President Obama Trims Budget by $17 Billion

From the Hoss's Mouth

When President Obama first took office he inherited a 1.3 billion dollar deficit. There was also a growing economic crisis that required the President to propose measures that would further increase the budget deficit. Fully recognizing that long term economic growth would require budget deficits be controlled and debt reduced, President Obama ordered a line by line review of the federal budget.

He instructed all his staff and Cabinet members to review all government programs and identify those that don't make sense, are no longer useful, or are not working. All this in order that his administration could eliminate them. In other words (The Hoss is paraphrasing here) get rid of the wasteful spending by the government. What a refreshing concept that is.

The result of that line by line review is a document called Terminations, Reductions, and Savings.

The Hoss has listed a few of the main items:

• LORAN-C ($35 million) GPS has made this long-range, radio-navigation system obsolete.

• Abandoned Mine Lands Payments ($142 million) A program that pays for mines to be cleaned up; only problem...they have already been cleaned up.

• Educational attaché, Paris, France ($632,000) A full-time representative to UNESCO in Paris, France is to be replaced by e-mail, video conferencing and travel.

• Los Alamos Neutron Science Center Refurbishment ($19 million) A 30-year-old facility that no longer plays a critical role in weapons research.

• Even Start ($66 million) Programs such as Head Start, Early Head Start, and the Early Learning Challenge Fund are simply more effective.

• Advanced Earned Income Tax Credit ($125 million) Found to have an extremely high error rate. The government accounting office (GAO) found that 80 percent of recipients did not meet at least one of its requirements.

• Rail Line Relocation Grants ($25 million) Loaded with earmarks.

The Hoss reminds you that the above are but of a few of the more than 100 terminations, reductions or savings identified in the Terminations, Reductions, and Savings document. Every one of the programs has a supporter, and they are fully aware there will be long and hard lobbies against this Budget.

President Obama promised change in Washington. This is a step in the right direction, although The Hoss wonders if President Obama will be able to convince Congress to pass his Budget. It will be very interesting to see how this all plays out in the long run and if ear marks will finally be dropped from the Budget-making process.

Stay on track,

The Hoss

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Money Saving Tips

From The Hoss's Mouth

The Hoss has compiled a number of money saving tips to assist you and your family in planning ways to cut your family expenses. Many of these tips are easy to implement and will result in considerable savings to your budget.

• Money saving Tip 1: The proper use of a programmable thermostat can result in a considerable savings in your home heating bill. Consult your local power company for recommended settings or look for information on the Internet.

• Tip 2: When going on vacation be sure to utilize the vacation setting on your hot water tank.

• Tip 3: Fix leaky faucets.

• Tip 4: Use weather-stripping and/or caulk to plug heat loss from drafty doors or windows.

• Money Saving Tip 5: Seal all energy leaks. Cracks and small holes around windows and exterior walls should be caulked.

• Tip 6: Purchase energy efficient compact fluorescent bulbs to replace standard candescent bulbs.

• Tip 7: Here's one you've never heard before: Turn out the lights.

• Tip 8: Turn of your computer and monitor when not in use.

• Tip 9: Basic cable only. Do you really need all those specialty and movie channels?

• Money Saving Tip 10: Do you really need call waiting, caller ID, voice-mail, call forwarding and three-way calling? Consider cancelling one or all of these services.

• Tip 11: Compare the various long distances providers. Choose a plan best-suited to your needs. Pay attention to their rounding policy. Do they charge by each minute or portion thereof or do they charge for actual time used? If you talk for a minute and a half and get charged for two, that is an unnecessary expense.

• Tip 12: If you are paying for multiple cell phones, this can be very expensive. Eliminate any that are supplemental to your basic needs. Sign up for family plans.

• Tip 13: Automatic teller machines (ATMs) are a great invention. However, you may be charged a transaction fee for using an ATM not associated with your financial institution. Identify which ATMs you can use without incurring a transaction fee.

• Tip 14: Closely monitor all your bank's service charges and identify areas where these charges can be eliminated or reduced, such as reducing the number of times you use ATMs if you are being charged per transaction.

• Money Saving Tip 15: Utilize the coupons in your local supermarkets' sales flyers. This could result in a huge savings in your budget for groceries.

• Tip 16: By store brand rather than name brand.

• Tip 17: Garage sales can also help reduce your expenses. You can pick up quality items for a greatly reduced price.

• Tip 18: End of season clearance sales can provide a huge savings on clothes.

• Tip 19: Where you have the expertise and knowledge, do it yourself. Paying service people can quickly add a great deal of unnecessary cost to your budget.

• Money Saving Tip 20: For special occasions such as birthdays, avoid gift-wrap that is expensive. Shop the dollar stores for good cheap wrapping. Mrs. Hoss does this all the time; she finds gift bags for a dollar, no more than two dollars, depending on the size.

• Tip 21: Learn to change the oil on your car. This can save you a few hundred dollars a year. Otherwise, utilize the many coupons that are available.

• Tip 22: Save on gas by keeping your tires fully inflated and your car tuned.

• Tip 23: Eat at home with meals prepared at home. Pack a lunch for work. Restaurant and take out foods are expensive and greatly increase budget expenditures.

• Tip 24:Eliminate those specialty coffees at the specialty rates.

• Money Saving Tip 25:Be self-motivated: Workout at home. Spa and health club memberships are costly.

• Tip 26: Pay cash. Many stores offer discounts for cash payment.

• Tip 27: Shop for an insurance company that will give you a preferred rate if you carry all your insurance with them. For example: car insurance, mortgage insurance and household insurance.

• Tip 28: Look for free activities: Take your kids to the park for a picnic and feed the ducks. Check your local newspaper for community events that are offered free of charge.
  

• Tip 29: If you go to a movie, make it a matinée or on a discount evening.

The Hoss realizes you may not be in a position to implement all of the above money saving tips, but make the most of as many as possible. This will help you and your family reach the financial goals you have established.

Stay on track,

The Hoss

Next Hoss Cents Free Financial Money Magazine Post: Banking and Finance

Previous Post: Creating a Budget

Creating a Budget

From The Hoss's Mouth

The Hoss says: Creating a budget is a necessary tool which will enable you to meet your financial goals. In order to create a successful budget you must do the following:

Hoss Cents Free Financial Money Magazine Success Tip

• Categorize how and where your money is currently being spent. Collect all your financial statements for the past six months. This includes bank statements, mortgage payments, recent utility bills, gas bills, food bills, insurance bills, credit card bills and all cash receipts. In addition, total all your sources of income. In short, any information regarding income or expenses that will help in creating a budget.

• Evaluate your income and spending to see if your current lifestyle is meeting the priorities you and your family have established to achieve financial success (see establish financial priorities).

• Compare your income versus expenses. I suspect many of you have expenses that exceed your income. Have each family member identify areas where they can reduce their expenses and increase their income. You will note you have certain fixed monthly expenses, such as your rent or mortgage, utilities and insurance payments. It is unlikely that you will be able to significantly reduce these expenses, so concentrate on your family's variable expenses. Expenses such as clothing, transportation, groceries, and entertainment. Cut these variable expenses and produce a budget that adjusts your spending habits so that you and your family will be able to reach your financial goals. The goals you wrote down as per the Hoss's instructions in the previous post of this blog. The Hoss realizes this is not an easy task. His next post will provide you with suggestions that will enable you to identify areas where costs can be reduced and help you with creating a budget.

• Each and every month, review your budget and make sure you are on track with your goals. Identify where you did well and what areas need to be adjusted to meet your target. This is extremely important if you are to achieve the targets set by you and your family. Be honest with yourself; cheating results in failure and you will fail in creating a budget.
  

The Hoss has prepared a budget pie chart which identifies expense categories common to all families, and suggests what percent of your take-home pay should be allocated to each area. The Hoss has also included some examples of the types of expenses in each budget category. The list of expenses below is by no means complete, but is provided as a guide to help you get started. Each and every family will have to construct a budget according to their needs.

Housing: mortgage, utilities, cable, insurance, taxes

Living Expenses: entertainment, miscellaneous items

Savings: emergency fund, investments, retirement

Transportation: gas, insurance, parking, bus

Debt: loans, credit cards, etc.

Food: groceries, vitamins, etc. Note from Mrs. Hoss: Booze is not a food group

Hoss Cents Free Financial Money Magazine Success Tip

The Hoss suggests you seriously consider using an accounting software program. This will enable you to simplify the process of recording your financial transactions and creating a budget. Most of these programs enable you to assign each transaction a specific category, and to compile a report detailing these transactions. This enables you to track how much you have spent on such items as fuel, insurance, car repairs, groceries, clothing, mortgage, etc. Your sources of income are also tracked. In other words, it simplifies the evaluation process outlined above. If you have a Microsoft PC, The Hoss suggests utilizing Microsoft Works, as it usually comes free with the purchase of the computer. It contains a monthly budget template which will help you set up your budget.

The Hoss says: It really is that easy folks. Track your income versus expenses, and then adjust to meet your family's financial goals and you will be successful in creating a budget.

Stay on track,
The Hoss

Next Hoss Cents Free Financial Money Magazine Post: Money Saving Tips

Previous Post: Setting Financial Priorities

Financial Priorities

Establish Financial Priorities

From The Hoss's Mouth

The Hoss says; establish financial priorities for you and your family. This is an absolute must for financial success.

Any financial money magazine you read or any financial adviser you talk to will almost certainly relay the same information: The first step in any successful financial plan is to establish your financial priorities, or in other words, figure out what you are saving for. The Hoss says, be sure to include your spouse and other family members at this stage. It is much easier to obtain your goals when the whole family has input and is committed to achieving the agreed upon targets.

OK, don't worry. I know this is easier said than done, but The Hoss will provide you with suggestions to help you achieve this lofty goal.

First, make a list of everything you and your family members need or want to make them feel happy and secure. Let The Hoss help you get started with some goals common to all family members:

• get out of debt

• college education for the kids

• buy a house

• retirement fund

• planning a vacation

• save a little each month

• purchase household appliances

• buy a car

• start a business

• rainy day fund

Hoss Cents Free Financial Money Magazine Success Tip.

List your financial goals in order of priority

The Hoss says, now that you and your family have identified your financial goals list them in order of priority and break them down into three categories: Short-term, Intermediate-term and Long-term. Financial advisers differ on the recommend time frame for these goals. Look at all the circumstances and decide what makes the most sense for your family's situation. The Hoss provides examples below, but be flexible and adjust accordingly.

Short term goals - A year or less.

Intermediate-term goals - One to five years.

Long-term goals - Five years or more.

Hoss Cents Free Financial Money Magazine Success Tip.

Write your goals down.

The Hoss suggest using the KISS principle (Keep It Simple Silly). No, The Hoss is not calling you silly, but he is suggesting you keep your goals simple and realistic. If your goals are too complicated or unrealistic, you may be tempted to abandon them. Writing your goals down will help you and your family stay on course. Do not overlook this tip. It is extremely important for you to have a document to refer to in order to measure your success. Remember; do not be too rigid, as unforeseen circumstances may cause you to adjust your goals. This is a reality of life.

OK, that's enough for this post. What you have achieved here is in reality the first step in budget planning. Next edition of the Hoss Cents Free Money Magazine will deal with the remaining steps in building a budget to achieve your financial goals and priorities.

Stay on track,
The Hoss

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