Helping people prepare for for a successful retirement is what I do every day. A bulk of the retirees typically will have some sort of pension or retirement account that represents the majority of their investable assets.
Deciding the proper strategy to do with that money is the most common thing we do and more times than not, it makes sense to roll that retirement account into a traditional IRA. When we’re deciding on an income plan with the IRA it never fails that I get the question, “How much interest does an IRA make?”. I always crack a smile when I hear this because it’s such a common question that hear, that I thought it would be best to explain how you actually make interest on an IRA.
Why an IRA is a Good Choice for Retirement Funds
While everyone is different, and you shouldn’t roll your money into an IRA without carefully considering your choices, there are some very valid reasons to do so in retirement.
Flexibility: The biggest reason to use an IRA for your retirement portfolio is the flexibility that comes with an IRA. With most IRAs, you have the ability to choose your own investments. You can choose funds that work well for you, and that might not be available in your current 401(k). It’s easier to make changes to your IRA than it is to make changes in a less flexible retirement plan sponsored by your former employer.
Access: Because you can choose your own IRA custodian, it can make access a little easier. As a retiree, you need access to your account. Choosing your own custodian might allow you easier account access, plus there is a good chance that your new IRA custodian offers an array of tools that can make your in-retirement income planning a little easier. A 401(k) or 403(b) at your former employer means that you have to stick with the custodian the company chooses.
Lower cost: While consumer pressure has resulted in lower fees for many employer-sponsored plans, the reality is that you can often find even lower fees with an IRA. Combine the lower administrative costs of an IRA with the fact that you have the flexibility to choose lower-cost funds and ETFs for your IRA, and your money will be more cost-efficient since your real returns won’t be eaten away by the high fees you were paying previously.
The right IRA is easier to manage, less expensive, and provides you with more choices. Consult with a knowledgeable financial planner to help you find the right place to keep your IRA, and to help you figure out how to allocate your assets within an IRA so that you are more likely to accomplish your goals.
The Best Rates On Your IRA
I wrote a post about the best rates on a Roth IRA, which is a great guide for those who are still in the the accumulation stage of investing. If you are already retired, though, your needs are different. The best rates on your IRA mean something different if you rely on your nest egg for the income you need to support your retirement lifestyle.
Getting the best rates on your IRA is about understanding what you can keep in your IRA, as well as knowing how to use asset allocation to your advantage during your retirement years. Unfortunately, there isn’t a lot of education out there for retirees on this subject, so there is a measure of confusion about how to use an IRA to your best advantage.
Why is There So Much Confusion?
Many investors associate IRAs with the IRA CD you see advertised at your local bank. A CD is a product that offers a fixed rate of return. Your CD will pay according to a stated interest rate. Unless the financial institution has a relationship with a brokerage firm, then CDs or savings accounts are the only investment option that the IRA can have. That means that your yield is going to be relatively low.
An IRA CD is often offered with a 10-year term, and the rate is higher than most of the other CD offerings from the bank. However, most of these rates are nothing to write home about. As a result, retirees get the idea that IRAs offer yields that are too low for their needs.
The reality is that an IRA is an extremely flexible tax-advantaged retirement account that allows you to keep a variety of assets. The most common assets are stocks and bonds, in the form of funds. However, in some cases, it’s possible to use IRAs to invest in real estate, businesses, and even precious metals. (You will need to find a custodian willing to work with you for more exotic IRA holdings, and your administrative costs will be higher.)
Most retirees, though, are better off sticking to stock and bond funds in their IRAs. These assets usually offer better returns than IRA CDs while still allowing you to maintain an acceptable level of risk.
IRA Interest Rate = Total Return
They say a picture is worth a thousand words. Let’s see if this sketch helps paint a clearer picture on how you are able to make money on an IRA:
Total Return for Interest Rate on an IRA
*Dividends are not guaranteed. Interest and bond payments are subject to the claims paying ability of the issuer and may be subject to certain terms or restrictions. Investing is subject to risk. Appreciation is not guaranteed.
Let’s keep it simple: almost every retiree’s portfolio consists of a portion of stocks and bonds. Stocks and bonds are called asset classes because they are two different types of investments. The mix of stocks and bonds, called asset allocation, depends on a number of risk profiles, including your own risk tolerance and when you expect to need the money. When you have a portfolio that consists of these two asset classes, you have two main components that will you give the total return (or interest rate, as most of us think of it):
Income (from stock dividends, bond interest payments, and distributions)
Appreciation (or depreciation).
You need to understand how these operate inside your IRA in order to get a sense of your true interest rate, as well as if you want to make better decisions about what to do with your money.
Income From a Portfolio
Typically, when you hear “income” regarding an investment portfolio, the most common thing that comes to mind is bonds. Bonds pay what is called a “coupon payment,” which is based on the stated interest rate on the bond. These coupon payments can be paid monthly, quarterly, or semi-annually- all depending on the issuer of the bond. When your bond matures, you receive the principal back, and you can reinvest in another bond if you wish.
The other income component from a portfolio is dividends from stocks or preferred stocks. If you own a percentage of stock in your portfolio then there’s a good chance that some of the stock you own pay dividends. Here’s a tidbit on stock dividends from Investorguide.com:
Dividends are determined by the company who issued the stock and they may fluctuate greatly. Dividends are cash payments that the company pays to stock holders based upon profits and are paid out on a per share basis. In other words, a business may determine that the dividend payout to stockholders for the first quarter is $.25 per share. So, a person who owns 1000 shares would receive a dividend payment of $250 for the first quarter.
The income portion of the portfolio is the closest you’ll get to a fixed interest rate on your portfolio. I want to stress that even the income portion of a portfolio can change pretty quickly based on many factors. Increasing or decreasing interest rates will have the largest effect just as they would on CDs at your bank.
Additionally, it’s possible that a company will cut its dividend, reducing how much you receive. Many retirees choose to invest in stocks known as dividend aristocrats, or invest in funds composed of dividend aristocrats. These are companies that have increased their dividends at least once a year for the last 25 years. While there is always the possibility that these companies will cut their dividends, there is a lower chance of that because of the long history, and the fact that many of these companies have to be pretty sound to keep raising dividends.
Appreciation on a Portfolio
The second factor that will contribute the return on your IRA portfolio is appreciation (or depreciation). Simply put: making money. With stocks, that is pretty simple. You buy stock XYZ and $5.00 and sell it at $10.00, you have appreciation. That is pretty straight forward. What most investors don’t realize is that appreciation potential does not just apply to stocks. You can make it on your bonds, too. Say what?
When people think of investing in bonds, they just think that you buy a bond and collect the interest. Just like a CD. While this is true, most investors don’t realize that you can trade bonds in the secondary market and the value can go up or down.
Many bonds are issued at par (or face value) which is $1,000. The value of the bond has a “teeter totter” relationship with the movement of interest rates. After the bond is issued, if interest rates go up, the value of that bond will go down. Reverse the interest rate movement, and the value will go up. Your bank CDs actually do this, too; it’s just not as obvious.
Another factor to consider in the value of the bond is the strength of the issuer. Remember when Lehman Brothers was on the verge of bankruptcy? Their bonds went from $1,000 to less than a $100 before they eventually went bankrupt.
They way you can make appreciation on a bond is by buying in the secondary market if it’s now selling below the $1,000 issue value. You can wait until the bond is worth more than the issue value, and then sell it for a profit later.
Example: You buy a bond at $950 that will mature in 3 years at $1000. Not only do you get the appreciation, but you also get the interest payment, too.
For Best Results: Avoid Active Trading in Your IRA
As always, you are most likely to achieve your best results when you avoid actively trading in your IRA. While IRAs offer flexibility, and a way to buy and sell assets on a tax-advantaged basis, the reality is that frequent buying and selling can result in lower returns.
Not only is there a better chance that you will trade at the wrong time (the worst is panicking and selling low), but you might also choose the wrong individual securities for the long term.
Many retirees have better luck by investing in low-cost funds and ETFs in an asset allocation that helps them meet their needs. These funds can help even out income from the portfolio, and they offer diversity and a certain degree of protection. Plus, it’s a lot less work on your part.
Count Your Interest Blessings
The interest you earn on your IRA has many variables. That’s why it’s important to meet with a CERTIFIED FINANCIAL PLANNER™ to help make sense of your income needs and to help you position your accounts to potentially make the highest rates on your IRA.
More Disclosures:
Certificates of Deposit at FDIC insured and offer a fixed rate of return. Certificates of Deposit that are sold prior to maturity in the secondary market are subject to market fluctuation, so that upon sale an investor may receive more or less than their original investment.
Stock investing involves risk including loss of principal.
Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rate rise and are subject to availability and change in price.
Price, yields and availability of securities are subject to change. Certain call or special redemption features may exist which could impact yield.
Hypothetical examples are for illustrative purposes only. Results will vary.
How much should you spend on a wedding? Well, that depends on who you’re asking, I suppose. As I’m sure most of you are aware, the personal finance blogosphere tends to be divided into two main camps: those that are focused on investments and entrepreneurship and those that are focused on frugality.
In my experience, however, the entrepreneurship camp is pretty live-and-let-live. The whole “cut everything you don’t care about so you can spend whatever you’d like on the things you do care about” school of thought. When you think about it, this makes sense for a few reasons.
We all have different skill sets to be utilized in our respective side hustles.
Different skills mean different pricing schemes.
We all have different work and family situations that we’re fitting said side hustles in around.
We all care about spending our money on different things, and those things cost different amounts and reflect our tastes and values.
Long story short, what this means is that sometimes it’s difficult to talk about investment and entrepreneurial issues in a way that applies to everyone.
Scenario 1: Someone who just graduated from college, hasn’t been able to find a job yet, and doesn’t have much work experience or professional contacts who is moving out of the dorms and trying to get a lease on an apartment.
Scenario 2: someone who has been in a stable job in their field for fifteen years and wants to start building up their side hustle so they can leave their nine to five and spend more time working from home now that their second child is on the way and their home is halfway paid off.
How do you give the meaningful advice to both folks at the same time? Not an easy task.
However, if I post a recipe for how to make your own laundry detergent and tell you it only takes 20 minutes to make a six-month supply, well — there’s no reason everyone can’t take advantage of that, right? As a result, frugalistas tend to be a little more “one size fits all” and, dare I say it, judgmental (in lots of blog communities, anyway, though blessedly less so at GRS).
What does all this have to do with my wedding? While my husband and I spent significantly less than the national average of $27,000, we did end up clocking in at what was — for me, anyway — a nearly heart-stopping $11,400.
However, there’s more to this type of spending than pure number-crunching; psychology and social expectations play a huge role, and those who argue that those factors shouldn’t play a part are in need of a serious reality check.
Expectations v. Reality
Contrary to stereotype, my idea of a wedding was eloping and sending out postcards to our holiday card list afterward telling people it happened. After all, we not only have school and consumer debt we’re trying to pay off (more on that in another post), but we’ve been together for six years and living together for four of those years. In my eyes, it was a formality that didn’t require a huge expense.
My fiancé, on the other hand, wanted the whole shebang: ceremony in a church (which I did manage to talk him out of — barely — by pointing out that we’re atheists) and formal reception with a hundred and fifty guests. He’d literally been dreaming of his wedding day his entire life and had never once envisioned it without all the bells and whistles. I can’t emphasize this enough; He wanted a black-tie affair and a string quartet, and that’s just for starters.
After pointing out a few salient points, like:
I hadn’t paid off over $10,000 in credit card debt just to rack it all up again, especially when my salary is only $40,000 per year.
He had just quit his extremely lucrative job at a mid-size law firm where he was well on his way to partner for a far more uncertain future starting his own firm with a friend who isn’t exactly renowned for his work ethic.
Our parents were in no position to contribute to the costs: we were completely on our own as far as paying for the wedding.
He agreed with me that there was no way we could pull off a traditional wedding and honeymoon on our own. At first we didn’t think this was going to be a big deal; after all, surely there were less-expensive packages offered by wedding vendors, right? We priced five vendors and, much to our surprise, struggled to find a single one that could provide us for a quote under $20,000. Which didn’t even include the honeymoon. Gulp. Enter compromise. But where would we even start?
However, over the course of many conversations, priorities began to emerge.
First, neither of us are huge DIY-ers, meaning we weren’t going to sit around for hours making invitations and table centerpieces from scratch. Second, having a formal event was non-negotiable; a pot-luck in the park wasn’t going to cut it. Third, the event itself could be small, as long as all our friends and family were invited. Fourth, we weren’t willing to forgo a honeymoon in favor of the ceremony. And finally, we wanted to go on a cruise for our honeymoon.
The Epiphany
Score! I don’t even know where he came across it since it’s not on the cruise company’s main page, but somewhere in the endless Google searches my husband found what ended up being our solution: having the wedding itself on the cruise ship! While it sounds deliciously decadent, shockingly it ended up our most affordable option.
Here’s a rough cost breakdown:
Ceremony and Reception: $2000 for up to 20 guests, $30/each thereafter. We ended up paying about $250 for going over the limit, so $2250 total. The reception was an open bar and included a selection of 10 appetizers.
DJ: $100. We provided the CDs with music, he was just the host.
Flowers: $100. Basic bouquets.
Bride’s apparel: $600. I bought a sample dress for $110 and had it tailored. This amount also includes my accessories.
Groom’s apparel: $200, tuxedo rental. Though pricey, a tux was one of his non-negotiables and going through the cruise company was cheaper than having to rent a tux for the entire week of the cruise.
Rings: $300 each, $600 total. My ring is white gold with CZ accent stones and his is white gold. We bought mine off a costume jewelry website and his off Amazon.
“Rehearsal” dinner: $400. There wasn’t actually a rehearsal since the boat docked the morning of the ceremony, but we took our friends and family out for deep-fried seafood the night before we set sail.
Invitations: $500. Note: This is probably the expense I regret the most. Due to a pretty significant miscommunication, we waited until the last minute humanly possible to get invitations sorted out, and we paid for it. Ugh.
Postage: $100. Note: Don’t forget to account for this expense! We had to buy 65-cent stamps for the invitations and then you have to also stamp the RSVP cards. Originally the plan was to do RSVP postcards to save a bit, but since we needed full legal names and birth dates with the RSVPs to comply with cruise ship regulations, this didn’t end up being feasible.
Wedding website: $100. This was for one year of hosting service, which is about how far in advance you want to start notifying people of a cruise wedding anyway.
Bridesmaid’s gifts: $300. I bought their jewelry for the wedding as well as took them out to a fancy brunch, since they planned the bridal shower in my state and a bachelorette party in the state where the wedding was held, despite the fact that neither of them lived in either of those states.
Favors: $150. This one was almost a fight, too, since the favors he wanted were really expensive. However, since we had fewer than 30 people attending when all was said and done, we could spring for this.
Photographs: $1000. Note: this seemed expensive to me, but apparently a professional wedding photographer usually runs $3000 or more. Our photographer was actually included in the cost of the wedding, so the $1000 is only for the prints we purchased and digital copies of those prints. He also turned them around in THREE DAYS, which is apparently unheard of in “normal” wedding photography circles. And everyone agrees that they’re stunning.
Flights, hotel, and other transportation: $1500. We live in Arizona and the cruise departed from Florida, so we would have spent this regardless. It’s also worth noting that my friends and family all are from Florida and having the wedding there was the only way a lot of them could afford to come. Additionally, we ended up having to pay the overweight luggage fees because we weren’t willing to pack light for our own wedding.
Cruise: $2200. This was a seven-day western Caribbean cruise with four ports of call. We also stayed in one of the nicest cabins on the ship — we had a living area, plenty of closet space, and a balcony.
Spending while on cruise: $1300. This included excursions like snorkeling with sting rays, zip lining in Belize, tubing through ancient Mayan caves, alcoholic beverages while on the cruise, and all gratuities.
Total: $11,400
Since the wedding actually happened while the ship was in its home port, guests could attend even if they weren’t coming on the cruise. Since they weren’t obligated to cruise with us, and most of the guests would have had to travel to us even if we’d gotten married in our home state, the wedding was no more or less a burden to attend than it would have been otherwise. And four of our friends did end up joining us on the cruise, which ended up being even more fun than a honeymoon alone!
The Aftershocks Afterglow
We managed to pay for about half of these costs prior to the wedding, and ended up with credit card balances of approximately $5000 that still need to be paid off, or about $2500 apiece (we haven’t combined finances yet). However, it’s also worth noting that I fully paid off my last remaining $2500 in credit card debt during the year prior to the wedding. On the surface my balance hasn’t changed, but this means I know I can pay off my share of wedding debt within a year, since I’ve basically done it before.
While I will admit that I started off resenting every penny and every minute of my time I spent on the experience (remember, I wanted to elope), I had an amazing time and appreciated the opportunity to reconnect with family and friends a lot more than I thought I would. And while he started off resenting that we weren’t taking advantage of every upgrade available, after everything was said and done he agreed that everyone considered every aspect of our wedding to be very classy, indeed.
What Do You Think?
Are we heroes to be commended for spending less than half the national average? Complete and total fools duped by consumerism and the wedding racket into spending way more than we should have? Have you ever had an experience with a romantic partner where initial opinions differed so radically on an issue of such significance? If so, how did you resolve it?
Inside: Learn how to invest $100 and make $1000 a day using these proven strategies. Find out the best ways to invest 100 dollars. Many from the comfort of your own home.
One of the biggest mistakes that people make with money is not investing.
You see, if you invest $100 and earn 10% interest a year, in just 12 months your investment would be worth $120!
It takes money to make money.
We all have heard that before.
Many people want to make some extra money, and that is why they are turning their attention to investments. There are a lot of ways to invest your money safely, but most importantly it should be done with a goal and for the long term.
The article will help you to invest $100 now to start making $1000 a day. Will this happen overnight? Nope. That would be some get-rich-quick scheme.
You must be willing to invest the time, resources, and money to start making $1000 a day.
If you are looking to invest $100, this guide will help provide you with the knowledge and strategies to generate a constant stream of income of $1000 a day.
Is Investing $100 To Make $1,000 A Day Possible?
There is no one-size-fits-all answer to this question, as the success of any investment depends on a number of factors. But, yes, many people have found ways to invest $100 to make $1000 a day.
There are a few strategies that investors can use to increase their chances of reaching $1,000/day. That is the part that takes commitment.
Best Ways to Invest 100 Dollars
There are a lot of different things you can invest your $100 in. You could put it into stocks, bonds, or even real estate. Those are the most effective strategies with the least amount of time commitment.
However, there are other options as well, which we will go into detail shortly.
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
What should I invest $100 in right now?
Whatever route you decide to take, remember that investing is a good way to learn and make money.
Not only will you likely see an increase in your overall wealth by investing your money, but you’ll also be happier because of the positive impact it has on your life!
How to Invest $100
You can take your $100 and invest it into the stock market or a savings account. Something that immediately starts paying you to make a return.
The other way is you could use that money to buy books and courses on how to make money with any of the ideas below.
Another option would be to invest in a service that others might not have thought of. This could be something like a start-up business or an online course that teaches you how to make money through investments.
There are plenty of ideas on how to invest $100 it just depends on your short-term and long-term goals.
In fact, learning how to make money online for beginners is a hot topic!
The step-by-step guide to making money with this simple trick
If you’re looking for a step-by-step guide on how to make money with this simple trick, look no further! In this ultimate guide, we’ll cover everything you need to know about the process.
The first step is to invest $100 per month in order to get started. By doing this, you’ll be setting yourself up for a lifetime of financial security.
In order to make money with this simple trick, you’ll need to follow these simple steps:
Decide How You Plan to Make $1000 a day
Invest in Learning How to Do It
Invest your $100
Stay Persistent
Start making profits!
Will everything work out as simply as that? No, but you have to commit to a plan in order for it to happen!
Once you’ve invested in your future, it’s time to learn how to be successful and start making some serious profits!
Invest $100 Make $1000 A Day – Strategies for Success
People have different strategies for success, and the best way to succeed is by figuring out what works for you.
A strategy that might work well for one person may not be suitable or acceptable in another’s situation.
In this article, we’ll explore a few different strategies for success and how they can help you make money from home or on the job. In fact, many of them I implement to make money.
Idea #1: Savings Account
The best way to start investing is to open a savings account. For every $100 you deposit in a savings account, you will earn about a small amount of interest. This may not seem like a lot, but it can add up over time.
In reality, investing $100 into a savings account is a habit that will continue to lead to saving higher amounts of money. While you may not be able to make $1000 a day off your first 100 dollars, your efforts will multiply as your saving percentage increases.
In addition, many banks offer special promotions for new customers, such as a $500 bonus for signing up.
To get the most out of your savings account, be sure to shop around and compare rates at different banks. CIT Bank offers some of the highest interest rates available, so be sure to check them out!
Idea #2: Retirement Accounts (401k or Roth IRA)
Investing in your 401(k) is a great way to secure your financial future. Not only do you get matched contributions from your employer, but the tax benefits make it easy for employees to invest. Contributions are tax-free until retirement, so it’s a good place to put money while you’re working a side hustle or contract gig.
A solo 401(k) is a great way to take advantage of these benefits if you don’t have an employer.
In addition, investing in a Roth IRA is a smart idea as well.
Idea #3: Invest in Cryptocurrency
Cryptocurrencies are digital or virtual tokens that use cryptography to secure their transactions and control the creation of new units. Cryptocurrencies are decentralized, meaning they are not subject to government or financial institution control. Bitcoin, the first and most well-known cryptocurrency, was created in 2009.
Cryptocurrencies have experienced a wild ride over the past year! In the past five years, bitcoin prices have swung from a high of $68,000 in November 2021 to the lowest dip of $3236 in December 2018 (source). Many experts believe that crypto will be adopted widely in the future, and some predict that one Bitcoin will be worth $200,000 or more.
Investors can purchase a range of cryptocurrencies through reputable platforms such as Coinbase and Bitstamp. The most common crypto are Bitcoin, Ethereum, Litecoin, and USDC (a stablecoin pegged 1:1 with USD).
Idea #4: Invest In The Stock Exchange
Like an active trader – either as a day trader or swing trader.
When you invest in the stock market, this is a way to make money on your investments.
In fact, you can make money fast in stocks. But, you need to have a solid trading plan first.
My favorite course is Trade and Travel with Teri Ijeoma. In fact, check out my Trade and travel review and begin your journey to making $1000 a day.
Idea #5: Peer-to-Peer Lending
If you’re looking for a solid investment opportunity, peer-to-peer lending may be a good option for you.
Peer-to-peer (P2P) lending service that connects borrowers and investors. Because it’s a peer-to-peer platform, it can be more profitable for the investor.
Both Lending Club and Prosper are examples of investment platforms in this space.
Idea #6: Become an Entrepreneur
There are many options for entrepreneurs to make money. You can start a restaurant, retail store, or offer your services for a fee.
Another great way to make money is by investing in something you’re passionate about. For example, if you love cars, you could open a car detailing business. This requires some planning and dedication but can be very rewarding.
As an entrepreneur, your goal is to invest in ways that have the potential to turn over $1000 per day.
Idea # 7: Invest in Yourself
When you think about it, the best investment you can make is in yourself.
If you have 100 to invest, find what you are missing and fill it with new knowledge. Learning never stops – it’s a continuous process that will help you grow as an individual and stay ahead of the competition.
This is one area where you have the possibility to make well beyond just $1000 a day.
In fact, many of the best millionaire quotes focus on investing in yourself.
Idea #8: Invest Money in Index Funds
Outside of retirement accounts, many people overlook investing in the stock market as an individual.
Index funds have been a popular choice for investment managers for many years. They are a type of mutual fund that tracks the movements of an index, such as the S&P 500 Index. Because these types of funds follow an index, they provide diversification and typically come with lower fees than actively managed funds.
For these reasons, investors may want to consider using index funds when building their taxable investment portfolio.
Idea #9: Enroll in a Course or Certification
There are many different courses and certifications you can take to improve your skills.
This “new skill” could help you transition into a different career. A “certification” might help you get promoted in your current position, or it might allow you to begin working in a new field.
Either way, you are investing $100 or more today to make 10x your money in the future. Consider what skill can be useful in your professional or personal life and invest in a course.
Idea #10: Clear Your Debt
Paying off debt is a guaranteed return on investment.
This may seem a little backward but hear me out…
If you add an additional $100 to paying off your debt consistently, that means you are that much closer to freeing up a huge amount of debt payments to go somewhere else.
In this case, your overall debt payment can be invested in other ways and you will quickly improve your rate of return.
Idea #11: Work As A Sales Person
Commission payments are a large part of income for salespeople. In fact, US News reports that the average sales professionals earn an average salary of $73,500 in 2020.
This is a competitive field, but it can be very rewarding for those who are driven to succeed.
You probably will have to invest in a business degree to make this career field worth it.
Idea #12: Write A Book
Books are a great way to make money. They are one of the few investments that can be made with the intent to generate passive income. In other words, you put in some work at the beginning and then receive payments over an extended period of time without having to do anything else.
Writing a good book is an easy way to make money in 2023. As an independent self-publisher, if your book sells 100 copies per day at $10 each, you will make $1000 on every copy sold.
Publishing companies can help pay an advance for your work and handhold you throughout the process. You might need skills beyond writing if you want your book published at one of the larger publishing companies.
If you are serious about becoming an author, it is best to go through a publishing company and have them edit your work for you. This will ensure that your book is high quality and likely to sell more copies.
Remember: publishing a book is not cheap! It takes a lot of hard work and dedication, but if done correctly it can be an excellent way to make 1000 dollars a day or more.
Idea #13: Become a Book Nerd to Build Skills
Investing in books is a way to improve your knowledge and increase productivity. It’s impossible to become an expert in every field, but it’s possible to become one by reading about them. Books can change the way you view life and give you fresh perspectives on how to handle finances, as well as other aspects of life.
An investment of $100 in 2023 would yield $1000 or more depending on the non-fiction niche books you choose.
So, what are you waiting for? Start reading!
Idea #14: Online Flipper
So you want to flip 100 bucks to 1000? Well, it’s not as hard as you might think. In fact, with a little bit of effort and some basic knowledge, you can turn that hundred into a thousand in no time at all! Here are a few tips to help get you started:
Find something to flip. This could be anything from furniture to clothes to electronics. Keep an eye out for items at local retailers that are on sale and look like they could be resold for more online.
Know your market. What is the average price for the item you’re looking to sell? Knowing this information ahead of time will help make sure that you don’t sell your product for too little (or worse, too much).
Have the proper tools ready before starting your flipping business. This includes having a good camera or phone with which to take pictures of your products, a computer or laptop with which to list them online, and PayPal or another payment processing system set up and ready to go.
Be prepared for some work! Flipping isn’t always easy–you may have to spend time researching what items are selling for how much online, traveling long distances to find good deals or dealing with frustrating customers.
A great way to get started is to learn more from the Flea Market Flippers! They are very successful and teach others how to flip items
If you’re willing to put in the effort, flipping can be a great way to make some extra money on the side.
Idea #15: Invest in Real Estate
There are a number of great reasons to invest in real estate in 2023. In fact, real estate is one of the best investments for making money.
To start investing today, set aside a few hundred dollars each month and invest in real estate over time. This will help you build your wealth slowly and steadily.
Ways to Invest in Real Estate:
Rental Properties: Investing in rental properties can prove profitable with monthly renters and appreciation from rental income or capital gains as a property is worth increasing over time. However, rental properties require more upfront money and more work to maintain than other types of real estate investments.
Flip Houses: Another option is buying properties at low prices, fixing them, and selling them for a quicker profit.
REITs: Real estate investment trusts are a great way to access real estate much like mutual funds. These are highly regulated. However, learn about the best paying jobs in REITs.
Crowdfunded Options: Crowdfunded real estate can be accessed by anyone with a little bit of money – you don’t need to be a millionaire to get started! The returns tend to be more significant than the stock market so it’s a good choice for beginners. Plus, EquityMultiple lets you invest in real estate without worrying about managing a property yourself. It’s possible to make $1000 per day through EquityMultiple, depending on the time frame and market conditions.
Between crowdfunded real estate, rental properties, and REITs – there are plenty of options to choose from when it comes to investment vehicles. Each has its own unique advantages and disadvantages, so it’s important to do your research before settling on an option.
Overall, though, investing in real estate is a great way to grow your wealth and secure your financial future!
Idea #16: Get a New High Paying Job
There are many high paying jobs in the world, but the skill necessary to get one of those jobs is managing people. People who manage other people are able to get paid more because their skills are rare and in high demand.
Management positions are typically the highest paying, but there are also many other responsibilities as well. other lucrative options to consider.
This will help you find more money to invest on a regular basis and start making more money each day.
Idea #17: Affiliate Marketing / Influencer
Affiliate marketing is a great way to make money online. In fact, many affiliate marketers earn six figures or more per year. So what is it?
Affiliate marketing is the practice of advertising a company in exchange for payment. Affiliate marketers work with blogs to post about products and services, which makes them eligible for receiving payment when someone clicks on the link and purchases something from the company they’re advertising for.
It’s not likely that you’ll make this kind of money right away, but as your influence grows, you can certainly make some good cash through affiliate marketing programs.
The costs associated with getting started are relatively low–you can probably get started for less than $100–and it takes about the same amount of time to build up your blog’s audience and reader base from scratch. So if you’re looking for a solid way to generate some extra income online, give affiliate marketing a try!
Idea #18: Start Your Own Blog
With just $100, you can start your own blog and make money.
Blogging is a great way to make money and requires little in the way of cash or startup costs. In fact, many bloggers start their sites for free and then upgrade to more expensive hosting plans as their blogs grow in popularity. The cost of starting a blog is minimal and you’ll need to find your topic to write about first, but it’s possible over the course of years.
There are many different types of blogs that can be started with their own benefits – from personal finance advice to cooking tips – so finding the right one for you is essential.
To monetize your blog, consider offering services or digital products to consumers interested in what you have to say on the topic of your blog’s content. For example, if you’re a great cook, you could start a cooking blog and sell recipes through an online store; or if you’re an expert on personal finance, you could create e-courses teaching people how to save money and invest for their future.
Blogging is a long game; SEO traffic requires patience, but the payoff will be worth it in time. It can take anywhere from 6 months to over 18 months for bloggers to start seeing results. However, those who stick with it and reinvest their profits back into their sites can make $1,000/day from their blogs.
So what are you waiting for? Start blogging today!
Idea #19: Charity
Philanthropy is an excellent investment, so donating to charity is a wise choice.
Not only do you help others in need, but you may also be rewarded with tax breaks or other benefits.
Additionally, many charity works are good investments because of the promise of reward. For example, building a well in a developing country can provide access to clean water for years to come.
Look for ways to give where your donation can be matched.
Idea #20: Save For College
You can invest $100 and make $1000 a day by saving it.
One way to save for college is to invest in a 529 plan. A 529 plan allows you to save money for college tax-free. In addition, many states offer tax deductions or credits for contributions made to a 529 plan. Another benefit of a 529 plan is that the money invested grows tax-deferred. This means that you don’t pay taxes on the earnings from your investments until you withdraw them from the account.
Many parents find it difficult to save for college because they face high tuition costs and other expenses associated with sending their children to school. However, if they start early and contribute small amounts on a regular basis, they can accumulate enough savings overtime to cover most or all of their child’s education costs.
Idea #21: Use Gig Economy Apps to Earn Money Fast
Now, it’s easier than ever to find work. There are a number of apps and websites that can help you find short-term or long-term work. These include apps like:
These apps provide a new way for people to make money when they’re not working traditional jobs.
How can I invest $100 and make money everyday?
There are a variety of different ways that you can invest your money in order to make a profit.
The most hands off approach for many is investing in index funds. As a buy and hold strategy, you are likely to earn 6-8% plus on your investment.
As you hold onto the index fund for the long term, you are able to participate in any upside should the stock prices go up.
Invest $100 to Make $1000 a day is possible!
It’s true–you can make a lot of money by investing just a small amount at first. For example, if you invest $100, you could earn up to $1000 in profits! This is possible by following the strategies outlined in this article.
When you need to know how to make 2000 fast, this is how you do it!
Of course, it’s important to remember that investing isn’t limited to those who have a lot of money. In fact, anyone can benefit from this type of activity financially and make more money in the process.
So don’t be discouraged if you don’t have much saved up already. You can start by investing $100 into the stock market and then reinvesting your profits as soon as possible, in order to grow that initial investment. And who knows? With a little bit of hard work and patience, you could be making thousands of dollars per day before you know it!
This is how you can double $10k quickly.
Don’t delay in investing. You have to start at one point to start making money.
Then your next goal will be how to turn 10k into 100k.
Know someone else that needs this, too? Then, please share!!
Most mortgages carry a 30-year term, even if they’re adjustable for some period of those three long decades.
But in some cities, it’s reasonably possible to pay off your mortgage a lot earlier thanks to low home prices and decent wages.
Now, this isn’t to say you should pay your mortgage down aggressively…it’s just that you could, if you were so inclined.
Unsurprisingly, most of the cities in the top 10 list can be found in the central states, like Ohio, Michigan, and Missouri. But there are also spots in Pennsylvania and New York where home buyers can get free and clear in no time at all.
The Fast List
The data nerds over at Realtor came up with the list above by calculating median home prices in the top 50 markets in the U.S. and lining them up with the recommended 28% housing DTI ratio.
The result is a short 5.4 years to pay off a median priced home of $128,000 in Cleveland, Ohio. Sure, your football team won’t be very good, but at least you’ll have a football team.
And if you focus on tackling the mortgage, you’ll only have to pay taxes and insurance on your digs in little more than half a decade.
That’s certainly pretty cool if you’re not one to carry lots of debt. And you might get a decent water view on the “North Coast,” a term I’ve never heard until today.
You can pull off the same magic in cities like Rochester, NY, Pittsburgh, PA, and Buffalo, NY.
There are plenty of other major metros on the list as well, including the likes of St. Louis, Indianapolis, Cincinnati (hard to spell, but decent football), and Kansas City (great baseball).
In Indy, some 71% of the homes are affordable to prospective home buyers, and St. Louis was deemed a top 10 up-and-comer by Realtor.com thanks to strong projected home sales and future home price appreciation.
So if you don’t want to worry about the mortgage for more than a handful of years, as opposed to into your old age, check out those cities. You may even be able to take out a 15-year or 10-year fixed mortgage at the outset to save a ton in interest and grab a lower mortgage interest rate.
Conversely, if you want to keep your mortgage forever, look at these 10 superstars.
The Slow List
In Los Angeles, it will actually take you nearly the full 30-year term to pay off your mortgage. The annual income of around $100,000 in the 90210 requires a lengthy 29.4-year amortization period.
So no 15-year fixed for you unless you’re making big bucks. You’ll need a 30-year mortgage.
The same goes for much of the Bay Area, including San Jose and San Francisco, and in sunny San Diego. That explains why lenders are increasingly offering zero down mortgage options like the POPPYLOAN.
Hot cities such as Denver are starting to get a hair expensive too seeing that it’ll take the average buyer 21.3 years to pay off the mortgage without breaking the bank or raiding the retirement nest egg.
It’s a little bit better in places like Miami and Portland, but these cities are clearly getting more expensive as homeowners from nearby states (and countries) flock to affordability.
However, there are still some relative bargains to be had in places like Sacramento, California and Austin, Texas where it can take less than 15 years to get mortgage-free while still saving for retirement and living comfortably.
Save more, spend smarter, and make your money go further
While Financial Literacy Month may be over, we at Mint live for sharing personal finance tips and tricks all year long!
MintLife readers recently joined a group of consumer finance experts during our #Money411 Twitter chat to discuss better money habits. Did you miss it? Not to worry: we couldn’t pass up sharing some of our favorite chat highlights and money saving tips.
Q: What are the first steps to take when establishing a budget?
Write or type it down. Seeing it will help you see what you are missing. Don’t forget the small stuff either. – @DebbiKing
Start by adding up monthly expenses and subtract from monthly income, then plan how to spend remaining $$ – @hperez
Realize that sticking to a budget does not happen right after you make one. You have to live it. Try it out for 3-6mo. – @dougboneparth
Q: What are your #tips for first time young investors?
DON’T ignore your first job’s 401(k) plan, if they have one, even if you put in just a little bit of each paycheck. – @OurKidsandMoney
Make sure you’ve covered your expenses (include CC bills) and are saving for emergencies before you start investing. – @sharon_epperson
Q: What is more important: paying down #debt or #saving?
The sooner you pay off debt, the sooner you’ll have additional income you can dedicate to saving – @hperez
It’s hard to save when your extra income is going toward debt payments. If you have debt with high interest rates, focus on that. – @TeamFSINC
Remember, certain types of debt like mortgages and student loans (dep on your income) are deductible. If interest on a loan is deductible, it costs you less…so factor that in when prioritizing paying down hi to low debt. – @BethKobliner
Q: How can you teach your kids about the value of money? And at what age?
Kids as young as 3 years old can understand basics like making choices and delaying gratification! Important 2 start early – @BethKobliner
It’s never too early to teaching kids about #money and #finance. Financial literacy is paramount. Classroom it! – @dougboneparth
The topic of the tooth fairy is a time to talk to your children about money. Ask how much they plan to spend and encourage to save. – @TeamFSINC
Kids learn by example (any age) Show ’em anything acquired is earned not given. Make ’em feel pinch of spending their earned $ – @PurpleSky2002
Q: What is the best approach to tackling student loans?
#1 Priority. Try to refinance all of your loans into one lower rate loan. Sacrifice a new car, an expensive vacation. – @Reit_NotWrong
Don’t buy the stuff that your peers buy out of college. (Houses, cars etc.) I paid down $40,000 in a year and a half that way. – @GenYMoneyMan
Aggressively! They are not an asset & you do not need to hold on to them. Sacrifice and get rid of them as soon as possible – @DebbiKing
To catch the entire Twitter chat, just plug #Money411 in your Twitter search bar and get started on better money habits.
Save more, spend smarter, and make your money go further
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Are you looking for a way to secure a loan, but do not have the credit rating or typical collateral in order to do so?
Then you might want to consider the assignment of life insurance policy as collateral for a loan.
This relatively new field in the obtainment of loans uses your own life insurance policy as the means for you to obtain the type of loan you want.
The collateral assignment of life insurance policy proceeds is a relatively simple one, but there are a few steps that need to be taken before you can take full advantage of this method.
Finding Insurance Companies That Allows Collateral Assignment
The first question before the assignment of life insurance policy as collateral for loan can be processed is whether your life insurance company will allow it to happen. Many of them do have specific requirements and they need to be followed for the collateral assignment of life insurance policy can take place.
If the answer is no, at least you can eliminate that method to obtaining your loan and in the future obtain a life insurance policy that will not have these restrictions.
Most of the insurance carriers that we work with do allow for collateral assignment of your policy so as long as you identify a lender that will accept it.
There are companies out there that specialize in working with both lenders and life insurance companies that can help you obtain the goal of collateral assignment of life insurance policy for the purposes of getting a loan. In most cases, they follow a step-by-step approach that starts with contacting the lender to see what type of life insurance qualifies as collateral. The company will insure getting the exact wording necessary so that the next step can be taken.
Now you apply for the life insurance that qualifies for the loan, in some cases it may not need a medical exam which generally is more expensive but can be done in a few days or it may require an exam and be fully underwritten which is less expensive but takes a few weeks. If you currently have a policy that qualifies for the assignment of life insurance policy as collateral for the loan, then this step can be avoided.
Do you need lief insurance fast? Are you in overall good health? There are guaranteed acceptance insurance policies and simplified issued policies that require little to no medical exams and are issued rather quickly.
Lender Accepting The Insurance Policy Proceeds As Collateral
The lender will now accept the life insurance as collateral for your loan, usually they are consulted beforehand to insure that all the wording and legal language requirements are met and that the application is essentially approved before it is sent in to avoid any unwanted surprises.
Once it is approved, then the forms are signed by both the lender and the life insurance company so that the process can take the final step of providing you with the loan that you need.
Sample Collateral Assignment Form
This rather straightforward process can be quite technical in nature and needs an experienced, knowledgeable company to make the transaction work so that you can get the loan you desire while satisfying the needs of both the lender and the life insurance company. This way, all the potential problems are ironed out beforehand and you get the loan you want.
If you are looking for another method to obtaining a loan, then using your life insurance policy proceeds or having one drawn up can be the way to get what you need.
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Collateral Assignment Example
We recently had a real estate developer who needed a $4 million term life policy to cover his bank loans. He was needing to get his life insurance fast, so we went with the carrier we felt would issue the quickest based on his situation.
Within 4 weeks the policy was in-force and he was completing the collateral assignment forms to hand over to his banks. Keep in mind that the assignment forms do not need to be completed until after you receive your policy from the insurance company.
Life Insurance For Your Family
The idea of using a life insurance policy as collateral is a relatively no idea. These plans are an excellent way to secure a loan that you wouldn’t be able to get otherwise. One thing to always be aware of is the life insurance protection that you’re giving your loved ones. Life insurance plans are a great way to close a loan, but that’s not the main reason of these plans.
Regardless of why you’re buying life insurance, there are plenty of options for you to choose from. If you want the cheapest, you should buy a term plan with a medical exam.
The required medical exam is pivotal in deciding how much you pay. The better results that you get from the medical exam, the lower that your insurance rates are going to be.
Aside from the medical exam, there are several other key factors which can change how much you pay. One of those is tobacco usage. If you smoke, you’ll need to set aside twice as much for your plan.
Thanks to ongoing economic turmoil, mortgage rates are now on sale again, so much so that mortgage refinancing is picking up steam and lifting overall mortgage applications.
Mortgage rates have now fallen for six consecutive weeks, per data from Freddie Mac. The popular 30-year fixed-rate mortgage now sits at 3.65%. It was averaging a much higher 4.01% as of December 31st, 2015.
Some lenders are now offering rates as low as 3.375% on the loan product, a steal for anyone looking to purchase a home or refinance.
Interestingly, purchase volume has still been pretty flat, per the Mortgage Bankers Association, so it’s unclear if the low rates are pushing folks to look for homes. But it’s clearly motivating individuals to look into a refinance.
I looked at some of the larger lenders to see just how low interest rates are at the moment.
What Rates Are Lenders Offering Today?
This is what I saw offered on February 12th, 2016.
One lender, CashCall Mortgage, famous for their no cost refi, is offering a 30-year fixed with no closing costs for 3.625%. They’ve also got a 15-year fixed set at a promotional rate of 2.99% with no fees.
If you actually pay your closing costs out of pocket you should be able to get a rate at least as low as 3.5% on the 30-year, which is pretty much as low as it has been.
Greenlight Loans is offering a rate as low as 2.75% on the 15-year fixed, though the APR is a higher 3.003%.
Wells Fargo is displaying rates of 3.75% on the 30-year fixed and a rather high 3.25% on the 15-year fixed.
Chase is offering 3.5% on the 30-year fixed with APR at a very low 3.56% as well. They’re charging .75% in discount points for that rate. Their 15-year fixed is also a low 2.875%.
PNC Mortgage is advertising a range of rates on the 30-year fixed from 3.5% to 3.875%, and rates as low as 2.75% on the 15-year fixed.
Flagstar Bank Is Advertising a Rate of 3.375%
The lowest rate I’ve seen advertised by the top 10 mortgage lenders is the 3.375% on offer at Flagstar Bank. The APR is a low 3.535% as well, so closing costs don’t appear to be exorbitant.
If you recall, the 30-year fixed hit its lowest point on record (per Freddie Mac) during the week of November 21, 2012, averaging 3.31%. So it’s pretty much there again.
Over at Bank of America, they’re offering a 30-year fixed for 3.625% with about a half a discount point charged.
At U.S. Bank you can get a jumbo 30-year fixed as low as 3.625% with similar APR. Their FHA 30-year fixed is currently 3.5%, but APR is over 5% because of pricey mortgage insurance premiums.
There are also some major duds out there. Somehow CitiMortgage is advertising rates of 4% on the 30-year fixed, though they aren’t charging mortgage points.
Still, that’s way higher than the competition. Their 15-year fixed is also set at a pricey 3.375%.
PHH Mortgage is also advertising a relatively high 3.71% rate for their 30-year product and 3.125% for their 15-year fixed.
PennyMac Mortgage, which rose from the ashes of Countrywide Mortgage, is offering a pricey 3.875% 30-year fixed and 3.25% on its 15-year fixed.
Interestingly, their 5/1 ARM is more expensive, advertised at 4.125% today.
Remember, while rates are low, it can all change in a hurry. Of course, with how bad the global economy looks at the moment, we could see rates trickle down even further in 2016.
I’ve heard the Chinese housing bubble might make ours look like a walk in the park.
I suppose it’s possible the 30-year fixed could dip below 3%, but we’ll be in really bad shape if that’s the case.
Many people hit a period of financial hardship at some point in their lives. Maybe there’s a medical emergency and big bills, a job layoff, or a family member in serious need: These and other scenarios can put your money management in a precarious position.
Approximately 70% of Americans report feeling stressed about money, according to a CNBC/Momentive survey. This can be centered on anything from living paycheck to paycheck to worrying about saving for one’s (and one’s family’s) future.
Here, you’ll learn more about what happens when financial hardship hits and how to take steps to improve the situation, from applying for assistance to negotiating with lenders to discovering new sources of income.
What is Financial Hardship?
Everyone probably has their own definition of “economic hardship” that’s based on their own needs and wants. And the federal government has its own criteria for what counts as a “hardship” when it comes to taking an IRA distribution, looking for tax relief, or requesting a student loan deferment.
But generally, a financial hardship is when an individual or family finds they can no longer keep up with their bills or pay for the basic things they need to get by, such as food, shelter, clothing and medical care.
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Warning Signs
Sometimes financial difficulties can sneak up on a person, and catch them completely off guard. And sometimes, the warning signs have been there for a while, but were missed or ignored.
Identifying the root cause of financial distress can help give you a head start on working through your money issues. Here are some red flags that might signal a person is headed for financial distress:
Having Credit Card Balances At or Above the Credit Limit
While using credit cards may seem like a good way to get around a short-term lack of funds, the practice could lead to extra fees and a lower credit score. The percentage of available credit someone is using — known as a credit utilization ratio — can indicate to lenders how heavily they’re depending on credit cards to get by. And because it’s one of the major factors in determining a person’s overall FICO score (a credit score lenders use to determine whether to extend credit to a borrower), financial advisors typically recommend keeping card balances at or below 30% of the limit.
Juggling Which Bills Get Paid Each Month
It may be tempting to skip a payment from time to time, hoping to catch up eventually — but there can be short- and long-term consequences for juggling bills. Insurance coverage may be lost. There may be a late fee, or a bill could be turned over to a collection agency.
Utilities can also be shut off, and a deposit might be required to restart the account. Making late payments on a credit card could lead to a higher interest rate on the account. And late payments and defaults can hurt credit scores.
Only Making Minimum Payments on Their Credit Cards
It may be necessary to make minimum payments if times are especially tight, and there likely won’t be any short-term harm. But even if the cardholder stops making purchases, just the interest charged will keep the account balance growing, possibly extending the amount of time it takes to pay down that debt by months or years.
Often Paying Late Fees or Overdraft Fees
A one-time mistake may serve as an annoying reminder to be more cautious with money management, but if late fees, overdraft and non-sufficient funds fees, and overdraft protection transfers become a regular thing, they can add another layer of worry to a person’s financial burden. (Using alerts, automatic payments, and apps from your financial institution may offer a more effective method to track bills as well as deposits and withdrawals.)
Having a High Debt-to-Income Ratio
Lenders often use a person’s debt-to-income ratio — a personal finance measure that compares the amount of debt you have to your income—to determine if a borrower might have trouble making payments. If a person’s debt-to-income ratio is high, it could make it more difficult to borrow money, or to get a good interest rate on a loan.
Tapping Retirement Savings to Pay Monthly Bills
In certain cases, the IRS will allow an account holder to withdraw funds from a 401(k) or IRA to cover an immediate and heavy financial need (such as medical expenses, payment to avoid eviction or repair home damage) without paying the 10% early withdrawal penalty. But taxes will still have to be paid on those distributions. And taking that money now, instead of letting it grow through the power of compound interest, could have serious repercussions for the future.
Dealing with Financial Hardship
For those who’ve been struggling for a while, or who’ve had a sudden but substantial financial loss, it might feel as though they’ll never recover. But there are several options those who are experiencing financial trouble might consider taking to get back on track. Some they can do for themselves, while others might require getting financial hardship help from others. And while some might be temporary, others take a longer view. Here are a few:
Reducing Monthly Spending
Creating a monthly budget can help individuals and families prioritize and guide their spending decisions. This may involve prioritizing your monthly expenses, starting with the essentials and going down to the “nice to haves.” Once you’ve established which expenses are the most important, you may then be able to look for places to cut back or cut out of your budget altogether. Cutkacks may not feel fun, but they can help jump-start your recovery.
For example, could you cut costs if you cooked meals yourself more often? Are you trying too hard to keep up with what friends and family are spending on clothes, vacations, and cars? Are there monthly bills that could be reduced (could you save money on streaming services, internet, and phone services; manicures and other beauty treatments; or even rent, insurance, or car payments)? It may help to start by tracking expenses for a month or so to get an idea of where money is going, and then sit down and map out a more realistic path for the future.
Creating a Debt Reduction Plan
Along with a budget, it also may be useful to come up with a plan for paying down credit card balances, student loans and other long-term debt. It’s important to always make the minimum payment on all these bills, if possible, but a personal debt reduction plan could help with prioritizing which bill any leftover money might go toward after all the household expenses are paid each month — or the money might come from a tax refund, bonus check from work, or a gift. Knocking down debts that include high amounts of interest can eventually free up more cash to put toward short- or long-term savings goals.
Looking for Ways to Earn Extra Income
Is there a way to turn a hobby, skill, or interest into some extra funds? Maybe a favorite local business could use some part-time help. Or, if a second job is out of the question, perhaps a side hustle with flexible hours is a possibility. Writers, artists, and designers, for example, may be able to turn their talents into a side business. Babysitting the neighbor’s kids or running errands for an older person are also options. And, of course, on-demand services like Uber and DoorDash are employing drivers, delivery persons, and other workers.
Considering a Loan to Consolidate Bills
Getting a personal loan for debt consolidation won’t make money problems go away completely—but it might make managing payments a little simpler. With just one monthly payment (instead of separate bills for every credit card or loan) it can be easier to keep tabs on how much is owed and when it’s due.
Because interest rates for personal loans are typically lower than the interest rates credit card companies offer (especially if a rate went up because of late payments), the payoff process for that debt could go faster and end up costing less. (Generally, lenders offer a lower interest rate to those who have a higher credit score, borrowers who are already behind on their bills may pay a higher interest rate or have more trouble getting a loan.)
Student loan borrowers also may want to look into consolidating and refinancing with a private lender to get one manageable payment and, possibly, save money on interest with a shorter term or a lower interest rate.
Refinancing may be a solution for working graduates who have high-interest, unsubsidized Direct Loans, Graduate PLUS loans, and/or private loans.
Federal loans carry some special benefits that private loans don’t offer, including public service forgiveness and economic hardship programs, so it’s important for borrowers to be clear on what they’re getting and what they might lose if they refinance.
Notifying and Negotiating
Ignoring credit card payments and other debts won’t make them disappear. Borrowers who can clearly see they’re headed for financial trouble may wish to notify their credit card company or lender and try to work out a more manageable payment arrangement. (There are debt settlement companies that will do the negotiating, but they charge a fee for their services.)
A credit card issuer may agree to a reduced, lump-sum payment or a repayment plan based on the borrower’s current income, or it may offer a hardship program with a lower interest rate, lower minimum payments, and/or reduced penalties and fees. The options available could depend on why a customer fell behind, or if they’ve had problems before.
Financial hardship assistance is sometimes offered by mortgage lenders. Because these lenders generally don’t want their borrowers to foreclose on their homes, it’s in their best interest to work with borrowers when they get in trouble. The lender may be willing to help the borrower get caught up by forgiving late payments, or they may change the interest rate of the loan or lower the payment.
If you have federal student loans and are experiencing financial hardship, you might qualify for a special repayment plan, such as pay-as-you-earn, or an income-based repayment plan.
It can also be helpful to reach out to service providers (such as water, electricity, internet) and let them know you are experiencing financial difficulties. Providers may be willing to work with you and you may be able to come to an agreement well before any shut-off actions go into effect. This can also save you from late fees, or going into collections.
Getting Financial Help
There are also a number of government programs designed specifically to help people overcome sudden financial hardships. Those who’ve lost a job may be entitled to unemployment benefits. If that job provided health insurance, you may want to look into COBRA to see if you can maintain affordable health insurance. Those who were injured at work may be entitled to workers’ compensation.
Also, some people facing financial hardship may qualify for state or federal benefits like Medicaid or Social Security Disability.
Though not free, a financial professional who specializes in planning, saving, and investing may be a worthwhile investment. He or she may be able to offer a fresh perspective and help create a path to financial freedom. There may also be free or low-cost debt counselors available via non-profit organizations.
Preparing for Current and Future Challenges
Once you’ve developed your personal plan for overcoming financial hardship, you can begin working on your goals of becoming more financially independent. If the cause of your hardship is temporary (you were out of work but quickly found a new job, for example), it may take just a few months to get back on your feet. If the problems are more difficult to overcome (you’ve lost income through a divorce, or you or a loved one has an ongoing medical condition that requires expensive treatment), the timeline could be much longer. Once you’ve put your plan in place, you may want to review it on a regular basis, and perhaps do some fine-tuning.
The Takeaway
Many people go through periods of financial hardship, and often for reasons that are beyond their control. But that doesn’t mean they are out of options. There are many simple and effective steps people can take. Cutting monthly expenses, consolidating debt, and getting outside assistance are moves that can help them get back on the right financial track.
Ready to get your finances organized? You also may find it easier to track expenses and stay on budget by separating your money into virtual buckets or “vaults.” SoFi Checking and Savings is an online account that features Vaults to allow members to set aside money for different financial goals, track their progress, as well as set up recurring monthly deposits. What’s more, a SoFi Checking and Savings account offers a competitive annual percentage yield (APY) and charges no account fees, plus you can spend and save in one convenient place.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit can earn up to 4.20% annual percentage yield (APY) interest on Savings account balances (including Vaults) and up to 1.20% APY on Checking account balances. There is no minimum direct deposit amount required to qualify for these rates. Members without direct deposit will earn 1.20% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. These rates are current as of 4/25/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet. 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. Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website . Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners. Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice. SOBK0523024U
Higher mortgage rates may discourage some existing homeowners from selling and giving up record-low interest rates they got over the previous couple of years.
New listings during the four weeks that ended April 23 fell 22.4% nationwide from a year earlier, according to Redfin research. The lack of new homes for sale nationally may have had a positive effect on Dallas-based rental giant Invitation Homes, chief executive officer Dallas Tanner said Tuesday in a first-quarter earnings call.
Rental giant’s new South Texas factory to produce prebuilt homes for D-FW
Tanner said that “lock-in effect” limits supply, supporting home prices and rent growth and keeping renters in their homes. The company, which owned 83,000 rental homes nationwide as of March 31, faces the competitive market itself when selling its own properties.
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“We’re seeing evidence of this supply-and-demand imbalance when we list our homes for sale and receive multiple competing offers at great prices,” Tanner said.
In addition to the lack of inventory of homes for sale, Tanner said rising costs of homeownership are further driving the demand for single-family home leasing.
Nationally, the average monthly cost of owning an entry-level home in the U.S. was $3,428, while the average monthly payment to rent a similar home was $2,130, according to John Burns Research & Consulting.
In the Dallas-Plano-Irving metro division, the average cost of owning a single-family home was $3,389, over $1,000 more than the average cost to rent a similar home at $2,346, according to John Burns data. In the Fort Worth area, homes cost $2,900 to buy versus $2,023 to rent, a difference of $877.
Renting is still far less expensive in Dallas-Fort Worth than in other metros
Tanner said during a recession, more people may stay in rentals and the company could see more opportunities to grow.
“Since our inception, we’ve matured and performed through a variety of operating and macroeconomic environments, including a global pandemic and record-high inflation,” Tanner said. “Throughout this time, we’ve witnessed the resilience and the relative strength of our business.”
The lack of new inventory may also give Invitation an edge over smaller single-family rental companies struggling to grow their portfolios, Tanner said. Invitation, meanwhile, struck a deal with PulteGroup in 2021 to help bring thousands more rental homes to the market.
Nation’s biggest homebuilders could boost D-FW footprint during lending crunch
“As we see some of these smaller operators who are having trouble getting scale or sizing up, there could be potential [mergers and acquisitions] over the next couple of years,” Tanner said.
Investors purchased about 30% of all single-family homes in the Dallas-Fort Worth area last year, according to John Burns data. Companies like Invitation that own more than 1,000 homes represent only a sliver of the local housing market, far surpassed by small investors.
As of March, Invitation Homes owned 2,847 homes in D-FW with an average monthly rental rate of $2,128.
Demographic trends are favoring the company with more millennials reaching its average resident age of 39 and individuals and families wanting the convenience of leasing but the features of traditional single-family homes such as more space, garages and yards for their kids and pets, Tanner said.
“Today’s residents are requesting flexibility and choice, along with the appeal of a down-payment-light lifestyle.”
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Chicago-based technology company Gateless announced this week that Guaranteed Rate, a Chicago-based leading mortgage lender, has implemented its Smart Underwrite solution, a groundbreaking technology that aims to transform the borrower experience.
In a fast-paced real estate market, many potential homebuyers miss out on their dream homes due to the lengthy mortgage approval process. Smart Underwrite aims to significantly reduce the time and effort involved in the process, potentially leading to faster, if not instant, borrower approvals.
“Without a doubt, the capabilities provided by Gateless and Smart Underwrite are groundbreaking,” said Victor Ciardelli III, founder and CEO of Guaranteed Rate. “When Guaranteed Rate introduced the world’s first fully digital mortgage in 2015, it revolutionized the industry. Now, with Smart Underwrite, we can continue to expedite and streamline the process for both our customers and real estate agents. The real-time automation offered by Smart Underwrite is a driving force behind our recently unveiled Same Day Mortgage platform, which enables borrowers to receive same-day approvals.”
Smart Underwrite empowers lenders to digitally analyze and interpret all essential loan data and documentation the moment they are received. For instance, when a borrower submits W2s and paycheck stubs, Smart Underwrite identifies the documents, associates them with the appropriate borrower income source, extracts relevant information, calculates monthly income, and resolves any underwriting conditions.
Not only does it accomplish these tasks instantaneously without human intervention, but it also ensures compliance with guidelines set by Freddie Mac and Fannie Mae. Smart Underwrite utilizes intelligent automation to evaluate other critical credit, income, and asset documents, streamlining the assessment process for real-time loan approvals and eliminating delays.
“This truly represents a historic milestone in the future of mortgage lending,” Rick Lang, president of Gateless, said. “We now have AI completing a significant portion of the loan processing and underwriting work, while virtually eliminating the risk of human error. All of this occurs in real-time, offering the potential to transform the borrower experience in ways that were previously unimaginable.”
This type of automation offers considerable benefits to lenders, according to the companies, including substantial cost savings, improved loan quality, and reduced potential for expensive buybacks. Borrowers gain the reassurance of immediate loan approvals, along with more competitive pricing from lenders operating with a lower cost structure. Realtors also benefit from representing clients who possess full approval and can compete with cash buyers.
This content was generated using AI, and was edited and fact-checked by HousingWire’s editors.