Before you decide to invest your hard earned savings into a real estate investment, you have to understand the numbers. The numbers tell a story: Is there cash flow? What kind of mortgage to select? What is the CAP rate? How variable expenses affect your cash flow? Do your homework first.
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How good are you at staying on top of your credit card spending? Credit cards are a convenient financial tool that many of us prefer to use in lieu of cash, but they can become a thorn in your side if you're not careful. To determine how disciplined you are when it comes to spending with plastic, it may be a good idea to do a self-assessment. Here are five signs that your self-control goes out the window when it comes to buying stuff with your credit cards. If any of these signs seem familiar to you, then it's time to sit down and give yourself a good talking-to.
You can't leave the house without your credit cards. This may be a sign that you are overly dependent on your cards, and that you've grown used to a certain level of spending. Do you really need a credit card every time you pop into town for a litre of milk? When you carry your card around, it's easier to succumb to spending temptations that can add to your card balance. Try leaving it behind once in a while and see if doing so has a positive effect on your card balance and even your spending habits. You might be surprised by the results. Every single thing you buy has to be bought with your credit card. Have you fallen for the pitch that you should put all your financial transactions on your credit card? It's a good thing if you have a rewards credit card, and you are able to pay your bill in full every month to reap those rewards. But if you're keeping a credit card balance, then you need to think about the possible consequences of putting everything you buy on there. Maintaining a credit card balance that grows over time means that you will ultimately find it harder and harder to pay down. Many consumers mistakenly assume that their card rewards will neutralize or make up for their spending. This is not true. Impulse buying has become second nature. Impulse buying gets us all once in a while. But the habit can sneak up on you more easily if you always have a credit card with a high credit limit in your back pocket. In order to curb impulse shopping, you need to regain some common sense and question everything you buy for a while. One way to control your spending urges is to set up a budget and account for all the spending you do. You don't stick to a budget. A budget allows you to become intimately aware of your limits so you don't exceed them, and many responsible credit card users are able to keep their spending in check because of the simple act of budgeting. But it's not enough to set up a budget; you also have to make the commitment to stick to it! Try the free TWF budget to help you. The idea of cutting up your credit cards makes you break out in a cold sweat. Does it make you nervous when you think about leaving the house without your cards? If it does, it's time to think seriously about who is in control - you or your credit card. You should never feel as if you couldn't do without one in your wallet. Many folks have switched to using cash for all their transactions and have actually found it to be a liberating experience. If you can't spot any of the above signs just yet, congratulations. You are still in full control of both your common sense and your credit cards. But don't get complacent yet; it's important for you to always track your credit card usage and how much you spend. So keep your eye on those cards!
It's a common dilemma: Should you put all your spare cash toward paying down debt, or build up your emergency savings-or a little of both?
It's a serious question now. If you lost your job, the average length of unemployment is about 33 weeks-or eight months. That means your emergency fund must be a priority. But should it come first? Let's run some numbers. Your monthly expenses: $4,000 Your debt: $5,000 on a card at 14% interest You have: $500 to apply to debt, savings or both each month. If you stashed $400 each month in your emergency fund, and made only the minimum payment on your card-that's $100, assuming a 2% minimum payment-it would take you more than six years to build up eight months' of expenses ($32,000). And you'd still owe about $2700 on your card. Now let's flip it. If you put $400 per month toward your card, and $100 toward savings, you'd be debt free in about 14 months-and you'd have a tidy $1,400 start to your emergency fund. Now that's real savings, on every front. If you are a real estate investor looking to buy investment property, it is crucial to know how to properly analyze an investment property. If you do your homework in the beginning and buy property the right way, you will be able to make significant passive cash flow. Here are six ways to help you analyze your real estate investment
Our economy probably needs us to shop irresponsibly again and “live beyond our means” in order to give the economy a boost. I never understand why North Americans are the only people where the average resident consumes more than their income.
Some people blame the educational system for not having personal finance classes, but there are ways to learn outside of school too! It’s not like my teacher taught me how to use the toilet. I don’t know about you, but I learned because:
Toilet Training (Personal Finance Style) If you need to toilet train yourself again, here are some tips that expands from what I talked about above: The Need to Save Money In case you are lucky enough to not know the importance of saving money, let this post be the wake up call. You need to save for your own sake! Can you imagine what will happen if you lose your job and can’t find work for 6 months? How will you pay for your mortgage? Do you know what it’s like to live in your car? Do you know how cold it gets at night if you live off the streets? Stop Getting Further Into Debt It’s so strange that so many people just borrow, borrow and borrow. It didn’t matter where either, be it credit cards, home equity line of credit, RESP or others, people just keep taking out money they don’t have! I just don’t get it, but why does it seem like rocket science to buy something only if you have the means? Do you really need that car, the TV, or even that new pair of shoes? What happened to what you already have? Knowing What to Do with Money Without getting into details, you know what to do when you need to go. Money is exactly the same way. Once it becomes second nature to save, you just do it. You don’t think, you don’t regret and you certainly don’t ask why you save. Getting started is always harder though, so here are some common tips that always works: Save up all the income you receive as soon as it gets into your bank accounts Treat your savings like a high security vault that requires maximum clearance before you ever withdraw And best of all, lay out a logical plan (if you want, consulting with someone else could work too) so you can just follow it. At first, you might not be perfect but with practice, everyone can become an expert! Hey, no one is toilet trained when they are born. |
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