Who doesn’t want more money? The internet seems like a quick, easy way to get more money. The internet is a quick, easy way to to get scammed. In person, you might recognize a smooth talker who just wants to get your money. But on the internet, when you can’t read body language or the tone of someone’s voice, you kind of half to read between the lines. My philosophy is to be skeptical of everything because nothing good comes so easily.

Money Scam #1 – The Arabian Prince Who Can’t Move His Cash

This scam comes in a few different forms, usually email or instant messenger, but it has been known to be posted on message boards and private messages on forums. A prince or some other foreign elite is interested in coming to the United States, but for some reason or another can’t move his money. So, he wants to send you a check, have you cash it, then wire it to him, keeping some of it.

After you’ve wired the money, the check bounces, and the bank (and sometimes the police) comes after you for cashing a fake check.

Don’t cash checks from people you don’t know.

Money Scam #2 – You Won a Prize, Just Send Money For it

These email scams claim that you’ve won a prize, but you need to send money for some kind of taxes or handling fees. Happy to have won something, you send the money, but never receive a prize. You guessed it, you’ve been scammed.

If you’re not the type to enter contests, then it should be a no-brainer that you haven’t won any prizes. Not only that, any taxes you have to pay will go to the IRS.

Money Scam #3 – Make Money At Home, But Send Money First

There are quite a few variations of the “make money at home scam” but they all cater to people who are interested in working from home. The scam convinces you of a program where you can make money from home, but first you have to send money from a starter kit or an informational booklet. You send the money, but never get anything back.

Other work at home scams ask for your personal information – name, address, social security number – then use it to get loans and credit cards in your name.

Another version of the work at home scam requires you to receive, repackage, and reship packages, sometimes involving illegal goods. You have to use your own money to reship the packages and if the authorities figure out what’s going on, you’ll be in trouble. Both the original shipper and the recipient will disappear.

Use Your Common Sense

Remember what I said earlier, there’s no easy way to get money. If something seems to good to be true, it probably is. When you’re wondering whether something is a scam or not, use the internet to do some research. Trust your intuition and skip out on money making mechanisms that just don’t seem right.

I live in a family with generations of quilters. I’ve known how to sew since I was a little girl, but never really took an interest in it until recently. Let me tell you, quality fabric with attractive patterns can be quite expensive. Fabric for just one quilt for a full-sized bed costs $37. It might not sound like much, but making several quilts a year can get quite expensive.

Your hobby might not be quilting, it could be golfing or movies or socializing, but it can still get expensive. It pays not only to have a budget that guides your spending, but to “post-budget” where you look at what you spent during a month. If your hobbies are taking up more than 5% of your budget, it’s time to re-evaluate. You have a few options

Make money from your hobby

The easiest way to offset the costs of a hobby you love is to figure out how you can make money from it. With quilting, I can easily start selling the quilts. That would cover the cost of making quilts and give me some extra money to save.

Find a way to do it cheaper

If your hobby was reading and you found you were spending hundreds of dollars on books each year, you could start spending more time in the public library. Or, find some friends who also reads books and trade with them. Purchase used books instead of new books. Sell books after you’re done with them. Or donate them and deduct them on your income taxes.

Do it less frequently

Another way to lower the cost of your hobby is to do it less often. Instead of going to the movies every weekend, go once a month.

Hobbies are meant to be fun, but it won’t be fun when your hobby makes you go broke. Spending thousands every year won’t help you reach your financial goals (unless your goal is to be broke). So you have to make some tough decisions when it comes to spending money on hobbies.

I used to completely ignore financial advice given by people who are broke. If they have no money, what could they possibly tell me about managing money.

If you think about it, you could learn a lot from a broke person. They’ve obviously made some heavy financial mistakes. If nothing else, they can tell you where they went wrong.

• I shouldn’t have bought that new car when I really couldn’t afford it
• That apartment cost too much for my income
• I was living above my means
• I invested in something I knew nothing about
• I borrowed from my 401k then I quit my job

Money mistakes are all over the place. While I may not let a broke person tell me what I should do with my money, I may listen to them tell me what I should notdo with my money. It may sound mean but, learning from someone else’s mistakes is priceless. Heck, I’ve made them to and I like to spend my time telling people where I went wrong, so they don’t do the same things.

Much of money management basics is common sense. Don’t spend more than you make. Don’t borrow more than you can afford. Keep track of where your money goes. So when you hear some bad advice, you may recognize it right away. Of course, it always pays to double check what you hear from any source to make sure you’re not getting duped.

Raise your hand if you absolutely hate it when stores start putting out Christmas merchandise right after Labor Day weekend. I’m raising mine in between keystrokes.

Stores put out Christmas merchandise extra early hoping you’ll start spending early and continue spending right until the end of the holiday season.

I’m talking about Christmas because I’m hoping you’ll start saving early and continue saving until you start your Christmas shopping.

The holiday season is a happy time for many. But, too many people are faced with depressing credit card bills once the new year rolls around. Too many people are still paying on last year’s Christmas debt and it’s September (in a couple of days). That’s not the type of situation you want.

What you want is to have a special savings account that’s dedicated entirely to Christmas shopping. Ideally, that savings account has all the money you need to buy your gifts, decorations, food, travel, and whatever else you spend on during the holidays.

If you want to have that dream account, you have to start working on it now. Figure out how much you can afford to save each paycheck. Then, on your next payday, go open your holiday savings account. Continue contributing to it each payday until you stop shopping for the holidays. Put your credit cards away and don’t even think about using them. And in case you were wondering, holiday gift shopping is not an excuse to dip into your emergency fund.

Most of my friends are twenty-somethings working in corporate America with no real financial responsibilities – rent, utilities, car note. So they have quite a bit of disposable income. You know what they do with it? Spend it. To hang out with them, I’ve got to keep up the spending pace, or else!

Once upon a time, I would spend right along with them and not think anything of it. Now, things are different, I’m working my way toward entrepreneurship and spending like there’s no tomorrow won’t get me there. What will get me there is being smart (and frugal) with my spending.

Whether you realize it or not, the people you hang around can influence your spending, even if they’re broke. People without money expect you to spend your money on them. People with money expect you to spend money with them.

You have to be careful of how your friends, and even your relatives, influence you to spend your money. If you don’t have a budget or clear money goals, you’ll be easily steered to spend more money that you should.

Set a budget and stick to it. Decide at the beginning of each money how much you’re going to spend on dining out, entertainment, and other leisure spending. Once you’ve spent that amount, stop spending. Don’t make excuses to keep spending, like “Oh, I’ll spend less in x category” or “I’ll cut back next month.” Be disciplined with your budget and learn to say “No.”

Be willing to change your friends if their spending habits continue to poorly influence you. You probably won’t have to make an effort to change your friendship. They’ll likely stop calling you to go to go out on the weekends when you say you can’t afford it.

One of the biggest money mistakes people make is spending more money than they have. In theory, it sounds impossible. If you only have a $100, how could you spend $200? Here’s how.

How People Spend More Than They Have

I’m always shocked when I go to friends’ houses and see their closets stuffed full of clothes and shoes that obviously haven’t been worn in quite some time. My closet doesn’t look like that and it’s not because I don’t shop for clothes. It’s because I get rid of mine.

Two or three times a year, I go through my closet, pull out clothes and shoes I know I’m not going to wear anymore and take them down to the local consignment store. They take 10-20 minutes to go through them, decide what they can sell, then give me some cash.

Don’t expect to get back what you paid for the clothes, even if they’re barely worn (or even not worn at all). Consignment shops typically have a set price they can offer.

Make sure the clothes are clean. Or else your items might get rejected.

Leave well worn items at home. If the items have obvious wear and tear, they’ll get rejected.

Forget about selling dated styles, especially to trendier consignment shops like Plato’s Closet.

Donate what you can’t sell.

The first time I had  a job that paid monthly, I thought I would be broke. I didn’t know how I would manage one paycheck the entire month. Surely, I’d spend all the month by the 10th and spend the rest of the month broke. It turned out to be the best thing that ever happened to me. I would pay all my bills at the beginning of the month, regardless of when they were due. Then what I had left over would be what I could spend/save for that month.

Looking back, managing weekly and bi-weekly paychecks was the hard thing. When all the bills are due at the same time, most people end up spending one of their entire paychecks on the bills. Then, there’s nothing left to save or even spend on food. Then, because they’ve been broke for two weeks, they tend to splurge the second paycheck and they end up broke again. That’s no way to live. So, I’m going to tell you two ways to manage your monthly bills when you get paid on a lesser timetable.

Scatter Your Due Dates

Instead of trying to match your paychecks to your due dates, make your due dates match your paychecks. Call some of your creditors and ask them to change your due date. Leave some at the beginning of the month and pay them out of one paycheck. Change others to the middle/end of the month so you pay them out of another paycheck. That way you’re not paying all your bills with one paycheck.

Build a Buffer

Build up the balance in your checking account so you have enough to cover half your bills when they come.  This might mean living frugally on a couple of your non-bill paychecks for a month or two.

Let’s say you get paid twice a month.  Your first check typically goes to bills while the second paycheck gets blown.  This month, leave half of your second paycheck in your checking account.  When the next month comes around, you’ll already have some money in your account, so you can use less of your first check toward bills.  You’ll have some breathing room.  Continue to leave part of both checks in your account, so you don’t have to use all of one to cover bills.

Most people don’t budget because they think it’s too hard. Let’s just say it is hard (which it isn’t), wouldn’t it be worth it if it means you’re living within your means and not stressing out about money every day/week/month all the time? I’m going to give you a short, simple budgeting method you can use.  You don’t need a spreadsheet software. All you need is a pencil (in case you need to erase), piece of paper, and calculator (you can even use the one of your computer).

Fold the paper in half.

On one half, write down your monthly income. This includes wages (after taxes), child support, alimony, money from hobbies, whatever you bring into your home each month. Add it all together and label that number Total Income.

On the other half, write down your expenses. Include everything you must pay for during the month – rent/mortgage, utilities, food, transportation, day care, child support, alimony, etc.  Add those up.  If you have money left over, allocate most of it to savings, then entertainment, clothing, and hobbies.  It’s ok to use your money leisurely when you have enough of it.  Finally, add together all your expenses and label it Total Expenses.  Your total expenses should equal your total income.

There you have it.  Your simple budget.

Payday loans are the absolute worst type of loan you can take out.  It’s not just because the loan itself – though triple digit interest rates has a lot to do with it.  It’s also because of the situation that breeds the need for these loans.

You don’t have savings or credit card (otherwise, you wouldn’t be thinking about a payday loan).  You’re pretty much living paycheck to paycheck.  Then, you have an unexpected expense.  Since you don’t have anywhere else to turn for quick cash, you opt for a payday loan.  Naturally, the situation hasn’t improved since you first took out the loan and you can’t afford to repay it, so you pay a fee to have it extended.  Then you do it again.  And again. 

State laws prevent you from rolling the loan over too many times, so you take out another payday loan to repay the first.  Within a few months you owe at least $1,000 in payday loans and fees.

Payday loans and cash advances only make a bad situation worse.  Even legislators who voted on payday loans now regret passing those laws.  In several states, like Georgia, laws are being passed to cap the interest rates on payday loans, keeping them in the double digits, at least.

What can you do when you’re in a bind and need cash fast?  Start by preparing for that type of situation.  If you’re reading this and you’re doing ok financially, start building an emergency fund.  Pay down your credit card balances so you have some available credit.  See this article I wrote for About.com Credit/Debt Management “15 Payday Loan Alternatives” more more ways to deal with a financial bind.