5 Tips for Making Progress on Your Money

Alexa von Tobel, CFP, Founder & CEO of LearnVest.com and New York Times-bestselling author of Financially Fearless, shares her must-know money tips. See Alexa on the show!

The world of personal finance is full of confusing and complicated jargon. That’s one of the reasons why I developed LearnVest.com, to help people feel amazing about their money and to make financial planning affordable, accessible and even delightful.

My financial tips are all things I would do myself—we have a limited amount of time, so it’s important to put any tricks into good use! Below are five of my favorite insider tips:

Be cautious.

There are many financial institutions who put their customers first and offer great service. But some bank tellers work on commission. Remember that not all bank employees are financial experts, but some are actually salespeople. The more bank products they sell, the more they make. Always do your homework and speak to an unbiased expert before making any big decisions!

Watch out for fees.

Make sure you track all of your expenses (with a tool like LearnVest’s Money Center) so you’re aware of any unnecessary fees you’re paying for. Some of the worst offenders? “Maintenance fees” (if you’re not meeting an account minimum) or out-of-network ATM fees. Read the fine print and stay up-to-date on your bank’s policies.

If it sounds too good to be true…

Understand what you’re getting into when you sign up for a new credit card. Promotional credit card offers (those with 0% interest, for example) can be a great tool to postpone interest. But they may want you to spend a certain amount within a particular time frame in order to be rewarded. And watch out for accrued interest. If you don’t think you can pay off your credit card before the intro period ends, you may be subject to pay the regular interest rate on your entire transfer (not just what you have left to pay).

Consider biweekly mortgage payments.

Over the course of a year, if you make your mortgage payments every two weeks instead of every month, you will greatly accelerate your pay down. Over the year, you end up making 13 monthly payments instead of 12, which in turn helps you pay your mortgage down faster and get out of debt quicker while paying less in total interest. As a quick example: Let’s say your original mortgage amount is $200k, with an interest rate of 4.5%. Over the course of 30 years, if you pay bi-weekly instead of monthly, you will save over $27k in interest, and you’ll pay off the mortgage in about 25.7 years.

Tackle credit card debt faster.

Apply the same trick to credit cards. While you get a statement once a month, you accumulate interest daily. If split your payment amount in two, pay part of it early in the month and the rest by the normal due date. You’ll still be paying the same amount, but it can help shave off interest and save money when your budget is tight!

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