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5 Signs That It’s Time to Change Your Budgeting Strategy

By U.S. News & World Report

Starting a new job, getting married and many other life events will change your financial situation. If you aren’t keeping an eye on your budget through these moments, you could be missing opportunities to improve your finances with additional savings or investment. Worse, you might be risking your financial health by tacking on additional debt and forgoing saving and investment altogether. It’s easy lose track of budgeting when so much is happening in our lives. Resist that temptation and let those times be reminders to watch for signs that your budget strategy may need a change.

[See: 8 Big Budgeting Blunders — and How to Fix Them.]

1. Credit card balances start creeping up. When used responsibly, credit cards are a convenient way to make large and small purchases. Even better, a rewards credit card can shave a few cents off every purchase — or add up to free travel and other goods and services. However, if you notice that you’re using the card to delay payment, especially over several months, it’s time to reevaluate your budget. Those delayed payments mean interest charges, which will put a crimp in an already tight budget. The strategy here is twofold. First, look at your budget and see where you can make changes to accommodate the spending you’re putting on your card. Next, look at your spending habits. Can you wait until you have the cash saved to make these purchases? If the answer is yes, decide to delay purchase rather than delay payment.

[See: 12 Habits of Phenomenally Frugal Families.]

2. Your monthly expenses have changed significantly. If you’ve just made the jump from renting to owning a home or purchased a new car, other parts of your budget are going to have to shift, too. Make sure to review your budget closely and list all the new expenses for your new lifestyle. For example, on top of the monthly mortgage on your new home, your budget should include room for monthly maintenance costs, taxes and insurance. If you bought a new car, you’ll need to factor in insurance costs (likely higher than those costs for your old car) and other fees, such as increased annual DMV fees, that come with that new car smell. The point is that hidden, ongoing costs from major purchases often sneak into our check registers and credit card statements without making it into our budgets. Whenever you make a major purchase, make sure your budget accounts for it — all of it.

3. You reached your financial goals months ago. It’s not just bad news and big spending that demand a budget rethink. Whether you managed to enjoy that dream vacation you saved up for during the past few years or maxed out your annual individual retirement account contribution a few months early, you — and your budget — need to make some adjustments. Revisit your goals. Is it time to start saving for another dream vacation? Maybe it’s time to set up an investment account outside of your IRA. Or maybe now is the time to make the renovations and upgrades to your home that you have been putting off. A budget is a great tool to help us reach financial goals — just make sure you have sound financial goals to pursue.

[See: 10 Foolproof Ways to Reach Your Money Goals.]

4. You still haven’t reached your financial goals. On the other hand, if you haven’t yet topped off your IRA, or if your emergency fund is still a little short, your budget may be at fault. A close look at your budget, and your spending, can tell you where your money is going and why you aren’t reaching your goals. Are you spending more than you planned on housing, entertainment or food? If so, is it because you’re splurging, or are the cost increases out of your control? Also, analyze your budget carefully and make sure you’re reporting your income and expenses accurately. Once you know where the money is going — and that your numbers are correct — you can begin to set your finances back on course.

5. You’re always anxious about money. Nobody is immune to worrying about money, but if you sense that you’re feeling extra worried about your finances, you might have lost confidence in your budget — if you have one at all. Combat that worry with cold, hard financial facts. Clearly assess your financial situation. Sum up your assets and liabilities, add up your income and total your expenses. When you have the numbers, give yourself a goal. Maybe it’s to eliminate debt. Maybe it’s to increase retirement savings. Now that you have some facts in hand and a goal in sight, build a budget that works for you — and gives you some peace of mind.

More from U.S. News

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12 Shopping Tricks to Keep You Under Budget

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5 Signs That It’s Time to Change Your Budgeting Strategy originally appeared on usnews.com

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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