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Apache is functioning normally

November 29, 2023 by Brett Tams

Inside: Tight on time or money? One of these mini savings challenge printables is perfect for you. With these free printables, you’ll be able to save more money in no time.

The concept of a mini savings challenge is all about making money-saving a fun and engaging process. It breaks down your broader financial goals into manageable, short-term targets that cumulatively will help you reach your long-term objectives.

Around here at Money Bliss, we are known for having the best money saving challenges. While they are super popular on Pinterest and Google, what matters the most to us is that people are actually using them and their lives are changing.

So, if that is what you are looking for, then you are in the right place.

We know that the personal savings rate is dipping into the lowest range since 2007-2008 financial crisis around 3.4%.¹That is alarming because many people are one step away from not being financially stable.

Let’s dig into those mini saving challenges to make an impact in your financial life.

This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.

Why is a Savings Challenge Beneficial?

A savings challenge, while enjoyable, serves a more significant purpose. It instills a sense of financial discipline and allows you to visualize tangible results.

By making saving a fun and rewarding game, you’re more likely to stay committed and motivated.

This is why my money saving challenges are so helpful for thousands of my readers.

How this Mini Challenge Works?

Mini savings challenges work on the principle of small, regular savings resulting in significant sums over time.

By following a set rule – such as saving a particular amount every week, or matching a specific spending habit with a savings deposit – these challenges make it easy and fun to grow your savings without feeling overwhelmed.

Popular Mini Savings Challenge to Save Money

I love that I am known as an expert in helping people save money. The reason is simple – I love a good challenge.

If you have the right mindset, then you can save money on your income.

1. $300 Mini Saving Challenge

Many of us dream about having a comfortable savings account, but it’s often easier said than done. However, with the $300 Mini Saving Challenge, you can start building that financial safety net one step at a time. This challenge aims to help you stow away $300 and note slight improvements in your spending habits.

The $300 Mini Saving Challenge works by asking you to save a small amount each day. The goal is to gradually increase the daily savings, making it less burdensome and more achievable to hit your target of $300. This challenge is perfect for beginners who are apprehensive about taking on substantial financial commitments all at once but still want to cultivate good money-saving habits.

Expert Tip: Utilize a savings tracker, whether it’s a traditional paper-and-pencil method or a digital app, to keep track of your progress.

Raisin

Simply select one of the high-yield savings products offered by their network of federally insured banks and credit unions to begin your savings journey.

You can open a free Raisin account in just a few minutes!

Compare Rates

2. $500 Mini Saving Challenge

Learning how to teach yourself to save is one of the hardest things for my readers to do. So, they love these easy milestone challenges

This $500 mini savings challenge is a simple yet effective strategy to begin accumulating a substantial nest egg. This challenge requires you to systematically set aside a predefined amount each day, week, or month, consistently working toward a $500 goal.

Expert Tip: For the $500 Mini Saving Challenge, set a weekly savings goal and commit to reducing unnecessary expenses to manage and accumulate your targeted amount effectively.

3. 10 Week Saving Challenge

Kick-start your savings journey with an invigorating 10-week savings challenge. This feasible initiative can boost your bank balance and cultivate a savings habit.

As James Clear states in his famous bestselling book, Atomic Habits, it takes 21 days to build a new habit.

The challenge will triple your dedication as you will be setting aside a predetermined sum each week for ten weeks. The amounts could steadily increase to enhance the yielded savings.

Week 1 – Save $10
Week 2 – Save $15
Week 3 – Save $20
Week 4 – Save $25
Week 5 – Save $30
Week 6 – Save $35
Week 7 – Save $40
Week 8 – Save $45
Week 9 – Save $50
Week 10 – Save $55

By the end of your 10-week tenure, you will have amassed a handsome total of $325! This challenge is particularly beneficial for beginners who are striving to enforce a strict savings regimen.

Then, you can move on to our popular 52 week money saving challenge and choose the proper amount for you.

Expert Tip: Use a calendar or a mobile application to track your savings and keep you motivated throughout the challenge.

4. Mini Birthday Fund

Like a little surprise gift to yourself, the Mini Birthday Fund Challenge is for those who want to ensure they have a little extra cash to celebrate their special day in style. This delightful savings plan can be started at any time of the year, but the closer to your birthday, the more urgent the catch-up.

The plan is intuitive. Choose a monthly savings goal—say, $20—and diligently tuck away that amount every week or month until your birthday arrives. Then, voila! You have a mini birthday fund to splurge on a rewarding gift or experience gift for you. My personal favorite is spa time!

This is self-care and financial discipline bundled into one smart package.

Expert Tip: You can modify the amount you need to save and the total you need to save.

Our Top Pick

CIT Bank

Hailed for its competitive APY rates and digital ease of use, GOBankingRates named CIT as one of the Best Online Banks for 2022.

Earn one of the nation’s top rates.

Pros:

Daily compounding interest.
No account opening or maintenance fees.
Your deposits are FDIC insured.
Deposit checks remotely.
Make transfers with the CIT Bank mobile app.

5. The Penny Challenge

The Penny Challenge further simplifies savings. Plus you will be AMAZED at how much you can save with this simple penny challenge.

Every day you will save one more penny than the day before, yes, just one more penny. That will equal $667.95 in a year.

You can collect all the pennies you acquire and store them in a jar. Once your jar fills up or you hit your 365 days, deposit the pennies into your savings account.

Note: Though the denomination is small, you’ll be surprised at how much you can amass over time. Remember that every penny counts!

6. 365-Day Nickel-Saving Challenge

The 365-Day Nickel-Saving Challenge is perfect for those who like a daily commitment. Start on day one with a deposit of $0.05, and each following day, add a nickel to the previous day’s savings.

By day 365, you will deposit $18.25, accumulating a total of $3339.75 for the year. It’s a manageable and rewarding way to save.

7. The Dime Challenge

The Dime Challenge is similar to the Penny Challenge but uses dimes instead. Though the denomination is small, you’ll be surprised at how much you can amass over time.

Each day you will save ten cents or a dime more than the previous day, by the end of the year, you will save $6,679.50.

Day 1 – Save $0.10, Day 2 – Save $0.20, Day 3 – Save $0.30, and continue for 365 days

Collect all your dimes in a jar, and when it fills up, deposit them in your savings.

10X Effect: This challenge can help you save more money, more quickly than the Penny Challenge because dimes are worth ten times as much as pennies.

8. Dollar Savings Challenge

The $1 Savings Challenge is all about setting aside every single $1 bill that comes your way.

This is a great challenge if you use the cash envelope method for budgeting.

Even if you do this for just three months, you can save up to $1,000. It’s simple — every time you find a $1 bill, put it in your savings jar. This method makes saving money entertaining and gratifying.

9. The $5 Challenge

The $5 Challenge is similar to the $1 Challenge, with just a slight increase in the amount. It involves saving every $5 bill you come across.

Once again, better for those who use cash. But, you still can transfer $5 at intermittent increments to a separate online savings account.

The money saved from this challenge depends on how often you use cash and the duration of your challenge. It’s a doable and straightforward approach to savings.

Raisin

Simply select one of the high-yield savings products offered by their network of federally insured banks and credit unions to begin your savings journey.

You can open a free Raisin account in just a few minutes!

Compare Rates

10. 25 Envelopes Challenge

Another popular choice is the 25 Envelope Challenge which is a simpler version of the 100 Envelope Challenge. You get 25 envelopes, number them from 1-25, and each day, choose an envelope at random and put in an amount equivalent to the envelope number.

By the end of the challenge, you will save $325 in less than a month.

This challenge makes saving money unpredictable and exciting, leading to substantial savings over time. Next, you can try the 50 envelope challenge.

11. The Spare Change Challenge

The Spare Change Challenge involves saving all your loose change in a jar or piggy bank. Once the container fills up, deposit the savings into your bank account.

You’ll be surprised at how quickly the change adds up! However, this challenge works best for those who frequently use cash.

Tip: Don’t be afraid to pick up spare change on the ground!

Our Top Pick

CIT Bank

Hailed for its competitive APY rates and digital ease of use, GOBankingRates named CIT as one of the Best Online Banks for 2022.

Earn one of the nation’s top rates.

Pros:

Daily compounding interest.
No account opening or maintenance fees.
Your deposits are FDIC insured.
Deposit checks remotely.
Make transfers with the CIT Bank mobile app.

12. Round Up Savings Challenge

The Round Up Savings Challenge is best suited for card users. Whenever you make a purchase, round the figure to the nearest dollar and deposit the difference into savings.

For instance, if you spend $17.50, round it up to $18 and save the remaining 50 cents. It may seem small but will accumulate over time.

Go Digital: You can easily do this with the Acorns app.

13. No-Spend Challenge

The No-Spend Challenge encourages participants to avoid spending any extra money beyond the essentials for a set time. This involves taking a “financial fast,” where any non-essential spending is put on hold.

As such, this is one of my personal favorites, especially for those new to budgeting. It really helped me grasp what I truly needed to spend money on and what I didn’t. The same is true for all of my readers. The savings from this challenge can be substantial.

You can tailor the time frame to your own liking — try a no-spend day, week, or even month. Learn more about the no spend challenge.

14. No Eating Out Challenge

A no eating out challenge serves as an excellent tool to realize your spending habits as it eliminates the often overlooked cost of frequently dining out, enabling you to save more than expected. Right now, the average person spends $166 per month with most average costs in the $10-20 range.²

Combating your habit of eating out can lead to considerable savings, hence the No Eating Out Challenge. Under this challenge, you commit to avoiding restaurants, takeaway, and delivery for a set period, typically a month. The money saved from not dining out is then transferred into your savings, leading to substantial amounts over time.

This challenge makes you conscious of your expenditure and allows you to understand the significant amount you can accumulate over a period, promoting better spending habits.

15. The Spending “Swear Jar” or “Bad Habit” Challenge

Implementing a swear jar or a ‘bad habit’ jar can serve multiple purposes effectively. Not only does it stimulate the accumulation of savings, but it also aids in the transformation of replacing a bad habit with a good habit.

The rule is simple – each time you indulge in a specified bad spending habit, like making an unplanned purchase, you deposit a set amount (like a dollar) into your “swear jar.” This challenge effectively boosts savings while reducing unwanted expenses.

This is a great tactic to reduce your variable expenses.

Bonus: Savings Percentage Challenge

Last, but not least, my personal favorite! Increasing your Savings Percentage challenge.

The Savings Percentage Challenge urges you to save a fixed percentage of your income, preferably 20% every month. By adjusting the savings percentage to your comfort level, this challenge provides adaptability and the potential for significant savings over time.

To encourage savings as a regular habit, increase your savings percentage by 1% each year or with any pay raises or expense reductions.

See how the saving percentages work.

Tips for Successful Savings Challenge

Tip #1 – Creating Your Savings Goals

Creating specific, measurable, achievable, relevant, and time-bound (SMART) savings goals is the first step to your savings success. Your goals could be anything, ranging from a weekend getaway to creating an emergency fund.

Having clear savings goals keeps you motivated, providing a sense of purpose and direction. Learn more about smart money goal setting.

Tip #2 – Establishing the Savings Timeline

Once you have your savings goal, establish a realistic timeline to achieve it.

If your goal is to save $1000 and you decide to save $100 per month, your timeline will be 10 months.
If you need to save $300 in 30 days, then you must save $10 a day.

Establishing a clear timeline helps you organize your savings efficiently and remain motivated in your journey.

Tip #3 – Automatic Savings

One area I always stress to my readers is to pay yourself first. This concept is to set money aside first when you get your paycheck.

Then, take it one step further and establish an automatic transfer from your regular account to your special savings fund each pay period or month. This way, you won’t have to remember to make the transfer yourself, and it becomes an out-of-sight, out-of-mind saving habit!

Tip #4 – Staying Motivated through the Challenge

Track your progress visually, say, by coloring a box each time you save is habit-worthy. Keep your progress chart somewhere easily visible. This practice makes tracking fun and keeps you encouraged to save more.

Our free resource library of printables is full of possible money saving challenge ideas!

Staying motivated throughout your savings journey is crucial. Plus, watching your savings grow over time can be incredibly satisfying.

Tip #5 – Adjust your mindset for Improved Savings

Achieving your savings goals is truly a mindset game. Instead of seeing savings as a subtraction from your income, adjust your mindset to view it as paying yourself first.

Moreover, remember not to beat yourself up over occasional slip-ups. Continue to focus on your goal and celebrate small achievements.

Every dollar saved gets you one step closer to your goal.

Extending the Mini Savings Challenge – What’s Next?

Once you have completed a mini savings challenge, take your saving habit to the next level. Assess your financial situation and savings goal to determine new challenges.

You could consider higher-value monetary challenges or extend the challenge’s duration. Remember, consistent saving habits can greatly impact your long-term financial health.

Maintaining consistency in saving money is a golden key to long-term financial health.

Here are our popular money saving challenges:

Regardless of the amount, the habit of regularly putting money aside significantly contributes to building considerable savings. Remember, it’s not always about how much you save, but how consistently you do it.

Consistently saving, even smaller amounts, can lead to substantial totals over time.

Download the Printable Savings Tracker

To make your savings challenge fun and interactive, download one of our free printable savings trackers. These printable trackers will help you visually track your progress, boosting your motivation.

Every time you save money, color in a box or check it off.

Seeing this visual representation of your savings grow is a fun, rewarding way to track your journey toward your financial goal. Once you reach your goal, start again and keep the momentum going.

**To access these free printable, you must subscribe to my newsletter and you will be emailed the password.**

Frequently Asked Questions (FAQs)

Yes, you can start a savings challenge at any time. There is no specified period or date to begin.

You can choose a day that suits you best and kick off your savings challenge. Remember, the important part is not when you start, but that you start – and consistently save.

Staying committed to your savings plan is primarily about discipline and motivation.

Personally, I visualize my financial goals and stay motivated by celebrating small wins. You can do the same thing.

Also, use a savings tracker to make your progress tangible and fun. Finally, involve family or friends in your savings challenge so you can motivate and encourage each other along the way.

Of the Mini Savings Challenges, Which Will You Try First

Embrace the journey of a savings challenge, enjoying the process just as much as the destination.

This is key to becoming financially stable. It’s not only about reaching your financial goal but also about developing lasting habits of financial discipline and stewardship. These mini savings challenges are a learning experience and remember, no matter the size of your savings, every step is a step in the right direction.

With the help of a mini savings challenge tracker, you can start small yet grow big in savings.

These mini challenges, though small-scale and manageable, can lead to a significant increase in your savings over time. More than that, they encourage the much-needed habit of saving regularly.

Get started on your savings journey, make it enjoyable, and watch your money accumulate over time.

Sources

FRED St. Louis Fed Ecomonic Data. “Personal Saving Rate.” https://fred.stlouisfed.org/series/PSAVERT. Accessed November 8, 2023.
US Foods. “The Diner Dispatch: 2023 American Dining Habits.” https://www.usfoods.com/our-services/business-trends/american-dining-out-habits-2023.html. Accessed November 8, 2023.

Did the post resonate with you?

More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!

Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.

Source: moneybliss.org

Apache is functioning normally

November 29, 2023 by Brett Tams

When it comes to supporting a charity, it doesn’t get much more convenient than donating at the card reader in the checkout line. But depending on your motivations and financial situation, it may not be the best approach.

More than two-thirds (68%) of Americans donate to charity at the register of retail establishments, according to a new NerdWallet survey conducted online by The Harris Poll Oct. 10-12. Some give because the cause is important to them, and others give because they feel guilty if they don’t. But whatever the reason, being thoughtful about your donations can ensure you’re giving without breaking the bank.

For customers, these donations likely look like an additional $5 or so on their total, or “rounding up” to the next dollar amount. In either case, the incremental giving adds up to hundreds of millions of dollars each year nationwide.

Many shoppers likely make the decision to donate in the moment. But thinking through why you donate ahead of time can help you make more informed decisions that align with your values and your financial goals.

Here’s how to decide whether you should give to charity on your next shopping trip.

Skip: If you want to have a significant impact and can give more

Small donations at the cash register may add up over time, but making a large donation could be more impactful for the recipient.

About one-third (32%) of Americans donate to charity at retail registers because the cause is important to them, according to the recent NerdWallet survey, and 26% because they like to be charitable. Donating at the register often means sprinkling a few dollars across numerous recipients as you go from store to store. If you want to have a bigger impact on one important cause, a larger donation can be a better fit.

Give: If a small donation suits you best

Donating $5 every few weeks on your grocery run may be easier on some budgets.

One-fourth of Americans (25%) say they give at the register because small donations don’t feel as costly, and one-third (33%) of Americans who donate at the register say they wouldn’t donate to charity at all if they didn’t donate at the cash register, according to the survey. If you already have your card out, small donations are convenient.

These campaigns work for that reason. Albertsons Companies Foundation, the charitable arm of the grocery store chain, raised $43.5 million for hunger relief at cash registers in 2022, according to Engage for Good, a marketing company that helps businesses and nonprofits raise money. That’s in addition to millions raised by the chain for Ukraine aid and other causes.

Skip: If you’re hoping for an easy tax break

Donating to charity can reduce your taxable income, but giving incrementally at the cash register can make claiming this deduction more difficult.

In order to claim a deduction for donations, they must be for a tax-exempt charity that is recognized by the IRS. Further, you must itemize deductions on your income tax return rather than taking the standard deduction. You’ll want to track these donations with documentation such as your credit card or bank statements. All of this is a lot to ask for a small donation at the register. If you want to deduct donations, direct contributions will be less of an administrative hassle.

Give: If it makes you feel good

Giving feels good, and feeling good can promote more giving. It’s a sort of generosity cycle.

A significant body of research supports that giving activates the brain’s reward system, which can lead to greater happiness. And the amount of happiness that comes from generosity isn’t dependent on the amount you give, according to a 2017 study in Nature Communications. In this way, giving small amounts not only adds up for the organizations, but also for the donors.

Skip: If it’s not in the budget

If your current financial situation has you cutting costs to make ends meet, don’t make it harder on yourself.

As we established, giving should make you feel good. But 13% of Americans say they donate to charity at the register because they feel guilty if they don’t, 10% say it’s easier than saying no, and 8% do it because they’re embarrassed to say no, according to the survey. A dollar here or there doesn’t seem like much when things are going well, but every dollar counts when you’re dealing with unexpected expenses, a job loss or other financial strain.

If donating to charity adds financial stress to your current situation, skip it. This isn’t the last time you’ll be asked.

METHODOLOGY

This survey was conducted online within the United States by The Harris Poll on behalf of NerdWallet from Oct. 10-12, 2023, among 2,096 U.S. adults ages 18 and older. The sampling precision of Harris online polls is measured by using a Bayesian credible interval. For this study, the sample data is accurate to within +/- 2.7 percentage points using a 95% confidence level. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact [email protected].

NerdWallet defines generations in the following way: Generation Z, ages 18-26; millennials, ages 27-42; Generation X, ages 43-58; and baby boomers, ages 59-77.

Disclaimer

NerdWallet disclaims, expressly and impliedly, all warranties of any kind, including those of merchantability and fitness for a particular purpose or whether the article’s information is accurate, reliable or free of errors. Use or reliance on this information is at your own risk, and its completeness and accuracy are not guaranteed. The contents in this article should not be relied upon or associated with the future performance of NerdWallet or any of its affiliates or subsidiaries. Statements that are not historical facts are forward-looking statements that involve risks and uncertainties as indicated by words such as “believes,” “expects,” “estimates,” “may,” “will,” “should” or “anticipates” or similar expressions. These forward-looking statements may materially differ from NerdWallet’s presentation of information to analysts and its actual operational and financial results.

Source: nerdwallet.com

Apache is functioning normally

November 29, 2023 by Brett Tams

In the past, investing was thought of as something only wealthy people did. And unfortunately, many people used this as an excuse to put off saving for retirement, saying they would do it when they earned more money.

But if you wait to start investing, you lose out on the benefits of compound interest and shortchange your retirement savings. So, it’s best to get started as soon as possible, even if you only have a bit of money to tuck away every month.

One of the easiest ways to invest money is by using micro-investment apps. This article will explain what micro-investing is, how it works, and six micro-investing apps we recommend trying out.

10 Best Micro Investing Apps

Micro-investing apps make it easy to get started with small amounts of money and learn the basics of investing. We’ve compiled a list of the best micro-investing apps on the market today. Whether you’re a beginner or a seasoned investor, you’re sure to find an app that fits your needs and investment goals.

1. Robinhood

Account minimum
Margin accounts,
ETF’s, crypto

Great for beginners!

Robinhood aims to make investing accessible to everyone, which is evident in the fact that the company doesn’t charge any commission or management fees.

2. Axos Invest (Formerly WiseBanyan)

Account minimum
New investors

or goal-based investing

You can get started with Axos Invest (formerly known as WiseBanyan) for just $1. The company doesn’t charge any trading fees for the most basic version. But if you upgrade to one of the premium versions, the company does charge fees.

3. SoFi Invest

Account minimum

$0 for Automated Investing

$1 for Active Investing
Active and Hands-Off Investors

SoFi is a well known brand in the personal finance space, and their investing app is another high quality product.

4. Plynk

Account minimum
$2 per month
New investors

Plynk is designed to guide your learning while you begin to invest. The Plynk app offers investors access to a selection of stocks, ETFs, mutual funds and four cryptocurrencies. And you can start investing with just $1.

5. Webull

Account minimum
Active traders and investors

Webull is a stock trading app offering free stock trading as well as free trades on ETFs, options and cryptocurrencies.

Webull also allows users to trade fractional shares, making it a great choice for micro investing.

6. Stash

Account minimum
$1 per month
New investors

or tax-advantaged
retirement accounts

Stash is another hands-off micro-investing app designed for beginner investors. After you sign up, Stash will ask you a series of questions to determine your tolerance for investment risks. You will be labeled as a conservative, moderate, or aggressive investor.

7. Public

Account minimum
(1-2% markup on crypto)
Young investors

Public.com is a blend of both investment and social media platforms. It’s designed for younger and socially oriented investors who would like to own fractional shares of stocks and ETFs.

8. Betterment

Account minimum
Low balance investors

Goal-based investing

If you’re looking for something a little more hands-on, then Betterment might be a suitable option for you. Betterment gives you the option to work with a financial advisor who can make investing recommendations.

9. M1 Finance

Account minimum
Experienced Investors

M1 Finance might be the best micro investing app for more experienced investors. It is ideal for those looking for customized investment portfolios with some automated options, as well as those looking to set up commission free retirement accounts.

10. Acorns

Account minimum
$1 per month
Hands-off investors

(e.g., College Students)

If you want a hands-off approach to investing, Acorns will be your best bet. After you sign up, you’ll connect your credit card or debit card to Acorns.

What is micro-investing?

According to one survey, more than 47% of Americans are not saving for retirement. When pressed about their decision not to invest, over 34% said they don’t have enough money to invest.

The basic premise behind micro-investing is that you only need a few dollars to start investing. When you use a micro-investing app, you invest in very small increments by buying fractional shares.

With a micro-investing app, you can invest as little as $5. And with micro-investing, you don’t have to know anything about the stock market. The money you save is put in a portfolio of stocks that the company creates for you.

Is micro-investing even worth it?

Micro-investing will not get you rich, and it’s not going to help you fund your retirement goals. For that reason, it’s easy to write micro-investment apps off as not being worth your time.

But every day you put off investing is one less day that your money can grow in the market. So, you can wait until you feel like you have “enough money,” or you can work with what you have today.

Here are just a few benefits of using a micro-investing app:

Invest with very little money: Micro-investing platforms allow you to invest, even if you only have $5 to spare. So if you can skip your morning latte, then you have enough money to give micro-investing a try.
Save it and forget about it: It’s hard to set aside money in a savings account. You know it’s there, and it’s easy to access and spend. With a micro-investing app, it’s easy to save your money and forget about it.
Build positive habits over time: Anytime you’re trying to build a new habit, it’s best to start small. Micro investing allows you to ease into investing, and you can start saving more money when you’re ready.

See also: How to Invest: A Basic Guide to Making Your Money Grow

Pros and Cons of Micro-Investing Apps

While it’s true that micro-investing provides many benefits, they’re not necessarily the right choice for everyone. It’s worthwhile taking the time to understand the all nuances before committing financially.

Pros

24/7 Access

Using a micro investing app allows you full access to your investment account around-the-clock. You won’t ever have to worry about opening hours or holidays getting in the way of your ability to monitor and manage your funds.

Easy Fractional Investment

Traditional investment in stocks and ETFs requires large amounts of funding, but micro investment means you purchase fractional shares quickly and easily. This means you can begin your investment portfolio with your spare change, rather than hundreds or thousands of dollars.

Low Account Minimums

Another factor which makes micro investment apps attractive are the low account minimums. Most micro-investing apps have $0 minimum balance requirements, so you can begin investing with as little as you wish.

Safety

As with traditional investment accounts, legitimate micro-investing platforms will be registered with the U.S. Securities and Exchange Commission. On top of that, all savings and checking accounts with micro investing companies are FDIC insured.

Cons

Fees Can Be High

Account fees can vary, so it’s important to watch out for this. Don’t assume that an account with low minimums will also have low fees. If you’re only investing small amounts, paying high fees might not seem like a good deal in the long term.

Limited Investment Choice

Most micro investment apps won’t allow you to handpick the stocks inside your portfolio. While you will have choice regarding which set portfolios you invest in, you’re less likely to be able to pick and choose specific stocks.

Won’t Change Your Retirement Plans

One thing to keep in mind is that using a micro investment app won’t do much to affect your retirement on its own. It’s more about learning good investment habits, and getting familiar with maintaining and growing a portfolio.

Features of the Best Micro-Investing Apps

So, how do you decide which micro investing app is the right one for you? We’ve compiled a list of the most important features below to help you know what to look for. The best micro investment apps will have the following qualities:

Ease of Use

Fundamentally, the best micro investment apps will be easy and intuitive to use. They are often free of the usual clutter and jargon of some traditional brokerage accounts. With simple, easy to navigate interfaces these apps should provide an enjoyable user experience for all.

Low Minimum Investments

Good investing apps should allow you to access the market with just a few dollars. This is possible because they’re designed to allow you to purchase fractional shares of ETFs and other assets. Not all investing apps will come with a low minimum investment, however, so be sure to check if you’re a low budget investor.

Diversified Investment

The best investing apps will provide users with the chance to invest in diverse portfolios which are automatically generated. Asset allocation and diversification can be challenging even for experienced investors, so this is a great feature of these apps.

When you’re starting out as an investor, the sooner you can learn about diversification the better. And these apps should make it relatively easy for you to both practice and learn about asset diversity.

Educational Tools

As most micro investing apps will be marketed to newcomers, education is an important factor. If you’re just starting out with investing, then the best micro investment app for you will likely provide a wealth of educational resources and advice.

Keep in mind, however, that most micro-investing apps won’t offer access to a professional financial advisor.

Recurring Transfers

The best investing apps allow you to easily set up automatic transfers from your bank account to fund your investment account. A recurring transfer can remove some of the human error involved in managing your account and allow you to quickly build up a habit of funding your account.

Additional Services

While some apps are minimalist and simple, others come with the option of additional financial services. In addition to brokerage accounts, some offer access to a savings or checking account, as well as IRA and custodian accounts. Depending on your own financial goals, an app with additional services might be worth the extra fees.

Final Thoughts

Micro-investing apps make it simple for anyone, even those with just $5 to spare, to begin investing in the stock market. The apps we’ve covered in this article provide a great starting point.

While micro-investing might not cover all your retirement needs, it’s a smart way to begin saving, especially if your budget is tight. The crucial thing is to start investing and gradually increase your contributions over time. This way, you’re setting yourself up for a better financial future.

Frequently Asked Questions

Which micro investing app has the lowest fees?

Among the micro-investing apps listed, Robinhood, Axos Invest, SoFi Invest, Webull, Public, and M1 Finance all offer commission-free trading, which means they do not charge fees for buying or selling stocks and ETFs. So, you can consider any of these apps if you’re looking for a platform with low fees for micro-investing.

Which app is best for small investments?

Choosing the best app depends on your own budget, needs and goals. The market for micro investment apps has grown rapidly, and there are a lot of different options out there.

The list we’ve compiled in this article are our top picks, and are among the best micro investing apps available. These apps make it easy and convenient to begin investing. They also provide various unique features, low fees, good customer support and educational resources.

Who should use micro investing apps?

Micro investing apps are a fantastic way to begin investing small amounts while you learn the ins and outs. But who will benefit the most from using these apps?

Beginner investors: These apps are perfect for young investors and newcomers because you only need a small amount of money to start.
Passive investors: Most of them are actually robo-advisors which invest on your behalf based on your needs and budget. This automated investing allows you to establish a diversified portfolio based on your goals that you can simply set up and forget about, letting it work away in the background.
Emotional investors: Automated investing means you can’t make rash emotional decisions based on market swings. Instead of constantly worrying about market performance, you just invest small amounts and build your portfolio slowly over time.

Can you get rich from micro investing?

Micro investing is primarily a strategy for saving and building wealth gradually over time. While it’s a valuable tool for starting your investment journey with small amounts of money, it’s important to have realistic expectations. It’s unlikely to lead to rapid wealth accumulation or “getting rich” in a short period.

How do I start micro investing?

Investing today is more accessible than ever before. Nevertheless, it still seems an intimidating world for those who have no experience or education. If you don’t know where to start, you can follow these steps to begin investing with confidence:

1. Decide Between DIY or Automated Investing

If you’re not yet comfortable choosing your own investments, and managing your own portfolio, you’ll want to start with robo-advisor investing. It’s totally normal for beginners to feel uncomfortable choosing stock to invest in, and automated investing is the safer option in any case.

2. Identify Your Investment Goals

This is often the hardest step for new investors, but it’s one of the most important. Figuring out your short and long term financial goals will help bring purpose and structure to your investment decisions.

Generally speaking, investing is successful when considered a long term project. You’re much more likely to find success with investments by holding stock long term, rather than trying to figure out when the best time to buy or sell is.

3. Determine Your Monthly Investment

The traditional advice is to save and invest 20% of your monthly income. With the rise of micro investing, however, you don’t even need to invest much to begin with.

It’s important to pick an amount you can reasonably commit to. Of course, you can always change your automatic investment amount, or just add on extra when necessary, but it’s always better to set it and forget it. Even if it’s a small amount, consistency and time and the key ingredients to good investing.

4. Choose an Account That Fits Your Goals

Once you’ve got your budget and goals determined, it’s time to choose a platform to begin investing with.

Keep in mind that you can always switch the platform you use for micro investing, use more than one, or even open a brokerage account. Just make sure to take all fees into account before you sign up and get committed.

Are there any limitations on the types of investments I can make with these apps?

Micro-investing apps typically focus on stocks, ETFs, and sometimes cryptocurrencies. While they offer a wide range of investment options within these categories, they may not provide access to more complex financial instruments like options, futures, or mutual funds.

Source: crediful.com

Apache is functioning normally

November 28, 2023 by Brett Tams

Learning how to budget money on a low income takes work, but it can pay off big if you start early. Here’s how.

November 28, 2023

Starting your first job after school can be exciting, but it also ushers in new challenges. One of the biggest hurdles is making sure you can cover all of your bills and living expenses with your entry-level income.

Taking the time to create a budget can reduce stress and set you up for long-term financial success, says Michela Allocca, founder of the personal finance blog Break Your Budget. Sticking to a budget on a low income in your 20s can get your financial life in order with the right mindset for planning.

Not sure how to budget money on a low income? Allocca explains what a budget is, why it’s important to have one, and how to stick to one—even on a low income.

Why budgeting for young adults is important (especially on a low income)

Creating a budget may not sound like the most exciting way to spend time when you’re young and adventurous. But Allocca says that putting in the work now will make it easier to reach your financial goals and avoid money stress in the future.

In short, a budget is a spending plan based on an individual’s income and expenses, Allocca says. “In its simplest form, it’s how you choose to allocate your funds over a certain period of time,” she says. “It includes the essential expenses that make up your cost of living, as well as your nonessential expenses such as eating out, entertainment, or travel.”

Allocca believes having a budget is helpful at any stage of life, but it’s especially important in your 20s. “Not only does it provide direction on where your money is going, but it draws your awareness to what you are spending your money on,” she says. “This level of awareness makes it possible to nip poor spending habits in the bud early on, as well as ensure the money you are spending is being directed toward things that matter to you.”

How to create a budget that works for you

Younger people are often looking to align their spending with their values, Allocca says, and creating a budget can make your financial dreams a reality. When you’re ready to create a budget, Allocca recommends taking the following steps:

1. Gather information

“First, start by bringing awareness to your expenses,” Allocca says. “Look back at how you’ve been spending pre-budget.” She recommends taking a look at your credit and debit card statements from the last three months. From there, you can figure out the categories, based on your monthly expenses, that you’ll need to allocate money to.

2. Pinpoint your spending

Next, identify what you’re spending on average for each of the various categories of your budget. “You can use your historical information as a guide from the statements you reviewed earlier,” Allocca says. This is especially helpful if you’re thinking about how to budget to pay off debt.

3. Adapt and adjust

No budget is perfect out of the gate, Allocca says. Rather than spending time making sure your budget is flawless, it’s more important to put it into action and iterate as you move forward. “It’s super normal for your budget to shift and change both throughout the month and over time,” she says. “If it’s your first budget, keep an open mind to adjustments, and don’t worry if you are over or under in a certain area at first.”

To build your beginner budget, Allocca recommends using either a budgeting app or a budgeting spreadsheet (her personal preference).

How to stick to your budget over the long run

Creating a budget is the first step toward building a healthy financial future, but sticking to a budget is crucial. Allocca shares some tips for budgeting for young adults, even those who have a low income.

Learn how to say no

“’No,’ is a full sentence,” Allocca says. “In your early 20s it can be easy to succumb to peer pressure or to feel like you need to buy things to keep up with an image. It’s okay to turn down plans if it’s going to stretch your finances too thin or if it just isn’t worth it.” Your future self will be rewarded for making those sacrifices early in adulthood, she says.

Keep your essential expenses as low as possible

Having fewer expenses will make it easier to stick to a budget. “The highest expenses you’ll have are rent and your car, if you have one,” Allocca says. “If you’re in your early 20s, get a roommate or two, and don’t buy or lease a car that is more than 10%-15% of your income.”

Prioritize your value categories

What expenses are most important to you? “You don’t need to do everything, and you don’t need to spend your limited income on anything that isn’t adding value to your life,” Allocca says. “In my early 20s, I prioritized my discretionary income on my gym and my restaurant budget because those two things added the most value to my life.” Or, if you’re learning how to budget to pay off debt, you should prioritize your debt payments in your budget to become debt-free.

How to adjust when your expenses outweigh your income

Allocca says that budgeting for young adults on a low income is very similar to budgeting on an average or even a high income. The formula stays the same, she says: Allocate your income to the appropriate categories.

“The challenging part of having a low income is that you have less wiggle room, which can make day-to-day decision-making a lot harder,” Allocca says. “Don’t let this intimidate you, because a budget shows you how to use your money. It’s designed to be a tool to help you.”

And if your expenses outweigh your income, you can either reduce your expenses or increase your income. “Unfortunately, there is no secret sauce to this problem; it boils down to the math,” Allocca says. “That being said, there are ways to go about this that don’t need to be super overwhelming or stress-inducing.”

First, look at your expenses. If this is your first budget, there are likely many ways to make cuts. Start with unnecessary expenses: What can you live without? Once you’ve trimmed the nonessentials, assess whether you can reduce any essential expenses—whether that means moving to a less expensive apartment or buying produce on sale.

Spending less is a great start, but you can only cut your expenses so much. “The other side of the coin is increasing your income, which isn’t as hard as you think,” Allocca says. She encourages people to pick up a side hustle, such as ride-share driving or delivering food to earn extra cash. “Think about skills you have that you can leverage to earn money online via freelance websites,” she says.

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Take control of your finances today

Budgeting allows you to get a handle on your expenses, spending, and financial goals. Having a budget in place early in adulthood helps you develop healthy financial habits—such as regularly adding to your savings account—and can reduce money-related anxiety, Allocca says.

But budgets are not a one-and-done exercise; your budget should evolve to adapt to your life situation and goals, she says. To stay on top of your changing priorities, try referring to a financial review checklist to ensure your budget is always aligned with where you are—and where you want to be.

Articles may contain information from third parties. The inclusion of such information does not imply an affiliation with the bank or bank sponsorship, endorsement, or verification regarding the third-party or information.

Source: discover.com

Apache is functioning normally

November 28, 2023 by Brett Tams

Gross Annual Salary	Estimated Maximum Monthly Rent
$25,000	$625 per month
$50,000	$1,250 per month
$75,000	$1,875 per month
$100,000	$2,500 per month
$125,000	$3,125 per month
$150,000	$3,750 per month

Keep in mind that this method might not be feasible for everyone to follow, especially in places like New York City, San Francisco, and Boston where rent is extremely high. For example, the average monthly rent in New York City is $5,600, meaning you would need an annual salary of at least $224,000 to follow the 30% rule.

If you live in a high-cost city and find this rule unrealistic for your scenario, you may want to consider following a different budgeting technique.

2. 50/30/20 Rule

The 50/30/20 rule is a technique that divides your after-tax income into three categories—50% toward needs, 30% toward wants and 20% toward savings. This method isn’t as straightforward since rent is a part of the broader “need” category.

Let’s walk through a step-by-step example to determine your rent budget according to the 50/30/20 rule:

Step 1: Determine 50% of your monthly income: If your monthly take-home pay is $6,000, then allot $3,000 per month toward needs.
Step 2: Add up your other expenses in the “needs” category: Other expenses in the “needs” category include minimum payments on loans, groceries, health care, car payments, and utilities. In this example, let’s say each month you spend $500 on groceries, $100 on health insurance, $150 on utilities, $20 on credit card bills, and $500 on a car payment, which totals $1,270.
Step 3: Subtract the other “needs” expenses from the total “needs” budget to determine your monthly rent: To determine your rent budget, you would subtract $1,270 from $3,000, which equals $1,730.

If, after using this template, you find that your rent budget is lower than you’d prefer, you can lower your other “needs” expenses to allot more money toward your rent budget. For example, you could get a more modest vehicle, shop at a more affordable grocery store, or take steps to lower your utility bill.

3. 70/20/10 Rule

Similarly to the 50/30/20 rule, the 70/20/10 rule divides your post-tax income into three different categories. With this technique, 70% goes to spending, 20% to saving and investing and 10% to debt repayment and donations. With this rule, rent is a part of the “monthly spending” category.

Here’s how to calculate your monthly rent budget according to the 70/20/10 rule:

Step 1: Determine 70% of your monthly income. If your take-home pay is $6,000, allocate $4,200 to the “spending” category.
Step 2: Add up your other monthly spending expenses: Let’s estimate that you have the same “needs” expenses as the example above, which total $1,270. Your monthly “wants” budget includes $250 on eating out, $200 on clothing shopping, $85 on a gym membership, $200 on entertainment, and $300 on travel. Your total monthly spending would equal $2,305.
Step 3: Subtract your monthly spending expenses from the 70% spending budget to determine your monthly rent budget: To determine your budget, you would subtract $2,305 from $4,200, which equals $1,895.

With this rule, you may have more wiggle room to increase your rent budget by cutting down spending on your wants. For example, you could reduce the frequency of eating out or spend less money on clothes to grow your rent budget.

Other Factors to Consider

Remember that there isn’t a one-size-fits-all approach to how much to spend on rent. When deciding between different rental options, consider how the following factors may add additional costs or offer savings opportunities:

Location: Consider the distance to places you frequent and how that might affect costs. For example, you might find that rent is $100 less further out of the city. However, if you drive to the city for work every day, gas money might eat at your cost savings. Not to mention the additional time it adds to your commute.
Amenities: Consider what amenities the apartment offers that could save you money on other parts of your budget. For example, an on-site gym could save you approximately $75 monthly on a separate gym membership.
Remote work: If you work from home, you might put your transportation cost savings toward your rent budget to allow additional space for a home office.
Utilities: Some landlords include utilities in the rent price, while others don’t. Since the average electric bill is $137, it’s important to take this factor into account.
Internet and cable: Consider whether your rent includes internet and cable. Some complexes may require you to purchase an internet and cable package.

How to Save Money on Rent

Due to rising rent costs across the U.S., staying within your rental budget can be a challenging task. Consider the following tips to save money on rent:

Get a roommate: As of February 2023, the average monthly rent for a one-bedroom apartment in the U.S. is $1,152, while the average rent for a two-bedroom apartment is $1,320, which means getting a roommate can save you $492 a month.
Sign your lease in the winter: Studies have shown that December through March are the cheapest months to sign a lease due to decreased demand during the winter season.
Negotiate with your landlord: If you’ve been a reliable tenant or have a strong rental application, you may be able to negotiate your rent. Keep in mind that you’ll likely have more luck negotiating with an independent landlord than a property management company.
Offer to pay upfront: If you have enough savings, offer to pay a few months to a year of rent up front in exchange for a discount.
Opt for a long-term lease: Many landlords prefer long-term tenants and will offer lower rates if you sign a longer lease.
Move to a cheaper area: Generally, rent is more expensive in cities compared to rural or suburban areas. However, If you want to live in an urban area, consider opting for a smaller, more affordable city like Tulsa, OK, rather than a large city like New York, NY.

Budgeting techniques like the 30% rule, the 50/30/20 rule, or the 70/20/10 rule can provide you with a guideline of how much of your income to spend on rent. Additionally, looking for ways to save on rent can help you reach your other financial goals.

Now that you’ve determined your rent budget, credit score is another factor to consider when apartment searching. Landlords and property managers will likely perform a credit check to help determine your ability to pay rent. Generally, your credit score should be in the “good” range (670 or above) to improve the odds of your applications getting approved. While you can get an apartment with bad credit, you might have to jump through additional hoops.

Unsure what your credit score is? Check your credit score for free today to make sure you’re ready to sign a lease.

Source: credit.com

Apache is functioning normally

November 28, 2023 by Brett Tams

Inside: The Penny Challenge is an easy way to save money every day. By making small contributions of pennies each day, you can easily save hundreds of dollars. Plus a free printable!

Mastering the art of saving can be quite daunting, particularly for individuals living paycheck to paycheck. The idea of setting aside large sums of money daily might seem intimidating, leading to inertia and a lack of progress in saving attempts.

However, the Penny Challenge creates a refreshing approach to saving. You are saving pennies!

Thus, it takes away the pressure of dealing with large figures, making the saving process more accessible and manageable. Starting with as little as a penny a day, this challenge silently builds a savings habit and a more positive money mindset.

Rather than feeling overwhelmed, you gain slow and steady momentum in your saving journey, eventually accumulating a significant sum of $667.95 in 365 days. This subtle method of saving demonstrates that even slight changes in financial behavior can lead to impactful results.

The simplicity of the Penny Challenge is its greatest strength, making it an efficient and easy way to kickstart your savings journey.

This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.

What is the Penny Challenge?

The Penny Challenge is a delightful saving endeavor that begins with saving just one penny on the first day. The idea is to incrementally increase your savings by one more penny every day.

So, on day two, you save 2 pennies, on day three, 3 pennies, and so on. By the end of the year, on day 365, you’d save $3.65.

All adds up to a substantial $667.95 by the end of the 365 days!

History and Popularity of Penny Challenge

The Penny Challenge, while not heavily documented, appears to have its roots prior to social media where people started sharing it as an easy and fun way to save. It rapidly gained popularity because of its simplicity and the significant accumulation of savings from mere coins.

Today, people from all walks of life participate in Penny Challenges, tracking their progress and sharing their successes online. It’s not only popular among individuals but also families, helping children understand the concept of saving.

How the Penny Challenge Works

Around here at Money Bliss, we have plenty of money saving challenges to install habits of saving money.

The Penny Challenge is a suitable strategy for beginners, and even seasoned savers, making a significant impact on one’s back account by the end of the year with over six hundred dollars with just pennies.

Daily Contributions: Saving a Penny a Day

The core of the Penny Challenge is rooted in daily contributions.

Starting with one cent on the first day, you’ll boost your savings by an additional penny each day.

This means you’ll end up with three cents on the third day, four cents on the fourth, and so on. Remember, each penny is a stepping stone to building your wealth, so no amount is too small to fit in your piggy bank.

This habit-building exercise is particularly beneficial for those just starting out or anyone looking to make the most of their loose change.

Penny Challenge Chart in Action

Day	Penny Savings	Balance
Day 1	$0.01	$0.01
Day 2	$0.02	$0.03
Day 3	$0.03	$0.06
Day 4	$0.04	$0.10
Day 5	$0.05	$0.15
Day 6	$0.06	$0.21
Day 7	$0.07	$0.28
Day 8	$0.08	$0.36
Day 9	$0.09	$0.45
Day 10	$0.10	$0.55

Don’t be fooled! Pennies add up over the course of the year!

Monthly Contributions: An Alternative Approach

If daily contributions seem daunting or easily forgettable, consider the alternative monthly approach. Instead of saving each penny per day, you can make a lump sum deposit each month equivalent to the total you’d save daily.

For instance, in January you’d put away $4.96, in February $12.74, and so forth. This approach lessens the daily burden and keeps your saving habit on track.

Month	Penny Savings	Balance
January	$4.96	$4.96
February	$12.74	$17.70
March	$23.25	$40.95
April	$31.65	$72.60
May	$42.16	$114.76
June	$49.95	$164.71
July	$61.07	$225.78
August	$70.68	$296.46
September	$77.55	$374.01
October	$89.59	$463.60
November	$95.85	$559.45
December	$108.50	$667.95

If you like simplicity and want to start on any month, this approach is for you! The assumption is you save for 30 days regardless of the number of days in the month.

Month	Penny Savings	Balance
Month 1	$4.65	$4.65
Month 2	$13.65	$18.30
Month 3	$22.65	$40.95
Month 4	$31.65	$72.60
Month 5	$40.65	$113.25
Month 6	$49.65	$162.90
Month 7	$58.65	$221.55
Month 8	$67.85	$289.20
Month 9	$76.65	$365.85
Month 10	$85.65	$451.50
Month 11	$94.65	$546.15
Month 12	$103.65	$649.80

Raisin

Simply select one of the high-yield savings products offered by their network of federally insured banks and credit unions to begin your savings journey.

You can open a free Raisin account in just a few minutes!

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Penny Challenge Variations

Great news! There are plenty of ways to maximize your savings deposit with one of the advanced strategies.

Modified Versions of the Penny Challenge: 26 Week and 52 Week Challenges

For those who wish to tweak the Penny Challenge to fit their lifestyle better, there are modified versions such as the 26 Week and 52 Week Challenges. Many people prefer this as they are paid on a biweekly basis for budgeting.

For the 26 Week variation, you’d start with the max you would save which is $3.65 on week one, and decrease the saving amount by one cent every subsequent week, ending with $95.04k.
Similarly, the 52 Week variation begins with saving 3.65 on week one and ends with $3.13 on the 52nd week. Thus, saving $179.67.

These modifications are ideal for shorter time frames or lower savings targets.

Reverse Penny Challenge & its Benefits

The Reverse Penny Challenge works in the opposite direction to the traditional method. It starts by putting away $3.65 on day one and then decreases the amount by one penny each day.

The primary benefit of this approach is that it gets the more significant amounts out of the way early. For some, this method might be more digestible, and it can be particularly beneficial for those who find their finances tighter towards year-end.

All of our reverse money saving challenges are extremely popular since you may lose motivation to the end or other unexpected expenses pop up.

Coffee Habit Backwards Reward Challenge

Let’s be honest… most of these savings amounts are less than your cup of coffee at Starbucks or your Amazon order.

So, on those days you choose to spend money on coffee or a just-because purchase, then you must deposit the same amount into your penny challenge funds!

It’s just pennies, right?!?!

Other Popular Money Saving Challenges:

Grow your savings account with one of the other popular money savings challenges!

Acorns

Invest spare change, invest while you bank, earn bonus investments, grow your knowledge and more.

Every purchase you make means an opportunity to invest your spare change! So coffee for $3.25 becomes a $0.75 investment in your future.

Get Started

Penny Challenge Free Printable

Downloading the free printable penny saving challenge is a beneficial next step!

To access the free printable, you must subscribe to our email list. Then, you will be emailed the password to our free library – full of many printables to help you on your money journey.

FAQs about the Penny Challenge

By participating in the Penny Challenge and putting one penny in a jar every day, increasing the amount by a penny daily, you would end up with $667.95 at the end of the year.

It’s a simple yet effective way to accumulate a substantial amount from seemingly insignificant daily contributions.

If you were to save exactly one penny each day for a year without increasing the amount, you would end up with just $3.65 at the end of the year.

In contrast, the Penny Challenge’s incremental daily savings can significantly boost to a handsome $667.95 a year.

Every Penny Counts: Significance of Small Savings

While a penny might seem insignificant, the Penny Challenge proves that even the smallest denominations can cumulate into a significant sum.

This challenge reinforces the age-old adage, “A penny saved is a penny earned.” Teaching us that regularity and persistence in saving, regardless of the amount, can make a meaningful impact. It’s a testament to the potency of small daily habits in shaping your financial future.

Diving headfirst into the world of saving can often seem daunting, but any type of challenge makes it approachable and fun.

Seeing the Penny Challenge through to the end provides more than just financial gains; it instills a powerful habit of saving and exhibits the enormous potential of minor daily contributions. Upon reaching your savings goal, not only will you feel a sense of accomplishment, but your brain will also crave the repetition of this gratifying experience, motivating you to save more and tackle larger financial goals.

Remember, the journey of a thousand miles begins with a single cent!

Check out these mini savings challenges!

Did the post resonate with you?

More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!

Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.

Source: moneybliss.org

Apache is functioning normally

November 28, 2023 by Brett Tams

Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations.

A financial hardship letter explains an unforeseen circumstance that has made you unable to make regular payments on a loan and requests a modification to help you get back on track.

No matter how well you prepare, many Americans will encounter times of financial hardship due to circumstances outside of their control. Events such as company layoffs, natural disasters, and divorce can throw a wrench in our finances, making us unable to pay our financial obligations.

Instead of falling behind on payments during difficult times, take a proactive approach to your finances. Sending a financial hardship letter to your creditor can help you salvage your credit score while you get back on your feet.

Read on to discover what these letters are, situations that warrant them, and how to write your own.

Table of Contents:

What Is a Hardship Letter?

A financial hardship letter is a correspondence you send to a creditor that explains why your current financial situation prevents you from making debt payments. After providing details about your hardship, such as the cause and timeline, request that the creditor provide a mutually beneficial solution.

Depending on your specific circumstances, you could suggest to your lender that they assist you by:

Suspending your monthly payments for the time being
Decreasing your payment amount
Lowering your interest rate
Pardoning overdue payments
Waiving penalties for late payments
Adjusting the terms of your loan
Resolving your debt for an amount less than you owe

For example, if you were recently injured due to an accident, you could ask the creditor to temporarily pause your payments until you recover.

What Is Considered Financial Hardship?

Since everyone’s situation is different, you may be wondering what qualifies as financial hardship. A financial hardship is any scenario beyond your control that makes you unable to pay for your living expenses.

Examples of financial hardships include, but are not limited to, the following:

Employment layoff
Pay cut
Home foreclosure
Decreased number of working hours
Job relocation
Natural disaster
Emergency event
Divorce or separation
Military deployment or transfer
Death of a spouse or family member
Incarceration
Serious injury or illness

As you can see, the examples above are out of your control. On the other hand, circumstances that creditors are not likely to deem as a financial hardship include:

Poor money management or overspending
Routine expenses
Voluntary employment shift
Purchase of a home
Decrease in property value
Payment of college tuition
Investment losses

How to Write a Hardship Letter

When writing your financial hardship letter, address it to the loss mitigation department of your lender. Include your contact information and loan number so they can identify your account. Write your letter clearly and concisely, following the instructions provided below.

1. Explain Your Hardship

Be honest with your creditor about the circumstances surrounding your hardship, but keep your explanation concise. Aim to keep your explanation under one page.

While you should include relevant details such as what caused the hardship and when it started, don’t include unnecessary information. For example, you might inform the creditor that you’re going through a divorce and the legal fees are causing financial strain, but you don’t need to go into the cause of the divorce.

Remember to be truthful—don’t exaggerate your circumstances or include inaccurate information.

2. Provide Documentation to Back Up Your Claim

Provide up-to-date and relevant documentation as evidence for the statements you make in the letter to bolster your claim. Documents the lender may want to review include:

Bank statements
Pay stubs
Tax returns
Medical bills
Employee termination letter
Divorce certificate
Military orders
Proof of incarceration

3. List Steps You’ve Taken to Alleviate Your Financial Burden

Let the creditor know the actions you’ve already taken to help improve your financial situation and pay your debt. Steps you might take include limiting expenses, selling personal items, or working a side gig to make extra income. This provides the lender with additional context and shows that you’re taking personal responsibility for your financial situation.

4. Clearly State Your Request

The purpose of writing a hardship letter is to request help from the creditor during your difficult time. Make sure to clearly state exactly the action they can take to assist you and how it will help you. Provide your proposed solution or a couple of suggestions the lender might consider.

5. State Your Commitment to Paying Your Debt

Conclude your letter with a statement expressing to the lender that you’re committed to paying your debt and finding a solution that works for both of you. Sign your name to the end to formally close the letter.

Financial Hardship Letter Template + Sample

Below is a hardship letter sample and template to help you get started. When using the template, make sure to enter your own information where there is bolded text.

Mary Smith

101 Cedar Road

Savannah, GA 31302

[email protected]

(912) 333-3333

11/01/2023

Harry Jones, Loss Mitigation Department of Georgia Bank

444 Peach Lane

Atlanta, GA 30033

Re: Account #10122467894231

Dear Harry Jones:

I am writing this letter to request assistance with my personal loan during a time of financial hardship.

Approximately two weeks ago, I was let go from my job due to company-wide layoffs. As a result, I have been unable to continue making regular payments on my loan. I have included my termination letter that proves the validity of my hardship.

While I have taken steps to increase my income during this time, such as babysitting and selling old clothes, I am still not able to make full payments.

I fully intend to pay off my loan and am requesting your help to get me back on track. I would like to discuss possible solutions such as temporarily pausing payments, lowering my interest rate, or any other option that might be available to me. I expect my hardship to be resolved in approximately three to six months, after which I can resume my regular payments.

I want to reiterate my intention to fulfill my financial obligation. If you have any questions or would like to discuss a solution, please contact me at (912) 333-3333 or email me at [email protected].

Thank you for taking the time to review my request, and I hope we can come to a mutually beneficial agreement. Your support during this time of financial hardship is greatly appreciated.

Sincerely,

Mary Smith

How to Get Through Financial Hardship

In addition to writing a hardship letter, here are some other tips to help you get through times difficult times and continue to reach your financial goals:

Create a budget: Use a monthly budget template to write down your monthly income, expenses, and debt to paint a full picture of your current financial situation.
Consider debt consolidation: If you have many different debts, debt consolidation can simplify your finances and help you pay your balance quicker and at a lower interest rate.
Limit unnecessary expenses: During difficult times, it’s important to only spend money on the essentials. Consider canceling subscriptions, reducing electricity use, and eating at home to save money.
Start a side hustle: Having multiple income streams can help mitigate financial burdens. Examples of side hustles include pet sitting, driving for a ride-share company, online tutoring, and joining a focus group.
Build an emergency fund: Aim to save three to six months’ worth of expenses as a cushion in case of a personal emergency or unexpected expense.

Writing a financial hardship letter can help you maintain a good credit score during a crisis. While navigating your situation, it’s important to continue monitoring your credit. To make this easier during times of stress, check your free credit report card to see what’s happening with your credit at a glance.

Source: credit.com

Apache is functioning normally

November 27, 2023 by Brett Tams

You try to set goals and stay on top of your finances. But sometimes life gets in the way and throws you off your game. You forget to pay a bill or accidentally overdraw your checking account — then kick yourself for getting hit with hefty fees.

Without an organized system in place, it’s easy to lose track of what’s coming in and going out every month. People with cluttered finances are more likely to miss payments, continue poor spending habits, and save less. Disorderly bills and budgets are not only stressful but can actually help drive you deeper into debt.

Organizing your money takes a little up-front time and effort but comes with a big payoff: It can help you live within your means, pay bills on time, reach your financial goals, and build wealth over the long term. Keeping track and organizing your finances also gives you a better sense of control over your financial life.

And, it’s not that hard to do, especially if you break the process down into small, manageable steps. What follows are eight effective ways to keep your finances organized and in check.

Whether you’re aiming to save for a big purchase, build an emergency fund, or invest for the future, a structured approach to managing your finances can make a significant difference. The following steps can help you stay on top of your financial life and save you money in the long run.

Having a few clear, realistic financial goals is essential for staying organized. Knowing what you want to accomplish in the next months and years can guide your financial decisions. You can break down goals — like paying down debt, going on vacation, or putting a downpayment on a home — into smaller tasks and set deadlines to track your progress. This strategy can help motivate you to stay focused and disciplined with your finances. For example, brown bagging lunch might not feel like a pain if you have your sights set on a winter getaway to Mexico.

One of the fundamental pillars of financial organization is creating a budget. Having a basic plan for spending and saving can lead to more financial freedom and a life with a lot less stress. Start by assessing how much, on average, is coming in and going out of your checking account each month. If you find that your monthly outflows tend to equal — or exceed — your monthly inflows, you’ll need to rejigger your spending.

There are all different ways to budget — the best approach is simply the one you’ll stick to. One simple framework is the 50/30/20 budget, in which you divide your monthly take-home income into three categories, spending 50% on needs, 30% on wants, and 20% on savings and extra debt payments. Once you have a budget in place, it’s a good idea to periodically check in and make sure you’re sticking to the plan.

There are a number of personal finance apps that are free to use on your phone and make it easy to organize your money. Basic budgeting apps, like Goodbudget, EveryDollar, and PocketGuard, allow you to connect with your financial accounts (including bank accounts, credit cards, and investment accounts), track spending, and categorize expenses so you can see where your money is going. Regularly reviewing your expenses will help you determine if you’re sticking to your budget plan, as well as identify any unnecessary costs and areas where you can cut back.

Automate Bill Payments

One way to make sure you always pay your bills on time is to automate the process. You can do this by setting up automatic payments for recurring bills, such as rent or mortgage, utilities, insurance premiums, and loan repayments. Simply log into each account and authorize the provider to debit your checking account or charge your credit card each month. Alternatively, you can use your bank’s online bill pay service. Just be sure to keep track of the payments you have automated, so you know when to stop them or update credit cards.

5. Put Saving on Autopilot

If you wait until after you pay your bills and do all your spending to move money into savings, you may not have anything left to transfer. Why not pay yourself first? Also known as automating your savings, this organizational step ensures you are always working towards your goals.

Simply set up an automatic transfer for a set amount of money from checking into a savings account each time you get paid. It’s fine to start small — since the transfer happens every month, even small deposits can grow to a significant sum over time. If you want to earn a competitive rate and pay the lowest fees on your savings, consider storing this money in an online savings account. Thanks to reduced overhead, online banks are typically able to offer more favorable returns than national brick-and-mortar banks.

💡 Quick Tip: Want a simple way to save more everyday? When you turn on Roundups, all of your debit card purchases are automatically rounded up to the next dollar and deposited into your online savings account.

6. Manage Mail as Soon as It Arrives

Despite living in a digital world, many important bills and documents likely still arrive in your regular mail. This might include stock statements, property tax bills, homeowners’ insurance bills, and medical bills. As a result, you’ll need a system for managing paper bills and statements. Generally, the most efficient way to deal with mail is to organize it as it comes in. You might create three “in” boxes or files labeled: “to pay,” “to file,” and “requires action.” Set a day and time each month to go through these boxes to make sure nothing gets ignored.

7. Organize Your Online Accounts

You likely have a number of online accounts — including bank and brokerage accounts, service provider accounts, and shopping accounts — each with a unique (a.k.a, hard-to-remember) password. It’s a good idea to make a list of all of your online accounts, including usernames and passwords, and keep it in a notebook stored in a safe place. Even better: Consider using a password manager tool, such as Dashlane, 1Password, or Apple’s built-in Keychain. These tools will start saving the passwords you use to log into your accounts and will automatically insert them into log-in forms. Typically, they will also generate hard-to-guess options when you sign up for new sites (no more “123456”).

Recommended: 11 Tips for Cleaning Up Your Finances

8. Make a Plan to Manage Debt

If you typically pay just the minimum on your high-interest debt, like credit cards, you are likely spending a lot on interest, while never getting ahead on your debt. Coming up with a system to knock down — and eventually eliminate — high-interest consumer debt can help you save money and make it easier to reach your financial goals.

To get a better handle on your debt, you may want to make a list of all your high-interest debts, including amounts owed and interest rate. Then focus your efforts on erasing one debt at a time while still making the minimum payment on all other debts. Where to start? You can use the debt snowball method and start with the smallest balance first, or use the debt avalanche method and pay down the highest interest debt first.

The Takeaway

If it feels like your money is all over the place and you’re living paycheck to paycheck without a plan, don’t get discouraged. You can get your financial act together one step at time.

By implementing some basic systems — like setting goals, creating a budget, automating payments and saving, and using an app that tracks your spending —- you can gain control over your finances and pave the way for a more secure financial future. Remember, financial organization is an ongoing process that requires consistent effort, but the rewards of financial stability and peace of mind are well worth it.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with up to 4.60% APY on SoFi Checking and Savings.

FAQ

How do I organize my personal household finances?

You can organize your personal finances by setting up a budget and putting some simple systems in place. You might, for example, put all of your regular bills on autopay so you don’t accidentally miss a payment and get hit with late fees. It’s also a good idea to automate savings by setting up a recurring monthly transfer from your checking account into your savings account right after you get paid.

For statements and bills that still come by regular mail, consider setting up an organization station with three in-boxes: “to pay,”“to file,” and “requires action.” Set a day and time each month to go through these boxes to make sure nothing gets ignored.

How do I organize my monthly bills?

Start by making a master list of all of your regular bills, including the provider, billing amount, and due date. To simplify payment (and avoid late payments and fees), consider setting up autopay for each bill. If you prefer to handle payments yourself, set aside a day and time each month that’s dedicated to bill paying. A structured schedule will help you meet all of your deadlines. An alternate approach is to pay each bill as soon as it comes in, then file it away.

SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet..

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.

The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOBK1023020

Source: sofi.com

Apache is functioning normally

November 25, 2023 by Brett Tams

If you’re learning about the investing world, you might come across the term ‘index fund’ as they are a trendy way to invest these days.

Investing powerhouses like Warren Buffett and Tony Robbins wholeheartedly recommend investing in index funds. In fact, LeBron James recently asked Buffet for investing advice on CNBC, and Buffett said James couldn’t go wrong with investing in them for 30 or 40 years.

What is an index fund?

An index fund is a type of investment vehicle, available as either a mutual fund or an exchange-traded fund (ETF), that is designed to track a specific financial market index. Its goal is to replicate the performance of indices like the S&P 500 or Dow Jones Industrial Average.

How do index funds work?

Index funds achieve their goal by mirroring the composition of the index they track. This involves including a range of stocks or bonds in their portfolio that match those in the index, providing investors with diversified market exposure. The fund’s performance is directly tied to the performance of the tracked index, offering a balance of risk and return influenced by the overall market segment.

Index Funds vs. Mutual Funds vs. ETFs: Understanding the Differences

Index Funds: The Basics

Index funds are passively managed and aim to mirror the performance of a specific market index. They offer a diversified portfolio at a low cost, aligning closely with market returns.

Mutual Funds: Active Management

In contrast, mutual funds are often actively managed. Fund managers actively buy and sell stocks or bonds, attempting to outperform the market. This strategy incurs higher fees and presents a greater risk, but also the potential for higher returns.

Exchange-Traded Funds (ETFs): A Hybrid Approach

ETFs combine features of both index funds and mutual funds. Most ETFs are passively managed, like index funds, but they trade on stock exchanges, similar to individual stocks. This provides greater liquidity and trading flexibility. ETFs generally have a lower expense ratio than mutual funds and offer tax efficiency due to their unique trading structure.

Key Differences in Trading

A significant difference between index funds and ETFs is their trading mechanism. Index funds are traded at the end of the day based on their net asset value (NAV), while ETFs are traded throughout the day at market prices, offering more flexibility for investors.

Understanding Key Stock Market Indexes

Before delving into the world of index funds, it’s crucial to understand the benchmarks they often aim to replicate. Stock market indexes like the Dow Jones Industrial Average, S&P 500, Nasdaq Composite, and Russell 3000 serve as key barometers for the overall health and trends of the financial markets.

These indexes, each with their unique characteristics and components, are essential in assessing market performance and guiding investment strategies. In the following section, we will explore each of these prominent indexes in detail, shedding light on their significance and how they influence the composition and performance of various index funds.

Dow Jones Industrial Average

The Dow Jones, often simply called the Dow, is one of the oldest and most well-known stock market indices in the United States. It tracks the performance of 30 large, publicly-owned companies listed on the New York Stock Exchange (NYSE) and the NASDAQ.

The Dow serves as a barometer for the overall health of the U.S. stock market and includes leading companies across various industries, such as technology, finance, and consumer goods.

S&P 500

The Standard & Poor’s 500, commonly known as the S&P 500, is a broader stock market index compared to the Dow. It includes 500 of the largest companies listed on U.S. stock exchanges.

The S&P 500 is widely regarded as the best single gauge of large-cap U.S. equities and is used by investors as a benchmark for the overall performance of the U.S. stock market. The index is diverse, covering multiple sectors, which makes it a popular choice.

Nasdaq Composite Index

The Nasdaq Composite Index represents over 3,300 companies listed on the NASDAQ stock exchange, a global electronic marketplace for buying and selling securities.

This index is heavily weighted towards technology companies, making it a popular measure of the performance of the tech sector. It includes not only large-cap companies but also smaller, innovative firms, reflecting a broad spectrum of the tech industry.

Russell 3000

The Russell 3000 Index is a market-capitalization-weighted stock market index that aims to be a benchmark of the entire U.S. stock market. It tracks the performance of the 3,000 largest publicly-traded companies in the United States, which represent about 98% of the investable U.S. equity market.

The index is comprehensive and includes both large-cap and small-cap companies, offering a broad view of the U.S. stock market. The Russell 3000 is further divided into the Russell 1000 (large-cap companies) and the Russell 2000 (small-cap companies).

Pros and Cons of Investing in Index Funds

Pros:

Diversification: By investing in an index fund, you gain exposure to a broad array of securities, which mitigates the risk of focusing too heavily on individual stocks or sectors. This diversification is a key advantage, especially for risk-averse investors.
Cost-effectiveness: Index funds are known for their lower management fees, as their passive strategy requires less intervention and research, making them a cost-efficient choice for long-term investment.
Ease of use: These funds are straightforward, ideal for both novice and experienced investors. They eliminate the complexity of selecting individual stocks, providing a simple yet effective investment option.
Consistent returns: Historically, they have demonstrated a consistent performance, often rivaling or surpassing actively managed funds, especially when considering the impact of lower fees over time.

Cons:

Capped growth potential: While index funds aim for market-matching returns, this approach limits the potential for significantly outperforming the market, a possibility in more aggressive investment strategies.
Vulnerability to market shifts: Being tied to market indices, index funds are subject to the ups and downs of the market. During market downturns, these funds will also experience declines.
Static strategy: The passive nature of index funds means they don’t capitalize on short-term market opportunities that active managers might exploit, leading to potential missed gains.
Performance deviation: Some tracking error is possible in index funds, where the fund’s performance might slightly differ from that of its benchmark index, due to various factors like fund expenses or timing issues.
Overconcentration risk: Certain index funds, especially those weighted by market capitalization, may have significant exposure to larger companies, potentially overlooking smaller, yet promising, market segments.

How to Invest in Index Funds

Investing in index funds can be a straightforward process if you follow these steps:

1. Define Your Investment Goals

Consider what you aim to achieve with your investment in index funds. Are you seeking long-term growth for retirement, or are you interested in short-term gains? Understanding your financial goals will guide your choice of index funds.

2. Conduct Thorough Research

Research various index funds to find the one that best matches your investment goals. Look at factors like company size, geographic focus, industry sectors, and asset types. Remember, even a broad market index fund can offer ample diversification, as suggested by investment experts.

3. Choose the Right Index Funds

When selecting an index fund, prioritize low costs. Even small differences in fees can significantly impact long-term returns. Compare funds with similar objectives, and pay attention to their management costs.

4. Select a Purchase Platform

Decide whether to buy index funds directly from a mutual fund company or through a brokerage. Also, consider ETFs, which are similar to mutual funds but trade like stocks. Assess factors like fund selection, convenience, trading costs, and availability of commission-free options.

5. Make Your Purchase

Open an investment account (such as a brokerage account, IRA, or Roth IRA) to buy shares of the index fund. Determine the amount you want to invest based on your budget and the fund’s share price.

6. Monitor Your Investments

Regularly review your index funds to ensure they are performing as expected and align with your investment goals. Keep an eye on the fund’s fees and performance compared to its benchmark index. Adjust your investments if necessary.

Final Thoughts

Many financial experts, like Warren Buffett, highly recommend index funds as a way to invest. They offer the advantage of being liquid assets, and it may not require a significant amount of money to begin investing in them. Furthermore, as mentioned previously, they typically have low fees.

Index funds are also a conservative way to invest. Because they follow indices made up of many companies, you spread out the risk. If one company in the index has a terrible week, chances are there’s another company doing well enough to balance it out. When you invest in individual stocks with just one company, you don’t have that cushion if a company starts to do poorly.

Of course, as with any investment decision, do your research. Learn as much as you can about them and the costs associated with buying them before investing.

Frequently Asked Questions

Are index funds a safe investment option?

Yes, they are generally considered a safe investment choice. They offer diversification by tracking a broad market index like the S&P 500, which spreads risk across various stocks. This means if one stock underperforms, others may balance it out.

Additionally, their low expense ratios make them a cost-effective option. While no investment is risk-free, index funds tend to provide stable, consistent returns over the long term, making them a favored choice for many investors.

What is the average rate of return on index funds?

There are many index funds, so it’s impossible to list the rate of return as a whole. You can research the history of a particular index fund to see the returns in a specific year. However, it’s more beneficial to look at returns over the long term.

Historically, the market as a whole averages from 7-10% in returns. Some years, like during the 2008-2009 recession, show terrible returns, while others show spectacular returns.

Can you lose money with an index fund?

Yes. When you buy an index fund, you’re investing in the stock market. The market is unpredictable. You could lose money one day and earn money the next. Either way, financial experts still point to index funds as a good investment option, as they usually have substantial long-term returns and low expense ratios.

What is the best index fund?

There are many top-rated index funds. Of course, the best one depends on the timeframe in which one measures it. However, there are some that have shown a strong rate of return with low fees. Here are some examples:

Schwab S&P 500 Index Fund
Fidelity Spartan 500 Index Investor Shares
Vanguard 500 Index Fund Investor Shares
Vanguard Total Stock Market Index
Fidelity Total Stock Market Index

Again, no one knows which funds will perform the best in any given year. However, some of the companies listed above are known for low fees and solid financial products. Take your time to research the best brokerage company for you. Some require very little money to start investing, while others might require a lot more.

How do you make money with an index fund?

You earn money from an index fund primarily through capital gains and dividends. As the fund’s underlying stocks or bonds increase in value, the value of the fund rises, leading to capital gains.

When you sell your fund shares at a higher price than you bought them, you realize these gains. Additionally, many index funds distribute dividends received from the stocks within the fund to shareholders, which can be reinvested or taken as cash payouts.

Can I invest in index funds with a small amount of money?

Yes, you can invest in index funds with a small amount of money. Many of them have low minimum investment requirements, making them accessible to investors with limited capital.

Source: crediful.com

Apache is functioning normally

November 25, 2023 by Brett Tams

There’s no better way to celebrate this festive season than by taking a step towards unlocking the door of dream house. This festival, benefits from Tata Capital’s Festival Home Extravaganza with swift approvals, smooth transactions and, most importantly, the smiles of loved ones when someone buys or begins constructing the dream home the buyer’s family deserves.

Tata Capital home loans bring an affordable and convenient way of financing dream.

Tata Capital home loans

Tata Capital provides personalized home loans that empower customers to realize their dreams of buying or constructing homes. With the flexibility to choose loan amounts, convenient repayment EMIs, and flexible tenures, customers can tailor their home loan experience.

Being secured loans, Tata Capital’s home loans do require customers to offer property as collateral against the loan. Further, to facilitate a smooth experience, the company provides minimal documentation and quick approvals to get started on building or buying a safe space for buyers and families.

The completely digital application process, accessible through the Tata Capital home loan website, allows customers to apply for their home loans without leaving the comfort of their homes

Why choose Tata Capital’s home loans

With a Tata Capital home loan, customers make their festivities a true celebration. Here is why one should consider applying for a home loan from Tata Capital.

1. Multipurpose loans

Tata Capital home loans aren’t restricted to just buying a property. These convenient loans can also be utilised to buy an under-construction or ready constructed house. Further, customers can also avail of this loan to buy a plot and construct their dream home on it.

Not only that, one can also use home loan to renovate existing house and even transfer outstanding house loan balance.

2. Flexible loan tenure

With Tata Capital home loans, one gets unmatched flexibility in managing financial affairs. Customers can choose their loan tenure depending on their repayment capacity and financial goals. The company’s loan tenures range from 5 to 30 years to help keep EMIs within a comfortable budget.

3. Attractive interest rates

Tata Capital prides itself on offering one of the most competitive interest rates available in the market. Further, on the basis of loan eligibility, credit score, income and other factors, the company will discuss the best home loan interest for individual application as well.

4. Easy eligibility criteria

The company’s easy-to-meet home loan eligibility criteria make home loans especially favourable. As part of loan approval process, the company examines a candidate’s age, income, credit score, employment stability and the like. Customers can learn the maximum loan they can apply for by using home loan eligibility criteria, available on the website.

5. Quick application processing

With Tata Capital, home loans get processed quickly and efficiently.

6. Instant approvals

All it takes is a couple of simple steps on one’s part, and Tata Capital home loan is on its way.

References

Source: businesswireindia.com