How to Make Budgeting Fun with Your Family
Setting spending limits and crunching numbers is not exactly a traditional recipe for family fun. But you can make budgeting fun by getting a little creative. Here is how:
Talk it through
Finances are a complicated subject. But it is important for your children to learn this very important skill early in life. In order to make budgeting fun for all, make it a game. Seat everyone at the table and talk about where the money goes.
Show them the money
Ideally, you should keep record of your finances in a tangible place. A specific folder in your computer or an organized excel sheet. But let’s be realistic, creating excel formulas is hardly fun for a child, let alone a fun activity for the family.
Our suggestion: Go old school!
Set out three containers, jars, banks or baskets. Mark one of the receptacles with the word save. One with the wod spend and the final with the word share.
Use real money and coins to fill the containers each month so the whole family can see exactly how a budget works and where money needs to go. Folger recommends divvying up money according to set percentages. This is an especially beneficial method to help your tweens and teens balance their own allowances while earning real-life financial lessons.
Work toward family-fun goals
Budgets are designed to keep your present bills paid as well as plan for the future. If your family is only focusing on what they’re giving up or not getting, there’s no way your family budget will resemble anything but doom and gloom.
Instead, making budgeting fun by including goal that everyone can appreciate or look forward to using. Perhaps you can work toward a family-fun day at a local amusement park or even an extended getaway.
When planning for a vacation, Godfrey stresses the importance of involving everyone in the family on decisions from where to go and what to do to how money should be spent. A budget designed specifically for fun-in-the-sun or a first-time adventure is sure to keep your kids interested in your family’s financial planning.
Give back as a family
Teaching your kids to give back is an important, life-long lesson. Dedicating a portion of your finances will create a life lesson and a lot of fun memories.
With open communication and an eye on future fun, you and your family can make budgeting fun and support your financial goals.
3 Great Financial Skills for Young Adults
The real world is expensive, and if you are a young adult the lack financial aptitude will harm you later on in life. Being financially unaware will make you struggle not only fiscally, but emotionally as well. That’s why you need to acquire financial skills as you make your way through college, navigate your first job and learn to save for the years to come.
College-bound
College is often the first time you will experience a real sense of freedom. Gone are the days of a traditional school schedule with parents and teachers standing over your shoulder to make sure you study, eat and complete your assignments.
College may also be the first time you are faced with managing your own money to cover bills, school expenses and inevitable loan payments. To help keep you from failing Personal Finance 101, we recommend establishing a budget.
Record income from sources such as part-time job, student loans, money from parents, grants, savings accounts and scholarships.
Then record expenses: things such as books, tuition, rent, clothes, entertainment, college fees, supplies, personal care items and transportation costs. By tracking the first two months of spending, you will earn an accurate baseline of necessary and unnecessary spending and where’s there’s room in the budget for saving.
On the job
The thought of saving for retirement after securing the first job out of college may seem ludicrous.
After all, you still need to pay off college loans, rent, car payments and insurance fees.
However, saving for the future as soon as possible and investing in employer-matching retirement programs with the max amount possible are smart financial moves, according to The Balance writer Miriam Caldwell.
Remember the budget you used in college?
Now is the time to update if for the real world. Tracking your income, expenses and spending is the only way to gain control of your finances. As you progress in your career, your financial health should become more robust.
Be sure to consistently evaluate and re-evaluate your budget, plans for the future and investment options.
Credit cards are convenient, and sometimes the only resource you have to get through stressful financial times. But, they come at a high price. Sinking into credit card debt happens quickly and before you know it, you’re over your head in fees and balances you can’t clear.
To help you stay afloat, forgo any dependence on plastic.
In case of emergency
Life will throw you expensive curveballs, and without an emergency fund, your financial health will take on serious damage.
According to Investopedia writer Amy Fontinelle, any amount you can save each month in a money market account, certificate of deposit or online savings account will do wonders in establishing your financial safety net.
Be sure the account you choose earns high-interest rates, too.
By adopting smart money habits, like budgeting, you’ll create a lucrative and secure future.
4 Ways to Raise Capital for Your Business
Very few people know how to raise capital for their business, especially if it is their first startup. Though a necessary part of the process, investing your own money may not be enough. How can you raise capital for your business, and where can you get it?
1. Create a solid plan
Your business won’t be successful without a solid plan in place. Without one, you won’t be able to secure capital to get on your feet.
“Every successful business transaction starts with a carefully developed plan,” Jeffrey Hayzlett writes in a September 2017 article for Entrepreneur.
Hayzlett says that a good plan should identify the problem your business is trying to solve. It highlights the unique features that make your service or product stand out. Use these to build a short pitch. You should identify future milestones and then estimate how much capital you will need to meet them.
Without a solid plan, potential investors won’t have any reason to believe they can trust you and your business with their funding.
2. Friends and family
Borrowing money from friends or family is one of the most common ways to raise capital for a new small business. However, many investors shy away from it. After all, the potential cost of failure isn’t just financial; it’s personal. The key is to present your pitch professionally and treat your friends and family like real investors. This will make things go more smoothly if you are turned down.
On the upside, that personal relationship can take you further than you could go with an unfamiliar investor.
3. Crowdfunding
Crowdfunding is an increasingly popular way for small businesses to raise capital money to get started. Websites like Kickstarter and GoFundMe let you solicit funds through online campaigns. In return for their money, donors receive services or products related to the project you are trying to launch. The value of which is based on the amount donated.
4. Angel investors
Angel investors are individuals with deep pockets who will invest in your startup in exchange for a higher rate of return than traditional investors.
Companies like Google and Yahoo, received help from angel investors in their early stages. “The big advantage is that financing from angel investment is much less risky than debt financing,” Susan Ward writes in an October 2018 article for TheBalance’s Small Business. “And, most angel investors understand business and take a long-term view.” You can find angel investors on websites like New York Angel and Angel List.
These are some of the ways you can raise capital for your business. Others include credit card loans, personal business loans, SBA loans and microloans from nonprofits. Talk with a professional to explore all of your options.
7 Money Saving Tips You Must Know Before Valentine’s Day!
Valentine’s Day is just around the corner and before you get together and celebrate Valentine’s Day with your significant other, remember it is saving, not spending what helps you create a future as a couple.
If you struggle with saving, or want to save even more than you do already, here are seven strategies worth implementing.
30-day rule
According to The Simple Dollar contributor Trent Hamm, one of the simplest ways to avoid impulse purchases is to apply the 30-day rule. As it implies, this rule involves waiting a period of 30 days to decide on whether or not to make a purchase. Observing this rule each month is a great way to build a long-term habit of making delayed purchasing decisions.
Stick to your shopping lists
Whether you’re grocery shopping or clothes shopping, an easy way to avoid unplanned purchases is to make a list, as Hamm advises. Make sure to stick to the list and turn a blind eye to anything not on it.
As a result, this list will help you buy only the food and clothing you need, rather than splurging on junk food that you might not eat or trendy apparel that you might only wear a few times.
Have a night in
While having a night out with your partner or friends for Valentines or any occasion can be refreshing, it can be a pricey habit.
With that in mind, Hamm recommends limiting evening outings by opting for alternative entertainment and food at home. Try having a game or trivia night, or an appetizer potluck, with friends the next time you crave a get-together.
Pay down your debts
School loans and credit cards can have high interest rates that add up over time. Kimberly Palmer, contributor with U.S. News & World Report, advises to pay down your debts as soon as possible to maximize savings.
If you’re not sure where to start, begin with the loans or accounts that have the highest interest rates.
Take advantage of Money Market Accounts and Certificate of Deposits
An excellent way to grow your long-term savings is opening a Money Market Account or a Certificate of Deposit. These accounts grow at a set rate without the risk of a crashing stock market.
If you own a business, this is the perfect way to save for your taxes. Money Market accounts are liquid, giving you more access to your money.
Use automatic deposits
Put modern banking methods to use by setting up automatic deposits into your savings account, each time you get a paycheck.
Per Former Balance writer Joshua Kennon, it’s an easy way to stay on track with your saving goals.
It’s also a good idea to have the savings account with a separate financial institution than your checking account, as Michele Lerner with Money Crashers recommends. That way, it’s a bit harder to access the funds for non-essential items, the next time you feel like making an impulse buy.
Make your own meals
Frequently eating out can take a toll on your savings. Palmer recommends cooking your own meals regularly, to reduce monthly food costs. She also suggests implementing budget-friendly dishes — like soup and pasta — into your meal plan, to save even more money.
By applying these seven tips, you’re well on your way to a more lucrative new year — and building healthier financial habits that will pay off in the years to come.
How to Choose The Right Business Loan
How to Choose The Right Business Loan
Sometimes, your company needs a hand getting by when the market changes or unexpected costs arise.
During this situation, a business needs a bigger boost to push it to a new operating level. In both instances, short- and long-term business loans are helpful. Learn more about these two loan options and the best time to apply for one.
Short-term loan basics
As the name implies, short-term business loans don’t stay on the books for long.
According to Rosemary Peavler in an article for The Balance Small Business, these loans usually last less than a year, with some terms as short as 90 days.
These smaller loans are great for businesses that need to build up inventory for busy times.
For instance, a retail shop might apply for a short-term loan to buy Christmas inventory in the fall so they’re ready when the holiday season strikes.
A manufacturing business that needs to pay for supplies before production begins might also use a short-term loan to help them get moving and bring money in.
Long-term loan basics
While short-term loans are for quick infusions of cash, long-term loans are for much bigger projects. According to NerdWallet, these loans are best suited for a business making a major investment or expanding.
Long-term loans have more options, with some of them having terms up to 10 years.
While a business (and its owner, depending on its structure) needs to be in good order to qualify for either a short- or long-term loan, long-term loans are much harder to qualify for. The benefits of a longer loan period include lower interest rates and smaller monthly payments.
Which one to choose?
Choosing between short-term and long-term loans is fairly simple, as it depends on how quickly your business can pay back what you owe.
If the money from a loan is more of a bandage solution until you get more capital, a short-term loan is probably the right choice.
However, if your business needs a lot of cash to pay for something that might not produce income for a while, a long-term loan is a better option.
Another thing your business should consider when looking at short-term and long-term loans is which one you qualify for and how expensive it is to borrow that money.
If your business is NEW!
If you are a start-up business you may qualify for a short-term loan more easily than a long-term loan. The funds might be enough to get you going, but the higher interest rates might make repayment harder than looking for other sources of cash.
If your business is long-standing
If your business qualifies for a loan with a longer term and is comfortable committing to payments spread over several years, the interest rate — or cost to borrow money — tends to be lower.
Choosing the right small-business loan is difficult, especially if an enterprise qualifies for different types. If there is any question about which term is best, consult your financial or business advisor.
4 Business Management Skills You Need to Remember
Do you remember the time your business started making profit?
The time you realized all your hard work had finally paid off. We are here to remind you of this moment because there are key business management skills you need to maintain and never forget as your business flourishes.
1. Learn to listen to expert advice
The thing about owning your business is that you learn a lot and it becomes more difficult to listen to experts. This “know-it-all” syndrome can severely deter you from achieving your long-term business goals. Listen to the experts because they can see your business from a neutral perspective. They can tell you when something is working and when something needs to improve. Surround yourself with experts you trust. They may not always tell you what you want to hear, but they will advise you on what is best.
2. Separate your business finances and your personal finances.
Managing your finances properly is essential to keep things running smoothly. Make sure you are budgeting separately, saving separately and spending adequately. Make sure, you have a “salary” for yourself and pay yourself first. A huge common mistake is to reinvest all your earnings into the business you are running. Although, that might be great for a short-term investment strategy, it does not account for your personal financial well-being. You have to anticipate you will not be running your business forever, for this reason you need to have your own personal savings.
3. Learn the tax deductions that apply to you
Make sure you have a “Tax” expert look over your business finances and make sure you are paying as little taxes as required to. Most small businesses qualify for a 20% “Pass-through deduction. The deduction is generally available to eligible taxpayers whose 2018 taxable incomes fall below $315,000 for joint returns and $157,500 for other taxpayers. Additionally, some business might be able to claim their vehicles. If this is you, get some information about how to get Free Gap Insurance and take advantage of BSCU perks.
4. Stay Liquid and plan accordingly
Bad times happen to everyone, make sure you are prepared for them. Make sure you keep at least 6 months of liquid reserves at all times. Make sure you are also set with the proper protections and have a plan set up for emergency. Ask yourself the following; Do you have disability, health insurance and life insurance set up? If not, time to make adjustments.
We hope this helps!
6 Smart Financial Choices You Should be Making
The world is a revolving door of bills, savings, spending and decisions. When we talk about financial wellness, we don’t usually talk about millions. We talk about living within your means. This means you have to make financial choices that will benefit you. For example:
- Create an emergency fund
Every single one of you, regardless of how much you make should have an emergency fund. Unfortunately, more than 50 million Americans forget about this very important financial choice.
This very important aspect of savings will help you take care of unexpected life events that will require you to spend money. The last thing you want when an emergency arises is stress about money. This fund will help you get to your next step easier.
- Embrace minimalism
Do not spend money on things you don’t need. Yes, you may treat yourself once in a while but if you are going out every weekend or changing your house décor every 2 months; STOP!
Take a step back, breathe and ask yourself “Can you live without this?” If the answer is yes, then put your credit card/cash back. We cannot stress this enough; you must live within your means. Once you start doing this, you can actually start achieving other goals like traveling, saving for a home and go on a shopping spree without having a huge financial strain.
- Make your money accrue interest
Growing up I heard everyone older than me say that financial stability came along when you figured out a way to make your money make own its money. CD’s and Money Market Accounts are the perfect way to make your money accrue interest by just letting it sit. It is also the perfect way to get disciplined with your savings. CD’s and Money market accounts are also a guaranteed way to make money because they do not rely on the stock market to grow. You just need patience.
- Change your insurance
We briefly mentioned changing your insurance on our “How to Make a proper Budget” blog. The internet has made research easy. Changing your insurance is research you should be making. See how you can take advantage of discounts, promos and benefits that can help you reduce the cost of your insurance.
- Save money on gas
Gas is one of those little things that makes a difference. If you live anywhere in Florida, you are spending money on gas. A way you can start saving on gas is buying or switching into a smaller car. This may not be possible if you are a parent or have a big family, but if this is not something you need…CHANGE IT!
- Find ways to make extra money
Making a little extra money is smart- especially when you want to treat yourself a bit more. You can use APPs and websites like eBay, Offer Up and Facebook to sell gently used items. You can open a separate Savings Account to add the little extra money you are making. The extra dollars can help you pay for a plane ticket and help you pay for a vacation. It can also make it easier to grow your Emergency Fund.
Try to follow these tips to help you make better financial choices. It is the little changes that make a difference in your financial well-being.
How to use your CD’s for Savings
The advantages and drawbacks of putting your money in a certificate of deposit
From savings accounts and money market accounts to stuffing cash into a jar in the cabinet or beneath the mattress, there are a wide variety of ways to save your money. These options offer varying advantages and drawbacks, but what they all have in common is the idea that you can withdraw your money as soon as you wish. If you have funds that you want to squirrel away without the temptation to dip into them, consider putting the money into a certificate of deposit.
What is a certificate of deposit?
According to NerdWallet’s Tony Armstrong, a CD is a kind of savings account that typically offers a fixed interest rate and fixed maturity date. Insured by the Federal Deposit Insurance Corp. for up to $250,000, CDs are considered extremely low-risk savings alternatives. The advantage to leaving the money in your CD for a full term, which Armstrong says typically ranges from three months to five years, is that it will accrue interest over that period, offering a significant return on your investment.
Saundra Latham, contributor at The Simple Dollar, writes various different types of CDs are worth considering. A traditional CD is the most common variety and offers fixed interest rates, but if you prefer a bit more risk you can also opt for a variable-rate CD which will adjust to the market rate. There is also a bump-up CD, which allows you to opt into a higher interest rate if one becomes available during your term. If you have a larger amount of money to put away — think six figures or more — a jumbo CD pays out a higher interest rate than the traditional option.
When a CD won’t work
A CD requires the full term to pass before you can withdraw funds (without paying an exorbitant fee), so it might not be a sound option if it is your only means of savings. CDs are attractive because they tend to offer higher interest rates than savings and money market accounts, but they don’t offer the same flexibility when it comes to making sporadic withdraws for emergency situations. Margarette Burnette of NerdWallet suggests a high-yield savings account might be a preferable alternative if you aren’t positive you could go for a fixed term without the money.
A CD also might not be your investment of choice if you want a higher risk-reward proposition. CDs are generally safe additions to your portfolio if you want something reliable to fall back on, but if you prefer more aggressive investments with potentially bigger payouts, CDs likely aren’t going to be the focal point of your financial strategy.
How to maximize your CDs
The “laddering” technique is a common approach to getting the most out of a CD. The Wall Street Journal’s how-to guide on CDs puts it as such: “Let’s say you want to invest $15,000. By laddering, you would invest $5,000 in a one-year CD, $5,000 in a two-year CD and $5,000 in a three-year CD. Then, each time one of the three CDs matures, you would either take the cash or re-invest it in another three-year CD to keep your ladder in place.”
This strategy enables you to continually collect interest and opt into higher interest rates if they are available at the close of a term. If you keep this method going continuously, you will allow yourself the option of having a chunk of your CD savings at your disposal every year. This way, you can decide whether you need the money for an emergency or investment opportunity while the other CDs in your portfolio continue to accrue interest.
Investing in CDs is a safe, solid financial decision if you have the patience to bear it out. To determine whether a CD is right for you, talk to your financial advisor to learn more about the risks and rewards.
How to Adjust Your Savings When Your Income Changes
Have you ever heard the phrase “The more you make, the more you spend” If you have and live by this mantra then you are doing it wrong!
An increase in your income does not mean you need to up your shopping list, it means you need to increase your savings.
Basically, if you have been making living on $45,000-a-year and you have been paying rent/or mortgage and paying your bills on time, there is no need to increase your spending. We are not saying you cannot treat yourself once in a while. However, you do have to make smart decisions and be conscious of the fact that a big emergency fund matters and can help you when you need it most.
Keep the following tips in mind if you are getting a raise soon:
- Do not spend more
If you earn a raise or bonus, congratulations you deserve it!
Just be careful, most people become trapped in a spending circle with no money saved up for the future. Take a look at the goals you are trying to reach, be ready for unexpected expenses that may come up and be comfortable without exceeding your means.
- Grow or Create an emergency fund.
Your emergency fund should cover a minimum of 3-months expenses. A good emergency fund covers 6 months of expenses easily. Make this one of your goals! Do not use these funds for a vacation, a wedding or leisure time. An emergency fund, as the name suggests, it’s only for emergencies. For example, an emergency fund can be used for an unexpected hospital bill, car issues or job loss.
- Create a separate savings account and make the funds transfer automatically
If you don’t see it, then you don’t need to spend it. Additionally, if your income shirks, the savings you have should help you carry you thru. A BrightStar Savings Account is completely FREE and it does not require a minimum when it’s coupled with a FREE Checking Account. What better way than to save money in a reliable credit union?
Do not forget the essentials of saving, living in moderate means, and to plan accordingly.
3 Ways to Help Your Teens Build Good Credit
When your teen finally takes the big leap and moves out of the house, they’re going to need a solid credit score for a lot of life steps: renting an apartment, getting a loan or finding a good deal on insurance.
For that reason, it’s important that teens build up their credit scores before they move out. There are a few ways you can prepare them for this in the years leading up to graduation.
- Make sure they have a checking account and debit card to go along with it
Getting your teen started with their own bank account is a significant step in building their credit score without ditching their safety net. A teenager under 18 years old can still sign up for a debit card; they just need a co-signer. Since you are co-signing on the card, your personal account will be linked to your teen’s in case of an overdraft. With this checking account and debit card, you should also teach your teens the importance of managing money well.
- Teach them the credit card basics
Credit cards are a bit more complex than debit cards, so it’s important to sit down your teen and help them understand the basics. Signing them up for their own credit card is a bigger step than signing up for a debit card, but it’s an additional step that will help boost their credit score — assuming they pay the bills on time and in full. U.S. News & World Report contributor Amelia Granger says that the most critical skill a teen can learn is to pay their bills in full, even if that means starting with a smaller credit limit. Make sure you are monitoring your teen’s bills to confirm they’re not damaging their credit score rather than building a good foundation for the years ahead.
- Help them open a Secured Credit Card
A Secured Credit Card is the perfect card to teach your teen how to properly manage money. It does this by not allowing them to use the money they don’t have, instead locking in a minimum amount of $500 they must use as if it were borrowed money from the bank. This card will help them improve their credit score and after a year they will be able to apply to a regular credit card.
Responsible money management is tough to practice if you learn it late in life. Your kids will be much better off by teaching them good financial practices.