America needed a wake up call for our love of lavish lifestyles many of us couldn’t afford but still sought after with the help of exotic lending options available to anyone with a signature and a pulse. During the high times of lending even if you had a 550 credit score somehow, some way a loan officer could get you a mortgage even if it cost you an interest rate that mirrored your shoe size times two. And we all know what goes up, must come down. And down is about where we’re at now.

Chances are if you’re reading this you had to make some major changes to the way you spend. Perhaps you had to cut down on taking vacations because you haven’t had a raise in over two years. Or maybe you now work two jobs just to put food on your family’s table. Or what if you have no job at all.

Then there’s the unthinkable—what if you had to forgo your beauty upkeep or had no room in the budget for new clothes?

(Joking)

Now when we do turn around from this, do you think any of us now used to a lifestyle of penny pinching will go back to whoring out our debit and credit cards to every Neiman, Nordstrom, and Macy’s?

Hopefully we would have learned our lesson by then. I hear that at one point in history, Americans were actually able to live without credit and on a single income. Imagine that!

P.S. Don’t forget to enter the FSL Cosmetics Lipgloss Giveaway! Entries must be in by TOMORROW Thursday, March 11, 2010

Darlings, the holidays are but a mere nine months away. If you want to spend this time next year being holiday debt free, it’s time to take some action. Opening a holiday club, a savings account where an amount of money of your choosing gets deposited every week or so until about October when it transfers back into your checking (or you get a paper check) just in time to pay for your holiday purchases, will help you pay for your holiday purchases. One key element of the holiday club is that you won’t be able to make a withdrawal from the account until it’s almost holiday time. Perfect for the person who finds it easy to put money in a savings but hard to keep it in there.

Many credit unions offer holiday clubs, but if you can’t find one near you, consider an online savings account and have funds automatically transfered every week or so from your checking account. Just don’t touch the money in your savings!

Putting away as little as $20/week from now until October will get you about $600. Not a fortune, but it’s better than putting $600 on a credit card, right? If you can afford to tuck away more than $20 every week, you’ll be in even better shape come holiday time.

P.S. Don’t forget to enter the FSL Cosmetics Lipgloss Giveaway! Entries must be in by Thursday, March 11, 2010.

Fashionable ones, before you go and slap those Zanotti’s on your Visa there’s some things you need to know about recent changes made to your credit cards. After years of being bullied by credit card companies, the Obama administration has put into act some rules to help protect you from the predatory actions taken by some creditors. But while some of the rules and fees have changed, expect the card companies to be true in form and find ways of getting around it and still sticking you for your paper.

Here’s a highlight of some of the changes:

1. It may become harder to obtain new credit cards now. And if you’re under 21, it’ll be even harder as you’ll most likely need a co-signer in order to apply. I kinda wish this was the case when I racked up an unspeakable amount of debt while in college. Can’t blame anyone but myself though. *sigh*

2. Credit card companies can no longer raise your interest rate on existing balances, under certain circumstances. Previously if you did something considered “unfavorable” by your creditor, you could see your entire balance being raised. BUT there is still no limit on how much interest they can charge new customers or on your future charges.

3. You will no longer be charged an over the limit fee unless you opt-in to the service. You also will not be charged a fee for how you pay your bill (you know those $9.95 and up fees for paying your bill over the phone). BUT you can get charged for expedited payments—believe that creditors will get smart on your tail and won’t post your “free of charge” payments until 2-3 business days later which can cause you a late payment depending on when your bill is due.

4. Card companies must give you at least 45 days notice before raising your interest rate, changing other fees, or making other significant changes. BUT card companies can still close your account or lower your credit limit without advance notice.

Bottom line—we took a few steps forward, but count on the credit card companies to take us many steps back. Be sure to read the fine print carefully and check your monthly statement with a fine tooth comb. The best way to stay ahead of the card companies is to never have a balance to begin with. Only charge as much as you can afford to pay back in full each month. If you have outstanding debts (like me) get yourself on a plan to pay them back ASAP. Call your credit card company to make arrangements to pay your outstanding balance if you need help. Or contact a non-profit organization like Money Management International if you really need credit counseling. They can help put you on a plan to get your rates reduced and your debts paid off sooner than you think.

Get the entire scoop over at USA Today. I highly recommend reading this article in its entirety since I only went over some highlights.

What do you think of the new credit card reform? Tell me in the comments!

So we’ve seen the return of luxury dressing at many of the New York Fashion Week shows–leather and fur will have their rightful spots in wardrobes across the world. But how do you pay for this stuff if you don’t exactly excrete currency? Well, with some smart budgeting and wise savings, you can have a fab wardrobe for next fall. Here’s how:

1. Bring Your Own Brown Bag. The days of spending $10 and up for just lunch everyday are OVER. If you aren’t culinary-inclined, google some quick lunch recipes and brown bag it. A trip to the grocery store can afford you enough food for breakfast, lunch, dinner, and snack for a whole week with what you might have paid for just lunch only. What you save needs to be tucked away into a savings account.

2. Open a Special Wardrobe Savings Account. No, I don’t think banks are actually offering “wardrobe” accounts, but you need to have a savings separate from all your other money so you don’t commingle your funds. Many banks offer something called a holiday club where you can put away small amounts of money every week or so and you can’t touch the money until October when they transfer it into your checking account or send you a check. If you store $100/mo from now until October, you’ll have $1,000 to spend on upgrading your wardrobe whether you choose a few big-ticket staples or a bunch of smaller-ticket ones. That’s only $25/week. You can do it!

Also check out online savings accounts (check the bank’s FDIC credibility before you hand over your green) that tend to offer higher yields and make it less likely for you to wipe your account clean at an ATM.

3. Sell Your Back Stock. If you have a closet filled with clothes you never ever wear, jazz them up, grab a camera, and pawn them off on ebay. One girl’s trash is another girl’s new Louis Vuitton bag.

4. Get Your Girls’ Support. You lean on them for everything else, right? Let them support you in your financial goal (and even help keep you in check when you slide).

You can also do a savings club with your girls through a susu. In a susu all parties are required to pay in a certain amount of money over a period of time usually on a weekly basis. Each week one person collects all the money everyone hands in which can amount to a really good sum. Let’s say for instance you and 10 trusted girlfriends decide to do a susu and each of you puts in $200. When it’s your turn to collect, you’ll get $2,000. Yes, you have to basically put in $2,000 to get your $2,000 but if you’re not a savvy saver, this is a great way to start.

Image Source

How do you save? Tell me in the comments!

If you’re fortunate enough to be getting an income tax refund (or unfortunate as some may argue that a large income tax refund means you gave Uncle Sam a big ole zero interest loan last year), it’s important that you don’t blow it all in one place. Tough times call for smarter money habits. There will be no MAC or Neiman Marcus all-out sprees for the financially smart fashionista this year. Check out a few of my suggestions on what to do with that extra green.

1. Put half of it away right away. Many people receive tax refunds in the thousands and it’s really tempting to splurge it on a big ticket item, but I beg you to resist that urge this year, fashionistas. Yes, I know the new spring 2010 Gucci Helena Open-Toe Platform Boots are very hot, but that $1550 (before tax, mind you) would look so much HOTTER in your savings account. Plus, you need an emergency fund of about 8-12 months worth of living expenses in case you become the victim of a layoff. And don’t forget to save for rainy day things like car repairs and medical bills.

If you’re the type (like me) who find it easy to transfer money in your savings, but hard to resist from transferring it back out, look at options like holiday clubs or vacation clubs at your local credit union. Club accounts can often be opened with as little as $5 and every deposit you make normally cannot be easily withdrawn until the holidays.

2. Donate 10%. The recent tragedy in Haiti has donating money on the minds of nearly everyone around the world. Find a reputable charity (like the Red Cross, Former Presidents’ Clinton and GW Bush foundation, or Wyclef’s Yele Haiti) and give with your heart. The IRS is allowing you to deduct a donation to Haiti on your 2009 taxes. There are also thousands of other charities you can also donate to. Do your research and give! Also look to see if your company offers any donation matching programs that can easily double your givings.

3. Pay down your debt. Depending on your situation, try to put down a major payment to diminish some of your debt. Don’t spend every penny of your refund on debt unless you also have a reserve of living expenses handy. Even if you can’t afford to pay off your balances in full, a bigger payment now helps in reducing future interest payments and in some cases can reduce your monthly payment on revolving accounts.

4. Get yourself something nice. Yes, I did warn you not to go out splurging, but we’re not fashionistas for nothing! It’s hard to not indulge in a little treat every now and then. But instead of going crazy, get yourself something timeless like a great pair of quality leather boots. Not only will you be fashionable and treat yourself, you’ll also have your item for seasons and seasons and SEASONS to come.

Those are my quick tips. Now it’s your turn! Tell me what your tax refund plans are.