Category: money

Top 10 steps for Money Growth

Warren Buffet

Money Growth Steps

  1. Protect your income- Save those dollars
  2. Live for tomorrow by watching what you do in the present
  3. Avoid debt like the plaque
  4. Keep expenses very low and do not succumb to lifestyle inflation
  5. Increase retirement and emergency contributions by 1% or more every year
  6. Have piggy bank and every year cash in the coins for savings or debt repayment
  7. Use as many rewards / cash back programs as possible
  8. Work harder in finding side gigs
  9. Buy assets that pay interest or dividends
  10. Read PF Blogs and watch your Net Worth

These are all the steps I do to increase my nest egg and I think each and every one of you should do the same. I sometimes feel with simple steps, we all can see great results. These steps are things you may have already done in the past, but maybe you are too busy with life’s routine and have not adhered to some of the steps above in a while. Well I am here to set you on the right money path. Find the time and the energy to do what is right to make your wallet fat with dollar bills. Don’t be like that baby in the capital one commercial that turns down free money. Use the skills you have and follow your path to achieving a greater sense of financial freedom.

Personal growth comes from realizing who you are and then improving on your weaknesses. Thus changing bad spending habits into routines that will enhance your money mantra. A lot of you are already realizing that to make it in life is getting harder then folks had it back in the good ol’ days, but do not fret as you have the ability to change and improve. Follow the steps above while establishing a online financial system to really change your future.

The pic above is a shot of the most successful business person ever: Warren Buffet. He is a living definition of what it is to have money growth. As he grew up in the middle class and now is worth over 40 billion dollars.

Comment if you already follow the steps listed above or if you have another system you use to stay in tuned with your finances?

RichUncle EL

Pic provided by AP press.

Personal Finance

What does this title mean to you? Do you want to know what it means to me? It means being in control of your financial life. The standard definition by Wikipedia is:

Personal finance is the application of the principles of finance to the monetary decisions of an individual or family. It addresses the ways in which individuals or families obtain, budget, save, and spend monetary resources over time, taking into account various financial risks and future life events.

I think that definition in its entirety said exactly the same thing I said in the sentence above just with a bit more fluff. Being in complete control over your finances is proving to be an extremely difficult task, as people every day are taking a step forward and two steps backwards. A shift in how we handle money needs to be taken into serious consideration because people still have not gotten the memo. Granted nobody is perfect and we all make mistakes in life, you and I are included. I am still paying for student loans that I did not want to take out, but did allow me to graduate within 2.5 years from beginning to end. Those student loans are the only thing left on my list of life debts and they are not cheap as interest charges are 6.8% of the total. I hope I can stick to my goal of paying it off in two years.

Continue reading Personal Finance

Top 10 things that Impede Money Growth

Top Ten List:

1-Not having a budget

2-Having a shopping addiction

3-Spending more than you earn

4-Having a Gambling problem

5-Not changing bad money habits

6-Being addicted to vices (alcohol, cigarettes, drugs)

7-Having a small vision mind frame

8-Not investing in a retirement plan

9-Debt

10-Keeping up with the Joneses

All of these things will stop any inkling or possibility of growing your piggy bank. Money as I have mentioned before is a vehicle that needs to be steered in the right direction. A wise man once told me to see the big picture of everything and also that the little things in life add up to make a big difference. For example I know some people who do not invest or increase gradually their 401K employers retirement account because they feel that somehow the government will restrict full access to this money in the future. That is in my opinion somebody not seeing the vision compared to a financially minded person. Granted we can not predict the future but I can bet that the people will not let the government just raid our retirement accounts. (Social Security is another topic and could get crossed out of the retirement equation in a decade if they do not fix the system.)

If you notice the list above you will see all the negative barriers that we sometimes place on ourselves for various reasons. If you can successfully go through each list item and not be affected by any of the ten things then you are definitely winning in the money game. Just to get a bit personal and disclose to all of you the list items I have overcome as I used to mismanage my money for a few years. I am guilty of list items 1, 2, 9, 10, but now I am cured. The problem I remember I had was that I didn’t really feel like nothing was wrong with me because if I spent money most of the time I saved money on the flip side, thus being in denial. I was always a saver even though I was a shopaholic of watches and sneakers. Two wrongs don’t make a right and I had four wrongs.

If you could be so kind, let us know what list items you have been plagued by or guilty of and have been cured of in a comment below.

Watch your Money !

RichUncle EL

CD Ladder

I wanted all of my readers to get a better understanding of how you can make some dollars doing a CD ladder strategy. CD’s come in many different time frames and this very fact can be used to play a game with the rates offered. The longer the time invested the higher the interest rate you will get. The trick comes into play when you might need some of the money and the solution is to do a CD ladder. Basically you will have access to an equal portion of your money every year with this strategy.

For the sake of this example I will only use the 1, 2, 3, 4, 5 year maturity terms for each CD. The rates can be obtained from many sources but if you run your own calculations feel free to use bankrate.com.

After the first CD of 12 months matures you immediately reinvest in another 5 year CD at the five year going rate (unless you need the funds) and this CD will mature in year 6 of your plan. Keep this going with every year, you will add 5 year CD’s from this point on and continue the same cycle forever as one of your CD’s will mature once a year. Form this point on you will continue to build up assets as with each CD maturity you will add more money every year as the accounts compound interest. After the first three years you might say to yourself this is not paying enough, but on average things start to eventually pay a lot more after the fifth year and so forth.

Also this money will be part of your liquid emergency funds as to diversify and compliment your retirement and stock investment accounts. You do not want all your eggs in the stock market as the markets might collapse. In addition to the funds growing for you risk free (FDIC Insured), after the initial account openings of 5 accounts this system will not take much of your time. The only time you have to invest is to go back to the branch once a year to renew the maturing CD to the next 5 year CD and hopefully the rates will be higher than the current 5 year rate of 1.79% when you started the accounts. (Which means you will earn more than my example)

Also something to consider is if you had another sure fire risk free way to make more than 1.79% on your initial investment than it should be considered and favored over the CD Strategy as these rates are very low. Very Important fact to consider: if inflation is more than the rates you are earning then you are losing purchasing power on your money. But it still is more economical than a standard savings account or under the mattress strategy.

*CD’s have a fee if you withdraw prior to the maturity date usually its 3 months of interest as a penalty. All CD’s are protected by FDIC for up to 250 thousand dollars so there’s no need to worry, no risk and all reward. (Even though the reward is less than other investments)

*FYI-These rates on CD’s were offered by Ally Bank which is an online bank and not a regular branch that you can walk into.

*The bank you are giving your funds to will pay you this low rate and loan it out for a much higher yield and that is the reason why banks still offer these types of products. As the economy improves so will these rates and then that will be the optimal time frame to get CD’s.

Another alternative and fun way to watch and make more money.