Blockchain Consensus Algorithms: Different Types and How They Work

What Are Blockchain Consensus Algorithms?

A crypto consensus mechanism forms the foundation of any blockchain. In 2009, Satoshi Nakamoto invented Bitcoin’s proof-of-work consensus algorithm to secure the Bitcoin network. Since then, several alternative consensus algorithms have been proposed.

The basic idea of achieving consensus on a blockchain is to create a way that everyone can agree that certain transactions are valid. That way, no one can cheat the system by creating fake transactions with money they don’t have, and the same funds can’t be sent twice.

Part of the reason Bitcoin was such a transformative technological innovation is that the proof-of-work method of achieving crypto consensus was the first-ever practical solution to the “double spend problem.”

With previous versions of electronic currency, one of the biggest hurdles programmers struggled to overcome was how to create a scarce digital asset that people couldn’t replicate and that couldn’t be spent more than once without everyone knowing.

Thanks in no small part to consensus algorithms, cryptocurrencies and the blockchain technology that powers them have overcome this problem.

Recommended: Crypto 101: What is Cryptocurrency?

What Is a Consensus Mechanism?

In a system run by one central authority (say, a bank), preventing double spending is simple. One entity manages the ledger of transactions, making sure everything runs smoothly. If Alice wants to give a dollar to Bob, the central manager subtracts a dollar from Alice’s account and adds that dollar to Bob’s account. Payment rails like banks and PayPal use this type of consensus mechanism.

With cryptocurrencies, however, there is no single entity in charge of the system, because it is a decentralized network by design. That makes keeping a record of the ledger of transactions — or, establishing a consensus mechanism — more difficult.

Recommended: What Is Distributed Ledger Technology (DLT)?

Consider Bitcoin, as an example. Instead of a single central server, many thousands of people around the globe run the Bitcoin software. The servers they run are called “nodes.” The nodes must somehow come to the same conclusion regarding what transactions have occurred on the network, or to “achieve consensus.” All the nodes need to be on the same page for the network to function.

How Does a Consensus Algorithm Work?

The way a crypto consensus mechanism works varies depending on the algorithm. But all have the same end goal: to achieve consensus on the network. This requires all nodes to agree on which transactions are valid and which are not. Consensus must be maintained from block to block in an orderly and secure fashion if things are to continue running smoothly.

Many of the potential cyberattacks that target blockchains involve disrupting the process of new block generation in some way. For this reason, it’s important that crypto consensus be achieved in a way that makes it difficult for bad actors to intervene.

Types of Consensus Algorithms

There have been many attempts to improve upon proof-of-work (PoW) algorithms. Proof of stake (PoS) might be the most popular of these, as many of the top cryptocurrencies by market cap today are PoS coins. Other crypto consensus methods like proof of burn or proof of capacity are less well-known and haven’t been tried as much.

Proof of Work

While there are now many different consensus algorithms, proof of work is still the most commonly used. To date, this method has shown itself to be reliable and secure.

Miners are the people who run computers that maintain the network by solving complex mathematical problems. The miner that first solves the problem gets to add the next block of transactions to the blockchain and also earns the new coins minted along with that block (the block reward). This is the process by which a verifiable history of transactions on the blockchain gets created.

PoW has shown to be a strong and secure method of achieving consensus. It would require so much computational power to overtake a large PoW network that any would-be hackers would be incentivized to become honest participants in the network instead. In other words, it’s easier and more rewarding to just mine for coins than it is to make any attempts at attacking the network.

Some of the downsides of PoW are that the process takes a lot of energy, it may not scale well, and it can trend toward centralization due to the high costs of new equipment — not everyone will be able to afford to mine. The main benefit of PoW is that it has the longest track record and has proven to be the most secure consensus algorithm. To date, there has never been a successful attempt at disrupting Bitcoin’s block production.

Proof of Stake

Proof of stake is a popular consensus mechanism that can be used by blockchains to verify their transaction history. While miners in PoW networks perform energy-intensive work to mine blocks, validators in PoS commit stakes of tokens to validate blocks.

With PoS, validators take the place of miners. They verify transactions by staking crypto on the network, which involves locking up a certain amount of coins for a set period of time, during which the coins will be unusable. Validators have a chance at being randomly selected to find the next block.

Other validators then “attest” that they also believe the block to be valid. Once enough validators have attested to a block’s validity, the block is then added to the chain. All validators involved in the process receive part of the block reward.

One of the big differences between PoS and PoW is that PoW requires miners to expend energy in the form of electricity to find blocks. PoS requires validators to stake their crypto, or in other words, to deposit money. For this reason, proof of stake is praised for being a less energy-intensive consensus mechanism than proof of work.

On the other hand, a disadvantage of PoS is that it favors the wealthiest token holders (who can stake more tokens) and trends toward centralization.

Proof of Burn

Proof-of-burn (PoB) algorithms employ the process of “burning” tokens to achieve crypto consensus. Burning coins involves sending them to an address from which they can never be recovered. Once sent to a burn address, coins are lost forever.

On a PoB network, people mine crypto by burning coins. The more coins burnt, the greater the reward.

An advantage of PoB is that it takes very little energy. A disadvantage is the question of how supply and demand will play out on such a blockchain. Burning existing coins to receive a reward of new coins seems counterintuitive. A delicate balance would have to be maintained for the system to work long-term.

What is the Bitcoin Consensus?

Bitcoin uses the proof-of-work consensus mechanism. Miners must contribute computing power and electricity to mine what remains of the 21 million bitcoins. Bitcoin mining involves processing transactions for the network, work for which miners are compensated with newly minted coins (the block reward). As of December 2021, each block rewards miners with a total of 6.25 BTC.

What is the Ethereum Consensus?

The Ethereum network also uses proof of work, although developers have been planning a move to proof of stake for some time. This change seems to be delayed each time it approaches, so there’s no telling when exactly it might happen.

The Takeaway

Consensus needs to be reached for a crypto network to know which transactions are valid. Otherwise, anyone could spend the same funds twice or make fake transactions using funds they don’t own.

While there are a number of other ways of achieving consensus, proof of work and proof of stake are the most well-known and widely used for now.

Interested in investing in crypto? With SoFi Invest®, you can trade cryptocurrency from a selection of more than two dozen coins including Bitcoin, Chainlink, Ethereum, Dogecoin, Solana, Litecoin, Cardano, and Enjin Coin.

Find out how to get started with SoFi Invest.

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17 Online Jobs You Can Do With No Experience

Whether you want to make a little extra money on the side, or you’re looking for an opportunity with the potential for a full-time income, it’s never been more possible than now.

There are so many jobs online that don’t require previous experience and allow you to work from anywhere with internet access, all you need is your laptop!

Regardless of the level of education or work history, anyone can find an online job if they know where to look.

We’ll show you some of the best online jobs with no experience required, as well as action steps to point you in the right direction.

Online Jobs with No Experience

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Fully Booked VA is an outstanding resource led by a highly successful VA.

3. Freelance Writer

Income Potential: $20/hr – $100/hr

Working as a freelance writer is one of the best ways to make money online, and you don’t need any specific experience. Of course, you’ll need to have strong writing and grammar skills, but it’s not as difficult as you might think. 

Most freelance writing gigs today are for online publications, and many websites and blogs prefer to publish conversational and informal content. Don’t think that you can’t work as a freelance writer because you struggled with term papers in school. The writing is entirely different and much more natural for most online publications. 

As far as grammar and spelling skills are concerned, tools like Grammarly can help immensely. 

There are writing opportunities in just about every industry and niche you can imagine. Some freelance writers take a general approach and write about anything the client wants, but it’s more lucrative to specialize in one industry or topic. 

Ideally, you can specialize in something you already know well so you can hit the ground running. Maybe you have knowledge from a previous job or a hobby that you can monetize by writing for clients. The rates of freelance writers are all over the place, but specialized writers tend to earn more due to their expertise.

Like working as a VA, freelance writing is equally well suited to be a side hustle or a full-time job. You can start small and scale up by adding new clients as you go.

Getting Started: Holly Johnson’s Earn More Writing is an excellent course that has helped many successful freelance writers launch their careers.

4. Blogger

Income Potential: Unlimited

If you like the idea of freelance writing but you don’t want to work for clients, another option is to start your blog. Blogging is also an excellent opportunity for anyone who wants to run an online business part-time or full-time, especially if you happen to have some writing skills.

You can start a blog on any topic you like, but if you want to make money, it’s best to stick with niches that are proven to be profitable, like:

  • Business
  • Finance
  • Health and Fitness
  • Wellness
  • Family and Parenting
  • Travel
  • Fashion and Beauty

Since these are all very competitive niches, it’s a good idea to choose a sub-niche to specialize in, like Vegan recipes instead of general health.

Blogging is something you can do part-time, as it fits your schedule. However, it’s also possible to grow it into a full-time income. Many successful bloggers earn an outstanding income from their blogs. 

The downside to blogging is that it takes time to grow. Most new bloggers don’t make much, if anything, during the first six months. You’ll probably start to make a little something later in your first year, but it doesn’t usually pick up until the blog is at least a year old. It requires patience to keep putting in work when you do not see much in terms of results. However, it can pay off in a big way if you stick with it.

Getting Started: See How to Make Money Blogging as a Side Hustle for a guide to getting started. 

5. Proofreader

Income Potential: $20/hr – $50/hr

Working as a proofreader is an excellent option for someone with solid spelling and grammar skills, as well as a strong eye for detail. You don’t need previous work experience to start, but you will need the skills to do the job. 

Several websites and online platforms offer proofreading work. Still, the best way to maximize your income potential is to work on your own as a freelancer rather than looking for an employer.

Getting Started: Proofread Anywhere, a course taught by Caitlin Pyle, is the best resource if you want to learn how to make money as a proofreader.

6. Transcription

Income Potential: $10/hr – $30/hr

If you’re able to type fast and accurately, working as a transcriptionist is an ideal way to make money. It’s highly flexible work, with most online transcription jobs allowing you to set your schedule. And it’s also a skill you can develop. You can fine-tune your typing skills by taking online typing tests until you’re ready to start working.

Transcription work can be done part-time or full-time. Some jobs do require transcription experience, but many others are open to beginners. 

While many websites offer transcription work, the pay from most of those companies is on the low side. To increase your earning potential, you can offer your services as a freelancer.

Getting Started: Transcribe Anywhere offers the best training in the industry. You’ll learn to maximize your income by finding freelance work rather than relying on low-paying platforms.

Online jobs where experience is not needed

7. Translation

Income Potential: $20/hr – $40/hr

If you’re multilingual, working as a translator is a natural choice. Translation jobs tend to pay well because only a limited number of people have the skills to perform the job, and there is plenty of work available. 

As a translation specialist, you could be translating books, blog posts, audio files, and more. Many jobs do not require previous translation experience, but of course, you’ll need excellent language skills to meet the qualifications. The more languages you know, the better.

Getting Started: Many companies hire translators, including Lionbridge and Gengo. You could also find clients as a freelancer.

8. Social Media Manager

Income Potential: $15/hr – $50/hr

If you have a strong understanding of popular social media platforms like Facebook, Instagram, Twitter, Pinterest, and LinkedIn, you could offer your services to businesses that need help. As a social media manager, you would manage your clients’ social profiles and keep new content coming to help boost their presence and influence. If you have some design skills, you can also create images and graphics for social media posts.

Some social media managers also manage ad campaigns for clients to promote their products or services. Many business owners want to advertise on Facebook, Instagram, and Pinterest, but they don’t know how to set up or manage those ads. Working as a social media ad specialist is one of the best entry-level online jobs, as you’ll be able to demand more money than a social media manager who doesn’t deal with ads.

Getting Started: To get started, choose the platforms you want to focus on (ideally the ones you already know well). Next, you’ll create a simple website with the details of the services you offer and begin reaching out to potential clients. Businesses in your local area are an ideal starting point.

Many social media managers offer package-based pricing rather than charging by the hour (effectively turning your service into a product). For example, you may charge the client a flat monthly rate for a specific number of posts per month.

9. Graphic Designer

Income Potential: $20/hr – $50/hr

Working as a freelance graphic designer is an excellent opportunity for anyone who has design skills. You don’t need past work experience, but you’ll probably need a portfolio to start landing clients. 

If you have some design skills, chances are, you already have some completed projects to include in your portfolio. And if you don’t, you can do some personal projects or offer discounted work to family and friends to gather a few work samples to create a portfolio.

Getting Started: Platforms like Upwork and Fiverr are options for beginners, but building up your profile on these platforms takes time and effort. 

Many freelance designers get started by finding clients through their personal networks. Talk to your friends, family members, co-workers (as long as there is no conflict of interest), neighbors, and other colleagues and tell them about the services you offer. Some may be interested in hiring you, or they may know other people who need a designer. Once you get started, word-of-mouth will become the best way to build your client base. Of course, you could also look for an employer offering entry-level design jobs, but you’ll sacrifice the flexibility that comes with freelancing.

10. Microtasker

Income Potential: $100 – $1,000 per month

Microtasks are small jobs that are very quick, usually just a few minutes or less. There are platforms that companies can use to hire individuals to complete these microtasks, and they present an income opportunity for just about everyone. 

The jobs may include things like:

  • Taking short surveys
  • Organizing data
  • Create or correct text
  • Basic research

Working as a microtasker is somewhat similar to taking online surveys. Your income potential is limited, and your hourly rate will be pretty low, but it’s exceptionally flexible, and anyone can do it. If you need to start making money right away, microtasking is an option. Microtasking isn’t ideal for a full-time income, but it’s a way to make a small amount of extra money without disrupting your schedule.

Getting Started: Many websites pay users for microtasks, including Amazon’s Mechanical Turk, Clickworker, and Swagbucks. All you need to do is create an account and those sites and start working.

11. Data Entry

Income Potential: $10 – $15 per hour

You don’t need any previous experience to work in data entry. This is one of the easier jobs available, and while it may not be the most exciting work, it does offer a way to make money without specific skills. 

Most online data entry jobs are part-time, but it’s probably not the best option for anyone who wants to earn a full-time income anyway. So those part-time hours are ideal for the job and for someone looking to make a few hundred dollars per month on the side.

Getting Started: Companies like Axion Data and Clickworker are ideal for someone looking to get started with data entry.

12. Customer Service 

Income Potential: $12 – $25 per hour

Customer service is another flexible online job with no experience required. You don’t need many specific skills to work as a customer service rep, but you will need strong people skills and excellent communication skills. 

There are several different types of customer service jobs available, including phone-based, email-based, and chat-based. While customer service jobs aren’t especially high-paying, you can earn a decent hourly rate for a job that’s open to beginners. 

Getting Started: Several companies like LiveOps, NexRep, and Arise offer customer service jobs.

13. Search Engine Evaluator

Income Potential: $12 – $15 per hour

Did you know it’s possible to get paid to do online searches and evaluate the results? A few companies hire search engine evaluators, but the demand for the jobs is stronger than the supply, so openings are not always available.

Working as a search engine evaluator is not the highest-paying job, but it is extremely flexible since you can do the work whenever it fits into your life. Also, this job is only part-time, so if you’re looking for a full-time income, you’ll need to choose something else.

Getting Started: Appen and Lionbridge are among the companies that hire search engine evaluators, although the positions are not always open. If you hope to work in this flexible part-time role, you’ll need to check the job listings frequently and complete an application whenever an opening is listed.

14. Research

Income Potential: $50 – $500 per month

Another simple online job that can be done with no previous experience is research. If you’re good at searching and finding specific nuggets of information, you may be very effective as an online researcher. 

Like some of the other jobs on this list that involve simple tasks, you’re not going to make a ton of money as a researcher, and it’s not ideal if you need a full-time income. But if you’re looking for a flexible way to make some extra income in your spare time, it could be an ideal option.

Getting Started: Several companies hire researchers, including Wonder and Clickworker. Create your profile, and you may be able to start earning money quickly.

15. Moderation

Income Potential: $12 – $25 per hour

Moderation is similar to customer service, and the income potential is about the same as well. You’ll be moderating a forum, Facebook Group, or some other online community. You don’t need specific experience, but you’ll need to be able to communicate and interact with people virtually. 

Getting Started: Companies like ModSquad, LiveWorld, and Crisp hire moderators. Check those sites for openings and apply for any jobs that interest you.

16. Website Tester

Income Potential: $300 per month

Many companies rely on data and feedback from users to perfect their websites and mobile apps. User tests can help to identify improvements that need to be made to the design or user experience.

As a website tester, you’ll earn money for each test you complete. The tests often take 5-30 minutes, but the details will vary. You don’t need specific skills or be highly tech-savvy (companies want testers who accurately represent real users). Most tests involve recording audio and video, so you’ll need a webcam and microphone, but a basic laptop is enough to get the job done.

The downside to this opportunity is that there are more workers than jobs, so the possibilities are somewhat limited. If you want to make money, you should take the available tests because they’re usually only available for a short time. You can make some extra money on the side as a tester, but it’s not going to turn into a massive income because there are only so many tests available.

Getting Started: Create a profile at websites like UserTesting, Userfeel, and Userlytics. Joining more programs will allow you to find more tests that are available and make more money.

17. Tutor

Income Potential: $10 – $30 per hour

Online tutoring jobs have become very popular in recent years. This is because there are a growing number of students worldwide who need teachers and tutors, which presents an opportunity to make money.

Many tutoring jobs involve teaching English as a second language, but there are tutoring opportunities in many other subjects as well. 

Some jobs for online tutors require teaching or tutoring experience, but others do not require experience. In most cases, you’ll need a bachelor’s degree to work as a tutor.

Getting Started: Cambly, italki, and VIPKid offering tutoring positions with no teaching experience required. The details of the jobs vary, but in all cases, you’ll be working with students virtually. 

Remote Online Jobs Are More Available Than Ever

There are many ways to make money online, and you might be surprised by some of the entry-level remote jobs that don’t require specific work experience.

Many of the opportunities covered here are ideal for making some extra money in your spare time, and other options are better income potential if you’re willing to freelance.

It’s just a matter of deciding what the best fit for you is.

Online jobs with no experience needed

17 Online Jobs You Can Do With No Experience

Source: biblemoneymatters.com

What Is the Stepped-Up Basis Tax Loophole?

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I remember when I was young, my dad would often say that the only things we “had” to do in this world were eat, sleep, and pay taxes; the rest was up to us. As I grew older, I realized that in many ways, he was right. When you go to the store and buy something, you pay sales tax, when you work and earn money, you pay income tax, and when you put gas in your car, chances are you’re paying a road tax or two. 

Even when you’re going through the process of estate planning, it’s important that you consider the tax implications of your decisions. After all, when you die, you don’t want the estate taxes paid by your heirs to cut too deeply into what you leave behind for them. 

You may have heard about tax loopholes ultra-wealthy people use to produce tax breaks, but you might be surprised that one of these loopholes is relatively simple for just about anyone with investment assets to take advantage of while planning their estates. 

It’s known as the stepped-up basis loophole, the stepped-up basis rule, or the cost-basis loophole, depending on who you talk to. No matter what you call it, if you plan on leaving investment assets to your heirs, taking advantage of the loophole will ease the burden when the IRS comes knocking after your assets have been transferred. 


What Is a Step-Up in Basis?

The stepped-up basis loophole is part of the tax code that applies to inherited assets such as stocks, bonds, mutual funds, real estate, and other investment property. The loophole is based on how capital gains taxes are calculated.

The IRS taxes investors on the amount of money they earned (profits) based on their purchase price (cost basis) and the market value of the asset upon the sale of the asset. If you buy 100 shares of ABC stock at $100 per share, your cost basis is $10,000. If the stock grows to $150 per share and you sell your shares for $15,000, you’ll pay capital gains taxes on $5,000, or your profits on the transaction.  

However, the stepped-up basis rule stipulates that, for tax purposes, the cost basis of inherited appreciated assets are adjusted to the fair market value at the time of the original owner’s death. This means that as far as the IRS is considered, the heir that inherited the assets obtained them at their value at the time of transfer, rather than at the original cost of the assets. 

As a result, heirs don’t pay capital gains taxes on the growth in the value of the asset during the original owner’s life; they simply pay taxes on gains from the date the assets are transferred to them. 


How the Stepped-Up Basis Loophole Works

The best way to explain how the stepped-up basis loophole works is to give you an example. 

Let’s say Joe is planning his estate, which includes 1,000 shares of ABC stock he wants to leave to an heir. Joe originally purchased these shares for $100 each, creating a cost basis of $100,000. Today, the shares are worth $200,000 thanks to the growth they’ve experienced over the past decade. 

When considering the shares of ABC stock in his estate, he’s got two options surrounding how the assets are transferred. 

Option #1: Cash Transfer (Voids the Stepped-Up Basis)

The first option Joe can use is a cash transfer. Through this process, when Joe dies, his holdings in ABC stock will be liquidated at a fair-market value. Upon the liquidation, the estate will owe tax on the capital gains at the current capital gains tax rate. For simplicity’s sake, let’s say that rate is 15%. 

Before the cash is transferred to Joe’s heir, the 15% tax would be deducted from the cash total. Since the investment was worth $100,000 when Joe purchased it and had grown to $200,000 at the time of his death, the gains — $100,000 — would be taxed at the 15% capital gains rate, working out to a tax of $15,000. 

As a result, Joe’s heir would receive a net payment of $185,000 as their inheritance. 

Option #2: Asset Transfer (Takes Advantage of the Loophole)

The second option is for Joe to transfer his stake in ABC to his heir as it stands. In doing so, his heir would benefit from a step-up in basis. Upon Joe’s death, the shares of ABC would be transferred directly to his heir with no cash transaction taking place. 

At this point, Joe’s heir would benefit from the IRS calculating a new cost basis based on the current value of the shares at the time of the transfer. This means that instead of Joe’s heir receiving $185,000 in cash, they would receive the full $200,000 in stock. 

If the heir was to sell that stock right away for $200,000, it would be a tax-free transaction. Once the IRS stepped up the cost basis of the stock to $200,000, as far as the IRS is concerned, there were no capital gains generated from the heir’s transaction. 


Why Does This Rule Exist?

While millionaires and billionaires often take advantage of a step-up in basis in their estate tax plan, it wasn’t necessarily designed for this purpose. In fact, many argue that the uber rich abuse this rule. 

The stepped-up basis rule was originally designed to give families that owned farms and other businesses a way to pass their livelihoods down to their children, keeping their businesses in the family without the fear of a tax burden-related closure of the company. 

For example, before the loophole was created, if Joe wanted to pass down his family farm to his son, he could, but the son would have to pay capital gains taxes on the entire increase in the value of the family farm from the date Joe first owned it. In some cases, those taxes were so large that heirs were forced to sell their family’s livelihood just to pay the taxes. 

The stepped-up basis rule made it so that when Joe passed the farm down to his children, the farm’s cost basis would be adjusted based on the fair market value on the date of Joe’s death, meaning there would be no exorbitant tax bill due when the heir inherited the business. 


Criticisms of Stepped-Up Basis

Although the stepped-up basis rule has done wonders for many heirs of family-owned businesses, allowing them to remain in existence and family owned to this day, the rule has come under scrutiny over the past several years. 

Some argue that the way the current law is written provides millionaires and billionaires a way to game the system that’s simply unfair to the average American. There’s validity to the argument too. 

The stepped-up basis rule creates an incredible incentive for the uber-rich to buy and hold assets until after their death. Through this process, the uber-wealthy are able to hand down hundreds of thousands, even millions more dollars than they would have if their estates had cashed out their investments and paid long-term capital gains taxes. 

So, what’s the problem with that?

According to Forbes, the top 1% wealthiest people in the United States are in control of a whopping 30.4% of the nation’s wealth. If all of these people hold their money in assets like stocks and real estate and use a step-up in basis for their heirs, there are two big consequences that follow:

It Starves the U.S Government of Billions in Tax Revenue

Taxes provide the funding that fuels the federal government. At the moment, total U.S. household net worth sits at $142 trillion, according to MarketWatch. That means the 30.4% of the nation’s wealth owned by the wealthiest one-percent works out to more than $43 trillion in total.

If $43 trillion was charged a tax rate of even 10% when this wealth was transferred in an inheritance, it would add $4.3 trillion in receivables for the U.S. government. That’s $4.3 trillion that wouldn’t have to be raised from everyone else through other forms of federal taxes, such as income taxes, likely reducing the tax burden for the average American. 

However, this loophole allows a large majority of that wealth to pass through as investment assets, meaning there’s no tax charged.   

It Starves the U.S. Economy of Spending

To take advantage of this tax loophole, many wealthy individuals sock large percentages of their money away in investment assets, with the intent of holding onto them until they die. That’s money that could be used to help spur economic development. 

Sure, you can’t expect the uber-rich to spend every penny they have. If they did that, they wouldn’t hold onto their wealth. However, without this loophole leaving so much money tied up in investments, the abundantly wealthy people in the country would potentially spend more money, leading to more opportunities for all. 


Proposals to Close the Stepped-Up Basis Tax Loophole

With widespread criticism of the stepped-up basis tax loophole, many politicians, especially in the Democratic Party, are racing to change the tax code. President Joe Biden has produced multiple proposals that involve closing the loophole, but they are awaiting a vote in Congress. 

Biden’s proposal known as the American Families Plan (AFP) would largely eliminate the loophole if passed, although there is no set time or date for the vote on the plan in Congress just yet. 

If it passes, however, the Biden Administration will notch a major win. The plan is aimed at improving opportunities for all Americans by extending tax cuts to lower- and middle-income families, providing additional education, and providing paid leave and child care support for families and workers. 

These benefits sound great, but they would be expensive. A major source of funding for Biden’s tax plan involves partially closing the stepped-up basis loophole. If the plan goes through, inheritances worth more than $1 million will no longer be able to use this loophole. Instead, the plan includes other protections for family farms and family-owned businesses being passed down to heirs. 


Final Word

The stepped-up basis loophole is one that’s used by countless families in the estate planning process across the nation. While the loophole saves many Americans from massive inheritance tax burdens, there’s a strong argument that the loophole creates an unfair advantage for the ultra-wealthy, which not only starves the government of much needed funding, but also starves the U.S. economy of a significant amount of spending. 

While there are naysayers, it’s important to keep in mind that the loophole still exists at present. As long as it’s out there, it’s important to consider it in your estate planning activities. 

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Joshua Rodriguez has worked in the finance and investing industry for more than a decade. In 2012, he decided he was ready to break free from the 9 to 5 rat race. By 2013, he became his own boss and hasn’t looked back since. Today, Joshua enjoys sharing his experience and expertise with up and comers to help enrich the financial lives of the masses rather than fuel the ongoing economic divide. When he’s not writing, helping up and comers in the freelance industry, and making his own investments and wise financial decisions, Joshua enjoys spending time with his wife, son, daughter, and eight large breed dogs. See what Joshua is up to by following his Twitter or contact him through his website, CNA Finance.

Source: moneycrashers.com

A look back at our 2021 credit card predictions and trends – The Points Guy


A look back at our 2021 credit card predictions and trends — The Points Guy


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Editorial Note: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Source: thepointsguy.com

Is the Stock Market Open on New Year’s Eve 2021?

Is it 2022 yet? Well … almost, but we’re going to have to muddle through one last trading session before we pop the champagne.

The stock market is indeed open for a full trading session on New Year’s Eve, which is on Friday, Dec. 31, 2021. (If you trade fixed income, you’re in a little bit of luck; the bond markets close up shop a little early, at 2 p.m. ET.)

If there’s a bright side, it’s that New Year’s Day is a holiday for the stock market and bond markets alike. Of course, it falls on a Saturday, so investors weren’t looking at much action then anyway.

From all of us at Kiplinger: Have a happy and prosperous 2022!

The following is a schedule of all stock market and bond market holidays for 2022. Please note that regular trading hours for the New York Stock Exchange (NYSE) and Nasdaq Stock Market are 9:30 a.m. to 4 p.m. Eastern on weekdays. The stock markets close at 1 p.m. on early-closure days; bond markets close early at 2 p.m.

2022 Market Holidays

Date Holiday NYSE Nasdaq Bond Markets*
Monday, Jan. 17 Martin Luther King Jr. Day Closed Closed Closed
Monday, Feb. 21 Presidents’ Day/Washington’s Birthday Closed Closed Closed
Thursday, April 14 Maundy Thursday Open Open Early close
(2 p.m.)
Friday, April 15 Good Friday Closed Closed Closed
Friday, May 27 Friday Before Memorial Day Open Open Early close
(2 p.m.)
Monday, May 30 Memorial Day Closed Closed Closed
Monday, June 20 Juneteenth National Independence Day (Observed) Closed Closed Closed
Friday, July 1 Friday Before Independence Day Open Open Early close
(2 p.m.)
Monday, July 4 Independence Day Closed Closed Closed
Monday, Sept. 5 Labor Day Closed Closed Closed
Monday, Oct. 10 Columbus Day Open Open Closed
Friday, Nov. 11 Veterans Day Open Open Closed
Thursday, Nov. 24 Thanksgiving Day Closed Closed Closed
Friday, Nov. 25 Day After Thanksgiving Early close
(1 p.m.)
Early close
(1 p.m.)
Early close
(2 p.m.)
Friday, Dec. 23 Christmas Eve (Observed) Open Open Early close
(2 p.m.)
Monday, Dec. 26 Christmas Day (Observed) Closed Closed Closed
Friday, Dec. 30 New Year’s Eve (Observed) Open Open Early close
(2 p.m.)

* This is the recommended bond market holiday schedule from the Securities Industry and Financial Markets Association (SIFMA). This schedule is subject to change.

Stock Market Holiday Observations

When it comes to the stock and bond markets alike, if a holiday falls on a weekend, market closures are dictated by two rules:

  • If the holiday falls on a Saturday, the market will close on the preceding Friday.
  • If the holiday falls on a Sunday, the market will close on the subsequent Monday.

Stock and Bond Market Hours

The “core trading” stock market hours for the NYSE and Nasdaq are 9:30 a.m. to 4 p.m. on weekdays. However, both exchanges offer premarket trading hours between 4 and 9:30 a.m., as well as late trading hours between 4 and 8 p.m.

Bond markets typically trade between 8 a.m. and 5 p.m.

The stock markets close at 1 p.m. on early-closure days; bond markets close early at 2 p.m.

Source: kiplinger.com

A Guide to MekaVerse NFTs

One of the most talked-about and hyped new non-fungible token (NFT) collections of the past year recently hit the market: The MekaVerse NFT collection.

Curious about this new NFT collection? This guide will explain what MekaVerse NFTs are, their history, and everything else you need to know.

Recap: What Is an NFT?

NFT stands for “non-fungible token,” a type of digital asset that typically takes the form of some sort of artwork. One way to think of it is that they’re much like a digital version of a baseball card.

NFTs have unique, identifiable metadata codes, meaning that they cannot be copied, and as such are one-of-a-kind. On the other hand, fungible tokens, like bitcoins, have many copies—they are all the same.

What Is MekaVerse NFT?

The MekaVerse NFT collection (which you can view here on OpenSea ) is a project that launched in October 2021, and it features 8,888 NFTs. The NFTs themselves feature a very specific artwork style, each boasting robots that are commonly known as “Mekas.” These Mekas are inspired by Gundam-style robots, which is itself a fictional Japanese anime franchise that features giant military robots called “mechas.” Each individual Meka has its own, unique story, or lore, that comes with it.

Since NFTs hit the mainstream over the past few years, the MekaVerse collection is perhaps the most-hyped collection release to date. Its Discord server has nearly 180,000 members, and it has more than 250,000 followers on Twitter .

History of MekaVerse

How does a collection of mecha NFTs become one of the most-followed digital asset drops in history? Here’s a brief rundown of the project’s history.

The two main people behind the MekaVerse project are “Matt” and “Mattey,” two European digital and graphic artists. They teamed up with Julien van Dorland, a veteran of the NFT landscape, and in late August 2021, MekaVerse opened social media and Discord accounts to the public to get a look at the NFT artwork.

From there, the hype took off. MekaVerse also started a public raffle that was held in early October, with the winners getting a chance to mint NFTs featuring either one or two Mekas. Those NFTs were then made public on OpenSea, an NFT marketplace. There was massive demand, too, as users registered nearly 173,000 wallets for the raffle.

On October 13, 2021, the complete MekaVerse NFT project was revealed . Sales for MekaVerse NFTs commenced, with sales averaging well into the thousands of dollars, and more than 5,000 individuals becoming MekaVerse NFT owners in the months since.

How Do MekaVerse NFTs Work?

The project’s collection of nearly 9,000 NFTs is designed to capitalize on the “scarcity” aspect of NFTs, and therefore, increase their value. Each individual Meka in the project is a unique, three-dimensional creation, further adding to its perceived value.

How to Buy MekaVerse NFTs

The NFT collection is open to traders, collectors, and NFT investors. It’s housed on OpenSea, which is one of the world’s largest NFT marketplaces.

To browse or buy, you can simply go to the MekaVerse NFT collection on OpenSea , and take a look at all of the NFTs that are available. The marketplace has data related to pricing, bidding, and more.

When someone becomes a holder of a MekaVerse NFT, they become a part of the Meka’s corresponding “faction,” and can then gain access to exclusive events on Twitter and Discord.

You can make an offer or buy NFTs on OpenSea, but it’ll require that you use Ethereum, or ETH, to do so. So, before you can actually make the purchase, you’ll need to create an account, get an Ethereum wallet, and attach it to your OpenSea account, so as to facilitate the transaction.

How Much Do MekaVerse NFTs Cost?

Since NFTs are commodities and traded on a marketplace, their prices are in flux. But if you’re looking for a straightforward answer as to how much MekaVerse NFTs cost, here’s one: They aren’t cheap.

As of mid-to-early December 2021, the median price for a MekaVerse NFT was more than $4,500 (although they’re priced in ETH). But some have sold for much more. Around the time the project launched, some NFTs were selling for hundreds of thousands of dollars.

Negative Sentiment Around MekaVerse NFTs

Every project has its issues and detractors, and the MekaVerse project is no different.

For instance, there were some delays in revealing some of the NFT images, which led to some lost momentum prior to launch. But those concerns were seemingly dwarfed by allegations of fraud, which surfaced on Twitter after the project launched.

In short, some people allege that certain buyers had early access to metadata, giving them an inside look at what images would be contained in certain NFTs — information that wasn’t available to everyone. That means that some buyers could have gotten their hands on high-value NFTs at lower prices, only to see their values shoot up later on.

Finally, there’s also been some criticism of the project due to the seeming lack of uniqueness among the NFT images. Some of the images appear to simply have colors swapped, rather than be a completely different Meka.

The Takeaway

As arguably the most anticipated NFT drop to date, the MekaVerse NFT collection has become very popular, very fast. The MekaVerse team does have a roadmap in place, which includes bringing the MekaVerse into the physical world with clothing and toys. There are also plans to airdrop free NFTs to current holders, which may include “weapons” and “companions” in future online games or events.

The NFT market is still new and full of potential for creators and investors. However, before investing in cryptocurrencies, NFTs, or any other digital asset, it’s important to research and understand the market.
One way to get started investing in digital assets is with SoFi Invest®. Members can trade cryptocurrency online from a selection of dozens of coins like Bitcoin, Ethereum, Dogecoin, Solana, Bitcoin, Litecoin, Cardano, and Enjin Coin.

Get started investing using SoFi Invest.

Photo credit: iStock/Space_Cat


SoFi Invest®
The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . SoFi Invest refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.
1) Automated Investing—The Automated Investing platform is owned by SoFi Wealth LLC, an SEC Registered Investment Advisor (“Sofi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC, an affiliated SEC registered broker dealer and member FINRA/SIPC, (“Sofi Securities).

2) Active Investing—The Active Investing platform is owned by SoFi Securities LLC. Clearing and custody of all securities are provided by APEX Clearing Corporation.

3) Cryptocurrency is offered by SoFi Digital Assets, LLC, a FinCEN registered Money Service Business.

For additional disclosures related to the SoFi Invest platforms described above, including state licensure of Sofi Digital Assets, LLC, please visit www.sofi.com/legal.
Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform. Information related to lending products contained herein should not be construed as an offer or pre-qualification for any loan product offered by SoFi Lending Corp and/or its affiliates.
Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.
Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SOIN1221543

Source: sofi.com

[Extended] Most Chase Co-Brand Cards Now Get Free DoorDash DashPass For 1 Year ($120 Value) + $10 Activation Credit

Update 12/30/21: This benefit seems to have been extended through 3/31/22. (While it still shows as 12/31 on the main landing page, it’s apparently showing 3/31/22 in the login.) Hat tip to reader Mark W

Update 12/23/21: You can enroll in this offer through 12/31/21 and get a full year of DashPass. Here’s a nice tip from Viper3773: the complimentary Sapphire Reserve DashPass is set to expire for a lot of people on 1/31/2022. You can cancel that now, remove the card from your DoorDash profile, then add a different eligible Chase co-branded card, and you should then have DashPass until 12/23/2022 or whichever date you do it (plus you should see a $10 DoorDash credit).

(Note: The DashPass benefit for the Sapphire Reserve card can be enrolled in through 3/31/22 while on most of the other cards the final enrollment date is 12/31/21.)

Update 7/20/21: Chase/DoorDash are now offering (link) an additional $10 credit when you activate this benefit. Valid until Sept 6 as part of the Summer of Doordash promotion.

Original post:

Chase offers a free 1-2 years of DoorDash DashPass to Sapphire cardholders (all versions) and 3 months to Freedom and Slate cardholders. They’ve now added the benefit to most of their co-brand cards with one free year of DashPass, a benefit which typically costs $9.99 per month.

Enroll Here | FAQ

DashPass offers zero delivery fees, lower service fees, and 5% back on pickup orders.

This new benefit is valid for one year after activation. If you don’t need it now – hold off activating and you’ll get a full year from activation. Just be sure to activate before December 31, 2021 when this offer ends. After 12 months you’ll be automatically charged $9.99 each month, so set yourself a reminder.

Eligible cards:

  • Southwest cards
  • Marriott cards
  • IHG cards
  • British, Aer Lingus, Iberia cards
  • United cards
  • World of Hyatt cards
  • Disney
  • Starbucks

If your Chase card is a Mastercard, this offer can stack well with the $5 twice-monthly Mastercard benefit for DashPass members. 

Hat tip to Frequentmiler

Source: doctorofcredit.com

How to Move With Plants – Apartminty

As an Amazon Associate I earn from qualifying purchases.

Moving is never anybody’s idea of fun, but doing it with plants can add a layer of complication and risk to your relocation. Moving plants can be stressful and daunting, but there are ways around it. People often think plants cannot survive on their own during transport. When you pack up your stuff, don’t forget the importance of packing up your plants too.

Inventory Your Plants

Before you start packing your plants, take inventory of how many you have and the light conditions they are currently in. Do a walkthrough of your new apartment space and be sure that you can provide your plants with a similar environment. If you cannot, it may be time to find your plant baby a new home. For plants that need a humid environment, chances are your new apartment won’t provide the same level of humidity. If you hold on to them they will most likely die a slow and painful death as a result.

You’ll want to take some time going over each plant’s needs and requirements beforehand so you can plan accordingly.

Prepping Your Plants for Transport-How to pack plants for the move is

There is no single correct way to do it, but here’s what you need to know: plants should be packed in such a manner that they won’t dry out or topple over during transport.

You don’t want plants with long leaves, like Dracaena and Yucca plants, to be in direct contact with the sides of a box or they might break. So when packing plants that have long leaves scrunch them into tight bunches and tie each bundle with string so they won’t fall apart when you unpack them at their new home.

Even plants like Peace Lilies, which don’t have long leaves, can topple over during a move.

To prevent this don’t pack plants with large surfaces flat against the box. Leave them at an angle so water won’t collect in their crowns and cause rot or mold to form.

Water plants thoroughly before you start packing them up for transport. This allows plants to store more water in their leaves and stems, which they will use as the soil dries out during transport.

How to Pack Your Plants

If you’re moving plants yourself, your options are to pack plants in boxes or bubble wrap them for safe transport. If plants are small enough they can be packed into boxes along with other things. If plants are larger, you might consider buying plants in pots that are already contained or covering plants with bubble wrap.

Two plants can be strapped to the top of a moving truck using bungee cords.

Moving plants in pots is easy – just pack them in boxes along with your other belongings, being sure not to put them on the bottom level so they don’t get squished.

When moving plants, the goal is to make sure you pack them well enough so they stay healthy and don’t arrive in poor condition. Moving plants are delicate creatures that need special attention when being transported from one place to another.

If you are moving a long distance, consider having your plants shipped to your new address using FedEx or UPS because it’s relatively inexpensive and plants tend to get handled with care when they are transported via these services.

For plants that need bright light, pack them in such a way so they can see some sun during transport. You don’t want the plants to be in the dark for very long. If you are taking plants with lots of airy foliage, pack them in such a way that they can get some fresh air during their travels.

You should also invest in plants boxes/containers to use while moving plants around. They are usually made out of corrugated cardboard and will last you longer than just this move.

Settling Plants into their new home

Be sure to give your plant babies some time to adjust to their new environment before placing them back into your home or office. Keep plants in the garage or outside for a few days, if possible, so plants can adjust to being back at home.

After plants have adjusted, introduce them to their new environment slowly by placing plants in a shady area of your home or office for a week so they can get acclimated. Be sure plants are close enough to an electrical outlet so you won’t have any dark days during the winter months.

We know plants rely on us to take care of them and provide a new environment, which they can thrive in. Our plants deserve the best and we don’t want to disappoint them!

Amazon and the Amazon logo are trademarks of Amazon.com, Inc, or its affiliates.

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Source: blog.apartminty.com

This Guy’s Strategy Raised His Credit Score by 120 Points

If you have more credit cards, you’ll have more credit available to you. You just have to resist the temptation to use all that credit. Don’t max out your cards.
That’s when he found Credit Sesame, a free website that helps people manage their credit better. He heard about it in a YouTube video.
Mike Brassfield ([email protected]) is a senior writer at The Penny Hoarder. He’s a Credit Sesame member and finally got his credit score above 700, woo hoo!
If you’re using up most of your available credit, that could hurt your credit score. The overall amount of your credit that you’re using is called your “credit utilization ratio,” and it can have a major impact on your credit rating. It counts for about 30% of your score.
Following Credit Sesame’s advice, Atkins launched the following one-two punch:

The Right Way to Use Your Credit Cards

“I would like to be able to move into a house,” Atkins said. “Hopefully I can make that happen before too long.”
Atkins always pays off his credit card bills every month. He doesn’t keep any unpaid balances, so he’s not paying interest.
“The first thing they did is, they actually gave me access to my credit score,” Atkins said. “They gave me the ability to see my credit score and see a recommendations tab — like, ‘Hey, this is what’s going on with your credit. Do this, this and this.’”**
So how did Atkins raise his credit score by 120 points in six months? Credit Sesame gave him personalized tips to steer him in the right direction.
“It’s really bad here. I’ve finally gotten serious about buying a house,” said Atkins, 37, who currently rents an apartment with a roommate. He figures he’d do better and get more living space by spending money on a mortgage instead of rent.

1. Disputing Negative Items

Ready to stop worrying about money?
Like Atkins, 60% of Credit Sesame members see an increase in their credit score; 50% see at least a 10-point increase, and 20% see at least a 50-point increase after 180 days.*

2. Acquiring More Credit Cards

Get the Penny Hoarder Daily
Aaron Atkins is tired of paying rent. He lives in Phoenix, Arizona, where the rent just keeps going up. You know how it is. It’s like that everywhere, but especially in Phoenix.
*Credit Sesame does not guarantee any of these results, and some may even see a decrease in their credit score. Any score improvement is the result of many factors, including paying bills on time, keeping credit balances low, avoiding unnecessary inquiries, appropriate financial planning and developing better credit habits.
Once his credit started improving, Atkins applied for a credit card that Credit Sesame recommended to him. Then another. Because it often helps your credit score to have credit that you’re not fully using.
Through Credit Sesame, Atkins got a company named Lexington Law to take care of this for him. Like a lot of Credit Sesame members, he stopped paying Lexington Law’s monthly fee once that company had done its work for him. He’s kept his free Credit Sesame membership, though.

How Your Credit Affects Your Life — and How You Can Raise Your Score

Source: thepennyhoarder.com
It’ll even show you if there’s a mistake on your credit report that’s holding you back. (One in five reports has a mistake.)
He immediately had a problem: His credit was pretty lousy. He had a low credit score of only 520. A previous relationship “really wrecked my world, in terms of finances,” Atkins said. Realtors told him that if he wanted to buy a home, especially in this real estate market, then he’d better improve his credit.
Once you review your credit report, you can dispute certain negative marks that are dragging you down. You send dispute letters to the three major credit bureaus: Equifax, Experian and Transunion.
**This article is written about a true Credit Sesame member. This score improvement is the result of many factors and not all actions may be relevant or suitable for your credit profile. 60% of Credit Sesame members see an increase in their credit score; 50% see at least a 10-point increase, and 20% see at least a 50-point increase after 180 days.
Your credit score isn’t just some pointless three-digit number. It influences major parts of your life, like where you live and what you drive. The higher your score, the better deal you’ll get on big things like a mortgage, a car loan, a credit card, a car rental or an apartment lease. <!–

–>


The percentage of your overall credit limit that you’re using is one of the factors that your credit score is based on, along with your payment history, length of credit history and diversity of credit.