What Not To Do While Trying To Get Out of Debt

What Not To Do While Trying To Get Out of Debt

Jaime Catmull  GOBankingRates  November 6, 2020

If worrying about how to pay off debt keeps you awake some nights, late-night television abounds with alleged solutions. Some ads even promise to get rid of your debt for pennies on the dollar.

Fall victim to these deals and you might be left with worse financial troubles than before. But these aren’t the only foolish ways of paying off debt. Financial experts shared some common mistakes people make while trying to get out of debt  avoid making these same missteps.

1. Not Having a Reasonable Debt Repayment Strategy

When sitting down to tackle your debt, the first step should be to see how much total debt you actually have. Add up any debt you have accrued from student loans, car loans, credit cards, medical debt, home equity loans, payday loans, personal loans and IRS and government debt. If you’ve been dealing with debt for a while, this might add up to a scary number that could leave you feeling overwhelmed, and you might feel like you don’t know how to even begin paying it back.

Why This May Be a Mistake

When you don’t have a clear debt repayment plan, your instinct might be to try to cut back on spending, save more and earn extra money until you’ve saved enough to pay back your debt all at once. However, if you are just making the minimum payments throughout this time, you’ll be accruing more interest all along.

Aim to consistently pay down your debt every month. Whether you want to tackle the highest-interest debt first or the smallest bill, know what your plan is and how you can achieve your goals.

Does It Ever Make Sense To Pay Down All Your Debt at Once?

In many cases, paying off all your debt at once is impossible, so having this as your goal will only set you up for failure. However, if you’ve recently received a bonus, tax refund or another cash windfall that can eliminate or at least pay off most of your debt, this is a great way to use that money.

Paying off debt as quickly as possible will lower the interest you have to pay and also will improve your credit score.

2. Taking Out Payday Loans

If your car or house payment is due before your next paycheck, a payday loan can seem tempting. With a payday loan, the lender gives you the cash you need, and you write a check for the amount you’re borrowing, plus a finance fee.

To continue reading, please go to the original article here:

https://www.yahoo.com/news/not-while-trying-debt-000600661.html

8 Ways To Defend Your Family Finances

8 Ways To Defend Your Family Finances From Whatever Comes Next

Ethan Rotberg  Sat, November 7, 2020

A family budget is a delicate thing to balance, even without a pandemic crashing through and jumbling your finances. In a chaotic year like this, with the country dealing with a recession, ugly unemployment rates, political tensions and new waves of the coronavirus, you’ll need to arm yourself with extra financial tools to protect your household from potential money troubles.

Here are eight ways you can defend your family’s finances, starting today.

1. Clear as much debt as you can

Paying down debt may be the most impactful way to protect your family’s finances — especially if high-interest debts like credit cards are draining more of your cash each month.

So long as your credit score is in decent shape, you should consider consolidating your debts with a personal loan. With a good debt consolidation loan, you can replace all of your debts with a single loan at a much lower interest rate.

That will save you money and give you some breathing room. A free service will allow you to quickly compare loan offers from multiple lenders, making it easy to find the best rate possible.

2. Stop up the leaks in your budget

The pandemic has already forced us to cut back, whether we like it or not. But you may still be leaking money out of your family budget if you're paying too much for services like your cellphone plan, or if you're not using a cash-back app to save every time you shop.

Plug the leaks by looking for the better deals that are out there. For example, with a little comparison shopping you may be able to save $1,000 a year on your homeowners insurance.  And shop around for your car insurance at least once a year, because you may be severely overpaying for your coverage.

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/8-ways-defend-family-finances-131500884.html

Saving Happiness

Saving Happiness

Jiab Wasserman  Humble Dollar  November 4, 2020

RESEARCHERS HAVE spent decades probing the connection between money and happiness. For instance, a much-cited 2010 study by academics Daniel Kahneman and Angus Deaton found that folks tend to feel happier the more money they make—but only up to a point, which they estimated to be about $75,000 a year.

But using only income to measure the link between money and happiness is incomplete. Another study, entitled “How Your Bank Balance Buys Happiness,” analyzed the connection to people’s “cash on hand.” The researchers found that having more money in checking and savings accounts was associated with higher levels of life satisfaction. But similar to the income studies, so-called liquid wealth appeared to be subject to diminishing returns, with the impact on life satisfaction tapering off as folks have more.

Which brings me to tennis. We recently moved from Granada, Spain, to Alicante, which is about 220 miles to the east and right on the Mediterranean. Alicante has milder weather that’s conducive to outdoor sports all year round, so most apartment complexes have tennis courts. My husband Jim accused me of looking for our new apartment based on the condition of the tennis courts first and the apartment second. Yes, I love playing tennis.

I also have a fondness for tennis analogies. I think saving money is like playing good tennis defense, while making more money is like playing offense. There are plenty of YouTube videos of the best winning shots, but relatively few that focus on the defensive skill that’s needed to keep the ball in play. Playing defense isn’t flashy. Yet Novak Djokovic, arguably the world’s top player, is renowned for his defensive play and for his ability to turn defense into offense.

Along the same lines, making more money, moving up the corporate ladder and building your own business are all exciting. People love to talk about such successes and to show off what this money has bought them, whether it’s the new car or the bigger house. But they never pull out their latest portfolio statement and say, “Look at my balance.” There’s nothing showy about saving money. We often celebrate a pay raise, a promotion or a business success, but we seldom celebrate when we’ve maxed out our 401(k) plan or reached a financial milestone.

In tennis, playing defense is mostly about limiting your mistakes, while waiting for the opportunity to strike. In football, it’s said that “defense wins championships.” Isn’t it the same in life? Progress—and ultimate success—are typically achieved through hundreds of smart, boring, stay-the-course decisions, rather than through flashy gambles.

To continue reading, please go to the original article here:

https://humbledollar.com/2020/11/saving-happiness/

Try Not to Slip

Try Not to Slip

Dennis Friedman Humble Dollar November 6, 2020

THE FLU SEASON was approaching, so I decided to schedule an appointment with my medical provider for a flu shot. The next morning, I received an email from my prescription drug plan informing me that it was processing a payment for $30.80.  My immediate thought: “How could my medical provider charge me for a flu shot that I haven’t yet received? And why aren’t they billing Medicare?” Medicare provides a free flu shot to every enrollee.

I called my doctor’s office to find out what was going on. I explained to the billing department that I had been erroneously charged $30.80. I told the representative that I don’t take medication and the only explanation for the charge had to be the flu shot that I hadn’t received yet.

The representative said that couldn’t possibly be true, because the office doesn’t bill my prescription drug plan. We went back and forth for a while, until he suggested that I call my drug plan to find out what the charge was for. I said, “I know it’s for the flu shot and I’ll be calling you back to get to the bottom of this.”

I grudgingly called my insurance plan. While a representative there had me on hold, I decided to look again at the email I’d received. As I glanced at the message, I noticed in blue letters the words: “Premium payment of $30.80.” Yes, it was my mistake. I didn’t take the time to read the email carefully, and instead got emotional and jumped to conclusions. I usually don’t receive premium payment notifications from my prescription drug plan, but that didn’t excuse my behavior.

The next day, AT&T was coming to my house to service my wi-fi. I recently had my house remodeled and I believed the workers might have broken something during the renovation. I kept telling them that they needed to be more careful with our belongings.

When I reconnected the wi-fi, I couldn’t get access to the internet. I suspected the workers either damaged the modem or the wiring in my house. What else could it be? It was working perfectly before they showed up.

When the service repairman arrived, he bent down, looked at the modem and said, “Oh, I see your problem. You have the wires on the modem reversed. They’re connected to the wrong ports.”

Yes, it was my mistake. I didn’t pay close attention to what I was doing when I reconnected the modem. I was so sure it was someone else’s fault.

I like to think neither of those mistakes would have happened in earlier years. As I’ve grown older, I’ve become more impatient, emotional and overconfident in what I’m doing. I also sometimes don’t see the obvious.

To continue reading, please go to the original article here:

https://humbledollar.com/2020/11/try-not-to-slip/

How to Invest Your 401(K) in Causes You Care About

How to Invest Your 401(K) in Causes You Care About

My Two Cents Oct. 16, 2020  By Charlotte Cowles@charlottecowles

The Cut’s financial advice columnist Charlotte Cowles answers readers’ personal questions about personal finance. Email your money conundrums to mytwocents@nymag.com

Sustainable investing: One more thing to feel guilty about not doing? A luxury for rich people who want to justify the piles of money they’re making in the stock market while the rest of us fret about our jobs? Or a relatively painless action you can take with your retirement savings and then sleep better at night?

Technically, it’s all three. But let’s not overcomplicate things. The good news is that if you have a retirement account, it’s easier than ever to invest it in a way that reflects your values. I think of it as kind of like voting with your money, which is to say, it’s more effective than screaming into the void.

I know: Wading through the bowels of your 401(k) plan is the last thing you feel like doing these days. But in the grand scheme of joyless pandemic should-dos, moving your retirement investments into companies you feel vaguely good about — and divesting from the ones you definitely don’t — is not that unpleasant, especially if you’ve just spent an evening trying to scrub seven months’ worth of mysterious goo out of your refrigerator drawers.

From start to finish, transferring my retirement savings into ESG funds — named for the “environmental, social, and corporate governance” standards that they’re held to — took me less than an hour, including the eight minutes I spent on hold when I got confused and called the investor services line at Vanguard (they were very polite and talked me through the steps). I wouldn’t go so far as to call the process straightforward, but it was simpler than I expected.

(A word on retirement savings: Does it seem insane to focus on what your finances will look like in about 40 years when we’re in the middle of — gesturing around — all this? Of course. My advice: Don’t overthink it. Research shows that people make bad financial decisions when they get overwhelmed. If you’re already saving for retirement, keep doing it. If you’re not, make a plan for how to start.)

Here’s a step-by-step guide to better align your retirement savings with your moral compass.

What exactly are ESG funds?

To continue reading, please go to the original article here:

https://www.thecut.com/2020/10/a-beginners-guide-to-socially-responsible-investing.html

Dave Ramsey Warns: Don't Do These 10 Things With Your Money

Dave Ramsey Warns: Don't Do These 10 Things With Your Money

Sarah Cunnane, MoneyWise November 3, 2020

Dave Ramsey says you have to stop causing your money troubles before you can solve them.

The money management guru has doled out his signature blend of tough-love financial advice and Biblical wisdom since 1992. He learned it all the hard way: In his 20s, Ramsey built a fortune as a house flipper but lost it all when banks started calling in his debts. He had to buckle down to build back up from bankruptcy.

Now his radio show is syndicated on more than 600 stations, and he’s authored several books. He teaches Americans how to avoid wallowing in debt — even during the current financial crisis.

Here are 10 of Dave Ramsey's biggest money "don'ts."

1. Don’t try to tackle your biggest debts first

When you’re deep in debt with multiple loans, freeing yourself can seem impossible. That’s why Ramsey suggests the “debt snowball method.”

Rather than start with the loan with the highest interest rate, Ramsey says to pay off the loan with the lowest balance first, making only minimum payments on the rest. The idea is that each small victory inspires you to tackle bigger challenges.

“It’s more about behavior change than numbers. Once your income is freed up, you can finally use it to make progress toward your savings goals,” Ramsey explained on his website.

The snowball method is one of Ramsey's most common pieces of advice but it's also controversial. If your credit score is hurting, it may be better to use an online service that can help you determine which bills to pay off first to get your score back up.

2. Don’t try to justify frivolous purchases

 To continue reading, please go to the original article here:

https://www.yahoo.com/news/dave-ramsey-warns-dont-10-160500198.html

Plenty Of Fish In The Sea

Plenty Of Fish In The Sea

Posted by TEBI on November 3, 2020

Look At It This Way

 In Ernest Hemingway’s classic novella The Old Man and the Sea, a fisherman who had gone three months without catching anything finally lands a prize marlin and then spends three days and nights trying to reel him in.

On finally killing the giant fish, the man lashes the marlin to the side of his boat and heads for home with the trophy, only for marauding sharks to devour the carcass along the way.

The single-minded devotion of this man to dominating that one fish can be likened to the time and effort that some investors make in finding a bargain in the stock market.

 Like the fisherman, their pride overtakes them and they lose all perspective.

Instead of thinking about the feast their catch will provide, they throw all their energy and resources into nailing that one stock, convinced that they know better the wisdom of the entire market.

For sure, some investors — like Hemingway’s dogged fisherman — will finally snare their desired trophy. But inevitably their prize is whittled away by brokerage and trading costs, the equivalent of the sharks that stripped the marlin of its prized meat. 

To continue reading, please go to the original article here:

https://www.evidenceinvestor.com/plenty-of-fish-in-the-sea/

Scary Stuff

Scary Stuff

Jonathan Clements  |  October 31, 2020

IT’S HALLOWEEN, but not much frightens me—at least financially. My portfolio is broadly diversified, I have the insurance I need, and I have enough set aside for retirement. The highly improbable could happen, but I’m not going to lose sleep over that.

Still, even for those of us in decent financial shape, I see two key reasons for concern. We have no control over either—which is why they might seem scary—but we can take steps to limit the potential fallout.

Rising rates. I’m not forecasting a sharp increase in interest rates. But if that came to pass, not only would bonds take it on the chin, but also we could see grim short-term stock market returns.

U.S. stocks have spent much of the past three decades at what was once considered nosebleed valuations. The long decline in interest rates is a key reason. As the yields on bonds and cash investments have fallen since the early 1980s, investors have become increasingly willing to buy stocks, and that’s driven up price-earnings multiples.

On top of that, U.S. stocks have been nudged higher by two other factors. Corporate tax rates have fallen sharply in recent decades, while company profit margins have been at historically high levels. But these tailwinds could become headwinds: Interest rates might climb, corporate tax rates could rise and profit margins may narrow further.

Still, I think there are two reasons to believe stocks will continue to sport above-average price-earnings multiples. First, as the world has grown more prosperous, investors have more money to invest and an increased appetite for risk, and that’s led them to buy stocks.

Second, today’s big technology companies—as well as other businesses focused on building intellectual capital—almost inevitably look overpriced based on standard market yardsticks, and that’s affecting average valuations for the broad market indexes. What’s the issue? Current accounting standards punish the earnings of companies that spend heavily on research and development, while the intangible assets that often result typically don’t appear on corporate balance sheets.

To continue reading, please go to the original article here:

https://humbledollar.com/2020/10/scary-stuff/

Cash For Gold? Tread Carefully

Cash For Gold? Tread Carefully

By Lesley Gregory  October 29, 2020

With the gold price hitting record highs, it may be tempting to take part in a new gold rush by turning your old or unwanted jewelry into cash.  A swag of dealers is out there panning for gold: “We buy gold jewelry!”, “Cash for gold!”, “Sell your scrap gold!”, the internet ads shout.

We’ve seen this before. A decade ago, as gold approached a high just under $US2000, gold buyers were even spruiking for business from “pop-­up” stalls in shopping malls and hosting Tupperware­-style “gold parties”.

The gold price has now topped that record, but before you hand over Aunty Ruby’s gold bracelet or that “bit too bling” birthday gift to be melted down and recycled, there are a few things you should consider.

Know The Value Of Your Gold

Weigh the gold jewelry you want to sell. While gold is measured in troy ounces, you’ll do this in grams – and you should ask the buyer to put their offer to you as a price per gram.  Working in grams simplifies things as there’s a difference between the troy ounces in which gold is measured and the avoirdupois ounces you’re used to working with elsewhere (a troy ounce is 31.1 grams, while a standard ounce is 28.4 grams).

Next, consider the purity of the gold in your jewelry. Pure gold is 24 carats, so 18­carat gold is 75 per cent pure and 9­carat gold is 37.5 per cent pure. (If you have more than one piece, separate your items into piles of the same purity before weighing each pile separately.)  Now you can multiply the weight by the purity to come up with how much gold you actually have. For example, 100 grams of 18­carat gold jewelry would melt down to 75 grams of gold.

Last, you need to multiply the amount of pure gold by the prevailing gold price. You can find the price per gram on a site like this. At the time of writing gold was about $US61 per gram or about £47. Bear in mind that these are “spot” market numbers, and the currency and gold traders will necessarily build in a profit margin for themselves, lowering these numbers. A rule of thumb is that you should expect about 80 per cent of the spot price.

Know Who You’re Dealing With

To continue reading, please go to the original article here:

https://www.evidenceinvestor.com/cash-for-gold-tread-carefully/

This Secret Research Project Explains A Lot About 2020

This Secret Research Project Explains A Lot About 2020

Notes From The field By Simon Black

October 27, 2020  Bahia Beach, Puerto Rico

In early 1948, a group of US Air Force officers was working on a secret research project in the California desert codenamed MX981.  The purpose of MX981 was to test how extreme gravitational forces from fast-moving fighter jets would impact the human body.  Aviation was still pretty new; in fact, the US Air Force had only been created about six months prior, and the Defense Department wanted to find out just how much physical punishment a fighter pilot would be able to handle.

Most people have never been in a fighter jet. But I can promise you from personal experience, the gravitational force can feel absolutely crushing to the body, even causing a pilot to pass out.  At the time, it was widely believed that the maximum limit on the human body was “18 G’s”, i.e. 18 times the force of gravity. And MX981 was tasked with finding out for sure.

So the researchers built a rail-mounted, rocket-propelled sled; the idea was to get the sled moving up to 200 miles per hour, then slam the brakes so hard that the sled would come to a halt in less than a second in order to simulate extreme flight (and crash) conditions.

They nicknamed their little contraption the “Gee Whiz”. And in early 1948 they started human trials.

The guinea pig was one of the researchers-- a maverick scientist named John Paul Stapp. Stapp was able to subject himself to an astounding 35Gs, far past the theoretical limit.

And at that point another researcher, Captain Ed Murphy, was sent out to take an independent reading of the experiment.

It turns out that Murphy’s crew installed their sensors incorrectly, leading to erroneous readings… not to mention all the other mechanical failures that kept taking place.

The research team was breaking new ground; nothing they were doing had been tried before. The equipment they designed was custom-built, and things broke all the time.

Murphy was reportedly irritated about the constant failures, and at some point complained that ‘if there’s any way they can do it wrong, they will.’

Years later this observation morphed into what’s known as Murphy’s Law, often stated as “whatever can go wrong, will go wrong.”

In that context, Murphy’s Law may be the perfect summary of 2020. Riots and social unrest, political folly, Covid, brutal lockdowns, spiraling debts and deficits, etc.

Countless businesses have been closed, many forever. Even more are unemployed. And many countries are imposing fresh lockdowns after realizing that all of their measures and protections thus far haven’t done a damn bit of good because the virus is spiking once again.

At this rate it wouldn’t be unreasonable to expect an extraterrestrial invasion before the year is out.

One of the more irritating aspects of this situation is the lack of consistency. Everything changes so quickly.

Covid rules, for example, change constantly. Here in Puerto Rico where I live, the governor issues a new decree every week or two; the most recent included a total shutdown of the island’s 911 emergency call centers, though gyms were allowed to increase capacity from 25% to . . . 30%!

Travel rules change even more rapidly; our Sovereign Woman, Viktorija, has been traveling around Europe for the past few months, and her flights have been canceled more times than a Confederate monument.

Businesses are in a world of hurt. They’re one breath away from being shut down by the government.

And if they’re not shut down because of Covid, they’re at risk of being burned to the ground by peaceful protesters, or put out of business by the Twitter mob for not being woke enough.

Financial markets are no better off; many stock markets around the world are trading at dangerously high valuations, propped up solely by rumors and conjecture about more free money from the government.

It’s as if the health of the economy doesn’t matter. The fact that so many people are unemployed, or businesses closed down, doesn’t matter.

Over the past few months, markets have transformed into casinos, where investors are merely gamblers placing bets on whether politicians can agree on how much debt to pile onto future generations.

And speaking of politicians, there’s a whole tribe of card-carrying Marxists now, surging ahead in their respective polls and clamoring to take over their assemblies.

They’re threatening everything from higher taxes to confiscation of entire industries.

And it’s all happened so quickly. Murphy’s Law.

But as the story goes, there’s actually another interpretation of Murphy’s Law.

In 1948, after finally figuring out the proper results of their experiment, the MX981 research team held a press conference, and a reporter asked, “How is it that no one was severely injured during your tests”

John Stapp, the maverick who strapped himself into Gee Whiz, replied, “We do all of our work in consideration of Murphy’s Law. . .”

So you see, in Stapp’s view, the idea was to identify risks… figure out the things that could go wrong… and PLAN around them.

Murphy’s Law is often viewed through the lens of pessimism-- everything’s bad, everything’s going to fail.

But Stapp’s view was totally different; it was grounded in optimism and rationality-- we can achieve success by avoiding mistakes… by actually spending time thinking about what could go wrong and where the potential for loss and failure might be.

This is the very essence of a Plan B.

It requires foresight and flexibility. Things will change, and a good plan needs to be adaptable to what might go wrong.

But most of all, it requires the will to actually just sit down and do it. There is no substitute for execution. After all, your Plan B isn’t going to design itself.

To your freedom and prosperity Simon Black, Founder, SovereignMan.com

This secret research project explains a lot about 2020 | Sovereign Man

How to Live Like You’re Already Retired

How to Live Like You’re Already Retired

Posted by Jacob Schroeder October 16, 2020

The late poet Mary Oliver never worked an interesting job in her life, just as she wanted it. Her fear was that it would take away valuable time and energy from her true passion — writing poetry.

As she explained in an interview:

I was very careful never to take an interesting job. I took lots of jobs. But if you have an interesting job you get interested in it… Believe me, if anybody has a job and starts at 9, there’s no reason why they can’t get up at 4:30 or five and write for a couple of hours, and give their employers their second-best effort of the day – which is what I did.

I am not a full proponent of her idea. If you spend eight or more hours a day at a job, it helps to have at least some interest in what you do.  Still, Oliver makes a good point: There is no reason not to allocate more effort to the things that give us joy and less to the things that don’t.   It may sound trite. But honestly think about how well you do this?  I know I could do much better.

Recently, I struck up a conversation with the grandmother of a boy my sons were playing with at the park. She was a retired accountant who opened a mission for underprivileged children in one of Detroit’s most dangerous neighborhoods. I thought to myself, I want to volunteer at a place like that… some day, when I have the time. Most of us are guilty of waiting to do something until an ideal future arrives, which is never guaranteed to arrive.

In the financial industry, we mostly sell people on the idea of an ideal future that affords them total control over their time to do whatever they want. In other words, retirement. But why focus entirely on the future when we can live to some degree like that now?

There is a lot of research that shows what things unequivocally help retirees live a healthier, happier and more meaningful life (one of which is volunteering). Those same studies and surveys actually tell all of us how to live better lives right now. Because the benefits of those activities encompass all age groups. Essentially, if you want to lead a more fulfilling life, then do the things retirees are told to do to make the most of their remaining years.

As Oliver encourages: give yourself permission to put forth your best effort toward the things that provide happiness and meaning while half-** the less important stuff in life.

 It is something I certainly need to get better at, which is why I have begun to reframe life as if I were retired. That is, putting more intention behind the things I do, with less consideration of what other people and society thinks.

Here are the steps I am taking to try to do that.

To continue reading, please go to the original article here:

https://incognitomoneyscribe.com/2020/10/16/how-to-live-like-youre-already-retired/