Lessons Learnt From “Broke Millennial”

It’s a good read. Erin Lowry, a millennial and founder of BrokeMillennial.com teaches her peers how to take control of their finances. Her manual is both comprehensive and occasionally quite funny. Although some might argue that it’s excellent albeit quite basic financial counsel.

As per the above info-graphic suggest, the lessons are quite useful. Here’s a list of them, which we’ll discuss in detail later on.

  • Most important take away for everybody. Take control of your finances by examining your feelings toward money, saving and making a budget.
  • Put money aside in an emergency fund equal to three to six months of living expenses. Six to nine months if you’re self employed.
  • If you’re carrying debt, your debt-to-income ratio should not exceed 43% of your gross monthly income. If it’s currently higher than that, work hard to cut those gearing ratio down.
  • “Pay yourself first” by automatically routing a fixed amount or percentage out of your paycheck into your savings account.
  • Pay the full balance on your credit card every month. Alternatively, make sure to never spent money you don’t have.
  • Know your credit score and understand your credit report.
  • You can use the “debt avalanche” or “debt snowball” strategy for paying your debts. I used debt snowball for quite sometime to get rid of my own debts.
  • Save money for your retirement. Take advantage of employer contributions and matches.
  • If you switch jobs, don’t cash out your 401(k). Roll it over into your new employer’s plan or into an Individual Retirement Account.

We must take a few crucial steps to take control of our finances. That is to make a budget, create an emergency funds, work with the right bank, know and nurture our credit score, use our credit card wisely, and buying or renting a home.

Oh yes, prepare for your retirement.

Making a budget

I believe I’ve written quite a lot on budgeting. But this book approach this at a different angle. A much more systemic one. Which I find to be very interesting.

  1. The cash diet – Pay in cash. Emotionally it offers different ‘pains’ when you see your cash depleting compared to swiping your credit cards. Lowry suggest that we withdraw a set amount each month/week and don’t spend more than that sum. And add $100 per month for unexpected expenses.
  2. Track every penny – She suggest writing down every cent you spend. Which by then you would detect purchasing pattern and how much you spent on everything. Personally, I’m using ‘Money Manager’ app to track my spending.
  3. The envelope system – I never used this method. But I’ve seen enough of it to be certain that it works. Separate your money into different envelopes for each category – rent or mortgage, utilities, transportation, food, and more. Use either physical or digital envelopes. Don’t spend more on anything than you allocate for it.
  4. Percentage budgeting – Set 3 categories: Fixed cost (50%), financial goals (20%) and flexible spending (wants)(30%).
  5. Zero-sum budgeting – Know your income, and list your fixed costs and lifestyle expenses to find discretionary money. 

Create an Emergency Fund

Create an emergency fund that is equal to three to six months of living expenses. Self-employed people should save the equivalent of six to nine months.

Debt-to-income ratio (DTI)

Figure out “the percentage of debt you owe relative to the amount you’re earning.” Divide your monthly debt payments by your gross monthly income. Monthly debt payments (include student or car loans, rent or mortgage, credit card payments, utilities and other monthly bills) and gross monthly income is what you earn before deductions.

You don’t want DTI to exceed 43% of your gross monthly income. Anything over 43% makes you less likely to qualify for loans and more likely to default on existing debt. Build up your savings account by earning more and/or spending less. “Pay yourself first” by automatically routing a fixed amount or percentage from your paycheck to your savings account.

Dave Ramsey would suggest to drastically increase our income.

Monitor Your Credit

Five factors determine your credit score. Your payment history makes up 35% of your credit score, while the amounts you owe constitute 30%. The length of your credit history counts for 15%, your credit mix for 10% and any new credit you’ve applied for is 10%. Your credit score does not consider your race, age, sex, religion, salary, employer or occupation.

Beware of Credit Cards

The primary rule is to pay your full balance each month on time. Interest rates on credit cards can be 20% or higher. Some of them also have a penalty clause, which means if you’re late or miss a payment, your interest rate soars even higher. The “minimum due” line on your credit card bill is usually in boldface type or is highlighted, as a way to lure you into paying the lowest amount possible and thus paying more in interest. You should always pay off your balance on time and in full.

Again, PAY YOUR FULL BALANCE.

Dealing with Debt

Apply the “debt avalanche” or the “debt snowball.

To use the debt avalanche, write down all of your debts in order based on interest rate, from the highest to the lowest. 

To use the debt snowball strategy, list your debts, from the smallest to the largest balance, and ignore the APR. Pay the minimums due on all debt and put extra money toward the smallest balance first. After you pay that off, move to the next smallest balance, and so on.

Avoid future debt by putting money away now. List your monthly expenses. Subtract them from your monthly net pay. Is the number positive? If not, curb your spending by cooking meals and making coffee at home, cancelling gym memberships, and the like. Some even called this kind of ‘unnecessary’ expenses as the ‘latte factor’ which the credited reason why most people are broke.

Buying / Renting a House

Renting gets a bad rap as “throwing away your money,” but in some situations, you should rent instead of buying. Consider renting if you can’t afford to purchase a house where you live now, if you plan to move soon, if you have career opportunities in a high-priced housing market or if your career requires you to move quickly.

Meanwhile, owning a home can help you build equity. Figure out how much house you can afford to buy. You shouldn’t pay more than 28% of your gross income on housing, including principal, interest, taxes and insurance. Typically, purchasers put 10-20% down.

So, that’s that. It’s all the noteworthy materials in the book from my perspective. It’s not all inclusive but then again, buy the book. I would the book at 8/10 ⭐ .

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(Wealth) The Six Steps to Financial Independence

The world is filled with get-rich schemes and early retirement plans which promises a lot for very little. In this case, remember this, if it’s too good to be true, it’s probably is.

Here are the 6 steps to financial independence.

Step One: “Face the Facts”

True wealth is not about money, cars or mansions. Real wealth equals financial freedom, with liberation from boring jobs, bill collectors and lost sleep.

Financial freedom means you have sufficient funds and an automatic flow of “passive income” to pay for the nuts and bolts of life (food, home, entertainment, education) and for retirement.

“Passive income” is money you earn from real estate, bonds, equities, business ventures, royalties and other investments. It’s called “passive income” because you don’t have to clock in traditional nine-to-five hours to earn money.

This kind of income is the key to wealth and a comfortable retirement.

Begin with a savings plan.

A strategy for saving money provides the launch pad for your wealth-building journey.

The formula is simple: Spend less than your paycheck.

Too often people waste extra income on frills and toys. They may make you feel posh momentarily, but they sap your bank account. Remember this, even if you can pay the monthly payment, doesn’t mean you can afford it. Only buy if you can pay cash for it.

“Having enough money can liberate you from a thankless job, free you to follow dreams and allow you to take care of your loved ones.”

Calculate how much money you need for retirement; tally your costs of shelter, food, utilities, entertainment, travel, taxes and other nuts-and-bolts items.

Your goal is to accumulate a net worth of 10 to 13 times more than the amount you need each year, depending on what you believe your investments will earn.

“If you think that you’ll live another 30 years and believe the market will average a mere 8% ROI, you’ll need a multiple of 13 to consider yourself comfortably well off.”

“You can’t wish yourself to wealth, you have to plan for it…one detail at a time.”

Step Two: “Plan to become Wealthy”

Launch your plans now. Dedicate an hour a day to a new venture or a money-generating idea that will create a steady stream of passive or extra income. Establish concrete financial and personal goals for your family, your career and even your social life.

Effective goals include your core values, personal dreams of achievement, relationships, health and finances.

Create a timeline by establishing annual, “medium-term” and longer-term goals.

For example:

  • Annual goals : Get a $15,000 salary hike; launch (for example) an Internet-based plumbing supply operation; develop more industry contacts in that business.
  • Seven-year target : Generate pre-tax income of $125,000 through a combination of rental property (income of $50,000), bonds/stocks (income stream of $35,000) and an equity stake in a business ($35,000 annually).

Divide each annual objective into 12 goals. Create weekly and daily targets. The recommended schedule for planning includes this dedicated time:

  • The yearly map – One complete day of planning each year.
  • The monthly agenda – A couple of hours of planning every four weeks.
  • The weekly planner – A 60-minute planning session every seven days.
  • The daily strategy – Plan 10 to 15 minutes daily, preferably in the early morning.

Step Three: “Develop Specific Wealthy Habits”

Amass a financial base by acquiring the habits of the wealthy.

The “Eight Habits of Highly Successful Wealth Builders” are:

  1. “Work hard” – The typical millionaire clocks in about 59 hours of work per week. The agenda is usually challenging, but the time speeds by because many hard-working, successful millionaires enjoy their work.
  2. Build strong skills – Wealth generators are accomplished in their fields. Their mastery of business skills gives them the poise and confidence to tackle new opportunities.
  3. Develop several sources of income – Diversified income streams build wealth. Some of the wealthiest individuals have more than 12 income sources.
  4. Buy a “relatively” modest house – Wealthy consumers typically live in relatively inexpensive homes. Average Americans with a net worth of $6.8 million paid $545,000 for their homes. Lower home prices translate into less expensive taxes, maintenance, utilities and other costs.
  5. Spend moderately – Wealth builders hold down spending even as their earnings continue to grow.
  6. Save your money – Save much more than you spend. Avoid costly lunches, trendy new clothes and the wasteful accumulation of junk.
  7. Pay the home team first – Set aside your savings before you pay bills.
  8. Count your dollars – Effective wealth generators take frequent and periodic inventory of their income, assets and possessions, and calculate monthly financial statements.

“The more money you have, the more choices you have.”

Forget about a budget; budgets are like trendy diets with an endless cycle of deprivation and over-indulgence.

To reduce expenses, “pay yourself first,” by regularly stashing a pre-set amount of your salary into savings.

“You are not going to get rich by saving 10% of your income every month.”

Keep your savings plan simple. Establish a renewable annual contract with yourself promising to save more this year than last year.

Begin now.

“To get your financial fortune started, you have to radically boost your income.”

Step Four: “Radically Increase Your Income”

The path to wealth requires a six-figure salary.

Choose among several routes to boost your income, including one or more of these revenue generators:

  1. a dramatic merit-driven raise from your current employer;
  2. freelance consulting;
  3. launching a part-time second business; and
  4. investing in income-generating property.

“The purpose of spending less is to have more.”

Don’t expect to get rich through standard raises. Over the past 10 years, salary increases have dropped sharply; they hit record lows in 2003. On an inflation-adjusted basis, total annual wages actually dropped from 2000 to 2002. It’s still possible to earn “above-average” raises and bonuses, but to do so you have to produce “above-average” results. Become an “invaluable” performer and quietly broadcast your results.

Arrive earlier, work efficiently, be a team player, assist your boss and document your performance.

“Your home isn’t meant to be an investment. It’s a sanctuary.”

Shift your career goals.

Decide to meet the qualifications of the most lucrative positions in your company or industry. Update your skills to fill the demands of high-paid posts that start at $130,000 annually. Top-earning positions include management, technical jobs and profit-producing jobs inside companies.

“Profit producers” – employees who tap into new ways to cut corporate expenses or locate new pockets of revenue are especially valued because their labors have a direct impact on the bottom line.

“Be suspicious of stock stories. The stock brokerage and information businesses work on the basis of drama.”

Employ your other talents to launch a part-time venture, such as a consulting business, a direct-marketing company, or a sales and services firm.

The universe of potential product sales is broad and includes audio/video recordings, diet products, office/craft supplies and Internet-based publishing.

Flipping in and out of real estate is also a potential source of income.

The guidelines for successful transactions include:

  1. Buy property for fair or below-market prices;
  2. Target neighborhoods that you know;
  3. Calculate and compare square-foot costs; and
  4. Create a realistic investment plan based on your budget.

“It is how you act, not what you think, that will determine your success.”

Step Five: “Get Rich While You Sleep”

Sweet dreams!

It’s possible to accumulate a fortune even when you’re slumbering. That’s because equity investments – in a private business or on Wall Street – appreciate (or depreciate) on a continuous basis. But if you enter the stock market, step carefully. A variety of factors – revenue forecasts, “price-to-earnings ratios” and historical earning trends will affect the value of share prices.

Follow these rules to avoid getting burned:

  • Target familiarity – Invest in companies and industries you know and understand.
  • Be wary of fables – The investment world is full of myths, hot hypes and other forms of corporate deceptions.
  • Create a “Plan B” – Keep your options open. Hope for the best, but plan for a worst-case scenario. Use “Stop-Loss” techniques to limit your risk. A “Stop-Loss order” enforces your pre-planned price for selling a stock. Basically, when a share price falls to that pre-set value, your broker activates your standing order to sell it. With such a plan, you’re less likely to fall prey to dangerous market emotions or risky Vegas-style investing.
  • Diversify – Purchase a wide range of shares from companies with large and small market capital levels. Investments in corporate bonds, Treasury bills, gold, real estate and foreign stocks also provide diversity and hedges against risk.
  • Contain risk – Establish guidelines for your investments in single stocks and in the overall stock market. A conservative investment portfolio typically has 5% to 20% of its assets in stock; a risky portfolio could lodge more than 80% percent of its assets in the stock market.

“Start saving now, even if your income is small [because] you want to create the habit of saving. When saving becomes habitual, it becomes easier. And anything that you can do easily, you’ll do better.”

Similar rules apply for potential investments in small, privately-owned companies. Examine the customer retention and “customer acquisition” levels of the business you are considering. How much does it spend to create new customers? Examine its profit statements and long-term growth opportunities.

Apply those same benchmarks if you plan to start your own business. Use your own time for your business development activities; avoid using any of your current employer’s resources to launch it. Consider a “home-based” venture that taps into your existing knowledge, skills and contacts. Cultivate opportunities with lofty profit margins, growth potential and unique products or services.

Real estate is an investment that can pay for itself, with a few caveats. Consider this example: You purchase a property for $100,000, with a $10,000 down payment and about $2,000 in closing costs. If your property value spikes by 6.5% a year, then in 11 years, your compounded annual gain will be $12,200, earning far more each year than your initial down payment.

The investment looks even better if the property generates “net rents” or a profit from rent revenue after subtracting taxes, insurance and maintenance.

This strategy does not work if you overpay for the property or make some related mistake due to lack of familiarity with the local rental market.

Learn the territory.

Step Six: “Retire Early”

This strategy yields early retirement, within seven to 15 years, or sooner. A “side business” is likely to generate a surplus of capital. Your part-time business ventures can produce annual returns of 20% and can go as high as 100%. Likewise, prudent property investments can yield up to 25% annually. What’s more, real estate and “side businesses” represent less risk than the stock market. Regardless of your investment path, follow these four basic signposts:

  1. The $25,000 net-worth threshold – Avoid stocks and bonds at this level. Be an aggressive saver; improve your employment value and invest in a small piece of residential real estate. Launch a business that does not require huge capital investments. (Forget restaurants or pharmaceuticals.) Consider developing a hobby into a lucrative opportunity. Sell supplies or services that you know well.
  2. Net worth of $25,000 to $100,000 – Keep emergency cash on hand. Invest in revenue-producing real estate. In the short term, buy, renovate and resell; for the long term, buy income rental properties. Purchase a $10,000 stake in a small business. Or use that sum to create your own venture. Invest in municipal bonds, Treasury bills or top-quality corporate bonds.
  3. Net worth of more than $100,000, but not quite independent – Reserve easy access emergency funds for three to six months of living expenses. Buy a small emergency stash of gold and a collection of hard assets: art, furniture, books, coins and dolls. Invest in equity-generating real estate, part-time businesses, stocks and bonds.

Financial independence – You are fiscally independent if your balance sheet totals a minimum “of 10 times the amount” of after-tax income you need. At this stage, aim for a diversified mix of stocks/equity funds, bonds, real estate, fun money and emergency gold and cash.


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(Wealth) 7 Steps to Wealth

Seven Steps to “Jump-Start” Your Wealth

The following steps enable you to increase your wealth and decrease your tax liability by taking advantage of legal loopholes in the tax laws (for USA Citizen, might be applicable to other countries as well):

  1. “Create a business” – An individual employee earns a paycheck. His or her employer deducts taxes; and finally, the employee can spend whatever’s left. However, business owners follow these steps in a different order: their business earns income; they spend money, which they can deduct from their taxes as business expenses; and, finally, they pay their taxes. Of course, you must structure your business correctly, have a source of funding and an exit strategy, and run the business responsibly.
  2. “Discover your hidden business deductions” – When you own a business, you can deduct many personal expenses from your business income. These include certain costs for your car, bad debt, business start-up, education, entertainment, professional fees, travel, interest, moving, equipment, charitable contributions and taxes.
  3. “Pay your taxes” – You have more control over your timing when you pay business taxes than you do when you pay personal ones. Ideally, pay your business taxes at the last minute, so you don’t incur a penalty for late payment but you also do not lend the government your money.
  4. “What’s left goes into real estate” – Because some kinds of real estate appreciate so quickly, “the more you can put into real estate…the faster your income will grow.”
  5. “Real-estate income comes out tax-free” – By finding a balance between depreciation and income from your property, you can manage not to pay any tax on it.
  6. “Buy a house the right way” – Although a home is a necessity, it is not necessarily a source of income. However, you can reduce your housing expenses by buying strategically – for example, by moving into a neighborhood where prices are rising.
  7. “Make your home give you money” – Tax loopholes allow a homeowner who has lived in a home for two years to sell it without paying capital gains taxes. Other loopholes apply depending on how long you have lived in your house.

“The wrong business structure can be expensive to unwind and can actually cost you extra taxes.”

The jump-start system works because it is flexible: it enables you to leverage various sorts of assets, gives you access to business and other tax loopholes, and provides you with several different income streams.


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(Wealth) STEPS of Financial Independence

The STEPS Cycle of Financial Independence

Using the STEPS cycle of financial planning can help you become more aware of your financial assets and increase your wealth.

It consists of the following stages: “Starting point,” make a thorough inventory of your financial position; “Team,” form a group of trustworthy advisers; “Evaluation,” map the path to your goals; “Plan,” create your tactics; and finally, a return to the “Starting point” for a progress report and re-evaluation.

Yes, this is a much more formal kind of financial planning for financial independence.

Step One: Calculating Your Starting Point

This is basically where your fiscal standing currently are.

To determine your fiscal position, use financial statements that clearly outline your monetary flows and net worth.

Together, the following three kinds of statements will give you a comprehensive picture of your budgetary position:

  1. “Income statement” – Lists income and expenses. The statement includes three kinds of income: earned income, portfolio income and passive income. Earned income is the money you receive in exchange for your labor, time or services – in other words, your pay. Earned income is taxed at the highest rate, which is sometimes more than 40%, depending on how much you earn. Portfolio income is the money you make from interest, capital gains and dividends – “the money your money makes for you.” Passive income is the money you make from investments, such as real estate. With proper tax management you can pay no tax whatsoever on passive income.
  2. “Balance sheet” – Shows your liabilities, assets and net worth. While the income statement shows your progress over a period of time, the balance sheet is a snapshot of the moment. When you draw up a balance sheet, avoid these five common mistakes: overstating asset values; counting illiquid assets (those you can’t convert into cash right away, such as your home); ignoring liabilities; counting possessions that do not build wealth; and failing to differentiate between “good debt,” which finances an appreciating asset, and “bad debt,” which finances a depreciating one.
  3. “Statement of cash flows” – Shows your actual cash position, independent of your income and balance sheet positions. The income statement and the balance sheet depend on accounting conventions and technicalities, and your net income is not the same thing as cash. For example, passive income may not be cash income. In the final analysis, “cash is king.” Small businesses and individuals rarely prepare cash flow statements – a serious omission.

“The plan of your parents – work hard, save your money and collect your retirement – was effective for them, but it doesn’t work now.”

You need discipline, even courage, to prepare a frank, honest set of financial statements and to look dispassionately at your financial position.

Step Two: Forming a Team of Advisers

Be careful about whose advice you seek. Friends and acquaintances may discourage you from taking actions that will result in your financial independence.

Like crabs in a box, people often pull each other down.

They can’t see why you would do something different from what they are doing. Do not listen to naysayers or others who insist that you’ll never achieve your financial goals.

“The biggest expenses for the average citizen are interest and taxes. Both of these expenses put your money in someone else’s pocket.”

Instead, assemble a team of knowledgeable advisers whom you trust. Depending on your business, they may include specialists in insurance, accounting, corporate structure, law or finance.

Cast a wide net.

Ask other business owners for advice, ask advisers whom you already trust to recommend advisers in other areas, and check with local licensing and certification boards. In this technology-enabled age, you can work with advisers who are geographically remote and stay in close touch with them through e-mail or fax.

Keep the following points in mind when you work with your team:

  • Trust the trustworthy – If you have picked a good group of advisers, do the logical thing and allow them to do their jobs.
  • Learn the language – Lawyers and accountants speak a technical language in which words have very specific meanings. Learn their jargon so you can make sense of the advice they give you.
  • Ask the right questions – Ask your advisers about your actual situation. Don’t ask hypothetical questions and don’t ask questions that are so specific that they limit the answers. Ask people questions in their area of expertise. That means ask your attorney legal questions, ask your accountant accounting questions, and so on.
  • Keep your advisers informed – Give them the information they request. When your advisers ask you questions, your job is to answer them.
  • Clean up after yourself – When you make a mistake, don’t point the finger or make excuses. Accept responsibility.

Step Three: Evaluating Your Strategy

Your most important sources of tax loopholes are:

  1. Business – Starting a business can reduce the amount of tax you pay – but because some people have used “sham businesses” to create losses they can offset against earned income from other sources, the U.S. Internal Revenue Service (IRS) has a fairly strict definition of “business.” You must have the appropriate experience; operate in a businesslike manner, with a bank account, records and filing systems; document reasonable losses; and, at some point, make a profit. The appropriate business structure can minimize your taxes. For example, a corporation, which limits liabilities and offers tax advantages, is often preferable to a sole proprietorship. Meet your business tax obligations on time, because penalties are costly and the IRS has enforcement powers that other creditors lack.
  2. Real estate – Investing in real estate has numerous tax advantages, particularly because you are allowed to use depreciation to offset the income you receive from a property. Depreciation is a “phantom expense” that does not cost you actual cash.
  3. Home – If you want your home to provide you with a tax advantage, you must structure the purchase properly. Protect your home equity by using the homestead exemption, hold your home in a limited liability company and use debt strategically.

“Free advice may be the most expensive advice you ever get.”

Step Four: Following Your Path

The most important part of having a plan is implementing it. Your particular plan and implementation will depend on your circumstances.

No matter what plan you follow or what actions you take, prioritize keeping good business records in these three categories:

  • “Temporary files” – Records of annual income and expense items. When you pay an invoice, record the date, check number and amount. Accountants call these records “temporary” because they apply only to a particular tax year. But “temporary” does not mean “discard.” Keep temporary records for at least five years, and as many as 10, if you are at risk of lawsuits.
  • “Permanent files” – These document your business’s assets, property, debts and structure. Keep these records in good order; if the IRS audits you, your ability to produce them quickly will show that you have run your business responsibly.
  • “Financial statement files” – Many business owners use programs such as Quickbooks to generate financial statements.

“Always avoid standard advice. People are different and circumstances are different. Don’t get caught when someone just assumes you are average.”

Step Five: Re-evaluating Your Starting Point

Periodically revisit your strategy to check its status and progress.

Touch base with your advisers at least quarterly or even more frequently, depending on the nature of your business. Even if meeting with them costs you money, the meetings will help you make more in the end than you will spend on your advisers’ fees.

Make prompt adjustments to your strategy, plan and actions when circumstances warrant.

“The best advisers know what they need to know…They should ask you more questions than you ask them.”

Keep track of what works and what doesn’t. Because feeling assured and strong can help you succeed, emphasize your “wins.” Write down “five things that you did that worked” each day. Share your wins with someone close to you, such as your spouse, an adult child or a friend.

“The best plans in the world don’t mean a thing if you never implement them.”


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(Budgeting Method) Zero-based budget: A quick guide

Zero-based budget I believe is the most productive budgeting method.

How does Zero-Based Budget Works?

Dave Ramsey, is arguably the most famous champion of the zero-based budget. Simply the most simple, straightforward and actually makes every dollar you earned accountable.

The first step, like in most budgeting method, is to tract exactly what you earn each month and start saving until you have one month’s worth of income saved for emergency.

Example.

Your Income : $ 5, 000

Your Bills: (Example)

Rent$ 1,000
Utilities$ 200
Phones$ 200
Internet$ 150
TV / Netflix$ 50
Insurance$ 250
Car Loan$ 950
Groceries $ 250
Personal Loans$ 500
Credit Cards$1,000
Total$ 4,550

So, basically you only have $450 ( $5,000 – $4,550).

What to do with the extra $450?

Now, you can put that money up for saving up your initial $1,000 emergency funds.

After that, the $450 can go into paying off your debts. Pick one with the lowest balance and pay it off first.

This will give you the a sweet taste of small victories.

Continue on this route until you paid off all (if not all, majority of your debts).

Recommendation

Try to cut some of your expenses, making the extra money which can go into your step of paying off debts.

I personally prefer this zero-based budget. But as my personal finance improves, I switch to the 50/20/30 Rule.

But still doing budgeting.


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(Blogging) Financial Freedom

“Successful businesses aren’t just ideas that sound great; they fill a void or solve problems that people deal with on a regular basis.”

Financial Freedom

Author Crystal Paine, founder of the popular MoneySavingMom.com blog – and her husband Jesse were able to move from their hometown of Nashville, Tennessee, to Wichita, Kansas, because they earned the financial freedom to make the change.

They spent many years watching their pennies, staying out of debt and working several jobs to achieve that goal. The phrase “financial freedom” means different things to different people. Paine interprets it as having more than enough money to cover her monthly bills and provide for her family.

Other people define financial freedom as having money saved or invested, reducing debt or amassing enough savings to send their children to college or retire comfortably.

Every definition of financial freedom includes making more than a survival income and gaining the luxury of being “intentional” with your money.

You don’t have to be a superwoman, work from sunup to sundown or make boatloads of money to gain financial freedom. Regardless of your family situation, age or education, you can achieve your hopes and dreams if you have an open mind, work hard and persevere.

“Successful businesses aren’t just ideas that sound great; they fill a void or solve problems that people deal with on a regular basis.”


If you’re interested in starting to make money online or even starting a blog. Please read How to start a Blog.

“Start testing immediately. A little bit of something is better than a whole lot of nothing.”