. Join in.
Gold star: Having six months saved, or setting up an auto-transfer that feeds an interest-earning savings account every payday until you get there. Check bankrate.com to find accounts that earn the most interest.
C'mon, girl!: Not saving toward retirement, even if it's so you can bank bucks for your kids' college instead. Reality check: They'll be able to get loans toward their goal; you won't.
That's better: Setting aside 10 percent of your income. Or, if you have a 401(k) or other employer-sponsored retirement plan, contributing just enough to get a match (probably 5 to 6 percent of your salary)--which won't be enough to fully float your sunset years.
Really good: Investing up to $5,500 a year--the max currently allowed for people under 50--in a Roth IRA, in addition to saving that 10 percent (or 6 percent with match). Check rothira.com for details.
Gold star: Socking away 15 to 20 percent of your income. Get that employer match and max out a Roth IRA (if you're eligible), and/or put the rest into a taxable investment account.
Related: The 5 Financial Decisions That Set You Back Thousands
C'mon, girl!: Your "budget" is a running guesstimate--and your steadily increasing credit card balance shows that you don't always nail it. Most Americans don't have a budget, so you're far from alone in that.
That's better: Spending less than you make overall, even if, week to week, it feels like you're always playing catch-up. Where does all your money go? You're not quite sure.
Really good: Tracking your spending and staying steadily within a budget. One easy way to do it: Use Manilla (an app and site) to organize all of your expenses.
Gold star: Having a simple system you can use for the long term, such as the 50/30/20 rule: 50 percent essentials, 30 percent discretionary, and 20 percent priorities (such as retirement, savings, or debt). Even better--you're sticking to it.
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