An article on Brownsville Herald recommend saving more money as a resolution to keep. According to a report from the Pew Charitable Trusts, over half of American households have less than one month of income available in case of an emergency. Personal finance bloggers often advise to keep at least three to six months of income as a part of emergency fund. However, saving can be difficult for those with household incomes of less than $35,000. The ability to save mostly depends on age and household income. So, does saving more money rank near the top of your resolution list?
According to Oxfam report, just 62 people own about the poorest half of the entire world population – or 3.6 billion people. Back in 2010 it took 388 rich people. But as the global inequality has reached levels not seen in over a century, the richest 1 percent own more than the other 99 percent put together. To put that into perspective, the wealth of the poorest half of the world’s population – that’s 3.6 billion people – has fallen by a trillion dollars since 2010 while the wealth of the richest 62 has increased by more than half a trillion dollars.
Some of the basic concepts of personal finance needs to repeat as often as possible. One of them is to live below your means as written by Jonathan Chevreau of Financial Post. Live below your means is considered as an eternal truth of personal finance. “This is the granddaddy Truth of personal finance. Without it, there’s little point talking about the rest. The only way to become financially independent is to be consistent about spending less than you earn, year in and year out, decade in and decade out.” The formula for happiness, attributed to Charles Dickens, is based on living below your means. If translated into today’s world, in David Copperfield the character Micawber would say: “Annual income $50,000, annual expenses $40,000, result happiness. Annual income $50,000, annual expenses $60,000, result misery.”
The Price of Happiness is confirmed to be $75,000 Per Year by a study from Princeton University. Another article written for About Money delves into the relationship between money and happiness as Joshua Kennon discuss this topic of how much money it takes to be happy. The first step to financial success is to define what you want. Once you narrow down the income the next step is to figure out the safe withdrawal rate to be happy with that income level. By selecting the proper asset classes, you can deride how much money you need in your portfolio to achieve your desired level of happiness.
On Money, Financial blogger Jason Vitug shows three essential money concepts for millennials to become financially savvy: Define your lifestyle, don’t keep up with the Joneses, and money can indeed buy happiness.
According to USDA Report, the total cost to raise a child for food, housing, childcare and education, and other child-rearing expenses up to age 18 is $245,340. That report does not included the costs associated with pregnancy. Holly Johnson of the Simple Dollar put into details the total cost to have a baby by include the medical costs, the impact of maternity leave, and the ongoing costs of caring for a newborn. While the true cost of having a baby depends on one’s health insurance and place of residence, the new parents can expect to pay up to $6,500 for out-of-pocket expense out of the average cost of $10,000 for delivery and a hospital stay. The cost adds up when the yearly $6,960 premium for health insurance is included along with associated costs. Overall, the bundle of joy also comes with extra financial responsibility.
Millennials, born from 1980 to 2000, are now the largest, most diverse generation in the U.S. population. Here are some top financial mistakes that millennials make, written by Ashley Eneriz for Everything Finance blog. The financial mistakes include taking on a lot of debts, not saving for retirement, not having emergency fund, passing up on health insurance and ruining credit scores.
Interaction with pets can provide stress relief and comfort to pet owner. But taking care of pet costs money. Before you go out to get a pet, Jessica Sommerfield explains that there are some financial costs to consider before getting a pet. Whenever you travel there’s boarding fee for your pet. If you rent, there’s also deposit for pet along with damage expenses. Finally, you also have to consider vet bills throughout the lifespan of your pet.
In this day and age, it is easy for anyone to create a website. Domain will cost around $12/year and hosting will cost $3.49/month through BlueHost. WordPress will let you set up and run your website quickly. Anyway, Financial Samurai shows some reason for you to start your own website today. With a website, you can connect with many people and do what you love. You can also make some money along the way and the website looks good on your resume. Finally, with your own website you can create your own legacy.
Do you consider yourself as a middle class? and how do you define middle class anyway? Amy Livingston of Money Crashers delves into this issue of what is middle class in America. Often we hear from politicians talking about middle class without giving an exact definition. Media has various definitions to accommodate their viewers. The median American household income was $53,657 with an average net worth of $85,712, but these figures are not the whole picture. In addition to income and net worth, you have to look into education, occupation, lifestyle and aspiration to define the middle class. So it is not possible to define the middle class with household income only.
Saving money doesn’t require one to sacrifice to the extreme. FrugalTrader from Million Dollar Journey gives some real life examples on how to save more money with less effort. It’s hard to find way to cut costs and to save money as most of us are influenced by friends, neighbors and co-workers. The trick to save money is to focus on the largest expenses such as mortgage, car payment, groceries, etc. By refinancing debts or eating out less often, one can quickly and easily save more money every month.
If you are undecided between term life insurance and whole life insurance, Ben Edwards at Money Smart Life has some advice about this insurance debate. He points out that almost in all cases, term life insurance is your best choice. The reasons are that it costs a lot less than whole life insurance and that you can buy a lot more term life insurance compared to whole life insurance while leaving you with more money to invest. Those are very good recommendations. Don’t confuse between insurance and investment. Term life insurance is pure life insurance. So if you are going to get a life insurance, term life insurance is better than whole life insurance.
Jeff Rose shows how to master your money to to become a financial Jedi Master. He gives out simple tips to join the Jedi rank. To master your finance you must tap into the light side of the Force by thinking honestly about your finances and don’t become another Darth Vader by letting money and power to corrupt you.
There’s a lot of guides online giving you advice on how to be successful. Personal finance blogger Ramit Sethi, at I Will Teach You To Be Rich, show us the three critical success habits that he has developed to find success in different areas of life:
- “Success habit #1: Pick one goal
- Success habit #2: Work twice as hard, get 10x the results
- Success habit #3: Always have a mentor.”
Grocery is a part of every household’s living expenses. According to United States Department of Agriculture, the cost of food at home for a family of four is around $1000 per month. Mr. Money Mustache shows how to dramatically cut this $1000 grocery bill by over 60%. First you have to nail down how much you want to spend on food per month. Mr. Money Mustache gives us an example of a family of four spending $365 per month or around $1 per day for a family member. The key part is you have to cook at home for your day-to-day foods. By shopping at places like Costco, instead of Whole Foods, you can get the needed ingredients for all your meals. By mixing the expensive foods with cheaper ones, you can make very good meals that average out to $1 per person. Thus you can greatly reduce your grocery bill.