Month : December 2018

Money Management

Cost VS Value- Three Strategies for Success

Lime Time

One of the simple unavoidable facts of life is that everything costs money.  It can be frustrating spending your entire paycheck week after week with little to nothing to show for it.  Learning to understand cost vs. value will help you get the most for your weekly checks and make the most of your personal finances.

Cost is simple to understand.  How much money are you going to have to spend for this item?  This is the cost.  Value on the other hand is a little more complex.  Value can come from many different places.  These three key ideas will help you master the art of determining if the cost of an item is equal to or lower than the value.

Cost, Value and Where You Live

Think about your house or apartment for a minute.  Do you live in the cheapest part of town?  Why or why not?  The answer to this question is one of the building blocks for understanding cost vs. value.  Sure, you could probably crash on your mom’s sofa for free but having somewhere else to live has a value.  You may be willing to pay more for a smaller apartment in a good neighborhood.  Use this reasoning to guide all of your purchases.  A reliable car has a higher value than one that always breaks down.

A Premium for Convenience

A candy bar or a bottle of soda is more expensive at the gas station than the grocery store.  Why is this?  Gas stations and other locations charge a premium for convenience.  Is a gas station candy bar worth more than one from the store?  They have the same ingredients, the same nuts, the same chocolate, even the same package.  The value doesn’t really change but the cost does.  Learn to plan ahead and to ask yourself how to get the best value for your money.

Is This Actually Worth It?

Next time you go to make a purchase ask yourself, “Is this actually worth it?”  Is the cost of the item relative to the actual value?    As you learn to do this you will be able to start differentiating the cost of an item and its value.  In an ideal situation the cost will always be lower than the value received.

A great way to start mastering this skill is to determine the value of an item before you see the price.  If you are considering purchasing a new item, look at it first.  What do you think it is worth?  Then look at the price and see how they compare.  This can be done with almost any product from shirts to pants to electronic devices.

What do you think?

photo credit: Marc A. Sporys

Money Management

Try This If You Suck At Budgeting

I came to the conclusion that budgets don’t work for everybody because it doesn’t really work for me. Especially since I have a significant other and we don’t always see eye to eye. Yea a budget helps me to see if I’m spending more money than I’m taking in but I’ve learned to use Outright.com to keep track of that. Yea it’s for small business but it does the job of keeping track of my total income and expenses without having to worry about setting up categories.

My “You Know” theory

My theory is that we all know what we’re doing when it comes to spending. We know if we’re spending too much but we just don’t want to face up to it. Well you won’t be helped by this. In fact, you really can’t be helped by any plan until you change your attitude. Go get help.

Cut down on the extras

For everyone else that actually wants to change their situation try this idea. Just cut out half of what you do. No I’m not talking about fixed expenses like rent or mortgage. I’m talking about things you can actually control. If you eat out for lunch 5 days a week, try to make your own lunch 2 days or even 3 if you’re feeling spunky. If you don’t want to cut out  buying lunch then cut out something else more than half. Instead of shopping every weekend so shopping just once a month. Sign up for Outright.com so you can see how you’re making progress.

No this isn’t going to work for everyone but if you’re having a problem sticking to a budget or you don’t know how to start, try this.

This is going to teach you to sacrifice. Yea it’s a tough word but it’s just that, a word. It’s not going to kill you to sacrifice, but it will make you stronger financially. I tried looking up another word for sacrifice that was nicer sounding but there isn’t one. But here’s a word that is good, Freedom. Freedom to live without the stress of debt and without knowing how you’re going to pay to fix your car because it just broke down.

Start now

Don’t wait to have to sacrifice when you’re in a crunch and have to stop everything you’re doing. Sacrifice a little now so you’ll get financial freedom. So don’t start a budget, start sacrificing.

What do you think about this?

 

Business

The Benefits of a Business Savings Account

Regardless of the size of your business, there is a financial solution available for you. The commercial banking sector is very lucrative, therefore more and more financial institutions are looking to broaden their client base by offering very favorable business banking solutions to all kinds of businesses.  Particularly, business savings accounts are very important for anyone in a commercial venture.

When it comes to running a successful business, it is essential to have an efficient cash flow system. There is usually a lot to juggle, from employee salaries, vendor contracts to restocking. A business savings account can help to maintain smooth financial operations in your business through helping you to maintain that suitable level of cash flow.

Business current accounts pay very little interest and at times none at all on the money held in the account. If you want your money to work and earn quality interest amounts, a business savings account is exactly what you need. The competitive rates of interests and bonuses in these savings accounts are usually very good.

Since the commercial banking sector is so competitive, there are also very many bonuses and specials that come with these savings accounts. Every financial institution wants to the on the front line as consumer favorites and the only way they can do is b y adding something extra to these accounts. These bonuses can boost the headline rate if well taken advantage of. However, bonuses are only periodic so always review the status of your account after.

Another advantage of a business savings account is that interest is paid on gross and not net, therefore you can enjoy better interest levels regardless of the tax charge.

It is important to get a financial advisor to help you in making good use of the benefits of these business savings accounts. With all the great offers and account types out there, it is also important to know that these financial institutions need also to put their best interests forward. There are many ways through which they make profits; account fees, deductions and monthly charges among others.

Get a financial professional, discuss the various savings accounts and savings options out there and draft up a plan through which you can enjoy the most favorable conditions for saving. Find out also, the state regulations, tax information and protections on savings accounts in your region for these business savings accounts.

Mind Over Money

The Biggest Gamble We Must All Make

dice I never finished college. I just didn’t like learning things that had nothing to do with what I wanted to do in life. Especially when I really didn’t know what I wanted to do in life. I chose the path of pretty much not going to college and I don’t regret it. I’m taking a gamble and I hope it pays off. I was lucky in that I didn’t have to take out any unsecured personal loans and end up getting nothing out of it.

Go to college

The story these days is that you go to college, get a degree, and then stay at your parents house because you can’t find a job. As the economy goes south, so does the risk of not getting a job after you graduate. What college gets you is a better chance at success in the corporate world. You have a chance to get more connections and you’ll have a degree that shows proof that you can finish what you start.

Life is easier with a degree, plain and simple. But that’s only if you use it to the full potential. What if you’re not good at socializing? What if you’re not that interested in getting a degree? Then college is probably a bigger risk of failure to you and maybe you should have foregone college and got a head start out of high school.

Don’t get me wrong, college is a great experience and you can get a lot of connections that will serve you well after you get out. But that’s if you make the effort to get those connections. That’s all part of the gamble.

Don’t go to college

If you make this choice the road is a lot harder. However, it can give you a head start.  About 50% of the people that go to college drop out. If you take that route, then you wasted time you could have had in the workforce or starting a business.

Once you get out of high school you have to make a choice of which path you want to choose for yourself. If the economy is down like it is you have a better chance of just joining the work force or even starting your own business. When the economy’s down the risk of going to college and not getting a job are about the same as starting a successful business that you control.

I could either go to college and risk not getting a job when I get out or not go to college and risk that I won’t be able to go up in the ranks at work because I don’t have a degree.

What I’m getting at is that you have to make a choice of whichever one you feel will give you the best chance of happiness. I chose what I feel will be a harder road but I think I need that challenge in life.

What road did you choose? Do you regret your choice?

I’ll start. While I wish I started out sooner, I will say I did learn a lot about myself by going through the college atmosphere. So, I don’t regret it because I don’t know where I would be today if I didn’t attempt college.

Mind Over Money

The One Asset You’ll Always Have

In Search Of Lost Time

The first thing we own as a person when coming into this world is, you guessed it, is time. There have been many situations in which both I and you have used the phrase “I spend my time doing x” and neither of us has realized how the way we think and speak affects our life. The first action is born at the level of the mind known as the subconscious and it becomes motion in a couple of Nano seconds leading to action.

Invest it

Instead of “spending time” we should choose to “invest time”. We should invest time in activities which make us feel better physically, mentally and emotionally. If we focus on being healthy we will be able to enjoy life more and also work more which in turn will mean more money into our pockets.

If we invest time in reading about personal finance then our mind will grow and we will know how to pay ourselves first and protect the money we work so hard to earn by learning to work smarter not harder. If we have a balanced personality we will be in a good mood and have a nice positive vibe which will attract more wonderful opportunities and people into our lives that will mentor us on how to become wealthy.

To be wealthy means to be successful on all the levels of your life: family, career, personal level of development, social relationships and financial status.

The way you invest your time as a person will determine whether you will be poor, belong to the middle class or be a part of the exceptional people known as rich.

Use it wisely

Most of us after a whole month of work are tempted to go spend the money that is left over after taxes and bills are taken care of on various treat or activities. We love to spoil ourselves and we all know it. Instead of eating this big piece of candy at the end of the month take that small sum of money and put it away in a savings account. Delay gratification! If this piece of candy makes you feel so good about yourself now, imagine how good it will make you feel when you have six times as much and decide it is time to increase your income by investing the money into something that will raise your standard of living.

Take a course about something you always wanted to learn and get certified! Switch your line of work to what you have always wanted to do and begin making more money. Now that you are certified you will begin to receive more offers and you will notice an increase in monthly cash flow.

You are one of the best

The truth is the majority of people we call rich are people like you and me. The portrait of the billionaire no longer resembles to a corporate suit that works 18 hours per day and drives to work in the most expensive foreign car just because he loves to attract attention.

The modern day billionaire is a person that had a normal life growing up, some even mediocre. They had no special talents or didn’t benefit from the whole education package and decided it is time to make their own way in life, so they learned about personal finance.

Personal finance is not about spending money, but about how to keep as much of the money you make as you can. The first investment you should ever make is in yourself.

Take the time and the money that you’ve made today and invest it in yourself so by the end of year you will have made even more money! In case you have noticed that I have said the end of the year instead of tomorrow that is because the process takes time. Stay true to the principle and put in the work and you will be on your way to wealth!

How do you use your time wisely?

photo credit: bogenfreund