5 Key Signs Your Finances Are in Trouble

5 Key Signs Your Finances Are in Trouble

Crystal Mayer   Tue, August 8, 2023

If you feel like there is never enough money in your bank account, you are not alone. According to a survey conducted by the LendingClub Corporation and PYMNTS.com, 64% of adults in America reported living paycheck to paycheck in March 2022. Millions of people are unable to get ahead or put money aside for savings, meaning that they may be struggling financially.

When you are in the middle of it, however, it can be challenging to determine just how dire your financial situation is. You may have become numb to the fact that you routinely pay bills late or are swimming in overdraft fees. Many people simply have no other choice, given that wages have not kept pace with the high cost of living in most areas. But recognizing that your bank account is not healthy is half the battle, so here are five key signs your finances are in trouble.

You Are Late or Miss Your Monthly Payments

One of the most telling signs that you may be spending more than you make is if you regularly miss payments or even if you have to pay them past the due date. If you cannot make payments on time, your credit score will be negatively impacted.

As your credit score drops, you will get less favorable lending terms making it more expensive for you to buy a car or home. In some cases, you may not qualify at all. If you find yourself missing due dates, you need to evaluate your spending habits. Start by writing down all of your income and expenses. See if there are ways that you can cut back to ensure that you pay your monthly bills on time. Set the bills on automatic payments to ensure they are made in a timely manner.

You Live Paycheck to Paycheck

If you are one of the 166 million that live paycheck to paycheck, you may be in more financial trouble than you realize. Living paycheck to paycheck is not only stressful, it is not sustainable. One emergency, such as a car wreck or job loss, could spell financial ruin.

To get out of the habit, determine if you are living paycheck to paycheck because you spend beyond your means or if it is that you truly cannot afford even a modest lifestyle. If you spend a lot of money on nonessentials, then you should be able to cut back and put money into savings. If your paycheck strictly goes toward the basics, you might need to consider relocating to a less expensive area or taking on a side hustle.

You Don’t Have an Emergency Fund

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

https://www.yahoo.com/finance/news/5-key-signs-finances-trouble-120008832.html

What to Know About Hidden Fees That Increase the Price of Everything

What to Know About Hidden Fees That Increase the Price of Everything

Farnoosh Torabi  Aug. 21, 2022

What's happening

Many companies have found ways of passing down increased costs to consumers, with extra charges tacked on to your bill at checkout.

Why it matters

It's called drip pricing, and these new fees and surcharges are affecting customers who are already struggling with rampant inflation.

What's next

Knowing what merchants are charging can help you manage your budget and make better buying decisions. The prices for nearly everything have ballooned in the past year. Record high inflation means the cost of food, fuel and other everyday essentials has gone up, which has put severe financial pressure on US households, particularly low-income Americans.

Look out for surcharges like these on your restaurant bills. Courtney Johnston/CNET

And then there's the hidden costs added to your purchase before checkout, or tacked on to the receipt without warning. These additional merchant fees are called drip pricing, and they're inflicting pain on our already-stretched wallets. Businesses often claim these fees are the only way to offset the burden of inflation and supply chain shortages. For consumers, it means the things we buy are pricier than they initially appear.

"Most of the time we find out about these fees when it's time to pay, not before," Ashley Feinstein Gerstley, author of Financial Adulting, told me via email. "Because these fees really run the gamut, you never really know what you are going to get."

I asked my Instagram followers about these new and surprising fees, and they gave me loads of anecdotes. From restaurants to medical offices to rideshare services, here's a look at some charges that I discovered. And I'll offer tips on how to manage these unexpected surcharges.

Restaurants are charging more, and not just for food

Many restaurants are still reeling from a fiscal slump during the first year of the COVID-19 pandemic. Now, with rising food and payroll costs, eateries continue to struggle. "Average small business restaurants run on very tight margins of around 3 to 5% pre-tax," said Hudson Riehle, senior vice president of research with the National Restaurant Association. "The typical restaurant business model is not set up to deal with this sustained and accelerated cost of food and labor, which is putting extraordinary pressure on operators, and indications are these will continue."

Here are some of the new fees you may see on your restaurant bill:

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

https://www.cnet.com/personal-finance/banking/what-to-know-about-hidden-fees-that-increase-the-price-of-everything/

How Much is it Costing Your Business to Accept Paper Checks?

How Much is it Costing Your Business to Accept Paper Checks?

Mar 17, 2023 by Zazil Martinez

Paper checks are one of the most costly ways to collect payments. Still, many businesses think getting paid by check is the most affordable method. In 2021, 91% of organizations across the U.S. continued to receive checks, even though they understand the associated costs and risks.  Of course, there are also many indirect costs to check processing, such as labor and processing fees. The bill can quickly eat into your bottom line — and that's before potential errors.

It's no wonder businesses have been shifting from paper checks to digital alternatives that offer more convenience, data, control, and automation. The 2020 pandemic only accelerated the shift as consumers demanded contactless payments.

Ditching paper-based payment methods can help companies cut costs by reducing the amount of manual work and payment fraud risk. In most cases, the solution will integrate with your ERP, making it easy for AR teams to navigate.

Let's explore what it costs your business to accept paper checks and alternative payment options.

 The Real Cost of Writing Paper Checks

Paper checks are 10x more expensive for businesses than digital payments as there are more than processing fees to consider, such as workforce and incidental costs, which are not included when processing payments via digital alternatives.

Based on the check price and postage, Bank of America estimates that a check can cost anywhere from $4 to $20. That's without considering the time your finance team spends writing, mailing, collecting, and reconciling checks. The Wall Street Journal reports businesses can spend up to $25k on materials, staffing, postage, and bank fees.

We ran the numbers to have a better idea of what this looks like in practice. Here's a breakdown of what it would cost your business to process an average of 5,000 checks per month:

https://www.paystand.com/hs-fs/hubfs/Slide - Deconstructing the Costs of Paper Check-1.png?width=880&name=Slide - Deconstructing the Costs of Paper Check-1.png

And from an AR perspective, if some of those checks bounce, things can turn ugly pretty fast. If you deposit a check that bounces, you can add in a returned check fee along with the headache of collecting the money you're due.

Processing paper checks is more than just expensive. It also slows your payment processing workflow down. This can increase your DSO and impact your cash flow.

These manual processes are no longer necessary thanks to digital payment solutions. With ERP integration, you can receive payments in minutes. The best part? Depending on your payment solution, you won't have to pay any transaction fees.

5 Common Payment Myths About Accepting Paper Checks

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

https://www.paystand.com/blog/how-much-does-it-cost-business-to-accept-paper-checks

What Is the Banking Crisis of 2023? Is It Over?

What Is the Banking Crisis of 2023? Is It Over?

Laura Rodini updated: Aug 7, 2023 original: May 25, 2023

Banks have been hit by the one-two punch of rising interest rates and a sluggish economy, but the failures at Silicon Valley Bank, Signature Bank, and First Republic Bank may not be the only banking catastrophes to happen in 2023.  2023 may go down in the history books as the year America lost faith in its banks. 

Over the course of a few weeks in the spring of 2023, multiple high-profile regional banks suddenly collapsed: Silicon Valley Bank (SVB), Signature Bank, and First Republic Bank. These banks weren’t limited to one geographic area, and there wasn’t one single reason behind their failures.

The news roiled the financial markets, pummeled the banking industry, and unsettled the public. Fears mounted that financial contagion was underway, which happens when a problem in one sector spreads to other areas of an economy, country, or region—with disastrous consequences.

But what exactly had happened to these banks? Why did they fail this year and not during the COVID-19 pandemic, when so many other businesses shuttered?

And perhaps the most important question of all is: Has the banking crisis of 2023 ended?

Why Do Banking Crises Happen?

Here’s the setup: Smaller banks have long been considered to be the backbone of America—with strong ties to their local communities, they have the boots-on-the-ground expertise Wall Street institutions and monoliths like JPMorgan Chase simply can’t offer. According to Goldman Sachs, small banks are responsible for 70% of all small business lending. Small businesses make up a critical component of U.S. GDP, comprising nearly half of the nation’s workforce.

Before the Federal Reserve Act, in the Wild West days of the U.S. financial system, states chartered banks, and they were limited to just one branch. It was a scene straight out of It’s a Wonderful Life: Every little town in America had a town hall, a church, and a bank.

By the 1920s, there were nearly 30,000 banks in America.

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

https://www.thestreet.com/banking/american-banking-crisis?puc=yahoo&cm_ven=YAHOO

Bank Failures: How to Keep Your Money Safe

Bank Failures: How to Keep Your Money Safe

BY PRIYA KAPOOR • APR 6, 2023

SVB's collapse didn't just affect American depositors, but also many Indian start-ups. Hundreds of Indian startups with millions of dollars in their accounts found themselves stuck.

SVB's failure was the second largest in US history and the largest since the financial crisis of 2008

On March 11, 2023, the US President Joe Biden was seen reassuring Americans that their money in banks is safe and the American banking system is strong. This was following the news of the collapse of Silicon Valley Bank (SVB) and Signature Bank. The banks were shut down by the US regulator. Before being closed, SVB Bank was the 16th largest lender. It had $209 billion in total assets, while Signature Bank had $110 billion as of December 2022.

What went wrong?

SVB invested in debt like the US treasuries and mortgage backed securities, but as the US Federal Reserve began to increase interest rates to contain inflation, this reduced returns for banks and the value of SVB's investments fell. Amidst venture capital money drying up, clients rushed to withdraw funds, leading SVB to sell assets which created $1.8 billion in losses. The incident spooked the customers of Signature Bank as well who rushed to withdrew large sum of deposits. The run led to its failure.

Many Indian start-ups affected

The collapse didn't just affect American depositors, but also many Indian start-ups. Hundreds of Indian startups with millions of dollars in their accounts found themselves stuck. The fear and panic reflected in the share prices too. The shares of the mobile gaming company Nazara Technologies plunged 7 percent on the day it informed stock exchange that the two of its subsidiaries together had more than $7.75 million in balances at the failed bank.

However, the company now heaves a sigh of relief after getting the amount back in full. "SVB was a very reliable bank and the current situation took us by surprise. However, we have got our full money back, and we have parked it at another bank in the US," says Nitish Mittersain, Founder, Nazara Technologies.

Why did start-ups park funds with SVB?

The SVB fiasco raised an important question: What made so many Indian startups park their funds with American bank SVB in the first place and not with the bank domiciled in India. The answer lies in conditions imposed by foreign entities while agreeing to invest.

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

https://www.entrepreneur.com/en-in/finance/bank-failures-how-to-keep-your-money-safe/449144

7 Secrets of Self-Made Millionaires

7 Secrets of Self-Made Millionaires

By Grant Cardone

Learn how to generate multimillion-dollar wealth -- and enjoy the journey on your way to the top. First, understand that you no longer want to be just a millionaire. You want to become a multimillionaire. While you may think a million dollars will give you financial security, it will not. Given the volatility in economies, governments and financial markets around the world, it's no longer safe to assume a million dollars will provide you and your family with true security.

In fact, a Fidelity Investments' study of millionaires last year found that 42 percent of them don't feel wealthy and they would need $7.5 million of investable assets to start feeling rich.

This isn't a how-to on the accumulation of wealth from a lifetime of saving and pinching pennies. This is about generating multimillion-dollar wealth and enjoying it during the creation process. To get started, consider these seven secrets of multimillionaires.

No. 1: Decide To Be A Multimillionaire

 You first have to decide you want to be a self-made millionaire. I went from nothing — no money, just ideas and a lot of hard work — to create a net worth that probably cannot be destroyed in my lifetime.

The first step was making a decision and setting a target. Every day for years, I wrote down this statement: "I am worth over $100,000,000!"

No. 2: Get Rid Of Poverty Thinking

There's no shortage of money on planet Earth, only a shortage of people who think correctly about it. To become a millionaire from scratch, you must end the poverty thinking. I know because I had to.

I was raised by a single mother who did everything possible to put three boys through school and make ends meet. Many of the lessons she taught me encouraged a sense of scarcity and fear: "Eat all your food; there are people starving," "Don't waste anything," "Money doesn't grow on trees." Real wealth and abundance aren't created from such thinking.

No. 3: Treat It Like A Duty

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

https://www.entrepreneur.com/article/222718

The 7 Commandments of Common Sense in the Modern World

The 7 Commandments of Common Sense in the Modern World

Hilary Tetenbaum   Mon, August 7, 2023

Common sense is a commodity. In some years, it seems to be in shorter supply than at other times. The current decade has already had its shortages and surpluses of it. Fortunately, there are several simple ways to maximize your personal account balance of the intangible asset.

Those who strive to become homeowners instead of lifelong renters already display a penchant for having a ready supply of common sense. Other examples appear among those who work to establish a solid credit score, protect personal information online, and get health advice from reliable sources. Review the following ways you can let commonsense actions and decisions make life much more rewarding and enjoyable.

Don’t Be a Lifelong Renter

With few exceptions, every working adult can benefit from becoming a homeowner. Renting is convenient but expensive. No matter how great of a lease deal you find, the money does not increase your ownership of a tangible asset. The most common route to ownership begins soon after a person lands their first adult job.

They save for a down payment, shop for properties they can afford, clean up their credit, and work with a licensed Realtor to find a house that meets their minimum requirements. The process can take several years, but it’s worth the wait and the effort. Step one is to speak with a financial planner and make a detailed list of steps that can get you from renting to owning within a year or so.

Establish a Good Credit Score

So many of life’s central achievements are related to financial stability. Establishing credit is the surest route to meeting the requirements for other major goals, like financing a vehicle, purchasing a house, paying for college, renting a car, buying a rental property, and more.

One of the main benefits of having a good credit score is that you don’t need to make large down payments on major purchases. For consumers who have no financial history or haven’t established a rating at all, it can be all but impossible to borrow money or make a large purchase of any kind.

Lenders use credit scores as a fast way to evaluate consumer requests for loan approval in dozens of categories. That’s why it’s never too late to begin working to establish and improve your personal credit score. Whether you’re invisible to the reporting agencies or have a minimal financial history, don’t procrastinate. You can take immediate action to remedy the situation and create a foundation of financial security for the future.

Protect Your Personal Information

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

https://www.yahoo.com/news/7-commandments-common-sense-modern-131301566.html

Some Clear Thinking About America’s “Downgrade”

Some Clear Thinking About America’s “Downgrade”

Notes From the Field By Simon Black Sovereign Man August 7, 2023

Last week, the credit rating agency Fitch downgraded the US national debt.  Predictably, senior officials like Treasury Secretary Janet Yellen claimed Fitch’s “flawed assessment was based on outdated data” and that the downgrade was “entirely unwarranted.”

What a joke.

Just consider the US government’s surging interest payments on the national debt — This Fiscal Year (which ends on September 30) the Treasury Department expects to spend a whopping $897 billion just to pay interest on the national debt. That’s up SEVENTY PERCENT over the past three years. It’s an unbelievable turn for the worst.

The national debt is already more than $32.6 trillion, and it’s climbing rapidly thanks to unrestrained spending.

Fitch called attention to this reality in citing the government’s “high and widening deficits”. And this doesn’t even factor in looming emergencies like the insolvency of Social Security.

The Social Security Administration itself admits that its key trust funds will run out of money within a decade... forcing the government to either default on the promises they’ve made to millions of retirees, or to engage in the largest bailout in the history of the US government.

Also factoring into Fitch’s US economic outlook is the absolute horrific level of governance in America.

Political institutions have lost the ability to cooperate, compromise, and make sensible decisions for the good of the nation.

Obvious risks are ignored until they balloon into major crises... yet politicians only implement a band-aid fix that kicks the can down the road a few more years.

Bizarrely, socialism is becoming more and more popular even though the federal government has an objectively horrible track record when it comes to spending money wisely.

And yet there is a growing contingent among voters that the answer is more government.

Another key issue denting US credibility is the rapidly deteriorating rule of law.

It’s ironic that a former President has been charged with “conspiracy to defraud the United States” by lying in order to disrupt the lawful function of government.

I’m curious why that standard has not been applied uniformly to other government officials.

It wasn’t that long ago when Senator Chuck Schumer disagreed with a Supreme Court decision and announced (rather menacingly) to Justices Gorsuch and Kavanaugh, “You have released the whirlwind and you will pay the price. You won’t know what hit you if you go forward with these awful decisions.”

Schumer’s words helped spark death threats, protests, and the attempted murder of a Supreme Court Justice. Was this not an attempt to disrupt the lawful function of government?

The same can be said of people like Fauci who told multiple lies and censored scientific debate, thus disrupting the lawful function of government during the pandemic.

Then there was Congressman Adam Schiff, who waged Holy War based on the Russian Collusion false narrative.

The investigation was full of lies and was meant to sway a Presidential election. Was this not an attempt to disrupt the lawful function of government?

This list is truly endless. But it shows more and more that the weaponization of government, from the IRS to federal police agencies, makes people less free.

Ironically, however, it’s a great time to be a criminal in America. Or simply ‘illegal’ in any sense of the word.

The immigration system is a mess, and rather than simply fixing it to make legal immigration more efficient, politicians gaslight anyone who thinks it’s a problem to have millions of people flowing across the border unchecked.

Woke prosecutors are downgrading or refusing to prosecute serious crimes; many have implemented ‘catch and release’ bail policies which immediately put criminals back onto the streets.

Yet they do prosecute good Samaritans who step up to protect themselves and others around them.

The level of lawlessness and overall disregard for basic human decency is just astonishing; we’ve all seen the videos of brazen shoplifters in California, or chaotic mobs on the streets in Philadelphia or Chicago.

Just don’t call it a ‘mob’. After several hundred teenage looters stormed downtown Chicago last weekend, the Mayor berated a reporter and said it’s “not inappropriate” to call it a mob, and insisted they should be called “large gatherings”... just like the “mostly peaceful” protests of 2020.

This level of youth crime is not surprising given that 69% of American 8th graders aren’t proficient readers. 73% don’t know math and science.

But who can blame them given how quickly math and science are being rewritten through the lens of diversity and inclusion.

While individual teachers can be amazing human beings, the same cannot be said about the bosses who control major teachers unions. The last thing these bureaucrats seem to care about is educating young people. They’re far more interested in indoctrination.

And this leads to an extremely polarized society which is hilariously ignorant about their fanatical beliefs.

I recently saw a video of a white kid being threatened because he had ‘culturally appropriated’ his dreadlock hairstyle; little did his accusers know that dreadlocks were worn by Bronze Age civilizations in Europe, and not invented by Bob Marley.

But why let truth get in the way of petty anger.

People are enraged, intolerant, and can’t seem to cope. Shootings, road rage incidents, and general violence are on the rise, and there’s very little sense of national unity.

Even a national emergency like the pandemic didn’t unify the nation; in fact, the irrational government response, nonstop propaganda, and politicization of science made people even more divided.

I’ve been writing about these issues since I started Sovereign Man more than 14 years ago. Back then it was ‘fringe’ to talk about Social Security’s insolvency, bank failures, huge debt problems in America, rising social chaos, decline in freedom, etc.

Today it’s all mainstream.

In downgrading US debt, Fitch’s arguments look like they have been taken directly out of these pages, and they’re echoed in publications like the Wall Street Journal.

All the above said, however, I think it’s also important to see all sides and be intellectually objective. Not everything is negative.

For example, the US still has a highly diversified economy with extensive capital markets, tremendous natural resources, and a deep pool of talent.

It’s curious to me that so many “experts” tend to choose one side or the other. There’s a lot of doom and gloom on the Internet, as well as mainstream voices who obsessively chant “USA #1”.

Warren Buffett is one of America’s most famous cheerleaders. Along with Joe Biden and Treasury Secretary Janet Yellen, Buffett seems dismissive of any problems in the US economy.

So which view is correct? Well, both of them.

For centuries, scientists (led by Isaac Newton) believed that light was a special particle of energy. But eventually Newton’s ‘particle’ theory of light was disproven, and scientists concluded that light was actually a wave.

It was’t until the early 20th century that physicists began to accept that light behaves both as a particle and a wave. Albert Einstein summed this up when he said,

“We are faced with a new kind of difficulty. We have two contradictory pictures of reality; separately neither of them fully explains the phenomena of light, but together they do.”

Similarly, there are two contradictory pictures of America. One is that the nation is still strong. The other is that it is in terminal decline. Just like light, they’re both right.

The ‘America strong’ reality is still valid. In fact I would argue that most of the world would still prefer US leadership over Chinese hegemony.

And despite such debilitating economic problems, I’ve written several times before that these challenges are still solvable.

There’s at least one historical instance we’ve talked about in the past of a superpower (Britain in the 1800s) that was able to grow its way out of terrible economic, social, and national defense challenges.

But I wouldn’t want to bet the house on this happening again. And that’s why it makes so much sense to have a Plan B.

Have another place to go. Take steps to reduce your taxes. Safeguard your retirement. Diversify your savings and investments outside of your home currency. Protect your assets. Etc.

That way, whatever happens, you will be able to respond from a position of strength.

To your freedom,  Simon Black, Founder   Sovereign Man

https://www.sovereignman.com/trends/some-clear-thinking-about-americas-downgrade-148001/

The Five Biggest Things That Confuse Americans About Retirement

The Five Biggest Things That Confuse Americans About Retirement

Retirement: What people say about their readiness

Kerry Hannon   Sun, August 6, 2023

Americans think they'll need to save $1.8 million for a comfortable retirement, according to a new survey. But for many of them, that’s just a shot-in-the-dark guess.  Many have no idea how much they should save or how to invest whatever money they sock away. They’re baffled by many other essential facets of retirement planning, the survey released this week from Charles Schwab showed.

That’s a real problem because what Americans save is supposed to become a major source of income in retirement, and, if they're clueless on the basics, many may under-save and face a shortfall in their old age.

"The workers we surveyed may be 5, 10, 20, or even 30 or more years away from retirement, but the gap between now and the future can make it difficult for savers to nail down specifics about what they imagine their lives will look like in retirement," Marci Stewart, director, communication consulting and participant education for Schwab Workplace Financial Services, told Yahoo Finance.

"That raises the bar on providing access to quality education and professional advice."

Here are the five biggest things that confuse Americans about retirement, according to the Schwab poll.

How much should I save?

More than four in 10 workers (41%) polled said they need help calculating how much money they need to save for retirement. In fact, a recent survey from Transamerica Center for Retirement Studies actually found that 45% of workers said they guessed the amount they need to save for retirement.

"Retirement calculators are widely available online and they are great tools to help people get a sense of whether they are on track," Stewart said. Check out AARP, Bogleheads, Fidelity, Schwab, or Vanguard to start.

Plan on some soul-searching and sleuthing.

"Consider what you need to enjoy the life you want to in retirement,” Liz Davidson, CEO and founder of Financial Finesse and author of "Money Strong: Your Guide to a Life Free of Financial Worries," told Yahoo Finance. "That number may be significantly lower than what you need right now. From there, consider what income sources will be there for you in retirement, like Social Security or even a pension."

If you have a personal my Social Security account, you can get an estimate of your future monthly retirement benefits and see the impact of different retirement age scenarios from retiring right now to your full retirement age or at age 70 based on your actual Social Security earnings record. If you don't have an account yet, you can set one up on the site. You might factor in a scenario where Social Security benefits are reduced 25% compared to your estimated statement to take into account the potential for the 2034-35 estimate for depletion of the Social Security Trust Fund.

One way to boost retirement savings is to check to be sure you are saving enough of your income in your employer-provided plan to score matching funds they contribute, Davidson said.

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

https://www.yahoo.com/finance/news/the-five-biggest-things-that-confuse-americans-about-retirement-161712022.html

Nobody Told Me

Nobody Told Me

Jonathan Clements  |  February 8, 2020

I HAVE DEVOTED my entire adult life to learning about money. That might sound like cruel-and-unusual punishment, but I’ve mostly enjoyed it. For more than three decades, I’ve spent my days perusing the business pages, reading finance books, scanning academic studies and talking to countless folks about their finances. Yet, despite this intense financial education, it took me a decade or more to learn many of life’s most important money lessons and, indeed, some key insights have only come to me in recent years. Here are 10 things I wish I’d been told in my 20s—or told more loudly, so I actually listened:

1. A small home is the key to a big portfolio. My first wife and I bought a modest house, because we worried that we couldn’t really afford anything bigger. I ended up living in that house for two decades.

Financially, it turned out to be one of the smartest things I’ve ever done, because it allowed me to save great gobs of money. That’s clear to me in retrospect. But I wish I’d known it was a smart move at the time, because I wouldn’t have wasted so many hours wondering whether I should have bought a larger place.

2. Debts are negative bonds. From my first month as a homeowner, I sent in extra money with my mortgage payment, so I could pay off the loan more quickly. But it was only later that I came to view my mortgage as a negative bond—one that was costing me dearly. Indeed, paying off debt almost always garners a higher after-tax return than you can earn by investing in high-quality bonds.

3. Watching the market and your portfolio doesn’t improve performance. This has been another huge time waster. It’s a bad habit I’m belatedly trying to break.

4. Thirty years from now, you’ll wish you’d invested more in stocks. Yes, over five or even 10 years, there’s some chance you’ll lose money in the stock market. But over 30 years? It’s highly likely you’ll notch handsome gains, especially if you’re broadly diversified and regularly adding new money to your portfolio in good times and bad.

Over the past decade, I’ve upped the bond position in my portfolio, so today—at age 57—I’m at 60% stocks and 40% interest-generating investments. (The latter includes the private mortgage I wrote for my daughter.) But long before then, I spent an awful lot of time debating whether to invest more in bonds. It simply wasn’t necessary.

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

https://humbledollar.com/2020/02/nobody-told-me/

15 Most Important Assets That Will Increase Your Net Worth

15 Most Important Assets That Will Increase Your Net Worth

Jennifer Taylor  Fri, August 4, 2023

Your net worth is more than just the balance in your bank account. It's a measure of your financial health.  To get the answer to "What is my net worth?" subtract your total liabilities from your total assets. If you're trying to figure out which assets are the most valuable or will otherwise give your net worth a boost, here's a rundown of 15 critical assets. Learn how you can start making lucrative investments toward your future.

1. Owning Your Primary Residence

Homeownership ranks among the most common ways people gain a substantial increase in net worth. Instead of choosing the traditional 30-year mortgage, opt for a 15- or 20-year term, so you can pay it off more quickly, which will result in a significant asset and savings on interest. And if you decide to sell after you pay your home off, capital gains are tax-free up to $500,000, as long as your status is married filing jointly.

Renting might make more financial sense than owning in some high-priced urban areas, depending on whether the cost of ownership is reasonable in relation to total living expenses.

2. Second Home

Second homes are a savvy way to earn passive income via short-term rental platforms like HomeAway, VRBO or Airbnb. At first, you can use the extra income to help pay off your mortgage more quickly. Then, once you pay off the mortgage, you'll own a significant asset while still benefitting from the passive income of renting it out if you choose -- both can result in a nice gain in your net worth.

3. Retirement Savings

Retirement might be decades in the future, but saving now can enhance your net worth.

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

https://finance.yahoo.com/news/15-most-important-assets-increase-133014378.html