Welcome to Wise Bread’s Best Money Tips Roundup! Today we found articles on fast and cheap meals for busy families, things you didn’t know about Apple stores, and a realtor’s tips for getting a lower mortgage payment.
Giving to charity is an important line item in my family budget — but it’s only one line. There are far more charitable organizations that I want to support than I can possibly give money to.
But what if there were a way to support your values without having to free up more money to give to charity? In fact, there is a way. You can do the same things you always do with your money — bank it, invest it, spend it on utilities, and shop — all while providing important financial benefits to the causes you care about.
Socially responsible robo-investing
I’ll never forget the stricken look on my financial adviser’s face when I told him I was uncomfortable with big oil, tobacco, or firearms as investments in my retirement portfolio. He took a deep breath and told me that I would probably have to be a little flexible about that if I wanted to maintain my passive investment strategy. The only other option would be to individually choose the investments I wanted so that my money was aligned with my values. Not only would that be expensive and time consuming (someone would have to do the stock picking), but it would not necessarily grow my money.
Passive investors like me now have the option of investing in funds that only go to companies we approve of. The new robo adviser OpenInvest offers investors the ability to personalize the specific issues they care most about. You simply create an “issue profile” that narrows down the types of companies you would either like to invest in or steer clear of. The robo adviser’s algorithm then creates a basket of about 60 stocks that match your values and should match the returns of the broader market.
It’s hard to imagine life without your cellphone — which makes it an excellent tool to help support your values. Simply changing your cellphone provider can make paying your bill part of your activism.
You think you’ve found the perfect house. But before you plunge into homeownership, you need to watch out for any warning signs this sale isn’t meant to be. Ask yourself whether any of these things apply to you. If so, buying the home of your dreams may just have to wait.
1. You can’t afford 20 percent down
The house may have everything you are looking for, but you need to make sure that the sale price isn’t beyond your means. Ideally, you want to make a down payment of at least 20 percent. This may be a substantial amount of money, but without that down payment, your lender will likely ask you to pay for private mortgage insurance — which can add hundreds of dollars a year to your homeownership costs.
Moreover, the more you can put down up front, the smaller your monthly mortgage payments will be. If you are in the market for a home but can’t hit that 20 percent mark, consider holding off on buying until you have a larger sum saved. (See also: 4 Easy Ways to Start Saving for a Down Payment on a Home)
2. Your mortgage payments would restrict your ability to save
Even if you have the ability to put 20 percent down on the house, you may find that the monthly mortgage payments are higher than you can reasonably afford. The U.S. government recommends spending no more than 30 percent of your gross monthly income on housing. That means if you earn $3,000 per month before taxes, you shouldn’t spend more than $900 per month on your mortgage.
You may get approved for a loan much bigger than you expected, but don’t use this as an excuse to buy more house than you can afford. If your payments are too high, you will find it harder to live comfortably or save money for anything besides housing costs. If you have to go into additional debt in order to make house payments, then your “dream home” could become more of a financial nightmare. (See also: How to Make Ends Meet When You’re House Poor)
3. You didn’t get a favorable interest rate
There are two key things that impact how much you’ll end up paying for a house: the sale price, and the interest rate on the mortgage loan. Even if the sale price is within your predetermined budget, you may find your monthly payments to be onerous if…
Welcome to Wise Bread’s Best Money Tips Roundup! Today we found articles on products need to be financially secure, energy conservation myths you should ignore, and things you can do in the day to sleep better at night.
Money talks. And not just at the cash register. Very often imagery or symbols related to money convey powerful messages about social, political, and economic issues. Let’s review six powerful money images — and what they really mean.
1. Fearless Girl
A major player in the index fund world, investment firm State Street is no stranger to the issues surrounding corporate America. One particular issue that State Street deemed as critical is the need for more gender diversity in the finance sector, particularly the need for more women sitting at company boards. To raise attention to this issue, the company installed a bronze statue of a fearless girl facing the Wall Street bull statue in the financial district on March 7, 2017.
Created by artist Kristen Visbal, Fearless Girl has become such an inspiring piece of artwork that thousands of individuals are requesting New York city officials allow the statue to be on permanent display.
2. Charging Bull
While the Wall Street bull statue may be getting a bad rap as an image of status quo and unchecked power nowadays, it wasn’t always like that. Originally installed in 1987, the bronze bull, with its head lowered as it’s ready to charge, is a symbol of aggressive financial optimism and prosperity. From day one, the 11-foot and 7,100-pound bronze bull became a popular attraction as it gave a sense of hope to institutional and individual investors during the 1987 stock market crash.
3. Harriet Tubman on the new $20 bill
For a couple of years, the U.S. Treasury debated on whether or not to replace the face of Alexander Hamilton on the $10 bill with that of a prominent American woman. The public weighed in very passionately about the decision and, in the end, Hamilton will stay and abolitionist Harriet Tubman will become the new face of the $20 bill (sending Andrew Jackson to the back of the same banknote) in 2020. This is a major change because Tubman will become both the first woman and the first African American to grace the front…
When I graduated from school and started working, my parents and friends told me repeatedly how important it was to start saving for retirement. But when I looked into opening an account, most institutions required $1,000 or more to get started. I didn’t have that much money to set aside, and it seemed so overwhelming. So I didn’t open an account until years later.
I’m kicking myself for it. The earlier you start saving for retirement, the more compound interest it builds and the less you need to invest to retire comfortably. I missed out on years of interest because I was too intimidated by account minimums, and didn’t think of alternatives. (See also: 10 Signs You Aren’t Saving Enough for Retirement)
Instead of making my same mistakes, you can start saving for retirement today by opening a Roth IRA. Below, find out why Roth IRAs are such a useful option and where you can open one without a lot of startup cash. (See also: 4 Reasons Why a Roth IRA May be Better Than Your 401(k))
What is a Roth IRA?
If you’re just starting out, don’t have access to a 401(k), or want to supplement your retirement nest egg, a Roth IRA is a fantastic savings vehicle.
Unlike a 401(k), where you make your retirement contributions with pretax dollars, with a Roth you contribute your after-tax income. While that means you don’t get an upfront tax break, you won’t owe money on account withdrawals once you retire. You already paid taxes, so you can take out the money free and clear.
A Roth IRA is a perfect tool for young people just starting out. Because your contributions are made after taxes, you can take out the principal from the Roth IRA in the…
If you’re reading this, you’re probably at least a little interested in getting your finances in order. Maybe you’ve even tried! Maybe you’ve read a bunch of advice, but nothing seems to work for you. If that sounds familiar, the solution might not be to find more advice. Instead, focus on finding advice that speaks to you.
Personal finance is, you know, personal. It’s right there in the name, but people seem to forget just how much money management has to do with your own unique situation, habits, and behaviors. Some money writers focus on their personal debt stories. Others, like me, usually focus on practical tips. And some financial experts focus on the mindset of money in our society. At its core, though, all of this personal finance advice is more or less the same. It’s the approach that’s different. The best money advice, then, is the advice you can actually relate to.
Find a Story That Motivates You
When I first started reading and writing about money, so many people recommended Ramit Sethi’s I Will Teach You to Be Rich, saying it completely changed their life. Sethi offers the same advice that’s worked for ages, but he packages it in a way that speaks to a lot of people. For example, he’s not into cutting back on lattes. Instead of being frugal and saving $3 at a time, he argues, you should focus on saving money where it matters—housing, food, and other large expenses.
Many people find this attitude refreshing. The idea that they can still enjoy small pleasures, like a daily latte, makes them totally want to do this money thing. The advice seems to contradict traditional personal finance advice, which makes it appealing, but when you really dig into it, the advice is standard: cut back on stuff you don’t care about so you have more money to spend on things you do care about. What sets Sethi’s advice apart, though, is his mindset toward money. And that’s everything.
In other words, he has a relatable story: the guy bucking frugality to take control and do what works for him. People…
Welcome to Wise Bread’s Best Money Tips Roundup! Today we found articles on easy ways to make money from social media, tips to make technology last beyond the warranty, and how to make the most of a health savings account.
When it comes to money matters, Millennials don’t always get a good rap. These young adults are likely to view themselves in good financial health so long as they make the bills at the end of the month, let alone stow a little extra away for retirement. But don’t mistake them as financial illiterates. In fact, there are some common ways Millennials handle their money that could benefit the older generations. (See also: 6 Ways Millennials Have Changed Money So Far)
1. Get Creative
As retirees age, their expenditures fall — but their income drops even faster. Perhaps retirees, who are unlikely to jump back into the traditional workforce due to a suddenly trickling cash flow, can benefit from some Millennial-style money tactics. Indeed, Millennials know how to get creative when it comes to their earnings. The old rules simply didn’t apply to this generation of ’80s and ’90s babies that entered adulthood during the uncertainty of the financial recession. So, they made their own rules. They found their own innovative ways to survive. And now, as they continue to develop a distinctly entrepreneurial spirit, many Millennials are beginning to thrive.
More than any other generation, Millennials have embraced the sharing economy, in which a lawn mower, their car, or a spare bedroom can become a valuable source of revenue. The average Airbnb host earns more than $20,000 a year renting out a full, two-bedroom apartment or house in a major city, and this is exactly the kind of peripheral revenue stream that Millennials have become accustomed to seeking out for themselves.
When it comes to ride-sharing, 21% of Millennials have used user-powered programs like Lyft and Uber to save money while on vacation. Among other age groups, those numbers are much lower — 7% for Gen-Xers and 4% for Baby Boomers. For older retirees, the percentage is presumably even lower. Yet transportation is a significant expense for most retirees, and it’s one that could potentially be lowered through the use of ride-sharing — not only during a vacation, but on a daily basis. Older households spend about $8,000 a year on transportation, ranging from a high of $9,321 for the 55 to 64 age group, to a low of $5,091 for the 75-and-older group, according to federal data.
2. Don’t Buy Stuff, Spend on Experiences Instead
Millennials highly value experiences — concerts, yoga festivals, French lessons, surf lessons, palm readings, trips to Italy — and they…