Most young adults are clueless on how to manage their money and most often find themselves living an existence of barely managing from one paycheck to the next. Here are 5 financial tips for young adults that will leave you comfortable and prosperous.
Learn self control – It is important to learn the art of delayed gratification. Instead of buying an item on credit as soon as you want it, try saving up the money and buying something straight off. Use your credit card only for emergencies and for the special offers that they provide.
Take control of your own financial future – It is better to understand how to control your money better, than letting your family or friends dictate your financial future. Read a few books on how to make the most of your personal finances.
Know where your money goes – Budgeting is a very good way to understand where your money is being spent. Once you understand where your money is going, you will understand that making small changes can make a big difference at the end of the month.
Start an emergency fund – It is good to pay yourself first, so that you have some money saved in case of an emergency. Set aside a percentage of your earnings, which are transferred from your account automatically to a savings account every month.
Start saving for retirement now – Saving up now for your retirement, will mean that you will have a stable income once you get old and are unable to work
Until personal finance becomes a subject in high school or college every young adult needs to learn how to manage their finances. Unfortunately, most don’t and as a result go out into the world without any idea on how to manage money. Here are a few tips to get your started:
It is important to learn the art of delayed gratification. It will make managing your finances and saving money that much easier. Credit cards make it very easy to buy something immediately, even when you cannot afford it. Avoid those traps and only buy something that you have the money for. If not, then save up and buy it.
Setup an emergency fund
One of the smartest mantras in personal finance is “pay yourself first”. Regardless of how much your commitments are, always put away something. The starting point is your emergency fund. Set yourself a target of an emergency fund that will cover your expenses for three or six months. Once that target is hit, then look at other saving accounts.
Start saving for retirement
Thanks to compound interest, the sooner you start saving the less money you will have to contribute to hitting your retirement targets. The sooner you hit your retirement target the sooner working becomes optional and you can do anything else you want. Some companies provide retirement plans for their employees. This is beneficial as the money goes in pre-tax and some even match your contribution.
Small budgets are something businesses have to get used to when hiring new employees. Here are some tips to get the most for your money.
Know when to outsource – Outsourcing a position is a great way to reduce risks that come with a new hire. If an outsourced employee is not doing their job, you can simply tell them that you don’t require their services.
Use small to your advantage – Small businesses provide new hires with the ability to make changes that can be implemented. Make sure you highlight this fact when interviewing potential candidates.
Offer competitive non-salary benefits – Although employees are maybe willing to join a company for a smaller salary, you will have to offer them other benefits to keep them interested. For example, offering childcare services, transportation reimbursement, flexible schedules, the opportunity to work from home, are non-salary benefits that will keep employees happy.
Clearly set expectations – When the salary is low, it is best to discuss this at the early stage of the interview. The interviewer should then build on the other benefits the job offers.
Leverage existing employees – Ask employees to refer friends and acquaintances, so that they can market your company from the very beginning. This referral means that your employees will be more likely to introduce potential hires that are a great fit for the organization regarding culture and work ethics.
If your finances are a mess and your life goals are not being met, you may feel that you aren’t making the most of your life. Here are some ways to straighten your finances and reach those life goals you’ve always dreamed of achieving.
What do you owe – Understanding what you owe the bank is an excellent way to work towards paying off your debts. You can then look at how much money you will need to put away each month to pay up what you owe.
Learn accounting – Learning basic accounting will help you to budget and keep track of your expenses. You can then look at your budget each week and understand where you are spending your money the most and where you can save.
Transfer your income to your savings account – To grow your savings look at saving 5% of your income into a savings account every month.
Open an investment account – Investing your money wisely with the help of a reputed, experienced investor can be a smart move. Working with an investor will also teach you how to invest on your own and grow your investment.
Get an eBay account – Selling unwanted items that you own is an excellent way to get rid of junk and earn in the process. Start off by creating an eBay account and use your account to sell items on a weekly basis.
Initially following the tips above may seem complicated because your lifestyle will need to change. However, you will soon realize that within three months of following the steps above, you will increase your savings, reduce your debt and be able to reach your life goals.
An effective manager will have to communicate with his/her accounting and finance professionals team to ensure daily business activities and projects are completed as per the plan. Here are six tips that will help a manager effectively communicate with his/her finance department.
Ask them to speak up – Ask your finance team to be more vocal and request for their feedback, questions, and concerns.
Check in often – Often remind your accounting team that you value their input and need their expertise to ensure that the business runs smoothly.
Don’t catch people off guard – Avoid waiting till an annual appraisal to give your team feedback, as this will give no time for a staff member or team to improve. Look at informally offering regular performance reviews.
Give it to them straight – Accounting professionals will value a communication style that is honest, reliable and direct.
Be specific – Accounting professionals will focus on data, so if you want them to work on something ensure that you are precise, accurate and technical. Avoid being general and request for numbers that will help you understand the situation better.
Ward off rumors – Office gossip can confuse employees and create misinformation and half truths. When you’re speaking to the finance team, request for information in numbers as this will provide a more accurate picture of a problem.
Training – Adding training programs to help employees communicate better is a good way to help departments and managers communicate more effectively.
Small businesses are often tight on budgets and therefore should include energy saving methods to reduce their utility bills. Here are seven tools and tips for small businesses to save money on energy.
Increase the efficiency of your boiler – Upgrading and cleaning your boiler will improve its efficiency. Look at removing soot, scale and fixing leaks to reduce costs at your facility.
Insulate piping and ductwork – Pipping and ductwork done properly will reduce heat losses, saving energy and costs.
Replace inefficient lighting – Look at energy efficient lighting that will reduce your energy consumption and produce less heat.
Upgrade your AC – New air conditioners will use less than 50% less electricity than those used in the 1970s. Therefore, upgrading your AC can reduce your electricity costs by at least 30%.
Reduce fan speeds – Reducing your fan speed by one notch will reduce your energy consumption by as much as 30%.
Disconnect non-essential loads – If you have appliances like coffee makers, water coolers, vending machines and registers that are not in use, it is best to switch them on when needed or sell them to reduce your energy load.
Maintain your electrical distribution system – Look at a well-maintained electrical system that will distribute, protect electrical usage and reduce electrical energy usage. You will need a qualified electrician to assess your business to rectify any issues.
A start-up’s finance team is the key to ensuring a start-up stays a float. Building a finance team from scratch can be difficult. Here are some tips that can help you get started.
When should I add finance staff? – Your finance team should be hired as soon as possible, instead of expecting key players to take on this role. Avoid failing in this area as it can have serious
What positions should I fill first? – If the organization is a forward thinking one, it is best to look at a financial analyst first. However, if someone on your team is handling this area, look at investing in someone to manage payables and receivables. You could also start by hiring a CFO and then look at an accountant to handle day-to-day tasks. Afterward look at filling middle management positions like an accounting manager or a controller.
Previous startup experience needed? – Your candidates don’t necessarily have to have previous start-up experience, but they should be able to fill a role that will involve a lot of multi-tasking.
Contract or permanent staff? – The choice of selecting contract or permanent staff will depend on the market and the specific skills you are after. A combination of both is advisable to ensure you get the right resources you require. Start off by hiring for your immediate needs and then look at what areas need improvement.
Warren Buffett is one of the richest people in the world, and he has been an inspiration to many. Here are some wise words that will help anyone in business.
- “Someone’s sitting in the shade today because someone planted a tree a long time ago” – The lesson here is to look at the future and see what methods of investing, saving or spending can help you lead a more comfortable life or one that achieves your goals or dreams.
- “Only buy something that you’d be perfectly happy to hold if the market shut down for ten years” – Invest in businesses that are stable but look at holding your investment for the long-term. As your investment matures, keep an eye on it to ensure that it is still valuable and your original reasons to buy still apply.
- “Price is what you pay; value is what you get” – The price you pay for something and the value you receive from it are quite different. Therefore, it is important to buy stock that you believe is more valuable than the share price in the market
“Cash … is to business as oxygen is to an individual: never thought about when it is present, the only thing in mind when it is absent” – This lesson is an important one, Buffett understands the importance of keeping an “Emergency fund.” Your emergency fund will help you face financial challenges with ease and eventually when you come out of it; your business will be stronger.
Summary: Global money transfers are relied on more than ever in today’s economy. Here’s how it’s done.
One of the most pivotal components of today’s modern economy is the global money transfer system. As large-scaled businesses are continue to shift their focus on cutting costs by outsourcing work to contractors overseas, there’s a substantial increase in the amount of global transfers.
The Utilization of Online Wallets
One unique way of transferring money online is through the use of an online wallet. For some individuals, the wallet is either a checking or savings accounts. This allows the consumer to maintain a fair currency exchange rate when spending around the globe – essentially when one works with any merchant service that will accept credit cards online. Also, for businesses that send their employees to various countries, it’s also a significant factor in cutting costs.
Bitcoin: The Currency of the Future
Bitcoin is considered the most popular forms of crypto currencies. Furthermore, it’s also being utilized across the globe as we speak. With a complex algorithm system, money is safely transferred from country to country without duplication concerns. This is done similar to that of a merchant credit card processing system, but varies in the amount of keys that are assigned to each transaction. Already, the economy is witnessing a substantial increase in digital currency, and it’s only the beginning. It may become a universally accepted means of money transfer, but only time will tell.
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Summary: Passive income has become a popular market for those that want to earn money without putting forth much effort.
Passive income can be defined as money that flows in on a regular basis without requiring a substantial amount of effort to be put in. Now, the idea behind this is to make an initial investment and allow everything to fall into place. Afterwards, there’s minimal maintenance involved and one reaps the benefits. That being said, not all passive income opportunities are beneficial for you. For investors, you’ll want to build a solid portfolio, which means understanding which passive investing strategies are worth pursuing.
Real Estate Investments
The real estate market, despite its ups and downs, remains to be a preferred choice for investors that want long-term returns. Investing in rental property can provide a solid source of regular income that comes in on a monthly basis. On the other hand, the investor has to put a 20% down payment to purchase the property, but that may not be an option for those that aren’t saving regularly. Once the tenants are installed, there’s little to do but wait for the rent checks to start flowing in.
The P2P industry is barely a decade old, and the market has grown substantially within that time frame. Investors that want to help other while adding passive income to their portfolio tend to look to P2P lending for a golden opportunity.
There are fewer barriers to enter this market as opposed to other types of investments. Some P2P platforms will allow investors to fund loans with as little as $25. The road to success with P2P however, lies with diversification. Remember, you’re funding individuals that you don’t know. You’ll have to rely on their credit score and other information that’s made available to you. If they end up defaulting on their loan, your initial investment will be lost. This is why investors will strategize and invest in multiple loans to minimize their losses.
Bio: An entrepreneur by trade, Omar Amanat is a successful investor that has seen his fair share in the technology and finance industry.