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Financial Tips For 2018

If you are not paying yourself first, are you financially stable? Financial experts repeat themselves quite often on the first rule of personal finance. Pay yourself first. Depending on your budget you should be paying yourself 5-20% of your net income. What to do with all of that money? Anything you want. Most create an emergency fund, then vacation fund, investment fund, and finally a retirement fund. This may seem overwhelming, but it is quite simple after the first several months. Wealth is not acquired quickly, instead, it is done slowly, yet surely. These are just some of the laws of money. The article sourced was written by Tina Santiago-Rodriguez is included in this blog post for your convenience.

Family and finance: Financial experts give their tips for the New Year

Did you make any resolutions for this New Year? Or set any goals? It’s not too late to do so even if the first month of the year is about to end. This applies especially to your family’s finances.

On my blog, TrulyRichandBlessed.com, I always say that our finances are part of our “riches,” i.e. our blessings from the Lord, so we must be good stewards and manage our finances properly. Here are some tips from financial experts that will hopefully get you started on the right path:

Obey the ‘laws of money’

Author, speaker, and Philstar.com columnist Rose Fres Fausto advises us to usethe simple three “Basic laws of money.” “They’re so simple that even young kids can understand, remember, and practice them throughout the year,” she adds.

The “laws” are described in Fausto’s book, “The Retelling of The Richest Man in Babylon,” which can be purchased from major bookstores. These are as follows:

1. “Pay yourself first”

2. “Get only into a business that you understand; and seek advice only from competent people.”

3. “Make your gold work for you. Make an army of golden slaves before you buy luxury.”

Fausto says COL Financial Chairman Edward Lee phrases this in a different way: “1) Save 2) Invest 3) Reinvest.”

Many Filipinos don’t even know about these “laws,” especially the first one: “Pay yourself first,” which basically means that when we receive any income, we should set some aside for our savings first beforewe spend money on anything.

The first law of money: Pay yourself first. www.fqmom.com/Rose Fres Fausto

In our family, we strive to follow this formula: Income less Tithes and Savings = Expenses. This means that we set aside money for tithing (to the Lord via our parish and community) and savings, and whatever is left is what we use for our monthly needs (or expenses). We are not yet 100 percent consistent in doing this but we do our best every month.

Don’t wait

Mon Santiago, a financial literacy crusader and educator of the International Marketing Group or IMG’s Wealth Academy, always shares this bit of financial wisdom to individuals and families in the free financial literacy seminars that he conducts: “Don’t wait. Start to save and invest as much as you can, as soon as you can.”

Financial educator Mon Santiago always emphasizes the importance of saving and investing your income during his free financial literacy seminars. www.fantasticfinancialeducation.wordpress.com

Santiago (who also happens to be my dad!) adds, “Procrastination is the enemy of saving and building wealth. When many people are young, they think they have a lot of time to save. Then they get married, have kids, and buy a house. With a home loan and new expenses, money becomes tight. They tell themselves they will start saving later.

“As they enter mid-life, their children go to college, and tuition takes a big bite out of their budget. Soon they will join the majority of people approaching retirement with little to no savings. They know they must save, but now they say it’s too late.”

So start saving money now. Every single peso counts!

Share your blessings

As I mentioned earlier, our finances are part of our “riches” or blessings from God. So we are not just supposed to use our money for ourselves, but we are also meant to share it with others.

Allan Ngo, founder of the Truly Rich Club Blog, shares how he does this: he created an “automated charity fund.”

“We normally think of money in terms of accumulation, but one of the most powerful impact money can have is through generosity. That’s why I created a charity fund. It’s a separate bank account I set up to which I automatically transfer a certain percentage of the money in my main bank account every month.

“I personally use BPI’s Save-Up account. You can inquire with your own bank for such facilities.”

Ngo says the transfer is automated or automatically done by his bank every month for a purpose.

“Remember, we are taking hard-earned money away from our own personal use, and that can be painful. So making it automated takes that emotion away and enables continuity,” he explains.

“I use this [fund] to support my sponsored children from World Vision, donate to charities when calamities strike, and help out a friend or relative in need. Mentally, since I’ve already earmarked this for helping others, it enables me to quickly help others wholeheartedly. Personally, this fund has made a tremendous impact in my life, and I hope it does the same to you.”

I hope these finance tips will help you and your family to have a great year ahead financially. Remember, it’s not too late to put these tips into action, even if January is almost over—we still have 11 months to go before the next New Year rolls in!

thumbnail courtesy of philstar.com

Only you care about your finances. If you are not looking after it, who will? Personal finance is not difficult and is not very time-consuming. Where do you start? You need to start researching which financial book works best for your needs. A person who wants to pay off their debt quickly will read a different book than someone who wants to invest their money. It can be as simple as searching for “how to save money book”. You will probably come across a list of ten or hundreds of books to choose from. 99% of them will benefit you in some financial way. It can be as little as saving $10 a day by eating out less, debt consolidation, or paying yourself first. Research what works best for you and work on it. Enjoyed this article? Hopefully, you did. If so, let us know on social media about how much you’ve learned reading our articles daily.

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Excuses That Will Keep You From Becoming Wealthy

Are you wealthy? No? Well, why not? If you have a cliche answer like “Personal finance is confusing” or “I have too much debt”. Those excuses that everyone faces. No one is expecting to be a millionaire before 30, however, the average 30-year-old has an average net worth of $2,093 according to The College Investor. This may be caused by the cost of post-secondary, the price of Transportation, and the higher cost of housing.  The question you have been asking is probably “I’m tired of making excuses, what can I do?” The best options you have is to analyze the excuses and find solutions that best suits your situation.  Business Insiders have found the top 5 excuses that are holding you back from increasing your wealth. We, the employees at Loan Away, has cited the source article in our blog post for your convenience.

 5 all-too-common excuses that will keep you from building wealth

One of the most important numbers you should calculate and track consistently is your net-worth, which is your total assets (those things worth money like your house and any investments) and your total liabilities (what you owe money on like credit card, mortgages, and student loan debt).

Your net worth is how much money you would be worth if you paid off all of your debts: Assets – Liabilities = Net-Worth

Over time as your investments grow and you pay down your debt, you net-worth will go up. This is why it’s so essential to invest while paying back your students loans. Ever since I started my financial journey I’ve been tracking my net worth using free tools like Personal Capital.

Median net worth in the United States

Recently, a friend and I were discussing an interesting statistic from an article about net-worths. The statistic that we were talking about was was from an article in Business Insider from Jim Wang showcasing the average net worth for the different age groups of Americans.

Given that the average savings rate in the United States has fallen to a 7 year low at only 2.9%, it’s not really surprising, but incredibly disconcerting to see that the members of my age group (under 35) have a net worth of less than $6k.

The 35-44 age group isn’t much better with a net-worth of $35,000. That’s crazy considering

Average price for a car in the United States is a whopping $34,968

Average student loan debt is $34,144

Average credit card debt at $16,883

the higher cost of living

This is a recipe for disaster. All of these numbers paint a bleak picture of Americans and the hole is getting bigger to get out of. It also doesn’t get any prettier for just millennial net worths either based on a more detailed analysis on The College Investor:

The College Investor

My friend asked me why I thought more people in our age group are stuck at a certain net worth or why I thought it was hard for many to change their financial situations. Then he asked, “Was it that hard for you to change your situation?” In a simple answer: yes and no.

Top 5 money excuses holding you back

But after we had some back and forth text messages, I realized there are are a few common excuses people make about money that keeps them from saving and investing. These are the same money excuses that are keeping people from pursuing (and eventually achieving) financial independence.

Send this to any of your family or friends who are making excuses and need to start saving more money. All of our futures depend on it. Let’s get those net worths up!

Excuse #1: I don’t have time to budget and look at my personal finances

Oil Scarff/Getty Images

One of the main excuses I’ve heard among my friends, colleagues, and others is the same old excuse for most things: a lack of time. Sure, pretty much everyone has busy schedules whether it be school, work, family, kids, etc. A majority of people lead extremely busy lives.

Yet, I bet that majority also find time to binge watch Netflix for hours (Hey, me too!), play sports, watch sports, and go shopping, etc.

Americans watch an insane amount of television each week. The average millennial watches television 26 hours a week (3.7 hours a day) and older Americans (35-44) watch it 36 hours a week (5.14 hours a day).

And those things are all fine to do in moderation, but it’s fairly easy to take 20-30 minutes a month to devote to planning and managing your finances. Seriously that not much time. And it actually takes a lot less time than you think.

There are tons of free tools out there like Mint and Personal Capital. Use them.

Excuse #2: Personal finance is too confusing

This was the biggest excuse that personally held me back in my own financial journey. Thinking personal finance was confusing was one of my biggest money mistakes.

The biggest reason people think that personal finance is too complicated is for two primary reasons.

The financial industry is set up so personal finance seems complicated, with its acronyms and fine print, so that some finance companies can make more money and we aren’t taught much about money in school.

The challenge here is, unless you were in accounting or some financial track in school or college, Americans really are not taught a lot about personal finances in the education system. Although “money management” is one of the most requested classes by high school students in the United States and it looks like the trend is starting to shift a little bit.

A vast majority of personal finance you can learn online for free by reading blogs and listening to money podcasts. Or by reading the best money books.

Excuse #3: It’s too hard to get out of debt

Virginia State Parks/Flickr

Whether it’s student loan debt, car debt, credit card debt, personal debt, or mortgage debt, it feels like everyone is swimming in debt these days.

But paying off debt is really a numbers game — always pay down the highest rate interest rate first, then move onto the next one. In almost all cases credit card debt will have the highest interest rate and should be paid off first.

No matter how large your debt is, some people actually have over $1 million in student loans and they were able to pay them off. While I used to have a lot of debt, every year I’m surprised how much more debt I paid off when at first it only seemed like a minimal amount.

The sooner you start crushing it the sooner it will be gone. No one likes having debt, but you need to face it head on instead of the, “I’ll worry about it later.”

Excuse #4: I’ll worry about it later

This is the money excuse that bothers me the most.

I’m guilty of it. Too many of us put off our finances until later. The longer you wait to invest or to save or to pay down debt, the longer you will miss out on potential investment gains.

The first company I worked for after graduating college had a pretty solid 401k, but I knew very little and wasn’t too concerned. “I’ll worry about it later,” I’d say to myself.

All I knew at the time was having a 401k was good to do, so I did sign up, but I only contributed 2% when the company matched at 6%. D’oh! Facepalm. SMH.

Well, then after working at the company for four years, I was let go. During that entire time, I never increased my contribution rate once! I easily missed out on $50,000 — $100,000 in future potential investment gains by not increasing my 401k contribution rate.

Now, of course, I got to keep the money I did save, but I kick myself for not spending the time (man excuse #1 keeps creeping up) and just looking into it.

No matter what financial decision you are putting off making, make it today, like right now. Get it off your plate. As an added bonus, current neuroscience research shows that making decisions makes you happy.

Excuse #5: What if I lose money?

Sarah Jacobs

Who hasn’t heard this money excuse? Seriously.

In my opinion, far too many people think that investing is gambling. They worry that they are either going to win big or lose it all. They see stories like the 20-year-old Florida man who won $450 million in the Powerball lottery and think that’s the way to get rich. The odds of winning that Powerball was 1 in 262 million (aka pretty much impossible).

But in reality getting rich isn’t about betting everything or putting all your eggs in one basket, it’s about coming up with a good investing strategy and keeping at it for the long haul. And taking calculated risks.

The stock market is going to go up and down, but it’s always gone up over the long run. And you’re never going to lose all of your money in the stock market (we’ll if that does happen we will all have much bigger problems like the entire financial system collapsing).

In reality, the stock market will only go up and down a couple percentage points a day — on the worst day the stock market was down was 22.61% on October 19, 1987. Here are the biggest stock market gains and losses in a single day.

So if you invest in a total stock market index fund then that’s about the most money you could lose in one day — and that was the worst day ever! And when you invest in the stock market it should be for the long haul so sure you can lose money investing, but over the long haul, the stock market is always up.

Final thought: Never get too comfortable

Many of us, myself included, often get too comfortable with our money strategy once we get it humming. Maybe your finances aren’t that bad, you have a decent job, some debt, but generally everything is paid on time.

Yet, your saving rate stays stagnant and you do not see much growth year after year. As soon as you feel yourself being too comfortable, that is the time to recognize it and get ready for a change. The time to push the limits.

When it comes to time and saving money, there are plenty of unexpected surprises. Things like health issues, losing a job, and other unexpected costs, but you have to remember it’s a part of everyday life. If you are going through it, someone else is too or even worse, yet you have to fight through it.

I lost my first job during the month of December and did not find a new full-time gig for almost nine months. But I found a way to not only make enough to pay the bills but enhance my career worth as well.

I still have a lot of work to do on my own financial independence journey, but I want to see my friends and as many people as possible succeed with money.

thumbnail courtesy of businessinsider.com

 Have you made any of these excuses before? It’s alright, we all have at some point in our lives. We ask the Loan Away employees which excuse they have used the most. The most popular was number 4, “I’ll worry about it later”. This excuse just may be the most popular for the majority of Canadians. If you are paying the bills and feel comfortable, the majority of us are content with just that, being comfortable. That transitions to the final thought of the Business Insider article, never get too comfortable. Imagine if something drastic happened like losing your job or health issues. Are you prepared for that? If not, you should save some money just in case. This is a part of life. Be financially ready for the unknown. Enjoyed this article? Great. Let us know via social media or email us your thought, suggestions, or concerns.

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The Main Reason Why People Get Rejected At Banks

The short answer is credit score. Most commercial banks do not want to take high-risk chances, however, just because your credit score isn’t perfect, does this make you high-risk? Yes and no. Yes because regardless of what happened in the past, it reflects on your current credit score. If your credit score is 600, but you haven’t missed a payment in over 2 years, by the bank’s standards, you are still high-risk. Even though your most recent years are flawless, your credit score determines everything for a bank. This is why Loan Away is a successful company. We understand that you have made mistakes in the past and are seeking a loan, however, the bank will say no based on credit score. Loan Away has tens of factors we consider when reviewing an applicant. This has led the company to have the highest acceptance rate in Canada!

The reason why most people get rejected for a personal loan

Whether you’re looking to do home improvements, tackle medical costs, or consolidate debt, you may be tempted to take out a personal loan. These short-term options are unsecured (meaning you don’t have to put up collateral), and can provide an influx of cash when you need it most.

The issue for many Americans is that they can be tough to get.

LendEDU, a marketplace for loans and financial products, just released data showing that 76% of people who apply for a personal loan are declined. One of the main reasons for rejection? A low credit score. The average American has a credit score of 687. Meanwhile, the average FICO credit score of an approved applicant was 741.

Of those who do get approved, LendEDU predicts that just 35% went on to accept the personal loan. It’s unclear why someone would decline a loan they applied for, but the financial site says it could be because they didn’t get the interest rate or loan size they requested.

While some consumers can’t get loans, and others reject them, the fact is more Americans are actually taking out personal loans. Currently, 16 million consumers have an unsecured personal loan. According to a TransUnion, personal lending balances grew a steady 10.8% in the second quarter of 2017, totaling $108 billion.

How to get a loan

The growth of financial technology lenders is one thing helping people gain access to personal loans. These fintech lenders differ from traditional banks because they use technology and algorithms to assess a borrower’s creditworthiness. In some cases, these platforms provide peer-to-peer lending and work as the middleman between borrowers and investors. Back in 2010, fintech only made up 3% of personal loan lenders. In 2015, Transunion says that number jumped to 30%.

If you’re unsure where to find a lender, NerdWallet has a great list where you can compare providers and choose the best personal loan offer based on your credit score and needs.

Popular options include SoFi, a fintech lending site that promises to offer fixed personal loan rates starting as low at 5.49% APR. Applicants can apply for their loan online, and can borrow amounts ranging from $5,000 to $100,000. LendingClub is also a popular peer-to-peer option that has facilitated the borrowing of $31 billion. Applicants on this site can get a personal loan with interest rates starting at 5.99%.

Ultimately, getting approved will come down to your creditworthiness. You may be able to find a lender if your credit score is below 630, but you’ll probably get hit with a higher interest rate of 25% to 30%. In these instances, an online lender wouldn’t be very helpful for consolidating debt because you may face higher interest rates than a credit card. For better results, applicants should have a credit score above 690 to secure a personal loan with a good interest rate.

thumbnail courtesy of finance.yahoo.com

 It’s alright, the majority of us have been rejected by a bank before. It happens to the best of us. They only accept people who have an above credit score instead of the average. This means if you missed even a single payment, you may be declined by a bank. This is discouraging, but you have options for getting the loan you want. If you have a credit score that is deemed bad credit, our loans start at 19% which is the same as a credit card. Our rates are much more responsible than what Brittany Jones-Cooper of Yahoo Finance suggest you will have to pay for. Not only does Loan Away has the highest approval rate in Canada, but also some of the most reasonable prices for financial institutions that provide loans for people with bad credit. Our goal is to help as many Canadians as possible get the loan they want. Often, our clients use the loan to better themselves. Most use the loan for debt consolidation, business loans, or personal loans for emergencies. Overall, we are proud to help any Canadian in need of a loan.

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U.S. Dollar Falling is Good Or Bad For Canadians?

The answer depends on which Canadian you ask. Most Canadians will probably say yes, it is good that the Canadian dollars is worth a similar amount to America. Canadians have been taking out loans to accommodate the currency difference. If the value is similar, prices for consumer goods may be equal to the same as Americans. The other Canadians that think it is bad is because they are likely selling goods to Americans. Think about it, if you sell a product to an American for $40 USD instead of selling it for $40 CAD in Canada, you will make more money. That $40 USD will be around $50 CAD which is great if the USD stays strong. Buyers or consumers want the currencies to be similar while the sellers want the currencies to stay different. Loan Away believes that the Canadian economy would benefit more if the currencies had similar value. Which one do you prefer?

 Why the US dollar has been tumbling

In the shadow of the stock market’s meteoric rise this year, the U.S. dollar has fallen faster and harder than most analysts expected.

The dollar took a beating in 2017, falling nearly 10%, its worst annual performance since 2003. Rather than reversing that trend as the U.S. economy grows and the Federal Reserve raises the country’s interest rates, it has continued with the greenback the weakest it’s been in more than three years compared to a contingent of world currencies used to track its value.

This has happened not just as the stock market has churned out almost daily record highs but as yields on the 10-year U.S. Treasury note have touched their highest level in three years and short-dated bonds have risen to their highest levels since around 2008. All of those things would typically back a strong dollar – one that would keep U.S. money at home and encourage overseas investors to park their money here.

But that hasn’t been the case.

Blame tax cuts

Analysts say one thing that’s driving stock, bond and currency markets in their respective directions is U.S. tax reform. The tax reform bill has equity investors excited about the windfall coming to shareholders, but it’s also expected to push the $20 trillion U.S. national debt higher. That’s driving up Treasury yields and pushing the value of the dollar lower.

“The tax cut is definitely responsible for the bulk of this (dollar weakness),” said Aaron Kohli, interest rates strategist at BMO Capital Markets in New York. “It was a huge deficit hole they were blowing and they’re doing it at a time when the U.S. economic cycle is moving and everything is going perfectly.”

The dollar initially gained as reports circulated that the tax plan would include a border tax or other offsets that would increase U.S. tax receipts. But when the final bill was delivered, it turned out to be more of a tax cut than tax reform and the $1.5 trillion price tag had traders piling into dollar-negative short positions, betting on further weakness.

Speculators’ recently raised net short dollar bets on the dollar to nearly $12 billion, according to calculations by Reuters and Commodity Futures Trading Commission data released on Friday.

As U.S. deficits rise, the country is forced to finance its debts by borrowing from other nations. That reduces the value of the dollar. There are also a number of factors luring cash out of the U.S.

Higher risk, higher reward emerging markets look attractive

The Bank of Japan and European Central Bank are expected to reduce their bond-buying program, which are pumping billions into their respective economies. And globally the economic recovery is making bonds and equities in emerging markets with high-risk, high-reward potential more attractive.

With no end in sight for the global growth story and central banks moving toward less stimulus, analysts also say they’re expecting further dollar weakness, at least in the near term.

“Until the dollar’s done losing, it’s losing,” said John Doyle, director of markets at Tempus Inc in Washington. “I’m staying the hell out of the way of it.”

While he’s also expecting the overall trend of dollar weakness to continue, Karl Schamotta, director of FX strategy at Cambridge Global Payments in Toronto, is cautioning traders that a short-term reversal could be on its way.

“We’re stacked into a huge short position on the dollar and it isn’t really all that justified,” Schamotta said. “If we have anything that triggers a rise in implied volatility in the dollar or a shock in (emerging markets)….the rise in the dollar could be very, very rapid and profound.”

thumbnail courtesy of finance.yahoo.com

 Not everyone is a seller, but everyone is a consumer. That is why Loan Away believes that if the USD and CAD currency have the same value, Canada will overall be better as an economy. This is a likely scenario based on the trend the USD. Since President Trump was in office, the Amercian currency has been dropping. Based on the trend, CAD should be on par with USD within 2 years. This trend is happening because of several reasons, but the main reason is the tax cuts. Financial experts, including the one that wrote the source article from Yahoo Finance, believes the new tax is the source of the U.S. currency falling. The American national debt is at an all-time high and is only expected to grow each year. The American Government will be forced to increase taxes to get more funding to spend money they do not have. Now, this is not just an American problem, but they seem to be the only country to not be doing anything to reduce the debt. As a Canadian, how do you feel about the USD dropping? Let us know on social media or you can email us your thoughts.

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Follow this formula to become a millionaire – David Bach

Is there a secret to being a millionaire? Nope. There is a formula, however, it is unknown to most. It’s quite simple to follow once you focus on your goal. Ready? Save 10-15% of your net income for retirement. That’s it. Nothing groundbreaking, just a simple formula. Now, most will not become a millionaire because of two factors. One, the example is based on over 40 years of saving 10-15% of your income for retirement. Meaning if you are 40 years old and have little to no saving for retirement, it is very unlikely you’ll retire as a millionaire. The second factor is your income. Someone with a higher income will have more money for retirement than someone with a lower income if they both saved the exact same percentage over the same amount of years. The average American nets about $40,000. 15% of that is $6,000. If you invested $6,000 from 20 years old to 60, at an average interest rate of 7%, you will have 1.3 million dollars for your retirement.

 Wealth manager David Bach: Follow this formula to become a millionaire

According to New York Times-bestselling author and co-founder of AE Wealth Management David Bach, getting rich boils down to a simple formula: Setting aside at least 14 percent of your income.

It’s “what the average American has done to become a millionaire by the age of 59 years old,” Bach tells CNBC Make It. “You need to be saving 14 percent of your gross income. That’s the formula.”

14 percent may sound like a lot, but it’s the equivalent of just over one hour’s worth of income each day, the self-made millionaire points out: “I want you to keep the first hour of the day of your income. So from 9:00 a.m. to 10:00 a.m., that hour goes to you.”

Think about it this way, he suggests: “You’re going to work 90,000 hours over your lifetime. Most Americans get to the age of 60 and they have nothing to show for it. What you’re going to have is at least a million dollars in your retirement account if you pay yourself first, one hour a day of your income.”

You may be thinking, “I don’t make enough money to save and invest, let alone save and invest 14 percent of my income.”

That’s “poor thinking,” says Bach. “Chances are, you actually do make enough money to be rich — you’re just spending it on little things. I call this ‘the latte factor.'”

The basic idea of “the latte factor” is that eliminating your $5 daily coffee, or any other regular splurge, could help you save significantly over time.

“I don’t know what you’re spending small amounts of money on, but I know this: $10 a day can change your life. If you’re in your 20s and you start investing $10 a day automatically into your retirement account, at a rate of 8 percent, by the time you hit 60, you’ve got over a million dollars.”

Writers who take issue with Bach’s idea of “the latte factor” argue that it’ll take more than giving up small, daily luxuries to save big or really solve financial woes. As Helaine Olen, personal finance expert and author of “Pound Foolish,” says, the bigger issue for most Americans is “the fixed costs, the things that are difficult to cut back on. Housing, health care, and education cost the average family 75 percent of their discretionary income in the 2000s.”

Still, many people find it helps them gain control over their finances to start with small changes.

More importantly, automate your finances so that 14 percent of your income, for example, goes straight from your paycheck to your retirement savings account. You’ll never even see the money you’re setting aside and will learn to live without it.

After all, “you can’t spend what you don’t have in your pocket,” says Bach.

thumbnail courtesy of cnbc.com

There you have it. You can now become a millionaire. This process is not meant to be quick, but safe and effective. With personal finance, there is no real secret. If there was a secret, it would be “Pay of high-interest debt, create an emergency fund, invest for your retirement, then invest in yourself.” Another one would be “Live within your means”. Don’t buy a brand new Mercedes-Benz, buy something that practical and reliable. Don’t buy the consumer goods just for the image. Instead, buy what is necessary only. The last secret is a summary of the first two “You can look rich or be rich.” Unless you make twice the average salary of the state or province you live in, it is almost impossible to look and be rich.   Choose wisely which one is more important to you. The Loan Away team has already decided they rather be rich than looking rich and hopefully you feel the same way. Liked this personal finance article? Let us know what you liked and how we can improve on Facebook, Twitter, Instagram, or any of our social media platforms.

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Effective Tips That Will Help To Repair Your Credit

When attempting a credit repair to make your credit right once more, it is imperative that you present a solution to all those that you owe money to, and don’t deviate from anything you commit to once it is in place. You need to make a commitment to changing your spending habits. Only buy what you absolutely need. If you had to buy something, ask yourself whether every purchase is both affordable and necessary, and only buy.

You must continue to pay your credit card until the balance in a month is lower than 50% of the credit limit. When your debt is over 50%, credit ratings usually go down. With that said, try to spread out the debt that you have or try paying it off.

Try and maintain good credit.  You can receive a better interest rate if you have excellent credit. This means you won’t have to pay too much on your credit cards.   The interest rate on a credit card can add up to your original loan which can become quite substantial in the end.

Another thing that will help with your credit repair is getting a debt consolidation loan.  Even if your credit is bad, you can still get bad credit personal loans in Canada with guaranteed approval.

Be very wary of programs that do not sound legal.  Some claim that they will legally remove bad credit from your credit history.  Needless to say, this is against the law and any company offering such survives can get into trouble with the law.

Find out how your debt settlement contract will make your credit score look. There are methods that are going to be less damaging than another, and all should be researched before you enter an agreement with a creditor. Remember creditors want their money. They really don’t care about your credit scores. That is up to you to protect.

Dispute any errors that you find on any of your credit reports by sending them a mail, either via the post or by email. If you send the letter by mail, make sure that you send the letter via recorded delivery, to have a receipt of the post.

Credit Repair Dos And Don’ts

For the credit repair plan to work, you need to quit this immediately, if you are currently spending more than you earn. You need to change your way of thinking in this regard. Getting credit has never been easier, making it just as easy for people to buy items they simply can’t afford. Comes with a hefty interest price tag, even though this. Take a realistic look at your financial situation and determine how much you can actually spend.

Avoid bankruptcy at all costs. One way of getting out of debt quicker is to declare bankruptcy.  However, there are consequences for declaring bankruptcy.  Therefore, unless your credit history is so bad already, and therefore getting into bankruptcy will not make much difference to your credit history immediately, avoid getting into bankruptcy

You should pay your credit card balances as fast as possible if you need to repair your credit score. Begin by paying down those credit cards that carry the highest interest rates or the highest balances. This can prove to creditors that you are serious about paying down your debt.

To help improve your credit score, make sure you keep low balances on your credit cards. Making a full use of the credit card limit will not help your credit history improve.

An unfavorable credit score can be brought about by multiple outstanding accounts and no means of settling those debts. Make sure you pay all your creditors instead of limiting it to just a few. Even a minimal payment can satisfy your creditors and keep your accounts from landing in collections.

In order to start the process of credit repair, it is wise to seek new credit as a way to re-establish yourself. By doing this you will be proving to potential lenders you are credit worthy and capable of paying money when you are required.

Repairing your credit rating and cutting down your debt involves a lot more common sense than anything else. You can easily achieve your goal by using these tips.

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How Wealthy Do You Need To Be To Live In Major USA Cities?

The article by CNBC explains how much your net worth needs to be to be financially comfortable and how much you will need to be wealthy. The source of this information is from Charles Schwab report “more than 50 times greater than the actual median net worth of U.S. households”. The report is interesting because it goes into details for the major cities that Americans live. The report also has a poll of 1,000 Americans were asked what does wealth mean to them. 27% say wealth means the amount of money in your saving account, 24% say experiences, 22% affording consumer goods, 19% say peace of mind and 12% say good relationships. Wealth means different things to everyone. At Loan Away, the majority of us concluded that peace of mind also known as financial independence is what wealth means. Knowing that you have enough money to live comfortably for years to come is true wealth.

Here’s how much money Americans think you need to be wealthy in 10 major US cities

When it comes to defining wealth, there’s no clear cut answer.

In fact, according to a 2017 survey from Charles Schwab, Americans are split on what rich means: Some describe wealth as a specific dollar amount and others as a state of mind.

Survey participants were also asked how much money is required to be considered “financially comfortable” and “wealthy” in their cities.

In the notoriously expensive San Francisco Bay Area, locals say you have to have a net worth of over $1 million just to be financially comfortable. To be rich, you need $4.2 million, which is “more than 50 times greater than the actual median net worth of U.S. households,” Charles Schwab reports.

Read on to see what residents of other major U.S. cities think it takes to be financially comfortable there and how much it takes to be wealthy.

Charlotte, North Carolina

To be financially comfortable, you need a net worth of $540,000

To be wealthy, you need a net worth of $1.8 million

Anne Rippy | Getty Images

Charlotte, North Carolina

Denver, Colorado

To be financially comfortable, you need a net worth of $540,000

To be wealthy, you need a net worth of $2 million

Bridget Calip | Getty Image

Denver, Colorado

Chicago, Illinois

To be financially comfortable, you need a net worth of $560,000

To be wealthy, you need a net worth of $2 million

George Rose | Getty Images

Chicago, Illinois

Boston, Massachusetts

To be financially comfortable, you need a net worth of $660,000

To be wealthy, you need a net worth of $2.1 million

Education Images | UIG | Getty Images

Boston waterfront

Dallas, Texas

To be financially comfortable, you need a net worth of $670,000

To be wealthy, you need a net worth of $2.1 million

David Sucsy | Getty Images

Dallas, Texas.

Seattle, Washington

To be financially comfortable, you need a net worth of $570,000

To be wealthy, you need a net worth of $2.4 million

Getty Images

Seattle

Los Angeles, California

To be financially comfortable, you need a net worth of $830,000

To be wealthy, you need a net worth of $2.6 million

David Sucsy | Getty Images

Los Angeles

Washington, D.C.

To be financially comfortable, you need a net worth of $780,000

To be wealthy, you need a net worth of $3 million

Danita Delimont | Getty Images

Washington, DC

New York, New York

To be financially comfortable, you need a net worth of $1.1 million

To be wealthy, you need a net worth of $3.2 million

Dave Kotinsky | Getty Images

New York, New York

San Francisco, California

To be financially comfortable, you need a net worth of $1.1 million

To be wealthy, you need a net worth of $4.2 million

thumbnail courtesy of cnbc.com

 How does this make you feel? As a Canadian in Toronto, Canada, this is not surprising, to say the least. The housing market in large cities is expensive. A prime example is Vancouver, Canada. The housing prices over there are comparable to San Franciso, New York, and other large Amercian cities. What does this mean? Well, you will have to earn more money than the average person to even consider living in one of these cities. Furthermore, expect to be paying more money for a longer period of time each year you wait to buy. The housing market will only become more expensive as time goes on, so we recommend that you do two things before buying a home. 1. Wait for the bubble to pop. It will happen in the 2018 or 2019. Once it pops, the housing market will slow down. 2. Save every dime from now or increase your income. I know this is difficult, but if you don’t do one of the two, you will might not even be able to afford anything in any big city. We hope you enjoyed this article. If you did, please let us know on Twitter, Facebook, Instagram.

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Ways Young People Can Build A Strong Credit Record

Looking to build a strong credit history? Great. We are explaining just how to do that. It is not simple by no means, but if it was simple, everyone would have done it. Loan Away has attached a great guide by Forbes as a reference. Fobes was used because they asked 10 members of their Financial council on the subject. They all provided unique and useful advice that may just help young adults build a strong credit record.  This is important because when you need to make a significant purchase like a home or a car, the better your credit score, the lower the interest will be. The lower the interest, the more money you will save over the years. With over 10 suggestions, we can ensure you that you save money in the near future with these tips.

Ten Ways Young Can People Build A Strong Credit Record

Building a strong credit history is the cornerstone of financial freedom and spending power. For young people, it can be difficult to establish a strong credit score out of the gate and show a solid credit history that lenders take seriously.

According to a report by WalletHub, young people struggle with low credit scores partially because they don’t have the time behind them to establish wealth and experience.

Below, 10 members of Forbes Finance Council provide their best advice for young people looking to build a strong credit record as quickly as possible. Here is what they recommend:

All photos courtesy of Forbes Councils members.

Forbes Finance Council members give their best advice for young people looking to establish strong credit.

1. Set Up Automatic Payments

When it comes to building credit, late payments are your worst enemy. It’s critical that you make all of your payments on time and in full. Instead of leaving that to chance, be sure to set up automatic payments whenever possible. – Jason Crowley, CFA, CFP, CDFA, Divorce Capital Planning

2. Get A Low-Limit Credit Card 

Charging small items to a credit card and then paying it off in full every month builds credit in no time. You can find offers for these at creditcards.com and similar sites, with many offering cards with a $300 limit or so. Make it a point to charge $50-$100 per month on it, never maxing out the limit. Then, pay the balance in full. Your credit rating will increase rapidly within just a few months. – Danielle Kunkle, Boomer Benefits

3. Establish Good Financial Behaviors

In order to build a strong credit record, you have to understand how the credit bureaus operate. Credit card debt is a major factor in determining your credit score. However, I would also advise not to forgo common sense or sound financial advice purely for the prospect of building a better credit record. If you have developed sound financial behaviors, your credit record will reflect that. – Vlad Rusz, Vlad Corp. USA

4. Piggyback Off Of Others First

One smart trick for building strong credit fast is to piggyback off of others. By becoming an authorized user on someone’s credit card, you can start building credit from their payments. Of course, you want to make sure you use someone who maintains a good balance, pays on time and uses an issuer who reports authorized users to all three credit bureaus. – Elle Kaplan, LexION Capital

5. Build A Credit History

Apply for credit cards — even at the retail store level — making certain the interest rate is reasonable and systematically repaying over time. It is not uncommon to get a 0% or 2% auto loan these days, and this way of building credit history is brilliant. Keep your debt in line with your income; building credit history does not mean piling on the debt. – Perry D’Alessio, D’Alessio Tocci & Pell, LLP

6. Take It Slowly

Build your credit slowly and judiciously. Create a budget, and when you need to make a large purchase, include that in your budget so you know ahead of time that the payment for that item fits within the budget. Do not outspend your income. For revolving credit, always pay off the entire balance at the end of each billing cycle; do not carry balances to the next cycle, adding interest to balances. – Robin Hall, VARC Solutions

7. Scrap The Debit Card

There are infinitely more reasons to start using a credit card for all of your day-to-day purchases. Credit cards help users rake in cash, discounts and travel points, and they provide warranties, added security and more. Practice smart consumer habits, such as paying off your card in full and on time every month, and you’ll see your credit record improve significantly. – Don Pratt, jive.com

8. Spend Within Your Means

Using your credit and paying your bills on time goes without saying when it comes to building strong credit. The key is to not overextend yourself with large credit card balances and interest. If you couldn’t afford the expensive vacation with the cash in your bank account, you shouldn’t be using credit to spend outside of your means. Having credit is for larger purchases like a car, home, etc. – Jared Weitz, United Capital Source

Forbes Finance Council is an invitation-only organization for executives in successful accounting, financial planning and wealth management firms. Do I qualify?

9. Minimize Unsecured Debt

The best way to build a strong credit record is to minimize unsecured debt and show regular payment history. Keep one credit card, make timely payments each month, and pair that with some sort of a secured loan, such as a car payment. Doing this at a young age should help build a very strong credit record. – Mahati Mukkamala, Klaviyo

10. Ask For Help

If you’re 21 or younger, you can start building credit by piggybacking on your parents’ good credit history. Get yourself added as an authorized user on one of their credit cards. As an authorized user, you will be issued a credit card linked to your parents’ account, which they can monitor. The real upside is that, if your parents have good credit, you can get a real boost to your own credit. – Stacy Francis, Francis Financial, Inc.

thumbnail courtesy of forbes.com

Did these tips help your understanding of building a strong credit record? I hope they did because they have had an impact on the Loan Away team. The team has taken the advice to heart for the month of January and has already seen great progress. The most useful tip comes from Stacy Francis, ask for help. Most of the time parents will be more than happy to add you as an authorized user because it does not affect their credit score. This is a great way to build credit without spending or taking out loans. Over the next few years, you will have a similar credit score as them. This is not an option for some because of several reasons, but if you have the opportunity, Loan Away highly recommends this method. Want to learn more about credit score and how to have a stronger credit record? Loan Away post at least one article daily for our clients’ stratification. Share and enjoy!

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Using Your Saving To Pay Off Debt?

Should or should you not? Well, this depends on several factors like if you have children, do you pay rent or a mortgage, debt interest rate, and more. We are using the example below from two cents Lifehackers. The question is “I have $2000 credit card debt at 6.9% and $4000 in savings. Should I just pay off my credit card debt in full, or continue to make payments every month and build up my savings account more? I own a home and am worried about having extra cash on hand in case something breaks.” What would you do? The experts have made their suggestion and Canadians have left their opinion too. Loan Away will also share our opinion on what we suggest. We have attached the entire article.

Should You Pay Off Your Credit Card Debt With Your Emergency Savings?

You’ve got questions, we’ve got answers. Each Monday we’ll tackle one of your pressing personal finance questions by asking a handful of money experts for their advice.

This is what individual experts have to say generally about an issue that affects each person differently—if you want personalized advice you should see a financial planner.

Make Short-Term Sacrifices Now

“Given the amount of the debt and savings you have, I would not recommend that use your savings to pay off your credit card debt in full,” says Patricia Stallworth, an Atlanta-based money coach and host of the Minding Your Money 360 podcast. “Doing so would severely reduce your savings and leave you vulnerable if you had an emergency.”

Instead, Stallworth suggests refraining from using your credit card until your debt is under control and making more than the minimum credit card payment. Ideally, you’d also work a little harder to get some extra cash flow. That could include trying to take on extra work on the side, or scaling back your spending for a few months.

“In this case, $200 a month would pay off this debt in less than a year,” she says. “You have an opportunity to eliminate your debt and keep your savings, and you can do it in short order. But it may require some diligence and determination on your part.”

An interest rate of 6.9% is pretty low (the national average tops 16%), as is the $2,000 debt. With that in mind, Ilene Davis, a certified financial planner, suggests a similar approach to Stallworth’s, though advocates attacking the debt a bit more aggressively.

“What I would recommend to this client is to buy nothing that is not ‘life critical’ until the debt is gone, and then pay $150 per week before spending money on anything other than bills and basic necessities,” says Davis. “The debt would be gone in four months, and if this person is wise, they will then invest at least $100 of that $150 to start building wealth while having $50 per week to spend on more fun stuff.”

Paying down your credit card debt will enable you to use the available credit for possible home emergencies in the future.

thumbnail courtesy of twocents.lifehacker.com

The experts say do not use your saving to pay off debt since the interest is at 6.9%. Although you should clear your debt before saving, if the person clears their credit card debt, they would only have $2,000 left in their saving account. What do you think is best? Use the saving to pay off the credit card or to keep your saving and pay your credit card off monthly? Loan Away does not agree with the experts in the article. Here are the reasons why we think the person should use their saving to pay off their debt.

Yes, you will have less cash available, but you will now have more credit available.

You won’t have to pay the interest

Credit cards are a source of emergency funds

If you cannot pay your mortgage or rent with a credit card, you should keep the money in your account.

Unless you have unstable income, paying debt is always the best option

In summary, paying off your debt is almost always the best option.

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No More PIN’s Needed For Credit Cards In 2018?

For the past several years, credit cards needed a PIN to be entered to complete a transaction. Recently, credit cards have introduced “tap”, which allows consumers to complete small transactions which a need of using your PIN. At first, this seems revolutionary to some and frightening to others. If your credit is stolen, anyone can use the tap function to make a transaction. The credit cards are aware of this issue and have been working diligently to solve this issue. Today, finance yahoo have discovered that Visa is working on a solution to this exact problem. Visa is beta testing Biometric credit cards. Basically, instead of using a pin, the credit card will use fingerprint recognition to verify the credit user. This is a similar technology found in smartphones. Is this a more secure and faster method of making transactions with a credit card? Perhaps. The entire Yahoo Finance article is attached below.

No more PINs: Visa testing biometric credit cards

People are just getting used to chip credit cards, but a new technology is already on the horizon.

Earlier this month, Visa (V) announced that it’s testing on-card biometrics for contactless payments at two different banks —Mountain America Credit Union in West Jordan, Utah, and The Bank of Cyprus.

Biometric technology uses physical characteristics to authenticate a person’s identity. In the case of Visa’s pilot, cardholders will use fingerprint recognition instead of PINs or signatures for authentication.

Visa’s biometric card is programmed with a securely stored template of your fingerprint. When the card is used, customers will be asked to hold their fingerprint against a small sensor on the card while inserting the chip into the cardreader or waving it for contactless payment. That fingerprint is then compared to the one stored in the card to verify the user’s identity. Green and red lights are integrated into the card to indicate a good or bad match.

“The world is quickly moving toward a future that will be free of passwords, as consumers realize how biometric technologies can make their lives easier,” said Jack Forestell, head of global merchant solutions for Visa.

Adding biometric features to credit cards is seen as a way to simplify card usage and also make it more secure. As the art of card skimming has evolved, magnetic strips are no longer able to thwart criminals looking to steal your money. By the end of 2017, most banks had issued new chip cards equipped with EMV technology. These chip cards are more secure and harder to hack, but still require a PIN which can be accessed by hackers.

Using biometrics could feasibly help with all of these issues.

Biometric data is unique to each individual, making it harder for criminals to use a stolen card.  Using a fingerprint is more secure than entering a PIN or signature, and these cards use EMV technology, so they’ll be immediately compatible with existing payment terminals.

 While Visa’s biometric credit cards are just being piloted, the company has already unveiled the use of biometrics with other services. Cardholders enrolled in Apple Pay can make contactless payments simply by using their fingerprints. This approves the payment without swiping the card, entering a PIN, or providing a signature.

The future of payments

Visa is just the latest issuer to test out biometrics and credit cards. In April 2017, Mastercard tested its own biometric credit card in Johannesburg, South Africa. The trial took place at a bank and supermarket, and allowed cardholders to use fingerprints for authentication.

Chaya Hendrick is the CEO of Smart Metric, a technology engineering company that develops biometric software for credit cards. She says that PIN technology is more than 30 years old, and that consumers are ready for a better option.

“Phones have already demonstrated the acceptability of biometrics for security, and consumers readily accept that biometrics are safer than passwords,” said Hendrick. “The market wants a better and more secure credit card.”

One thing that may hinder the popularity of these cards is the cost associated with having one. According to Hendrick, biometric credit cards contain a small circuit board as thin as a piece of tissue paper, a component that costs way more than an existing chip card. “At this point in time you’re not looking at a giveaway product,” she told Yahoo Finance.

This means that customers who chose to use the biometric credit card will likely have to pay for it. Hendrick speculates that this could be as high as a one-time fee of $69.95.

That fee, however, may be one that Americans are willing to pay. After the Equifax breach, more and more consumers are worried about fraud and looking for other ways to protect their identity. Perhaps that’s why a recent studycommissioned by Visa found that 86% of consumers are interested in using biometrics to make payments.

In the meantime, Visa says that it has plans to expand their biometric technology to more partners in the future.

thumbnail courtesy of finance.yahoo.com

 Impressive right. In the past 5 years, credit cards with chips, payment via smartphones, and tap were all introduced soon after. Visa is projecting to have biometric technology implemented in most credit cards within a year.  Will consumer adjust to this change? According to Yahoo, 86% are interested in using these credit cards. However, how secure will this technology be? The biggest concern Loan Away has thought of is how will Visa have a fingerprint sensor on a credit card? Credit cards are 0.76 millimeters thick and most fingerprint sensors are almost double the size of credit cards. Only time will be able to tell how Visa will be able to accomplish this feat. For more information about credit card technology, check our blog as we will be keeping you up to date. Like this post? Great! Share it with people who you think would benefit from this article.

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Are you ready for a unplanned expense? (Most aren’t)

 Can only 39% of North Americans cover a $1,000 unplanned expense? This report is according to Bankrate. Bankrate says that if a unplanned expense happened, 39% will pay from their saving, 19% will finance with their credit card, 13% will reduce spending, 12% will borrow from a friend or family, and 5% would take out a loan. This is concerning. Majority of North Americans do not have the funds for a $1,000 expense is the reality of a tough economy. What can we do to prevent this from happening to us? Simple. Create an emergency fund of 3-6 months worth of expenses. This fund can be used for unexpected.

Most Americans can’t cover a $1,000 emergency

Life happens: A broken-down car. A leaky roof. A broken bone.

If you were hit with a $1,000 emergency, would you be able to cover it?

For the majority of Americans, the answer is no.

Only 39% of Americans say they would be able to pay for a $1,000 unplanned expense, according to new report from Bankrate.

“Even though unemployment is down and there’s been a recent uptick in wages, we aren’t seeing the needle move savings,” said Greg McBride, chief financial analyst at Bankrate.

Unexpected bills aren’t uncommon. More than one-third of households had a major unplanned expense last year, the survey showed, with half of those costing at least $2,500.

Related: 5 money mistakes to avoid in the new year

Nearly one in five Americans said they would put the expense on a credit card, the report stated, which usually makes the cost even higher as you pay off the interest.

That’s why experts usually recommend you have an emergency fund.

“Having that emergency savings fund will help you sleep at night before and after that unplanned expense,” said McBride.

He recommended having six months of living expenses to help blunt the financial blow of a surprise bill. While that can seem like an insurmountable goal, every little bit helps.

Related: Tools to tackle your own savings crisis

“In the last recession we had nearly 7 million people who were out of work longer than six months,” noted McBride. “To someone who doesn’t have any or very little extra funds, accumulating six months of expenses sounds like climbing Mount Everest, but that is the destination.”

Here are four tips to help bulk up your savings:

Save first, then spend

Have a portion of your paycheck go directly into a savings account, McBride recommended.

“Too many people try to save what is left over at the end of the month only to find out there is nothing left over. You have to flip the equation around: save first, then spend what is left over.”

Start early

The best way to make saving a habit is to start early.

“The sooner you can get in that habit the better,” McBride said. “If you can do it when you are young and not making much that, the habit will stick with you as your age and income grows.”

Separate the money

Remove all temptation to spend your emergency savings by keeping the funds separate from your checking account.

Keep your emergency savings stash away from your checking account. “It has to be a dedicated savings account,” suggested McBride.

Find the best savings account

Interest rates on savings accounts are still recovering from their tumble in the wake of the financial crisis, so it’s a good idea to shop around to find the highest rates.

Currently, your best bet is likely an online bank account.

thumbnail courtesy of money.cnn.com

 Are you now ready for an emergency? You sure be. With all of this information, you should be getting ready to increase or create your emergency funds. $1,000 should be the minimum everyone should have in cases of an emergency. There are thousands of scenarios that could happen that could require you to pay $1,000 or more. Shouldn’t you be ready for the unknown? Imagine if you saved $5 per day for an entire year? You would have over $1,800. Saving can be simple if you focus on the end. Like the article by Money CNN, we have agree that you should start saving money first and spend second. Starting early can make a difference in how much you save.  Lastly,  make sure you have the best interest rate possible. The difference between 1 and 2 percent for saving is vital. How much did you enjoy this blog? Let us know via social media or email. We are always happy to receive your feedback.

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Pay off your student loans this year

Another year, another year with student loan debt. It does not have to be that way if you have dedication, hard-working, and focus on paying off your debt. There are five steps that are sure to help you pay your student debt as quickly as possible. However, these tips will only work if you make a financial plan and are persist. The latest financial studies have proven that creating a financial plan or budget has the highest success rate compared to those who do not. The average Canadian student has mid to high $20,000 in student debt; wouldn’t it be amazing if you could pay that debt quicker than expected? If so, this is the article for you! Loan Away has referenced our source below.

 5 Student Loans Resolutions For 2018

The new year is the ideal time for new resolutions.

It’s an opportune time to check your financial life, and create your 2018 student loan game plan.

According to Make Lemonade, there are over 44 million borrowers who collectively owe more than $1.4 trillion in student loans.

Here are five New Year’s resolutions for your student loans.

1. Refinance your student loans

Student loan refinance is often the single best strategy to lower your student loan interest rate, and potentially save thousands of dollars on your student loans.

Student loan refinance allows you to combine your existing federal and private student loans into a new, single student loan with a lower interest rate.

There are multiple private student loan lenders who offer interest rates as low as 2.50% – 3.00%, which is substantially lower than federal student loans and in-school private loan interest rates.

You can choose either fixed or variable rates and loan terms ranging from five to 20 years.

Each lender has its own eligibility requirements and underwriting criteria, which may include your credit profile, minimum income, debt-to-income and monthly free cash flow.

To maximize your chances of being approved to refinance student loans, you should apply simultaneously to multiple lenders.

Since interest rates are expected to rise again this year, now is an opportune time to refinance student loans to lock in a lower interest rate.

Recommended Calculator: Student Loan Refinancing Calculator

2. Consolidate your federal student loans

Federal student loan consolidation enables you to combine your existing federal student loans into a single federal student loan known as a Direct Consolidation Loan.

As its name suggests, federal student loan consolidation does not apply to private student loans. While the federal government does not refinance student loans (only private lenders do), the federal government offers a Direct Consolidation Loan.

Federal student loan consolidation helps you organize all your federal student loans into a single loan with a single monthly payment. You also have access to federal repayment programs and the benefits afforded by federal student loans such as deferral and forbearance.

The downside is that federal student loan consolidation does not lower your interest rate, so it is not a strategy to save money.

With federal student loan consolidation, your resulting interest rate is equal to a weighted average of your current interest rates on federal student loans, rounded up to the nearest 1/8%.

Recommended Calculator: Student Loan Consolidation vs. Student Loan Refinancing Calculator

3. Apply for public service student loan forgiveness

While public service student loan forgiveness may not continue as a federal program (in its current form or at all), Public Service Loan Forgiveness and Teacher Student Loan Forgiveness are still available to qualifying individuals.

Public Service Loan Forgiveness is for student loan borrowers with federal student loans enrolled in a federal repayment plan who are employed full-time in an eligible state, local or federal public service job or 501(c)(3) non-profit job who make 120 eligible on-time payments.

Teacher Student Loan Forgiveness is for full-time teachers with five years of teaching experience in a designated elementary or secondary school or educational service agency that serves students from low income families.

Recommended Calculator: Public Service Loan Forgiveness Calculator

4. Increase your monthly student loan payment

This may sound counter-intuitive, and it may feel challenging to find extra money to increase your monthly payment for student loans.

However, interest is always accruing on your principal balance. So paying any amount more than the monthly minimum — whether it’s $10 or $100 — can reduce the cost of your student loans.

Plus, there is no prepayment penalty for paying off your student loans early.

Recommended Calculator: Student Loan Prepayment Calculator

5. Make a lump-sum student loan payment

Another smart move is to use a portion or all of your annual bonus to make a one-time, lump-sum payment toward the principal balance of your student loans.

Instruct your student loan servicer in writing that you want your lump-sum payment to pay down principal only, rather than applying toward future principal and interest payments.

Reducing your principal balance directly will save you money on interest, and help you pay off your student loans more quickly.

 Remeber, the advice given will only be effective if you are persistent and make the necessary lifestyle changes. Which step helped you the most? The staff at Loan Away have tested this guide for several weeks and have this to say about it. Mark said ” Increasing my payments and consolidating it helped the most. When all your bills are one payment, it helps you budget for the future. Increasing the payment has not changed my lifestyle at all. No that I have less spending money, I spend less and save more. I felt like I had little control over my finances, but this guide Loan Away recommend has been a true blessing”. Mark was always considered to be financially literate, so imagine the impact this guide can make on those who are financially illiterate? If you know someone who still has student debt, sending this guide might just save them time and thousands of dollars.

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[kishablyons]

Assets that make up wealth

Ever wonder what the profilio of the average person looks like compared to the wealthy? It’s quite different. The wealthy do not have millions of dollars in their bank account, instead, they have assets such as stocks, mutual funds, real estate, and business investments. What does the average person have? Most of their net worth is from their house. Next is vehicles and retirement saving funds. Even though the wealth has similar investments as the average person, the wealthy invest in businesses first. Meaning, the money they get back from investing in businesses is their primary income and asset of wealth. Does this mean you should do the same? Well, yes and no. Once you have cleared your debt with debt consolidation, you can start saving money. The article by visual capitalist explains everything you need to know in great details.

 Chart: What Assets Make Up Wealth?

A LOOK AT ASSET DISTRIBUTIONS, BASED ON NET WORTH TIERS

The Chart of the Week is a weekly Visual Capitalist feature on Fridays.

A person’s wealth can be made up of many different assets.

Net worth, the measure we use to gauge wealth, is actually the sum of all of a person’s assets after subtracting liabilities (such as loans). Therefore, net worth can be comprised of liquid savings, stocks, mutual funds, bonds, real estate, vehicles, retirement accounts (IRAs, pensions), and many other types of assets.

But how does the composition of net worth differ for a person with $100k in net worth, versus that of a billionaire?

Today’s chart uses data from the Federal Reserve Survey of Consumer Finances from 2016 to find out.

SIMPLIFYING THE DATA

Based on this original work done by Ben Weber of Windfall Data, we’ve since taken the data and tried to clean up the categories to make it more digestible.

For example, residential real estate and non-residential real estate were combined into a single category, and bonds, savings bonds, and certificates of deposit were merged into a single fixed income investment category.

The end result is a net worth composition for each of the six different wealth brackets, which are each grouped based on size. For example, in the $10k bracket, all five-figure net worths ($10k-$99k) are grouped together, and so on.

DIFFERENT MAKEUPS

The composition of wealth ends up varying considerably between lower and higher net worths:

Primary Residence: This is by far the most important asset class for all net worth tiers up to $1 million.

Vehicle: For the $10k net worth tier, the value of a vehicle is more than investments such as pensions, IRAs, mutual funds, stocks, etc.

Stocks: The proportion of directly-held stock increases up the tiers, and billionaires hold a significant portion of wealth in stocks.

Business Interests: Most multi-millionaires or billionaires are not liquid, and have most of their wealth in business interests.

thumbnail courtesy of visualcapitalist.com

 Now you know more the wealthy. What will you do with this knowledge? If you are planning to copy how the rich invest, you should consider somethings first. You do not have the capital to invest in companies yet. You will need to build your wealth first. To do this you will have to increase your salary or create a new budget for increase saving. Once you have saved thousands of dollars, you still may not be ready to invest in a business. Consider the stock market. Yes, it is risky, but the reward is great. Having your money in stocks will increase your investment much faster than if you had it in a saving account. Now that you have lots of liquid cash, now you can invest in businesses. If done correctly, your net worth will grow rapidly in the next few years. Loan Away understands that this process is very simplified and difficult to execute, but this is the method to increase your net worth. If this helped you increase your net worth, be sure to let us know in the comments, our social media, or via email.

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[kishablyons]

Jay-Z Inspiring Financial Author

Jay-Z has recently released his latest rap album”4:44″.  In this album, Shawn Carter explained lots of financial topics that amazed his audience. Shawn knows who his target audience is, which is why he was talking from a young black man perspective. Arguably the most memorable line in the song “The story of O.J” is “Please don’t die over the neighborhood, that your momma rentin’ take your drug money and buy the neighborhood. That’s how you rinse it.” Jay-Z was able to launch his career because he sold drugs to pay for his music productions in his earlier career. We recommend to take out a online loan before resorting to illegal practices. We do not endorse any illegal practices in any form. This was his only option as a young black male in New York. What makes Shawn different from other people in his community is he invested his money in himself instead of buying consumer goods. Once he started making a conformable living, he invested in art and real estate. Shawn does admit he made mistakes like buying expensive cars with V12 engines, but he clearly explains that was a mistake that he regrets. A great article was written by Brittany Jones-Cooper of Yahoo Finance. We have included it in our article for your convenience.

Jay-Z inspired this new book of financial advice

There is power in music. It can uplift, motivate and transform lives. In some cases, it can even inspire you to create a strong financial foundation.

As was the case for personal finance expert Ash Exantus, who wrote and self-published the book, “The Wake Up Call: Financial Inspiration Learned from 4:44,” after listening to Jay-Z’s latest album “4:44.”

The book quotes financially themed lyrics from songs on Jay-Z’s album, and provides tips for how readers can implement certain strategies into their own lives. Music critics have commented on the maturity of “4:44,” with the the hip-hop mogul focusing more on his family life, businesses and life approaching 50. As Exantus listened to the lyrics of the songs like “Story of OJ,” “Family Feud” and “Legacy,” he knew there were lessons to share.

“I listened to the whole album 100 times, and every financial principle jumped out at me. I wanted to write about it,” Exantus told Yahoo Finance.

The son of a Haitian immigrant, Exantus, 36, was raised in Harlem’s St. Nicholas housing projects by his single mother. She found work in a factory, but didn’t have a good grasp on the English language, and struggled to understand the financial system in America. At the age of 8, Exantus started working by bagging groceries, and selling T-shirts and CDs on the street.

His early struggles are what inspired Exantus to study money, and at 19 he became a bank teller. By 24, he was vice president of the branch.

Exantus started listening to Jay-Z as a teen, and reveled in the rapper’s tales about drugs, women and cars. “Music raised me because I didn’t have a father figure,” he told Yahoo Finance. “Between the streets and hip hop, that’s what shaped me as a man.” As Exantus matured, so did Jay-Z, and today both men are focused on a more important goal — accumulating wealth for their families and the black community.

“African-Americans have such a history of oppression that it’s still a reality for us in our minds. We don’t walk out the door feeling victorious,” he said. “If you change your mindset and apply certain principles, you can really change the trajectory of your life.”

Exantus hopes that writing this book will make everyone, especially those in the black community, feel empowered and motivated to build strong financial foundations for future generations. Here are a few Jay-Z inspired financial tips to consider.

thumbnail courtesy of finance.yahoo.com

 The story behind the song is powerful. So powerful, an author named Ash “Cash” Exantus wrote a book to cross-examine the financial benefits behind Jay-Z’s lyrics. Its one thing to listen to lyrics like “F*%! livin’ rich and dyin’ broke” and having nothing explaining to the audience “how do I change my lifestyle?”. That’s where Ash comes in. He explains how to actually apply these words of wisdom from Shawn into real life. The Loan Away hasn’t had the chance to read the book yet, but we can assume that ash would explain everything from saving to investing money. We can only hope that ash explains that each investment should be diverse and not just in real estate and art. Jay-Z said “I bought some artwork for one million, two years later, that shit worth two million, a few years later, that shit worth eight million, I can’t wait to give this shit to my children.” and “I coulda bought a place in Dumbo before it was Dumbo, for like two million. That same building today is worth twenty-five million. Guess how I’m feelin’? Dumbo”. I could only hope that the audience understands that these are just examples of his investments and you should invest in what you think would be profitable. If you unsure how to start invest, read financial books. The best investment is usually funds sold by banks. You should expect 5-7% interest rate while having little risk.  Happy investing Jay-Z fans! Did you enjoy this article? If so, share it on social media!

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[kishablyons]

Managing Your Money For A Better Life

Maintaining a healthy relationship with money is difficult for many adults. It doesn’t matter if you do not enjoy dealing with your finances; it is a fact of life that cannot be escaped. By reading the following information, you will be able to learn some things that will help you become financially smart.

If you are making a budget, it must be based in reality in regards to your income and spending needs. Be sure to include all of your income, such as alimony, child support, rental income, or other. Make sure that these numbers are taken from your net income, not your gross income. With these figures in hand, you can tailor your spending to stay within that income. Your monthly expenditures should not be greater than your income. This is important in order to achieve success.

Make sure you have a detailed list of expenses when creating a budget. You want your list to reflect both monthly payments and less frequent ones. Insurance premiums and vehicle maintenance costs, such as oil changes, are also important to consider when adding up your budget. Don’t forget to include anything you spent for entertainment reasons, such as food, storage space, rentals, or other irregular expenses. Be sure to also include even the incremental expenses like daily lunch or coffee or infrequent expenses like a babysitter. This sort of list will help you determine your realistic and prosperous budget.

Once you have a good idea regarding your personal finances, including those little, daily purchases, take a close look at the things you spend money on and see what you can do without. A cup of coffee from home does not cost nearly as much as buying a cup every morning. When you remove such expenses like buying a cup of coffee each morning and start making it yourself, you can save money. Also, if you buy lunch each day, try and bring your own lunch to work. There are many different ways you can lower your utility bills by upgrading and repairing your home. You can install energy efficient windows in your home that act as insulators against heat and cold, thereby reducing energy costs. Upgrading your hot water heater is another way to lower your utility bills. Take the time to read the user’s manual for all of our appliances in order to help you decrease the amount of water or energy used. Your water bill can stay reasonable if you repair any leaky water pipes.

Consider replacing your old appliances. It may sound costly to do that but you will save money in the end. Try to unplug appliances when they are not in use. Before long, your reduced energy consumption will be apparent in your reduced energy bills.

Replacing an aged roof will improve the efficiency of heating and cooling, as will adding insulation in your attic. This will save you on heating and cooling costs throughout the year, and in some cases, your state or local government may offer you tax incentives to boot.

Following the ideas given here will help you balance your budget, and save money. The upfront cost of upgrades always pay off in the end.

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[kishablyons]

Phone scams & how to avoid them

With modern technology, people do not need to see or know you to scam you. You may be thinking the internet is a great place for scammers, but did you know there are still lots of scams via phone still? Yep. Scammers are still using phone as a method of scamming. From Princesses that want to store money in your bank account or people want to offer you loans for under 19.9 interest. You may be thinking “Why not just report the phone number to police?” well scammers have already figured a way around that by disguising their phone number with the internet. We have came across 10 methods of way peolpe can scam you via phone. Dave O’Brien, a writer for record-courier.com has written a great article about this exact topic. We have quote it here for your convenience.

 The top 10 phone scams and how to avoid them

Ever since people have had money, other people have tried to part them from it.

Using modern computer technology — to disguise, or “spoof,” incoming phone numbers on caller ID — along with threats or some convincing acting, scam artists are constantly working to scare people into handing over their hard-earned money.

The best across-the-board way to fight these threats: If you receive calls from anyone wanting to pay you when you aren’t owed anything, or demanding money in lieu of your immediate arrest, hang up and call your local law enforcement agency.

Suspected scams should be reported by calling 911 or local law enforcement . Attempted scams also may be reported to the Ohio Attorney General’s Office by calling 800-282-0515. For scams online, the FBI operates the Internet Crime Complaint Center, where a report can be made by visiting www.ic3.gov.

Still not sure what to look for? These are 10 common scams that local, state and federal authorities say the public still falls for:

1. “Pay or be arrested.”

Scammers call a victim and claim to be a local officer or federal agent and tell the person they have an active warrant. The scammer then says the person must send money using a credit card, gift card or prepaid debit card to clear up the warrants.

Police will never call you on the phone to demand money to clear up active warrants. Brimfield police recently took reports of a fictional “Detective Walker” from “the Brimfield Sheriff’s Department” calling residents and threatening arrest, the department reported on Facebook.

Also, check with local police to make sure that any officer who calls soliciting charitable donations is actually an officer, or with local officers to make sure that a company claiming to represent the police department is truly collecting for charity.

2. The Grandparent Scam

Taking advantage of the elderly, scammers will call at odd hours pretending to be a grandchild or relative, and claim they are in jail and need bail money. An easy way to defeat this scam is to ask specific questions or call the relative in question and check on them, Ravenna Police Capt. David Rarrick said.

“You need to verify” that the person is who they say they are, he said, noting that a similar scam recently was reported in the city. “You need ask questions about the whole event, and if there really is trouble, you can handle that effectively.”

He urged the public to use their best judgment, and call local law enforcement and ask them to check if the relative truly is behind bars or in trouble either locally or out of state.

3. The Computer Fix-it Scam

A caller pretending to be a computer or software expert from an agency such as the fictional “U.S. Cyber Security” will tell the victim their computer has a virus and that they need to hand over passwords or other personal information so the “expert” can fix it remotely from another location.

This scam can result in your computer being hacked and personal information stolen. Mogadore police reported in December that a similar scam had targeted village residents.

4. The Lottery Scam

A caller tells the intended victim they have won money in a contest or state lottery. However, to receive their money, the victim must first send money by debit card, credit card or gift card to complete the process.

These scams increase in frequency as national lottery jackpots rise, according to the Ohio Attorney General’s Office. In every case, the victim will not receive any money, but will lose whatever they send.

5. The Utility Scam

A caller will say they are from one of your utility companies, that you that you are behind on payments and will then threaten to shut off your utilities unless you pay over the phone, either with a credit card, gift card or prepaid debit cards.

Utility companies do not do business in this manner, and Ohio Edison states clearly on its website that it will first send customers a written notice. The company recommends you use only “established payment options” like those on Ohio Edison’s website to clear a balance.

6. The IRS Scam

A person claiming to be an IRS agent or representative will call and demand payment of back taxes, threatening arrest over nonpayment. Or, the caller will say the victim is owed a refund and request bank account information so the money can be directly deposited.

“The IRS doesn’t initiate contact with taxpayers by email, text messages or social media channels to request personal or financial information,” according to its website. A bill on IRS letterhead with legitimate contact information will be sent first informing you of back taxes owed, the agency said.

7. The Work From Home Scam

Rarrick said another popular scam is contacting people with offers to work from home as an online shopper or “secret shopper.”

The scammer says “they’ll contact you for work, and send you a check. You then deposit the money, and send some back in fees with your work product. So you get a $5,000 check, deposit it, and send back the $500 or $1,000 fee, but it’s all bogus. And the check is bad,” Rarrick said.

8. The Storm-Chaser Scam

Following severe weather, so-called home repair firms will contact homeowners personally offering to fix storm damage if the resident turns over their insurance checks. In most cases, no work will be done and the money will be lost.

The attorney general’s office suggests residents get multiple estimates from legitimate, Better Business Bureau-rated repair firms and contact them rather than work with solicitors. Also, when dealing with repair companies, don’t make large payments in advance, get a detailed written contract and understand your cancellation rights.

9. Student Scams

College students are vulnerable to scams that may offer student loan relief/debt consolidation, part-time jobs, apartment rentals or grants.

Never pay anyone money up front if someone offers you a job or money for nothing. Never make a security deposit an apartment without first seeing the property. And remember that most grants require an application and are paid to organizations — not directly to individuals.

10. Online Shopping Scams

A seller will ask you to send money for an item you buy online, after which you will likely not receive the item you paid for. Or, a buyer will offer you a personal check but ask that you not cash it immediately. In most of these instances, you will be left without the money or the item you bought.

Instead, offer to meet potential sellers early in the week, in person and in a safe place such as a police department parking lot where there are security cameras. Deal in cash instead of personal checks, or buy items from reputable online shopping sites such as eBay or Amazon.

thumbnail courtesy of record-courier.com

 A lot more scams that you thought right? It is scary how people can create over 10 ways to scam you out of your hard earned money. From online shopping to student debt scams, it is almost hard to know when someone might be trying to scam you. Here is rule of thumb if you want to avoid being scammed. If it seems to be too good to be true, it is. This saying is very cliche, but it works. Understand that you are very unlikely to win a cruise and if you did, you would have rememeber you signed up for one. Another tip would be to research everything. The phone number, the person’s name that has called you, and the direct phone number you can contact them back at. Searching the phone they called you from might not work because the scammers use hundreds of spoof phone numbers. If the person has an accent, that could be its a scam. If the person on the phone claims to be from a repuatbale company, call the company and ask them questions. If none of that works. research the direct phone number or email they have provided. Have you recieved a phone call from a scammer? If so, let us know how you delt with the situation.

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[kishablyons]

Government policy is forcing poor people into catastrophic debt?

Does the Government want everyone to be successful? Abouslty yes, but that is just impossible. Everyone cannot be successful. There will always be someone with more money. Doesn’t matter how much, everyone will not be equal.  The new budget does not help everyone, it helps the middle and upper class. The low-income citizens are often not forgotten or not even concerned because of several reasons. This is why most of them use bad credit loan providers in Mississauga to get income. Voters generally have higher incomes, more people are in the middle and upper class than the lower-income class. Meaning, the Government must focus on making sure the majority of people are happy. Sadly, this means that lower-income citizens are not concerned. We have included our source in this article for your convenience.

 How government policy is forcing poor people into catastrophic debt

It is extraordinarily expensive to be poor. The less money you have, the more expensive many things are likely to cost. Those with the lowest incomes are often forced to access electricity and gas via prepaid meters – forking out hundreds of pounds more annually than those who pay by direct debit.

And when your income is only just enough to cover your basic living costs, even modest unexpected outgoings can push you into debt. New school shoes, perhaps. Or a train ticket to visit a hospitalised elderly parent. The situation is even scarier with larger buys. What are you supposed to do if you live in a rural area and your car breaks down – borrow the money to fix it, or risk losing your job because the patchy local bus service won’t get you in on time?

Not all debt is the same, of course. The more affluent you are, the more likely it is you’ll be able to access credit at low interest rates. Doorstop lenders and extortionate BrightHouse-style rent-to-own companies target poorer customers because they are the least likely to have other options. Eye-watering annual percentage rates mean debts can quickly spiral out of control. Even initially enticing 0% credit cards can catch you out if you fail to keep up with minimum payments. And if you’re barely bringing in enough to cover rent, food and bills, finding that regular extra income can be a struggle.

In recent years, government policy has only exacerbated the situation. The household benefit cap arbitrarily reduces the means-tested housing benefit households receive to bring their total welfare income below a figure that seems to have been plucked from thin air. Most of those affected are families with young kids, including single parents who are not legally expected to look for work because they have children under the age of three. There are reports of people racking up unmanageable debts trying to keep their heads above water, and of families going into rent arrears and eventually losing their homes.

Universal credit has been similarly disastrous for households struggling to make ends meet. It’s hard to understand why the system was designed with a six-week wait before the first payment (recently reduced to five weeks) until you consider the financial circumstances of those who created it. If you have the kind of income that allows you to put away money for a rainy day, waiting an extra few weeks to be paid is no big deal. Perhaps it genuinely didn’t occur to them that many universal credit recipients would be in a much tougher situation. The alternative is that homelessness and crippling debt are being inflicted deliberately, in an act of apparent sadism.

Zero-hours contracts and the gig economy are also a major cause of financial hardship. One McDonald’s worker I spoke to recently explained how her fluctuating hours made claiming housing benefit all but impossible, and left her unsure whether she’d be able to make rent from one month to the next. She ended up being evicted from her temporary accommodation with just 24 hours’ notice, forcing her to move with her son into her mother’s already overcrowded house. Because she needed to arrange after-school childcare in advance, she had to find money for the full week even if she had only been given a couple of days’ shifts.

Thousands of households face similar struggles. In many circumstances, borrowing money is the only option, even if you’re not sure how you’ll manage to pay it back. It’s hardly surprising, then, that one in four of Britain’s poorest households are falling behind with debt payments or spending more than a quarter of their monthly income on repayments. The findings of a report releasedtoday by the Institute for Fiscal Studies, on behalf of the Joseph Rowntree Foundation, shouldn’t come as a surprise to the government – but perhaps it might push them to act.

Instead of patronisingly offering “free budgeting support” for people struggling as a result of universal credit cuts and delays, they should recognise that falling into unmanageable debt is often the product of impossible circumstances – not simply a personal failing. Rent-to-buy and other high-cost forms of credit should be capped, as payday loans were two years ago. Universal credit should be either fixed or abandoned, and nobody should be left stranded while they wait for delated payments. Efforts should be made to eradicate zero-hours contracts, perhaps by legally mandating that overtime be paid at a higher rate than scheduled hours. The welfare cap should be scrapped; building more social housing is an alternative method of bringing down the housing benefit bill.

Food, adequate housing and other essentials should be recognised as universal rights. The current situation – where people are forced into crippling debt trying to sustain themselves and their families – is a genuine moral catastrophe.

thumbnail courtesy of theguardian.com

 If the government wanted to help out the low-income families they do not have to increase the wage or help with post-secondary. The government could lower the income taxes for those with a lower income. I know the government will have less tax money, but with more people having more money, the economy will increase. More money being spent will allow business to grow and provide those people with better salaries. If the Government cannot afford to tax the poor less, then tax the richer more. There are hundreds of thousands of people with over a million dollars in the majority of countries. If the income tax increased by 2-4% for the very wealthy, that money can help the poor get out of poverty and improve their overall life. This isn’t a full proof idea, but it is a start. Do you have any ideas what the Government can do? If so, share your thoughts with us on our social media pages.

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