Budgets Suck. Do This Instead.

Budgeting sucks; it’s really boring and most of us never stick with it. Learn an easy way to (not) budget in only a few minutes a month.

Don’t get me wrong. I’m not saying you should just throw caution to the wind and blow your money on whatever you want. Becoming Financial Independent requires a certain amount of discipline, which means you can’t turn your expenses into a money inferno. BUT that also doesn’t mean you have to cut expenses down to the bone.

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Old-school personal finance books tell you that if you just create a budget and stick to it, then you’re all set and your money problems will be solved. But anybody who has ever tried budgeting knows it isn’t quite that simple or easy. 

In fact, only one out of every three Americans creates and follows a long term financial plan. Obviosuly budgets work for some but we will cover a different approach to manual spreadsheets, 50/30/20 , and the envelope method.

You know you should budget, but you also know you’re not really going to do it. Learning how to budget isn’t the problem, the information is out there.

You can visit any one of hundreds of personal finance blogs to read about budgeting techniques:

  • You can download free spreadsheets on countless sites
  • You can pick up one of hundreds of books
  • You can use any one of dozens of budgeting apps, many are free

Even if you track every dollar and dime you spend for 30 days… you’re still human.

Over the past 10 years in the navy, I’ve messed around a lot with my budget. I’ve set monthly budgets, annual budgets, and weekly budgets.

I’ve tracked my spending using paper and pencil, spreadsheets, and apps like Mint.com. And through this I’ve learned alot.

Tracking spending manually is pointless.

I never keep up or on top if it for very long. And I’m a financial blogger and nerd about this stuff.

Spreadsheet, Graph, Chart, Report, Theme

If I can’t do it, how can I expect you to. Monthly budgets are useless because it’s so easy to underestimate our monthly expenses.

There are some you pay for every month, such as housing, transportation, utilities, food, and debt payments.

Then there are things you pay for less often like car repairs, home improvements, trips and vacations, holiday gifts, and insurance payments. For you, these less predictable expenses may only be 10 percent or so of your total spending. But for me they’ve crept up to more like 30 percent.

And here’s what this means. Accounting for, and “pre-spending,” every dollar you make can be a financial mistake.

If you take your annual take-home pay, divide it by 12, and proceed to spend that amount every month, you’re going to be in trouble when that unexpected expensive repair comes up, or any of lifes financial curveballs comes your way. 

So what you need to do is stop obsessing over the detailed, track-every-penny budgets you’ve always been told were the solution and instead, you need to implement a simple spending plan that’s easy to set up and easy to follow. 

What is a simple spending plan?

A simple spending plan is an easy way to budget that helps you save money, get out of debt, pay your bills on time, and still allows you the freedom to spend money on things you value or keep you sane, within reason of course.

This website contains affiliate links and I will receive a commission at no additional cost to you. Thank you for your support!

Step 1: Track your spending automatically

Budgeting is simple: Subtract your bills from what you earn; save or spend what’s left.

Forget about manually tracking every beer, energy drink, coffee etc. The goal is to set up a system that keeps track of all of your spending electronically without any additional work from you so that you can access it as you need to.

An easy way to do this is by using the single-card method. This is when you use a single debit or credit card for all of your purchases, or as close to all of them as you can, and let technology do the tracking for you.

One of the best ways technology can help our wallets is by eliminating the need to use cash, and therefore, eliminating the need to keep track of our cash expenses. Now this is counterintuitive to what most of the old-school financial gurus say about cash helping you spend less.

Electronic payments are here, like it or not, and the number of times you need cash (for anything) over a debit or credit card are fewer and fewer. But the best thing about using a credit or debit card is that you automatically have a record of all of your spending.

So should you use credit or debit?

An age-old question. If you have a tendency to buy things first and figure out how you can pay for them later, stick to a debit card. But if you’re comfortable with a credit and only charging what you can pay back in full each month, credit cards are more useful than most debit cards for tagging and categorizing your purchases, as well as cash back and rewards that they offer.

Find the best credit cards, how to choose the best card for you, and how to use credit cards responsibly at Nerdwallet.com

If a single card isn’t for you, an alternative to the single-card method are personal finance management (PFM) tools. These applications link to your credit and debit cards, aggregate your transactions, and can even categorize them automatically.

You set spending limits, and they can send an email or text when you hit them. These apps are powerful and effective, if of course, you remember to login occasionally and make sure the categories are right, and view your spending.

But even if you don’t, that’s OK. The important thing is that data is there if you need it.

Why Pursue Financial Freedom?

What is Financial Freedom?

Financial independence is a journey, not a destination: Every day, by the choices we make, we move closer to or farther from Financial Independence. While there are some important milestones along the way (e.g., building an emergency fund, paying off all non-mortgage debt, retirement), these signs mark progress, not the finish line.

Some view Financial Independence as the point where one can live off of savings, a pension, social security, and the like. While the ability to live without the need of a 9 to 5 job is an important step toward Financial Independence, it doesn’t automatically make somebody financially independent. The problem is, we all know of people who are retired but are just getting by and, because of limited financial resources, are not living life as they choose.

Financial independence is not “one size fits all”: What I want or need to live life as I choose may be very different from what you want or need to live life as you choose.

What are You Working For?

You go to work for five days (or more) a week for 40 hours (or more). Even if you love your job, it’s time away from the other things you love, your family, your friends, your hobbies. We want to use the money we work so hard for to pay for our freedom. So, what are our financial goals and how do we achieve financial freedom?

Most of us will spend our entire lives doing hard work to make ends meet. And for what? A house bigger than you really need or can afford full of stuff you never use and don’t even remember buying?

Related: 10 Reasons You’re Still Poor

To pay off credit cards that you charged that house full of stuff to?

For the occasional vacation that you can’t really afford and your boss gives you a hard time about taking?

For the status that driving a Lexus and wearing expensive clothes gives you?

Dave Ramsey says it simply “We buy things we don’t need with money we don’t have to impress people we don’t like.”

Maybe you realize it and maybe you don’t but you’re in debtor’s prison and you don’t have much freedom.

What Can Money Buy?

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When people dream about having money, it’s often the things they would buy that they fantasize about. But material things are not the best part of having money, not even if you have a garage full of Sports cars, lifted trucks, and any fun expensive grown up toys you can think to put in there.

Money can buy choices and choices mean freedom.

Do you hate your job? You can quit and take your time finding a better one.

In an unhappy relationship? Hate the town you live in? 

You don’t have to stay, you can take your money and leave.

Money can buy convenience.

Are you too tired to make dinner? Order out.

Don’t you have time to clean your house? Hire a cleaning service.

You’ve been told to evacuate because of a hurricane? Woo! You’re not going to sit in a flooded house with no electricity for a week. You’re going on a impromtu vacation, which sounds kinda exciting.

Money can buy time. 

You had a baby and you don’t want to go back to work? You’re a stay at home parent now.

Is your sister having a destination wedding in somewhere remote? Excellent, pack your bags.

A family member had surgery and needs you to stay with her for a few weeks? Cancel your appointments, you’re going to be out of town.

All of these examples are examples of having control over your own life, not feeling trapped. When we feel like we’re trapped and we don’t have choices, we feel unhappy and anxious.

Money can buy happiness.

We feel happy when we have control over our own lives. Money can also buy happiness if you know what to buy. Too many people think buying things brings happiness. And it does, but it’s very temporary and usually, the happiness extends only to you.

If you want to spend money to get happy, spend it on experiences. It’s been proven that experiences make us happier than material possessions. And it’s not hard to think of an example from your own life.

Experiences, rather than things, make us happy. And the even better thing about experiences versus things is that you can have all sorts of wonderful experiences for free.

It doesn’t cost anything to take your kid to the park or to go hiking with a group of friends. It doesn’t cost anything to spend the evening making dinner with your partner.

10 Reasons You’re Still Poor

If you ever find yourself asking “why am I broke?” then odds are you’re falling into one of the 10 pitfalls discussed below. Fix a couple of these and you will be able to find a little extra wiggle room in your budget at the end of each month.

You have a job but your paychecks never seem to stretch as far as you think they should and ends never quite seem to meet. You know you should be saving more and spending less, yet you never manage to do either. You’re hoping your financial fortunes will somehow turn around. In the meantime, the debts keep piling up. Sound familiar?

Instead of waiting for your situation to magically improve, it’s time to take a hard look at all the things you’re doing that are contributing to your financial troubles. That’s right: It might actually be your own fault that you have no money. 

 A few will probably look very familiar to you. Follow this advice for fixing your finances and you should be able to dig yourself out of your hole.

No Money, Jeans, Money, Wallet, Poverty

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#1: You Slave Away for a Paycheck

Other than working for commissions or investment banking, where you can leverage company assessts, if you really want to get ahead in life you have to own your own business. I am not saying that you need to quit your job immediately. You need to have the right mindset in order to start your own successful business without quitting your job, or having to put up a lot of money.

At some point, if you want to be wealthy you have to get your own business. Otherwise you will continue to spend all your time making someone else rich.

#2: You Painfully Ignore the Power of Interest

So you were young and dumb and maxed out a credit card because you were desperate. This is not an uncommon occurrence. But that singular decision can have a lasting impact.

Sure missing a payment lowers your credit score, making it harder to get a car loan or that mortgage you’ve been hoping for…everyone knows that.

But that’s not the only the only problem — it’s the crushing interest payments that you didn’t take into consideration. If you send in just the monthly minimum (2% of the balance) on a credit card with a $5,000 balance and 15% interest rate, it will take 32 years to get rid the debt, and you will pay nearly $8,000 in interest on the original $5,000 balance.

#3: Car Poor

What keeps most people from financial freedom? What keeps people from having a solid retirement fund? What keeps Americans poor? It’s not lattes and impulse buys, it’s way too often car payments.

$500/month, invested at an 8% interest rate, over an entire typical adult lifetime, would be over $2 million, but people would rather have a nice car than money. And I get it, you want a nice car, but there are ways to save and wait until you can actually afford a nice car. If you have to finance it, you can’t afford it.

A good rule of thumb is to pay no more than 5x your monthly salary for a vehicle. Figure out that amount, and save first, then buy once you have the money. The idea is to make car payments to yourself in an interest-bearing account, instead of making car payments to a company and paying interest.

If you can break free of the mindset that says “you should care what other people think” or “you deserve a nice car,” you’ll be one step closer to financial freedom!

#4: Unsuccessful People Try to Reinvent the Wheel

Poor people always try to come up with something spectacular and new to make their fortune. This is the biggest trap you face as you work toward your goals. Instead of something new, what you need is a proven system, one that you know works and will help you gain success.

Caveman, Primeval, Primitive, Man

Warren Buffet once said, “I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.”

What is the system that you have in place? Are you trying to reinvent the wheel or do you have one that is proven?

#5: Controlled by Fear

Fear is a natural component of the business world. If the path to success were clear-cut and infallible, then everyone would be wealthy. Because it isn’t, everyone must deal with situations that make them anxious. There are three different ways to process and manage fear: The first two options will destroy your chances for a successful and healthy life, while the third gives you the mindset you need to use fear to your advantage.

1) Some people pretend that fear does not exist. The people who manage fear through ignoring it end up in a life filled with poverty and misery. By ignoring fear, you let it control you because you neither acknowledge it nor learn how to deal with it. Unacknowledged fear renders you impotent in your efforts to reach your goals, and this is the most disempowered state for wealth and success.

2) Other people act in spite of fear. This way of dealing with fear allows you to achieve certain goals despite being afraid; however, it leads you to anxiety. Yes, you will have wealth, but you will constantly be afraid of taking the wrong step. These people are hung up on worries like “What if I fail?” and “What if I don’t hit my goal?” This results in a situation where you second-guess every decision and live in fear of failure.

3) Successful people embrace fear and let it motivate them. These people achieve their goals and do so by acknowledging their fear without letting it ruin their enjoyment of their success.

7 Passive Income Ideas For Increased Cash Flow

How Passive Income Works

Passive income is any money you earn on a regular basis that doesn’t come from a job. In some cases, passive income is money you get from a project or investment that you put money or time into at the start. For example, if you own part of a business but are not actively involved in running that business, your cut of the profits is passive income.

You can also earn passive income from a project that you’ve invested your time in, rather than your money. For instance, if you spend a year writing a book the royalty payments you get from that book’s sales are a form of passive income.

Having a source of income that doesn’t require the day to day grind can offer some unique benefits including :

  • Extra Cash. When you’re short of money, financial experts usually advise you to respond by tightening your belt. Little luxuries, such as a daily latte or cable TV, are usually the first expenses to be slashed from the budget in an effort to make ends meet. But if you can find a way to supplement your regular paycheck with a passive income stream, the extra income can allow you to enjoy these simple pleasures again without going into debt.
focus photography of person counting dollar banknotes
  • A Cushion for Emergencies. Many Americans live paycheck to paycheck, with no savings to fall back on in an emergency. The Federal Reserve’s annual report on the economic health of households  found that 47% of Americans couldn’t easily come up with an extra $400 to cover an unexpected expense, such as a car repair or a trip to the emergency room. A passive income stream could give you the extra cash needed to build up an emergency fund without having to cut back on your current spending.
  • More Job Flexibility. When your job is your only source of income, you’re dependent on it. You’ll put up with unpleasant working conditions or unreasonable demands from a boss, because giving up your job would leave you with nothing to live on. But if you have some passive income to fall back on, you can afford to be a little picky in your selection. If you don’t like your current job, you can afford to ditch it for a new one that pays less, eking out your lower paycheck with passive income. And if you lose your job altogether, you’ll still have at least a little income to hold you over until you find a new one.
  • Extra Money in Retirement. The vast majority of Americans aren’t putting aside enough money to support themselves comfortably in retirement. If you’re in this position, you could one day find yourself with no income except for Social Security, which was never designed to be a family’s sole source of support – and which might have to cut its benefit levels still further before you reach retirement age. But if you do the work now to create a passive income stream, you’ll have some additional money coming in (in addition to Social Security checks) after you retire.
  • An Earlier Retirement. If you can earn enough passive income – from one stream or, better yet, from several – it can replace your paycheck altogether, making you financially independent. This would give you the option of retiring early, or perhaps quitting your current job and taking up a new career that interests you. Making this much money solely from passive income doesn’t happen overnight – but it is possible.

This website contains affiliate links and I will receive a commission at no additional cost to you. Thank you for your support!

Ways to Earn Passive Income

When you see the phrase “passive income” in an article, it’s often referring to money earned from passive income investments, such as dividend-yielding stocks or real estate. However, investing is one of many ways to earn income when you’re not working. There are a variety of other ways to set up a passive income stream by putting in an initial investment of time, money, or both – and there are even a few that don’t take very much of either.

1. Real Estate 

One of the best-known ways to earn passive income is through real estate. Renting out a building can bring in a tidy sum of money each month, with little work in some cases – but it can also require a big chunk of cash up front to buy the property. There are also low and no money down options but these can bring on more risk, and many people recommend the traditional route when first getting started.

Though it can take a while to build up enough cash to put a 20% down payment on an investment property (the typical lender minimum), they can snowball fairly quickly. The key here is to correctly project income and expenses in order to calculate cash flow. However you have to be sure to include the cost of a property manager in your calculations unless you want to manage the property yourself. Even with a property manager, you may be required to make large repair decisions every now and then – so while this is not a 100% passive activity there are completely passive options with real estate investing.

Many buy and hold investors (ie rental property investors) take that excess cash flow and put it toward their next down payment. This allows them to slowly amass portfolios of dozens and sometimes hundreds of rental properties.

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Investing in real estate can be very profitable and mostly passive. However, a lot of people don’t want to deal with owning a physical property where they need to deal with tenants and property mangers.

Another option for passively investing in real estate is through a real estate investment trust (REIT). REIT’s own multiple real estate properties and allow investors to invest in the portfolio. The great thing about an REIT is that there is a 90% distribution rule. Each REIT is required to pay out 90% of their net income as a dividend to investors.

One of my favorite places to invest in REIT’s is through Fundrise. They have a historical return of 8.7 – 12.4%. Plus, you can invest with as little as $500.

Related: Best Real Estate Crowdfunding Platforms for Passive Income

Investing in REIT stocks can also be a great way to make passive income. It requires an upfront investment, but once you’ve done your research and found solid companies with high dividend yields, you can sit back and collect the dividend checks (or reinvest the dividend earnings).

Related: How to Passively Invest in Real Estate

2. Residual Sales Income

Typically, when you work in sales, you earn your money in the form of commissions. Every time you sell a product or a service, you are paid a percentage of the money paid by the customer. With some types of sales jobs, however, you don’t just earn a single commission when you make a sale – you also receive ongoing residual payments from sales you’ve made in the past. This type of residual income that can last for years after the original purchase.

Products and services that sometimes pay their salespeople this way include:

  • Insurance. Say you’re an insurance salesperson who has just sold a 10-year term life insurance policy. You earn a one-time commission for making the sale, but you also earn a percentage of the monthly premium every time the buyer pays it. So long as the insured keeps making those monthly payments, you can keep collecting residuals off that one sale for up to 10 years.
  • Financial Products. Certain types of financial products, such as annuities, also pay ongoing commissions to the professionals who sell them. Financial advisor Ethan Braid of High Pass Asset Management writes that when he sells a $500,000 annuity, he not only earns a 7% commission, or $35,000, immediately – but on top of that, he gets a 1% “trailer commission,” or $5,000, every year the buyer owns the annuity. So a financial advisor who has sold 10 annuities that are still active could bring in an income of $50,000 a year just from these trailer commissions.
  • Service Contracts. It is sometimes possible to earn residuals for products or services with pay-as-you-go contracts, such as home security services. If a client signs a contract to have his or her home monitored for a monthly fee, the salesperson can receive a residual payment each month the client pays for this service. Furthermore, agreements often pay monthly residuals to sales employees. For example, alarm companies selling ongoing home or business monitoring for a monthly fee may offer residual income to those who sell this service.

No type of sales job can be considered truly passive. In fact, sales can be more active than most jobs, since your pay often depends on how much you sell, and it takes plenty of hustle to bring new customers on board. However, if you’re already working in sales, or considering it as a career, it could be useful to focus on products that can bring in residual income in addition to the usual commission. That way, you can continue earning money on work you’ve already done.

40 Investing Terms You Need to Know

If you are a new investor, you are likely to encounter terms that you don’t understand. As you consider the various ways in which to invest your money, continue to use these terms and definitions as a resource. With a greater understanding of these terms, you can feel more confident researching potential investments.

You don’t have to know everything to start investing. In fact, if you wait until you know everything before you get started, you’ll probably never start investing at all! But there are some basic terms you might want to have in your investing arsenal.

  • Arbitrage: Arbitrage is basically buying a security in one market and simultaneously selling it in another market at a higher price, thereby profiting from the temporary difference in prices.
  • Ask: This is the lowest price an owner is willing to accept for an asset.
  • Asset: Something that has the potential to earn money for you. It is something you own that can reasonably be expected to produce something for you. Assets include stocks, bonds, commodities, real estate, and other investments.
  • Asset allocation: One of the ways to divide up the holdings in your portfolio is to do so by asset class. The idea is that different assets perform opposite to each other, and you can limit some of your risks by allocating your portfolio according to the type of asset you have.
  • Balance sheet: A statement showing what a company owns, as well as the liabilities the company has and stating the outstanding shareholder equity.
  • Bear market: A bear market is when a market experiences prolonged price declines. It typically describes a condition in which securities prices fall 20% or more from recent highs amid widespread pessimism and negative investor sentiment. Bear markets also may accompany general economic downturns such as a recession.
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  • Bid: This is the highest price a buyer is willing to pay when buying an investment. Today, electronic trading makes it possible to ask and bid to be matched up automatically and almost instantly.
  • Blue chip: You might hear reporters and others refer to “blue-chip stocks.” Blue chips are industry leading companies that have a long history of good earnings, good balance sheets, and even regularly increasing dividends. These are solid companies that may not be exciting, but they are likely to provide reasonable returns over time.
  • Bond: This is an investment that represents what an entity owes you. Essentially, you lend money to a government or a company, and you are promised that the principal will be returned plus interest.
  • Book value: If you take all the liabilities a company has and subtract them from the assets and common stock equity of the company, what you would have left over is the book value. Most of the time, the book value is used as part of an evaluative measure, rather than being truly related to a company’s market value.
  • Broker: This is the entity that buys and sells investments on your behalf. Usually, you pay a fee for this service. In the case of an online discount broker, you often pay a flat commission per trade. Other brokers, especially if they also manage your assets as a whole, just charge a percentage of your assets each year. I use Robinhood but M1 and Webull and many others are excellent choices as well.
  • Bull market: This is a market that is trending higher, likely to gain. If you think that the market is going to go up, you are considered a “bull.” Additionally, the term, like bear, can be applied to how you feel about an individual investment. If you are “bullish” on a specific company, it means you think the stock price will rise.
Statue, Bull, Animal, Wealth, Ancient
  • Capital gain (or loss): This is the difference between what you bought an investment for and what you sell if for. If you buy 100 shares of a stock at $10 a share (spending $1,000) and sell your shares later for $25 a share ($2,500), you have a capital gain of $1,500. A loss occurs when you sell for less than you paid. So, if you sell this stock for $5 instead ($500), you have a capital loss of $500).
  • Diversification Diversification of a portfolio is a risk management technique. You spread your investments over different asset classes (stocks, bonds, commodities, real estate) such as to reduce the exposure you have to any one type of security, area and domain. Diversification may help to prevent a higher loss if the market experiences an upheaval.
  • Dividend: A portion of a company’s earnings that is paid to shareholders, or people that own that company’s stock, on a quarterly or annual basis. Not all companies pay dividends. For a getting started in long term dividend investing consider my book: Beginners Guide to Dividend Investing.
  • Dollar Cost Averaging The Dollar Cost Averaging strategies call for investing a fixed amount of money at regular intervals over a period of time regardless of the share price. This is considered a smart investment strategy because the investor does not need to try to pick tops and bottoms.
  • Dow Jones Industrial Average: This average includes a price-weighted list of 30 blue-chip stocks. While there are only 30 companies included on the list, many people think of the Dow when they hear that “the stock market” gained or lost. The Dow is often used as a gauge of the health of the stock market as a whole, even though it is only a very small portion.
  • Exchange: This is a place where investments, including stocks, bonds, commodities, and other assets are bought and sold. It’s a place where brokers (buyers and sellers) and others can connect. While many exchanges of “trading floors” most orders these days are executed electronically.
  • ETF: Exchange-traded funds, a type of investment fund that trades like a stock. Investors buy and sell ETFs on the same exchanges as shares of stock. They are very similar to mutual funds, except that they trade throughout the day on stock
  • Index: A benchmark that is used as a reference marker for traders and portfolio managers. A 10 percent return may sound good, but if the market index returned 12 percent, then you didn’t do very well since you could have just invested in an index fund and saved time by not trading frequently. Examples are the Dow Jones Industrial Average and Standard & Poor’s 500.

What to do During a Stock Market Crash.

Are there Benefits of a Bear Market?

Cheap Stocks = Massive Gains Over Time

If you act effectively, by not selling and rather continuing to purchase stocks, the more bear markets you experience as an investor, the higher the probability that you’ll retire with a bigger nest egg. Years of underperformance tend to be followed by years of overperformance and those years of underperformance present a great opportunity to purchase shares inexpensively.

Other Investors Are Scared of the Stock Market

A simple reason why so many investors and even professional money managers are scared of the stock market–in the short term is stock prices can seem arbitrary. Up one day and down the next, watching the ticker every second the market is open can cause one to wonder just what the heck is going on. 

In the short term, stock prices reflect all kinds of noise. The Fed Chairman says this or that, unemployment numbers come out, or more recently a virus spreads across the world, any of these cause the stock market to react in many ways. The point is that in the short term (About one year or less), stock prices are often the result of factors that do not necessarily reflect the long-term value of the enterprise.

When viewed long term, however, the market truly does reflect the underlying value of public companies. By long term, I mean really long term (10+ years). Stocks can be undervalued or overvalued for a decade. But given enough time, stocks will reflect the underlying value of the corporation that issued the security.

Boost your savings rate

A stock market crash can have a ripple effect on other areas of your life. For example, you may get laid off from your job, have limited access to credit or have a tough time getting clients for your side hustle. For these reasons and more, it’s important to be prepared and have cash saved up.

Experts recommend saving three to six months of expenses in an emergency fund, others as high as 12 months. While this may take some time, there’s no harm in starting to save more as soon as you can.

With increased savings, this will help you weather a storm if the stock market should crash. See last weeks post on maximizing savings.

Dave Ramsey vs Robert Kiyosaki- Is either right or wrong?

Let’s compare two highly successful, well-respected financial entrepreneurs and their respective stances on debt: Robert Kiyosaki, author of Rich Dad Poor Dadsays that there is such a thing as good debt – or debt used to buy money-generating assets like rental properties and businesses. 

 Dave Ramsey,  radio personality and author of The Total Money Makeover, teaches followers to avoid debt altogether. Both agree that  debt carried on credit cards and cars is bad debt, because these things only make us poorer.

Kiyosaki is not completley against using credit cards, but says that balances should be paid in full every month.

While some see Ramsey’s stance on not using credit at all as extreme, the fact that the Federal Reserve estimates that almost half of U.S. households are unable to pay their credit card bills in full each month, and that these households owe more than $800 billion in card debt (about $15,000 per household), lends itself to the idea.

Ramsey proposes using mutual funds as a main investing vehicle for retirement, and is also a self-admitted lover of real estate as an investment, but only if one uses cash to purchase instead of mortgaging. Kiyosaki advocates leveraging and using real estate as a primary builder of passive income and wealth.

Both programs have worked for millions of faithful followers. We could easily leave it at that, but in finance, just as in many other things, we tend to project what we know to be true on others. This is where things can get distorted.

Best Real Estate Crowdfunding Platforms for Passive Income

Real estate crowdfunding has become a real estate investment wave of the future. Individual investors can now buy pieces of commercial real estate projects throughout the country that were once limited to high net worth/income individuals.

Continue reading “Best Real Estate Crowdfunding Platforms for Passive Income”

How to Passively Invest in Real Estate

What’s the difference between being efficient and just being busy? Why is this difference so important and how can you maximize efficiency? Many are swamped and are overwhelmed by it all. Most busy professionals who want to tap into the world of real estate “just don’t have the time.”

Continue reading “How to Passively Invest in Real Estate”