What was I thinking with all that talk about filing a few days early?!? We fixed it up years ago to avoid withholding, so we keep our money in our pocket. Why let the government draw interest on our money, right? Since we are paying them, why pay one minute early? We file and pay at the last minute and earn interest all year long!
|Disney fans can save big bucks.|
We buy everything with rewards based credit cards. But it takes discipline... there is a danger if you don't pay off your balance every month. You can easily slip into a debt cycle that is deadly. You absolutely MUST pay revolving credit off EVERY MONTH!! Beyond that, you must set aside money every month for taxes, too. So, even though we pay the taxes with a credit card, and pay a fee to do it, we pay that off before the due date on the credit card.
But what if you've gotten yourself in a pickle and can't pay the IRS what you owe? They offer a monthly payment plan. Believe me, ('cause I was a professional tax preparer and enrolled agent with the IRS for over 40 years) you do NOT want to fail to file because you can't pay! File your return ON TIME with a request to set up payments. What, not putting it on a credit card? Right. If you can't pay the tax, you can't pay the card right away, either. The government will be charging interest but NOT the outrageous percentage the credit card will hit you with... stay with Uncle Sam.
So, I didn't intend to do a tax/finances lesson blog, but since it just turned out that way, here are a few tips you might benefit from:
• Make a TAX DOCUMENTS FOLDER for each new tax year and put any relevant receipt or document in it as soon as you've entered it into your books. Keep it near your computer, easily accessible.
• Keep BOOKS. Just like a business, keep books of your finances and input your data by hand rather than downloading from your bank and other financial institutions. That way, you become aware of bad spending habits, notice trends, etc. There are several bookkeeping programs for individuals.
• BALANCE your books monthly. You can get your statements electronically or the old fashioned way, but keep them, they are valuable legal documents.
• Create and stick to a BUDGET. Review your income and spending for several months to establish a base line and note trouble spots, then create a budget you can live with. You will need to tweak it as you go, but become serious about staying on a budget.
• Set up an EMERGENCY FUND. Build it with regular installments you have budgeted, then only use it for emergencies.
• INVEST in your future. Even small amounts faithfully invested over the years can create a sizable nest egg. Please note I do not get paid for your hits, ads etc. All advice is just my opinion. I was a Registered Independent Investment Adviser, qualified through the SEC for over 20 years. Here are some ways to get started:
• Buy little pieces of high end stocks, see a video here.
• Buy no-load or very low load Mutual Funds. A load is a fee when buying the investment. Here is a chart of some funds with low minimums.
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