Spending more than you earn is the quickest way to get into financial stress, Lets say for example your take home pay is $4,000 a month but you actually spend $4,800. You ask how? Credit card debt, that’s how! Spending more than you earn is common & so easily done that you may not even realize your doing it until your credit card repayments start getting more than you can afford, and then you find yourself in financial trouble.

It can be very stressful at the end of the month when you try to divvy up your pay. You will have to put off what you can, go without, get an extension, part pay, run the petrol tank lean, go without lunch, eat the cupboard bear and often end up borrowing money to get you through to next pay packet.

The people that have been through this and survived know how important it is to “live within your means”. It usually only takes one bad experience of financial stress to never want to experience it again. It’s horrid, your whole world comes to a halt economically and you’re forced to have embarrassing conversations with telephone operators of utility companies, banks and landlords.

Some great financial tips to stop this happening are:

• Know how much you take home a month. Regardless of whether you’re paid weekly, fortnightly or monthly you can need to know what you take home in real dollars $. If your income is variable, look back over the last 6 months and calculate an average monthly take home pay.
• Know what your total monthly expenses are and know your debt. If you need a budget planner, here is one that I used and found it to be comprehensive, Click here for budget planner
• Know what you bottom line is. Subtract all your monthly financial commitments from your monthly take home pay and that is your bottom line. If you have money left over at the end of the month then you are “living within your means”. If you have no Gap then you must evaluate where you can make adjustments and reduce spending in non critical areas. Often you can workout needs versus wants.
• Know what your wants and needs are. It takes discipline and strength of character to put on hold your “wants”. For a while whilst you get under financial control, just go with what you need.

Getting back to a positive gap takes time but it is achievable, you get good at budgeting, good at saying “no” and believe it or not you do feel a sense of accomplishment. Its tough being frugal, no one likes it but if your in a position that you cant afford you will need to go through a little pain to get to pleasure by having your finances under control.

Warren Edward Buffett; born August 30, 1930, is an American business magnate, investor and philanthropist. He was the most successful investor of the 20th century. He has 6 good financial tips that we can all use and adopt into our life.

• On Earnings – Never depend on single income. Make investments to create a second source.
• On spending – If you buy things your don’t need, soon you will have to sell thing you do need.
• On Savings – Do not save what is left after spending, but spend what is left after saving.
• On taking risks – Never test the depth of the water with both feet.
• On Investments – Never put all your eggs in the one basket.
• On expectation – Honesty is an expensive gift. Do not expect it from cheap people.

I think you would agree that if you adopt these strategies for your financial well-being, it is hard to go wrong.

Today it’s becoming far more common for parents in Australia to help their adult children buy their first home. Many young couples are turning to this option since breaking into the market is more difficult than it was in the past. There are actually several ways that parents are assisting their kids make this major step, and they are each becoming more common in Australian society.

Housing prices are increasing, as are parent loans:

Housing prices arerising at a rate of around 10% each year and many first-time buyers are feeling the pinch. This increase in prices is consequently making it difficult for young couples to purchase their homes or even make a down-payment. The result? In the past few years, 1 out of 3 first go-around homebuyers received an initial deposit from their parents! This trend is one that appears to be growing throughout Australia. Altogether, Aussie parents are contributing over $100 million annually to help their adult children establish themselves as homeowners.

While one-third of young adults will receive their shove from the nest in the form of a deposit, four-fifths are receiving some sort of financial support with the purchase of their first property. This assistance comes in the form of a home-loan, a loan guarantor or a deposit. Services like 1300 Home Loan are showing an increase by young couples in searches for mortgage brokers and home loan comparisons that refer to parents as guarantors. According to news.com.au, an incredible 80% of first-time home buyers are actually given some sort of financial assistance from mum and dad!

Lending and Giving:

One of the options a parent has is to buy a home for their children in their own name, and entrust it to them later. This way, they maintain control over the property. Eventually, ownership of the property will transfer to their adult children. However, prior to that point in time their son or daughter can live in the property. This strategy helps to protect your investment against potential divorce. At the point of transfer, the capital gains tax is applied.

Parents can also lend or give their children money to help with the purchase of a home. This amount might pay for down payment or be enough to cover the entire property cost. Parents do this at a risk – if the son or daughter’s marriage ends in divorce, some of the family’s estate could be lost.

Another popular option is for parents to treat the payment for the purchase as a loan. This option can help avoid the loss of the expenditure should the marriage be terminated for any reason. For a loan of this nature, it is of utmost importance to make sure necessary paperwork is complete. It may help if the parents maintain some sort of responsibility for the home, say in the form of a mortgage agreement.

It’s important to note that your superannuation is a retirement benefit available when you reach age 65. It may also be available when you meet other conditions. However, it is not for a property purchase for your children.

With the increase in real estate prices, there are many ways that Aussie parents are helping their grown kids get ahead. If this is something you’re considering for your own kids, take the time to look at your options, check out the restrictions, tax considerations, and advantages, and speak to the experts.

Bills are some of the biggest financial strains that people have to deal with week to week. Most people have to deal with more than a few different kinds of utility bills. The biggest problem people have with bills is the fact you cannot really do anything about them. You need your utilities so you need to pay your bills, but there are some methods to lower the amount you are paying week to week. These are the top three you can manage. Every method you take is money in your pocket. Money you need more than they do.

Solar Power

Solar power seems like it wouldn’t be worth it and in the short term it isn’t, however in the long term there are very few better ideas. For the cost of a few simple and basic installations you can get most of your power bill cut off. The government reimburses you for any power the solar generators make and if you make enough you can even turn a small profit. At very least, this will cut your power bill into manageable pieces. A good cost cutting measure if you are willing to go the distance.

Water Tank

A rainwater tank is one of the easiest and most effective cost cutting measures readily available. A simple tank designed to catch any excess rain and run it into your own system, dissolving any external need for washing or drinking water. For the cost of the tank, a water filtration system and the occasional maintenance cost, you can save thousands of dollars in the long term. Water tanks are available in a range of sizes and types that will suit your aesthetic and water supply needs.

Shop Around for Utilities

Water and power and pretty much non-neogotiable, there are only a few water companies and Energex is pretty much the only option for power, but when it comes to other services, PayTV, phone, internet, all of these things are markets and like all markets they are negotiable. They can, with a little research and effort, be reduced. Taking advantage of special offers, playing the companies off against each other and only paying for what you actually use can cut your bills down to something manageable. Get out there and look around, you might find what you need.

Cutting costs is one of the most important things you can do to keep a stable financial situations and keeping your weekly costs down is a big part of that. Taking these steps and a few more will allow you to have a little extra spending money in your pocket every week, or to use your savings to pick up that big luxury purchase down the track. With a little extra thought and effort you can get what you need.

I needed to be completely honest with myself,  I couldn’t hide debt and expect to have a budget that would work.  So I added everything up and didn’t forget to add in the food, beer, petrol, iTunes downloads, books, movies and gifts for the kids.  They are all legitimate and definite expenses for us dads.

If you don’t put them down you will always be short at the end of each month.

Be sure to include your periodical bills too.  Once you have a total of what you feel is everything? go back over your statements, you can normally see 12 months history online.  Look for car servicing, dental work, holidays and items that are not regular but pop up from month to month.  Add them in too.

Add up everything and divide by 12, this will give you a monthly commitment.  Subtract it from your take home pay and you may find you have a shortfall. Many people spend 110% of their salary.

We need to try and cut it back, so this is where we look at prioritizing.  We will not be able to make a budget work by thinking now you can cut back on the second glass of beer or wine at dinner.  Look at significant changes that will mean something and you will feel the benefit such as: Cancel your foxtel subscription, Suspend your Gym membership (many people do) over the summer months, outside exercise is amazing during summer, make your lunch at home and take to work everyday (I save about $300 a month doing this).  Back off your internet usage and reduce your commitment to the provider.  There are other area’s I am sure you can think off too – No better time than to cancel them today.

I’m sure that if there are CPA’s out their that have been through divorce or separation, they will acknowledge it’s challenging keeping finances in order when going through divorce.  Most men enter into separation unprepared and do not realise that having a good financial budget is one of the keys to maintaining positive parenting.  I have posted more on this topic here.

A good BUDGET CALCULATOR to use is located here and it has an online version or an excel version.  I have used the online version as it is very simple and you can save your budget within the site anonymously and refer back to it from time to time.

If you feel you need urgent help to sort out your bills and prepare a budget, you can call 1800 007 007.  This free hotline is open from 9.30am – 4pm Monday to Friday.  When you call the number you will automatically be transferred to the phone service in your state where a financial counsellor will help you.