A key focus of my blog is Financial Literacy/Money. An important concept for everyone to understand is that of passive income. It’s a principle that is not well understood though it is a powerful one. Passive incomes can in fact take multiple forms. The following contributed post is entitled, Are Passive Income Streams What They Seem?
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What is a passive income? A passive income is money going into your account that you don’t have to work for. Instead, the money works for you in the background of your typical life routine. At least, that’s what people expect, but is this really what a passive income is? Is there anything in life where you can earn money without doing anything, literally nothing? Short of winning the lottery, we’re not so sure and even then you have to buy the ticket. Let’s dive a little deeper into this conundrum.
There are numerous examples of incomes that people tend to describe as passive. For instance, you might invest in stocks. Many people often refer to this as a passive income because you buy the stock and then wait for them to hopefully rise in value. So, you’re not really doing much and still earning money. However, you can’t be completely passive here because if you are, you’ll miss out on the right time to sell.
What about the property? This is another option people suggest can be a passive income but is it really? After all, to invest in property, you need to make the purchase. You then need to decide whether you are going to let or sell. If you let, you take on all the responsibilities of a landlord and while you own it you have a lot of commitments. For instance, you’ll need to pay a rental tax. Luckily, there are companies such as https://nzrentaltax.co.nz/ that will be able to help you out here. This is one of the ways that you can keep an income passive. You can pass off the duties and responsibilities to another person or business and they will handle it for you. However, that will only be possible if your investment budget allows for this.
A real example of a passive income would be something like a savings account. While it’s true that you will earn additional money through interest on a savings account, it won’t be enough to make a massive difference to your earnings. It’s just a nice added bonus of choosing the right bank.
Or you could be more dramatic and suggest blogging is a passive income. But it’s not really because you need to put the time and effort into making the blog a success. If you treat a blog like a hobby rather than a business, you’re never going to earn the money that you want. You can learn more about running a successful blog on http://stuff.co.nz.
Despite not being truly passive it is still worth looking for one of these possibilities. Essentially, what we’re talking about here is a side hustle or a secondary income that supports your primary one. You may have to put some effort in and potentially even spend money in places but experts agree everyone should have at least two incomes. It puts you in a far more secure place when dealing with future financial challenges.
“I personally recommend having a year’s worth of savings in the bank!”
Note. Like my Net Worth piece, the subject matter of this blog post is not new. It has been known for years by those who’ve learned about it in their families, learned about its concepts in business school, or have discovered it on their own. It’s a discussion from my personal perspective which I think is worth visiting. Also, while this is a ‘money’ topic, I’m discussing it from a ‘scholarly’ perspective. I’m not rendering financial advice where I’m telling readers what they should do. In the spirit of the first principle of my blog, Creating Ecosystems of Success, I’m simply introducing a concept and discussing why it’s important for the lay person; so they can make their own life choices.
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Reflecting on my youth, both of my parents were savers and they showed that in their own unique ways. As described in my piece regarding budgeting, my Auntie Adele was quite the budgeter and she was always outspoken (and vigilant) about that. All of the pieces were there in my mental periphery, though it wouldn’t be until my adult years that I’d figure out how every piece in terms of one’s personal finances ‘fit together’ as I’ll describe later. I’ve learned that you can hear about something, but it’s not until doing it yourself that you actually understand it. This is why Rich Dad Poor Dad author, Robert Kiyosaki, frequently referenced the “Cone of Learning” in his books.
Though I intuitively knew what ‘emergency funds’ were before taking Dave Ramsey’s “Financial Peace University (FPU)“, I got a much clearer picture of what they were and why they’re important. I’ve covered many other important aspects of personal finance here on my blogging platform, but after a potential collaborator emailed me recently about linking their online resources to some of my content, I realized that I never covered emergency funds. It’s a topic that is timeless in terms of importance and is especially relevant with my recently purchasing a new car. As such, I think I’ll use that a jumping off point for this piece.
If you don’t know, I’m a YouTube content creator now and have four channels. My original Big Discussions76 channel now covers several topics, financial literacy/money being chief among them. I recently shot a video discussing my decision to acquire a vehicle after going without one for eight years. You can watch that video in the link below. If you do, please kindly give a like, share it in your network and subscribe to my channel.
I also wrote two pieces discussing why I decided to go without car ownership. In those pieces and in my YouTube video, I communicate that one of the checked boxes for rejoining the car ownership club was having a fully funded emergency fund. In FPU, Dave Ramsey describes a fully funded emergency fund as one that contains three to six months of savings based upon the critical items on your personal budget. That’s actually a little more on the liberal side. Some people, like one of my mentors, are more conservative and believe that one (or a couple) should have a year’s worth of savings in the bank! If your personal finances are highly leveraged credit-wise and you’re living paycheck to paycheck, this may all sound like a gargantuan task, but from personal experience, I can assure you that it can be done.
I can’t lie though, in that it does take a great deal of determination, grit, and delayed gratification to create a fully funded emergency fund. Spiritual folks would also say that it takes a great deal prayer. In either case, you must know what your ‘why’ is, or your motivation. That will help keep you going even when things feel lonely or even get hard. What was my motivation for creating an emergency fund? Let us go back to car ownership.
“Cars are built to breakdown,” said Mr. Cholley Gray of the former Gray’s Auto in my hometown of Buffalo, NY. In my trips back to Buffalo from Charlotte, NC, Mr. Gray performed most of the repairs on my first car, a white 1990 Subaru Legacy which was passed down from my mother to my brother, and then to me. Having been through seven long years of Buffalo winters, I inherited the car right around the time when rust started taking hold of many of its parts and wear and tear had set in. I went through numerous transaxles when I owned that car. Each was $150-$200 each time.
The biggest and probably the costliest repair was the “rack and pinion” which went out on me down in Charlotte, NC. For those unfamiliar with the inner workings of automobiles, the rack and pinion is a part of the power steering system. When the piping rusted out that fateful day, the car became extremely difficult to steer and it made what I would call a howling or a screeching sound like a saw cutting through wood. One of my professors and I investigated the systems of the car in his driveway and saw that it was literally bleeding the pink power steering fluid. It was a fixable repair, which came at a price of $850. As an undergraduate I was mortified by the price in addition to the sound the car was making. Fortunately, my father was there to send me the money, just as he was there to purchase the car for me from my brother and pay for my insurance.
My burgundy 1996 Saturn SL2, which I purchased in Ann Arbor, Michigan while in graduate school, had two costly repairs within the final six months of grad school. This led me to bow out of the car ownership club in the summer of 2012. One night near my job, one of the front wheels rusted out completely. That is the entire support stabilizing the wheel needed to be replaced. That costed $1,200 at Meineke which was my entire federal income tax return that year. Only months later, the cable attached to the manual transmission broke while I was driving. Fortunately, I wasn’t on the expressway and was able to pull off onto a side street without being harmed. That repair also came out at $1,200 which was the final straw for me. Mentally, I’d already prepared for getting rid of the car, like a loved one on life support.
Probably the most painful repair though, was around 2010 when the radiator cracked in the scorching Northern Virginia summer heat. Not only was that repair $500, but the mechanic, an Asian guy named Steve, bitched at me and jeered me about getting a new car when I picked it up. The nerve of that guy, right? After all, I paid him for his service. My girlfriend at that time pretty much agreed with him on the spot, making a bitter afternoon more bitter. At that time, I was temporarily living with her while closing on my condo unit. I planned to give her something for that month towards the rent, but because of the transmission going out, I couldn’t pay her, which she secretly held against me and sprung it on me during one of our many future arguments.
If it sounds petty for me to tell this side story about my ex, rest assured knowing that there’s a grander purpose. Sometimes in life we set out with good intentions and unexpected things happen affecting the entire mosaic. If we’re not prepared, domino effects can result making situations exponentially worse. I’m saying all of this to say that life is so much better when you have an emergency fund, a stash of money saved just in case something goes bad. It literally gives you peace of mind. Everything is just different because you’re not constantly worrying about something going wrong or breaking. When something does break, wears out, or needs to be replaced, you’re not scrambling for money or to take out loans. It’s truly a different way of living. “Murphy leaves you alone,” as Dave Ramsey jokingly says.
Having an emergency fund also allows you to potentially help those around you. Going back to the girlfriend described above, there was another instance where she needed to get new tires on her car to pass the state inspection. By the way, she was educated and had a career of her own. That said, I was still expected to take care of her in certain ways. This is a prevalent expectation and I’m not disputing it as I understand the psychology of it more now. It’s just something for some men reading this to be cognizant of. There is more I could say about it, but that’s a separate discussion.
At that time, I didn’t have a fully funded emergency fund and was unable to safely pull the $300-$400 out of my savings to pay for her new tires. I’ve often wondered if she would have been more ‘human’ to me throughout that relationship if I could have done more for her financially. Based upon what I know now, the answer is yes.
Going back to when I discussed ‘safely’ pulling the money out of my savings, let me unpack that a little bit more. A decision you must make when someone comes to you for help, or announces that they’re in distress, is whether or not you can afford to help them. Put another way, will you potentially later need the money said person is asking you for? If so, you may not be able to help them because if you do, you may be stuck asking someone else for help later on yourself, another domino effect.
The other thing is that after being both the lender and lendee, I agree wholeheartedly with Dave Ramsey in terms of loaning money. I don’t believe in loaning money anymore. If someone comes to me these days for help, I assess whether or not I have the money to give. If I can’t give the full amount, I give what I can and don’t expect anything back, as loans put a mutual strain on personal relationships. From a spiritual standpoint, Proverbs 22:7 reads, “The rich rule over the poor and the borrower is slave to the lender.” It’s something for everyone to ponder, especially with friends and relatives.
I’m going to close with two more points. The first of which is that while I discussed emergency funds in the context of automobile ownership in this piece, it reaches into many other areas. In the last five years, I’ve lost a cell phone, I’ve had to replace my refrigerator, and the toilet in my home.
I’ve also refinanced my mortgage a couple of times. While not an emergency per se, these have involved me using some of my savings to help the transactions go through. Speaking of savings and mortgages, if you can’t purchase your home outright with cash, one of the key things lenders will be looking for when deciding to qualify you for a mortgage, is your history of saving money. Likewise, the more you have saved, the better the loan terms you’ll get if you qualify. I’ll also jokingly state here that me and the ex-girlfriend discussed above got into a standoff over this point one night. My father and I had also talked about this before. I was factually right, but sometimes being right in relationships just causes more drama and resentment.
My final point involves retirements savings. Some individuals have started saving in their retirement accounts which is absolutely the right thing to do as employees. Unfortunately, when adverse events occur, some people must use credit cards, loans or raid their retirement savings because they don’t have any other ‘liquid’ cash available. Raiding your retirement savings involves a tax penalty and unplugs the money from ‘compounding’. An emergency fund thus provides a layer of protection for your retirement nest egg, and that’s an important though not widely understood reality about retirement savings.
With all of this being said, a fully funded emergency fund, while an important piece of your financial health, isn’t an ultimate layer of protection. There may be bigger adverse financial events looming and that’s what your insurances are for (health, car, homeowner, renters, etc.). That’s a separate topic all in itself, but one that everyone should also consider.
• They improve your overall peace of mind, health and quality of life just by relieving financial stress. • They allow you to absorb and recover from negative financial events (but also remember that insurances are important). • They protect your other savings and investments and allow you to easily navigate transactions like home purchases and refinances. • They allow you help those around you (if you can afford to).
In closing, keep in mind that your emergency fund is not meant to be the investment of the century, just a layer of protection against life, and it acts as insurance in a way. Though it may be sitting in a savings account not making much interest, you want to be able to get to it quickly in case of an emergency (not for frivolous spending). There are savings accounts that can earn more money for you such as a money market account, but again that is not the main point of all this. The point is to protect you and your investments.
Thank you for taking the time to read this post. As of now I’ve written several financial pieces on my blogging platform and many of them are listed on the bottom of the Big Word Blog Site’s home page. I’ve also published numerous shorter money and business-related pieces with guests and contributing writers. You can find those by simply searching my categories menu on the home page or by typing “money”, “finance” or “business” into the search box at the bottom of the home page. If you read something you like, please leave a comment and share in your network via email or in your preferred social media space.
To receive all of the most up to date content from the Big Words Blog Site, subscribe using the subscription box in the right-hand column in this post and throughout the site, or by adding the link to my RSS feed to your feedreader. Please check out any of my four Big Discussions76 YouTube channels. Lastly, follow me on Twitter at @BWArePowerful, on Instagram at @anwaryusef76, and at the Big Words Blog Site Facebook page. While my main areas of focus are Education, STEM and Financial Literacy, there are other blogs/sites I endorse which can be found on that particular page of my site.
Two focuses of my blog are Financial Literacy/Money and Business/Entrepreneurship. As a new business owner, you always have to watch your costs and carefully manage debt if you’re going to use it. In general, you have to keep your operations financially healthy for as long as you can. The following contributed post is entitled, 3 Ways To Avoid Bankruptcy When Starting A Small Business.
Staring a small business can be fulfilling, exhilarating and downright stressful at times. There are a lot of things that are involved when it comes to creating something from the ground up. One of the biggest hurdles most business owners face as they are starting up is the finances. The common known phrase it takes money to make money rings true. If you are a small business owner, you may be wondering how can you avoid small business bankruptcy when the money is tight. Well, here are some useful tips to keep in mind when it comes to capital and your small business.
Have A Plan
Planning is the ticket to a stress-free life in your journey as a small business owner. Creating a business plan with clear goals, detailed steps of execution, in-depth regulations and governing of the workflow is imperative to your company’s success. Your plan will give you the blueprint for making educated decisions about where you want your business to be located, the pricing of your product or service as well as how much it costs to run your business, and what to invest in. You also want to keep in mind that when you are asking for funding, investors are going to ask for a business plan, so it is better to have one than not.
Make Sure Your Product Or Services Are Quality
There is nothing that will bankrupt your small business faster than not providing quality products or services. You want to be sure that when you launch you are providing customers with the very best your business has to offer. Cultivate a strong and authentic brand for your product or service. If you already have existing customers, maintain great relationships with them. Put your focus on reaching your target market.
It Is Ok To Borrow But Do Not Borrow Too Much
This can be tricky. There is nothing wrong with borrowing money to get your business off the ground. The issue comes when you have found yourself borrowing too much money. Then you have found yourself in a tough situation that could lead to bankruptcy. That is why being mindful of how much you need to borrow is important. In a perfect world you may have saved up a nice chunk of money that you can invest in your business, but more than likely you will have to borrow some money.
No matter what, you want to be sure that you will get a return on your investment. Keep track of the monthly interest, how many installments you will pay and for how much and the term of your loan before you decide to sign. When going over your business finances, be sure to deduct loan payments from your profits that way you can fully understand how much the loan will cost you. Once you know how much the loan will cost you, down to the penny, you will have a better handle on paying the money back.
A key focus of my blog in Financial Literacy/Money. A significant part of your personal success and quality of life is your personal financial health. Taking control of your finances is particularly important when you’re struggling. The following contributed post is entitled, Take Control of Your Finances When You’re Struggling.
Everyone experiences money troubles of different kinds. Even when you’re financially comfortable, you can have times when you’re trying to work out how to stretch your money further. There are also times when you can feel like you’re really struggling and you don’t know how to get back on track. Your money problems are ruling your life, but you don’t know how to make them go away. You could be in a lot of debt or struggling to pay the bills, and you feel like you have no control. If you want to start getting control of your finances, have a look at these steps.
Make a Plan for Your Debts
Most people have some kind of debt, whether they’re paying off a phone, have a credit card or have a mortgage. Some debt is good debt, but there’s also plenty of bad debt, and it can weigh on you heavily. Making a plan to pay off your debts should be a priority if you’re having financial problems. You might need to look into tax relief options if you’re struggling to pay off a tax bill or consider debt consolidation if you have a number of debts. Look at different strategies for paying off debts too. You might pay off the cheapest or the most expensive first.
Everyone who wants to get their money under control needs to start budgeting. When you set a budget to stick to, it helps you to control your spending. The first thing that you need to do is take a look at what you’re currently spending. Work out how much your fixed expenses are, then come up with a reasonable budget for more variable expenses, such as groceries and clothes. Once you have a budget, you can track your spending, and you’ll be more conscious of whether you’re sticking to your budget.
Review Your Spending
After creating a budget, you might be able to start saving some money by lowering both your fixed and variable expenses. For example, review your bills to discover whether you could save any money. Find any subscriptions or services that you no longer need or that are wasting your money. Do you really need cable TV? Do you use that Netflix subscription? Getting rid of unnecessary spending can help you pay off debts faster, save more or have more money to spend on things that you want or need.
If you feel like you need to reconnect with your money, consider using cash only to pay for things. You can set up automatic payments for bills, but when you do things like go grocery shopping, withdraw a set amount of money for the month so that you know exactly how much you have left. Stop using your credit card and even debit card for a while, and slowly start to use them again if you feel comfortable.
You can take back control of your finances. Start taking a close look at any debts, your spending and how you could save money.
Two of the focuses of my blog are Financial Literacy/Money and Business/Entrepreneurship. Whether you’re the business owner or the investor, a lot of money can be made from start companies also known as “startups”. The truth however is that these ventures in all likelihood won’t started generating significant cashflow early on. The following contributed post is entitled, The Raw Truth: Making Big Bucks From Startups Takes Time.
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A few companies start generating profit immediately. But almost always, the most financially rewarding enterprises make practically nothing for the first five years of operation. There’s a long ramp between setting up the firm and actually getting a return for all that hard work.
Take Square, for instance, a company heavily involved in payment systems. The firm, operated by Jack Dorsey of Twitter fame, was lambasted by investors in 2013 for failing to make any money. That year it lost nearly $100 million after taxes and depreciation, and many thought it would fail. Furthermore, the company had already been operational for four years, meaning that such losses were even more difficult to bear. Investors wanted to see a return, but they weren’t getting it.
Just a couple of years later, though, all the doom and gloom disappeared. The company turned things around. And now, it is part of practically every investor’s stock portfolio. You can’t afford to leave it out.
What happened? Essentially, Square spent the first five years of its existence looking for long-term profit opportunities. It didn’t try to satisfy investors by the quarter. Instead, it made decisions that were costly but would set it up for market dominance in the future. These bold decisions then attracted more investors who kept the enterprise afloat until it started making money.
It’s not the only example, either.
Amazon
Jeff Bezos founded Amazon in 1994. The company increased its sales to around $150 million by 1997 and over a billion in 1999. Unfortunately, it wasn’t making any money over this period. In 2000, the company borrowed billions from investors but had less than $350 million in cash on hand at one point.
It took the firm until 2003 to turn a profit, but it was a weak result. Many people believed that Amazon would never make any serious money.
Bezos, however, had a plan. He decided to invest all additional revenue into the firm to develop its technologies and systems. Eventually, it became the market leader, able to do things other eCommerce brands couldn’t. Ultimately, it came to dominate the market, even managing to beat out rivals like eBay.
Something similar is happening with Tesla motors. The company began in 2003 and yet it didn’t manage to turn its first profit until 2013. After that, it continued to make losses, only making serious money towards the tail end of 2019. That’s a long time to wait!
According to fintech industry experts, something similar is happening in their sector. The InsurTech Accelerator, for instance, provides security for firms with a long ramp. The hope is that the sector will see success stories similar to those of Amazon and Tesla.
Making big bucks, therefore, takes a long time. When you reinvest profits in a firm, you’re essentially compounding your advantage (as you might with a stock portfolio). The longer you leave it to take money out of the company, the more it’ll eventually make (so long as you make smart business decisions).
Two of the focuses of my blog are Financial Literacy/Money and Technology. The internet has created multiple ways to make money beyond the traditional way of punching the clock every day for hourly wages. Making money online is still a foreign concept for many people but there are many methods for doing so. The following guest post is entitled, 5 Quick Ways to Make Money Online.
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One of the best things about the internet age is how easy it has become to earn money. If you know a few tricks, you can add to your bank balance quickly without really doing much in the way of hard work at all. To help the students and hard-up people who may be reading this blog, we have put together a list of the five easiest ways to turn a profit online which involve little or no effort.
1. Online Casinos
If you have a good memory and a head for numbers, online gambling can be a great way to make money. Nowadays, the choice of games and bonus offers available at the massive number of online casino sites is almost endless. Visit https://www.casimba.com/en-ca/ for one of the best online casino services on the internet.
2. Surveys
It may not seem like you can make much money from simply filling in a few surveys. However, if you look hard enough, there are now a number of survey sites that offer reasonable sums for your information and opinions on products and services. It is just a question of finding them!
3. Matched Betting
Have you ever noticed that incredible welcome bonuses that sports betting sites offer new customers? What if we told you that there was a way of winning on these offers every time? Well, there is! It involves a few calculations and finding a rival bookmaker that is offering similar odds for the opposite outcome in a sporting event. Playing one bookie off against another might sound sketchy, but in fact, it is entirely legal and a guaranteed route to free money.
4. Review Music for Money
Do you love music and sometimes wish that you could help new bands get signed to record deals? If you sign up to sites like Slicethepie.com, you can! All you have to do is create an account, listen to tracks and give them a ranking depending on how much you like the song. You then receive money in your account for every band you review.
5. Trading in Domain Names
If you have a bit of liquid capital, you might consider buying and selling domain names. On sites like GoDaddy.com, you can pick up domain names for as little as $0.99. If you are perceptive enough and can see the way markets are going to turn, you can make a lot of money. For example, if you had bought a domain name for a cannabis site years ago in anticipation of legalization, you may be able to sell it for thousands of dollars today.
If you are strapped for cash, try turning to the internet for a bit of financial assistance. The online world is a veritable treasure trove of money-making opportunities. The ideas detailed above represent just the tip of the iceberg. With just a bit of imagination and inside knowledge, you can make a fair bit of extra pocket money to keep you afloat when you need it the most.
A key focus of my blog is Financial Literacy/Money. While usually only thought about in terms of moving from one personal residence to another, storage units can actually save you money in other contexts as well. The following contributed post is entitled, Shocking Ways A Storage Unit Can Save You Money.
Not enough storage is the bain of most people’s existence. Homes and offices may be stuffed to the brim with things accumulated overtime or things that are never used. When you realize this cannot go on any longer, you are then left with the heart-wrenching decision to let things go whether you sell them, give them away or throw those things away altogether. That can be tough and extremely time-consuming. Though it is good to go through your stuff on at least an annual bases, it may still be difficult to find space for the things you hold dear and the things you may need in the future. Renting a self-storage unit may be the best way to go.
You may think renting a self-storage unit will be just another added cost that you cannot afford but on the contrary. A storage unit can save you money in a lot of shocking ways.
When Downsizing, A Storage Unit May Be More Cost-Effective
Let’s say you are now an empty-nester or maybe you have had a career change that may require you to downsize. Maybe you are changing your lifestyle and you are downsizing by choice. Either way, it can be crushing to let go of your sentimental items. This is why getting a self-storage unit is a great way to downsize without having to let go of the things you do not necessarily need but want to keep for sentimental value.
Downsizing is a great way to save money because you can save a ton of money on rent, mortgage, maintenance, and heating and cooling by moving into a smaller space. Moving into a smaller space does not mean you will now live a cluttered life. Moving your stuff into a self-storage unit close to your new digs is a great way to let go of your things that simply will not fit into your new place.
Save Money For Your Business By Getting A Storage Unit
Maybe you are a small business owner who is starting to get things off the ground. Maybe your business is expanding and you do not want to uptick your overhead costs just yet. You want to keep the overhead costs down, but you do not want to compromise. This is where getting a storage unit can come in handy and save you money. Off-site storage units give you the flexibility to store your business’s surplus of inventory or supplies without having to physically expand to a bigger location.
Getting A Storage Unit Can Mitigate Moving Costs
Instead of doing the move all at once, making multiple trips and spending money on gas or hiring a professional moving company, you can get a storage unit. This option allows the move to be less encompassing and making it easier for you to complete on your own or with a few friends. It also provides you with the opportunity to do the move at your own pace.
A key focus of my blog is Financial Literacy/Money. Money is one of those things that will literally disappear without a trace if you don’t take an active role in its management and tell it what to do. Immersing yourself in its management is the key to being successful with it. The following contributed post is entitled, The Benefits Of Taking An Active Role In Money Management.
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Did you know that a quarter of Americans claim to be worried about money constantly? With an uncertain future ahead, and the economy sharing headlines with health news on a daily basis, it has never been more important to take an active role in money management. Here are some of the key reasons to keep a firm grip on your finances and some tips to help you cope if money is a source of stress.
Controlling spending, reducing the risk of getting into debt and saving with a budget One of the most beneficial steps you can take to manage your money effectively and tip the balance in your favour is living with a budget. If you don’t already budget every month, you may well be surprised at what a difference it can make. There are now several ways you can create a budget and track spending, including traditional pen and paper, spreadsheets and apps. The primary aim is to enable you to gain an accurate insight into the comings and goings of your accounts, so that you know how much you’re earning and what proportion of your income you’re spending.
With a budget, you can control spending, lower the risk of getting into debt and save more money. Use your budget to set a spending limit for each week or month and analyze your outgoings carefully. You might find that you stumble across payments you thought had ended months ago, or you might suddenly remember that you’ve still got subscriptions or memberships you don’t even use anymore, for example. Your budget might flag up overspending on groceries, or you might be shocked at how much your insurance policies have gone up. Use the data, update your budget as you go to ensure that it’s always precise and look for areas to make cuts.
Keeping a close eye on your financial activity It’s simpler than ever before to track spending with online banking and money apps, but it’s also incredibly easy to forget about payments you’ve made due to the fact that we rarely use cash now. With contactless technology, smartphones and direct debits, money can be flying out of your account without you so much as signing your name or entering a pin code. Make sure you know what’s going on in your accounts every day. Download apps to check on the go, and don’t ignore statements or texts with warnings or balance updates. Keeping an eye on your accounts can help you regulate spending and ensure you notice any potentially suspicious or fraudulent activity as soon as possible.
Seeking expert advice for financial issues It is not uncommon for people to get into debt and find it difficult to get out. If you’re struggling to pay your bills, your credit card balance is increasing day by day, and you’re falling behind with your rent or mortgage, the best thing to do is seek expert advice as early as possible. There are multiple debt management solutions you could consider, and a financial adviser will help you select a route that caters to your needs. Examples include credit counseling, debt consolidation, and in cases where you can’t cover your debts, a consumer proposal. It can be daunting to reach out, but debts can spiral very quickly, especially if you have a high-interest credit card, or you’re borrowing on a regular basis. If you’re in a tricky situation, there are ways to reduce debts, to prevent creditors from pursuing you and to protect your income.
Working towards a stable future Most of us would like to have a financial cushion, but it can be very challenging to save when you’ve got a household to run. If you can use your budget to make savings and analyze your spending habits to create a wider gap between your income and your outgoings, try and put a little aside each month. It’s also critical to look into employee benefits or separate pension programs if you are self-employed. If you have an emergency fund and a retirement pot, this will stand you in good stead in the future, particularly if your circumstances change. Look for savings accounts with a high interest rate or consider putting your money into an asset that will appreciate. If you have a healthy balance, and you’re keen to invest, you could look into buying a rental property or stocks and shares, for example.
Budgeting, analyzing bank statements and tracking spending might not be everyone’s idea of fun, but it’s so crucial to have a handle on your finances. Taking an active role can help to prevent overspending, lower the risk of getting into debt and facilitate saving.
A key focus of my blog is Financial Literacy/Money. Unless you were raised in a family of investors, it can be a whole new world. In addition to beginning your investing journey, it’s important to begin it as safely as possible. The following contributed post is entitled, A Quick Guide To Investing For Beginners.
‘Investing is the act of allocating resources, usually money, with the expectation of generating an income or profit’ Investopedia.com.
If you’re eager to invest but unsure where to begin, this quick guide covers the basics to escort you in the right direction. Below are a few commonly asked questions that you may be thinking about, coupled with answers to help you decide; whether investing is right for you, the opportunities available, and some top tips to help you invest with confidence.
Is investing the right option for me? Before investing, firstly think about whether you have a substantial amount of savings, like an emergency fund. And whether you need to pay off any high-interest debts such as credit cards and finance agreements, as these should ultimately be your top priorities.
Beyond this, if you have the means to ride out the current pandemic without jeopardizing your finances. Money leftover to play with, and time to invest for the long-term, before a particular life event such as retirement. You’ll have a better chance of riding out the ups and downs of the market, and investing could be an excellent option for you to boost your future income. Especially when the interest on savings accounts at the moment is pitiful.
However, if you’re hoping for a get rich quick scheme, investing may not be of interest to you. It takes time to accumulate wealth from investments, and there is always the risk you could lose the money you put in.
What investment opportunities are there? From tangible objects to living things, there’s a broad spectrum of items for you to invest in. Here are a few for you to consider;
➢ Property – commercial and residential buildings ➢ Foreign Currency ➢ Cryptocurrency ➢ Real estate ➢ Shares within a company ➢ Art and antiques ➢ Commodities such as oil, coffee, and gold
A concept and currency that’s piqued the interest of newbie and experienced investors alike is virtual currency, and sites like Bitit, have made it far easier to begin investing. To find more on Bitit, there is a wealth of information online to help you decide whether investing cryptocurrency is right for you.
Top tips for investing? With an array of different opportunities to invest your cash, research and familiarize yourself with your options because you should;
‘Never invest in a business you cannot understand.’ – Warren Buffett
When learning about investing, you’ll often see the term investment portfolio mentioned a lot. It’s a sensible money management technique used by investors to create a diverse collection of investments, which shall hopefully provide them with a higher prospect of making a return. For instance, should one of your investments cause you to lose money, you would still have other investments in your portfolio that may endure the volatility of the market.
In summary, the top tips for investing are;
➢ Research investment opportunities you are interested in ➢ Diversify your investment portfolio ➢ Refrain from withdrawing your money too soon. You need to stomach the ups and downs and refrain from withdrawing your cash too early.
A key focus of my blog is Financial Literacy/Money. A key piece of being financially literate is understanding how to manage and in some instances cut expenses. The following contributed post is entitled, Here are Some of the Top Ways you Can Save on your Monthly Expenses.
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One of the biggest challenges that you could hope to face in life is finding ways to spend less money. If you are in this position right now and want to help yourself, then you need to focus on lowering your monthly expenses as much as possible. Sure, your monthly bills might seem small or insignificant on their own but when you add everything together, you will soon see that the cumulative effect is enormous.
Use Public Transport
If you know that you have access to public transport then you can save a huge amount of money on gas, parking and even maintenance. Every time you leave the car behind, you can save money. If you don’t want to take the bus, then there are rideshare programs available and this makes it easier than ever for you to lower the expenses you face. If you feel as though your vehicle is rarely used, then you may want to try and sell it if you can. You never know, you might be able to pay off some of your high-interest debts. If you want to sell your car then visit Junk Car Cash Out.
If you have student loans which have a very high interest rate, then it is helpful to figure out whether it makes sense to consolidate them. When you do this, you can then get all of your loans at a fixed rate and you can also save money every single month too. If you are carrying other kinds of debt at a high-interest rate then it is always a good idea for you to look into a balance transfer. This is a very good option and the best transfers can give you perks up to 0% APR for up to 18 months. Some of them even offer you a rewards program too. Taking advantage of this can help you to pay down your debt and you can also save quite a bit on interest. If you want to get the best result out of your debt, then make sure that you factor in some of the balance fees and that you also pay down the transferred balance during the introductory period if possible.
Credit Card Rate Deduction
If you have a very large balance on your credit card, then it makes sense for you to call your credit card company so that you can ask them for an interest reduction. If you pay your bills on time every single month, then they may be willing to negotiate with you by offering a lower rate. If you have a strong history of late payment, then a credit card for bad credit may help you to rebuild your score so that you can then qualify for a much better interest rate in the future.
Automatic Debt Repayment Plans
A lot of instalment plans, especially those which are associated with student loans will offer an interest rate reduction if you are willing to sign up to automatic billing every month. You should never pass up the chance to do this because if you do then you will be able to save money every single month while also being able to take advantage of the convenience. If you have any installment payments, then see if this is an option for you.
Sell any Unused Items
Dig through your attic or even your closet to see if you can find any clothes which you no longer need. If you do this then you will be able to sell a bunch of stuff on Ebay or even Craigslist. You can then use the money that you earn to try and pay off any debt so you can put it behind you once and for all.
Cut Down on your Energy Bills
Another thing that you can do is cut down on your energy bills where possible. When you do, you can then free up more money every single month. This is a fantastic way for you to try and have a bit more freedom with your finances.
Of course, there are so many ways that you can save money every month and if you follow these tips then you will soon find that it is easier than ever for you to take control of your finances. If you need some help with your money, then don’t be afraid to hire a financial advisor. When you do, you can then count on them to give you the support you need with getting everything in order.
