Money Archives - Page 3 of 3

Will Cash Retire

PayPal changed the world by offering an online exchange of funds between anybody in the world. Now fast forward a decade later and almost every bank offers electronic money exchanges. Some of you are thinking nah physical money will never go away. But I think one day it just might face a horrific demise. Not that I am a proponent of this happening, I am all for holding those green dead presidents in our hands. I just think the tide will turn one day and there is nothing we can do about it, the government will have the last say in this argument. Have you heard recently about BITCOIN and all the hoopla facing this weird monetary vehicle? Well this is the eventful future and not exactly like those coins, but something similar to it. Thus I keep thinking will cash retire?

Have you ever seen an option to send money online now days by your bank? Well they are all pushing for the end of physical cash because then they will have less operating costs. Is this a shock to all of you? I hope not because as you should know banks always want to decrease expenses while controlling the money with tight-fisted grips. A digital age is becoming more prevalent as wire transfers become just as easy to send as having somebody’s email. Soon there will be an app for that as cell phones are holding more power now than a computer for managing finances on a daily basis. Wait that little white device (Square) that can be attached to your cell can accept a credit card payment for services rendered in a summer garage sale. Guess what that device will eventually assist the final retirement party for good old Benjamin Franklin. Don’t say I didn’t warn you, but maybe you will now realize that this could very well be the future of money.

Here are a few facts about; Will Cash Retire:

-Canada got rid of the penny, soon other coins will follow

-USA wants to get rid of all coins

-Direct Deposit is pushed by all employers and government programs. (Social Security/ Disability/ Unemployment)

-Banks only give promotions to new customers when you set up direct deposit

-Retail Companies want you to get their store card (20% off if you do it – One time)

-PayPal money exchanges are growing every day (Be Careful There’s a fee for this service)

-Square is taking over! 6 Billion Yearly in money exchanges- wowzers (It will cost 2.75% of all sales)

-Online Banks like ING offer the same service to send money to others.

-BITCoin ATMs will soon hit a mall near you. (Hopefully a Fad)

-Trillions of dollars are being exchanged everyday by Currency Dealers (Largest Exchange in the world)

-In 1990 Cash and checks consisted of 85% behind all spending; now it is about 39%

-Every day we all are using less and less cash (See a trend)

-In 2010 3.1 billion was paper transactions and 4.8 billion was cards/electronic

What do you think of those facts? If somebody all the way in japan wishes to purchase a product you have listed on EBay, no problem PayPal to the rescue. I feel that one day we will be viewing physical cash in a museum, unless you are a PF blogger and have the foresight to stash a variety of crisp bills in a photo album hoping they will turn into a collectible one day.

Will Cash Retire? Comment below with your point of view on this topic?

For further Reading look here:

Rich Uncle EL

Some facts were found in Fortune Magazine

Money Lessons I

I believe money lessons are very important aspects of life to help anyone be great with money management. The lessons we learn can come from random places within life and at random moments. What I am hoping to accomplish with this post is to make all of you aware of the mistakes you should avoid, this will solidify, if you finish the post, the important message you will receive below.

Money Lessons:

Never take out a pay-day loan, interest is about 359%. (Just not smart)

Do not ever pay a debt consolidation company to help you get out of debt.

Avoid missing or being late on a loan payment

Owe the IRS, pay them off ASAP to avoid penalties and interest fees

Never borrow from the 401K as a loan (Unless you will avoid bankruptcy/foreclosure)

Do not get your pay garnished by being irresponsible and not making payments

Avoid bankruptcies and Foreclosures as it will damage your life for 10 years

These are some of the worse money mistakes you could make with personal finance. I think with information many money decisions and or mistakes can be avoided before a serious issue may arise. On the other hand if you do not care and are living life by always yelling out YOLO then one of these issues might hit your doorstep if you are not careful. Digest all of these lessons to make you an efficient and powerful decision maker when it comes to handling your paper.

I hope you all have never experienced the mistakes above because they are a total bummer. It can take you years to recover from getting your Money mojo back on track. On the other hand if you are struggling with one or a few of the issues listed above, you can get help from a financially responsible family member or read more personal finance books to improve your situation.

Comment if you agree to avoiding the money lessons listed above?

Rich Uncle EL

The Money Mojo

What is the money mojo you ask? Well it is the point in your life when money is flowing like an open faucet. When you experience a day, a month, or maybe a year in this stage you will feel tempted to increase spending and ball out. If you are smart you could make your money work harder for you while in this stage. How do you ask? By continuing to live life as if you did not have a money mojo going on at the moment. Lifestyle inflation is something that creeps up on most people and spending takes over their lives. Many strategies can be utilized to assist you and will prevent wasting your money mojo and the future earning power of that mojo.

Continue reading The Money Mojo

The New PF blogger Anthem

Check out this cool video by Macklemore called Thrift Shop, rapping about being frugal with money. This guy is hilarious and has a pretty cool catchy song that has 125+ million views on YouTube. I laughed out loud at least 3 times while watching and listening to this video. We all need artist to be real like this guy talking about being smart and not getting swindled by the luxurious clothing brands pimping t-shirts to younger persons for 50 dollars a pop. The clothes do not make the person, the person makes the clothes look good by rocking it with confidence and style. Also cars should not define who you are by impressing random people you will never get to know at a red light. Please listen to the video and take heed to what he is saying and trying to express.

The New PF Blogger Anthem:

Video by Macklemore ft Ryan Lewis: Thrift shop

I personally think this song is a great twist to the thousands of current songs who send a bad message to todays youth that spending on chains, cars, and watches is ok while you are broke. Most of the younger kids listening to these songs are just starting out in life and we actually need more songs spreading the truth about money. So if you are different from the normal person who thinks they need brands to help themselves feel better, share this with others to help them wake up. Every dollar you spend buying that 120 scarf goes to a CEO’s pocket and away from your retirement funds.

Tell me what you thought of the video and if you understood the overall message behind the song.

Rich Uncle EL

Chess is like Money Management

Why do I feel chess is like money management and therefore can be compared to one another? Well for the most part I like the fact that I embrace both of these as a part of my life. I also believe that with practice the things you enjoy doing can be perfected every day. See below for my list, which helps solidify why chess and money management are very similar through my eyes and hopefully through yours as well:

Continue reading Chess is like Money Management

Asset Allocation

Why is asset allocation important? Basically you are dedicated to a specific breakdown of financial sectors that you may or may not have knowledge what the breakdown should be. The possibilities are endless when it comes to the asset breakdown for your retirement accounts. Finding the right asset allocation is crucial to how your investing performs.

But it all comes down:

What you want to invest in
How much Risk you wish to take
Why your age may favor a specific breakdown
How comfortable you are with making adjustments

For years many investment gurus preached that the younger you are the higher your percentage of funds should be in U.S. Stock sector but now I think that is not the right way to invest. The volatility now a days is getting way to out of control for even the professionals to grasp.

What can you do to put yourself in the best possible path for your funds? Understand the importance of doing asset allocations based on you’re percentages and fund prices. (If you are into spreadsheets and tracking prices you will benefit from the ups and downs of the market)

When I say for you to make these allocations, I am referring to your 401K or similar plan which may include IRA plans as well. The reason I say this is because these types for accounts usually do not charge you fees for making moves / shifts between funds. Now let’s discuss the % breakdowns by age range.

Asset Allocation by Age:

20-30s: 70% U.S. Total Stock Fund, 15% International Fund, 15% Bond Fund
40-50s: 50% U.S. Total Stock Fund, 30% Bond Fund, 20% International Fund
60-70s: 40%U.S. Total Stock Fund, 40% Bond Fund, 20% International Fund

Clearly as you get older you want to start to move the risk away in retirement accounts by reducing your % in the U.S. equity markets and moving it to bonds, income producing assets, and cash. This will assure you will be better protected if there is a dramatic market collapse like in 2008. These diversification tactics coupled with the lower costing index funds like Vanguard funds you will have a greater chance of hitting your retirement magic number sooner than later.

Then you can be preoccupied with what to wear to the beach because you have just reached the financially free stage of your life. Now the fun begins.

Asset allocation definition as per Investopedia

Rich Uncle EL