Episode 404: How Are Your Resolutions?

June 9, 2016

So yesterday I mentioned a budget and I immediately got a question about how to go about setting up a budget. Well, there are lots of methods you can use but the one I think that makes the most sense for many people is to track your expenses for a month or two and then build your budget based on what you find.

So what does this involve? Basically, it involves using an app on your phone or carrying a notebook of some type and writing down everything that you purchase. This includes everything from groceries to the coke you get out of the machine at work. Hey little things can add up and if you don’t include them in your budget you’ll find yourself at the end of the month wondering where your money went.

Once you have a good idea of where your money is going the next step is to break it down into categories – so much for rent/mortgage, food, entertainment, transportation, etc.  Next, add up all the money that comes in each month and subtract your total expenses. If you have money leftover that’s great. However, if you come up short, you will need to go back and rework your budget until you at least breakeven.

Designing a budget is not difficult, what is difficult sometimes is sticking to it – so think about what your motivation is to have one. If you have real goals you want to accomplish, buying a home, retiring etc. these can be pretty powerful motivating factors and don’t forget about just plain old dumping money stress cuz you got your bills and your future covered.

And, that’s the minute for today. I love helping people with all aspects of their financial lives. If you have a question, send it to me at info@mindingyourmoneyminute.com.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

 

Episode 403: How Does Your Cash Flow?

June 8, 2016

Today let’s talk cash flow. I know I talk a lot about it on the business side, but it is just as important for individuals to have a positive cash flow. Cash flow is the difference or what’s left over each month after you pay your bills. On the personal side this is call discretionary income. However, the thing that happens most, especially if you don’t have a budget or a spending plan to direct your money is that there is typically nothing left over.

There’s a quote by Warren Buffet that goes like this: Rule #1 don’t lose money. Rule #2 Never forget rule #1. And I want to put a little spin on that. Rule #1: Don’t run out of money and rule #2, never forget rule #1.

To solve the more month than money dilemma, create a budget or if you don’t want to do that create a series of buckets for your money so that you can direct into the places that you want it to go.

For example, you set aside 50 to 60 percent for housing. Another 10 percent might be spent on food, etc. The key is to allocate a portion of the money for your savings or investments and don’t forget to add some fun money to enjoy. It’s basically impossible to develop a plan that will work long term if you don’t allow for fun.

And, that’s the minute for today. I love helping people with all aspects of their financial lives. If you have a question, send it to me at info@mindingyourmoneyminute.com.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

 

Episode 402: Are Mutual Funds Dead?

June 7, 2016

I recently read an article that questioned the future of mutual funds. It seems that ETFs or electronic traded funds are taking over and there are some good reasons that so many people are making the shift.

First, the expense ratios of ETFs are generally lower versus active mutual funds and in some cases, even lower than index mutual funds. Also, ETFs often have lower trading costs versus actively managed funds, due to their low portfolio turnover. The ETF cost savings can be significant, especially for long-term investors.

Second, transparency – Actively managed mutual funds report their holdings on a quarterly or semiannual basis, whereas exchange-traded funds disclose their portfolio holdings on a daily basis.

And, third ETFs are renowned for having low portfolio turnover, which is good for investors, because it reduces the possibility of tax gain distributions.

The only problem some 401(k)s and other qualified plans may not have made them available as yet. But if you do some investing on your own, you might want to look into ETFs – it could save you a lot of money!

And that’s the minute for today. I love helping people with all aspects of their financial lives. If you have a question, send it to me at info@mindingyourmoneyminute.com.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

 

Episode 401: What’s in Your Emergency Fund?

June 6, 2016

It’s Monday and I have a question. Is your money working for you?

Well, I’ll get right to the point. What’s in your emergency fund? An emergency fund (cash cushion, cash reserves) whatever you call it is an account you have to bail you out if something unexpected happens – your car breaks down, you get sick and can’t work, you lose your job – you get my drift. So how much do you have packed away?

If the answer is nothing or you aren’t sure, now is the time to replenish it or start one.

To quote Denis Waitley, “ We should Expect the best, plan for the worst, and prepare to be surprised.” But I’m not a fan of surprises that put me in a financial bind and that’s why having an emergency fun is so important. So how much should you keep in your emergency fund – well it depends.

How does it cost to repair your car? Pay your expenses for a month or two or three? And so on. So start by thinking about how much you need to have on hand. $5,000, $10,000 or more to tide you over. And if that is way too much start where you can start and add to it every time you get paid until you build up a comfortable amount. Then as you use it don’t forget to put the money back. And here’s the key, don’t keep the money in your regular checking account, set up a special account to there will be less temptation to use it for non-emergencies.

And, that’s the minute for today. I love helping people with all aspects of their financial lives. If you have a question, send it to me at info@mindingyourmoneyminute.com.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

 

Episode 400: Word of the Week: Financial IQ

June 3, 2016

It’s Friday and time for the Word of the Week! Our word this week is financial IQ.

I chose financial IQ because I was recently quoted in Essence Magazine and the topic was why you need a financial planner. As women and men too, we have a tendency to believe that managing your money is a bit of a no-brainer – that anyone can do  — that we are born with that knowledge.

It’s true that some people do have an affinity for it and they but a lot of people don’t and they struggle often in silence because they don’t want anyone to know what they don’t know.

The good news is that unlike your mental IQ, you can increase financial IQ and your can do so with just a little education and practice. So where’s a good place to get that education? Well, start where you feel comfortable, read a book like Minding Your Money, attend a seminar or webinar, talk to your money savvy friends and talk to a financial planner. Then put what you learn into practice. Once you start to implement some of the things you learn, you will quickly find out what information you’re missing. Educating yourself about money is really an ongoing process because things are always changing.

Our word of the week financial IQ. Your financial IQ to date is the result of all of the things you have learned up to this point. If you don’t like where you are, change it! There are so many resources available that there are no longer any excuses – and if you have money smarts – don’t keep it to yourself — share your wealth of knowledge and that will make you even smarter!

And, that’s the minute for today. I love helping people with all aspects of their financial lives. If you have a question, send it to me at info@mindingyourmoneyminute.com.

Thanks for listening and as always remember that minding your money really is the path to a richer life!

Making Cents of Online Investment Services – Which is Best?

October 7, 2015

The question of the day is all about using online investment services. In other words; Should You or Shouldn’t You? Naturally, as you might well expect with this sort of question, there is no one size fits all answer here. You see, for some people, using an online investment service is a no-brainer, whereas for other people not so much.

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Ease Your Way In To The Stock Market

October 7, 2015

Heads up, you know darned well that you have to do something with your money. Something besides enjoying your weekends and getting your hands on the latest electronic gadget. That something, as you have probably already figured out is about getting up close and personal with the world of investments.

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True or False? — It Takes Money to Make Money

October 7, 2015

The short answer is YES; of course it takes money to make money. To make money in the stock market, you must have money to make the initial stock purchases. Starting a business requires money to buy inventory, marketing materials, office space and equipment. Even lottery winners had to have the seed money required to buy the ticket. The only exceptions that come to mind are inheriting, stealing or finding money.

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Wealth Building Tips for Millennials

October 7, 2015

Millennial! Another of those media driven buzzwords, used to label those between the ages of 18 and 34, while the term Gen Xers define those between 35 and 50 years of age. Boomers, the group to which I belong, are those 51 through 69. This post covers 8 key pieces of advice I proffer to this generation.

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Uncommon Wealth Building Wisdom – Trash The Benchmark

October 7, 2015

There is a common trait that shows up on the road to building your wealth. This trait shows up as you continue to add to your investment portfolio. You do have an investment portfolio don’t you? And don’t even start the blame game when this trait is revealed in just a moment.

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Top Budget Hacks for Planning and Accounting

October 7, 2015

Something most rags-to riches stories have in common is that a good budget is always needed to help anyone achieve financial security. If you want to significantly improve your credit, you have to learn how to pace your spending and increase your savings. No matter how much money you have, there will always be something you can spend it all on and become dead broke again.

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