Tag: money tips

Doesn’t it sound unbelievable that someone holding as many as seven Mr. Olympia titles and five Mr. Universe titles didn’t make his first million dollars through acting?

Yes, it does sound unreal, but not when you consider someone as versatile as Arnold Schwarzenegger. The Austrian-American has set benchmarks when you look at him through the lens of wealth creation! It was much later, after he made his first million dollars that he ventured into bodybuilding, acting, modeling, sports, business, and now politics!

With his net worth close to $450 million, Schwarzenegger has soared in popularity across the globe. Who’d forget his trademark role in the movie Terminator or the 1982 Hollywood hit Conan the Barbarian?

Arnold Schwarzenegger has inspired wealth creators and young investors across the globe. When you look at him beyond what he’s popular for, you’d wonder how crucial early-life financial investments can be!

Who is Arnold Schwarzenegger?

Arnold Schwarzenegger is an eccentric man with a lot of ambition. For someone who has been in sports for more than five decades, besides dominating diverse fields like entrepreneurship, acting, and bodybuilding, versatility and openness to opportunities remain the success formula.

Over the years, we have seen him juggle multiple careers, only to emerge successful in every front he touched. Although his acting career is the prime source of his massive wealth, it’s intriguing that he was into real estate investment early in his life.

At one point in his acting career, Schwarzenegger was privileged to be the highest-paid actor. Apart from the Terminator, he was a part of other blockbusters like the Predator, Total Recall, and True Lies.

Beyond acting, Schwarzenegger made a lot of wealth through his business ventures and participating in bodybuilding competitions. Arnold Schwarzenegger also served as the governor of California between 2003 and 2010.

No wonder he has made the most of an illustrious career that landed him at the pinnacle of success and fame.

How did Arnold Schwarzenegger make his first million dollars?

The Austrian-American was born in Thal, and his father worked as the Police chief. As a kid, he experienced a humble upbringing. Schwarzenegger started working out at a local gym in his teens. He was eight years old in 1965 when he bagged the Junior Mr. Europe Contest title. A couple of years later, he won the first Mr. Universe title.

Schwarzenegger initially had different plans, as he didn’t count on his acting career solely to consolidate his wealth. This is evident from his conversation with the author of Tools of Titans, Tim Ferriss. Over the years, Schwarzenegger has observed people in acting classes as well as the gym.

He realized their financial vulnerability simply because they didn’t make enough wealth. Due to this vulnerability, they were forced to accept any rate offered. Schwarzenegger was serious about not landing in a similar situation and decided to carve out his own financial fortune.

This financial consciousness early in his life made Schwarzenegger turn to real estate in the early 1970s. It was in 1968 that he went to the USA with a meager amount of $27,000, as per Town and Country. Thanks to his foresight and tactical investments in real estate, he made his first million before diversifying his career.

Schwarzenegger channeled the money he earned through bodybuilding to manage the downpayment on a property. It was an apartment building, and he was shrewd enough to invest in an upscale real estate economy in America. Well, the 1970s was a magic decade for the real estate sector, and he was overwhelmed by how property prices increased.

Schwarzenegger purchased buildings for $500,000, and the prices soared to $800,000 in just a year or so. What’s most interesting is that he used to make small down payments like $100,000. This fetched him a 300% return on his investments!

Realizing the tremendous investment potential in the real estate industry in the US, Schwarzenegger was prompt enough to develop buildings and trade them. In the process, he purchased several office and apartment buildings on Main Street down in Santa Monica. No wonder this winning move from Schwarzenegger earned him the first million and paved the way to a happening lifestyle.

Well, it’s worth noting that real estate investments were only a side hustle for Schwarzenegger. However, the impressive returns and growth fetched him the financial freedom he needed. In the process, Schwarzenegger became well-poised to focus on his career in acting. Now, we know how he set benchmarks in his acting career.

Tapping multiple income avenues like Arnold Schwarzenegger

Now that you know how Arnold Schwarzenegger made his first million dollars, let’s check out how he consolidated this wealth and grew his net worth to $450 million.

1. Invest as per your priorities

Schwarzenegger has come down a long way over the years being an angel investor. Funding potential startups, he helps these firms grow at their initial stages. Being picky about where he channeled his funds, Schwarzenegger has been riding the growth potential as these companies bloomed.

Currently, Schwarzenegger’s portfolio has four companies. Dropshyp has been the most recent investment for the actor. The startup connects businesses of small, medium, and large scales to suppliers in the Middle East, West Africa, and East Asia.

Following the suit of the successful investor, how do you plan to allocate your funds? It all depends on how you prioritize your goals.

Here’s a practical way to start investing and diversifying your portfolio across different asset classes. Try to distribute your savings in the following accounts:

• Contribute to your employer’s 401(k) plan to enjoy tax benefits as well as the power of compounding
• Open certificates of deposits (CDs) by locking up funds to manage your short to long-term goals
• Open a high-yielding savings account to counter the impact of inflation
• Invest in US Treasuries Securities and different bonds or bond funds for long-term fund growth
• For short-term growth of your funds, consider investing in a money market account (MMA)
• Invest in exchange-traded funds (ETFs) to get dividends
• Consider investing in dividend-yielding stocks to grow your financial portfolio
• Apart from these investments, one can also consider coupling up as an angel investor.

Back in 1999, Schwarzenegger happened to be an early investor in Google. Some of his other investments include Advanced Microgrid Solutions and Scopely. While the former works on advanced systems for energy storage to reduce energy bills, the latter develops interactive mobile games. According to reports, he has already exited Advanced Microgrid Solutions and Google.

Most of Schwarzenegger’s investments worked in his favor, leading him to success on the financial front. The secret to this success in stocks, businesses, startups, and real estate is proper research and knowledge acquisition on these fronts.

Schwarzenegger also invested in Oak Productions, a production studio. This company produced two movies: The Aftermath (2017) and Last Action Hero (1993). They made a staggering profit of $42 million, with the combined expenses of the two films around $95 million. Such was the foresight and strategy of the angel investor.

Moreover, Schwarzenegger invested in Lobos 1707 tequila, an alcohol company. Currently, there’s no foolproof strategy to verify how much all these investments fetched him. As per reliable sources, the aggregate gains of Schwarzenegger from all these investments are close to $200 million.

While his achievements look staggering, success in the business front comes by starting small. Consider making limited yet calculated investments to capitalize on the potential avenues.

2. Focus on your primary source of income

Schwarzenegger entered acting, his secret behind the massive wealth portfolio early in his life. He gives us a practical example of how professional expertise can lead to financial success. Regardless of the industry you are in, try to create your own identity by excelling in your profession. Remember, Schwarzenegger got the opportunity to be cast in Hercules in New York just after earning his first Mr. Olympia title!

Hercules was a feature film, and Schwarzenegger followed this up with a documentary on bodybuilding called Pumping Iron. Schwarzenegger’s fame started pouring in, and so did his income through his acting career.

Apart from starring in blockbusters like the Terminator, Schwarzenegger gained fame for his documentary Conan the Barbarian. The 1984 hit, Terminator, fetched him a massive $75,000, where he played the leading role. The worldwide circulation of this movie earned him even more, and his total income from this hit is estimated to be around $80,000.

Schwarzenegger returned with James Cameron, the director, and his friend to the Terminator after some time. Besides, he worked on several other blockbusters like The Running Man and The Predator. Besides, Schwarzenegger started in the Expendables franchise, which released three movies to date. Some of his most famous action movies include Total Recall, Commando, and True Lies.

Besides, Schwarzenegger has been a part of some comedy dramas, which defines his versatility. To mention a few, his works in this genre include Junior, Kindergarten Cop, Jingle All the Way, and Twins. Particularly, his role in Twins, the Ivan Reitman movie, earned him 40% of the movie’s overall earnings ($215 million). This implies that the film fetched him around $30 to $40 million.

To date, Schwarzenegger has been a memorable name in the entertainment industry. His estimated earnings from the film industry are close to $300 million. On average, he made $30 million per movie.

Have a look at Schwarzenegger’s earnings from his role in different movies.

• The Predator: $3.5 million
• Commando: $2 million
• Total Recall: $11 million
• Terminator 2 and Kindergarten Cop: $12 million

As Terminator 3 continued to become a hit, Schwarzenegger’s paycheck was hiked. So, when he performed in the Rise of the Machines, the third Terminator movie, he went on to earn $35 million for each film.

3. Invest in real estate

Over the years, real estate has continued to be a lucrative investment avenue. Being strategic about your investment in this sector can earn you a fortune. Unlike stocks, property prices are not volatile. Moreover, with the growth of infrastructure, property prices keep appreciating. Even if you are not comfortable investing massive chunks of your portfolio in real estate, why not start with REITs?

Besides, rental income serves as a recurring source of revenue for investors. Although Schwarzenegger made his first real estate investment back in the 1970s, his investment portfolio continues to earn him generous returns even today. Oak Productions, Inc. is his movie production firm, housed at a Santa Monica building. It currently has around a dozen tenants. Estimated around $10 million, this property is currently one of the most valued possessions of the actor.

Other sources of income

While the above are Schwarzenegger’s primary sources of income, he didn’t completely rely on them. Here’s how he carved out other income sources.

1. Bodybuilding

Schwarzenegger came across a bodybuilding magazine in his early teens. This sparked his interest in bodybuilding. His interest gave way to obsession, and he lifted the first barbell as a 13-year-old kid. No wonder why he won his first bodybuilding competition just at the age of 18. A decade later, he became the youngest person to win Mr. Olympia.

Schwarzenegger never looked behind and went on to win as many as seven Mr. Olympia titles. Besides, he emerged as the winner in five Mr. Universe competitions.

Back then, bodybuilding competitions didn’t bring winners large prize pools. However, Schwarzenegger acknowledged that it wasn’t money for which he participated in bodybuilding. After Schwarzenegger won Mr. Olympia, he received $750. In those days, this meant a lot of money.

2. Sports ventures

Well, Schwarzenegger has got a sports festival to his name, “Arnold Sports Festival‘. This is a four-day sports festival that fitness and sports enthusiasts in Ohio attend every year. Schwarzenegger has been hosting this event since 1989.

Later, countries in South America, Europe, Australia, Africa, and even the UK organized this event. According to estimations, the festival draws an annual amount of $2 million, given that 20,000 people attend the event. The rights of the event have the potential to earn up to $10 million.

3. Personal brand

You might not be aware, but Schwarzenegger co-founded Ladder, the Food Products company, along with Lebron James. All these years, he has demonstrated how good he is when it comes to investments.

As per reports, Schwarzenegger’s objective is to supply quality supplements and nutrition to gym enthusiasts and sportspersons. Well, this company was sold in 2020, but Schwarzenegger made another $50 million while it remained under his control!

4. Endorsements

Arnold Schwarzenegger also earned decent cash through his endorsements. He starred in some commercials for Machine Zone, the prominent game developer coming up with Mobile Strike and other popular games. In this commercial, Schwarzenegger plays the role of a military commander.

Besides, Schwarzenegger appeared in the 2022 commercial for BMW Super Bowl. He also makes a decent earning through his product endorsements. Over the years, he has collaborated with companies such as DirecTV, Nissin’s Cup of Noodles 7Up, and Bud Light for endorsement programs.

His tentative income from all his endorsements comes to around $20 million.

How can you channel income from multiple sources?

As you embrace a progressive career, focus on growing your income exponentially. Apart from streaming in maximum income from your primary source, it’s imperative to have multiple income sources, including passive income sources. Suppose you get a few side hustles and manage to supplement your primary income source. Once this grows consistent, simply channel a part into mutual funds.

Besides, we have already mentioned several investment avenues, including real estate, stocks, bonds, and a wide range of savings accounts. Capitalize on the power of compound interest to maximize your savings for the future.

The secret to Arnold Schwarzenegger’s wealth accumulation lies not only in profile diversification but starting investments early in his career. Be it real estate or working as an angel investor, Schwarzenegger didn’t fail to seize any opportunity. Foresight, along with his click of luck, fetched him financial success in every avenue he explored.

Even today, real estate continues to be one of the most-sought avenues for investors around the globe!

The post Arnold Schwarzenegger Gives His Easiest Way to Make a Million Dollars appeared first on Due.

American universities continue to rank among the most revered academic institutions across the world. The industry-oriented curriculum and sophisticated academic infrastructures in these institutions generate some of the highest-paid graduates. It’s logical to compare the median salary of graduates in the first place before delving into other particulars.

According to the National Association of Colleges and Employers, the average starting salary of recent college graduates was $55,260. So, it makes sense to settle for something above the national average, right?

International students in the US shell out around $99,417 throughout their degree courses. For American students, this value might be marginally less. Graduating from one of the esteemed institutions in the US brings you the prospect of bagging a lucrative salary package. Naturally, you would wonder which college or university can deliver you the true value for your money.

Top colleges in the US based on graduates’ salaries

Let’s take a look at some of the leading colleges in the US specializing in different streams. We have shortlisted only those institutions that recorded above-the-average graduate salaries.

1. Massachusetts Institute of Technology (MIT)

Fresh graduates from MIT have an impressive median salary of around $76,900. This institute specializes in STEM subjects. The QS World University Rankings reveal that MIT continues to be one of the top international institutes offering quality education in Engineering and Technology. Besides, it emerged as the topmost global university as per the QS World University Rankings 2023.

Studying at MIT requires students to shell out a sizable fee, and that’s well-justified by the superior academic infrastructure and salary packages graduates enjoy. The acceptance rate of this institution is just 4%. Well, that tells a lot about the maturity students need to qualify for a berth here.

Besides, MIT regularly hosts events such as the Polymer Day, a European career fair, and an analytics career fair. Students here have an 88% chance of completing their graduation in 4 years. The student-faculty ratio looks very healthy at 3:1. 70% of the classes at MIT have fewer than 20 students.

31% of the students at MIT graduate with Computer Science. The average starting salary of these students is $104,600. 11% and 9% of the students graduate with mechanical engineering and mathematics. Their average starting salaries are $80,400 and $82,900, respectively.

2. Princeton University

The median starting salary at this leading Ivy League University in the US is $66,700. The versatility of its academic infrastructure makes it a top choice for students across all disciplines. As per the QS World University Rankings 2023, Princeton University emerged in the 16th position. Some disciplines that make Princeton University highly sought-after include engineering, social sciences, biology, and computer science.

One of the prime reasons for the popularity of this university is its tactical location. Students from Philadelphia and New York City can seamlessly navigate to the institute.

Princeton University has as many as 37 sports clubs and 300 student organizations. Besides, the students here enjoy a vibrant campus life with 15 chaplaincies. Being one of the leading national universities in the US, Princeton University accepts just 4% of its applicants.

The student-faculty ratio at Princeton University is 5:1. Around 76% of the classrooms have fewer than 20 students. This demonstrates that the aspirants get personalized attention from the faculty.

20% of the graduates from Princeton University specialize in social sciences and enjoy an average starting salary of $70,200. 16% and 13% of students graduate in Engineering and Computer and Information Sciences and Support Services. Their starting salaries are $76,000 and $99,400, respectively.

3. Carnegie Mellon University (CMU)

Aspiring to specialize in engineering, business administration, or computer science? Carnegie Mellon University will be a good choice if you are likely to establish a career in any of these streams. With a median annual salary of $69,700, graduates from CMU are flying high in their respective careers.

CMU ranks first for their Undergraduate Computer Science and Graduate Information Systems courses as per the US News and World Report. Overall, it is ranked fourth among engineering colleges in the US in 2021.

The Oakland campus of CMU grants its students excellent exposure to small business entrepreneurs, tech companies, and startups.

In terms of acceptance, CMU is a bit more generous compared to the other colleges we listed in this article. The average acceptance rate of this institute is 14%. The student-faculty ratio of 6:1 looks pretty good.

13% of CMU students graduate with Computer Science and enjoy an average annual salary of $102,500. Another 9% study Electrical and Electronics Engineering, while 10% go for Business Administration and Management. These two groups of students bag salary packages of $78,100 and $68,500 on average. Those majoring in Systems Science and Theory get even more, around $103,700 a year.

4. Thomas Jefferson University (TJU)

Graduates passing out from Thomas Jefferson University bag impressive salary packages, with the median close to $66,300 a year. The inter-professional approach to education is what this institute is known for. Students majoring in exercise science, nursing, health, midwifery, and physical therapy usually go for this esteemed institution.

The university specializes in designing masters and certificate programs in emerging healthcare fields. Some of the comparatively newer courses offered by TJU include cardiovascular perfusion, integrative health, telehealth, and connected care.

Thomas Jefferson University is generous with its acceptance rate, accepting 78% of its applicants. The student-faculty ratio stands at 13:1. Also, 60% of the classes at this institute have less than 20 students. Therefore, the aspirants can expect the much-needed individual care necessary to specialize in healthcare fields.

5. Rensselaer Polytechnic Institute

With a median starting salary of $66,000 and tuition fees around $58,526, studying at this polytechnic college seems to be a good bargain.

Located in New York, Rensselaer Polytechnic Institute is known for its industry-oriented programs in engineering technology, computer science, engineering, mathematics, and business and management. This college offers research opportunities in experimental media, performing arts, and biochemical solar energy.

Among the national universities, Rensselaer Polytechnic Institute ranks 51st. However, graduates from this college have consistently bagged impressive salary packages at reputed organizations. What’s good to know about this institute is that it accepts around 53% of its applicants.

55% of the classes at Rensselaer Polytechnic Institute have less than 20 students. The average student-faculty ratio at this institution is 13:1. The 4-year graduation rate stands at 70%.

51% of the students studying at Rensselaer Polytechnic Institute choose the engineering field. The starting salary of the alumni is $72,300 annually. Computer and Information Sciences and Support Services is another popular domain, attracting 19% of the students. Graduates in this field earn even higher, around $84,800 a year.

6. Stevens Institute of Technology

When you consider anything above the average annual salary as impressive, Stevens Institute of Technology makes its way into our list. This college, located in New Jersey, boasts an impressive median annual salary of $67,000.

New Jersey, as you know, is the hub of technology. The strategic location of the college gives its students direct exposure to the industry. Whether you want to specialize in welding and laser cutting or 3D printing, the industry-oriented curriculum of Stevens Institute of Technology makes it happen.

Apart from mechanical engineering, students attend computer engineering, computer science, business administration, and chemical engineering courses at the Stevens Institute of Technology.

The college has a decent ranking, and its acceptance rate looks great, at 53%. Around 39% of the classes have fewer than 20 students. At Stevens Institute of Technology, the student-faculty ratio is 12:1.

Among the graduates, 16% come from the mechanical Engineering Stream, while 14% come from the Computer Science domain. Their annual starting salary stands at $70,000 and $ 77,400, respectively. 12% of the graduates specializing in Business Administration and Management enjoy annual salaries of around $71,800. Besides, Computer Engineering and Chemical Engineering account for 8% of the graduates each. The annual salary of these graduates also lies in a similar range.

7. Worcester Polytechnic Institute

Worcester Polytechnic Institute is a popular college for engineering students, given that the average graduate earns $67,300 as the starting salary. This Institute won’t disappoint you if you are keen to specialize in engineering domains such as mechatronics, electrical, biomedical, and mechanical engineering. 

Apart from the modern infrastructure, this polytechnic college is known for its career outlook information and career fairs. Besides, students also specialize in other fields, such as physics, civil engineering, professional writing, and psychology at this institute.

The acceptance rate of Worcester Polytechnic Institute is 60%. This implies that getting an admission at this revered polytechnic college wouldn’t be too challenging. The college boasts a healthy 4-year graduation rate of 81%. Besides, 67% of its classes have fewer than 20 students. The student-faculty ratio at Worcester Polytechnic Institute is 14:1.

Mechanical Engineering and Computer Science are two of the most sought courses in this college. While 19% go for Mechanical Engineering, 16% go for Computer Science, bagging an average annual salary of $72,500 and $83,900, respectively. Bioengineering and Biomedical Engineering graduates make around $69,900 annually, while Electrical and Electronics Engineering graduates earn $78,400. Students graduating in fields like Mechatronics, Robotics, and Automation Engineering earn well above $71,000 a year.

8. Colorado School of Mines

Colorado School of Mines has a decent annual ranking in the US. With a median annual salary of around $68,000, this is yet another reputed college to enroll in. Every February and March, students can attend career fairs hosted by the institute. This exposes them to hundreds of government agencies and companies. Engineering fields such as petroleum, mechanical, electrical, and chemical engineering are the most popular streams in this college.

At Colorado School of Mines, the acceptance rate is around 57%. So, you stand a fair chance to get yourself through. Around 28% of its classes have fewer than 60 students. The student-faculty ratio is 16:1, while the 4-year graduation rate of this educational institute is 67%.

Mechanical Engineering is the most-sought course at Colorado School of Mines, with 28% of its students enrolling in this course. The average starting annual salary of its alumni is $68,900. Computer Science and Chemical Engineering are two of the other popular programs at the Colorado School of Mines, accounting for 14% of the student population each. 

Graduates in these streams earn around $73,200 and $76,900 annually. Even Electrical and Electronics Engineering graduates make $ 76,500 a year, while Civil Engineering graduates earn an annual salary of $67,700.

Endnote

We have recommended some of the topmost institutes in the US based on the average annual salaries of their alumni for your convenience. As you note, all these graduates make much more than the national average. Moreover, we have included colleges and polytechnic institutions in our list to cover different fields of expertise. So, whether you wish to venture into business administration, engineering, or healthcare, you can choose the best institution.

FAQs

Are US colleges good for engineering courses?

Yes, the US has some of the best global colleges specializing in engineering courses. The world-class infrastructure, practical modes of training students, and industry exposure make these programs ideal for aspirants.

How to choose the best college in the US?

Depending on your field of interest, you need to choose the best college in the US. You can use parameters like cost-effectiveness and infrastructure while selecting the best college in the US. A university with a decent acceptance rate and a median salary above the national average is a good choice in any scenario.

Do I get placement from US colleges?

Yes, most colleges in the US offer placement facilities to deserving students. These institutions have partnership programs and tie-ups with reputed companies in their respective fields. This opens up lucrative job opportunities for their students.

How difficult is it to get into top US colleges?

The admission criteria largely vary among the top colleges in the US. The field of your interest and the corresponding demand for the program also determines the acceptance rate. In general, reputed US colleges have an acceptance rate of more than 50%. However, some institutes, like Massachusetts Institute of Technology and Princeton University, have an acceptance rate below 5%.

Why are US colleges so expensive?

Most of the reputed US colleges are expensive as students can enjoy quality education. Right from the campus to the academic infrastructure, the facilities look outstanding. Besides, graduates enjoy lucrative salary packages in their respective industries. These perks justify the high fees at US colleges.

The post Here’s the No. 1 College for Average Americans That Has the Highest Starting Salary Among Graduates appeared first on Due.

Biden has always pretended to pay attention to rebuilding the lop-sided economy of the United States. He has always stuck to the idea of redesigning economic practices to make them worthy for ordinary Americans. Instead of developing a top-down economy pyramid, Biden claims to turn it bottom-up and middle-out, which reflects in the new budget. According to the President, if the middle class does well, the poor will have a ladder up, and the rich will be able to uplift their financial flourishment.

Biden also says that the economy of the United States could be grown healthily by creating well-paying jobs and lowering costs by promoting workers and investing in people. The President also claims that he wants to reform the tax code to reward work instead of wealth.

However, from the point of reality, Is Biden’s new budget and wage-class welfare truly working? Will they cater to the middle class, or is it another hit on the pocket? How should you prepare for the newly proposed policies? This post answers everything involved!

Prelude

Biden’s first trial to achieve a noteworthy economic victory was the American Rescue Plan Act (2021). This $1.9 trillion coronavirus rescue package aimed to drive the United States to recover from the post-pandemic economic and health turbulence. It’s said to be a part of his Build Back Better Plan, including the American Families Plan and American Jobs Plan. However, the plans couldn’t pass Congress, and some were covered by the Inflation Reduction Act (2022).

Presently, the United States is combating the pandemic and Ukraine war-induced inflation. Though the reported record high in inflation (2022) has declined significantly, high-priced goods and services are still squeezing the wellness of the country’s economy.

Joe Biden’s Updated Policy Goals

The Biden government has proposed to:

• Increase the minimum hourly wage to $15
• Release Covid-19 relief
• Forgive student loan debt and offer free college education for people earning less than $1,25,000/year.
• Design Affordable Care Act and offer 97% of US citizens health insurance coverage.
• Increase the tax revenue (up to an additional amount of $4 trillion) by raising the top tax rate to 39.6%. The capital gains will be taxed at regular rates while the corporate tax rate will rise to 28%.

Understanding the American Rescue Plan and Its Effect on Middle Class

This Covid-19 stimulus plan was introduced on 14th January 2021 and came into effect on 11th March 2021. The plan promised a $1400 stimulus check, a vaccine rollout, extended unemployment benefits, etc. The plan features several primary elements. They include the following.

1. Taxes

The American Rescue Plan proposed to raise approximately $4 trillion in additional revenue over ten years. Households making over $1,70,000 will bear most of the proposed tax increment burden. In contrast, the top 1% will bear a significant tax load in the next quarters.

The changes that kicked in include but are not limited to the following:

• An increased top income rate of 39.6% (2.6% high than the previous rate)
• A closure in the step-up-in-basis loophole
• An elevated corporate tax income of 28%
• Implementation of Social Security Payroll tax for people earning more than $400k a year
• A 15% tax implementation on the record income of giant organizations

2. Direct Aid

This part of ARP is worth $1 trillion. It proposes to include $1400 checks sent to individuals earning less than $75,000 (separate filers – single or married) and $1,50,000 (joint filers). These checks were designed to supplement the previously mailed-out $600 checks.

Furthermore, the direct aid part included additional funding for eviction, emergency rent, emergency assistance for homeless people, mortgage assistance, etc. However, presently the evictions and foreclosures have expired. The rental and mortgage payments are still available. In addition, under direct aid, there is a childcare and food program.

3. Cyber Security Updation

When modifying the economy, Biden realized the importance of safeguarding digital assets and data. Thus, he proposed allocating $9 billion to modernize and secure Federal Information Technology. However, Congress approved around $2 billion.

4. Health Insurance

Biden’s healthcare initiatives proposed the expansion of Obama Care to insure 97% of Americans. The total cost will be $750 billion in the next ten years. Biden wanted to launch a public health insurance alternative like Medicare which doesn’t require any premium, and people who don’t have Medicaid can also access it.

5. Student Loan

Biden wanted to make education free for everyone earning less than $1,25,000. He wanted to fund this plan by repealing the high-income tax cut in the Coronavirus Aid Relief and Economic Security Act (Cares). In addition, Biden also proposed to forgive all student loans from 1st January 2021 to 31st December 2025.

6. Improve America’s Manufacturing and Technological Strength

Though this is not a technical element of ARP, Biden proposed a $700 billion plan in 2020 to elevate America’s manufacturing and technological strength. This included spending $400 billion on US goods and services and $300 billion on research and development.

7. Rural America

To help rural communities that account for 20% of the US population, Biden proposed an investment of $20 billion. The areas include agricultural research, rural broadband infrastructure, farming, health services, medical training programs, etc.

8. Local Community Support

Biden’s plan aims to help governments with revenue shortfalls by keeping frontline public workers on the job. In addition, it will have small business grants and loans. Besides, $20 billion will be allocated to public transit agencies.

9. Infrastructure and Climate

Biden has planned to spend $1.3 trillion for infrastructural development over the next ten years. This will include road repairs, highway and bridge modifications, clean energy research and innovation, electric car battery technology advancement, and transit projects to serve high-poverty areas.

The 2023 Biden Budget

After ARP, the Biden government came up with the 2023 budget. The Biden administration released the budget request on 28th March, which called for $5.8 trillion in federal spending and a $1.2 trillion deficit. In addition, it includes $1.6 trillion in discretionary spending. The key takeaways of the new budget include the following.

1. Deficit Reduction

The Biden administration has appealed to moderate democrats in response to their negotiation on broader social spending. It has proposed to reduce deficit spending by $1 trillion in the next 10 years.

2. Climate Initiatives

The climate initiative proposal of the 2023 federal budget proposed to back $6.5 billion in loans to rural electricity providers. This initiative aims to promote clean energy, support energy storage, and increase the department’s funding for renewable energy development by 150%. In addition, there is a proposal to allocate $5 million for climate adaptation.

3. Health Proposals

The budget has requested a grant of $5 billion. The amount will include investment in cancer and other breakthrough treatment research. Besides, it has proposed an investment of $3.5 billion in mental health treatment.

The Biden administration has proposed to expand enforcement of existing laws requiring insurers to grant equal coverage for mental care as they do for physical care. The government has also asked the US Department of Education to employ more mental health professionals in academic institutions.

4. Domestic Manufacturing

The budget request features an allocation of $372 million for the National Institute of Standards and Technology’s (NIST) manufacturing programs. This initiative is expected to expand domestic manufacturing and remove supply chain issues. However, the budget proposal does not include new funding for the Ukraine war or Covid 19. It features a deficit-neutral reserve fund that will pay for upcoming fiscal plans, though.

How Biden’s Budget Is Expected to Affect the American Middle Class?

Biden’s campaign’s cornerstone was making the middle class racially inclusive. He says that America hasn’t been built by CEOs, Wall Street bankers, or hedge fund managers. The American middle class developed the country’s economy and society. Research suggests that in 2018, 52% of American adults fell in the middle-income group. Their annual household income was 2/3rds to double the national median ($48,500 – $1,45,500).

Compared with other advanced economies, America houses a proportionally smaller middle class. However, despite the Biden administration’s efforts, the country’s middle-class population has failed to find relief. The income disparity in the different middle-class groups is gradually increasing. Only 20% of the middle-income group in the country has managed to recover from the recession, while the remaining 80% is still struggling to achieve financial freedom.

1. Questionable Credits

While the wage class of the United States was expecting the new budget to help cut down poverty and increase disposable income, the true picture conveys an opposite message. Biden claimed credit for the COVID-19 vaccine and the post-pandemic employment surge, but both were largely attributable to former President Trump’s policies. Biden’s plans couldn’t bring any significant positive changes for the middle-class people. They still need to struggle to secure their financial future.

2. Unfulfilled Commitments

The proposed budget claims that more jobs will be created with the expansion in the manufacturing sector. This will further boost worker employment. In addition, they will be entitled to justified pay and conditions. While Biden expects the initiative to cover the job losses after the pandemic, there are wrenching disconnects in his promises and actions. Using clever wordplay, the Biden administration has expanded the definition of “infrastructure” to encompass many areas.

However, in Washington, “infrastructure” has long been synonymous with “pork,” referring to funds dispersed without a clear definition for political gain. These funds often create temporary, low-skilled jobs, as the Biden administration has emphasized in their push for overall employment numbers.

Typically, local construction firms benefit from this type of spending. What sets the Biden initiative apart is its inclusion of “electric and electronic pork,” which essentially benefits his allies in the tech and alternative energy industries by building networks and energy systems to support their businesses. As a result, even social media giants may reap the benefits and become part of the “middle-class family.”

3. Adverse Effects of Elevated Taxes

Raising taxes to the levels proposed by Biden has previously reduced federal revenues and destroyed private-sector jobs. With many small businesses struggling after the pandemic, these tax increases could severely blow the American job market.

Moreover, the considerable expenditure he envisages will likely propel America’s debt beyond 100% of total GDP, a historical high that may create room for defaulting on American debt. The exponential rise in inflation due to this mounting debt will not permit a stimulus package with zero interest rates similar to that of the Obama era.

Consequently, it would necessitate a substantial hike in interest rates, potentially leading to a market collapse and surging unemployment.

How Middle Class Should Prepare to Adapt to the Biden Budget

Overall, Biden’s spending plans are highly perilous. They appear to be an unrestrained shopping spree throughout the progressive marketplace, which is expected to have a disastrous outcome. The much-touted “Biden Boom” could transform into the “Biden Bust.” There are no chunks of relief on taxes or cost of living, which can elevate the financial burden of the middle class.

Given this scenario, the wage class of the United States should start planning their finances wisely. To manage a shift in the proportion of expenses, it’s important to have a more adaptable investment portfolio. The investments should have the potential to be liquidated to pay off a loan, fund a part of the education cost, or be used as collateral for a low-interest loan.

Furthermore, middle-class households should start optimizing the use of physical assets, which include cars and jewelry, and everything acquired through income. This way, they can equip themselves with an anti-inflation shield, which, in turn, may help the wage class adapt to the proposed Biden Budget.

Frequently Asked Questions

Here are answers to some frequently asked questions about Biden’s approach to combat recession and inflation.

1. What is in the US government budget for 2023?

The United States Federal Budget for 2023 includes several key elements. They include $5.8 trillion in federal spending, a $1.2 trillion deficit, and discretionary spending of $1.6 trillion. In addition, the budget focuses on job creation and infrastructure progress.

2. What does America spend the most money on?

The US federal budget usually spends on social security, healthcare, income security, education, and training. Besides, the economy invests in employment, veteran benefits, social services, and defense. On the other hand, the primary revenue sources include payroll and income taxes.

3. How much is the federal government’s support for health programs and services?

The federal government’s provision of support for health programs and services comes in the form of direct spending on programs and services and tax expenditures. In fiscal year (FY) 2023, the federal government allocated $1.9 trillion out of $6.4 trillion in net federal outlays for domestic and global health programs and services, which represents approximately 29% of the total amount,

4. How is the congressional budget set?

Usually, Congress leverages a “budget allocation’ to decide how much money the government should spend and collect in taxes. This plan may also have special instructions called “reconciliation instructions.” The instructions can make budget alteration easier.

The post Middle-Class Just Got Clobbered by Biden’s New Budget and Wage Class Warfare, How To Prepare appeared first on Due.

If you didn’t take an economics class in high school, you might have lived most of your young life not understanding much about investing and the financial world. Picking between different investment tools and understanding concepts like inflation and recession isn’t always intuitive.

If you’re someone who rolls your eyes at your uncle every time he mentions crypto at Thanksgiving but doesn’t understand crypto yourself, you’re not alone. There’s so much about investing that the average person never learns.

This article will hopefully change that for you. Learning to harness the power of investing while young will help you magnify your assets as an adult.

Key takeaways

• Don’t be discouraged if your financial literacy isn’t very advanced. As a young person, you’re learning to manage your income and budget your expenses, which take time to master.
• The exciting thing about investing as a young person is that you have a longer time horizon, so you can comfortably take on more investment risk.
• Use the tools made available to you. For example, if your bank offers automatic monthly contributions to an investment account, it can save you time and make you a more consistent investor.

Why Should I Care About Investing?

Say you’re a young person living in March 2023. You’re living in a world still emerging from a global pandemic, a multi-year disruption to everyday activity that caused a short recession and widespread economic hardship.

Economists are talking about an impending recession, and you’ve heard from friends and family in the tech industry about mass layoffs and workplaces shifting to incorporate artificial intelligence products. Massive changes like these will continue to happen every year for the rest of your life, inevitably affecting you and your finances.

Inflation and recession are natural parts of the economic cycle. As you age, learning to adapt and take advantage of them will become an increasingly valuable skill.

Investing Should be a Habit, Not an Event

Investing at its most basic involves putting money into an asset you hope will appreciate and generate income over time.

You should invest regularly and for the duration of your career. Think of it like a regular line item in your monthly expenses. But unlike your rent or streaming service bill, investing is a way of paying future you.

It’s Not your Grandparents’ Stock Picking Era

The digital age has transformed many things, including how the average investor accesses and monitors the stock markets. While our grandparents watched the stocks via news headlines and calculated guesses with a stock broker, we now have access to various down-the-minute digital tools to help us understand the market and make intelligent investments directly through online platforms.

An excellent first step in improving your investing habits is understanding what digital investing tools are available.

Simple Tools That Can Help You

Automatic Contributions

To invest regularly, you can often set up an automatic contribution through your bank, so money moves from your checking account to an investment account monthly on a date of your choice.

In the same way setting up automatic payments for a credit card statement can save you time and protect you from fees or penalties if you forget, automatic investing contributions can make you a more consistent investor and make life easier.

Reinvesting Dividends

When stocks do well, they pay you dividends. This can be very exciting for investors as it feels like free money. But while it can be tempting to pull out the extra cash to play with, the wisest choice is often to reinvest funds back into a stock to buy more shares.

Take Advantage of Low Interest Rates

Inflation is the devaluation of currency over time caused by an increase in demand or decrease in supply, pushing the price of a commodity higher. As inflation increases, the Federal Reserve’s job is to keep it under control, protecting the economy from breakneck growth.

When inflation is high, the Federal Reserve typically increases interest rates to make borrowing money more expensive. This discourages people from borrowing and spending as much, causing less money to enter the economy.

When inflation turns to deflation and the economy slows down too much, the Federal Reserve lowers interest rates to encourage borrowing and spending. You can do a few things to take advantage of low interest rates.

First, consider buying property. If you’re young and interested in an asset that will hopefully earn you significant passive income, buying a house when interest rates are low and competition is scarce can be a savvy choice.

If you’re lucky enough to have a house already, consider refinancing your mortgage to get a better interest rate. For young people invested in bonds, selling bonds when interest rates are low can also be wise, as bond prices and interest rates have an inverse relationship.

Tax Loss Harvesting

Suppose you invest money in the stock market, buying a share of an individual stock or an ETF, a pooled investment security comprised of multiple assets. And let’s say it’s a particularly tough year for the markets, and your investment loses value. That loss may turn out to be an advantage.

Tax loss harvesting is an investing strategy that can turn some of your investment losses into tax offsets, helping turn financial losses into wins.

Tax loss harvesting is the process of selling underperforming stocks at a loss to reduce taxable capital gains. When you pay taxes on your stock earnings, you only pay on the net profit. You can save some serious cash by selling stocks at a loss to offset your net profit.

Investors can use the money saved on taxes to buy similar investments that have the potential to grow over time. These gains can be offset by future losses, creating a cycle of tax savings.

Drift Rebalancing

Portfolio rebalancing can protect you from being exposed to undesirable risks. It can also ensure your portfolio remains within your area of knowledge. As securities gain and lose value, stock portfolios may drift out of the original asset allocation. This shift can change the risk exposure to different asset classes as well as the portfolio overall.

Rebalancing is a method of readjusting a portfolio’s asset allocations to match the value and levels defined by the initial investment plan. Those predetermined benchmarks help keep an investor’s portfolio aligned with their ideal risk level. Rebalancing involves periodically buying or selling certain assets as they change to adjust the portfolio to the original level of risk.

Use AI to Make a Defensive Portfolio

Some investing technologies, primarily those using artificial intelligence, offer some form of portfolio protection to guard your investments against losses. As AI becomes increasingly prevalent, investment services are learning to harness it to detect and respond to risk in the market. AI can already evaluate market conditions, interest rates, oil prices, and more.

AI can use hedging strategies to offset anticipated adverse impacts. These hedging strategies may include reducing overall market exposure by placing more into cash or investing in hedging assets that can offset losses related to a specific risk.

Be Open to Investment Ideas That Have a Strategy

While it can seem attractive to “go with your gut” on specific stocks and buy anything that “feels good,” investing via a bonafide strategy is more likely to pay off in the long run.

Some tried and true common strategies include:

• Buy and Hold: Buy and hold is a passive strategy where an investor acquires assets and keeps (or holds) them for a long time. The investor does not sell them during periods of extreme loss or fluctuation. This theory is often championed as the best investment strategy, as most established assets will likely appreciate over time, even if experiencing temporary volatility.
• Buy the Dip: Buying the dip refers to purchasing a stock during a drop, or low point, knowing it will likely recover and appreciate. The buy-the-dip strategy is typically accompanied by another tip—selling high.
• Options: A stock option offers investors the opportunity to buy or sell a stock at an agreed-upon price and date, but investors are not required to do so. A put is a contract giving you the right to sell a security at an agreed-upon price before a specific date. Investing in a put option means you’re betting the security price will fall before the expiration date, meaning you can sell it for a higher price than it’s worth.

A call is the opposite and means you’re betting the security will appreciate, allowing you to buy it cheaply. Options are essentially a bet on whether a stock will fall or rise.

Once you feel confident in a strategy, go for it! But remember—only invest what you can afford to lose.

Final Words

Remember that you’re young and fabulous, and not feeling anxious about your finances will make you feel more fabulous in the future.

It doesn’t matter where you’re at with your current financial situation. The important thing is that you’ve read this article. You are learning better investing strategies and thinking about your financial future. Take one step at a time but keep moving forward. We’ve shared a few key concepts here, and there are many more to learn. Keep reading, keep moving forward, and keep investing.

The post How Can the Young and Fabulous Improve their Investing? appeared first on Due.

You’ve probably heard the term federal funds rate mentioned on the news or by a relative interested in the economy, but what does it mean? The federal funds rate is the interest rate banks charge each other for borrowing short-term money. The Federal Reserve sets the rate which affects inflation, economic growth, loan, and savings rates. Let’s dive deeper into how the rate is determined and its economic impact.

Key takeaways

• The federal funds market developed leading up to the Great Depression as the Fed learned to use monetary policy to achieve macroeconomic stabilization goals.
• The Federal Reserve sets a target rate to keep inflation in check and keep banks liquid.
• While the direction of the rate can often be controversial, the Federal Reserve uses various reports to decide what the rate should be.

What is the Federal Funds Rate?

The federal funds rate is the interest rate that depository banks charge other banks for overnight loans of excess cash from reserve balances. For example, a bank with deposit accounts lends its extra money to another bank that needs fast cash to boost its liquidity. The lending bank pulls from its excess cash reserves for a single overnight period and charges interest on that loan.

The Federal Open Market Committee (FOMC) – the committee within the Federal Reserve System that controls the federal funds rate – can’t force banks to charge the federal funds rate. Instead, the banks engaging in the transaction agree to an interest rate for lending and borrowing the money. Still, the rate banks charge each other is influenced by the effective federal funds rate. The reverse is also true — the interest charged between banks affects the federal funds rate.

The Fed can influence interest rates by controlling the country’s money supply. More money means lower interest rates, while less money means higher interest rates. 

Why was the Federal Funds Rate Created?

The stock market crash of 1929 caused a run on banks that quickly stripped them of liquidity, resulting in a mass failure of banks across the country. In turn, their customers lost their life savings. In response, the federal government created a reserve requirement that forced banks to maintain a percentage of their overall deposits on hand in the form of cash. When a bank runs low on physical money, it can reach out to the federal government or any institutional lender for a quick infusion of cash to maintain its reserves. 

Reserve requirements are usually contingent on the number of net transaction accounts a financial institution has. 

Banks aren’t the only financial institution that have to meet reserve requirements. Credit unions and savings and loan associations must also maintain a certain level of cash in their vaults or at the nearest Federal Reserve bank. 

Banks borrow from each other because the interest rates charged by other banks are typically lower than those charged by the government. However, a bank can also borrow from the Federal Reserve during a period known as a discount window. Banks who borrow overnight during the discount window get an interest rate lower than the federal funds rate.  

How Does the Federal Funds Rate Work?

The Federal Reserve is the government institution that loans money to banks and other lending institutions. It sets the interest rate when banks borrow money from the Federal Reserve. The FOMC meets eight times yearly to discuss and ultimately set the federal funds target rate. 

Open market operation (OMO)—the Fed’s policy of selling and purchasing securities on the open market—impacts lending institutions borrowing from the Fed nationwide. The sale or purchase of bonds directly affects banks through an increase or decrease in liquidity. 

The sale of bonds lowers liquidity for banks, reduces the amount they have to trade, and raises the federal funds rate. In contrast, the government can buy back bonds, which lowers the federal funds rate and leaves banks with excess liquidity for trading. 

How the Federal Funds Rate is Used to Control the Economy

You may have noticed that the media reacts strongly whenever the Federal Reserve raises or lowers rates. That’s because the federal funds rate directly impacts the economy in almost all lending areas. 

Raising the Fed Funds Rate

Credit cards that tie their interest rates to the federal reserve rate charge more interest on existing balances and purchases when the fed funds rate increases. Mortgage interest rates rise, too, as do auto loans. The overall effect of a higher fed funds rate is drawing more money out of the economy through debt service, leaving the average consumer with less money to spend. 

On the surface, raising interest rates is seen as a negative because it impacts individuals’ ability to pay for their living expenses. However, when there’s too much money circulating freely in the economy, prices spike, and inflationary pressures make it harder for people to buy the basics of daily life. 

The FOMC will usually raise the federal funds rate when inflation is high because it draws money out of the economy at all levels, resulting in a leveling out of prices and an eventual return to normal for the cost of most products.

A higher fed funds rate translates to a higher interest rate on savings products (such as your bank account, bank certificates, deposit, and bonds). This encourages people to save more since they can earn a higher return.

Lowering the Fed Funds Rate

Conversely, when there’s not enough money circulating in the economy, the FOMC will usually lower the federal reserve rate to reduce the cost of borrowing at the institutional level. Banks are more likely to lend money to consumers because it costs less to borrow from the federal reserve and other lending institutions. A lower rate gets more money circulating in the economy at all levels. 

Analysts and investors often react negatively to an increasing federal funds rate as they see it as a negative for the economy. Its importance is undeniable, though. By raising the fed funds rate, the FOMC can curb rising costs, even if it takes time for the lower prices to reach consumers. 

An economic theory known as asymmetric price transmission (a.k.a. rockets and feathers) refers to the pricing phenomenon of a sudden spike in prices followed by a slow decline. Gasoline prices are one such example. A disruption in the supply chain can cause gas prices to spike quickly, but it can take weeks for the price to go back down. This is because lower input costs don’t immediately translate to lower prices of finished products. 

In the same way, the FOMC hopes an increase in the fed funds rate will translate to banks borrowing less, less money entering the economy, and prices dropping. But that usually won’t happen right away. 

Investors and the Stock Market 

It’s not just the media that react strongly to news regarding the federal funds rate. The stock market tends to jump on announcements of a lower fed funds rate, as it means companies will be able to borrow more cheaply and hopefully enter a period of expansion. 

Similarly, the stock market tends to dip on news of an increased federal funds rate, which signals inflationary pressure and the Fed attempting to curb unsustainable economic growth.  

The Federal Reserve is responsible for preventing another economic crash like the one in 1929. Its decisions aren’t always popular, but they reach their decision using various economic reports and comments from the 12 reserve banks. The resulting consensus moves the federal funds rate up, down, or maintains the status quo. 

The Fed Funds Rate’s Impact on Loan Rates

As a general rule, an increase or decrease in the federal funds rate results in a corresponding increase or decrease in the amount of interest charged by lenders. This is because the federal funds rate directly influences the federal prime rate.  

The prime rate is what banks will charge their most creditworthy customers – generally 3% higher than the federal funds rate. For example, a federal funds rate of 3.25% results in a prime rate of 6.25%. 

Lenders use the prime rate on short- and medium-term loans and lines of credit to consumers, then add extra interest to cover the costs of originating the loan and making a profit. For another example, when the fed funds rate is at 6.25%, a borrower who takes out a $300,000 loan on a home with a 20% down payment can expect to pay 9.25% in interest on a 30-year fixed mortgage. 

The prime rate is influenced by the federal interest rate, which applies to all lending institutions across the U.S. But it is not a law. It’s possible to find lenders offering loans and lines of credit for less than the prime rate. Always read the terms and conditions when getting a loan from a lender offering interest rates less than the prime rate. 

Final Words

The federal funds rate is an integral part of the U.S. financial system. It helps to ensure the banking industry is operating efficiently and helps inflation stabilize when prices threaten to push too high. Investors need to know the current federal funds rate to make better investment decisions with their money in terms of saving and borrowing.

Tracking information from the consumer price index (CPI) and the personal consumption expenditures (PCE) price index ahead of FOMC meetings can help you anticipate what actions the Fed will take to stimulate or curb economic growth. 

The post What is the Federal Funds Rate and How Does it Impact Loan Rates? appeared first on Due.

When you talk about managing your finances, how frequently do you review your expenses? Don’t you worry about grocery bills pinching your wallet or travel expenses rising like never before?

Well, whether you curse inflation, recessions, market downturns, or international events, future-proofing your money is crucial. With inflation rising at an ominous rate over the last 12 months, there’s a thin chance of it dipping below 6% anytime soon.

So, what’s your counter-strategy to prepare your finances for the future? Investments can be intriguing, and financial planning turns out to be a meticulous affair!

Economists are speculating that the current inflation spike is here to stay. How do you plan to allocate your assets and save your money for your future?

In this article, we have come up with a bag of advice to help future-proof your money. Besides, we have recommended some asset classes that would grow your funds to beat inflation.

How to turn saving into a habit?

We all love our salary day. We feel gratified with our lives when our hard-earned income is credited to our bank accounts. However, it’s easier to spend money than earn it. Earning financial freedom seems to be a myth, right?

A study reveals that 15% of Americans didn’t have any kind of retirement savings whatsoever. 5% of the citizens saved less than $25,000. Another 22% had just $5,000 or even less as their retirement savings.

That’s how grim the reality of finances is amidst challenges like inflation and recession. To draw your line of defense against unplanned expenses and combat inflation, try cultivating the habit of saving.

Before we recommend how to diversify your portfolio, here are a few tips that should help you save more!

1. Budget, review, and save

Do you know why most people fail to save money? The temptation to spend and celebrate the joy of earning can be dangerous! In times of plenty, overspending on unnecessary things and extravagant lifestyles can get you carried away.

Saving money starts with handling it wisely. Have you reviewed your major living cost and identified where your monthly income is going?

Well, we aren’t advising you to do away with all your indulgences. However, it’s always good to cultivate saving habits by curtailing unnecessary bills and expenses!

How about eating out twice a week rather than thrice? How about switching to a different insurer to save premiums? Approach your streaming services, utility bills, and gym memberships in the same way.

There are plenty of avenues where you can save without impacting your lifestyle. Most importantly, refrain from making impulse purchases.

By being realistic with your budgeting, you can keep your household expenses within control. Now that you have been saving a bit, why not put it aside in a SIP or recurring deposit?

2. Be debt-free

Do you know what the worst thing about having debts is? You shell out interest that you could be saving. Besides, having a debt-paying mentality dampens your spirit to save!

Having multiple loans at high-interest rates can be a setback for your financial goals. The interest would be eating into your household income and preventing you from saving. Again, long-term debts such as mortgages can unsettle your retirement savings. It’s okay to have a small debt so long as it doesn’t prevent you from planning your future savings. Planning your future savings is a critical way to future-proof your money.

• Consider consolidating your loans at a lower interest rate to curtail unnecessary cash outflow each month.
• Factor in your loan tenure, interest rate, and credit score as you equate your liabilities and savings plans.
• You may also consider balance transfer options to curtail your interest rate.

The sooner you are debt-free, the earlier you can start consolidating your future assets.

3. Automate your savings

You prefer automating our credit card dues or loan repayments, right? This way, you ensure the amount gets transferred to your lender every month.

Why not approach your saving mission in the same way? Automatic transfers to your savings accounts, mutual funds, or recurring deposits can make saving a healthy habit. The amount would get into the respective accounts straight out of your paycheck.

As you prioritize your saving goals, track the amount and proportion of money you channel into each account. Automating your savings will force you to put aside money for your future and future-proof your money.

Does your recruiter provide a plan for retirement savings? If they do, go for it. Without a 401(k) or 403(b) plan, why not open a Roth IRA? It makes sense to invest in these accounts as you channel your funds into index funds having low expense ratios.

4. Save funds for your rainy days

Well, do you have an emergency fund in place? It’s easy to use the term “rainy day fund’ interchangeably, but you shouldn’t. While planning your finances, make sure to allocate funds for both these purposes, given that they serve slightly different objectives.

Suppose you are out of work due to illness or recession for a few months. Your emergency fund would help you sustain yourself and maintain the same lifestyle standard.

However, rainy-day funds aim to manage one-time expenses. For instance, there’s hail damage to your home, or your insurance fell short of compensating for medical bills following an accident. Sooner or later, every household needs to shell out these unexpected costs. From car breakdowns to malfunctioning home appliances, rainy day funds help manage these expenses.

With your rainy-day funds in place, you won’t be digging into your future savings. Neither would you need to stop your SIPs or interrupt them for a month or so. Digging into savings or stopping your SIPs could prevent you from future-proofing your money and finances.

5. Reduce your dependency rate

What proportion of your paychecks are you dependent on? This percentage determines your dependency rate. Try to slash your dependency rate to weather yourself through challenging financial times. So, it’s better to have a 60% dependency rate than a 90% one.

To reduce your dependency rate, be patient and stick to tight budgeting practices. Working your way out of tough financial crunches will prepare you for saving money in the future.

Try to differentiate between your needs and wants. Also, educate your kids to maintain a healthy lifestyle without going extravagant. Ultimately, when each member of a family starts saving, the amount translates to future assets.

Creating a long-term wealth portfolio: How to plan your investments?

Let’s take a look at how you can create a well-balanced investment portfolio that can serve as a hedge against inflation and other economic crisis.

1. Allocate your investments wisely

At a time when inflation looks menacingly threatening, it’s logical to allocate your investments wisely. Financial experts recommend allocating 40% of your investments to fixed-income assets. Channel the remaining 60% to moderate equities to balance your financial portfolio.

Adopting an income-oriented stance, why not shift some of your investment to dividend-yielding stocks? Historical records reveal that stocks have beaten bonds while keeping up with inflation.

2. Purchase irreplaceable items

With prices of goods and services soaring, it pays to invest in irreplaceable items. We are talking about real estate and land. You may even consider collector’s edition baseball cards or similar unique items. In times of inflation, these items perform exceptionally well. Just because they can’t be replicated, they can serve as a hedge against inflation.

3. Go for TIPS

Investing in Treasury Inflation-Protected Securities (TIPS) is advisable when you look forward to developing a well-balanced asset portfolio and future-proof your money.

TIPS refers to government bonds where the growth pattern replicates the increment and dip of inflation. So, you can expect a better interest rate when inflation rises! You won’t repent low returns even when other asset classes perform adversely amidst high inflation in the coming years.

Having TIPS in your finance portfolio negates the adverse impact of inflation on your bond or fixed-income portfolio. TIPS happens to be one of the safest channels of investment since the federal government of the US backs it. Therefore, you can diversify your investment while strategizing channels for your future fund inflows.

Besides, investors can expect interest twice a year from TIPS bonds. At maturity, you would receive more than the adjusted principal.

4. Real estate investment trusts (REITs)

An increasingly higher number of US citizens are counting on REITs to grow their assets. REIT companies own and operate real estate that generates income. When inflation rises, property prices would correspondingly witness a spike. So would rental income, and the chain effect tends to benefit REIT investors. In major REITs in the US, there’s a pool of properties, and investors get dividends from their profits.

However, it pays to know the drawbacks of REITs before investing in them. With the rise in interest rates, treasury securities turn out to be more attractive. This can lower the share prices of REITs as the funds get drawn away from them. Nevertheless, considering the dividends, REITs are an impressive investment avenue.

6. Short and mid-term fixed accounts

In an attempt to weather an upcoming recession, it’s imperative to secure your retirement accounts amidst inflation. So, review your mid- and short-term fixed accounts. These include your fixed annuities with tenures between two to five years.

Considering guaranteed rates, you can’t expect much from CDs and money market accounts. However, a mid or short-term annuity can offer fixed returns of up to 3%.

7. Diversity your equity portfolio with stocks

It takes adequate financial knowledge to craft a well-balanced equity portfolio in the stock market. With a meticulous approach and foresight, stocks can be a hedge against inflation in the long term. However, stocks won’t save you from inflation in the short term. Therefore, put aside adequate funds for short to mid-term investments.

For beginners, we would recommend index funds that follow the market pattern. Financial experts suggest that these funds perform well in the long term.

Simply open a Demat account on a trading platform. A Demat account will have the details of the shares and securities in your name, and your trading account allows you online trading facilities. This will make it easier to participate in the stock market if you wish. Be sure to get along with one of the top brokers, as they offer user-friendly features on their apps. Use their free resources to refine your knowledge.

8. Invest in precious metals

One of the effective tactics to hedge against inflation while securing your assets is to invest in precious metals. Evidence, as well as historical data, reveals this tactical link between metals and inflation.

Gold and silver cannot be printed, unlike paper currencies. This implies that these metals would always present a shortage to investors in terms of availability. Moreover, even when the currency grows weak, precious metals tend to hold their value.

In the past, investors used to vouch for physical gold and silver in the form of jewelry, bullion, and coins. Currently, you have other investment channels for precious metals, including Silver ETFs and Gold ETFs.

Apart from gold’s symbolic value, its modern uses and scarcity make it worthy. Besides, it finds a wide range of industrial applications. The same applies to silver, a crucial element in electronics. No wonder why forward-thinking investors switch to gold and silver to prevent their wealth from melting away amidst high inflation. This way, you can draw your line of defense against currency devaluation.

9. Invest in commodities

With inflation showing its ugly face, it’s logical to invest in commodities. As per research, commodities continue to be one of the asset classes that remain correlated positively with inflation. Besides, commodities are not correlated to the stock market. So, why not think of asset diversification by including commodities in your portfolio?

Commodities refer to agricultural products or raw materials that can be traded. Common commodities include natural gas, pulses, spices, grains, oil, and metals. Given that commodities are essential for maintaining the daily livelihood of consumers, they hold intrinsic value for investors.

During inflation, the prices of essential commodities like pulses, oil, and grains spike. Naturally, strategic commodity investments can future-proof your money and investments.

Investors can purchase commodities indirectly through stocks or futures contracts. If you are unwilling to expose yourself to the futures trading risks, go for exchange-traded funds (ETFs) or commodity mutual funds.

A word of caution for investors, commodities can be more volatile than you think. Since the prices of commodities fluctuate with demand and supply, demographic conflicts can impact the pricing severely.

Endnote

Now that we have discussed effective strategies to counter inflation and other economic crisis, you are well-poised to craft your investment portfolio. Consult a financial expert if you aren’t confident in dividing your assets across all these investment channels (this is usually advised).

We would also advise you to categorize your financial goals into three segments: short-term, mid-term, and long-term goals. Go for long-term wealth creation only after addressing your immediate, short-term, and mid-term financial goals.

With healthy saving habits and responsible money handling, investors can brace up against inflation with confidence. The secret to success in financial management lies in identifying your goals and strategizing investments wisely.

The post How to Future Proof Your Money, Today and Forever? appeared first on Due.

When you get down to basics, financial planning is simply the process of setting financial goals and creating a plan for how you’ll meet those goals. That seems innocuous enough but it can admittedly get a little complex, and sometimes overwhelming. 

Yet short of a winning lottery ticket or an unexpected inheritance, it’s virtually impossible to improve your financial situation without planning. The answer may well be in taking a few key steps to improve your financial planning process. 

Here are 15 ways you can do just that and reach your money goals a lot faster. 

1. Set Financial Goals

No matter where they are in life, people hope to have something ahead to look forward to or plan for, and those events might warrant realigning current financial goals. Some people may even be setting those objectives for the first time. Whether you want to go to college or graduate school, start your own business, raise a family, buy a house, or retire in comfort, your financial situation dictates whether and how you reach those goals. 

Setting appropriate financial goals for yourself can help you reach them by creating a workable plan that you can follow and a way to monitor how close you are to meeting that goal. Moreover, financial goals help you increase and maintain your level of motivation to follow that action plan. 

2. Create a Budget

No matter what kind of budget you’re interested in establishing for yourself, the process can seem a bit complex at first but it doesn’t need to be an overwhelming challenge. At its core, your budget is based on factors you already know: your current and expected income, your fixed bills, your recurring variable bills, and any future one-time expenditures that you can anticipate. 

To simplify the process, break the work into segments and tackle them on different days. And if the thought of budgeting with a pen or pencil and paper makes you a little dizzy, why not explore a digital approach? You can find lots of freely available budgeting tools online. If you’re familiar with Google office suite apps, you can also search online for budgeting spreadsheet templates that might simplify your planning process. 

3. Track Your Spending

Lots of people struggle with controlling spending habits, but there’s no doubt that it’s one of the easiest ways to improve your cash flow and work towards your financial goals. Tracking spending helps you spot the areas in which you can trim expenses and purchases, which means you can then redirect those funds to more productive uses. 

As with budgeting, you can go with an analog or a digital approach. There are lots of expense tracking apps available online, some free and some premium. Or you can pick up a small, inexpensive notepad to carry with you and simply jot down what you spend every day. The true value of tracking your spending lies in the analysis of your habits, so be prepared to spend some time weekly or monthly reviewing your expenditures to spot where you can cut back. 

4. Reduce Debt

Focusing your attention solely on ways to increase income in order to meet your financial goals can be tempting. It seems like the most direct path to achieving those objectives. However, most people find there’s only so far they can ethically and legally increase their income. One area that occasionally gets short shrift in financial planning is reducing debt. 

It might not seem as exciting as creating new streams of passive income, but debt reduction is a powerful way to help make financial planning. By trimming the amount you spend each month to pay off loans and credit cards, you free up important capital to put to more constructive use, such as investments or savings. 

5. Increase Savings

Given the ways in which life can throw some unpleasant surprises our way, it’s not so hard to see why it’s important to create and build up your savings. That’s especially true in stressful economic conditions, such as where a recession may be looming around the corner. 

One of the best ways to begin saving is to look for a bank account with automatic savings tools built in. For example, with some checking accounts you can round up each purchase to the nearest dollar and put the difference in your savings account automatically. You may also be able to direct your bank to divert a certain percentage or dollar amount of each paycheck to your savings. That way, you’ll continue to build your savings without additional effort on your part. 

6. Invest in Your Future

Savings accounts and reducing debt payments are important, but if you want to provide for your retirement, build true generational wealth and achieve other long-term financial goals, you’ll probably need to invest your money in some way. Investments help your assets grow faster and more significantly than they do in a typical savings account. 

However, getting started with investing can be a daunting prospect. To begin educating yourself, use trusted resources to learn about investing in stocks and ways you can safeguard your investments in a challenging economy. 

7. Plan for Retirement

Most of us hope to eventually stop working one day and enjoy our golden years. That means we’ll need to plan for our living expenses and retirement goals, too. 

One of the first steps in financial planning for your retirement years is to address your sources of income. Between Social Security, your job’s 401(k) or your Roth IRA, and other investments, you’ll need to ensure you have enough money to cover living expenses and any travel or other goals you’d like to pursue. It’s also crucial to think about how you plan to manage your debt in retirement. 

8. Protect Your Finances

Another aspect of financial planning that you’ll want to consider is how you’ll protect your investments, your assets, and your income. In most cases, that means insurance. While you’re working, it’s critical that you protect yourself and your family with long-term care and disability insurance policies, to augment whatever coverage you might have from your health insurance policy. 

Insurance is also crucial during your retirement years. You’ll be less able to replace a source of income if something unfortunate occurs, so you’ll want to ensure you’re covered with health insurance and long-term care and disability coverage, along with the usual life, auto, and homeowner’s insurance. 

9. Evaluate Your Insurance

While it’s important to get and maintain insurance coverage, it’s also crucial to periodically review and evaluate your coverage limits and policy terms. That’s because life events can radically alter your financial landscape. Just as you want to ensure you’re carrying enough insurance to address likely risks, you also want to make sure you’re not carrying too much. 

Given the myriad ways in which personal decisions, health issues, and career choices among others can impact your finances, it’s smart to take some time to sit down with an insurance professional every so often and evaluate your current coverage. 

10. Review Your Credit Report

The U.S. government gives its residents the right to one free copy of the reports from each of the three major reporting bureaus (Equifax, TransUnion, and Experian) every year. You don’t need to pay a commercial service for this information. Simply visit AnnualCreditReport.com, or if you prefer call 1-877-322-8228.

Once you acquire your credit reports, review them carefully for any errors. Look for loans or accounts that you paid off that may be listed as unpaid, any accounts marked closed that are actually still open (or vice versa), and delinquencies that are listed in error. Not every creditor will report your account to each agency, so your reports may contain different items, but you do have the right to request corrections for erroneous information. 

11. Improve Your Credit Score

Your credit scores (you have more than one) will play a large part in determining your financial future. Whether you’re approved for a loan, what the terms will be, how much interest you pay, and more can all depend on the strength of your score. 

There are many strategies you can employ to improve your credit score. Start by disputing errors on your credit report. Additionally, pay every bill on time each month. Set up automatic bill pay for recurring debts to make sure you aren’t late. Avoid applying for too many new credit accounts at once, and don’t close out old credit accounts once they’re paid off. These steps will help you improve your score and meet your financial goals. 

12. Refinance Your Loans

The loans that make modern life possible also carry costs that can have a significant impact on both your current cash flow and your financial planning process. Between the interest rate and the other terms associated with your loan, there’s quite a bit of room for adjustment there. 

If your credit rating has improved since you first took out the loan, it may be a good idea to inquire about refinancing the loan. You may be able to get your interest rate reduced, which could lower both monthly payments and the total amount owed. 

Check your loan documentation to see if there’s a prepayment penalty first, then shop around for a new lender. Even if you do owe your current lender a fine for paying the loan off before schedule through a refinancing, it might be offset by what you’d save in the long run. 

13. Negotiate Bills and Expenses

Due to a combination of factors including the COVID-19 pandemic, supply chain disruptions, and more, the price of everything from eggs to your next car is rising. That’s why it’s important to negotiate and trim your bill expenses wherever you can. 

At the grocery store, you can look for cheaper alternatives, including store brands; choose less expensive cuts of meat; eat vegetarian meals more frequently; watch your purchases and serving sizes to cut back on wasted food; and clip coupons where possible. 

For cell phone bills, try calling your carrier and announcing your intention to shop for a better deal unless the carrier can cut your plan’s costs. The same strategy may also work with other providers where you have alternatives, such as newspapers and media website subscription plans. 

14. Use Technology to Manage Finances

In many ways, life is undeniably more complex these days than it used to be. Don’t hesitate to explore ways in which technology can help you manage your finances and achieve your financial goals. 

Direct deposit, automatic bill pay, automatic savings plans, and more can all help you enlist technology to make implementing your financial plan more efficient. You can also use financial tools for budgeting, bookkeeping, tax preparation, refund hunting, and more. Using technology to keep your financial plan going strong and manage your money more efficiently will help you meet those goals faster and with less stress. 

15. Seek Professional Advice

Personal finance is a complex topic, and the rules seem to change frequently. To stay on top of things and make sure your money is working as hard as possible, consider seeking the input of professionals such as financial advisors, tax attorneys, and others who can help you make the best possible money decisions. 

The right professionals are trustworthy, skilled, and experienced advisors who can help protect your money from unwise or risky investments and more. Consider seeking the help of an investment professional who’s registered with FINRA to give your financial plan a tune-up. 

The post 15 Ways to Do Your Financial Planning Better appeared first on Due.

Over the holidays, I gave my parents a gift card to a local Mexican restaurant. I didn’t expect them to use it right away. But, I was floored when they told me that the gift card is somewhere in their home. Good grief.

Hopefully, they’ll find the gift card soon. Why? Because just like any perishable items in your fridge, gift cards also expire.

Why we love gift cards.

Gift cards are always a welcome gift, whether you are giving one or receiving one. Sure. They aren’t the most creative or thought-provoking gift. However, they’re convenient and flexible. Perhaps that’s why 54% of Americans surveyed said gift cards are the most wanted gift during the holidays.

In the era of COVID-19, rising costs, inventory shortages, and shipping delays, however, gift cards have grown in popularity. According to InMarket, the following key findings were found:

• In 2022, 67% of respondents planned to buy a gift card as their top holiday gift. Among other categories, gift cards outpace clothing (56%), toys (41%), and electronics (27%).
• The most popular retail category for gift cards is Big Box (32%), followed by Apparel (27%) and Beauty (23%).
• In 2022, spending on gift cards was expected to continue to exceed pre-pandemic levels, even though it declined from its 2020 peak.

About 65% of gift cards are redeemed within 180 days of purchase. Marketers have the opportunity to engage shoppers at a critical stage of the purchase cycle as a result.

In spite of that, it is not all honky-dory.

It was found that 47% of U.S. adults have at least one unused gift card, voucher, or store credit, according to a CreditCards.com study conducted by YouGov.com. The survey also found that the average amount of unspent gift cards, vouchers, and store credits was $175, up from $116 last year. Overall, U.S. adult populations have unspent cash totaling $21 billion.

Now is the time to use these gift cards, says Ted Rossman, senior industry analyst at CreditCards.com. “With inflation at a 40-year high, everyone is looking for ways to save money,” he says. “Putting your unused gift cards to work is an easy way to unlock some hidden value.”

What is the shelf life of gift cards?

Thanks to the 2009 CARD Act, gift cards last at least five years from the date of issue.

According to the law, retailers cannot deactivate a gift card less than five years old, and fees for inactivity are limited. Basically, that means that if a business tries to claim that a gift card is expired due to its age, you have recourse to contest that claim

All 50 states must comply with this rule. Also, the recipient needs to know the terms and conditions of the gift card. The expiration date is included in these rules. However, some states require that the receiver follow certain specific circumstances.

In some states, gift certificates and gift cards are regulated by law. There are no expiration dates or dormancy fees on gift certificates and gift cards in California (except in certain cases), for example. And you can use the balance for cash if it is under $10.

Fees vary from state to state as well. In some states, for example, any fees must be disclosed on the card packaging. If states allow post-sale fees, they should only be charged once a month after one year of inactivity.

The issuance of post-sale fees for gift cards is governed by state legislation in a few states, however. A fee is charged for maintenance, activation, and transactions during the purchase process. There must also be a statement describing the accompanying fees on the gift card.

If your state has laws covering gift cards and certificates, consult the State Statutes for Gift Cards and Certificates published by the National Conference of State Legislatures. Alternatively, you can speak with a local lawyer about the state’s consumer protection laws.

What’s wrong with gift cards that expire?

For me, expiring gift cards are a losing proposition.

For one, it’s got to be a bummer for the person who purchased the gift card. What if my parents never find that $100 gift card that I gave them? That means it is left unused. To be honest, I could have just taken a Benjamin and lit it on fire. And, because I know they lost the gift card, I’m even more ticked off.

Suppose my parents find the gift card. Then, to their dismay, they discover that it has expired. It’s very likely that this won’t reflect well on the business. As a result, the customer experience won’t improve. It doesn’t motivate them to return to this restaurant — especially since they occasionally patronize it.

Furthermore, even though it’s illegal for cards to expire until five years down the road (at least), their value can start to depreciate before then. As a refresher, the reason is that depending on the state, some businesses can charge fees for inactivity after a certain time period, depending on certain circumstances.

As for businesses, unused gift cards can lead to brokerage.

Furthermore, even though it’s illegal for cards to expire until five years down the road (at least), their value can start to depreciate before then. As a refresher, the reason is that depending on the state, some businesses can charge fees for inactivity after a certain time period, depending on certain circumstances.

As for businesses, unused gift cards can lead to brokerage.

“Breakage is an accounting term that identifies revenue recognized from services that are paid for but not used,” explain Aaron Hurd and Dia Adams in Forbes.

“The most familiar example of breakage is in gift cards. Many retailers sell gift cards because they know that a certain percentage of the gift cards they sell will never be redeemed,” they add. “Some gift cards will get lost, some will get thrown away and some will just get forgotten. In every case, unredeemed gift cards represent additional profit for the issuer.”

The loss of value caused by gift cards, miles, points, certificates and other stores of value expires, is lost, or otherwise goes permanently unused from a travel and personal finance perspective.

These liabilities can also be converted into breakage income after some time — typically between six and 24 months. It’s how much money the company says won’t be redeemed from gift cards. In other words, the company is getting free money.

However, it might make sense for a business not to let gift cards expire. It’s been found that 75% of people who redeem gift cards spend more than they intended.

Gift cards: How to make the most of them

You can avoid confusion over expiration dates and fees by using your gift card right away.

Tips for when you receive a gift card.

• Be sure to put it in a place where you will remember it. Instead of tossing gift cards in your dresser drawer, place them on top of your dresser, where they will be more visible. Alternatively, you can set a reminder on your digital device to remind you of its location.
• This month, plan on using it. To make the most of an experience gift card, such as one for a restaurant, spa, or museum, book your appointment or reservation right away.
• It shouldn’t be left unused for more than a year. There should be a five-year time period (at least) before any repercussions are felt. However, if the store closes its nearest location or goes out of business, that won’t matter much.
• Think strategically. When redeeming gift cards, you can also save money by using them strategically. With a gift card, you are more likely to get a discount or bonus if the store is already running a special promotion.
• Whenever possible, add it to an app. Depending on where you bought the gift card, you can redeem it for a credit to use at your convenience. As a result, you don’t have to worry about losing the physical card or not having it when needed.
• Sell your gift card. Gift cards can be cashed out at the company where they were purchased or via sites like Raise — if your state allows it. Normally, you can cash out a gift card balance under $10, but you may want to inquire with the retailer. Additionally, Target offers instant store credit when you trade unwanted gift cards.

Tips for when you give a gift card.

• Consider the person’s likes and dislikes. Your gift card will likely go unused if you give it to someone who isn’t interested in the store or service or can’t use it. If you’re unsure, choose a retailer with a variety of items, like Walmart or Target.
• Choose something convenient for them. If your recipient lives far from a theme park or museum, a gift card or membership may remain unused. Additionally, don’t give gift cards that would exceed the budget of the recipient. An expensive meal at a high-end restaurant or at Louis Vuitton will not be covered by a $25 gift card.
• Shop local. Supporting small businesses can be as simple as purchasing gift cards from them. Although this may not save you money, it is an excellent way to make sure that your money is going to support local businesses and communities. This is also a great way to boost the revenue and business of a family or individual you know personally.
• Take advantage of sales. When you buy gift cards at a discount, you can save money. Their value remains the same even though you’ll pay less for them.
• E-gift cards may be a good option. Gift cards sent by email or text are ideal for digital natives because they make it easy for them to load the funds directly into their digital wallets.

Frequently Asked Questions About Gift Cards

1. Exactly how do gift cards work?

There is no difference between gift cards and cash. Typically, the buyer loads a specific amount onto the gift card, and then the recipient uses it to make purchases.

Generally, gift cards are associated with specific businesses, such as Starbucks or Amazon. But some credit card companies, like Visa, offer their own debit cards as well.

2. Do gift cards have an expiration date?

All gift cards are expected to expire at least five years after activation according to the Credit Card Act of 2009.

Also, the inactivity should be mentioned and made public after 12 months of non-use. Inactivity fees can only be deducted once a month. Despite the expiration of the card, gift card funds do not expire. A user must be informed about the fees in advance.

3. Is there a gift card that doesn’t expire?

It is possible for gift cards to never expire in some states. A Mastercard or American Express, for example, gift card never expires. There may also be a date by which the physical card needs to be replaced. You can request a new card by calling the number on the back of the card.

4. If I have a PIN on a gift card, can I get cash from it?

As long as gift cards did not have a PIN, they were treated like credit cards at the point of sale. It is possible to use prepaid cards in either fashion since they usually have a PIN.

In 2013, the Federal Reserve mandated that everyone could get a PIN for a general-purpose gift card, which allowed them to select what type of transaction they would like to make. Some consumers, however, thought they could withdraw cash using the PIN on their Visa gift cards through ATMs or merchants. However, they cannot. Using a PIN on a gift card allows you to make debit transactions.

With gift cards, you can’t withdraw money from an ATM or get cashback from a retailer, but Visa reloadable prepaid cards do permit these transactions.

5. Who purchases gift cards?

You can sell gift cards to companies that buy and sell gift cards for cash if you end up with gift cards you won’t use. You may want to consider Gift Card Granny, CardCash, or Raise as some of the more noteworthy options.

The post Is Your Gift Card Expired? Make the Most of Your Gift Cards by Knowing the Law appeared first on Due.

In the past three years, we saw how life could be fleeting and brittle, just like a thread. In the wink of an eye, it may break or shred when we least expect it. Indeed, life is too short to spend on our stressful nine-to-five jobs or risky businesses.

The unprecedented events that have transpired showed nothing was wrong with exploring everything the world has to offer. Leisure travel and experiences are priceless investments in ourselves.

But let’s face it. What will happen when we can’t make a living or find a secure income stream anymore? What will happen to us when we enter our golden years? As repetitive and monotonous as it may sound, we must plan for our future. We already know it for sure. Yet, we don’t know precisely how to achieve our financial investing goals.

With the current macroeconomic conditions, we must have substantial money in our retirement or investment account to ensure a comfortable retirement life down the road. It allows us to be financially secure or independent without a job or a business. Therefore, we will not have to bother our successors when the time comes.

But that is not the sole upside of retirement planning. Investing in a retirement plan or having non-retirement investments has become more vital than ever. If we do it as early as possible, we can earn more. Our retirement accounts, savings accounts, investment accounts, and brokerage accounts can promise higher income, allowing us to retire early. It will also allow us to reap the returns of our retirement and investment strategy while we still have energy.

This article will focus on building and protecting your retirement and non-retirement funds. We will provide tips to increase and diversify your non-retirement investments in your portfolio. Also, we will help you optimize your non-retirement accounts and maximize savings.

Inflation and Retirement in the US

Retirement is almost every employee’s goal. The idea of not dragging yourself out of bed when the alarm goes off is appealing. We will not have to skip breakfasts and queue up while checking our phones to catch the bus or train. Even better, we will not have to work overtime to meet endless deadlines. We will have all the time in the world to do everything we have always wanted. Travel? Reading books all day? Watching our favorite series? Spending more time with families and friends? Put up a business where we will be our own boss? No matter how old we are, we yearn for something we can’t get or do while working.

However, the current macroeconomic indicators are not on our side. Of course, I am optimistic about the improvement in the latter part of 2023. But we must deal with the potential economic slowdown in the first half.

No law prohibits anyone from retiring before they reach the age of 66 or 67. About 50% of employees aged at least 55 have retired from work in the past three years. Also, nearly one in five employees retired before the age of 65. Others aim to retire when they turn 55. but the younger generations wish to retire at 40.

Sadly, the scar of economic crises in 2004-2008 remained evident even after a decade. Many would-be retirees were forced to use their retirement savings accounts to cover household expenses. Likewise, many seniors and retirees had to live in debt. After the crisis, we learned the importance of retirement planning.

The situation has remained bland in the last year while economic forecasts were still bleak. Although unemployment is still a far cry from the labor market scenario in 2009, older adults are still wary. They don’t mind extending their working years to meet their daily expenses or increase their retirement funds. The sharp spike in inflation is one of their motivations.

In a recent study, about half of adult workers are planning to stay out of retirement. In fact, over 30% of workers in their fifties plan to postpone their retirement. Meanwhile, about 20% of workers in their sixties will work longer. With that, the average retirement age in the US is 66 vs. 62 in 2022. Although it’s the same as the legal retirement age, the increase has been noticeable. We must also note that the retirement delay rate has doubled in the last two years.

Moreover, the impact of inflation has already extended to retirement savings. Another recent study shows that 50% of workers paused their retirement savings in 2022. Over 40% stopped putting money into retirement funds like 401 (k). Even more, almost one-third of employees withdrew some of their retirement savings. The cost-of-living hike drove all these. So, it is unsurprising that 72% of the respondents have already reassessed their retirement plans. Among them, 27% reevaluated their financial goals and strategies.

But this year, we may see an improvement as inflation continues to relax. We started 2023 with inflation landing at 6.4%, a 30% drop from the 2022 peak. Indeed, the efforts of policymakers have started to pay off. Meanwhile, the Fed stays conservative as it keeps increasing interest rates. They may peak this year, but increments may slow down while inflation decreases. The impact may materialize in the second half, which can reduce the cost of living in the US. Even better, I don’t think the potential economic slowdown will lead to a deep recession. After all, inflation was more of a demand-pull than a cost-push. As demand softens and supply chain bottlenecks clear up, the market may correct itself and bounce back.

Likewise, retirees are optimistic about the economic conditions in the US. The same study shows that 57% believe the economy will be more robust this year. Also, over 60% expect an improvement in their retirement plans. Recessionary fears are still present, but pessimism is starting to waver. In the long run, macroeconomic indicators may become more stable. Adult workers may have more excess money for retirement funds and non-retirement investments.

Growing Your Funds: The Basics of Retirement vs. Non-Retirement Investments

Many people invest most of their savings and investments in individual retirement accounts. Yes, maximizing their potential in growing your retirement funds is essential. Even so, you may look at other efficient options if you have extra income to invest.

For many, maxing out their annual contribution limits on traditional IRA or Roth IRA is enough. But we must find other investments to increase our wealth. These investments, often called non-retirement investments, do not require a special investment account. You will only have to contribute after-tax dollars to these investments. Also, you can access them whenever you want, wherever you are. That is why it is crucial to seek help from a financial advisor to get the right investment advice and strategy.

Luckily, we have different non-retirement investments to choose from. It may be easier for you if you have a background in the financial market. If not, fret not, for we are here to guide you throughout your investment journey. You can find the things you need to learn in this article. But before that, we must first differentiate retirement and non-retirement investments. We will discuss their basics to help you understand better how they work. Here are the two investment choices for you.

Retirement Investment Accounts

Retirement investment accounts are qualified investments due to their qualification for beneficial tax treatments. We can make either pre-tax or after-tax contributions. Also, investment yields are tax-deferred until you make account withdrawals.

They have annual contribution limits and early withdrawal penalties before you turn 59 ½. The typical qualified accounts are 401(k)s, 403(b)s, and other employer-sponsored retirement plans. Individual retirement accounts (IRAs)s are part of qualified investments. They also have annual contribution limits and preferential tax treatment.

Employer-sponsored retirement plans are popular because most employers match employee contributions to a maximum rate. Even more important is the familiarity of older adults with these plans, so they often invest their funds there. These are easier to manage since their contributions are automatically deducted from their paycheck. As such, convenience becomes inertia in investing.

Non-Retirement Investment Accounts

Non-retirement investments allow you to invest without investing in a tax-advantaged retirement account. You can access this type of investment anytime and anywhere. You can have numerous goals when opening an account. For instance, you can invest to increase your retirement wealth or grow your extra dollars for future use. Put simply, non-retirement investment accounts are investments aside from defined benefit and retirement plans.

This investment type can be anything from the same stocks you hold in your 401(k) to purchasing properties or investing in a private or publicly-traded business. Again, the goal is to increase wealth matching your need for capital. Of course, it comes at a greater risk due to higher reward potential than just saving money for retirement.

Moreover, non-retirement investments are non-qualified accounts, meaning you invest using after-tax dollars. Unlike employer-sponsored retirement plans, one benefit of non-retirement investments is your control over them. You are free to choose whatever investments are available in the market. It also allows you to make your own investment strategy since it doesn’t have rules and limits. You can withdraw or sell it, but yields are subject to capital gains tax.

But before venturing into non-retirement investments, you must ensure financial security. You may start by determining whether you have adequate money in your retirement account. Do you have enough funds in your retirement accounts for your retirement goals? Do you have emergency funds that will last for three to six months? What are your risk tolerance and financial goals? Doing so will help you become more organized and strategic in handling, increasing, and protecting your assets.

You must also consider investment fees, especially when opening a brokerage account. You may go solo, but letting an expert do everything on your behalf will also be helpful. Also, your risk tolerance will dictate the volatility you can tolerate. Meanwhile, your time horizon will reveal your investment preference. It works hand-in-hand with risk tolerance since financial goals in the short run are suitable for less volatile investments like bonds and time deposits.

Things To Do When Investing Your Non-Retirement Funds

A lot of non-retirement investment advice includes complex formulas and strategies. But sometimes, you only need to pause and look at the bigger picture before deciding. Non-qualified or non-retirement investments promise more returns, but risks are higher. These are the essential things to remember to make your investment journey easier and more efficient.

Check retirement investment options

There are various tax-advantaged and taxable accounts for retirement investments. While you can access it in a bank and other financial intermediaries, your employers may be better. Traditional IRAs, 401(k) plans, defined benefit plans, and Roth IRAs are typical options. But know that you can only invest in the available options per account.

Maximize the advantages of retirement funds

Before investing your non-retirement funds, you must max out all your retirement funds. With the volatile economy and recession fears, it is crucial to maximizing the advantages of retirement plans like 401 (k)s. For instance, if you avail of a plan from your company, it will match your contributions at a certain limit. Basically, that’s free money in a secure and risk-free account. Also, Roth IRAs earn tax-free until you withdraw them.

Start early, earn exponentially

The early bird, indeed, catches the worm. If you start saving and investing early, you have more time to study your investment options and grow your funds. You also have better flexibility to market volatility since you are more familiar with the market trend. As such, you can cope with it through prudent portfolio diversification in technology stocks, bonds, and funds. Aside from that, there are better reasons why saving and investing early can be helpful.

• You will have more time to optimize the potential of compounding interest. You have more time to generate and reinvest investment yields in other accounts. For instance, you invest $5,000 with a compounding interest of 5% yearly. If you invest at 25 and retire at 66, the future value will be $36,959. But if you don’t invest until you’re 45, you will only have $13,930.
• You will be more disciplined, making saving and investing a lifetime habit.
• You will have more time to cope and bounce back from investment losses. With that, you can also try other investments, especially those with high risk and reward potential.
• More years to save means more money upon retirement.
• More experience in investing means expertise in various investment types. It will allow you to go solo and avoid brokerage fees.

Assess your assets and liabilities

In the world of investing, you must spend money first before you earn more money. So before you invest, you must assess your financial capacity to do so. You can start by assessing your net worth, the difference between assets and liabilities.

Your assets include cash and cash equivalents, such as cash on hand, cash in banks, and short-term investments. Other assets are in the form of real properties like houses and personal properties like jewelry. Meanwhile, liabilities include car loans, mortgages, student loans, medical expenses, and unpaid household bills.

Once you list all assets and liabilities, subtract the total liabilities from your total assets. The net value will be your net worth. Then, you can add your net worth to your retirement goals. You can check your net worth from time to time to see if it is in line with your goals. A negative net worth means you have excessive liabilities and no room for more risks. From there, you can find ways to improve your finances before starting your investment plan. Remember that liquidity is king, so you must manage your cash well to increase and protect your wealth.

Manage your emotions well

Crests and troughs are constant in the world of investing. One of the first things to learn is to manage your emotions well. Often, investors are carried away by market sentiments. Bearish views are common during market corrections, so beware.

Typically, an investor may become overconfident when investments perform well. He tends to underestimate market risks, leading to a bad investment decision. Meanwhile, an investor becomes anxious when assets are in a downtrend. He may sell investments instantly, even at a discount, leading to investment losses. Corrections are more common in the stock market. So, investors must be keen during a breakout to avoid bull or bear traps.

As such, it is crucial to avoid becoming an emotional investor. Overconfidence and anxiety may lead to wrong investment decisions. You may lose potential gains or even incur investment losses. Aside from that, you must be realistic with your investments. Observe the actual price and financial trend instead of solely relying on market sentiments. Reading expert analyses and reviews may help, but it’s more important for you or your broker to understand the investment. Also, you may rebalance or diversify your portfolio to make it suitable for whatever market condition.

Consider investment fees

More often than not, your concern revolves around returns and taxes. But exorbitant investment fees may erode the value of your investment. Transaction, brokerage, and administration fees are typical deductions from your funds. You must check them as frequently as you can since fees can offset gains. Calculate the expense ratio to know how much your investments are used for administrative and other expenses. You can divide the fund’s operating expenses by the average dollar value of assets under management (AUM).

Doing so can help you make better investment decisions. That way, you can find more affordable but earning investments. You can choose mutual funds with lower fees or brokers with more reasonable fees.

Suppose you invest $5,000 in a mutual fund with a 2% expense ratio and 5% annualized return. If you withdraw it after 20 years, the gross value will be $13,266. But with the expense ratio, leading to fees of $4,236, you will only get $9,030. But in a fund with an expense ratio of 1%, fees will only be $2,311. The net value will be $10,956. That’s a $1,936 difference.

Avail of insurance or annuities

In general, investments are good. But there’s an unspoken rule to follow when managing your assets. Again, liquidity is king, so always prioritize having enough cash reserves. Once you have enough savings and emergency funds, you may set aside a portion of your income for investments. Then, you must ensure your assets are protected. Insurance and annuities can serve as an extra mantle of financial protection. You will not have to sell your investments at a discount or deplete your savings in emergencies. Insurance will come first before your turn to your emergency funds and savings.

Speak to an expert

You may find yourself saying retirement planning or investing is not your thing. That’s inexcusable. Many financial experts are dedicated to helping you plan for your retirement and investment. Also, you can watch video tutorials or read helpful articles for free.

Non-Retirement Investments To Consider

At this point, you already know the basics of non-retirement investing. These are the investment options you can consider.

Brokerage Accounts

Brokerage accounts are probably the most typical option for non-retirement investing. These are non-qualified accounts, so funding is done with after-tax dollars. With a brokerage account, you can choose from various investment types, depending on your risk profile. These include stocks, exchange-traded funds (ETFs), bonds, and target-date funds.

Among these, stocks are the optimal option, given their high risk and reward potential. But these may require more experience since investors and brokers have to watch price trends, company financials, and market changes. You must value the stock using different price metrics when doing fundamental analysis. Doing so will help you determine if the stock price reflects the company’s intrinsic value. Meanwhile, if you prefer technical analysis, you must observe stock price changes to know when to sell or buy.

Today, it is easy to open a brokerage account. You can do it online as online brokerages become more prolific and impose lower fees. But you have to be more careful to avoid a potential scam. Also, you can find brokerages with higher brokerage fees due to their excellent customer service. Always check their fees and match them with their expertise and quality of service.

Property

Buying properties as passive income is a traditional real estate investment method. You can buy and sell properties or buy and lease them out. Yet today, more common investments, such as real estate investment trusts (REITs) and crowd-funded real estate, are available.

However, many analysts are pessimistic about the real estate performance this year. Property sales and prices are cooling down. Despite all these, I disagree with those anticipating a real estate market crash. First, commercial and residential property shortages remain high. The year started with a 4% decrease in property inventories. We can attribute it to builders becoming more cautious since the Great Recession. With the current supply and demand, price changes may remain manageable.

Educational Plan

Educational plans are another non-tax-deductible savings plan account. Funds can be invested with non-taxable earnings. Even better, withdrawals are taxable for education-related expenses, such as tuition fees and books. It will be helpful if you plan to build a family and expect your child to attend college. But remember that non-educational expense-related withdrawals are taxable with a 10% penalty.

Certificate of Deposits

Certificates of deposit (CDs) are like bonds, but banks and credit unions issue them. It is also logical to classify them as time deposits because they have a fixed term and pay periodic interest. They mature after a certain period, often within a year. Since banks often issue them, they are FDIC-insured, which pays interest. Also, like bonds, they have low risks and lower yields, unlike the other investments on the list.

Government Bonds

There are various types of bonds, but those issued by the government yield some interests with manageable risks. Municipal bonds, treasury bonds, and federal bonds are some typical options. Even better, they are more inflation-linked than corporate and mortgage-backed bonds. Note that most bonds do not perform well in a high-inflation environment. Given the nature of government bonds, they still have decent yields amidst inflation. They also have a better hedge against valuation losses. But overall, bonds have low risk and reward potential.

Learn More About Non-Retirement Investing

Having a consistent income stream is crucial for retirement planning. A passive income can help increase and protect your wealth. As such, investing your non-retirement funds can provide more returns in your retirement years. It is more essential today, given the economic volatility. But no matter how promising they can be, you must be careful and familiar with them before venturing. You must have adequate knowledge, capacity, and patience to do so. Thankfully, various types of investments suit your finances and risk preferences. There are also experts to provide all the help you need for sound investment decisions.

The post Things To Remember When Deciding To Invest Your Non-Retirement Funds appeared first on Due.

Homeowners love putting money back into their properties. The only problem is that home improvement projects can take on lives of their own. In no time, you could wind up with lots of bills and only a little of what you actually wanted and needed. That’s why it’s essential to put a little thought behind all those fixer-upper jobs you’ve planned for 2023.

This isn’t to say that you can’t achieve your “dream home” goals. Just remember to keep yourself in check. As Angi research notes, the average homeowner spent $8,484 on sprucing up in 2022. True, most homeowners spread that money across 3-4 projects. Nevertheless, $8,400+ isn’t exactly peanuts. You’ll want to make sure you spend wisely.

To help you on your way to home improvement bliss — not bankruptcy — try the following strategies. They’re designed to ensure that your remodeling doesn’t go beyond your means and become a financial burden.

1. Set and maintain a strict budget.

Newsflash: Budgets work. “Current You” might not like the idea of setting up a budget, but “Future You” will appreciate the wisdom.

To start the process, make sure you set aside all the dollars you need for your other annual bills first. Don’t forget to include both your savings and emergency funds. Anything left over is fair game for bettering your home and making it more livable, likable, and perhaps lounge-able.

Going through all these motions alone or with your spouse, partner, or housemate has several benefits. First, it sets you up to avoid creeping credit card debt. CNBC reporting says most Americans have more than $6,000 on credit cards. Your home improvement shouldn’t add to your debt load.

Secondly, budgeting forces you to make responsible adult choices. Do you get the super-deluxe, ultra-expensive smart refrigerator or the regular model? Your budget will show you which direction makes the most sense. Ultimately, you’ll feel less stressed because you won’t worry that you broke the bank on your home facelift.

2. Engage in DIY whenever possible.

You might not have all the fancy tools and experience as your favorite HGTV stars. No worries. You don’t have to be a genius craftsperson to whip up some DIY magic around your home. As long as you have the time and willingness to learn proper techniques, you can DIY and save a bundle.

This can include big equipment and appliance installations, like DIY ductless mini splits. HVACDirect.com explains that with new technology, homeowners now are able to purchase DIY-rated mini splits that can heat and cool multiple rooms. That makes them a solid alternative for additions, retrofits for older homes, and converting garages or barns into living or work spaces.

With average installation costs ranging from $1,500 – $3,500, you’re saving big by doing it yourself. Plus, you can do it on your timetable without having to wait on a pro to schedule you. DIY models are built for installation without any special tools, HVAC experience, or major remodeling. They only require a small 3-inch hole to be cut in outside walls. Once you have an electrician handle the wiring, these mini splits are a complete DIY project and a major time and money saver.

Of course, mini-splits are far from being the only types of DIY projects on the market. Others can include anything from bathroom remodels to extensive landscaping. Just go slowly. Rushing through a DIY job is a surefire way to make mistakes. Instead, keep a steady pace to ensure a fantastic outcome.

3. Pick projects known to raise homeowners’ equity.

When it comes to deciding which home improvement project to focus on in 2023, keep an eye on building equity. The more equity you have in your home, the better. Who knows when you might want to take out a home equity line of credit? The greater your equity, the greater the credit you can access.

Let’s say you’re trying to choose between upgrading your bathroom or refinishing your oak floors. According to Money.com, the former would net you a 71% home value increase. In contrast, the latter would bring a hefty 147% return on investment. Clearly, the floors would win if you were trying to raise the equity you have in your property.

This doesn’t mean that you can’t splurge on pet projects. You need to be realistic, though, especially if you plan on moving in the next few years. Unless you’re going to be living in your current home for 10+ years, you’ll be selling it at some point. When you put up that “for sale” sign, you want to get top-dollar bids. The easiest way to position yourself to relocate with more dollars is to be selective with your home improvement decisions.

4. Tackle what’s been costing you money (before anything else).

You’ve been envisioning how great it would be to put in a high-tech home entertainment system. While you might enjoy all those toys and cinema-worthy sound, take a step back. Is there anything more pressing that’s eating up your dough every month? If so, that’s what you need to address in 2023 first.

What type of nagging “stuff” deserves your attention before that home gym complete with a Peloton and fitness mirror? The list is practically inexhaustible: Leaking toilets, energy-inefficient windows and doors, etc. Basically, if something forces you to pay more out-of-pocket every month than you should, it should be a priority.

As you’ll see, these to-dos won’t be much fun. Nevertheless, you’ll be glad that you put your must-do over your nice-to-do list. Cheapism suggests a family of four could save around $70 yearly just by changing a single showerhead. Nothing is worse than receiving ridiculously high utility bills. Getting an installer to replace your aging windows might not be exciting, but it’s practical.

You might think that your house is good to go. Before you make that assumption, take a look at it up and down, and inside and outside. Are there places where moisture (and mold) could gather? Is there a drippy faucet in the laundry sink? Is the screen on your patio door tattered and torn? Address these problems immediately. Then, put any of your budgeted money that’s left over into more “impractical” improvements.

5. Choose solutions with tax benefits.

Every homeowner would love to save a little during tax season. Unfortunately, most home improvement projects won’t help you with taxes. However, a few of them will give you at least a little break in the form of a rebate or other benefit.

Case in point: Until 2034, you can take advantage of the Residential Clean Energy Property Credit. This credit offers a 30% credit against a clean energy expenditure. You just need to be a taxpaying homeowner in the United States and make a qualifying purchase. Qualifying clean energy purchases include improvements like the addition of solar panels or geothermal heating systems.

If you’ve been thinking about moving toward tapping into renewables, this could be your year. Study up before you make any moves, and always work with trustworthy manufacturers and installers. What could be better than living a more sustainable lifestyle while also lowering the amount of taxes you owe? It’s a winning combination if you can make it all work.

6. Consider choosing upcycled or recycled materials.

Another way to save mega bucks on home improvements is to pick recycled or upcycled materials. Say you want to redo the flooring in your family room with a hardwood. Many savvy direct-to-consumer startups have begun selling reclaimed wood from old structures such as barns. Reclaimed wood planks help preserve forests and keep usable wood from being discarded. They look amazing and have unique textures, knots, and coloring, too.

You’d be amazed at the places that sell used cupboards, cabinets, and just about anything you need for a redo. Yes, you’ll need to do a little legwork to find what you’re looking for. But that’s part of the adventure. From bookcases to dining room tables, you can give old objects new purposes.

Feel free to get creative. To whet your creativity, check out an Architectural Digest piece from 2022. The article displays repurposed furnishings including a dresser-turned-sink and a simple side table with updated hardware. Remember that you can always sell the items you don’t need to someone who’s also interested in upcycling. You’ll get a few dollars back to save or spend.

7. Put everything on your best credit card.

As the Points Guy would say, a credit card without points has no point. While you shouldn’t set out to max out your credit, use a points-based card for all your home revitalization spending. This includes anything from the littlest paint can to the biggest appliance.

By putting everything on one card, you’ll get a ton of points or other rewards. The result will be that you can do something special later, like take a vacation or splurge on dinner. And you might not have to spend a penny on whatever it is you do.

There’s a secret trick to making this work for you and not against you: Paying off the card right away. Before your statement comes, you should be down to zero on your credit card. Otherwise, you’ll negate all the advantages you’re getting from your credit card strategy.

Whether you have $100 or $10,000 to put toward beautifying your home-sweet-home, start with a plan. Having a roadmap supported by a realistic budget will give you peace of mind — and a more peaceful living space.

The post 7 Ways to Save Money on Home Improvement Projects in 2023 appeared first on Due.

Talking about money to your partner and spouse is never an easy conversation to have, especially if you’re unsure what they think about it, or if you have limited knowledge of how to work with money.

Not all of us share the same philosophy about money, how we earn and spend it, or how we invest it. Unfortunately, the friction surrounding the topic of money and finances can lead to greater relationship issues such as so-called financial infidelity, where people hide their purchases from their partners.

Putting off this conversation can often do more harm than it does good, and research shows that roughly 64% of couples admit to being “financially incompatible” with their partners according to Bread Financial.

Interestingly enough, the same research survey from Bread Financial found that 45% of coupled adults admit to committing some form of financial infidelity in their relationships.

Allowing money troubles to interfere with your relationship and love life can have lasting effects on both you and your partner. It’s not always possible to immediately understand how everyone you meet works with money, and before pulling the cart in front of the horse, it’s always best to get a clear judgment before jumping to any conclusions.

Yet, oftentimes there are financial red flags that start to reveal themselves over time as the relationship progresses. And while you don’t want to feel like you’re telling another person what they can and shouldn’t do with their money, it’s often better to recognize these issues and share an open dialogue with your partner before it transforms into bigger problems.

Financial Red Flags

Here is a brief look at some of the financial red flags that might be hurting your relationship without you knowing it.

Your partner has ongoing financial troubles

Let’s face it, we all have financial troubles, and often these are carried with us for extended periods, only to be resolved when we seek advice or guidance.

Although money troubles can look different for everyone, from large amounts of debt to low credit scores, or even overspending, having money troubles are financial problems that can be resolved with the right help or talking to someone who has more knowledge on the subject matter.

On average, around two-thirds of all Americans use credit cards, with the average person having at least three credit cards according to CreditNinja.

Jumping from one financial pitfall to the next, without learning from past mistakes can no longer be seen as a coincidence, but rather an active decision to ignore what other people are saying, or find ways to address the issues.

Unfortunately, having money problems, and not being willing to do something to address these issues, or improve the situation can be an issue that can hurt you and your partner, and potentially others that may be involved.

A lack of financial prosperity

There’s no denying that not all of us are on the same life stage in our careers and financial prosperity. Often you’ll meet someone who recently started a new career, or who just got back into the job market after being laid off. Perhaps your spouse decides to go back to school and relies heavily on your income to sustain the household.

At some other time, there will be a point where you or your partner will reach a point where you can create healthy financial habits such as saving for a specific goal, putting some cash aside for retirement, or looking to travel or even start a business.

If you notice your partner is at a point in their life and career where they can save and invest their earnings, but lack the financial capability, consider talking about how they can save some of their money for retirement, or even put it into a savings account.

Be considerate of where they may be in their life, and seek guidance yourself, so that once you have the conversation, you are informed and can deliver actionable practices you both can use.

They tend to be irresponsible with money

Overspending isn’t hard these days, and a lot of the time we see ourselves spending more money than what we budgeted for. There are a lot of instances where we might have purchased something on the whim, without giving it much thought, or have used some of our savings to pay for other expenses – these do tend to happen to the majority of us.

Yet, there comes a point when you will need to address irresponsible spending with your partner, especially if it starts to have an impact on you or the household.

Ask yourself, does your partner spend their income on luxuries before paying for more important things such as rent, groceries, or utilities? Do they purchase items without thinking about the short-term financial repercussions they can have? Are they prone to run out of money early or during the month? Do they take out loans from you, and forget to pay you back?

Perhaps you notice them hiding their purchases from you after you’ve confronted them, or lack the ability to tell you about the purchases they have made.

These and other valuable questions will be a key indicator of how your partner works with their money, and whether they are simply being irresponsible and ignoring their financial responsibilities for their own greater good.

Ignoring their financial responsibilities

A lot of us have a financial responsibility of some kind, whether it’s paying off student loan debt, or even making monthly car installment payments. Every month we budget according to our financial needs, and ensure that our cash can last us until we receive our next paycheck.

In some instances, people tend to neglect their financial responsibilities, often relying on their significant others or partners to pay for their mistakes, or help them pay for things such as rent, utilities, and other important expenses.

Setting up a budget for your partner, or even for your household can help you see where your money is going and what it’s being spent on. If your partner deliberately ignores these efforts, and rather uses their money on less important purchases, it shows that they are unwilling to financially commit or improve on their actions.

Bringing up irresponsible financial behavior with your partner or spouse is never easy, and it can be an uncomfortable situation at first, but for the long-term well-being of your relationship, it’s important to voice your concerns and share guidance where possible.

Your partner is drowning in debt

Although we all wish to be debt free, a lot of partnered couples, even those that are married carry some form of debt. Research shows that 7 out of 10 Americans get married with some amount of debt, whether it’s a credit card or student loan debt.

Balancing your debt is not an easy task, and it requires you to be delicate with your income and spending habits. Making sure you don’t miss payments, and that you’re able to pay off your debt is a financial priority for many of us.

Yes, some of us may have more debt than others, and often we see our partners carrying debt into a relationship, but ignoring the importance of paying it off in time. Being in a debt-riddled relationship or marriage is more common than we may think, and some individuals may disregard their debt responsibilities, hoping their partners will help them repay it.

Understanding how your partner has accumulated their debt over time, and what they are doing to repay it will give you a clear indication of their financial responsibilities, and money know-how. Unfortunately, this isn’t always the case, and often many people will hide their debt from their partners, or take out more debt due to irresponsible spending or money habits.

Ignores the importance of talking about money

Another red flag to look out for is whether your partner deliberately ignores having a conversation about money.

Often they might feel intimidated, even scared or unwilling to share money matters because they might be afraid of the outcomes, but if they’re not open to working through their financial troubles, you might find yourself having to deal with bigger issues down the line.

The “money talk” is never easy, and it can be an uncomfortable confrontation to have with your partner or spouse. If you’re unsure where they stand with money, then it’s best to ask or question them about it when you feel the time is right to do so.

If you notice they’re putting off the idea of setting up a budget for your household, or if you’re in a marriage where one person is unwilling to make financial compromises, you might want to address these issues sooner than later.

Not everyone might be open to discussing their money values, or even their income, so be patient with your partner and see how you can make the conversation less uncomfortable or awkward for them.

It’s best to think about how short-term solutions can help your relationship in the long term, but also ensure you help you build a financial future with someone else.

Parting thoughts

Being with someone committed to someone who is irresponsible with their money, or lacking the willingness to improve their financial situation can have a detrimental effect on your relationship, and your well-being.

Addressing money matters in a relationship isn’t easy, but the sooner you’re able to get on the same page about how you can make your money work for both of you, the more likely you are to share the same values and philosophy regarding your household finances.

When confronting your partner or spouse about their finances, ensure that they feel comfortable enough to share their opinions, and ask where you can assist them, if they require guidance. Instead of ignoring these issues, see how you can work together to overcome financial hardships and build a prosperous relationship.

The post Financial Red Flags That Might Be Hurting Your Relationship appeared first on Due.

The real estate market is in an interesting state right now. Home sales are slowing because of higher interest rates, but prices in some areas have yet to drop. Overall, the median existing home sales price in January 2023 was up 1.3% from the same time last year, but home prices in expensive areas have gone down, while prices in less expensive areas have gone up.

Considering that home prices were reaching record highs in 2021, one would expect them to have normalized with the slowing market, but that has yet to happen. However, if interest rates continue to rise, prices should continue to drop.

But what does that mean to you and your finances? This article will explore how the current real estate market can impact you financially.

Real Estate Situations that Can Affect Your Finances

There are several situations that you may find yourself in where the real estate market may affect your finances.

1. Buying a Home

If you’re in the market to buy a home, you’re going to pay a higher interest rate than you would have in 2021. However, the inventory of homes is high and the number of buyers is down. That means that you may have more negotiating power with sellers. Prices may be higher, but chances are, most sellers are very motivated which could put you in the driver’s seat.

But you’ll end up paying a higher rate, but with a lower price point for the home, so it may even out for you financially. You can also refinance later if interest rates go down and get ahead of the game.

Be sure to do your research into what is happening in your area in terms of prices and the number of sales that are occurring. Every local market is different. Make sure that your real estate agent talks to you about current comparable sales, and use your negotiating power.

2. Selling a Home

If you’re planning to sell your home in the near future, you may be under a bit of pressure. Buyers are fewer in many areas due to the higher interest rates, so the people that are buying have the negotiating power. If you can, you may be better off waiting to sell until rates go back down. However, what will happen with interest rates and when is a great unknown.

If you need to sell and you want to get a specific profit on what you paid for the home or on what you owe on your mortgage, you can calculate here what price you need to stick to.

Often the best strategy in this kind of market is to price your home higher than what you actually need. That way the buyer can negotiate and feel like they’re getting a deal. It cannot be stressed enough, however, that the best strategy depends on your local market.

Do your homework and talk to your real estate agent about what is happening in your market and what comparable homes are selling for. And if you need to make a certain profit on your home, you can stick to your guns and wait for that buyer that “must have” your home.

Work with your agent to make your home as appealing to buyers as possible by making repairs or upgrades and staging the home well. In a tough market, you need to make your home stand out from the competition.

Also, work with your tax advisor when considering the price that you need to get. Selling at lower price means less in capital gains tax, so that will have an impact on your finances overall.

Special note: there was $400mm in sales in January 2023.

3. Investing in Real Estate

Investing in real estate right now is an interesting proposition. Warren Buffet said “be greedy when others are fearful”. Real estate investors right now are fearful of economic and market instability; however, having that kind of outlook depends on your goals and your risk tolerance.

If you’re looking to flip houses as an investment, it’s likely that you can find deals, particularly on distressed properties. But with the number of home buyers decreasing, you may find yourself having trouble finding a buyer and thus incur carrying costs. You can still make a profit, though, if you can put minimal money into the property and price it competitively based on local real estate conditions.

Your best bet if you want to flip homes now, is to carefully analyze each potential deal, including what is happening in the specific area the property is in, and cherry pick only the deals that make the most sense and have the least risk. With so many “fearful” investors, you’ll have less competition, so you can afford to be choosy.

If you’re considering buying rental properties, it’s still a matter of looking at each deal. The higher interest rates mean that fewer buyers are buying and are renting instead, which can drive rents up. That’s great if you can find a great deal and pay cash for the property. If you need to finance the property, however, you’ll be paying a higher interest rate which will reduce your cash flow.

The bottom line is, if you’re considering investing, you have to really understand your local market. Do considerable research before making a decision.

5. Refinancing Your Mortgage

Clearly, if your current interest rate is lower than current mortgage rates, refinancing your mortgage may not be a good idea, and vice versa. You also have to consider your closing costs when deciding if refinancing is financially beneficial.

If you are refinancing to a lower rate and getting cash out from your equity, you may find that when the bank assesses your home’s market value, it may be lower than you think. Again, it depends on what’s happening to prices in your local market.

If you want to refinance to a shorter loan term, you may still be able to benefit. Rates on 10 or 15 year mortgages are generally lower than 30 year mortgages, but your payment may still be higher because of the shorter term.

Another thing to consider is that lenders tend to be more conservative in a slow real estate market, so it may be more difficult to qualify for the refinance. Credit score and income requirements will be tighter, so be prepared to go through a more rigorous application process.

Your best bet is to shop around for the best rates and terms, analyze your options, and decide which option, if any, is right for you.

Here is a nifty refinance mortgage calculator to help you.

6. Home Equity Loans

If you’re considering getting a home equity loan, whether the real estate market will impact you depends on your goals.

If you want a home equity loan to consolidate other debt, current mortgage rates are still likely lower than the rates on other debt such as credit cards. However, similar to a cash-out refinance, your equity may not be as high as you expect based on market values.

If you want a home equity loan to remodel your home, if you’re doing it just because you want your house to be nice and you can afford the payments, go for it. You might want to consider a home equity line of credit with a variable rate so that the rate goes down when rates go down in general. However, rates may also go up.

If you want a home equity loan for remodeling, but with the goal of selling your home for a higher price in the near future, you’ll need to give it careful consideration. If rates continue to rise and home prices fall, you may not get your money back from the remodeling you do and the interest you pay on the loan. Be sure not to overdo your improvements.

7. Renting

Fewer people buying homes means more people renting, which is creating a rental shortage due to high demand. As a result, in 2023 many predict that rental price growth is likely to remain high, which is bad news for renters.

Other economic factors are also decreasing the amount of income that renters can spend on rent. What this means is that rentals in higher-priced areas will be less in demand, which should start to force prices on those rentals down a bit.

In the longer term, rental prices are likely to start to come back down, so if you’re finding it difficult to afford current rents, you may only be struggling temporarily.

As with all the other effects of the real estate market, how the current conditions will affect renters is location dependent. If you’re in the market for a new rental, do your homework and shop around, and don’t be afraid to negotiate with landlords to try to get a better rate.

In Closing

The real estate market is interesting right now, and it’s difficult even for experts to predict exactly what will happen in 2023 and beyond. Many factors will have an impact on the market’s direction, so you should stay informed about what’s happening in the market, particularly in your area.

If you’re in any of the situations discussed, be sure to do your market research and look to professionals, whether it be a real estate agent or a financial advisor, for advice. By doing so, you can find ways to successfully navigate this unpredictable market and protect your finances.

The post How the Current Real Estate Market Can Affect Your Finances appeared first on Due.

For over 1,000 years, the Irish have celebrated St. Patrick’s Day in honor of Ireland’s patron saint. Historically, Saint Patrick used the Shamrock to explain the Holy Trinity to the pagan Irish, and since then the Shamrock has been popularly associated with this holiday.

The date chosen for the commemoration is 17th March in honor of Saint Patrick, who passed away on that date. For Christians, St. Patrick’s Day celebrates the arrival of Christianity in Ireland, which was officially made a feast day in the early seventeenth century.

However, today, St Patrick’s Day is celebrated as a celebration of Irish culture and being Irish, as parties are held all day long. During the course of the day, people come and go from parties starting at breakfast. In addition, stews, bread, desserts, alcoholic beverages, and music are all generally free-flowing throughout the entire day.

As St. Patrick’s Day approaches, let’s bring a bit of Ireland to our homes or workplaces. Even better? You can throw a St. Patrick’s Day without shattering your budget.

1. Invite guests on the cheap.

Organizing a St. Patrick’s Day party requires making a guest list of those you wish to invite. Keep in mind that St. Patrick’s Day is a festive occasion that often involves drinking, so decide whether you would like to invite kids to the party or not. Also, this will help you determine what type of food, decorations, and activities.

After you have compiled your guest list, create your own invitation cards. Or, if your gathering is small, you can send out a quick text or create a Facebook group. If you want to make it a little more formal, send an e-invitation using Evite or Minted for free.

Your invitations should include all the necessary information, such as the date, time, location, and parking information. In addition, let your guests know whether there is a particular dress code or color code (keep it green). As a point of advice, I would recommend sending the invitation no later than three to four weeks prior to the event.

2. Create your own pot of gold.

I think this would be a good activity to do with a small group of kids. After whipping up a batch of microwave-salted caramel sauce, let each child decorate his or her own pot of gold.

Just make sure that you have the following supplies ready:

• A mini glass jar with a lid
• A rainbow you can print out
• Caramel
• For dipping, pretzels

3. Prepare a traditional Irish meal.

Irish food offers comfort and familiarity with a sense of humbleness that makes many dishes both appealing and irresistible. For example, Irish stew.

An Irish stew is a comforting one-pot meal that cooks slowly until the meat is very tender. With only a few key ingredients, this Irish dish is known for its simplicity. Although Americans commonly make this stew with beef, lamb is the meat of choice in Ireland. In addition to potatoes and onions, the dish may also include carrots.

Some other dishes that you and your guests can prepare are:

For a virtual option, online cooking classes and cook-offs provide a great opportunity for friends and coworkers to share a meal and an activity together. Make a meal together by meeting up on Zoom, FaceTime, or another similar software.

If you really want to stick to your budget, make use of use coupons for your ingredients.

4. Make a shamrock body scrub.

Would you like to do something fun for adults on St. Patrick’s Day? This fun DIY is perfect for a ladies night in with wine and green desserts. Or, this could be a fun activity for teachers to do with their students. However, the best part is that homemade sugar scrubs are easy to make and inexpensive.

According to Toni from Design Dazzle, here’s what you’ll need:

• 1/2 cup coconut oil
• 1/2 cup melt-and-pour soap
• 1 cup sugar
• 5-7 drops of lemon essential oils
• gel food coloring: kelly green, leaf green, yellow
• shamrock silicone mold
• microwaveable bowl
• spoon

5. Attend a parade (safely).

Parades are held in most cities on St. Patrick’s Day. Make your party feel like a pregame, then head out to the street for the real celebration.

According to Explore, here are the biggest St. Patrick’s Day celebrations in the U.S.:

• New York, NY
• Chicago, IL
• Boston, MA
• Savannah, Ga
• Kansas City, MO
• Philadelphia, PA
• New Haven, CT
• Pittsburgh, PA
• Denver, CO
• Cleveland, OH
• New London, WI
• O’Neill, NE
• Hot Springs, AR
• Detroit, MI
• San Francisco, CA

There are many virtual St. Patrick’s Day parades you can watch online if you cannot attend in person. So, invite people over and watch the parade from the comfort of your home. Or, you can get a crew together virtually and do the same.

6. Design your own outfit.

Make a list of the green items in your closet. You can then create a St. Patrick’s Day outfit with what you already have to minimize costs. Wearing an entirely green outfit, however, is not a requirement for St. Patrick’s Day. You can add green accents to your everyday look with accessories such as a scarf, tie, socks, or jewelry.

In contrast, if you want a totally festive outfit for St. Patrick’s Day, get crafty and make your own clothes. At craft stores, you can buy t-shirts for a few dollars. Get inspired and purchase some fabric paint to create a green outfit for St. Patrick’s Day.

Here are some clever, fun, and easy DIY tutorials that will give you some great ideas and instructions. And, within a few hours, you’ll have your own custom-made St. Patrick’s Day outfit.

7. Organize a scavenger hunt.

You can get everyone involved and move with a themed scavenger hunt. Furthermore, it helps guests get to know one another and encourages teamwork. Don’t forget to have some prizes ready for the winners.

What’s more, this is another activity you can do virtually. If you want to host an online scavenger hunt, ask participants one by one to collect objects. Players or teams win points when they show the item onscreen first.

8. Play a festive slap-the-bag game.

Head to your local grocery store and buy a box of Lucky Charms. Then, after eating this box of Lucky Charms, cut a hole in the bottom. It should be just big enough to fit the Franzia spout through.

Put the bag inside the box and insert the spout. That’s all there is to it. Now you have to slap the bag — St. Patrick’s day edition.

9. Make your own decorations.

The Internet is full of tutorials on how to craft decorations to add some Irish style to your home. To add a little extra cheer to your home, you can print out a number of St. Patrick’s Day printables.

Here are some of my favorite suggestions:

• Shamrock balloons. Did you know that you can make a shamrock balloon with four green heart-shaped balloons? Decorate the treat table and photo wall with these balloons. It is the Irish tradition to find a four-leaf clover on your way to good luck, so don’t feel that you need to use fewer balloons; “less is more’ is not applicable.
• Party table. It’s not a party unless there’s a table for treats. With a green table runner, place your decadent treats on your table. Using streamers, create a rainbow with a pot of gold at the end above the table. For your guests to dive right in, the table should have sweet treats, rainbow cups, napkins, and plates.
• Shamrock streamers. Start cutting some green streamers, dark and light. However, this task requires extreme precision. It may be easier to buy St. Patrick’s Day-themed streamers rather than making your own if precision isn’t your strongest suit. You could even invite some friends over and have a competition! Make the best shamrock streamers for the party and you win.
• Irish flag mason jars. Making Irish flag mason jars would be a great addition to your St. Patrick’s Day decorations. The first step is to apply primer to them. Starting from the top, paint the Irish flag in the colors green, white, and orange — green at the top, white in the middle, and orange at the bottom.

10. Make St. Patrick’s Day slime.

Make a St. Patrick’s Day version of a wildly popular kids’ craft. You can have hours of fun with just a few craft supplies, such as:

• 1 (5-oz.) bottle of clear glue
• 1/4 c. water
• Green food coloring, (optional)
• Gold glitter
• 1 tsp. baking soda
• 1 tbsp. contact solution (with borate)

11. Play a festive game.

Games and activities are great ways to break the ice and get people mingling. Consider setting up a little pot-of-gold game for the kids.

The goal of this game is to hide gold-wrapped candies around your house for a mini-treasure hunt. Ask the kids to find them. You can have the kids fill little black pots if you want to keep the theme.

Here are a couple more games you may want to play on St. Patrick’s Day:

• Pin the hat on the Leprechaun. There is no need to worry about the audience for this game since it caters to all ages. For the game, guests need to wear face-covering materials (e.g., eye masks) and a leprechaun hat printed out. A full-size leprechaun should be printed and taped to the wall before the party.
• Coin toss. A coin toss is a fun way to test your guests’ throwing skills. Simply put out a pot and ask your guests to stand at least 10 feet away. Provide them with a handful of gold coins, and let the game begin. Those who collect the most coins win.
• Shamrock bingo. This activity is guaranteed to be enjoyed by guests of all ages. Participants are encouraged to participate and it brings everyone together. Best of all? You’re all set to play St. Patrick’s Day Bingo once you print out the cards.

12. It should be BYOB-friendly.

If you’re the host, don’t feel obligated to provide every beverage imaginable. The costs of stocking up on liquor, beer, wine, and more can quickly add up, so don’t go overboard. You might want to consider creating a signature cocktail for your guests-one that is delicious and on a theme.

Generally, batch cocktails are easy to make and allow people to serve themselves, so you don’t have to refill everyone’s glass all evening. An Irish mule or green apple sangria are two fun ideas.

As part of your event invitation, let your guests know that they’re welcome to bring a beverage of their choice to share and drink. To keep any drinks guests bring chilled, make sure you have plenty of ice and a cooler on hand.

Make sure there is a non-alcoholic option for kids and adults who don’t want to drink alcohol. You can’t go wrong with lemonade, water, or seltzer with lime.

13. Host a movie marathon.

For a more subtle celebration, try hosting a shamrock-themed streaming party. Here are some recommendations for movies and TV shows:

• Into the West (1992)
• The Luck of the Irish (2001)
• The Banshees of Inisherin (2022)
• Brooklyn (2015)
• P. S. I Love You (2007)
• Michael Collins (1996)
• Leap Year (2010)
• Wild Mountain Thyme (2020)
• Once (2007)
• The Secret of Roan Inish (1994)
• Angela’s Ashes (1999)

This is yet another party that can be done virtually. Meet on a video call, pick a festive movie or show, and synchronize the video with Watch2Gether.

14. Make an Irish playlist.

Your party will be the talk of the town if you have a well-curated music playlist. For St. Patrick’s Day, you might enjoy these Irish bands:

• U2
• Westlife
• The Pogues
• Thin Lizzy
• Horslips
• Van Morrison
• The Cranberries
• Damien Rice
• The Boomtown Rats
• The Dubliners
• Clannad
• The Chieftains
• Glen Hansard
• The Corrs

15. Take an Irish step dancing class.

Take part in what might be the most difficult, yet beautiful form of dancing. It’s also a great cardio workout. And, you can learn the basics for free on sites like Howcast or Youtube.

This is another virtual party you could throw by either booking a virtual dance class or following a video tutorial.

FAQs About St. Patrick’s Day

Who was St. Patrick?

As the Apostle of Ireland, St. Patrick is considered a Christian missionary. A patron saint is selected to protect the interests of a country, place, group, trade or profession, or activity, and to intercede on their behalf.

In Ireland, St. Patrick is credited with converting the people to Christianity.

It’s interesting to note that he was in Britain in 385 AD. In spite of this, he was brought to Ireland as a slave at the age of 16. Six years later, he escaped and became a priest. In response to a vision, he returned to Ireland to Christianize the Irish.

He is credited with driving out the snakes from Ireland. Most biologists, however, maintain that Ireland never had snakes. The death of St. Patrick occurs on March 17, 461 AD.

When was the first St. Patrick’s day celebration?

In what is now St. Augustine, Florida, a parade honoring St. Patrick, the patron saint of Ireland, is held for the first time.

According to records, Ricardo Artur, the Spanish colony’s Irish vicar, led a parade in honor of St. Patrick’s Day on March 17, 1601. It was more than a century later when homesick Irish soldiers who served in the English military marched in Boston in 1737 and in New York City in 1762.

How is St. Patrick’s Day celebrated in Ireland?

In both Ireland and Northern Ireland, March 17 is a bank holiday. Schools and some businesses are closed as well. In general, restaurants and bars remain open regardless of their hours. Tourist-oriented businesses (pubs, for instance) may actually extend their hours to accommodate tourists in major Irish cities.

St. Patrick’s Day falls during Lent, a time of prayer, fasting, and repentance for Catholics. Irish families used to dance, drink, and feast during the holiday, but American Irish-born settlers started holding massive parties. In recent years, Ireland has adopted the American attitude toward its national holiday, and Dublin celebrates it with a four-day festival that is reminiscent of American celebrations.

What’s the association with the color green?

Ireland’s national color is undoubtedly green, but it hasn’t always been. In Saint Patrick’s day, the country’s flag was blue. The Great Irish Rebellion of 1641, in which commander Owen Roe O’Neill led his men against the English while flying a green flag with a harp, changed that. The Irish flag was brought to the U.S. by immigrants hundreds of years later, and wearing green gradually became a symbol of pride for the Irish.

In Ireland during St. Patrick’s Day, you’ll see plenty of green, as well as shamrocks, a symbol of Patrick’s religious devotion and national pride. Unless a bar caters to American tourists, you won’t find green drinks there. In fact, as a result of the religious nature of March 17, bars were prohibited from opening their doors prior to the 1960s.

The post 15 Cheap St. Patrick’s Day Party Ideas on a Budget appeared first on Due.

For many people, retirement is a time for exploration and adventure, and a well-earned opportunity to finally travel to those longed-for and dreamed-about locations. Yet choosing a retirement travel destination can be a complex process. You’ll want to consider several different factors, including budget needs, health limitations, weather concerns, and more. It’s easy to feel a bit overwhelmed. Here’s how to choose the right destination for your retirement travel, avoid travel mistakes, and ensure a fun, relaxing, and inspiring trip.

1. Create a retirement travel wish list

Do you have a bucket list for retirement travel? If you don’t have one, or if you’ve only thought about this casually, now is the perfect time to put your thoughts on paper. Start by thinking back to travel documentaries you watched or books you read about someone else’s dream vacation. If you ever thought to yourself, “Someday, I’ll go there!” write that destination down.

Don’t worry just yet about whether you can afford that particular trip or if you can physically manage to visit a certain attraction. Right now, you’re simply writing down a wish list. You can later pare down your list based on practicalities. Even if you do have to pass on a specific destination, however, you can always use that location to come up with similar trips that might be easier to arrange.

2. Seek recommendations

Now that you’ve started your dream trip destination list — round it out a bit (and maybe even pare it down!) by asking friends and family members for their recommendations. This can be a great conversational icebreaker at family get-togethers or dinner parties. Simply ask people to tell you about the best trip they ever took and what made it so enjoyable. You might also want to follow up by asking what the worst travel experience they ever had was and why.

Another idea is to join a travel group for retired individuals. This can help you get a sense of what destinations other retired travelers have enjoyed and may give you some new ideas to consider. You might even decide to join a group on a future trip, which could also save you additional money, time, and energy.

3. Determine your budget

As a retired traveler, you may have a fixed budget to work with. Consider how much you can afford to spend on travel costs such as flights, accommodation, and activities. The financial aspects of retirement travel can be a bit daunting, if not overwhelming. You’re likely working with a fixed income, and unless you’ve specifically saved up additional amounts for retirement travel, you’ll want to look for ways to save money wherever possible.

Moreover, retirement travel costs can really add up. From additional fees associated with flights to the local cost of food and drink, hidden costs can present an unpleasant surprise. To counter those surprises, budget an extra amount to have available as a buffer to cover unforeseen expenses.

Other ways to save on retirement travel include:

• Look for destinations a few hours outside a major destination. You can save on hotels and food while still getting to see the sights during a day trip.
• Use points or other credit card travel rewards to help finance the trip.
• If you’re traveling by train, check out overnight trips. These fares are usually less expensive as they’re not as popular.
• Pack as little as possible to save on extra checked-baggage fees.
• Book your travel as far in advance as possible. This may help you save quite a bit on both airfare and on accommodations.
• Explore ways to save on food, such as booking rooms with kitchenettes or Airbnb stays where you can prepare your own food. And definitely pack your own snacks.
• Spend a little time looking into various discount opportunities from travel sites, attractions, and memberships such as AARP.

Planning a retirement travel budget can be a daunting task. With some careful planning and a bit of research, you’ll be able to set a budget that you can stick to during your trip.

4. Consider your travel style

What’s your pleasure when you’re traveling? Do you prefer relaxation or adventure? Cultural experiences or beach vacations? Thinking about your preferred travel style will help narrow down your destination options.

Some retirement travel style choices are fairly simple. For example, if you need lots of quiet time to properly unwind, it wouldn’t make a great deal of sense for you to schedule a beach trip during the spring break season. If you crave cultural experiences, such as opera, ballet, or theatrical productions, you’re not likely to find much to do in a tiny mountain village.

Other considerations might require a closer look and a bit of research:

• Accommodations: Depending on your chosen location, you can choose from various accommodation types. Whether you’re looking for a luxury full-service hotel, a “glamping” campsite, or something in between, getting clear on your desired accommodations may help you lock down the right destination.
• Dining and food preparation: Fabulous restaurants, hotel room service, and lodgings with access to kitchen space can all play a part in keeping you fed during your trip. Think about the dining experiences you want to have and jot those down.
• Proximity to airports and other transportation: Are you longing to experience a long, scenic train voyage? Do you want to avoid driving at all and thus need a destination with an airport and access to ride-sharing or taxi service? If you’re prone to motion sickness, you’ll want to avoid destinations that can only be reached by boat.
• Day trips and sights of interest: What kind of activities do you want to pursue during your trip? You might prefer visits to historical attractions and museums, amusement parks, shopping, or beaches. Or perhaps you crave sitting by the hotel pool with the latest bestseller. Whatever it is you want to do, see, and experience, make a note of it now.

5. Research destinations

Now that you have a better idea of your travel style preferences and budget, it’s time to start narrowing down your list and researching possible destinations. You’ll also want to consider the cost of living, safety, accessibility, and other factors.

You might want to start by creating a simple chart or spreadsheet that lists out the factors that are important to you. For example, budget, physical accessibility, access to specific features such as beaches, etc. Score each possible destination choice on a scale of one to ten. Or you may prefer to simply gather information until you get a better sense of what location aligns most closely with your needs.

Where should you look for the information you need? You’ll find lots of options on the web. Start with general interest travel sites. Websites such as Lonely Planet, Travel + Leisure, and Atlas Obscura are great resources for destination information and retirement travel ideas. Then you can narrow down your research by looking at sites for a destination’s tourism boards and visitor’s bureaus.

You may also want to look for independent reviews of specific facilities, hotels, restaurants and accommodations on sites such as Yelp, Better Business Bureau, and individual Facebook pages for each business.

6. Take your physical abilities into account

As you get older, it’s important to consider your health concerns, physical abilities, and activity restrictions as you choose a destination. It’s important that you ensure your own safety and comfort in all aspects of your trip. If you have mobility issues, for example, a destination with good accessibility options and a less strenuous pace of travel might be more suitable.

To keep yourself well and safe, research the accessibility of the destination and all locations you expect to visit. Look into the availability of emergency and walk-in medical care services. Are there services that might be tailored for senior travelers? For example, concierge medical services or tour guides that specialize in helping older visitors navigate area attractions. You’ll also want to get some idea of any associated potential safety risks that the location might pose to visitors who aren’t fully able-bodied and familiar with the terrain.

7. Think about the weather

The weather can have a big impact on your travel experience. Researching the weather and climate of potential retirement travel destinations is an important part of the decision-making process. Knowing what to expect in terms of temperature, precipitation, and other weather patterns can help you choose the destination that best suits your preferences and needs.

Consider the time of year you want to travel and the climate of your destination. If you have health issues that are affected by extreme weather, this is especially important to consider. For example, many people say that cold and rainy weather exacerbates joint and arthritis pain. On the other hand, hot temperatures can make neuropathy and other nerve-related pain worse.

Start by finding out which of the several available weather forecasting sites have the best track record for accuracy for the area in question. Enter the destination name or its zip code at Forecast Advisor. Two sites that consistently rank well for accurate forecasts across the country are Accuweather and The Weather Channel.

You can look for historical data as well. Use the process outlined on the federal government’s National Weather Service website. This should give you a broad idea of what the weather is like for a specific destination during the time period you’re thinking of visiting.

8. Don’t forget about the logistics

The logistics of a trip to a particular destination can make or break “the trip of a lifetime.” These details might seem small or even inconsequential but can add up to major headaches and challenges:

• The total length of travel time (longer flights may mean a greater risk of deep vein thrombosis and other health risks for some travelers)
• Layovers (especially when you’ll need to switch planes, trains, or gates)
• The extent to which you speak the local language and the availability of translation services
• The difference in time zones, which can throw you off your schedule and complicate medication routines
• The availability of local travel between your hotel and sites or other attractions you’d like to visit, if you’re not renting a car once you’ve arrived

These factors can impact your overall travel experience and should be taken into account when choosing the right destination.

9. Keep an open mind

Finally, don’t be afraid to step outside of your comfort zone. Try a destination that’s a bit outside your usual wheelhouse. If you’re usually a fan of beachside resorts, why not explore the mountains? Or, if you usually shy away from large cities in favor of more isolated locations, perhaps a mid-sized city could be the perfect way to expand your horizons.

You never know — you may discover a new favorite place to visit.

The post How to Choose the Right Destination for Retirement Travel appeared first on Due.

Where did the term “nest egg” originate? To encourage the hens to lay more eggs, farmers used to leave one egg in the henhouse. Today, nest eggs typically refer to retirement savings that you do not touch until you retire. It’s the money you save for the future so that you have something to fall back on when you retire. In many financial plans, the stated objective is to grow your nest egg.

Nest eggs come in a variety of types. Often, the strategy involves saving or investing a sum of money or other assets for long-term objectives such as retirement, paying for college, and buying a house. Additionally, nest eggs can be used to cover emergency expenses for medical care, dentistry, repairs to cars and homes, and job loss.

Many employees contribute part of their paycheck to a long-term retirement savings plan in order to build a nest egg for retirement. In terms of saving for retirement, there is no single right amount. Some retirees may be able to live on less than a $500,000 nest egg, for example. Other people may need more, depending on their location, lifestyle, and number of dependents they have. You can use a retirement calculator to figure out how much to save.

Unfortunately, not all Americans have access to long-term savings. Despite Americans’ awareness of the need to save and build a nest egg, many are unprepared for retirement. As a matter of fact, 47% of households nearing retirement report financial insecurity, including 20% who are dependent heavily on Social Security to support their retirement. In addition, 27% are financially unable to maintain their standard of living from their working years.

The good news? Just like predator-proofing a chicken coop, there are effective ways to protect your nest egg.

1. Set retirement goals.

According to Gallup, seven in 10 U.S. adults are planning to set goals for themselves at the beginning of the new year, one-third are “very likely” to do so, and 38% are “somewhat likely.”

Most Americans intend to set goals, but younger Americans are more likely to do so than older Americans. About eight out of ten (18-34-year-olds) and 72% of those 35-54 years old say they’re likely to set goals, compared to 62% of those 55 and older. There is also an age difference among those who are “very likely” to set goals, with the youngest group being 40% and the oldest being 25%.

College graduates and high-income adults also have a higher rate of goal-setting than their counterparts, regardless of gender.

There has been a link between financial goal setting and positive outcomes, according to research from Lincoln Financial. It is more likely that participants who set goals will save money.

• Three times as many participants contribute 15%+ to retirement when they have a retirement savings goal.
• Deferral rates are almost 2x higher among participants who set savings goals other than retirement.
• Those who set a debt payment goal are almost twice as likely to contribute 15%.

In short, you should always set and stick to financial goals regardless of your age if you want to protect your nest egg. Your nest egg should not be dipped into without your permission by friends or family members. Likewise, don’t let family members guilt you into withdrawing money from your nest egg too early.

You need a clear financial goal when you’re setting your nest egg goals. Put your all into it, and don’t let anything but absolute emergencies sway you. Ultimately, it is you that has the greatest chance of ruining your nest egg.

2. Take advantage of employer-based savings.

Your main savings tool will often be employer-sponsored retirement plans such as a 401(k), 403(b), and others. Taking advantage of employer matching funds multiplies your savings for free. Suffice it to say, try to find jobs that offer them.

401 (k) investment options.

The majority of 401(k) plans offer a variety of investment options for you to choose from. Typical investment options include:

• Money market funds
• Bond mutual funds
• Stock mutual funds
• Deposit accounts with stable values, such as guaranteed investment contracts (GICs)
• Stock in your own company

There are different levels of risk and reward associated with different types of investments. As an example, money market funds and stable value accounts typically invest in certificates of deposit (CDs) and U.S. Treasury securities. Although they have lower earnings potential than other types of investments, they don’t always keep up with inflation. Over a long period of time, stocks and bonds can earn much more than they risk losing their value.

You can usually mix and match different options to manage your account balance. Please review your plan documents to determine if any restrictions apply to when or how often you can request changes. It is easy to make these kinds of changes online with most plans.

In addition to age and how early you start saving for retirement, other factors will influence your tolerance for risk. Consult a financial advisor to determine the right mix for your 401(k) investment options.

Tax advantages of a 401(k).

You contribute directly to a traditional 401(k) before federal income taxes are withheld. You may owe less in income taxes because the contributions are pre-tax, regardless of whether you itemize or take the standard deduction. There is even a possibility that it will lower your tax rate.

When you withdraw your pre-tax contributions in retirement, they are tax-deferred. It is assumed that you will be in a lower tax bracket in retirement compared to now.

Don’t forget that there are limits on 401(k) contributions.

Contributions to 401(k)s for 2023 are limited to $22,500 for employees and $66,000 for employers and employees combined. A catch-up contribution of $7,500 is available to people over 50, raising the employee contribution limit to $30,000.

3. Put money in an IRA.

A 401(k) plan is one of the most popular retirement plans, with 72% of Americans having access to it in 2022, according to the Bureau of Labor Statistics. An IRA can help you avoid some 401(k) problems, even if you already have one.

For instance, you cannot own 401(k)s; for example — you can only participate. Without your consent, your employer can change or limit the investment options of your plan. Additionally, leaving your job means losing your ability to contribute to your 401(k).

You can, however, keep an IRA. Even if you switch jobs, you can continue to access your 401(k) and roll it over into an IRA. Stocks, bonds, mutual funds, and exchange-traded funds (ETFs) are among the investment options offered by quality IRAs.

And a self-directed IRA lets you customize your portfolio to meet your financial needs, risk profile, and retirement objectives.

Tax benefits are also unique to IRAs.

A traditional IRA offers the advantage of tax-deferred growth until age 73 when you must begin taking minimum distributions. Traditional IRAs involve greater upfront investment than regular brokerage accounts. Investing now (and over time) may result in you having to withdraw more when you retire.

Depending on your income level and whether you have a workplace retirement savings plan (or your spouse if you’re married), your traditional IRA contributions may be deductible.

When you reach retirement age, a Roth IRA will give you that tax break you’d receive from a traditional IRA. In retirement, you do not pay taxes on your earnings and withdrawals since you contributed after-tax dollars. Young investors, in particular, benefit from this.

But, as with a 401(k), there are contribution limits. For 2023, you can contribute up to $6,500, or $7,500 if you’re 50 or older.

4. Ensure your retirement goals and insure your money.

You can prepare for your financial future and for unexpected situations regardless of your generation, life stage, or financial goal. For example, when you or your family suffers an illness or injury, you might be able to use nonmedical employee benefits to cover the costs.

It’s likely that your employer offers several insurance benefits, which can help cover unexpected medical expenses or accidents. As an example, accident insurance helps pay for deductibles and copayments not covered by medical insurance.

A critical illness policy provides the cash you can use for everyday expenses, such as a mortgage, childcare, and food. In the meantime, disability insurance can help protect your paycheck in case you become sick or injured and are unable to work.

Additionally, you may want to invest in long-term care insurance.

According to Martin Insurance Agency, 70% of people will require some kind of long-term care after 65 – and it can be costly. In general, a home health aide costs around $20 an hour. That’s the equivalent of hiring a full-time employee at $42,000 a year. In addition, a private nursing home can cost up to $100,000 per year.

The problem is that many people believe their health insurance will cover that or that a government program will take care of it. However, that isn’t true for the most part. In most cases, health insurance pays only for doctor and hospital bills. You can only receive Medicare coverage for short-term skilled nursing home care, and Medicaid only covers care if you have very limited assets. Your savings or retirement fund will most likely be used to pay for your care, which can be costly.

Make sure your retirement nest egg is protected with Long-Term Care Insurance. Rather than delaying this, consider getting long-term care insurance at a time when you’re healthy, and your premiums are affordable.

Your employer, an association, or a membership group may offer long-term care insurance. Alternatively, you can consult with an agent to ensure you get the best plan suited to your budget and needs.

5. Set aside a buffer amount.

You might also want to consider setting aside a certain amount of cash in your nest egg as a buffer. Consider saving $2 million for retirement, for example. You might want to consider saving $2.50 million for retirement instead if you have the financial capability.

In the event of a family emergency or a medical crisis, having a bit of a buffer, regardless of how much, can prevent your nest egg from being depleted. Your retirement nest egg may help you keep your $2 million retirement goal if you need to use some of it right now for an unexpected surgery.

In short, the buffer amount may prevent you from losing too much of your nest egg.

Don’t know where to begin or how much to pursue? To figure out the following, use a portfolio analysis tool:

• What is the performance of your portfolio in relation to your goals?
• What other portfolios can you invest in, such as mutual funds, to get better returns?
• Are you paying more than you should in hidden fees or other expenses?

When you use the right portfolio analyzer tool, you can significantly increase the growth rate of your nest egg and improve the stability of your financial situation.

6. Delay filing for Social Security.

Getting your biggest benefit doesn’t mean waiting until you’re 70. It does, however, mean waiting until full retirement age (“FRA”), which is currently 67 for those born after 1960. In the first three years after age 67, you’ll have to pay 6.67%, and for the next two, you’ll have to pay 5%, which can amount to a reduction of 30%.

In times of high inflation, it is even more imperative to get the most out of your Social Security benefits. It can substantially reduce the need to withdraw from personal savings when you know you will receive a certain amount of guaranteed income for the rest of your life. Future growth prospects can be undermined when stocks are sold in a falling stock market.

While some people prefer to delay claiming their benefits, others struggle — especially in their early 60s when they have little income and need it desperately. It doesn’t matter what you decide, you’ll still receive quite a bit more if you wait until after you retire.

7. Safeguard your money against inflation.

“Inflation’s impact on your retirement funds can be scary,” writes Lyle Solomon in a previous Due article. “Suppose you’ve set aside $1 million for the future and plan to spend $50,000 annually.” If inflation and rate of return remain at 3% each year, that $1 million would last 20 years. If inflation increased to 12 percent annually, $1 million would run out in 11 years and nine months.

“People worry about running out of money while planning for their retirement, even when sailing,” he adds. “The possibility of price increases merely intensifies the already existing worries.” Regardless of how well you plan your retirement, inflation is an unpredictable factor that can disrupt it. Overall, inflation is the enemy of fixed incomes.

Fortunately, there are ways to protect your nest egg against inflation:

• Don’t hold too much cash. Having cash on hand is a good idea for big purchases or emergencies. When inflation’s high, you shouldn’t use cash for long-term investments. As inflation increases, your ability to buy goods with cash decreases. Consider long-term investments if you have enough cash to keep your buying power.
• Reassess your portfolio. To resist excessive inflation, you need to invest in assets that can help you preserve your purchasing power over time. In most cases, young investors should stick to a portfolio that emphasizes stocks. You can beat inflation with alternative investments like commodities and inflation-protected bonds.
• Earn money from real estate. You can beat inflation by renting out real estate. Inflation makes property prices climb so that you can charge more rent. Compared to buying stocks, managing a property and charging the right rent takes a lot of effort. However, if you want to diversify your income during inflation, this is a great option.

8. Don’t pay unnecessary taxes.

When you retire, you may have to pay regular income taxes even if you have tax-advantaged retirement accounts. Tax-deferred accounts are recommended for stocks paying low dividends (or none), as well as stocks paying high dividends and taxable bonds.

The ideal situation is to place dividend and capital gain mutual funds in a taxable account with municipal bonds, which are not federally (and sometimes state-) taxed.

9. Track your withdrawal rate.

It is important to stay up-to-date on withdrawal rules for your retirement or investment accounts in order to protect your nest egg. For example, you shouldn’t withdraw funds from your IRA until you are 59 ½. At that point, withdrawals from such accounts are no longer penalized.

It is possible, however, that this rule will change down the road. To maximize your return, you must be ready to change your withdrawal and contribution plans if it does.

10. Take a look at single premium immediate annuities.

Annuities with a single premium (“SPIAs”) may be suitable for retirees who have a low percentage of guaranteed income relative to the size of their assets. If you don’t have a pension or limited Social Security benefits, you are more vulnerable to market changes than those who have a more stable income. Furthermore, those who rely solely on stock-related savings face longevity risk or the possibility of outliving their savings.

An SPIA allows you to annuitize part of your assets, allowing you to generate income and reduce your need to access your portfolio when the market declines. In contrast to some of the more complex annuity products, the fees are usually more affordable. In exchange for the certainty that annuitization provides, you should expect to pay something in the range of 1% to 3% annually.

11. Your retirement should be timed to coincide with your spouse’s.

I’ll be honest here. There are complicated rules for spousal benefits under Social Security. So, to ensure your savings are protected and you do not pay unnecessary income taxes by signing up for benefits at the wrong time.

In short, if you’re both nearing retirement, make sure you’re both on the same page.

12. Learn self-defense.

Not literally. Rather, this is about avoiding becoming a victim of a scam. It’s worth mentioning that there were 92,371 elderly fraud victims in 2021, and some scams cost victims more than $50,000.

Avoid being a courtesy victim.

Your good manners will be exploited by con artists. Only be courteous to friends and family.

Don’t be fooled by strangers offering strange deals.

Never make an immediate investment decision without checking out the salesperson, firm, and investment opportunity first. In your state or province securities agency’s Central Registration Depository (CRD) files, you can find extensive information about investment salespeople and firms. Click here to find the contact information for the securities regulator in your state or province.

Keep track of your money at all times.

Do not trust someone who asks you to invest in something you do not understand or who tells you to leave everything to them.

Don’t make rash financial decisions during a tragedy.

When you suddenly find yourself responsible for your own finances, get the facts before making any financial decisions. You may be able to learn about investing at your local library or university. Consult friends, family, trade associations, and state or provincial securities regulators for recommendations on finding and checking a financial professional. Insurance settlements can help with expenses, but they also make you an easy target for scammers.

Ask tough questions about your investments.

Keep an eye on the progress of your investment if you trust an unscrupulous investment professional or outright con artist. Make sure you receive regular written reports. Watch for signs that your funds are being traded excessively or without your permission.

You may have trouble retrieving your principal or cashing out your profits.

When you try to withdraw your principal or profits from a stockbroker, financial advisor, or another individual with whom you invested, they stall you. Prior to investing, make sure you are aware of any restrictions on withdrawing your funds associated with certain types of investments.

Avoid “reload” scams.

Don’t let con artists take a “second bite” of your assets after you have already been scammed by an investment scam. Those who con you know that your money is limited. Having lost funds once, some seniors who have been scammed will go along with another scheme promising to recover those lost funds and maybe even more. All too often, when you attempt to make up for lost financial ground, you end up losing whatever savings you had left.

13. Start working part-time.

In theory, retirement should mean that one’s working days are over. However, now that part-time (and often remote) jobs are becoming the norm working in retirement can be a useful way to reduce portfolio stress.

Let’s suppose that you’ve determined that $50,000 is your annual spending need in retirement. Using the 4% rule would result in an overall retirement savings requirement of $1,250,000.

You can effectively reduce portfolio withdrawals by the same amount by working a part-time job that earns $20,000 per year (just under $400 a week). In the first year, you don’t have to withdraw $50,000 from your portfolio, but only $30,000.

In other words, your savings are best protected if you make even the smallest amounts of income. By earning additional income, you can regain control over your finances by being able to adjust your spending according to unexpected market movements.

14. Avoid panic selling.

When the stock market is going down, never panic sell.

No matter how bad the economy is or how bad the market looks, it always rallies. You’ll lose your nest egg if you panic and sell your assets for less than their market value. Until the economy calms down, it may be a good idea to weather the storm.

15. Managing RMDs in retirement.

Even after retirement, keep an eye on your finances.

In this case, get your 401(k) or IRA’s spend-down plan aligned with your retirement dreams and goals before required minimum distributions (RMDs) begin at age 73.

FAQs

What is a nest egg?

Nest eggs are sums of money saved for future use. Generally, when we talk about a nest egg, we mean a retirement account. When you set money aside during your working years, you can build a strong investment portfolio so you’ll be able to support yourself financially later on.

What can you do to make sure your retirement nest egg lasts?

Although there are few hard rules when it comes to retirement, the 4% rule is one popular rule of thumb. According to this rule, you should be able to withdraw 4% of your savings every year during retirement, with simple adjustments for inflation. You are highly likely to be able to maintain your savings for the rest of your life if you follow the 4% rule.

After the age of 73, however, some accounts require required minimum distributions (RMDs).

Is there such a thing as a good retirement nest egg?

By the age of 67, Fidelity recommends saving about ten times your annual income into a retirement account. You should save one year’s salary by the age of 30, three years’ salary by the age of 40, and six years’ salary by the age of 50, based on that standard.

This sounds like a lot — I know! Forget getting all uptight about what you have to do and, perchance, not doing anything. Do the best you can — just move forward on your financial goals. Keep these thoughts top of mind and work toward your goal, and with compounded interest, you will do better than you think you can. You can do this! Be brave! Just keep going.

In case you fall behind in your IRA or 401(k) contributions, you can make catch-up contributions.

Where should I house my nest egg?

Your best option for storing your retirement savings is in a traditional IRA or 401(k), which are tax-advantaged. Contributions to both accounts are tax-free, and they also grow tax-deferred over time, which is a valuable benefit. Investment gains will not be taxed until you take withdrawals from your investments in retirement.

Alternatively, you can invest in a Roth IRA or 401(k). You won’t get an immediate tax break by doing this, but your money will grow tax-free, and your withdrawals won’t be taxed either.

To give your nest egg the best chance of growing, it’s essential that you save as much as possible as early as possible. In order to enjoy a comfortable retirement, you must have a strong nest egg.

What is the best way to start saving for retirement?

Investing early allows you to grow your money thanks to compound interest, which is one of the most important retirement rules. 401(k), IRA, and Roth IRAs are tax-advantaged retirement accounts that do not incur ordinary investing taxes.

The post Retirement Risk Management: Protecting Your Nest Egg appeared first on Due.

The Rule of 72 is a general mathematical guideline, in financial planning, that determines how long an investment portfolio will take to double. The Rule assumes a fixed rate of return (ROR), and calculates how long (years) it will take a portfolio to double in size, given that fixed ROR. This is an important concept to understand, for both retirees, and even active savers, who depend on fixed-rate investments to deliver the lion’s share of the returns from their nest’s egg.

Great Minds Have Spoken

Albert Einstein, the noted mathematician, and the most influential physicists of many generations, reportedly attributed compound interest as being one of the more remarkable “inventions” of the world. A quote, credited to Einstein, goes like this:

“Compound interest is the eighth wonder of the world. He who understands it, earns it…he who doesn’t…pays it!”

For retirees, and those nearing retirement, as well as millions of working people who will eventually join the ranks of retirees, a deep understanding of compound interest is critical. The connotation here is simple: As your savings grow with interest, that interest attracts further interest, spurring the growth of your retirement nest egg. It is this virtuous cycle, of growth attracting even more growth, that has led many analysts to describe the phenomenon of compound interest as “Interest on interest”.

Compound interest is a relatively well-known concept, used by financial institutions that help you save and borrow. However, the world of finance also harbors a lesser-known, yet equally important piece of math: The Rule of 72.

The Rule of 72 Unveiled: How doubling works

At its simplest, the Rule of 72 (the Rule) is a mathematical calculation, with compound interest at its heart. The Rule provides a quick way for anyone to estimate how long it will take for a sum of money to double (or to halve – if we’re looking at inflation’s impact on savings). To understand the application of this “quick method”, let’s first look at an example using the traditional method of computing compound interest.

We’ll assume that a saver has $10,000 to invest, and that the current investment opportunity yields a 12% rate of return. If this investment were to return simple interest, over a 6-year time horizon, it would deliver a steady stream of interest ($1,200) each year, to produce a total return of $17,200 – the original principal of $10,000 + $7,200 interest each year – by the end of year 6.

However, what if we threw the power of compounding into the mix, to work its magic?

The most striking difference between the two investment scenarios, that retirees will immediately pickup on, is the total return they enjoy with compound interest. Over the investment horizon, they’ll enjoy $2,538 ($9,738 minus $7,200) more interest through compounding, than they will through simple interest. But that’s not the only striking feature that compounding delivers to an investment portfolio.

Notice the rose-colored column in Table 2. The ending balance in year 6 is almost double the initial principal of $10,000. We arrived at that conclusion through a series of six iterative calculations. However, if this retiree wanted a quick answer to the question:

“How long will it take for my nest egg to double?”

…thanks to the Rule of 72, we could provide them the answer in short order!

The answer is: Approximately 6-years, and we calculate it by dividing the constant 72 by the interest rate. In this example, 72 divided by 12 = 6, which approximates the result we achieved after six iterations of calculations in Table 2. Later in our discussions, we’ll see how to use the Rule in conjunction with inflation, which has the impact of diminishing our savings.

The Mechanics of the Rule

The Rule, as illustrated in the above examples, seems rather straightforward and simple to understand: 72 divided by a compound interest rate. The more mathematical-minded amongst us, however, would resort to a more intricate formula involving a natural Logarithm calculation. Here’s the spreadsheet (Microsoft Excel) equivalent of the Rule using Logs:

Applying this formula to the variables in Table 2, we get the following result:

…which is a more accurate answer to the retiree’s question. We’ll very briefly revisit the Log formula later in this discussion. However, when financial calculators and spreadsheets aren’t readily available, the Rule seems to provide us a relatively close approximation (6-years).

Variations to the Rule

There are several variations of the Rule that retirees can use to forecast the doubling (and halving) effect of interest (and inflation) on their nest egg. Although the difference in results, produced from these variations, is negligible, they may be meaningful to some. These variations are a good spin on the original if you wish to “personalize” your forecasts.

In general, the “base” denominator of the Rule of 72 appears to be 8% (more on this later). To produce a “variant” formula, one must adjust the numerator (72) by 1 (either up or down), for every 3-point difference in rates from the “base” denominator (i.e., 8%).

In Table 3, because “5%” is one 3-point deviation down from 8%, we subtract 1 from 72, to get a variant numerator – i.e., 71. And because “11%” is one 3-point deviation up from 8%, we add 1 to 72, to get a variant numerator – i.e., 73.

As you can see from the calculations in Table 3 above, there is a slight difference between the doubling calculated under the Rule of 72 (e.g., 14.40 years @5%), and those performed by the variant rules (e.g., 14.20 years @5% under the “rule of 71”). However, where the retirement portfolio contains many individual investments, or if this is a sizable portfolio spanning decades, then those differences could add-up to build wealth for you and your family.

Limitations and Exceptions to the Rule

So, is the Rule of 72 a useful tool, and does it work? At its core, the Rule of 72 (we’ll ignore some of its variations for this discussion, but the same logic applies to those variants too) represents a relationship between two numbers – a constant numerator (72), and a denominator (which can represent one of several elements – more on that later). This comparison works well to highlight a mathematical relationship between those two numbers – that’s basic math. However, there are limitations and exceptions to the Rule that retirees and investors shouldn’t discount.

• As discussed previously, retirees must consider the impact of inflation when using the Rule as a meaningful resource. While rates of return increase a nest eggs’ value, inflation erodes it
• The Rule works well when used with certain denominators, including 2, 4, 6, 8, 9, and 12 (be they percentages or years). That’s because 72 is equally divisibly by them
• The Rule produces its most accurate result at 8%. As interest rates increase or decrease above and below that threshold, however, slight deviations in the results, produced by the Rule versus the more accurate Log formula (discussed in The Mechanics) creep in.
• Do those minor variations discredit the Rule as an effective quick-forecast tool? Absolutely not! Retirees and investors may also use one of the variations of the Rule to customize the results for their unique situations – but even those variants are bound by the same general principles governing the Rule of 72
• Most significantly, the Rule is a powerful ally when dealing with fixed-rate investments, such as fixed annuities and certificates of deposits (CDs). That’s because the Rule factors a single denominator, and is therefore unsuitable to account for variable rate annuities

With a slew of variables impacting the future growth of an investment, the Rule is but one tool – albeit a simple and powerful one – to quickly forecast growth (doubling) and erosion (halving) of an investment, based on the single denominator used. It cannot, however, act as a financial prediction modelling tool.

Broader Applications

As a retiree, an employee considering their impending retirement plans, or even as a cautious investor, the Rule does provide you with a convenient, back-of-the-napkin tool to predict when your savings will double. It gives you some mental relaxation by helping you avoid doing some onerous math. Perhaps, instead of firing-up that calculator, or building a spreadsheet, you can even use this handy graphic, courtesy of the Federal Reserve Bank of St. Louis, to do a quick look-up when pressed for time.

But the Rule, which involves a simple, one-step division exercise, has broader application than simply predicting when your nest egg will double in value. While in the same vein as “doubling”, here are some broader useful applications of the Rule:

1) Credit Card and Other Debt:

Most lenders (especially credit card issuers!) encourage borrowers to “just let the debt roll on…don’t focus on repaying it!”. Instead, they encourage borrowers to focus on enjoying that new car, beautiful home renovation, or much-deserved retirement vacation. Let’s see what sanity check the Rule provides us:

Assume you charged $5,000 to your credit card for that home reno project, and your lender charges you a “very competitive” 12% interest rate. If you don’t start chipping-away at that debt, gradually and systematically, within six years (72 divided by 12 = 6), you’ll owe $10,000 on your credit card. The Rule quickly tells you that within 6-years, you’ve racked-up as much interest on that loan as the amount of principal you originally borrowed!

Entering retirement with any amount of debt is risky. But owing twice as much as you initially borrowed, just as you plan on hanging up your gloves and calling it a day, is downright irresponsible.

2) Inflationary Impact:

Inflation has an inverse relationship on your retirement nest egg compared to interest. But essentially, the application of the Rule is the same. While the numerator remains 72, now you substitute the rate of inflation as the denominator. And our interpretation of the result changes -from doubling to halving.

Let’s suppose someone you trust (so there’s no risk to your investment) approaches you and asks for a loan of $5,000 for a 12-year term. They promise to pay you at a healthy 12% annual rate, with the principal and interest paid at maturity. On the face of it, this looks like a great opportunity – give them $5,000 today, and 12-years later collect – risk free – nearly $19,500 ($19,479.88 to be precise!). What’s not to love? Well, let’s introduce you to the party spoiler – inflation. Assume inflation runs at a steady 6% over the duration of the term.

If you do some quick math using the Rule of 72, you’ll see that inflation will halve your principal in 12 years (72 divided by 6 = 12). In effect, instead of receiving $19,479.88 at maturity, you’ll only receive $16,979.88 ($19,479.88 minus $2,500) – in real terms. These are somewhat simplistic calculations. In real terms, however, you’ll receive much less than $16,979.88 because inflation will also erode accumulated interest (…but’s a discussion for an Advanced Financial Math class!).

3) Estimating Expected Rate of Returns:

Finally, as a retiree, you’ll often be tempted to jump in with both feet when slick investment advisors make compelling pitches “Double your money in no time with this once-in-a-lifetime opportunity”. Can the Rule help you make an informed decision? Absolutely!

If you wanted to double your investment over a specified time-horizon, what would it take to make that happen? Let’s assume your same trusted source pitches you an idea: Give me $5,000 for 8-years, and I’ll guarantee you an annual rate of return (ROR) of 7.5%. We’ll park our party-spoiling inflation outside the door for now, and use the Rule to assess whether you’ll manage to double your investment with that pitch.

Because it’s the rate we’re looking to calculate, we’ll need to re-jig the formula we’ve used so far, to now use the investment time as the denominator (instead of the usual rate parameter).

The result: If you wish to lock-in your money for 8-years, in the hopes of doubling it, then a 7.5% ROR just won’t cut it. Thanks to a slightly re-worked Rule of 72, you’ll quickly ascertain that you’ll need at least a 9% (72 divided by 8) ROR to achieve your goal of doubling what you invested.

Although we’ve deliberately kept the examples here relatively simple, they still serve to underline the core principles of the Rule – that compounding cuts both ways. As Einstein noted, whether it’s earning it or paying it, the Rule is a quick-n-dirty formula to use for judging the impact that compounding (interest and inflation) has on a retirement nest egg.

The post The Rule of 72 Explained: How Long Will it Take to Double your Savings? appeared first on Due.

In today’s world of economic uncertainty, managing your finances can seem like a daunting task. Shifts in the market and inflation are making it harder to make ends meet for millions of people. Heck, even buying eggs has become financially complicated this year.

Being in charge of a business during this time takes a team of people to be successful. Over the course of every entrepreneur’s lifetime, they hire the following: an accountant, an attorney, insurance agents (both personal and business), a banker, an investment adviser, etc. The list goes on. What’s more, finding the right people that you can trust is a job all its own.

As a result, many entrepreneurs may feel as though they’re stuck in the middle facilitating communication between parties. A family office is an interesting solution to this problem, and it’s no longer reserved for the top 1%. You can read about the different areas that can affect family wealth in a variety of finance publications.

Recently, I spoke with Jim Dew, CEO of Dew Wealth Management, about the benefits of a virtual family office for entrepreneurs. I was extremely impressed by how having the right team and structure can yield great financial results. And, it makes sense; The rich get richer because they use specific strategies to grow and protect their wealth. Here’s what entrepreneurs need to understand about utilizing a family office for wealth management:

What is a Family Office?

Billionaires have had a century-long secret advantage when it comes to building and sustaining wealth. It’s called the family office. Before deciding if a family office is right for you, it’s necessary to fully understand what it is. This structure is what virtually everyone in the “billionaire’s club” creates when they get seriously wealthy.

To build a family office, a billionaire will hire all the necessary professionals as full-time employees. Specifically, these new hires will work for that one billionaire and his or her family. Think along the lines of tax, legal, insurance, and investment experts– along with attorneys and accountants. Needless to say, a traditional family office is expensive to build and run.

However, it’s worth it when you’re managing a financial empire. That’s why Bill Gates, Oprah Winfrey, Jeff Bezos, and Sarah Blakely all have a family office. For everyday entrepreneurs, this structure is still beneficial–but likely unreasonable– from a financial perspective. Despite the cost, a modified virtual structure is likely possible to attain.

Connections Every Family Needs

To better understand how a family office operates, we’ll review a few key things. This includes each position typically hired, how they communicate, and how they benefit each other. It’s worth noting that positions and components can be adapted to your business and lifestyle needs. For instance, you may find that you don’t need a full-time CFO, and instead could have a coordinated effort on financial analysis by using an outsourced part-time CFO in cooperation with an accountant and bookkeeper. You might also find an estate attorney who specializes in asset protection structures.

Accountants

As a business owner, you likely already engage with at least one trusted accountant. If not, it would be wise to consider doing so. This trusted accountant is a tax expert who keeps track of your bookkeeping–or works with your bookkeeper– to make sure you stay in the black. For example, they might audit your books, prepare payroll tax reports, or simplify all the financial rigmarole and minutia that come with running a business. When establishing a family wealth office, it’s important to have an accountant who can communicate your financial standings and work in your interest to reach financial goals.

Investment Advisers

Investing is a valuable way to grow your wealth. So, it’s a good idea to utilize investment advisers who will be able to work with you and your accountants and ensure that you’ll see positive returns. A family office may be responsible for investment portfolio management, private equity deals, hedge fund investments, and/or venture capital investments. If you’re interested in commercial real estate, they may also handle real estate purchases, sales, and property management. Like everyone else on your team, these professionals are available to help grow and protect your wealth.

Tax Planners

Many accountants are tax historians rather than tax planners. For instance, a tax historian might all the correct forms at the right time, but is looking in the rear view mirror. What you need in your family office is a tax planner. A tax planner proactively looks forward and presents you with ideas on how you can legally save the most possible money in taxes.

This tax expert could potentially be your accountant–or they could be an expert that works with your accountant– that can ideate strategies to help you pay the least amount of taxes legally possible. No matter the case, they are able to help when it comes to tax matters. For example, they might even find tax savings that you can receive by amending past returns. It’s like finding that $20 bill in your pants pocket that you didn’t know you had! Above all, professional tax consultants should prioritize knowing the tricks of the trade and staying current with changing state and federal tax laws.

Insurance Experts

Everyone needs insurance to protect their belongings. But, as you grow your wealth, this becomes even more important. Insurance transfers risk, therefore it is the key to a defensive financial strategy. Additionally, there are tricks of the trade that insurance experts know, which can benefit you and your family in the long run.

Insurance is your first line of defense when it comes to asset protection. Making sure that you have the right coverage and that trusts or entities are listed as additional insureds are some of the details that entrepreneurs often miss. Moreover, entrepreneurs need business insurance like EPLI (employee practices liability insurance) and cybersecurity (for things like ransom attacks). Having good experts for personal and business coverage are absolutely essential in a family office structure.

Attorneys

Another aspect of protecting your wealth is to avoid lawsuits that could take it away. Having an attorney on your side means having someone to advise and represent you or your family. Whether it be in court, before government agencies, or in private legal matters, they’re able to act on your–or your family’s– behalf. They can interpret laws, rulings, and regulations for individuals and businesses, which becomes more important as your wealth grows.

It’s also crucial to have a trusted attorney who’s able to help with estate planning. Every business owner needs to have an estate plan, because death is inevitable. If you don’t have an estate plan already, it is highly recommended to prioritize having one. While many people understand that an estate plan allows you to name the people or organizations you want to receive your belongings after you die, it’s much more than that.

You should also factor in things like instructions for your care and financial affairs if you become incapacitated. Essentially, this means designating a power of attorney and funding assets into a living trust. You’ll want to update beneficiary designations and name a guardian for your minor children’s care and inheritance. While it’s important to think of your family and your own well being during estate planning, a major asset that needs consideration is your business.

Considerations you would need to make for your business would include deciding whether you’ll want to transfer or sell. Regardless, both of those options include paperwork. The articles of incorporation and operating agreement of your business can work collaboratively with your estate documents to help smoothen out this process.

It’s important to note that estate planning is an ongoing strategy, not a one-time event. You should review and update your plan as your family, financial circumstances, and laws change throughout your lifetime. That’s just one of many reasons why having an attorney on your team will help you, your loved ones, and your business.

The Benefits of a Family Office

If you are the type of person who believes you can do it all — let’s be honest, most entrepreneurs are — it may be difficult to relinquish control and let someone else take the reins. It might even be hard to let other people give you advice. But, in the long run it benefits you in so many ways. You’re able to save time, which you can then reprioritize in order to work on your business or spend time with your family.

A family wealth office allows you to spend time on the things that matter most to you. It’s a centralized resource that you don’t have to manage. Consequently, since you don’t need to juggle everything, nothing slips through the cracks. Experts, because of their passions and industry knowledge, are able to spot the things you don’t see.

How to Create Your Own Virtual Family Office

One of the most difficult issues with having multiple advisers and consultants is navigating the collective team management. Typically, they aren’t communicating or collaborating with each other on a regular basis to achieve the best outcome for the entrepreneur.

This means you’re responsible for the whole infrastructure, which takes precious time away from your other responsibilities. To make matters worse, you likely don’t speak the languages of tax, law, insurance, or investments. With a virtual family office, that responsibility is offloaded onto a wealth planning firm.

The first step in building a family office is to evaluate your current team of advisers. You might have to manage this by yourself until you are in a stable and successful financial state to hand this off to the right wealth planning firm. Typically, your current advisers are not all “A” players. You’ll want to keep your top performers and replace the advisers who are not achieving the necessary results. The appropriate wealth planning firm will have the required expertise to oversee and communicate with your advisers and start managing the moving pieces.

The Bottom Line

As Jim Dew said, “Billionaires want a team that only works for their best interest and so should you.” When it comes to a family office, you want a team of people that can protect, manage, and grow your wealth. In the long run, family offices can save you time and help you live the life you want. By combining asset, cash, risk, and lifestyle management with financial planning, family offices help clients navigate the complex world of wealth management. As an entrepreneur, using a family wealth office is a smart strategy to prepare for the future and your legacy.

The post A Guide to Using a Family Wealth Office appeared first on Due.

It turns out that when the going gets tough, the tough take on side hustles. According to an Insuranks survey from 2022, 93% of Americans have a side job. And their most common reasons for getting into the gig economy aren’t surprising: earning cash and paying bills. Inflation is high, after all, and every little bit counts.

Due – Due

Of course, most side gigs aren’t going to bring in millions. But even a modest one can free you up financially. Maybe you’ll be able to get a degree, take a vacation, or save for retirement. Or perhaps you can substitute a flexible hustle for your current part-time work to be home with your kids. That way, you won’t have to lose money to parent your way.

Regardless of why you’re considering joining the hustle, you may want a few tips to get started. Below are several of the hottest types of gigs happening in 2023. Some have very low barriers to entry, making them ideal for just about anyone.

1. Transporting People

One of the biggest side hustler trends is driving for a rideshare company like Uber or Lyft. All you need is a vehicle and insurance to get started. Then, you can work the hours you like and meet interesting people. Salary.com estimates that the median annual income earned from Uber or Lyft is around $37,400. But, of course, this number depends on many variables, including the city you’re driving in and how many hours you’re willing to drive per week.

Since rideshare drivers don’t make much money per trip, you may want to be available during high-traffic events. For instance, if you live near a sporting event stadium, find out when the next game or concert will happen. Then, be sure you’re ready to provide transportation during the hours before and after the event.

Over time, you’ll learn more customer service secrets to increase your reviews and get more rides. Case in point: You could increase your tips if you offer special, unexpected items. These could include access to phone chargers, small bottles of water, or even facial tissues. The more thought you put into making your rideshare experience stand out, the better.

2. Transporting People’s Treasured Belongings

Let’s say that you like the idea of a ridesharing side hustle. The problem is that you would rather not ferry people around. Are you open instead to transporting people’s belongings or pets? Then you’ll want to check out a site like CitizenShipper.

What makes CitizenShipper’s model a little different is that drivers don’t give people rides. Instead, they give pets, and precious items rides. In fact, CitizenShipper has become known as a premier pet transport platform among breeders and pet parents alike.

Be aware, though, that you’ll have to go the extra mile (pun intended) to become a pet driver. All pet drivers must pass a background check, verify their ID and obtain a USDA registration. CitizenShipper makes this all quick and easy on their platform, and there is no cost to the driver.

Rather just haul packages, motorcycles, and the occasional piece of heavy equipment? Choose to be a regular driver instead. You’ll still get money to hit the open road. CitizenShipper drivers can make anywhere from $6000 to $10,000 per month, depending on the number of trips they make.

3. Making a Hobby Pay Off

During the pandemic, one report suggests that nearly six out of 10 people picked up a hobby. That’s not surprising, given the fact that plenty of folks had more time on their hands. So what better time to learn to crochet or pick up a crafty pastime?

Why not make your hobby pay off by turning it into a side hustle? It doesn’t take much to open your own Etsy store and start selling merchandise. It’s hard to estimate how much money you’ll make since it depends on the specific products you’re selling and the demand for them. Some can quit their jobs and make it a full-time gig, while others make a few hundred bucks per month.

Before you decide to just put pictures of your items online, do a little nudging around. See what other Etsy dealers and shops are selling. Is there something similar to what you’re planning to offer? What are the price ranges? How is shipping set up? You want to remain competitive and not be too far under or above the “going rate” of whatever you offer.

4. Selling Your Unwanted Stuff

Clutter, clutter everywhere. It’s such a common problem. Forty-seven percent of people in one survey admitted they had a junky room that they kept off-limits to special guests. Consequently, if you’re among them, you probably have a similar love-hate relationship with stuff. On the one hand, it’s nice to have things. But, on the other hand, those things can drive you crazy if you don’t use them.

Instead of letting your unwanted stuff collect dust, trade it in on eBay, Poshmark, or a similar site. To help you learn what’s hot among buyers, eBay has a trending page. Spending a little time on it can help you determine what you want to get rid of—and for how much. Don’t expect to fetch high prices on everything you own. However, be open to selling things currently in high demand. (Tech consistently does well and can bring in surprisingly high bids.)

If your closets are choked with apparel, you’re never going to wear, head to Poshmark. The company has set itself up as having nicer things. So make sure you’re very open if something is a little worn or has a hidden flaw. Then, with the money you take in, you can buy snazzy new duds to enjoy 2023 in style.

5. Starting a Blog

Does it seem as if your friends always come to you for advice? Would you consider yourself an expert on a niche topic, like tree identification or mid-century modern lamps? Starting a WordPress blog could be a smart move. According to Indeed, bloggers make an average of $39,186 per year.

Full disclosure: successful blogs take time to develop and drive followings. But if you can build a community, you can start getting advertisers. Each time one of your visitors clicks on an advertisement, you’ll get paid. It won’t be a ton per click. Nevertheless, clicks do add up.

Not sure you’re the writing type? A podcast or YouTube video channel could be an excellent way to showcase your mad skills. Just make sure that you have a plan to share valuable insider tips. No one will stick around to read your blog or listen to your podcast if you’re not unique. On the other hand, if you serve a narrow market, you could position yourself as one of the market’s most influential voices.

6. Live Streaming Your Gaming Experiences

Whether or not you’re a Twitch fan, you can’t deny that the platform has made live streaming huge. So if you’re into live streaming, you could set up a subscriber base and get paid regularly.

Unsure if people will really pay to hear your game or shop (which is significant outside of North America)? You might be surprised. Twitch has impressively high traffic counts. According to Statista, more than 5.6 billion hours were watched on Twitch in 2022 alone. That’s more than YouTube gaming numbers from the same period.

As with blogging, you can get money for live streaming from advertisers and not just followers. You still need a “hook” or a niche. You should also use social media to your advantage. Be sure to set up a social media page with your live-streaming link. It’ll give you another organic way to connect with people and grow your viewership.

7. Becoming a Tutor

A great way to master any skill is to teach it to others. Even some of the greatest minds in the world, like Michangelo and Mozart, shared their knowledge with others. As a side hustle, you can also become a tutor, training others in what you already understand.

Not long ago, tutoring had to be done in person. Now, though, Zoom has opened the door to allow just about anyone to tutor from anywhere. So, for instance, you could tutor someone worldwide as long as you both have a working Internet. The only limits are the ones you put on yourself as far as time goes.

What should you tutor? Music, wealth management, academic studies, sports, performance techniques, writing… whatever you excel at. You might want to work with an existing tutoring company to get started.

Tutors are especially needed for children from other countries who are trying to learn English. You’ll expand their know-how by helping them communicate better with people like you. And you’ll get paid in the process. Payscale estimates the average hourly wage for a tutor is $19.27, although this depends on how specialized your expertise is.

8. Renting Storage Space in Your Home

Storage units can cost a pretty penny. Move estimates that the average per-unit cost is around $180 monthly. That’s more than $2,000 a year. It’s also why you might want to ask yourself if you could store other people’s stuff in your house.

To be sure, this isn’t a side hustle for everyone. You need to have enough room in a safe, clean area to take this plunge. Still, you could be monetizing that space if you have a lot of useless space. Store at My House is a portal that makes it easy for you to connect with people.

Unfortunately, it’s only for users in the Los Angeles area for now. However, don’t let that deter you from looking for other avenues to offer your storage services, such as Craigslist. Even word-of-mouth advertising could be a good fit.

The key to making this work is ensuring you can protect someone else’s things. You may want to invest in gadgets like a self-installed security system or portable dehumidifier. That way, you can assure anyone needing temporary storage that you take your role seriously.

Money doesn’t grow on trees, it’s true. Yet it’s not as hard to put more dollars in your pocket as you might assume. With a little creativity and effort, you can set up a side hustle that lets you get closer to your financial goals.

The post 8 Easy Side Hustles in 2023 appeared first on Due.