We often tell ourselves that we need to do something about our finances without knowing exactly what we should do. Having the goal to improve your financial situation is great, but it doesn’t do you any good if you don’t have any idea what steps will get you there. Here are some ideas that should get you started:

1. Open up an online savings account. There are a couple different benefits to having such an account. The interest earned on these accounts is almost always greater than what you can expect at your local bank. Another reason for an online account is that it’s at a different institution that where you normally bank. There will be less temptation to frequently raid this fund since a transfer isn’t instantaneous. Give ING Direct a try since they’re also FDIC insured.

2. Take the credit cards out of your wallet or purse. This step is for those of you that can’t seem to figure out why you’re never able to pay off entire credit card bill when it comes (you know who you are). It doesn’t make you any less of a person, but it is good to recognize in yourself. Hide them, cut them up, put them in water and freeze them, do whatever you need to do to keep you from using them. You’re an intelligent person, you can figure this out.

3. Determine a percentage of your take home pay that you can save, and commit to actually saving it. Once you’ve determined the percentage, make sure you transfer this amount into your savings every time you get paid. In my opinion, this is far more effective than trying to put away a specific dollar amount every month. Every time you get paid, the first thing you do is transfer 10 or 20 percent to savings. You don’t have to think about it; you just do it. What’s left over you then use for your living expenses.

4. Don’t ever go out to eat without a coupon. This might seem like an odd one, but coupons are so available these days. If you plan ahead, you can get great deals through Restaurant.com, or you can just use what comes in your “junk mail”. I would say just stop going out to eat, but since you’re going to anyway, just make sure to use a coupon.

5. Set aside a specific amount of cash each month for Christmas. Get an envelope and write Christmas on it. Each month, put some amount of money into this envelope. At the end of the year, don’t spend any more money on Christmas than what’s in the envelope. People who do this have actually found that they don’t spend everything in the envelope which isn’t really a bad thing.

It’s an interesting question to consider. It also might be something worth trying out. I’m ignoring the fact that there are fixed expenses which technically could be averaged over every day. I’m talking about any product or service that you can choose either to purchase or not.

I’ve taken such a challenge and have tried not to spend any money until this Friday. This has been going on for just under two weeks now. I can tell you first hand that it’s not an easy task. I’ve put off shopping for groceries, or picking up fast food. I haven’t put any gas in either car attempting to make what’s already there last until Friday. I’m also not getting a haircut until after Friday.

Why am I doing all this? My credit card billing cycle ends on Thursday and any charges after that will occur in the next billing cycle, thus allowing me to defer them. Credit cards are a cash flow management tool and this is one way of using them as such.

Oftentimes people will lend money to family members or friends, and this is also often the cause of many relationships gone sour. Money is a very touchy subject and it’s a shame when it comes between two people who otherwise wouldn’t have had any problems.

I personally prefer not to lend money to friends and family as a general rule. It keeps things a lot simpler and possible problems are usually avoided. If you do, however, decide to lend someone money or borrow money from someone, make sure that you talk about everything up front.

Don’t wait until you need the money to talk about how you’re going to get paid back. On the flip side, if you’re the borrower, don’t wait until they demand it all back to start paying. Make sure that the terms are talked about up front and that you put it in writing. This may seem like a large hassle, and you trust your friend. Whatever the case, getting it in writing is the intelligent thing to do. If one of the parties doesn’t want to agree in writing, then I’d be wary of the situation.

Having grown up in Texas, I’ve had more than my share of experiences with fire ants. When I ran across this website, Fire Ants Guide, it naturally caught my attention. There’s quite a bit of information about fire ants including basic information, how their colonies work, and how to tell if you have fire ants.

Having had quite a bit of experience with fire ants, I can tell you that it can actually become quite an expensive ordeal trying to deal with them and eventually get rid of them. You can spend a lot of money on exterminations, spray or granular poisons, and ant traps. My family tried a lot of different things and my brother and I finally found out one of the only things that actually works. When trying to get rid of fire ants and their mounds, pour gasoline on them. You’ll kill the grass as well, but you’ll also be rid of the fire ants. This should save you some hassle and some money as well if fire ants are giving you a problem.

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July isn’t a month full of caroling, snow, presents, stockings or gingerbread cookies. It can, however, be a great time to start planning for these things.

I’ve seen the Christmas scenario time and time again and for some reason it happens to people over and over. Christmas time rolls around and “all of a sudden” as if by surprise you realize that you need to go out and buy everyone gifts. The Christmas parties and family activities/meals are “shockingly” accompanied by larger than usual grocery bills. You also might want to take the family bowling, ice skating, or (if you’re adventurous) to the latest Tim Allen Christmas movie.

However the holidays play out, too many people spend the first part of the next year trying to catch up on bills that they incurred back in December. If one is fortunate enough to have an emergency fund, all too many see this yearly occurrence as a qualified “emergency”.

So, why am I bringing this up in July during barbecue season? Christmas (or any other holiday you celebrate) is an event that occurs every year and is something that can be planned for. It’s not all too different than bi-yearly car insurance premiums or your yearly car registration. Money can (possibly should) be set aside during the year to pay for these types of expenses.

A great way to tackle this problem is to label an envelope with the specified purpose and to treat it as a bill every month. If you put away $60 every month, you’ll end up with $720 at the end of the year to spend on Christmas in any way you’d like. People who have implemented this type of thing have also found that they usually don’t even need everything they’ve saved.

If you’re like most people and have those lingering memories of “Christmas debt”, now is a great time to start preparing for what you already know is coming. Trust me, your holidays will be a much happier time if you do.

There are a lot of important aspects of personal finance, and each of us places greater emphasis on certain things rather than others. I talked before about the importance of knowing your expenses and that it would be a good idea to have the number memorized.

Today I want to emphasize another key number, or ratio, that you ought to be aware of. It’s known as your expense ratio. Not only should we know what are expenses are costing us every month, but we should also know what percentage of our income is tied to our expenses. They are very similar, but the ratio provides key information that will help us improve our financial information.

It should be obvious that the lower the expense ratio, the better. If your ratio is somewhere around 80%, it means that your discretionary income is only about 20%. In order to lower your expense ratio, we come back to the two ways to increase your free cash flow.

It’s a great exercise to calculate what this ratio is for your personal situation. If you find out that it’s around 90% or greater (hopefully not more than 100%), you may want to consider some ways to bring it down.

Reducing this ratio has a couple of key benefits of which you should also be aware. The lower this ratio, the more you will have to save and invest. You can build your emergency reserves quicker and greatly increase your investment portfolio. You may also note that your emergency fund won’t need to be as big so you’ll be able to assemble it that much quicker.

By lowering this ratio, you’ll also have less of your income to replace by investment income. So many financial gurus tell us to try and have about 70% of our income in retirement. I would say that you should strive to have enough income to replace all your expenses and then some. If you can manage an expense ratio of about 40%, you should be able to replace this income in relatively short order.

If you can’t quickly put your finger on this ratio, maybe you should try calculating it for your particular situation. It’s a very telling number and one that you should work to decrease as best you can.

I thought I’d give you a look back at some of the most popular posts since this blog’s inception. If you’re new to the site, browse around and enjoy the posts. For the loyal readers, it’s always nice to review some things. Either way, make sure to subscribe to the feed for the latest updates.

Answering A Reader’s Question: This addresses the question of what sort of investments to choose for your Roth IRA, especially if you’re not savvy with stocks. There’s always a lot of discussion about the benefits of a Roth IRA, but not as much about what actually to invest in. This has been the most read post to date.

Restaurant Lifestyle…?: This is a few thoughts on living the restaurant lifestyle. Why do people do it so much, and what can we do to alleviate some of the costs.

Developing a Wealthy Mindset: Instead of focusing on the lifestyle of the rich, here are a few tips to start developing the mindset of the wealthy. It’s some food for thought to get you on the right track.

Investing with Peter Lynch: There is so much investment advice out there and it’s not all the same. This article delves into 8 fundamental principles that Peter Lynch uses when picking his investments. Definitely a good read.

Hopefully you’ve gained something from these articles. Also, if you have any suggestions or topics you’d like to see covered, feel free to send me an email and let me know.