Financial Advice from Ray Dalio.

Financial Advice from Ray Dalio.

His first recommendation is to focus on savings, and to think about how many months of living expenses your savings can get you through. Savings, explains Dalio, is “freedom and security.” Savings can also provide you with opportunities. If you need to further your education, start a new business, or invest in a discounted asset, it’s easier if you have extra money. If you can accumulate enough savings to last you for the next 300 months then you can be considered financially independent. 🙂

Dalio’s next advice is about what to do with your savings. He says “it’s important to realize that the least risky investment that you can make, which is cash, is also the worst investment you can make over time. You can judge that by comparing the rate of inflation to the after tax rate of return you will earn.” So if inflation is 2%, and you’re only making 1% on your cash investment then you are actually losing purchasing power and getting poorer. “So you have to move into other assets that will do better over a longer period of time.” This is why some people like myself don’t have a cash emergency fund.

The last advice Dalio gives is a bit of surprise to me. Instead of going with the mainstream and buying an index fund, he suggests that millennials should do the opposite of what their instinct tells them to do. This can be emotionally difficult to pull off. The market reflects the crowd and your instincts will usually lead you to do the same thing the crowd is doing. But herd mentality won’t get you any further than the rest of the herd. So you want to buy when no one else wants to buy. Famous investor Warren Buffett has a similar saying: “Be fearful when others are greedy and greedy when others are fearful.” The best way to approach this last advice for me is to apply original research and critical thinking to your investment strategies if you want to outperform the market. But then again, a lot of people are perfectly happy earning market returns and I think indexing is an acceptable way to invest as well.

Ray Dalio created a 30 min YouTube video about his famous work, Principles for Success. He believes that dreams, reality, and determination can all help to create a successful life. And that pain plus proper reflection will give us the tools to progress. It’s an interesting watch if you’re into mental models and self development.

Motivational speaker Tony Robbins interviewed self-made billionaire Ray Dalio for his book, Money; Master the Game. Ray heads the largest hedge fund in the world, Bridgewater Associates, which has over $150 billion in assets under management.

The All Weather Portfolio.
According to Ray, “there is one thing we can see with absolute certainty: every investment has an ideal environment in which it flourishes. In other words, there’s a season for everything.” The four seasons he refers to are the following.

Inflation.
Deflation.
Rising economic growth.
Declining economic growth.

He suggests that these 4 economic environments will ultimately affect whether an asset’s price will increase or decrease. So for example, bonds should outperform in a deflationary period. Ray elaborates by saying we should have 25% of our risk spread out evenly across all 4 economic seasons. This is why he calls this investment approach “All Weather.” There are 4 seasons in the financial world and nobody knows for sure which one is coming next. So the idea is to keep a balanced portfolio that will not only make us money, but also help protect us against any surprises in the markets. Here are some assets we can allocate to each of the four categories, and keep in mind it’s possible for two of these conditions to overlap.

This is an interesting strategy. I’ve always had a bullish bias towards investing. In other words, my investment decisions are based on the idea that financial markets tend to increase with economic growth over the very long run, so I don’t try to short anything. But Ray’s approach suggests that it’s possible to make money even in environments of economic decline and deflation that doesn’t involve timing the markets.

Asset Allocation.
Using the philosophy behind his All Weather portfolio, Ray has developed the following asset allocation for the average investor which should work with his strategy.

30% stocks via low fee index funds such as the ones that track the S&P 500 index.
15% intermediate-term government bonds.
40% long-term government bonds.
7.5% gold.
7.5% commodities.
And the results speak for themselves. 🙂 This all weather portfolio has performed quite well from 1984 to 2013. During that period, the portfolio earned a positive return 26 out of 30 years. The average annual return was 9.7%. According to Tony Robbins, this portfolio never lost more than 3.95% in any given year over the past 75 years. Gold and commodities are known for being highly volatile in price, but it appears having a 15% allocation in this case might actually reduce portfolio volatility.

Over the last 20 years, Bridgwater had annualized returns of 14.7%. To put that into perspective, the S&P 500 index returned about 8.7%. During the financial crisis Bridgewater even managed to earn a positive, albeit modest return in 2008 when the general stock market was down. So when Ray Dalio speaks about investing, I’m inclined to listen. 😀 It doesn’t matter how poor people are, anyone can at least afford to pay attention.😄

The only thing I’d change about the all weather portfolio is to buy investment grade corporate bonds instead of government bonds because the yields on T-Bills and other government debt are abysmal right now. For me, the key point is to maintain a balanced asset allocation, and rebalance it once a year.

August 11, 2020

How to Managing Stress and Your Finances During the COVID-19 Pandemic

How to Managing Stress and Your Finances During the COVID-19 Pandemic.

By Monika Ritchie.

There’s no doubt that as we weather the coronavirus pandemic, stress has increasingly become a regular part of our lives. As if worries about our own health and the health of our loved ones isn’t enough, many of us are feeling the pressure of financial stress from mounting bills, reduced incomes, and job uncertainty.

That kind of stress can lead to many health issues, and decreasing it is a great way to help us stay healthy in a time when that’s so crucial. So what can you do to manage stress during the coronavirus pandemic? Getting your finances sorted out as soon as possible will go a long way to mitigating your money worries. Pair financial stress relief with tips to take care of your mental health, and you’ll be able to manage this difficult time more effectively.

4 Tips to Take Care of Your Finances During COVID-19.

During this time your health really does come first, but taking care of your finances will alleviate some of the tension and stress you might be feeling. Knowing that your money issues are taken care of will also allow you to focus more on your wellbeing. Here are a few steps to help you move forward:

1. Reach Out to Your Bank and/or Creditors.
The best time to talk to your financial institution is before things have gotten out of hand. Concerned about paying your mortgage? The sooner you reach out, the better. As nervous as you might feel about talking to your bank, keep in mind that a lot of people need help right now, and many banks, credit unions, and lenders are working to support you. They’ll appreciate you being proactive and will help you find solutions.

2. Get Familiar with the Resources Available to You.
Right now, there are a variety of resources available to help you through this difficult time. Whether it’s support during unemployment, deferred payment plans, or other emergency benefits, learn about which programs are for you. Visit this comprehensive coronavirus resource page to find all of the key resources available for Canadians in one spot.

3. Build and Adjust Your Budget for Reduced Income.
If you don’t have a budget, now is a good time to put one together. If you’re facing a significant reduction in income due to the COVID-19 pandemic, then track your expenses carefully and build an emergency budget. If you already have a budget, consider reviewing it to see if you can pare it down and reduce your expenses further. Take advantage of staying home for all this time and implement a no-spend challenge to help yourself save on discretionary expenses.

How to Manage Your Money During an Unexpected Financial Crisis.

4. Stay Safe and Be Aware of Scams.
Unfortunately, even during a worldwide health emergency, scammers are trying to take advantage of the situation. With so many individuals anxious about the state of their health and finances, many are susceptible to frauds around COVID-19. Be wary of any unsolicited emails, phone calls, or other communications, especially ones that request donations or sensitive information. Do not give out any of your personal information to unfamiliar individuals or businesses, and don’t fall victim to text message scams that ask you to get your money by clicking on a link. When in doubt, contact a company or the government directly by looking up their contact information yourself.

Tips to Manage Your Mental Health During COVID-19.

By now, everyone is familiar with the guidelines around social distancing and self isolation, but that doesn’t mean you need to resign yourself to loneliness and zero social contact. Your mental health is just as important as your financial well-being, so check out these six tips for self-care:

1. Connect with Family and Friends.
While in-person visits are not possible right now, phone calls, video chats, and emailing are all great ways to stay in touch with loved ones. You can share photos and videos, favourite songs, recipes, and more. Make it a priority to (remotely) interact with at least one person outside of your house every day. It will do wonders for your mood and emotional health as well as theirs.

2. Catch Up on Unfinished Projects.
For many of us, there are simply not enough hours in the day to catch up on our various chores and miscellaneous projects. If you’re “stuck” at home, it can be a great time to finish these off. Not only will you check some items off your to-do list, but you’ll get a great mental boost from being productive. However, be wary of tacking a project with a higher price tag than what you can afford on reduced income.

3. Use Community Resources.
Many communities across the country have risen to the challenge of providing support services to those who may need extra help during this time. If you have mobility issues or other challenges, you don’t need to struggle alone. Look into programs in your area that can help you with running errands, grocery shopping, and other necessities. On a larger scale, many grocery stores now have options for online shopping and delivery to help with social distancing. Try connecting with your community on Facebook or see if your province has a central resource centre to coordinate offers of help.

4. Get Creative with Exercise.
You may not be able to go to the gym for now, but many fitness providers are offering online and remote classes that you can follow along with. If you’re not really a gym person, you can lift weights and do strength training from the comfort of your own home. Or you can simply put on your favourite music and have a dance party. You’ll burn calories and get a great boost from all those endorphins!

5. Get Outside If You Can.
Most public spaces like playgrounds, parks, and pools have been closed. But going out for a walk, hike, or run is acceptable if you’re doing it in areas that allow you to keep your distance from other people. If that’s not possible, simply sitting on your balcony or in your backyard with a book is a great way to get some fresh air and vitamin D.

6. Reach Out for Help If You Need It.
If you’re starting to feel overwhelmed or anxious with what’s been going on, counsellors and other support professionals are often available for appointments over the phone or online and can help you work through feelings of anxiety, panic, or depression. You don’t have to suffer alone, so reach out if you need to. If you’re not sure where to turn, contact the Canadian Mental Health Association to find services in your community.

When to Ask for Help from Professional Credit Counsellors.
There’s nothing wrong with getting some professional help before you back yourself into an even tougher spot with a do-it-yourself (DIY) debt relief program. Building budgets, accessing government resources, and speaking to creditors can be a daunting task – especially if you’re new to the experience and feeling stressed and overwhelmed. An accredited financial counsellor can help with navigating the resources available to you, building an emergency budget, and working through your options in an objective and pressure-free environment. Don’t be afraid to reach out – the best non-profit consumer credit counselling services are ready to help.

July 16, 2020

How to Ask Rich People for Money

How to Ask Rich People for Money.

Fundraising for charity is an important part of any nonprofit group's work. In the U.S. alone, donors gave almost $287 billion in 2011. Many people who work for nonprofits feel uncomfortable asking donors for money, but without their help most nonprofit groups would not be able to carry out their missions. Learning how to effectively and respectfully ask wealthy individuals for money can help you ensure your charity or favorite nonprofit, federally recognized as 501 (c) (3), group prospers and is able to help those in need.

Part 1 Planning Your Donation Request
1. Compile a list of donors. Before you begin asking for money, it's best to have an idea of who you're going to ask for donations. If you're going door-to-door, that may be as simple as deciding which neighborhood(s) to work in. If you're soliciting donations by phone or by mail, though, you'll need a list of prospective donors to contact.
If you can identify past donors on your list of people to call or write to, you may want to prioritize those individuals as "best bets" - these are people who, given their history of donating in the past, will most likely contribute again to your cause.
Try to identify which people on your list are the most financially stable. You can do this by interacting with the individual to get a sense of his or her finances, or if going door-to-door, look at the houses residents live in and the cars in their driveways. People with large, elaborate homes or flashy sports cars most likely have more disposable income. (Though of course this doesn't guarantee that they will give donations.)
You can also look for potential donors by their other areas of spending. For example, does the prospective donor attend fundraisers for other organizations or individuals? If so, that prospective donor probably has the means to donate to your organization, if properly persuaded.
Consider using analytical software and services, such as Donor Search, to identify which potential donors are more wealthy and more likely to donate.
Remember to think "ABC" when identifying donors: Able to make a gift, Belief (known or potential) in your cause, and Contact/Connection with your organization.
2. Get to know your donors. If your organization has dealt with donors in the past, you or a colleague will probably know what strategies work best in making your appeal. Some people want to know how the money from last year was spent, while others may simply want to know how much is needed. Certain donors may have fears or reservations about donating, and it's important to learn to recognize those fears/reservations so you can address them in advance.
Some donors may need to hear particular terms or phrases in order to be persuaded to donate. If you know this to be the case, make some indication of this on your list so that when you call or approach that person, you'll know what to say.
Any time a donor seems reluctant to give but gives anyway, make a note of that situation on your list or in that donor's file (if you have one). Listen to what the individual says when he or she is reluctant, and try to find ways to assuage those fears - not just for this year's fundraiser, but for future years as well.
Be aware that many well-known philanthropists hire other individuals to manage donations and contributions. Because of this, you may not get to speak to the actual donor himself/herself. However, the employees hired by a philanthropist probably have the same concerns that the philanthropist does, and you may have some luck appealing to the philanthropist's interests through his or her employees.
3. Find ways to present your organization. People who have donated to your organization will no doubt be familiar with who you are (as an organization) and what you do. But what about people who have never donated before? How will you describe what you do to an outsider? This is important, as it may determine whether the individual will listen to the rest of your pitch. If possible, try to compile some data on what your organization has done in the past, the problems you hope to address after this fundraising drive, and how that prospective donation would help your cause.
Try to present your organization in a way that both explains what you do while also highlighting the issue you seek to change. For example, you might say something like, "Did you know that [the issue your organization addresses] affects a significant portion of the city, and we are the only organization solely committed to addressing these issues in a comprehensive way?"
It's not a requirement to have data compiled, but for individuals who aren't familiar with your organization, it may be very helpful to know that information.
Consider printing out a brochure or having a reusable chart to illustrate both the improvements you've made and the improvements you hope to make.
Think about what you might say if someone doesn't understand your organization's goals, or what you might say if someone was dismissive of your organization. Try putting yourself in those shoes - imagining that you were someone who didn't want to help the organization - and what you might say to the organization. Then imagine how you might respond to hearing those words.
The better your donor base understands your organization - and the better you understand your donors - the more likely you'll be to build a long-term relationship with that donor.
4. Practice your appeal. One of the best things you can do to strengthen your appeal for donations is to practice what you're going to say. That doesn't just mean knowing how to actually ask for money, but also knowing how to initiate the conversation, practicing scenarios, anticipating potential responses, and knowing how to direct (or re-direct) the conversation.
Remember that the best appeal will educate the potential donor, rather than making a simple sales pitch.
Practice your appeal out loud. Get comfortable with the speech, and learn to adapt it to your own style of speaking. Make it your own speech, and try to make it feel comfortable and unrehearsed (even though this may take a lot of rehearsal).
Practice in front of a mirror if you will be interacting with donors face-to-face.
Try recording yourself, either with a tape recorder or on video, and study your mannerisms and your speech patterns. Does it sound honest? Do your vocal patterns and your physical mannerisms communicate the message of your organization, and the urgency of what you're trying to solve?

Part 2 Asking for Donations.
1. Start a conversation. Don't just call and start running in with your pitch. Work on creating a dialogue with the potential donor, which may mean making some polite small talk at the start. It can be as simple as asking the person how his or her day is going. Anything to start a conversation should help disarm the individual, and make the person realize that you're a caring and concerned member of the community.
If the prospective donor is a known philanthropist, he or she may prefer to have someone who heads the foundation ask for a donation. Statistically, donors are more likely to give money to a recognizable figure affiliated with an organization, rather than to a fundraiser who contacts them on the organization's behalf.
Initiate the conversation by getting the prospective donor to acknowledge an existing problem. If you're raising money for a local organization, you might open the conversation by asking what he or she thinks is the greatest crisis facing your region.
2. Make your intentions known. You shouldn't just introduce yourself by asking for money, but you should make your intentions known near the end of your small talk. Start by asking how the person is doing, or commenting on the weather, and then use that as a lead-in to say, "I'm working with _______, and we're trying to help _______ be able to ________."
If the individual feels like you're just having an aimless conversation and then suddenly he or she is asked for money, it may create tension and cause the person to feel like you're shaking them down. Be calm, friendly, and casual, but don't drag your feet about making it clear that you have a purpose.
3. Let the other person speak. Chances are, if you launch into your usual appeal to a person on the street who's never donated before, that person will walk away. But if you have created a dialogue, and made room for the other person to speak, you may be able to get that individual to feel engaged and a part of the solution.
Try asking a Question : . Say something like, "What do you think is the biggest problem our community faces?" Once the person has answered, instead of simply saying, "Yes, you're right. Will you consider donating?" try a more nuanced approach. After the person says what he or she sees as the problem, just say, "How interesting!" and keep silent while remaining interested.
People fear silence, and the person will probably fill that gap by elaborating on why that issue is important. That potential donor may go on to talk about how a family member has been affected by those issues. This gives you an in to take the specific concern he/she has and run with it. It's no longer an abstract concern, but a specific problem that may have affected the individual personally.
4. Make a specific request. If you leave a donation appeal open-ended, the person may not end up donating, or may only give a few dollars. But if you ask for a specific amount, it takes a lot of guess work out of the equation for that individual, and makes it easier to commit to your request. For example, if the person seems interested, say something like, "Well, we can make a difference. For just _____ dollars, you can help accomplish ___________."
Another way to ask for a specific amount is to put the ball in their court. Ask something like, "Would you consider a gift of _____?" or "Is ______ something you'd be willing to consider to help tackle the problem of __________?"
5. Be persistent. Many people will say no right off the bat, but others may simply need to be persuaded a bit more. Perhaps someone might say that the amount you requested is too high. If that happens, let the person know that any donation amount would be a big help, and ask if there's a slightly lower amount that the person would be willing/able to donate.
Don't be aggressive with your appeal, but do be insistent that your cause is worthy and that any donation amount would help that cause.
6. Thank the person either way. If the individual is willing to donate, then it's cause for celebration. You can thank the person and let him or her know that that donation will go a long way towards solving or addressing the issue at hand. But even if the person is not interested in donating, you should still be polite and appreciative of their time. Simply say, "Well, thank you for your time and have a wonderful day."
Expressing gratitude and courtesy can go a long way. Just because someone isn't interested in donating, that doesn't mean the situation won't change. Perhaps next year the people who said no will have heard or read more about your organization, or perhaps the individual will have been personally affected by the issue you're seeking to address. Making a good impression now, even when turned down, may be what helps you get a donation next year.
7. Follow up with donors. If someone gave a donation, you should absolutely express gratitude. Send the donor a thank-you letter and a gift receipt (in case they want to write it off on their taxes or simply have a record of the donation). It's best to send these items as quickly as possible so that the donor knows that the contribution was greatly appreciated and will be put to good use.

Community Q&A.

Question : How do I ask a rich person for 50,000 dollars?
Answer : Follow the instructions listed in the article above. However, they will likely say no.
Question : How can I get money if I need it urgently?
Answer : Get a job, start a blog, make something, or ask for a small loan.
Question : How can I get help with my power bills and the foreclosure on my house?
Answer : There are probably social services nearby that can help.
Question : How can I raise money for my wedding?
Answer : Ask friends and family members if they are willing to pitch in some money to help fund your marriage. In return, send them invitations.
Question : How can I find money for my daughter's marriage?
Answer : Loans, relatives, friends, or you could try planning a wedding that won't cost you much!
Question : Where can you apply for a small business loan with bad credit?
Answer : You can try becoming a member of a credit union and try for a loan there.
Question : How do I ask for money if I am about to be homeless with an autistic son?
Answer : Ask family and friends, and tell them your situation. Look for government programs that can help, and depending on the age of your son, you may be able to get financial help for him. You can also ask family and friends if the two of you can stay with them while you get back on your feet. That way, you have an address while you look for a job.
Question : I need a loan to deal with a parent's sickness, what can I do?
Answer : Loans are not the only solution to sickness, there are organizations that provide affordable medical care. Search for these in your area. You might also consider launching a donation campaign through Kickstarter or another fundraising website.
Question : How can someone fund me to help me spread the word of God?
Answer : Try doing a simple fundraiser, like a lemonade stand or a car wash.

Tips.

Many people are more motivated to help you with money if they sympathize with your goals or interests. Try to tailor your appeal to each individual donor, based on how that donor seems to respond to the issues you address.
Always send a thank-you note to your donors, regardless of how much they sent you.

July 02, 2020

How to Stop Being Broke

How to Stop Being Broke.

If you're sick of being broke, it's time to take control of your finances! Whether you need to work on your spending habits, learn how to save, or find ways to earn more money, you can find a way to stop being broke. Follow these steps to start working towards financial freedom and better peace of mind.

Part 1 Getting into the Right Mindset.
1. Set goals. If you want to change your financial situation, you need to get specific about want you want to accomplish. Think about exactly what you want your finances to look like and what you can do to achieve those goals.
Setting short-term goals in addition to long-term goals can help keep you motivated by providing you with a sense of accomplishment.
Create a budget for non-essential items and hold yourself accountable for it each month. If you go over-budget one month, tell yourself that your budget for the next month is reduced as a result.
2. Stop comparing yourself to others. If you're spending beyond your means because you feel that you need to keep up with your friends or show others that you can afford a certain lifestyle, you're not doing yourself any favors. Stop worrying about what others can afford and think about how you can live within your means.
Stop equating your self-worth with your ability to buy things. This kind of thinking will make you extremely unhappy in the long run and will probably get you stuck in debt forever.
3. Track your expenses. To understand exactly where all your money is going, keep careful track of every dollar you spend. You can do this with a pen and paper or electronically if you use a card for everything, but make sure to account for everything. This simple habit will help you spend more wisely.
Try categorizing your expenses and adding them up on a monthly basis. For example, you could create categories for food, housing, transportation, utilities, insurance, entertainment, and clothing. Then calculate what percentage of your income you are spending on each category. You might realize that your expenses in some of these categories are way too high.
To understand how much you can afford to spend each day, subtract your fixed expenses from your monthly income and divide the remaining amount by 31.
4. Make a plan for getting out of debt. If you are broke because you have credit card debt, a car payment, or student loans, think about what you can do to pay off these debts faster.
Making even a few extra payments each year can help you pay off your debts much faster.
5. Start saving. This may seem impossible if you are always broke, but planning for the future will help you get out of this cycle. Start small by just putting $50 in an emergency fund each month.
Don't forget to save for retirement! Take advantage of the 401k offerings at your company or open an IRA account.

Part 2 Avoiding Money Traps.
1. Avoid lending to others. While you may want to help out your loved ones who are in need, you really shouldn't be lending money if you can't afford to pay your own bills.
2. Avoid payday loans. While they may seem like a good solution if you're strapped for cash, the interest rates are ridiculously high, so they will only get you further into debt.
3. Understand how much it will really cost. Before you take out any kind of loan or finance any purchase, be sure to calculate what your monthly payments will be, how long it will take you to repay the debt, and how much you will be paying in interest.
In some cases, paying interest may be worth it. For example, most people cannot afford to purchase a house without taking out a mortgage, but depending on the price of the house and the average cost of rent in your area, you might still be saving a significant amount of money by choosing to buy with a mortgage instead of renting.
Be especially wary of high interest rates for depreciating assets like vehicles. If you decide to sell your vehicle after you have owned it for several years, it may be worth less than what you owe on it. This can also happen with real estate when the market conditions are poor.
4. Avoid impulse buys. If you always have a plan for what you will buy, you will have a much easier time managing your finances.
If you have a hard time controlling your purchases when you go to the mall, try to avoid going to the mall at all.
Write out a list when you go shopping so you will always know exactly what you need to buy.
5. Use credit cards wisely. If you have a harder time keeping track of your expenses and sticking to your budget when you use a credit card, stop using it.
Paying with cash instead of a credit card will allow you to visualize how much of your available funds you are spending on a given purchase.
If you are able to stick to your budget when using a credit card, look for one that has no annual fee and will reward you with cash back or other incentives. Just make sure you always pay your bill on time or these incentives will not be worth the price you are paying in interest.

Part 3 Spending Less.
1. Assess your daily or weekly spending habits. Once you have a solid grasp on what you are spending your money on, you can start cutting out expensive habits.
2. Buy used items. You can save on everything from your next car to furnishings for your home by buying gently used items.
You can sometimes find really great clothes that have barely been worn at thrift shops for a fraction of the price.
3. Look for monthly expenses that can be cut. If you pay for monthly memberships or subscriptions, carefully assess how much they cost, how much you use them, and whether you could give them up.
Make sure you're not paying for services that you never use. For example, if you have premium cable channels that you never watch, you can cancel them without feeling like you are making any sacrifices. The same goes for your cell phone bill if you are paying for more data than you ever use.
4. Compare items or brands when shopping. If you're on a tight budget, you want to make sure you're always getting the best deal on absolutely everything. Take some time to compare prices for items you purchase regularly and for large purchases.
If you've had the same auto insurance carrier or cable company for a long time, there might be better deals out there, so be sure to comparison shop regularly.
Shopping for necessities online can be cheaper in some instances, but make sure you take shipping charges into account.
Use coupons to save some extra cash. Keep in mind that many retailers accept competitors' coupons.
5. Ask for a better deal. You can always ask your service providers for better deals, especially if you've been a loyal customer. The worst they can say is no.
Try this with your cable and internet providers, insurance companies, and cell phone carriers.
6. Spend less on entertainment or at restaurants. Whether it's dining out or going to amusement parks, entertainment can eat up a big chunk of your budget. Look for less expensive ways to have fun.
Learn to cook at home and keep the fridge well stocked with ingredients for things that you know you can cook from scratch when you come home late and don't have much time to whip up a grand meal.
Instead of going out to eat with friends, invite them over for a potluck.
7. Do more yourself. It may be convenient to use a laundry service or to have someone else shovel your driveway, but if you're physically capable of doing these things yourself. Think about the money you can save.
If you're not very handy, try to teach yourself to do more around the house. If you need a simple repair done, you may be able to watch a video online or take a class at a local home improvement store to learn how to do it yourself.
8. Save money on energy. Go green around the house to save money on your utility bills each month.
Sealing up air gaps can reduce your heating and cooling bills. If you own your home, investing in a properly insulated attic can make a huge difference.
Turning your heat down just a few degrees in the winter can make a big difference in your energy bills as well. A programmable thermostat will let you automate the temperature of your house so you won't spend money on heating the place to a comfortable level when you're not at home.
9. Avoid bank and credit card fees. Choose your bank and credit card providers wisely in order to avoid unnecessary fees.
Make sure to only use the ATM at your bank if you will get charged for using outside ATMs.
10. Aim to have a few no-spend days a month. After a while, it becomes a game: "How can I run my life today without writing anything down in my little blue book?" "How ingenious can I be to make do with the things, food, and resources I already have at my disposal?" See how often you can turn this into a habit.

Part 4 Earning More.
1. Get a better job. If spending less is just not enough, it may be time to get a better job that will allow you to make more money. Start by updating your resume, searching for listings online, and networking with other professionals in your field.
Don't forget to look for advancement opportunities within your company.
2. Do something else on the side. Using your skills to provide freelance or consulting services is a great way to earn additional income. If this won't work with your profession, get a part-time job or find creative ways to make some extra cash on the side.
You can make some extra money by performing jobs like mowing lawns, cleaning houses, or even walking dogs for people in your neighborhood.
3. Sell stuff you don't need. You probably have at least a few possessions that you no longer need or want, and you can turn those items into extra cash by selling them to people who do want them.
If you have lots of unwanted items, try having a yard sale.

Community Q&A.

Question : My family barely has any money. My dad has his own company, but it hasn't gotten any business in a long time. I have some money saved up, and I was think of leaving a little in my dad's wallet. What do you think?
Answer : Definitely do. Work as much as you can and give and much as you can. Also putting your family's money in a good, interest-bearing account can help a lot.

Tips.

To always have money in the bank to pay regular bills, add them up for the past year and divide by 52. Round up to the next 25, 50, or 100 dollars. Remember to add in quarterly or annual bills, too.
Buy clothes that can be used for several different occasions instead of only one-time events.
Use coupons on items whenever you can.
Start a Christmas Club account, but put in more than you expect to spend on gifts. The excess is great for a mini-vacation or special purchase.
Get a jar to collect your spare change. When it's full, take it to the bank. (Don't take it to one of those coin counters, as they charge for counting your change.)
Take it a day at a time. Start small, set goals, reward yourself (not with any type of shopping, of course) and enjoy playing the game.

July 02, 2020

How to Deal With Losing Your Wallet

How to Deal With Losing Your Wallet.

Losing your wallet can be frustrating, embarrassing, and, if it falls into the wrong hands, a threat to your finances and your good name. If you cannot quickly locate your lost wallet using sensible search strategies, acting promptly to secure your identity and credit can save you a good deal of aggravation down the road. Consult this article to help take back control of what you’ve lost.

Part 1 Handling a Lost Wallet.
1. Search for 24 hours before canceling credit cards or requesting a new ID. You have 48 hours to report a missing card before you are liable for any charges, so use the time wisely. If you know the card is stolen, move on to the next step immediately.
Search all clothing, bags, and pockets.
Call recent locations, like restaurants and bars.
Search your house systematically, circling from the perimeter of rooms to the middle.
2. Go online and check for any fraudulent charges. Check your bank and credit card accounts online to see if any purchases have been made since the card went missing. If there are charges, this likely indicates the card was stolen.
3. Inform your bank of the missing card. Call your bank and let them know the card is gone. Report any fraudulent charges immediately. Log the date and time of every interaction in case there is a dispute.
4. Cancel any credit or debit cards. Call the institutions involved and request a new card. If you have any alternate copies, cut them up and discard them. You may need to provide bank information to verify your card is missing.
5. Call the major credit bureaus and to request a fraud alert on your credit line. This helps prevent serious changes to your credit score.
6. Apply for a replacement ID. Call, visit, or go online to check your state DMV's policy on new licenses. Many let you get your first replacement online, though it does cost money.
7. Call your insurance company and request a new account number. You should do this for medical, dental, and auto insurance to avoid potential identity theft.
8. Report potentially stolen property to the police. They will let you know if something comes up. Having a police report will also make it much easier to deal with disputes from your bank or credit cards if something goes wrong or your identity is stolen.
You should file a police report online no matter what, providing a paper trail for your bank in a dispute.
9. Photocopy all of your cards and IDs for future reference. It is much, much easier to remedy a lost wallet if you have copies of all the documents and cards. Never carry your Social Security card in your wallet, even a copy.

Part 2 Searching for Your Wallet.
1. Relax, focus, and think. Have you ever gotten angry because you can't find the remote or the Corn Flakes, then gotten even angrier because nobody in your house can put things back where they belong, then eventually calmed down and realized the remote or Corn Flakes are in fact exactly where they belong and you just missed seeing them?
When we panic about losing something, especially something important like a wallet, we lose focus and can easily overlook obvious clues -- or even the item right in front of us.
Take several deep breaths, and try to clear your mind. Try not to think about all the problems you'll have to face if you can't find your wallet. Focus only on the wallet, where it should be, and where it could be. Then begin your true search.
2. Look again in places it would normally be. Your first search was probably increasingly panic-stricken and thus increasingly useless. Now that you are calm, pick out the most obvious spots where your wallet would be -- the pocket of your pants hanging on the chair, your nightstand, your desk at work -- and give a proper search.
Search in proximity to the obvious places as well -- the floor around your nightstand, your other desk drawers / pants pockets, etc.
3. Retrace your steps. Think about the last place you remember having your wallet -- paying for coffee downtown, picking it up from your nightstand, etc. -- and work backwards until reaching that point.
Go through all the clothes you’ve worn in that period of time, and check all the pockets carefully. Be sure to include coats and bags as well.
Working your way back through your routine may help jog your memory, so leave no stone unturned even if it seems an unlikely place to have lost your wallet.
Consider whether someone may have (without bad intent) picked up your wallet -- a curious child? a friend trying to help? Contact anyone who may have had inadvertent contact with your wallet.
4. Call places you visited recently. Did you visit a restaurant, theater, an office, or even a friend’s house? Call and ask if your wallet has turned up.
You may need to describe your wallet. Knowing the name on your ID and credit cards will probably suffice to prove it’s yours, but being able to describe a family photo or ice cream punch card might help as well.
Don’t assume a business will call you if they find your wallet. They might place it in lost and found and forget, or they may have a policy not to call for privacy reasons -- they may not want to disclose where you were without your permission by calling your home.
5. Look carefully in places it would not normally be. Expand your search radius further away from the most likely places your wallet would be -- your whole bedroom, your whole second floor, your whole house.
Pick out high-traffic areas in your home/workplace where you wouldn't usually place your wallet but could have -- the kitchen, the restroom, etc.
Search a room methodically by using a grid search (breaking the room up into small segments and searching each one-by-one), or a spiral search (searching around the perimeter, then working inward to the center).
For more search ideas, see How to Find Lost Objects
6. Assume your wallet is stolen if not found within a day or so. No, don’t call before making a good effort searching for the wallet, because it would be very frustrating to go through the process of canceling cards, etc., only to find it in your jeans pocket. That said, it is better to be safe than sorry if you can’t track down your wallet relatively quickly.
Your liability for purchases made with a stolen debit card begins after 48 hours (at $50), and other lost cards may have deadlines for reporting as well. And even if you are not liable for credit card purchases, it is much easier to stop fraudulent charges before they can happen than deal with them after they do.
Begin making the notifications indicated in the relevant Part of this article.

Part 3 Protecting Your Identity and Finances.
1. Call your bank(s) and report your debit card(s) as missing. Because laws governing debit cards and credit cards are different, you should make this call first and within 48 hours of losing your wallet to protect yourself from fraudulent charges.
If you alert your financial institution within 48 hours, you maximum liability is $50; within 60 days, it is $500; after that, your liability is unlimited if someone is using your card.
Because your debit card is linked to your checking account, and your checking accounts may be linked to other accounts, expect to receive not only a new debit card / number but also new account numbers. You will also need new paper checks.
Keep in mind any automatic payments you may have through your debit card or checking account (phone bill, life insurance premium, etc.). You will need to update the payment information on these when your account number changes.
Yes, this is a hassle, but it is better than having your bank accounts drained and then having to jump through hoops to have your funds restored.
2. Report your credit cards as missing. You don’t actually need to cancel them, which would necessitate applying for cards all over again. By reporting them as missing / stolen, you will get new cards with new numbers but be able to retain your current account status.
You maximum liability for fraudulent credit card charges is $50, and is $0 if you contact the company before the card is used fraudulently, but it is easier to prevent fraudulent purchases before they happen than work to erase them afterward.
Program the customer service numbers for your credit card companies (as well as your banks) in your phone so you can contact them quickly.
Don’t forget store-issued credit cards as well.
3. File a police report for a lost or stolen wallet. No, finding your lost wallet isn’t likely to be their first priority, but making a police report is an important way to protect yourself regardless.
Filing a report creates an official documentary record of the loss and your recovery efforts. This can prove quite valuable for any insurance claims, fraud liability resolution, identity theft problems, or other issues that might arise.
Provide as accurate and detailed an account as possible, with specific time frames and locations. Keep a copy of the report for your records.
4. Call the major credit bureaus to protect your credit rating. In the U.S., contacting one of the three major agencies -- Transunion, Equifax, and Experian -- should suffice, since they are required to share this information, but it can’t hurt to notify all three directly.
A fraud alert will be placed on your accounts, meaning that any attempt to extend further credit will require identity verification.
Anything you can do to avoid the mess of cleaning up damage to your credit score caused by fraud is well worth your time and effort.
There are pay options for fraud monitoring services, sometimes offered through your credit cards, that can alert you immediately of possible fraudulent activity.
5. Replace your lost identity cards. No one looks forward to visiting the Bureau of Motor Vehicles, but you shouldn’t expect the police to buy your story of a lost wallet (and driver’s license) if you are pulled over.
Each U.S. state has its own policies and procedures regarding replacing lost or stolen driver’s licenses, but expect to have to visit in person and pay a replacement fee.
Other ID cards -- school, work, etc. -- will need to be replaced as well.
6. Make a list of everything that was in your wallet. Try to remember as much as you can, and see if you can come up with anything else that needs to be reported or replaced.
Don’t forget about store discount cards or even a library card. These may seem like small potatoes compared to debit and credit cards, but they may permit access to personal information that you don't want in someone else's hands.
Basically, you want to start over from scratch in order to make the contents of your lost wallet as worthless as possible, both financially and in regards to your identity.

Community Q&A.

Question : I have lost my wallet and I am 12, I have looked everywhere. What do I do?
Answer : Don't panic. Keep looking and retrace your steps. If you went anywhere, check to see if your wallet was turned in by someone. If you still can't find it, tell a parent, they will help you replace whatever you had in your wallet (if possible).
Question : How would I find my child's wallet?
Answer : If a child has lost their wallet, retrace their steps until you find it. More likely than not, the child has simply misplaced it. If you still can't find it, you may want to report it missing to the police. Also, if the child had any credit cards inside the wallet, freeze them online immediately.
Question : How do you handle it appropriately if you lost your wallet at school?
Answer : Don't panic. Your first reaction might be that someone stole your wallet, but you should check everywhere before jumping to that conclusion. Check everywhere you might have left it. Pockets, backpack, classrooms, and your locker are all places where you might have left it. Dig deep in that bag! Retrace your steps. When was the last period you remember having your wallet? Go to the room where you remember having it. If it is not there, contact the teacher you had during that period and ask them if they or any students took it to give to you. Go to the lost and found. Ask the Public Safety or Main Office if anyone has brought in a wallet. They will take it from there.
Question : I lost my purse, but I believe it was stolen. Is there a possibility of finding it?
Answer : The chances of finding it are very low. Someone probably has seen it and taken it. Still, try checking if it's been handed in.
Question : What should I do if a customer's wallet was found, but returned with missing cash?
Answer : You are not responsible for missing cash.
Question : My wallet was stolen; it had all my identification in it including my social security card. What do I need to do to get the DMV to issue me another ID?
Answer : You'll have to check with your local DMV for exact instructions, but usually they need two forms of ID, most commonly social security card, birth certificate, and/or passport. If you don't have a passport, you may have to use your birth certificate to get a replacement social security card before you can replace your license/ID, but like I said, check with the DMV.
Question : If my wallet is stolen in Europe, should I report it when I get back home?
Answer : No, report it to the local authorities. The police in your home country will likely not be able to help.
Question : I lost my wallet in school today. How can I figure out if my friend stole it?
Answer : If you really think someone stole it, tell a teacher, principal, guidance counselor, etc. They might be able to review security footage, and/or talk to the person or people you suspect to find out the truth.
Question : How do I get someone to give me back my wallet if they stole it?
Answer : If you know the person, ask them to give it back. If they don't, that is stealing. If you don't know them, file a police report and freeze all your credit cards immediately.

Tips.

Don't keep all your cash in your wallet. Get a money clip to hold some of it in, or keep some at home in a safe place and only carry what you think you may need. This way, you reduce the amount of cash you may lose if you lose your wallet.
Periodically during the day, make sure you still have your wallet. It takes only a second to do, and it gives you a better chance of finding your wallet if you have just lost it. Get in the habit of checking regularly: every time you get up to go, while you're walking, etc. A light touch of your back pocket or a quick look in your purse will give you a clear indication.
If you keep your wallet in your back pocket, make sure the pocket is not stretched out. Your wallet will most likely stay in your pocket if the wallet is not too thick and your pocket is tight.
Keep your cards separately in a card holder. When you lose a wallet you can still use your cards, and when you lose cards/cardholder, you will still have cash.
If you regularly keep your wallet in your back pocket, try to wear pants that have a button on the back pocket, and use it.
Do not keep your wallet in your back pocket when you travel, or are in crowded places, unless it is secured with a chain. This extra level of security nearly eliminates the chance of someone taking it from you. Or, for even more security, use a money belt.
Write your phone number and small message on a piece of paper or card and put it in a visible compartment of the wallet. Make it easier for an honest person to return the wallet to you.
Make sure you write down important account numbers before you lose your wallet, or check your paper or electronic bills for the account numbers and contact information. In the case that you do lose your wallet, these numbers will be critical to know.
Good places to check for your wallet include recently worn clothing (pants pockets, etc.) and your clothes dryer.

Warnings.
Never store pin numbers, passwords or your Social Security number in your wallet.

June 25, 2020

How to Keep Track of Your Personal Finances

How to Keep Track of Your Personal Finances.

Staying on top of your personal finances can be challenging, tedious, and even discouraging, but for most people this process is a necessary evil. Spending more than you earn is a sure way to bury yourself in debt, and not being careful about precisely where your money is going can leave you struggling to pay for necessities like groceries. Fortunately, learning how to keep track of your personal finances is not difficult, but it does require a fair amount of time and discipline. Following either of the methods below will help you down the path of becoming better with your money.

Method 1 Keeping Track of Your Finances Manually.
1. Create a system. The most important part of keeping track of your finances is consistency. Regardless of which way you choose to log your transactions, you have to be able to refer back to them easily and reliably. Be sure to include important information like the date, amount spent or gained, and expense category with each entry. Also be sure to make your recording consistent. For example, you can record transactions as soon as they happen, every time you get home, or even once a week.
Expense categories are an easy way to figure out what you spend the most money on. These categories may include things like housing, utilities, household expenses, groceries, health care, pets, personal expenses, and entertainment. These categories will of course vary from person to person and you can be as specific or general as you want with your categories. For example, you may simply want to record expenses as either need or wants. The important thing is that your categorizing is consistent between transactions.
2. Keep a notebook. The absolute simplest way of tracking your finances is to write a record of each transaction in a notebook. By always carrying this notebook, you are able to know exactly where every dollar came from and went. At the end of each period (week or month), you can also transfer the information to a computer spreadsheet so that it is more accessible.
You can organize this notebook in several different ways. For simplicity, you may simply choose to use the notebook for spending. Alternately, you can treat it more like a logbook and record both your income and your expenses and how they affect the balance of your checking account. Some people choose to use a notebook to track cash expenses only, combining it with debit and credit card expenses at the end of each month or week.
3. Keep a checkbook. It may be considered old-fashioned, but recording your transactions in a checkbook is still a simple and reliable way of tracking your finances. The recording process involves simply writing down the amount of the transaction, writing a description of the transaction (a good place to write down the category), and then adding or subtracting the amount from account balance. For more information, and a look at balance a checkbook, see how to balance a checkbook
4. Use a computer spreadsheet. By using a simple spreadsheet on a program like Microsoft Excel, you can organize your expenses clearly and even create graphs easily to better understand your spending. They are many specific ways to do this, but a good start might be to create a personal budget. This would be done on a week or monthly basis, and include information like the amount, category, and date for each transaction.
To create a personal budget, start by listing your fixed expenses each month (like rent and utilities) as an expense on the first day of each month, along with your expected income for that month. You can then subtract other expenses or add other incomes as necessary throughout the week or month.
5. Analyze your finances at the end of each month. Regardless of which method you choose to keep track of each transaction, you will need also need some way of combining and analyzing your spending at the end of each month. This will allow you to see where your money is going and allow you to make adjustments for next month if needed.
Start by totaling your expenses and compare the sum to your income for the month. Obviously, if you're spending more than you're making, you'll have to identify the source of your overspending and try to make a change for next month.
To identify where your money is going, you can try totaling your spending by category. That is, you should combine the totals spent in each expense category and compare them either to each other or to your total expenditures. Specifically, you can divide the total of each category by the sum total of all of your expenses for the month to get the percentage of total expenses accounted for by that category. This will allows to you identify areas where you might be overspending.
You can also use this information to create a working budget for next month.

Method 2 Using a Personal Finance Application.
1. Select a personal finance app. There are a multitude of personal-finance apps available both for mobile phones and web browsers that offer services to track, tabulate, and analyze your expenses. These apps also offer a range of comprehensiveness, from simply acting as a budget-creation tool to displaying all your assets in one place. In choosing one, keep in mind your financial goals and ability to commit to using the app.
You may want to choose a comprehensive app that pulls in all of your financial information from bank accounts, retirement accounts, and other sources. These often also track your bills and remind you to pay them. Award-winning examples include:
Mint, Personal Capital, Pocket Expense.
Alternately, you may want a simpler app that just keep track of your expenses and/or your income. These apps also connect to bank, but offer a simpler interface and fewer options than the more comprehensive apps. Good examples include:
Level Money, BillGuard.
Finally, if you want to use an app to track your finances, but don't feel comfortable handing over your financial information (bank passwords and account numbers), there are also apps that function as manual-input ledgers and analysis tools. Good examples include:
Mvelopes, You Need a Budget.
2. Input your information into the app. If the app you have chosen requires bank information, input your information and wait for the app to sync with your accounts. Alternately, input your own transaction information as you spend money and watch the app work its magic. The apps will guide you during this process.
3. Study the app's analysis. At regular intervals, the apps will supply you with analyses of your spending habits. Be sure to actually read these reports and think about adjusting your spending habits if necessary. Some apps will provide guidance on how to save money in certain areas.

Tips.

This article is mainly about keeping track of your expenses and income. For more information about managing your finances and saving money, see how to save money and how to manage your finances.
Try to minimize your use of cash, as it tends to be more difficult to track than debit or credit card expenses.

June 04, 2020

How to Prepare for Economic Collapse

How to Prepare for Economic Collapse.

An economic collapse means a breakdown of the national economy. It would be characterized by a long-term downturn in economic activity, increased poverty and a disruption of the social order, including protests, riots and possibly violence. In some cases, this collapse would be akin to a deep recession, with society still functioning basically as normal (just with more poverty). However, it could be much worse. You should prepare for the worst, but adjust your actions to the actual severity of the collapse. You can prepare for an economic collapse by preparing financially, stocking up on the essentials, and monitoring the economic indicators.

Method 1 Preparing Your Finances.
1. Start an emergency fund. If you are living paycheck to paycheck and you lose your job during an economic collapse, you are at risk for losing your home and living in poverty. It won’t be easy to find another job and replace your income. Your goal should be to save up enough to cover six months of expenses in your emergency fund.
If you are trying to get out of debt, save up an emergency fund of $1,000 and then apply all of your extra income to your debt. Once your debt is paid off, you can divert more money into your emergency fund.
Keep your emergency fund separate from your checking account so that you are not tempted to use the money. Put it in a low-risk, interest-bearing account such as a savings account, money market account or certificate of deposit (CD).
On the other hand, a complete economic collapse would leave you unable to access your bank account, because of the crash of the financial system. Additionally, your money may become useless or extremely devalued. Consider stocking other commodities that you could barter with in an economic collapse, like alcohol, precious metals (gold and silver), and fuel.
2. Have cash on hand. Depending on where you have it, money in your emergency fund might be hard to liquidate. Bonds, for example, must be sold, and other investments like CD’s might charge fees for early withdrawal. Also, if you have a savings account with an online bank instead of a brick-and-mortar institution, it might take several days to withdraw your money. It’s important to have cash that you can access easily, either from a savings account or a cash box in your home. This can tide you over in an emergency until you can access money in your emergency fund.
3. Generate an additional source of income. Start a home business as a second source of income. If you lose your job because of an economic collapse, it might be difficult or even impossible to find another job. Having an alternative source of income can help you to keep your home and avoid poverty. Choose your business idea based on skills that you have and things that you enjoy doing. In addition, think about how likely it will be that people will require these services in an economic collapse; people may need basic necessities like clean water or food more than they need an interior decorator.
Provide services to people in their homes, such as house cleaning, home organization, meal preparation, or interior decorating.
Sell goods you produce, such as baked goods, custom clothing or jewelry.
4. Get out of debt. In a financial collapse, many people are going to lose their jobs and their homes. To prepare for this possibility, you should make a plan to get out of debt as quickly as possible. This way, if you do lose your job, you don’t have to worry about finding a way to pay these bills. The worst kind of debt to have is credit card debt. Because of the high interest rates that many people have, carrying a balance on a credit card can cost you a great deal of money.
Create a budget in order to track your income and expenses. Make a plan to have a surplus of money left over at the end of the month to apply towards your debt. This means reducing your expenses and possibly finding additional work to supplement your income.
Organize your debt so you can make a plan to pay it off. You can choose from a few different methods for planning how to pay off your debt. Whichever method you choose, it is important to stick with it.
One method is to order your debts from smallest to biggest, regardless of the interest rate, and pay off the smallest debts first. This helps you build momentum.
Another method is laddering, which means paying off the debt with the highest interest rates first. This makes the most sense mathematically because it reduces the amount of interest expense you pay in the long-term.
That said, in a true economic collapse, your creditors would likely have other things to worry about than just finding you and recovering your debts. Additionally, currency may be greatly devalued or completely useless, meaning that the amount stated on your debt balance would be equally depressed or meaningless.

Method 2 Storing the Essentials.
1. Store emergency water. In the event of an economic collapse, it is possible that your power and water supply might be interrupted, or that you will not be able to pay for these things. You will need a supply of clean water for drinking, cooking and hygiene. You can purchase bottles of water or store water in your own containers. If you run out of water, you can take steps to sanitize contaminated water.
Store at least one gallon of water per person for a minimum of three days or for up to two weeks. Don’t forget to include pets in this equation.
If you are storing water in your own containers, wash them first with dish soap and water and sanitize them with a solution of 1 teaspoon of liquid chlorine bleach to a quart of water.
To make water safe, you can boil it and filter it through a clean cloth, paper towel or coffee filter.
2. Stockpile food. The kind of food you store up for an emergency is different from the groceries you purchase each week. You need to get food that is non-perishable, does not have to be refrigerated and will provide you with the nutrition you need to survive. It may be very different from the food you are used to eating, but you will be glad you have it if you ever need it.
Purchase food that does not have to be refrigerated or frozen so you don’t have to worry about power outages. These foods include canned goods, peanut butter and beef or turkey jerky.
Include foods highly nutritious foods that are easy to store, such as dried foods, nuts, beans, canned meat and vegetables and powdered milk.
For comfort foods, avoid snack foods that will quickly expire. Instead, stock up on spaghetti and spaghetti sauce, soups, sugar and honey for canning and baking, dried fruit, coffee and tea and hard candy.
If necessary, stock pile baby food and formula, Don’t forget to include pet food if you have pets.
Keep a manual can opener with your stockpile.
3. Start a garden. A garden allows you to continually have fresh, nutritious food to supplement your emergency food supply. Also, in an economic crisis the cost of living might skyrocket. Having a garden will help you to save money on your grocery bills. It will also allow you to be self-sufficient should a food shortage result from the financial collapse.
If you don’t have a lot of space, consider starting a container garden.
If you don’t have good soil, purchase humus soil or top soil. Add peat moss, composted manure and plant fertilizers.
Choose vegetables and herbs that are easy to grow, including beans and peas, carrots, greens like lettuce, cabbage, spinach and kale, potatoes and sweet potatoes, squash, tomatoes, broccoli, berries and melons.
4. Create an emergency kit. This is a collection of household items you might need in an emergency. In the event of an economic collapse, you may not be able to shop for these supplies, so it’s important to have them on hand. Keep your supplies in a container that’s easy to carry in case you have to evacuate for some reason.
Include an extra set of car keys, blankets, matches, a multi-use tool, maps of the area, a flashlight, a battery-powered or hand-cranked radio, extra batteries, matches and a cell phone and chargers.
Have some household liquid bleach on hand for disinfecting.
Make copies of all important documents, such as proof of address, deed/lease to home, passports, birth certificates and insurance policies.
Have a list of family and emergency contact numbers, Include baby supplies such as baby food, formula, diapers and bottles.
Remember pet supplies like food, collars, leashes and food bowls.
5. Gather first aid and medical supplies. You can purchase a first aid kit or put one together yourself. Either way, make sure it has all of the necessary supplies. Include personal items such as medications for yourself and members of your family. Check the kit regularly to make sure nobody has used any of the supplies. Also, check the expiration dates and replace expired items.
Keep a first aid manual with your first aid kit.
Include dressings and bandages, such as adhesive bandages in various sizes, sterile gauze pads and a gauze roll, adhesive tape, elastic bandages and sterile cotton balls.
Add equipment and other supplies, like latex or non-latex gloves, instant cold packs, a thermometer, safety pins to fasten splints or bandages, tweezers, scissors and hand sanitizer.
Have medicines for cuts and injuries, such as antiseptic solution like hydrogen peroxide, antibiotic ointment, calamine lotion for stings or poison ivy, hydrocortisone cream for itching and an eyewash solution.
Include contact lens solution if necessary.
Other medicines to have include pain and fever medicines like aspirin, acetaminophen or ibuprofen, antihistamines for allergies, decongestants for colds, anti-nausea medicine, anti-diarrhea medicine, antacids and laxatives.

Method 3 Preserving Food.
1. Preserve meat and fish. In an economic collapse, food stores could become dangerously low. If you are going to stock up on meat and fish ahead of time, you will need to know how to cure it. This will allow it stay fresh and edible much longer. Also, it can be stored at room temperature. This will be helpful in the event of a power outage.
2. Salt cure meat. Salt curing means using salt to kill the microbes that would spoil it. For every 100 pounds of meat, you need 8 pounds of salt, 2 ounces of saltpeter and 3 pounds of sugar. Apply the cure mixture directly to the meat. For bacon, allow the meat to cure for 7 days per inch of thickness. For ham, leave the mixture on for a day and a half per pound. After curing, rub off the salt under running water and allow it to dry.
If the outdoor temperature is expected to rise above 40 degrees Fahrenheit, you will need to allow the meat to cure in a meat locker.
If the outdoor temperature is below freezing, allow an extra day for curing.
3. Smoke cure meat. Wood smoking meat not only adds flavor, but it also protects your meat from pests and spoilage. Cold smoking smokes the meat without cooking it. Hang the meat in a smoke house, light the fire and allow the meat to smoke for 10 to 20 hours. You can purchase a ready-made smoke house or plans to build your own.
Use aromatic woods to add flavor, such as hickory, mesquite, apple, cherry, pear or cranberry-apple.
Woods to avoid include all conifers, crape myrtle, hackberry, sycamore and holly.
4. Jerky meat. To make meat jerky, you can use a store-bought dehydrator. However, if you do not have one of those, you can do it in your oven by cooking it at a low temperature for several hours. Choose an inexpensive cut of meat, such as brisket. Trim the fat and slice thin strips against the grain. Season the meat with salt and pepper, and if desired, marinate it overnight with diluted barbecue sauce. Arrange the slices on a cooking grate, and put them in the oven at 170 degrees Fahrenheit for two to six hours.
Line your oven with foil for easy cleanup, Prop the oven door open with a wooden spoon to allow air to circulate.
Partially freeze meat before slicing to make it easier to slice.
5. Can fruits and vegetables. Canning involves heating food in a glass jar to remove the air and prevent spoilage. Choose from two methods to can food: water bath and pressure canning. The method you choose depends on the kind of food you want to can. Water bath canning is for jams, jellies and for acidic foods such as tomatoes, berries or cucumbers in vinegar. For main meal foods such as meat, beans and other vegetables, use pressure canning. To ensure safety, always use tried and true recipes.
6. Can with the water bath method. Gather a deep pot with a lid, a rack that fits into the pot, glass preserving jars, lids and bands and a jar lifter. Check the jars and lids for nicks and scratches which would prevent proper canning and allow spoilage to occur. Heat the jars in a pot of boiling water or in the dishwasher. Prepare your recipe and fill the hot jars with the food. Place the lids on the jars and immerse them in boiling water. Make sure the water covers the jars by 1 to 2 inches. Leave them in the water for the amount of time stated in the recipe. Remove the jars with a jar lifter and allow them to sit for 12 to 24 hours.
The lids should not flex up and down when pressed. If they do flex or if you can easily remove the lid, then the jar did not seal properly.
7. Can with pressure canning. You will need a store-bought pressure canner. As with water bath canning, check the jars for nicks and scratches, and heat them in boiling water or the dishwasher. Prepare the food according to your recipe and fill hot jars with the food. Place the jars in the canner and lock it in place. Vent the steam according to the manufacturer’s directions. Process the jars at the recommended pounds pressure stated in your recipe. Adjust for altitude. When done, remove the jars, allow them to sit for 12 to 24 hours and check the seals.

Method 4 Securing Your Home.
1. Choose your shelter type. A standalone shelter is a separate building that is designed to withstand natural disasters or man-made weapons or attacks. An internal shelter is a room within your home that has been designed to protect you from the elements or other hazards. In an economic collapse, power systems may fail and looters and scavengers may threaten your home. Take precautions to protect yourself.
2. Create two sources of electricity. One source could be solar. Hook it up to your home and then run the system discretely underground. The second source might be an underground generator. You will use this in the event of a total loss of power. Keep your energy sources hidden underground to protect them.
3. Choose the size of your shelter. The size of your shelter depends on how many people you need to protect and the size of your food stockpile. An adult needs 10 cups of water and 1,200 calories per day. In addition, each adult needs 10 cubic feet of natural atmosphere to have enough air to breathe, so you will need an air system that lets in and filters fresh air. If you are planning to stay in the shelter long-term, invest now in making it large and comfortable enough for everyone. If it is only going to be a short-term living space, you don’t have to make it as comfortable.
4. Keep the location of your shelter secret. Protect yourself from others who were not prepared and may want to take what you have. Don’t let your neighbors see you creating a shelter. You can choose a remote location, but it may be difficult to access it later. If you choose to make a safe room in your home, create a secret entrance from within your house. This way others will not be alerted to your shelter.
5. Purchase self-defense tools. Self-defense tools are generally non-lethal. They are used to fend off an attack by rendering the attacker ineffective. You can use everyday objects, such as baseball bats or keys. But these may not be as effective as tools designed for your protection.
Mace and pepper spray can be sprayed into an attacker’s face to give you time to get away.
Hand-held stun guns deliver a large electrical shock to stun the attacker.
Taser devices shoot two small probes a distance of up to 15 feet that transmit an electrical charge to the attacker.
Sonic alarms create a loud noise to let others know that you are in trouble.
6. Set up an alarm system in your home. Wireless security systems are easy and inexpensive to install and maintain. Home alert alarm systems notify you if an intruder is approaching your home. Hidden cameras allow you to see internal and exterior areas in your home where an intruder may be present. Phone dialing alarms can be installed inside or outside your home and allow you to contact authorities with the push of a button. Child monitoring alarms notify you if your child goes beyond a certain perimeter of your home.
7. Purchase weapons. Weapons can be used for either self-defense or for hunting. A crossbow is easy to shoot and aim. It’s also quiet, so it doesn’t alert people or animals to your presence. A long-range rifle allows you to hunt game from a distance. A machete can clear brush or fend off a dangerous animal. A slingshot is good for hunting small animals. Have pistols on hand and teach others to shoot, reload, shoot from cover and work as a team for protection. If you plan to have lethal weapons, be sure to train everyone who has access to them in the proper use of these weapons.
Stockpile appropriate ammunition and arrows for your weapons.
8. Gather necessary tools. Having the right tools on hand can make the difference between surviving and not surviving during any kind of disaster. You not only want to be able to protect your home, but you also need to be able to build anything you might need.
Have a bolt-cutter on hand to cut through fences and wire.
Picks, shovels, axes, chain saws and bow saws allow you dig and gather and cut wood.
Rope and paracords are essential for assembling simple and complex survival systems.
Tarps are necessary as ground covers or for weather-proofing, Stock pile nails and plywood for building and repairs.
Keep large trash bags for waste disposal, Have gasoline for fuel or a fire starter, Get a propane stove for cooking, Have a fishing rod for catching fish.

Method 5 Preparing Your Family.
1. Make sure everyone is aware of the situation. In order to prepare for economic collapse, you will have to make sure that your whole family is on board with your preparations. This means informing them in honest terms what is about to happen and telling them what they should be doing. Make sure everyone takes the situation seriously. Otherwise, they will not be mentally prepared in the event that economic collapse actually occurs.
2. Check that each family member is individually prepared. Inform each other family member of the steps you have taken to prepare your finances, essential supplies, food, and shelter. Instruct them on doing the same. Make sure each family member has also packed a bag of essentials that they can grab if they are forced to leave the house without notice. This bag should contain enough survival essentials to last between 72 hours and a week.
3. Train family members in survival skills. Your immediate family members should be aware of how to handle weapons safely, perform basic first aid, hunt or grow food, and maintain your shelter. If they don't already have these skills, take the time to instruct them thoroughly. You never know when you might have to depend on them.
4. Work with another family or group. In addition to your immediate family, consider including other family members, neighbors, or a community group (like a church group) in your preparations. Make sure that these are people who are reliable and will put in work for the benefit of the group. You will be safer and work more efficiently if you can increase the size of your group.

Method 6 Anticipating a Financial Crisis.
1. Monitor the financial markets. Calm markets tend to go up. But if the market gets choppy, meaning prices swing up and down considerably, it will likely decline. Don’t be fooled if he market soars for one day. Big ups and downs in the markets are a red flag signaling an overall decline.
2. Keep an eye on global 10 year bond yields. Global bonds are bonds that are issued in several countries at once by governments or large multi-national companies. When 10 year global bond yields drop, it is in indicator that investors are withdrawing their money to put it in safer investments. This happened before the financial crisis that happened in 2008. A significant drop in 10 year global bond yields means that investors think a financial crisis is coming.
3. Pay attention to oil prices. The fluctuation of oil prices has a macroeconomic impact. When oil prices increase, the Gross Domestic Product (GDP) goes up too. The GDP is a quantitative measure of the nation’s total activity. If it is increasing, then the value of goods and services is also going up. If periods of high oil prices signal good times for the world economy, then the opposite is also true. If oil prices are on the decline, expect the GDP and the financial markets to also decline.
4. Understand the relationship between inflation and economic growth. Economic growth tends to lead to inflation. As demand increases, prices are driven up and unemployment falls. As unemployment falls, wages increase. As wages increase, people spend more, which leads to inflation of prices. Conversely, when economic activity slows down, so does inflation. Therefore, if the price of goods and services slows dramatically, it could signal a major downturn in the economy.
5. Monitor the price of commercial commodities. Commercial commodities are goods exchanged during commerce, such as gold, lumber, beef or natural gas. Changes in the prices of commodities affect the United States economy and the value of the U.S. dollar. An increase in commodity prices is correlated with an increase in inflation. Increased inflation correlates with economic growth. However, if commodity prices drop, inflation slows, which indicates economic decline.

Community Q&A.

Question : Where can I join a survival group to prepare for the potential economic collapse?
Answer : Facebook groups are the best place to start. Search for survival groups.
Question : Why would I pay off my debt first? If the economy collapses, my creditors' well being will take a backseat to my family's well being.
Answer : If you owe money to creditors, you would be putting your family at risk during such a time if you failed to keep paying back debts. Creditors are enabled by law to come and claim some of your assets if you have stopped paying them in order to protect your family's well being. In a time like this, assets are everything.
Question : Is an investment in gold and/or silver appropriate? If so, what are your recommendations, and why?
Answer : While gold used to be the standard for currency, it is still very valuable during recessions. Purchasing gold or silver can be a great way to diversify your investments.
Question : If I have a high car payment, and my IRA is large enough to pay off the vehicle, should I close the IRA and pay off the car?
Answer : Sell your expensive car and purchase an older, reliable vehicle with cash. One should never finance an item that depreciates in value, and keep your IRA.
Question : When is the economic collapse expected? In 2018 when bond yields drop?
Answer : No one really knows, but we can predict certain fluctuations (presidential elections or new terms, corporations moving out of the country, major world events, etc.) It's just best to be prepared for it with at minimum a month's supply of essentials.
Question : Should I get out of all stocks if preparing for economic collapse? Should I pay off my mortgage if I have the stock to do so?
Answer : No. Hedge your bets by keeping your portfolio 60% in stock index funds and 40% in bond index funds. I recommend Vanguard because of the low fees. Also, do not pay off your mortgage. You need cash flow. In a collapse, you will have the moral authority to defend your home with violence if necessary.
Question : With a low fixed rate mortgage, should I have my house paid off when the U.S. dollar crashes?
Answer : If you can, hold onto the cash needed to pay off your mortgage. When the dollar crashes, it won't be worth much for buying anything, but the bank still has to take it for your mortgage.
Question : What is the best way to reduce my losses on a savings account if the currency is devalued?
Answer : The best way is to not have a savings account at all. You have more liquidity keeping your money in your checking account. So take that money out of your savings account and open up another checking account with a debit card. Do not use it.

June 02, 2020

How to Be Smart with Money

How to Be Smart with Money.

Being smart with money doesn’t have to involve high risk investments or having thousands of dollars in the bank. No matter what your current situation is, you can be more financially savvy in your everyday life. Start by building a budget to help you stay within your means and prioritize your financial goals. Then, you can work on paying down your debt, building up your savings, and making better spending decisions.

Method 1 Managing Your Budget.
1. Set your financial goals. Understanding what you are working toward will help you build a budget to meet your needs. Do you want to pay down debt? Are you saving for a major purchase? Are you just looking to be more financially stable? Make your top priorities clear so that you can build your budget to fit them.
2. Look at your overall monthly income. A smart budget is one that doesn’t overextend your means. Start by calculating your total monthly income. Include not just the money you get from work, but any cash you get from things like side-hustles, alimony, or child support. If you share expenses with your partner, calculate your combined income to figure out a household budget.
You should aim to have your overall monthly spending not exceed what you bring in. Emergencies and unforeseen occasions happen, but try to set a goal of not using your credit card to cover non-necessary items when your bank accounts are low.
3. Calculate your necessary expenses. Your first priority in building a better budget should be those things that need to be paid every month. Paying these expenses should be your first priority, as these items are not only necessary for daily function, but could also damage your credit if you fail to pay them in full and on time.
Such expenses may include your mortgage or rent, utilities, car payments, and credit card payments, as well as things like your groceries, gas, and insurance.
Set your bills up on autopay to make them easy to prioritize. This way, the money comes right out of your account on the day the bill is due.
4. Factor in your non-essential expenses. Budgets work best when they reflect your daily life. Take a look at your regular, non-essential expenses and build them into your budget so that you can anticipate your spending. If you get a coffee every morning on the way to work, for example, throw that in your budget.
5. Look for places to make cuts. Creating a budget will help you identify things you can cut from your regular expenses and roll into your savings or debt payments. Investing in a good coffee pot and a quality to-go mug, for example, can really help you save long-term on your morning fix.
Don’t just look at daily expenses. Check things like your insurance policies and see if there are places you can scale back. If you are paying for collision and comprehensive insurance on an old car, for example, you may opt to scale back to just liability.
6. Track your monthly spending. A budget is a guideline for your overall spending habits. Your actual spending will vary each month depending upon your personal needs. Track your spending by using an expenses journal, a spreadsheet, or even a budgeting app to help you ensure that you are staying within your means each month.
If you do mess up or go over your budget goals, don’t beat yourself up. Use the opportunity to see if you need to revise your budget to include new expenses. Remind yourself that getting off-target happens to everyone occasionally, and that you can get to where you want to be.
7. Build some savings into your budget. Exactly how much you save will depend upon your job, your personal expenses, and your individual financial goals. You should aim to save something each month, though, whether that’s $50 or $500. Keep that money in a savings account separate from your primary bank account.
This savings should be separate from your 401(k) or any other investments that you have. Building a small general savings will help you protect yourself financially if an emergency comes up, such as a major repair around the house or unexpectedly losing your job.
Many financial experts recommend a target savings of 3-6 months’ worth of expenses. If you have a lot of debt you need to pay down, aim for a partial emergency fund of 1-2 months, then focus the rest of your cash on your debt.

Method 2 Paying Off Debts
1. Figure out how much you owe. To understand how to best pay down your debt, you first need to understand how much you owe. Add together all your debts, including credit cards, short-term loans, student loans, and any mortgages or auto financing you have in your name. Look at your total debt numbers to help you understand how much you owe, and how long it will truly take to pay it off.
2. Prioritize high-interest debts. Debts like credit cards tend to have higher interest rates than things like student loans. The longer your carry a balance on high interest debts, the more you ultimately pay. Prioritize paying down your highest interest debts first, making minimum payments on other debts and putting extra money into your top debt priorities.
If you have a short-term loan like a car title loan, prioritize paying that down as quickly as possible. Such loans can be devastating if not paid off in full and on time.
3. Go straight from paying off one debt to the next. When you pay off one credit card, don’t roll that payment amount back into your discretionary funds. Instead, roll the amount you were paying into your next debt.
If, for example, you finished paying down a credit card, take the amount you were putting toward your credit card and add it to the minimum payment for your student loans.

Method 3 Setting Up Savings.
1. Pick a savings goal. Saving tends to be easier when you know what you’re saving for. Try to set a goal, such as building an emergency fund, saving for a down payment, saving for a major household purchase, or building a retirement fund. If your bank will let you, you can even give your account a nickname such as “Vacation Fund” to help remind you of what you’re working toward.
2. Keep your savings in a separate account. A savings account is generally the easiest place to put your savings if you are just starting out. If you already have a solid emergency fund and have a reasonable amount to invest, such as $1,000, you may consider something like a certificate of deposit (CD). CDs make your money much harder to get to for a fixed period of time, but tend to have a much higher interest rate.
Keeping your savings separate from your checking account will make it harder to spend your savings. Savings accounts also tend to have a slightly higher interest rate than checking accounts.
Many banks will allow you to set up an automatic transfer between your checking and savings accounts. Set up a monthly transfer from your checking to your savings, even if it’s just for a small amount.
3. Invest raises and bonuses. If you get a raise, a bonus, a tax return, or another unexpected windfall, put it in your savings. This is an easy way to help boost your account without compromising your current budget.
If you get a raise, invest the difference between your budgeted salary and your new salary directly into your savings. Since you already have a plan to live off your old salary, you can use the new influx of cash to build your savings.
4. Dedicate your side gig money to your savings. If you work a side gig, build a budget based on your primary source of income and dedicate all your earnings from your side gig to your savings. This will help grow your savings faster while making your budget more comfortable.

Method 4 Spending Money Wisely.
1. Prioritize your needs. Start each budget period by paying for your needs. This should include your rent or mortgage, utility bills, insurance, gas, groceries, recurring medical expenses, and any other expenses you may have. Do not put any money toward non-necessary expenses until all of your necessary living costs have been paid.
2. Shop around. It can be easy to get in the habit of shopping in the same place repeatedly, but taking time shop around can help you find the best deals. Check in stores and online to look for the best prices for your needs. Look for stores that might be running sales, or that specialize in discount or surplus merchandise.
Bulk stores can be useful for buying things you use a lot of, or things that don't expire such as cleaning supplies.
3. Buy clothes and shoes out-of-season. New styles of clothes, shoes, and accessories generally come out seasonally. Shopping out-of-season can help you find better prices on fashion items. Shopping online is particularly useful for out-of-season clothes, as not all stores will have non-seasonal items.
4. Use cash instead of cards. For non-necessary expenses such as going out to eat or seeing a movie, set a budget. Withdraw the necessary amount of cash before you go out, and leave your cards at home. This will make it more difficult to overspend or impulse buy while you're out.
5. Monitor your spending. Ultimately, as long as you're not spending more than you bring in, you're on target. Regularly monitor your spending in whatever way works best for you. You may prefer to check your bank account every day, or you could sign up for a money-monitoring app such as Mint, Dollarbird, or BillGuard to help you track your spending.

April 11, 2020