Tag Archives: saving

How Finance Apps & Online Tools will revolutionize Millennial Financial Planning

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By Drew Hayles 

Special to the Financial Independendence Hub

When you’re young, you feel like nothing can stop you. You’re in charge of your own destiny.

Things might look different in hindsight, but don’t worry about that now. The most important thing you can do right now is set in motion a plan to achieve financial independence as soon as possible. With the means to do what you want, when you want, you’ll open doors you never even knew existed.

Before you begin in earnest, make sure you have the right digital tools and apps in your corner. These user-friendly resources all have their place in a coherent, comprehensive financial independence plan, provided you use them properly and consistently.

Perhaps you’re using a few already.

 Digital Budgeting Tools: All Your Money in One Place

 This list of the “best simple and free budgeting tools” doesn’t get to actual digital solutions until the third entry, when it calls out the trusty old Excel spreadsheet.

If you’re in the market for something a bit more robust and hands-off than a wall of spreadsheet cells, consider later entries like Mint or PearBudget (which, to be fair, began life as an Excel tool).

These aren’t professional-grade tools by any means, but they’re nevertheless robust enough to accommodate basic household budgeting and ensure that you spend well less than you earn. Remember to download mobile versions and link your bank accounts for automated cash flow tracking.

 Automated Savings Apps: Ditch the Reminders

 Tired of remembering (or forgetting) to make regular savings deposits? Take the uncertainty out of the process with automated savings apps that quietly transfer small sums to your savings accounts without any input on your end.

Tools like Digit exist wholly for this purpose. More robust online banking solutions like Chime Bank typically have built-in automated savings features that round up every debit transaction to the nearest dollar and sock away the difference

 Educational Videos: DIY, But for Money

 Are you a DIYer at heart? You can learn a lot from high-quality investing and financial education videos. After all, there’s no need to pay for entry-level information and strategic advice when you’ve got a YouTube account to your name. If you need help or want to learn more about specific topics, you can always go straight to the source with questions.

Lightweight Accounting Platforms for Entrepreneurs   Continue Reading…

6 tips for managing your Kids’ bank accounts

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By Emily Roberts

(Sponsored Content)

It’s 2018 and the days of buying your kids a piggy bank are long gone. It makes much more sense to let your kids have a bank account that will not only help them keep their money safe but also teach them how to grow and save it. Unfortunately, it seems as if most modern banks offer little to no incentive for kids to save their money and many focus on charging them as much as possible.

Transaction fees and unexplained charges can easily chew up what little money you deposit. Many banks will continue to charge exuberant monthly fees on small balances to the point where everything that was deposited is gone within a few months. This is why it’s important for you as a parent to find the right bank account for your kids that will help them get the most out of their money and hopefully grow it at the same time.

1.) Check those transaction fees

Most bank accounts come with a PDF or pamphlet (depending on how you apply) that stipulate the charges for every type of transaction. Sometimes these numbers are changed without notice, so be sure to check the fees for each type of deposit, withdrawal, and transaction. Advise your kids to deposit their money through your account or an ATM at the very least, as doing it over the counter is expensive.

2.) Teach your kids about saving

Educating your children about properly managing their money should be done long before they leave for college. Teach them how interest works, how saving their money is the right thing to do, and how to budget correctly. This way, they’ll know how to manage their funds better when they become independent.

3.) Link their bank to your phone number

Doing this means you can see every transaction that goes through. All of these usually come from a single number, so it won’t fill up your inbox. Not only can you see where their money goes, but if its stolen or their bank accounts are hacked, you’ll know first. Continue Reading…

Why Saving alone isn’t the best way to Financial Independence

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By Elizabeth Lee

Special to the Financial Independence Hub

You’ve been told your entire life that you’ll never be able to accomplish anything unless you have a padded savings account: that every penny you can possibly set aside should be set aside, and you should absolutely never touch it.

You may even have been told that this is the only way you’ll become financially independent. You’ve been told wrong.

Saving is crucially important, but it’s important for entirely different reasons. You shouldn’t go out and spend your nest egg indiscriminately, but spending some of it might help you create a better and stronger independent (“findependent”) future. It all depends on how you strategize.

Why Saving is important

If you’re spending all your money as it comes in, what happens when you run into an expense you didn’t know was coming? Your car breaks down, you need to travel for a destination wedding, you find out you’re going to be a parent a little earlier than you’d originally planned, or you need to go to urgent care for a pesky sinus infection. How are you going to pay for it?

You had no idea that it was coming, and you didn’t budget for any of those things, because you didn’t know they were coming. If you don’t have savings, you might be set so far off track that you need to borrow to pay the bills. Without a savings account, you’re never truly protected from the financial variables life might throw your way.

Why Saving alone won’t make you Financially Independent

You need to spend money to live. Having a pile of money that isn’t doing anything for you won’t unlock a brighter future. Even in a high-yield savings account, the interest won’t amount to much. Financial independence means increasing your income, rather than just having an emergency stash to fall back on when something unexpected happens.

The idea of having savings is not to touch them unless you absolutely need to. The more savings you have, the more protected you are. But they aren’t helping you grow. Financial independence comes through growth, and it’s achieving that goal that will set you up for a smooth ride into your future. Continue Reading…

How to pass on Money values to your kids

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By Matt Matheson

Special to the Financial Independence Hub

(Part 2)

When we had kids, both my wife and I discussed how to be intentional about teaching them about money. We’ve read books, articles, and looked at resources online.  We wanted to be sure that they knew what a healthy relationship with money looked like in the areas of faith, family, and work ethic. We wanted them to know what a truly wealthy life looks like.

Our plan to do this was to model handling our money responsibly. And we wanted to give them real-world opportunities where they could begin to make financial decisions on their own, at first in a supported environment, and later on, independently.

With our first child, our daughter Gemma who’s getting ready to turn 5, we’re in stage 1 of teaching her to be a wise manager of her money. She’s being supported, taught and encouraged to make good choices with her money. She’s also being given lots of opportunity to fail with money. Also known as non-catastrophic failure, it is an essential element to learning, and one many kids are being robbed of by overprotective parents.

So how are we doing it? By teaching her the basics of how to give, save and spend…in that order.

Give

Gemma has been on commission for about four months and it’s been going quite well.  Every Saturday she gets paid $1.50 in six quarters. Some people may think that’s cheap, but I prefer frugal. 

My wife decorated three old loose tea containers with fancy wrapping paper and glitter letters to store her bounty.

The first thing we do when she gets paid is put 25₵ in the Give container. As people of faith, we tithe a percentage of our income to our local church and other charities.  We want to instill the value of generosity and gratitude in our children, and so before we’ve spent or saved, this money goes into the Give fund.

Recently, we went out and used her money (she has stockpiled $4) to buy some gifts for an Operation Christmas Child shoebox. Before we went out I showed her a short video and we talked about how some kids don’t have much money, and how we can give to them.  It was awesome to see her picking out the items for the box and growing her giving muscles right before my eyes.

Save

The next place money goes is to her Save container.  It gets three quarters, the most of any jar.  Before she’s touched any cash to spend, this “invisible money” disappears into her saving fund so she doesn’t even miss it.

We want to impress upon her the value of delaying gratification. We want her to experience the joy you get from passing on the temporary good feeling of spending now, for the amazing feeling of satisfaction and self-control you have when you buy something you’ve been saving up for.

Right now, she’s not saving for a car, university, or a down payment on a house.  We’re not that crazy.  She saves for larger purchases that she wants but can’t buy on impulse and that we’re not going to cave in and get her on a whim.

A Teachable Moment

A few weekends ago, she and I were hanging out and she let me know that she had seen a Spirit Riding Free toy that she wanted to buy. (For those who don’t know, it’s a Netflix show, which is pretty solid for little kids. Continue Reading…

Saving to Retire

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I see too much pessimism on whether it’s possible to achieve a comfortable retirement.

Hence, I highlight three observations on saving for retirement:

  • Surveys frequently remind investors that they don’t save enough for retirement.
  • Investors are keen to know what it takes financially to achieve a comfortable retirement.
  • This is a good time to start the optimistic retirement math discussion.

The number often mentioned is rounding up financial assets of $1,000,000 by age 65. However, accumulating that sum of money may be a tall order for some.

It can be done, but it is not always easy. So, I propose meeting halfway, say at $500,000.

Typical sources of income and capital are the registered accounts, saving accounts, stocks and bonds. Perhaps, income real estate, employer pensions and a family business also fit.

Adding regular savings to your investing plan is simply a must to reach retirement goals. Your degree of financial success has a lifetime of implications.

Assume you begin saving at age 30, 40 or 50 and have no other retirement assets. Here are some annual saving targets to reach $500,000 by age 65 (figures rounded):

Annual Returns to Age 65 Your annual saving targets starting at:
Age 30 Age 40 Age 50
8% $2,900 $6,800 $18,400
7% $3,600 $7,900 $19,900
6% $4,500 $9,100 $21,500
5% $5,600 $10,500 $23,200
4% $6,800 $12,000 $25,000

Say you are age 40, you will need to save $10,500/year to age 65 with 5% returns. That saving target reduces to $7,900/year to your age 65 with 7% returns.

If your aim is to accumulate $250,000, divide the above annual saving targets by two. For the $1,000,000 goal, multiply the above saving targets by two. Continue Reading…