Wednesday, 20 November 2019

Budgeting for Beginners: Cash Envelope System | Weekly Paycheck

Budgeting for Beginners

Today we will be talking about how to budget for beginners and how to set up your own cash envelope system. I remember a few years ago when I applied for my first credit card, I did not know anything about credit or debit. And I thought it was neat that you can charge your expenses to this piece of plastic and pay it back on your own terms plus interest. Here I am, finally budgeting my money.

Read: How To Manage Your Money - 50 20 30 Budget Rule

I have to say I truly do love it. I look forward to my paydays way more now, it's so fun budgeting and studding my cash envelopes and sharing everything with you.

Let Get Started


Expenses

The first thing you're going to want to do is to list all of your expenses.
Budgeting for Beginners: Cash Envelope System

These are just an example of common expenses, and after listing all of your expenses, what I did was put the due date of the expense next to it. This is completely made up, but we'll pretend these are our expenses.
Budgeting for Beginners: Cash Envelope System

I find that doing it this way is much more convenient and way more organized. 


Sinking Funds

The next thing you want to do is list all of your sinking funds. A sinking fund is anything that maybe you have an annual payment on, such as your car registrations or Amazon price, and if you celebrate Christmas then Christmas would definitely be one. 
Budgeting for Beginners: Cash Envelope System

It's something were you continue saving up for, knowing that it'll eventually come, and when it does come, you will have your payment. And you won't feel guilty about spending that money because that's what it was there for the entire time.

As you can see I have listed our sinking funds in alphabetical order. I preferred that way, but obviously, you can do it however you'd like. Now that we have listed our sinking funds, we are going to go through them and find any of them that is an annual payment and for this, it happens to be the first 3 here. Amazon prime, car maintenance, and Christmas
Budgeting for Beginners: Cash Envelope System

Annual Sinking Funds

Now that we have marked our annual sinking funds. We will want to create a budget for them. The first thing is you are going to find out when each one is due, for that one-time payment.
Budgeting for Beginners: Cash Envelope System

Next, we will be creating the amount due for them, so for amazon prime, I personally pay $60. Car maintenance, let's say we owe $380 and for Christmas, $500 is what we want for our budget.

The way I find this is I make a list of everyone that I want to buy a present for, I give them a budget and I add that total amount due and I divide that by how many checks I have left. Let me explain what I mean by that.

We will start with Amazon prime, this is due June 30th, so I count how many paychecks I have exactly from March until June 30th, that is (9 checks) because I receive my check every 2-weeks. That is twice checks in one month. Hopefully, you got that. Then until October 10th, that is (16 checks). Then until December (22 checks) 

Next, we will be taking the amount due for the annual payment and dividing it by how many checks we have left.
Budgeting for Beginners: Cash Envelope System

Now that we have the annual payments out of the way. We can move on to the rest of the sinking funds. Now we will be determining what our idea amount will be for each sinking fund that we want to put from each paycheck. We already know what amazon prime will need $7 from each paycheck, car maintenance we need $24, and Christmas will get $23.

Budgeting for Beginners: Cash Envelope System

I put $10 into my clothing envelop because I don't buy cloth a lot. As the list goes on, you can arrange your own list as you want, this is just my own idea.

You're going to need to figure out how much money you use for gas in one week and double that if you get paid by weekly, next is gift, make sure you know how much you need for gifts and whose birthday or any celebration that's coming up in advance, so you're not scrambling for money for gifts.

If you have any pets, you want to make sure they have their own envelope for anything that they might need. Your savings is up to you.

I put $10 into my work envelope and that money is for anything that I need for work.

Like I mention before, this is entirely up to you, this was just my little input on this and I hope you find it very helpful. 


My Expenses

Budgeting for Beginners: Cash Envelope System

Now we will be taking that total amount due and dividing it up into check number 1 and check number 2.

Now that we have our budget laid out for us, let's pretend check number one that we get paid $1,092, and subtract our total from check number one which is $705 = $387. That $387 we are solely for our sinking funds.




I hope this makes sense to you. I try my best to go through it thoroughly.

Tuesday, 19 November 2019

6 Worst Investments That You Can Make

Worst Investments

I'm going to share 6 investments that you may want to think twice about before dumping money into these different types of investments and this isn't to say that all six of these are not going to be poor decisions 100% of the time. Sometimes they can be a good idea, sometimes they can be a bad idea, but in a lot of cases, the drawbacks of these investments can outweigh the benefits of these different types of investments that I'm going to share with you in this article.

Just keep in mind, this does not constitute as financial advisers, this is just a piece of free information on the Internet for anyone and everyone who's willing to read.

Let's Get Started


1. Relying On Pension/ Social Security Payment For The Future.

I believe it's about 85% of pension funds are still available even when a company goes bankrupt. So if you worked for Enron in the 90s and you're getting ready to retire and you're banking on that pension fund and all of the sudden, the company goes to crap, look, you'll probably still get that pension fund, I don't know how that worked out for the employees of Enron.

Read Bad Investing Habits You Need to Break

But most people even when a company goes bankrupt will still get a pension fund about 85%, but you don't want to bank on it, you don't want to bank on anything where somebody's promising you money in the future. Just like social security from the US government, if you're 20, and you're hoping or expecting to get money from the government when you're in your 60s or 70s. Forty years from now. That's not a great idea, you don't want to factor that into your finances at the moment. 


2. Investing Into Crypto Currencies That You Don't Understand.

It's okay to invest into cryptocurrencies, but the key here is to make sure you understand what you're actually investing into and this is the problem with the cryptocurrency market is that a lot of people will jump into it with no idea what the currency actually does, no idea what it's about, who created it. Although I guess nobody really knows who created Bitcoin.

But not much knowledge on the topic and then jumping into it. If you understand it, maybe you understand blockchain and you understand how it's functioning and how you could use this certain type of currency in the future, then maybe that's okay. but if you're just jumping into it because you think you can make more money off of it, you're just gambling.

Like I said, it's okay if you know how this currency is functioning and you see the prospects for it in the future, but just make sure there's more something more than just thinking that you're going to make more money or watching your friend make money and say I want to make money on this too, no idea what it's about, throwing money into it, I don't really think that's a great idea as far as investing.

The whole point of investing is to minimize risk while maximizing potential returns, that's why we make an investment.


3. No Diversification

I've actually made this mistake in the past as well, but it's important to diversify to a certain extent, you don't want to go crazy about diversifying and put money into a hundred different types of investments. Like I said, I made this mistake in the past where I would put a lot of money in one particular stock and then everything could be going well, company earning could be going very well, and all of sudden, there's a big scandal, boom, company stock drops 30% and it slides down or maybe there are certain lawsuits that go on with the company. 

Something that you might not foresee that if you have all of your life savings in one particular stock it could be a drawback and it could end up hurting you in the long run. Make sure that you diversify a little bit and like I said, this is up to you on what you want to do, you make your own financial decisions here, but consider diversifying a little bit.

What you wouldn't do was putting all of your money in collectibles, you don't want to put all of your money in one stock or all of your money in something else that could precious metals, because you don't truly know where it's going to be and it's good to spread things out a little bit to create that safety. because if one industry goes down, maybe your real estate investments could pick up for that industry that's going down.


4. Penny Stocks

Penny stocks from the outside can look like a really interesting opportunity and honestly they can be. But I want to caution you on penny stocks a little bit because there are some drawbacks or some downsides that not many people foresee, but it's something that you want to think about.

The reason why I tend to not really like penny stocks is because there is generally less information about them than there would be with a company like Nike, Apple or coca-cola that are very much under the public eye, they have to report to the security exchange commission , so in a lot of cases, it's difficult for those companies to commit fraud or to do some other types of malicious activities.

But with penny stocks, a lot of them are traded what are called over-the-counter, what this means is that there generally is going to be less information about them. It could be more difficult to get their financial reports in some cases not even available for financial reports, but they can also be susceptible to different types of scams, which is a reason why I'm not a big fan of them.

One of them is something called pumping and dumping, you hate to see it happen, it still does happen, what happens is people will pump up the price of a stocks by buying it when it's $0.1 per share and then pump up the price by creating news about it, telling everybody to buy the stock, going to forum maybe going online somewhere, and getting other people to buy the stocks.

They pump up the price of the stock and then when it gets up to the point that they want it to be at, let's say $0.20 or $0.30, they sell, and they sell thousands of share and they essentially dump the stock. They dump it and they usually end up in jail because it's illegal, but it does happen.

You really need to be careful because there are a lot of downsides to it. You can totally go about this on your own, but if you're going to invest, maybe start with the smaller amount of money just like with any of these investments, any investment whatsoever, when you're first getting your feet wet, start with a smaller amount of money to learn the ropes of that different types of investment, that's just one piece of advice that I could have.


5. Collectibles

Investing heavily into collectibles. I said heavily because it's ok to invest a little bit of money into some different types of collectibles, but putting all of your savings say Star Wars figurines or certain types of stamps that you believe will be very high value in the future, can be a little bit tricky, and the reason for this is because it's difficult to predict if people are going to want Star Wars memorabilia in 40-years.

It might be a little bit difficult to actually predict that and because of that, it's a little bit more speculative. So I'm not a big fan of that one as well. Now, there are also certain types of collectibles that could be smarter decisions, you might be able to hold your value with some of these collectibles, but if you're buying baseball cards and you're hoping that the value of them is going to be very high in 40 years or 50 years, it's just difficult to predict it. It's okay to maybe put a little bit into it to diversify a little bit, there's nothing wrong in that.


6. Ponzi Schemes

The worst investment that you can consider is bic connect, we're not talking about bic connect, we're actually talking about Ponzi schemes, pyramid schemes, or even in some cases certain multi-level marketing schemes as well.

Whenever you see some types of investments say big connect, this was essentially a multi-billion dollar scheme that was going on within the online world about a year ago. They where offering guaranteed returns of 1% daily returns on your investment, don't quote me on those precise numbers.

But they were offering guaranteed returns if you were investing with them and anytime you see guaranteed return especially when they're high of 1% per day which is considerably high returns, you want to be very wary of that, you want to consider where's this money actually coming from. It's the biggest red flag possible when somebody's promising returns.

This happens not only with certain things like Bic connect but also with Ponzi schemes like Bernie Madoff, he was regarded as one of the best investors at the time, he was managing billions of dollars worth of assets for a lot of clients, a lot of high-level clients, but it was all just a smokescreen, he was actually scamming people and creating a Ponzi scheme where he was relying off of more money coming in to pay out investor as profits, but it was money that was coming in from new investors. So he had to continuously attract new investors and it all went to crap when the great recession hit and he had a lot of problems and now he's in jail.

But you want to avoid the Ponzi scheme, pyramid schemes and different types of activities such as those. To see how these are working to actually be able to identify them. There's a list of different things that you can look, 


  • One of the biggest ones is guaranteed returns 
  • Returns that are looking astronomical, that look out of place and wondering where's this money coming from.
  • If they're not being upfront about how they're making their money, if they're not telling you how they're making their money, be a little bit wary of it and do a little bit more research into it to make sure, that it's not a Ponzi scheme or pyramid scheme and that's just something that I think you really want to think about.



Hopefully, you enjoy reading our article

Saturday, 16 November 2019

Simplest Budgeting Method To Save Money Ever

Budgeting

In this article, I'm going to share one of the simplest strategies for budgeting and saving money so you can build a better financial future for yourself. I think this is something that many people overlook but it is by far the most important aspect of personal finance. 

I have friends who are making $2,000 to $3,000 per year, yet they're still broke because they don't know how to manage their finances properly. It doesn't matter if you're making $10,000 a year or $10 million-dollar a year, it's very important to take this systematic approach for budgeting and saving money, investing money, and doing it properly.

I'm going to share a couple of different strategies that you can use in this article right now.

Lets Get Started


Why Do You Want To Create A Budget

It's important to understand your reason for creating a budget for wanting to save money. And in many cases people just saying well, I want to save money and increase my wealth. Who wouldn't? But you want to dig a little bit deeper than that, because, this is what can help drive you towards reaching those goals and setting those goals that you may have. And that is by understanding your why. 

Maybe you have a wedding coming up, maybe you want to go on a worldwide trip around the would for a year and you need to save some money for it. Or maybe you just want to retire much earlier than the average American who retires at age 63, maybe you want to retire at age 50, 45, 35, some people can retire at an early age because they're able to do a budget.


Run Yourself Like A Business

One of these things that I think is so important to do and I've been doing this for a number of years, the way of viewing this is to run yourself like a business. I run myself like a business with my personal finances. Imagine a business trying to profit, trying to make money without tracking their expenses, without writing down all of their expenses and all of their income. Imagine a business trying to do that, how would they know the profitability, how would they profit? In many cases, they wouldn't. That's how 90% of people in the world are, they don't keep track of it, they try to run the numbers in their heard.

Businesses will have a number of different financial sheets, they have a number of different things that they go through and track numbers on.


Cash Flow Statement

It's not difficult to understand the basic concepts of this, but let me just show you one here. You can plug in all of your income, any money that you might have coming into your bank account or coming into your possession, maybe it's your salary, maybe you're on an hourly wage, whatever it maybe be, you have a pension coming in, some type of retirement funds, you have social security payment or maybe you have dividend payments from stocks. Whatever income might be coming in would be your total income for that month.



Expenses

Once you fill out all of your income, then you want to fill out all of your expenses. There's a lot of expenses that many people don't think about. And this is why budgeting is so important because all of a sudden, you realize the payment on your credit card bill that you've absolutely no idea what it is and it turns out to be that ancestry.com thing that you signed up for 4 years age, that you have been paying in many time because you haven't look at your credit card statement. Because you haven't analyzed all of your expenses, so take some time and understand where all of this money's going.


  • I find this interesting because a lot of people will not do this and the reason for it is because they are afraid to run a budget because they know how much they owe. They know they have a lot of credit card debt, $2,000 in student loans, a $20,000 car payment, and they don't want to look at it.

But this is one of the best things you can do to confront reality, to confront the problem that you have, maybe you are in debt, confront it and then track it. if you do this on a monthly basis you can start to see that progress. Or maybe you're getting worse, but trust me, if you're getting worse, you're either going to do one of these two things.

  1. You're going to fix that problem and start increasing your wealth. 
  2. You're going to stop using the budget and just totally not think about it. 

But hopefully, it's the first one, not the second one.



Hopefully, you find some value in this article.

How To Retire Early - 3 Secret Step To Follow

Retire Early

The average Americans retire around age 62 or 63. But how is it that some people are able to retire at age 50, age 40, and even in some cases in their upper 20s or early 30s. How is this possible. I'm going to share that with you in this article. There are 3 simple steps that you can follow in order to shave 5, 10, 15 years off of your project retirement dates.

Let Get Started


1. Proper Budgeting

Most people think that the first step to retiring early is to make more money. To get a pay raise, to increase your income so that you can retire at an earlier age, but to be honest, that's not the number one step, that's not the first step that you should be taking, and the reason for that is because there's something called lifestyle inflation.

This is the exact reason why a lot of lottery winners go broke 5-years later. This is why a lot of professional athletes go broke after they ended their careers. And the reason for that is because they inflate their lifestyle as their income goes up. So number one step it's not making it. It is a factor. It's obviously an important factor that goes into it, I'll talk about that later in this article.

But the first step towards retiring at an earlier age is by cutting expenses and budgeting correctly.

I want you to hear me out on this. A lot of people when they get their paycheck, they just spend everything and at the end of the month, they don't have any money to save. But what you should be doing is setting money aside for retirement or for savings before you spend it on any of your needs or wants or anything else that you might be doing.

Read: How Much Should You Spend Annually In Retirement? 4% Rule & Safe Withdrawal

The best way to do this, there's a strategy called the 50/30/20 rule. You can read the article below.

Read: How To Manage Your Money - 50 20 30 Budget Rule

But let me explain this to you, I think this could help you out a lot and you know what, if most people follow this simple rule, they would probably retire even earlier than the average American which is about 62 or 63, just by following this you could probably shave off a few years because most people can't even do this.

Again, read. How To Manage Your Money - 50 20 30 Budget Rule

Take the first step of cutting your expenses and budgeting correctly, without being Scrooge, without being a weirdo, but able to do that. I think if you're not running a budget this creates such a problem because thinking about a business.

Imaging a business trying to run themselves without tracking their expenses, without running a budget, without having a balance sheet. Run yourself like a business, you don't want to be weird about it but understand where the money is coming in, where it's going out, and if you can track that, you're going to be so much better off for success.


2. Increase Income

After we think about saving or budgeting and then we can start thinking about ways to make more money. There are a couple different strategies for this but the best routes to go for is by finding a way to monetize a hobby. 

If you're working a job that you already don't like, I think the statistics are about 80% to 85% of people aren't very satisfied with their job. So if you're working a job that you're not very happy with, then maybe picking up a side hustle or a job after work or on the weekends might not always be the best option because you don't want to just work 80 hours a week of something that you're enjoying. There's really no point in that.

But maybe find a way to monetize a hobby. For example, if you enjoy making homebrew, you can start a little microbrewery and start selling that and making money on the side and then take that money and put all of that money from your side hustle, your side job, your side business, put it directly into your retirement.

Instead of the 50 30 20 rule, if you read that article, you could almost make it the 50 30 50 rule. You're taking that extra 20% of your income that's coming in on top of your regular income and putting all of it directly into your retirement funds, or your savings, your investment, so that you can get to retirement so much faster just by doing that. Find a way to monetize something that you enjoy.


3. Smart Investments

It's really important to think about ways to get your money to work for you. Maybe you don't trust the stock market right now, maybe you don't want to get into real estate. There are other options to at least keep up with inflations, whatever you're doing you want to put it into something that's gaining a little bit of a return on your investment versus just saving it in a bank account it's not going to get you to retire early. It's hard to save your way towards retirement.



Hopefully, this article helps you out a little bit.

Thursday, 14 November 2019

8 Money Traps To Avoid In Your 20s

8 Money Traps To Avoid In Your 20s

In this article, we're taking a look at 8 pitfalls that people fall into, especially in their 20s and their 30s. I would suggest paying close attention to maybe bookmark this page or take some notes on this. Because some of these could really be beneficial for you.

Generally speaking, people from the young 20s will probably receive some type of influx of cash, maybe you just graduated college or you've been in the workforce for quite some time. But hopefully, you're starting to see some more pay increases while having fewer responsibilities.

Maybe you don't have kids, you don't a lot of expenses and a lot of a whole mortgage to pay. So if you're in that situation then you want to avoid some of these situations that can end up costing you a lot of money in the process.

Let's Get Started


1. Expensive Relationships 

Spending exorbitant amounts of money on relationships. I want you to hear me out on this because, first of all, the money aspect of relationships should be down on the important things in a relationship.

But if you're going to try to spend money to impress somebody, especially if you're on a lower income and you're trying to take them on like $300 dinner dates and thousand-dollar weekend trips and buy them jewelry and everything. If you're going to try to do that and it's not sustainable. You're creating a false image of yourself and that's probably not a good look for the long run.

Read: How To Save Money (6 Easiest Way)

If you end up running out of money and you're making them expect that from you because you're buying them a lot of stuff and then one day you say I can't buy anything anymore because I spend all my money. It's not always the best situation. 

I'm not a relationship coach, so I'm not going to give too much advice on that. but I just want you to be aware that spending a lot of money on people is not always the most important thing.

There's like a thousand other things that are more important than spending money on other people. You want to think about that. Because it can kill people's wallets when they try to look cool and rich to impress somebody. It's not always the best option to take.


2. Not Spending On Their Passion

I'm not taking money into the grave with me. Once I'm dead, I'm dead. And because of that, I like to spend money on my passion and for me personally. It's traveling, I like traveling. I was just over in Europe and I'm in Israel, I'm going to Amsterdam next week. And that's because I'm able to set money aside to spend on things that I actually want to spend it on.

I would suggest you doing that for yourself as well, a lot of people spend money on different things but at the end of the month, they don't have any money left over for their passion. Maybe you love music and you want to buy a nice Martin guitar, maybe you want to buy a camera, but you don't have the money for it, because you've spent it on different things.

Start setting money aside for your passion. Maybe create a separate bank account, I don't care what you do but put money aside so you can spend it on things that you want in your life. That's why I write this article in the first place, I don't write it so people can just be a Scrooge and have a pile of cash on their desk.

If you're looking at a pile of cash, it's not going to do anything for you, sure it might look like a lot of money but if you're not spending it, what's the point. 


3. Thirty-Thousandairs

30,000 airs are people who are making less than $100,000 per year. but they're walking into a bar trying to buy out the bar, put drinks all around for everybody, spending a lot of money when they go out. Essentially trying to look rich, trying to look like they have a lot of money than they have at the moment.

There is this idea of faking it until you make it. And that actually does hold true to an extent. But instead of buying out a bar, maybe think about other ways to fake it till you become it. For example, buying a nice suit, buying a nice watch, getting nice shoes, getting a nice haircut. Taking care of yourself and being formal and professional can have a much greater effect than going to a bar, getting drunk and spending a lot of money on people.

While alcohol might be fun and it's a social lubricant, it's also a big lubricant on your wallet and you end up spending a lot more on that. Think about ways to cut back on that potentially, maybe consider drinking before you go out to the bar so you're not spending $200 on drinks at the bar.

Those are just some tips because I know 20-year-olds people like to have fun, and it's important to have fun, just make sure you're doing it correctly without blowing all of your money especially on the weekends because that happens to a lot of people.


4. Avoiding 401k Opportunity

The worst pitfalls that people fall into as a millennial, as a 20 or 30-year-old is by not taking advantage of the 401k opportunities, by not putting money into their IRAs. And if you're in a different country, essentially just not putting money into your retirement accounts.

When you're in your 20s it's not cool to be thrown money into your retirement account, you think I'm not retiring for 30 years or 40 years from now, I'll think about it later.

But trust me, if you ask anybody who is in their 30s or 40s and you say, do you wish that you put more money into investments when you were in your 20s, a lot of them are going to say yeah I really do, because I'm playing catchup and I'm trying to catch up and put a lot of money in my 30s and 40s, instead of being proactive about it.

Taking some of your income and putting it into investments, especially if you have a 401k offered by an organization, your company, and they're offering to match some of your contributions. I would personally take full advantage of that, I'm not a financial advisor, so you can do what you want, but I would personally take full advantage of that because that is free money if they're matching your inputs.


5. Speculative Investments.

Dropping a lot of money on a speculative investment. I personally fall into this category in the past, and maybe you have as well. But people who are in their 20s, 30s, you might get some hot stock tip or some hot cryptocurrency tip, and you think about getting into it and dumping $10,000 into it because you think overnight you might make $100,000. And that would be life-changing.

There's a clear difference between investing and speculating. And that's the first chapter of the "intelligent investor", one of the best investing books of all time.

It's important to ask yourself, am I investing or am I gambling on this. You need to understand your reasoning for getting into any of these particular investments. We just talk about the importance of investing, but you want to make sure you're doing it right, and you're limiting risk and increasing the potential reward. That's what investing is all about.

What I personally do, if I find myself about potentially getting into some type of investment on a whim, I'll take out a piece of paper and a pen, write down the pros and cons, the risk, the rewards, and why I'm trying to get into this, other than just rich, especially get rich quick. You want to be careful about that. Sometimes there can be some good deals, sometimes you can get a nice stock tip that could work out well. But you need to understand why you're getting into it.

If you can list a lot of reasons and a lot of the cons behind it and understand the risk and rewards then maybe that's something you could consider getting into, but I just want to caution you on that because I've seen people lose a lot of money.


6. No Money Down Plane

No money down for a mattress, you only have to pay $40 a month the next 4 years for this $4,000 mattress. But the issue with this is that, first of all, you're paying probably 10% APR or higher on all of these small loans. But they do add up especially when you get baited into a bunch of different no money down plans.

You got a new mattress, $40 a month, a new dishwasher, $25 a month, you get a laptop and you get that on zero $0 down for the next 3 years, you get the iPhone. And you end up having like 6, 7, 8 of these different bills that might seem small like $40 a month or less, but they can add up and start to pinch your wallet.

You're getting a couple hundred dollars a month that you owe to all these different organizations and you're probably paying a decent amount of interest on that. What I would consider doing, just buy it in cash, and if you can't afford a nice mattress, then maybe you should get a less expensive mattress instead of getting expense one for like $30 a month or $40 a month.

As Clark Kent has said in the past, I heard one of his videos, he said look, if you can't afford to buy 10 of an item, maybe consider not buying one of that item. It's a good rule to live by so that you end up not spending too much money on something that maybe you can't afford.


7. Buying New/Luxury Cars

Cars keep people poor. The average cost of owning and operating a vehicle according to the Bureau of Labor Statistics is about $9,000 per year. Buying a new car, buying a luxury car when you're in your 20s, is not a good move for the majority of people. That's because cars are depreciating assets, they're losing value every year.

If you buy a new car from a dealership and you want to return it a week later, sell it back to the dealership, you're going to get offered at least a couple of thousand dollars less on that vehicle. Possibly even more, just because you bought it, it's in your name and you're selling it back to the dealership, they're not going to give you a lot of money for it and instantly lose money.

I would suggest buying vehicles that are at least a couple of years old. If you live in a big city that has a lot of public transportation, you have no need to use a car very often, then I would consider not even having a car if you don't need one.

Wednesday, 13 November 2019

How To Save Money (6 Easiest Way)

Budgeting

We're going to be taking a look at 6 different strategies that you can implement in order to save some money. Everybody wants to have some more discretionary income and that's the point of this article. We can have more money to spend on the things that we want in life instead of ending up in credit card debt and being swamped with bills. Hopefully, this article is helpful.


1. Limit Credit Card Use (Last Resort)

I want to clear this up here because this can sound a little bit weird at first. Because credit cards are very important to build your credit score. I have a lot of credit cards, I use them and they're really effective in order to build my credit score and I get credit rewards on that. But as Dave Ramsey says many times, credit cards, you're going to end up spending a little more money.

Read: How To Manage Your Money - 50 20 30 Budget Rule

Maybe it's only a couple percent more, but you generally will spend more and that is because you don't have this sort of physical attachment to it, because you're swiping a piece of plastic or you're putting in the chip reader, but you don't actually lose anything, nothing leaves your hands.

What if you're buying stuff in cash, you're handing over that cash and it can be painful if you're handing over $100 bills versus just swiping a piece of plastic. Hopefully, you can see how that could psychologically affect you a little bit. 

If you're falling into that trap of spending too much money, you find yourself in credit card debt, maybe consider putting those credit cards in your desk drawer, only using them once or twice a month just to keep your credit score going.

Leave those credit cards at home, don't use them as much if you fall into that category where you're racking up credit card debt and it's starting to get out of control and you really do need to start saving money. That's a possibility for you


2. Set Specific Goals 

You don't want to set a goal of saving money. You want to set time-specific goals with monetary value. Let say, in the next 4 weeks, I want to save $1,000, or in 2020, I want to save $20,000. You set these goals, and then you'll be more motivated to hit those goals.

You can write it down, even put it up on your wall if you need to put a sticky note on your wall or on your computer in order to help yourself to save this money, just to keep it in your head. Written down specific goals will help you in the future.


3. Automatic Bank Transfers

There is something else you can do and it's very simple, it only takes about 5 minutes to set up and this is by setting up an automatic transfer from your checking account to your savings account. Or from your checking account to your brokerage account or your retirement account.

This is very easy to do, you can find this on your banking website in the next 5 minutes. Let's say you get paid $2,000 a month, on the day that you get paid, you can set up automatic transfers, when $2,000 comes into your bank account, $500 of it automatically gets transferred to your savings account. 

Then you live off of that $1,500 and almost pretend or trick yourself into thinking that you're only making $1,500 every month instead of $2,000. It's a cool little method that does work and I've seen people use it and it really does help them and save some money.


4. Create A Monthly Budget

This sounds so simple but it's really important. There's a reason why companies, businesses, will have a financial statement. So they have income statements, cash flow statements, they have balance sheets and there's a reason for. It's because they use these so that they can be more profitable, they can see the weaknesses, they can see where they're excelling and they can see where they can prepare and excel in the future.

You can do this yourself, I'm not saying run yourself like a business, but if you calculate all of your assets, your liabilities, you know where your money is coming in, where it's going out. It's really going to be effective in saving money, you can automatically save a couple hundred dollars per month and just by laying out a monthly budget.


5. Use The 24 Hour Rule

I'm not sure where this came from but it's straightforward. If you make spontaneous purchases on the internet like I do, where you're scrolling through Amazon and you get hit with one of those ads on Instagram and they look really cool, you can buy $250 shoes and then all of a sudden, the next thing you know you end up with shoes at your door a couple days later, because you ordered something online. Very spontaneously.

The 24-hour rule is very simple, you just sleep on it, think about it for 24-hours and then make your purchase, it sounds so simple. But it can save you a lot of money. Don't just buy things spontaneously, make sure you think about them for a longer period of time and you're going to find yourself just saving more money.


6. Price Matching

I don't really see people doing it often, and this is by price matching stores against each other. I'm not talking about price matching a cup of soup from Walmart to other stores, you don't have to cheap out that much. But we're talking about price matching larger ticket items.

If I go to BestBuy, something that I usually do before I buy something is I'll look it up online and find some cheaper prices and I'll go to Bestbuy and say hey, Walmart selling it for $40 cheaper, you can just give me $40 off, and they say yeah sure.

It's good to price match stores against each other and you can do this not only for stores like Bestbuy and Walmart and others. But you can do it for places like if you're buying a mattress, you can bid competitors against each other.

Anything that's over $1,000, you can find yourself trying to get a better price and you can save a lot of money in the process. Don't be afraid to ask for a better price especially if it's something that's a bit ticket item.

Tuesday, 12 November 2019

5 Steps To Get An 800 Credit Score In 45 Days

Credit Score

In this article, I'm going to share with you 5 different tactics that you can utilize to grow your credit score as fast as possible. The big issue with credit score is that they usually take a long time to build up, but in this article, I'm going to share with you a few different tactics that you could use to grow a lot faster.

If you need to boost it in the next 30 days, 60 days, 90 days, I think this article might help you out.


Let's Get Started

Let's start with the most important one that can boost your score very quickly, I'm talking 30 days, 45 days, maybe 60 days and you can boost your score very quickly, this is great for people who have no credit history or possibly bad credit history. Anything below 600 isn't necessarily too good for credit score.

Read: 7 Factors Affecting Your Credit Score To Dropped

It's okay if you have a bad credit score, you can build it up over time, and that's the key here.


1. Authorized User Strategy

One of the best ways to do this is by becoming an authorized user under somebody else's account. I'm going to leave a couple of links down below, some source from discover and credit karma, just to sort of giving you more information about this. Because there's a lot of misconceptions about becoming an authorized user and how you can piggyback off of somebody else's credit score, but it's totally possible if you do it right.

https://www.creditkarma.com/credit-cards/i/authorized-user-credit-card/

https://www.discover.com/credit-cards/resources/authorized-user-and-credit-scores/

Read: How to Check Your Credit Score For Free

You can become an authorized user under somebody else's account so this could be your parent, sister, brother, even your kid if they have a good credit score with a long credit history or a friend, and if they have good credit, I would say anywhere from 750 to 760 and above.

They can add you as an authorized user. What's going to happen is, you're going to get a credit card with your name on it, but it's under their account, so they're legally liable to pay off your bills in a sense, and you personally as the authorized user aren't liable for this. 


One of the biggest questions that people ask is, "if I was the person who is letting somebody become an authorized user under me, am I going to be affected by their poor credit history"? The truth is No. You're not going to be.

  • Let say your parents were adding you as an authorized user, your parent's credit is not going to be affected by you being on there as an authorized user. Just keep that in mind and share that with them if you're trying to convince somebody to add you to their credit card as an authorized user.

Co-signing

You want to be careful with co-signing, this is another method that people use. Co-signing can create some problems because what you're going to have to do eventually is close that account and that can hit your credit score a little. We can talk more about co-signing and the negatives of that in the future. It's not always bad, but I think becoming an authorized user could be a better bet for a lot of people.


Here's The Part Where You Really Have To Pay Attention

What can usually happen and what does typically happen is that you as the authorized user, you'll get reported to the major credit bureaus, "the people who score credit scores". You'll actually get reported separately from the person who added you as an authorized user. So all of a sudden, you basically piggyback off of the person who signed up for you.

If they have a credit score of 800, and you're an authorized user under them, there's a good chance assuming that they report you separately which typically does happen, your score will go up tremendously, I'm talking 50 points, maybe even a 100 points or more sometimes. There are stories of people jumping even 120 points, 130 points in literally just 30 days from this happening. 

Here's The Second Part Where You Really Have To Pay Attention

Because this isn't always the case.

After the subprime mortgage crisis of 2007. FICO changed the way that they score credit scores and how they look at them. And now, they actually way the authorized user piggybacking method a little bit less.

What can happen is that, just because your credit score shoots up. You sort of piggyback off of this person's credit score. Let's say your score goes from 580 to 690. Your score goes from bad to decent, shoots up to 690, and you apply for a new credit card or you apply for a mortgage or an auto loan.


What can happen with some bank's, they can look deeper into it and say wait a minute, you're just an authorized user, you never had a credit card where you actually pay off yourself, and they can look deeper into it and they can reject you for some of those loans.

It's not always the best method, but it's a great way to boost it initially and sometimes they do use old methods for pulling credit and they're not really looking too deep into it, they're just looking at the number, but like i said, ever since 2007, they've been getting a little bit smarter with that. But it's still a great way to boost it very quickly.


Open Up A Secured Line Of Credit Separately

Another method you could use while you're doing this authorized user piggyback method. You can also open up a secured line of credit separately to sort of help boost it a little bit more. 

That's just an important tip that a lot of people don't even know it really exists. If you have poor credit or you have no credit, definitely look into that one, it's definitely a tremendous way to boost your credit as fast as possible.


There are 4 other strategies that you should be aware of if you're trying to grow your credit score as fast as possible.


2. Dispute Mistakes In Credit Report

Another thing that a lot of people don't realize you can do, is by writing to the credit bureaus. I'm talking about a physical letter writing to the 3 major credit bureaus and disputing certain things on your own credit report.

Just to give you an example of this,

There was a man who got divorced and his wife was settled by the courts that she legally owed him a certain amount of money for certain payments that was under his name and she didn't pay him, so he couldn't pay off the loans, so he defaulted on the loan. Hopefully, you that there.

He defaulted on the loans and then he got screwed over, and his credit score tanked, well, he actually disputed this and he got it taken off by writing to the credit bureaus.

Sometimes there are some smaller things, like missed payments that you might have miss 3-years ago, you can actually write letters and dispute this, if I were you I would google this, there's all sort of PDFs and different outlines that you could use to fill in the blank type of things that you could use to send these letters to credit bureaus.

As soon as this happens, as soon as you get some of these old things that are dragging down your credit score, as soon as you get them off. All of a sudden, your credit score can shoot up very quickly. I'm talking about 30 to 60 days, it can shoot up very quickly.


3. Avoid Hard Pulls (Short Run)

This is really important, let say that 2 to 3 months from now you are thinking about getting a new car, and you want to get a $20,000 loan for your new car, let say it's 45 or 60 days from now. You're going to want to plan this out a couple of months before, and not getting any hard poll on your credit.

What this can mean is
  • Don't try to open up more credit cards 60 days before trying to get a car loan. 
  • Don't try to get a car loan right before you try to get a home loan.

There's a couple example there of how they could negatively affect your credit. Because every time somebody is doing a poll on your credit, every time somebody is checking your credit in a hard poll, not a soft poll, there's a difference there.

With a hard pull on your credit, it's actually going to decreases your credit score, sometimes 10, 15, 20 points, or more, for a hard pull on your credit, so in the short run, keep that in mind, try to avoid those hard pulls.

In the long run it doesn't really matter so much, if you're thinking about getting a house next year, it doesn't really matter if you open up a credit card now, it might dip your score by 10 or 20 points but not too much, so I wouldn't worry about it in long run.


4 Low Utilization Rate

I'm talking about anywhere from 1% to 10%. Once you get off higher than 10%, that's when you're going to start to get into the territory where these credit card companies are going to find you a little bit riskier. And your credit score is going to decrease ever so slightly.

I try to keep my credit utilization at 3 4 5 percent. What this means is that, if you have a credit limit of $10,000, you're probably going to want to spend maybe $500 or less per month out of your $10,000 limit. Just to keep that utilization low.

Once you get up to 10% to 40% or more, that's when you're going to see your credit score starting to slip a little bit. So keep it very low. This makes up a very large portion of your score, just keep that in mind.


5. Never Miss A Payment Every Month

Sometimes we'll see people who will rack up $3,000 in credit card bills for a particular month, and then they'll say I have $3,000, I can't pay it off, so they'll just forget about it and just say you know what, I'll pay it off next month. And they don't pay the minimum payment.

As soon as you don't pay the minimum payment, it counts as a default and your credit score is going to get hit really hard for not paying off that minimum payment.

If you're going to carry a balance but I wouldn't recommend doing, because you're paying 20% to 25% interest sometimes on those balances on your credit, well, if you're going to do that at least pay off the minimum payment every month. It's so incredibly important to do that. It's a foolish mistake not to, and it's going to hurt you for quite literally years to come if you just miss that one payment.

What I do is I set up auto payment directly from my bank to my credit cards, so that I will never ever forget about it and that saves me a lot of worry instead of trying to time it perfectly and paying off your credit card right before it's due.


Conclusion

I think the biggest problem people have, they want to increase their credit scores like next week or 2 weeks and it's not that easy to do that. I think the first 2 methods that I share with you are very important and those are probably the best ways to increase it in the short run, but in reality, it's going to take a long time to build credit.



Those are 5 different tactics that you could utilize to increase your credit score as fas as possible. Thanks for reading our article.

Monday, 11 November 2019

15 Side Hustle Ideas To Make Money as a College Student

Side Hustle Ideas

Today I got 15 ideas to make money on the side for college students. Some of them exchanging your time for money and others are passive income routes. There is no mention of surveys, surveys in my opinion not worth it. I am going to start with 5 passive income routes because these are my favorite.


Below are 5 Passive income Side Hustle

1. Sell Last Semesters Study Notes

If you are a college or university student, you can actually sell your notes online. I did this after high school, I sold my HSC notes, there are heaps of websites that act as a middleman for you to sell your notes to them and they sell them to other people. Go to Google and type in "how to sell study notes Australia" add your own country.

This is a passive income stream because every time someone buys your notes, you get some money.


2. Sell Designs To Canva

If you're a little bit artsy and you can draw, you can sell your design to canvas. Canva is a website for making the graphic design really easy and I was designing an invitation for a friend the other day, I end up buying one of their designs, it's only $2. And then I thought, for that person, that's a passive income that comes in whenever someone buys the design.

Drawing designs would actually be so easy I have an app on my phone called the Adobe Illustrator app, and you can just draw on your phone, so simple, or if you got a graphics tablet, you can draw on your computer.

Read 8 Uncommon Side Hustles To Make Money 2019/2020


3. Design And Sell T-shits

There's a website that I came across called bonfire.com and you can upload your design and then set a limit of how many shirts you want to sell, you choose how much profit you want and then you launch your campaign, and you set a minimum number of shirts that you would like to sell and when you reach that minimum number, the shirts will be shipped out, you'll get your get money. It's very simple.

It's the kind of thing that you can just set-up and leaves, and the money will start coming in. There are heaps of different websites you can choose, bonfire is just the one that I used before.


3. Make An Ebook

The simple one to do is a recipe ebook, and I think the key here is to find something specific, it could be a specific diet like raw vegan, paleo, or baking recipes for celiacs who go to the gym. Bulk recipes that are easy to make for childcare centers 

Because you want something that's allergy-friendly, not too spicy and the recipe can be made in bulk and it's quick to make, do you see what I'm getting out here? Like something very specific for a specific targeted audience. It doesn't have to be a recipe ebook, you can write about anything you know. 


Read 4 Side Hustles You Can Do From Home

5. Invest In The Share Market

There is a certain amount of risk involved, but it depends, you can choose how risky you want to go, you can choose to invest in companies that are riskier and there's a potential for quick growth. Or you can choose to invest in something that's going to be a slow steady growth and it's like the safe route and that's good for long term investing.


The Next Idea Below Are Not Passive Income

They're more of an exchanging your time for money


6. Rentafriend.com

I heard about it and thought it would be worthwhile including in this article. It's called rent a friend and some people just want someone to hang out with. This is a great way to improve your social skills and earn a little bit of money on the side. People will just hire you out as a friend.


7. Taskrabbit

There's this app called TaskRabbit and it basically will be just people need who tasks done, like picking up dry cleaning, calling customer service and waiting on hold for 15 minutes, or creating an Excel spreadsheet. It's just really simple tasks that you can do for a little bit of cash.


8. Uber Driving

If you have your full license and a fairly new car then you can just uber drive when you need a bit of extra money.


9. Designated Driver

If you've got a car or if you've got a friend who has a car that they're willing to let you use. This is good if you live on the same campuses with the people, because you can be the designated driver, you can agree to pick these people up at the same time, from the same place, drive them home, you both trust each other, you bring them some tissues and baby wipes, bring some water bottles, maybe you charge $5 to $10 ahead.

Once people on campus know that you're offering this, you'll have more business than you can handle.


10. Braid Hair At a Market Stall

If you can braid hair, you're reasonably good at it, just sit down, put up a sign, "braiding hair this much money" however much you charge and this is the sort of thing that I think would do really well at a local market. 


11. Modeling

The option for modeling is more varied than you might imagine, you can be a fit model, which means, if you have standard height and weight for a certain size, let say you're exactly a size 4 or a size 8, then fashion designers love you. All you have to do is stand there while they take measurements and fit clothes to your body and you're like the standard for that size.

I actually see this all the time at my university, there are little posters like "fashion design students are looking for a fit model if you have these measurements and this height, call this number". And they pay really good.

I'm sure that they usually need someone from every size group so it doesn't matter what size you are, they'll work with you. 

You can also go on to model mayhem.com which is like a freelance modeling website, set up a little profile, put some photos of yourself and a photographer might hire you for some modeling work.


12. Digitize People Photo Albums

This involves getting all their old photo albums and scanning them and organizing them by year. It's the sort of task that a lot of people want to do but they don't have the time to do them themselves. If you have a standard printer, scanner, that's all you need, you can charge per hour or per photo album.


13. Write For Magazines

I did this when I was about 13 to 14 years, and it made me $50 to $100 every time I did it. The magazine I wrote for was Take5, I write book reviews and movie reviews because I was a huge bookworm. If you've got a really interesting life story, you can write an article. 


14. House-sitting or Pet Sitting For People While They're on Holiday.

There's a website called petsonme, you can just register and leave your details there, and when someone wants you to pets sit for them, they will contact you. It's a really excellent option if you're a university student and you just want to have something that's not too intense because pet sitting involves going to the house. 

If you're staying at the house, you can just work on your assignment, otherwise, just drop in and feed them, have a little play with them. Sometimes this is paid, sometimes it's not if the accommodation is included.


15. Dog Walking or Grooming

I have a friend who does dog walking and it seems like the best job ever, if you like dogs. Basically, you can just go to a park and run around with the dogs which are good because it's like exercise for yourself as well.

You can set your own pay depending on how much you do. Do you just take them for a walk, do you take them to an off-leash playground and throw a bowl for them, do you include grooming as well, and it's good because you can choose how much work you want to take on.


Those are the top 15 side hustle for a student, hopefully, this article was helpful