Category Archives: Featured

Take Control of Your Financial Future By Paying Yourself First

One of my most memorable lessons from my childhood was when I learned the importance of “paying yourself first.” Many of my peers and friends have complained about their money problems; bills weigh on their mind and they become stressed living paycheck to paycheck. While it is important to stay cognizant of costs and expenditures, too many people make paying their bills their number one priority.This leaves them treading water just to keep their nose out of the water. This is definitely not detrimental, but it will not leave you on top or help you reach your more long term financial goals. I’m here to tell you why it is more important to pay yourself first before paying any bills.

The common routine for many millennials is to set aside money every month for costs, such as rent, transportation, etc. and then treat the leftover money as free spending to blow. Instead, I am suggesting that you first set aside an amount, “personal bill” and then using the rest to supplement bills and other costs. Creating this kind of system will change your mindset about your money. First and foremost you will be saving and secondly, you will be more calculated and thoughtful about how you spend your earrnings. Putting your money in a personal account will prevent you from spending carelessy.

An easy way to start this spending transformation is to go to the bank and open up an account specifically for your savings goal, whether it be a car a house, business or your future. These accounts can be set up so a percentage of your weekly paycheck is directly deposited. This can also be accomplished by setting up a a pre-tax or Roth 401K account. With these types of programs, some of your “extra” money will go directly towards yoru retirement fund that you will be able to acess around the age of 65. As I’ve written about in previous blog posts, a 401k adds a percentage of your paycheck and in many situations your employer will also match your contribution up to as high as 5%.

By focusing on long term financial goals and redesigning your spending/ saving schedule, you can really improve your financial standing. Having a personal account can also bring more security and allow you agency to act on larger investment opportunities that could present themselves in the future. With this mindset, budgeting becomes a crucial component to your life. You should always be adding your savings or “profit” into your weekly and monthly budgets. You want your personal account to be a guaranteed resource you can draw on, so maintenance and continual deposits are crucial. Your other finances will naturally accommodate and adjust for this extra profit and you will in-turn become more intune and financially savvy.

A further benefit to “paying yourself first” is the secondary psychological effects from having saved money. It can be a great feeling to know that you are now controlling your own financial security and this can in-turn guide even more smart choices for how to save and invest money that comes your way in the future.

Why You Need To Look Into Tax-Free Spending Accounts Now

 If you are currently employed, you should at least take a look and see if your employer can offer you  these spending accounts and you could save more money for yourself and give less to Sam.

Flexible Spending Accounts

“Approximately thirty-five million Americans are covered by a flexible spending account (FSA).* FSAs are employer-based programs that allow consumers to set aside tax-free dollars to purchase medical products and services – from bandaids to smoking cessation programs and tens of thousands of products and services in between (FSAStore.com)”.

This is yet another program offered by your employer so you can make them work for you. Sites like FSAstore.com let users purchase everyday items such as glasses, contacts, thermometers, bandaids, sunscreen etc. basically all out-of pocket health care costs with tax-free money.

Your employer will front you up to $2,550 from your annual salary in the beginning of your plan year. The amount can be up to $2,550, but the one trick here is that you have to use all that money you set aside by the end of the year or else it will be returned to the employer. So, you have to hedge your bet that you will use the allotted money within the year time period. (FSA Calculator)

If you normally buy the many products approved for flexible spending accounts, then this is a great program and can save you lots of money (up to $1009.80). Depending on your employer, they may offer you one of two options:

  1. You may receive a “grace period” where you can get up to 2.5 extra months to use the money in your flexible spending account, or
  2. You may be allowed to carry over up to $500 per year to use in the following year (healthcare.gov).

Commuter Benefits Accounts

If you are a millennial living in the city, flexible spending accounts also have good commuter benefits. I know that many New York companies have transportation reimbursement program where they will reimburse you for public transportation (this also applies to all major cities). This can be a great way to use tax-free money for your daily commute. This year, New York City increased subway fare. Even more reason to save as much as $550 (39.6% tax bracket and 116.5/month for MTA subway pass) using your commuter benefit options with your employer. Look into Wageworks.com for more information.

If you haven’t heard of a these spending accounts and are interested in saving money on things you would end up purchasing anyways I strongly recommend you look into a tax-free.

Sources:

https://www.healthcare.gov/flexible-spending-accounts/

https://www.fsastore.com

Why Jake Gyllenhaal In Nightcrawler Is The Perfect Entrepreneur

Last night I decided to watch the movie Nightcrawler upon the suggestion of my friends. They were bragging that it was “a must see movie,” so I wanted to see what all the buzz was about. Overall the film was very dark and ominous. The movie revolves around a man named Lou Bloom (Jake Gyllenhaal) who is a creepy, obsessive person attempting to solidify a career as a ‘Nightcrawler’. A ‘Nightcrawler’ is someone who races to crime scenes throughout a city in order to capture first response footage of different accidents, murders, breaking news, etc. They then sell their footage to news stations and other media hubs. I don’t want to reveal  too many spoilers, but if you haven’t seen it yet, I highly recommend doing so.

Why Lou Bloom is the Perfect Entrepreneur.

Lou is curious. In the early stages of the film, Lou pulls his car over after spotting two camera men trying to capture footage of victims at the scene of a car accident. He saw this as an opportunity to explore a new career. Curiosity is an extremely valuable trait for any successful entrepreneur because it is the seeking of unanswered questions that leads to the expansion of any business idea. In this instance, Lou wanted to learn everything about what they were doing…from the equipment they were carrying to the strategy they were employing. He is eager to learn, takes action and ultimately gains useful knowledge by doing so. When you are constantly seeking out new environments and new information, you are essentially opening the doors for positive change and modifications to your business plan.

Lou is persistent. He closely approaches crime scenes with confidence and assertiveness, even though his presence tends to be unwelcomed. He also demonstrates persistence when he continually asks news correspondents about increased compensation for the novel footage he captures, even though they don’t comply. Being turned down does not stop Lou from carrying on with his business endeavors. He is persistent while remaining passionate about the success of his business, and will do whatever is necessary to assuage those around him. Passivity doesn’t fly in this fast paced world. If you want to succeed, you must show unwavering intention.

Lou is constantly learning. During one scene Lou is talking to Nina, the news executive, about a business course he took. He said the most important lesson he gained was that there is so much to learn in this world, but those that learn are the ones that look hard enough to find it. This hit me. In this day and age we have an unlimited source of information at our fingertips, but the search for the knowledge we need requires stamina and persistence. A large part of being successful is having access to the information necessary to be prepared in any situation. Whether it is the information you need for an interview, a meeting or pitching new ideas to clients. What you need is all around you, you just have to want to find it.

Lou is a negotiator. Throughout the film, Lou has to negotiate many situations. Whether it be deciding on the cost of his footage or figuring out the salary for his first employee. Althogh negotiation is a two way street, Lou never begins the process before solidifying a number in mind. He will either stick with that number or settle on a better price. His most powerful technique is the will to walk away. He was fully willing to deny his partner a spot in his company or ready to bring his footage straight to another company. He always remained confident in the worth of his company and his work. He won’t settle for less without being unrealistic. Deep down, all of us has an assessment of our capabilities. Settling for someone else’s assessment of your worth will only make you unsatisfied and unhappy. A good entrepreneur is constantly evaluating their worth and sticking to this method in everything they do.

Lou is detail oriented. He thinks and plans out everything about his company and its future, down to how he wants to be addressed to the language his employees will use when they communicate within business contexts. When Lou is negotiating with Nina, he tells her exactly how he wants to be presented with other executives of her company, and exactly how he wants to appear on Live TV. This is a tedious, but valuable characteristic of any successful entrepreneur because the little things really do matter. Details are key because even the smallest overlooked details could compromise a business’ reputation.

Lou finds his passion. Lou emphasizes the importance of finding work that adheres to his personal strengths and interests. However, he is also not quick to judge new opportunities that cross his path. Sometimes it is the random opportunities in life that can become the work that makes you the happiest. As Lou becomes a Nightcrawler, he realizes it is an occupation that he has not only become very good at, but very passionate about as well. So I want to conclude with this; it is easy to write off new opportunities for fear of the unknown, failure, etc. But you must remember to alway keep your mind open for exploration because it is those  new things that you are unsure of that might just become your next passion!

Alright, enough from me. Now go watch ‘NightCrawler.’

3 Resolutions To Get Your Finances In Shape This Year

It’s the start of the year all over again. “New year, new you,” you’ve heard it a million times. Everyone says it. The time to change things around and turn over a new leaf, form better habits and start living a more fulfilled life, or so you think. Everyone wants a strong body, a fit mind, to worry less, love more blah blah blah. Well what about a fit wallet? Maybe this year, it is time to start building a sturdy base for financial success that will carry you through your life. Why don’t you make this year about ramping up your PFS (Personal Financial Statement)? This is the year to start seeing less red and more GREEN. I want to share with you some of the resolutions you should make during this new year that can help you get growing!

First and foremost, save money. I cannot stress this enough. Whether it’s in a savings account, checking account, certificate of deposit, retirement account, 401k, etc. If you are only going to do one thing this year that is going to put you on the path to saving, open one of these accounts. Even if you only have a little to save, just the act will make you feel better about your future. Furthermore, if you can constantly contribute you will soon watch your money grow and mature, your financial self esteem will increase and you will become more proud of yourself and more confident in your ability to save. Start this habit NOW, so it can become second nature.

Dabble in investments. Saving money is important, but it won’t make you rich. You need your money to work for you. This is another crucial process necessary to grow your wealth. You need to make smart investments with your money, investments that will grow and give you good returns in your future. Examples of smart investments include opening a brokerage account for trading stocks, investing in business projects, friends businesses, your passions, land, properties etc. If investing is too scary of a step at this point, do some research! Learning about different opportunities can help you get your foot in the door. Read a book that will increase your knowledge in the subject or ask friends, family and colleagues about their investing experiences. Knowledge is power and the more you know the better your decision will be regarding certain investments. A book I strongly suggest above the others is ‘Rich Dad, Poor Dad’ if you haven’t read it already. It will change the way you think about money and wealth for good.
The last resolution you need to stand by is ridding yourself of impulsive spending. Take control of your money and your wallet. This is by far one of the most important resolutions because it can impact a lot of your everyday decisions. Make a list and take a hard look at what you spend, what you need and what you can live without in 2015. Do you need a Starbucks coffee everyday? How about a $5 breakfast sandwich? Can you bring your own lunch instead of paying $11/day? Do you actually need to buy new shoes every month or go shopping every weekend? Can you save by eating in? Why don’t you try cooking, it might save you money and calories! Why don’t you try fixing things that are broken or torn instead replacing them? Get creative with your life. Learn to create things instead of buying them. You are more able than you think. Don’t buy artwork for your apartment, make your own art. Stop spending money when you don’t have to or can do something for less. As the millennial generation we tend to fix problems by throwing money at them. Learn to take control of your problems and try solving them yourself before you open your wallet or pull out your card. Buy simpler foods, use less resources, buy a bigger blanket and use less heat at night. Become a minimalist and get rid of excess. Only spend money that you have and not money that you borrow. Leave your credit card at home. Once you do this, go back to the first resolution I mentioned and start saving your money!

Why you don’t have to be Gordon Gekko to Invest in the Stock Market

Before I really understood the stock market, I always assumed investing was reserved for highly intelligent finance geeks, who read textbooks on the in’s and out’s of trading. As if they specialized in a secret science, an opportunity only available for the privileged that had the wealth needed to invest and grow. Like my unrealistic, childhood dream of becoming a celebrity, the thought of trading stocks was always desirable, but always seemed unattainable. However, after attending Bentley University and living amongst many other finance majors for the first time, I started to understand what it actually meant to trade different securities in the marketplace.

One of the biggest game changers was when I realized that I didn’t have to be a chic trader on Wall Street, finance professional or an economics professor to trade stocks. Really anyone can do it, and I mean everyone. Even you! All you really need is a computer, access to the Internet and about $200 dollars to invest. I was very unaware of just how accessible the stock market was. My classmates were pouring money into these brokerage accounts, buying and selling stocks in the dorms, during class and even on their smart phones walking around campus. My intrigue spiked one day, when my friend told me he had been paying off his college tuition by trading securities. He was very successful in his endeavors and had even bought a car with some of his yearly proceeds (not everyone is this successful). After that I knew I had to start putting money aside so I could finally take a chance of my own, and invest myself in the market. I told myself that even if I completely failed and lost everything, it would be a great learning experience. The decision proved to be worthwhile.

My first step, which was a very important one, was to choose the right brokerage online. Obviously I had seen various commercials and advertisements for brokerages of these types, but I wanted to do some comparison before I settled. It is important to choose a company that caters to your exact personal investment needs. This is especially important because every time you trade, you have to pay a percent fee known as commission. Commission is a rate fee that is tacked on to the cost of purchasing or selling stock, and every company has a different commission rate. This rate also tends to vary depending on stock type and/or amount invested. Investors also have to pay for the options in addition to the account, such as consultations, personal attention, branch locations, etc. These additional costs can add up, so it is important to keep all of this in mind when figuring out a brokerage to use. there are many sites that can give you a breakdown of pros and cons for each site.

As a millennial we aren’t the most trusting people when it comes to other people handling our money so I skipped out on a brokerage house that offered expensive advice. I wanted to learn about the market myself. We have an endless heap of knowledge known as the internet at our fingertips. I just figured I would research all the stocks myself and this would help me understand the market better and further my knowledge. Also with such low commission rates it makes sense for us millennials because we don’t have all this extra money to just toss around, the fees do tend to add up if you trade a lot.

What I learned after my first few weeks of trading was that once you put some skin in the game, you are more motivated to learn and understand where your money is going and how the system works. It was definitely one of the big motivating factors. You tend to watch the news more and pay attention to worldly events and the market. I always wanted to know what the market was doing. You will quickly learn that stock prices are more heavily influenced by the news rather than how the company may actually be doing according to numbers. So if you pay attention you can make predictions on when you may want to buy a certain security or sell, sell, sell.

The first $200 I ACH’d into the platform bought me a learning experience that I really don’t think I could’ve gotten anywhere else. It was worth every penny. This blurb of an article is just a little piece of insight to get anyone who is thinking about trading stocks or learning more about the process to consider the benefits and the knowledge that you can gain from learning to invest and what I wish someone told me before I knew anything about investing. Good Luck!

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!