Tag Archives: Many People

Living with Cash: Would You Spend Less?

Every now and then you read a report or story that suggests one day we’ll live in a cashless society. However many people would argue that it’s easier to spend less money when you live with cash instead of using credit or debit cards. When you hand over real money instead of a piece of plastic, you can see just what something is costing you. In fact, if you’re considering cutting back on your spending, adapting to cash could be the best way to do it.

Budgeting for cash

For this to work you have to have a budget in place to start with. This will tell you how much cash you have available once you’ve paid all your bills each month.

Of course it makes sense to go through all your bills first anyway, to see whether you can reduce them to save even more money. Once you’ve done this you can work out a weekly budget to stick to. At the beginning of each week you can take that amount out of your account in cash. That’s the money you’ve got to live on each week. It should cover your grocery bill as well as anything else you want to buy.

Managing with cash

It’s a lot harder to spend money with cash than it is to use plastic. That’s the reasoning behind this method. If you’re in any doubt that it works, try it for a couple of weeks and see what happens. You might be surprised at the results. If you go grocery shopping you will pay in cash. What will $50 of groceries look like? How about getting all those special offers and spending $100?

Similarly if you go shopping and you see a top or a shirt you’d like to buy for $25, you have to hand over the cash. There’s no facility to buy now and worry about it later. That’s what sets this experiment apart from buying with plastic. You get to see how much something is costing you – in cash, here and now. As you’ll see, it gets much harder to spend money when you see the money going in front of your eyes.

The truth is that unless you are disciplined you will find it difficult to stick to a budget if you rely on credit and debit cards on a daily basis. Cash makes it much easier to keep track of your spending. You have a weekly budget in cash in your pocket, so you can see how much you have left simply by taking it out and counting it. When you have the cash right in front of you it’s impossible to lie about it or spend more than you can afford.

If you are struggling to stick to a budget or you simply want to save money each money and waste less money, try the cash route today. In reality, cash will only cease to exist if we let it.

Could You Invest More Cash if You Were Self Employed?

It’s an interesting question isn’t it? Plenty of Americans are employed with businesses of all sizes, but in recent years there have been an increasing number of self employed people carving out their own businesses as well. This is partly due to the economic crisis, as more and more people have been made redundant. Armed with a redundancy package (if they’re lucky) and no prospect of an employed position in sight, many people are looking to create their own opportunities instead.

The picture of self employment is often painted as a challenging one. You’ve no guarantee where the next job is coming from and you might end up with a very uncertain cash flow. However, many self employed people are doing well, and when you compare this to the uncertainty of being employed, you can see there may not be such a big gulf between the two after all.

All of which brings us to the question posed in the title: could you invest more cash if you were self employed as opposed to employed? Would it really be possible to do this?

Every situation is different

No two people are ever the same, whether they are self employed or not. An employed person on a low wage might save more than a self employed person on a high income, simply because they have better savings habits. But let’s consider a level playing field here for a moment in terms of income and the working situation you might be in.

Let’s suppose there are two people each earning $40,000 a year. One is employed and the other is self employed. By the nature of self employment, this person is able to earn money from a number of sources (clients). The employed person relies on their company to pay them their wage. If the employer lets them go, they’re out of a job and have no more cash coming in.

In contrast, if the self employed person loses a client, they still have other clients to fall back on. Their income might dip, but they can go out and look for other clients to make up the shortfall. Indeed, they can also look for new clients to earn still more money.

Which is best?

This is where the difference becomes clear and you see why there is a greater chance of saving more if you are self employed. Clearly the real difference comes when discipline and good savings habits come into the fray. However, there is more potential here to earn more money as a self employed person. Since you are in control, you can create all manner of schemes and ideas to bring in more money and more benefits to you and your business.

Of course not everyone is cut out for self employment. Whatever position you are in and however promising your future looks, make sure you set good financial habits in motion now. They will help you achieve the level of savings you want to have in the future.

Should You Invest in Your Own Online Business?

The internet has changed our lives in an incredible number of ways. Perhaps most notably, it has given many people the opportunity to set up businesses from home. New business opportunities have been created that many people can have a go at.

However, does this mean you should invest in a business of your own on the internet?

If you are thinking of doing just this, with the hope of generating a new line of income in the process, here are some points you should be aware of.

1: you can start with very little money

This is good to know if you are on a tight budget. There are enough free services online to make it possible for people to get started making a small amount of money without investing anything up front.

There are also other opportunities for you to make money while investing just a small amount upfront. For example, you can easily set up your own website by purchasing a domain name and hosting for just a few dollars a year. Most people could afford this and create a blog that recommended products from free to join affiliate programs. This alone has the potential to generate anything from a few to a significant number of dollars per year.

2: you can build a business in your spare time

This is one of the main points that attract people to earning money online. Regardless of what job(s) you do now, you can find spare time in which to build a business of your own. Plenty of other people have done so before you – could you be next?

3: there are plenty of scams out there – make sure you’re not a victim of one of them

Never part with any cash to get a job opportunity; you’re often better off setting off on your own path. By all means research different opportunities and find reviews of what other people think. But make sure you don’t fall for any smooth selling.

4: it really is possible to build your own business

Who knows, you might even earn more from doing so than you’d ever earn working for someone else. You do need to work for it though – don’t assume it will come easily or without making any mistakes.

Since there are several opportunities you can go for online, you might also want to consider which one will suit you best. The worst mistake you can make is to do something simply because someone else is doing it and achieving success with it. It doesn’t automatically mean you’ll be successful too. The trick is to find your passion – that’s what will earn you the money you need to succeed.

In the end, there are ways to invest in your own business on the internet. But you need to be diligent and do your research to find the best opportunity around for you today. Make sure you make the most of your opportunities and seize the moment to make your business work.

Understanding the Concept of Emergency Cash

Many people are focused on the idea of saving for the future, investing in various stocks, shares and accounts and preparing for what the future may hold. However some people completely forget to account for emergency cash in this picture – cash you’d need to lay your hands on in a hurry if the situation ever arose.

What is emergency cash?

Generally speaking, this is the cash that would pay your rent or mortgage. It’s also the cash that would pay your bills and keep you afloat for three months if you suddenly found yourself with zero money coming in. This might sound like a worst case scenario and it is, but it’s the reason why you have to generate an emergency cash fund in case you ever need it.

How would you cope if you lost your job?

This is normally why you’d find yourself with zero income. It’s easy to think you’re in a safe position at work, but plenty of people lose their jobs every month and never see it coming. It’s also the case that plenty of people have made no provision for this type of event – an event that has become more common owing to the worldwide recession.

If you already have an emergency fund, congratulations are in order. You know you have enough cash set aside to pay the bills for a three month period. This means you’ve got three months to find alternative sources of income so you are safe from real financial worries. It’ll still be a worrying time of course, but it won’t be as bad as it might be otherwise.

Resolve to set up an emergency fund today

If you don’t yet have the cash you need, today is the day to start amassing it. There are two main criteria an emergency fund has to meet:

* It has to be in an instant access account
* It has to cover three months’ worth of outgoings

Figure out how much cash you can save into your fund every week or month and build it up as steadily as you can until you hit your target amount. For example, if you need $1500 a month to meet all your bills, you will need $4500 in your fund. If you can save $250 a month towards this target, it’ll take 18 months to hit your target. Even if something happens in the meantime, you’ll have more cash set aside for emergencies than you’d have had otherwise.

Some people dip into their emergency funds for other reasons too. For example they suddenly find they need a new refrigerator and they need to pay for it quickly. In this case they’ll use the money they need to solve the emergency, and then work to replace it as quickly as possible out of their earnings until they achieve their emergency balance again.

As you can see, it is incredibly important to make sure you are prepared for the worst. At least then if it does happen, you are in a position financially to cope with it.

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.

 

The Importance of Planning and Saving for the Future

Most of us realize we should put some regular effort into saving money for our futures. However in reality we don’t all manage to do it. One report just released by HSBC says people in the US have only managed to save for around two thirds of their retirement years (on average). Of course none of us knows how long we will have to enjoy retirement, but according to the study the average length of time we have finances to cover is 14 years. The study also found the average retirement stretches out for 21 years.

The figure does not become any more promising if we take a look around the globe. Other countries find themselves in a similar position, with far less in savings on average than the number of years people have left to live.

How can you make sure you don’t become one of these statistics?

There is a lot to be said for living for the moment. But we also have to look ahead and ensure we can live comfortably in the future too. After all we spend so much of our lives working: it seems a shame not to enjoy our retirement and have a reasonable amount of money to see us through this period of time.

So it is a delicate balance we must strike: to spend money today and also to save for the future. If we can make sure we are able to do both, we should avoid becoming one of the statistics mentioned above.

How can we plan for the future?

The real task is to ensure we live properly today while freeing up some cash to invest in our futures. The current period of time is challenging for many people, with wages stagnant and many goods and services shooting up in price. This means many people are struggling to save anything at all. Many do not even have the luxury of a financial cushion to rely on in case anything should happen.

So you can see the task is to take a serious look at your finances now to see where you could possibly make savings. Many people can free up some cash in one way or another, depending on their situation. Even if it means giving up one or two so called luxuries, wouldn’t you rather have something to invest in your future? After all once your retirement arrives you will have no more time to build a nest egg to survive on.

They say the longest journey starts with one small step. This is true, and so is the need to focus on your desire to plan for the future. Even if you only start in the smallest of ways, you will be heading in the right direction. And once you get started you may gather pace and find new ways to save for your retirement.

The figures do not lie, and if you want to be able to fund your retirement the best time to start is now.

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.

How Did the Commodities Market Begin?

If you are considering making an investment in the commodities market it makes sense to find out as much as you can about it first. This can lead you to make a better investment than you would otherwise. In addition to this there is the opportunity to learn how the market began – and it might actually go back a lot further than you think.

Before the days of money

While we are used to using coins and banknotes by way of making payment nowadays, there was a time when money didn’t exist. Ancient times saw people using commodities to make deals with each other. Sometimes a token would be made in clay that would feature the number of animals a person would agree to trade with another. While this is far removed from the way the commodities markets are run today, the principle is very much the same. Many people would be surprised to see how many hundreds of years’ back the history goes.

The modern commodities market

Of course the commodities market in the present day is a totally different thing. Nowadays it must be properly regulated to ensure the deals are fair for everyone. Indeed this was one of the reasons why the first proper commodities market was created in 1849.

You may recognize the name of this market, since it is the Chicago Board of Trade. This was not only the first market of its kind it is also one of the most successful of its kind today. Nowadays it is part of the CME Group, which is comprised of the Chicago Board of Trade and the Chicago Mercantile Exchange.

How the commodities market has changed over the years

There is no doubt the creation of the Chicago Board of Trade in 1949 made a big difference to things. More regulations have been put in place since that time to make sure the market is protected and that trades can only be made in a certain way.

Typical examples include The Commodities Exchange Act, which came into being in 1936, and the Futures Trading Act, which came into force several decades later in 1982. The good news is that all these acts and rules mean it is easier to know what to expect when you delve into the commodities market.

In a similar fashion we can no doubt expect this marketplace to change even more in the future. Nothing ever stays the same for too long in this sense, and this goes for commodities too. We will always need commodities and lots of people like to invest in them because they can provide a more consistent profit than you might get in regular stocks and shares.

But regardless of whether you decide to invest in them or not, you will see how fascinating it is to look back into history and explore what commodities meant in the past. Things may have changed in many ways, but the principle is still there.

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.

What Kinds of Mutual Funds Can You Get?

Many people have heard of mutual funds. But even though they are often talked about as if they are all alike, nothing could be further from the truth. Mutual funds can be classified in all kinds of different ways, although there are several main kinds that can be noted to exist if you are a beginner. Here we will go through these types so you can delve into each of them in more detail.

Stock funds

If you are considering getting involved with stock funds you must remember they are better focused on for the long term. It would be unwise to assume you could get a good return over the course of a few months. We are all aware of stock market crashes that have occurred in the past. However, even with these crashes in mind, the overall trend for the value of stocks has still been on the rise.

One other point to remember is that this category of mutual funds is generally best if you are happy to take on a little more risk in the hope of gaining a bigger reward.

Bond funds

Those who feel more secure knowing they have a more reliable source of income will likely feel more confident investing in bond funds. Of course they come with risks, much like any other mutual fund, but they are greatly reduced when compared to the other types. One of the key risks is a potential rise in interest rates. This has the effect of reducing the value of the bonds, thus making them less successful.

Balanced funds

As the name would suggest, these are normally a balanced mix of both stocks and bonds. This might be suitable for you if you want to invest in both types but you want to keep them together in one mutual fund. Obviously it makes sense to identify exactly which types of stocks and bonds go to make up any specific mutual fund before you invest. And remember, there will be a degree of risk involved so bear this in mind as well.

Money market funds

This type of mutual fund traditionally carries a far lower risk of loss than the kinds of funds mentioned above. However this is tempered by the fact that the returns are usually lower than the others as well. It is the classic case of less risk, less reward. The other kinds of mutual funds offer a higher degree of risk, but if that risk pays off you can expect a higher return as well.

Understanding the differences – and choosing the best mutual funds for you

Everyone will have their own ideas as to which type of mutual fund will be best for their financial needs. Risk appetite, expectations and finances will all play a part, but it is wise to understand what options there are and which type of mutual fund will be the best choice. Once you know the options you can make an informed choice.

Do You Know Enough to Be a Successful Stock Market Investor?

For many people the obvious route to take when thinking about investing is to head for the stock market. But is this really the wisest route for everyone?

There is certainly a lot of money to be made with stocks and shares. However there are significant losses that can be made too, especially if you don’t know what you are doing. Unfortunately some people are tempted by the potentially big gains available. This means they can end up investing money in shares that are not right for them.

So if you are considering investing in this way, here are some points worth bearing in mind before you do so.

Can you invest money you would be happy to lose?

This is the main point to bear in mind, even if you know little about anything else. Investing your life savings in stocks and shares is not a good move. If the stock market were to crash – and as we know it has happened before on more than one occasion – you could lose everything.

This is why it is wise to split your cash and invest it in a number of different ways. It spreads the risk you are taking as well.

Do you have an interest in the stock market?

You don’t need to know the ins and outs of how a car works in order to drive one. But when it comes to the stock market it does make sense to have a rough idea of how it works and what kinds of ups and downs you can expect. Otherwise there is a much higher chance of investing money in volatile stocks. There is also a higher chance of viewing the market through rose tinted glasses – seeing only the potential gains and not the potential losses.

Do you understand not all stocks are the same?

Here we simply mean that some are issued by big name companies we’re all familiar with – Coca Cola or Microsoft for example. Others are issued by small companies that are just starting out.

Everyone wants to invest in the next big global success. If you know what to pick you stand a chance of making a lot of money – just as you would have done if you had invested in Microsoft shares right at the very beginning. But picking future successes is very difficult to do – and best done with money you can lose if that’s what it takes. It is almost a form of gambling when you think about it.

While the breakout successes will achieve the highest returns, they are very few and far between. You are more likely to make gradual returns on a more stable stock from a well known company.

So you see you may not necessarily be the right person to invest in the stock market. It all depends on your level of knowledge, how much you are willing to invest and whether you can accept the ups and downs of this particular type of investment.

How Much to Invest in Inflation-Protected Securities

If you are thinking about investing money, then you need to know upfront what amount you’ll be looking at getting back, right? Many people who invest casually or just invest to take care of things such as retirement fail to take the all-important issue of inflation into account when doing the math. This can be detrimental to an investment portfolio, however, and understanding how inflation will affect your bottom line decades down the road is imperative to maximizing how hard your money will work for you.

Understanding Inflation-Protected Securities

Inflation-protected securities (IPS) are a great way to keep your money growth outpacing inflation, but to use them correctly, you fist need to grasp what they are. A standard-issue nominal bond has a principal, interest, and a guaranteed payout that you can calculate at maturity. The problem with investing in these over the long haul is you will have no idea what the rate of inflation will be on the date your bond matures, so you run a serious risk.

On the other hand, an inflation-protected security works in a similar manner as a bond, but the IPS accrues interest in two separate parts. First, the principal amount accrues along with inflation, and then the entire amount is paid when the IPS hits its maturity date. The actual coupon payment is made based on a real rate of return, so even though the IPS coupon is initially lower than a nominal bond, it’s paid out on both the principal and the interest that has accrued since it was originally purchased.

Should You Invest Heavily in IPS?

Quite a few different financial advisors think that investing in IPS qualifies as fixed income, but it’s not the case. In truth, these investment vehicles are their very own class of securities. You can’t really compare IPS investments to regular fixed income or equities because it just doesn’t make sense.

That’s precisely the reason that IPS make great additions to a portfolio for the sake of diversification. Of course, no one would want to invest in IPSs as a major chuck of their investment holdings because of the unpredictable nature of the possible returns, so investing in IPSs sparingly is the best way to diversify.

The reason that these are a fantastic way to round out your portfolio is that the rate of inflation is unpredictable, but when IPSs fluctuate in tandem with the rate of inflation, you won’t lose money as you would with a fixed investment of a similar nature. Fixed investments will earn the same rate of return, so the potential for real profits is not as secure as it is with their IPS counterparts. Moreover, since sovereign governments issue these bonds, there’s very little risk, so you can invest your money with confidence. Overall, it’s a good idea to add IPS coupons to your holdings to spread your money as far as possible to maximize your returns.

-- .sidebar-primary -->