Category: Finance

monthly-budget

10 reasons you should use a personal budget

Personal budget is the most important instrument when it comes to our financial life.

It is the instrument that helps us control our financial life when it comes to our income and expenses.

Living without a personal budget is like going through a very big city such as Bucharest without being from Bucharest and wanting to go to various places without map or GPS.

The personal use budget is made of a projected budget where you have to anticipate each expense and each income you make in a determined period of time and of an achieved budget, where you have to write all expenses and income you made.

The budget is useful both for persons in a difficult financial situation and who want to go over this period, as well as for people who want to plan their way to get rich.

monthly budget

Using this financial instrument can give you lots of benefits regarding your financial health, because the budget:

 10 reasons you should use a personal budget

1. Helps you be aware of where you are spending your money!

It is the place where you plan and write all your expenses. It helps you see what are your money spent on and where you can make adjustment.

It is one of the most important options of the budget, because next is the financial planning.

2. Helps you know what are your income sources and how can you increase them!

It helps you plan your income. Most of the times, income is constant and you can hardly adjust it.

Most of the times, the budget helps you analyze your financial status and see if your income is enough for your expenses and for the financial objectives you set for yourself.

3. Helps you plan the expenses!

How many times have you realized that you are going shopping with the idea of buying something and coming back home with much more than you would have wanted.

The budget has its role of necessity. All things you should buy are written here, not the things you would like to buy.

It helps you make a difference between WHAT IS NECESSARY and WHAT YOU WOULD LIKE to buy.

Always choose WHAT IS NECESSARY to buy.

4. It helps you get rid of debts!

Yes, it helps you get rid of debts. Once you know what the income is and on what you spend the most, it helps you narrow the expenses and, with the money you save, pay your debts in a short amount of time.

5. Helps you avoid debts and spend as much as you produce!

Once the budget is planned, it guarantees that you will spend only what you produce. Your entire income should be larger than the expenses.

The difference between income and expenses represents the profit. With the profit you can pay your debts, start arrangements to buy a house, a car or to plan a vacation.

6. Helps you plan the purchase of a house!

The personal budget is your financial mirror. It shows you how much you earn and how much you spend.

It shows you how much profit you have in a month. This profit can be invested in a house.

For a new couple, that wants to buy a house, it is very important to use an internal use budget.

The house you can afford is the house that does not cost more than 2.5 times your total income per year.

The house you can afford = 2.5 * your annual income

It the result is higher than that, problems will occur regarding payment.

You can start with a smaller house and go to a bigger one after a while. Go to a bigger house only after you become the owner of the first house.

The budget helps you keep under control your expenses, house instalments and income without having financial problems.

7. Helps you be more structured and more realistic!

The budget helps you be more structured. It is designed as structured and as detailed as possible, to help you anticipate each expense by various expense categories.

Once the monthly budget is made, at first you will have many frustration reasons. In the first three months, you will not be able to plan your budget due to the fact that you are not being realistic.

You are subjective when it comes to the financial planning and you still think you will spend less and earn more.

Not true! You will spend and you will earn as much. The budget will show you this and will help you be more realistic with your budget each month.

You will end up being more realistic and more structured, not only with your money, but also in your daily activity.

8. Helps you save more!

Yes, it is the instrument which helps you save money from various places, in order to buy a product or to go in a vacation.

The budget gives you a faithful and real image of your financial status, where you can draw some conclusions regarding the places you can cut some costs.

With the money you cut, you can plan various expenses or you can reduce your debts.

bookkeeping

9. Helps you have multiple income sources!

The budget is also an instrument for rich people, not only for those that have financial difficulties.

With the help of a budget, you can also plan some businesses you might want to make, invest in various mutual funds or in the stock exchange.

In order to get here, you must get rid of all other habits of yours that make you spend more than you produce.

10 .Helps you be more motivated.

The budget helps you be more motivated. It gives you the motivation to want more from your financial life.

It helps you get rid of debts, have our own house, go in certain vacations and buy different things you want.

It is the most important instrument for your financial life and gives you the financial motivation to want more from yourself.

While planning a personal budget can take few hours each month, the fact that you learn to use a personal budget can bring you back money you may have never imagined.

We are spending money on things we do not need and we are running into debts for things we do not need. Why are we doing this?

Because we do not know what happens with our personal money!

Planning a budget each month and strictly complying with it, you can reach peace and quiet in your financial life.

If I have convinced you that a personal budget is useful, you can start from now planning your income and expenses with the help of a personal budget model you can download for free HERE.

It is a model I have created and which I recommend to all readers of this blog.

If you still have doubts about its use, you can ask me anything related to the personal budget in a comment below.

I will answer to any of your questions.

Business Credit

9 Steps to Establishing and Building Business Credit Unfolded

As a small business owner, either existing or new, you may have been denied getting business financing. Frankly, you may find the process daunting if you don’t know what it entails. Though I am not trying to make you fuss yet I must be honest to tell you that more than 50% of the owners of small businesses do not normally get approval when they apply for loans. Nevertheless, if you know how to get your way around it, you will surely get access to financing at ease. Therefore, you need to learn the secret of establishing and building a strong business credit in order to access business financing and credit with ease and move up your business. Here, we have covered the ground for you by providing you with all you need to learn and the steps you need to take in order to establish and build strong business credit to get off the hook of poor financing and take your business to the top.

Learning How to Establish and Build Business Credit – Why?

Establishing business credit in order to access business financing and taking the time to learn how to build it might be unnecessary while you have your personal credit to get you through. To be candid with you, separating your personal credit from your business has many benefits. One of the benefits is that it will help you go a long way in getting rid of the adverse effects one can have on the other. For instance, if due to some missteps, you know that your personal credit score is low and you will surely be denied of financing, you will rely on your business credit as the way forward. In order words, the bad score of your personal credit will not affect your business credit, and vice versa.

Build Business Credit

Once you are not running your business as a sole proprietorship or as a general partnership, you have to separate your business from the owner in order to protect your personal assets. This is one of the key benefits that limited liability companies and corporations offer business owners. Therefore, you need to establish business credit in order to keep this protection consistently in place.

Establishing and Building Strong Business Credit – The Untold Benefits

Apart from the fact that business credit will help you separate your business from your personal credit and secure the future of your business, there are many other benefits of business credit, which include:

1. Money-Saving

As a business owner, there are many channels that business credit can help you save your wallet. One of the ways is that it will help you secure favorable interest rates on loans. Secondly, it will help you minimize the situations when you need to repay for specific products or services.

2. Access to Funds and Assets

Unless you build a solid business credit profile, you will not have the guarantee to be approved for business loans from lenders, If you establish and build a good business credit profile, it will help you build confidence in business transactions. Thus, you will be able to have unlimited access to funds and assets from lenders, and ultimately, you will be able to make your business grow.

3. Establishing Better Trade Terms

Good business credit will make your suppliers have confidence in you; and hence, it will help you secure better trade terms with your important suppliers. So you will have unlimited access to obtaining supplies.

4. Increased Sales

As mentioned earlier, confidence is important in securing favorable business transactions. Customers will want to know whether you will be able to meet up and deliver their orders before they can seal a deal with you. Your business credit score is one of the ways customers can evaluate you. Unlike your personal credit, your business credit score is not so confidential, anybody can access it. Therefore, if you don’t have a good business credit score, customers are less likely to place orders, let alone placing big orders.

5, Protecting Your Personal Assets

When you need to apply for a loan with your personal credit, you will need to use your Social Security Number and lenders will have to access your personal credit reports in order to determine your creditworthiness. Apart from the fact that any ensuing problems will underscore your personal credit reports, you have exposed your personal financial situation to the public. Therefore, this will make it more difficult to get a loan for your business, even if you later want to use business credit, because your lenders might have been aware of your poor personal financial situations.

6. Securing Your Family

If all goes well, you may be able to secure loans for your business using your personal credit, but it may deny you the ability to borrow as an individual for your personal upkeep when the score becomes poor. Therefore, you and your family will be adversely affected and you know, you may, as a result, lose your family.

7. Minimizing the Need for Using Personal Guaranty

Dealing with personal guarantees is one of the big issues in dealing with getting loans for a business. A personal guarantee is an assurance that you will be able to pay off your business debts, in case your business is unable to pay the debt. If you establish business credit, it will help you draw a clear and vital line between your business and personal finances. Thus, you will be able to mitigate the need to sign a personal guarantee for your business funds.

Building A Good Business Credit Score – Food for thought

At this juncture, perhaps you don’t know, I need to tell you that one of the major reasons why business owners like you are usually denied access to funding is the failure to understand their credit situation and build it.

Business Launcher

Though in this article, you will understand how to monitor and build your business score, yet we will be flattering you to tell you that you have known all because Rome was not built in a day. This is why you need experts to control your business credit health and quickly get funding with ease and keep your business moving, According to Nav’s 2015 report, American Dream Gap Report, one in four of businesses fails to know why their financing applications are denied. Furthermore, according to the report, the businesses that understood their individual business credit score were less than 50% (41%, to be specific) more likely to get approval for small business loans. However, this is nothing to fuss about, you can be seamlessly getting fundings for your business once you sign up for a credible Business Launcher tool like that of Nav. Nav offers their customers free account to use their formidable Business Launcher tool to start building their business credit profile in no time. Although it is imperative that you know how to establish and build your business credit, and this is the next thing we want to teach you.

SBA Loans

How To Convince an SBA Loan Provider To Finance Your Business

The number of small businesses is the exact opposite of its size, which comprise the majority of businesses in the USA. According to the US Small Business Administration, small businesses account for 99.7% of all businesses in the USA, or a total of 28.8 million. These small businesses currently have 56.8 million employees and covers 48% of the total for USA.

The numbers speak the same with small business funding. Many financial institutions are taking advantage of the large market resulting in more small business funding solutions available. The same Small Business Administration (SBA) report said that there are about 5.2 million small business loans (valued at $ 73.6 billion) released by US lending firms in 2014.

SBA Loans

The market for small business lending is robust, and one can always find a solution that can fit any need and preference. A business will always have the answer on why get a small business loan. Here are some of the available small business lending solutions, and what you need to know about them:

Conventional Bank Loans

This is usually the first option when it comes to any kind of financing, whether for personal or business purposes. Small businesses, however, find its loan eligibility hard to achieve, and its requirements difficult to secure. They also deploy stringent terms and compliance measures.

The reason why most businesses flock around banks is because the bank’s loans carry smaller interest rates and they can also be generous with the amount as long as the eligibility criteria have been met. The disadvantage would have to be its strict requirements and the need for a collateral.

Alternative Lending Firms

They appeal most small businesses because of lenient terms and flexible repayment options. It is also more convenient to secure alternative funding because most providers can process your application online. This is most especially valuable for emergency cash needs.

Another advantage in dealing with alternative lending firms is their lenient terms and eligibility criteria, a lower requirement for credit score, and its faster processing and approval. The downside, however, is the excessively high interest rates and other additional upfront fees.

SBA Loans

A U.S. Small Business Administration (SBA) loan system is a funding solution backed up by the US government, which aims to support its citizens with the means to build and expand their own businesses. The SBA doesn’t provide the loan itself but serves as a guarantor to the loan coming from both private and public financial institutions that include banks and alternative lenders.

Small Business Administration partners with these financial institutions to offer a wide range of loan types that can suit the different funding needs of small businesses. It has a regulated set of guidelines, which all partners follow, in order to protect the interest of both the borrower and the lender. SBA guarantees for a percentage of the amount of every loan approved, which is about 70–90%. This minimizes the risk for the lender. On the other hand, the fact that a government small business loan is enough to know that the borrower is protected under its own laws and regulations. SBA loans offer lower interest rates than other alternative lending institutions.

The downside of an SBA loan is its long process, and it requires more paperwork. There are also top up fees to be paid when you avail.

Questions To Answer Before Getting an SBA Loan

Before approaching an SBA loan provider, make sure that you have the answer to the following questions:

  1. What is your borrowing intent?
  2. How urgent is your need?
  3. What are your business’ risks?
  4. In what stage of development is your business?
  5. How much do you need?
  6. How long can you pay the loan back?
  7. What is your business plan?
  8. How long have you been operating your business?
  9. What is the cycle of your business? Is it seasonal or consistently producing revenue?

By answering the above questions, you can help the SBA loan provider to assess your capacity and risk tolerance. It can also determine if you are eligible or not.

Reasons Why You May Be Denied From an SBA Loan

Small Business Administration loans are attractive to small businesses because of its advantages like low interest rates, flexible repayment terms, varied loan types, and primarily because it is government backed-up. Most alternative fundings compensate the higher risk involved with their grants by imposing higher interest rates, which can go as high as 80% APR.

Unfortunately, not everybody that applies for it are automatically approved. Many businesses have varied problems with small business loans that can hinder their growth, and here are the most probable reasons why you may not be granted with an SBA Loan.

Yours Is a Startup Company

An SBA loan requires for a business to be operating for at least 2 years.

You may opt for other funding options like angel investing or to a venture capitalist. There is also an online community-based funding solution like crowdfunding, which can cater to start up entrepreneurs. Cash flow based funding like merchant cash advances is also viable. There are also alternative lending companies that specialize in giving capital for startups, but the grant is not that big.

Yours and Your Business’ Credit Score Is Low

Like with conventional bank loans, SBA loans require a strong credit score, which is the most prevalent reason why most borrowers get denied.

A credit score, which most people might probably doesn’t know, is the numerical equivalent of your commitment to paying off your debts. It is computed based on your debt and credit histories with banks and other financial institutions. For example, you own a credit card. When you use your card, you will be billed on a designated cut off. If you diligently pay on time and in full amount and you are consistent with this for a long period of time, then, generally, your credit score will be high. When you do the other way around, say you don’t pay the full amount or you pay late, of course, your score will be low. But having no credit history can equally hurt your credit score because basically, there will be no means for a lender to assess your willingness and responsibility to pay.

There may be a lot of reasons why a business, or you, have a low credit score, and other alternative lending agencies are not too particular with these. Find one that can grant a loan for someone like you, which is also an opportunity to build your credit score again.

You Do Not Have Enough Collateral

Small Business Administration loans like bank loans do require a collateral. This collateral is being shared with the lender and the SBA because they share a part of the guarantee with the loan. Because of this, it may also require you a personal collateral too. This is also the reason why SBA loans cannot cater to startups because most of them doesn’t have more assets that can serve as a collateral.

Your Company’s Industry Is Part of the Grant’s Exclusions

Aside from startups, SBA loans won’t approve the loan applications of businesses in these industries:

  1. Businesses that are engaged in lending
  2. Life insurance companies
  3. Businesses outside the USA
  4. Businesses engaged in networking or any incentive-based model and pyramiding
  5. Businesses that get a third of its gross revenues from legal gambling
  6. Religion-based businesses
  7. Lobbying or political organizations
  8. Speculative businesses like oil explorations

You Don’t Want the Risk for a Personal Guarantee

Small Business Administration loans will need your personal guarantee, which meant your car, your home, and other personal assets. When you give this to the bank as a collateral, you give it the power to sell those when you cannot pay back your loan anymore.

There are other small business loan with no personal guarantee to ask from you, which may be viable if you are intolerant with this kind of risk.

So how to convince the best SBA loan providers to grant you that loan? You’ve got to be positive when it comes to these 5 C’s:

  1. Character – this implies your managerial skills or the strength of your management team. Your team should exemplify a strong sense of responsibility when it comes to their roles in your business.
  2. Credit Score – this is one important factor that SBA loan providers do look for, and it is also one of the hardest to repair. Even though you may be denied with an SBA loan, there is a lot of room in getting another small business loan provider that will fit your eligibility and needs.
  3. Capacity – a strong business plan and a steady cash flow are strong indications of your capacity to sustain in paying your liabilities.
  4. Capital – before getting an SBA loan, you should know how much additional capital you really need to finance your venture. This also includes information about the nature of your intent and the specific reason/plan for the grant.
  5. Collateral – there are different assets that can serve as collaterals other than real estate like personal assets (house, car), accounts receivables, and credit cards. When the cash flow and profits are good, it is best to slowly build up your assets, which can also help you for your unexpected future additional funding needs.
Bearer Share

What is a Bearer Share?

What is a Bearer Share? A carrier share is a value security completely claimed by whoever holds the physical stock endorsement, consequently the name “conveyor” share. The giving firm neither registers the proprietor of the stock nor tracks moves of possession; the organization scatters profits to carrier shares when a physical coupon is introduced to the firm. Since the offer isn’t enrolled to any position, moving the responsibility for stock includes just conveying the physical archive. Understanding Bearer Share Carrier shares come up short on the guideline and control of regular offers since possession is rarely recorded. Carrier shares are like conveyor bonds, which are fixed-salary protections having a place with the holders of physical authentications as opposed to enrolled proprietors. Key Takeaways Carrier shares are unregistered value protections claimed by the owner of the physical offer reports. The giving organization delivers out profits to proprietors of the physical coupons. The utilization of conveyor shares has dwindled overall since they cause expanded expenses and are helpful instruments to make sure about financing for fear mongering and other crimes. The Dwindling Issuance of Bearer Bonds Carrier shares are regularly worldwide protections, basic in Europe and South America — in spite of the fact that the utilization of conveyor partakes in these countries has dwindled as governments get serious about namelessness related criminal behavior. While a few purviews, for example, Panama, permit the utilization of carrier shares, they force reformatory duty retentions on profits gave to proprietors to demoralize their utilization.

Bearer Shares

Marshall Islands is the main nation on the planet where the offers can be utilized without issues or additional expenses. Numerous huge remote companies over the previous decade or so have additionally decided to change to full use of enrolled shares. Germany-based pharmaceutical mammoth Bayer AG, for instance, began to change over the entirety of its carrier offers to enrolled partakes in 2009, and in 2015, the United Kingdom abrogated the issuance of conveyor shares under the arrangements of the Small Business, Enterprise and Employment Act 2015. Switzerland, a purview known for its accentuation on mystery in banking exchanges, has additionally started the way toward changing over carrier shares into enlisted shareholdings. As of March 2019, the Swiss Federal Council has just started the procedure of interview to cancel conveyor partakes in the nation. In the United States, conveyor shares are for the most part an issue of state administration, and they are not customarily supported in numerous purviews’ corporate laws. Delaware turned into the main state in the U.S. to boycott by rule the offer of conveyor partakes in 2002, per the state’s site page on corporate law. Advantages of Using Bearer Shares The main unmistakable advantage to be picked up from utilizing conveyor shares is protection. The most elevated level of namelessness conceivable is kept up as for proprietorship in a partnership by a holder of carrier shares. In spite of the fact that the banks that handle the buys know the contact data of the individuals buying the offers, in certain wards, banks are under no legitimate commitment to uncover the character of the buyer. Banks may likewise get profit installments for the benefit of the investor and give proprietorship affirmation at investors’ comprehensive gatherings. In addition, buys can be made by a delegate, for example, a law office, of the genuine proprietor. Burdens and Risks of Bearer Shares The responsibility for shares regularly agrees with an expanded expense brought about from employing proficient portrayal and counsels to keep up the secrecy that conveyor shares give.

bearer-shares

Except if the carrier investor is a money related as well as legitimate master in these issues, dodging the numerous lawful and duty traps related with conveyor offers can be a troublesome test. Likewise, in a post-911 world in which the danger of fear based oppression lingers vigorously, some portion of the procedure to counter the danger is to remove the wellsprings of psychological militant subsidizing. Thusly, in an overall exertion to discourage psychological oppression financing, illegal tax avoidance and other unlawful loathsome corporate movement, numerous locales have ordered new enactment that places exceptionally close limitations on the utilization of carrier shares or, as referenced, have through and through abrogated their utilization. For instance, the Panama papers embarrassment broadly utilized carrier offers to disguise genuine responsibility for. This has brought about the hesitance of numerous banks and monetary establishments to open records or have any relationship with organizations or investors that bargain in carrier shares. The selection of locales and monetary organizations ready to bargain in carrier shares has limited fundamentally. Employments of Bearer Shares Carrier shares have some substantial uses, yet their innate drawbacks. Resource insurance is the most well-known motivation to utilize conveyor shares on account of the protection they give. For instance, people who would prefer not to chance their benefits being seized as a major aspect of a legitimate continuing, for example, a separation or an obligation suit may fall back on the utilization of carrier shares.

Business From Home

How To start a business From Home

With today’s internet technology, it’s not hard to start a business from home. The benefit of Home based business is that it’s not spend you so much money to start an own office for your business but you can still get good income and connect with millions of people from all over the world just by using a computer with internet connection from your home. If you intend to earn a good income by just working from your home and want to plan on starting a home based business. This article gives you some vital resources on how to start a business from home and steps by steps to start a business from home immediately without spending a large amount of money.

From Home

How To start a business From Home

All Resources & Steps You need to start a business From Home

1. Decide what kind of business you want to have when you start a business from home.

Before starting a business you always need to research your niche carefully. There are many difference niches to start a business at home but you need to choose what is between talents you have and things you enjoy. If you choose only things you enjoy that may not mean you will be good at it.

Resources:

Steps To Generate Niche Business Ideas
3 simple steps help you to generate Niche Business Ideas

Niche Keyword Research – The Right Approach
Easy guide to Learn How to Research Your Niche Market

Introduction to niche research and Clickbank
This video is a great look into how to go about doing your research with Clickbank

8 Step Blueprint For Doing Niche Research
Steps by steps to research niche to start business.

How to Research Your Business Idea
Your business idea may indeed be brilliant–or it may need some work. Here’s how to find out whether you’re ready for startup.

2. Know the competition in your niche.

The competition of a niche is sometimes very huge but that’s not mean you must stay away the niche you chose. You just consider for choosing a smaller niche. If you live in a smaller area, you have a better chance of landing that job.

Resources to learn how to research the completion in your niches:

How Niche Marketing Helped My Business Compete Against the Big Chains

Get to Know the Competition
A simple, 4-step competitive analysis will help you rise above the pack.

12 Ways to (Legally) Spy on Your Competitors to start business from home
Here are some time-tested methods that predate the Internet, as well as newer techniques to mine the wealth of information readily accessible online.

10 Tips on How to Research Your Competition for starting business from home
Keeping tabs on your competition is a great strategy for growing your business. Follow these tips, from fellow small business owners, on which tools are best and how to get started.

3. Understand the needs of your area.

Listen to what people say, what they want and what they need & meet them.

Resources:

Understanding People’s Needs
What kinds of needs do people have?, Why should the leader try to understand people’s needs?, How can a leader best understand people’s needs?

The analysis phase: Understanding what the customer wants

Understanding Customer Needs
The secret to start a successful business is to place your customers in the heart of the. An effective way to do this is to find out what they want and understand their needs.

4. Figure out your profits before starting a business.

Profits are all things you want so that you need to figure out before your business is started. To do this you must ask yourself two questions: How much will people pay for your services? Can you make a good income off this?.

Work at home

5. Check into legal barriers before starting your business.

Different countries/areas have different rules and regulations for home based businesses, and you need to check into those at your town’s city hall before investing much time and money in your business. Otherwise, you may get banned in the future.

6. Create a business plan on starting a business from home.

Think of what things you will do for your business & what time you can do such things. It’s that pretty hard to figure out a business plan but it’s very useful for you in the future.

personal budget

5 reasons why a personal budget fails!

If in a previous article I have talked about the 10 reasons you should use a personal budget, now we are talking about the reasons a personal budget fails to reach its purpose.

You know very well that a budget helps you plan from a financial perspective any activity you have and it gives you an objective image on your personal finances.

Most of the times, after we start using a personal budget, we end up failing to take it into consideration and it stops coinciding with the financial activities we make.

I have to tell you ever since the beginning that it is not easy to make a personal budget. The most difficult part is to stick to the plan.

Personal budget is a plan you make at the beginning of the month and you have to comply with it without any deviation. Most of the times, we see at the end of the month that we have failed to take it into consideration and that we have spent more.

Personal-budget

Before analyzing your own personal budget, let’s see what the main reasons for its failure are:

5 reasons why a personal budget fails

1. You have very high expectations!

Each time someone makes a personal budget, he/she has high expectations from it. It takes a while until you achieve your own personal budget.

At the beginning, as you are not used to it, you will see that the planned budget does not coincide with the achieved one and differences between them occur.

Do not get scared and do not lose motivation. It is normal!

A good budget is not created over night, or in the second night.

You end up having a budget after at least 6 months. After 6 months, while you were focusing a lot on your expenses and your income, and made a habit out of it, you can say that your budget is good.

Until then, take your time, do not lose motivation and give yourself as much time as necessary to plan your budget each month.

2. Personal budget is not at hand!

We are human. Humans generally forget. We are forgetting small things happening to us daily.

This can be a problem when it comes to organizing a personal budget.

If you are a forgetful person, I recommend updating your personal budget daily.

Give yourself 5-10 minutes each evening and update your budget. See what you have spent that day and how much money for spending you have left for the next days.

3. Maybe you are not using a budget model which is in your advantage

There are many budget models you can use. Some of them are online, some even directly on your phone, others in Excel.

I, for one, use a budget model in Excel, which I update each time I go to the computer. I am spending quite a lot of time at the computer and it helps me be in contact with it.

HERE you can find the budget model I use. It is in Excel and easy to use.

I recommend it with the utmost trust.

4. You are forgetting about the expenses for fun!

When we are planning our budget we are tempted to write absolutely all expenses for invoices, food, but we are forgetting the expenses for fun.

We are thinking that we will not have that much fun in that month and we write a small amount.

The reality is completely different. In reality, you go out each week (sometimes daily) and you are spending more than you have set.

It is crazy if you do not plan the expenses with fun. It is a very important category where the amounts can be very high if you are a “party person”.

5. You forget about the “Unexpected or extraordinary expenses” category

You have many expenses in a month. Many invoices, much shopping to do, you have many places to go to.

Once with these “many”, you will end up finding it very difficult to foresee them. Then, there are the extraordinary expenses, which you had no way to foresee, such as: something in your car breaks, the TV/phone/computer etc. breaks.

All these are expenses that can affect your budget.

Best solution: Add 10% of the total amount in the “Unexpected or extraordinary expenses” category.

This category will help you get off a lot of trouble without affecting your financial planning.

These are the most important 5 reasons why a personal budget fails. Make sure you are not breaking them and always take into consideration the 10 reasons you should use a personal budget.

In the end, I am waiting your opinion about why a personal budget fails.

Why do you think people cannot comply with their personal budget?

debt

41 Techniques That Can Get You Out of Debts. How to Get Rid of Debts!

I think that when you end up having debts is one of the most difficult moments of our life. We end up depending on multiple persons, persons depending on us and the stress grows limitless. How to get rid of debts? is the most important question…

Each day we think only about this and this is not helpful, in all situations, for getting rid of these debts.

Maybe the debt cannot be settled in a very short amount of time, but if you are willing to make more sacrifices than you usually do, your debt will be gone in a quite short time.

unsecured-debt

I will show you below a series 41 practical ways you can get rid of debts:

41 techniques that can get you out of debts

  1. Choose the right attitude. Do not let negative thoughts overtake your mind. Think positive.
  2. Make a list with all your debts (including bank credits, interests etc).
  3. Do not add more debts. Those you have are enough. Your task is much too difficult as it is.
  4. Find a second or a third job. Any additional income helps you pay your debt faster.
  5. Remove any other passive expenses you may have (the fully comprehensive car insurance must go, the savings for additional pension must be removed  etc)
  6. Analyze your assets. See what you need and what you do not need. Sell what you do not need!
  7. Think if you are using your cable TV or your internet at maximum level. If not, cancel them or have a cheaper subscription.
  8. Pay your smaller debts first. It is a psychological game called the Debts snowball.
  9. Try using cash. Do not use the card, because you lose a certain amount of money for each transaction. Give up cards for a while!
  10. Pay as much as possible from your debts each month! Do everything possible not to get rid of money quickly. The quicker, the lower the interest.
  11. If you receive a bonus/raise, use it to pay your debt.
  12. Make money out of your hobby. See what you like doing and try to make money out of that.
  13. Develop your financial management part. Use a personal budget to manage your money better.
  14. Make money out of affiliate marketing. Try selling goods online for a fee.
  15. Make a personal blog and try to make money out of it. If you are involved enough, you can end up making enough money out of advertisements or affiliate sales.
  16. Never miss a debt payment. Each missed deadline will bring penalties, namely amounts added to the debt.
  17. Evaluate your consumer behavior. If necessary, reduce consumption!
  18. Use a calculator or even your mobile phone when you go shopping so that you know when you have reached your limit. Thus, there are no surprises when you get to the cash register.
  19. Read books about financial education. They will help you figure out how to earn more, how to manage your money better and how to spend them “wisely”.
  20. Set your own income objectives. Tell them to a close friend or a family member, so that your responsibility grows. Usually, if you tell your objectives to people around you, it will be more difficult to give up on them.
  21. Celebrate any victory you had on settling your debts. It will help you motivate yourself more to get rid of debts. (Not by drinking. You can buy something you needed for a long time).
  22. Never lose heart. Always fight as if it is the last thing you do. Successes will not be late.
  23. Follow financial blogs. Keep an eye on the best blogs of this area and find out how others managed to earn more money.
  24. Stop eating out. This costs you more. Eating at home something you made is cheaper and healthier.
  25. Reduce your costs for going out. Try to watch movies at home or, when you go out, buy cheaper drinks. This does not need too many costs.
  26. Analyse your closet. Try to use the clothes you have and stop buying others. Buy clothes only if it is really necessary.
  27. Get rid of the smartphone. It costs quite a lot (electricity, internet etc). With it, you can get rid of the internet subscription. (only if it is necessary 🙂 ) For the moment, we can live without it.
  28. Do not buy expensive phones. Buy a phone for talking and a minimum set of activities. They are more efficient.
  29. Start a small business, in your free time. Ex: painting, pictures, babysitter, web design etc.
  30. Always ask your creditors how you can reduce the interest. Reducing this interest to the lowest amount leads to the reduction of the owed amount.
  31. Rent a room. If you are staying in an apartment, try living only in a room for a while, and the other room you can rent to other people.
  32. If you live in a rented apartment, try moving in the cheapest apartment or even in a studio. The utility expenses are much lower for a studio.
  33. Develop yourself a businessman mind. Buy things cheaper and sell them on olx.ro or on other websites with a mark-up.
  34. If you know a subject very well (ex. Maths, Romanian, Geography etc), give private lessons. You can earn somewhere around 30 lei for 2 hours.
  35. If you have a photo camera, take some artistic photos and sell them on ShutterStock.com. You earn money for every sale you make.
  36. Stay more hours at work if they are paid extra.
  37. Follow store sales. Buy products only if they are on sale.
  38. Take only the money you need out of your card at the beginning of the week. Forget it at home 🙂
  39. Participate at various contests. You never know when luck might show up and you win some money.
  40. If you have too high debts, uses refinancing. Interests can be lower than those you have now.
  41. Give up expensive vacations and parties. Try to stay at home and have fun with as least money as possible.

These were the ideas I had. Some are applicable for you, others are not. Try to make a list of 10-15 which might fit you. They are not all generally valid.

I wish this list continues up to 50 or 100, but I need your help for this.

If you know other useful and practical ways to help us get rid of debts, you can leave them in a comment below and I will add them to this list.

Commodity Gold

Commodity Gold Rates

Are all International Commodities sites/deals just SCAMS?

For example, just do a quick search for “Aurum Utalium”.

It seems you enter a world of seemingly scam-filled websites with people offering to sell or buy zillions of tons of every kind of commodity — Gold, Sugar, Iron, Wheat, Rice, Diamonds — you name it, and usually in quantities of Zillions of tons, for Bajillions of dollars, etc.

Is any of this stuff real? Are all of these websites just filled with people who are scammers looking for victims? All of ‘em? There are so many! Who are they? What exactly is the scam, if it is? How do they get away with it — it seems so public — any law-enforcement agency can just find these people, and seem to go along with one of their “deals” and catch them, right? It seems so easy, that it seems like they can’t all be scams, or it would just be a law-enforcement-agency-free-for-all, easy way to beef up their conviction rates or whatever.

What in-the-heck is going on??

Yes, they are all scams. There is no international, worldwide internet police force. They take your money, say, from America (you) to Nigeria (them) – there’s nothing you can do about it later. In the example I gave, I think Nigeria actually supports this kind of thing. The scammers have to give probably a huge kickback of the money they ‘make’ to the government.

Don’t you ever wonder why a poor country like Nigeria has bunches of people advertising scams on sooo many websites and – the main question is – where do these poor people get their computers and internet access from or through?
You are correct – their government.

Gold-Bullion

You can replace ‘Nigeria’ with a whole host of other countries – ‘China’ springs to mind quite readily. Their governments WANT people to do this! Good luck with trying to prosecute a Chinese scam website – you won’t even be allowed into the country, and if you do make it in, your case will have ROFL absolutely zero chance of being ‘heard’ – unless you consider it being ‘heard’ as you talking to yourself about it behind jail bars in some terrible province in China as you slowly starve and die of thirst. . .

Remember, China is still a Communist country with absolutely nothing in their law that states you deserve a fair trial.
————-
Oh yeah, (I’m still on China here) – they don’t allow people to access all of the gazillions of websites available. The government is in charge. They block almost every outside website claiming that such websites are ‘propaganda’. The truth is that they only want their LOL ‘citizens’ to hear THEIR OWN propaganda.

Basically, such countries WANT to keep their people in fear and also essentially uneducated. Kind of like sheep, you know.

Another country that does this is Iran – as if you couldn’t have guessed. They (all those nations) (for some unknown reason) believe that they will be a stronger country if they are rulers of uneducated masses of people.

Buying BHP and Rio tinto shares good during recession?

I know commodities go up especially gold and silver during recession. So I was wondering if own shares in BHP the largest natural resource company and rio tinto the largest mining company a good idea especially when inflation is rising at a faster then normal rate?
Inflation is not the worry it’s hyperinflation that I’m worried about. So having stocks like these my best guess would be a good idea.

Let’s straighten out some relationships and terms here.

First, commodities do not typically rise during a recession. A “recession” is a contraction in gross domestic production, meaning economic activity is soft, and price pressure (inflation) is low. In that situation commodity prices historically decline. We are not in a recession now. In fact the recession was declared officially over a few months ago. Don’t confuse this with unemployment. Sure, employment is important. But economic output in the US is expanding right now, despite high unemployment.

Commodity prices do tend to move up when inflation is rising. But we are not seeing inflation rising at a fast than normal rate right now. In fact some folks fear the possibility of “deflation” — which is a general decline in prices. Of course, there are others that believe that even though we have low inflation right now, we’re bound to see higher inflation in the future because of the massive government spending and “money printing” that is coming from Washington. That is probably behind much of the recent rise in commodities such as gold.

You should also recognize that gold is a somewhat special case, because it often trades as if it’s a currency alternative. This is probably a large factor in the rising demand for gold recently. People believe that currencies all over the world are weak and getting weaker, so the buy gold as protection.

Now to the factors behind BHP and Rio Tinto. These mining and resource companies are also benefitting from the rapid economic growth OUTSIDE the US — and especially so in China and other emerging markets. Industrial commodities such as copper are in increasing demand from these growth economies.

So, is owning shares of companies like these a good idea? I’d say yes. Is it a longer term play based on economic strength in emerging economies? Yes. If the US shows renewed economic growth that will only add to the demand.

Are we looking at inflation down the road? Probably. Is gold a good thing to hold as part of a portfolio as protection against that (and against currency weakness?) Most certainly. But is it also possible that interest rates rise over the next few years as the US economy strengthens? Yes. If rates do rise, so too will the dollar, and that will put pressure on gold.

So do you put all of your investment capital into commodity investments? Most certainly NOT!

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