A Financial Education Event
 

Rent-To-Own: Is It Ever A Good Idea?

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You’ve moved into a new place, started a new job and you’re beginning another phase of your life. The only problem is that you don’t have enough furniture for the new place and you realize you’ll also need a washer/dryer.  Then, miraculously, an ad pops up on social media for a place where you can go get name brand appliances and choose from dozens of options on exactly the kind of furniture you need—all for only $21.99 a month! YEA!!!  You’re saved! After all, you have a good job, the monthly payments aren’t going to break you and you deserve to make your new place comfortable, right?

Wait a minute, not so fast.

Is rent-to-own the best option? The answer is:  it depends.

How Does Rent-to-Own Work?

Usually, you’re renting from a well known store, but, in most cases, you’ll have to sign a third party contract. I remember one time when we bought a refrigerator and my husband thought, “Let’s use someone else’s money at 0% interest.”  The only problem was the third party contract indicated that those 0% payments were only for a fixed introductory period, then there were three options. We could buy the item, continue making payments (at 200% APR interest) or return the item to end our lease. We bought it out early, so that we were in the clear and vowed to never buy into this kind of a contract without understanding the fine print first.

 

Rent-to-own also means that if you fall behind on the payments, the leasing company can repossess your leased item and you don’t get any money back. There may be cheaper ways to pay because even if you have bad credit the options of  layaway, sub-prime credit cards or  bad-credit personal loans, which run 36% APR are better than the 200% APR of many rent-to-own programs.

 

When Is Rent-to-Own A Good Idea?

 

Despite the typical APR rates north of 200% for this kind of contract, there may be some anomalies when this option is not a bad thing for your bottom line. In fact, there are some instances, when using a rent-to-own option make sense:

 

  • If the interest rate stays relatively low (less than 3%) during the entire leasing term, and the term is 24 months or less, then you aren’t losing much. But read the fine print.
  • If you believe you’ll have the money to buy the item outright at the end of the low, fixed rate introductory period, then it could be a good way to keep some money in a rainy day account while you save up for the buy out.
  • If you need to diversify your loans to improve your credit score, and you qualify for low interest, then this kind of financial contract could help your credit score. But since diversification of loans only represents 10% of your credit score, it’s not worth paying higher interest rates to diversify.
  • If you are only in a location for a short amount of time (our sons have military training at bases for anywhere from 3 months to 10 months), and your interest rate is low, you could rent and turn the item back in when you move. But make sure the contract allows you to do so. If you must move yourself and your company doesn’t pay for a move, then renting a truck and moving that furniture cross country could cost more than it’s worth.
  • If you have the good credit score amongst your roommates and you all need to get furniture for the main living areas, then you could work a deal where they use your credit (your contribution) and they pay their part of the monthly payments (their contribution). But make sure the interest rates are low for the entire contract and that you trust your roommates enough to make the payments to you (on time) so that you can make the payment. At the end of the lease, you keep the furniture. This option may be more of a hassle than it’s worth. But if you are cash strapped, it might be just what you need.

 

Before You Sign

Let’s say that you’ve decided that Rent-to-own is the route that will work best for your budget and lifestyle. Here is your checklist before you ink that contract, if any of these are not clear are it’s revealed that they are not to your advantage, then think twice about this option. Here’s the list:

  • What are the monthly payments (including all fees)?
  • When are the payments due?
  • What is the total cost to own this item (all payments, interest and fees)?
  • Who insures damaged or theft?
  • If you miss a payment, will it be automatically repossessed?
  • Is the item new or used?

After You Sign

 

Let’s say you already signed a contract before you read this blog. Or, you’ve followed all the advice shared and decide that the contract will be a good option for you. Take these steps to protect yourself:

 

  • Follow the money. Make sure you are keeping your payment records because some rental companies have had problems with giving their customers credit for payments made.
  • Pay on time. Since 35% of your credit score is your credit history, it’s crucial that you make your payments on time or even before they are due. If possible, set up the payments to transfer from your bank account so that you never miss a payment.
  • There’s a chance your debt might be sold to a debt collector Know your rights in this situation as the Fair Debt Collection Practices Act requires debt collectors from harassing customers, calling them excessively and using abusive or deceptive practices to collect on the debt. 

In the Kay family, we like to live a debt free life and will usually save up to buy furniture or appliances before we would go into debt. This isn’t always possible for American consumers, in which case it’s good to know the nuances of Rent-to-Own for you or those you care about.

What has been YOUR experience with Rent-to-Own?

Driving Cars for Free

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In our Heroes at Home Financial Event Tour, one of the most popular segments deals with “how to drive a car for free.” The concept is fairly simple, but less than 10% of Americans actually follow the steps to experience debt free living when it comes to transportation. We love our military audiences because even though some military members are “ordered” to attend our show, by the time it is over, they are laughing, they’ve learned something and they realize how much fellow Americans loves them.

So how do you do it? Just follow three steps:

  1. Start with a Debt Free Car – This is usually going to be the car you just paid off. Or, it might be a vehicle a parent or someone else gave you (it might even have seen better days). In our lives, we were “given” one car and we gave away 8 cars. It might be that you agree to be a one-car family for 18 months instead of a two-car family. This is how the Kays did it to start with. If you don’t absolutely have to drive a car (you are a one car family, public transportation, driving someone else’s car, etc.), then you can go to step #2.
  1. Pay Yourself – The monthly payment for your car that you used to pay before it was paid off is a payment you will now pay to yourself instead of to the lienholder. So let’s say your car payment was $300. You will pay yourself $300 every month for 18 months. At the end of that time, you take the $5400 you have saved and then sell your existing vehicle for as much as you can get for it. You will get more money for your vehicle if you detail it, get everything running as well as possible (without a huge investment) and then sell it yourself. Go to KBB for 10 steps on how to sell your car yourself.  Let’s say you sell it for $8000. Now you have $13,400 to work with.
  1. Pay Cash for Your Next Car – Follow my steps from my previous blog on Car Buying Dos and Don’ts – Even if you aren’t a USAA member (for an additional military discount), you can still follow the steps listed to pay the least price possible for your next vehicle. Make a special note: You cannot do this with a new car! It has to be a used car. The average new car depreciates $8000 in 8 seconds (when you drive it off the lot). So you have to buy a car that is slightly used (or real used until you trade up). The example in my blog shows how I traded up consistently until I was driving a modest Mercedes. (Is there such a thing as a modest Mercedes? I believe there is).
  1. Trade Up Until You’re Satisfied – After you’re in a new-to-you “paid for” car, then start with step number two all over again and start paying yourself. Let’s say you bought a car for $13,400 and you got into it low (as I showed you how to do in my previous blog), then in only 18 months a used car won’t depreciate that much (if you take care of it and try to keep low mileage on it) and you can sell it for close to what you paid for it. You sell it after 18 months for $13,000 and add the additional $5400 that you have saved by paying yourself every month. Now you have $18,400 going into step #3 and you can trade up your vehicle.

Does this work? It absolutely does. Not only do I do this in my own family, but I have children who do it as well. When my kids ask for my advice (sometimes it’s nice having a mom who is America’s Family Financial Expert ®), I advise them to not be wasting money on expensive car interest payments or crazy expensive leases. The difference is enough money saved over the course of five years to be able to put money down on a house instead of having to rent. It truly adds up!

Keep trading up until you are satisfied with your car and you can trade up into a car with a substantial manufacturer’s warranty (or negotiate that warranty). I do practice what I preach, and I did this to get my 2014 Mercedes, which is under mfg warranty until 2022. The only perceived downside is that my dream car is red and I thought that red cars get more speeding tickets than other colors. But good news! That’s a myth. Pedal to the metal!

What can you do today to drive your cars for free tomorrow? Let me hear from you!

Ellie Kay

Valentines Day

 

Even after 30 years of marriage, Valentines Day is still consider a “high holy day” in the Kay house! If Bob ever lived in a world where he thought he could skip over the day in an effort to “save money” he would end up spending Valentines with Buddy, our mini schnauzer in his dog house! But you don’t have to spend a lot for your gift to mean a lot, here are some ideas that may help.

Is it OK to Scrimp on Valentine’s Day?

For Valentine’s Day, you might feel the need to pull out all the stops, but it’s not necessary. Sure, some people want to celebrate the holiday in a lavish way, but others prefer to go the low-key route. Whether you fit into these descriptions or fall somewhere in the middle, there are a romantic date ideas for Valentine’s Day or the weekend before that suit every budget.

The Least Expensive Way to Spend Feb 14th

After a home-cooked meal, snuggle up with your honey and enjoy a movie night on the cheap. Look for specials at Redbox and get a romantic dramedy plus an action movie to keep both of you happy. If you are an amazon prime member then you have access through your computer or TV to free movies that are not available for free to non-members. You may not even be aware of the freebies offered, so be sure to check them out.

Flower Power

When it comes to flowers, you usually get what you pay for and one way to cut costs is to hand deliver, this can save anywhere from $8 to $20. You could look at GrouponLiving Social for offers such as $20 for $40 worth of flowers with FTD.

One kind of fun option reminds me of one of my favorite romantic comedies, “Kate and Leopold” and that is to give flowers with specific meanings. Go to TheFlowerExpert.com to find out the meaning of different flowers. For example, red roses mean romantic love while a bouquet of mixed roses means “I don’t know my feelings about you yet, but I’m sending you roses anyway.” Carnations are a less expensive option and a red carnation conveys love pride, beauty and admiration. Daisys are also inexpensive and convey “loyal love.” A sunflower symbolizes pure thoughts. So you can select a cheaper flower if, and only if, you write a note explaining the meaning of the flower and why you chose it for your true love.

Dinner and a Show

Going out for dinner seems to be a Valentine’s Day mainstay and dinner for two can range anywhere from $20 to $200 or more. How to you have a nice meal without sending a signal to your mate that you want to spend as little as possible? After all, aren’t they worth a splurge on Valentine’s Day?

There are quite a few ways to save a lot in this area and still have a nice time together. Lunch or brunch can be half the price of dinner and you could go on the Sunday before the big day. In fact, some restaurants are offering prix fix menus for the weekend or entire Valentine week. Go to your favorite restaurant’s twitter or facebook page and see what specials they are offering to get the best value. Some of these values are only offered to social media friends.

You can also go to restaurant.com where gift certificates have gone on sale this week. You can get a $25 gift certificate for your favorite restaurant for as little as $6 by entering the coupon code found at RetailMeNot. Check community billboards at your local chamber of commerce website. For example, in our area, a local Greek center is offering a romantic, candlelight dinner for two with champagne, flowers, dinner and dancing for $50 a person. While this may not seem like a bargain at first, when you add up the cost of the individual items like the food, flowers, bottle of bubbly and a cover charge you would have to pay to dance, it’s an all inclusive deal that is sure to please. Plus, you can learn how to dance the Kalamatianos, a traditional Greek dance. Can you say, “My Big Fat Greek Wedding!”?

Great Dates that Double As A Great Gift

Right now, there are some great deals to be had at Travelzoo such as a quick, 2 night getaway on a $299 cruise, with an oceanview room. Bob and I took a cruise this way and really loved it. This week, there are also really nice hotels from Orlando to Seattle that range from $49 to $99 a night. Or, if you want to get up, up and away, there’s a $125 two hour helicopter ride featured.

Ellie Kay

America’s Family Financial Expert (R)

Top Ten Failure Factors for Finances

Welcome to Top Ten Tuesday. Only 1 day left in January! By now, it seems that most of our New Year’s resolutions have lost some steam, been pushed to
the side, or just been dropped all together.

It is never too late to reevaluate our goals and start over. We don’t need to wait until the next January 1st to get our finances under control. When we fall off the wagon, it is best to get up and keep going. I like to imagine the young Anne of Avonlea saying, “Isn’t it nice that tomorrow is a new day with no mistakes in it?”

If we understand what derails us from achieving our goals, then we can counter those failure factors and find success. These are the top ten failure factors that impact the achievement of a goal. Read them slowly and think about what they mean in your recent resolutions.

Top Ten Failure Factors:

•   Setting unrealistic goals

•   Motivated by the wrong motives

•   Believed failure was inevitable

•   Fulfilled the need for immediate gratification too often

•   Influenced unduly by other people

•   Practiced a “deprivation mentality”  – all or nothing/black or white

•   Rationalized and made excuses rather than taking responsibility

•   Displaced emotional issues through overspending and overeating

•   Procrastinated rather than taking action

•   Lacked the tools to make compounding incremental change

Reread the list above and circle any of the “failure factors” which you believe may be significant influences in your life. Failure can be seen as a profound learning opportunity. It’s time to stop trying so hard and start training toward a new way of addressing your wealth challenges. Past failures do not need to be repeated. Before my husband and I met, he was in a debt cycle he felt would never change & financial

freedom was just a dream. But it did change because we set goals and took action. The result? We’ve been debt free for 20+ years.

After you circle the “failure factors” that may apply to your situation, take the time to write three ways you believe you can counter those factors and turn them into successful areas of your life. I believe in the old saying from John L. Beckley “people don’t plan to fail, they just fail to plan.” Having a plan can be over half the battle in discovering ways to be successful in your finances. But implementing that plan is the other half of finding success.

One of the ways that I have found most people can create and stick to a plan is by having a “money buddy.”  If you are married, this might be your partner, and if you are single, it can be a like-minded friend who is good with their own financial resources. Get together with your money buddy and go over this “failure factor” list. Let them help you come up with ways that you can counter the failure to turn it into success. Then, set a date to meet with your financial partner and track your success. It’s kind of like Weight Watchers for money matters and there is great power in unity with other like-minded people who want to overcome their own failure factors.

For great budgeting tools, go to mint.com—an excellent app for managing finances. Keep checking in week to week for help along the way. You are not alone in this financial journey! You can find success if you: Dream Big. Set Goals. Take Action

Smart Money Habits for Millennials (and Their Mamas)

The Kay Family had five babies in seven years. That roughly adds up to 3 kids in diapers at once, 10 years of not sleeping through the night, 4 teenage drivers at the same time, 3 kids in college at once and today, we have 5 millennials in their 20’s simultaneously.

Fun .

But the good news is that they eventually slept, pottied, drove, graduated and even mastered money habits in the journey. Here are the habits we helped teach our millennials to make sure they didn’t have to move home, they could remain financially independent, have a great start for their families, and still buy their mama nice birthday gifts.

Habit #1 – Create and Live By a Spending Plan

Many millennials have heard of the value of creating a budget and even have apps that help. But it’s of little use if they don’t know how to stick to it. Here are my favorite apps to help:

  • Mint Budgeting App – I met the founder of Mint, Aaron Patzer, in a green room, years ago, when we were both going to be on ABC News in NYC. At the time, he was building his success with Mint. I just remember him being (as he says in the video) “full of myself.” Ha! But his budgeting app is probably the best out there because it makes it easy to create a budget. You connect the Mint app to your bank and the app uses your details to help create a personalized budget.
  • PocketGuard Budget App – This app also connects to your bank accounts and shows you what you currently have in your pocket. It tracks your money to show what you are spending and automates where you’re going off budget and where you need to cut back.
  • You Need a Budget – This app’s claim to fame is that it creates a budget you can stick to based on the info provided in your bank accounts and spending habits. It even teaches you what to do if you overspend and how to live on last month’s income. This is the only app that cost money in my list and it’s $50 for the year, but there are hoards of devotees that say this app helped them to finally live on a budget.
  • GoodBudget – Back when dinosaurs roamed the financial space, there was an “envelope system” where you put the money you needed in each envelope labeled with expenses such as gas, food and entertainment. It helped Bob and I get out of 40K in consumer debt in only 2.5 years when we were first married. This app is the digital version of that system, making sure that everyone knows how much is left in the “envelope.”

You might need a money buddy to stay on track, too. Tiffany Aliche, The Budgetnista, talks about her journey on our fun podcast The Money Millhouse and how she went from broke to anything-but-broke through techniques that kept her on track.

Habit #2 – Cook Creatively and Consistently

Money evaporates when you order out for lunch or dinner more than one or two meals a week. Bob took leftover dinners (the

re’s a microwave and fridge at work) for our entire marriage and we calculate that he’s saved $20,000 by doing this! Make Pintrist your pal or watch The Food Network to learn easy ways to create nutritious and tasty meals. Ask for an Instant Pot for your next birthday and make more than you need for dinner so you’ll have leftovers for either lunch or dinner later in the week. Or freeze the leftovers. My daughter lived with roommates for a few years and they would assign different nights for each of them to cook to simplify the work. Cook more and your wallet and your waistline will thank you.

Habit #3 – Care About Your Retirement

When we take our Heroes At Home Financial Event on the road, we teach young service members the miracle of compounding interest with the mantra: start early, start small and stay committed. Be sure to start with funding a Roth IRA and take advantage of your company’s matching portion of your 401(k). Lacey Langford, an Accredited Financial Counselor gave some great tips on a segment called “I Aint Afraid of No Money.”  She discussed retirement planning from her experience in working with the military (but many tips apply to civilians as well.) If you’re military, be sure to go into your Family Readiness Center to discuss the Blended Retirement System and what your options are for your situation. It’s free and a benefit you can use early and often.

Habit #4 – Count the Cost of Debt

The average millennial college grad owes 37K in student loan debt and the average household owes $8500 in credit card debt. Work on minimizing the debt you accrue and pay off the debt you have so that you’ll have the flexibility to move or wait on the right job. One of my sons worked for JC Penney, and they eliminated his entire department. Most employees were freaking out because they had student loan debt, consumer debt and car debt—but not our son. He made a practice of living on less so he wouldn’t accrue debt and he was able to have less worry in the process of finding a new job.

Be sure you also pay attention to your credit score. Rod Griffin, from Experian, came over for a discussion on coffee and credit. He works with us on our tours and he teaches that if you have bad credit, you’ll pay an average of 360K more (over your lifetime) for the use of basic credit, than the person who has a good score. Improve your score by paying on time, paying more than the minimum balance due and make sure you never use more than 30% of your available credit.

Habit #5 – Choose Contentment

This is a tricky habit because it’s a mindset that you choose. There will always be something to spend money on to make you go off budget or get into financial trouble. There’s the new phone, tablet, car, vacay, boyfriend/girlfriend, baby, or a plethora of other reasons to want to spend more and have more. This is where your friends, family and even faith come into play. Coveting what others have or do is a lesson in futility and discontentment. Your friends either contribute to this mindset or they keep you focused on what matters most. If keeping up with their lifestyle is an important platform in your friendship, then you may want to find new friends. Remember that this financial journey is a marathon not a sprint. I’ve always said, “you can have it all—just not at the same time.”

What is one habit you are good at? What is one habit you want to improve upon? Share it with us, a friend or even a money buddy, so that you can be fiscally healthy in 2018 and for a lifetime.

 

New Year Savings Habits

You are what you think! That’s what positive thinking gurus tell us and I believe it to a certain extent. But thinking it without doing something about it isn’t going to help you develop better money habits. In this New Year, I’m challenging you to implement some really easy money savings habits. Let me know which of these that: 1) you already do and 2) you are going to start doing or 3) you ain’t ever gonna do, no way, no how!

PRICE MATCHING—ASK YOUR STORE

If you have a store that will match competitors’ ads, then this helps save time and money. Most Walmart stores offer this benefit to their consumers. This price-matching tip is also good outside of the grocery area because there are dozens of other stores that will honor competitors’ ads, including Best Buy, Office Depot, Staples, the military exchanges, and more. Since these policies vary from year to year (and even month to month), it’s important to inquire at the customer service desk before you try to use the price-matching benefit.

To implement this tip, just take in all the local sale ads and have the store match the sale price from the circulars, or pull them up on your phone. There may be some restrictions, so be sure you ask for the details at the customer service desk. For example, Walmart will not honor a “buy one/get one free,” nor will they honor “percentage off” sales. But they will substitute their brand for other store brands that are on sale and it may even end up being a better-quality deal!

 

SEARCH HIGH AND LOW FOR BARGAINS

In today’s grocery stores, many bargains are located on the top and bottom shelves. The expensive items are at eye level. To those in marketing, the reason is obvious—you’ll buy something that’s in front of your nose! Also, avoid the floral, deli, and bakery departments. They’re usually overpriced and can bust your budget.

 

USE A SHOPPING LIST—DON’T LEAVE HOME WITHOUT IT!

When shopping, you should never leave home without an organized list. It minimizes time spent in the store and helps you stay on target, thus avoiding impulse buying. It can also serve as a reminder of sale prices and coupons you may have. When I first started saving money with coupons and sales, there were only flyers and paper coupons. Flipp is an app that combines the best of old and new by providing a digital library of all the latest flyers and help you build a shopping list within the app. Just tap on a digitized coupon or product and the app will circle it and add it to your digital grocery list.

 

SAVE ON TRAVEL

My crafty little informant over at Hopper just gave me the 2018 Travel Cheat Sheet telling you when the best time to buy is for those 2018 trips. It gives fantastic insider tips, for example:

  • When to buy airfare for major US holidays
    • President’s Day: Book by Monday, January 29
    • Easter: Book by Sunday, February 18
    • Fourth of July: Book by Wednesday, June 13
  • Top 10 domestic and international destinations to watch in January for the best deals:
    • Los Angeles: Round-trip flight prices currently average $328, but are expected to drop 43% this month.
    • Las Vegas: Round-trip flight prices currently average $178, but are expected to drop 28% this month.
    • Cartagena, Colombia: Round-trip flight prices currently average $354, but are expected to drop 35% this month.
    • Lisbon, Portugal: Round-trip flight prices currently average $622, but are expectedto drop 32% this month.

If you’re wanting to read more about saving money on travel, check out Wanderlust For Less, an upbeat look at ways to save money on travel AND still pay the light bill.

COUPON APPS AND WEBSITES

My son, Jonathan, gave me his back-

 

to-school-for-the-spring-semester wish list. He had a gorgeous item that was a pair of shoes at the Bostonian website. The first thing I did was look up the online site in RetailMeNot. Instantly, I got a coupon for 25% off the exact shoes Jonathan wanted. That’s something that made both of us happy.

Coupon Sherpa and CouponMom are also user friendly apps to help you find great values at your local store. Download these apps and use them regularly to save 30 percent or more. Both use geographic location or zip codes to target deals at stores near you. You may also want to try the Redlaser app, it can be used to scan the bar code of a product and find out if the item is cheaper elsewhere.

Don’t forget to listen to my quirky, sometimes geeky co-host, Bethany Bayless and myself on our new podcast called The Money Millhouse. We’ve give lots of tips after drinking lots of coffee and have some of the best financial guests in America on our show! 

Remember to let you know what you are already doing, what you’re gonna do and what you ain’t gonna ever do to save money in 2018!

Thanksgiving Traditions

Thankful Traditions

The Kay family photo for Woman’s Day magazine.

Not every “savings” can be measured in dollars and cents. One of the things we emphasized in our family is the saving of memories. Our Thankful Tree was featured in a Woman’s Day magazine one year. It took two photographers 8 rolls of film and four hours to get one 3 x 5 photo in the magazine. Joshua was missing for one roll of film and we didn’t notice until we saw him making faces from behindthe photographers and we asked, “What are you doing back there?”

The tip we gave is how we’ve stayed in touch with family and friends during this holiday. On November 1st, we made a Thankful Tree on poster board and put it on our wall or front door. The tree was bare because the leaves that we made out of construction paper have not yet been gathered. The leaves have the person’s name on them and say, “Papa is thankful for _________.” But we left the tree bare at the beginning of the season to teach the children how barren our lives are without the giving of thanks.

We made and sent the leaves to friends and family around the world along with a self-addressed envelope. When these envelopes came back, the children got excited as they took turns opening them. At dinner that night, we read the leaf and give thanks along with those who are thankful and put the leaf on our tree. By Thanksgiving Day, we had a tree full of thanks. We carefully saved the leaves in an envelope marked by the year and kept all in our Thanksgiving decoration box. Each year, we read the leaves from past years.

We never know when this year’s leaf might be someone’s last, or which family might have a new leaf on next year’s tree. So we give thanks.  These days, we gather “thankful comments” from facebook, email and twitter, but the point is we are connecting with friends and family in a meaningful way.

This holiday, what are YOU thankful for?  Besides our health and our family, we are thankful for two weddings this year, healthy grandchildren, and the chance to be together during the holidays.

Happy Thanksgiving!

Ellie Kay

 

Holiday Travel Hacks by Bethany Bayless

Ah, the Holidays—it’s the most wonderful time of the year! Also the most expensive—especially when you don’t live near your loved ones. Holiday travel can be awesome or awful. Here are a few tips that can help when it comes to booking your travel.

  1. Avoid Peak Days: Don’t travel on peak days. Guess what—Everyone is flying those days! They are by far the most expensive days to fly. For Christmas, those days are December 22, 23, and 24. For New Year, it is December 29 and January 2. Look at your schedule to see if you are able to tweak your travel days just a little to get the best price on flights.
  2. Travel Early or Late in the Day: Another thing to keep in mind is that the cheapest flights are generally the first and last flights of the day. Don’t be afraid to adjust your sleeping schedule just a bit by flying super early or super late. These are going to be the cheaper flights.
  3. Do your research: Use apps like Hopper to find the cheapest days to fly. They will even keep you alerted to when it comes time to buy at the cheapest rate. With Holiday travel, buying sooner rather than later is always advised.
  4. Shop Around: When it comes to flying, use those dates you got from Hopper and plug them into a site like skyscanner.com, or go directly to airlines sites. Southwest only posts on their website—so make sure you check Southwest for the prices they have on flights. Keep in mind, also, that though Southwest is not always the cheapest fare, your bags will always fly for free. That can make all the difference!
  5. Send Presents Ahead: If you can get away with it, don’t check a bag. We know the holidays mean lots of presents. Think ahead—use Amazon Prime to ship directly to the people receiving them or the house you will be staying in, or send them ahead of time. It will save you headaches when it comes to sweating your connections or losing your bags. It will save you time, and sometimes it can even save you money!

What are some of your favorite tips and ways to save money when it comes to Holiday Travel?

Bethany Bayless is a popular speaker, blogger and emcee. She worked in Europe for a non-profit organization before becoming the Director of Communications for the non-profit, Heroes at Home. Her work can be found at WanderlustforLess

Holiday Travel Planning Guide – Hint: Buy Early

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One of my favorite things to do when I have my adult children home is to go to church. We always went as a family when they were growing up and having them join in when they are home brings back great memories. The last time they came home, I stood in our row with Jonathan and Joshua sitting next to me and fought back tears of gratitude. At the end of the service, the music swelled loudly, our cue to leave the sanctuary and make room for the next service in our large church.

Bob and I got separated from the boys in the exiting crowd and when I looked back to see where they were, I was stunned to see the two boys wrestling in the aisles. Jonathan had Joshua in a headlock and Joshua was trying to punch him in the kidneys to break the lock.

Oy vey. Some things never change. “We were just having some fun!” they declared as I grabbed them by the ears and they straightened up.

Family times are the best times.

They Kay family loves to get together for the holidays, but travel can be expensive. Knowing when to buy those airline tickets can mean the difference between paying cash for your holiday travel or going into further credit card debt.

Thanksgiving and Christmas are still weeks away, but October is the month you should look to book flights for both holidays.

In fact, travel app Hopper recently released its Holiday Travel Index which includes data on when to fly and buy for both holidays. Here’s a few findings I found from the study:

  • Although Thanksgiving travel is expensive (even more so this year than last — domestic flight prices are currently averaging about $325 round-trip compared to $288 last year), prices won’t vary much during the month of October. You can put it off for a bit, but make sure you book your Thanksgiving flights before Halloween.
  • If you wait to book your flight until after Halloween, it will cost you about $1 per day, every day that you wait. Prices will then begin spiking closer to $10 per day during the final two weeks leading up to Thanksgiving.
  • Unlike Thanksgiving prices, holiday flight prices tend to rise more steadily as Christmas approaches, and then spike heavily in the last two weeks.
  • The best time to book Christmas flights this year is the first weeks of October. If you have to wait to buy, make sure you watch prices closely, as they will fluctuate and then start spiking moderately 15-25 days prior to departure. They will spike dramatically (about $7 per day) in the final two weeksleading up to Christmas.
  • If your plans are flexible, you can save the most money by leaving on Tuesday, December 19 and returning Thursday, January 4

Keep in mind that it’s important to budget for holiday travel in conjunction with all the other expenses accrued during the holidays.

In our family, we value experiences over things. This means we will spend money to get kids home and spend less on their gifts once they get here. After all, it would be boring if we didn’t have Jonathan and Joshua fighting in the church aisles during the holidays.

The Millennial Boomerang

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“My kids will never come back to live with us after they are launched.”

“I don’t have worry about boomerang children, mine have great jobs.”

“Junior would never get into trouble and need me to bail him out, he’s a good boy.”

Have you ever made a declarative statement that you had to take back and eat, along with a big, fat slice of humble pie?  I have. In fact, I’ve eaten so many humble pies that I’ve put on five pounds just thinking about it! That’s why I’m approaching today’s blog very circumspectly.

“Failure to Launch” was not only a popular Matthew McConaughey movie (would someone puleeze give that man a shirt!). It’s also a syndrome in America among Boomer and Gen X parents and their Millennial babies. There are many reasons for this boomerang barrage. One primary factor has to do with the unemployment rate among 20 to 24 year olds, which was 15.4% last year according to the Bureau of Labor Statistics.

Furthermore, statistics from the Pew Research Center indicated that 13% of American parents with an adult child had a child move back into the family home. While 40% of recent college graduates still live at home.

Money matters are the number one reason why these kiddies come back home to mommy and daddy as well as the struggling economy, student loan debt, consumer debt and in some cases legal troubles. Another primary reason is that some parents just enjoy having their kids at home and don’t really see the need for them to move on and move out.

There is good news and bad news for families in this situation. A boomerang incidence is detrimental when the children have an entitlement mentality, don’t carry their own weight in the home, are not looking for work, and cause their parents to delay retirement to get them financially settled. No one wins in that situation.

The good news of the situation exists when this living arrangement is only temporary and involves a solid exit plan. In fact, it can be a great bonding time between generations, especially if there are grandchildren involved.

But one thing is certain:  boomerang babies introduce more stress into the household. If the old adage is true that “company and fish are alike, after three days they both begin to stink” then having adult children home for an months on end has the ability to raise your blood
pressure significantly.

But what to do? What to do?

Here is the Ellie Kay motto for a situation like this, just tell your adult children:  “My love for you is unconditional, by my money is not.”  Your “money” in this case includes your home, furnishings, food, car, cash, retirement fund, home equity, phones, insurance, and anything else in your monthly budget that is impacted by new peeps living with you!

Here are some guidelines to follow if you find yourself in this situation:

  • DTR – “Define The Relationship” by discussing the living arrangement and defining the expectations on both sides. Come to an agreement as to what is expected of one another and delineate the boundaries.
  • Develop An Exit Strategy First – A solid exit strategy will have them back on their own between 3 and 6 months. If they know when they will be expected say “sayonara”, then that gives them a deadline to work toward in becoming financially independent again. It also helps to eliminate resentment when the time doth draw nigh.
  • Do What – Do What? – This is your new song, in that you are going to ask that son or daughter to do their portion for the household, whether it is doing chores and paying rent, or contributing by buying groceries and paying the light bill. The more uncomfortable it becomes in the parent’s nest, the more motivation that birdie has to re-launch.
  • Define the Rules – Part of the exit strategy will include the establishment of a budget for the adult child. I like the mint app because multiple people can track the spending at the same time. If they are living in your home, then you have the right to oversee a budget that will help them live on their own again. The idea of this may seem to restrict their freedom but it’s all part of the diabolical plan to kick them back out of the nest again.
  • Do have them pay Rent – Once they are employed, then begin to increase the rent over the course of the next months until they are paying the same rent to you that they would be paying for a place of their own. If you want an idea of what rent is in your neighborhood, go to Rentometer to find out a fair rate. YES, it’s probably more than what your lovely room and board is worth—BUT THAT IS THE POINT! You want them to see how it’s not worth it to live with mumsey; it’s a better value elsewhere.
  • Do Unto Others –– If you want to be kind (and sneaky in a good way), then you can take half the rent they give you and put it in an account that you can then relinquish to them. This will help them pay the first and last month’s rent on a place of their own. But you don’t “owe” them this act of kindness, your money, after all, is conditional while your love is unconditional and don’t fall into the trap by defining your love with how much you pay their way.
  • Do Give Them Wisdom – In some cases, the best assistance you can give them (besides the establishment of a budget) is to get them to a financial counselor such as nfcc.org that will help them for free. The National Foundation for Credit Counseling can renegotiate loans, restructure debt and provide accountability outside of your direct influence. There’s nothing like a third party to be the bad guy when it comes to letting them know the real deal in the real world.
  • Don’t Bail them Out! – Just remember the idea of precedence: what you do once, you will have to do again for the same child or for another one of your children. Keep in mind your needs such as retirement, paying your bills, your credit scores and your financial future. We owe our children food, shelter and clothing for 18 years. We owe them unconditional love for a lifetime. But we don’t owe them a bailout when they overextend themselves or fail to plan responsibly.  

 

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