Fun with Money – State Quarters

Copyright 2014 - Sweet Doll Designs Copyright 2014 – Sweet Doll Designs

While money can be serious, I want to show you with this blog that it can also be a fun topic.  I encourage you to have fun with your money.

One idea is, when rolling the change you’ve collected during the week (see last week’s discussion), put aside the State Quarters.  Then, purchase a State Quarter map so that you can attractively display these unique quarters.

Above, you can see a picture of my State Quarter map.  If you would like to purchase one, here is a link to  the the Amazon.com warehouse*: Statehood Quarters Collector’s Map: Plus the District of Columbia and United States Territories

This is an inexpensive treat to get for yourself so that you can get in the habit of having fun with your money!

Post in the comments below the ways you have fun with your money.

Happy Decoding!

Fun fact for today – The first quarters were circulated in 1796, but they did not have George Washington’s head or even a denomination printed on them!  The quarter was distinguished from other coins by its light weight.  It wasn’t until 1804 the “25c” was added to the back of the coin.  George Washington’s head was put on the front of the coin in 1932 to commemorate the 200th anniversary of his birth.  (Sources: https://www.usmint.gov/kids/coinNews/circulating/25centCoin.cfm & http://en.wikipedia.org/wiki/Washington_quarter)

*Note: This is an affiliate link to Amazon.com.  I will make a few pennies for each purchase.

Painless ways to save – Keep the Change

Copyright 2014 - Sweet Doll Designs
Copyright 2014 – Sweet Doll Designs

Last week, I promised that I would give you tips on painless ways to save.  Here is my first one!

Whenever you can, pay for your purchases in cash.  The key is to pay only with whole dollars, and not with change.  You might put your change in a fun change pouch for the time being, then empty the change you collect into your favorite piggy bank (I have 3 – pictured above!) and periodically roll your change and deposit it in the bank.

I roll my change about once each quarter and I usually have about $40 – $60 in change to deposit in my account!   That means that over the course of the year, I’m saving roughly $160 – $240 just because I pay for my purchases only in whole dollars and save my change.  That’s not too shabby!

In order to get into this habit, it works best if you give yourself a weekly cash allowance.  I give myself an allowance for groceries and entertainment each week (I pay for gas with my credit card because I earn cash back points for that).  Giving myself a weekly allowance in cash not only helps me with this savings program, it encourages me to think carefully about my purchases (I find it really easy to overspend when using a credit card).  For example, do I really need that extra package of cheese, or do I have enough food in my cart to last me for the week?  These are things I think about when I make a final decision about my purchases before walking up to the checkout counter.

Paying in whole dollars and saving the change is a great savings program for adults and kids alike!  This could be a great way to help teach your kids how to save part of their allowance.

If you are averse to carrying around cash for some reason, many credit and debit cards have a similar program.  I’ve heard of some programs where the credit card company will round-up your purchase to the nearest whole dollar and put the difference in a savings account for you.  I’ve heard of other programs where if you use your debit card for purchases, the bank will automatically move $1 from your checking into your savings for each debit card use.

The bottom line is to use the program that works best for you in your current lifestyle.  The point is to get into the habit of saving!  And if you can do so without noticing the “pinch”, so much the better!

Happy Decoding!

Fun fact for today – In 2012, Americans spent almost $2.1 billion on Easter candy!  That’s a lot of chocolate bunnies and jelly beans!! (Source: http://www.infoplease.com/spot/eastercandy1.html)

To owe or not to owe: that is the question

Copyright 2014 - Sweet Doll Designs
Copyright 2014 – Sweet Doll Designs

Now that my husband and I have filed our 2013 taxes jointly for the first time, the discussion in our household is how to organize ourselves for tax season next year.  Should we receive a refund or should we owe taxes for 2014?

While I think it’s nice to get a refund on my taxes, when I think about it, getting a refund means I’ve given the government an interest-free loan.

A few years ago, I re-configured my tax deductions so that less taxes are taken out of each paycheck, and at the end of the year, I owe a bit in taxes.  Since less taxes are taken out of my paycheck, I put the extra money I receive straight into a savings account where I earn interest throughout the year.  Then at the end of the year when I calculate how much I owe in taxes, I simply take the money out of my savings account and write out a check.

This way, the government has given me an interest-free loan, and I’ve earned a bit of interest in my savings account in the process.

I know that some people use their refund for vacations or other big purchases.  This is also fine, but again, consider that you’re loaning that money and not earning any interest on it.  Wouldn’t it be better to save your money each month so that you can afford that same vacation or other big purchase, all while earning interest in the bank?

Stick with me and I’ll give you some tips on painless ways to save in future posts!

I am not a tax professional and cannot give you tax advice*.  All I’m encouraging you to do is consider your options.  It is worth asking the Payroll department of your company what your paycheck would look like if you changed around your tax deductions.  You might even use that information to re-calculate last year’s taxes and compare the result to be sure you wouldn’t owe too much in taxes.  Then make your final decision (which can always be changed again if needed).

If you’re looking for a great savings account, I have been very pleased with Capital One 360 (formerly ING Direct).  They offer some of the best interest rates I’ve found.  As I write this today, the interest rate on my savings account is 0.75%.  Compare that to what a traditional bank is offering and you will see a huge difference (my traditional bank is offering a 0.01% interest on my savings account – I only keep it as overdraft protection).

What I really like about the Capital One 360 account is that you earn more interest than at traditional banks, you can have as many accounts as you want (each for a different purpose, if you wish), there are no account minimums, and it is super easy to transfer money whenever needed.

Capital One 360 did not pay me to promote their products and I am in no way affiliated with them.  I am simply a happy customer.  If you’d like to look into opening an account with them, please consider using this link: https://r.capitalone360.com/PWBs7SgWpH  If you open an account with $250 or more, both you and I will get a bonus!  It’s a win-win for everyone! 🙂

So what have you and your household decided is the best way to handle your taxes?

Happy Decoding!

Fun fact for today – The first US income tax started in 1862 to help raise money for the Civil War, which began April 12, 1861 at Fort Sumter, SC. (Sources: http://www.bargaineering.com/articles/50-fun-facts-about-taxes.html and www.reference.com)

*Please consult a tax professional when making changes to your deductions that will have an impact on your taxes.

Filing status on your taxes

Copyright 2014 - Sweet Doll Designs
Copyright 2014 – Sweet Doll Designs

My friend got married in 2013.  Early in 2014, she was contemplating how to file her 2013 taxes – Married filing jointly or Married filing separately?  When she asked me about it, I was curious and did a little research, since I just got married last year, too.  The results I found were interesting and I thought you might find them so as well.

There are four filing statuses to choose from:

  • Single
  • Married filing jointly
  • Married filing separately
  • Head of Household

These options may seem self-explanatory, but if you’re married, you have a decision to make, especially if you’re a newlywed and this is the first time you’ll be filing a tax return as a married person.

So, which status should you choose?  I’m not licensed to advise you in your situation, however I can share some information with you.

According to the 2013 tax tables, a household Taxable Income of $75,000 would owe the following amounts:

  • Single – $14,685
  • Married filing jointly – $10,614
  • Married filing separately – $14,740
  • Head of Household – $13,259

As you can see, if you’re married, it may be to your advantage to select Married filing jointly because you may owe less in taxes.

I was most surprised to find that the Married filing separately status owes more taxes than the Single status.  I always thought that a married filing status, regardless of which one you choose, would be more advantageous than a Single filing status.  It turns out that may not be the case!  Also, I found out that filing separately means you can’t claim several tax benefits (such as student loan interest deduction, for example) that are available with other filing statuses.  To learn more about that, check out this website: http://taxes.about.com/od/filingstatus/qt/marriedseparate.htm .

So why would married couples consider filing separately?  Two examples I came across in my research are: 1) if the couple lived apart for six months or longer, and, especially if they lived in different states, they may not be allowed to file jointly; and 2) it seems common for wealthy couples to file separately in order to keep their finances separate, or maybe because one would owe taxes while the other would receive a return.

If you’d like to learn more about each filing status, this website explains each in more depth: http://taxes.about.com/od/filingstatus/qt/FilingStatus.htm .

There are many factors that go into determining your filing status and, in the end, you may decide to consult a tax professional before filing your taxes this year.

Happy Decoding!

Fun fact for today – In the United States, the first permanent income tax was established in 1913 with the ratification of the 16th amendment. (Source: http://www.bargaineering.com/articles/50-fun-facts-about-taxes.html)

Anatomy of a Check

This is an important post for me.  Not only is it my first one, but this topic is part of what sparked my passion for Financial Literacy.

I distinctly remember in the 6th grade, my teacher brought in an overhead image of a blank check, much like the one pictured below, and taught us how to properly fill it out.  We each got our own copy of the check so that we could practice by ourselves.  At the time, my parents had already opened a checking account for me – I remember writing out the check for my calculator at the beginning of 6th grade.

Thinking back on these experiences now, I wonder how much of a money education kids are getting in school.  I don’t think money basics like this are taught in class, leaving it up to parents to educate their kids about money.  However, what if the parents don’t feel as though they know enough or they were never taught about money – how can they be expected to teach their kids something they’re not sure about?!

Then came my thought – I love finances, taking care of my money, and watching it grow.  I love learning new savings techniques and talking to people about money.

I even enjoy paying my bills!

With this blog, I am endeavoring to share my passion for learning about money with everyone.  So here we go, my version of Anatomy of a Check:

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When filling out a check, all you need to do is write:

1)      Today’s date

2)      The person or company to whom you wish to give the funds

3)      The amount of the check written in numbers

4)      The amount of the check written in words, putting the cents in terms of 100 (ex: 00/100 for no cents, or 50/100 for 50 cents), and drawing a line after the “100” to the word “Dollars” (this is to prevent unscrupulous people from having enough room to tamper with your check)

5)      A memo (for your records, or sometimes the recipient will request you note your account number)

6)      Your signature

Be sure you write legibly so that the bank can read the check correctly!

When you order your checks from a check printing company, your name and address will be pre-printed on your checks (7), as will your bank name (8), routing number (the first group of numbers – before the colon) (9), account number (the second group of numbers – after the colon) (10), check number (11), and the basic format of the check.

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A few interesting notes: when you write the amount to be paid in words, if that amount is different from the amount written in numbers, the bank will honor the amount written in words.  That amount is legally binding!  So, take your time when filling out checks and be sure you are doing it correctly!

Also, it is never a good idea to have your social security number pre-printed on your check – this is a very important number and private!  Finally, it is best not to get your phone number pre-printed on your checks.  If a company needs that information, you can always hand-write it on the check.

As you can see, it is not difficult to fill out a check, but if you’ve never done it before, it might take a bit of practice.  Try it a few times on the sample check below and have fun with it!

Happy Decoding!

Fun fact for today – on April 2, 1792, Congress passed the Coinage Act which created the US Mint, and the first one opened in Philadelphia.  Happy Birthday US Mint!  (Source: http://www.reference.com)

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