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12 Frequently Asked Questions About Student Loan Debts

For millions of Americans, student loan debts are something that is always in the back of their minds. They can be very complicated, and this can lead to a lot of questions. We’ve compiled a list of the most frequently asked questions about student loan debt to give you the answers you seek in one place below.

What types of student loans are available for college expenses?

You can break student loans down into three broad categories. There may be Federal Pell Grants available, but you can borrow from the government if you don’t qualify. Your choices are Direct Stafford loans, Perkins loans, or PLUS loans. Direct Stafford loans come in Subsidized and Unsubsidized forms, Perkins loans are for students in great financial need, and PLUS loans are for a college student’s parents to apply for to help fund their education.

What is the FAFSA?

student loan debts fafsa

FAFSA stands for the Free Application for Federal Student Aid. This application determines whether you can get grants you don’t have to pay back. It’ll also determine your eligibility for student loans through one of the three programs we mentioned earlier. You have to report all of your income and your parent’s income on the application, and they assign grants and loan amounts based on need.

Can you invest your excess student loan funds?

According to Best Student Loans, it depends on the type of loan you get whether or not you can legally invest your student loan funds. If you have private student loans, there aren’t many restrictions attached to them. However, investing any excess funds from a subsidized federal government loan could require you to face legal action or pay subsidized interest on the amount you invested.

Is it possible to cancel your loans when you’re in school?

Yes. You can cancel your loans even after you signed the promissory note. You can cancel a Stafford Loan, Perkins Loan, or a PLUS Loan if you tell your school that you won’t accept the loan payment within 14 days of your school telling you the lender disbursed your loan. If it’s later, you can wait until the first day of the payment period and still cancel it. You can return the funds to the school and refuse them as well.

What repayment plans are available?

student loan repayment

If you want to make your payments more affordable, you have several repayment options available. Keep in mind that you will end up paying more in interest the longer you repay your loans. We listed the repayment options below.

  • Standard – You’ll pay a fixed amount every month for 10 years.
  • Extended – You’ll pay a fixed amount every month for 25 years.
  • Income-Based – You’ll pay a monthly payment amount capped at your income level and family size.
  • Graduated – You’ll pay smaller payments to start with, and they’ll gradually increase to standard payments over time.
  • Consolidation – You can consolidate your PLUS, Perkins, and Federal loans into a single loan with a fixed interest rate.

What is Public Service Loan Forgiveness?

Under this program, you’ll make 120 qualifying payments using a qualifying repayment plan. You also have to work full-time for a qualifying employer and submit proof that you stayed employed with them throughout the payment process. When you make it to the 120 payments under these conditions, the government will forgive whatever balance you have left. If you miss a single payment, it starts over. Also, the IRS can tax you on any balance the government forgives. You can find out more by clicking here.

How do you find out which type of government loan you have?

Student loan debts can easily blur together, and it can be challenging to find out which type of government loan you have. However, the National Student Loan Data System on Studentaid.gov will tell you who holds your loans with your contact information.

What happens if you can’t make your payments?

If you’re struggling to pay your student loans, you can apply for deferment or forbearance for one year at a time. If you defer your loans, it freezes everything for a year. Forbearance also freezes your payments, but your interest still adds to your balance each month. You should contact your loan servicer and see which one they suggest.

Can student loans get canceled?

There are a few circumstances where the government could cancel your student loans. They include the borrower’s death, permanent or total disability based on a condition you didn’t have when you took out the loans, the school closed while you were going or 90 days after you withdrew, and false certification. False certification is where the school signed your name on a promissory note without your knowledge.

Does declaring bankruptcy means the government discharges your loans?

Rarely. For this to happen, the bankruptcy court has to believe that keeping your student loans would cause undue hardship. This is very rare, and you could still have loans in default after you declare bankruptcy.

What is loan rehabilitation?

Once you default on a student loan, the lender will give you one chance to rehabilitate it. You’ll have to make nine consecutive monthly payments that are affordable and reasonable to you. Once you do, the lender will put your loan back in good standing and remove it from the default status.

When do you start paying back your student loan debts?

You’ll start to repay your student loans after you drop below half time status or finish your schooling. Perkins loans have a nine-month grace period before you have to pay, and Stafford loans have a six-month grace period. Your loan lender will send you monthly payment notifications when your grace period ends. For PLUS loans, you start repaying it 60 days after the disbursement date, even if you’re in school. You must make each payment in full by the due date. The only exceptions are if you made a deal with the lender or signed up for forbearance or deferment.

The post 12 Frequently Asked Questions About Student Loan Debts appeared first on Dumb Little Man.

How To Have A Growth Mindset About Money

More than 75% of Americans have at least one financial regret, and is it any wonder? We’re taught from a young age that talking about money is taboo, and the result is that throughout most of adulthood we have no actual idea how to deal with our finances. People are stuck living paycheck to paycheck, not saving enough for retirement and emergencies, and the result is always catastrophic. Debt continues to grow, and we rely on credit cards to get us through the tough times. But what if there were a better way to handle our finances and make small changes that will add up in the long run? If you can apply a growth mindset to your finances, you might find yourself in a better financial situation sooner than you think.

Money Troubles Abound

having growth mindset to your finances

With our economy in a free fall, there has never been a more relevant time to talk about money troubles. Whether you’ve lost a job or you’re just unsure of the future, the way you spend and save now could impact your life for years to come.

As of this year, American consumers owed more than $14.15 trillion in household debt. This is everything from mortgages to credit card balances to student loan balances, and it adds up quickly. In student loan debt alone, Americans owe more than $1.64 trillion. Credit card debt has skyrocketed to an all-time high of $1 trillion. Americans just aren’t prepared for everyday life.

Part of the problem is that wages have stagnated while the cost of living has ballooned out of control. For decades raises have barely kept up with inflation, while the cost of living has overshot normal wages by a significant amount.

Most Americans have decided that college is the only way to beat the system, but that often leaves them with a crippling debt load they later find they can’t afford as they try to juggle paying rising rents, minimum student loan payments, and healthcare premiums. This, in turn, has sent an entire generation back to their parents’ basements to try to regroup, which further exacerbates the economic situation. For those who are unfortunate enough to have any sort of medical needs, making ends meet is just not a financial possibility in many cases.

Currently, a third of Americans are living paycheck to paycheck, while even three in every ten low-wage earners are able to save at least some of their money but don’t. Student loan borrowers often find themselves regretting choosing a more expensive college than they needed, and 42% make at least one late payment a year. 35% of credit card users only pay the minimum amount instead of paying the full balance every cycle.

Applying A Growth Mindset To Your Finances

how to have growth mindset to your finances

Most people apply a fixed mindset to their financial situation – they feel they are helpless to change it, that they know all there is to know about their finances, and that challenges can only lead to failure or financial ruin. When you instead start to apply a growth mindset to your financial situation you realize there’s a lot you don’t know about finances and that you have plenty of room to learn and grow. Setbacks become opportunities for growth.

Financial mistakes and problems happen, and it’s your responsibility to learn from them and do better next time. Start by listing all your debts and their corresponding interest rates. There are a couple of things you can do here. The snowball method is probably the easiest – start by concentrating on paying off the smallest debt first. Keep paying minimum payments on all your debts so you don’t go into default, but find extra money each month to go toward your smallest debt. Once that one is out of the way, apply all that money to your next smallest debt until it is paid off, and keep going from there. Before long you will be debt-free and have the ability to focus your attention on other aspects of your financial life.

There are tons of apps out there that can help you keep track of your finances and expenses and make cuts wherever you can. Saving is also going to be a major component of your financial strategy, as emergency savings prevent you from having to go into debt in the first place.

Learn more about having a financial growth mindset from the infographic below.

Growth Mindset
Source: Money Hacker

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7 Ways to Splurge Money Wisely

Yes, you read that right!

Splurging – a word so decadent that just the thought of it is followed by strong guilt.

When you are brought up in a middle class household, the money mindset you have picked up – whether consciously or unconsciously – forbids you to think of splurging.

You will be looked down upon, judged, frowned on and lectured if you even think of extravagance.

But that doesn’t have to be the case.

We all have our guilty pleasures – the ones where the cost doesn’t seem to matter. Comic books, shoes, clothes, perfumes, pens, alcohol, watches, knife set, desserts, markers, belts, purses, socks, jewelry, art, memorabilia – the list is endless.

If splurging is making you unhappy or guilty, you are probably doing it wrong. When done wisely, splurging improves our relationship with money. Intelligent splurging is all about being aware of what’s most important to you and your happiness.

For example – I never feel bad when I spend thousands on buying books. There is no guilt about spending money eating healthy or paying for a gym membership/personal trainer. Of course, there is a ceiling based on what I earn – because let’s be honest, if I cannot afford it, it will be followed by guilt.

Here are some ways you can splurge money wisely.

Instruments Of Your Trade

spending money wisely

One right way to splurge is on the tools you need for work. If buying two LED monitors helps you with your productivity, then don’t hold back. If you are going to be working from home, then it is better to invest in a good ergonomic chair and a 2-in-1 standing desk, to allow you the flexibility of standing and working. If you are an athlete, splurging wisely on tools of your trade will mean buying good equipment you need for the sport you are an athlete in.

More than once, I have regretted buying cheap earphones and pinching dollars on a laptop, only to regret it later. Not investing in a comfortable chair, when my work involved sitting and working proved more costly for my back.

Wherever you can, try and go for quality because these are tools you will use on a daily basis and probably even multiple times in a single day!

Necessities Of Your Life

Splurging on necessities that you can use in the long run saves you a lot of frustration and time. Buying a good pair of knives or proper machines to help you in the kitchen can be a huge time saver and enhance the taste of your food.

Similarly, investing in a good mattress is like investing in your quality of sleep. Good sleep, on most days, is the difference between a good or a bad day.

The stuff you consider a necessity is the stuff you use a lot and regularly so might as well buy a durable one which can stand the test of time.

Celebrating Milestones

Milestones are important. Celebrating adds a special zest which makes them memorable. And making them memorable often has a cost attached to it.

As the days pass by, you will not remember what it cost but you will surely remember the memories that the day brings, which makes splurging on them a very wise decision.

The ones you remember are the ones you celebrated, so splurge on those celebrations a bit without feeling guilty about it.

Health

I want you to look back to the times you were sick. How well did you perform? How much work were you able to get done? Let me guess – not much!

A healthy brain and a healthy body are your two most important assets. For you to go out and achieve your dreams, you need to have a brain that can think and a body which is healthy and free of diseases.

Sickness is inevitable but splurging on our health – gym memberships, personal training, diet, medical tests – will ensure we minimize such days. It will enable us to be in top shape when opportunity arrives at our door and, in the long run, will pay off manifolds.

Thoughtful Gifts

way of spending money wisely

I love this one because I have firsthand seen the effects of this! The delight on the face of the recipient is priceless and it gives both of us memories of a lifetime!

Research shows that an unexpected present or being surprised is a real booster for people. This is equivalent to you finding a thank you note left on your desk by some grateful colleague or you discovering some money in pockets of an old pair of pants!

More importantly, these are the moments and the stories people tell wherever they go.
One example of this – a friend I know loves using planners. I feel they are a waste of money. Yet, I ended up spending a considerable amount to buy her a planner she had been eyeing! And it’s been worth every penny!

Buying back time

You already know your time on this earth is limited so why not buy back some of it?

We all have our nagging task list – a leaky tap, a lawn which needs landscaping, roof full of dead leaves, an AC that needs to be serviced. How much of it can you really keep up with? Most of the time, it is not about the money but about your mental health. If money can help ease the stress by having someone take care of something for you, what is the harm?

If you can afford it, pay the extra couple of hundred dollars so you can take a direct flight and spend the night in your own bed. Paying someone to cook and clean in the house means you get a couple of hours in a day back – time which can be spent catching up with a loved one or strengthening existing relationships or just catching up on your nagging tasks – which let’s be honest – you wouldn’t otherwise have time for.

Not living like a CEO when you are a sandwich artist

To splurge wisely, you have to do it within your budget and frequently. As Sophia Amoruso, founder and CEO of GirlBoss says,

“You cannot live like a CEO if you are a sandwich artist!”

The key is modesty – doing it in limited quantity and under the umbrella of your income. Splurge small and frequently. You get to decide what it means to you.

The people who are happy with their mansions and luxury cars are the people who can actually afford them. Going into heavy debt to splurge is exactly how not to do it!

Even when you splurge on the stuff mentioned above, you have to do it keeping in mind your income. In college, I spent 4 years with a cheap netbook just because it is all I could afford. Until I got my first paycheck, I slept on an air mattress and when I finally bought one, it was a spring mattress for $80 because I still couldn’t afford a mattress costing thousands.

Splurge lavishly and cut ruthlessly.

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5 Retirement Planning Myths Busted (To Help You Plan Your Finances Better)

When it comes to financial myths related to retirement planning, there exists plenty. Thankfully, younger citizens are becoming more conscious by the day and are opening up to embracing less conventional financing options. However, even the most well-informed people can sometimes fall prey to some of the existing retirement planning myths. It’s high time we reboot our thinking process and break free from such shortsighted ideas today.

Here are 5 retirement planning myths that we really need to abolish as fast as possible.

Myth 1: There’s plenty of time to start retirement planning later

retirement plan

One of the biggest mistakes that you can commit is to procrastinate retirement planning. When someone in their 20s starts their career as a fresher, low income makes them think that it’s not feasible to start investing in retirement planning just now.

Well, this is probably the biggest mistake in your financial planning. People tend to think that when they start earning more at a later stage of life, it will be easier to spare money for investing in retirement plans. But they tend to forget that as they grow older, so do their responsibilities and expenditure. In short, it doesn’t get easier to start saving at a later stage of life.

Another important factor to consider here is that the later you start investing in your retirement plans, the more monthly investment you need to reach your target. It is easier to save $1000/month for 35 years than to save $3000/month for 15 years (and don’t forget about the amount of interest you’ll gain for the extra 20 years of investment).

Myth 2: I’ll inherit a lot of money from my parents/relatives

You might have rich parents or close relatives, but that does not secure your future as much as you think.

Firstly, you do not know when you will be able to inherit. It’s pretty possible that you are in your late sixties and they are still thriving and enjoying the fruits of their lifelong labor well into their nineties. In that case, you will not get any immediate benefit from their wealth.

Secondly, when they are not around anymore and you do inherit their property, you can never be sure of the amount. If your parents have lived throughout their eighties and their nineties, it’s pretty much possible that they have spent the major portion of their wealth on themselves owing to their luxury lifestyle, charities and other responsibilities, or even their medical expenditure.

In short, until you get your hands on it, you can never know how much you are going to get from inheritance. In any case, it’s not very prudent to depend on it and abandon saving up for yourself.

Myth 3: My monthly expenditure will decrease

Contrary to popular belief, your monthly expenditure will not decrease as much as you think. Many people tend to think that they will only need 50%-60% of their current income after retirement. But, unfortunately, that’s not true. Rather, your income will stop but your expenditure will remain almost the same. Vacations with family, joining a club, and attending social events are some of the few things that will require plenty of money.

And unless you have a solid health insurance plan, the skyrocketing medical costs will take another big chunk of your savings.

Myth 4: I won’t live much longer after retirement

This was true once, but not anymore. In the past, human lifespan used to be only 70-75 years, but with the blessings of modern medical sciences, it has significantly improved. A person with a healthy and active lifestyle can expect to live well into their late eighties to the early nineties. So, you need solid financial planning for at least 20-25 years of your life after retirement.

Myth 5: My spouse will take care of it

retirement savings plan

Depending on your spouse for post-retirement financial planning is not the best idea in the world. We don’t want to sound too negative, but of course, there are practical factors to keep in mind.

Firstly, things can go wrong in your relationship and you might end up being divorced.

If we still overlook the chances of that happening and believe you are going to live together happily ever after, there are still factors to consider. Most retirement plans work in a way that, if your spouse only covers himself/herself in their retirement policy, it will yield better payoff. But if they are opting for joint benefits, they will have to pay a lot more premium and the payoff will be lesser.

That’s why it’s a good idea to have individual investments for your spouse and yourself rather than opting for joint plans.

So, now we’ve busted the 5 biggest myths around retirement planning. We hope you make better decisions after reading this.

The post 5 Retirement Planning Myths Busted (To Help You Plan Your Finances Better) appeared first on Dumb Little Man.

9 Frugal Tips for Families to Save Money

Family is an integral part of any person’s life. When we live with our families, it’s either we’re dependent on somebody or somebody is dependent on us. Many conflicts arise in a family due to improper finance management. When you have a family, you might often come across situations where you might feel there is never enough money to go around that saving is completely overlooked.

However, saving money helps in stabilizing your family’s financial life. It is putting aside money for more important goals. This requires discipline, which includes steering clear of whims and splurges. Thus, maintaining a frugal life can help you enjoy your life, only focusing on what’s more important for you and your loved ones. By knowing what and how to prioritize, it’s easier to set aside some extra money.

What is frugal living? For some people, it might seem like they are compromising the way they are living to save. But that’s not what it is. You can enjoy your life while practicing some frugal tips to help you achieve your money goals, too. Frugal living is nothing but being conscious with your money and how you spend it.

It suggests prioritizing the most important things and spending on them while keeping a track and reducing unnecessary, unimportant spending. Frugal life suggests balance. It doesn’t mean you’re cheap, it only means you know how to enjoy your family life while being secure with your savings.

There are many benefits to a frugal lifestyle which include fewer stress levels, more money to spend on things that are important to you and your family, and increased appreciation for living life in simplicity. Moreover, being frugal frees up more money for other activities like travel and other goals you have with your family.

Here are 9 tips for activities which can help you be more frugal in your everyday life, so you can enjoy the most of it with your family:

A treasure hunt

On a nice summer afternoon, when you’ve had your lunch and everyone is home, you can arrange a treasure hunt and invest time playing with the kids. Set up an exciting treasure hunt, think about some clues, build your maps and the gift prize for the winner. You can do it indoors, too, in case the weather is not permitting. It will not cost you anything, plus you will spend a crisp afternoon seeing your kids happy and you will get to spend precious time with your family.

Spend some time in your garden and practice gardening

When the spring is in the air, and your garden is coming back to its greenery, get your kids involved and get their help in clearing away all the dead leaves, the dirt and debris and raking up all the dead foliage outside. Plant new trees or flowers; create a bird feeder, or even a birds nest or bird-box for some lovely visitors to make themselves comfortable. This can teach your kids a lot about gardening and the beauty of nature. The feel of fresh air and the fun of watering the plants with a sprinkler or pipe will brighten their day in a way television or phone screens could never do.

Go for a walk

frugal tips

You might face some grumbles from your kids when you suggest walking; however, try to go for an evening stroll with your family. Walk to a nearby park, or lake or someplace nice and watch a sunset. Or discover a lovely spot nearby and take a picnic for the afternoon. As long as there is fun in the activity you do, kids protesting won’t be a problem. Spot different birds, spot flowers, go fishing, and enjoy the fresh air and beauty of everything around.

Head to the Library

Libraries are underrated in today’s world. But the real treasure lies in these libraries. The trove of books, the excitement of finding the book you are looking for, the silence and smell of old books make the air more exciting and can help you do a lot of productive reading. Spend an hour, sit in the library and read. The kids can choose the books they can take home and check out the activities going on. Check out ongoing or upcoming local events and make an effort to attend those. From puppet shows to local concerts and guests readings to writing classes for kids and adults, spend more time enjoying these local amenities.

Visit local museums and theater

The local places of interest have free admissions or discount rates on tickets once in a while. Thus, you can save money and entertain kids at the same time. Check out local museums and check for upcoming workshops or some shows in your local theater.

A movie afternoon

If you are stuck indoors on a rainy day, make the best out of it. A movie afternoon could be all that you need. It is a wonderful way to spend some time indoors with your family. Let your loved one pick up their favorite movie. Make popcorn and coffee or some snacks you love. Throw in a blanket on your couch and set up the atmosphere you can enjoy a movie in.

See Also: How to Access Your Favorite TV Show or Movie from Anywhere

Learn something new

frugal tips for family

Spend a day researching and gaining knowledge about the things you or your kids love. All you need to do is an internet connection and a printer, which is completely optional in case you need prints.

De-clutter

Spend some time tidying your rooms and helping your kids tidy their rooms. Try arranging your furniture differently and give your home a new outlook. Gather old toys, clothes, and books and donate it to needy.

Go to the park

Time spent at a local park is indeed enjoyable. It keeps your kids entertained by playing on swing sets, climbing frames, etc. Your kids will have fun and it is completely free, not to mention you get to spend wonderful time with your family.

The post 9 Frugal Tips for Families to Save Money appeared first on Dumb Little Man.

Start Your Coin Collection With These Rare Coins

Rare coins can add beauty and value to any collection. It is a piece of history that any man or woman hold in their hand. It could belong to an ancient era and certain empires such as the Romanian world or maybe it’s a silver dollar that pioneered in the wild east. Coin collectors are bailiffs of these treasures of the world, which can also be turned into an investment.

Any collector chooses the coins based on the artistic beauty of the design, their popularity in the market, and their potential to increase in value over time. You can find an assortment of coins when beginning with the collection; however, as you advance your collection, more coins will become a part of your collection.

Here are some coins which you can add to your collection.

Lincoln Cent

rare coins to collect lincoln cent 1909
Via usacoinbook.com

The United States, in 1909, changed the design of the one-cent coin removing the Indian head to a design that commemorates the hundredth anniversary of President Abraham Lincoln. The coin was a success among the people. Some numismatists argue that the Lincoln cent is one of the most popular U.S. coins. Many beginners start by collecting Lincoln cents.

Ancient Coins

Many numismatists are passionate about collecting ancient coins for sale, mostly the ones belonging to the ancient Romans and Greeks, as well as those from the medieval times and empires. This was when the currency began. They are mostly unique and can become a challenge to find. Not only are they extremely rare, but they can be a solid investment as well.

Peace Dollar

rare coins to collect peace dollar
Via wikipedia.org

Anthony DeFrancisci designed the peace silver dollar in 1921. The idea was to commemorate the peace after the Great War. The design emblematic of liberty on the obverse of the coin and the American eagle on the reverse was the peace symbolized on the coin. It is rare as the peace of the world did not last for a long time.

Double die Lincoln cent

Another coin that is popular for its rarity among the Lincoln coins collector. Although it is considered as an error coin, it is rare and is highly valued among collectors. The tale of the error began with the mints that received two impressions that were slightly offset from each other. Mint workers discovered the error when 20,000 or more coins were minted and mixed with the other coins.

Three-Legged Buffalo

rare coins to collect three legged buffalo
Via coinweek.com

Another error coin that became extremely popular among collectors is the three-legged buffalo coin. Given the time and cost to produce the coin dies, many dies were polished and grounded to extend their life for minting, which removed the details of the front leg of the buffalo on the reverse of the coin. The coin in the past didn’t receive the popularity like the double die Lincoln coin, but today only the collectors with deep enough pockets can afford them.

The Washington Quarter

Intended for the commemoration of the 200th birth anniversary of George Washington, it was adopted in the year 1932 and is still used in recent times.

See Also: The True Value of The 11 Coins From Around The World

The post Start Your Coin Collection With These Rare Coins appeared first on Dumb Little Man.

How to Earn Extra Income from Real Estate Without Buying Property

Making money in real estate doesn’t necessarily equate to buying and owning a second home. There are many ways in which you can start earning additional income with a very small initial capital. Here are the 5 best strategies to make money from real estate without buying a property.

Rent Out Your Home During the Holidays

One of the easiest and most straightforward ways to make money with real estate is to become a short-term rental host. The establishment of Airbnb.com in 2008 turned homesharing into an entire industry. Nowadays, there are dozens of homesharing platforms which allow regular people to list rooms or entire homes for renting on a daily basis. Some of these platforms include HomeAway, VRBO, Booking.com, and, of course, Airbnb itself.

This means that you can list your home as a short-term rental for the duration of your holidays. Instead of worrying about the safety of your property while you are away, you get to make money from it. Furthermore, you don’t need to spend almost any money to implement this strategy. Your home is already furnished with all items necessary for a comfortable stay.

Becoming a host is really easy. All you have to do is to read through the terms of a few homesharing platforms and choose the best option for your particular case. As a beginner, you should select a website which charges fees based on actual bookings rather than listings. Then, you need to create an account, list your space with an attractive description and appealing photos, and start hosting.

Before you decide to become an Airbnb-style host, make sure to check the local laws with regards to the short-term rental industry. Many major markets have adopted strict rules and regulations in an attempt to control the spread of the vacation rental industry. You might need to obtain certain permits and pay taxes in order to operate legally.

See Also: 8 Smart Tips for an Amazing Short-Term Rental Experience

Rent Out a Room Traditionally

make passive income in real estate

Airbnb is not the only way to make money from your home. If you have an extra room or two, you can rent them out on a long-term basis. This strategy is particularly good and profitable in college towns and busy cities with high rental rates. In these locations, students and recent graduates are looking for affordable renting options, so they will be attracted to your space.

An important benefit of this strategy is that you don’t need almost any initial capital to get started. The only money you might need to spend include those for buying some basic furniture in case your space is not ready for a full-time tenant. When choosing the furniture, go for durable items which will last for years rather than pretty pieces of questionable quality.

If you decide in favor of this way of making money with real estate, remember to set up a very detailed screening process. You are choosing not only a tenant but also a roommate. Ask for recommendations from employers, previous landlords, and even flatmates. Check the applicants’ credit history. Meanwhile, make sure that you don’t discriminate against candidates as that’s illegal.

Go for Real Estate Crowdfunding

You don’t have to let outsiders into your home in order to earn extra income from real estate without buying a property. Another strategy which has gained a lot of attention in recent years is real estate crowdfunding. This is just a fancy name for a relatively straightforward concept. What crowdfunding real estate property entails is investing money in large real estate projects with other regular people like you from all around the globe.

Fundrise, founded in 2010, was the first real estate crowdfunding platform. Its success inspired the establishment of many others, including Realty Mogul, RealtyShares, and RealCrowd. The best thing about this strategy is that you can get started with as little as $500. Crowdfunding has two other important benefits when compared to buying an investment property.

First of all, it requires zero knowledge and experience in the real estate business. All you have to do is to conduct some online research and choose the best platform. You don’t have to worry about selecting a profitable market, buying a positive cash flow property, or managing a rental. Second, this is a passive real estate investing strategy. Once you’ve chosen through which website to invest, you will start receiving dividends without doing any actual work.

Invest in REITs

Another way to make money from real estate – both in the short and long term – is to buy shares in real estate investment trusts (REITs). Actually, REITs are the traditional form of real estate crowdfunding, which are also known as eREITs.

Investing in REITs is very similar to investing in stocks. You buy shares in entities that own, manage, and finance income-generating real estate assets. With this strategy, even small individual investors can get access to enormous projects worth millions of dollars. Through REITs, you make money in the short run in the form of dividends, as well as in the long term in the form of capital gains.

However, before deciding to go for this strategy, you should know that conventional REITs have significantly larger expectations in terms of initial capital than real estate crowdfunding platforms. Most trusts require a minimum investment of a few thousand dollars. If you can afford this, then REITs are a true source of passive income from real estate.

Get a Real Estate License

making passive income in real estate

The last way to make money in real estate without buying an investment property is to get a real estate license. In simple words, this means to become a licensed real estate agent.

Whereas being an agent is not a source of passive income, it is definitely a great way to boost your income. Being a part-time real estate agent is absolutely feasible as many homebuyers and sellers prefer to visit properties for sale in the evening or during the weekend.

A major benefit of buying and selling homes is that you will become an expert on the real estate industry and the local housing market. If you realize that you really enjoy real estate, the transition to an investor who owns actual income properties is as easy as it gets. Not to mention the commission you get from each transaction.

See Also: How to Develop Property Listings that Make Purchasers Take Action

With real estate the sky is the limit. You can earn additional income without ever buying and owning an investment property. Just try one of these 5 best strategies.

The post How to Earn Extra Income from Real Estate Without Buying Property appeared first on Dumb Little Man.

‘A perfect storm for first time managers,’ say VCs with their own shops

Until very recently, it had begun to seem like anyone with a thick enough checkbook and some key contacts in the startup world could not only fund companies as an angel investor but even put himself or herself in business as a fund manager.

It helped that the world of venture fundamentally changed and opened up as information about its inner workings flowed more freely. It didn’t hurt, either, that many billions of dollars poured into Silicon Valley from outfits and individuals around the globe who sought out stakes in fast-growing, privately held companies — and who needed help in securing those positions.

Of course, it’s never really been as easy or straightforward as it looks from the outside. While the last decade has seen many new fund managers pick up traction, much of the capital flooding into the industry has accrued to a small number of more established players that have grown exponentially in terms of assets under management. In fact, talk with anyone who has raised a first-time fund and you’re likely to hear that the fundraising process is neither glamorous nor lucrative and that it’s paved with very short phone conversations. And that’s in a bull market.

What happens in what’s suddenly among the worst economic environments the world has seen? First and foremost, managers who’ve struck out on their own suggest putting any plans on the back burner. “I would love to be positive, and I’m an optimist, but I would have to say that now is probably one of the toughest times” to get a fund off the ground, says Aydin Senkut, who founded the firm Felicis Ventures in 2006 and just closed its seventh fund.

“It’s a perfect storm for first-time managers,” adds Charles Hudson, who launched his own venture shop, Precursor Ventures, in 2015.

Hitting pause doesn’t mean giving up, suggests Eva Ho, cofounder of the three-year-old, seed-stage L.A.-based outfit Fika Ventures, which last year closed its second fund with $76 million. She says not to get “too dismayed” by the challenges.

Still, it’s good to understand what a first-time manager is up against right now, and what can be learned more broadly about how to proceed when the time is right.

Know it’s hard, even in the best times

As a starting point, it’s good to recognize that it’s far harder to assemble a first fund than anyone who hasn’t done it might imagine.

Hudson knew he wanted to leave his last job as a general partner with SoftTech VC when the firm — since renamed Uncork Capital — amassed enough capital that it no longer made sense for it to issue very small checks to nascent startups. “I remember feeling like, Gosh, I’ve reached a point where the business model for our fund is getting in the way of me investing in the kind of companies that naturally speak to me,” which is largely pre-product startups.

Hudson suggests he miscalculated when it came to approaching investors with his initial idea to create a single GP fund that largely backs ideas that are too early for other VCs. “We had a pretty big LP based [at SoftTech] but what I didn’t realize is the LP base that’s interested in someone who is on fund three or four is very different than the LP base that’s interested in backing a brand new manager.”

Hudson says he spent a “bunch of time talking to fund of funds, university endowments — people who were just not right for me until someone pulled me aside and just said, ‘Hey, you’re talking to the wrong people. You need to find some family offices. You need to find some friends of Charles. You need to find people who are going to back you because they think this is a good idea and who aren’t quite so orthodox in terms of what they want to see in terms partner composition and all that.’”

Collectively, it took “300 to 400 LP conversations” and two years to close his first fund with $15 million. (It’s now raising its third pre-seed fund).

Ho says it took less time for Fika to close its first fund but that she and her partners talked with 600 people in order to close their $41 million debut effort, adding that she felt like a “used car salesman” by the end of the process.

Part of the challenge was her network, she says. “I wasn’t connected to a lot of high-net-worth individuals or endowments or foundations. That was a whole network that was new to me, and they didn’t know who the heck I was, so there’s a lot of proving to do.” A proof-of-concept fund instilled confidence in some of these investors, though Ho notes you have to be able to live off its economics, which can be miserly.

She also says that as someone who’d worked at Google and helped found the location data company Factual, she underestimated the work involved in running a small fund. “I thought, ‘Well, I’ve started these companies and run these big teams. How how different could it be?” But “learning the motions and learning what it’s really like to run the funds and to administer a fund and all responsibilities and liabilities that come with it . . . it made me really stop and think, ‘Do I want to do this for 20 to 30 years, and if so, what’s the team I want to do it with?’”

Investors will offer you funky deals; avoid these if you can

First-time managers often look to close on a big anchor investor as a positive indicator to other backers, and some LPs will take advantage of their real or perceived desperation to lock something down. Yet seizing certain opportunities can actually send the wrong signal, depending on the scenario.

In Hudson’s case, an LP offered him two options: either a typical LP agreement wherein the outfit would write a small check, or an option wherein it would make a “significant investment that would have been 40% of our first fund,” says Hudson.

Unsurprisingly, the latter offer came with a lot of strings. Namely, the LP said it wanted to have a “deeper relationship” with Hudson, which he took to mean it wanted a share of Precursor’s profits beyond what it would receive as a typical investor in the fund.

“It was very hard to say no to that deal, because I didn’t get close to raising the amount of money that I would have gotten if I’d said yes for another year,” says Hudson. He still thinks it was the right move, however. “I was just like, how do I have a conversation with any other LP about this in the future if I’ve already made the decision to give this away?”

Fika similarly received an offer that would have made up 25 percent of the outfit’s debut fund, but the investor wanted a piece of the management company. It was “really hard to turn down because we had nothing else,” recalls Ho. But she says that other funds Fika was talking with made the decision simpler. “They were like, ‘If you sign on to those terms, we’re out.” The team decided that taking a shortcut that could damage them longer term wasn’t worth it.

Your LPs have questions, but you should question LPs, too

More so than most first-time managers, Senkut started off with certain financial advantages, having been the first product manager at Google and enjoying the fruits of its IPO before leaving the outfit in 2005 along with many other Googleaires, as they were dubbed at the time.

It allowed him to start putting money to work immediately. Still, as he tells it, it was “not a friendly time a decade ago” to raise outside capital, with most solo general partners spinning out of other venture funds —  not search engines. As an outsider, to crack into the venture industry, he largely tried to shadow angel investor Ron Conway, working checks into some of the same deals that Conway was backing.

“If you want to get into the movie industry, you need to be in hit movies,” says Senkut. “If you want to get into the investing industry, you need to be in hits. And the best way to get into hits is to say, ‘Okay. Who has an extraordinary number of hits, who’s likely getting the best deal flow,’ because the more successful you are, the better companies you’re going to see, the better the companies that find you.”

Senkut has developed an enviable track record over time, including stakes in Credit Karma, which was just gobbled up by Intuit, and Plaid, sold in January to Visa. Those kinds of exits may give him more confidence than managers earlier in their careers might muster. Still, Senkut also says it’s very important for anyone raising a fund to not just answer LPs’ questions but to also ask the right questions of them.

He says, for example, that with Felicis’s newest fund, the team asked many managers outright about how many assets they have under management, how much of those assets are dedicated to venture and private equity, and how much of their allotment to each was already taken.

Felicis did this so it doesn’t find itself in a position of making a capital call that an investor can’t meet, especially given that in recent years, many institutional investors have been writing out checks to VCs at a faster pace than ever been before and have, in many cases, too much of their capital in the venture industry at this point.

In fact, Felicis added new managers who “had room” while cutting back some existing LPs “that we respected . .. because if you ask the right questions, it becomes clear whether they’re already 20% over-allocated [to the asset class] and there’s no possible way [they are] even going to be able to invest if they want to.”

It’s smart thinking and, when the market eventually eases up again, and new funds can again capture the attention of investors, certainly something to keep in mind.

Eight Ways Entrepreneurs Can Finance their Business Ideas

Every entrepreneur or startup owner faces the biggest concern of financing their business. With minimal experience and no business background, entrepreneurs find it very hard to get the money at the initial level. Be it working capital or provision for the troubled times, you need money to run and grow your business. Let’s discuss some of the options that can help you get funding for nurturing your business ideas.

Before digging deep into the topic, it is necessary to go through two ways of financing your business — Equity and Debt. The equity option enables entrepreneurs to fund their business by providing an ownership stake to an investor. Here, there is no obligation of repayment. But then, you need to give up a part of your ownership in the business. It can also make you lose control over the company in the long run.

The debt option is like taking a loan for a specific period. You have to pay interest on the amount. Here, the ownership of your company is not at stake. But, if for some reason, you fail to repay the loan, the lender can take your company into liquidation. In such a scenario, you lose your company. The debt option is worth only when you have a strong financial backup.

Equity-based Funding

how to finance your startup idea

Self-funding- This is the safest way of funding for your startup. You can either use savings, personal debt, or both for your business. Also, you can consider selling assets like a second home or a boat to generate cash for your company.

Friends and family- This is a source of both equity and debt funding. Though this seems a handy source of funding, you need to remain cautious while assigning part of your business among friends and family members. Many businesses fail because key parts of business go into the wrong hands. Also, when the capital erodes, it hurts feelings and ruins friendships.

Angel investors and Crowdfunding- Affluent investors can bring capital in the startups. They are known as angel investors as they are always willing to invest in ideas they find lucrative in the future. Angel investors can also form a group of investors to spread risks and assist you to do extensive research. Local angels and the Chamber of Commerce are also good sources for funding your business at the initial stage.

Crowdfunding is also a concept similar to angel investors. The only difference here is that there is a large number of people or investors who contribute to your startup idea as per their wish. Crowdfunding has certain norms and its success rate is lower than that of angel investment. Crowdfunding is based either on equity, debt, or rewards. You can select the most suitable platform from hundreds of crowdfunding platforms.

Partnership- This is one of the strongest sources of funding for your business. Strategic partners can not only bring investment but also give new thoughts to take the business to the next level. Partners can also help your business by managing key processes. Let’s take the example of a property management company. A strategic partnership with a property maintenance company can help this company to provide 360-degree solutions.

Debt-related Funding

financing your startup

Lenders- Many lenders and organizations lend money to small businesses and startups. They lend money either at higher interest rates or ask for assets as security. Here, the interest rate is a bit tricky. For example, if the interest rate is 3% and the term is one month, then the actual annual interest rate is 36%. This is quite high as compared to a 3% rate.

Lenders are of two types- Traditional and Government lenders. Traditional lenders can be the first choice. Banks and credit unions are included in this type. This type of lenders, however, do not fund any innovative or experimental ideas. Government lenders work with the government arms to get more funds with some risks.

7a Loans- It is a type of loan that assists startups or businesses that have no collateral. Entrepreneurs with no personal or business assets are the most eligible candidates for this type of loan. However, a common man may not get this type of loan. What makes this loan attractive for entrepreneurs is the fact that the 7a loan has simple T&Cs. Entrepreneurs need to give a repayment guarantee of 85% to take this loan.

Banks- Both government and private banks lend SMEs and startups. But they need a track record and want to secure their loans by some of your assets. Banks are, however, not much friendly for SMEs and startups. Many entrepreneurs tend to stay away from banks at the initial stage because they have issues of both working capital and initial funding. In today’s time, banks have quickly become out of focus for entrepreneurs.

See Also: How to Get A Short-Term Business Loan

Venture Capitalists

They are basically the innovators of the business world. They’re constantly in search of entrepreneurs with lucrative ideas. If your idea is capable of working at a small level, you can easily convince a VC (Venture Capitalist) to support your business. VCs provide funds in two ways — equity or debt. Venture capitalists can lead your business to succeed at the international level.

Some venture capitalist companies invest in businesses by offering scholarships to entrepreneurs. Techpreneurs can leverage the benefits of these scholarships and become owners of small companies or startups at a young age. What’s more, your company can get money along with qualified business mentors through such venture capitalist companies. Simply put, VCs can assist you to launch your products while guiding your company at the initial level.

The SBA (Small Business Administration) is also a considerable debt option. It has many options but these options need a guarantee of repayment.

Concluding Lines

Many options are available to fund your business at the initial level. If you have a unique idea that you think it is worth investing, you can certainly explore various options and find the ideal one for your startup.

The post Eight Ways Entrepreneurs Can Finance their Business Ideas appeared first on Dumb Little Man.

How Gen Z Is Revolutionizing Our College Approach

Those in Generation Z are the youngest alive, but their advanced wisdom is considered to be ahead of their years. Today, the average teenager and young adult is all business, putting the bulk of their focus on their future.

Gen Zers are privy to a high-level of socioeconomic consciousness, such as the fact that nearly half of the American workforce is living on less than an $18,000 annual income. As their generation approaches adulthood, they’re searching for a better future than the economical climate they’re observing — and 82% consider college the most realistic way to get there.

To do so, the Gen Z population is completely reshaping how we interact with higher education. At large, students are prioritizing scholarship before work, not even showing interest in summer gigs and after-school jobs. Even though 12.6% of their generation is unemployed, Gen Z will go on to make up nearly a quarter of the American workforce by just 2028. More importantly, this is their preference. But why?

Rising student debt has made Gen Z reluctant toward higher education. This isn’t to say our youngest generation isn’t attending college, because this isn’t the case. Instead, students are taking more strategic approaches in the ways they choose which college to attend and the financial packages they receive. Most just want the assurance they’ll get their money’s – and degree’s – worth before enrolling into a specific university.

gen z college

This is why we’re seeing more K-12 students grow interest in their education. I bet you never thought you’d see a statistic telling you that students are obsessed with learning. Spending almost one hour more per week than within the years of 2005-2009, the average

Gen Z student spends 6.48 hours per week on homework. The number of students engaging in volunteer work has also grown. In fact, it has doubled since 1985-1989, as the average student dedicates 2.66 hours per week to volunteer work.

See Also: Why Volunteering Is Important In Getting Your First Job

Furthermore, nearly half of Generation Z high school students have already earned transferable college credits. This is just another example of how today’s youngest generation is ahead of the game. To put it numerically, 74.8% of 2015’s high school students had earned college credit before completing their K-12 career. In 1985, this number was significantly less — only 58.7% of students achieved this. However, the availability for dual-credit courses was not at the level it is today.

college and gen z

Upon entering college, the generation’s ambition still seems to grow strong. Today, fewer college students than ever are working while in school. Why so? To Gen Zers, education trumps all. However, some do work — they’re just working less.

From 2010-2016, college students worked an average of 6.66 hours per week. During 1985-1989, this number was dramatically higher, and the average college student worked 11.26 hours per week. To put these numbers in another form, 57% of college students held a job from 2010-2016. In 1985-1989, 74% of college students held employment.

Now let’s relate this to national employment.

In December 2019, 145,000 new jobs were created in the U.S. The following month, unemployment fell to 3.5%, which was down from the 3.9% unemployment rate the following year. For those aged 20+, the unemployment rate is even lower. Women older than 20-years-old fall into an unemployment rate of 3.2%, men: 3.1%. Interestingly enough, only 0.7% of Americans have been without work for more than six months.

Still, unemployment numbers don’t describe the entire dynamic of America’s future job market that Gen Z is preparing themselves for. Nearly 9 in 10 of Gen Z college graduates took their desired field’s job availability into account before selecting a major. Today, the fastest-growing American employers are within the service industry, including: retail, healthcare, and hospitality.

However, it’s not even in the interest of most Gen Z students to enter the fields they’re cushioning themselves to fall back on. 92% of Gen Z students expect to work for less than six employers throughout their lifetime. In further ambition, 60% plan to start a business someday, and 38% plan to pursue an advanced degree.

See Also: GenZ and Money: How GenZ Faces Their Financial Fears

For Gen Z, it’s all about employment. In fact, Gen Z is projected to become history’s most entrepreneurial and educated generation yet. Check out the infographic below for the complete analysis explaining how Gen Z is reshaping the college years.
How Gen Z is Reshaping the College Years
Source: Online College Plan

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Top 9 Financial Mistakes of Young Entrepreneurs You Need to Be Aware Of

Thousands of young businessmen and women start new companies in the United States each year. Most will not last. However, whether you decide to form a limited liability company or go out on your own, you can increase the odds that your business will be one of the few that makes it. Success is not a question of good genes or dumb luck; it’s usually just about being prudent. Avoid these nine common financial mistakes of young entrepreneurs.

Not Separating Personal and Business Assets

You should always keep your personal and business assets separate. Not only does this help to streamline your business operations, it also allows you to take advantage of tax deductions, such as writing off business expenses.

One way is to set up a limited liability company (LLC). There are many benefits to establishing an LLC, including the ability to safeguard your personal assets if your business loses money or in case of a lawsuit.

Racking Up Personal Credit on Business Expenses

financial mistake of young entrepreneurs

If you’re using the same credit card for your movie tickets as you are for ordering branded stationery, you need to stop. Don’t mix your personal and business spending. Business credit card issuers stipulate that you can only use these cards for business purposes anyways, so it’s best to steer clear of such practices.

Another key reason for keeping your personal and business spending separate is that putting both expenses on the same credit card jeopardizes the protections that having a limited liability company gives you. Most business expenses are tax deductible, so separating personal and business spending makes life easier during tax time.

Not Preparing for Unforeseen Circumstances

When you’re young, it’s hard to imagine difficult situations such as death and divorce. However, it’s important to make provision for unforeseen circumstances to protect your loved ones—and your business. Having a buy-sell agreement in place outlines what will happen with your shares of a business should the worst occur.

You can use a revocable living trust to decide who will get your property when you die. This can be altered as your wishes and circumstances change, but the most attractive aspect of a living trust is that it allows you to avoid probate. Probate is the legal process of handling an estate, and it can be expensive and complex.

It may not be very romantic, but if you have your own business, it’s also a good idea to sign a prenuptial agreement before you get married. This legally binding contract describes who owns what assets, and how those assets would be distributed in a divorce.

Foregoing Insurance

Insurance is a legal requirement if you have employees, but even if you are a solo operation, insurance protects you if anybody makes a claim against your business. Business Owners’ Insurance provides an income if your business is temporarily out of action due to a disaster, and covers expenses such as rent and utilities you would’ve incurred during that period.

You may be cash-strapped when you’re starting out, but not taking out insurance could become a very costly false economy.

Not Planning for Taxes

When you first launch your business, it can be tempting to focus all your energy on generating income. But have you thought about taxes?

How LLCs are taxed depends on the number of members it has, and whether you decide to treat your LLC as a different business form for tax purposes.

This checklist from the IRS will help you ensure that your new business complies with federal tax requirements. Each state has its own tax rules, too. It’s not all bad news, though: You can also take advantage of tax incentives relating to energy use and other aspects of your business.

Not Paying Yourself

financial mistakes of young entrepreneur

It’s very common for young entrepreneurs to deny themselves an income. However, you should still pay yourself the market rate for the job you’re doing as soon as the business can afford to do so. When you don’t compensate yourself, it can be hard to determine whether your business model is profitable.

Not Hiring/Speaking to an Accountant

When you are starting out, it can be tempting to try to do everything yourself. This is understandable, considering that your funds are probably limited, and your enthusiasm is unbridled. However, thinking you can be your own accountant can end up saving you money upfront, but costing you more over time. Unless you have financial training, you’re better off hiring a professional. He’ll be able to help you build a strong foundation for your business and save you money in the long term.

Expanding Too Quickly

While it may seem hard to believe, growing too quickly can sometimes be as bad as not growing at all. This is largely because rapid expansion can put too much pressure on your fledgling business, and you have neither the infrastructure nor the experience to deal with it.

The result can be customer dissatisfaction because of your inability to handle an influx of orders, employee burnout from too many long days, and even cash flow problems because you might be shelling out for inventory while customers owe you money.

Insufficient Capital

Likely the biggest mistake that young entrepreneurs make is not having enough money to fund their business properly. Either you, your partners, and/or your shareholders need to invest sufficient capital in the business to ensure its success.

If your business focuses largely on providing services (for example, copywriting or web design), you may not need much capital. However, it’s still worth remembering that the leading cause of failure for all businesses is a lack of money.

See Also: Get Your Business Running With These Business Funding Solutions

The post Top 9 Financial Mistakes of Young Entrepreneurs You Need to Be Aware Of appeared first on Dumb Little Man.

How To Choose The Right Apartment Insurance Policy

Apartment insurance is not exactly something a lot of people enjoy talking about but it is actually something which is very important and is often ignored. Apartment insurance, also known as renters insurance, covers a lot of things when you have issues with your apartment. If you don’t have this policy then you risk losing your belongings should something go wrong with no kind of compensation.

This is what makes choosing the right renters insurance policy quite tricky. Don’t worry though as we have put together some advice that can help you to make the right decision. Keep reading to find out more.

Choosing The Company

choosing the right apartment insurance policy

One of the most important things that you need to consider when picking out apartment insurance for your home is the company that you are going to buy it from. Some insurance companies put their customers first while others try to get out of paying out any kind of money when something goes wrong. It might be worth taking a closer look at the company and reading some reviews. If you know someone who is happy with their current policy, ask them for a recommendation.

Checking What Is Covered

Just like with other kinds of insurance policies, you will find that renters insurance can cover a variety of things. Some policies will cover more than others and this can be risky if you don’t read the policy carefully. Standard policies should cover personal property, personal liability and medical bills and temporary living expenses.

Within these categories, there are certain things that you will want to look for. You might want to get some extra coverage for your expensive items including electronics or jewellery.

Reading The Terms and Conditions

choose the right apartment insurance policy

When was the last time you read over the terms and conditions that came with your insurance policy? This is a big mistake that many people make when buying a policy and it can be quite risky. The terms and conditions are something which you are agreeing to when you buy a policy and sign a contract. This means that you will be held to this contract should anything happen and you need to make a claim.

Some of the terms can include exclusions that you aren’t covered for as well as deductibles. The best advice that we could give you is to spend time reading over this and make sure that you are choosing the right policy for you.

Comparing Prices

Our final tip for those who are on the hunt for a new apartment insurance policy is to make sure that you are comparing prices. Of course, you shouldn’t always just go for the cheapest option as this can sometimes indicate that the policy is not as good as you are hoping.

A good way to compare prices to compare the type of cover at the same time. A certain policy could be more expensive but it could also save you money in the long-run should something happen. Don’t forget to compare prices as this can often be key to choosing the right one for you.

Conclusion

If you are looking for a new apartment insurance policy then you should make sure that you spend some time looking for one that will cover everything that you need. Whether you are adding on extras or going for basic coverage, time spent researching should come in handy.

Follow all of the advice that we have given you in this article and this should help you to come to the right conclusion and find the best policy.

See Also: Explaining The Importance of Insurance For Renters

The post How To Choose The Right Apartment Insurance Policy appeared first on Dumb Little Man.

Did African startups raise $496M, $1B or $2B in 2019?

Five years ago, it was hard to come by any numbers for annual VC investment in Africa. These days the challenge is choosing which number to follow.

That’s the case for three venture funding studies for Africa that turned up varied results.

The numbers and variance

Investment stats released by media outlet Disrupt Africa, data-base WeeTracker and Africa focused fund Partech have left some people scratching their heads.

From high to low, Partech pegged total 2019 VC for African startups at $2 billion, compared to WeeTracker’s $1.3 billion estimate and Disrupt Africa’s $496 million.

That’s a fairly substantial spread of $1.5 billion between the assessments. The variance filtered down to country VC valuations, though it was a little less sharp.

Africa VC markets 2019Partech and WeeTracker shared the same top-three countries for 2019 VC investment in Africa — Nigeria, Kenya, and Egypt — but with hundred-million dollar differences.

Disrupt Africa came up with a different lead market for startup investment on the continent — Kenya — though its $149 million estimate for the East African country was some $500 million lower than Partech and WeeTracker’s VC leader, Nigeria.

So what accounts for the big deviations? TechCrunch spoke to each organization (and reviewed the reports) and found the contrasting stats derive from different methodologies — namely defining what constitutes a startup and an African startup.

Partech’s larger overall VC valuation for the continent comes from broader parameters for companies and quantifying investment.

“We do not limit the definition of startups by age of the incorporation or size of funds raised,” Partech General Partner Tidjane Deme told TechCrunch.

This led the fund, for example, to include Visa’s $200 million investment in Nigerian financial-services company Interswitch . The corporate round was certainly tech-related, though few would classify Interswitch — which launched in 2002, acquires companies, and has a venture fund — as a startup.

Partech’s higher annual VC value for Africa’s startups could also connect to tallying confidential investment data.

“We…collect and analyze undisclosed deals, accessing more detailed information thanks to our relationships within the ecosystem,” the fund’s report disclosed.

WeeTracker’s methodology also included data on undisclosed startup investments and opened up the count to funding sources beyond VC.

“Debt/loans, grants/awards/prizes/non-equity assistance, crowdfunding, [and] ICOs are included,” WeeTracker clarified in a methodology note.

Disrupt Africa used a more conservative approach across companies and investment. “We are a bit more narrow on what we consider a startup to be,” the site’s co-founder Tom Jackson told TechCrunch.

“In the clearest scenario, an African startup would be headquartered in Africa, founded by an African, and have Africa as its primary market,” Disrupt Africa’s report stated  — though Jackson noted all these factors don’t always align.

“Disrupt Africa tackles this issue on a case-by-case basis,” he said.

Partech was more liberal in its definition of an African startup, including investment for tech-companies that count Africa as their primary market, but not insisting they be incorporated or operate HQs on the continent.

Andela FoundersThat opened up inclusion of large 2019 rounds to Africa focused, New York headquartered tech-talent accelerator Andela and investment to Opera’s verticals, such as OPay in Nigeria.

In addition to following a more conservative definition of African startup, Disrupt Africa’s report was more particular to early-stage ventures. The site’s report primarily counted investment for companies founded within the last five year and excluded “spin-offs of corporates or any other large entity…that [has]…developed past the point of being a startup.”

Commonalities across reports

For all the differences on annual VC counts for Africa, there were some common threads across WeeTracker, Partech, and Disrupt Africa’s investment reports.

The first was the rise of Nigeria — which has Africa’s largest population and economy — as the top destination for startup VC investment on the continent.

The second was the prominence of fintech as the most funded startup sector across Africa, gaining 54% of all VC in Partech’s report and $678 million of the $1.3 billion to startups in WeeTracker’s study.

VC inequality

An unfortunate commonality in each report was the preponderance of startup investment going to English speaking Africa. No francophone country made it into the the top five in any of the three reports. Only Senegal registered on Partech’s country-list, with a small $16 million in VC in 2019.

The Dakar Angel Network launched last year to bridge the resource gap for startups in French-speaking African countries.

Final sum

There may not be a right or wrong stat for annual investment to African startups, just three reports with different methodologies that capture unique snapshots.

Partech and WeeTracker offer a broader view of multiple types of financial support going to tech companies operating in Africa. Disrupt Africa’s assessment is more specific to a standard definition of VC going to startups originating and operating in Africa.

Three reports with varying numbers on the continent’s startup investment is a definite upgrade to what was available not so long ago: little to no formal data on VC in Africa.

Cash Flow Management Tips to Improve Your Business

Cash flow management is simply a process of tracking the amount of money coming in and the amount of money going out. It helps you determine the amount of money that will be available to your business in the future. There is no business that can survive without proper cash flow management. It is an essential part of financial analysis and is an integral part of any business.

Cash flow management is especially important for startups. If the company is not able to manage its cash flow during the first year of operations, it will probably not survive during the second year. Poor management of cash flow can result in a company’s inability to pay its suppliers or finance urgent needs. Without any doubt, you can make use of a credit line.

However, when your loans and credit cards are empty, you will be left in a situation where the cash is needed.

In order to perform cash flow analysis, you will have to take three key elements into consideration and they are as follows:

  • Accounts receivable – This is the amount of money customers owe you.
  • Accounts payable – This is the amount of money you owe to suppliers.
  • Shortfalls – This refers to the situation where you owe more than what you have on liability.

You have to be able to manage all the aforementioned elements in order to lead your business to success. It is not advisable to allow a situation where your customers owe you too much or when you owe your suppliers too much. Otherwise, it can hurt your business significantly.

In order to determine the current cash flow, you will have to look at the amount of money coming in and the amount of money going out. In case you have a number of customers that owe you money and have yet to pay, make sure not to consider this as part of your cash flow.

Undoubtedly, cash flow management is vital for business. However, if there is no cash to be managed in the first place, the business is in trouble. There are, however, a number of ways to increase your cash flow and eliminate any difficulties with it.

Here are the most important cash flow management tips you can use for your business:

Calculate the break-even point.

cash flow management business tips

It is critically important to determine the break-even point for your business. In this way, you will know when your business becomes profitable and also gives an early goal to strive for.

During cash flow management, keep your focus on reaching that break-even point. This type of analysis can be done in two ways: unit-based or dollar-based. Both approaches involve fixed costs.

In order to calculate the BEP with the use of a unit-based approach, you will need to take your fixed cost. The next step would be taking your revenue per item and subtracting it from the variable cost per item.

The final step is to take the fixed cost and divide it by that number. BEP, with the use of a dollar-based approach, involves taking a fixed cost and dividing it by the contribution margin.

Consider cash flow before profits.

It might sound contradictory, but this is a reality. Even if you reach your break-even point and your business is profitable, you still need to take care of cash flow management.

The next step after reaching the BEP is making an analysis of accounts payable, accounts receivable, and shortfalls. Then, determine whether any of them possess a problem for your business.

It might also be the case that your business is able to break even but it does not have any cash left. If this is the case for you, then it is time to have a detailed look at the aforementioned elements.

It will help you to figure out whether you need to attract new customers or it would be wise to cut the expenses. Even the smallest modification can have a great impact on the profit margin and provide you with an idea of what impacts your business most.

Try to have cash reserves.

Any business has shortfalls and yours is not an exclusion. The survival of your business highly depends on the ability to manage these shortfalls. If you start your business already with some cash in your bank account, it will make your life much easier.

It would be great to have cash reserves that will help you to last for the first three to six months. In this way, you will be able to protect your business from situations where a market dives into a temporary downturn.

Focus on collecting receivables ASAP.

Customers like situations when the invoice says “due in 30 days”. Even though it is good for customers, it is not good for your business. It is recommended to state “due upon receipt” on your invoice.

You can also delegate the task of keeping an eye on receivables to your employees. He/she will be responsible for contacting your customers and collecting payments.

Extend payables ASAP.

Approach to account payables should be the opposite of account receivables. It is advised to extend payable to net 60 or net 90 if possible. It will give you a chance to have a higher cash balance and increase your debt.

Another reason for having cash reserves is your ability to pay suppliers. If you owe suppliers and do not have enough cash to make payments, you will harm the relationship with them. They might also impose additional fees. Apart from that, they can withhold the next shipment, which will interrupt the whole production process.

Carefully monitor your cash flow.

Make sure you have a professional team in the finance department. These people should be completely informed about all the company’s finances. It is also important to have a person who will be responsible for monitoring the cash flow and informing you when the company reaches a certain threshold. For example, when your cash flow hits the $1,000 mark.

Apply technology to your cash flow management.

cash flow management tip

Specialists recommend keeping your cash flow spreadsheets in the cloud. Some of these sites are DropBox and OneDrive.

By utilizing these services, you will be able to access them from anywhere. You can also make use of professional accounting software. One important detail to be mentioned is security.

Thus, when using cloud-based technology, make sure to have the best security practices in place in order to protect the data. Security should be priority number one for your business.

See Also: How Cloud Technology Can Help Your Business Grow

Project future cash flows.

Estimating future cash flows is an important element of cash flow management. This is normally done with the use of historical data and market movements. Make sure to make projections for every month, quarter, and year. Precise cash flow projections can alert you to problems before they appear.

Without any doubt, it is almost impossible to make the forecast that will match with real numbers when the time comes. However, it is possible to make a prediction that will be close to the real numbers.

Cash flow projections will give you an idea of what to expect in the future. In this way, you will be able to prepare your company for any difficulties that will come along the way.

The post Cash Flow Management Tips to Improve Your Business appeared first on Dumb Little Man.

12 Clever Ways You Can Earn Money From Your Computer Today

In today’s digital world, working from home has never been more accessible. At-home jobs are the perfect opportunity for those who have kids or those who have trouble finding employment locally. Even better, there is a huge host of different jobs you can do. All you need is a computer and a steady internet connection.

Translator

Do you speak, read, and write two or more languages? If so, translators are in high demand. Translators usually have to translate audio recordings or documents from one language to another, and you can work for yourself as a freelance translator. There are also companies that offer a huge range of remote translation services, but you may have to past a test first to prove your fluency.

Online Tutor

If you love helping people learn, an online tutor can be a fantastic job to do what you love. You can pick your subject or subjects and set your hours around your schedule. For just a few hours a day, you can make several hundred dollars within weeks or months using Studypool. This website has tutors available 24 hours a day, 7 days a week, to answer students’ questions.

Virtual Travel Agent

If you love to travel and see new places, working as a virtual travel agent or consultant is the way to go. You can work part or full time dreaming up the perfect flight plans, itineraries, and activities for your clients who want to travel. As a bonus, many virtual travel agents get steep discounts that allow them to travel anywhere in the world they want without spending a lot of money.

Online Writing or Editing

A person who has a passion for creating engaging content or has a way with words can make a living writing or editing online. The pay varies from company to company or with private clients. A lot of freelance writers are full-time, but it’s also a nice side gig to make money around your schedule. The average salary for a freelance writer in $24 per hour.

See Also: 10 Tips for Freelance Writers That Really Work

Virtual Graphic Designer

Anyone who produces their best work outside a traditional office and has an artistic flair can get into virtual graphic design. You’ll assemble typography, images, and motion graphics for clients in the digital media, published, or printed sectors. You may draft logos, labels, packaging, or advertising materials for brands. You’ll want skills in software, typography, Adobe Photoshop, web design, and technology.

Airbnb Host

Do you have a house in a desirable location? Maybe you know all the hot spots in town, and you love meeting new people. If this sounds like you, becoming a host on Airbnb is a quick way to earn extra money. You set up and manage your profile online to offer short-term rental of your home. If you love to host and keep your house clean, rent out your guest bedroom or your guest house. Just make sure your community lets you have short-term rentals.

Virtual Assistant

Highly organized people that can multitask can find steady work as virtual assistants. Dozens of companies hire virtual assistants on a contract basis to help save on employment costs. Once they hire you, you’ll help organize people’s lives. Common duties include managing calendars, replying to emails, managing social media posts, and entering data.

Transcriptionist

Anyone who needs a job with no or very little experience can break into the transcriptionist industry relatively easily. You will have to have great attention to detail and be able to type quickly. You’ll listen to audio files and type out what you hear, and many job positions only require you to have a keyboard and computer to start. Most companies let you make your own schedule, and you could find yourself transcribing everything from a college lecture to a presentation.

Website Testing

Companies need people to test their websites to ensure they’re easy to navigate and intuitive. They’ll give you instructions to follow and ask you to rate how easy it was. It usually takes around 15 minutes from start to finish, and you get paid per test you complete. However, it’s first-come, first-serve. You have to stay on top of it and register for multiple companies.

Vlogger

Do your friends and family ask how you created that wreath or how you make those perfect cookies? Maybe you create stunning makeup designs. A vlogger is someone who uses platforms like YouTube or Instagram to showcase how-to videos and video blog posts. You get money per views and sponsorships, and it can range from under $100 a month to thousands. Make sure you enroll in YouTube’s Partner Program if you choose to use this platform.

Customer Service Representative

great customer service

People who are good at talking on the phone, de-escalating situations, and have a lot of patience can excel as customer service representatives. Basically, you help people that call you find the correct product, place their order, or resolve conflicts. Big brands and hotel chains employ thousands of home-based customer service representatives, and you get a reliable schedule.

Insurance Company Representative

This job does usually requires at least six months of training before you work on your own from home. However, it can be lucrative. You can make over $100,000 annually. As a representative, you’ll help customers navigate their insurance policies. You may have to answer questions, see if a service has approval, and talk to hospitals about a patient’s coverage. You also generally have to dedicate at least four-hour blocks at a time.

Bottom Line

It’s possible to find fulfilling and challenging work from home and make money with a computer. However, you should take your time and find a job that matches your wants, needs, schedule, and desired pay. It can pay off in a big way, and you get to make a living while working without the traditional nine to five job.

See Also: 4 Biggest Challenges of Being A Freelancer (And How To Deal With Them)

The post 12 Clever Ways You Can Earn Money From Your Computer Today appeared first on Dumb Little Man.

Kleiner Perkins has already blown through much of the $600 million it raised last year

Kleiner Perkins, one of the most storied franchises in venture capital, has already invested much of the $600 million it raised last year and is now going back out to the market to raise its 19th fund, according to multiple sources.

The firm, which underwent a significant restructuring over the last two years, went on an investment tear over the course of 2019 as new partners went out to build up a new portfolio for the firm — almost of a whole cloth.

A spokesperson for KPCB declined to comment on the firm’s fundraising plans citing SEC regulations.

The quick turnaround for KPCB is indicative of a broader industry trend, which has investors pulling the trigger on term sheets for new startups in days rather than weeks.

Speaking onstage at the Upfront Summit, an event at the Rose Bowl in Pasadena, Calif. organized by the Los Angeles-based venture firm Upfront Ventures as a showcase for technology and investment talent in Southern California, venture investor Josh Kopelman spoke to the heightened pace of dealmaking at his own firm.

The founder of First Round Ventures said that the average time from first contact with a startup to drawing up a term sheet has collapsed from 90 days in 2004 to 9 days today.

Josh Kopelman of First Round Capital: we can look at every company we’ve ever funded, and learned that the time from first email/contact to term sheet has shrunk from 90 days in 2004 to just 9 today.

— Dan Primack (@danprimack) January 29, 2020

 

“This could also be due to changes in the competitive landscape … and there may be changes with First Round Capital itself,” says one investor. “It may have been once upon a time that they were looking at really early raw stuff… But, today, First Round is not really in the first round anymore. Companies are raising some angel money or Y Combinator money.”

At KPCB, the once-troubled firm has been buoyed by recent exits in companies like Beyond Meat, a deal spearheaded by the firm’s former partner Amol Deshpande (who now serves as the chief executive of Farmers Business Network) and Slack.

And its new partners are clearly angling to make names for themselves.

“KP used to be a small team doing hands-on company building. We’re moving away from being this institution with multiple products and really just focusing on early-stage venture capital,” Kleiner Perkins  partner Ilya Fushman said when the firm announced its last fund.

Kleiner Perkins partner Ilya Fushman

“We went out to market to LPs. We got a lot of interest. We were significantly oversubscribed,” Fushman said of the firm’s raise at the time.

In some ways, it’s likely the kind of rejuvenation that John Doerr was hoping for when he approached Social + Capital’s Chamath Palihapitiya about “acquiring” that upstart firm back in 2015.

At the time, as Fortune reported, Palihapitiya and the other Social + Capital partners, Ted Maidenberg and Mamoon Hamid would have become partners in the venture firm under the terms of the proposed deal.

Instead, Social + Capital walked away, the firm eventually imploded and Hamid joined Kleiner Perkins two years later.

The new Kleiner Perkins is a much more streamlined operation. Gone are the sidecar and thematic funds that were a hallmark of earlier strategies and gone too are the superstars brought in by Mary Meeker to manage Kleiner Perkins’ growth equity investments. Meeker absconded with much of that late stage investment team to form Bond — and subsequently raised hundreds of millions of dollars herself.

Those strategies have been replaced by a clutch of young investors and seasoned Kleiner veterans including Ted Schlein who has long been an expert in enterprise software and security.

“Maybe at this point they think they can raise based on the whole story about Mamoon taking over and a few years from now they won’t be able to raise on that story and will have to raise on the results,” says one investor with knowledge of the industry. “Mamoon is a pretty legit, good investor. But the legacy of the firm is going to be tough to overcome.”

All of these changes are not necessarily sitting well with limited partners.

“LPs are not really happy about what’s going on,” says one investor with knowledge of the venture space. “Everybody thinks valuations are too high since 2011 and people are thinking there’s going to be a recession. LPs think funds are coming back to market too fast and they’re being greedy and there’s not enough vintage diversification but LPs … feel almost obligated that they have to do these things… Investing in Sequoia is like that saying that you don’t get fired for buying IBM .”

Essential Tips for an Effective Budget Plan

Money makes the world go round. We work for money so we can afford a high quality of life; that’s just how it is. Given money’s importance, you don’t want to be blind to your own financial realities.

With proper planning and budgeting, you can get the most out of your hard-earned money, and you can attain a certain level of security where you are aware of your revenues, expenses, and general financial situation.

This quick guide will help you better understand how to create budget plans that work for
you.

Time and Money

Typically, you’ll want to budget on a monthly and yearly basis. Income and expenses are likely to change after a year, so longer-term budget projections aren’t very useful for much other than getting a very general idea of what the future may look like.

A budget plan template is a great way to visualize the complexities of your budget over time. Tools like budget planner books can help organize your monthly and yearly budgets in a way that makes sense.

Benchmarks of a Realistic Budget

Obviously, you want to earn more than you spend and save something, but that’s not as simple as it sounds. As you put your budget together, it is necessary to be brutally honest with your expectations.

At the very least, a realistic budget satisfies all of the following:

  • Accounts for all costs and revenues
  • Is not overly generous
  • Dedicates a certain amount of money to savings
  • Accounts for potential emergencies and surprise costs
  • Includes plausible costs for food, shelter, and utilities
  • Determine Your revenue

What are your income sources, and how much do you expect to receive? When and how often are you paid? Your boss may have promised you a raise in a month, but until that actually happens, you should not budget for the future as if you’re certain to get that raise.

Do you work full-time, part-time? Are you a salaried employee? If you work hourly and are not a full-time employee, assume that you won’t get the best hours at any job you work at. This way, you’ll have budgeted for the worst-case scenario.

If you end up getting more hours, that’s great! Just be sure to quickly cycle any extra money into your budget and put it towards something productive. The best way to get ahead is to invest in yourself by clearing your debts and adding to your savings.

Figure Out Your Costs

budget planning

To put it simply, your cost is your expenses. In order to better understand your costs in the context of your entire budget, it’s important to break your costs down into fixed costs and variable costs. With this information, you can better understand your cash flow and identify points where you can save.

Fixed Costs

Your fixed costs are the costs that are recurring and consistent.

Major fixed costs include:

  • Rent or mortgage payments
  • Health insurance payments
  • Vehicle payments
  • Property taxes
  • Car insurance (barring accidents or changes in rates)
  • Internet bill
  • Student loans and other loans

Your fixed costs are unlikely to change in the short-term, but may in the long-term. For a yearly budget, it’s safe to assume these costs will be stable. If you rent on a monthly lease, then your rent may change over the year, so budget for an extra 20% for your total yearly rent just in case.

Variable Costs

These are the costs that are set to change each month.

Variable costs are made up of essential and non-essential costs. Essentials costs are the things that you really need, and non-essential costs are the extra things that you can securely live without.

Essential costs include but are not limited to:

  • Gasoline consumption
  • Home heating
  • Phone bills
  • Vehicle maintenance
  • Home maintenance
  • Food and groceries
  • Medical treatment and copays

Here are some examples of non-essential costs:

  • Subscriptions
  • Extra clothing
  • Entertainment
  • Eating out
  • Snacks
  • Vacations and trips

See Also: How to Budget Using the 50/20/30 Rule

Don’t Forget to Budget for Emergencies!

No one prays for an accident, but accidents happen, and you want to be in a position where you’re financially covered. After initial and essential expenses, put at least 20% of your income into a savings account. If you total your car or get injured and can’t work for a month, you’ll be glad that you have some savings to fall back on.

See Also: 5 Financial Emergencies Everyone Must Be Prepared For

Cutting Costs

effective budget plan

Your non-essential costs probably bring you a lot of joy, but these things cannot take priority over your essential costs. It’s easy to cut some of these costs without sacrificing your quality of life.

Trying to save money? Instead of dining out twice per week, try dining out once every other week and cooking a luxurious meal at home. You’ll save money, and you’ll have a great culinary experience in the comfort of your own home.

Groceries are an essential cost, but by making adjustments to your habits and consumption, you can decrease these costs. Instead of buying canned soups and premade meals at the grocery store, you can cook these things cheaper. Instead of going for the name brand, buy the store brand. They’re almost like the exact same thing, but it costs less.

Streaming is all the rage, but those services can add up. Oftentimes, people have so many services that they go for days, weeks, or months without using them, but all the while, they’re still paying! Honestly examine your app and subscription use. If you find that you hardly use that streaming service, unsubscribe. That $15 per month will really add up.

Those are just a couple of examples, but you can use the same logic to cut most of your non-essential costs and some of your essential costs

The Bottom Line

Cutting costs is good, but try not to cut costs that will lead to poor health outcomes. You can reduce your grocery expenditures, but you shouldn’t starve.

If you’re cutting all of the costs that you can, but you still aren’t making enough money, it’s time to look at your options. Some government-assistance programs may be able to help. Family members, charities, or food pantries can ease some of your food costs if you’re in a rut.

Your finances can help you get the life you desire if you plan. What useful tips and tricks help you budget towards your life goals? Let us know in the comments.

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Catalyst Fund gets $15M from JP Morgan, UK Aid to back 30 EM fintech startups

The Catalyst Fund has gained $15 million in new support from JP Morgan and UK Aid and will back 30 fintech startups in Africa, Asia, and Latin America over the next three years.

The Boston based accelerator provides mentorship and non-equity funding to early-stage tech ventures focused on driving financial inclusion in emerging and frontier markets.

That means connecting people who may not have access to basic financial services — like a bank account, credit or lending options — to those products.

Catalyst Fund will choose an annual cohort of 10 fintech startups in five designated countries: Kenya, Nigeria, South Africa, India and Mexico. Those selected will gain grant-funds and go through a six-month accelerator program. The details of that and how to apply are found here.

“We’re offering grants of up to $100,000 to early-stage companies, plus venture building support…and really…putting these companies on a path to product market fit,” Catalyst Fund Director Maelis Carraro told TechCrunch.

Program participants gain exposure to the fund’s investor networks and investor advisory committee, that include Accion and 500 Startups. With the $15 million Catalyst Fund will also make some additions to its network of global partners that support the accelerator program. Names will be forthcoming, but Carraro, was able to disclose that India’s Yes Bank and University of Cambridge are among them.

Catalyst fund has already accelerated 25 startups through its program. Companies, such as African payments venture ChipperCash and SokoWatch — an East African B2B e-commerce startup for informal retailers — have gone on to raise seven-figure rounds and expand to new markets.

Those are kinds of business moves Catalyst Fund aims to spur with its program. The accelerator was founded in 2016, backed by JP Morgan and the Bill & Melinda Gates Foundation.

Catalyst Fund is now supported and managed by Rockefeller Philanthropy Advisors and global tech consulting firm BFA.

African fintech startups have dominated the accelerator’s companies, comprising 56% of the portfolio into 2019.

That trend continued with Catalyst Fund’s most recent cohort, where five of six fintech ventures — Pesakit, Kwara, Cowrywise, Meerkat and Spoon — are African and one, agtech credit startup Farmart, operates in India.

The draw to Africa is because the continent demonstrates some of the greatest need for Catalyst Fund’s financial inclusion mission.

By several estimates, Africa is home to the largest share of the world’s unbanked population and has a sizable number of underbanked consumers and SMEs.

Roughly 66% of Sub-Saharan Africa’s 1 billion people don’t have a bank account, according to World Bank data.

Collectively, these numbers have led to the bulk of Africa’s VC funding going to thousands of fintech startups attempting to scale payment solutions on the continent.

Digital finance in Africa has also caught the attention of notable outside names. Twitter/Square CEO Jack Dorsey recently took an interest in Africa’s cryptocurrency potential and Wall Street giant Goldman Sachs has invested in fintech startups on the continent.

This lends to the question of JP Morgan’s interests vis-a-vis Catalyst Fund and Africa’s financial sector.

For now, JP Morgan doesn’t have plans to invest directly in Africa startups and is taking a long-view in its support of the accelerator, according to Colleen Briggs — JP Morgan’s Head of Community Innovation

“We find financial health and financial inclusion is a…cornerstone for inclusive growth…For us if you care about a stable economy, you have to start with financial inclusion,” said Briggs, who also oversees the Catalyst Fund.

This take aligns with JP Morgan’s 2019 announcement of a $125 million, philanthropic, five-year global commitment to improve financial health in the U.S. and globally.

More recently, JP Morgan Chase posted some of the strongest financial results on Wall Street, with Q4 profits of $2.9 billion. It’ll be worth following if the company shifts its income-generating prowess to business and venture funding activities in Catalyst Fund markets such as Nigeria, India and Mexico.

Making A Financial Plan: How to Set Financial Goals To Live Your Best Life

Financial planning is a crucial part of adult life, yet 40% of Americans have never had a budget.

Sticking to a budget can help prevent you from falling on hard times. It can also help you achieve your goals in life.

However, contrary to what most people are thinking, financial planning and budgeting aren’t just for retirement. It’s not just the practice of foregoing the occasional latte.

Making a financial plan can give you peace of mind and, eventually, the life you’ve always wanted.

Why Is Money So Stressful?

make a financial plan

People who have a financial plan are two times as likely to meet their financial goals as those who do not have such a plan, yet two in five people have never had a budget. More than one in three people spend more than they save, and two in three say they easily overspend when using a credit card.

But it’s not all bad news. 48% of Americans say they save at least 5% of their income, 65% say they have emergency savings, and 79% are either debt-free or they are actively paying down their debt.

Of consumers who report having a budget:

  • 62% say they are in control
  • 55% say they feel confident about their finances
  • 52% say they feel secure about their financial situations

Of consumers who do not have a budget:

  • 19% feel out of control with money
  • 18% are constantly worried about their finances
  • 17% report being stressed about money

When it comes to retirement, even though many people are saving, they still don’t know why or how much. In fact, 75% of Americans aren’t sure how much they should be saving, while 40% of those with retirement savings have no idea how their money is allocated. It’s no wonder the thought of budgeting and saving money is so stressful for so many people – even when we know that we are supposed to be doing it, we still often have no idea how.

See Also: GenZ and Money: How GenZ Faces Their Financial Fears

Setting Financial Goals And Sticking To Them

how to make a financial plan

If you are at a point in life where you are able to save money, congratulations!

Now, it’s time to ask yourself why you are saving money in the first place. Sure, everyone should be saving money for emergencies. But once you get past your emergency savings, there are all kinds of other savings you should be doing, from retirement to enhancing your quality of life.

So how do you want to live and what financial goals can you set to get to that point?

Sometimes, setting financial goals starts with reinventing yourself.

What kind of career would get you out of bed every day? How would you spend spare time if you had it? Is there something you would like to learn or a new educational goal you’d like to meet?

Last year 39% of Americans said they wanted to save more money and for many, that means making a career change.

Setting goals for yourself helps you to understand what steps you need to take to meet them. 97% of parents say they want to pay all or part of their child’s college tuition, yet few understand just how much money that is or how much they should be saving right now in order to accomplish that goal. Currently, only 27% are on track to meet those goals.

Setting goals and then figuring out what action you need to take now in order to achieve them is critical.

Once Basic Goals Are Met, Make Your Life Worth Living

The main reason for financial planning is that someday you will want to be able to live life on your own terms. The better your financial planning, the sooner you will be able to live the life you want because of it.

Once you have enough to cover all of your financial goals, it’s time to figure out how to buy back some of your time. There are apps and tech gadgets that can take over your daily tasks like cutting the lawn, cleaning the pool, and hiring a handyman. Using these services can help you feel like your hard work has been rewarded when you are able to do the things you want instead of having to do the things that need to be done.

Financial planning is an important first step toward the life you want. Learn more about freeing up time, reducing stress, and living your best life through financial planning below!

The post Making A Financial Plan: How to Set Financial Goals To Live Your Best Life appeared first on Dumb Little Man.

A House-Buying Guide For Millennials

Buying a house can be an exciting time in anyone’s life, and it’s a huge milestone that you should celebrate. Millennials buying houses is nothing new, but there’s a new surge of younger homebuyers throughout the United States.

If you’re one of them, read on for a few great tips to help you get the home of your dreams without breaking the bank.

Pay Off Your Debt First

Before you go out and get into more debt, consider paying off any you already owe. Student loans, personal loans, and credit card debts are the big three that come to mind. When you pay them off, you have more money available for your mortgage, down payment, or savings. Work to pay your debt off as quickly as possible, so you’re free and clear to buy a house.

Look for a House that Fits Your Lifestyle

millenial house buying

Buying a house can be a lengthy process, but don’t be tempted to rush into a home that doesn’t match your lifestyle. Purchasing the wrong one–whether it’s a mismatch for your needs or leaves you financially overextended–can lead to problems later on, and you may even end up selling prematurely, which isn’t ideal if you’re trying to build equity. Instead of focusing exclusively on what’s inside the house, consider the its distance from work and family, the outdoor space (especially if you have kids or pets), and the overall carrying costs–not just the monthly payment. You can find yourself stuck and stressed out if you don’t.

Buy With the Future in Mind

What will your future self want in a house? If you’re young and single, buying a house in the center of a city by thriving nightlife may seem like a dream, but what happens when you settle down? If you buy a small house, what happens when you have kids if you plan for them? Take a few minutes and think about your longer-range plans, and see how your house falls into them.

Consider the Current State of the Property

So many videos, blogs, YouTube channels, and television shows make home improvement seem so easy. The truth is, it can be a big time and money suck if you’re not sure what you’re doing. It’s usually worth it to buy a home that is in good repair instead of saving a few thousand by buying one that isn’t in a good state. Those few thousand you initially save will be gone very quickly on renovations.

Save for a Down Payment

Many young people forget to put money aside for a down payment, and it comes back to haunt them later. The more you can put down for your down payment, the more affordable your payments will be. Ideally, you should have at least 10% of your home’s purchase price on-hand and ready to use, if not 20%.

Shop in a Buyer’s Market

A buyer’s market is when there are more houses available than meets demand, so the sellers compete with lower prices. The homebuyer has the advantage here, and you can shop through an area and see how the prices differ. If the house has been available for a while, the seller may be willing to reduce the price just to get it off their hands.

Calculate How Much Home You Can Afford

millenials house buying

Before you start shopping, consider how much home you can afford. This way, you don’t get your hopes up on a house that is way out of your budget. Ideally, you want to keep all of your housing-related expenses like mortgage, insurance, and any HOA fees to no more than 25% to 30% of your monthly take-home pay. This amount will leave you with enough money to fix up your home or build savings.

Get Preapproved for a Loan

This point goes back to knowing how much home you can afford. Millennials buying houses tend to skip this step, and it can set the home search back. For example, you can’t make an offer on the house without a pre-approval letter, and the letter can take a week or two. In this time, the home you had your eye on could be long gone. Start home shopping with a pre-approval letter in your hand, and stay in your budget.

What is Your Exit Strategy?

Normally, the first home you buy isn’t your forever home. When it’s time to move on, how will your home fare with your exit strategy? Will it be easy to rent out or sell? Is it big enough for a couple to start their own family in? How is the local school district? What are your neighbors like? Keep all of these things in mind when you’re on your search.

Keep the Process Moving

Once you start the homebuying process, see it through. Stay in the loop so you can stay on top of your agent or any other third parties, like the inspection company. If you can avoid it, never make a seller wait during the contingency period. You want to get the deal done as soon as possible, without tempting the seller to explore backup offers from buyers willing to move faster than you.

Be Honest and Authentic with the Seller

For many people, selling their home is a very emotional process. You can try to connect with them by sending them a short, handwritten note that explains why the home would be perfect for you. This letter can give you an emotional connection with the seller, and make them more likely to entertain your offer.

Buying a home can be a rewarding but overwhelming process, especially if you’re not prepared. Use our 11 tips to help streamline your home buying process and find your dream home.

See Also: Here’s What Millennials Want When They Buy A Home

The post A House-Buying Guide For Millennials appeared first on Dumb Little Man.

Saving Half of Income: 5 Steps to Effortlessly Save Money Every Month

“Payment Successful”

That’s it. Gone forever.

Your last $50 spent in grocery bills and you think “Where does all my money go?” .

You wonder how your co-workers can afford all the glitter and gold while you end up without a dime to pay for the piling bills.

In fact, you always have this nagging feeling that you’ll end up spending your next paycheck with nothing to show for it.

And you can’t help but think:

Is it normal to feel like I’ll lose all my money even if I won the lottery? Will I always be dead broke or pretty much close?

Deep down, you know you are NOT on the right track.

Things must change.

Step 1 – Commit to mastery

Five thousand four hundred and seventy five…

The days it took for ancient Chinese monks to master the art of Kung-Fu. Guess what they were doing for all those hours?

Practicing Kung-Fu.

But more importantly, they vowed to dedicate not only those hours, but their entire lives to the Art.

The Monk’s Guide to Saving

You’re probably wondering what Martial Arts have to do with your money. Well, here’s the big secret:

Although learning to save doesn’t require hours of vigorous training, like Kung Fu, it does require a fair deal of practice and discipline.

Why?

Because more than an ingrained habit, savings must be a mastered skill. Granted, that takes sustained effort, restraint, patience, and time.

Once you make an unwavering commitment to set aside a specific amount every month, you are well on your way to quadrupling your savings in no time.

So, adjust your mindset and commit to practicing all the steps.

WARNING:

Most people take this step for granted and make a fickle decision to sparingly set aside “some money, somehow”.

And guess what?

They end up with zero in savings and bitter with life.

Obviously, that’s a recipe for disaster and you want to avoid it at all costs. It will sour your taste buds and empty your pockets, literally.

Step 2 – Record all income

how to save half of income

Quick Question:…

Do you know exactly what you earned last month?

I mean with 99.99% precision.

Cracking your brain yet?

When planning to save, it is not uncommon for people to become absorbed in monitoring their expenses while completely ignoring the essential piece. It’s tracking their income every day.

Determining the exact amount you receive in daily earnings is a crucial step that provides the basis for the following:

  • Means to identify your primary and secondary sources of income
  • Scale to measure an increase or a decrease in your earnings
  • Guide to track all of your expenses
  • Road-map to monitor your progress towards savings
  • A Reference point for making informed future investment decisions

See how this gold mine of useful information can improve your overall financial well-being?

The ridiculously easy way to keep track of your income

Tracking anything isn’t easy, especially your income. You have no idea what those cryptic bank statements mean and you have no clue what ledgers are. You have zero interest in the term “deductibles”.

Not to worry, you don’t need to know all those boring accounting jargon.

In fact, all you need is to record every dollar bill you earn every day and translate that to your weekly and overall monthly earnings.

Here is a simple sheet to illustrate the concept a little better:

Source : Hours – Pay Per Hour – Daily – Weekly – Monthly
Salary :     8    –        $10       –  $80  –     $      –   $
Business :               $100       –  $100 –    $    –    $
Other – – – – –
Total:                       $180     –      $   –     $
Date: Today

Don’t worry, you can adapt it to your particular situation.

Why the slightest changes to your money matter

The total of your monthly earnings is like a mini-map that guides you to your saving goal by informing you about your current position, destination, and journey.

Hence, tracking the slightest changes in your daily income with precision is key to ensuring your mini-map is accurate. Use the format above for guidance. Copy it into a jotter and practice every day for the next month.

Note: You would prefer to write your earnings with pen on paper because it excites your senses and provides you with a handy reference point.

Step 3 – Spend it all

Pour all your money down the drain!

Yep, you heard me right. Spend every penny you make, but do it the right way.

Before you think I am a financial Frankenstein speaking in tongues and desperate to make you my lab rat, allow me to explain.

Every day, for the next 30 days, you’ll be spending your recorded income as usual but with a little tweak.

How to tweak your spending for maximum results

You will take note of every little expense- like down to .99 cents.

Because again, you probably have no clue what your previous month’s expenses were. And to improve your saving habits, you’ll need to identify the areas you spend money the most and make adjustments.

A surprising lesson from billionaires

You would think that billionaire Warren Buffet owns a luxurious fleet of custom Rolls Royce Coupes delivered directly from the factory to his Garage every year.

Well, that isn’t the case.

He actually drives a $23,000 Cadillac DTS and he bought a used one.

Shocking?

Most mega-rich people like Jeff Bezos and Mark Zuckerberg understand and apply a timeless and effective financial secret.

The simple saving technique that never fails is that they live below their means by prioritizing needs over wants.

In other words, whatever isn’t a necessity is eliminated. And you’ll be applying the same principle to fast track the process of saving half of your income or even more every month.

Take note of your spending every single day, preferably for the next 30 days.

Within a month, you would have recorded your earnings, drilled down on your spending habits, and produced a clear (most times shocking) picture of where you are throwing away money.

Only then will you be in a better position to prioritize your needs and eliminate your wants.

Step 4 – Hone your skills

save half of income

At this point, you’d be halfway towards saving half of income and ready to hone your newly acquired saving skills by applying some effective tips.

Ready?

To proceed further down the rabbit hole, it is crucial to learn this lesson:

Set a savings and spending goal for the next month.

Example:

  • January savings goal: 50% of monthly income
  • January spending goal: 50% of monthly income

If the expense tracking exercise reveals that you are capable of living on 50% of your income (or less), then increase your savings by using the tips below. If, not, then use the following tips to lower your monthly spending.

10 Ideas for Saving Effectively

  • Stay organized by dividing cash into envelopes with categories like “food”, “rent”, and “transport”. When an envelope runs empty, stop spending in that category.
  • Reduce the discreet flow of energy (Phantom Power) by unplugging cell phone chargers, TVs, and computers when you’re not using them.
  • Walk, bike, use the subway, ride the tram, bus or commute to easily save more than $100 per month on gas.
  • Leave your wallet when you head out so you won’t be tempted to grab coffee or go on a mini shopping trip.
  • Save at least $500 a year by canceling cable TV and switching to alternatives like Netflix which costs $8 per month.
  • Buy items in bulk to save money on unit price.
  • Sleep, exercise, and eat healthy to prevent incurring expensive medical bills.
  • Reduce impulse purchases by sticking to a shopping list when going to the grocery store.
  • Save spare change in a piggy bank.
  • Eat in, not out.

Note: You can add more to these tips. Be creative. When reducing your monthly expenses, focus on every possible angle and don’t leave any stones unturned.

Step 5 – Test Run, Rinse, and Repeat

The rubber meets the road here…

Time to test your new set of acquired skills. Use this effective testing template:

  • Month 1: Apply steps 1 to 3 every day
  • Month 2: Apply steps 2 – 5 every day

What happens after Month 2?

Tweak your progress and repeat. From the second month onward, two things can happen.

It’s either you fail to act and end up back in square one or you commit to applying all steps and save half of your income or more.

Final Thoughts

Being broke sucks, particularly when you know you are throwing money away.

But simple changes to the way you spend can have dramatic effects on your saving habits. Just imagine ending up with every dollar saved at the end of the month.

Imagine waking up every day with absolute financial freedom that comes from being penny-wise. Think about being able to afford that nice Mercedes or that chateau in Cannes or perhaps, that comfy corner couch you have been interested in for a while now.

Remember, success is the gradual realization of a worthy ideal.

To begin your successful journey, apply the first and second techniques above, starting now. Commit to practicing the rest of the process every day, for the next few weeks. Keep track, make changes, and improve as you go along.

You could be saving half of income or more next month.

See Also: HSA or FSA: Which One Do You Really Need To Maximize Your Savings?

The post Saving Half of Income: 5 Steps to Effortlessly Save Money Every Month appeared first on Dumb Little Man.

Saving Half of Income: 5 Steps to Effortlessly Save Money Every Month

“Payment Successful”

That’s it. Gone forever.

Your last $50 spent in grocery bills and you think “Where does all my money go?” .

You wonder how your co-workers can afford all the glitter and gold while you end up without a dime to pay for the piling bills.

In fact, you always have this nagging feeling that you’ll end up spending your next paycheck with nothing to show for it.

And you can’t help but think:

Is it normal to feel like I’ll lose all my money even if I won the lottery? Will I always be dead broke or pretty much close?

Deep down, you know you are NOT on the right track.

Things must change.

Step 1 – Commit to mastery

Five thousand four hundred and seventy five…

The days it took for ancient Chinese monks to master the art of Kung-Fu. Guess what they were doing for all those hours?

Practicing Kung-Fu.

But more importantly, they vowed to dedicate not only those hours, but their entire lives to the Art.

The Monk’s Guide to Saving

You’re probably wondering what Martial Arts have to do with your money. Well, here’s the big secret:

Although learning to save doesn’t require hours of vigorous training, like Kung Fu, it does require a fair deal of practice and discipline.

Why?

Because more than an ingrained habit, savings must be a mastered skill. Granted, that takes sustained effort, restraint, patience, and time.

Once you make an unwavering commitment to set aside a specific amount every month, you are well on your way to quadrupling your savings in no time.

So, adjust your mindset and commit to practicing all the steps.

WARNING:

Most people take this step for granted and make a fickle decision to sparingly set aside “some money, somehow”.

And guess what?

They end up with zero in savings and bitter with life.

Obviously, that’s a recipe for disaster and you want to avoid it at all costs. It will sour your taste buds and empty your pockets, literally.

Step 2 – Record all income

how to save half of income

Quick Question:…

Do you know exactly what you earned last month?

I mean with 99.99% precision.

Cracking your brain yet?

When planning to save, it is not uncommon for people to become absorbed in monitoring their expenses while completely ignoring the essential piece. It’s tracking their income every day.

Determining the exact amount you receive in daily earnings is a crucial step that provides the basis for the following:

  • Means to identify your primary and secondary sources of income
  • Scale to measure an increase or a decrease in your earnings
  • Guide to track all of your expenses
  • Road-map to monitor your progress towards savings
  • A Reference point for making informed future investment decisions

See how this gold mine of useful information can improve your overall financial well-being?

The ridiculously easy way to keep track of your income

Tracking anything isn’t easy, especially your income. You have no idea what those cryptic bank statements mean and you have no clue what ledgers are. You have zero interest in the term “deductibles”.

Not to worry, you don’t need to know all those boring accounting jargon.

In fact, all you need is to record every dollar bill you earn every day and translate that to your weekly and overall monthly earnings.

Here is a simple sheet to illustrate the concept a little better:

Source : Hours – Pay Per Hour – Daily – Weekly – Monthly
Salary :     8    –        $10       –  $80  –     $      –   $
Business :               $100       –  $100 –    $    –    $
Other – – – – –
Total:                       $180     –      $   –     $
Date: Today

Don’t worry, you can adapt it to your particular situation.

Why the slightest changes to your money matter

The total of your monthly earnings is like a mini-map that guides you to your saving goal by informing you about your current position, destination, and journey.

Hence, tracking the slightest changes in your daily income with precision is key to ensuring your mini-map is accurate. Use the format above for guidance. Copy it into a jotter and practice every day for the next month.

Note: You would prefer to write your earnings with pen on paper because it excites your senses and provides you with a handy reference point.

Step 3 – Spend it all

Pour all your money down the drain!

Yep, you heard me right. Spend every penny you make, but do it the right way.

Before you think I am a financial Frankenstein speaking in tongues and desperate to make you my lab rat, allow me to explain.

Every day, for the next 30 days, you’ll be spending your recorded income as usual but with a little tweak.

How to tweak your spending for maximum results

You will take note of every little expense- like down to .99 cents.

Because again, you probably have no clue what your previous month’s expenses were. And to improve your saving habits, you’ll need to identify the areas you spend money the most and make adjustments.

A surprising lesson from billionaires

You would think that billionaire Warren Buffet owns a luxurious fleet of custom Rolls Royce Coupes delivered directly from the factory to his Garage every year.

Well, that isn’t the case.

He actually drives a $23,000 Cadillac DTS and he bought a used one.

Shocking?

Most mega-rich people like Jeff Bezos and Mark Zuckerberg understand and apply a timeless and effective financial secret.

The simple saving technique that never fails is that they live below their means by prioritizing needs over wants.

In other words, whatever isn’t a necessity is eliminated. And you’ll be applying the same principle to fast track the process of saving half of your income or even more every month.

Take note of your spending every single day, preferably for the next 30 days.

Within a month, you would have recorded your earnings, drilled down on your spending habits, and produced a clear (most times shocking) picture of where you are throwing away money.

Only then will you be in a better position to prioritize your needs and eliminate your wants.

Step 4 – Hone your skills

save half of income

At this point, you’d be halfway towards saving half of income and ready to hone your newly acquired saving skills by applying some effective tips.

Ready?

To proceed further down the rabbit hole, it is crucial to learn this lesson:

Set a savings and spending goal for the next month.

Example:

  • January savings goal: 50% of monthly income
  • January spending goal: 50% of monthly income

If the expense tracking exercise reveals that you are capable of living on 50% of your income (or less), then increase your savings by using the tips below. If, not, then use the following tips to lower your monthly spending.

10 Ideas for Saving Effectively

  • Stay organized by dividing cash into envelopes with categories like “food”, “rent”, and “transport”. When an envelope runs empty, stop spending in that category.
  • Reduce the discreet flow of energy (Phantom Power) by unplugging cell phone chargers, TVs, and computers when you’re not using them.
  • Walk, bike, use the subway, ride the tram, bus or commute to easily save more than $100 per month on gas.
  • Leave your wallet when you head out so you won’t be tempted to grab coffee or go on a mini shopping trip.
  • Save at least $500 a year by canceling cable TV and switching to alternatives like Netflix which costs $8 per month.
  • Buy items in bulk to save money on unit price.
  • Sleep, exercise, and eat healthy to prevent incurring expensive medical bills.
  • Reduce impulse purchases by sticking to a shopping list when going to the grocery store.
  • Save spare change in a piggy bank.
  • Eat in, not out.

Note: You can add more to these tips. Be creative. When reducing your monthly expenses, focus on every possible angle and don’t leave any stones unturned.

Step 5 – Test Run, Rinse, and Repeat

The rubber meets the road here…

Time to test your new set of acquired skills. Use this effective testing template:

  • Month 1: Apply steps 1 to 3 every day
  • Month 2: Apply steps 2 – 5 every day

What happens after Month 2?

Tweak your progress and repeat. From the second month onward, two things can happen.

It’s either you fail to act and end up back in square one or you commit to applying all steps and save half of your income or more.

Final Thoughts

Being broke sucks, particularly when you know you are throwing money away.

But simple changes to the way you spend can have dramatic effects on your saving habits. Just imagine ending up with every dollar saved at the end of the month.

Imagine waking up every day with absolute financial freedom that comes from being penny-wise. Think about being able to afford that nice Mercedes or that chateau in Cannes or perhaps, that comfy corner couch you have been interested in for a while now.

Remember, success is the gradual realization of a worthy ideal.

To begin your successful journey, apply the first and second techniques above, starting now. Commit to practicing the rest of the process every day, for the next few weeks. Keep track, make changes, and improve as you go along.

You could be saving half of income or more next month.

See Also: HSA or FSA: Which One Do You Really Need To Maximize Your Savings?

The post Saving Half of Income: 5 Steps to Effortlessly Save Money Every Month appeared first on Dumb Little Man.

Saving Half of Income: 5 Steps to Effortlessly Save Money Every Month

“Payment Successful”

That’s it. Gone forever.

Your last $50 spent in grocery bills and you think “Where does all my money go?” .

You wonder how your co-workers can afford all the glitter and gold while you end up without a dime to pay for the piling bills.

In fact, you always have this nagging feeling that you’ll end up spending your next paycheck with nothing to show for it.

And you can’t help but think:

Is it normal to feel like I’ll lose all my money even if I won the lottery? Will I always be dead broke or pretty much close?

Deep down, you know you are NOT on the right track.

Things must change.

Step 1 – Commit to mastery

Five thousand four hundred and seventy five…

The days it took for ancient Chinese monks to master the art of Kung-Fu. Guess what they were doing for all those hours?

Practicing Kung-Fu.

But more importantly, they vowed to dedicate not only those hours, but their entire lives to the Art.

The Monk’s Guide to Saving

You’re probably wondering what Martial Arts have to do with your money. Well, here’s the big secret:

Although learning to save doesn’t require hours of vigorous training, like Kung Fu, it does require a fair deal of practice and discipline.

Why?

Because more than an ingrained habit, savings must be a mastered skill. Granted, that takes sustained effort, restraint, patience, and time.

Once you make an unwavering commitment to set aside a specific amount every month, you are well on your way to quadrupling your savings in no time.

So, adjust your mindset and commit to practicing all the steps.

WARNING:

Most people take this step for granted and make a fickle decision to sparingly set aside “some money, somehow”.

And guess what?

They end up with zero in savings and bitter with life.

Obviously, that’s a recipe for disaster and you want to avoid it at all costs. It will sour your taste buds and empty your pockets, literally.

Step 2 – Record all income

how to save half of income

Quick Question:…

Do you know exactly what you earned last month?

I mean with 99.99% precision.

Cracking your brain yet?

When planning to save, it is not uncommon for people to become absorbed in monitoring their expenses while completely ignoring the essential piece. It’s tracking their income every day.

Determining the exact amount you receive in daily earnings is a crucial step that provides the basis for the following:

  • Means to identify your primary and secondary sources of income
  • Scale to measure an increase or a decrease in your earnings
  • Guide to track all of your expenses
  • Road-map to monitor your progress towards savings
  • A Reference point for making informed future investment decisions

See how this gold mine of useful information can improve your overall financial well-being?

The ridiculously easy way to keep track of your income

Tracking anything isn’t easy, especially your income. You have no idea what those cryptic bank statements mean and you have no clue what ledgers are. You have zero interest in the term “deductibles”.

Not to worry, you don’t need to know all those boring accounting jargon.

In fact, all you need is to record every dollar bill you earn every day and translate that to your weekly and overall monthly earnings.

Here is a simple sheet to illustrate the concept a little better:

Source : Hours – Pay Per Hour – Daily – Weekly – Monthly
Salary :     8    –        $10       –  $80  –     $      –   $
Business :               $100       –  $100 –    $    –    $
Other – – – – –
Total:                       $180     –      $   –     $
Date: Today

Don’t worry, you can adapt it to your particular situation.

Why the slightest changes to your money matter

The total of your monthly earnings is like a mini-map that guides you to your saving goal by informing you about your current position, destination, and journey.

Hence, tracking the slightest changes in your daily income with precision is key to ensuring your mini-map is accurate. Use the format above for guidance. Copy it into a jotter and practice every day for the next month.

Note: You would prefer to write your earnings with pen on paper because it excites your senses and provides you with a handy reference point.

Step 3 – Spend it all

Pour all your money down the drain!

Yep, you heard me right. Spend every penny you make, but do it the right way.

Before you think I am a financial Frankenstein speaking in tongues and desperate to make you my lab rat, allow me to explain.

Every day, for the next 30 days, you’ll be spending your recorded income as usual but with a little tweak.

How to tweak your spending for maximum results

You will take note of every little expense- like down to .99 cents.

Because again, you probably have no clue what your previous month’s expenses were. And to improve your saving habits, you’ll need to identify the areas you spend money the most and make adjustments.

A surprising lesson from billionaires

You would think that billionaire Warren Buffet owns a luxurious fleet of custom Rolls Royce Coupes delivered directly from the factory to his Garage every year.

Well, that isn’t the case.

He actually drives a $23,000 Cadillac DTS and he bought a used one.

Shocking?

Most mega-rich people like Jeff Bezos and Mark Zuckerberg understand and apply a timeless and effective financial secret.

The simple saving technique that never fails is that they live below their means by prioritizing needs over wants.

In other words, whatever isn’t a necessity is eliminated. And you’ll be applying the same principle to fast track the process of saving half of your income or even more every month.

Take note of your spending every single day, preferably for the next 30 days.

Within a month, you would have recorded your earnings, drilled down on your spending habits, and produced a clear (most times shocking) picture of where you are throwing away money.

Only then will you be in a better position to prioritize your needs and eliminate your wants.

Step 4 – Hone your skills

save half of income

At this point, you’d be halfway towards saving half of income and ready to hone your newly acquired saving skills by applying some effective tips.

Ready?

To proceed further down the rabbit hole, it is crucial to learn this lesson:

Set a savings and spending goal for the next month.

Example:

  • January savings goal: 50% of monthly income
  • January spending goal: 50% of monthly income

If the expense tracking exercise reveals that you are capable of living on 50% of your income (or less), then increase your savings by using the tips below. If, not, then use the following tips to lower your monthly spending.

10 Ideas for Saving Effectively

  • Stay organized by dividing cash into envelopes with categories like “food”, “rent”, and “transport”. When an envelope runs empty, stop spending in that category.
  • Reduce the discreet flow of energy (Phantom Power) by unplugging cell phone chargers, TVs, and computers when you’re not using them.
  • Walk, bike, use the subway, ride the tram, bus or commute to easily save more than $100 per month on gas.
  • Leave your wallet when you head out so you won’t be tempted to grab coffee or go on a mini shopping trip.
  • Save at least $500 a year by canceling cable TV and switching to alternatives like Netflix which costs $8 per month.
  • Buy items in bulk to save money on unit price.
  • Sleep, exercise, and eat healthy to prevent incurring expensive medical bills.
  • Reduce impulse purchases by sticking to a shopping list when going to the grocery store.
  • Save spare change in a piggy bank.
  • Eat in, not out.

Note: You can add more to these tips. Be creative. When reducing your monthly expenses, focus on every possible angle and don’t leave any stones unturned.

Step 5 – Test Run, Rinse, and Repeat

The rubber meets the road here…

Time to test your new set of acquired skills. Use this effective testing template:

  • Month 1: Apply steps 1 to 3 every day
  • Month 2: Apply steps 2 – 5 every day

What happens after Month 2?

Tweak your progress and repeat. From the second month onward, two things can happen.

It’s either you fail to act and end up back in square one or you commit to applying all steps and save half of your income or more.

Final Thoughts

Being broke sucks, particularly when you know you are throwing money away.

But simple changes to the way you spend can have dramatic effects on your saving habits. Just imagine ending up with every dollar saved at the end of the month.

Imagine waking up every day with absolute financial freedom that comes from being penny-wise. Think about being able to afford that nice Mercedes or that chateau in Cannes or perhaps, that comfy corner couch you have been interested in for a while now.

Remember, success is the gradual realization of a worthy ideal.

To begin your successful journey, apply the first and second techniques above, starting now. Commit to practicing the rest of the process every day, for the next few weeks. Keep track, make changes, and improve as you go along.

You could be saving half of income or more next month.

See Also: HSA or FSA: Which One Do You Really Need To Maximize Your Savings?

The post Saving Half of Income: 5 Steps to Effortlessly Save Money Every Month appeared first on Dumb Little Man.

Saving Half of Income: 5 Steps to Effortlessly Save Money Every Month

“Payment Successful”

That’s it. Gone forever.

Your last $50 spent in grocery bills and you think “Where does all my money go?” .

You wonder how your co-workers can afford all the glitter and gold while you end up without a dime to pay for the piling bills.

In fact, you always have this nagging feeling that you’ll end up spending your next paycheck with nothing to show for it.

And you can’t help but think:

Is it normal to feel like I’ll lose all my money even if I won the lottery? Will I always be dead broke or pretty much close?

Deep down, you know you are NOT on the right track.

Things must change.

Step 1 – Commit to mastery

Five thousand four hundred and seventy five…

The days it took for ancient Chinese monks to master the art of Kung-Fu. Guess what they were doing for all those hours?

Practicing Kung-Fu.

But more importantly, they vowed to dedicate not only those hours, but their entire lives to the Art.

The Monk’s Guide to Saving

You’re probably wondering what Martial Arts have to do with your money. Well, here’s the big secret:

Although learning to save doesn’t require hours of vigorous training, like Kung Fu, it does require a fair deal of practice and discipline.

Why?

Because more than an ingrained habit, savings must be a mastered skill. Granted, that takes sustained effort, restraint, patience, and time.

Once you make an unwavering commitment to set aside a specific amount every month, you are well on your way to quadrupling your savings in no time.

So, adjust your mindset and commit to practicing all the steps.

WARNING:

Most people take this step for granted and make a fickle decision to sparingly set aside “some money, somehow”.

And guess what?

They end up with zero in savings and bitter with life.

Obviously, that’s a recipe for disaster and you want to avoid it at all costs. It will sour your taste buds and empty your pockets, literally.

Step 2 – Record all income

how to save half of income

Quick Question:…

Do you know exactly what you earned last month?

I mean with 99.99% precision.

Cracking your brain yet?

When planning to save, it is not uncommon for people to become absorbed in monitoring their expenses while completely ignoring the essential piece. It’s tracking their income every day.

Determining the exact amount you receive in daily earnings is a crucial step that provides the basis for the following:

  • Means to identify your primary and secondary sources of income
  • Scale to measure an increase or a decrease in your earnings
  • Guide to track all of your expenses
  • Road-map to monitor your progress towards savings
  • A Reference point for making informed future investment decisions

See how this gold mine of useful information can improve your overall financial well-being?

The ridiculously easy way to keep track of your income

Tracking anything isn’t easy, especially your income. You have no idea what those cryptic bank statements mean and you have no clue what ledgers are. You have zero interest in the term “deductibles”.

Not to worry, you don’t need to know all those boring accounting jargon.

In fact, all you need is to record every dollar bill you earn every day and translate that to your weekly and overall monthly earnings.

Here is a simple sheet to illustrate the concept a little better:

Source : Hours – Pay Per Hour – Daily – Weekly – Monthly
Salary :     8    –        $10       –  $80  –     $      –   $
Business :               $100       –  $100 –    $    –    $
Other – – – – –
Total:                       $180     –      $   –     $
Date: Today

Don’t worry, you can adapt it to your particular situation.

Why the slightest changes to your money matter

The total of your monthly earnings is like a mini-map that guides you to your saving goal by informing you about your current position, destination, and journey.

Hence, tracking the slightest changes in your daily income with precision is key to ensuring your mini-map is accurate. Use the format above for guidance. Copy it into a jotter and practice every day for the next month.

Note: You would prefer to write your earnings with pen on paper because it excites your senses and provides you with a handy reference point.

Step 3 – Spend it all

Pour all your money down the drain!

Yep, you heard me right. Spend every penny you make, but do it the right way.

Before you think I am a financial Frankenstein speaking in tongues and desperate to make you my lab rat, allow me to explain.

Every day, for the next 30 days, you’ll be spending your recorded income as usual but with a little tweak.

How to tweak your spending for maximum results

You will take note of every little expense- like down to .99 cents.

Because again, you probably have no clue what your previous month’s expenses were. And to improve your saving habits, you’ll need to identify the areas you spend money the most and make adjustments.

A surprising lesson from billionaires

You would think that billionaire Warren Buffet owns a luxurious fleet of custom Rolls Royce Coupes delivered directly from the factory to his Garage every year.

Well, that isn’t the case.

He actually drives a $23,000 Cadillac DTS and he bought a used one.

Shocking?

Most mega-rich people like Jeff Bezos and Mark Zuckerberg understand and apply a timeless and effective financial secret.

The simple saving technique that never fails is that they live below their means by prioritizing needs over wants.

In other words, whatever isn’t a necessity is eliminated. And you’ll be applying the same principle to fast track the process of saving half of your income or even more every month.

Take note of your spending every single day, preferably for the next 30 days.

Within a month, you would have recorded your earnings, drilled down on your spending habits, and produced a clear (most times shocking) picture of where you are throwing away money.

Only then will you be in a better position to prioritize your needs and eliminate your wants.

Step 4 – Hone your skills

save half of income

At this point, you’d be halfway towards saving half of income and ready to hone your newly acquired saving skills by applying some effective tips.

Ready?

To proceed further down the rabbit hole, it is crucial to learn this lesson:

Set a savings and spending goal for the next month.

Example:

  • January savings goal: 50% of monthly income
  • January spending goal: 50% of monthly income

If the expense tracking exercise reveals that you are capable of living on 50% of your income (or less), then increase your savings by using the tips below. If, not, then use the following tips to lower your monthly spending.

10 Ideas for Saving Effectively

  • Stay organized by dividing cash into envelopes with categories like “food”, “rent”, and “transport”. When an envelope runs empty, stop spending in that category.
  • Reduce the discreet flow of energy (Phantom Power) by unplugging cell phone chargers, TVs, and computers when you’re not using them.
  • Walk, bike, use the subway, ride the tram, bus or commute to easily save more than $100 per month on gas.
  • Leave your wallet when you head out so you won’t be tempted to grab coffee or go on a mini shopping trip.
  • Save at least $500 a year by canceling cable TV and switching to alternatives like Netflix which costs $8 per month.
  • Buy items in bulk to save money on unit price.
  • Sleep, exercise, and eat healthy to prevent incurring expensive medical bills.
  • Reduce impulse purchases by sticking to a shopping list when going to the grocery store.
  • Save spare change in a piggy bank.
  • Eat in, not out.

Note: You can add more to these tips. Be creative. When reducing your monthly expenses, focus on every possible angle and don’t leave any stones unturned.

Step 5 – Test Run, Rinse, and Repeat

The rubber meets the road here…

Time to test your new set of acquired skills. Use this effective testing template:

  • Month 1: Apply steps 1 to 3 every day
  • Month 2: Apply steps 2 – 5 every day

What happens after Month 2?

Tweak your progress and repeat. From the second month onward, two things can happen.

It’s either you fail to act and end up back in square one or you commit to applying all steps and save half of your income or more.

Final Thoughts

Being broke sucks, particularly when you know you are throwing money away.

But simple changes to the way you spend can have dramatic effects on your saving habits. Just imagine ending up with every dollar saved at the end of the month.

Imagine waking up every day with absolute financial freedom that comes from being penny-wise. Think about being able to afford that nice Mercedes or that chateau in Cannes or perhaps, that comfy corner couch you have been interested in for a while now.

Remember, success is the gradual realization of a worthy ideal.

To begin your successful journey, apply the first and second techniques above, starting now. Commit to practicing the rest of the process every day, for the next few weeks. Keep track, make changes, and improve as you go along.

You could be saving half of income or more next month.

See Also: HSA or FSA: Which One Do You Really Need To Maximize Your Savings?

The post Saving Half of Income: 5 Steps to Effortlessly Save Money Every Month appeared first on Dumb Little Man.

How to Plan a Simple Engagement Party On a Budget

Throwing an epic party doesn’t have to mean emptying your bank account. After all, it should be about creating lasting memories and not the amount of money you and your partner spend. To plan the most awesome engagement party on a budget, here are some tricks you might want to try.

Use Candles

budget engagement party

Candles are the tiniest and cutest decorations one can ever have! They are traditional, symbolic, and fulfilling.

Using candles instead of lanterns cuts your budget in half and still gives all the romantic feels. If you decide to use candles for the table decorations, you don’t even need to do other table decors. One or two candles and a few flowers are enough to throw super positive vibes. You can also try balloons to decorate the walls. The best part of using candles is that it pairs well with any lush arrangement.

Have an Informal Dinner

There are many people whose only concern is to have a lavish dinner at engagement parties. Well, if you want to provide that, you can do so without compromising your budget.

There are many eating options available that are delicious and cost-effective. You just need to think out of the box and try varieties.

Instead of cumbersome menus, arrange some seasonal juices, light appetizers, and moving snacks. You can also avoid serving champagne and settle with cocktails or mocktails.

If you want to get rid of the whole dinner stuff, you can arrange the party after dinner hours. After all, it’s your engagement party and not theirs. The choice should be yours.

See Also: An Easy Guide to Food And Wine Pairing

Try Local Entertainment

Try to find local artists who can perform at your engagement party. There are many talented people out there who genuinely wish to be heard. They need a platform so give them a chance.

If you want to cut your budget even more, simply share your best playlist and opt for some light music. It will give your party a personal touch and keep the mood upbeat throughout the time. You can also request some of your close friends or family members to set the pace.

Invite Wisely

Always remember that this party is just an engagement party and not your wedding. So, you don’t need to invite everyone. Keep the extra ones on the list of wedding guests.

Make your engagement exclusive for your near and dear ones. Keep it more intimate and throw a small party. This step alone can literally cut your cost a lot.

If you invite wisely, you can even spare a few more bucks for decorations, wine, and food. Don’t forget to invite fun people who judge less and dance more.

Pick an Inexpensive Place to Throw the Party

engagement party on budget

A restaurant or farmhouse is definitely one of your best choices to throw a party. But if you really want to cut the cost, then try having a cozy party in your home or backyard. This way, you can save the entire budget of the place. You don’t need to pay the rent, allowing you to utilize that amount in other activities.

These are some of the best tricks you can apply to make an engagement party on a budget possible. If you have any other ideas, you can share them here with us. Let us know and help other people plan their engagement party.

The post How to Plan a Simple Engagement Party On a Budget appeared first on Dumb Little Man.

3 Ways to Reduce Customer Acquisition Costs

Have you ever stopped to think how much it costs to get a person to buy one of your products?

Then you’re in the right place.

Customers come with a price tag called customer acquisition cost (CAC), and it’s one of the most important pieces of information for business owners who want to get more customers without breaking their marketing budget.

So, how do you get more customers without breaking the bank? We’ve broken things down into three categories:

  1. Streamline your customer’s shopping process
  2. Optimize your marketing tactics
  3. Embrace customer relationship management

Let’s dive right in!

What is customer acquisition cost?

Your customer acquisition cost is defined as how much it costs your business to attract a new customer.

How to calculate customer acquisition cost

reduce customer acquisition cost

CAC is calculated by adding up all your marketing and sales costs and dividing them by the number of new customers acquired for a certain period of time. Here’s the formula:

customer acquisiition cost

For example:

Let’s say you spent $5,000 on marketing and sales expenses this October. That same month, you got 1,000 new customers (meaning only customers that have never previously visited or made a transaction at your store).

Sum of all marketing and sales expenses = $5,000.00
Total newly acquired customers = 1,000
CAC = $5

In this example, it costs you $5 to acquire a new customer.

The next question you should ask is “what is my average transaction value?” If your point of sale system’s sales reports tell you that your average transaction value (ATV) for October is under $5, that means you’re effectively spending more than you’re making per sale. Not good. Your ATV should ideally be higher than your CAC.

How to reduce customer acquisition cost

Let’s say you fall into the above category: Your CAC is higher than your ATV. How do you lower your CAC?

Streamline your customer’s shopping experience

A great way to lower your acquisition cost? Remove as many barriers to purchase as possible.

Make it easy for customers to find and buy what they’re looking for either in your store or on your website. The easier it is for them to find and complete a purchase, the more transactions your store stands to make (that’s why online vendors are developing one-click to purchase technology).

The same can be said for brick-and-mortar transactions: Every retailer’s goal should be to remove as many friction points from their purchasing process as possible.

Imagine being a customer ready to buy something, only to find yourself in a lengthy lineup to pay. Most customers will abandon their purchase entirely if the wait time is too long. Research from Irisys found that Americans will leave a checkout line after waiting just six minutes.

The best way to stop losing sales from long checkout lineups? Eliminate them altogether.

Barbara Thau, a contributing writer for Forbes, suggests that brick-and-mortar retailers “banish the wait in line, once and for all” to avoid losing sales.

A cloud-based point of sale effectively removes the need for lineups and traditional cash registers. Sales associates can ring up sales from anywhere in the store and accept any type of payment. Only If the transaction is in cash do you need to move the transaction to your cash register, but consumers are using cash less and less these days.

If you want to increase your average transaction value, we suggest refreshing your store merchandising and point of purchase displays to cross-sell more items. For a deeper look into how you can increase in-store sales, check out a list that Lightspeed curated with other retail experts, How to Increase Retail Sales – 11 Tips.

Make your business easy to find online by local customers

reducing customer acquisition cost

The next step is to get more customers to find your store or website for free. To do this, we suggest doing the following:

  • Create a Google My Business (GMB) profile
  • Include your store’s contact information on its Facebook and Instagram Business Profile
  • Use the right keywords to describe your business on your Facebook and Instagram Business Profile

The concept here is simple: focus your marketing on people that live close to your business. If they can find you online, see your inventory and get directions fast, the likelihood of them paying you a visit increases substantially.

That’s why we created a step-by-step guide to creating a GMB profile and optimizing your business’s Facebook and Instagram profiles so that you get found online by more local customers entirely for free. With a little work, you can attract customers for $0.

Embrace customer relationship management

If you consistently have what customers are looking for in stock and your customer service is personalized, friendly and helpful, customers are likely to come back to your store again and again.

The more they come, the more they buy. Commonly known as customer lifetime value (CLV), the metric looks at the estimated revenue you make from a customer over the duration of their relationship with the company.

We mentioned ATV earlier, you can think of this as a micro view of your sales. CLV, on the other hand, is the macro view—the big picture.

In an ideal world, you want a 3:1 CLV to CAC ratio. In a nutshell, this means that you generate three times more revenue from a customer than what it cost you to acquire them.

But how do you achieve that ratio? In part, by leveraging loyalty programs, referral programs and customer retention.

Loyalty programs

A loyalty rewards program incentivizes members to make more purchases, eventually getting points they can exchange for exclusive rewards. In a nutshell, it motivates repeat visits and purchases. The more purchases they make, the more points they get to exchange for exclusive offers, promotions and gifts.

For the retailer, the loyalty program helps grow their CLV. It’s a win-win scenario.

See Also: Will Your Customers Buy From You Tomorrow?

Referral Programs

Your existing customers are your store’s biggest brand ambassadors. If they’re happy, they’re more likely to recommend your store to friends.

Believe it or not, brand ambassadors and referrals are one of the most effective ways to bring in new customers. 77% of customers are likely to buy from a business that they’re introduced to by friends.

Rather than sinking tons of cash into marketing to acquire customers, the most cost-effective (and financially sustainable) way to acquire new customers is for your happy customers to spread the word and recommend your business for you.

It’s an authentic trust signal that marketing alone simply can’t replicate.

Consider incentivizing your customers to refer your business to friends and family. For every customer they refer, they get more points they can use as part of your rewards program.

Customer retention

Did you know that it’s up to 25 times more expensive to acquire a new customer than to retain an existing one?

This means one thing: If you focus on keeping your existing customers happy (happy enough to recommend your store to friends), you can get them to find new customers for you. It’s cheaper and more effective.

Want to know what your business’s current customer retention rate is? Just use this formula:

customer retention rate

Retaining customers brings in a ton of ROI:

  • Affordable: It’s five to 25 times more expensive to acquire a new customer than it is to retain an existing customer. (HBR)
  • ROI: Just a 5% increase in customer retention can increase a company’s revenue by 25-95%. (HBR)
  • Loyalty: Retained customers buy more often and spend more than newer customers (maybe in part to the loyalty and rewards programs they offer). (American Express)
  • Referrals: Satisfied, loyal customers are more likely to refer their friends and family—bringing in new customers, without having to spend anything on marketing. (American Express)

See Also: 12 Tips That Build Customer Loyalty And Boost Sales

Improve your customer acquisition cost

Improving your customer acquisition cost is a process that should start from the inside out.

Before you focus on finding new customers and launching fancy marketing campaigns, you need to make your existing customers happy. When your customers are happy, they’ll voluntarily recommend your business to friends and family. Your customers turn into brand evangelists; walking trust signals that find new customers for you, free of charge.

The next step is increasing your customer’s lifetime value. With Loyalty and referral programs, you can increase how much your customers spend in store and achieve that coveted 3:1 CLV to CAC ratio we mentioned earlier in the post.

But it all starts with customer happiness. When customers are happy, businesses don’t need to spend as much on marketing to convince people that their shop is worth going to and spending their hard earned money.

The post 3 Ways to Reduce Customer Acquisition Costs appeared first on Dumb Little Man.

Personal Loan vs Credit Card vs Debit Card: When to Use Each

You’re working hard every day to provide for your family and you’ve got a steady source of income. Frankly, you know you’re doing everything you can to get by, but you’ve also got personal necessities to buy, a pantry to restock, and hungry mouths to feed. The bills just keep piling up every month!

When is the best time to get a personal loan, swipe a credit card or use a debit card to consolidate debt? How do you manage your finances without hurting your pocket too much?

Understanding the differences among these three options will help you confidently manage your expenses and become more financially literate.

Choosing whether to get a personal loan or credit card depends on your spending habits, the status of your credit score, the amount of money you need, and the time it will take for you to repay the debt.

For instance, your credit score highly influences your chances of loans, credit cards, or mortgages getting accepted. It reflects how likely you are to pay back your loan or credit within a certain period. If your credit score is high, your credit card or loan application will likely be approved.

Below is a look at the differences between personal loan, credit card, and debit card, as well as when you can use each of them.

Personal Loan or Credit Card

Getting a credit card sounds like taking out a personal loan. Both types allow you to borrow money and pay it back in a certain period.

You can pay a personal loan in installments. You receive the whole amount and then make fixed monthly payments for a specific period. It can take anytime from 12 months to five years.

Lenders that provide personal loans generally place interest rates that range from 6% to 36%. Borrowers with good credit score, however, may qualify for lower interest rates. The limits of a personal loan can be up to $100,000, depending on the borrower’s credit score.

Meanwhile, a credit card is a revolving form of credit that allows the owner to repeatedly access funds. Unlike a lump sum of cash, a credit card has a credit limit you must abide by. If you choose not to pay it back immediately, you will begin to carry a balance.

The minimum amount of monthly payments is about 2% of the balance. However, if you pay back the credit in full on or before the due date, you can avoid getting charged with interest rates.

The difference here is that a personal loan is a better option for financing a large expense or settling high-interest debts while a credit card is good to use for smaller expenses. A personal loan is a fixed loan that you need to pay back in equal installments for a certain period, while a credit card is a line of credit that you can borrow from at any time. It needs to stay within the credit limit.

When to Choose a Personal Loan

When should you choose to get a personal loan?

If you need to finance large expenses or pay off debts, choosing a debt consolidation loan with fixed payments is the best option. It will even be better if you can get a lower rate on the loan than the rate for the existing debt.

What makes personal loans a good option for borrowing money is that interest rates are low and borrowing amounts can be high, with fixed repayment terms. The rate you receive will depend on your credit score. Your credit history, income, and debt-to-income ratio will also be assessed by lenders.

See Also: Personal Loan Approved? Here’s What To Do Next!

When to Choose a Credit Card

credit card

If you need to pay off a smaller amount of debt, a credit card is the best option for you. Since credit cards have higher rates and risks of carrying a high balance, they are best used for short-term purchases that you can pay off in full. This can include daily expenses and monthly bills for gadgets, appliances or furniture.

With credit cards, you can max-out your credit limit, which could keep you stuck in debt. On the other hand, with personal loans, you can be certain that your balance is at a fixed amount. You can’t keep borrowing money unless you’ve already paid off your loan.

See Also: 9 Valuable Credit Card Perks

Credit Card vs Debit Card

What’s the difference between credit and debit? Both debit cards and credit cards are accepted when purchasing in-store and online and they both offer the same convenience. However, the difference between these two cards is the source of the funds.

A debit card is connected to a checking account or savings account. It usually requires a PIN number or signature for every transaction.

When you make a purchase, debit cards draw money directly from your account and place a hold on the amount you purchase. The merchant sends the amount you bought to their bank and it is then transferred to their bank account.

Some people may argue that it’s best to use a credit card because of the credit card reward programs. However, this could only work if you pay off the balance in full every month. If you don’t, whatever amount you borrow will incur interest charges and fees.

Still, using a credit card has its benefits. A credit card is safer to use for online transactions than debit cards because it offers more protection against unauthorized transactions. When travelling, it’s also best to use a credit card for bookings, flights, and hotel accommodations. You could even enjoy travel perks such as air miles, travel assistance, travel insurance, and airport lounge access.

When to Use a Debit Card

debit card

If you want to keep your finances in check, it’s best to use a debit card. To make sure that you don’t overdraw your checking account, it’s better to keep a record of your running balance. A debit card isn’t advisable to use when traveling because you may end up short of money for your daily expenses. However, it’s the best option to use when buying small purchases like medicine or groceries.

Whichever of these three options you choose, it’s important to avoid drowning in credit card debt or else, you might experience financial ruin. With that, a debit card with limited balance can help you develop financial discipline and curb bad spending habits. With a debit card, you won’t be spending money that you do not have.

The post Personal Loan vs Credit Card vs Debit Card: When to Use Each appeared first on Dumb Little Man.

Simple Money Hacks That Every Millennial Needs To Know

If the media reports, editorials, and advice columns are to be believed, millennials can leave a lot to be desired when it comes to saving and spending money wisely. Living in the moment isn’t such a bad idea when those moments are fast running out! However, using ‘treat yourself’ as an excuse to indulge also isn’t all that great for our bank accounts.

With many of us held captive to large student loans and ever-increasing living costs, it isn’t uncommon to find ourselves with $5 left in our bank accounts at the end of the week and with little to show for it. If this sounds all too familiar, chances are you could use a few simple money hacks to help you turn your finances around.

Let’s get started with these money management tips for millennials.

Look At Your Bank Statements

Do you know where all of your money is going each week? There’s a good chance you don’t. Spending a little here and there may seem harmless — until you’ve spent $500 over the last six months on cute outfits for your dog.

Taking a look at your bank statement might seem scary, but it will help you identify exactly where your spending is going wrong and where you could be saving a little each month. Grab your last few bank statements and a highlighter and start marking everything that isn’t a necessity.

And no, expensive coffees, dining out or going to see live music are not necessities.

Necessities include expenses like groceries, rent, utilities, and fuel. Reduce your highlighted expenses to a few treats a month and save the rest.

Be Responsible With Installment-Based Payment Plans

money management tips for millennial

Laybuy, Afterpay, and other “Shop now, pay later!” payment options make it all too easy to make spur-of-the-moment purchases. While they’re a fantastic convenience, they also tempt you into buying things you wouldn’t buy usually if you had to pay a lump sum or save up.

Upfront payment is always the best option. As my grandparents used to tell me, “Don’t buy something unless you can pay cash for it”. This can prevent you from spending outside your means.

And if you do choose to use one of these options?

At least be responsible with it and limit the number of items you have on a plan at any given time.

Keep Track Of Your Subscriptions

There’s no doubt that most of us have signed up for a subscription service and found ourselves hardly using it. Or, for that matter, signed up for one of those super enticing “First 30 Days Free!” offers and forgotten to unsubscribe.

Cancelling any subscriptions that you no longer use is a great way to save a little extra. Not sure if you’re getting your money’s worth?

Take the monthly cost of the service and divide this by the amount of times you use it per month. If the cost-per-use is pretty high, then unsubscribing is a safe bet.

Write Out Your Financial Goals

It may sound cheesy, but writing out your financial goals can help keep you accountable. It’s a great way to drive you to work towards your goals, whether that’s buying your first home, vehicle or saving for a new piece of technology.

Here are a few examples of how to make saving for large items easy.

  • A $20,000 car every 10 years? Save $38 a week.
  • A $2,500 laptop every 4 years? Save $12 a week.
  • A $1,800 iPhone every 2 years? Save $17 a week.

Setting money aside for big-ticket items you know you’ll need will leave you feeling prepared.

See Also: How to Stick to your Financial New Year’s Resolution

Accumulate An Emergency Fund

Millennials, listen up. I hate to be the bearer of bad news, but savings and an emergency fund are not the same thing. I only learned this recently myself!

An emergency fund is separate from your savings. It’s mean to be used to cover medical expenses, family responsibilities, or – as is becoming increasingly common – job loss.

Your emergency fund should ideally consist of 3 to 6 months worth of income so that you can keep your head above water during a financial emergency or unforeseen circumstances.

Save For Retirement

money management tip for millennial

 

Yeah, I said it.

Whether you are busy saving for a new car, a pair of shoes, or a home, retirement isn’t getting any further away. The best way to tackle retirement savings is to start setting some money aside each month and make the most of any retirement saving schemes offered by your government. They’ll often include added bonuses and contributions to incentivise the savings process.

Building Your Savings Doesn’t Have To Be Difficult

Learning to separate necessities from luxuries is an important step in not only being able to save money, but also to pay off personal and student loans and credit cards while also being able to put money aside for the future.

As a millennial myself, I know the influence of social media. The seemingly perfect lives of Instagram influencers or Facebook friends can leave you feeling like you’re struggling to keep up. But remember, “If you live fake rich now, you’ll live real poor later.”

Start working on these money management tips for millennials and have peace of mind when it comes to your future.

The post Simple Money Hacks That Every Millennial Needs To Know appeared first on Dumb Little Man.

How to Get A Short-Term Business Loan

Are you a smart businessman? Do you have what it takes to take bold decisions when your company faces the music? Are you aware of the regulations and policies of the top lenders? Do you know how to get a short-term business loan?

If your response is affirmative to the above questions, you know how to sail your company’s ship out of the troubled waters like a champion captain.

Now, before you go ahead and set a meeting with your lender, you must first know your primary purpose.

Basically, such a loan is usually obtained by small businesses when they are in an urgent need of cash. It could either be due to the need for a bigger space to  store your products or fit your growing workforce. They also come across situations where they need extra cash to purchase resources for a big order from a special client.

Such challenges can test an entrepreneur’s ability to handle the pressures of the business world.

Although a short-term business loan can save the day, business owners must repay the loan within 18 months or one and a half years.

Now that you have understood what a short-term business loan is, let’s look into how to qualify for one.

Maintain a Good Credit Score

It all starts with your credit score or the record of your bill payments.

A lender needs to know the status of your finances and how responsible you are in dealing with your debts. If you are able to maintain a clean and reputable credit history, your credit score would allow you to look for different sorts of financing options.

Always keep in mind that lenders check your personal credit score in addition to your business one. It is important because personal debts and mortgages often create problems in the repayment of loans.

This way, your lender will have a 360-degree view of your finances like your credits, debits, and years of business before offering you a loan.

Meet the Minimum Requirements

get a short term business loan

It is essential to know that getting a loan is a two-way deal. You must be equally indulgent and cautious about the whole process as much as your lender is.

If the lender asks for your financial information and reviews your accounts, then it is necessary for you to do your own research as well. Even before approaching a lender, it is wise to carry out research to make things easier and more transparent for you.

You should look into their mission statements and understand the requirements that should be met to get a loan approved. Having all proofs and documents ready will impress your prospective lender. It will make it easier to meet their standards and increase your chances of getting approved.

Get Your Testimonies Ready

Getting a loan is a hectic process. Sometimes, it can take months of rigorous hard work to complete it and a delay in the process can deliver a severe blow to your business.

As a smart entrepreneur, you should be prepared. Before even applying for a short-term loan, make sure that you have read its details and requirements.

Your next task is to collect the necessary documents, like personal and business balance sheets, leases, and bank statements. It will not only improve your loan application’s chances for approval, but will also save your precious time.

The quicker you arrange the required paperwork, the earlier you are going to have an access to that pile of cash for your business.

Make Your Business Strong

short term business loan

The status and prospects of your business are of great interest to the lenders. No lender would want to engage its money in a business that is not doing well. Things may become even gloomy if your company has no future business plan or if it has a flimsy business structure.

You need to have a robust and proactive approach in your business. You must have a detailed picture of where your business started from, where it is now, and where will it stand in the future.

Make sure that your business plan is free from any discrepancies or shady areas. It must be strong and articulate for the lender. Don’t forget to include your company’s origin, background, mission, and vision statement.

It should mention your product or service description. It would be a great idea to also make an industrial analysis, relevant market research, and a SWOT (Strengths, Weaknesses, Opportunities, and Threats) for your business. These things will make your lender well-informed and impressed with your efforts.

See Also: 5 Ways Business Investment Loans Can Help Your Start-Up

Final Thoughts

Securing a short-term business loan is quite convenient if you know your business and you’re willing to go the distance to inspire its growth. A suitable lender will see through your hard work and reward it with a prompt loan — and with leniency and a lower interest rate.

You have to believe in your business and pitch the idea to your lender with real dedication and conviction. Do not laze around or delay the process. Be active.

In fact, you need to be proactive in both receiving and returning the loan. If you have the qualities mentioned earlier in your business, you will have a short-term business loan approved in no or little time.

See Also: What Are The Advantages Of Business Consolidation Loans?

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Did The Gig Economy Jump The Shark?

Is the gig economy working and thriving?

The gig economy came on strong at a time in American history when people needed to be able to onboard quickly and start making money immediately. The country was deep in the grips of The Great Recession and people were losing jobs and homes left and right. The idea of driving people around in your own car for money didn’t seem all that crazy.

And back then, the money was actually pretty good.

These days, gig drivers have seen wages fall by more than half since 2014 and it’s not just gig driving jobs that are seeing turnover rates of more than 500% per year. As the economy strengthens and people are able to find more steady employment that includes the benefits they need to live, the gig economy is starting to show signs of jumping the shark.

Where Did The Gig Economy Come From?

gig economy working

During the Great Recession, unemployment rose to 7.2% and many people struggled to get back into the workforce right away. This is due to the higher numbers of applicants that went out for the same small pool of jobs.

At the same time, tech was being developed to hire and manage independent contractors to do things that didn’t require companies to own any property or employ any workers. It included things like ridesharing and home-sharing.

With an app, you could suddenly rent out your spare room like a hotel or drive people around like a taxi. It seemed like the perfect stopgap move for people struggling to find full-time employment and the money was worth the effort — at least at first.

What Happened To The Gig Economy?

As these jobs became more popular and more people were competing for them, wages fell. Municipalities began to question the legality of such employment situations, with some outright banning the services due to concerns about worker protection and even public safety.

As wages continued to fall, people began to realize that when they factored in the cost of wear and tear and fuel for their cars, they actually weren’t even making minimum wage in some cases.

As a result, some people tried to unionize while turnover skyrocketed to 500% for some companies. Today, 60% of gig workers can’t come up with $400 for an emergency.

The Gig Economy Is Still Struggling

the gig economy working

As this option becomes less appealing as a full-time job and people are reverting back to using the gig economy as a side hustle, incomes have dropped off sharply. Median monthly incomes for gig economy sectors are:

  • $793 non-transportation
  • 762 transportation
  • $534 selling

The number of full-time gig workers dropped from 16.2 million to 15.8 million between 2014 and 2018, but the number of part-time gig workers rose from 12.9 million in 2017 to 14.9 million in 2018. People are relying less on the gig economy to provide them with full-time work and a living wage and more to provide a part-time, short-term gig to help get them out of a pickle when they need it.

The U.S. Department of Labor ruled that gig workers are not employees. Therefore, they are not entitled to minimum wage protections or normal employment benefits such as health insurance. Most workers are flocking to more traditional forms of employment, but employers are increasingly seeking gig workers to do jobs in more flexible arrangements.

As of 2016, one in six organizations had at least 30% of contingent workers in its workforce, signaling a shift in the parameters of traditional roles. Meanwhile, gig companies like Uber are trying out benefits like free college tuition for top drivers, though this is doing little to stave off unionization efforts.

See Also: GenZ and Money: How GenZ Faces Their Financial Fears

Is It Completely Doomed?

As with all new things, the gig economy is going through growing pains trying to find its place in the world. There are some people who benefit from being able to start and change jobs quickly and set their own hours and who don’t necessarily need all the perks that come along with doing a particular job.

As the gig economy grows up, these will be the people who power it, while others will move back into more traditional working arrangements as the economy strengthens. Learn more about the future of the gig economy from the infographic below.
Gig Jobs
Source: Online Schools Center

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Filing Chapter 7 Bankruptcy: The Pros and Cons You Need to Know

Nobody in this busy world wants to file for bankruptcy. However, if debt settlement and negotiation are not sufficient to resolve your financial crisis, then you may have no other option.

Calling bankruptcy implies that you have come to the end of your financial rope and have no means to pay your existing debts like car loans. For people facing overwhelming debt because of buying a car, filing for chapter 7 bankruptcy is regarded as one of the few means to initiate a bankruptcy fresh start program, erasing the obligation to repay and giving you a chance to get on with your life.

The decision to file for chapter 7 bankruptcy is a big one and it has its pros and cons, which you need to pay attention to.

Generally, a debtor can select to file for either a chapter 7 bankruptcy or a chapter 13 bankruptcy. But mostly, all individuals file bankruptcy under Chapter 7. It is referred to as a ‘liquidation bankruptcy’ because it involves a gathering of the property and assets and selling them to pay off as much as debt as probable before the remaining debt is discharged.

Ultimately, you can erase your debt with a chapter 7 bankruptcy or even create a repayment plan with chapter 13 bankruptcy when you’re planning to opt for a car loan.

Real Examples of Chapter 7 Bankruptcy

Example 1:

Mia is a retired educator on a fixed income. She decided to sell her home before moving in with her daughter. She had great credit score because of on-time payments on her mortgage and she never had debt. Later, she agreed to co-sign on a home loan for her granddaughter and a car loan for her grandson. Well, she couldn’t say no!

But 2.5 years later, the house was repossessed when the granddaughter had a divorce. The grandson’s car was repossessed after he lost his job. A substantial amount of debt was remaining after the house and the car was sold at an auction.

Mia, in critical health, was cornered by creditors. She filed a Chapter 7 bankruptcy which stopped the harassment and rejected the deficiency claims. Her social security and retirement money were ultimately excused and protected.

Take note that if you file for Chapter 7 bankruptcy while paying off a vehicle loan, you’ll need to decide whether or not you’d keep the vehicle.

If you decide to surrender the vehicle, you’ll have to forfeit the sum you’ve paid toward the loan. Nevertheless, the creditor won’t be able to sue you for the balance once the vehicle is sold at the auction.

Pros and Cons of Chapter 7

Declaring for chapter 7 bankruptcy may seem like an amazing idea. It can relieve your debt and offers a chance to rebuild and get a fresh start. Nevertheless, you should definitely also be aware of the upsides and downsides of it.

Upsides

chapter 7 bankruptcy

Bankruptcy is common: There’s nothing to be embarrassed about bankruptcy. It’s quite common and, honestly, the best option in various scenarios. Businesses have a downfall and credit cards spiral as the interest rates increase. Even Donald Trump has filed bankruptcy.

Makes you financially disciplined: If you ever plan to buy a car again, you will require to be economical and accountable about debt. You’ll be able to demonstrate perfect ability to pay those car loans on time even though there might be open lines of credit in the later future.

Eliminate credit card debt: That’s a big one. Credit card use is a common cause of declaring bankruptcy. Individuals often pay off vehicle loans with credit cards when cash isn’t readily available, and debt gradually snowballs from there. Filing for chapter 7 bankruptcy permits you to start fresh without credit card car debt.

See Also: How to Get Out of Credit Card Debt Fast

No effect on your wages: Wage garnishment happens when lenders have a court order that permits for a part of your pay check to get sent to your lenders. However, when you apply for Chapter 7 bankruptcy, it will stop from happening. It can, at the end of the day, improve your income as you’ll be able to keep the money you worked hard for. This doesn’t work in cases of student loans, child support, and taxes.

Downsides

file chapter 7 bankruptcy

A downfall for credit score: Credit rating can be severely damaged when you file for chapter 7 bankruptcy. It lowers the score by 200-250 points, which stays on till 7-10 years. This can make it quite difficult for you to qualify for fresh car loans and credit for nearly 3-4 years.

Won’t erase student loans: Student loans for buying a car cannot be erased with bankruptcy. If it is your debt, then you’ll definitely be on the hook to pay it. However, it prevents creditors from taking aggressive collective action which absolutely helps. Proving that your student vehicle loans are too much of a liability is a very tough task. It mostly requires a separate lawsuit and an attorney.

See Also: 5 Strategies For Paying Off Student Loans Fast

Loss of expensive property: In the process of filing, you will most likely lose some of your assets, especially extraneous luxury items including all sorts of cars. These goods are used in repaying your creditors and depending on your state’s exemption laws, you might be required to give up on material things that you’d rather not.

Six-year filing: Chapter 7 bankruptcy can only be filed every six years. This encourages all those who recently filed bankruptcy to keep their head above the water and be attentive.

Final Thoughts

We would just like to make you aware that the most significant thing is to analyze your own personal financial situation. Compare consumer car debt solutions in order to select the best resolution for your financial situation.

If you have nominal assets and merely require a fresh start, then chapter 7 can definitely help you.

But if you think that your situation is a bit more complex, then it can still be significant for your financial situation. It’s vital to get direction on whether chapter 7 or chapter 13 would be the right option for you. While our brief list of pros and cons may be helpful to you when it comes to opting for car loans, it’s honestly just the beginning.

The post Filing Chapter 7 Bankruptcy: The Pros and Cons You Need to Know appeared first on Dumb Little Man.

China’s Transsion and Kenya’s Wapi Capital partner on Africa fund

Chinese mobile-phone and device maker Transsion is teaming up with Kenya’s Wapi Capital to source and fund early-stage African fintech startups.

Headquartered in Shenzhen, Transsion is a top-seller of smartphones in Africa that recently confirmed its imminent IPO.

Wapi Capital is the venture fund of Kenyan fintech startup Wapi Pay—a Nairobi based company that facilitates digital payments between African and Asia via mobile money or bank accounts.

Investments for the new partnership will come from Transsion’s Future Hub, an incubator and seed fund for African startups opened by Transsion in 2019.

Starting September 2019, Transsion will work with Wapi Capital to select early-stage African fintech companies for equity-based investments of up to $100,000, Transsion Future Hub Senior Investor Laura Li told TechCrunch via email.

Wapi Capital won’t contribute funds to Transsion’s Africa investments, but will help determine the viability and scale of the startups, including due diligence and deal flow, according to Wapi Pay co-founder Eddie Ndichu.

Wapi Pay and Transsion Future Hub will consider ventures from all 54 African countries and interested startups can reach out directly to either organization, Ndichu and Li confirmed.

The Wapi Capital fintech partnership is not Transsion’s sole VC focus in Africa. Though an exact fund size hasn’t been disclosed, the Transsion Future Hub will also make startup investments on the continent in adtech, fintech, e-commerce, logistics, and media and entertainment, according to Li.

Transsion Future Hub’s existing portfolio includes Africa focused browser company Phoenix, content aggregator Scoop, and music service Boomplay.

Wapi Capital adds to the list of African located and run venture funds—which have been growing in recent years—according to a 2018 study by TechCrunch and Crunchbase. Wapi Capital will also start making its own investments and is looking to raise $1 million this year and $10 million over the next three years, according to Ndichu, who co-founded the fund and Wapi Pay with his twin brother Paul.

Transsion’s commitment to African startup investments comes as the company is on the verge of listing on China’s new Nasdaq-style STAR Market tech exchange. Transsion confirmed to TechCrunch this month the IPO is in process and that it could raise up to 3 billion yuan (or $426 million).

Transsion sold 124 million phones globally in 2018, per company data. In Africa, Transsion holds 54% of the feature phone market — through its brands Tecno, Infinix and Itel — and in smartphone sales is second to Samsung and before Huawei, according to International Data Corporation stats.

Transsion has R&D centers in Nigeria and Kenya and its sales network in Africa includes retail shops in Nigeria, Kenya, Tanzania, Ethiopia and Egypt. The company also has a manufacturing facility in Ethiopia.

Transsion’s move into venture investing tracks greater influence from China in African tech.

China’s engagement with African startups has been light compared to China’s deal-making on infrastructure and commodities.

Transsion’s Wapi Pay partnership is the second recent event — after Chinese owned Opera’s big venture spending in Nigeria — to reflect greater Chinese influence and investment in the continent’s digital scene.

 

 

 

 

 

 

 

Bitcoin Trading Platform: What Exactly to Look for

The cryptocurrency market has grown exponentially over the past five years, with many people interested in the emergence of a virtual currency which isn’t controlled by a central authority (government) & has the potential to gain massive value over a minimal amount of time. But, the bitcoin market is very volatile and it can be very tough to keep up with the trend – especially since this kind of market never sleeps.

To make it easier for traders, trading bots and platforms have been created. A trading platform or bot refers to a specific software program that has been especially designed to handle financial exchanges effectively & efficiently (much better than a human being) and allows any relevant information to be collected and interpreted automatically so that market orders can be easily bought and sold on behalf of the trader.

Essentially the bots make the final trading decision through intensive monitoring of market prices and using some preset rules, so that any losses can be prevented. The system will analyze the market for any changes in terms of volume, pricing and orders before it makes a decision, so if you are a bitcoin trader you may want to find the best trading platform to make the process easier for you.

Ultimately, the question now is how exactly do you know which one is the best?

The Operating System

bitcoin trading

Remember, not all platforms are made for all traders as their operating systems can vary. Because of this, you want to have a platform that will work on all kinds of operating systems such as Mac, Windows, or Linux. It should work on your device to fully take advantage of its usability and features. With all of your orders and configurations stored in a USB, all you need is to plug it in and play it on any computing device to trade – regardless of the operating system. A platform that requires installation only on a compatible system is inconvenient for any trader.

Easily customized and user-friendly

The overall interface of an excellent bitcoin trading platform must be very easily customized and user-friendly. Anyone should be able to use it without the very technical details or any programming knowledge. All necessary information must be easy to navigate and the gains shown very clearly along with the rest of the other trading information, as this will make it easier for any bitcoin trader to buy and sell orders. All you have to do is merely input your pairs as well as numbers, and voila! You can start trading with just a few clicks of a mouse.

Supports coins, pairs, and any other exchange

bitcoin trading currency

Aside from bitcoin, you must be able to trade in different pairs, currencies, and other various exchanges. It can be thus helpful to look for a trading platform that can accommodate various coins provided in major exchanges around the world. A full stacked cryptocurrency platform will work best for any spontaneous and eager trader.

Various other bitcoin trading platform features that can be useful and practical are reporting, notifications, historical data & real-time backtesting, just to name a few. Find out what a specific trading platform can do and choose the best one that suits your needs now.

See Also: What The World’s Governments Think Of The Expansion Of Cryptocurrency

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The Cost of Email Phishing

When did email become the weakest link? How can you protect your organization from email phishing attacks?

There have always been problems with people clicking on malicious links and somehow having them sent directly to you seems to make it more likely you will click on it.

One out of every 99 emails is a phishing scam which means that every employee in your organization is getting almost 5 phishing emails every workweek. Unfortunately, most people rely on their email program to filter out such messages.

Phishing Attacks Are Very Common — And Very Costly

Almost a third of phishing emails make it past default email security and 5% of those have been whitelisted by a system admin. There are several very common forms of phishing attacks:

  • 41% are credentialing attacks in which hackers try to gain access to the target’s usernames and passwords, costing $400 per account to clean up.
  • 51% of attacks are links that prompt the download of malware which can cause an average of $2.4 million in damage when successful
  • 0.4% of attacks are spearphishing attacks in which high-level people in an organization are targeted. While these are the least common attacks, they can be the most expensive, averaging $7.2 million per incident.
  • 8% of attacks are extortion attempts and when they are successful, they can cost an average of $5,000 per user.

Last year, 64% of information security professionals were targeted by spearphishing attacks while 35% of working professionals don’t even know what a phishing attack means. The cost of phishing comes in more than cleanup – it can also do serious reputational damage.

The average cost of a phishing attack on a midsized business is $1.6 million. There’s lost productivity while everyone tries to halt and undo the damage. There’s also a loss of proprietary data and perhaps the worst of all is the damage to a company’s reputation after a breach. A third of consumers will stop using a business once a breach has occurred and it could take years to recover from such an incident.

It’s Entirely Too Easy To Fall For The Bait

phishing attack

Even if you are in the 65% of working professionals who know what a phishing attack is, it’s still very easy to fall victim. Successful phishing campaigns play to our emotions and sense of urgency. They often feature subject lines designed to scare or cajole us into action.

Subject lines such as “complaint filed” or “open enrollment” make us believe there’s an action that needs to be taken immediately or something bad might happen. It may include losing our family’s health insurance or getting fired from our jobs.

It also doesn’t help that a quarter of phishing emails spoof trusted brands. When you are expecting a package from Amazon and happen to get an email from Amazon in your inbox, it might seem believable enough that you open it to see what’s going on.

The most common signs of phishing include:

  • Address of a crypto wallet
  • Link to a WordPress site
  • BCC to many others
  • Shortened URLs
  • From a trusted brand
  • Link to a file on Google Drive

Because these are all things that have legitimate uses, hackers can exploit them to make us think they are completely safe. Knowing the threat is the best way to avoid falling victim, but that may not be enough. If hackers weren’t so good at what they do, which is understanding human psychology, we would have no need for email scanning software.

It Helps To Have Backup

The existing spam filters in your email program catch a lot of the problems but not all of them. This lulls us into a false sense of security and leaves us believing that if something lands in our inboxes, it’s probably safe.

Unfortunately, this is just not the case. Learning how to avoid phishing attacks and schemes is crucial and it means reminding employees of these tactics on a regular basis. It can also help to get additional email scanning software to catch anything that looks real enough to be a threat.

Learn more about how email became the weakest link and how you can fight back from the infographic below.

How Email Became the Weakest Link [infographic]
Courtesy of Avanan

 

 

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Capital One’s breach was inevitable, because we did nothing after Equifax

Another day, another massive data breach.

This time it’s the financial giant and credit card issuer Capital One, which revealed on Monday a credit file breach affecting 100 million Americans and 6 million Canadians. Consumers and small businesses affected are those who obtained one of the company’s credit cards dating back to 2005.

That includes names, addresses, phone numbers, dates of birth, self-reported income and more credit card application data — including over 140,000 Social Security numbers in the U.S., and more than a million in Canada.

The FBI already has a suspect in custody. Seattle resident and software developer Paige A. Thompson, 33, was arrested and detained pending trial. She’s been accused of stealing data by breaching a web application firewall, which was supposed to protect it.

Sound familiar? It should. Just last week, credit rating giant Equifax settled for more than $575 million over a date breach it had — and hid from the public for several months — two years prior.

Why should we be surprised? Equifax faced zero fallout until its eventual fine. All talk, much bluster, but otherwise little action.

Equifax’s chief executive Richard Smith “retired” before he was fired, allowing him to keep his substantial pension packet. Lawmakers grilled the company but nothing happened. An investigation launched by the former head of the Consumer Financial Protection Bureau, the governmental body responsible for protecting consumers from fraud, declined to pursue the company. The FTC took its sweet time to issue its fine — which amounted to about 20% of the company’s annual revenue for 2018. For one of the most damaging breaches to the U.S. population since the breach of classified vetting files at the Office of Personnel Management in 2015, Equifax got off lightly.

Legislatively, nothing has changed. Equifax remains as much of a “victim” in the eyes of the law as it was before — technically, but much to the ire of the millions affected who were forced to freeze their credit as a result.

Mark Warner, a Democratic senator serving Virginia, along with his colleague since turned presidential candidate Elizabeth Warren, was tough on the company, calling for it to do more to protect consumer data. With his colleagues, he called on the credit agencies to face penalties to the top brass and extortionate fines to hold the companies accountable — and to send a message to others that they can’t play fast and loose with our data again.

But Congress didn’t bite. Warner told TechCrunch at the time that there was “a failure of the company, but also of lawmakers” for not taking action.

Lo and behold, it happened again. Without a congressional intervention, Capital One is likely to face largely the same rigmarole as Equifax did.

Blame the lawmakers all you want. They had their part to play in this. But fool us twice, shame on the credit companies for not properly taking action in the first place.

The Equifax incident should have sparked a fire under the credit giants. The breach was the canary in the coal mine. We watched and waited to see what would happen as the canary’s lifeless body emerged — but, much to the American public’s chagrin, no action came of it. The companies continued on with the mentality that “it could happen to us, but probably won’t.” It was always going to happen again unless there was something to force the companies to act.

Companies continue to vacuum up our data — knowingly and otherwise — and don’t do enough to protect it. As much as we can have laws to protect consumers from this happening again, these breaches will continue so long as the companies continue to collect our data and not take their data security responsibilities seriously.

We had an opportunity to stop these kinds of breaches from happening again, yet in the two years passed we’ve barely grappled with the basic concepts of internet security. All we have to show for it is a meager fine.

Thompson faces five years in prison and a fine of up to $250,000.

Everyone else faces just another major intrusion into their personal lives. Not at the hands of the hacker per se, but the companies that collect our data — with our consent and often without — and take far too many liberties with it.

How to Apply Good Financial Habits to the Rest of Your Life

It’s easy to see how having good money habits can make you feel better. More money in your pocket means you are able to go grocery shopping and get that fancy cheese, get your oil changed, and maybe shell out for another TV subscription.

However, you may not have considered the psychological and health impacts that having better money habits can have. If you create improved money management, it has an effect on lowering anxiety. It helps you get better sleep which boosts your immune system. The reverberations of one aspect of your life can deeply affect the rest.

With this idea in mind, you can take aspects of one part of your life that seem to be working and apply them (with some small variations) to the rest. In this way, it’s possible to use the lessons that keep your financials in order to address your life.

Lexington Law has compiled an infographic with over 20 ways to treat your life and finances similarly. Some of the most important lessons speak to issues like:

Don’t stretch yourself too thin

Overwork is just as dangerous as overspending. Don’t find yourself making time investments that your body can’t cash. Like credit card debt, sleep debt is a dangerous thing.

Proper rest, on the other hand, will build your life portfolio in many ways. You can get improved decision-making, immune system boosts, and a generally better outlook.

See Also: 10 Tips to Manage Your Time Effectively Under Pressure

Prioritize the future

Pure impulse purchases are bad for your finances and life. Even if you are generally not a planner, there are a number of things you can do to create good habits in this area.

Make a down payment on organizing

Organization guru Marie Kondo suggests ways to tidy up your life through her KonMari Method. The most important element of this is the first step: making a commitment.

Applying this to your finances means sitting down to make budgets and plan for your future. The same idea can be applied to your life:

Vision board it

retirement planning age

It might seem strange, but just the action of writing your goals down has a large impact on what you are actually able to accomplish. Something about the physical action of recording what you want in life, studies show, makes it up to 10 times more likely to happen.

Prioritize your time

Make a schedule and stick to it. If that means turning off your phone and getting rid of push notifications, do it. The myth of multitasking is that it helps you get more done, when in fact, the opposite is true.

By switching between tasks, you are actually wasting precious time. In fact, about 40% of your productivity can be lost when you try to multitask. And besides, you know it always ends up with you on social media!

To Do, To Done

Do you feel like making lists is taking up too much of your precious time?

The lists you make are more than just physical reminders of all the myriad tasks you have yet to perform. They are actually organizing strategies that have added benefits like helping you feel less anxious, get better sleep, and be more productive.

Don’t stop learning

It’s crucial to stay abreast of financial trends and that means always finding more ways to educate yourself. From a life perspective, accepting the idea that you should never stop learning is an imperative. Being a lifelong student is an important part of any journey.

Beyond the direct effect of learning a new skill or gaining new information, continuing to expand your mind will have you living longer and making more friends.

Habla Español?

Learning a new language does more than let you talk to people from other countries. Studies show it can also physically expand your mind and add to improved general cognition.

Make something

Doing something creative, like playing music or creating art, is more than just “art for art’s sake.” It’s a relaxing outlet and will also make you more creative in other areas of your life, too.

Take a continuing education class

There may be topics that can help you professionally or just something you’ve always wanted to know about. These classes keep your mind working and lead to a longer, more fulfilled life.

Let’s get physical

Financial wellness and physical health may not seem to have much in common, but just sitting down to assess your level of heath and making a commitment to better habits is an area where these two elements of life overlap.

Take time to exercise

We all know that exercise makes us feel better, but it has other benefits. Studies show more exercise leads to improved memory and is often correlated with higher salary.

Get out into nature

Yes, sunshine is pleasant and Vitamin D is good for your body. Spending time outside has also been shown to help you sleep, lower blood pressure, and increase your metabolism.

Having good money habits is sometimes not enough. There are a number of excellent reasons to start to think about your life the same way you might approach your finances.

The post How to Apply Good Financial Habits to the Rest of Your Life appeared first on Dumb Little Man.

Online catering marketplace ezCater gets another $150M at a $1.25B valuation

In 2007, Stefania Mallett and Briscoe Rodgers conceived of ezCater, an online marketplace for business catering, and began building the company in Mallet’s Boston home, mostly at her kitchen table.

Recently, sitting at that same table, Mallett negotiated with Brad Twohig of Lightspeed Venture Partners the final terms of a $150 million Series D-1 at a $1.25 billion valuation. Lightspeed, alongside GIC, co-led the round, with participation from Light Street Capital, Wellington Management, ICONIQ Capital and Quadrille Capital.

“Raising money or getting to unicorn status, it’s all nice validation but that’s not the purpose, the purpose of being in business is to grow a very successful company with happy customers and happy employees,” Mallett, ezCater’s chief executive officer, told TechCrunch. “We are going to have cupcakes with unicorns on them. That will take us about a half hour, then we will get back to work.”

EzCater co-founder and CEO Stefania Mallett

Mallett compares ezCater to Expedia . The travel company doesn’t own and operate hotels, nor do they create them. EzCater, similarly, works with 60,500 restaurants and caterers around the U.S. to fulfill orders, but at no point do they work directly with food nor make any deliveries themselves.

Since its inception, the ezCater marketplace has grown considerably, expanding 100 percent annually for the last eight years, Mallett tells us. Though, like most unicorns, ezCater isn’t profitable yet.

Both Mallett and Rodgers are software industry veterans, establishing engineering careers prior to tackling business catering. The pair bootstrapped the company until 2011, when they secured a small Series A investment of $2.7 million. That same year, U.S. foodtech startups raised $176 million, per PitchBook. EzCater would go on to raise more than $300 million in equity funding, including its latest round, and VC interest in foodtech would explode. Already this year, U.S. foodtech startups have brought in $626 million after pulling in a whopping $5 billion in 2018.

EzCater has benefited from this boom. The company raised a $100 million Series D just 10 months ago.

“We really didn’t need the money, we have quite a lot of money in the bank from the last round,” Mallett said. “There was so much talk of a funding winter and a recession coming so we said maybe we should try to raise money and then people jumped on it so we thought OK, why not? If there is a funding winter, we’re set; if not, well, we are still set.”

The investment comes hot off the heels of ezCater’s acquisition of Monkey Group, a cloud platform for take-out, delivery and catering. Mallett declined to disclose terms of the deal but said the partnership makes ezCater the indisputable market leader in catering management software. The company will use its recently expanded war chest to accelerate its international expansion and, potentially, continue its M&A streak. As for the future, an initial public offering is amongst the possibilities.

“We certainly are considering it,” Mallett said. “As we’ve grown, we’ve become more sophisticated and mature; that puts us in a good position to continue operating as a successful standalone company or be acquired by a public company or go public if we see an opportunity to do that. We are not wedded to any of these outcomes.”

5 Ways You Haven’t Considered to Save or Make Money

Everyone needs money to survive, to grow, and to have fun. And Google turns up with more than 9 billion pages if you search for “I need money”!

In the burgeoning gig economy, we have hundreds of opportunities to earn quick money by running errands, walking dogs, selling artwork, and doing freelance work. You already know about them.

In this article, we will talk about simple actionable tips and frugal living ideas.

Frugal eating does not mean unhealthy eating

Most students in college think eating on a budget means shopping at Dollar Tree or Family Dollar, eating Ramen noodles or peanut butter and honey sandwiches, and drinking energy drinks.

This is not what ‘frugal eating’ means.

The cost of eating unhealthy food is way more than what’s printed on the packaging. If you really want to save money on food, drink only water and buy generic and cheap items. Good examples are potatoes, dried beans, and legumes, eggs, sauce, spaghetti etc.

You might also consider exploring your local Asian and Mexican markets as they offer pretty good deals on buying staples, rice, spices, meat or produce in bulk.

A few simple recipes can save you a lot of time and money and keep you healthy.

See Also: 10 Cooking Tips For Beginners To Help You Master The Kitchen

Try online teaching

One edge that online tutoring assignments have is that it allows you to save up on transportation costs. Moreover, you can choose to teach at any time of the day.

3 easy steps to earn as an online tutor are:

● Register yourself as a tutor on a reputed online tutoring website
● Make a good profile and fill-up as many details as you can
● Take up teaching and assignment help gigs that suit your qualifications, skills, and interest areas.

If you want to teach at odd hours, try teaching international students. It will help you widen your scope and give you better exposure to what curricula other countries are following for a particular subject.

Native English speakers can also make good money by teaching English online as a second language to foreign students since they’re always looking for online tutors for high school and competitive exams.

Sell your notes and old books

Once you complete your course or graduate from your school or college, you hardly have any use for your classroom notes or revision notes you prepared. You can sell them online to students who are about to join the course or the level.

Many websites also allow you to sell your old textbooks and guides and get a good amount of your money back. If you use your books gently, you are likely to fetch more while re-selling them.

Similarly, you can sell old clothes and junk from time-to-time to make some quick money and make your living area clutter-free.

TV/Phone/Social media addictions mean losing money

man watching tv

TV, phones, FB, WhatsApp, Instagram, and YouTube eat up a lot of our time. Most people come back from their college or workplace, switch on the TV, and end up wasting hours doing nothing.

The moment you decide to let go of them, you’ll feel calmer and more relaxed. You will also find a lot of extra time to exercise, meet with friends, take up online gigs at micro-services websites, and do other constructive work.

Hours wasted in watching TV or phone literally mean losing hundreds of dollars per week.

Save your $10 notes

Saving money needs discipline and it’s not an easy trait to acquire. However, you may end up saving a lot of money if you keep saving notes of a certain denomination.

Every time, you get a $10 note, stash it up in your ‘saving’ fund. The loss won’t hurt you immediately and you will be able to see your savings grow as your days pass by.

This only works when you deal in cash. If you make digital payments, you may try another variation of this tip. For example, each time you spend $100 or more, put $10 in a separate saving or investment account.

These days, almost everybody is doing a side job along with a full-time college degree course. These tips can help you alleviate your financial woes as a student and work your way to a happy and contented life.

The post 5 Ways You Haven’t Considered to Save or Make Money appeared first on Dumb Little Man.

How The Student Loan Bubble Affects The Economy

Surpassing the market value of media giants Microsoft and Facebook combined, the national student loan debt ceiling is coming up on crisis levels. The United States is no stranger to financial disasters; the Great Depression still within living memory, the mistakes of the past are perhaps going unheeded as we approach yet another potential crisis.

Reaching $1.4 trillion, millions of Americans from recent grads to Gen X continue to struggle to make monthly payments. To make it worse, there’s only a lifetime ahead for this to go on.

What’s The Problem With All This Debt?

money management

College graduates leave their hallowed halls of learning with more than just a degree to show for it. On average, recent college grads are in the hole for nearly $30,000 and just ten years to pay it all back.

Monthly payments come out to around $400 a month, not a small amount for fresh-out-of-college graduates. The burden of an extra, hefty bill every month doesn’t just put pressure on an individual’s bank account, it also has huge ramifications for the economy at large. This is especially true since many Americans struggle to make payments.

Millennials are spending less and less on discretionary purchases every year. Average daily spending by 18 to 34-year-olds is down by $19 since 2008. By the time they reach age 30, millennials are less likely to start their own business. 42% are citing that they do not have the financial means to enter entrepreneurship.

It takes a recent college grad, on average, 12 years to save enough for a down payment on a home. Over 80% of people aged 22-35 that have not yet purchased a home blame their student loan debt. On the other hand, 47% of Americans are putting off buying a car. One in seven American couples are waiting to get married as a result of financial roadblocks

From A Drag On The Economy To The Next Bubble

So, how are we going to manage this bubble that’s about to burst?

how to manage money effectively

For those living and struggling with student loan debt, there are options to help make repaying these loans easier and faster. Income-based repayment, rather than fixed repayment base on loan amount plus consolidation options means lower interest rates, lower monthly payments, and avoidance of deferring loans. Deferment rates are highest amongst young and recent graduates, with 26% of millennials and 77% of Gen Zers choosing deferment.

Additionally, American graduates are given just one-third of the time to pay back their student loans in comparison to other countries. Extending the period of time in which to repay loans helps in the short term by lowering monthly payments. It also gives young people more options for saving money and stimulating the economy.

In 2013, Congress made moves that actually lowered the general interest rates for student loans, but these changes were not made immediately available to individuals who had taken loans out prior to the change.

  • Repayment period in the US is ten years; in England, it is 30 years
  • Extending the time provided to pay back loans will lower monthly payments, but may increase interest
  • The pre-2013 rate was 7%; 2018 rate was down to 5.05%. Lowered interest rates even by just a few points can help save the borrower thousands of dollars over time and potentially help pay off loans quicker.

However, some experts agree that it will take more aggressive and even “radical” changes to make lasting progress. This calls for a massive overhaul to not only loan policies but educational standards as well. The outright cancelation of loans, while not entirely unheard of, is rare and only available to certain careers.

Nurses and public school educators have the option to cancel their loans after a period of time. However, canceling all student loan debt could change the game completely. Loan forgiveness would encourage consumers to spend more of their money on economic goods and services, rather than on repaying on debt and interest, to stimulate the economy. On the other hand, it could increase taxes for everyone.

How Could Less Student Loan Debt Affect The Overall Economy?

A step further from loans canceled outright, some experts suggest hitting the issue right at its source is the most effective solution: free public college. Existing in several European countries, the precedent for free college has already been set and acts as a living, working “experiment” in Germany and Denmark.

From Senator Bernie Sanders’s proposed 2017 College for All Act, it was estimated to cost $47 billion per year to manage free college and states. Things are looking up in such states as New York and Tennessee as they’re already working on free tuition for in-state students in public colleges.

Canceling student loan debt would increase GDP by up to $108 billion per year for the next decade. Canceled student loans would add up to 1.5 million jobs into the economy. No tuition costs would dramatically reduce the financial burden of earning a college degree, influencing the economy as a whole.

Learn more about the student loan bubble from this infographic.
Student Loan Debt
Source: Student Loan Review

The post How The Student Loan Bubble Affects The Economy appeared first on Dumb Little Man.

10 Things You Didn’t Know About Your Car Insurance

Car insurance can be very confusing for anyone. It’s also one of those things that can be very costly if not done right. We rounded up the 10 key things that you may not know about your car insurance.

Having “No-Fault” Insurance

Many people mistakenly think that when they have a no-fault car insurance, no one will be blamed or considered at fault in the event of an accident. If you cause an accident or scratch a car when you park, having this type of insurance doesn’t necessarily mean that you’re safe. If you caused the accident, you can and most likely will be held accountable.

This type of insurance means that if you are in an accident and it isn’t your fault, you won’t personally have to go after the other driver’s insurance or the driver for compensation. The insurance company will do it for you automatically.

Several Factors Impact Your Insurance Cost

You’ll get asked a series of personal questions when you apply for your car insurance. The list can include your gender, age, marital status, and how long you’ve had a license count. Your answers will impact how much your insurance premium will cost per month or year.  Additionally, any previous accidents or tickets can make your premium go up.

If you’re a male who is under 25 years old, your insurance company will deem you a higher risk for accidents. In turn, you’ll most likely have a higher premium than a female who is under 25.

Your Car’s Age and Type Increase Your Insurance Costs

car model insurance

People who drive high-end or luxury cars will typically pay more to have their car replaced or repaired in the event of an accident. This means that you’ll most likely pay more to cover this type of car because your insurance will pay out more if there is an accident. Cars that cost less to repair or replace or cars that are older will cost less to insure because it won’t cost your insurance company much if there is an accident.

Modifying the Car Can Cost You

A lot of people like to modify their vehicles, but insurance companies don’t necessarily like these modifications. There are a few valid reasons behind this. First, modifying the vehicle can impact how much emissions it releases into the environment. Second, if something happens and the insurance company ends up with the car, they may not be able to sell it again because the modifications make it illegal to drive on the street.

If you modify your vehicle, the car insurance company may take steps to protect themselves. This can mean increasing your premium. If you absolutely have to modify your car, look for a specific insurance company that won’t penalize you for it.

All Car Insurance Companies Have Different Rates

When you apply for car insurance, it’s vital that you shop around to find the cheapest car insurance that can give you all of the coverage you need. Several search engines allow you to compare various car insurance companies side-by-side so you can find the best rate. Don’t skimp on liability insurance and be very aware of what your car insurance covers and what it doesn’t cover. That way, you won’t get a surprise if you’re involved in an accident.

See Also: Average Car Insurance Rates For People Under 21 Years Old

Perks

When you think of car insurance, you usually don’t think of any perks that come with it other than avoiding a ticket for not having it. However, some insurers offer perks for people who are loyal to the company. You may get free towing in the event of a breakdown, tiered rewards with lower rates when you stay with a company for over a year and a refund for not having accidents every six months.

Your Rates May Increase with a Claim

Say you caused an accident on your way to work or school and the other driver filed a claim. Some insurance companies will increase your monthly premium in response to this claim. This includes if you file a claim in the event of an accident as well, and it applies whether or not the accident was your fault.

It Won’t Cover Your Belongings in the Car

Did you know that your car insurance will cover the cost to repair or replace your car and some medical expenses depending on your policy but not any belongings you lose as a result of an accident? For example, say you have your laptop, cell phone, GPS unit, or tablet in the car and they got ruined due to a car accident. Your car insurance won’t cover the replacement cost. It also won’t cover their replacement if they’re stolen out of your car.

It May Cover Pet Injuries

pet injuries car insurance

Some car insurance companies have coverage for veterinarian expenses if your pet is in the car and injured when you have an accident. Not all insurance companies offer this though, so you should ask if your pet routinely rides with you. Also, make sure you check on how much the insurance will cover because a lot of them cap at $1,000 for veterinarian bills.

You Can Save Money By Paying Your Premium in Lump Sum Form

Yes, you can pay your car insurance every month. This may seem like the cheaper option upfront. However, you’ll most likely pay more over the course of the year by doing this. It’s better to pay for a year or half of the year when you buy insurance. It’s more expensive upfront, but you’ll avoid additional interest fees, payment processing fees, and other miscellaneous fees.

No matter what insurance company you decide to use for your car insurance, make sure that you compare them. The goal is to get the cheapest car insurance available that will still provide adequate protection in the event of an accident. Take your time, shop around, and pick the car insurance plan that is going to work for you.

See Also: Not So Perfect Driving Record? What You Need To Know About Car Insurance Coverage Costs

The post 10 Things You Didn’t Know About Your Car Insurance appeared first on Dumb Little Man.

It looks like Coinbase is preparing to add a lot more cryptocurrencies

Coinbase aspires to be the New York Stock Exchange of crypto, and it is taking a small — but not insignificant – step to offering a lot more cryptocurrencies after it revamped the process of listing new digital assets.

The exchange currently only supports just five cryptocurrencies — Ethereum, Bitcoin, Bitcoin Cash, Ethereum Classic and Litecoin — and the process of adding each one has been gradual. The company would announce plans, and then later announce when listing the asset. The idea being to reduce the potential to send the value of a token skyrocketing. (Since support from Coinbase potentially adds a lot more trading volume.)

That clearly isn’t a sustainable process if Coinbase is to add “hundreds” of tokens, as CEO Brian Amstrong told an audience at TechCrunch Disrupt it eventually plans to.

Regulatory concern is high on the scale when evaluating support for new cryptocurrencies, so now Coinbase is speeding up the process by limiting trading of some tokens to specific locations where necessary.

“Today we’re announcing a new process that will allow us to rapidly list most digital assets that are compliant with local law, by satisfying listing requests in a jurisdiction-by-jurisdiction manner. In practice, this means some new assets listed on our platform may only be available to customers in select jurisdictions for a period of time,” the company said in a blog post.

That’ll mean an end to the double announcement — ‘token X is coming soon’ and ‘token X is now supported’ — and instead a single reveal. That indicates that a large number of new assets may be incoming — for an idea of which ones, Coinbase recently said it is looking over a number of cryptocurrencies.

Interestingly, the company also noted that it may introduce a listing fee — this is common with many other exchanges — in the future in order to cover costs around adding some projects.

“Initially there will be no application fee. Depending on the volume of submissions, we reserve the right to impose an application fee in the future to defray the legal and operational costs associated with evaluating and listing new assets,” it explained.

The company has opened a listing proposal link, here. If similar features from other exchanges are anything to go by, Coinbase’s will be flooded by naive token holders who think they have a shot at getting listed on Coinbase, which will take them to the moon. Good luck maintaining that list, guys.

Note: The author owns a small amount of cryptocurrency. Enough to gain an understanding, not enough to change a life.

Coinbase plots to become the New York Stock Exchange of crypto securities

The future of Coinbase looks something like the New York Stock Exchange. That’s according a vision laid out by CEO Brian Amstrong who was interviewed on stage at TechCrunch Disrupt in San Francisco today.

Coinbase is known for being the most popular exchange for converting fiat currency into crypto — most of the largest traded exchanges are crypto-to-crypto — but he foresees a future in which it plays host to a growing number of cryptocurrencies as it becomes standard for companies to create their own token, which runs alongside equity as an alternative investment system.

“It makes sense that any company out there who has a cap table… should have their own token. Every open source project, every charity, potentially every fund or these new types of decentralized organizations [and] apps, they’re all going to have their own tokens,” Armstrong said.

“We want to be the bridge all over the world where people come and they take fiat currency and they can get it into these different cryptocurrencies,” he added.

Brian Armstrong (Coinbase) says crypto regulation will result in the next version of the stock market #TCDisrupt pic.twitter.com/2kyxAmhPSZ

— TechCrunch (@TechCrunch) September 7, 2018

That tokenized future could see Coinbase host hundreds of tokens within “years” and even potentially “millions” in the future, according to Armstrong. That’s a big jump on the five cryptocurrencies that it currently supports today, and it would make it way larger than financial institutions like the New York Stock Exchange, which is actually a Coinbase investor and is getting into Bitcoin, or the NASDAQ.

One of the critical pieces of making this vision a reality is, of course, regulation. This week at Disrupt, others in crypto space have argued that a lack of clarity around crypto regulation is costing the U.S. as innovation and startups are being developed in overseas markets. As the founder of a U.S.-based crypto startup that is valued at over $1 billion and is hiring hard, Armstrong doesn’t subscribe to that thesis but he did admit that there is “a big open question” over whether the majority of the new rush of tokens he foresees will be securities or not.

Still, Coinbase has made moves to add security tokens to its portfolio with the acquisition of a securities dealer earlier this year.

“We do feel a substantial subset of these tokens will be securities,” he said. “Our approach has always been to be the most trusted [exchange] and the easiest to use. So we want to be the legal compliant place where you can start to trade these tokens that are classified as securities.”

“Web 1.0 was about publishing information, web 2.0 was about interaction and web 3.0 is going to be about value transfer on the internet because now the web has this native currency and so applications can be built that instantly tap into this global economy on the internet,” Armstrong added.

How international can crypto become? The Coinbase CEO thinks that the total number of people in the crypto ecosystem can reach one billion within the next five years, up from around 40 million today.

You can watch the full video from Armstrong’s interview below.

Note: The author owns a small amount of cryptocurrency. Enough to gain an understanding, not enough to change a life.

5 Ways To Get Physically Fit Without Spending Too Much Money

According to research by the National Health and Nutrition Examination Survey (NHANES), more than 1 in 3 adults are overweight and 1 in 13 adults have extreme obesity.

The findings mentioned above are to be expected in today’s fast-paced environment. More and more people spend long hours at work to maintain their financial resources. Unfortunately, this 9-to-5 lifestyle often affects our food and lifestyle choices. Most adults on a tight budget avoid the gym because they don’t want to spend money on monthly membership fees.

It may seem like a wise investment to some, but let’s be honest. A gym or fitness center can be heavy on the pocket.

However, sticking to your budget doesn’t mean that you have to compromise your health. Getting fit on a budget is totally possible.

So, here are 5 of the easiest and most inexpensive ways to get physically fit without burning holes in your wallet.

Walk 10,000 steps a day

walk daily

Most of us take our phone everywhere. We use it to message friends, take photos, send emails, and much more. So, why not take advantage of this hand-held device and use it to track our fitness levels, too?

iPhones have an inbuilt step-tracker loaded as a standard feature. But the latest study suggests that using our smartphone to track the total steps taken in one day may not be accurate. Researchers found that the iPhone’s built-in pedometer missed about 1340 steps (almost half a mile) in a day.

This is why we recommend you to invest in a physical tracker or a pedometer as it can help you achieve your goal of walking 10,000 steps a day. Walking for 30 minutes a day has tons of health benefits and can help keep chronic illnesses at bay.

Watch what you eat

If you are looking to lose fat and build muscle, then you need to increase your intake of healthy food. Eat a balanced diet that contains protein to help build muscles, fruits and vegetables for mineral and fiber, wholesome carbs to keep those energy levels high, and healthy fats to boost fat loss. Don’t forget to drink ample amounts of water to stay hydrated.

Eating healthy doesn’t always have to be expensive. Whether you are a student or an adult living within a limited amount of money, here are 20 tips that will help you make better food choices on a budget.

Volunteer for a good cause

We are a firm believer in the idea that what goes around, comes around. Try giving a few hours in a week to your nearest nonprofit organization. Help them with physical work like garden digging, trail building or training your local sports team. You’ll experience double the satisfaction. Nothing beats the good feeling that arises after helping others and the soreness that comes from working hard for a good cause.

See Also: The Power of Volunteering

Clean up

clean up

Believe it or not, you can burn a lot of calories by cleaning, especially if it is the intense spring-cleaning sort. The exact number of calories spent during housework and cleaning varies from person to person and depends on the individual’s weight.

Stay away from toxic chemicals and don’t contaminate your environment by using them regularly. Use mild cleaners like soap, water, and vinegar which do an equally good job. Get moving by pushing the couch and cleaning underneath it. Wash the windows and get out all the extra stuff out from the garage.

Catch up with a friend

Catching up with a friend or colleague for a game of tennis, golf or swimming is a great way to combine socialization and exercise. You’ll feel motivated and refreshed after flexing those muscles and spending quality time with a cherished one. Remember, the key is to avoid picking up a pack of beer on your way back and passing out in front of the TV!

Conclusion

If you want to live a long and healthy life on a budget, think positively and work hard to achieve your goals. Visit your physician at least once a year to know more about the workout that best suits your body type. Use a waist trainer to maintain a correct posture during the workout session.

Eat home-cooked food at least five days a week. According to research, home-cooked meals are far more nutritious and healthier than convenience foods. Plus, apply the Japanese concept of living and eat till you are 80% full instead of wiping your plate clean every time. Give up smoking and drink occasionally.

Just make these small changes in your lifestyle and switch to these lifelong habits. You’ll notice a rise in your mental and physical health while staying well within your budget.

Do you have any tips or tricks that can help stay us fit without spending bucket loads of money? Share your best-kept fitness secrets with us in the comments below.

The post 5 Ways To Get Physically Fit Without Spending Too Much Money appeared first on Dumb Little Man.

Smart Tactics to Resolve and Stay Out of Entrepreneurial Debt

Debt is a part of every business and every entrepreneur knows that. However, not all entrepreneurs are aware of the difference between a bad and good debt and that makes it hard to learn how to avoid the debt trap.

All good business debts are credit lines, mortgages, and loans. They get leveraged for the benefit of the entrepreneur’s business. In other words, they are productive debt.

Bad debt, on the other hand, is the amount that you can’t leverage as your company expands. Financial experts call this reductive debt. Simply put, it’s money which isn’t working in your favor. Generally, this capital gets used to purchase things that are beyond your financial reach. Typically, the results aren’t always favorable.

Reasons entrepreneurs encounter debts

Entrepreneurs find themselves in debt for three main reasons. They are discussed as follows:

The fluctuations of the cash flow

Some entrepreneurs and business owners sometimes undervalue the crucial cash-flow ups and downs. They are unable to predict a poor cash-flow for a prolonged time frame. These entrepreneurs usually switch to credit cards to manage the troublesome cash flow, hoping there’s some balance.

Most entrepreneurs feel that they can repay off their credit card amounts fast, but that’s far from the truth. And that’s the starting point of the crisis. It is here that entrepreneurs contemplate on loan and get caught up in a debt cycle.

Excessive business pressure

Sometimes, entrepreneurs start to live on their business income. It is not a smart call until such time the business can support them.

Most leave their jobs and go all out to develop a business. But most don’t realize that they aren’t yet ready to pay off the monthly earnings that they stay on.

Each company requires investment and it also needs time to invest. It also requires time and reserves for generating a consistent cash-flow. If you resonate with this, have a second line of earning to balance the crisis.

Overconfidence is dangerous

At times, entrepreneurs can be overconfident while using productive debt. Generally, the situation shapes up something like this:

The entrepreneur counts on his earnings and he decides to maximize the business debt to expand his business as fast as possible. However, his lifestyle also gets modified to the new income level.

Here’s where the situations go out of hand.

Due to losing customers or an economy change, a crisis happens. The entrepreneur incurs a financial loss and the situation goes out of control. The entrepreneur incurs a debt to smoothen financial crisis.

See Also: Tips for New Entrepreneurs: What You Need to Know Before Starting A Business

How to manage entrepreneurial debt?

Entrepreneurs who understand good debt go a long way. Their strategies are progressive. Some of these entrepreneurs, who are millionaires, have various thought processes that other business owners don’t possess. They have a unique way to make money and manage debts as well.

Two primary methods have been discussed below as follows. If you want to know more on managing entrepreneurial debt management, you can browse through sites like NationalDebtRelief and others to get better information.

Getting out from a reductive debt

Every entrepreneur wants long-term success. For that, it’s essential to obliterate all kinds of wrong and reductive debt from your business at the earliest.

The spreadsheet strategy or analysis must be familiar to you. It is instrumental in taking you out of any business debt faster than you can imagine. The process is simple.

All you need to do is:

• Develop a basic financial plan
• Adhere to it
• Learn from your experience

You need to start by outlining the monthly earning. Know how much of it you can use on an end-to-end basis to reduce the reductive debt. Commit as much as you can. The amount you decide to pay to remove the deficit needs to stretch you.

Go on and create a reductive debt list in proper order. You may start with a high-value debt amount at number 1 and the least at last. Don’t forget to add in the least payment beside every debt in your list.

Once you do this, you’re all set to execute the plan. Go ahead and take out the exact sum that you promised to remove the debt with on a monthly basis. You may add some extra money to small debt payment.

Keep on making your required minimum repayments for every remaining payment. You’ll notice that the lowest debt gets repaid fast this way. Going forward, you may apply the same process to pay off the high-value debts. In the same process, you’ll see that the high-value debt amounts get repaid. Repeat this process, until such time all the debts get cleared.

Consciously stay out from any debt

It is the ideal way to steer clear of all kinds of business debt. However, precise financial planning is essential. You can count on few of the best business practices to manage and stay away from entrepreneurial debt.

Try and shrink expenditures – Being frugal is smart. Successful entrepreneurs always suggest this practice. You can read books that will be of help.

Avert unnecessary expenditures – Do consider the opportunity expenses when you are arriving at a financial decision.

Recruit people only when it’s possible – You have to pay your staff. So, it’s a smart call to only recruit people when you have the financial capacity to. Else, you will have to apply for a loan and eventually fall into a debt cycle.

Don’t stretch with productive debt – Spending carefully, even with productive debt, is crucial. Making investments that can go against you isn’t a smart decision.

Conclusion

In all situations, it is always advisable to have ample cash deposits. It helps to manage economic downturns and manage other emergencies.

In the recent times, debt consolidation has proven to be a great way to manage entrepreneurial debt. Rather than repaying at various quarters, it is easy to pay off one huge loan amount. That way, an entrepreneur will have one amount to pay off in a month.

Today, there are various financial institutions providing debt loan consolidation services and other financial counseling. You can use it to plan your business cash-flow better and master how to avoid debt trap.

See Also: Entrepreneurship: A Better Career Choice For Generation Z?

The post Smart Tactics to Resolve and Stay Out of Entrepreneurial Debt appeared first on Dumb Little Man.

10 Easy Money Hacks to Improve Your Finances

Personal finance doesn’t have to complicated. With the right mindset and commitment towards a better financial life, you can make big improvements effortlessly and quickly.

The following are 10 easy money hacks that can take your personal finance management to the next level:

Online Shopping

online shopping

One of the best ways to save money is to shop online as frequently as possible. This is because there is a slew of reliable and useful online portals including Amazon, Walmart, etc. where you can enjoy attractive discounts and cashback offers.

By making purchases at the right time and from the right website, you can easily save up to 30% or more than you would otherwise spend at your local store where you have limited options and limited time for research.

Refinancing

Is your mortgage or car loan giving a hard time? If your answer is “yes”, then refinancing can be a good solution to look into.

In refinancing, you essentially take a new loan to repay the current one. The advantage of this is that you can get a lower interest rate and a more flexible repayment structure with the new loan.

Increasing Credit Score

Your credit score will play a huge role in your life as far as the finances are concerned. So, if you have a high score, then not only you can get a personal loan, home loan, etc. rather easily, you can also negotiate and get a lower interest rate than the standard. This way, you can save a lot of money on the interest.

There are many easy and simple ways to improve your credit score. You don’t even need the help of a professional to succeed in this endeavor. You can just refer to authority websites and blogs such as the Dough Roller Blog for tips and advice. By taking the recommended credit-building measures, you can make decent improvements in a short period and enjoy more financial freedom!

Avoiding Minimum Payments

minimum payments

Credit card issuers often market their products with the “minimum payment” feature. As you can imagine, it’s an option for a credit card user in which they can choose to pay only a small portion of their credit card bill i.e. the minimum payment to avoid penalties. However, it’s something you should stay away from as much as possible.

When you make a minimum payment, your account is saved from fines and penalties. However, the remaining amount i.e. what’s left on your bill after you have made the minimum payment is carried over to the next month and added to the next bill. In addition to that, this balance continues to attract interest. Thus, always pay your bills in full to avoid paying interest and to protect your credit score.

Buying Used Items

There is nothing wrong with buying used products, especially when they cost a lot when bought new. However, the key is selective purchase.

For instance, items like furniture, expensive college books, hardware tools, musical instruments, etc. can be easily bought online with websites like eBay, craigslist, wallapop, and letgo etc. This is because these items age well and their quality does’t degrade too much over time if they are well taken care of.

Buying used items can help you save as much as half of the original price. However, always be sure to inspect the products before you hand over the money.

Availing Tax Benefits

Do you pay the exact amount of income tax that’s applicable to your profile? There are ways to lower your taxable income which means you can save money that you would otherwise pay in taxes.

For instance, Health Savings Accounts (HSAs) allow you to put money into an account tax-free and withdraw it tax-free when used to cover medical costs. Similarly, you can deduct interest from your student loan payments on your tax return.

Taking up Freelancing

There are many easy ways to make money online. For instance, if you are good at writing, photography, video editing, etc. then you can take up related gigs online from SMEs and individuals looking for help.

There are a number of reliable and high-paying freelancer websites like Upwork and Freelancer where you can create an account to bag gigs and earn some decent money on the side. This will also allow you to use your free time during weekends or holidays for something productive and financially beneficial.

See Also: 5 Freelancing Tips That Will Make you Successful

Setting up an Emergency Fund

emergency fund

Life is uncertain, and if you lose your job one day or aren’t able to work for some other reason, then your savings can deplete quickly, thus leaving you vulnerable. You may end up taking a personal loan at a high interest rate being short of options. However, you can prevent this kind of situation by setting an emergency fund for the rainy days.

Ideally, an emergency fund should be enough to cover your expenses for at least 3-6 months.

Using a Mobile App for Tracking Expenses

We have all heard that creating a monthly budget, monitoring the expenses, etc. is important. However, who has the time to note down all the expenses and do the math? Fortunately, there are a number of free apps that can help you track your spending.

The best personal finance apps in the market are capable of reading your emails and SMS for automated tracking, creating detailed reports, suggesting payment methods and credit cards that offer discounts, etc. Thus, these can help you save money in a variety of ways.

Reconsider Recurring Expenses

A lot of times, one-time expenses such as car repair, dental treatment, etc. can’t be avoided. However, the recurring expenses which are also the biggest burden on your finances can be looked into and altered for saving money.

If you find that there are more affordable alternatives to your current recurring expenses such as insurance premium, Internet connection charges, cable bills, etc. then you can make a switch. Maybe you can find a cheaper Internet plan, or replace your home’s light fixtures with their energy-efficient versions at to lower your utility bills, etc.

So, these were some of the best ways to improve your financial health. Do try them out and see how you get the benefits in just a short period! Good luck!

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5 Strategies For Paying Off Student Loans Fast

No one can deny the fact that education nowadays has become very expensive. It is not always possible to fund the whole investment personally and sometimes, you’ll need assistance in the form of student loans.

If you have a good strategy in place though, paying off student loans fast is possible. In case you are having problems devising a plan alone, you can reach out to a financial adviser who can analyze your outstanding loan and give you the best method to clear it.

Being just out of college still means there is a lot left to see in life. Therefore, worrying and losing sleep over student loans should be avoided. If you are looking for help, then this article can guide you in taking the right steps.

Figure out your budget

figure out budget

This is the first reality check that you need to do before paying off your loans. You need to figure out what your budget is every month while repaying. It should be more than the minimum balance that you should invest in.

Whatever extra cash you have, don’t use it for any other purpose other than paying your loan. The extra cash will assist you in clearing your debt faster.

Refinance your student loan

If you have multiple student loans running at various places, getting it to one single agency might be a wise decision. By doing this, you will need to pay only a single interest instead of multiple small ones. As a result, your interest amount will be lower.

Refinancing gives you additional time to repay the loan but consider the decision very carefully. The longer it takes you to pay your loan, the higher the accumulated interest will be. Act according to your situation.

Get in on the sharing economy

Sharing economy is a very novel and fair concept that has caught on with the younger generation.

If you are swimming in a debt pool, consider renting or borrowing useful stuff from strangers instead of paying a lot of money to buy them. This can help cut down your expenses, leaving you with more money to repay your loan.

Since a digital platform is involved here, the transactions are relatively safe, which allows many strangers to collaborate.

Treat the loan like a mortgage

Once you have an outstanding student loan, treat it like you would treat a mortgage. A mortgage is a property or a good whose value is almost similar to your loan amount.

Any issues with the loan can be settled by taking over the mortgaged entity. Once you treat your student loan like a mortgage, you will be motivated to clear your loans as soon as possible.

Focus on one goal at a time

focus on one goal

If you have multiple loans on your head and you keep worrying about all of them at once, life is going to get difficult for you. Instead, you should focus on one loan at a time and concentrate on clearing that.

If you are having difficulty in deciding how and where to start, you could refer to debt review. It can analyze your outstanding loans and give you a plausible solution to repay it.

There are two ways of doing it.

You could take up the loan with the largest amount and start clearing it and once that is done, you can go for the loan of the next lesser amount. This is called the debt avalanche system and it works for most people.

Another technique is to clear the low-cost loans first and then go for the higher ones. This gives you a mental satisfaction of finishing at least one loan so that you can move on to the next one with confidence. This is known as the debt snowball system. You could resort to any of the ways according to your convenience.

A student loan is a burden at a tender age but once you have a good strategy in place, you won’t have a hard time freeing yourself from your debt.

See Also: Is There Going To Be A Student Loan Apocalypse?

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Debt Collection Technology Updates You Need to Be Aware Of

If you’re not on time with your bills, it’s important that you stay aware of the latest debt collection technology. From your smartphone to Ringless voicemails, debt collectors have gone high-tech to help increase payments.

While agencies argue that their methods benefit customers and allow collectors to complete their mission, debtors are left surprised and consumer advocates are beyond angry.

Here are the latest updates on debt collection technology:

Ringless Voicemail Drops

ringless voicemail

A lot of debt collectors are excellent in finding ways to test and defy the laws that put a limit on how often they can call their clients. One of those ways allows them to send voicemails directly to phones without causing a ring.

Due to a technicality, these messages don’t appear as calls but messages that show up as voicemails.

The Consumer Protection Firm’s attorney Billy Howard doesn’t fall in line with companies like Stratics Networks who argue that no violations of regulations occur because auto-dialed collections technically are not phone calls. “They’re trying to torture the language of the Telephone Consumer Protection Act,” says Howard.

Senior sales vice president Paul Gies of VoApps Inc. believes differently. Gies argues that customers prefer ringless messages to standard calling because it creates less pressure to respond immediately. Consumers can return when they’re able to without feeling forced. He adds that collectors believe the system works too well.

And it’s not only the consumer Gies believes he’s looking out for. Even clients tell them that they overwhelm their call centers with inbound volume.

Avatars

Friendly avatars can increase the likelihood of payment from debtors than when they visit typical sites. That is according to Tom Gillespie Jr. who works as the chief executive of BeGuided Inc.

His collection company, Access Receivables Management Inc., works under the idea that “nice people collect more”. They aim to turn around traditional interpretations of debt collectors by moving away from practices like threat and insults with characters like Zoey. This animated avatar appears in borrowers’ inbox and guides them through the debt repayment process.

Zoey and avatars like her have a wide range of character traits. From access to multiple languages to the ability to smooth-talk borrowers into repaying debts, these avatars offer a personal approach. They also have access to credit histories to allow for better payment plans for debtors.

“In the last year, we’ve sent out millions of emails” notes Gillespie, “We’ve had zero consumer pushback” when using avatars.

Speech Analytics

Cursing during conversations with debt collectors will be met with prompts provided by CallMiner Inc. software. It helps direct discussions back to where they need to go. These programs evaluate keywords used during conversations to identify emotions.

The color-based box system used by Supervisors incorporates the company’s speech-analytics system. Colors communicate the agent’s standing while interacting with a debtor. Green means that the conversation is typical and the agent is providing necessary information like “mini-Miranda” rights for debtors to understand their rights.

If a box changes color to red, it signifies a problem. Maybe an agent is experiencing difficulty or there’s profanity.

“A supervisor can consider barging in and taking over the call, or whispering into the agent’s side of the call,” CallMiner marketing vice president Scott Kendrick explains.

The Eureka program of CallMiner has multiple functions. It can provide a ranking system for agents and guide the negotiations for valid results. It can even step in and give better responses when an agent struggles to make an emotional connection with the borrower.

Games

Debt collection agencies like FidoTrack LLC in Vermont use video game tactics to motivate agents to compete against each other to improve performance. This shouldn’t be surprising, considering collection agencies are known for not caring or being reachable.

The president and founder Brett Brosseau justifies these tactics saying that “you figure a lot of people who are actually collecting are maybe on the other end of the phone in their personal life. It sucks to ask people for money.”

Agents at FidoTrack improve their sales by 19% according to Brosseau through these types of regulated games. He adds that consumer complaints are down as well with shorter calls and a better response.

The game-like competition between collectors may make work more enjoyable but debtors surely aren’t enjoying them.

Other Tactics

social media tracking

Skip tracing makes it difficult for debtors to hide from collection agencies because agents look through various social media to locate them.

While some collectors will merely use social media, others are taking more aggressive approaches. An agency in Texas, for example, links the Social Security Numbers of their clients to their social media accounts, causing upset among specific groups.

Spoofing, on the other hand, is a tactic employed by agents who change their area code to match the debtor’s local one. This tricks the debtor into responding. The Consumer Financial Protection Bureau advocates for canceling this practice.

If consumers feel they have been mistreated, they have options. They can either complain to the right government agency or they can sue the agents. This opens them up to something called scrubbing.

Collectors look through lists of databases when they are scrubbing to remove potential hazards. These “banana peels”, as they are called in the industry, are people who have litigious records and are seen as unnecessary hazards.

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The Top 4 Best Alternatives to Paypal for Business

Paypal is the biggest payment gateway out there and there’s no doubt about that. It is the most famous online payment system in the world to the point that people associate the word “payment gateway” with Paypal. It offers a nice, clean and very comfortable service within a click and makes everything possible. You know the score.

However, Paypal is not the only payment gateway out there and it is not even the best of the bunch. Sure, it dominates the market but it doesn’t mean that the competition is just slacking around. There are competitors and they rapidly evolve and try to outplay the big guy.

Before we get to the best alternatives to Paypal for business, let’s explain its problem first.

Paypal is a victim of its own marketing. Over the years, Paypal was hyped as the one and only super payment gateway and people believed in that idea. However, the reality is not exactly like that.

Paypal is good for basic transactions. It is serviceable for slightly larger sums but when it comes to a commercial operation with diverse payments and schedules, it gets clumsy and barely usable.

Another thing that raises concerns is security. Paypal is not very good at it. There are holes in its security systems that enable account hijacking and account blocking and that is not something you want to experience. Imagine the consequences of such glitches in your business.

Who are Paypal’s Competitors?

Diversity is the key to success in eCommerce operation. You need to have a set of options for your business and you need to give your customers several options to perform payments.

By using only one payment gateway, you are seriously limiting not just yourself but your customers, too.

With that, here are the best alternatives to Paypal for business you should consider.

Stripe

stripe payment

Stripe is a heavy hitter. It came late to the party and turned the tide on its side simply by being handsome and charming. Jokes aside, it is one of the biggest competitors to Paypal because of its smoothness of operation and security.

Stripe is really easy to integrate into any kind of website. In addition, it avoids redirects and performs the entirety of operation on your website. It gives a larger degree of control over the operation and that is particularly calming for a businessman.

Stripe’s greatest asset is its fraud detection system. It consists of thorough credibility checks, comparison with blacklist databases, and analysis of activity. It guarantees that no one ever will succeed in wrecking your account.

Stripe’s fees are standard but chargebacks are lower than Paypals.

The challenge comes with operating it. In order to make Stripe work, you need to know a thing or two about programming. That isn’t that much of a problem if you think about it for a moment.

Square

square-official-payment

Square is probably the most radical payment gateway out there. Don’t get me wrong, it doesn’t skew the principles of the economy. Instead, it offers services that feel absolutely different from any other payment gateway available.

For the lack of a better word, Square is “Stripped-down” or “no-nonsense” payment gateway. That is what makes it so attractive to an ever-growing audience.

From the user experience perspective, Square is very similar to Paypal if it was cleaned-up and dropped weight. It is faster, smoother, and more elegant to use.

In terms of service, it is a reliable and trustworthy gateway. If there is something wrong, don’t worry as its customer support service will be the ones to handle it.

Authorize.Net

authorize net

Authorize.Net was there from the very beginning of eCommerce on The Internet. It saw it all and it knows a couple of tricks. As one of the oldest payment gateways active today, Authorize.Net has the benefit of having the time-tested trust.

One of its major assets is security measures. Authorize.Net is a perfect gateway for those who have a paranoia about online transactions.

In terms of UX, it is really user-friendly. You can do whatever you need if its legal. The tools for structuring payments are easy to handle and there are many additional settings that help with nuances and scheduling.

However, Authorize.Net is not cheap and that is a major turn off.

Braintree

braintree

Braintree is a division of Paypal that is a much better fit for eCommerce payments.
The best thing about it is how easy it is to handle very different types of payment. Just a couple of clicks and you can get your thing done.

Another great thing is integration. Unlike Paypal that needs some tweaks in order to fit the website, Braintree fits every type of site like a glove.

Fees are standard but in exchange, you get more features to play with so this is definitely a win. However, there might be some complication regarding technical adjustments.

Conclusion

Paypal still stands tall in the payment gateway segment, but there are worthy competitors who have something else to offer. For business owners, that is a good thing.

The nature of the competition in the payment gateway segment is beneficial for every involved party. It jumpstarted rapid evolution, increased the overall quality of services, and deepened sets of available features.

As such, the variety of options available is inspiring.

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Eight Mistakes You Could be Making with Your Health Insurance

Health insurance can be expensive, but not having it can be an even bigger mistake. Did you know that the average cost of an emergency room visit in the United States can cost upwards of $1,233 per visit. If you don’t have insurance, you could end up paying this bill out of your own pocket. There are several common mistakes people make when it comes to your health insurance, and you don’t want to make them if you can help it.

Picking Health Insurance with a Low Premium

good health insurance plan

With health insurance, your premium is the amount you pay each year for your healthcare before your insurance covers the rest. A lower premium means that you’ll pay more for any co-pays or deductibles after you have the services. A higher premium means that you pay more upfront, but the costs go down once you pay it.

If you’re generally healthy and if you have a decent financial cushion that can handle a more significant medical bill, you may benefit from having a lower premium. If you have ongoing health issues, a higher premium may be better because it’ll reduce the costs of your visit expenses.

See Also: What To Look For In A Good Health Insurance Plan

You Only Use Employer Health Insurance

Insurance through your employer might be a most cost-effective option, and it might seem like the best deal upfront. If you’re relatively healthy, you can usually find cheaper options because the employer’s insurance rates are based on their employee’s average health statistics. It is essential that you shop around and compare health insurances.

Additionally, many employer health plans cover routine doctor visits and even emergency room costs, but they might not have vision or dental options. It’s essential that you shop around and look at your employer’s plan to see what services it’ll cover and which ones you’ll have to pay for.

Not Reading all of the Fine Print

Health insurance can be very dry and difficult to understand. This is why a lot of people don’t read it, and they assume that whatever they have done will be covered by their insurance plan. This isn’t always the case, and you could get a nasty surprise in the form of a large bill.

The fine print on your insurance information will tell you everything you need to know about your plan. It’ll let you know whether or not specific services are covered, what your co-pays are, what percentage of hospital stays the insurance will cover per day, and how much you have to pay out of pocket before your insurance picks up the rest.

Don’t Find out if You Have an HMO or a PPO Plan

HMO insurances have strict in-network and out-of-network fees they can charge. It also dictates which doctor, clinic, or hospital you can visit and have your insurance pay for it. A PPO plan is more flexible, and it lets you choose your doctor or clinic, and it can also be more lenient with in-network and out-of-network care.

A POS plan is a hybrid plan of the HMO and PPO plans. These types of programs let you see out-of-network doctors and clinics, but they usually require that your primary care doctor gives you a referral so you can go to them.

Skipping Health Insurance Because You Never See the Doctor

health-insurance-benefits

Life and accidents happen, and your health is one thing that you don’t want to be unprepared for. This is especially true because healthcare costs continue to climb, and even routine doctor visits can cost you over $150 per visit.

If you decide not to get insurance and you need medical care, you’ll most likely have to pay for everything out of your own pocket. Many insurance companies refuse to backdate their services, so you’re out of luck and on the hook for the full bill amount.

Ignoring Your Flex Spending Account

Many employers let you set aside a percentage of your check into a flexible spending account tax-free. These flexible spending accounts help you pay for medical bills that your insurance won’t cover. These non-covered services could include eyeglasses, dental, emergency room visits, co-pays, prescriptions, and deductibles.

Your flexible spending account can also help you reduce the amount you claim on your yearly taxes. If you have a taxable income of $80,000 each year, your annual tax amount is 15 percent or $16,000. If you’ve managed to save $3,000 in your flexible spending account, your taxable income goes down to $77,000. The amount the government claims as taxes drop as well.

Not Having Prescription Drug Coverage

Did you know that a lot of insurance plans don’t cover prescription drugs? While this may not be a big deal if you don’t take them regularly, they add up quickly. Certain prescription costs have gone up by as much as 10 percent, and you don’t want to get stuck paying for these on your own.

Take a look at your current policy and see if it covers the medications you routinely take. You might have to call your insurance company and ask about your specific medications, especially if they’re more expensive. You could also ask your doctor if any generic versions of your medicines exist because they’re usually cheaper.

Not Renewing Your Insurance Each Year

Almost every health insurance plan requires you to renew it once a year. State plans may require a renewal every six months. Make sure that you don’t forget about your annual or semi-annual renewal paperwork. If you don’t get it, call your insurance company.

Once your insurance lapses, it may be difficult to get it active again for the same price or on the same plan you had before. If you have medical services during the time your insurance lapses, it may not backdate and cover those services. This could cost you a lot of money and drain your finances.

These eight health insurance mistakes are very common, and you want to avoid them at all costs. Your health is important, and you want to make sure that you can get the care you need when you need it.

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A Simple Guide to Understanding Cryptocurrency

The cryptocurrency market has grown. It has gone far compared to its status when it was just starting way back 2009. According to the updated list of Investing.com, there are 1,890 cryptocurrencies available in the market.

By now, you’re probably wondering what those cryptocurrencies are. Guess what?

If that’s the case, then this article is for you. This will give you a better understanding of cryptocurrency and the following:

  • The main types of cryptocurrency
  • The top cryptocurrencies and their differences
  • Pros and cons of each cryptocurrency

What is Cryptocurrency?

The prefix “crypto-” originally stands for cryptography. It is a technology that stores information to keep attackers away from malicious undertakings.

If you will connect cryptography to your history class, Allied Forces in WWII used to apply it to send and receive confidential and secret messages. Nowadays, computer technicians utilize cryptography in a lot of different ways. One of them gave birth to cryptocurrency.

You can’t examine the history of cryptocurrency without first beginning with blockchain. It was started by Satoshi Nakamoto for Peer-to-Peer (P2P) transaction using Bitcoin. Blockchain gave the response to digital trust since it records imperative data publicly and doesn’t enable anybody to expel it. It’s transparent, time-stamped, and decentralized. Everyone can access it with the use of the internet.

With cryptocurrency, people don’t have to entrust their wealth to a single company such as a bank to handle their money. Banks are centralized while cryptocurrency is decentralized and runs by blockchain technology. Blockchain serves as a public ledger which enables tracking transactions while maintaining the anonymity of the parties involved.

Three Main Types of Cryptocurrency

bitcoin

Bitcoin

It is the first one to use blockchain in 2009. A person under the pseudonym Satoshi Nakamoto started it as a way to digitally and anonymously pay for goods and services between two parties without the use of third-parties to verify transactions. Several years passed, Bitcoin’s primary role is for goods and services trading. In 2013 to 2014, it boomed. It slowed down its pace and soared up again in 2017 until today. Bitcoin is the most well-known cryptocurrency made in history.

Altcoin

“Alternative Coin” to Bitcoin, it means that any cryptocurrency aside from bitcoin is considered as altcoin. And there are thousands of it available in the market. Altcoins came after the success of Bitcoin. More often, it presents as a better version of Bitcoin. Numerous altcoins are endeavoring to focus on any apparent constraints that Bitcoin has and thought of coming up with newer versions and competitive advantages.

Token

Some people find tokens generally fascinating. In contrast with the other two, tokens are special because they don’t have a particular blockchain. They are used to make purchases on Decentralized Applications. They also provide specific advantages like discounts. The dApps are built for the use of smart contracts which is why they use tokens.

Tokens have a value and that is the reason why people get them. Some purchase tokens to offer them later at a higher cost rather than get and utilize them right away on a dApp.

To transact using dApp, you must have Ether or NEO to make the necessary purchases. Other dApps are built on other blockchains like ETH or NEO. The nodes on the said altcoin blockchains still verify the token transactions. This means that the transaction fee is still paid using ETH or NEO and not with the token itself.

See Also: Cryptocurrency Trading for Beginners: How Can You Get Started?

Well-Known Cryptocurrencies in the Market

well known cryptocurrencies

Bitcoin

Pros

  • There are only 21 million Bitcoins.

There are only 21 million bitcoins to be mined in total. Since 17 million is already in circulation, the remaining 4 million bitcoins can be seen as a shortage for crypto enthusiasts.

This is actually a good thing. If there’s a lot of Bitcoin fans who want more of it despite the low supply, they’ll have to pay more just to get their hands on them. This can dramatically increase the price of Bitcoins.

  • It is easier to exchange than the other types.

It means that Bitcoin is easier and faster to convert into cash.

  • Bitcoin is acceptable in almost all stores than any other cryptocurrencies.

Hundreds of online sellers accept payments in the form of bitcoin. It is good for larger transactions because there is no charging on taxes. It also has lower transaction fees. Bitcoin has already established its name and that is why the trust and acceptance rating from the market is high.

  • It’s the biggest cryptocurrency.

Bitcoin is the king of all kings. It’s in charge of about 40% of the market. This domination means that Bitcoin has a huge liquidity and it has already established its name to public knowledge. Users do not have to worry about the malicious activities concerning cryptocurrency.

Cons

  • Fluctuation happens a lot. The price of Bitcoin changes almost every day. Actually, Mt. Gox, a Bitcoin exchange based in Shibuya, Japan collapsed and filed for bankruptcy due to Bitcoin’s price falling up to 50%.
  • A better cryptocurrency may replace Bitcoin. Hundreds of altcoins and many are still coming up. Bitcoin has been in the market for 10 years and any of the newer and advanced cryptocurrency may eventually replace the king crypto since there are other cryptocurrencies researching for advanced features than Bitcoin can offer.
  • It’s being used for crime. Many scammers are using the identity of popular celebrities or personalities to mislead others. Some fans of the artists are being victimized because they don’t know that accounts used for solicitation are fake ones.

Ethereum

Ethereum allows people to create dApps, tokens, and even smart contracts.

Pros

  • People who use Ethereum-built dApps will constantly require Ether.
    They’ll need it for the transaction fees as dApps run on the Ethereum blockchain.
  • There are newer projects on Ethereum.
    Arcade City, an app for P2P ride sharing where drivers and users are matched together, is being built now under Ether. An application, just like torrent, a file-sharing software called IPFS, will be launching soon. Ujo Music, a decentralized music platform where artists are being paid directly is also under construction. More projects concerning Ethereum will come soon and crypto fans shall stay tuned.
  • Speed. It only takes a couple of seconds to complete a transaction process in Ethereum. That is in contrast to Bitcoin which takes a minimum of 10 minutes.

Cons

  • Ether coins supply is greater than Bitcoin.
    This means that the scarcity for ETH is far from reality due to the fact that there’s a huge availability of the coins compared to Bitcoin.

Ripple

Ripple makes bank payments quicker which is why it’s considered as the banker’s coin.

Pros

  • Well-known companies have confidence in Ripple. There are financial organizations that have developed a partnership with Ripple. This is why it can be considered as a better alternative for you in the finance world. Gaining trust from the government, it has already manifested its power and influence.

Cons

  • Ripple is not decentralized. Ripple Labs, the company behind it, owns the majority of the tokens (XRP). They have power over it and if ever they want to, they have the power to sell all the tokens they have. This will definitely send the price down.

Litecoin

The blockchain for Litecoin was once a part of the Bitcoin blockchain. It split up when the update of Litecoin came. It has similarities with Bitcoin but Litecoin has distinct features.

It’s the first cryptocurrency to utilize the Lightning Network. It fixes issues concerning cryptocurrencies like scalability. It can process a lot of transactions in a matter of seconds.

Pros

  • Much faster and costs less than Bitcoin. Litecoin transactions only take seconds, just like Ethereum.

Cons

  • It’s only slightly better than Bitcoin. Litecoin won’t be that useful if Bitcoin improves into cheaper and faster transactions.

Lastly, taking the time to get a better understanding of cryptocurrencies is one way to know what you can get and what you can risk from using them.

See Also: Cryptocurrency Is On The Rise: Are You Prepared?

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