Tag: Financial Education

 

What Is Financial Literacy? And Why Should You Care?

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The majority of Americans are illiterate.

Not in terms of basic reading — most of us can do that — but in terms of our finances.

When the FINRA Education Investor Foundation asked more than 25,000 Americans six simple questions about personal finance, 63% failed. Millennials fared the worst, with a passing rate of just 24%.

This lack of financial literacy is, understandably, having a huge impact on our country. Many of us are paying high bank fees, falling behind on our bills, drowning in debt, and failing to save for retirement. Clearly, something needs to change.

We’re here to help by breaking down what financial literacy means, why it matters, and how you can improve yours. Read on to learn more.

What Is Financial Literacy?

Financial literacy is the ability to understand your money.

When you’re financially literate, you have a grasp on concepts like budgeting, saving, investing, credit, debt, insurance, and interest. And, with a bit of basic knowledge, you’re able to make smart financial decisions about taxes, retirement, real estate, and college.

To Jill Fopiano, CEO of O’Brien Wealth Partners LLC, financial literacy means “the ability to understand and manage important areas of your finances so that you can meet your financial goals.”

This includes financial jargon, too.

“It is as important to be an educated consumer of financial products as it as for any other major purchase,” says Fopiano.

Knowing the difference between a Roth and traditional IRA, or compound and simple interest, for example, can significantly affect your financial future.

Why Does Financial Literacy Matter?

You may think personal finance is boring or unimportant. If you whole family is “bad with money,” you may even think you’re doomed to follow in their footsteps. But the truth is you can transform your life by learning basic financial concepts.

“Financial literacy is the foundation of a life where you feel secure and safe enough to do what you want,” explains Bobbi Rebell, a certified financial planner and host of the Financial Grownup and Money in the Morning podcasts.

“If you don’t have the information, you can’t create a path to your goals,” says Rebell.

For many, one of those goals is retirement. Whereas most Americans used to receive post-retirement benefits from their employers, fewer than 20% of today’s private sector jobs come with pensions. This means you’re responsible for your own future. And, this isn’t something that’s easy to do. In fact, the median amount of retirement savings for a working family is a paltry $5,000.

In addition to affecting your future, financial illiteracy can harm you in the present, too. Take a look:

  • In 2018, the average American lost $1,230 due to a lack of knowledge about personal finance.
  • A shocking 39% of millennial women do not pay their bills on time, resulting in costly late fees and interest charges.
  • A dearth of general financial knowledge, according to one study, cost investors $200 billion over the past 20 years.

“Financial literacy is really about empowerment,” says Fopiano.

“The more you know, the more able you are to make good decisions, avoid sketchy offers, and secure your own future.”

Four Steps to Increase Your Financial Literacy

Since only 17 states require high schools to teach personal finance, it’s important to take your education into your own hands. Here are four steps to help you get started.

1. Devour financial media

As Rebell says, “Becoming financially literate is easier than ever because of the incredible resources we all have access to.”

Feel free to consume information in a way that suits you best. Maybe you’d like to listen to podcasts during your commute; maybe you’d rather watch videos on your days off.

Here are some recommended resources:

2. Take it slowly

Financial literacy is like a tall mountain: You’re not going to reach the summit right away — or maybe ever. The best you can do is take it slowly, tackling one topic at a time.

While you should get a basic grip of personal finance as soon as possible, don’t dive deep into every topic at once. That would be overwhelming, and could discourage you from progressing further.

“Pick an area that is particularly relevant to you — say, budgeting — and commit to mastering it over the next three months. Once you have accomplished that, move on to the next area,” says Fopiano.

3. Ask for help

You probably wouldn’t try to fix your plumbing on your own. Or try to learn chemistry without a teacher. The same goes for money. Although teaching yourself is a fantastic way to get started, you may eventually need some professional assistance.

“This doesn’t have to be a self-study course,” says Fopiano.

“If you are really serious about getting your financial future in order, and could benefit from a sound financial plan, seek out a certified financial planner,” she says.

If you’re not ready for human help yet, turn to financial technology. Use Mint to create a budget and track spending, Charlie to monitor your finances as a whole, Credit Karma to track your credit scores, and Chime to save automatically.

4. Stay curious

The key to financial literacy is, of course, education.

If you dream of becoming financially secure, and stable, and maybe even wealthy, you should keep learning. You should continue your education by reading about personal finance, seeking professional help, and using technology that simplifies the process.

This is your money, after all, and it affects every single aspect of your life.

“Financial literacy is about knowing the right questions to ask. None of us have all the answers, but if we have the right questions we can get there,” says Rebell.

 

Overdraft Protection: What to Know & How to Avoid Fees

Have you ever swiped your debit card and worried that you might not have enough money in your account? If this sounds like you, you might consider overdraft protection to save you from such a predicament.

But is it worth it? Read on to learn all about overdraft protection and overdraft fees.

What is overdraft protection and how does it work?

In general, if you make a purchase with your debit card and don’t have enough funds in your account, the purchase won’t go through. This is typically called an overdraft — which is when you go below your account balance and dip into the negative territory. This situation can be awkward for you and the person behind the cash register. It also can be highly inconvenient if you need whatever you’re purchasing like now.

This is where overdraft protection comes in. Overdraft protection essentially protects you from overdrafting. So, instead of getting your card declined and leading to an uncomfortable situation, your card will go through like normal – even if you don’t have enough money in your account to cover that purchase.

But overdraft protection comes at a price, in the form of overdraft fees which can add up (more on that later). So, while overdraft protection, on the surface, can seem like a great solution to a temporary problem, it’s not all it’s cracked up to be.

So, what does overdraft protection do?

Overdraft protection is a safety net that helps you avoid overdrawing your account. In short, it’s a type of financial protection that will help float you money if you have insufficient funds. So if you swipe your debit card or try to get cash out of an ATM, you may be able to do so even if you technically don’t have enough money in your account.

If interested in this protection, you’d want to talk to your bank and enroll in the program. Additionally, it’s important to know all the upfront costs such as overdraft fees, credit line limits, etc.

Pros of overdraft protection

The main pro of overdraft protection is convenience. Overdraft protection allows purchases to go through, even if you don’t have enough funds in your account. This can save you embarrassment, inconvenience and time. You don’t have to deal with your card getting declined in public or being unable to access cash when you really need it.

How do I use my overdraft protection?

If you want to use overdraft protection, first make sure it’s something you’re signed up for. As noted above, your bank must get consent from you first to enroll you in overdraft protection.

Once you are enrolled, see if you have to link another account or a credit card to complete the process. Each bank may have different policies and procedures.

When it’s set up, overdraft protection will be in place if you overdraw your account. But remember: The hope is that you never have to use it! If you do, this means you’ve run out of money in your account, which is no fun.

Cons of overdraft protection

Overdraft protection seems good in theory but it can cost you in the long run. The fees can vary from bank to bank and your financial institution can decide what to charge. And it’s not just one charge either. You can continue getting hit with overdraft fees if your account is overdrawn.

We found that consumers can get hit with four to six overdraft fees per day. In some cases, that number can be as high as 12. What’s more: Consumers who frequently overdraft end up paying more fees than those who do not opt into overdraft protection. In fact, The Consumer Financial Protection Bureau (CFPB) found that frequent overdrafters who opt into this coverage pay nearly $450 more in fees.

On top of that, if you accrue enough overdraft fees and stay in the negative, you’re at risk of your account being closed. Having your account closed by your bank is more than just a pain, but a major inconvenience on your financial life. Just think about all the bills that are connected to that account, or not having access to your money for a period of time.

All of these are major cons of overdraft protection and should be considered carefully.

The reality of overdraft fees

Overdraft fees – by and large – are big business for many banks. In fact, the average overdraft fee is around $35. In 2017, consumers paid 34.3 billion dollars in overdraft fees in 2017, a number which has been on the rise since the Great Recession.

Even credit unions, which are often thought of as more community-minded and consumer friendly have jumped on the overdraft fee bandwagon. Overdraft fees at credit unions have nearly doubled from $15 in 2000 to $29 in 2017.

In short, overdraft fees are the bread and butter for many financial institutions. They give banks a way to make money off consumers by positioning overdraft protection as a useful service.

What does overdraft protection mean for your credit?

As noted above, in some cases your bank may offer you a line of credit or link your overdraft protection to a credit card. If linked to a credit card, you could end up paying more. Why? Because some card issuers might consider the overdraft a form of “cash advance,” which has its own set of fees, not to mention higher interest rates.

Can you overdraft if you have no money?

To get overdraft protection, your bank will typically connect a savings account and move over funds to cover the overdraft. If you don’t have any money in savings, the protection may not work.

However, other banks have overdraft lines of credit. If eligible, the bank will loan you a line of credit so that your purchases are covered, even if you don’t have enough money in your account. Of course, you will still have to pay it back, with interest, like any other line of credit.

Can you withdraw money from an ATM if you have a negative balance?

If you’re headed to the ATM to get cash, and end up taking out more than you have in your account, you will overdraft. The overdraft definition means that you “overdraw” on your account, which means taking more than you have available.

If you have overdraft protection, you will likely be able to withdraw money from your account and you’d have a negative balance.

But of course, there will be an overdraft fee attached. So while you may get the cash you need, if you don’t have the funds in your account, it will cost more in the long-run.

How can I avoid overdraft protection?

Before 2010, many consumers were unaware that they were being “opted in” to overdraft protection programs. However, starting in 2010, federal regulations shifted and required that banks get consumers’ consent to opt into overdraft protection.

To make things simple, however, you can avoid overdraft protection by not signing up for it with your bank. If you’re currently enrolled in this service, you can cancel it. This way, if you don’t have enough in your account, your purchase or transaction will get declined. While you won’t be able to make the purchase, you also won’t be hit you with an overdraft fee.

Another option is to open a bank account at Chime, which has no overdraft fees.

Lastly, to avoid this problem altogether, keep a buffer of money in your checking account. This can help you avoid dipping into the negative. Check your account balances daily and monitor your bill due dates and auto-drafts. This way you’ll know when money is coming out of your account.

Final word

There are certainly pros and cons with overdraft protection.

It can be convenient, yet costly. It can save you embarrassment and time, but also take a bite out of your hard-earned money. So, weigh these pros and cons carefully.

Final tip: If you never want to worry about an overdraft fee again, consider switching to a no-fee bank account.

 

101 Ways to Save Money

Looking for savings tips but don’t know where to start?

Well, you’re in luck. We’ve rounded up 101 savings tips all in one place. Whether you’re looking for ways to save money on housing, food, travel or even pets, we’ve got you covered. Check out our guide on ways to save money, broken down into nine categories.

Easy Ways to Save Money Today

1. Go on a cash diet

Put a pause on your credit card use and go on a cash diet. Using only cash will ensure you spend only what you have. This can help you save money and avoid debt.

2. Pay off high interest debt first

If you have multiple loans, pay off your high interest debt first. This is commonly referred to as the “avalanche method”. You put extra money toward your high interest loans while paying the minimum toward your other loans. This can help you save money on interest.

3. Avoid fees

Fees can pop up everywhere. Avoid overdraft fees and monthly maintenance fees by switching to a no-fee bank. Pro tip: Chime has no fees at all.

4. Know your spending triggers

We all have spending triggers. Spending triggers can be certain emotions or places that encourage you to spend. For example, if you can’t go by a Starbucks without spending money there, that’s a trigger. If you indulge in retail therapy after a crappy day, that’s a trigger. Knowing your spending triggers can help you avoid spending when you don’t need to.

5. Refinance student loans

If you feel like you’re paying too much in student loan interest, you might want to consider student loan refinancing. This can be a smart move but it’s important to note that not everyone will qualify. You need to have good credit and consistent income. Additionally, you will give up important and lucrative federal protections like income-driven repayment and student loan forgiveness. Here’s a good place to learn about refinancing options for student loans.

6. Use autopay on your student loans

Many student loan servicers offer a .25% interest rate reduction if you sign up for autopay. Autopay automatically withdraws your student loan payment each month. So, if you time it right and have money in your account, this can save you money on interest.

7. Make bi-weekly student loan payments

Your student loan interest accrues daily. In order to combat this, you can make bi-weekly student loan payments. Instead of making one monthly payment, cut that in half and pay it every two weeks. You’ll save money on interest this way.

8. Pay your credit card balance in full

Interest rates on credit cards can be high. Paying off your credit card balance in full each month can help you avoid paying interest charges.

9. Start investing

One way to build wealth in the long-term and beat the cost of inflation is to start investing. You can invest in the stock market with exchange-traded funds, index funds, or other investment vehicles. The point is to put money aside and let the magic of compounding help it grow.

10. Switch banks

Does your bank charge fees for everything? Say G-O-O-D-B-Y-E. You can switch to a bank like Chime that has no fees. Your financial institution should have your back and not tack on fees everywhere you look.

11. Dispute errors on your credit report

Your credit report has information on it that affects your credit score. Your credit score, in turn,  can determine what interest rates you get on auto loans, credit cards and more. You can check your credit score on Credit Sesame or Credit Karma and check your credit report at AnnualCreditReport.com. If you see any errors, dispute them right away to make sure you aren’t getting locked into higher rates due to mistakes or inaccuracies.

12. Use credit card rewards

Do you have a credit card that has rewards? If you have a cash-back credit card, use your cash-back to fund your savings or help offset your budget. If you get miles, use them to save money on travel. Just be sure to read about any restrictions or limitations.

13. Take advantage of balance transfer cards

If you’re in credit card debt and have decent credit, taking advantage of a balance transfer credit card can help you save money. A balance transfer card offers zero percent APR for a period of time on balances that you transfer. So, if you can pay off your debt within the promotional period and don’t accrue more debt, you can save money on interest. Just be aware of potential balance transfer fees.

14. Adjust your tax withholding

If you get a big tax refund every year, you might want to consider adjusting your tax withholding. Adjusting your tax withholding could score you more money now and boost your paycheck. You can also put extra money into your savings.

15. Pay bills on time

Sounds simple, but pay your bills on time. Late fees can add up and catch you off-guard if you’re not careful. Keep track of due dates in your calendar and sign up for alerts.

16. Borrow only what you need

If you take out a student loan or other type of loan, try to only borrow what you need. Sometimes you get approved for much more but don’t let that tempt you. This can help you save money on your debt repayment.

17. Track expenses

A key to mastering your finances is tracking your expenses. You can track your spending using Mint or some other budgeting app. You can also do it manually with pen and paper for at least 30 days. Tracking your expenses can help you save money by making you more aware of where your money is going.

18. Sign up for bank and credit alerts

Signing up for bank and credit alerts can help you stay on top of your finances. If there are any fraudulent charges, you’ll get notified right away. If someone opens a new credit account in your name, it can trigger an alert. You can also sign up for alerts with your bank.

19. Automatically save 10 percent with every paycheck

Pay yourself first is a common adage in personal finance. If you have a Chime bank account, this is super easy. You can start now by automatically saving 10 percent every payday.

20. Create a budget

A budget can help save you money because you know where every dollar is going. Look at your after-tax income and create a budget for all your needs and wants. You can use apps like Mint or Tiller to help you get started.

21. Check your insurance deductible

If you want to save money on your insurance, you might consider boosting your deductible. High deductible insurance plans can save you money in the long run, especially if you don’t use your insurance often.

22. Write off charitable donations

Do you make any charitable donations? Save your receipts as you may be able to take a tax deduction. And always check with a tax advisor if you’re unsure about how you can benefit financially from your donations.

23. Save with a Traditional IRA

Want to save for retirement and save money on taxes? You may qualify for a tax deduction by saving for retirement with a Traditional IRA. Contributions to a Traditional IRA are tax deductible, which can lead to some tax savings.

How to Save Money on Shopping

24. Have a no-spend day

Commit to having at least one no-spend day each week. A no-spend day is when you spend absolutely no money. Make sure you have food and toiletries on hand and plan ahead. Having one, or several no-spend days can help you lower your spending and thus save you money.

25. Use paper coupons

You can still get some savings by looking at the paper coupons you get in the mail. Give it a quick look to see if you can score some savings. And, here’s another tip: If you shop at CVS, make sure you use the reams of coupons you get with your receipts.

26. Use Ebates or Honey

Shopping online? Use Ebates which offers cash back on certain stores when you buy online. You can also use Honey, which is an extension that automatically applies discount codes to your online purchases.

27. Buy generic

You don’t have to buy name-brand products all the time. You can buy generic prescriptions, generic dish soap, etc. This can save you money and in many cases, these products are exactly the same as the brand name counterparts.

28. Use free shipping codes

Look for free shipping codes or free shipping altogether. You can check out RetailMeNot for free shipping codes. You can also sign up for a free Amazon Prime trial and get free shipping (just make sure you cancel after the trial if you are no longer interested in Prime).

29. Buy in bulk

There are certain staples like toilet paper or rice that just make sense to buy in bulk. If you know that you always use a certain product or item, consider buying it in bulk at Costco or another wholesale club.

30. Shop off-season

The best time to shop for a specific holiday is after the specific holiday. I just saw 70% off Valentine’s Day items. I remember seeing the same thing for Christmas and Halloween. If you have room to stock up on items ahead of time, shopping off-season can score you huge savings.

31. Buy used

There’s no need to buy everything new. You can buy used clothing, used electronics and more. You can go to Goodwill or check out OfferUp or Craigslist for used deals.

32. Comparison shop

Always comparison shop! It’s easy to be lazy if you find something you like, but check two other places to make sure you’re getting the best deal.

33. Make gifts

Do you have a knack for making things? Make gifts instead of buying them. This can help you save money and give the recipient something special and unique.

34. Repair items

In today’s disposable culture, if something is broken, it’s easy to throw it away and buy a new one. If possible, however, repair your items. Sew your clothing, repair your lamp, etc. You can check out YouTube tutorials and try to fix it yourself before throwing down some extra cash for something new.

35. Read the fine print

Always read the fine print. You don’t want to have a “gotcha” moment and be caught off guard. For example, if a travel rewards credit card has a spending minimum before a certain amount of time, you’ll want to reach that before the time is up. If you cancel your gym membership, you might be hit with a cancelation fee. So, read the fine print to avoid extra costs.

36. Buy discounted gift cards

You don’t have to pay full price for gift cards. You can check out sites like CardPool and Raise to score gift cards at a lower price.

37. Create a spending delay

Are you dying to buy some new amazing thing that you’re convinced will change your life? Put a 48 hour hold on any big purchases. Wait to see if you’re still as pumped about it in two days. Delayed gratification can help you save money and spend less.

38. Ask for hand-me-down clothes for kids

Save money with hand-me-down clothes for your kids. Instead of buying new items every couple of months, ask friends and family if their kids have outgrown clothes or even toys. If they can pass them down to you, you’ll save big bucks.

39. Get money from recycling

Save money on your purchases and recycle them to get some cash back.

40. Don’t save your credit card info on websites

Saving your credit card info on websites can seem like a great convenience. But it can be a trap and a slippery slope to spending more. Entering in your credit card number manually every time you want to buy something can create a delay and make you think twice about spending.

41. Block tempting websites

There may be some tempting websites that entice you to spend more. You can block those websites when you’re online so you can’t access them. How? Try the Block Site website blocker for Chrome to get started.

42. Sign up for rewards programs

Do you shop at a specific place all the time? Or use a particular product or service? See if there is a loyalty or rewards program. You may be able to score free items or earn points by signing up.

43. Limit your laundry

We’re not encouraging you to wear dirty clothes, but really ask yourself how often you need to wash your clothes. Limiting laundry can save you money and may help keep your clothes in better shape, too.

44. Read instructions on special garments

Before you do laundry, read the care instructions on any special garments. You don’t want to ruin a cashmere sweater or wash something that should be dry clean only. Keeping your clothes in good shape will save you money as you won’t have to shop as frequently for new threads.

45. Shop at the dollar store

Nearly everywhere has some sort of dollar store. Check out the dollar store in your area and see if you can find deals on items you buy anyway.

46. Cut down on vices

We all have our vices. Whether you drink or smoke, eat too much sugar or drink too much soda, cut down on your vices. Vices can be expensive and bad for your health! You don’t have to give things up completely, but make an effort to cut down so you can curb your costs.

47. Do a clothing swap

Organize a clothing swap in your neighborhood. Each person brings clothes they no longer want and you can swap with other people. It’s a great way to reuse clothes and get something fresh, without spending money buying clothes.

48. Do a toy exchange

If you’re friends with other families with kids, arrange a toy exchange. There may be a toy that your child no longer uses but would be a good fit for a family nearby. Or perhaps your kids can gain new toys without you having to go out and buy them.

49. Get alerts for price-drops

Want to know when the right time to buy is? Use Price Tracker and Price Drop extension by Chrome to notify you when there’s been a price drop on a product you have your eye on.

50. Unsubscribe from sales emails

If you’re like most people, you’re getting sales emails every day. Unsubscribe from sales emails to get rid of temptation. Sometimes sales can encourage you to spend, even though you had no plans on buying anything.

How to Save Money on Your Car

51. Use GasBuddy

To save money on gas, use GasBuddy.com to see which gas stations have the most affordable prices near you.

52. Walk

If possible, save money on gas altogether by walking! Walking instead of driving is also good for your health.

53. Take public transportation

Consider taking public transportation if your destination is not in walking distance. Public transportation in your area may be more cost-effective than driving. It can help you save money on gas, parking and tolls.

54. Get your oil changed

To avoid any major mishaps with your car, it’s important to keep it in good shape. Get your oil changed on a regular basis so you can save money by avoiding much more costly mechanical issues.

55. Put air in your tires

Having the right amount of air in your tires can help your car be more gas efficient. Be sure to check the air pressure and fill up your tires as needed.

56. Clean out your car

Does your car feel like a closet and trash can in one? If so, it’s time to clean it out. First off, extra weight in your car can make your gas usage inefficient. On top of that, having a lot of items in your car can be a signal for thieves to roam through your stuff. I once left a nice-looking bag in my car and the next morning my window was bashed in and the bag was gone. I had to pay to get the window repaired.

57. Look for free parking

Parking fees can really add up. Before you head to your destination, do some research and look for free parking spots. You may be able to find free parking spots using the parking app SpotAngels.

58. Carpool

Reduce your transportation costs by carpooling. You can do this with co-workers, friends or even take a Lyft Line or Uber Pool when using a ride-sharing service.

How to Save Money on Your House or Apartment

59. Negotiate your rent

Many people think that your rent can’t be negotiated. Not true. If there’s a rental increase and you’ve been a good tenant, consider negotiating your rent. Tell your landlord why you’ve been a good tenant and explain your case. It’s expensive for apartment managers to find new tenants so don’t be afraid to attempt to negotiate your rent.

60. Limit heat/AC use

In the dead of winter and heat of summer, heat and AC costs can be brutal. So, consider only using heaters and AC when you’re home or setting the heat down a few degrees and scheduling the AC to only go on when the room temp reaches a certain degree.

61. Pay yearly instead of monthly

Some types of insurance can be more cost-effective if you pay annually instead of monthly. For example, I save money paying for my rental insurance in one annual payment.

62. Switch cell carriers

If you’re not in a contractor can get out of your current agreement, consider switching cell carriers. Sometimes cell carriers offer new customer specials so you can save money by switching.

63. Downsize

Do you have much more apartment or home than you need? Is your car way too big for your needs? Downsize! You are paying for that extra space and if you don’t need it, you can save money by downsizing.

64. Get rental insurance

Rental insurance can save you money if your apartment is damaged due to some types of disasters or burglary. It can also help you recover costs if one of your items is stolen, even if it’s not at your apartment. For example, if a laptop was stolen at a coffee shop, your renters insurance may cover the replacement cost.

65. Keep the lights off

Be mindful of your electricity use and only use the lights when you really need them. Keeping lights off more often may help reduce your electricity expenses.

66. Get a roommate

Housing can be a major cost. If you have extra space but don’t want to downsize, consider getting a roommate. A roommate can help offset some of your rent or mortgage payments.

How to Save Money on Food

67. Meal plan

Map out your meals a week in advance so you know what you’re cooking and can avoid the “What are we having for dinner tonight?” discussion and the temptations of take-out.

68. Avoid packaged foods

Packaged food may be convenient but it comes at a price. Save money by buying whole foods and not processed or packaged foods.

69. Use Ibotta

Use coupon app Ibotta to help you save money on groceries. You can get cash-back on purchases on specific food items. Just be sure to only buy things you actually need.

70. Use Groupon for restaurant deals

Want to go out to eat but not spend a fortune? Look on deal site Groupon first. You can find meal deals for a fraction of the cost.

71. Eat less meat

Meat can be more expensive than other types of foods, so to save money, limit your meat consumption. You don’t need to go full on vegan but cutting down even a little can reduce your grocery expenses.

72. Make coffee at home

Instead of a daily Starbucks run, make coffee at home. Doing so can save you $2-$5 per day, depending on the type of drink you usually get. You can even invest in coffee beans and creamer and it will still be more cost-effective than going out for coffee.

73. Host a potluck

Want to get together with friends but also save money? Host a potluck. Ask everyone to bring a different dish and enjoy many different foods, while saving money by avoiding eating out.

74. Grow herbs

You can grow some of your own herbs, spice up your cooking and save money. To start, you can buy inexpensive seeds or herb plants at Trader Joe’s or Home Depot.

75. Don’t shop hungry

The cardinal rule for grocery shopping is don’t shop hungry! You are likely to spend more because your eyes and stomach will be doing the shopping, not your brain.

76. Buy wine at Trader Joe’s

Trader Joe’s has a great affordable wine selection. You don’t have to go without good wine while trying to save money and going to TJ’s is a good savings hack. If you don’t have a Trader Joe’s in your area, try Costco. Yes, you’ll buy in bulk but the amount you’ll spend per bottle works out to be lower than a singular bottle of the same brand at a liquor store.

77. Ditch sugary drinks

Swap out your soda or frappuccino for some ice water. Ditching sugary drinks can cut down on unnecessary expenses, plus drinking more water keeps you hydrated.

78. Always have snacks

Keep a granola bar in your purse or car at all times. Having snacks on hand can help you avoid spending extra money when you’re super hungry.

Save Money on Your Pets

79. Do a pet sitting swap

Hiring pet sitters can add up fast. See if there’s a neighbor that you can do a pet sitting swap with. They will watch your pets when you’re gone and you’ll do the same when they’re gone.

80. Buy pet items in bulk

If you know you need items like cat litter or cat food, why not buy in bulk? You can score some additional savings by buying your must-have items in bulk at wholesale clubs like Costco.

81. Get regular check ups for your pets

Vet visits don’t come cheap but prevention is a great way to save money and lower costs. Getting regular check ups for your pets can keep them healthy and hopefully help you avoid major issues and expenses down the line.

Save Money on Beauty and Health

82. Get a haircut at a beauty school

You can save money on a haircut by going to a beauty school. It may take a bit longer but the savings can be significant.

83. Trim your own hair

Need just a quick trim? If you have a steady hand and good eye, consider doing it yourself. I’ve been trimming my own hair for the past two years. I just cut off the ends and it’s worked out pretty well for me.

84. Get your exercise in

Exercising can help you stay healthy and avoid additional medical costs down the line. Bonus: when you’re exercising, there’s less time to spend money.

85. Manage your stress

Stress can lead to a lot of additional expenses related to medical costs, stress-spending, stress-eating and more. So, manage your stress and this way you can keep your expenses in check.

Save Money on Entertainment

86. Cancel unused subscriptions

If there are subscriptions you don’t use anymore or ones that you don’t use often, cancel them. No need to spend money each month unnecessarily.

87. Use Goldstar for entertainment deals

You can score entertainment for a fraction of the cost using a site like Goldstar. You can buy tickets to concerts, sports games, theater shows and more at a discount. You can also find similar deals on Groupon.

88. Go to museums on free days

Many museums have free days certain times of year. Some have “by donation” days as well. So, get your museum fix by going on the free or pay-what-you-can days.

89. Borrow books from the library

Yes, buying new books on Amazon Prime can be addicting. But you can save money by borrowing books from the library for free!

90. Go to free cultural events

Many cities offer cultural activities that are free and open to the public. These can range from parades to concerts, speaker series to celebrations. Check your local community calendar to see what might be coming up.

91. Streamline entertainment

Do you have cable, Netflix, Hulu, and Prime Video? It may be time to cut back and stick with one. Having multiple streaming services and packages can add up, so cut down and streamline your entertainment.

92. Take free classes online

You don’t have to take on student loan debt or pay an arm or a leg to take some classes. You can take free classes online. You can also watch how-tos on YouTube or practice your language skills on DuoLingo.

93. Volunteer as an usher

One way to cut entertainment costs is to become an usher at a theater. Volunteer and see the show for free!

94. Volunteer to work at events

If there’s a retreat, conference, talk or festival coming to your city, inquire about volunteering. This is a great way to meet new people and save money on admission.

Save Money on Travel

95. Buy flights on Tuesday

Ready to book a flight for your next trip? Book on a Tuesday, the most affordable day to purchase a flight from the United States.

96. Stay in affordable accommodations

When traveling, accommodations can add up. Consider couchsurfing, staying in a hostel, a cheap AirBnB, or staying with a friend. Hotels can cost hundreds per night so opting for one of these options can score you some savings.

97. Avoid foreign transaction fees

Traveling abroad? You could get hit with foreign transaction fees when you spend money. Get a credit card that offers no foreign transaction fees so you can save your hard-earned dough.

98. Use Skype and WhatsApp

Traveling internationally can result in hefty call charges and international roaming. When communicating from a palazzo in Florence or the beaches of Bali, use Skype and WhatsApp to communicate for free.

99. Go camping

Looking for some peace and quiet? Go camping! It’s an affordable way to travel and can get you back to being one with nature.

100. Book holiday flights in advance

Many people make the mistake of booking holiday travel at the last-minute. That’s a big no-no if you’re trying to save money! Book far in advance, preferably no later than September for holiday travel in November and December.

101. Fly on a holiday

You can score additional savings by actually flying on a holiday. If you don’t mind this, you can save money by flying on Thanksgiving or Christmas. I’ve used this tactic to save over $100 on my flight.

Start saving now

Using these 101 savings tips, you can start to reduce your expenses in nearly all aspects of your life.

Focusing on your top expenses like housing, food and transportation can give you the biggest wins. The biggest perk: These tips can pad your savings account so you can save for your future and have money set aside for a rainy day.

 

The State of Savings in America

During the recent government shutdown, thousands of federal workers filed for unemployment. While the 35-day shutdown wasn’t the employees’ fault, it did reveal their precarious financial situations.

“It is concerning that government workers with stable employment can’t make ends meet when their next paycheck is late,” says Pauline Paquin, owner of Frugaling.

“Being financially resilient is important because charging your card or resorting to payday loans is very expensive.”

The thing is: These public servants are the rule, rather than the exception. Only 39% of Americans could cover a $1,000 emergency with money from their savings. And, 19% would have to finance an emergency on a credit card, while 17% would have to borrow the money and 13% would have to reduce spending on other things.

Here’s more on the dire state of savings in America — and how you can fight back with better financial habits and a bank that has your back.

The United States of Spending

Wondering how the U.S. is doing when it comes to saving? The numbers should tell you everything you need to know:

“We live in a society where immediate gratification is something most of us think we deserve,” explains Paquin.

“We work hard, we should treat ourselves. But we fail to see the long term effect of having everything we want right now.”

Those long-term effects can include a minor emergency causing you to lose your car, then your job, then your apartment. Or they can include never being able to retire, and forcing your children to support you in old age.

“Americans struggle to save because we aren’t taught to think about money as a tool to reach our goals,” says certified financial educational instructor Galit Tsadik.

“We think of it as only something to satisfy our immediate needs. There is also this misguided notion that you need to have a lot of money to start saving or that you need to put big chunks away in order for it to be worth it,” says Tsadik.

Three Ways to Save More Money

The truth is: You can start saving money any time, with any amount. Although it may be difficult at first, making saving a habit will pay off in the end.

Here are three expert tips to get you on the right track.

1. Change your mindset

“Keep your internal money dialogue positive, otherwise you’ve already lost,” says Tsadik.

She suggests replacing negative money thoughts like “I can’t save because I don’t make enough” with positive ones like “I’m putting this extra $5 toward my future.”

“As with anything in life, your attitude matters,” she adds.

Paquin says gamifying money can lead to mindset shifts, too.

“I like saving challenges, such as saving 1% of your income this month, then 2%, etc. — or saving all the $5 bills you come across,” she explains. “Money can be fun when you make it work for you.”

2. Track your spending

“You can’t change what you can’t see,” money saving expert Andrea Woroch points out.

“By writing down all your purchases and expenses, or inputting them into an app, you can visualize your spending habits and start the process of changing those that keep you from saving… i.e. impulse buys at Target or excessive entertainment spending.”

To do this, she suggests using an app like Mint, which tracks your purchases and alerts you when you’re overspending in a certain category. She also recommends tracking your debt repayment goals through Debt Free.

Speaking of goals, write them down.

“This gives you a sense of purpose. It allows you to set parameters, such as how much you want to save and by when, instead of trying to save with nothing to guide you. That’s when a lot of people get lost and give up,” says Woroch.

3. Start small — and automate

For Tsadik, the financial educator, successful saving is “all about paying yourself first.” She advises setting up a small weekly transfer — maybe just $10 — from your checking account to your savings account.

Wait a few weeks to see if you feel the pain. If you don’t (which I’m betting you won’t!), increase the amount. Wait a few weeks, then rinse and repeat.

“Before you know it, you will have a nice little savings cushion. And you will have gradually trained yourself to live on less and save more without feeling like you are depriving yourself of anything,” says Tsadik.

How Chime Can Help You Save

Ready to kick your savings journey into high gear? You need a bank you can trust — a bank like Chime.

Chime saves you money by, first and foremost, charging zero fees. Given that the average American pays $329 in bank fees each year, that’s a huge perk.

Beyond that, Chime also helps you save money automatically. As a Chime customer, you’ll have two accounts: one for spending and one for saving. Every time you make a purchase with your debit card, we round up the transaction to the nearest dollar — and transfer that amount from your spending to your savings account.

You can also set up automatic savings from your direct deposits, funneling up to 10% of every paycheck into your savings account. If your biweekly paycheck is $2,000, that means you’d save $5,200 in a single year. Imagine what you could use that for: an emergency cushion, a Roth IRA, or a seed fund for a house.

As Tsadik says: “Money should never be the end goal — it is what we use to get us to our end goal. When you save, you are building a financial foundation so that you can accomplish your dreams and live the life you desire!”

 

How Women Can Get the Salary They Deserve

Have you heard? Women still get paid less than men.

In fact, Economic Policy Institute reports that women earn an average of 22% less per hour than men — even when controlling for race, education, experience and location.

Although a myriad of societal and economic factors contribute to the wage gap, you have direct control over one important thing: the amount of money you ask for. According to a recent survey by Robert Half, only 46% of men and 34% of women negotiated their starting salaries. And, Glassdoor estimates that by not negotiating, the average worker leaves $7,500 — or 13.3% of their salary — on the table.

While you can’t go back in time and negotiate your starting pay, you can aim to get a raise this year. Here’s advice from three salary negotiation experts on how to get paid what you deserve.

Determine What You’re Bringing to the Table

Before asking for a raise, Kathlyn Hart, financial empowerment coach and creator of Be Brave Get Paid, says you need to figure out why you deserve one.

“You can’t just say, ‘Oh I work hard,’ because everyone works hard,” she says.

Specifically, you should ask yourself:

  • What are your job duties? How are you excelling beyond them?
  • How has your work — either by cutting costs or boosting profits — improved the company’s bottom line?

“At the end of the day, a raise can only be merited because you’re helping your company move further,” she says. “Or because you’re holding responsibilities above and beyond your current job description.”

Jacqueline Twillie, a negotiation strategist, also recommends aligning your contributions with your company’s quarterly and annual priorities.

“Get clear on how your work plays into the overall objectives. Managers really want to know that employees are buying in,” says Twillie.

Communicate With Your Boss

If you have regular meetings with your supervisor, get straight to the point — and acknowledge that you’d like a future raise or promotion, says Ashley Paré, the CEO and founder of Own Your Worth.

For example, asking your boss: “What else do you need from me…to advocate on my behalf?” will give you “clarity on where they stand in supporting you and your performance.”

Twillie agrees. “When you’re in a one-on-one with your boss, tell her about your career aspirations and find out what it will take for you to get there,” she says.

“Then level up in those areas, clearly communicating along the way that you’re expecting a promotion or raise.”

Be sure to amplify any positive feedback, too.

“Accept the compliment and share it with your direct supervisor. If you downplay your contributions, so will everyone else,” Twillie says.

Do Your Research

Once you’ve taken the necessary actions to merit a raise, it’s time to determine your target number.

Websites like Salary.com, Payscale, and Glassdoor will give you a salary range based on your industry, job title, education, and years of experience. To pinpoint where you fall, consider the amount of value you bring to the company.

“As women, we’ll naturally cut ourselves a little bit short,” says Hart.

“I always encourage [upping] your expectations a little bit. For any salary negotiation, you’re always going to start higher and come down. You don’t want to negotiate against yourself before the negotiation has even happened,” she says.

Prepare Your Case

If you’re afraid of negotiation, the best armor you have is information.

Paré suggests asking peers, mentors, and other leaders how your organization generally handles raises and promotions. If you can grab coffee with someone who recently went through the process, even better.

“The more you know up front, the less stressful the experience will be,” says Paré.

Hart advises preparing a one-pager that outlines your accomplishments and your competitive research. Twillie recommends including metrics that are important to your manager, too. (You can determine those by paying attention to what they reference in emails and meetings.)

“Negotiation is a conversation — not a battle — and the more information you’ve gathered prior to the discussion, the better-informed [case] you’ll be able to make,” says Twillie.

Practice Your Pitch

Whatever you do, don’t wing it with your ask.

“Write out exactly what you plan to say in the meeting, then practice the pitch out loud. Feeling confident is key,” says Paré.

Both Paré and Twillie suggest recording yourself on your phone, then listening to the playback and tweaking your delivery.

Hart also urges raise-seeking women to “look for ways to negotiate outside your job.” At a restaurant, for example, you could ask for a side of ranch after your server has already come to the table. Or you could ask for a slight alteration to your Starbucks order — after it has already been rung up.

She says pushing your boundaries in these small ways will help you conquer the “fear of asking for more” that nearly all of us have.

Crush Your Meeting

It’s almost showtime. To schedule a conversation with your boss, Hart suggests saying: “I want to set up a meeting to talk about my future with the company.”

Then, once you’re in the meeting, avoid diving straight into the salary talk.

Instead, Hart says you should discuss the following:

  • What you’ve accomplished over the past year
  • How much you’ve enjoyed being a part of the company
  • What you’re most proud of
  • What you’re excited to tackle next

“When a company gives you a raise, it’s not just based on your past,” explains Hart.

“It’s also on your promise for what you’re delivering in the future… [Your manager] is really looking to not only reward what you’ve done, but also show you they’re looking forward to you continuing to contribute,” she says.

Only after highlighting your accomplishments and goals should you ask something like: “Moving forward, what could my compensation look like?”

Usually, Hart says it’s better to leave the discussion open and see what your manager offers. If, however, you’re trying to justify a big leap in pay, then she suggests starting from that high number and seeing where she can meet you.

Accept Your Fears

Still nervous? That’s totally normal.

To combat your anxiety, Paré suggests identifying your biggest fear. Are you worried about “ruining” your relationship with your boss? Are you afraid you don’t deserve more?

“You’re capable of handling any outcome. So face your fear and take action anyway,” says Paré.

To push yourself, imagine how it would feel to pay 10% more on your student loans each month, or to accumulate thousands of dollars in extra savings over the next few years.

Hart also notes that, when you make an ask, you’ll nearly always be successful in some way. Even if you don’t get the raise you were looking for, you’ll gain the knowledge or confidence to land one in the future.

“If you don’t ask, the answer is always no,” she says, adding that it’s important to “be brave.”

 

Where Do Our Taxes Go? A Breakdown With the Help of Cardi B

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As the saying goes, nothing in life is certain except for death and taxes. And every year when you file your tax returns, you may be scratching your head, thinking “Where the heck does the money go?”

Cardi B wants to know, too. Last year the superstar rapper, on an Instagram video that went viral, asked, “So you know the government is taking 40% of my taxes. And Uncle Sam, I want to know what you’re doing with my… tax money.”

This is a great question, and the answer: It’s complicated. To keep things simple, here are some figures from an article at The Hill: The federal government spent $33,054 per household and collected $26,198 in taxes. What’s the budget deficit? We’re talking $6,856 per household.

Based on this $33,054 household amount, here’s where the money went:

Social Security/Medicare: $12,401. This comes out of your paycheck, and the 15.3 percent for Social Security and Medicare is divided evenly between you and your employer. Note: If you’re self-employed, you’re responsible for the entire 15.3 percent.

Anti-Poverty Programs: $6,112. This comprises assistance programs to help the less fortunate, like aid for low-income families. Some of these programs include Medicaid, Temporary Assistance for Needy Families (TANF), food stamps, housing subsidies, child care subsidies, Supplemental Security Income (SSI) and low-income tax credits.

Defense: $5,046. This is everything from military paychecks, operations in the Middle East, and the R&D and acquisition of new technologies and equipment.

Interest on the National Debt: $2,434. Just like how you pay interest fees on credit cards, mortgages and car loans, our government pays interest on the national deficit.

Veteran’s Benefits: $1,390. This includes income and health benefits provided to our veterans. 

Federal Employee Retirement Benefits: $1,098. This goes toward retirement benefits for federal employees.

Justice Administration: $546.  This is earmarked toward law-enforcement grant programs, and paying for federal attorneys and prisons.

Education: $536. While the majority of education spending comes from a city and state level, nine percent of K-12 education spending comes from the federal government. Where does the money go exactly? The lion’s share goes to low-income school districts, college student financial aid, and special education.

Health Research and Regulation: $533. This goes toward dozens of grant programs for health providers, as well as the National Institute of Health (NIH), Centers for Disease Control (CDC), and the Food and Drug Administration (FDA).

Highways and Mass Transit: $487. This is funded primarily by the 18.4 cent per gallon tax you pay on gas.

International Affairs: $371. This includes contributions to the UN, operation of American embassies abroad, and economic and military assistance to other countries.

Disaster Relief: $338. This amount provided assistance and relief to hurricanes and natural disasters.

Miscellaneous: $1,761. If you’ve been crunching the numbers, you might have noticed that there’s $1,761 still left to be spent. This remainder is distributed to federal programs that aren’t listed, such as unemployment benefits, social services, natural resources, farm subsidies, and space exploration.

Tax Filing Tips

Now that you have a basic idea of where the money paid from your federal taxes goes, how can you best prepare to file your tax return in 2019? Take a look at some of these tips:

Get Started Early. With all the changes from the Tax Cuts and Jobs Act and this historic, epic government shutdown, filing a return for the 2019 tax year might be a tad more complicated than in previous years. So, it’s important to get a jump on tax prepping as soon as you can.

If you’re going the DIY route, and using software to file on your own, gather all the required documents to file your taxes – starting with your wage and income statements (i.e. W-2s and 1099s). Have your receipts or credit card statements handy in case you need to include deductions. You can even try tracking some of your spending using a money management app.

If you’re working with a tax pro, ask her what documents you’ll need to gather to get the process rolling.

You can file your return as soon as it’s ready and this way you’ll get a refund sooner. And just think: This might be a nice boost to your savings as the average tax refund is $2,895 (this can vary by state.)

Consider Whether You Need an Extension. Need more time to file? You can ask for an extension. It gives you six more months to file, and pushes the deadline from April 15th to October 15th. Remember: Receiving an extension means you have more time to file, but payment for any taxes owed are still due by April 15th.

The More You Know

So there you have it. Both you and Cardi B now have a clear idea as to where those government tax dollars are going. It’s now your turn to file your tax return!

 

How to Be Prepared for a Market Downturn in 2019

If you had money invested in the stock market in 2018, you may be feeling a tad bit of anxiety. Well, maybe a whole lot of anxiety. That’s because last year was the worst year for stocks in a decade, with the S&P 500 down 6.2%, the Dow falling 5.6%, and the Nasdaq dropping four percent. Yikes.

As we move into 2019, you may be wondering if the stock market will continue to decline or whether it will rise. While no one has a crystal ball to see into the future, some financial experts believe a period of slowed economic growth is headed our way, according to Investor’s Business Daily. So, what can you do to prepare for a potential market downturn in 2019?

There are many steps you can take to protect your finances and stay ahead in the event that we head into a period of financial decline. Take a look at these four tips from financial experts:

1. Set expectations for your money

First things first: Figure out your money goals. For example, if you need cash for short-term goals, like living expenses and paying off debts, this money should ideally be held in an emergency fund or another savings account that isn’t subject to stock market fluctuations, says Ellen Duffy, CFP and owner of Parkway Wealth Management in Boston. Parkway’s services are provided through Aevitas Wealth Management, Inc., a registered investment advisor.

According to Duffy, you should keep three to six months worth of expenses in an emergency fund. This way the cash is available if you should need it for any unforeseen reason, like a job layoff or major car repairs.

Also, consider life cycle changes happening in your life now or in the near future. For example, are you expecting a baby, planning to buy a home or considering leaving your job to start a business? If these or other life changes are on your horizon, you’ll want to beef up your cash reserves – regardless of which direction the stock market goes.

“Understanding that you have ample cash on hand can a great tool for being patient during periods of market fluctuation,” says Duffy.

2. Understand that market fluctuation is part of investing

Here’s a fact: Market declines are part of investing.

“They occur regularly and are difficult to predict,” says Duffy.

So, why do we feel nervous and emotional when the stock market declines?

“Because we are human! It is natural to feel uneasy during periods of market volatility,” she says.

But, here’s the good news: Declines don’t last forever and generally speaking – while past performance does not predict the future – markets do go up over long periods of time  – “they just don’t go up in a straight line,” says Duffy.

The best thing you can do if you’re worried about the volatility of the stock market is to educate yourself on the fluctuations over time, prepare for this and ride it out. Remember: What goes down, will come back up.

According to Fidelity, it’s impossible to predict when the good and bad days will happen. If you miss even a few of the best days, it can have a lingering effect on your portfolio. For this reason, it’s best to stay the course. 

Adds Duffy, “try to avoid making emotional decisions or trying to time the market – both actions can be harmful to investment performance.”

Here’s another tip: A market decline can be a good time to add to your investments – that is, if you have ample cash on hand, are prepared to invest long-term, and can handle potential volatility. Think of this like getting a great deal on a vacation or new car.

“People love to buy clothes, cars, airline tickets etc. when they are available at a reduced price… yet this premise often doesn’t translate to some investors,” says Duffy.

When stock prices fall, this may benefit you as you may be able to buy more shares or spend less money per share. Case in point: The worst times to jump into the market may actually turn out to be the best. For example, the best 5-year return in the U.S. stock market began in May 1932—in the midst of the Great Depression, according to Fidelity.

3. Don’t put all your eggs in one basket

Ok, this may seem cliche but this major premise in investing is also called “diversification.”

“Downside risk and performance can be amplified if you are invested in a single asset class or single stock – also referred to as ‘concentrated position risk’,” says Duffy.

Instead, you should consider investing in multiple asset classes, including: large cap stocks,  growth or value stocks, and small cap stocks. You may also want to consider investing in international stocks, emerging markets, commodities, real estate, and multiple categories of fixed income securities.

“Each asset class has its own attributes and over time may outperform or underperform for any given period ..and no one particular asset class has been the top performer year over year.”

If this information seems too high-brow, let’s boil it down this way: Diversifying, or spreading your investments across various asset classes, may help lower the fluctuation in your portfolio. To create a diversified portfolio, it’s important that you also understand your risk tolerance, as well as your timeline and goals for investing.

4. Save money automatically

Regardless of whether you have a lot, a little or no money in the stock market, it’s important that you save money. This can help you during a time of financial uncertainty (see #1). It can also help you reach your financial goals regardless of whether the market goes up or down.

A good way to stash away more money is to automate your savings. If you open a no-fee Chime Bank account, you can start saving more money right away. How? You’ll get a Chime Visa Debit card and every time you use your card, Chime will round up your transaction to the nearest dollar and deposit that change into your Chime Savings Account. Those pennies add up – fast. For example, if you use your Chime card twice a day on average, you’ll save more than $300 a year – without even thinking about it.

Stay the course

We get it: A potential stock market downturn may cause you to feel stressed out. But, if you use the four tips above, you’ll be more apt to weather a financial storm.

With that in mind, here’s a final pro tip: If you want or need more expertise on how to best manage your money, it’s a wise idea to seek help from an investment professional or financial advisor. This way you’ll have an expert who can help guide you through market ups and downs, as well as help hold you accountable to your money goals.

 

How to Invest Small Amounts of Money

When you think of investing, you might think of wealthy finance types or people straight out of The Wolf of Wall Street.

But, in reality, everyone can invest for the future, and you don’t have to have a ton of money to do so. We’ve scoured the web for some great resources and found these 10 best ways to invest small amounts of money. Read on to learn more.

1. Invest with a robo-advisor: $10

If you’re not sure how to start investing, try a robo-advisor. A robo-advisor is an online investing platform that can help manage your money.

For example, you can try investing with Betterment, one of the bigger robo-advisors out there. There is a minimum deposit of $10 and the annual fee is 0.25 percent. Other fees are based on your account balance.

When you get started, Betterment will ask you what you’re investing for — such as retirement or a down payment on a house. After that, based on your goals and risk tolerance, Betterment will create a custom portfolio for you. You can get started at Betterment.com.

2. Invest your spare change: $0.01+

When you make a purchase, it can feel like your spare change isn’t that important. But we know that small amounts of money can add up fast. That’s why Chime offers a round up savings program.

Applying this same philosophy to investing, you can invest your spare change with Acorns, a micro-investing platform that takes your change and builds a portfolio for you. And, investing your spare change with Acorns will only cost you one dollar per month.

Through Acorns, you invest with exchange-traded funds and the company will build a portfolio based on your financial goals.

3. Invest in certificate of deposits (CDs): $0-1,000

One way to invest small amounts of money with not-so-much risk is through certificates of deposit (CDs). According to Investor.gov, “A certificate of deposit (CD) is a savings account that holds a fixed amount of money for a fixed period of time, such as six months, one year, or five years, and in exchange, the issuing bank pays interest. When you cash in or redeem your CD, you receive the money you originally invested plus any interest. Certificates of deposit are considered to be one of the safest savings options.”

You can typically get certificates of deposit from a bank or financial institution. The minimum investment may vary but could be between $0-$1,000. Though CDs are considered safer and less risky, it also means they don’t have as high returns as other investment vehicles.

4. Invest with Prosper: $25+

Online loan marketplaces bring borrowers and lenders together. One such marketplace is Prosper. Through Prosper, you can invest $25 as a minimum per loan. These personal loans are offered to creditworthy borrowers and you can earn around 5.4 percent, according to the historical average. The best part is that you can get your earnings deposited into your account each month. While this comes with a moderate level of risk, it may not be as volatile as the stock market. Get started on Prosper.com.

5. Invest in social good: $50

What if you could invest money to support causes you care about? Well, you can do this through impact investing. Impact investing, aka socially responsible investing, allows investors to support causes like green energy, clean water, gender equality and more.

Using Swell Investing, you can begin growing your money and supporting causes you love with an initial deposit of $50. There’s a 0.75 percent annual fee and there are no trading fees or expense ratios. While there is risk with any type of investing, at least this way you know your money is supporting something you care about.

6. Invest based on themes: $250

Investing can be confusing, but it becomes simpler when you focus on a specific theme that you care about. Motif Investing offers you a way to invest in specific thematic portfolios such as technology or sports. You do need a bit more money than some of the other options here, with an initial investment of $250.

Once you select a theme, Motif builds a custom thematic portfolio. Find out more information on Motif.com.

7. Invest in fractional shares: $5

Investing doesn’t have to cost a lot of money! That’s certainly true with Stockpile, where you can start investing with just five dollars. You can buy fractional shares of stocks and exchange-traded funds. There are no fees or minimums and it’s 99 cents per trade. There are also mini-lessons, so you can learn as you go instead of waiting to invest when you have everything figured out. Get started at Stockpile.com.

8. Invest in low-cost index funds: no minimum

Low-cost index funds are Warren Buffett’s secret weapon. Index funds track different securities on an index, like the S&P 500.

Index funds can have lower costs and can offer more diversification. While investing in the stock market can be risky, diversification of index funds can help manage risk. Fidelity, for example, offers the ability to invest in index funds with no minimums and no account fees.

You can get started with Fidelity or Vanguard.

9. Invest in your retirement with a IRA: no minimum

You may or may not have a 401(k) with your employer. But anyone can invest for their retirement with a Traditional IRA or Roth IRA (Individual Retirement Account).

Using a brokerage firm, you can set up a retirement account and begin investing in your retirement immediately.

As of 2019, the contribution limit for IRAs is $6,000 per year. While the main tax difference is paying taxes now (Roth) or paying later (Traditional), there are income limits with a Roth IRA. To invest the full amount in a Roth IRA, your income must be less than $122,000 for single filers.

10. Invest in a 529 College Savings Plan: $25

If you have children, you can invest in a 529 College Savings Plan to help save for their education. Using an app like U-Nest, you can open an account with just $25. U-Nest costs three dollars a month and takes five minutes to set up on your phone. You can get started at U-nest.com.

Additional resources: How to invest small amounts of money

Using these 10 ways to invest small amounts of money, you can start growing your money today. Here are some additional resources you may want to check out:

  • Fidelity:  Fidelity is a brokerage offering various investment products and education resources.
  • Vanguard: Vanguard is another brokerage offering varying products and education material.
 

How Chime Offers No Hidden Fee Checking Accounts

You’ve probably heard the adage Nothing in Life is Free. Well, we’re here to debunk this. Did you know that you can get a free Chime checking account with no hidden fees?

Chime is a mobile-only bank account that helps you save money automatically and manage your finances from anywhere. Now one of the fastest growing bank accounts in the U.S., Chime offers members a Spending Account, an optional Savings Account, and a Chime Visa® Debit Card. Rated the “Best Free Checking Account of 2018” by NerdWallet, Chime is on a mission to eliminate bank fees while empowering you to take control of your finances and save money.

Those pesky fees add up – fast. Did you know that the average U.S. household pays over $329 in bank fees annually, and that most Americans haven’t switched to a checking account with no fees? Pretty remarkable, right? If you’re ready to make the switch and kiss those fees goodbye forever, take a look at 5 reasons why Chime offers a no fee checking account, and how you can benefit.

1. Chime is committed to helping you get ahead financially

When you have to pay monthly fees just for having a checking account, this doesn’t help you pocket your hard-earned cash. Instead, banks profit off of you and Chime would rather profit with you. So, instead of charging you fees – like most traditional banks – Chime has turned the banking industry on its head. It makes no money off your no fee Spending Account, allowing you to keep all of your cash. How does Chime make money? Good question. Here’s the answer: Every time you use your debit card, Chime earns a small amount from Visa (paid by the merchant.)

2. Chime offers an awesome banking alternative to big banks

Did you know that the five largest banks in the U.S made more than $34 billion in overdraft fees alone in 2017? Chime, along with other challenger banks, want to change this with no fee checking accounts and debit cards that empower you to save money. Yet, regardless of where you bank, here’s a tip from Chime: Be sure to learn about any fees you may have to pay, including overdraft fees, savings account fees, account maintenance fees, foreign transaction fees, and more. And if you want a bank that will never rely on unfair bank fees for profit, Chime is here for you.

3. Chime offers a Spending Account that suits your lifestyle

With a Chime no fee checking account, you can do all of your banking right from the modern and intuitive mobile app. This includes depositing checks on the go, paying friends, transferring funds, paying bills and even mailing checks. Here’s how these main features work:

  • Mobile Check Deposit

To deposit a check, all you need to do is snap a quick photo with Chime’s mobile banking app, and then sit back and watch your account balance grow. No need to fill out a deposit slip, go to a brick-and-mortar bank or ATM, wait in a bank teller line, and write out a paper check and put it in the mail. You can deposit checks from anywhere in the world. Easy peasy.

  • Pay Friends

With a Chime Spending Account, you can send money instantly to friends and family, even to those that aren’t yet Chime members! Using the Pay Friends feature, you can divide up rent payments or split the bill when out to dinner with friends. And, you’ll never pay fees.

  • Automatic Savings

Now that you love your Spending Account, it’s time to automatically grow your savings with the Save When I Get Paid or Save When I Spend features. Automatically save 10% of your paycheck into your Chime Saving Account with Save When I Get Paid. You can also automatically round-up your purchases and save the different into your Savings Account with Save When I Spend.

  • Pay Bills Electronically

Using Chime’s bill pay feature, you can pay your bills, track your expenses, and keep tabs on your balance from the mobile app on any device. You can even leave your wallet at home when you go shopping as Chime supports mobile payment apps like Apple Pay, Google Pay, and Samsung Pay.

  • Mail a Check

We know mailing checks is old school. But, sometimes you gotta do it and Chime makes this task simple. It even puts the check in the mail for you. That’s right. If you have to mail a check, you can do this through the mobile app. All you have to do is let Chime know who to send a check to and for how much. Chime will then make sure your check gets to where it needs to be. Now this is what we call the best kind of virtual personal assistant.

4. Chime offers easy access to your money

While Chime is a mobile-only bank with no brick-and-mortar locations, this doesn’t mean you’re limited when it comes to ATMs. In fact, just the opposite is true. You can use your debit card to withdraw money from your no fee checking account at over 38,000 fee-free ATMs. In addition, you can use 30,000 plus cash-back locations.

Chime is part of the MoneyPass® and Visa Plus Alliance ATM networks, with locations throughout the United States. You can use the mobile app to find an in-network free ATM and then use your debit card to withdraw cash without fees. Now that’s convenience to the max.

5. Chime helps you save automatically

Now that we’ve explained Chime’s mission to help you save money with no fee bank accounts, it’s time to break down some of the key ways in which you can keep more of your money, while boosting your savings. And, remember, these money-saving features from Chime cost you nothing in fees and will help you save money without even thinking about it. Take a look:

  • Save When I Spend

    With Chime, you can save money every time you make a purchase or pay a bill with your Chime debit card. The Save When I Spend feature automatically rounds up your transactions to the nearest dollar and transfers the round-up from your Spending Account into your Savings Account.

  •  Save When I Get Paid

     This automatic savings feature allows you to save money with every paycheck. This way you can reach your financial goals faster. If you’re a Chime member, you can automatically transfer 10% of every paycheck directly into your Savings Account.

  • Get paid up to two days early with early direct deposit 

    Getting your paycheck early means you’ll have two more days to do more with your money. When you open a no fee checking account with Chime, you can set up direct deposit two ways: you can request an email with a pre-filled direct deposit form that you can give to your employer, or set it up yourself using the Account and Routing numbers listed in your Chime app. No waiting for your money while it sits in some mysterious electronic limbo, and no more worrying about lost paper checks. You’ll get your cash two days before most other traditional banks make the funds available to you. The waiting game is over!

Are you ready to open a no fee checking account?

If you’re currently paying bank fees, this means you are paying your bank for the right to hold onto your money. Ridiculous, right?

Yet, you have a choice. You can switch to a no fee bank account. Signing up for a Chime account takes less than two minutes and there is no minimum balance required to open a no fee checking account. What are you waiting for?

 

The Psychology of Savings – Why It’s So Hard and 5 Things We Can Do About It

Nearly one-third of Americans (31%) have less than $5,000 saved for retirement.

Nearly half (40%) couldn’t cover a $400 emergency without borrowing money or selling something.

Since you’ve probably heard stats like this before, you may already know we humans are terrible at saving money. Why, though? For starters, there are a myriad of societal and economical factors like low wages, higher costs of living, insane student loans, and so on. But, what’s the real root cause of our inability to save? And how can we combat our natural tendencies to finally start investing in our future?

Here’s what psychology says — and how you can use it to get ahead with your own finances.

Why We’re So Bad at Saving Money

It all goes back to when we were living in tribes, according to Ted Klontz, a financial psychologist and professor at Creighton University.

Since tribes operated communally, keeping something you didn’t currently need made you look selfish — and could eventually get you kicked out. Which meant you didn’t pass on your DNA. Similarly, if you saved your food from one day to the next, you could get sick and die. Which, again, meant you didn’t pass on your DNA.

Even 100 years ago, humans were more communal, with several generations pooling resources under the same roof. We also only lived into our 40s, meaning we didn’t need to worry about surviving multiple decades without working.

While Klontz notes a small portion of humans — between 14% and 17% — are natural savers, it’s plain to see why the rest of us simply aren’t wired that way.

How Traditional Financial Institutions Exploit Us

Traditional banks and credit card companies are well aware of the statistics. In fact, their business models thrive on that knowledge.

Klontz says credit cards, in particular, have created an “artificial bottom.” When older generations didn’t have any money, they couldn’t buy anything. But today, you can put it on plastic. And when you do, the issuing bank will charge you an interest rate — often as high as 22%.

“They’re making money off you spending more than you have,” Klontz says.

Financial institutions also charge exorbitant fees for making small mistakes, essentially profiting off your sheer human-ness.

Although no-fee banks do exist, Chime’s Bank Fee Finder found the average American household pays $329 in bank fees annually. In 2016, the big banks earned $33 billion in overdraft fees alone.

Five Ways to Finally Start Saving Money

Ready to combat both your brain and the big banks to finally start saving?

Before you do that, you should know that your subconscious brain makes 90% of your decisions without you realizing it, according to Klontz. And that part of the brain, he says, hasn’t “received a programming update for 100,000 years.”

So, to bypass your subconscious brain, you’ll need to speak its language. It won’t respond to logic or equations or charts; it’ll only respond to fear and pleasure. That’s right: You literally need to scare or excite your subconscious brain into submission.

Here are five ways to do so.

1. Use all five of your senses

Did your third-grade teacher hang a goal chart in your classroom? Maybe it was a “good behavior thermometer.” When you reached the top, you had a pizza party. Or maybe it was a poster that showed how close you were to reaching your reading goals.

As it turns out, those visual depictions are very effective.

“Your subconscious brain doesn’t get abstract concepts,” explains Klontz. “It’s very literal — like a 6 or 7 year old.”

Translation? “Any work to change the subconscious has to be sensory. It has to go beyond words,” he says.

So, if you’re saving for a trip to Peru, you could sketch a picture of Machu Picchu. You could listen to some Peruvian flutes. You could visit a local ceviche restaurant. You could tell your co-workers the myriad reasons you’re dying to visit.

The more you can see, touch, hear, smell, and taste your goal, the more likely you are to pursue it, says Klontz. That’s because each new sensory experience reminds your subconscious why you’re saving money in the first place.

2. Scare yourself

While retirement might seem far away, the sooner you start saving, the better off you’ll be.

To spur yourself into action, think about what would happen if you don’t save a dime. Picture the worst-case scenario for the last three weeks of your life. Where are you? Who’s there (and who’s not)? What does it smell like?

It’s probably not pretty. And by imagining it, you’ll stimulate your subconscious brain into changing its behavior — especially if you also picture the decisions that led you there.

Taking it a step further, Klontz recommends using age progression software like the free AgingBooth app (iOS / Android).

“When you take a 30- or 40-year-old person and show them what they’re going to look like at 70 or 80, their savings rate increases dramatically — up to 200%,” he explains.

3. Automate your savings

Another way to trick your brain is to, well, not really involve it all. By turning your savings on auto-pilot, you’ll relieve your subconscious brain of its decision-making duties.

“If you don’t see it, you don’t feel it,” says Kathleen Burns Kingsbury, a wealth psychology expert and author of Breaking Money Silence.

Research, for example, shows that when employers automatically enroll their workers in retirement plans — forcing them to opt out, rather than sign up — it significantly boosts participation rates.

We’ve found this with Chime customers, too. People who enrolled in both of our automatic savings programs save an average of 240% more than those who aren’t enrolled in either.

4. Find a buddy

Whether you’re trying to quit smoking, exercise more, or save money, accountability is a key factor in behavior change.

Kingsbury suggests finding a friend who is also trying to build better financial habits, and then challenging her to a saving contest. Whoever saves the most by the end of a certain period will be crowned the winner. This strategy transforms society’s current definition of “winning” (flashy car, bigger house) into a more fiscally responsible one (saving more money).

Experts also say the most effective rewards are intrinsic: Enjoying the feeling of saving money, for example, rather than rewarding yourself with something tangible.

5. Put your values on the line

Name an organization you truly loathe. Perhaps it’s the campaign fund for a politician you oppose, or an advocacy group for a cause you disagree with.

Whichever organization it is, sit down and write a $100 check to it. Then give that check to a trusted friend. Tell him if you don’t save, say, 10% of your paycheck this month, he has your permission to mail it. (If you don’t have a checkbook, you can use an app like stickK.)

Since Klontz says negative emotions have “twice the motivating effect” as positive ones, this “anti-charity” technique can be powerful.

Today’s the Best Day to Start Saving

While you can blame your struggles to save on your internal software, you can’t use your brain as an excuse forever.

It’s never too late for a fresh start, so use the tips above to circumnavigate your subconscious — and set yourself up for future financial success.

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