How To Financially Cope When Even 47% of Six-Figure Incomes Are Living Paycheck to Paycheck

How To Financially Cope When Even 47% of Six-Figure Incomes Are Living Paycheck to Paycheck

Nicole Spector   Fri, December 16, 2022

It wasn’t long ago when making six figures in the U.S. meant one was doing pretty alright — great, even. Now, amid inflation, a person making that salary may just barely be getting by.

According to a recent report from LendingClub, 63% of Americans were living paycheck to paycheck as of November 2022 — up from 60% in October. Of those pulling in more than six figures a year, 47% reported living paycheck to paycheck, up from October’s 43%.

So how can Americans who are just scraping by paycheck to paycheck cope? They can start by taking control of their finances through the following steps:

1. Itemize Assets and Debts

People living paycheck to paycheck should make a list of all of their assets and debts. This is so they can get a picture of exactly what they have and what they owe.

2. Redo Budget

If a budget was made before these times of heavy inflation, it may need to be looked at again and revamped. Consider areas that can be trimmed down, such as subscriptions to services that are not essential. Be honest about wants versus needs.

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

5 Things Millionaires Do With Their Money That Normal People Don’t

5 Things Millionaires Do With Their Money That Normal People Don’t

Heather Taylor   Fri, December 16, 2022

We’ve all heard stories about the many things wealthy individuals do with their money which those with much more modest incomes do not. Many of these stories tend to revolve around extravagant purchases, like superyachts, private islands and having an unlimited budget for extraneous purchases like glitter.

Much less obvious, however, are the subtle ways those with extreme wealth treat spending and saving money. Here are some things millionaires do with their money that you would be hard-pressed to see a normal person doing.

They Don’t Talk About Money

In a now-viral Reddit thread about non-obvious signs of wealth, a Reddit user named ragnarkar wrote that individuals possessing extreme wealth rarely discuss money.

“There’s a saying that there’s an inverse correlation between how wealthy someone is and how often they mention money, but it’s not that easy or obvious to gauge how often someone actually talks about money without interacting with them a lot,” the Reddit user wrote.

Those without money can’t help but talk about money with others or think about it on a regular basis. Someone with extreme wealth, however, would not bring up the topic in an everyday conversation. This is not to say they don’t pay attention to their overall financial picture. It’s just not a topic for discussion.

They Have Credit Cards That Are Different Colors and Weights Than the Average Person

A regular person likely doesn’t think twice about the color of their credit card. Their focus is usually just on making sure the balance is paid in full each month. Someone with extreme wealth, however, can make their wealth known with a nonverbal cue: the color and heft of their credit card.

A since-deleted Reddit user wrote in the viral thread how wealthy individuals will often receive great service from staff once the staff sees their credit card. Another user named illinois_smith confirmed they were a service industry worker and the nice credit cards do get noticed, especially the ones made of heavy metal.

Getting these specific credit cards typically requires a certain amount of heavy spending from the cardholder. The number of people given these cards will often be pretty limited as well.

The Ultra-Wealthy Take Portfolio Diversification to the Next Level

Those with great wealth have several assets, tangible and intangible alike, which make up their overall investment portfolio. Popular physical assets include real estate, jewelry, rare artwork, vintage vehicles and cash or cash equivalents like money market mutual funds. Less intangible assets include stocks, bonds and exchange-traded funds (EFTs).

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

https://news.yahoo.com/5-things-millionaires-money-normal-200024351.html

Money Lessons From The White Lotus

Money Lessons From The White Lotus

Posted December 16, 2022 by Ben Carlson

I loved the first season of  The White Lotus It was the perfect pandemic show at the perfect time, allowing us to escape to an exotic locale and enjoy the quirks of some wonderfully written characters.

Season two just wrapped on HBO and I enjoyed it even more than the first one.

The murder mystery aspect of the show was tremendous but my finance brain couldn’t help but notice a number of money and behavioral psychology lessons from this season’s cast.

I know what you’re thinking: Ben, these are TV characters. Are you really going to do this?

You’re xxxx right I’m going to do this.

And creator Mike White even said in an interview all of these characters are based on people he knows or has interacted with in the entertainment industry. The show was satirical but nailed a lot of tried and true money truths.

Here are some of my favorites from The White Lotus resort in Sicily:

[WARNING: SPOILERS GALORE TO FOLLOW]

Keeping up with the Joneses can get you into trouble in a lot of different ways. My favorite dynamic on the show was the interplay between two couples traveling to Sicily together — Ethan & Harper and Cameron & Daphne.

Each married couple was unhappy in their own way.

Ethan and Cameron were old college roommates but Cameron hit it big first, making some dough as a finance bro.

Just before their getaway, Ethan and Harper earned untold millions selling his tech firm. They told themselves the money wasn’t going to change them but earning a big payday does change how other people perceive you.

Caeron told Ethan once you become fabulously wealthy, it’s OK to cheat on your wife:

Cameron: Now, that you’re a big shot, people must be slipping into your DMs left and right.

Ethan: No. What good would it do me if they were? I mean, I’m married.

Cameron: Dude, everyone cheats, E.

Ethan: No, they don’t. Come on! They do?

Cameron: Yeah!

And even though his big payday gave Ethan more money, he was in constant competition with his old roommate.

Newfound wealth led to jealousy, resentment, trust issues, cheating and more baggage than Tanya brought with her to the resort.

A lot of people assume keeping up with the Joneses is all about spending more money to keep up. That is part of it but it can also change your behavior in ways you might not appreciate.

More money might not change who you are but it changes who you think you should be and how other people think you should act.

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

https://awealthofcommonsense.com/2022/12/money-lessons-from-the-white-lotus/

16 Money Rules That Millionaires Swear By

16 Money Rules That Millionaires Swear By

Gabrielle Olya  Fri, December 16, 2022

Being a millionaire or billionaire -- especially a self-made one -- usually requires being disciplined about saving and spending, as well as investing wisely. Although the super-rich can splurge on lavish vacations and fancy cars, some eschew a luxurious lifestyle for one that allows them to maintain their wealth over the long term.

So, if you want to live like a millionaire yourself, you'll have to follow the money rules of the wealthy.

Kristen Bell: Take Advantage of Coupons When Shopping

Net worth: $40 million

"Frozen" star Kristen Bell still clips coupons despite her multi-million-dollar wealth.

"I almost exclusively shop with coupons," she said on "Conan," sharing that her personal favorite place to shop with coupons is Bed Bath & Beyond. "It's the best one because they've got 20% off, and if you go and buy a duvet or an air conditioner or whatever, you could be saving upwards of $80."

Sara Blakely: Create and Maintain a Nest Egg

Net worth: $1 billion

Spanx founder Sara Blakely kept her day job while starting her shapewear company to make sure she'd be able to maintain a healthy nest egg.

"It's really important to save money and create a nest egg, become comfortable for yourself with what the nest egg is, and don't touch it," she told Business Insider. "Leave it there. I always had a portion of my paycheck put into savings, and that was an easy automatic way ... I didn't quit my job until I'd already landed Neiman Marcus and Saks Fifth Avenue. I was so careful, I [worked on Spanx] at night and on the weekends because I didn't not want to have income coming in."

Warren Buffett: Think of Investing as a Long-Term Strategy   Net worth: $99.8 billion

Billionaire investor Warren Buffett isn't a proponent of active stock trading.

"When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever," he wrote in his 1988 Berkshire Hathaway shareholders letter. "We are just the opposite of those who hurry to sell and book profits when companies perform well."

Grant Cardone: Save $100K and Invest the Rest   Net worth: $600 million

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

https://news.yahoo.com/16-money-rules-millionaires-swear-171052150.html

How to Create Your Estate Plan: A Checklist

How to Create Your Estate Plan: A Checklist

Follow these steps to tackle this daunting task.

Christine Benz  Nov 30, 2022

“Estate planning” is off-putting on so many levels. “Estate” conjures up images of the uber-wealthy setting aside giant tracts of land for the next generation. (Do I even have an estate, you wonder?)

And once you delve deeper and find out that estate planning revolves around organizing your affairs in case of your death or incapacity, the project sounds even less compelling than cleaning the gutters or shredding those giant piles of paperwork that have been accumulating in your office. Then there are the costs: Properly drafted estate plans usually involve attorneys, and they like to get paid for their services.

So, that’s a potentially costly exercise that involves contemplating your demise and may be mainly for rich people anyway. Is it any wonder that so many people put off estate planning, and less than half of the U.S. population has drafted a will?

The good news is that you’ve probably already done a little bit of estate planning; you just may not be aware of it. If you’ve designated beneficiaries for your retirement accounts, you’ve started the estate-planning process. Ditto if you’ve picked a guardian for your young children—even if you’ve not yet formalized it—or compiled a list of all of your household’s liabilities and assets.

8 Steps to Start Your Estate Plan

It’s helpful to think of estate planning as a process, rather than something that’s one and done and begins and ends in an attorney’s office. Crafting an estate plan involves a series of steps, some of which you’ve probably already undertaken and are probably going to need to revisit as your life unfolds.

As you do tackle your estate plan, here are the key jobs to check off your list:

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

https://www.morningstar.com/articles/817462/how-to-create-your-estate-plan-a-checklist

9 Bills You Should Never Put on Autopay

9 Bills You Should Never Put on Autopay

Dec 15, 2022  By Valencia Higuera

We can all use a simpler, more efficient way to manage expenses and save money. Putting your bills on autopay can ensure never forgetting a due date, which minimizes the risk of late fees and dings on your credit report. But although automatic payments can save time and streamline your personal finances, it isn’t the right choice for every expense.

Autopay is ideal for payments which don’t fluctuate every month, such as your mortgage and car payments. You know what to expect from these bills, so it’s easier to plan and budget for automatic drafts. This isn’t the case with monthly expenses that fluctuate. Before you get excited and put your entire financial life on autopilot, here are some bills you should never put on autopay.

Cellphone

If you have an unlimited cellphone plan and your bill never varies, autopay is a time-saving strategy for managing payments. There’s also the option of setting up automatic payments for a non-unlimited cellphone plan. The problem, however, is the amount you owe can change from month to month, depending on data usage. And if you forget to read your cellphone statement in months where you owe more than usual, the extra funds taken from your bank account could trigger an overdraft and bank fees.

Some cellphone plans also don’t have the same billing date each month. While you might have a set date — say the 15th — others have a monthly cycle which varies depending on the number of days in the month. This doesn’t guarantee a consistent payment date each month. You could be caught off guard, or out of funds, if a payment posts when you weren’t expecting it.

Since autopay is a hands-off approach to paying bills, you’re also less likely to inspect your cellphone bill after setting up automatic payments. This means you might not catch billing errors and will pay more than necessary.

Utilities

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

https://www.gobankingrates.com/saving-money/budgeting/bills-should-never-put-autopay/?utm_term=related_link_1&utm_campaign=1197538&utm_source=yahoo.com&utm_content=2&utm_medium=rss

7 Things You Should Never Pay For With Cash

7 Things You Should Never Pay For With Cash

Jennifer Taylor  Wed, December 14, 2022

Some people charge everything to a credit card to rack up rewards points, but that isn’t your style. When possible, you prefer to pay with cash. Maybe you’ve ditched the plastic as a way to curb overspending, avoid credit card fraud or simply because you prefer to shop off the grid. However, despite the many good reasons to pay with cash, it isn’t always the best choice.

Not sure what types of purchases warrant leaving the cash in your wallet? Here’s a look at seven common payments that should always be made with a different form other than cash.

Rent

Writing a check can be a hassle, so if you don’t have the option to pay your rent online, you might opt for cash. However, William Capece, CFP, director of business development at the JS Benefits Group, said doing so is unwise, because it leaves you without a paper trail.

“Too often we hear stories of landlords who evict tenants over unpaid rent, while the tenant swears to have paid,” he said. “Cash leaves no paper trail and thus no proof.” On the flip side, he said landlords should also never accept cash payments for the same reason. “This should be outlined in the renter agreement,” he said.

Car

Since interest rates are at historic lows, Capece advised against buying a car with all cash. “Utilizing a car loan helps in many ways,” he said. “Dealers make more money when customers utilize debt, so they are more likely to give you a better deal.”

Beyond that, he said paying for such a large purchase in cash limits your ability to invest. If you can swing it, he recommended financing your car purchase and using the cash as the down payment on a rental property. “Use an appreciating asset to pay for your lifestyle,” he said.

Home Maintenance and Updates

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

https://news.yahoo.com/7-things-never-pay-cash-120012133.html

6 Money Resolutions To Get Your Finances on Track for 2023

6 Money Resolutions To Get Your Finances on Track for 2023

Jenny Rose Spaudo  Tue, December 13, 2022 at 5:28 PM·4 min read

Have you thought about your financial New Year’s resolutions yet? If not, now is a great time to start. Over 27% of American adults say saving more money is their top financial goal for 2023, according to a recent GOBankingRates survey. Around 23% plan to get out of debt, and another 23% want to make more money.

What practical steps should you take to reach your goals next year? Here are the top money resolutions financial experts recommend if you want to get your finances on track in 2023.

Set a Budget To Achieve Your Goals

Hoping to save enough for a big purchase next year? GOBankingRates found that over 40% of adults are planning to buy a car in 2023, more than 26% expect to take an expensive vacation and around 24% would like to buy a home.

To reach your savings goal, though, you’ll need a budget, said Jay Zigmont, CFP and founder of Childfree Wealth. Creating and sticking to a budget throughout the year can help you stay on track with your savings and avoid overspending.

“It doesn’t matter if you follow a cash-stuffing approach, use an app, or just put it down on paper,” Zigmont said. “You just need to have a plan for your money each month. Your first month of budgeting won’t be perfect, but the key is to keep at it and keep making improvements.”

Pay Off Your High-Interest Debt

Many financial experts will tell you that, although not all debt is harmful, high-interest debt can quickly put a strain on your finances. According to a 2022 GOBankingRates survey, over 31% of American adults have more than $1,000 in credit card debt.

Paying off these debts can free you to invest, save and enjoy more of your money. Start by making sure you understand all the terms and conditions of your current loans, said CPA and finance coach Tatiana Tsoir. Try to make this a habit before taking on any new debts, too.

“Many people don’t understand the terms of their credit cards, bank accounts, loans, or cash advances,” she said. “Know what you’re getting yourself into and whether it’s going to help or hurt your financial situation.”

Contribute To a Retirement Account

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

https://news.yahoo.com/6-money-resolutions-finances-track-235224567.html

One-Third of Americans Say Inflation Is Top Stressor Going Into 2023

One-Third of Americans Say Inflation Is Top Stressor Going Into 2023 — How To Not Let It Get You Down

By Ashleigh Ray  December 12, 2022

The holidays are rapidly approaching, meaning 2023 will be here before you know it. While a new year always brings with it feelings of hope and optimism, there’s also a lot of uncertainty and concern surrounding the economy. The rising costs have had a significant impact on everyone, forcing budgets to get tighter and tighter.

A recent GOBankingRates survey found that a third of Americans (33%) say inflation is their number one stressor going into 2023. You can see this especially when you consider the two thirds of people who say rising food and gas costs impacted their finances the most this year.

Aside from inflation, 23% of Americans say their top stressor going into 2023 is living paycheck to paycheck, and another 20% are most concerned about debt. Inflation seems to have taken quite the financial toll on American wallets, but you don’t have to let it get you down. Here are some ways to prepare your finances for rising costs in the coming year.

Try To Cut Back Where You Can

On your next trip to the grocery store, see if you can switch out some of your name brand products for the generic brand. While it might only save you cents in the moment, those savings will add up over time. If you continue to find small ways to cut back, you’ll be able to give yourself a little more breathing room in your budget

Stick To Your Budget

No one’s sure when prices will stop increasing at the rapid rate that they have been. With that in mind, it’s a good idea to keep an eye on your finances and stick to a budget that allows you to keep contributing to your savings and retirement accounts. Try seeing if there’s any expenses you could cut back on or remove entirely. While one person may want to budget for their gym membership, another person will want to budget for their high-speed internet package. It’s up to you to determine which expenses are worth the cost.

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

https://www.gobankingrates.com/money/financial-planning/inflation-top-stressor-tips/

A $0.25 TRILLION Monthly Deficit? What Could Possibly Go Wrong??

A $0.25 TRILLION Monthly Deficit? What Could Possibly Go Wrong??

Simon Black December 13, 2022

On the fifth of April in the year 1853, a diplomat from the United Kingdom with the most quintessentially British name — Stratford Canning — arrived by boat to Constantinople and immediately took an emergency meeting with Sultan Abdulmejid of the Ottoman Empire.

After decades of relative peace, Europe was once again on the brink of war. Russia was a rising power at the time, and, eager to flex its muscles, Russia threatened to invade the Ottoman Empire over completely ridiculous reasons.

Everyone knew that much of Europe would be drawn into a pointless conflict. And that’s why Britain, the dominant superpower at the time, sent Stratford Canning to try to prevent a war.

The British thought they were in good hands. After all, Canning had nearly five decades of experience in diplomacy. Certainly he of all people would be capable of maintaining peace.

Sadly for the British (and everyone else in Europe), Canning was a total failure. Not only did this man, with his five decades of experience, fail to prevent the war, but he actually escalated the conflict by convincing Sultan Abulmejid to reject Russia’s peace proposal.

Russia didn’t appreciate the rejection. And by the end of June, Russian troops invaded Ottoman-controlled territory.

This conflict became known as the Crimean War, and it was pretty much a disaster for almost everyone involved, including Russia… and especially the Ottoman Empire.

Russia suffered nearly half a million casualties from the war. They depleted their treasury and severely injured their economy. And most of all, Russia’s imperial army — which everyone had previously assumed to be among the best in Europe — was found to be second rate and poorly equipped.

But the Ottoman Empire fared even worse.

The empire was already in extreme decline by the mid 1800s. And about the only thing the Ottoman Empire had going for them economically was that they had ZERO foreign debt. That is, until the Crimean War.

In 1854, the Ottoman Empire took on its first foreign debt; the war was costly and they needed money. But once they started borrowing from foreigners, they never stopped. Even after Russia finally threw in the towel and the Crimean War ended in 1856, the Ottoman Empire kept borrowing.

Meanwhile the Ottoman economy continued deteriorating. The Ottoman government was full of self-righteous, entitled bureaucrats who harassed the private sector with mountains of regulations and debilitating taxes.

The Ottoman Empire also saw its share of bad luck. A number of pandemics swept the empire, including a nasty Bubonic Plague outbreak in 1876, which added to the government’s economic woes and forced them to borrow even more.

In fact, by 1876, the imperial government had borrowed so much money that debt service took up roughly HALF of their entire tax revenue.

More importantly, Ottoman borrowing costs had soared. They borrowed money at less than 5% at the beginning of the Crimean War in 1854. But by the mid 1860s, foreign lenders typically demanded 10% or more.

Needless to say the Ottoman Empire eventually defaulted on its gargantuan debt. And once they did, their foreign lenders took control of the imperial government and its finances; the Ottoman Empire effectively lost its sovereignty and became a client state of its European lenders.

History has no shortage of similar examples — once powerful and thriving empires who mismanaged their economies, took on enormous debts, and became weak through sheer financial insanity.

The US government seems to have willfully chosen to ignore these lessons time and time again.

Back in 2018, as the US national debt was closing in on $25 trillion, I pointed out that Treasury Department was projecting to increase the debt by roughly $1 trillion per year.

This was at a time when the economy was strong, tax revenues were at record levels, etc. There were no major wars, no financial crises, no major disasters.

And I wondered — if the government can rack up a trillion dollar deficit when everything was great, “what’s going to happen to the US federal deficit when there actually IS a financial crisis or major recession?”

Well, we got our answer in 2020 when COVID struck. They added $5+ trillion to the debt, practically in an instant, and acted like it was no big deal.

Yet even though the government claims the pandemic is over, today they’re STILL spending absurd quantities of money.

Yesterday the Treasury Department announced that the federal budget deficit for last month alone was a whopping $248.5 billion.

That’s a near quarter of a TRILLION dollar deficit. In a SINGLE MONTH.

This wasn’t a one-time anomaly either. The deficit over the past six months (June-Nov) totals nearly $1.3 trillion, an average monthly deficit of more than $200 billion.

All of this deficit spending adds to the national debt, which, duh, eventually needs to be repaid.

Whenever the Treasury Department borrows money to pay for these outrageous deficits, they do so by issuing bonds. And those bonds are sold to investors with terms ranging from 28 days all the way up to 30 years.

The average maturity for US government debt is about five years. This means that, every year, roughly 20% of US debt matures and needs to be repaid.

Naturally the government doesn’t have the money to repay its debts. So instead they borrow new debt to repay the old debt. It’s basically a Ponzi scheme.

To make matters worse, interest rates have been rising rapidly; last year the government borrowed money at 0.1% or less. But today they have to pay 4% or more.

That’s a huge difference.

Thanks to rising rates, the US government will spend nearly $1 trillion this fiscal year… just to pay INTEREST on its debt. And if rates keep rising (or remain this high), that figure will only grow as they continue to refinance their debts.

History shows that it’s very difficult to remain a superpower when you have to spend vast sums of money just to pay interest.

And yet the people in charge remain completely oblivious to this fact… and pretend like absolutely nothing could go wrong.

This is plenty of reason to have a Plan B...

PS: If you can see what is happening, and where this is all going, you understand why it is so important to have a Plan B. That’s why we published our 31-page, fully updated Perfect Plan B Guide, which you can download here.

To your freedom, Simon Black, Founder  Sovereign Research & Advisory

https://www.sovereignman.com/trends/a-0-25-trillion-monthly-deficit-what-could-possibly-go-wrong-144706/

How Long Should You Wait To Remind Your Friends To Pay You Back?

How Long Should You Wait To Remind Your Friends To Pay You Back?

By Nicole Spector  September 3, 2022

It can start out so innocently: a friend asks you to spot him some cash. Maybe it’s a fairly trivial amount — a $20 for his share of brunch, say. Or perhaps it’s a tad more substantial: $100 to tide him over until he gets paid. Or maybe he asks for $500, $1,000 or more.

And he’s your friend, and he’d do it for you, right? And you have the means…

“Like they sing about in the Friends theme song, friendship is about being there for each other, and this can sometimes mean being there financially,” said Anthony Martin here, founder and CEO of Choice Mutual. “We all need a hand sometimes; you may find yourself in a position to spot your friend for a few meals or even assist with a slightly larger financial burden like overdue rent or a car payment.”

So you lend him the money. Key word being “lend.” But then what? Well, you may make an informal verbal agreement that he pays you back in a few weeks or months. But the days pass and pass and no money is returned.

How long do you wait to nudge your friend and remind him about the money that you loaned him — and that it’s time to pay you back?

It Depends on What You Agreed Upon

“Reminding them to pay you back really depends on your original agreement,” said Craig Miller, a psychologist and the co-founder of Academia Labs, LLC. “For instance, if your friend borrowed money from you and promised to pay you back after a month, then the first reminder for payment should come after a month. If your friend is able to pay already, then well and good. If not, then your friend should indicate a specific time he’ll be able to pay. Only then can you remind your friend again for payment.”

Consider a Timetable

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

https://www.gobankingrates.com/money/financial-planning/how-long-should-you-wait-to-remind-your-friends-pay-you-back/