This Week In Your Wallet: Nothing Petty About The Fallin’ Dollar
There are a few things in life for which you could say I’m an evangelist. Running would be one. Dogs another. (I got home after a late flight last night — who was there to greet me at the door? Take a guess.) Saving money, sure. And, of course, paying bills online — some of them automatically.
If you’re looking to make your financial life a whole lot easier (and more efficient to boot), then autopaying bills is a no-brainer — but it shouldn’t be mindless. Sure, you can forget about dealing with paperwork and stressing due dates — but go on autopilot without ever checking in and you’re bound to crash. That’s why I want to bring your attention to this Reuters read on why you need to keep a close eye on automation. If you’re one of the 61 percent of Americans who autopays at least one of their bills, keep the following in mind:
- Funds that fall short. It only takes one missing (or late) payment caused by a lack of funds in your account to hurt your credit score for years to come. Always keep an eye on your account balance so that there’s enough money to pay your bills — and then some. Having a padded account will help you avoid those pesky overdraft fees too.
- Unnecessary spending. Three months after you cancelled your unused gym membership, you find out you’re still paying…to not use it. Whether it was in the fine print or a result of unfinished paperwork, it’s easy for monthly recurring charges to blend in after you try to stop them. When you cancel any type of service or subscription, look out for the charge on your statement for a few months afterwards to make sure the financial tie is really completely severed.
- Accidentally hitting pause. Making one manual payment for a bill that’s usually automated can interrupt your regularly scheduled programming. If you have to switch up the form of payment one month, make sure to log into your account online — or even call the service — to confirm what the system says you’re enrolled in. This happened to me with my cable/Internet bill. Had I not checked — and re-entered my card information — my next bill would have collected dust.
Not a Petty situation
The euro has been free fallin’ for weeks, but yesterday the tables slightly turned and the “Superdollar” is a little less super now. In fact, the dollar fell further on Monday, adding to its steepest weekly drop in three and a half years. The euro, however, had a much better day, rising 1.2 percent to trade at $1.09 (which was certainly better than last week’s 12-year low of under $1.05). For those of you who had been fantasizing about walking alongside the Jardin du Champ-de-Mars towards the Eiffel Tower — on the cheap — don’t throw your beret to the side just yet. It’s still a good time to book that European vacation.
According to the travel site Orbitz, airfares to Paris are down 14 percent from last year — and hotel rates are down by 10 percent. If seeing Buckingham Palace or touring the Colosseum is more of your thing, then now’s a good time for these trips, too, as airfare and hotels are cheaper for London and Rome. Other wallet-friendly (and international) destinations include Spain, Finland, Japan (thanks to the weak yen) and South Africa. Or, if you’re looking to stay on this side of the world, then consider visiting our neighbors up north: Canada’s currency is equivalent roughly 80 cents on the dollar, making now not a bad time to go, eh?
From refund to riches
Sure, you could use your refund to afford that amazing European getaway, or even better (albeit maybe not as fun), you could use it to put yourself in a stronger financial situation so that you can afford multiple trips down the road. For example, you can use it to pay down your debt, which happens to be what 39 percent of taxpayers plan to do with their refunds, according to a recent survey by the National Retail Federation. Great news! You could establish or bulk up emergency savings, an IRA or a Health Savings Account. Or, you can get ahead on your mortgage payments by paying one or two extra, which has long-term benefits too — you’ll pay less interest overall. In fact, if you make one extra mortgage payment every year you’ll essentially turn a 30-year fixed rate mortgage into a 24-year one. For more smart ways to use your refund, head to Money.com.
Don’t settle for less
Aiming to win you over, credit-card issuers are duking it out to offer the best and most competitive rewards, especially with cards offering cash back. In August, for example, Citigroup launched its Citi Double Cash card, which gives you a total of 2 percent back (1 percent back on your purchase and the other 1 percent when you pay for it). Similarly, you can get up to 1.8 percent back with the Cash Back Plus World MasterCard. And just last week, Citizens Financial announced its newest card that offers cardholders 1.5 percent back on every purchase. Considering the above, The Wall Street Journal says not to settle for 1 percent cash back when shopping for credit cards anymore.
Have a great week,
Jean
