Tag: Money Moves

 

Here’s What a Documentary About FIRE Taught Me About Money

What do you think of when you think of retirement? Sleeping in? Sipping drinks on the beach? 

Until recently, almost every retired person I knew was over 65 years old. I’ve met a few people who managed to retire early – in their late 50’s or early 60’s – but they are the rare exception. The rule I had learned from an early age was that if you work hard, save money, and spend 40 years in the workforce, you can retire. 

That’s why, when I first heard about the FIRE movement, I was confused. FIRE, which is short for Financial Independence Retire Early, continues to gain momentum. In fact, there’s even a new documentary called Playing with FIRE, which chronicles one family’s quest to reach early retirement. 

Playing with FIRE follows 35-year-old Scott Rieckens, his wife Taylor, and their toddler Jovie. I watched this movie as a skeptic (I mean, how can they really retire?) But, by the end, I was re-thinking some of my own financial decisions.  

Here is what this movie taught me about money:

Question your biggest three expenses

Americans spend the majority of their income on housing, transportation, and food. That’s really not surprising — we need somewhere to sleep, we have to eat, and we need a way to get to work. But, I’ve always considered these expenses to be out of my control. I thought I needed to spend money on housing, food and transportation. That meant I’d have to save money on the less impactful areas of my life – things like cutting out that latte and avoiding excessive shopping.

Yet, Playing with FIRE showcases people who have reached financial independence by deciding to live differently than the norm. The highlighted family, in fact, ditched buying a home to travel the world instead. They proved that changing one of your major fixed costs can make a huge impact on your financial situation. 

Are you spending on what makes you happy?

Early in the movie, Scott and Taylor had just discovered the idea of FIRE, and they were decades away from retiring. Their monthly expenses in the big three were high: They lived in a beach community, spent $2,000 per month on food, and each drove a nice car. 

Before they changed any of their spending, they did a simple exercise. They each separately made a list of the things that made them happy on a weekly basis. 

This was Scott and Taylor’s first epiphany: Most of the things on their list didn’t cost any money. Neither of them mentioned the beach, driving their cars, or going out to pricey sushi dinners on their happiness list. Why were they spending so much each month on things that didn’t really make them happy? 

Viewing your money choices through the lens of what makes you happiest makes perfect sense. A quote from The Minimalists in this movie really drove this idea home: “We spend money we don’t have to buy things we don’t need to impress people we don’t like.”

Small changes can buy back years of your life

Understanding how current spending choices can impact your future financial situation is difficult. How often do you weigh the cost of going out to dinner, buying a new jacket, or driving a certain car against how much longer you need to work? 

Like many people, Scott and Taylor struggled to see how the choices they were making now could impact their future life. At one point, they sit down with a financial calculator and determine what would happen if they ditched one of their luxury car payments. Technically, they could afford the monthly car payments. However, by forgoing that cost, they could shave five years off their working lives.

Your savings rate holds the key to financial independence

The movie lays out some startling facts: 34% of Americans have no savings and 78% live paycheck to paycheck. It’s clear we could all use a lesson in saving more money.

But how to do this? The folks in the FIRE community focus on your savings rate as a simple way to understand how many years you’ll need to work before you retire. 

To calculate your savings rate, take the amount you save and divide it by your income. For example, if you earn $4,000 per month and save $300, your savings rate is 7.5%. 

According to calculations in the movie:

If you save five percent of your income, it will take you 62 years of work to reach retirement

If you save 10% of your income, it will take you 51 years to reach retirement

If you save 20% of your income, it will take you 37 years to reach retirement

If you save 50% of your income, it will take you 17 years to reach retirement

For your savings rate to change, you either need to earn more, spend less, or do both. In Scott and Taylor’s case, they start out with an eight percent savings rate. By the time the movie ends, they’ve made enough changes to their spending to achieve a 50% (or more) savings rate.

This isn’t about money

FIRE isn’t really about money. It’s not even really about retirement. What I failed to understand before watching the movie is that FIRE is about having the ability to make choices in your life. 

The movie asks you to imagine what it would feel like if you didn’t live paycheck to paycheck. Imagine if you were debt-free, or if you had a full year’s worth of expenses saved. How would that financial freedom change the decisions you make?

Even if you don’t want to retire early, you can probably get behind the idea of financial freedom. Wouldn’t it be nice to breathe just a little easier between paychecks, change careers if you want, and not panic if lost your job? That’s the freedom that FIRE creates. 

Perhaps the thing that struck me most about the movie was this piece of wisdom: “It’s not about having all the money in the world. It’s about doing the best that you can with the money that you do have.”

This inspired me to think about how the financial choices I make today can impact my freedom tomorrow. 

 

Recommended Budget Category Percentages

We all know how beneficial a budget can be. 

For starters: A budget outlines your spending plan so you know exactly how much money goes toward each expense. Budgets are also extremely helpful when trying to decide how much you have available to save and how much money you can put toward paying off your debt. 

At the same time, there are many different ways to budget. One of the most common budgeting strategies I recommend is to set up budget category percentages. For example, a common rule of thumb is that housing costs shouldn’t exceed 30% of your income. What about the rest of your budget categories? Luckily, they can be broken down by percentages as well. 

Read on to learn more about creating percentage categories for your budget. 

Start with the Basics

If you’re new to budgeting, using the 50/30/20 approach is a great starting point. 

With the 50/30/20 budget, you allocate 50% of your income toward living expenses and necessities, 30% toward wants, and 20% toward debt and savings. 

Here’s how this would look. Say you bring home $3,000 each month. Under the 50/30/20 budgeting method, you’d put $1,500 toward living expenses and necessities, $900 to wants and variable expenses, and $600 toward debt and savings. 

While this method is super easy to use, it may not fit in with your particular goals. For example, you may want more wiggle room for your savings account

Get a Little More Specific

If you want to venture beyond the 50/30/20 budgeting method, you can get more specific and add additional percentages while breaking up your spending into more categories. 

Think about your goals and lifestyle. What do you value spending money on? How much are your core necessities? Do you have debt? What are your savings goals? 

Start tracking your spending to see what your current budget categories are. It can be eye-opening to see the percentage of your income that you spend on things like dining out, transportation, and even bills and insurance. 

So, think about setting your own budget percentages based on your preferred spending patterns and goals. With that in mind, here are our recommended budget category percentages that can help you get ahead. 

Basic Recommended Budget Category Percentages

Housing (mortgage and rent costs): 25% 

Utilities: 5%

Food: 10%

Transportation: 5%

Insurance (includes medical, auto, renter’s etc.): 15%

Personal (+ household expenses): 5%

Entertainment/Recreation: 10%

Charitable Giving: 10%

Savings/Debt: 15%

Here’s how this budget would break down if you bring home $3,000 each month:

Housing (mortgage and rent costs): $750

Utilities: $150

Food: $300

Transportation: $150

Insurance (includes medical, auto, renter’s etc.): $450

Personal (+ household expenses): $150

Entertainment/Recreation: $300

Charitable Giving: $300

Savings/Debt: $450

Keep in mind that these are pretty standard budget percentages if you want to have enough money to afford your needs and wants. As you can see from the example above, you still can’t afford to splurge on housing costs, but you’ll have plenty of money for groceries, dining out, giving, savings, and debt payments. 

Once you have your ideal budget in place, you can start allocating money to different expenses when you get paid

Aggressive Recommended Budget Category Percentages

While the basic recommended budget category percentages may work well, you may want to take it up a notch if you have some aggressive savings goals and are willing to live frugally. 

If you are looking to pay off debt quickly or save to meet an important goal, here are some budget category percentages you can try.

Housing (mortgage and rent costs): 20% 

Utilities: 5%

Food: 7%

Transportation: 3%

Insurance (includes medical, auto, renter’s etc.): 10%

Personal (+ household expenses): 5%

Entertainment/Recreation: 5%

Charitable Giving: 5-10%

Savings/Debt: 40%

Here’s how this budget would break down if you bring home $3,000 each month:

Housing: $600

For this amount, you’d likely have a roommate or rent a smaller apartment to keep housing costs low. If you own a home, you may also rent out a few rooms to offset your mortgage costs. 

Utilities: $150

If you have roommates, you can split the cost of utilities to save money. Perhaps you can use Chime’s Pay Friends to send fee-free mobile payments if you’re splitting bills. You can also limit your use of electricity during the day by turning off lights as well as reducing heating and cooling costs by using a programmable thermostat.

Food: $210

Although the amount is quite low, this may be enough for one or two people. If you cook most meals at home, take advantage of sales, and buy ingredients and whole foods instead of packaged food, you can make this budget work. 

Transportation: $90

While this amount is also low, perhaps you work close to home and can keep your fuel costs down. Or, maybe you can use alternative transportation like walking or cycling. 

Insurance: $300

For this amount, you likely shop around for the best insurance rates and drive an older car that doesn’t cost much to insure. You also receive benefits from your job which helps keep this category low.

Personal (+ household expenses): $150

This amount is just enough to buy basic needs and supplies for the house as well as some affordable personal care once or twice a month. 

Entertainment/Recreation: $150

Your dollars can be stretched with free local activities and experiences along with using coupons and deal sites to dine out. 

Charitable Giving: $150-$300

Although you’re determined to save and/or pay off more debt, this budget still allows for you give back to others in need. 

Savings/Debt: $1,200

Accelerated debt payments and savings contributions will allow you to hit your financial goals faster, even if you don’t have a large income. 

The Power of Budgeting

It’s quite possible to save more than $14,000 annually on a $40,000 salary with the aggressive recommended budget percentages above. 

Yet, regardless of whether you prefer an aggressive, basic or other type of budget, breaking up your spending categories by percentages is powerful. It shows you exactly where your money is going and how much of your income is used for certain expenses.  

Feel free to use this new perspective and play around with your own budget category percentages. This will help you determine where you spend and how much you can save. Are you ready to give it a try?

 

Career Moves for the Summer Slowdown

If you’re skipping a summer getaway this year because you’re trying to save money, don’t feel bad about it. It could actually be a good thing if you’re hoping to get ahead at the office. 

In fact, summertime can be an ideal opportunity to do some strategic career planning. For example, perhaps you can use this time to map out your next moves at your current job. Or, perhaps you can begin strategizing about your next career move. 

If you’ve got some time on your hands this summer, here are four ways to potentially brighten your career prospects by the fall. 

1. Volunteer for Extra Tasks

Your colleagues may be taking time off and leaving part of their workload unfinished. That’s a chance to step up and pick up some of the load – and perhaps get the attention of higher-ups. 

“Taking on extra work and doing a great job of it can be an effective way to impress your boss,” says Chris Chancey, career expert and owner of Amplio Recruiting

Chancey says not to think of this as picking up the slack for your coworkers. Instead, “see it as an opportunity to demonstrate leadership, showcase skills and strengths your supervisor and teammates probably did not know about.”

Just be sure that taking on extra work doesn’t compromise your ability to manage your regular workload. 

Jason Patel, founder of college and career prep company Transizion, says to prioritize the kinds of tasks you offer to take on to focus on high ROI activities. Also, review your work schedule so you know what you can really do.

“This will help you discern how much extra work you can take on. Knowing how much you should help a coworker will save you from burnout,” Patel says.

2. Grow Your Network

Your network can be an invaluable tool for moving up the career ladder, so consider expanding your connections this summer. 

“Summer is a great time to get out of the office and socialize,” says Laurie Berenson, founder of Sterling Career Concepts

Some ways to connect? “Meet people for lunch or happy hour, reconnect with former colleagues, reach out to people with whom you’ve worked on projects in the past but haven’t seen lately,” Berenson says. 

Those kinds of activities can reinforce your existing relationships. If you want to add people to your network, Chancey says to expand your scope. He suggests taking up a group hobby or attending Meetup events to meet new people who may share similar career backgrounds or professional interests. 

You can also broaden your network online through LinkedIn and other professional networking sites. 

“You probably have a little more time in the summer so why not take this opportunity to send out personalized invitations to connect with people whose role you admire and aspire to,” Chancey says.

“This is also a great time to reach out to some of your existing contacts and see what they are up to. On LinkedIn, you can write them a recommendation or endorse their skills.”

3. Learn Some New Skills

Knowledge is key for career advancement so consider initiating your own version of summer school. For instance, take a class, attend a workshop or seminar, volunteer, read some useful books or listen to some motivating podcasts. 

“Summer is a great time to take a course,” Berenson says. “If your company offers internal training, look at what’s offered or find out if you can be reimbursed for third party courses.”

Focus on filling in any knowledge gaps you might have that could help you shine at work or potentially help you land another job down the line. 

This is where having a mentor can be invaluable. 

“What works for everyone interested in professional growth is getting mentored by an industry expert, either online or in person,” says Maciej Duszyński, a career expert at ResumeLab

“Why? Because industry experts can get you up to speed in a heartbeat.”

4. Start Planning Now for a Job Search

Setting clear goals for what you want to do career-wise can help you get clarity on how to achieve them if your plans involve changing companies. 

“Define your career goals for the fall and begin mapping out your next ideal move over the summer,” says Jeanna McGinnis, professional career coach and director of client triumph for Mentor Happy

“By planning now, you’ll have a better understanding of what you’ll need to accomplish prior to beginning a job search in the fall.”

McGinnis says that in addition to setting goals, you should focus on some tangible tasks. That includes updating your resume and LinkedIn profile.

You can also research for salaries, which can help you potentially earn more money if you’re offered a new position. And, you can practice your interviewing skills and elevator pitch over the summer so that they’re fine-tuned when it’s time to use them. 

Stay on Your Toes at Work this Summer

One last tip for making forward moves on the job this summer: Maintain your professional image at work.

Just because everyone is slacking does not mean you should come to work late and sneak out early or show up in beach attire,” Chancey says.

“While you should enjoy the cheer, do not let your guard down too much such that you ruin your reputation, especially in the eyes of your boss.” 

That’s good advice! While we want you to enjoy the summer heat, keeping it cool at work can help you get paid what you’re worth if you’re angling for a raise or promotion. 

 

How to Turn Your Side Hustle into a Full-time Gig

Fifty percent of millennials have a side gig, according to a study by Experian.

This is often the perfect way to jumpstart your financial goals, including debt freedom, moving into your own apartment, or funding that dream vacation. A side hustle can also be a big motivator to launching a full-time business and achieving financial freedom.

To help you learn more, take a look at seven tips to turn your side hustle into a full-time gig.

1. Be Realistic

The truth is: Not every side job can be turned into a full-time hustle. For example, mowing your neighbors’ lawns every weekend probably works really well as a side gig, generating a few hundred dollars a month. But you would need to put in a lot more effort to transform this concept into a full-fledged business. For example, you’d need to consider advertising costs, the seasonality of a lawncare business, and the existing competition in the market.

Putting together a financial forecast to determine your total revenues and expenses is another important part of your research at this stage.

2. Stop Treating Your Side Business Like a Hobby

Leah Gervais, founder of Urban 20 Something, says that if you want to scale your side hustle into a full-time gig, you need to treat your side business “like your job, because it is.”

“This means scheduling out your time to work on it and making those meetings unbreakable. Be honest with yourself; this will be an intense time period with long hours and lots of sacrifices. But it’s just a chapter. The more dedicated you are, the faster you’ll be able to make your side hustle your full-time hustle,” says Gervais.

Another way to up your commitment level is to formalize your business structure. Tasha Cochran, one half of the YouTube channel One Big Happy Life, recently quit her job to pursue her blogging hustle full-time. As she noted on her website: “We became an LLC, signed a partnership agreement and started to be more strategic about what we were doing.”

3. Look for Ways to Work Smarter

A side hustle can be hard to scale but it’s not impossible. One way to grow your side hustle is to transition from a one-to-one business model to a one-to-many business model. Translation: Figure out how to earn money while you sleep!

One booming market for doing this is the e-learning industry. According to Reuters, global e-learning grew to $165.21 billion in 2015 and is expected to skyrocket to $275.10 billion by 2022.

Just be aware: In order to scale an e-learning business with a host of online courses, you do have to hustle.

For example, Robyn Parets migrated online with her branded Pretzel Kids Yoga Teacher Certification Course in 2016. Pretzel Kids still offers live trainings and kids yoga classes, but the online school allows the company to grow its reach globally. Pretzel Kids nows sells a host of courses via its online kids yoga training school, such as How to Teach Mindfulness to Kids and Yoga for Kids with Special Needs. In addition, Pretzel Kids instructors can join a membership community where they can access branded materials, download teaching resources, get booked for teaching gigs, and more, says Parets.

“The ability to offer online trainings and a membership community has been pivotal to the growth of Pretzel Kids. We also offer our trained teachers a way to immediately start their own side hustles using our curriculum,” she says.

4. Invest in Yourself

Have you ever heard the saying the best investment you can make is in yourself? This is especially applicable to scaling your side hustle because you are your biggest asset.

As a full-time entrepreneur to-be, the learning process should be a continuous one. In the early days of scaling your hustle, you might have to invest in tools and courses to beef up your skill set. For example, you may need to learn more about email marketing or social media. Yet, in the long-run, this will save you time and money.

You can also fast-track your success by finding a mentor and connecting with other like-minded people who can help your business thrive.

5. Wait Until Your Side Hustle Earnings are Consistent

Before you make the leap from full-time employee to full-time entrepreneur, your side hustle earnings should either equal your current income or be sufficient enough to cover your living expenses.

Don’t forget to include a line item in your new budget for those intangible benefits that your current job provides, including health insurance, 401(k) contributions and the like. For example, if you have to say goodbye to free lunch on Fridays or free daily coffee, make sure to add these as new expenses each week.

Another tip is to wait at least a few months in order to determine whether your side business will produce consistent earnings. This is exactly what Gervais did. Once her side business started regularly bringing in more money than she made at her 9 to 5 job, she had the confidence to turn it into her full-time job. Today, her online business generates more than $10k in sales per month.

6. Boost Your Emergency Fund Before Taking the Plunge

If you have a healthy savings account, then you’ll have peace of mind to go all-in on your side business. To help you boost your emergency fund faster, you can try automating your finances.

With a Chime bank account, for example, you can save when you get paid and automatically direct a percentage of every paycheck into your Chime Savings Account. This way you can put your savings on autopilot and reach full-time entrepreneur status sooner. As a bonus, if you use your Chime Visa Debit Card to make purchases, Chime will round up each purchase you make to the nearest dollar, and transfer the round up amount right into your Savings Account.

7. Schedule in Self-Care

When you’re working to scale your side hustle into a full-time business, it’s easy to put health and wellness on the back-burner. But taking care of your physical and emotional well-being is more important than ever at this stage. The good news is: Self-care doesn’t have to be expensive. It can be as simple as scheduling in a 30-minute walk each day to get some fresh air and mental clarity, reading a book or enjoying a long bath.

Ready, Set, Go!

If transitioning your side hustle into a full-time gig is something that you’ve been on the fence about, we hope these seven tips will give you the push you need to start living your dream!

 

How to Ball on a Budget When You Go Out

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Let’s say you get a call from a close friend. She just got a promotion at work, and she’s inviting you to a trendy Thai restaurant to celebrate. You love Thai food and want to go, but there’s one problem: Your budget’s looking pretty tight this month.

Thankfully, you can still go out without compromising your savings. For example, you can decide how much you can spend and then adjust your budget accordingly.

“If you know that in the summer, you tend to go out more and spend more money, then make room for that in your budget and cut back in other areas to accommodate that,” says Jamila Souffrant, certified financial education instructor and founder of the blog and podcast Journey to Launch.

For instance, you can cut the cable cord and ditch your meal box subscription, leaving more wiggle room for nights out, concerts and movies. To help you get started, we’ve rounded up some tips for saving money on just about any outing. Take a look.

At a Sporting Event

If you’re dying to see the Chicago Bulls (or your own favorite team), you can make it happen without breaking the bank. Souffrant recommends buying your tickets in-person from the box office to avoid service fees from online ticketers.

You can also pick games that aren’t super expensive. For example, maybe go on a work night when it’s less crowded and you can more easily score cheaper tickets. Typically, games during the week are less costly than Friday, Saturday, or Sunday games.

On the day of the big game, be sure to eat before you leave home to avoid paying the markup at the snack counter. Your belly and your bank account will feel fuller.

At a Movie

Sometimes, it’s good to catch a summer blockbuster on the big screen and swoon over your favorite actors. Just be sure to steer clear of the overpriced movie theater concession stand.

“Definitely do not buy any of the snacks or drinks in the movie theater. I know it’s tempting, but eat before you go and/or bring your own snacks,” says Souffrant.

Souffrant also recommends looking for discounted tickets or deals on sites like Groupon or the theaters’ own website. You can also go to a weekend matinee and head out to dinner afterwards – instead of the other way around.

By planning in advance, you can enjoy buzzworthy movies and save money at the same time.

At a Concert

Hanging out with friends at concerts is part of summer fun. But to save money, it’s important that you try to buy tickets at the box office in advance, says Souffrant.

Why? You’ll typically get the lowest price, she says.

Even if you can’t manage to score inexpensive tickets (some of us are Beyoncé fans), you can find other ways to save when you consider the costs of the whole night. Souffrant suggests carpooling or even taking public transportation to the event.

If your concert-going night involves multiple destinations, you may want to turn on push notifications from your bank. You’ll get an alert each time you use your debit card, which may be the reality check you need to curb your spending.

Lastly, look for free concerts in your city. While you might not be able to attend a Beyonce concert for free, there are plenty of other bands and music festivals that offer free concerts.

At a Restaurant

Back to the friends-at-a-Thai-restaurant example: When you’re going out to eat, it can help to speak up about your financial goals.

“If you’re on a budget or you’re trying to save money, don’t keep it to yourself,” says Souffrant.

When you explain your intentions at the start of a night out or before you arrive at the restaurant, your friends will be more likely to understand when you choose to pay only for what you ate and drank.

“I would avoid splitting (the check) equally. That can get expensive if you’re trying to be conscious but they’re not,” says Souffrant.

If you do decide to split the bill, try using Chime’s Pay Friends feature.

At a Bar or Nightclub

If you can avoid a cover charge by getting to your favorite spot before a certain time, then do it, Souffrant says.

You and your friends can also do research in advance to see which local watering holes have special offers or discount nights. Lastly, consider nursing one drink or sticking to water to save money on the bar tab. This way you can still enjoy a night out with friends without overspending.

At an Exercise Class

If your friends are veteran yogis or distance runners, they may have guest passes to a gym or fitness studio that they can share with you, Souffrant suggests.

“You can also just try out the good old park,” she says.

Besides being healthy, workouts at the park are totally free.

“Go together, take a run, take a walk. Use the environment for your own workouts and outside activities.”

Save Money and Have Fun

The tips above make one thing clear: You can meet your savings goals without becoming a hermit.

One final pro tip: Try automating your savings. If you use a Chime Visa Debit Card, for example, every time you use it to purchase concert or movie tickets, or pay your restaurant bill, your transaction will be rounded up to the nearest dollar. And, that round up amount will be automatically deposited into your Chime Savings Account. This way, you’ll save money while you’re out enjoying yourself!

 

What’s A Good Credit Score in Your 30s?

You likely spent your 20s growing a lot, making mistakes, and discovering yourself. Your 30s, however, are a time for refinement and fine-tuning.

While in your 20s, you were just starting your financial life. Yet, hitting the big 3-0 signaled that it was time to level up your finances. One way you can do this is by improving your credit score.

In this guide, we break down what a good credit score looks like your in 30s, and why this is important.

A good credit score in your 30s

When you’re in your 30s, you’ve had a decade to establish and build your credit. You might still have student loans, as well as several credit cards. You may even have a car loan or a mortgage.

If you played your cards right, your credit score may be in good shape. But if you spent your 20s racking up credit card bills and in denial about your student loan debt, your credit score might not be so hot. According to data from Credit Karma, the average credit score for 25-34 year olds is 628. The most popular credit scoring model, FICO, defines a “good” credit score as 670 to 739.

If you take the average credit score of 628 and add the other two data points that FICO describes as “good” – 670 and 739 – and divide by three, you get 679. And, while a credit score of 679 is a good benchmark in your 30s, having a score in the low to mid 700s is even better.

Let’s back up a bit. In your 30s, a good credit score in the 700s should be attainable. Why? Take a look at these factors to understand what contributes to your credit score and why a good score can be achievable in your 30s.

What factors make up your credit?

The length of your credit history is one of the factors that make up your credit score. By your 30s, you should have a solid credit history with years of data.

On top of that, your credit mix is another factor that contributes to your score. This refers to the different types of credit you have, like an auto loan and a credit card. By your 30s, it’s likely that your credit mix is more diverse, which can boost your score. For example, you might have an auto loan, student loans, credit cards and a mortgage. If you make your payments on time and keep your balances low, this can reflect well on your credit score.

The two main factors that contribute to your credit score are your payment history and your credit utilization. If you have years of positive repayment history and never missed a single payment, then time is on your side! This can show lenders that you’re a responsible borrower.

Additionally, keeping your balance below 30 percent of your available credit, also called your credit utilization, is important. If you have high balances, whether you pay them off in full each month or not, this can be a red flag to lenders who might think you’re a risk.

Given all of these factors, you should aim for a “good credit score” in the 700s. If you’re not quite there, don’t fret. Pay off your debt, keep your balances low, minimize the number of accounts you open, and pay your bills on time. This will help boost your credit score.

Why is having a good credit score in your 30s important?

So, why is having a good credit score in your 30s important anyway?

Your credit score can seem like just a number. But in your 30s, when you’re ready to level up your finances and life, a credit score can make or break your options.

For example, you may be ready to start a family and buy a house. Your credit score, in turn,  can influence whether you get approved for a mortgage and what interest rate you get.

Or, perhaps you want to refinance your student loans to try to save money. Good credit can help make this achievable. Plus, if you have kids and want to get a minivan, you’ll want to snag a great rate on an auto loan. And, you guessed it, a good credit score will help you get a lower interest rate.

Bottom line

Your 30s are all about coming into your own and refining everything you learned in your 20s. This is true of your credit too! This is the time to look at your mistakes, reflect and revamp. If your credit isn’t great, you still have time to improve and all is not lost.

Just think: Once you have a good credit score in your 30s, you can get the best interest rates and start reaching your life milestones without all the extra costs.

 

How Long Should You Side Hustle For?

Side hustling is a great way to make extra money. The more successful your side hustle is, the more motivated you are to continue, right? Not exactly. There are many other factors that contribute to the longevity of your side hustle.

Here’s how you can tell how long you should side hustle for.

Set a Goal If You’re Trying to Leave Your Job

If you’re side hustling in order to leave your full-time job, it’s important to set a deadline for when you’d like to leave and under which circumstances. How much do you need to earn? How many hours to do you expect to spend working?

For me, unfortunately, I had hit a breaking point with my side hustle which prompted me to leave my 9-5 and turn my side hustle into my full-time job. I was burning out from working so many hours between both jobs.

Luckily, I was earning enough money to allow myself to quit without too much worry. Still, this is something to keep in mind. If you plan on working several hours and building a business up on the side, set a goal as to when you will make the transition to full time so you know that side hustling is only temporary.

Consider What Your Short Term Goals Are

Are you side hustling just to meet a short term goal? Whether it’s to pay off debt, fund a large purchase, or to gain a new skill, get clear on why you’re side hustling so you can meet those short term goals.

Also, develop a plan for what you’ll do after you reach them.

Is Your Side Hustle Still Enjoyable?

This is a question my husband is faced with currently. He’s been side hustling with Uber for about 3 years now. He admits it’s not as enjoyable as when he first started.

In the beginning, he wanted to side hustle to help us pay for extra expenses, pay off his car loan, and save more for the downpayment on our home.

We have met all of those goals and he’s gotten to a place where he’d rather stay home at night instead of going to drive for Uber. We could still use some extra money each month, but it seems like it’s time to switch to another side hustle.

Since you’re working on the side, you’re already putting in extra hours so you might as well do something that you enjoy and are good at. If your side hustle is no longer enj0yable and doesn’t stimulate you, you’ll lose motivation and it will feel more like a chore.

Consider Working in Seasonal Spurts

If you plan to make your side hustle a long-term venture, continue working is seasonal spurts. That way, you’re expected to be “on” and working all the time. Working 7 days per week is not sustainable for anyone long-term.

Choose a side hustle that’s flexible and allows you to pick up or drop hours as you see fit. For example, you may want to work more hours during the summer when work at your main job is slow. A seasonal side business can be more sustainable because it allows you time to rest.

Summary

Side hustles are often great to have, but all good things tend to come to an end. Be intention when deciding what type of side hustle you’ll try and what your goals are. Consider doing flexible work and allowing yourself the freedom to slow down or speed up production as you see fit.

 

Are Alternative Education Programs Worth the Investment?

The numbers aren’t pretty. In 2017, the average college graduate had an average monthly student loan payment of $393. In 2018, outstanding student loan debt among all Americans stood at $1.44 trillion, and 12% of that debt was at least 90 days past-due.

With numbers like that, it’s no wonder you might be rethinking getting a four-year degree. After all, it’s not uncommon to hear about people taking out crippling student loans only to go right back to working at Starbucks.

Yet, there is another option — alternative education programs. These can be trickier to cobble together since you may not have access to an easy pipeline of federal student loans (for better or for worse), but it can be done. We’ll give you the scoop on some common programs, and how you can make them work for you and your bank account.

Coding Bootcamps

Have you heard of coding “bootcamps”? These programs are designed to fast-track you to an entirely new career in the tech industry in as little as three months. And, did you know that these bootcamps offer the potential of making a six-figure salary right out of the gate. (It’s true: my husband just got a high salary offer after finishing a General Assembly coding bootcamp.)

Coding bootcamps aren’t without their risks, however. They’re generally expensive. For example, Full Stack Academy costs up to $17,910 for a 13-week program, and General Assembly charges up to $13,950 for its program. These courses may offer pay-in-full discounts, scholarships, income sharing agreements, or personal loans as a way to pay the tuition bill if you can’t pony up the cash on your own.

It’s important to thoroughly vet these programs before you attend, and don’t just trust the statistics that the companies publicize. Instead, ask to speak with real graduates who’ve gotten jobs, and ask about the outcomes of their classmates as well to get a more realistic view of what you can — or cannot — expect.

Start a Business

Sure, your grandpa may have told you to start your own business like he did instead of going to college. These days, however, you don’t necessarily have to go it alone.

There are many programs out there dedicated to helping budding entrepreneurs launch startups. These outfits — including accelerators, incubators or startup accelerators – can provide the technical expertise, coaching, office space, and even funding to launch your business successfully.

Typically, you apply for these programs, and need to be accepted to get in. Some are run by universities (meaning one or more people on the team need to be an enrolled student), and others are private groups. Accelerators typically make money by taking a stake in your business (i.e., equity), so they have a vested interest in helping your company succeed.

Associate Degrees or Certificates

Who said you need a four-year degree to succeed? Maybe you only need two years of college, or less. The reality is that many professions only require a couple years or less of coursework, including:

  • Radiation therapist
  • Physical therapist assistant
  • Dental hygienist
  • Emergency medical technician (EMT)
  • HVAC technician

The advantage of these career prep programs is that they’re often in high demand, meaning your odds are good for getting a job. You can also use student loans to pay for your education, but you won’t have nearly as much debt coming out of school as you would if you graduate from a four-year-degree program.

Join the Military

It’s true — Uncle Sam wants you. Yet, careers in the military can come at a high personal cost. Depending on your MOS (Military Occupation Specialty — i.e. your job within the military), you may see active combat in war zones and be deployed away from your family for long periods of time. You may also not get to choose where you live — the military will decide for you. You could end up living in a exotic location abroad, or in a cornfield in Iowa.

The rewards, however, are equally as great. You’ll be paid for the entire duration you’re in the military, including while you’re in training (and you can even take these skills with you to new jobs if you leave the military.)

You can earn extra pay in the way of signing bonuses if you choose certain specialties that may require you to be in a combat zone, a high cost-of-living area, or outside the continental U.S. The military may also provide housing and health care for you and your family, GI Bill benefits, subsidized housing, and retirement benefits.

Trade Apprenticeships

Since so many people are being pushed to go to college these days, there’s actually a serious shortage of jobs in the trades. This includes construction workers, plumbers, electricians, pipefitters, factory workers, and other physical jobs. From 2016-2026, the Bureau of Labor Statistics expects openings for another 180,500 construction workers.

This leaves a wide-open opportunity for you: Jobs are in high demand and salaries are equally high to match. Even better, many trade unions offer apprenticeship trainings for an affordable price or even for free. You may not be paid while you’re actually in class (which generally lasts for a short time), but you’ll be paid while you’re learning on the job.

You Don’t Necessarily Need a Four-Year Degree

Don’t let anyone push you into a four-year degree if that’s not what you want. The truth is that there are plenty of other options out there these days, and more are springing up each year.

College used to be a guaranteed way to get a leg up. But unless you have a concrete plan or know exactly what you want to do, it can also be a liability, especially if you have to balance savings with debt payments. Instead, set your sights on what matters most to you in your career — whether that includes college or not.

 

4 Things Daenerys Stormborn Could Teach You About Money

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She walks through fire. She frees entire cities of slaves. She has dragons at her beck and call.

Without a doubt, Daenerys Stormborn of the House Targaryen, First of Her Name, the Unburnt, Queen of the Andals and the First Men, Khaleesi of the Great Grass Sea, Breaker of Chains, and Mother of Dragons is the fiercest character on Game of Thrones.

She’s also one of the most complicated, and one of the most admirable. While I don’t agree with her every decision, I do believe she can teach us something about life — and about how to get paid, even when it requires some blood, sweat, and tears.

Here are four ways to rule your money like the Mother of Dragons.

Believe in Yourself

So many of us have self-doubts when it comes to our finances. We think that we’re doomed to be “bad with money.” Or that being “comfortable” — wealthy, even — is for other people, but not for us.

If you’re nodding along in agreement, take a page from Dany’s book. “So many men have tried to kill me, I don’t remember all their names,” she told Jon Snow. “Do you know what kept me standing through all those years in exile? Faith. Not in any gods. Not in myths and legends. In myself.”

Unless you believe in yourself and your abilities, you’ll never find financial success. The best way to empower yourself is through education. By devouring podcasts, newsletters, and articles, you’ll eventually develop the financial confidence you need.

To fast-track your knowledge, I recommend the books Get Money and Broke Millennial. Since both were penned by kickass women authors, I’m pretty sure Queen D would approve.

Build a Team

Although Daenerys exudes confidence, she’s also smart enough to know she doesn’t know it all. Along her journey to power, she’s amassed a slew of advisors to help guide her decisions.

As she once said, “It takes courage to admit fear… and to admit a mistake.”

The same goes for your finances. While it’s essential to build confidence, it’s also essential to create a strong financial team as backup. You don’t need to be rich to do so, either. Here are some potential members of a 21st-century financial team:

  • Apps, apps, apps: All of us have a team of financial advisors in our pocket. Between apps for budgeting, paying and trimming bills, and managing money with a partner, embrace the wealth of technology available.
  • A trustworthy bank: Make sure your bank’s got your back. The Breaker of Chains would never stay with a bank that nickeled and dimed her — in fact, she’d probably burn it the ground. So choose banking with no hidden fees that prioritizes you as a customer.
  • A robo- or human financial advisor: This one’s not as vital as the others, but it can certainly help. Get robo-advising for your investments through apps like Wealthfront or Personal Capital, or seek human assistance with a fee-only advisor through the XY Planning Network.

When you surround yourself with high-quality people and products, you’ll find the support you need to achieve financial success. (Even if nobody on your team loves you quite as much as Ser Jorah loves Khaleesi.)

Listen to Your Values

“Our fathers were evil men,” Dany told Yara and Theon Greyjoy. “They left the world worse than they found it. We’re not going to do that. We’re going to leave the world better than we found it.”

Daenerys lets this sense of justice guide all of her decisions — even if it means slaying thousands of slave masters. While I’m not suggesting you follow those specific footsteps, I do think you can consider your values when making financial decisions.

One way is through “sustainable investing,” which encompasses a range of different strategies, including:

  • Divesting: Pulling your investments out of companies you don’t support, such as those in the fossil fuel or firearms industries.
  • ESG monitoring: Investing in companies with high environmental, social, and governance (ESG) scores, or in ESG-focused index funds.
  • Impact investing: Funneling your money toward specific causes like renewable energy.

Just like the woman who would become “Mhysa” to many, you can also let your moral compass drive your financial moves.

Don’t Let Anything Stand In Your Way

Throughout Game of Thrones, people have scoffed at Daenerys and her lofty goals. The Dothraki warlords laughed when she said she would rule them all. Then she burned them down. Others said the Dothraki would never cross the sea. Then they did.

Khaleesi never let the haters get to her. “I am not your little princess,” she declared. “I am Daenerys Stormborn of the blood of old Valyria and I will take what is mine, with fire and blood I will take it.”

Using that as inspiration, think about your money goals. How can you Mother-of-Dragons them by making dramatic changes?

If you want to retire early, for example, move to a new, more affordable city. If you want to accrue a six-month emergency fund, calculate how much to set aside each week, and set up an automatic savings contribution right now. If you want to earn more money, walk into your boss’ office and ask what you need to do to get a raise.

The bottom line: If you have a financial goal, don’t make any excuses. O.K., maybe don’t burn down an entire city with your dragons (#dracarys), but you know what I mean.

How the Mother of Dragons Can Help Your Finances

While Daenerys’ strategies may be a little, well, unconventional, we can still learn a lot from this powerful character.

By sticking to your values, educating yourself, and creating a solid financial team, you’ll gain the confidence to crush all of your money goals — no dragons required.

 

10 Best Money Books to Improve Your Financial Literacy

Some people seem to be naturally good at managing their money – they’ve always had cash in the bank and they actually enjoy budgeting.

On the other hand, there are those people who struggle with money. Maybe it’s due to a lack of financial knowledge, a drastic amount of debt, or simply feeling overwhelmed.

If you identify with the latter, you are not alone. In fact, in a recent study conducted by Student Loan Hero, just 43 percent of respondents stated they feel like they are financially successful. This means that a whopping 57 percent said they’re not financially confident. Yikes.

But here’s the good news: There are plenty of educational resources available, including excellent books that can help you gain more insight on your finances. Whether you’re looking to pay off debt, save more money, or start investing, there is a book for you.

Not sure where to start? Check out these 10 books that can help you improve your financial literacy.

1. Best book for millennials: Broke Millennial: Stop Scraping By and Get Your Financial Life Together by Erin Lowry

Everyone has to start somewhere. Even if you’re relatively new to the financial scene, there are tons of quality books to help teach you everything you need to know. Yet, Erin Lowry’s book, Broke Millennial: Stop Scraping By and Get Your Financial Life Together, stands apart from the rest.

Lowry’s simple, conversational tone is certainly helpful, as she walks you through the basics of budgeting, picking the best bank for you, dealing with debt, preparing for retirement, and more.

2. Best book about student loans: Bye Student Loan Debt: Learn How to Empower Yourself by Eliminating Your Student Loans by Daniel J. Mendelson

Author Daniel J. Mendelson and his wife once had nearly $150,000 of student loan debt due to many years of graduate school and hefty interest rates. By creating and sticking to a simple repayment process, the couple became debt-free within five years.

In Bye Student Loan Debt, Mendelson walks you through his simple debt repayment system. And more importantly, the book will give you hope if you are feeling like you’ll never pay off your student loans.

3. Best book on frugality: 365 Ways to Live Cheap: Your Everyday Guide to Saving Money by Trent Hamm

Frugality is one way to fix your financial situation. By living on the cheap, you have more money for the things that are truly important to you.

Trent Hamm, founder of the blog The Simple Dollar, knows how to be frugal. Hamm credits frugality and mindfulness for overhauling his formerly dire financial situation. And, his book, 365 Ways to Live Cheap: Your Everyday Guide to Saving Money, offers some easy ways to save money in your day-to-day spending.

4. Best book for investing: The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns by John C. Bogle

The Little Book of Common Sense Investing is the classic guide to getting started with the stock market. And, while you may not recognize the author by name, you certainly know of him – John C. Bogle is the founder of the investment company Vanguard. Bogle believes investing is for everyone, regardless of your education, income or experience.

While the stock market has its ups and downs, Bogle’s book has withstood the test of time. It is now on its tenth anniversary edition.

5. Best book for increasing your income: Hustle Away Debt: Eliminate Your Debt by Making More Money by David Carlson

While most financial books focus on saving, Hustle Away Debt offers a fresh perspective by teaching you about the importance of increasing your income.

Author David Carlson is also the founder of the popular millenial financial blog Young Adult Money. In his book, he details his secrets to getting out of debt by increasing his income through side hustles. If you’ve ever wanted to increase your income while learning new skills, then this book is a must-read.

6. Best book on budgeting: The Money Book for the Young, Fabulous & Broke by Suze Orman

Suze Orman is one of the original financial gurus. She has seven New York Times best sellers, but you may recognize her most from her television show, The Suze Orman Show.

Orman provides to-the-point, no frills financial advice. For those just learning to budget (or learning to stick to a budget), look no further than The Money Book for the Young, Fabulous & Broke. Orman walks you through everything you need to know.

7. Best book for couples: Money Talks: The Ultimate Couple’s Guide to Communicating About Money by Talaat and Tai McNeely

Relationships and money are often a neglected topic. In fact, in a study by CreditLoan.com, over 30 percent of men and women hid a financial secret from their partners.

To say there is room for improvement is an understatement. That’s where Money Talks: The Ultimate Couple’s Guide to Communicating About Money comes in. This book hits on a sometimes sensitive topic. Not only does it provide valuable communication tips, but it teaches you how to set and achieve financial goals as a couple.

8. Best book for general financial advice: Total Money Makeover by Dave Ramsey

Dave Ramsey is one of the top financial writers out there. His book, Total Money Makeover, shows you how to take control of your finances in a simple 10 “baby-step” process, which includes paying off debt, saving for an emergency fund, starting to invest, and other financial goals.

Total Money Makeover provides foolproof, no-nonsense advice for anyone looking to improve their financial situation.

9. Best book for saving: Rich Dad Poor Dad: What the Rich Teach Their Kids About Money – That the Poor and Middle Class Do Not! by Robert T. Kiyosaki

In the book Rich Dad Poor Dad, author Robert Kiyosaki outlines the lives of two men: his father, who was constantly broke, and his father’s friend, a wealthy entrepreneur. He believes “street smarts” can often be more valuable than a more traditional education.

Rich Dad Poor Dad challenges the conventional ideas of saving by providing information on how your current view of money can affect your future finances.

10. Best book for early retirement: How to Retire Early: Your Guide to Getting Rich Slowly and Retiring on Less by Robert and Robin Charlton

At the age of just 43, Robert and Robin Charlton were able to retire from their full-time jobs. They had worked a collective total of just 15 years. They now run a website, WhereWeBe.com while traveling the world.

Their book, How to Retire Early: Your Guide to Getting Rich Slowly and Retiring on Less, is designed to help others do the same thing they did. They outline repeatable steps that anyone with a full-time job can implement. Overall, they aim to communicate that retirement is not just a dream. It’s achievable.

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