Is it Really Worth Investing Small Amounts of Money?

Most of us realize it is smart to invest money. However, some people believe that unless they can invest large amounts of money it isn’t worth bothering in the first place.

So, is this true? Should you forget all about investing anything unless you happen to have lots of cash you can sink into an investment of some kind?

Lots of small equals big

Okay so that isn’t a great sentence. But it does illustrate how important it is to understand there is still power in saving small amounts of money. All those small amounts eventually add up to a somewhat larger one, and when that happens you might find you are left with a lot more cash than you had before.

You can also take advantage of forming a good money saving habit. Even if you can only save a dollar in a jar every few days, you’re forming a good habit that will stay with you for a long time to come. Not only will this lead you to save lots of smaller amounts, it also means you’ll make good decisions if you ever find yourself with a larger sum of money to invest.

The power of compound interest

You’ve probably heard of this before but it is worth looking into in more detail. When you save money you get interest paid on it. It doesn’t matter what the specific interest rate is in terms of this example – all that matters is that you get that money.

Over time you’ll get interest paid on all the money you manage to put away. However, you will also get interest paid on the interest you’ve received over time.

This means you could put away $100 and get, say, $2 interest on it in a year. If everything stays the same for year two, you will get interest paid on $102 in the second year. This will be the original $100 plus the interest from the previous year. If you put in more cash you’ll get interest paid on that as well. The following year you’ll again benefit from compound interest on whatever you had the previous year.

As you can see, it really is worth investing small amounts of money, even if you’re only using a basic savings account. It’s not just the benefit of saving the cash that you’re getting – you’re getting more cash saved up through compound interest plus the perk of a good healthy habit as well. These aspects are perhaps worth even more than putting away the money in the first place, and you’ll definitely benefit from them in the long term.

So if you thought it wasn’t worth putting anything away, you should think again. Your life might change for the better if you focus on the action rather than the amount you are saving. In the end, the total sum saved might surprise you anyway, so try it today and get a good habit going.

3 Things to Remember if You Want to Invest in an Online Business

Every day sees many new online businesses cropping up all over the internet. It’s probably true to say many of them will disappear in time, just as many other businesses do. Only a very small percentage of them will stand the test of time and fewer still will achieve a heady level of success.

However, this shouldn’t put you off investing in such a business. There are two ways to do this – you can set up your own business and sink money into that, or you can invest in someone else’s business. For the purposes of this article we’re going to focus on the idea of investing in a business someone else has or is going to set up.

With that in mind, here are the 3 things you need to remember if you want to go down this route.

1: remember the risks

As is the case with any investment, you need to remember there are risks. You have the choice to invest in a business that is just starting up or to invest in one that is already established. The second option is slightly safer since you will already have a small track record to look at. If you invest in a true start up you will have to rely on the information provided by the creators.

In either case, remember you are investing your money in something that could fail. Are you ready for this?

2: look at the different options

Crowdsourcing is one of the more modern ways of investing money in a new business or venture. Fortunately you can find lots of information about this online without too much bother. You could also look into shares and also the idea of private funding. It all depends on whether you know of any opportunities you could find out about directly.

3: know how much you are prepared to invest

There is always the potential to make a lot of money back on your investment. Similarly, there is the potential to lose a lot of money. Hence you must know what you are prepared to lose, in case the worst happens. Sometimes you may lose a certain degree of your investment but not the entire amount. At other times you may choose the right business to invest in and see a good return on your money. You never know for sure – and this is the fact you must be prepared for.

As you can see, it becomes easier to know what to expect when you are realistic about the idea of investing in an online business. Yes it can be a risky proposition, but it can bring good rewards as well. The trick is to do some research and to work out what you are prepared to risk in order to get the rewards.

If you can do this and get it right, you will end up (hopefully) with a good investment result instead of a failure.

3 Things You Absolutely Must Do if an Investment Fails

However good you are at picking investments, you will have one that fails every now and then. It is impossible to go through life picking all the right investments and never tripping up. If you could do that, you’d make a fortune making recommendations for everyone else!

If you’re relatively new to investing, it makes sense to be realistic in what you can achieve. To this end, here are three things you should do if you trip up with an investment and end up losing money.

1: don’t panic
Yes, it might be the first thing you think of doing, but it’s worth hanging fire before you do. Firstly, as we’ve touched on above, it pays to be realistic. However many investments you have, it’s logical one or two of them won’t turn out the way you’d hoped. This is part of the reason why we don’t put all our eggs into the one proverbial basket.

Take a fresh look at the situation once you’ve calmed down – it may not be as bad as you think. You might be able to minimize the damage or at least decide whether to exit the investment or whether to wait it out to see if it improves.

2: look at why it has failed
If your investment really has turned up its toes and died on you, find out why. In terms of stocks and shares, it could be you’ve bought and/or sold at the wrong time. The only way your failed investment will be a total failure is if you don’t learn from it to prevent the same thing happening again in the future.

For example, let’s say you have lost $1,000 on some shares. By looking at them more closely, you can see you sold at the wrong time. If you had paid attention to the latest news reports and guidance and hung onto them for another week, you’d have minimized your losses, even if you hadn’t made a profit.

3: consider the implications for the future
This really follows on from the point I made above. Let’s look at the failed shares example again. You have two thoughts to consider here. Will you chalk it up to experience and not worry about buying shares again, or will you learn from the experience and use that knowledge to assist you in future purchases?

The decision is yours of course, and it is a very personal one. Some people will be put off by the experience, whereas others will resolve to do better next time so they can choose more appropriate investments with more knowledge.

Whatever path you decide to travel down, you can see how following these three steps will be useful in every case. The more you know and understand about your investments and your approach to them, the easier it will be to minimize the failures you have. These three steps could even make it easier to achieve bigger and better successes in the future.

Diversifying Your Home’s Investments the Right Way

Diversifying your assets is one of the smartest decisions someone could make when it comes to reducing risk in their investments.  In terms of your home, this essentially means that should the market take a turn somewhere down the road, you’ll have made enough investments into your house in various areas that you won’t be entirely affected by what’s happened.  It gives you much more freedom later when it comes to your money.

Those homeowners who take up residence in Texas will be able to peruse an interesting website that collects information on all of their local electricity providers and find a wealth of helpful knowledge about what people can do to help increase the value of their homes.  They have compiled great lists of the different upgrades and daily routines one can take to help grow their house from just a living space to a much better investment.

One of the biggest investments homeowners can put into their homes is taking the time to reevaluate and replace their front doors.  This is the first thing people will notice about the house, outside of the yard area, and it’s an extremely easy way to get interest as many people have the tendency to judge a book by its cover when it comes to browsing homes.  A stable and good looking entrance into your home can give you a return of as much as eight-five percent on this particular investment.

Windows are one of the most expensive upgrades that can be made when investing in your home, but it’s also one of the most important if you’re really looking to get a good recovery from the money you’re putting into your house.  For most households, much of the heat or air conditioning goes quite literally straight out the window all year round, making them one of the biggest absorbers of energy and utilities.  Quick fixes such as caulking or those store-bought draft mats can help this a little bit, but if you really want to put your money in the right place, you’ll need to upgrade those panes. If you’re lucky enough to live in Florida, there are numerous credits and incentives in place you can take advantage of in upgrading your windows.

There are tons of windows on the market now, both premade as well as completely customizable and homeowners can find anything between energy efficient models to those that help keep out the sunlight for the most part.  Figure out what it is you’re looking to do (cut down utilities, keep down the sun’s glare, allow better airflow, etc), and replace them accordingly.

Homeowners should keep in mind that the current real estate experts are saying that natural lighting is one of the biggest assets a home can have in the current market.  More than ever consumers are obsessed with large windows that allow in tons of light and give houses a nice organic feeling, particularly if there is a nice backyard or garden to be seen.  These types of windows will bring the biggest return later down the road.

For many people, their homes are their biggest investments so it only makes sense to do what they can to keep their assets as profitable as possible, which includes diversifying where they put their money.  There are quite a few ways that homeowners can invest further into their homes and still be able to get most of that money back, especially if they research the market.


Editions TV Show Looks at 4 Reasons to Buy a Second Home

Right now, the real estate market is considered a buyers market.  Over the last few years, home prices have fallen dramatically in most major markets, and interest rates on home loans are the lowest on record.  Both of these reasons makes it a really good time to buy real estate. You can find amazing country houses for sale.  However, what if you already own a home?  Should you buy a second home?

Editions TV with Terry Bradshaw looks at some major reasons why now is the time to consider buying a second home.  For many people, they go to the same few places all the time on vacation, and this can be a great reason to buy a second home.  But what other factors are there to consider?  What should you know?  Here are some of the key things to think about when considering buying a second home.

The Financial Implications

The first thing to consider about getting a second home is the financial implications of it.  As mentioned earlier, right now, home prices and interest rates are both very low.  This can make it financially easier to buy a home than it would have been in the past.   However, as Editions TV show points out, it can be incredibly difficult to get a loan right now.

Lenders are being very strict with who they lend to.  In order to get a loan on a primary residence, not even a second home, borrowers have to have impeccable credit, with very high credit scores.  As such, you may have to put much more down on a second home, or even pay all cash.  However, since prices are low, this can be a good investment.

 Editions TV on Family

Family is important to most people.  And having a comfortable place for everyone in the family to get together at is very important.  Having a second home can also be a second home for the entire family.  This can be a place where birthdays and reunions happen, or even fun family events like Thanksgiving or Christmas.  When you have a second home, it is more than just a place, it can be a meeting place for the whole family, who can hopefully enjoy it for years to come.

A Home Away From Home

Plus, having a second home can be a home away from home for you.  Instead of staying in a hotel, staying in a second home should be much more comfortable.  With a second home, you can decorate it exactly how you would want to.  You can furnish it with your belongings, and put up your family pictures.  That way, when you stay at your second home, it is just like being at your primary house.  That really makes it a much more comfortable place to stay than just any lodge or rental house.

Plus, when you have your own home, you can cook and have all the amenities that you’re used to having.  This can make it much more comfortable than a hotel room or something similar, and can be great if you plan on having family over.

Making It A Smart Investment

Finally, Editions TV with Terry Bradshaw believes that you can make getting a second home a smart investment.  First, if you travel a lot, look at how much you spend on hotels and lodging for the year.  Then, look at what the cost of a second home would be?  If they are close, why not invest in a second home that would probably provide you with more amenities that you would normally get while you’re traveling.

Second, a second home can be a good source of income when you’re not using it.  If you are thinking about getting a second home in a tourist area, you can leverage that home to be a vacation rental when you’re not using it.  There are many vacation rental firms out there, and they can handle the logistics of it while you just enjoy getting a paycheck when you’re not there.  And when you want to stay there?  You just let them know.

A Comparison Between Lending Club and Prosper: Peer to Peer Lending

If you’ve been reading our blog in recent weeks you’ll know we’ve covered peer to peer lending and two services in particular: Lending Club and Prosper. This week we’re going to focus in on comparing the two, to enable you to get a better understanding of how they fare against each other.

What amount of loans has been met so far?

At the time of writing, Lending Club had filled $960,287,975 in loans since it had first got underway. Prosper has managed under half of this at $411,000,000. Prosper opened its doors in 2006, while Lending Club began life a year later.

Are the loans rated to provide different rates of interest at each club?

Yes – you’ll notice different grades of returns at each service, going from A upwards. This enables you to gauge what degree of risk you are happy with and to balance your investments in each case too, so you can spread the risk.

What is the maximum amount you can borrow if you are looking for a loan?

Prosper will lend a maximum of $25,000, with a minimum of $2,000 in place. Lending Club will lend up to $35,000 and there is no obvious minimum given.

Are you guaranteed acceptance for your loan?

No – Prosper indicates it will accept creditworthy borrowers, whereas Lending Club specifies that it approves less than 10% of the people who make a loan application.

How do you invest? Is the process similar for each one?

Yes – you invest in notes. Each note with each company is represents a $25 investment. You can choose how many notes you want to invest, although a larger amount is more likely to give you a good rate of interest, because you can spread your risk across more than just a handful of investments.

Do you get a good degree of control over your investments?

Yes you do, because in each case you can decide whether you want safer A graded investments or riskier higher graded investments. Most people balance out the risk and thus improve their chances of getting better returns while spreading the risk.

How do you decide which peer to peer lending organization to go to?

There is no simple answer to this. One person might prefer Lending Club while another might be happy with Prosper. The best course of action is to go through all the options and to read the information on each website. Compare what each organization is giving you (either as a borrower or an investor) and see which one seems best for your needs.

One thing is clear though: both Prosper and Lending Club have established themselves as leading players in the peer to peer lending market. If you like the idea of this new model of investing and borrowing, it might prove worthwhile to look into it further. Plenty of people have already had experience of peer to peer lending from one side or another: you could be next.

Lending Club: Peer to Peer Lending in the US

A form of lending that has become more prevalent in recent times is peer to peer lending. As the name suggests, it focuses on the idea of people lending to each other and to businesses, rather than using the banking system to facilitate such loans.

One leading company providing such a service is Lending Club. The club opened its doors in 2007 and has been going strong ever since. The whole process works over the internet, so providing you have access to their website you can find out more about them and open an account or apply for the loan you need.

Information for those who want to borrow

If you cannot get a loan via your bank it may be worth considering Lending Club. According to their website you can borrow as much as $35,000 from them. The application process is handled online and you pay the money back in monthly payments in much the same way as you would with other loans.

One of the advantages of looking to Lending Club for your loan requirements is the ease and simplicity of getting the quotation you need. They provide rate comparisons with other services as well, so while you should compare rates independently they do seem to offer a competitive service.

Information for those who want to invest

This is perhaps the most interesting part of Lending Club. The principle works according to Prime Consumer Notes. Each ‘note’ is an investment and while you can choose how many you want to hold, many people opt for hundreds at a minimum. Some elect to invest in thousands.

Lending Club grades the notes according to the risk that fits with them. Grade A notes are the safest and provide a lower rate of interest. Grade G is the riskiest note and therefore provides a much higher rate of interest, around three times as much as the safest note.

It is up to you how much risk you wish to take, although they suggest you opt for a mixed selection to spread the degree of risk you are taking.

Is Lending Club for you?

Clearly it is worth taking a closer look at Lending Club if you are considering either an investment or a loan of some kind. The opportunity to balance the amount of risk you are taking will appeal to those who want to exert more control over their investments. Furthermore those who wish to apply for a loan without having to jump through the hoops provided by the normal banking system may find what they need here.

Of course Lending Club won’t suit everyone, whatever side of the fence you happen to be on. However it may well prove to be a viable alternative for many people, and one that fits with personal goals and desires. With more than $900 million worth of loans funded so far, Lending Club has established itself as a key player in the industry.

Are You a Knowledgeable Investor?

How much do you know about investing? Many people stick with what they know, rather than trying to expand their knowledge in any way. For instance they might stick with plain savings accounts instead of looking into the potential returns offered by investments in the stock market. They will limit their outlook depending on what they already know, instead of trying to learn more about the potential opportunities available to them.

The question here is obvious – how knowledgeable are you and do you make any effort to expand the knowledge you already have? It’s a bit like going to your local bakery and assuming it bakes the best rolls in town, simply because you don’t have anything else to compare it to. If you started looking a little further afield you might discover a bakery two streets away that bakes the most amazing rolls – far better than your local bakery produces. Wouldn’t you start going there instead to get a better return for your efforts?

It’s all about expanding your field of vision. If you don’t see stocks and shares, you won’t consider investing in them. The same holds true of tax free options and any other investment you may care to think about.

The good news is you don’t automatically have to opt for a new investment you find out about as a result of your exploration. However it will enable you to learn more and take a more educated approach to your investments. You may be missing out on the best investment for your needs, simply because you don’t even know it is there.

You might feel put off by the word ‘educated’. This makes it sound as if the process of learning more about investments is going to be dull and boring, like taking lessons at school. But it doesn’t have to be this way. You can learn as much or as little as you like. If you don’t have any interest in penny stocks, don’t learn about them. If you find you like the idea of investing in long term bonds, start exploring the nature of these bonds so you know what to expect. You’ll soon see you can drift towards those areas of investing that appeal to you, and which might turn out to be profitable for you to sink some money into.

Being a knowledgeable investor isn’t about learning everything there is to know about investing. It’s about letting your interests take you in specific directions. It’s about learning how you can best invest whatever funds you have available in the right areas for you. It’s about developing your own knowledge in the directions that make sense to you. It’s not about following in the footsteps of others or doing certain things because you think that’s what you should do.

So if you feel like you want to develop your investment knowledge, let your own ideas and thoughts lead the way. You might be surprised as to where they take you.

Logical Tricks to Find More Money to Save and Invest

You can read and talk about investing all you like. But if you don’t have money to invest your talk will get you nowhere.

You may look at your income and expenses and think that you couldn’t find any money to invest at the present time. You need to get out of this mindset if you are going to push towards putting some successful investments in place for the future – whether it is for the short, medium or long term.

So with this in mind, here are some tricks for doing just that.

1: reduce your bills

Some bills are fixed. But others can be reduced. Shop around for a new mobile phone deal that suits your needs and costs less than the one you have now or switch to a hosted PBX system for your business to save even more money. Repeat the process with all the other bills that can be adjusted in a similar way.

2: earn more money

Can you find another part time job to earn a little extra? This depends on your circumstances and the jobs that are available that you can do, of course, but it is worth thinking about. You could also consider moving up in the industry you are already in. Look for another position that would allow you to earn more money.

3: sell off anything you no longer want or need

This is another good way of generating extra cash that can be funneled into investments of all kinds. It is said that we all have a few thousand dollars worth of items we don’t use or need. If you could find those items and sell them – maybe on eBay for example – you might be surprised how much cash you can generate as a result. Go through each room at a time if you feel overwhelmed doing your whole house and life in one go.

4: look for an investment that pays more interest than one you have at the moment

Even if it is a regular savings account, you’ll probably find a better deal somewhere else if you have held the account for a while. Always check regularly to see if you can find anything better with another bank or provider. You could be losing money on existing savings or investments without even realizing it.


As you can see it doesn’t matter what situation you are in, you can always find a way to generate and create extra cash to invest in some way. Make sure you go through all the above techniques. You may be able to use all of them to some extent. If you find, say, $20 from one technique and $40 from another one, you’ll have more cash all told than if you just used one technique.

It will take time to make the most of these techniques but the outcome should be more than worth it. This is especially true when you have investments to create for the future – you never know what you can achieve when you try.

Is it Too Late to Make Any Smart Investments for Your Future?

It’s often said that if you want to invest in a pension plan for your old age, you need to get one up and running as quickly as you possibly can. This means you have more years to save the amount you’ll need to get the results you want when you’re older.

But does this apply to all investments? For the most part it does. Take stocks and shares for example. We’ve seen many shares take a tumble in value over the past few months and years, owing to the recession most of the world has been experiencing. But if you were to look at the performance of shares in general over a much longer time period, you’d see they were actually performing quite well in the long run.

Time really is in your favor in many cases. So what does that mean if you are in, say, your forties and you’re thinking of making some investments for your retirement? You’d have been better off making those same plans in your twenties, sure, but does that mean there is no point making them now?

Planning for the future

The main thing to remember here is that you must make the most of the time you have left before the target for your investments arrives. So if you are saving for your retirement and you are currently in your forties, you still have a good few years before you actually retire.

However if you delay your plans because you are worried about whether you have enough time to save for them, you will automatically give yourself a lot less time to save. You should know the difference between delaying because you are gathering information about various options and delaying because you are hesitant about whether it is worth it or not.

To be truthful any amount of time you have to make investments in is worth using. The trick is to find the right investment for the amount of time you have available. Some are naturally time limited so you have to find a vehicle you can use that will get you the best return without posing too much of a risk to your cash. We all have different levels of acceptance when it comes to risk of course, so it makes sense to consider where you sit on that subject.

Another option to consider is whether to spread your money around. This can help to negate the risk of any one single investment you are considering putting your money into. But some investments will spread the risk for you, meaning that one vehicle can put your money into several places.

Clearly you have a lot to think about here. However old you are or whatever goals you have in mind, it is never too late to make an investment choice. The nature of the investment you make could differ depending on your age, but there are always opportunities to consider.

What Should You Do When an Investment Dives in Value?

When you look for investments that stand a chance of paying back more than just a meager rate of interest, you will automatically put your cash at a higher level of risk. For example if you buy into stocks and shares you may end up seeing your investment appreciate considerably – or it may take a nosedive, leaving you with less than you had originally invested.

Some investments are designed to run for specific lengths of time, while others give you more freedom over when you can withdraw your money. If your investment happens to be losing money now, what should you do?

Number one – don’t panic

We’ve seen many instances in the past where people have immediately withdrawn all their money – the classic ‘take your cash and run’ reaction. In many cases the people who hung on and sat back to see what happened found their investments returned to near normal soon afterwards. Those who cashed in early lost money, while those who waited didn’t.

Of course this is not guaranteed to happen. But it is definitely worth finding out more about the situation and the likely outcome before you decide what else to do.

Research how the situation could play out

The most important thing to do is not to rely on one single source of information concerning your investment. Before opting to withdraw your cash, make sure you find out the potential consequences of doing so. Remember that reading any news reports concerning the state of any investment are likely to be overly dramatic in many cases. Find out the real truth and base your decision on that.

Consider how long you were going to hold the investment for in the first place

It has long been the case that when it comes to stocks and shares, it is the overall performance that matters. Even in the case of a recession, when the value of shares can drop remarkably, the share value can eventually bounce back again.

If you were intending to cash in your shares or other investments anyway then it may be prudent to cut your losses now before things worsen. But if you were holding onto them for the long haul it may be better to hang onto them even through tougher times.

Remember there is no single solution for all circumstances

It is wise to remember that there is no ‘one size fits all’ solution to handling a weakening investment. You must consider a range of options before deciding which one would be best for you. But the most important thing to remember is never to react to the event without first looking at it from every angle. This will help you to determine whether you are better off cashing in your investment now, or waiting things out to see if or when they may improve.

There is always an element of risk in whatever decision you make. But in reality you could fare better by acting rather than reacting.