DIY, Financial Planning

5 Financial Goals to Start in 2021

 

Although many people start New Year’s resolutions in January, there’s nothing magical about January with regards to self-improvement. Still, the best time to make a change or set a goal is today, so if you’re ready to level up in your life, there’s no time like the present. Here are five financial habits that you might consider starting this year. 

Commit to a written budget (and review it often)

The very first thing that you’ll want to do is commit to a budget. Having a budget is the cornerstone and foundation for financial success. Knowing where your money is going (and not going) can help you understand where you’re at. If you’ve had trouble making or keeping a budget, resolve to start a budget this year. A tool like Mint can be a great way to put your budget on autopilot.

Remember that a budget is just a tool to help you to not spend money on the things you don’t find important so that you have money to spend on the things that you do find important. If you already have a budget, make it a habit to review your budget, at least monthly. That can help you identify where you might be able to make improvements.

As you start or recommit to your budget, make sure that it is written down. Budgets that are not written down, like goals, tend to fall by the wayside easily.

Start (or build) your emergency fund

Another great habit to get into in 2021 is starting an emergency fund. An emergency fund should be one of the very first things you do with any extra money you have in your budget. Even before working on eliminating your debt or saving for retirement, it makes a lot of sense to set aside money for emergencies.

A good rule of thumb is to start with a $1,000 emergency fund. It may not cover catastrophic emergencies, but it can help you to avoid having to spend on your credit cards when the unexpected happens. After you’ve started that basic emergency fund, then you can continue to build it up while also starting to pay off debt or invest for the future. If you can, it’s a good idea to have a couple of months of expenses in your emergency fund. That way you’re covered for a while in case you lose an income source or have a major emergency.

Make a plan to eliminate your debt

The next habit to start or continue this year is to eliminate your debt. Depending on how much debt you currently have, it may not be realistic to pay off all of your debt in 2021. But no matter what, you should have a plan in place. There are a variety of different debt repayment strategies – the debt snowball and the debt avalanche among many. It’s important to pick a debt payoff approach that works for you, and that you can stick to. Make it a habit to spend less than you earn and work towards becoming debt-free.

Spend with a purpose

Another great habit that can help you live within your means is to spend with a purpose. Spending with a purpose means that you are conscious with your spending. If you ever find yourself wondering where all your money has gone, you may benefit from being more deliberate with your spending.

Many people find success by setting a rule about any non-essential spending. For example, before you make any purchases besides essentials like rent, utilities, and debt payments, you must write it down. Just the act of writing it down (or taking a picture of it) is enough for many people to be more deliberate and conscious about what they choose to spend their money on.

Pay yourself first, and make sure to give yourself a raise

If you’re like many people, you may have good intentions of saving money each month, but at the end of the month, you find there’s nothing left over after all the bills are paid. One habit that people who are successful financially have is to pay themselves first. Put your savings money aside at the BEGINNING of the month. It’s a bit of a mental trick, but many people find that having that money out of sight helps them to save more.

Another financial habit to start is to always give yourself a raise. Whenever you get a raise at work or come across any “extra” money, IMMEDIATELY put it either in your emergency fund or use it to pay down your debt. Putting any raise or extra money towards your savings (instead of increasing your standard of living) is a great habit to start. 

This is a great habit to start, especially if you are young or just starting out in your professional life.  Of course, paying yourself first and giving yourself a raise, doesn’t mean that you have to only eat ramen or can’t have nice things. But thanks to the magic of compound interest, the sooner you start to save and invest, the better off you’ll be.

The post 5 Financial Goals to Start in 2021 appeared first on MintLife Blog.

Source: mint.intuit.com

DIY, Financial Planning, Personal Finance

3 Financial Self-Care Habits You Can Start Today

If you’re someone who struggles with financial anxiety and stress, practicing a financial self-care routine could help. Just like other areas of your life, the more consistent you are about financial self-care, the better. This is why I am emphasizing the idea of building habits. The reality is that anxiety and stress are life’s constants. We ourselves don’t have the luxury of removing those factors from our environment, but what we do have are tools to help manage and reduce them. 

Before I get into it, I want to note that there’s a pretty extensive list of financial-self care options available, but what I’ve realized is that when we are struggling, we often overcommit ourselves to perfectionism instead of trying to be a little less imperfect. I’m the first to admit that it’s really tough not to go all-in when reading advice that sounds life-changing. Often, we find ourselves trying out anything and everything to feel in control, and it is for this reason that I won’t offer you the extensive list today. Instead, I hope to help you focus on taking things slow for once so that you don’t set yourself up for failure (and ultimately right back in the anxiety-ridden state you first found yourself in). You can view these three foundational habits as a starting point for a long-term financial self-care routine that you will work to enhance over the course of your life. With this in mind, let’s dive in.

HABIT # 1: REVIEW & CATEGORIZE YOUR TRANSACTIONS DAILY

Building awareness of what and how much you’ve spent can be a game-changer. This habit not only takes the dreaded guessing game out of your end-of-month leftover income and total spending, but it can help you course-correct throughout the month to ensure you hit budgeting goals, cut back in areas you may find yourself regretting, or even upping your spend in areas that bring you joy. A few added bonuses of this habit include saving time at the end of the month if you’re someone that typically sits down for 4-5 hours to get yourself organized, in addition to helping you catch fraudulent transactions faster! 

Pro tips for building this habit: 

  • Make it easy: If you don’t already use Mint, download the app today to have all of your transactions organized and easily viewable in one place. 
  • Make it obvious: Set a calendar reminder on your phone to check Mint each day at the same time. I’d recommend early morning before your day gets busy.
  • Make it attractive: Check your spending after a ritual or habit you enjoy doing. For example, after you sit down to drink your coffee, open up Mint to review your transactions.    
  • Make it satisfying: After reviewing your transactions, do something rewarding. For example, after categorizing and reviewing, consider checking it off your to-do list for the day to feel progress.

HABIT # 2: CHECK YOUR SAVINGS ACCOUNT(S) DAILY

Checking your savings accounts is a great way to flood your brain with positivity about your financial situation. Having savings is a rewarding feeling, and even more rewarding, is seeing your savings progress over time. Getting in this habit will also be a good reminder to actively save for each of your financial goals. 

Pro tips for building this habit: 

  • Make it easy: Connect your savings accounts to Mint and use the goal-setting feature that allows you to customize your savings goals and connect your savings account to easily track your progress. 
  • Make it obvious: Consider setting your phone’s background to a photo of something you’re saving for so that everytime you check your phone, you’ll be reminded of saving. Mint also allows you to add photos of your goals in the web version and in the app. 
  • Make it attractive: In addition to checking your savings right after reviewing your transactions in Mint, consider starting a savings group with your friends and family. No need to talk about how much you’ve saved, but you can talk about your goals and turn to the group for motivation when you’re tempted to spend what you would normally save. 
  • Make it satisfying: Make sure to give yourself credit for doing this habit by also crossing it off as a separate to-do list item. Try to also make it a rule to never miss checking your savings twice in a row. Skipping a day here and there because life gets in the way is totally normal, just make sure to commit yourself to doing it the next day. 

HABIT # 3: REWARD YOURSELF 1X PER WEEK

I saved the best for last. Rewarding yourself is a critical step that most skip when trying to become more disciplined. Self-control can be a draining experience, especially at first. Make sure to set aside “free time” each week to do something for yourself. It doesn’t have to be big, and it doesn’t have to require a lot of money. Think of it as a way of telling yourself good job for working hard and trying to improve. 

Pro tips for building this habit*: 

  • Make it easy: Consider making your reward something that takes less than 2 minutes to start doing. Perhaps it’s turning on a Netflix show, making an easy dessert, grabbing a coffee at the Starbucks you just walked by, or even dancing in your living room to your favorite song. 
  • Make it obvious: As I write this, it sounds weird, but for some of us, setting aside time for ourselves isn’t something we’re good at, so commit yourself to a consistent day and time that’s for you to do what you want.

*Making it attractive and satisfying isn’t necessary here because the reward in and of itself will reinforce the habit. 

 

With that, you now have 3 habits to start building a financial self-care routine. Give this a shot, and let me know how it goes in the comments below. 

The post 3 Financial Self-Care Habits You Can Start Today appeared first on MintLife Blog.

Source: mint.intuit.com

DIY

Mint Money Audit: Making the Most of a Side Hustle

This week’s Mint audit introduces us to Selena, 48, a mom of two living in San Antonio, Texas. She is a community college director and her husband, 51, is a full-time graphic designer who also manages a booming side hustle in the same industry.

Selena and her husband have already achieved some impressive financial accomplishments, thanks to tracking their finances on Mint, leveraging coupons and shopping at thrift stores. They’ve paid off $52,000 in student loans and invested in a piece of land next door for $26,000, which they believe has appreciated by nearly 40% since purchasing it a few years ago.

But with retirement looming and two children (currently ages 9 and 12) to possibly put through college, Selena wants to learn about additional money moves that could better prepare them for future expenses. She would also love to pay off the family’s 30-year mortgage before she retires in the next 10 to 12 years. Currently they’re on track to pay it down by 2030.

First, a breakdown of their finances:

NET INCOME

  • Hers: $56,000
  • His: $40,000 plus an additional $40,000 in freelance work
  • Total: $136,000 per year

DEBT

  • Just paid off student loans and a property loan (for the lot next door)
  • Credit Card Debt: $0
  • Mortgage: $163,000 (Monthly payment, including real estate tax, is $1,985)
  • Car note: $5,300 (should be paid off within the year)

RETIREMENT SAVINGS

  • Selena’s teacher pension: Roughly $5,000 per month at retirement if she retires in 12 years ($3,800 if she retires in 6 years).
  • Various IRAs between the two of them: $65,000
  • Estimated social security payments: $2,500 to $3,000 (combined)
  • Husband does not have a 401(k)

RAINY DAY SAVINGS

In an emergency, the family has at least six months of expenses saved up or roughly $35,000.

COLLEGE SAVINGS

Selena and her husband haven’t specifically saved for their children’s college education. They’re concerned that a 529-college savings plan might limit their children’s options, if they didn’t choose to attend a traditional college program.

Recommendations

Leverage the Side Hustle

All in all, I think the family’s finances are in solid shape. But if they’re interested in further securing their future, I would suggest investing the annual side hustle income (which currently sits in a bank account earning no interest) to advance retirement savings and carve out an account for their two children.

Starting that side hustle was a very smart money move because it effectively boosted the family’s net income by 40%. And according to Selena, the business, which they operate out of their living room, is only growing, with profits expected to grow another 30% in the future.

Income from side hustles is how I managed to pay off debt in my 20’s and boost savings. Today, it’s more prevalent among working Americans. More than 44 million Americans have a side revenue stream, according to a recent survey by Bankrate. “Having a side hustle is fiscally responsible,” says Susie Moore, founder of the program Side Hustle Made Simple and the new book, “What If It Does Work Out: How a Side Hustle Can Change Your Life.” “It’s an economic hedge that mitigates disruption to wealth building and future planning. There is no such thing as a fixed income,” she says.

So, let’s do some math and see how far this $40,000 per year side revenue stream can go using a compound interest calculator.

Retirement

The couple’s retirement nest egg is not too shabby. Not including their existing IRAs, the couple has about $8,000 a month coming to them in retirement between social security and Selena’s pension. That amount, alone, basically replaces their current full-time income. (And I do recommend Selena wait 12 years before retiring so that she can take advantage of the maximum pension payment.)

But with all the uncertainty around social security and future health care costs, it can’t hurt to save a little more, right? By placing $6,500 in a Roth IRA each year for the next, say, 15 years (Selena’s husband can qualify for the catch-up contribution since he is 5- years old), they’ll have an additional $142,000 for retirement that won’t be subject to taxes. This assumes an average annual return of 4%. They can open a Roth IRA at any bank.

Future Savings for Children

While a 529 plan may not be the best fit for this family, Selena still would like to carve out savings for her kids’ future endeavors, be it to start a business or attend an alternative school. For this, I’d recommend opening a 5-year certificate of deposit or CD and placing $25,000 in it this year. The going yield right now for a 5-year CD at that deposit level is averaging a little more than 2%.

Then, every year, as income rolls in from the side hustle, create a new 5-year CD and deposit $25,000 in it. Do this for the next four or five years. All CDs will have matured by the time her youngest is starting college (or pursuing something else). And they’ll have at least $100,000 plus interest reserved for their kids. If they do choose to go to college, the family’s prepared to help pay for in-state tuition at one of the fine Texas universities.

Mortgage Payoff

After funding the Roth IRA each year ($6,500) and the annual CD contribution ($25,000), the family’s left with $8,500. They could choose to put this toward the mortgage principal to knock a few years off their payoff schedule. Or, they may want to just hold onto it for that annual family vacation. And if I’m being honest, I’d say, go for the vacation! They deserve it!

The post Mint Money Audit: Making the Most of a Side Hustle appeared first on MintLife Blog.

Source: mint.intuit.com

DIY, Family Finance, Home Buying, Mortgage Tips

9 Things I Wish I Had Known About Owning My First Home (Before I Bought It)

sturti/iStock

Years before I ever dreamed of homeownership for myself, I was an HGTV connoisseur. In college, I double majored in “Property Virgins” and “House Hunters” and spent hours glued to the TV with my roommate, ogling other people’s granite countertops.

Fast forward nearly a decade, and the time had arrived for me to purchase my own home. (No granite countertops here—my house was more like the “before” scene in an episode of “Fixer Upper”).

Not surprisingly, TV homeownership didn’t prepare me for the real thing. There are lots of lessons I’ve had to learn the hard way.

If you’re gearing up for your own journey into homeownership, turn off the TV and gather ’round. I’ll fill you in on a few things I wish I had known beforehand, and a few surprises (some happy, some frustrating) that I encountered along the way.

1. A beautiful yard takes work

That lawn’s not going ti cut itself

mustafagull/iStock

I never met a succulent that I didn’t kill. Even my fake plants are looking a little wilted right now. But even though I don’t have a green thumb, landscaping and yard maintenance are forever on my to-do list.

Each spring, I spray Roundup with impunity, attempting (and failing) to conquer the weeds. My husband handles mowing and edging.

I’ve slowly started to learn which plants can endure abuse, neglect, and a volatile Midwestern climate. I still have a long way to go in my landscaping journey, but all this work has given me a new appreciation for other people’s lush, beautiful lawns.

When you’re house hunting, keep in mind that those beautiful lawns you see—and that outdoor space you covet—come at a steep price. Either your time and frustration, or a hefty bill for professional landscapers, will be necessary to keep things presentable.

2. You might get a bill for neighborhood improvements

Your property taxes should pay for every improvement to the neighborhood, right? Not necessarily.

When my neighbors came together to petition the city for a speed bump on our busy street, the cost was passed on to us homeowners. It wasn’t covered by property taxes, so we got a bill in the mail a few months later. Surprise!

When you’re preparing to buy a house, make sure you budget for homeownership expenses—not just repair and HOA costs, but those pesky fees that crop up when you least expect them.

3. Brush/trash removal? It works differently in every city

You might not be able to just leave your leaves on the curb…

Instants/iStock

As a kid, I spent many fall weekends scooping leaves into yard waste bags that we left on the curb for pickup. But when I became a homeowner, I realized that my early brush with brush removal was unique to the suburb where I grew up. Every city handles it differently, if the city handles it at all.

In Milwaukee, where I live, homeowners can put leaves on the curb for pickup on designated days. For big branches, you need to request a pickup, or potentially dispose of them yourself. Check with your city to find the ordinances and regulations where you live.

4. You’ll want to clean (or hire someone to clean) your nasty windows

Window maintenance was never on my radar as a renter, probably because I never had more than a few windows in an apartment. But then I became the proud owner of many, many windows—and all of them were coated in a thick film of gunk after years of neglect.

After we moved in, I started to tackle the cleaning on my own. But I quickly realized I was getting nowhere fast, and there was no way I could safely clean the exterior windows up in the finished attic.

So, I swallowed my pride and hired window washers. It was some of the best money I’ve ever spent.

5. You may feel a sudden urge to stock up on seasonal decorations

I never looked twice at a $50 wreath or decorative gourd before becoming a homeowner. Now, I have a burgeoning collection of lawn ornaments in the shape of snowmen and spooky cats. Sometimes I don’t even know who I am anymore.

6. You’ll need to create a budget for Halloween candy

Stock up…

leekris/iStock

At least I did in my Halloween-loving neighborhood, where the trick-or-treaters come out in droves.

I spent upward of $100 on candy my first year as a homeowner, and most of it was purchased in a panic at the Dollar Store after I noticed that our supply was dangerously low just halfway through the evening.

Now, I stock up in advance and shop with coupons to save a few bucks.

7. DIY renovation is equally rewarding and soul-crushing

Maybe just call someone next time…

neirfy/iStock

For the first few months after we closed on our house, my husband and I spent every free hour after work and on the weekends ripping out carpeting, pulling nails one by one from the hardwood floors, and scrubbing away at generations’ worth of grime in the bathrooms and kitchen. It was some seriously sick stuff.

Being frugal and ambitious means we can accomplish a lot on a small budget. But acting as our own general contractors became a full-time job on top of both of our full-time jobs.

Simple pleasures like “having a social life” or “Friday night with Netflix” became distant memories. It’s easy now to say it was all worth it, but at the time, I daydreamed about winning the lottery and hiring a team of pros to handle our rehab.

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Watch: Here’s How Low You Can Go in Making an Offer on a Home

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8. My impulse to check real estate listings lingered for a while

When I started house hunting, I obsessively searched for new home listings every day, poring over MLS descriptions and swiping through photos. Reaching for my phone to refresh the realtor.com app became muscle memory.

But after we closed on our house, my impulse to follow the market didn’t disappear overnight. Even though I was a homeowner, I also had a phantom limb where “checking the real estate listings” used to be.

A friend of mine put it best when she wrote about the sensation of loss she experienced when she “no longer had an excuse to occupy [her] free time with these real estate apps.” It’s surprisingly challenging to turn off your home-buying brain after months of being on high alert.

9. You’ll never want to go back to sharing walls

I like my neighbors. I like them even more because, for the most part, I can’t hear them. Gone are the days of people above me making bowling sounds late at night.

Now, I enjoy the sweet, sweet silence of detached living—no adjacent neighbors blasting music or loudly quarreling. All the yard work in the world is worth it for this level of quiet.

The post 9 Things I Wish I Had Known About Owning My First Home (Before I Bought It) appeared first on Real Estate News & Insights | realtor.com®.

Source: realtor.com

DIY, Financial Planning

How to Financially Prepare for Post-Pandemic Life

As the dust slowly begins to settle and we observe businesses putting their action plans in place to recover, we all sit and wonder what this may look like for us. How will I recover from this? How am I going to cover these unexpected expenses? How will I increase my earning potential? Whether you’re navigating the muddy waters of being unemployed, furloughed, return to office plans or continue working remotely – we have many things to consider as time continues to quickly progress. How should we handle debt? Are there any more relief programs or funding? How can we pick up the pieces and properly recuperate what may have been lost? Use the tips below to jumpstart your journey of reclaiming your finances.

Identify your financial focuses

Over the course of this year, many financial goals that were initially set needed to be tweaked or came to a screeching halt altogether. While it would be nice if we could rectify the many financial aspirations we have for ourselves and our families all at once, it’s simply not realistic. To alleviate the impounding pressure many have had to experience for a good chunk of time this year, it’s best to identify two to three key areas of focus. Not only does narrowing your focus help direct where your efforts should lie, it removes unnecessary stress so that a plan of attack can be created and executed upon. For example, if you would like to begin rebuilding your emergency fund, savings or simply get caught up on bills and other overhead expenses – make sure the actionable steps you take align with the overarching goal. This helps create tunnel vision to execute on the goal while quieting the noise of things that can be tackled at a later time. You owe it to yourself and your finances to see these goals through to the finish line.

Revisit your budget and make adjustments as necessary

Many think of budgeting like that pesky chore you put off every single week. It’s that ‘thing’ you know needs to be done, but you always find something else to do instead. However, once it’s done – you’re always glad that you did it. Even if you have to have an adult temper tantrum, pull out the pen and paper (once again) to compare your income with expenses. Has your income increased or decreased? Are there expenses that are no longer on the list? Are there certain wants or luxuries that can be temporarily put on hold until things settle down? Take all of these factors into consideration when recalibrating your budget. Since there’s an increased amount of time indoors, are there any spending habits you’ve noticed that have been on the rise? If these questions are not easily answered, commit to reviewing the last few months of your bank statements. Do you notice more to-go food orders? An increased amount of emotional or impulsive purchases? Be honest with yourself and your habits so that you can address and make changes to healthily rebuild your finances.

Adjust debt payoff plan

If you haven’t taken the opportunity to contact your creditors – consider this as a reminder! It’s imperative you maintain an open line of communication with all lenders. These conversations can potentially lead to various options being available to assist you in your debt payoff process. Remember to keep in mind that you are not the only person experiencing financial hardship, so let pride become a thing of the past and be candid. Are there relief options during the pandemic? Are interest rates being lowered because of the current climate? If I were to miss a payment, what are the consequences? Are negative remarks being reported to the credit bureaus? Be very clear in your delivery. There are thousands and thousands of people attempting to pick up the pieces on their money journey. Take some time to check all creditor accounts for the most recent balances. From there, create (or readjust) your plan based on your personal circumstances. If it’s easier to tackle the smallest debt, shift your attention to those accounts. If catching up and restoring good standing with utilities and other overhead expenses need to be addressed first, do that. There is no right or wrong way to approach your plan; just don’t adopt the spirit of avoidance.

Monitor your credit score regularly

There’s been a huge surge in personal data being compromised due to the pandemic. To protect yourself and your credit score, be sure to obtain a copy of your credit report from at least one of the bureaus (Experian, TransUnion and Equifax) and review regularly. Normally, you are allotted one free credit report every year – however, because of the pandemic you can now request your report weekly at no cost to you until April 2021. We all know there’s a lot on all of our plates, but this can be incorporated in your weekly routine to make sure information stays accurate. During your review if there’s anything that’s false, submit a dispute and be sure to have any supporting documentation that can serve as evidence to support your claim.

Even though we don’t like to admit it, life can present a lot of challenges that we may not be fully prepared for in our ever-changing adulthood journey. This pandemic has shined a light on the areas in our lives that can use some more time, intention and attention. Instead of beating ourselves up about the lack of preparedness, let’s be sure to make adjustments now so no matter what happens with the economy or the state of this country it does not have such a huge, negative impact to our financial goals. Let’s face it – even in the midst of tragedy, this year equipped us with a different level of endurance and resilience. It reminded us what really matters and where our energy should really be dedicated to. Start where you are and do what you can. Refrain from comparing your personal money story to someone else’s. We all have unique situations and obligations that influence our saving and spending plans. Dust yourself off, grant yourself grace and begin a new chapter in your financial journey.

 

The post How to Financially Prepare for Post-Pandemic Life appeared first on MintLife Blog.

Source: mint.intuit.com

DIY, Home Improvement, Real Estate

5 winter DIY home projects

If you’re the type that loves to take on a good DIY project, the winter season can leave your options … lacking. Don’t despair, there’s still plenty that needs to be done around your home even when it’s cold outside. Here’s a list of indoor DIY projects you can start tackling today.

  • Insulate your water heater. A source of heat during the winter, you can reduce your home’s energy usage by wrapping your water heater in insulation to keep your water hot, whether you’re using it or not.
  • Add a programmable thermostat. This one just makes sense when considering energy conservation. Programmable thermostats allow you to control the temperature of your home from anywhere and set preprogrammed temperature guidelines to lower your home’s temp when you’re away and raise it when you return.
  • A fresh coat of paint. Summer is the time for painting your home’s exterior, but the winter was made for inside painting projects. This is an easy way to add vibrancy to those dreary winter months. Just try to pick a day when it isn’t raining or snowing to make your ventilation easier.
  • Clear the clutter. Increase your living space by clearing junk. If you haven’t used it in a year, say goodbye.

 

The post 5 winter DIY home projects first appeared on Century 21®.

Source: century21.com

Debt, DIY, Education, Financial Planning, Investing, Money Management, Mortgage, Personal Finance, Real Estate, Retirement, Student Loans

Mint Money Audit 6-Month Check-In: How Did Michelle Allocate Her Windfall?

In March I offered some financial advice to Michelle, a Mint user who was struggling with debt, a lack of retirement savings and a bit of family financial drama amongst her siblings.

Michelle was anticipating a cash bonus from her company and wasn’t sure if she should save the money or use it to relieve her debt.

I recommended a two-prong approach where she uses the cash to play savings catch-up in her retirement account and knock down some of her debt, which, at the time, included a $3,000 credit card balance and $52,000 in student loans.

Six months later, I’ve checked in with the 38-year-old real estate developer, to see if any of my advice was helpful and if she’s experienced any shifts in her financial life.

We spoke via email:

Farnoosh: Have your finances have improved over the last 6 months since we last spoke? If so, what has been the biggest improvement?

Michelle: Yes. I’ve aggressively been contributing to my 401(k) – about 50% of my pay – and had hoped to reach the annual maximum of $18,000 by June, but looks like it will be more like October. I also received a $40,000 distribution from a project that I closed.

F: What aspects of your financial life still challenge you?

M: Investing for sure. I never know if I’m hoarding too much cash. I am truly traumatized from the financial downturn. I just joined an online investment platform, but it was also overwhelming. Currently I have $45,000 in a regular savings account that earns 1.5%.

Another challenge is not knowing whether to just bite the bullet and pay off my student loans or to continue to pay them monthly.  I hate that I’m still paying loans 16 years after I graduated and it’s a source of frustration [and embarrassment] for me.  I owe $36,000. Often times I have an inner monologue about the pros and cons of just paying them off but then my trauma from 2008 kicks in…and I decide to keep my $45,000 nest egg safely where I can check the balance daily.

F: I recommended allocating $45,000 towards retirement. Was that helpful? What are some ways you’ve managed to save?

M: Yes, I recall you saying you recommended having a total of $100,000 towards retirement for a person my age. Currently, I have $51,000 in my 401(k), $35,000 in a traditional IRA and $17,000 in my Ellevest brokerage account, so I’ve broken the $100,000 goal.

I did add a car note to my balance sheet. My old car suffered a total loss (major electrical failure due to a sunroof leak!) and the insurance gave me a check for $9,000. I used it all towards the new vehicle (a certified used 2014 Acura) and I’m financing $18,000.

F: Your dad’s home was a source of financial stress, it seemed. Were you able to talk with your siblings and arrive at a better place with that?

M: My dad actually has passed since we last spoke. He passed in February and so his will went to probate. My siblings and I have decided not to make any decisions about the house for at least one year. Yes, this is kicking the can further down the street however, they recognize that I maintain the house and pay the real estate taxes and so they are not pressuring me to move or to sell.

The new deed has been recorded and the property is under all our names and so everyone seems ok with knowing that I can’t do anything regarding a sale or refinance unilaterally.

So, for now, I live rent free other than paying utilities, miscellaneous maintenance on the house and real estate taxes quarterly. This, too, is helping me save aggressively.

Also, the new car note has replaced the hospice nurse contribution so I’m not feeling that my budget is overburdened with the new car.

I think ultimately I will buy out at least two of my siblings and stay in the house. Verbally they have expressed being okay with this.

 

Have a question for Farnoosh? You can submit your questions via Twitter @Farnoosh, Facebook or email at farnoosh@farnoosh.tv (please note “Mint Blog” in the subject line).

Farnoosh Torabi is America’s leading personal finance authority hooked on helping Americans live their richest, happiest lives. From her early days reporting for Money Magazine to now hosting a primetime series on CNBC and writing monthly for O, The Oprah Magazine, she’s become our favorite go-to money expert and friend.

The post Mint Money Audit 6-Month Check-In: How Did Michelle Allocate Her Windfall? appeared first on MintLife Blog.

Source: mint.intuit.com

DIY, Financial Planning

What Is an Infopreneur: How to Ace the Modern Day Side Hustle

Over the course of the past two decades, the rise of the infopreneur has been exponential. Infopreneurship is a valuable way to earn passive income for anyone who is highly knowledgeable in one area. The best part is that anyone can be an infopreneur — although it won’t happen overnight. It might be the perfect side hustle for you.

What is an Infopreneur?

In short, an infopreneur is an entrepreneur who specializes in the sale and distribution of information and expertise. As soon as experts across various niches realized they could create “information products” and sell their knowledge online, infopreneurship took the Internet by storm.

Infopreneur pioneers like Tony Robbins and Amy Porterfield have paved the way for a generation of aspiring entrepreneurs in the information age. Robbins and Porterfield are just two examples of infopreneurs capitalizing on the desires of people in their respective niches — self-improvement and online marketing. Even though there is an immense amount of dedication required to become an authority in your niche, being a respected expert pays dividends in the long run.

Quote by Neil Patel about mastering your niche

Working towards becoming a thought leader sets you up for long-term financial success, but it doesn’t happen overnight. Creating your own website, online course, podcast, ebooks, or YouTube channel has never been easier, but these things still take time.

5 Reasons Why It Pays to Be an Infopreneur

Infopreneurship is one of the fastest ways to reach a massive number of people on the Internet with your expertise. To start, you have to choose how you’ll provide valuable free information. Next, you need to build a loyal audience and plan how you’ll eventually charge people for access to premium content. Being an infopreneur can be super rewarding — take a look at some of the perks:

1) You Contribute Real Value to People’s Lives

No matter your area of expertise, chances are that you’re ultimately helping others. This is a win-win situation because you’re earning extra cash while enjoying the gratification of helping someone improve in an area of their life.

2) You Have More Flexibility Working for Yourself

Infopreneurship can be the perfect side hustle. You can do it as a part-time gig as you work a full-time job, go to grad school, or juggle parenting responsibilities. This flexibility and the low stakes of infopreneurship give you a chance to achieve work-life balance. It’s empowering to be an infopreneur because you’re using your knowledge to produce wealth and ensure your own economic security.

Quote by Stephen R. Covey about financial independence

3) You Don’t Experience as Much Pressure as Other Entrepreneurs

Selling information online requires a small initial investment and it usually starts as a solo venture. Traditional entrepreneurship typically involves hiring at least an assistant, and there is a ton of pressure when it comes to selling time-based services or physical products. Meanwhile, a resourceful infopreneur can just outsource tasks as necessary.

4) You Can Strategically Streamline Your Workload

You will have to make the effort to do the work upfront to create your information products, set everything up, and market them, but once it is done, you can enjoy the benefits without having to keep up with tedious tasks. This provides a sense of freedom and allows for creativity in your work.

5) You Control How You Scale the Business

If you know your numbers, you can usually scale your business quickly as an infopreneur. Once you fully understand your target market, how to reach them, and how to present your material in a way that they like, you’re ready to scale. We’re living in the peak attention economy and information age, so the demand for your knowledge already exists.

Take a look at our visual guide below for more tips on stepping into the role of infopreneur to give both your bank account and your professional reputation a boost.

Infographic on the art of being an infopreneur

The concept of an infopreneur isn’t new, but it’s definitely more widespread than it was 10 years ago. The recent surge in popularity is likely connected to the increase in people working from home and freelancing more than ever before.

As an infopreneur, you can be your own boss without having to hire staff, invest in office space or equipment, or worry about other risky financial investments. If you’re looking for a way to keep your budget in check, becoming an infopreneur might be the right move for you.

Sources:

Small Biz Genius | Business Know-How | Quicksprout | GoodReads

The post What Is an Infopreneur: How to Ace the Modern Day Side Hustle appeared first on MintLife Blog.

Source: mint.intuit.com