money advice

Financial Advice for College Graduates

June 28, 2016 By Amanda Blankenship 1 Comment

Many students walked across stages at their universities last month to receive their college diploma. These students were stepping across the stage towards their futures, their blossoming careers and, for some, crippling financial struggles.

Seven in 10 college graduates (about 69 percent) graduates with over $28,000 in debt. As if this isn’t enough, most college graduates are also setting out to begin paying all of their own bills for the first time and taking charge of their personal finances. If this is you, don’t worry. There are a few things you can take note of to keep control of your finances in this new chapter of your life.

Pencil out a budget. Using pencil is a key here. During the first few years out of college, many graduates change jobs. They sometimes make more money (or less) and their budget has to be adjusted. Drawing up a budget and sticking to it is important for overall financial wellness.

Begin retirement planning with your first job. With the first job you get out of college, you should begin planning for your future (if not before then). You can set up automatic withdraws from your paycheck and stack up money in a 401(k) or Roth IRA for retirement. Oftentimes, if the company has a retirement savings plan (like a 401(k)), your employer will match your contribution. You will also get a tax break on the money you put into your retirement fund.

Know the value of your money. When you look at purchases, you should think about how much time it took you to make that money. For instance, if you are thinking about buying the new FitBit watch for $300, think about how many hours it takes you to make that money. If you make $15 per hour, you would have to work for 20 hours to get that FitBit watch. Is it worth it?

Don’t be afraid to move back in. Moving back in with your parents is something almost every college student fears. If you’ve been in a dorm for four years, moving back in with mom and dad can seem like a drag. You go from having all the freedom in the world to having to follow your parent’s rules again. However, you can benefit from moving back home. Taking up residence at your parent’s house can help you save money, give you time to focus on finding the job you want and can also be a nice change of pace from the hustle-and-bustle that was university life. Don’t worry. You won’t be there forever.

Don’t use your credit card as a default payment method. Lines of credit should only be used when it is necessary or when you know you can pay the bill in full. For instance, many people use their credit cards for their day-to-day purchases to rack up rewards. This is perfectly acceptable if you don’t overspend. Simply purchase the things you would always purchase with your credit card and then pay it off in full each month.

You have to have an emergency fund. Having money set aside for emergencies is a must! The loss of a job, car repairs and some medical bills can’t be foreseen. If you have money set aside for these unexpected costs, you won’t have to go into debt paying for emergencies. The ideal emergency fund would have at least $1,000 to $2,000 in it.

Continue learning. Even though you are done with college, you should never stop learning, especially when it comes to your finances. Pick up a few finance-related books, take a finance class or find a financial advisor to help educate you about saving and investing. Never stop learning and educating yourself.

Splurge a little. While saving and planning are important, you should also splurge a little bit of money on experiences while you are young. Many students take the summer after college to travel. If you have the opportunity to do so, you should. Don’t be afraid to spend money on experiences.

What advice would you give to new graduates?

Photo: Flickr: John Walker

10 Common Money Mistakes You Can Avoid

June 10, 2016 By Amanda Blankenship 1 Comment

Money management can be difficult. People often make mistakes when trying to handle their money. Common money errors can prevent making progress on long-term financial goals and can often set a person back. The common of these mistakes can be avoided though.

By changing just a few habits, you can change your entire financial stance. You can cut bills, have better cashflow and even boost your investments. All of that sounds really exciting, but you will have to make a few changes before you can reach that level of success. Take a look at these 10 tips to help you avoid making some huge money mistakes:

Take the right risks. When it comes to your finances, a certain amount of risk is present (especially if you’re dealing in the stock market). You may panic at some point in the beginning when you see the apparent risk. If you don’t handle these correctly, taking a risk can ruin your financial stance in the world. Before you take any huge risks, make sure you understand what could happen if it goes wrong as well as what it will take to fix it if it does.

Set your goals. Sometimes life gets in the way but you should always have an end game. For some the goal may be to quit their 9 to 5 job. To do this, you would have to secure a significant source of passive income or a more flexible job. Others may have a goal of saving, say, $2,000 by the end of summer. They would have to adjust their spending. Without these goals, there would be no reason for change or to push towards something more. Always have a goal and keep your eyes on the prize.

Set reachable goals. According to The Hip Pocket, many people make the mistake of aiming for goals that are simply impossible to reach. You must decide what it important to you financially, set goals and then figure out what you must do to reach those goals. Assess your ability to do those things and set a reasonable time frame. If you do not have a good idea of what is doable, you’ll wind up setting yourself back.

Take time to learn. When approaching big money decisions, learn as much as you possibly can about what you are about to do. For instance, if you are about to put a substantial amount of money into the stock market, you would want to research the company (or companies) you are putting your money into. If you do not know enough, you will not be able to assess the risk nor will you be able to set obtainable goals.

Don’t make it hard. Saving money and managing it is hard enough without you making it even harder for yourself by manually transferring funds or taking cash out and putting it aside. Instead of doing things manually, you can set up direct deposits and automatic transfers. In addition to this, many investment apps also allow you to make automatic deposits into your investment account each month as well. You can save yourself a lot of trouble by automating your financial decisions.

Set a budget. This is a pretty basic step but you would be surprised by the number of people that do not have budgets. Time reported that 82 percent of Americans don’t keep a budget. This sets many people back from financial wellness. Without a budget, you won’t likely be able to reach your financial goals.

Don’t spend for rewards. People with credit cards that have cash back rewards or other rewards often spend simply to get the reward, thinking they are saving money by receiving the cash back. This simply is not true unless you are using a credit card hack like these. You are still spending unnecessary money and spending outside of your budget.

Stop accepting fees. Banks, credit card companies and other financial institutions have a lot of fees that you can avoid. For instance, many people simply accept ATM fees by using out-of-network ATM machines. If you plan on taking money out, you can plan ahead to get cash from your bank’s ATM and avoid the additional $4+ in ATM fees.

Have an emergency fund. Emergency funds are extremely important! A recent report showed that most Americans do not have enough money to cover a $1,000 emergency. Without this money set aside, many people go into debt trying to pay for car repairs, medical bills and other emergencies that simply happen.

Don’t try to do it on your own. You can seek financial counseling. Many people seek this type of counseling so that they are able to open a loan, buy a house or if they have met financial hardship. However, you do not need to wait until you NEED some financial counseling to get it. Consulting with a professional about your finances is never a bad idea. Once you share your goals with them, they can help you reach success. Never be afraid to ask for some guidance.

Do you have any tips on how to avoid common money mistakes? Let us know.

Photo: Flickr: 401(K) 2012

Money Advice No One Follows

January 5, 2016 By Amanda Blankenship 1 Comment

When looking at tips for saving and money management, there are a large amount of tips that simply go unfollowed, but why? Some of these overlooked tips and ideas when it comes to saving advice and money management are key to being successful financially. Here are five great tips that practically no one follows:

Save the difference in price.

Bargain hunting is a great way to save money. If you clip coupons or even go searching through ads for the best deal, that is great. However, what do you do with the money you save getting that bargain? You probably spend it. You should put what you save into savings. For example, if you went hunting for a bargain on milk and got 50 cents off at a different location, put that 50 cents in savings.

Your financial life is like a business.

Run your financial life like a business. If you do this, you can be successful. You should treat your budget like a business because the bottom line matters, just like it matter in business. You also have to prioritize, assess and restrain when it comes to your personal finances, just like businesses do. Everything that keeps a business afloat will keep your own personal finances in order. You also have to keep the big picture in mind like saving for retirement or paying off debt.

Pay yourself first.

Of course, you have to make sure your bills are paid every month. However, when you get paid, you should also pay yourself. This should be part of your budget. To do this, you should automatically transfer a portion of your paycheck into savings. A good amount to automatically set aside is 10 percent.

Saving is a lifestyle.

If you make saving a lifestyle instead of something you do from time-to-time, you will find your finances in a better place. Some people compare saving and dieting. If you diet, lose all of the weight you want, and then go back to the lifestyle you had before, you will gain all of your weight back. The same goes for saving. If you change your lifestyle to save, and then you just go back to spending whatever you want, you’ll likely eventually lose what you’ve saved.

Spare change savings.

Another great tip many people don’t take advantage of is to save, and even invest, your spare change. Some banks have a “round up” option where they round your debit card purchases up to the nearest dollar and they place that spare change into a savings account for you. If you spend more cash, you can also get a mason jar or even a piggy bank and start putting your loose change into the jar. You will be surprised to see how quickly the change stacks up.

Sometimes, we hear pieces of advice and we know that they are great, but we just simply do not want to follow them. However, these few money advice tips are some that you should consider following. They will change the way you view, handle and save your money.

Money Phrases That Hold Us Back from Wealth

June 4, 2014 By Guest Writer 1 Comment

By Steve Siebold

There the money phrases we’ve all heard before, but are they working for us or could they actually be holding us back from acquiring a substantial amount of wealth? I say to be very careful, as some of these seemingly harmless phrases about money can actually interfere with the wealth-building process. Here are a few of these common phrases that you may not have thought too much about, but how they can affect your finances.

It takes money to make money

This phrase is limiting at best and destructive at worst. The truth is you have to have great ideas that solve problems to make money. If you do, you will attract money like a magnet. Wealthy investors are always on the lookout for the next big investment they can sink their teeth into.

Money doesn’t grow on trees

Figuratively speaking, money does grow on trees; and the trees are ideas. This belief sets people up to believe money is scarce and difficult to earn, instead of seeing money as abundant and earning it is as easy as solving a problem through persistent, creative thought.

Another day another dollar

The masses trade time for money. This creates the belief that making money is a linear process directly connected to time. The average person believes the only way to make more money is to work more hours. Big money requires thinking about it in non-linear terms.

Money is the root of all evil

The real saying is actually “the love” of money is the root of all evil, but has been misquoted for centuries that most people believe money itself is the root of all evil. Decide to be proud of your ambition and ignore people who tell you that wanting to be rich is wrong.

A penny saved is a penny earned

This is a very dangerous belief as it put a major emphasis on saving. Saving in itself is not bad. The problem is far too many people end up focusing mainly on things like clipping coupons that they miss major opportunities. It’s important for people to get beyond the nickel and dime saving attitude so they can focus their mental energy where it belongs: on the big money.

Money can’t buy you happiness

The most common misconception about money is that more will make you happier. You don’t get rich to get happier; you get rich for the freedom in brings. It allows you to live life on your own terms, but it’s unlikely to make you any happier. If you’re unhappy without money, you’re not going to be happy with it.

A penny for your thoughts

This is usually a harmless phrase when people just want to know what’s on your mind, but be careful: If overused and it penetrates the subconscious, you’ll start giving away your intellectual property for practically nothing. Your IP and unique perspective can potentially be worth millions if packaged properly.

Selfishness is a virtue

The masses are programmed from an early age to put the needs of others before their own. While this sounds like a spirit-driven, high-level philosophy, it’s the worst advice you can get when it comes to money. In order to make a lot of money, there is a period of time in the beginning of the wealth building process where you must focus on yourself and your business in order to make it at an uncommon level. Once you acquire wealth, then you can volunteer or give back to charity.

When it comes to money, the best advice to remember is to always look at it from a consciousness of freedom, possibility, opportunity and abundance. Never look at money from a fear and scarcity point of view.

Steve Siebold is the author of How Rich People Think using interviews from over 1,000 of the worlds wealthiest people he’s conducted over the last thirty years to show how they think differently than the middle class. You can learn more at his website How Rich People Think Book.

(Photo courtesy of Ervins Strauhmanis)

14 Money Lessons from Benjamin Franklin

May 15, 2014 By Danielle Warchol 6 Comments

Long before the financial gurus with their TV shows and personal finance books to sell were around, Benjamin Franklin was giving down-to-earth, sound money advice to anyone who would listen. The advice was so sound that it’s still relevant and applicable to this day. Here are ten money lessons from Ben Franklin that you would be wise to follow:

“Money Never Made a Man Happy yet, nor Will It. The More a Man Has, the More He Wants”

Money doesn’t provide happiness. It’s a lesson that many people still have a difficult time remembering today. Ben Franklin knew that money was a means to an end, not the end itself. It’s a tool to help you do the things that make you happy, but it can’t bring happiness just by having it. And if you think that it will bring you happiness, you will always be seeking more because it will never fulfill what you hope it would.

“An Investment in Knowledge Pays the Best Interest”

When people think about investments, they usually think about getting the best interest return on their money. But Ben Franklin knew the best overall return you can get on your money is by investing in yourself and improving your knowledge and skills. When you invest in yourself, you widen your opportunity by being able to do more things. As he says, invest in your knowledge will give you the best return on your money.

“Diligence Is the Mother of Good Luck”

When you see someone that you think is financially lucky, chances are that there was a lot of hard work and diligence that went into that luck. “Luck” usually comes about due to a lot of factors most people never see. An overnight success usually took years of hard work to make happen. Benjamin Franklin knew that the “luck” that others seemed to have came about because they had done the work to take advantage of it when it appeared.

“Do Not Fear Mistakes. You Will Know Failure. Continue to Reach Out”

Everyone will fail from time to time, and this is actually important. In order to improve and get better at anything you do, you will make mistakes along the way. If you begin to fear mistakes, you’ll stop doing the important things you need to do because of this fear. Failure is a part of the learning process, including your finances. Don’t fear those mistakes you make, but learn from them.

“A Penny Saved Is a Penny Earned”

This is one of Benjamin Franklin’s most famous quotes, and it’s still one of the most useful for modern society. The adage states that saving money is the most important factor in financial stability and building wealth. Benjamin Franklin knew what he was talking about when it came to saving money, as he was able to put enough aside to retire fairly early.

“If You Do Not Exceed in Quantity as You Lessen the times, Half Your Expense in These Articles Will Be Saved”

This lesson goes hand in hand with the first lesson. If saving is the most important way to build financial stability, then it’s equally important to learn how to save. In this quote from “Plan for Saving One Hundred Thousand Pounds,” he suggests splitting monthly expenses in half. One half is allocated toward necessary amenities such as rent or food, and the other half on superfluous things like entertainment or luxuries. He goes on to say that by buying used items, or limiting the amount you spend on entertainment can help you save money.

“Don’t Give Too Much for the Whistle”

This quote comes from a story that happened during Benjamin Franklin’s childhood. When he was seven, he saw another boy blowing a whistle and wanted the toy for himself. He offered the other boy all his money in exchange for the whistle. He later learned that he had paid more than four times what the whistle was actually worth. He learned an important lesson that many people still need to learn: don’t overpay for items.

“Rather Go to Bed without Dinner than to Rise in Debt”

This lesson cautions people against living beyond their means. This is an important thing to learn as many people in today’s society often fall into debt because they spend money they don’t have in order to life a lifestyle they can’t afford. Living with debt severely impacts your lifestyle and you should do everything you can to prevent it. Readjust your lifestyle if it means you won’t succumb to debt.

“Think What You Do When You Run in Debt: You Give to Another Power over Your Liberty”

We all know that debt is an awful, stressful experience. As the previous two items on the list suggest, it’s important to not overspend on items so you don’t go into debt. As Benjamin Franklin says in this quote: when you go into debt, you’re giving up your freedom. When you’re so far in debt, your life choices start revolving around paying off that debt. Your first priority is the debt, and everything else is secondary.

“He That Is of the Opinion Money Will Do Everything May Well Be Suspected of Doing Everything for Money”

Benjamin Franklin cautioned people against letting money control them. Everyone wants to be financially stable and wants to make enough to buy the things they desire, and it’s easy to convince yourself that your life will be better with more money. But be careful that you don’t let your greed for money control your life. Some people will go out of their way and do risky things for money, sometimes ending up in debt or bankruptcy. Don’t let money control your life.

“Buy What Thou Hast No Need of, and before Long Thou Shalt Sell Thy Necessaries”

Because we live in a society that runs on consumerism and capitalism, people tend to over buy. One of Benjamin Franklin’s best money lessons is admonishing people for consistently buying items they don’t need and can’t afford. We’re all guilty of buying items we never end up using. If you’re looking to save money, consider whether or not you actually need the item you’re thinking of purchasing. Are you only buying it because it’s there in front of you, on sale, or convincingly advertised?

“The Eyes of Other People Are the Eyes That Ruin Us. If All but Myself Were Blind I Should Want Neither Fine Clothes, Fine Houses nor Fine Furniture”

A lot of people try to live beyond their means or compare themselves with neighbors, colleagues, friends, or strangers. If someone has a luxury car or designer clothes, they suddenly want it too, even if they can’t afford it. But why worry over these status symbols? If you can afford to buy them – great! If not, stop comparing yourself to other people and focus on buying what you can afford.

“Never Keep Borrowed Money an Hour beyond the Time You Promised”

This is another great lesson on how to avoid debt and save money. The longer you have loans or credit card debt, the more money you’ll end up paying in interest. This lesson is also useful for those times when you borrow money from a friend or family member. Paying it back in a timely manner is not only polite, but it means they’ll be more likely to lend you money again.

“Gain May Be Temporary and Uncertain, but Ever While You Live, Expense Is Constant and Certain”

This quote is especially relevant in today’s economy. Your financial stability might be secure one day and ruined the next. You never know when you could lose a job or suddenly win a million dollar jackpot. No matter what your current financial situation is, you know that you’ll always have expenses to pay and you should factor that into your daily life regardless of your personal wealth.

For more about Benjamin Franklin pick up a copy of The First American: The Life and Times of Benjamin Franklin. The book has something like 14,000 reviews on Goodreads.com with an overall rating of 4.19 out of 5. Fourteen thousand favorable reviews can’t be wrong. It retails for under $15 bucks so pick up a copy.

(Photo courtesy of Tetsumo)

Inspirational Quotes from Martin Luther King Junior That Can Help Your Finances

January 20, 2014 By Jeffrey Strain 6 Comments

Known primarily for his speeches and nonviolent guiding principles as a leader of the civil rights movement, Martin Luther King Jr. shouldn’t be seen exclusively as a civil rights leader. In fact, there’s some wonderful information for other areas of life which can be found in his quotes. Among that information, Dr. King had some quality advice that applies to money and finances. Here are some of his quotes and the lessons you can take away from them.

“If a man is called to be a street sweeper, he should sweep streets even as a Michaelangelo painted, or Beethoven composed music or Shakespeare wrote poetry. He should sweep streets so well that all the hosts of heaven and earth will pause to say, ‘Here lived a great street sweeper who did his job well.”

It doesn’t matter what your job may be. Whatever it is, take pride in it and do the best that you possibly can. It’s your approach to work (not the work itself) that matters most. All work, no matter how society may view it, is something that you should take pride in doing, and always put forth your best effort.

“If you can’t fly then run, if you can’t run then walk, if you can’t walk then crawl, but whatever you do you have to keep moving forward.”

It’s important to do what you can with the tools and resources that you have at your disposal. Always try to do what you can, but even when you’re in a situation where you have limited resources, still do something. Great strides are wonderful, but baby steps will move you forward as well.

“No person has the right to rain on your dreams.”

Your dreams and goals are yours, not others. Make them, and put in place the steps necessary to achieve them. Don’t let others dissuade you from your pursuit if that’s what you want. There will always be plenty of naysayers, but there’s no reason for you to listen to them if you have a plan.

“Every man must decide whether he will walk in the light of creative altruism or in the darkness of destructive selfishness.”

This applies to all areas of life, including how you choose to make money. There are plenty of ways to make a lot of money quickly if you’re willing to financially hurt others and be selfish. You have to make that choice.

“The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy.”

Your true self comes out when times are difficult, not when you have all that you need or when everything is going your way. We all face challenges, but it’s how we treat others and how we overcome those challenges that speak volumes about who we really are at our roots.

“We must rapidly begin the shift from a “thing-oriented” society to a “person-oriented” society. When machines and computers, profit motives and property rights are considered more important than people, the giant triplets of racism, materialism, and militarism are incapable of being conquered.”

Money and “things” are not what we should be striving for. They are there as a tool for us to better ourselves. Having a lot of material wealth, while it’s seen by many in society as what brings happiness, it is nothing more than a mirage. It’s essential to understand that it’s your connection with others, and not things, that brings happiness.

“The major problem of life is learning how to handle the costly interruptions. The door that slams shut, the plan that got sidetracked, the marriage that failed. Or that lovely poem that didn’t get written because someone knocked on the door.”

An important part of success in life is staying focused on what’s important, and not letting all the distraction that can take your attention away from that focus. There will always be unexpected hurdles and difficulties to overcome, but that doesn’t mean that you should let your attention waver from the important goals you are seeking to achieve.

“We are prone to judge success by the index of our salaries or the size of our automobiles rather than by the quality of our service and relationship to mankind.”

Society has a terrible habit of labeling “success” as material, when true success is what you’ve done to make things better. Again, money is a tool, not the end to itself. Your car doesn’t say who you are. The way that you act and carry yourself does.

“Life’s most persistent and urgent question is, ‘What are you doing for others?'”

In our pursuit to reach our goals, it’s essential to remember that the most important question to ask is not “How much money do you make?” but “How have you been able to make the lives of others better?” When you are able to learn this, then you come to realize that money is nothing more than a tool to help you achieve your true goals.