Author: Jenny Smedra

5 Smart Ways to Use a Credit Card When You’re Unemployed

Smart Ways to Use a Credit Card When You're Unemployed

During times when people are unemployed or underemployed, they often rely on credit cards to cover their basic expenses. Unfortunately, the high-interest rates and accruing balances can compound financial difficulties. While many people avoid credit cards at these times, there are ways you can use them to your advantage. Here are 3 smart ways to use a credit card when you’re unemployed.

The Financial Struggles of the Unemployed

If you have never been unemployed, consider yourself among the fortunate few. However, the rest of us already have or will face unemployment at some point in our careers. There are several reasons why this happens, many of which are beyond your control.

Whatever the circumstances leading up to unemployment, it’s important to carefully manage your expenses during this time. Even if you have an emergency fund or savings, you can quickly blow through money. And with the current inflation rate and increases in the cost of living, it is even more difficult to stretch your financial resources.

It’s easy to become overwhelmed as expenses pile up and you worry about paying your bills, accruing debt, and keeping food on the table. And the longer it takes to find steady income, the worse it becomes. In addition to the job search, I found myself constantly scrapping to find temporary work or bring in income through side gigs. Not having a safety net or health insurance added another layer of pressure to an already difficult situation.

5 Smart Ways to Use a Credit Card When You’re Unemployed

When there are no other options, many people turn to credit cards to help them through hard times. However, this can be both a blessing and a curse depending on how responsible you are with your finances. While you should do everything possible from accumulating more debt, here are 5 smart ways to use a credit card when you’re unemployed.

1. Take advantage of introductory offers with 0% APR.

Many credit cards entice new customers with introductory offers for 0% APR. Although some only offer it for a few months, others extend the rate for 18 months or more. Taking advantage of these offers can provide a grace period that allows you to pay your bills without the added interest fees.

But, it won’t last forever. When the offer ends, the high interest rates will kick in. It could be more damaging if you can’t pay off the balance before the offer period ends. Therefore, you should only use it as a backup emergency fund and be cautious with your spending so you don’t end up with a mountain of credit card debt.

2. Look for balance transfer offers to save you money.

In addition to the introductory offer, some credit cards also include the added benefit of no balance transfer fees. This feature allows you to save on interest fees if you transfer your credit card debt to the new account.

If you’re smart and stay ahead of the expiration dates, you can transfer the balance again before the offer expires. However, this can be a risky game if you don’t get approval or can’t transfer the entire balance. When this happens, it will leave you paying off the rest at the fixed rate.

3. Choose one with a lower interest rate.

Unfortunately, you may have no other option but to use a credit card to pay your bills. However, the one you choose can make a big difference in your finances.

Take time to review the terms of your current credit cards. Compare the interest rates, credit limits, and fees. You can save a significant amount when you utilize ones that have lower fees. Reading the fine print and choosing the best credit for you can reduce how much debt you accrue when you don’t have a steady income.

4. Set spending limits or use prepaid credit cards.

Those who have trouble controlling their spending may need to take more drastic measures to protect themselves. If you find it impossible to resist the temptation to swipe your card for every expense, then you should consider putting a spending limit on your account.

Another alternative is to use a prepaid credit card. If you are living on a strict budget, you can load money onto the card at the beginning of the month and use it to pay for your expenses. However, once you reach a zero balance, you won’t be able to use the card until you reload it.

Both options will prevent you from accruing more debt and help you stick to your budget.

5. Redeem your rewards.

Many credit cards offer rewards programs that will earn you cashback or points on every dollar you spend. While this isn’t an excuse to rack up more charges, you may already have some rewards available to redeem.

Each card operates within a different structure. Each one has its own terms for how to use and redeem your rewards. If you go with the cashback option, they may send you a check or offer a statement credit. Others allow you to redeem your points for gift cards and other travel perks. So if you have been saving your rewards for a rainy day, this would be a great time to use those rewards to reduce your expenses.

The Hard Truth About Debt

While everyone hopes to stay debt-free, it isn’t always an option. At times, debt is inevitable, especially when you are between jobs. However, credit cards should be a last resort to help cover the essentials until you start earning a steady income again.

It’s best to consider all your options before turning to credit cards for all your expenses. And if you are using them, you need to make sure you are at least making the minimum payments. Otherwise, it could affect your credit score, put your account into default, or force you to deal with collection agencies.

If you must use a credit card when you’re unemployed, contact your lenders to inform them of the change in your job status. They will be more willing to work with you if they have advance notice of late payments. It’s also possible that they may lower or defer payments as well as waive penalties. Many credit card companies also have payment programs during periods of hardship. Although people hesitate to make the call,  it may surprise you to learn how understanding and helpful they are when dealing with financial difficulties.

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How to Sell a Home Without a Realtor

In today’s market, some homeowners are opting to sell a home without a realtor. Since listing agents usually take 3% commission, choosing to do it on your own can save you a lot of money. If you decide to sell without a listing agent, it is what realtors call ‘for sale by owner,’ or ‘FSBO’ for short. Thanks to numerous listing platforms, it is now easier than ever to get a good price without using a realtor to sell your home. Here’s what you need to know if you will be acting as your own agent.

1. Prepare It for Potential Buyers

Before you allow anyone into your home, you should take some time to de-clutter and remove personal elements. Take those family photos and personal items out of view so buyers can see themselves in the space. This is also a great time to get rid of items you don’t use or need anymore.

Once you have organized your belongings, it is time to scrub the house from top to bottom and make necessary repairs. You may also want to ask for a second opinion from someone with real estate experience. And don’t forget the exterior curb appeal. The more inviting your home is, the better your chances for a quick sale.

2. Do Your Research

Once your home is ready for the market, look at the listing prices of homes in your neighborhood. A quick comparison will give you an idea of a realistic asking price. Look for homes with similar finished square footage, number of bed and baths, and lot size. If you are still uncertain what your home is worth, this handy tool can help you. The HPI calculator from the Federal Housing Finance Agency can give you a better estimate to get the most out of your home.

3. Post Your Listing

The next step is to compile all the information you will need to create your listing. Include quantitative data that is pertinent to buyers. Be sure to list the year your home was built, finished and total square footage, lot size, number of bed and baths, and relative details that make it more appealing to buyers.

In addition to the home data, take photos of every room and exterior areas. You want to emphasize natural light and sweeping views of the spaces. For the best results, use editing software for higher quality pictures. Finally, add an enticing description to grab potential buyers’ attention. Once you have gathered all the data, you are ready to post your listing.

4. Advertise Everywhere

The best way to sell a home without a realtor is to get the word out. There are dozens of ways to reach homebuyers, especially in the age of the internet. Multiple listing services (MLS) offer an extensive database that connects brokers, homebuyers, and sellers. It is an easy and cost-effective way to get widespread exposure. You should also consider other real estate sites such as FSBO.com, Zillow, and Trulia where you can post listings for little to no cost.

Another option is to use local classifieds like Craigslist and Nextdoor which receive tons of internet traffic. For a more personal touch, you can create a virtual walk through with YouTube, or host a dedicated website. Don’t forget to advertise locally in papers and around your neighborhood. Never underestimate the power of social media, mass emails, and flyers to create a buzz and get people interested in your home.

5. Host an Open House

Once your home hits the market, an open house is an excellent way to attract a large number of people and competition. Before you set the date, visit other open houses and take notes of what people respond to. Then, create a sales sheet for homebuyers to take with them and review later.

Try to schedule it on weekends when more people are available. The late morning or early afternoon are usually the best times to hold an open house. Make sure both you and your home look their best. You want to make a good impression and be the perfect host to help you sell a home without a realtor.

6. Show Your Home

While you are selling your home, you must be ready for walk-throughs. Agents will contact you and usually ask that you are out of the house so as not to make potential buyers uncomfortable. You will usually have enough time to ensure you can have your home spotless for their visit. It is also a good idea to prepare spare keys in a lockbox with a basic multi-code lock for agents. Attention to details makes walk-throughs less disruptive and problematic.

7. Field and Negotiate Offers

It is also a good idea to brush up on negotiation strategies and skills. Since you are not using a realtor to sell your home, it will be up to you to handle all offers. However, you are not obliged to respond to insincere or extremely low offers. If time allows, be patient and wait for the right homebuyer to come along.

8. Hire a Professional to Close the Deal

After you have accepted an offer, the final steps require signatures and paperwork. At the very least, you will need an escrow agent to facilitate the process. Real estate laws vary between states, but your agent may be a real estate attorney or title company representative. Your agent will be the main point of contact during the closing process.

Although it is an escrow’s agent job to ensure you are in compliance, you can do your own research. It does not hurt to know the local and state laws governing real estate transactions. If you are still having doubts, consider hiring fee only broker to make sure paperwork is in order. They are significantly cheaper than using a realtor and help prevent anything from jeopardizing or delaying the deal.

Final Thoughts

Selling your home will be one of the largest and most complex financial transactions in your life. If you choose to sell a home without a realtor, you will save a lot of money. However, you will also be giving up many conveniences and sacrificing a lot of your time. Make sure you understand the complexities of selling your home and that you are up for the challenge.  It may be a huge commitment, but your dedication could be rewarded with huge payouts.

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20 Things You Should Never Buy Even If You Have the Money

20 Things You Should Never Buy Even If You Have Money

You can learn a lot about people by their spending habits. What they spend their money on will tell a lot. However, sometimes it’s more revealing what people won’t spend their money on. Based on thousands of answers across the internet, here are 20 things most people say you should never buy, even if you have money.

20 Things You Should Never Buy Even If You Have the Money

1. Designer Baby Clothes

Items with designer labels can cost hundreds of dollars. Therefore, buying designer baby clothes doesn’t make much sense since they will outgrow them in a few months. Some may argue that it is worth investing in quality clothing. But if you can only use the item for a few months, then you are wasting your money.

2. High-Fashion Couture

Although I do own some name-brand clothing, high-fashion couture is an entirely different animal. Not only is it expensive, but it’s often uncomfortable, impractical, and overpriced. You can still find trendy, high-quality items for a fraction of the cost. Finding well-made items that you can wear again and again are better for your wallet and long-term savings plan.

3. Diamonds

They say diamonds are a girl’s best friend. But these days, I would prefer to find cheaper, ethically sourced alternatives that are much more affordable. Not only are they just as beautiful, but most people can’t tell the difference without closer inspection. Save yourself the money and put it to use somewhere else in your budget.

4. Oversized Mansions

Many people have the hope of owning a nice home. But, there is a difference between a large home and an oversized mansion. Who needs 20 bedrooms or a 24-car garage? And, can you imagine how much it would cost to maintain a residence that big? Most of us would prefer something that is more liveable and less of a budgetary strain.

5. High-end Sports Cars

For some people, a high-end sports car is the ultimate sign of success. However, you could spend a million dollars for a new Ferrari or Lamborgini just to have it depreciate as soon as you drive it off the lot. Market research shows that these cars lose 10% of their value in the first month and 20% in the first year. Furthermore, they are expensive to maintain and repair. While some may be planning to buy their dream car, there are more practical and financially beneficial ways you could enjoy this kind of money.

6. Yachts

Yachts and mega-yachts are another status symbol of the ultra-rich. Unless you are living on one, they are usually another wasteful expenditure that rarely gets used. Like luxury sports cars, they are costly to maintain and serve no practical purpose.

7. Edible Gold

You may have heard of this fad because it’s so hard to believe. But sometimes fact is stranger than fiction. Indeed, some restaurants feature dishes made with edible gold. But at $15,000 a pound, it hardly seems worth the price. No matter how delectable the dish is, no food is worth its weight in gold.

8. Exotic Pets

You will see many of the rich and famous with exotic pets. Unfortunately, these animals are often the result of poaching or have come from facilities that don’t properly care for their animals. Some only breed them for profit while others are guilty of mistreating the animals in their care. Therefore, exotic pets are among the things you should never buy since your money could be supporting their illegal and inhumane activities.

9. Lavish Weddings

Your wedding is one of the most important days of your life. However, the days of going overboard may be over. A lavish wedding is a huge and unnecessary expense, especially when a couple is just starting their life together. Instead of starting in debt, the money could be better spent on a down payment for a house or other assets that could make them more financially stable.

10. Overpriced Alcohol

Some people invest in fine wine or expensive alcohol. Certain bottles can bring good returns in time. However, most alcohol over $60 has diminishing returns. So if you’re buying for personal consumption, why not pay less for something that tastes just as good?

11. Timeshares

A timeshare may be perfect for family getaways. But, what do you do when you can’t use it during your specified time? And how long will it take to find a buyer when the time comes? Most owners would tell you to skip the headache because timeshares are one of those things you should never buy. It may be wiser to opt for a hotel or vacation rental instead.

12. Extended Warranties

Purchasing an extended warranty may seem smart in theory. However, they usually come with a high price tag and won’t always cover everything that could go wrong. Since most of us will never use them anyway, you may as well skip the extended warranty and bypass another cost that rarely offers any return.

13. DVDs

Be honest…when was the last time you watched a DVD? Although many of us used to have them, nowadays most people watch movies through their streaming services. And even if you can’t find what you’re looking for, you can purchase one-time rentals to stream.  It may be worthwhile to keep your favorites, but giving up DVDs could save you money and storage space.

14. New Tech on the Release Date

Many loyal customers line up to be the first to have the latest tech. But in reality, the new releases are usually overpriced and under-tested technology. And, it will probably be upgraded and available at a reduced price within a year. So, it may be a better financial move to wait for the improved features or buy older tech on the new release dates.

15. Greeting Cards

With graduation and wedding season coming up, it’s time to stock up on greeting cards. But, I’m always taken aback when I get to the register and find out they are $5 each. To save money, I either buy them in bulk or look for deals at the dollar store. And better yet, making them yourself or sending an e-card is free. So, why waste money on things you should never buy when there are cheaper and more personal options available?

16. Premium Gas

Gearheads and mechanics may disagree, but you don’t need to spend more for premium gas. Your car manual may recommend premium gas. But, the average car will still run efficiently on regular gas without damaging the engine.

17. Bottled Water

Some of my friends and family members buy bottled water for convenience. I’ve also had others tell me that bottled mineral water is better for your health. However, studies show that 64% of bottled water is just regular tap water. Using a filter or reusable bottle is not only cheaper, but also better for the environment.

18. Name-brand Pharmaceuticals

Unfortunately, this may not be an option for some medications. But when there are alternatives, name-brand pharmaceuticals are one of the things you should never buy. This can save you a ton of money if you have regular prescriptions to fill. However, you will likely find the best deals with over-the-counter medicines. If you aren’t sure, you can always ask your pharmacist to guarantee you are buying the equivalent product.

19. Specialized Kitchen Gadgets

If you spend a lot of time in the kitchen, you should invest in a quality set of knives and cookware. You may even have some handy gadgets that make food prep easier. But items from the houseware catalogs and specialty stores aren’t worth your money. Unless it is something you will use regularly, these gadgets are another expense you don’t need.

20. Cardboard Boxes

People used to pay for cardboard boxes when they needed to ship something or move. But thanks to Amazon, most of us now have an overabundance of boxes. Instead of spending your money when you need more, track down free boxes from local supermarkets, recycling centers, or other stores in your area.

What do you think are things that you should never buy even if you have money? Share your thoughts below!

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