Month: December 2019

Anybody who was not born rich has at some point in their lives been told by somebody else that they need to save a little bit of money from each of their paychecks so that they can be rich when they retire. The only problem with this, slow and passive strategy, is that nobody in their right mind thinks that it is better to be rich decades from now, rather than to be rich in the present. Everybody knows this, but many people stick with a passive investment style just because it’s safe, or because they don’t want to do any research that will help them make more money from investments. If a person does not mind doing some work, and wants to become wealthy while they are still young enough to fully enjoy their wealth, then they need to switch to an aggression investment strategy. 

The difference between a passive investment style, and an aggressive investment style, is in how much money an investor expects to make. A passive investor will typically settle for a return on investment that is a little bit better than inflation. An aggressive investor looks for returns that are much higher. Aggressive investors want to quickly double their money, and sustain this level of return on investment until they decide to stop investing. The difference between a passive investment strategy, and an aggressive investment strategy, can be in the millions and billions. This is why an investment strategy based in the aggression route is right for anybody that wants to live a rich life as quickly as possible.

Since almost everybody wants to be rich, it doesn’t make sense for most of these people to ignore the aggression route, but many people do. People ignore financial strategies centered around aggression routes, because they have been taught to fear them. People are told that aggressive investment strategies are inherently more risky than passive strategies. If a person does not know anything about investing, this is true; but if a person has the knowledge to enter upon an aggressive strategy, there is no reason for them not to embark on it.

Many people believe that it is hard to become an aggressive investor, but in fact it is very easy. It does not take much time for a person to learn how to look for enterprises with above average growth potential, and to properly evaluate them to make sure that they are secure investments. If a person has basic reading comprehension skills, and can do basic math, they can pick good companies to invest in.

The funny thing about an aggressive investment strategy is that if it is done right, it is infinitely safer than a passive style. Recessions are a natural part of the economy. Every decade or so, there is a slump in an industry. In order for a person to truly make sure that recessions don’t affect them, they have to make a lot of money, and aggressively take their finances out of any business that is losing money.

Chutes and Ladders is a game that most children play and love. While the game itself is very simple, it can actually have profound meaning in today’s financial world and what to do in investing.

Playing Chutes and Ladders is fun and it is a game that doesn’t require great skill or a lot of thought. The fun part about this game is its unpredictability. Because one minute you can be ahead and the next minute everything can change. As children, this can be a great game of chance, but as adults, it can be a hard fall when knocked to the bottom. You must understand how to play this game to really get the concept by linking it to the financial world.

Like most board games it has a starting and an ending point. The goal is to cross the finish line first. It has a spinner and everyone takes a turn. The spinner will tell you how many squares you can move. As you move along the board, there are boxes with ladders in them. These boxes allow a person to advance or skip over lines. There are also boxes with chutes and if you are the unlucky one that lands on these sections, you must slide back down and start over again.

Usually, the goal of a game is to finish the quickest and get the higher number on the spinning wheel. But in this game, if you roll a lower number, it seems you get ahead further than being a high roller. In other words, the lower and slower you progress on the board, often times the better you fare in the end.

Many people have lost everything in the financial destruction of our economy. To put it in laymen’s terms, there are two roads that we can each take in life. While some may opt to be a high roller and put all of their investments out there, others prefer to take the slow and steady road. They may start with an investment or two and slowly build rather than placing all their money in risky adventures.

Oftentimes, we don’t see the big picture and how many times must we fall to be able to get up again? What is truly fascinating is the fact that by taking a step back, or being forced to go down the chute like in the game, it can give us a new perspective on how to handle our finances. Some people want to put it all on the table and advance quickly to the top. But the problem with that analogy is that often times we over invest and put our money in risky investments, and that can send us right back to the beginning.

Because the stock market and other investments are a big risk, it is better to take it slow and steady rather than having to start all over again. While any money invested is a risk, if you don’t risk it all then you don’t have to start at the beginning again. While it may be a set-back, it isn’t enough to send you back to the starting line. Chutes and Ladders is just a game, but isn’t investing and keeping our nest egg protected?

Starting a business is always a great way to make more income. People that desire to make more should take the time to expand their income through the home based business model. This is a great place to start because there is no money that has to be spent on a physical location. This cuts down on operating costs and gives the business a better chance of surviving. People that start up businesses at home are also out of less money in the event that the business fails.

Marketing

Home based businesses are popular because these businesses don’t require as much start-up money. This is not to say, however, that the business doesn’t have any start-up costs. There is a certain amount of marketing that has to be done in order to gain recognition. In fact, home businesses have to advertise more because there is no storefront for people to pass by. There will be no random patrons that wonder in off the streets. To the contrary, business owners with home based business will have to do what it takes to get customers to notice them. This may consist of things like flyers and online advertising.

The other great form of advertising for home businesses is based heavily on word of mouth. There is something that can make or break a business entity that is established in the home.

The Right Tools for the Job 

Regardless of what the business is there will be a need for some type of tools to get the business running. It may be hardware or software for printing things. It may be a sewing machine or a tool kit. Whatever a person has a need for should be on site at all times with a backup readily available.

So many people will use tools for the business outside of the business environment. They will damage or misuse the tools and not have anything available to work with. People should separate the business tools from the rest of the household items. This cuts down on confusion and helps business owners function much more efficiently.

Select the Workspace 

It is also essential to select a workspace that will allow people to work effectively. Sometimes it will take a quiet room to get work done. At other times it may take a lot of space to work on different project. The business owner that is doing the work needs to make sure that there is enough room to effectively handle the workload.

Connection to the Outside World

When a home business is set up there has to be a way to connect with customers. Some people may have a separate phone line for the business inside of the home. It is more common and less costly to get a smartphone app that generates a free number. Apps like Google Voice allow free texting and calling. It is also important to have an email address. Connecting through social media is also important. Customers should have multiple contact options.

With the increase of identity theft, people are doing all sorts of things to keep their valuables safe, while the choices may vary, it is clear that we must do something about it. One option that seems to be picking up steam is to put your valuables in a safety deposit box, where others can’t see it or steal it. Today we will take a look at the Pros and Cons of Safety Deposit Boxes to establish whether they are for us to use. 

Protected

Pros 

Losing valuable documents can make for a bad day, especially if those documents are difficult to replace, like birth certificates, passports and deeds for your home. In a safety deposit box, the risk of losing them is extremely small. 

Cons 

Although the likelihood of damaged documents is rare, it is a possibility. Just think about what would happen when you experience an earthquake or an explosion. There may be other situations that could destroy your safety net, so at the very least, double your protection with a fire safe. 

Size Does Matter!

Pros

 Another advantage in using a safety deposit box is the fact that in the unfortunate event someone meets their demise, the family will know exactly where to look to find the important papers. Just imagine what would happen if you had to go looking for each and every document.

Cons 

Because of the added security, our natural reaction is to put as many things as possible in the safe, forgetting that there is a limited amount of things that we can store there. 

How safe is a safe?

Pros

There is no doubt that when you think about the Pros and Cons of safety deposit boxes, you have to acknowledge the cost. Although this is going to be another bill to add to your monthly budget, the safety issues are well worth it.

Cons 

The peace of mind that a safety deposit box will give you, because of where it is, should also be evaluated. Remember, safety deposit boxes can be robbed too.

Honey, have you seen my keys?

Pros

 One of the major selling points that comes with the promotion of a safety deposit box is the fact that your valuables are protected. It is a load off your shoulder when you consider the fact that unless your bank gets knocked over, leaving a gaping hole in the wall, your valuable photographs should be safe.

Cons 

Safety deposit boxes require 2 keys, one of which you must hold on to. Imagine what would happen if you ever lost that key.

What do you mean, they are closed?

Pros

When was the last time you tried to plan a trip, but just could not find your passport? With a safety deposit box, you always know where it is and that it will not get lost.

Cons

But what happens if you need your passport on the weekend when banks were closed?

And there you have it, a few things to consider about a safety deposit box to secure your valuables.

There are many benefits for a person spending less than they earn; not only will they have the money they need for paying their bills, they’ll also be able to plan their finances with a clearer mind. The first benefit for a person spending less than they earn is that they’ll be able to see where there money is going, what bills they have, and their financial priorities. When an individual is spending their money only on their bills, they’ll notice that their monthly bills will start to decrease in size, and they won’t be nearly as stressed out at the end of the month.

Furthermore, saving more money will also allow a person to have funds should an emergency ever arise. In an emergency, they will have the funds that they need for things like a car accident, loss of a job, or even home issues that need to be fixed. When saving money only for the necessities and emergencies, they will soon have far less debt. Within time, the only debt that a person might have is their monthly payments.

In order for a person to start saving their money, they’ll first need to analyze what their current expenses are. Things that they might be able to go without could include cable or satellite TV, Internet, a contract cell phone, new clothes or shoes every week, or even video games or electronics.

Additionally, the individual should also make an itemized list of their monthly bills, which can include rent or a mortgage payment, utilities, household expenses, groceries, gas money, medication costs, or other applicable expenses. After the list has been made, the individual may prioritize those expenses in the order of importance. Afterwards, some expenses might need to be cut; this might include entertainment expenses, or downgrading the expense for things like eating out.

Once the expenses have been written down and prioritized, the individual can then focus on cutting down their daily living expense costs. In terms of visiting a fast food place every day for meals, a way to save a lot of money is to simply bring a bagged lunch to work or school. Also, people can opt for instant coffee to bring along to work, or they may also brew coffee at home and fill up a Thermos container.

There are also other daily expenses that can be decreased, or even cut entirely as well. More than likely, the bank that the person uses probably has steep fees for various circumstances. For one, most banks incur hefty fees for being overdraft in an account, as well as returned check fees. To help combat this issue, the only viable option is to switch to a bank with lower rates, or possibly open an account with a local credit union.

Some of the last things that can be done to cut spending is become more energy efficient around the home. In terms of the light bulbs that are being used in the home, standard incandescent bulbs can be switched out for CFL bulbs. Also, the homeowner might opt to install more energy efficient appliances in their home, alongside practicing energy saving tips.

Despite the fact newly emerging entrepreneurs of small businesses think of themselves as exerting independence, at some point they must come to realize that the financial success of their small business is subject to the political environment of their intended operation and that their aspiring efforts for financial success are greatly affected by political decisions. In addition to self-preparedness, business savvy and being equipped with a well developed business plan, pursuing small business dreams of acquiring financial success entails determining whether political decisions will support or end those dreams. Newly engendered small business aims trying to balance the demands of time needed for product branding and establishing a growing customer base, while maintaining adherence to required financial and regulatory compliance, can be overwhelming.

The Political Pull: How Political Decisions Can Affect Your Finances.

Political decisions affect the operational and financial running of small businesses. A 2009 report by the Presidential Council of Economic Advisors stated that the big business industries pay 18% less for insurance policies for an employee than a small business. Unless there are political decisions aimed to correct this difference, the finances of small businesses will likely be more affected by a greater cost for health care and other benefits. Other obstacles facing the financial status of small businesses include: those political decisions controlling interest rate policies that can decrease money value; political decisions affecting economic programs that result in poor sales; political decisions of monetary policies affecting interest rates; political decisions for employee benefit legality and authority requirements contributing to the cost of labor; political decisions affecting the obligations to government regulations regarding certifications, permits and licensing; political decisions favoring the growth of big business competitors; political decisions on education, training support and funding that influence the quality of labor; political decisions on taxes, regulation reforms, rights of property, immigration, social and educational funding and those political decisions affecting the financial practices and decisions of small businesses in hiring employees, their capital spending, increasing inventory and decisions to apply for credit.

The 2010 political decision to allocate to small businesses a 100%, one year, short-term deduction for capital expenses is highly favorable for small businesses interested in reinvesting in their business. This political decision can encourage stimulation of the economy and reduce the ‘revolving door’ effect of perpetual unemployment, as well as strengthen consumer demand. Small businesses need to continue their awareness of political decisions concerning proposals directed to increasing small businesses through invested tax credits, deductions for capital expenses and promotion incentives that could lead to creating increased small businesses. Political decisions based on policies intended for good purposes sometimes fail to meet their objectives.

For instance, if the government decides to increase lending to small businesses but neglects to see demand for loans is down despite sufficient credit allowance but because there is a lack of customers, small businesses are reluctant to apply for the loans. 

There Is More than One Answer to Budget Problems

Too few Americans realize the importance of a budget. They appear to be spending everything they earn each month without understanding that they should be saving for the future as well as enjoying life in the present. The indications are that many are enjoying themselves now but not paying too much attention to tomorrow. That budget is becoming increasingly critical for many in today’s adult population.

Card Debt

One indicator of the state of consumer finance in the USA is that credit card debt is expected to pass $1 trillion before the new President takes office. Average debt per household is bad enough but when you look closer and only consider the card holders who regularly pay interest on balances every month the figure exceeds $15,000. It is unsustainable. Even if a user stopped using their card immediately and paid the minimum required each month it would take well over 20 years to clear the debt. It does not bear thinking about the amount of interest he or she will have paid. So much for the bargain you thought you bought on your credit card!

A recent poll by the National Foundation for Credit Counselling (NFCC) reports that when consumers were asked which of their debts concerned them most credit card debt earned 70%. At least it seems that families do understand the problem.

Credit Score

The best realisticloans.com deals go to those with a good credit score. One of the things that is considered to calculate a credit score is the ratio of debt against available credit. Those reaching their credit limits on their cards will be marked down. It is possible to improve your credit score as old data becomes less important and prompt current payments are entered in your history. It is important that everyone knows their current score and that means regularly asking for the agency reports that you are entitled to and disputing anything that you think is inaccurate. Likewise if you think some positive entries are missing, shout up!

You can ask for an increase in your card credit limit. That will slightly improve your debt/credit availability ratio but then you are more likely to ask for an increase because you want to spend more.

Online Lenders Can Help

However personal loans are available to those with a poor credit score as long as they have a regular income and can justify the amount they are seeking. That means lenders want to see that the repayments are affordable. The new breed of online lenders playing an ever increasing role in the financial sector are there to help. The interest rate applied will be much lower than that charged by card companies so you can immediately take some positive action to tackle debt by taking this one action. You should look at other possible savings in your monthly expenditure with comparative websites a good starting point to see if you are paying too much for your telephone, insurance and utilities.
The expenditure side of your budget is only half the equation. What can you do about the income side because if you can raise that at the same time you may have a real chance to save?

Ways to Improve your Income

Wage growth is lagging behind as the economy improves. Whether you can get a pay raise or change jobs to have more money each month you can look at other income sources.

Some people may decide to take a part time job but commuters will have little time to devote to extra work involving going out again to work in the evening. The answer may be to use the opportunities that the Internet present. While you do not want to be up all night the Internet is 24/7 and if you find a niche it is likely that you can work in hours that suit you.

If you are a good writer and your area of expertise is something that you are able to pass on to a wider audience then you can earn money without compromising your permanent employment. There is always someone willing to listen and read. You may enjoy marketing and therefore can explore whether you can start to trade online. Even if you do not have any personal things to sell you may be able to find an area where you can buy and sell. Not only can it earn you more money it is fun.

Why not investigate other internet opportunities as well? Your budget may begin to look healthy.

Most people may have an idea of how much money they have saved and how much they owe but may not necessarily know what their net worth is. Your net worth is the difference between the value of what you own and what you owe. Assets are items that you own such as cash, real estate and personal property and liabilities are amounts that you owe such as mortgages, loans, credit card bills and student loans.It is important to check your net worth occasionally to have an idea of how you are spending and saving your money. You may have a lot of stuff but how much do you owe on it?

When calculating your net worth it is important to use accurate values. When determining a value of your home take into consideration what homes comparable to yours have recently sold for. You may also want to get an appraisal completed to get a professional and accurate value. With changes in the market, the value may be higher or lower than what you paid for it.

When determining values of personal property items you need to consider depreciation. Most items will not be worth as much as you originally paid for them. If you need to sell items quickly you may only get a fraction of the original price of the items.

If you owe close to the value of the items you own it may be wise to keep an eye on how you are spending your money. Many people spend more money than they think by not considering the small expenses. It may be helpful to track your spending for a week or up to a month to see where your money is going. Keep track of every cent you spend and at the end of the week or month take a look at your spending and see if there are expenses you can cut back on or cut out completely.

A dollar or two here or there may not seem like a lot but can add up over time. The same is true for interest payments. They may not seem like a lot when added to the principal but over a number of months or years they can add a considerable amount to what you are paying.

Many people think they are doing okay if they are able to make the minimum payments but by doing that they are barely paying off the interest charges and not making progress to paying off the principal amount.

Knowing your net worth is an important part of knowing what the condition of your financial life is. To have a positive net worth, you own more than you owe.

If you’re one of those people that intend on relying on social security for their retirement, you shouldn’t. While social security is intended to be used by people when they reach their retirement age, it may not be around for that much longer. In order to properly plan for your retirement years, you should assume that you’ll be paying for it all yourself without depending on social security. Although that may not be desirable for some people, it may be inevitable based on the current data. It’s said that younger workers who have higher-incomes shouldn’t intend on getting the same level of benefits that everyone’s parents and grandparents are receiving. Rates may be even lower by the time the current generation reaches their retirement age, or even maybe completely gone again.

Given the current birth rate in the United States, being at only 13.5 babies being born for every 1,000 people is much lower than it was in the the early 1950′s when the rate of birth was 25 babies for every 1,000 people and 15 babies per 1,000 people in the 1970′s. With the current population living longer and having fewer babies, more people are reaching their retirement age while less people are entering the workforce and paying into social security so there’s more people taking out funds then there is people paying into the fund.

As that continues to happen, the money in the social security fund is going to eventually dry up and there will be nothing left. And according to the data, that’s what’s going to happen. Something obviously needs to change. But therein lies the problem because politicians are afraid to even touch the subject because people who are currently of retirement age most often they’re the ones getting involved in political issues and voting.

One solution to fix the dwindling social security fund would to be to raise the required age to receive benefits, there aren’t many ways the problem can be fixed. That would mean people working to their eighties before seeing social security benefits. If that’s the case, people should be planning to fund their own retirement instead depending solely on social security. The sooner the better. And that is Why You Shouldn’t Depend on Social Security Anymore, even if the problem does get resolved with a new solution; Saving your own funds into a retirement account is still beneficial because you’ll have more money by the time you hit your retired years and be more financially stable as opposed to just living on social security means.

So, regardless of whether you’re 22 or 45, the sooner you start saving, the better, because that’ll mean the more you have just in case social security runs out and there’s nothing left. Start a 401K with your employer or sign up for a Roth IRA yourself so money is automatically deducted from your checking account and saved for you. It’s a small step towards helping your future in a major way.

It is not easy to run a small business. People who run a small business don’t have a lot of money to spare, and they try to keep wasteful expenditure to a minimum. Even after all the efforts, there are always some areas where money can be saved. For a small business, every penny counts. The following are a few areas where money can be saved in a small business.

• Energy Saving Fixtures – Most small business office places get incandescent bulbs installed in the building to save initial money on expenditure. However, these bulbs cost a lot in the long run because they escalate electricity bills and also lead to wastage of energy. Instead, offices should get energy saving bulbs and lights, which would last 10 times longer and would also lower the electricity and energy bills.

• Leasing Equipment – Instead of outright purchase of equipment, leasing should be preferred. By leasing, the entire cost of the equipment can be spread over the years and a proper comparative analysis with buying should be performed. Usually, leasing seems to cost more when calculated without taking time value of money into account. However, it reduces the risk of the small business and saves the hassles of an outright purchase.

The small business owner does not have to worry about repairs to the equipment since the leasing company would take care of that. Also, they would be saved from loans as annual lease payments could be easily financed as compared to loan installments. It is prudent to choose between getting a loan and going for leasing using financial analysis techniques.

• Used Or Refurbished Furniture and Equipment – Second hand furniture and equipment is easily available as there are many business organizations going out of business. These business units sell their furniture and equipment at a really low price and an eye should be kept out for such deals. It is important that the technician does a proper analysis of the refurbished or second hand items before a purchase is made. This is especially true for equipment because no one wants to end up paying anything for equipment that would not work.

• Negotiation – Negotiation is always a great tool on which a lot of money can be saved. It should be used prudently with lenders. The best way to do this is to always ask for quotations from various suppliers and vendors and use the figures during negotiations. The vendor or supplier offering the best price should be chosen. Prices can also be discussed if a choice vendor is not lowering their prices as it could act as a motivator for a better price.

• Free Services or Service Barter – Many small scale business units barter their services with each other to save money. It can be a nice tool to save money and improve business relations as well.

It should always be remembered that money cannot be saved by sacrificing the quality of services and that should be an important consideration when money saving tips are used by small businesses.