All posts by Tucker S.

www.beatingbreakeven.com

Why You Need The App Venmo Now

So if you haven’t heard of Venmo, stop reading and look it up right now. What do you think? Every one of us millennials should be using Venmo all the time. Venmo is a practical smart phone app that allows for friend groups to keep track of finances and pay each other back instantly. Venmo is linked directly to a bank account of choice, allowing for rapid money transfers from account to account with a click of a button. Just think about how much easier this will make your life. An app like this takes the awkwardness out of IOU’s and the ‘you owe me this from god knows how long ago’ situations. With Venmo, you can split bill with your buddies, break up grocery costs with your roommates, taxi fare, drinks, dinners, shopping etc. There is even a part of the app that lets you request money owed. This is like a virtual IOU reminder for your friends letting them know how much they owe. Having Venmo is like having electronic cash right in your pocket, and the best part, payments can be accurate, down to the exact cent.

Although Venmo may not directly save you any money, considering the fact that being a mooch is no longer an option, it does allow you to be more responsible with your finances. Another benefit to the electronic component of the payment system is that all transactions are listed on your online banking account website, making spending tracking easy, especially when using mint.com as well or other budgeting resources.

Another great feature of the app is it links to your Facebook account as well. This means that there is a social component to your account as well. With every transaction you are able to send a message or details of the payment that can be posted publicly or kept private. Usually my roommates and I try and one-up each other with how ridiculous and funny we can make our comments. Facebook also makes it easy to find the people you need to pay back because your Facebook are also your Venmo friends.

Venmo will save money in the long run and allow you and your friends to be more stringent. You can keep tabs on your electronic finances. When everyone has the app, paying the bill is only as hard as drunk-texting. And we millennials have gotten very good at that. So go, download this app if you don’t already have it. You won’t regret it.

How The “Little Things” Can Control Your Financial Health As A Millennial

The other day I was in my apartment after a long workday and the Internet was down. Seeing as though I didn’t have much else to do without our beloved muse, I decided to re-watch one of my favorite movies: “Vanilla Sky.” For those of you who have not seen the film (shame on you), Tom Cruise gets in a horrible accident and is left with a deformed face. He must then go through life wearing a mask, reinventing his identity and hiding himself from his former life. The movie ends with a quote that I will never forget, “the little things in life…there’s nothing bigger, is there? In the context of the movie, Cruise’s character was referring to all the little moments in life that add up and can bring you happiness. While this is definitely true, I also think it can be applied in other areas of life, such as your finances! 

It’s the little things expenditures in life that add up and can lead to the biggest sum of debt. It’s the Starbucks, the fast food, the taxi rides, the drinks, the hair products, toothpaste, the gum or the dates that you pay for and buy every week that add up. Compared to more serious investments like your monthly rent, these expenses don’t seem very damaging to your wallet, but over time these costs combined can be very detrimental. 

What’s a couple bucks here and there? A couple of bucks here and there is $3,000, 5,000 or 10,000 dollars worth of small instant gratifications spent over a year. One thing you can do to prevent these small costs from getting out of hand is to plan ahead and budget exactly how much you have spent in the past, over a certain time frame. I’m predicting the results will blow your mind. Just the other day I was looking at some of my daily spending habits. Every day I get breakfast for about $4.50. Multiplied by 261 workdays in a year, I am spending $1,174.50 on a breakfast that could cost me $0.75 if I prepared it for myself at home. Lunch was even more costly, at a daily rate of around $9, meaning I have been spending $2,349 a year. If I cut that down to $3 a day, I could save $1,566 a year. Taking this out of your yearly salary on an annual basis makes that delicious lunch much less tasty. 

Every day I see some of my co-workers take their twice-daily trips to Starbucks. If we are saying on average a Starbucks order costs $3- $4, so x2 can be as much as $7-8. This then equates to $2,088 a year. Is it really the coffee they want? Especially when we have a Kurig machine right in our break room providing the office with FREE COFFEE in over 15 different flavors. Now some of this can be justified with needing a break from work and a friendly ritual with co-workers, but the point I am trying to emphasize is that you should really consider just how necessary these small purchases are in your life or if there are ways you can cut down on your spending with cheaper alternatives. If you want to be financially successful throughout your life you need to always be analyzing your wants over your needs. Do I really need this or do I just want it? 

A good way to counter this mentality is to focus on the why you are spending so much money on these things and if you can do without them in your life. Try to find substitutes if possible with smaller unit prices. If you’re out of college, maybe you want to buy your first car, a trip or a house in the near future. Setting larger goals will help detract from spending so much on the smaller stuff, especially after you have realized just how much every dollar counts. Staying away from instant gratification purchases will make you happier and more successful in the long run. Just remember that its the little things you buy that can be the biggest threat to you’re financial health, so always be aware!

So you want to be Rich? 9 tips to get you started

The other day I read a fact on the internet: “The middle class today is 20% poorer than the middle class 30 years ago, in 1984.” At first I was startled by this statistic, but then I thought about it more. It all started to make sense to me. I thought about money… how money in this day and age, has become such a taboo topic. It’s like, we sit around looking at Instagram and Facebook photos of everyone flashing their wealth or attempted portrayals of lives they want to appear to be living. Money is a tool, and while it may seem to cause more problems than good, we all want it. If you are serious about obtaining this tool, as we often don’t like to admit, continue reading. I have compiled a list below of tips to help you take yourself more seriously and make more money.

1. Go where the money is. Wealthy people don’t become wealthy by staying in one place, simply hoping to win the lottery. You have to be proactive by relocating yourself to areas where larger influxes of money are more common. Money breeds money, it’s a natural fact of life. So if you want to increase your chances for making some, you first have to find where it is being made.

2. Don’t show off. Showing off your money is for people who either don’t have it or have just come into a lot of it too quickly—new money, for lack of a better term. As I’ve mentioned previously (and will continue to mention) investing your money is key! Yes, while it may be a fun drunk activity to try to impress girls by buying bottle service in meatpacking with your $10k bonus, but everyone sobers up eventually and you want your money to be there when you do too. Be smart, and let your money work for you in the future. Whether it be investing in your 401k or in a small business venture, both options have a greater return value than a one-night stand with a social climber.

3. Show up. Another quote for you today: “80% of success in life is just showing up.” Even when it’s a struggle, you don’t want to miss a day taking a step toward achieving your goals. Perseverance is very important, even when you feel discouraged. In sales they use the phrase “pounding the pavement” to represent this idea. This means physically going out and making sales happen, shaking hands and kissing babies… basically doing whatever it takes to get ahead. Keep this in mind. Alcoholics don’t go to one AA meeting and call themselves sober. It takes time and effort. Always show up.

4. Find a mentor. If you don’t know how to make money on your own, there are plenty of people out there who do. Network and ask successful individuals for advice and guidance. A lot of times people will be more willing to help out than you might think, or they might have other connections that may lead you to future job opportunities or business ventures. Remember money breeds money.

5. Avoid debt when there is no return on the charge. My father once told me “don’t put it on your credit card unless it will pay you back or last you for more than a few months.” He was right. Only invest with money you don’t have if it’s going to pay you back the same amount or more. Do not ever put yourself in a position where you have to work for your money. You always want your money to be working for you. So be smart, invest wisely, and think thrice about what you are swiping your credit card for.

6. Shoot big. So you want to be wealthy!? Instead of aiming for $1 million, aim for $10 or $20 million dollars. Lofty goals will keep you hungry and make you less likely to settle after your first big paycheck. Many people stop working hard after they feel comfortable enough. This is why lottery winners never stay millionaires for long. If lotto winners had a financial savvy mindset (side note: they likely wouldn’t be playing the lottery in the first place), they would invest their money. And the disappointment that 80% go bankrupt after a few years (fact), would not exist.

7. Understand that Money doesn’t sleep. Just like the Michael Douglas in the classic Wall Street. You have to be a hard worker. Even though your job ends at 5pm, this does not mean the opportunities to make more money do as well. Opportunities to make more money are always arising, day or night, you just have to go out and find them.

8. Treat money like its a girlfriend. Keep a close eye on your wealth and money. If you don’t make your money your number #1 priority, it is going to leave you and walk right into the hands of someone else. So don’t ignore money because after a while it will end up ignoring you.

9. If you want to be rich avoid embracing the idea of being poor. If you want to truly be happy, this does not make sense. Yes, yes I know the saying that goes something like “it’s not about they money, it’s about being happy.” Well let’s be honest for a brief moment here. Whoever said that, definitely did not live in our generation. Money can bring you a lot more happiness than financial insecurity. No matter how happy you think you are, nothing is worse than not knowing when your next meal will be or how you will make next months rent. Stress resulting from financial insecurity can make even the most optimistic person unhappy. Money gives you more freedom in life… freedom to live how you want to live. As selfish Americans, we know how important our freedom is.

Be A Wolf And Ace That Interview

A good interview has the power to change your career, the power to change your life. When I first started looking for a job, I was living at home in Vermont. After multiple months of networking and resumé forwarding, I received a phone call from a mutual connection that informed me there was a position opening at a bank in New York City. Despite my initial interest in Boston, I accepted the interview offer. This was an opportunity I could not pass up, the real deal. Two days later I was on a plane that was landing in JFK.

This wasn’t my first job offer or even my first interview. I knew the general expectations and had memorized a few “go to” questions, in case any awkward silences crept into the conversation. However, I had a feeling this interview would become a pivotal point in my career and my life. I knew I had to prepare much more thoroughly for this than I had ever done before. Since I am currently working at this bank, my gut tells me my preparation paid off. Below I am going to share with you some of the steps I took to ensure a smooth interview and to increase the likelihood of nailing the job interview.

The overall picture: The reason a company is interviewing you is because they want to see if you are mentally capable of holding an intelligent conversation with someone that you have never met. Now the added pressure doesn’t help this situation. Bottom line though, a person who works well under pressure demonstrates the capacity to work diligently enough to handle a difficult job.

Your resumé needs to be impeccable. End of story. I had over ten people analyze and spellcheck my resumé before I even started interviewing or forwarding it to anyone. There are no excuses for mistakes. When finalizing your dictation, perspective is important to remember. The person reading your resumé will be reading hundreds of other ones just like yours. After getting bored, it is likely they skim more quickly over the wordier ones. Stand out and impress your potential boss by describing your experience as sophisticatedly as possible, using the least amount of words.

Dress: If you’re a guy, you need to wear a suit. This is a must. Girls, you know what to do as well. You also need to have all the bases covered. These include facial grooming, quaft hair and clothing with absolutely zero wrinkles. The little things do matter now. You should try to act like you just came out of a GQ magazine article. Employers will judge you on your looks more than you would think, so don’t give them a reason not to hire you based on your appearance. I’ve talked to many employers and executives. Trust me.

Dominate the interview; show confidence while casually building rapport with your interviewer. Find a common point of interest and focus your conversation on those grounds so you can relate more easily to them. This could be something about a mutual school, club, sport or hobby that they may mention. This can also be used as a way to answer the more deep personality or experience questions they may fire at you later on.

You should be the interviewer. The employer wants to hire someone who is passionate. The best way to show passion is to be curious and ask questions. When I interviewed in New York, I researched the crap out of the industry and the company. I’m fairly certain that I asked more questions than the person who interviewed me. The night before my interview, I came up with almost 50 specific and technical questions that I could ask to show how passionate and ambitious I was. I typed them all out so they were easily accessible.  During my interview I pulled out the list and asked if I could interviewer for a little bit. I’ve heard of Ivy League grads who looked good on paper, but were eventually denied because they failed to ask questions. Don’t let this be you. Ask questions! People love to talk about themselves.

Be yourself. Remember that you are going to be working many hours at your job and people want to be around someone enjoyable and friendly. After I was hired, my boss said that one of the reasons I was appealing as a hire was because I was someone that he could easily imagine drinking a beer with or talking business outside of the office. He saw this in me more than in the other applicants he interviewed. So lastly, relax, be yourself and remember to smile too!

Interview hack for investment banking interviews: download the WallStreet Oasis interview guide. This is the only publication that incorporates real interview questions and thousands of interview insights that are shared in their company database. Reading this will help you out tons.

Finance Like A Pro: Buying A Car, What To Know

So you want to buy a car!? You’ve seen Dan Bilzerian’s recent Instagram photos and have already binge watched all seasons of Top Gear. Not only that, but you’re sick of driving your mom’s minivan to work. All things considered, it is time you had a little hot rod all for yourself. The only problem: now that you are living on your own, you have to pay for the car on your own as well. For most of you, this will be the first big purchase of your life, and this will be very exciting. One of the many milestones into adulthood is buying your first whip. While fulfilling this dream may bring you back to childhood, it will be very important to think maturely and be well informed in making this important financial decision. Below are some things you need to know before taking this step:

  • Talk to your bank about financing a car. Talking to a professional should be your first step. Being experienced with clients who have been in the same position, they can work with you to analyze your past statements and finalize a budget. You will want to know exactly what term you are able to afford, with the appropriate interest rate and how much you can fork over for the down payment. This step is crucial because in theory, as long as you are making money, you can afford any car with a loan. However, the amount you are making and/or able to pay forward will dictate just how long the term will be. In this sense, the longer the set term, the smaller the payment amount. However, the smaller the payments, the longer you are paying interest on the loan. A five year loan payment vs. a three year loan payment could be the difference of $200. This is something to strongly consider. Buying too expensive of a car may not take priority over other expenses you have to pay, no matter how long the term or how small the monthly payments. This leads me to my next point.
  • The price of the car isn’t the only cost you will have. Lest you forget you have to afford the interest, car insurance, gas and maintenance on the car to keep it running smoothly for the entirety of your ownership. When considering the cost of the car all of these factors must be remembered. Choosing a car in your price range is crucial and this price range should be determined keeping these other equally as important factors in mind. Just because all of your friend’s parents bought their kid a 3-series BMW, does not mean you can afford one yourself.
  • Car payments and loans have two parts: interest and principal. The principal is the amount you need to pay off the car or the balance. The interest is the additional cost of borrowing money. The APR is the rates, fees and other costs that come with the loan in the form of an annual percentage rate. My rule of thumb is three years; if it takes you longer you can’t afford the car.
  • When you want a loan you basically have two choices: dealership loans or bank loans. You will almost always pay additional interest if you go through a dealership. The dealer will get the loan through a bank, so they are just a middleman. That is why I suggest going straight to the source.
  • When you go see a lender, he will be assessing your credit score and credit history in order to make sure you will be able to pay off the loan. Essentially, the lender will be analyzing and predicting your future cash flows and budgets. If you have bad credit, you will likely pay higher interest rates or you may even be denied a loan. If a bad credit score is your reality, you will likely have to put a generous down payment on the car. The ability to pay a percentage upfront demonstrates to the bank that you are financially responsible which could help to lower your payments. When you are approved for a loan, the bank hands you a check to pay for the car and you will soon owe the bank a payment each month. Your new car will become what is called ‘collateral.’ In case you can no longer afford the monthly payments, the bank can seize your car to recover the money that is owed. Having the bank take your car will not only leave you riding a bike to work, but it will destroy your credit score, which will strongly decrease the likelihood of you ever being able to borrow money again. I know this sounds serious, but being a financially responsible adult is serious business.
  • Read consumer reports. In order to minimize these external expenses, you may want to consider a car that is more reliable in terms of average breakdowns or miles to the gallon. Legitimate consumer reports could help you save significantly. As long as looking at the resale value of certain cars.
  • Consider the pros and cons to buying a new vs. a used car. New cars have lower interest rates, but lose intrinsic value almost as soon as you drive the car off the lot. When the back tires hit the road, you have already lost up to a few grand. Buying a used car may mean that you can afford the quality brand you trust and essentially get more for your money. Buying new from a dealership usually means you have to pay for a salesman commission on top of the price of the car.
  • Be a savvy negotiator. The marketplace is still a marketplace, and therefore the concept of sales will apply. Many times salespeople have more leeway in terms of prices than they initially give off. These bottom line prices tend to be far below the advertised price of the car. This is important to keep in mind if you find yourself feeling pressured by a sales employee to buy a specific car. In actuality, you could put pressure on the salesman and turn things around, by negotiating and trying to get the lowest price available.

Lastly, make sure you take care of resale value, change the oil, rotate the tires, don’t drive recklessly, put a protective coat of wax on your car, and change the air filters regularly to keep mpg high. This will also save you a lot of money. So if you are buying a car, enjoy your new whip but be smart with your money at the same time! It will all pay off down the road, literally and figuratively.

 

Treat Your Life Like A Business With These 3 Statements

Businesses, like people come in all shapes and sizes. From big corporations, partnerships to sole proprietorships and LLC’s. These companies can range from businesses like Apple or Google to your sisters haircutting service or the local popcorn salesman on Main Street. You are a business, every day you make financial decisions and transactions with your finances to better yourself. You are constantly mirroring the acts of businesses all around you. Therefore, in order to be financially successful in your life you should always be thinking and acting like a business would, except instead working for a  product or service, you are in business for yourself and your product is a fulfilled life and financial security.

Budgeting with a ‘business sense’ is one of the tools that will get you there. A budget can be created by using the information from 3 different statements that businesses use everyday.  Like any business, you need to keep in touch with your accounting and finance department regularly in order to make smart life/financial decisions. This way you are aware of where your money is going and how you can make it work for you in order to get the best possible return. Using these statements or a financial tool like mint.com will help you keep track of your finances and how much you are spending and are going to spend on your “business”.

Income Statement

This is the statement that shows you your income in relation to your expenses. This statement usually is a single column report with income at the top showing your personal revenue. It doesn’t matter if the money is coming in from your job or other alternative sources of income., this just shows your inflow. The expenses are your outflow. The report will give you your NOI (net operating income) which is basically your personal profit. This will let you know if you are spending too much money. This way you can tell if you need to stop shopping in SoHo on Saturdays or buying too much late night pizza on the Lower East Side at 4am.

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(Click to Enlarge)

Balance Sheet

The balance sheet is your statement that tells you your net value at any given time. This statement breaks down your assets and your liabilities and what you physically own (equity). Here you will show your assets on the left column. These are things  like your cash, money that people owe you, your car, house, value of your investments etc. The right side has your liabilities. These are your debts, such as loans that you have yet to repay for a house or car, and/or your credit card debt. The left side is also where you put your equity. This is essentially your value or ‘net worth’. Your assets are going to equal your liabilities plus your equity. So the right side should equal the left. See below for a visual representation.

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Statement of Cash Flows

The statement of cash flows is important because this is where you are able to financially model where you will be at any given point in time.  this future value is based on certain assumptions such as how much you predict you will be making and how much you will be spending at a future point. This shows on a scale of time your income minus expenses.  It is usually a good idea to stay on the more conservative side because the future is never certain.  So it’s good to not overestimate income and underestimate expenses. Using this statement is helpful because you can see where in the future you will be able to afford more expensive things like a new car or vacation. This will keep you prepared. Click on the visual to see how this works.

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Even if you’re personal versions of these statements are on the more basic level that is okay. You are still making progress and will be more financially informed about your money. These are just power-ups to bring your budget to the next level. I would recommend updating them once a month, so you can always have an accurate sense of where you are. When finances are constantly on your mind you will be more self-aware when spending and save more money.

So you Graduated…Get a Job, and Here’s How

So you just graduated. You listened to the commencement speech, grabbed your diploma, sobered up from those nights of endless college drinking and you are hungry for the world and what it has to offer.

The only problem now is you need a job and a place to apply this thirst for success and a real paycheck. Big dreams are good at this point but you need to stay in the present moment to in order succeed. Creating unrealistic expectations can only bring disappointment . The first thing you need to do is sit down with a pen and paper and brainstorm. Its easy to just come up with stuff in your head but it can sharpen your focus if you start trying to physically map where you want to be realistically on paper. Dont fret, I was in this position one year ago. I graduated with no job and worried thoughts about what i was going to do just like you.

Here are my list of tips that i have personally found helpful during my search for a job.

  • Network. I really can’t stress this enough. You should treat yourself like a start up business and market the crap out of it. Go out of your way to meet, talk, impress and wow people around you in the field you are looking to go into. This is how you get a foot into the door. Research the industry and the different jobs you are interested in like crazy. Talk to people, be hungry and stay hungry. Your dad’s uncle’s best friend knows a guy at the company you want to work for? Pick up the phone and try to call that guy, stay in touch and check in with him every 4 days. People respond to persistence and passion. If you really want something you will make it happen, if you don’t you will make excuses. When I was starting out I went to many meetings and lunches with different bankers from large and small banks time and time again to just finish the meetings with them telling me that they didn’t have any job openings but they knew another guy at another bank that could help me out. I would shake hands, thank them for their time, and then immediately call their contact. I did this many times before finally landing an interview. It worked, because I didn’t give up. The more you network the easier it will become and the better you will be at it. Remember, you will most likely be working for someone in the baby boomer generation so  you have to relate to them by picking up the phone sometimes and not just using email or linkedIn.
  • Find a headhunter or a recruiting agency. These are people who’s main job is to find you a job. They are paid by the company to seek talent. Most headhunters will charge you nothing for their services. These are a great resource because they will set you up for interviews, and help you prepare for the interviews. They want you to get a job just as bad as you do because that is how they get paid. Even if you don’t get a job through a headhunter the whole process will help you practice for interviews and give you good experience for the jobs you do want or come across.
  • Go to networking events and in your field. these are great ways to meet people who could possibly help you find a job. from what I’ve learned working in the city is that everybody knows at least 5 people who have the potential to help you in a big way in landing a job, so you should never underestimate the power of a smile and a handshake. it can get you a lot farther than you ever imagined.
  • Don’t limit yourself to possibilities and don’t stop searching until you have an OFFER! Jobs are like girlfriends or boyfriends. Always be looking for potential matches when on the market. Just because you have a prospect doesn’t mean you should stop pursuing other opportunities. Keep the search going until you have that offer at the very end.
  • Talk to your friends who have jobs at companies, get insight on what they do and what their company is like. If you think it would be a good match ask them if they know anyone in HR that you could reach out to. Many times people get bonuses for finding talent or potential employees, so its a good incentive for both of you. LinkedIn is a good source for this as well, usually you can see where your connections work, don’t be afraid to reach out.
  • Dont rule out opportunities. I always liked the sales phrase, “It’s only weird if it doesn’t work”. This rings true because if you want a job you should be doing whatever means possible. I remember that I was on tinder one day which is the cell phone dating app and I gave my resume to a girl who I talking to whose dad worked for a hedge fund in Boston. I was doing whatever it took.
  • Don’t give up. Jobs usually come from the most unlikely places. Just because you got an automated rejection email from State Street doesn’t mean that you are a failure. Try to stay away from just applying online to companies through the career website, or your schools job link. Many times those online applications are screened extremely loosely and if you don’t have much going for you on paper you’re likely to get rejected because it doesn’t give employers an full picture of the real you. I was also talking to a couple employers and many said that those sites just feed to the HR spam email folder and many are rarely looked at.
  • My last piece of advice is to not care about what other people think. This is your life, you need to hound people for a job. Don’t be afraid to really get their attention and don’t be passive because employers have a lot on their mind and will easily forget about potential candidates if they aren’t constantly being put in front of them. So make sure you dial that phone and send those emails reminding them who you are and what you want. My dad’s buddy once told me that he stood outside of a company in a suit everyday waiting for the employer to give him a job. His dedication and persistence paid off because even though he thought it was weird, he knew that my dad’s friend was hungry and dedicated. That’s what employers are looking for.

Good Luck and Let the Game of Life begin!