investment

Mar

2023

Signs That You Are Ready to Invest

Reading Time: 3 minutes

You are tired of working for money. And you have finally decided to slowly accumulate assets and build your wealth. The question now is are you ready to invest? Here are signs that you are ready to invest:

Investment Prerequisites

Before you enter the world of investing, there are certain conditions that you must meet first:

1. Pay off all your bad debts first

It is highly recommended that you pay off all debts first, most especially the bad debts, if you have any. It does not make sense to invest and earn when the interest that you are paying for your bad debts is higher than the interest that you are earning from your investments.

So, how to know if a debt is considered good or bad?

A good debt is money that you owe to help you generate income. Examples of good debts are debts used to finance your education, business or real estate for rentals.

A bad debt on the other hand, is a debt used to purchase depreciating assets or things that decline in value over time. Examples of bad debts are consumer loans and credit card debts. You need to get rid of your credit card debt first if you have them because out of all the bad debts, they charge you the highest interest rates.

2. Make sure you have adequate cash in your emergency fund.

You should always have enough cash in your emergency fund. Your emergency fund is money set aside for financial surprises in life such as loss of a job, home improvement, car repair or trip to the dentist. The Rule of thumb is that your savings account should be equal to six months of your monthly expenses. Anything in excess of that, you can use for your investments.

3. Make sure you have adequate insurance.

An insurance is your protection for a possible unpleasant and unexpected event that might or might not happen in the future.Thus, you need your insurance to protect your life and your properties and your ability to earn income.

Here are some insurances available in the market today:

Health insurance to pay for your medical bills if you get sick
Life insurance to protect your loved ones just in case something happens to you
Property insurance for your home and vehicle
Disability insurance especially if you are the breadwinner
Travel insurance if you are traveling abroad.

Choose one depending on your needs.

4. Define your financial goals

You need to identify your financial goals or targets. Make them specific and measurable. What are you going to do with the money? When do you need it? How much do you need?

5. Know your investment risk appetite.

Investment risk appetite refers to how much risk you can handle. In investing, the higher the risk, the higher the return. Your emotional tolerance should be able to handle the rise and fall of your investments.

6. Think long term.

Always remember that the purpose of investing is to help you accumulate wealth over time. Long-term investments mean a period of one year or longer. If you are going to be needing the money in a few months time, you are better off just leaving them in your savings account.

7. Understand your investment options.

There are many investment vehicles to choose from. Don’t just jump into investing without having a basic understanding of your chosen investment vehicle. Read a lot and know your options. Choose something that fits your goal, personality and level of involvement. Be careful of investment scams.

If you have satisfied all requirements, then congratulations, you are now ready to make your first investment. Good luck!

First published in Pinoy Smart Living on 12.02.2019.

Feature Image by WOKANDAPIX from Pixabay

Sep

2022

Why Should You Care About Inflation

Reading Time: 2 minutes

You often hear about inflation on TV or read about it in newspapers these days.. However, chances are you don’t really understand what it is all about. Even if you did study economics in college, you would have already forgotten about it. Who cares! You are just too happy to finally have gotten over the course. After all, economics has been constantly voted as one of the most boring subjects ever created. But, what is it really? Why should you care about inflation?

Inflation is a very important economic concept. It should be one of your concerns. Why should you care? The answer is simple, because it affects you. It affects your wallet. It affects your finances. And ultimately, it affects your life.

What is Inflation?

In economics, when you talk about inflation, you talk about the relationship of the prices of goods and services with the purchasing power of your money. Inflation happens when there is a persistent increase in the prices of goods and services, which will ultimately lead to the fall of the purchasing power of your money.

The inflation rate pertains to the percentage increase of the general prices of goods and services. It also means the rate in which the purchasing power of your money is decreasing. In other words, if a chewing gum costs $1 (one dollar) 10; a 7.4% inflation rate means the $ 1 chewing gum will now cost $ 1.074 It also explains why your favorite food in a restaurant is either increasing in price or shrinking in size.

Inflation is a global phenomenon. No country is exempted from inflation. This means that everyone on the planet is affected by inflation, no matter where you are.

So, the next time you see the news reporting the inflation rate, listen and take a good look.

Although we cannot control inflation, there is a way on how we can cope with it. All you need to do is invest your money in investments that give a higher yield than the inflation rate.

Feature Image by Alexandra_Koch from Pixabay

Sep

2022

5 Investments You Can Start Right Now

Reading Time: 3 minutes

If we want to improve our financial life, one of the things that we should aim for is to have an investment fund in our monthly budget. Ideally, you should start investing one you are debt-free. But if you plan things right; then you can do both. So once you pay off your debts; you will be able to appreciate your investment rewards even more. That said, here are 5 investments you can start right now so you can let your money work for you.

1. Real Estate

Real estate properties are always a necessary commodity especially in developing areas. This investment vehicle has a predictable money flow so it is easier to understand than other investment options. Aside from providing income from rentals, it also allows you to enjoy tax benefits and even inflation protection. Real estate values continue to rise especially in economic zones. If your timing is right, you can buy property at a location that is still being developed so you can enjoy higher value as the area become more commercially busy. You can also enjoy high returns on your initial investment when the property goes up for sale.

2. Virtual Assets

Virtual assets are digital assets that you can invest in. You must have already heard of the term cryptocurrency, and most recently it’s offshoot NFT. Cryptocurrency such as bitcoin and others, is a virtual asset that functions similar to traditional currency or fiat. However, unlike traditional currency, you don’t need to go through banks to transact using cryptocurrency. One more advantage of cryptocurrency is that it does not expire unlike vouchers or gift cards and since it is virtual, there will be no fraud or tampering. The cryptocurrency that you have in your digital wallet will always be yours and you can readily exchange it for fiat currency whenever you want.

3. Fast Food Chains

Just like real estate, food will never lose its value so large fast food chains are always a good investment vehicle. There are many well-known fast food restaurants locally and abroad that you can choose from. Of course, it’s good to support your local businesses first so you can help your country’s economy grow. Most of us also have favorite cafe that we go to just to meet-up and to work as well. So why not invest in them too? That means you earn even as you continue to patronize their different branches. It’s like you own a piece of the company you like to visit anyway. Of course, you can do this by investing in the company’s stocks; so start to learn about the stock market so you can invest more confidently. There are other company’s in different industries that you can invest in too.

4. Stock Options

Investing in the stock market is a long-term plan but you can enjoy high rewards for short-term investing through stock options. Start by learning about the difference between stocks and stock options. Stock options are “contracts that allow the investor to buy or sell shares of stocks at a predetermined date, at an agreed upon price. Although investors have the right, they are not obligated in any way to buy or sell the shares.” Get yourself familiar with how you can earn through stock options. Some people end up doing stock options instead of trading in stocks for many reasons.

5. Your Own Business

If you have always wanted to start your own business, then why not consider investing in it? If you are suffering from a toxic work place; then you might want to use your savings to put up a home-based business. A lot of people have started their business from a hobby that they are passionate about. Some have even started different businesses alone or with friends and family. In the end, they settled for the one that fulfilled their sense of purpose and continue to work on growing their brand. Start putting pen to paper and start planning your business. There are many apps to help you grow your business until you can assemble your own dream team to help you.

Investments always have their risks and rewards. So be sure to study each one carefully so you reduce the risk of losing your money. Also, it is always good to not put your eggs in one basket. So as you learn one investment vehicle and invest in it; continue to learn about others and invest there too. This way, even if one investment fails, there will be other streams of income that you can rely on.

Feature Image: Original Photo by Mikhail Nilov on Pexels.

Sep

2022

Why You Should Invest In The Stock Market?

Reading Time: 3 minutes

Putting your money in a low interest savings account is not such a good idea especially if you have big financial goals such as buying a house, sending your kids to college or saving for retirement . The only way to get more money is to make money work for you by investing it. Investments will generate more money for you in the future through interests and price appreciation. In other words, you invest to create wealth.

There are numerous ways on how to invest your money. You can invest in bonds, funds, stocks, stock options, antiques, jewelry, luxury watches, artworks, real estate and even luxury handbags. It all depends on your goals, preferences, time, capital and risk tolerance.

Although there are many investment instruments to choose from, the stock market is a good place for long-term growth to invest your hard earned money . Here are the reasons why you should consider investing in stocks:

1. Best Potential for Growth

Stock market investing is risky. The stocks go down a lot. However, there is a pattern that has always stood the test of time. After each major crisis, the value goes up a lot. In other words, if you think long term, the cumulative gains always outpace the cumulative declines.

Although the most volatile, history has proven that stock market investing gave a high return in the long run. Thus, the rewards definitely outweigh the risks.

2. There is More Than One Way to Invest

Depending on your financial goals and investment appetite, there is no single formula in stock investing. You can mix and match everything. You can invest directly or indirectly through mutual funds depending on your time availability. You can do simple investing or you can do trading if you have advanced knowledge. You can play it safe by investing only in blue chip companies or if you have a high risk tolerance, you can venture into small caps companies also. Again, it all depends on you. The key is to diversify.

3. You don’t Need a Big Capital

Unlike other investment vehicles such as real estate, you don’t need to have a big capital to invest in the stock market. Most brokerage nowadays will let you open an account even with zero dollars. There is also no required frequency nor amount of additional contribution. It all depends on how much you can afford to invest.

4. Trade Anytime and Anywhere

As long as you have an internet connection and a smartphone, you can trade anytime during market hours and anywhere at your convenience. Gone were the days wherein you needed to spend so much time trying to contact your broker on the telephone in order to buy and sell stocks. With technology, you can trade with one click of a button. It only needs a minute or two of your time.

5. Earn Passive Income

Earning from stocks through dividends and price appreciation is the best example of passive income. Imagine yourself earning income even while on vacation with your loved ones. That’s passive income and stock investing can do that for you.

As an investor of a company, you are entitled to receive a portion of a company’s income through dividends despite little or even no effort on your part. Big companies have capable and qualified managers who take care of running the company.

6. Advantage of Compound Interest

Compounding is the process of generating income from your capital’s reinvested earnings. It means you are earning interest on your interest over a period of time. Albert Einstein referred to it as “the greatest invention the world has ever produced” because it is a way to double your money.

If for example you bought Apple shares worth US$10,000 in 1980, in 2017 that initial investment is now worth over US$ 2.7 million through compound interest.

Updated version. First Published in Pinoy Smart Living on 04.09.2019.

Image by Gerd Altmann from Pixabay

Jun

2022

10 Gadgets That Help You Save Money

Reading Time: 4 minutes

Modern technology has allowed us to do much more than when we didn’t have our electronic gadgets and devices. These devices have become a necessity in our daily lives and we have many options to choose from.

Initially, these gadgets are major expenses. But with a little research, we can make the right gadget choices so we can still enjoy their convenience while saving money in the long run.

Here are 10 gadgets that can help you save money. Some of them will cost you a big chunk of your budget initially when you purchase them, but they will make-up for their cost with the money you save for the months, and even years that you will be using them.

1. Rechargeable Batteries or High-Capacity Power Banks

We all know the inconvenience of running around with a gadget low on power. Having rechargeable batteries or a high-capacity power bank while on the go saves you the hassle of looking for an electrical outlet just to make an important call on your mobile phone. You can also use these devices to charge your gadgets even at home so you don’t need to suck up electricity each time you need to charge your device. The good thing is; there are high-capacity power banks that can power-up more than one device at a time, even your laptop. Some of them even have designs that are cute or sleek so you won’t be too embarrassed lugging them around.

2. LED Lighting

LED lighting are designed to last longer while consuming less electricity. So gradually replace your old light bulbs or fluorescent lights with LED lighting to enjoy a brighter home without the added cost. LED lighting is also available for other home fixtures such as desk lamps. Some even have dimming functions so you can switch between day light and night light; or white light for working and yellow light for reading.

3. Energy Star Appliances

When buying new appliances, be sure to check for the Energy Star logo. According to their website:

ENERGY STAR products are independently certified to save energy without sacrificing features or functionality. Saving energy helps prevent climate change. Look for the ENERGY STAR label to save money on your energy bills and help protect our environment.

This goes for kitchen appliances such as oven toasters, microwave ovens, refrigerators, even washing machines, as well as lighting fixtures like Christmas lights. So be sure to check the labels on the appliance or ask the sales person for products and brands certified with an Energy Star logo. This is one way to save on electricity in your home.

4. Smart Power Strips

One of the biggest energy leaks in the home and office are gadgets that are plugged in but not in use. Many of us often leave our mobile phone chargers still plugged into the electrical socket even if we are not charging our phones.

A smart power strip allows you to turn off the power for a particular gadget without having to pull it out of the socket. So you can just click a button to turn it on again if you need to use your kitchen appliance or to charge your device.

5. Tablet

Tablets can save you energy as well as money. Many of your favorite books have digital versions so instead of carrying around the actual book, you can have easy access to a ton of books as well as audiobooks with just your tablet. This means being able to carry more books with you on a lighter load. You even help save on paper and conserve trees! Plus, you can also carry scanned copies of your important documents with you and do many other things with your tablet that you can do on a desktop and your mobile phone.

6. Laptop

Just like a tablet, a laptop can also help you save money. It can do many of the things that a tablet can do but in a greater volume and capacity. Nowadays, when our busy schedules don’t allow us to sit in front of a TV screen to enjoy our favorite shows, a laptop is a great way to download your favorite videos and watch them later on. Newer laptop models also feature longer battery life and a ton of upgraded functionalities to help you work faster and accomplish more tasks throughout the day.

7. Vacuum Sealer

If you hate wasting food, then vacuum sealers are your best friend. Together with a ziplock bag and your refrigerator, you can extend the life of your favorite foods. You can cook a big batch of home-cooked meals and freeze them for future meals. This is one way to stretch your food budget.

You can also use a vacuum sealer for bagging your baon or bento to work or school. This ensures that you keep your food fresh and lessens the possibility of food spoilage due to bacteria build-up especially in warm temperatures.

8. Blender

Blenders are a great way to cut down on chopping veggies. You can also use a blender to make your morning smoothies for breakfast-on-the-go or to make soups out of your veggies.

You can also preserve food with a blender. For example, you can place a small amount of water into the blender and put in your peeled garlic. Blend for a bit for a course consistency or blend some more for finer pieces. Then store everything in a jar and keep in the fridge. You can just pull-out the jar and scoop out the required amount of garlic for your recipes. Also works with other spices like ginger, turmeric and onion. You can also use olive oil instead of water for herbs like basil, parsley, and other herbs.

9. Food Processor

For even more variety to your recipes, a food processor is a great kitchen companion. It can chop food finer than a blender and mixes ingredients better. You can also use it to make purees of fruits and veggies for baby food, chop vegetables finely as well as some meats for making veggie balls or meat balls and a host of other foods including ice-cream! It’s especially helpful for baking recipes.

10. Efficient Shower Head

You can also save money even as you shower! When shopping for a shower head, make sure to ask the sales person for a low-flow shower head. This type of shower head can save you gallons of water use per year and thus lower your water consumption bills in return.

Start saving more money now starting with these gadgets. There are many more gadgets that can help you save money; just do your research. They will cost much more but the initial investment will be worth the savings in the long run.

Updated. First published on Pinoy Smart Living on 2018.09.26.
Feature Image: Original Photo by Brooke Cagle on Unsplash.

Feb

2022

Warning Signs That You are Living Beyond your Means

Reading Time: 5 minutes

To live beyond your means simply means that you are spending more than what you can afford. Statistics show that most people are living from paycheck to paycheck without any kind of financial cushion. This was quite evident on the effect of the recent lockdowns on people’s financial lives. While we all deserve to spend our hard earned income; spending beyond our earnings, not saving enough for emergencies and racking up debt in the process are all recipes for financial disaster. To prevent this from happening, you need to watch out for some warning signs that you are living beyond your means. Even if you were doing fine before the pandemic, you might still need to reassess your finances to check if your current income can still support your previous lifestyle.

It is quite easy to fall prey in this age of consumerism. A wide range of consumer goods are available everywhere in the malls, supermarkets, social media and online stores. With heavy promotion by the media coupled with the support of the banking system through their generous credit to consumers; living beyond your means is so easy to do these days.

The FOMO (fear of missing out) and YOLO (you only live once) mentalities brought about by social media only made matters worse. These mentalities have become the new norm that they have dictated the spending habits of many. While it gives you satisfaction in the present, it gives disservice to your future well-being.

Warning Signs That You Are Living Beyond Your Means

Before it is too late, here are some key indicators that you are living beyond your means. They will serve as warning signs that it is time to scale back on your spending immediately.

1. More than 30% of your Income Goes to your House

Housing is the largest expense of most households. Most people dream of a big nice house thinking that they are buying an asset. However, most people don’t realize that their primary home is no longer considered an asset but rather a liability.

Unless you have a way of lowering your monthly expenses on other parts of your budget, you will find yourself in the poverty cycle if you are spending more than 30% of your income on your house. The allure of a bigger and better house will become a financial problem.

Now, calculate what percentage of your monthly income goes to your housing expenses. Housing expenses include your monthly amortization, real estate property taxes, association dues, house insurance, maintenance costs and utilities. If the amount exceeds more than 30% of your monthly income, you will be much better off finding a less lavish home that will fit your budget.

2. More than 15% of your Income Goes to your Car

If you can purchase your car for personal use in cash, then there is no problem. Problem arises when you borrow money in your auto loan purchase.

Have you heard of the 20/4/10 Rule on Auto Loan? The 20/4/10 Rule keeps your finances in check when it comes to purchasing a car. The rule says if you are going to buy a car, you need to make at least a 20% downpayment. In addition, the terms of payment should not exceed 4 years and that your monthly amortization should not exceed 10% of your monthly earnings. If you cannot follow these rule, it simply means you are buying a car that you cannot afford.

Minimum 20% downpayment
Maximum 4 years term
Monthly payment should not be greater than 10% of income

If you add up all other transportation expenses like fuel, maintenance costs, insurance and your monthly amortization; the total should not exceed more than 15% of your income. If your monthly transportation expense goes beyond that, you are simply living beyond your means.

3. Overdue Notices Fill Up your Mailbox

If you have been receiving late payment, overdue and disconnection notices, or worse you find your utilities constantly disconnected; then that’s clear sign that you are living way above your means. Your monthly budget should include payments for bills and utilities. If you can’t pay for them then it is time to reevaluate which ones are necessities and which ones you are better off without like cable subscription for example.

4. You Borrow Money from Others

If you find yourself borrowing money from friends and relatives or take out personal loans to pay your bills then that is a clear sign that you cannot afford your current lifestyle. Ideally, your income should be enough to cover your day-to-day expenses.

5. You Constantly Worry About Money

You are constantly worried about money, even with small expenses to the point that it is already keeping you awake at night. Your health is already affected. You even get into strenuous discussions and arguments with your spouse.

It is normal to worry about your finances every now and then but if you are constantly experiencing these things on a daily basis. Then, it is so obvious that you have money problems.

6. You have No Savings / Emergency Fund

You have no savings or emergency fund. Even if you have it before the pandemic, you have already used it all up. There is no money left from your current income to set aside for future savings.

Savings are needed for future use. An emergency fund is for unexpected and unfortunate events like a pandemic, unemployment, illness, disability or simply for car repair purposes. Ideally, your family should have enough money saved to cover at least six months worth of your living expenses.

7. You have Rising Credit Card Balances

If you are one of those people who only pays the minimum amount due on your credit card balance every month, then that’s a sign that you are living beyond your means.

Ideally, you should only charge what you can pay off at the end of each billing cycle. Unfortunately, many people have severe problems with credit card usage. If you don’t pay the total amount due on or before your due date, your outstanding balance will charge additional interest rates and fees, and these are carried over every month causing your debt to balloon month after month.

8. You Never Set A Budget

If you are ask questions about your budget like how much do you spend on food each month and you have no idea what the answer is, then you have a problem. A written budget is one of the first and most important steps towards financial freedom. How will you know if you are living within your means if you have no idea where your money is going? Having f inancial goals and sticking to your budgeting plan can prevent money leaks and help you live within your means.

9. You Run Out of Money Before your Next Paycheck

Do you find yourself short of cash long before the next payday? If you do, then that is another sure indicator that you need to downgrade your lifestyle. Your paycheck should be enough to cover your expenses for the period.

10. You Shop / Vacation on Credit

Credit is good when used wisely. It is very convenient because you don’t need to pay in cash for the total cost of an item or service right away. It is fine to avail of zero percent installment offers just as long as you are sure that there are no hidden charges. The rule of thumb is that your payment terms should not exceed the total life span of the item that you are buying.

It is a whole different thing for trip purchases. Yes, you can go on that well-deserved vacation only if you have saved enough for it. Make a plan to save money for that dream vacation.

You can use your credit card for protection. Like for example, some credit card offers free travel insurance if you book using their card. All other vacation expenses should be paid in cash. You can also use your credit card during vacation but for emergency purposes only. If you are one of those people who loves taking vacation all on credit, then you are living beyond your means.

If you score at least four and above, then take it as a warning sign that you are living beyond your means. You have two options, either you increase your income or downgrade your lifestyle. But whatever your choice is, it is best that you start learning financial literacy now to avoid finding yourself in the same situation later on.

Edited Version. First Published in Pinoy Smart Living on 10.30.2018

Photo by Artem Beliaikin from Pexels

Feb

2022

Are You Financially Well?

Reading Time: 2 minutes

Money cannot buy happiness but let’s face it, we need money in order to survive. How can we buy our food without money? How do we pay our bills and how are we going to send our children to school? Whether we like it or not, money is an important factor in our lives. The lack of money can greatly influence our wellness. Many people get sick and many relationships are shattered because of the problem with money. Thus, it is important that we take care of this dimension of wellness. So ask yourself, are you financially well?

Financial Wellness

What is financial wellness? Financial wellness is being able to meet financial obligations and manage finances effectively. When you are financially well, you don’t worry about putting food on the table and paying your bills. You feel secure about your financial future. You are also not worried about losing your job because you have enough passive income to keep you afloat. But most importantly, you can make choices that will allow you to enjoy your life. You will not settle for a job that you do not enjoy. In a nutshell, it is all about having peace of mind when it comes to money.

Sadly, statistics reveal that more than half of the world’s population are living from paycheck to paycheck. Many people don’t even have money set aside for emergency use. And many more are buried in credit card debt. It is a never ending cycle called the rat race. Surprisingly, even those high-income individuals are part of the rat race.

It is not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for.
-Robert Kiyosaki

This means that even if you have a high income, it does not necessarily mean that you are financially well. Financial wellness includes the ability to manage finances effectively. It includes paying your bills in time. It involves not only saving but investing as well. Thus, financial literacy is an important factor in achieving financial wellness.

Road to Financial Wellness

Contrary to popular belief, financial wellness is not reserved only for those people who are born rich or those with a high-paying job. Anyone can achieve financial wellness, regardless of background, age, gender, occupation, race, country and occupation. It is all about the mindset. Having a wealthy mindset is the only road towards financial wellness. Change your p overty mindset to wealth mindset and soon you will find yourself financially well.

Are You Financially Well?

To kick off your journey towards financial wellness, it is important to first assess the state of your financial wellness by answering the following questions:

Do you keep track of your expenses?
Are you spending less than your monthly income?
Do you have and follow your monthly budget?
Do you pay all your bills in full and on time?
Do you have an emergency fund that can cover at least 6 months of your monthly expenses?
Do you have a well-defined long-term financial goal?
Is the amount of your debt manageable?
Do you have insurance that is enough to support your financial needs in case of emergencies?
Can you sleep soundly at night without having to worry about money?
Do you have the ability buy anything that you want and the freedom to choose what you want to do with your time without money issues?

If you answered YES to at least 7 of the questions, then, congratulations! You are financially well!

Nov

2021

No Need to Follow Fashion Trends

Reading Time: 2 minutes

Are you someone who always wants to be with the “in” crowd? Are you always on the look out for what’s new in fashion? Do you fear being left out-of-style? The desire to be always in style with the people around you can be bad for you if it has become an unhealthy obsession. Being in-style maybe a sign that you are trying to keep up with what is considered beautiful. Fortunately, our concept of what is beautiful has transcended just physical appearance. Fashion concepts have also been influenced by this development. Here are some reasons why there is no need to follow fashion trends.

Trends Come and Go

Fashion trends always come and go. Most trends are short-lived. Some may even serve merely as a marketing tool so they have a definite duration. Some fashion pieces are produced as limited edition items. So if you and your friends keep following every fashion trend out there, pretty soon you will have accumulated a lot of clothes and accessories that you can’t use. In the end, you might have to spend more time decluttering your wardrobe than wearing anything in it. Having a fashion classic, such as a little black dress in your closet, is a better option than a whole closet of quick fashion pieces.

Major Money Leak

Having to purchase whatever is fashionable also means that you are creating a major money leak for yourself. With the number of fashion trends cropping up each month; no one will ever be able to buy all of them. You will also not have enough occasions to wear them to. You will just end up living beyond your means. Unless you are a celebrity, wearing an item only once is quite a waste of money. Chasing after fashion trends will not only ruin your budget but maybe your work and social schedules too. If you want to look chic and elegant; there are ways to look expensive on a budget.

You Lose Your Self

Being on-trend means that you don’t develop your own sense of style. Everyone has a fashion sense; whether it be comfy, utilitarian or you just love statement shirts or flower patterns. Maybe you have a collection of vintage belts or scarves that you haven’t worn yet because they are not in style. These are valuable items not just because they are classic fashion pieces but also because of their sentimental value. When you keep following fashion trends; you lose your own personal style.

Don’t be a slave to fashion. Chasing fashion trends is like trying to keep up with the Joneses. Yes, you only live once so go ahead and experiment for fun; but do so in a sensible way. Fashion should be an extension of your self expression. You should develop your own personal style. Your own style not only allows you to express your sense of fashion; it also makes you more memorable to the people you engage with. Remember that when you dress different, you think different. Having your own sense of style also means you can use the clothes you are comfortable wearing. If you have a closetful of vintage items that you would love to use; then create your own style and wear it proudly. Start with some basic closet must-haves and then work your way from there.

Feature Image: Original Photo by Tamara Bellis on Unsplash.

Oct

2021

The Best Investment You Can Make

Reading Time: 2 minutes

When we think about investment, we usually think about money. Having a lot of money can make life more comfortable and convenient. But there are some things in life that money can’t buy. These are the things you need to invest in so that you can enjoy life even if you lose your job or you lack money.

Your Health

We’ve all heard the saying “health is wealth”. Ensuring that you are in your best health is the most basic and the best investment you can make for your self. With good health, you will have the energy to do the things you want and need to do. This means that you can maximize your time in all your activities. Having good health also puts you into a more positive mindset. A healthy person is never too tired to give a smile, for example. So make sure to look after your health so you can be the best you, every day.

Personal Development

One of the best investment you can make is your own growth. Work on improving who you are. Strive to expand your knowledge and understanding in the different areas of your life. Be it through books, audiobooks, seminars or taking classes; put aside time to nurture your own personal development. Not only will this enhance your self-confidence; it will also allow you to be able to help and guide others. It will open up more opportunities for you in your career and social interactions. Investing in your personal development provides you with the resources and opportunities to reach your goals.

Your Dreams

Everyone has a dream. It is what motivates us to get up and work each day. Our dreams drive us to do what is needed so that we can enjoy what we want. As long as we have a dream; we always have hope for a brighter future. So invest in your dreams. Whether it starts with making time for a hobby; making that first call to enquire about a class or workshop, or to practice your basic skills so you can hone them. All dreams start with that one small step. So don’t hold yourself back. Unleash the genius in you little by little. Take that first step and keep moving forward.

Good Relationships

No man is an island. Everyone needs a good friend, a shoulder to cry on or a good listener to tell their dreams and fears to. This is why cultivating good relationships is one of the best investments you can make. When you have a good relationship with your family members; you are assured that you will always have a safe place to go home to. Whether you fail or succeed in your goals; there are always people who will love your for who you are. Being surrounded by supportive friends, gives you the courage to go after your dreams because you know someone always has your back. Good relationships gives us a sense of security.

Having money in the bank and good financial investments is always an advantage. But if you can’t enjoy your life because of bad health, feeling worthless or aimless, or not having friends; then you are a poor soul indeed.

Feature Image: Original Photo by Aleksandra Sapozhnikova on Unsplash.

Oct

2021

What To Do If You Can’t Pay Your Mortgage

Reading Time: 3 minutes

Defaulting on your mortgage is not the same as not being able to pay rent. If you miss your rental payment, you can easily talk to the landlord for an extension. If you really can no longer pay, worse scenario is you pack your things and look for another property to rent that is well within your budget. Not being able to pay your mortgage is much more complicated than that. You will not only be putting your property in jeopardy but also your credit score or standing with the bank (or any other financial institution). Thus, as much as possible refrain from defaulting on your mortgage. So, what to do if you can’t pay your mortgage?

Why Your Credit Score Matters

Before we go into that, it is important to understand first why your credit score matters. Your credit score is a rating of your creditworthiness. It indicates whether you are trustworthy enough for the financial institution to pay your debts. It is important because it is a deciding factor each time you borrow money from a bank. The amount of money that you can borrow including the interest rates are affected by your credit score. And the credit score does not only apply to real estate loans but covers all other forms of loans such auto loans, student loans, personal and even credit card loans. Thus, it is important that you take care of your credit reputation by paying your dues on time.

What To Do If Your Capacity to Pay Has Diminished

So what if you are put in a situation wherein you can no longer afford to fulfill your obligation? The first thing that you need to do is to get in touch with the bank long before the due date. Although lenders normally have a grace period for late payments, it is best to get in touch with them before they charge the late payment fee. For record purposes, it is best to put your concern in writing. Indicate your loan reference number. State your reasons or difficulties. And ask them what your options are. There might be programs available to help you.

If your capacity to pay has been diminished, options normally include the following:

1.Forbearance Plan

With this option, the lending institution will agree to temporarily suspend or reduce your monthly mortgage for a brief period of time. It will give you a short term relief to your financial woes until you recover. But once the forbearance period is over, there should be an agreement on how you are going to repay the suspended dues.

2. Debt Restructuring Plan

In a debt restructuring plan, the terms of your loan will be modified. The monthly payments will be lowered but the term will be extended. The purpose is to make your mortgage more affordable.

What To Do If You Already Missed Payments

3. Repayment Plan

A repayment plan is designed to help you pay back your missed payments. In a repayment plan, the lender normally spreads your overdue amount in a specified period of time. The amount is then added to your monthly payment until the overdue amounts are repaid; thereby increasing your monthly payment. Once the said period is over, your monthly payment will then revert back to normal.

What To Do If You Can No Longer Afford to Continue with the Mortgage

5. Short Sale

A short sale is a sale of an asset that a seller does not own. If a property is mortgaged, technically, the seller does not own the property yet. In a short sale, the lender sells the property below the mortgage value. It can forestall the foreclosure but the lender loses all profit from the said property. But the good thing about it is that it does less damage to your credit score than a foreclosure.

6. Voluntary Foreclosure

Voluntary foreclosure is done in the event that you can no longer afford to continue with your mortgage. A voluntary foreclosure is initiated by the borrower who can no longer continue with the monthly payments. It is done to prevent involuntary foreclosure. A deed in lieu of foreclosure is an example of a voluntary foreclosure. It can release you of your obligations. A deed in lieu of foreclosure is an agreement where you surrender the deed to your property to your lender. Although you will lose your property, you can avoid a foreclosure report on your credit rating. Although a voluntary foreclosure is harmful to your credit rating, it is not as harmful as involuntary or forced foreclosure.

Feature Photo by Karolina Grabowska from Pexels