It’s that time of year. Time to start mapping out your spending for the holiday months where people usually overspend on dinners and shopping.
The holidays are a special time of year for sharing good cheer, great food and generous gifts with the ones we love. This year we have to celebrate in a different and safe way but spending will still take place. Before you map out your Black Friday and Cyber Monday shopping or the small holiday gathering even via Zoom, consider these 5 tips to save money this holiday season.
1. Create a holiday budget or spending plan
When it comes to the word “budget” many people often think of complicated spreadsheets and restrictions but no, no, no - a budget will help you plan your spending and ensure there no surprises at the end of the year. No matter how big or small your holiday spending budget, ensure it is realistic. Comparison shop around to find the best prices for the things you want to buy.
2. Make a list
Shopping for the ones you love can lead to overspending. All of the sales will exciting and tempting - trust me I know. To help avoid going over budget make a shopping list. On your list include the individuals you plan to shop for and a budget for each person. This will also help you narrow down the gifts options. You can actually get very granular and add the actual planned gift to the list so there isn’t room for overspending. You can also use budget envelopes for your shopping, one for food, one for gifts, etc…
3. Start early
Don’t miss out on savings by waiting until the last minute to do your shopping. Starting early will help you stick to your shopping list and allow you to shop around for the best deal and not pick up what is left since you started late.
4. Unused gift cards
Check your wallet to see if you have unused gift cards or ones with small balances. You would be surprised how this can help you fund your holiday shopping. Example: small balances on several Starbucks gift cards may be enough to get a gift from Starbucks for a boss or coworker.
5. Unconventional gifts
Try printing a photo of you and your best friend, child, parent, spouse then get a frame and a blank card (you can get both of these at Dollar Tree) and handwrite a heartfelt message. Another idea is a wall or desk calendar with pictures of the family for each month for a family member you don’t see often, along with a blank card with a heartfelt message.
Making your money stretch during the holidays comes down to preparation. Set your budget or make a plan and start early and you can avoid excessive spending and bring in the New Year financially stress free.
For more helpful tips on making your money work better for you, Sign up for the It’$ My Money™ Newsletter.
As a person who traveled extensively for my employer and my business you can imagine how it was for me when all of that came to a sudden pause. No travels - none at all, not even locally, due to the pandemic. My last out of state trip was to LA at the beginning of the year. Now the annual event of the year is here. Am I going? Can my husband make it as he is still recovering for being sick? Our original plans were to make it a road trip.
Then when it was clear he was unable to go so I had to make a last minute decision on how I would get there. Go with others, was an option. Grab a flight and ride back with others. Search from a direct flight from JFK or just leave from BDL and take a round trip flight.
The Flight: The best option was the round trip there and back from BDL. Now it is a week before the trip (not ideal for a great flight price) but it is what it is. Then I remembered, I had airline points. I tried to use the points to no avail. I didn’t have enough to cover the round trip then tried to purchase the balance of the points and it would have cost more than to getting the full round ticket through Expedia so I did that. $384.20 round trip from CT to Newport News, VA and back.
Next was booking the hotel. I also had hotel points. This time enough to to cover both nights at the Marriott. $0.00
Now how will I get around while there. A rental car? Uber? I weighed the options, rental car would mean the hustle and bustle of getting it, paying for parking at the hotel, finding parking at each stop, putting gas in it before return or using Uber. Uber would pick me up at the door each time and while I rode I could check out what’s going on my phone. Uber won. Total in Uber for the 3 days - $83.91.
The night before leaving, I had a little anxiety. I tossed and turned all night. Not sure if the anxiety was from an early flight and not wanting to over sleep and miss it or this was the first time I would be going through an airport onto a plane, etc. with Covid still running wild. The alarm went off. It was time. I was Masked and gloves up and off I go.
I packed accordingly so baggage fees - $0.00
Each leg of my flight there I didn’t have anyone sitting next to me. Great for social distancing and for stretch out. In between the two flights I charged up my computer and cleaned out some emails and enjoyed my breakfast. I also caught some of FinConX which is a financial conference and black enterprise entrepreneurship summit. I have to keep my finance game tight, learning from others, so I can be better for my clients and my squad.
Now the food story. Ok, conducting business and dropping knowledge over food always go over well. Also you will see I didn’t really eat day one. I know that was not good but I survived.
I get to my hotel on day one and all I had on my mind was I need to eat and get some rest before the evening event. BUT NO. I had a reaction to something some thinks it was the stress of the night but never-the-less I had a virtual visit with my doctor who gave me a prescription right away. Not sure how much my portion of the visit will be after insurance but the medicine I got from the pharmacy was $12.00.
While I am at the pharmacy, I made good use of the waiting time and had a call with a mentor I was partnered up with from FinConX. I almost basked him if I could reschedule but I am glad I didn’t. Chris Peach gave me some great tips. I also loved his energy. PRICELESS
After getting dressed for the evening I headed to the greatest night of the year. If you know you know. And all I can say is it was all worth it.
The last day, I stopped to grab a Pepsi. Ok, I love Pepsi. There I met another small business owner from the area. We did out elevator pitches and kicked it off. She gave me suggestions on business comments in the area and advice on areas for consideration for my move (a story for a different blog post). I also supported her business right there $14.83.
As I sit here at the airport writing this I am super excited about how the economics of this last minute air travel trip turned out. I had a group finance strategy session, met with the It’$ My Money Sales Manager, Connected with one of my squad members and heard about the journey his achievements. In case you don’t know The Squad is my Facebook community. We share stories, wins, spotlight members and I give tips on how to increase your savings, maintain your budget, increase your credit score and earn money with side hustles. Check us out.
Now about to board my last leg heading home. I just got a cup of Starbucks coffee. $3.19.
Lesson learned, I could have gotten a less expensive flight into Norfolk which was twenty minutes from Newport News. Who knew? This is a direct result for not having enough time to research.
Ok. Now time for the total. This was a 3 day trip from CT to VA and Back, including flight and transportation:
Ok, ready for the best part, it is a business write off.
What do you think of the amount spent? Other than flying into Norfolk, any ideas of how I could have saved on this trip? Grab a free budget sheet
This post may contain affiliate links which may compensate us based on your interaction at no cost you you. Please read the disclosures for more information.
With the holidays around the corner, many households are saving up for gifts, family and friends get togethers and more. This means many people are not saving for the unexpected expenses, which may force them to cut into their gift giving budget in the event of emergencies.
So what happens if the car breaks down? Or if the heater conks out during the winter and needs repairing? Safety-Net Expenses can eliminate the worry of where the money is going to come from to repair that car or HVAC. But what exactly are Safety-Net Expenses?
Instead of the standard three known categories of a budget, I like to think of expenses in four different categories, or buckets, by order of importance:
Non-Negotiable Expenses help to meet our basic human survival needs of shelter, transportation, food, and water. Expenses like mortgage/rent, car payment, electricity, utilities, groceries, and water are primary expenses that must be paid on time to sustain a comfortable lifestyle.
The NBD’s (or Necessities by Default)
NBD Expenses are not as important as the non-negotiable expenses, but these expenses enhance the quality of life. NBD’s include expenses like a cell phone bill, cable bill, primary insurance (health, homeowner, auto), personal loans, student loans and credit cards
Enrichment Expenses are activities and expenses that enrich our mind, body, and soul.
According to ABC News, “40% of Americans could not come up with $400 in the event of a financial emergency.”
Unfortunately, many households forget about or ignore this category. However, these low cost expenses can be the most important to protect our financial stability. Safety-Net Expenses are a set of expenses that don’t cost much upfront, but can save massive amounts of money in the long run.
So which Safety-Net Expenses should we pay attention to protect holiday shopping budget and financial security throughout the year?
Emergency Savings Fund
Set up an automatic direct deposit of a certain amount or percentage of your pay into a savings account. Establish the savings account in a financial institution that is separate from your primary checking account. Having a separate savings account will eliminate the ability to transfer funds from your savings when hit with spending temptation. Having this savings fund will protect your family’s financial stability in the event of an emergency or accident during the holidays. Check out this budget bundle
Vehicle Service Contract
One of the most significant unexpected expenses that is the biggest holiday budget buster is a vehicle breakdown. According to a survey done by Toco Warranty, “Around one-third of Americans own a car that is at least seven years old, which means a breakdown is inevitable.”
Instead of committing to thousands of dollars and years for an extended dealership warranty or dishing out thousands of dollars for unexpected repairs, consider a low-cost, month-to-month vehicle repair coverage contract like Toco Warranty.
What I love about Toco is that it is a pay-as-you-go vehicle service contract that fits within any monthly budget and can be canceled at any time. It can protect your budget from significant car breakdown expenses that happen during the holidays and throughout the year. It can also be cheaper than an extended warranty from the dealership. *For 50% off your first month, use code BOSS
Home Warranty Coverage
Many things that are not covered under a standard homeowner’s policy as a result from neglect or failure to properly maintain the property. Damages from termites and insects, bird or rodent damage, rust, rot, mold, and general wear and tear are typically not covered. Damage to appliances and HVAC (heating, ventilation and air conditioning) breakdown is also not covered. The worst time for the HVAC system to breakdown is in the summer and winter during the holidays. These are the times that repairs cost the most.
Investing in the right home warranty coverage will protect your budget from the excessive expense of appliance or HVAC repairs or replacement during the holidays and throughout the year. These and other safety-net expenses will protect your family’s financial stability with their affordable monthly payments, and can help you budget to spend even more during the holidays. If you find that you need to reduce expenses to fit your monthly, consider reducing usage-based expenses in the other categories, specifically curbing energy use or pulling back on auxiliary expenses, like include eating out, credit cards, or enrichment expenses.
What are some Safety-Net Expenses that protect your budget from excessive unexpected expenses?
Guest blog from Tarra “Madam Money’” Jackson check her out here.
Tarra is an award winning International Speaker, best-selling Author, Spokesperson, Brand Ambassador and Financial Expert Contributor, Tarra Jackson inspires her audience to overcome financial challenges by giving simple strategic steps to help them reach their personal, professional and financial goals. Individuals and corporations have been impacted by her engaging and energetic messages.
What would it mean for readers of this blog if they could retire at age 30? Is that something you think is an unachievable dream or too challenging to execute? Here we explore the story of someone who just did that. She decided when she was 25, that she wanted to retire at 35. She made the required changes to her lifestyle and achieved her dream half the time at 30. Here we explore the story of "A Purple Life" who achieved this feat and will go through her story of how she achieved it
How do you figure out the math to retire at 30?
So, the first question that needs to get answered is, how does the math work out when someone decides to retire at a certain age? For "A Purple Life" when her partner introduced her to the concept of FIRE (Financial Independence Retire Early) definition from Investopedia, she put it on the backburner for a couple of years. When she reached 25, she finally decided to plunge into this and calculate how she could retire early and live a fulfilling life.
At the age of 25, "A Purple Life" was living in Manhattan, making about $65k a year and spending $35k because, as everyone knows, rent in Manhattan is not cheap. Based on her retirement requirement, she calculated she needed to save about 25 times what she was spending at the time, which was approximately $35k. And it was going to take ten years to accumulate that money. Hence, she originally planned to retire at 35. But then she started optimizing her life, which led her partner and her to move from New York City to Seattle. So, they got a better experience and better quality of life for about half the cost. She increased the salary by about $20k just for moving and cut her expenses in half ( as the rent was cheaper in Seattle). After that, she had a couple more job changes, which increased her salary by $20k each. So, the increase in income coming in and keeping her expenses low at $18k helped her cut her time to retirement by five years, and she could retire at 30.
How do you prepare and analyze to achieve your goal?
So when "A Purple Life" and her partner first realized that they wanted to follow the FIRE philosophy, they had to look at all their life choices objectively. They had first to figure out how to move out of the most expensive city in the world. So they made a spreadsheet and listed every major city along with salary probability, cost of living, rent, sound public transit system as they didn't own a car, and the ability to get jobs if they lost a job. After a lot of analysis, they landed in Seattle, where they could get comparable salaries, the cost of living was half, and jobs were plentiful with good public transit. She also looked online at Numbeo www.numbeo.com to see the available prices and the price differences between New York City and Seattle before deciding.
The other thing, "A Purple Life," had always done even before deciding to go down this path was to keep a budget. So, once she moved to Seattle, she tracked her budget closely and saw that she did even better than forecast. She only spent about $18K instead of the $35K she had planned. This change in expenditure was one of the primary reasons she got into retirement at 30 rather than 35.
"A Purple Life" used a tool called YouNeedABudget for budgeting. She has been using the platform for almost six years now, and she relies on it and likes it a lot more than Mint.com, which she was using earlier. Budgeting was critical because if she did not know what she was spending in New York, it would have been difficult to calculate when she could retire. The other things are being consistent with budgeting over multiple years. Knowing and tracking it allows you to see the patterns and the exceptions and create a realistic retirement budget calculation.
One of the reasons she likes YNAB is that it does not criticize you for not sticking to a budget. It is not about like sticking to a number at all. It is about making choices. For example, if she decides to splurge on a friend's birthday that she just got invited, she should be able to do that. Even if she overshoots by 50 bucks her eating out budget for the month, she can compensate for that by buying fewer new clothes for that month. So budgeting is not about restrictions, but it is about making choices. If you like budgeting using one and paper or an editable document you can find a couple versions here: budget sheets.
How did she come up with half a million to retire number?
Once "A Purple Life" was able to see that living in the middle of Seattle downtown, she could spend $18K, living a wonderfully comfortable life. She decided to calculate what would be her total expenditure in retirement. She raised her yearly cost by like 11% based on what she read online and came to the figure of 20K on average, each year. So usual baseline to figure out how to retire over 30 years is to 25 times your annual spending. So that is how "A Purple Life" came up with a figure of half a million dollars needed for retirement.
This number works for "A Purple Life" and her lifestyle, and it will be quite different for someone else reading this blog. The only reason she is comfortable retiring at 30 with half a million dollars is cos her lifestyle is entirely flexible. She does have a partner, but they have separate finances. So, she is only responsible only for herself. They do not have or want children, do not have a house, do not have a car. So literally, she has no fixed expenses month to month. And that allows her to be completely flexible.
Pre COVID, she planned to use her flexibility and travel to Australia, New Zealand, Argentina, and Thailand this fall. That has changed because of the pandemic, but she hopes to use her flexibility and use geo arbitrage the same way she moved from Manhattan to Seattle. If she keeps moving around to different places, she can choose where she is going and can spend a lot less based on the cost of living, say in a place like Thailand.
Maintaining a Nomadic Lifestyle
“A Purple Life” considers her to be a proponent of Nomad Life, which means not having a place of their own and moving from place to place. She has a partner who is not retired yet but has a remote work schedule, which means he can join her on her travels and still work remotely. They have been doing remote jobs for the past few years and are well versed in that lifestyle. They have been living in monthly Airbnb’s for the past two months, but they are still in Seattle. They are in different neighborhoods and are like slowly moving farther and farther from the life and people they know. These moves are like practice runs and getting used to living in an Airbnb in a city that you know and speak the language fluently is much more comforting than just dropping into Bangkok like right now. Next month they will be moving to Georgia and stay and work in a nomadic fashion from there. So, they are only slowly getting farther and farther away, and then post COVID can restart being nomads around the globe.
What were the difficult parts of executing this plan?
Creating the financial model and putting in the numbers was the easy part. The tricky part was taking action to make those numbers real. Once she figured out how much she needed to save how long it would take her, she had a reliable roadmap and added a countdown.
The hardest was moving across the country away from family to a place where her partner had never gone. She did not know how that would go, so it was a leap of faith and challenging to execute. To find a job on the other coast where she and her partner had never lived, where they did not have any connections, was also really challenging. Continuing her daily work life in marketing because it is very demanding and 70-hour weeks are not even blinked at really. So just keeping that up to get the salary that she had projected for the plan to work.
So yeah, it is simple to get the program together. But the steps she took were not always easy to execute.
"A Purple Life" where does that come?
"A Purple Life" is a blog that she started writing six years back and is found at A Purple Life. Purple is her favorite color, and it always has been, and she has been a little obsessed with the color. Since she was about 16, she has been dyeing her hair purple and used to have purple contacts. A lot of her clothing is purple.
She had been writing her blog in private for a year, and one fine day while talking to another blogger, she decided to make her blog public. So, she went home to find a domain name for a blog, and she was looking at herself with the purple hair and decided to name the blog a purple life. But a Purple life to her means like a slightly different life, not worrying about what other people will think basically and just doing what you want to do.
I encourage you to take a listen to my discussion with A purple life, check it out here: Episode 64 or on any other platforms where you listen to audio podcasts.
Get your free budget bundle, which includes 2 budget sheets and a debt tracker.
If you ask some people, they will tell you that the key to success is hard work. Other folks might say it is nothing but luck. Those who truly know will point to one thing and one thing alone. You have to have a firm understanding of money and how it works.
In other words, you need to know how to make money to have a lot of it. Makes sense when you think about it, right?
Unfortunately, many people know absolutely nothing about managing their personal finances let alone how to make even more money beyond just what a paycheck brings in periodically.
In this article, we’re going to explain the seven streams of income, what they are and how they work, as well as draw attention to how you can take advantage of these avenues for making money to help yourself lead a richer, more financially secure life.
Earned income is the money you make from a job, typically in the form of a paycheck. Your paycheck can be based upon an hourly rate, commission, or some combination of those two or even a salary. This is the form of income that most everyone out there is familiar with and that most of us utilize.
In fact, it is the primary source of income for the vast majority of people out there. Earned income can also relate to self-employment though, typically, it is more often associated with drawing a paycheck. At its most basic level, earned income means the money you make from performing a job at a certain rate or wage based upon either a contractual, perpetual, or one-time agreement.
Profit (from a Self-Owned Business)
If you own a small business any profit that you make from that is an income stream. This business could be something simple like running a blog and collecting ad revenue or something more complex like consulting services. Heck, it could even be money that you make with an eBay store.
Whatever your business type, the profit drawn from that comes to the owner in a form of income that is not contingent upon an employment agreement of any type. The best way to distinguish this type of income from “earned” income is that profits from a small business typically empower people to be their own “boss.” In other words, you sign your own paycheck when you take profits from a business you own.
Interest-bearing accounts like savings accounts and certificates of deposit are both a form of income as well as a type of passive income. Passive income designates the way in which it is earned. When it comes to money, passive means that the person receiving the money in the form of dividends and interest payments did nothing other than allow another person or institution to hold that money.
This applies to savings accounts and other bank instruments as well as securities like stocks. Investors who move enough money into “passive” income vehicles can often find themselves making more passive income than active income - an ideal situation to say the least.
These are similar to interest-bearing accounts in that they are a form of passive investment, but the major difference here is the level of risk involved. In essence, both the principal amount put forward to purchase stock can go up and down as well as any dividend it might pay. While the amount of interest paid on a savings account can fluctuate, most governments around the world provide a kind of insurance to depositors in case the bank goes out of business. This means that most people retain the full amount of money that they put into the bank.
The stock market never operates like this. In fact, the amount of money put forward by an investor can go to zero in a heartbeat. Yet there is an upside. As the old saying goes, there is a definite floor at a $0 valuation, but the sky is the limit for the upper number. In other words, stocks can theoretically go up in value forever as long as demand keeps increasing. This is how small investments can become huge fortunes - and all without any active involvement on the part of the investor.
Owning rental properties cannot be classified as passive income though some people often make that mistake. The reason for this is that they often become a job in and of themselves to manage - whether by yourself or with a team of people. Related to the profit income stream discussed above, rental properties are not hard to understand from a money-making standpoint. You purchase properties and rent them out to tenants.
The money you take in from tenants less any loan expenses, maintenance expenses, insurance, taxes, and other associated costs is your rental income. A simple concept in theory, rental properties can often become one of the more complex ways to make your money work for you. But, for those people who enjoy being their own boss, rental properties are an ideal way to meet a market need and create a stable income stream.
Often associated with stocks and investments, capital gains refers only to the process of selling an item for more than you paid for it - or even less, which is called a loss. At its heart, capital gains is the essence of trading. When a trader purchases a certain item from one seller at a certain price, then sells that same item to a buyer at a higher price, the difference between the price the second seller paid and the price the buyer pays to that same seller are known as the capital gains.
The process of making money from this difference is known as arbitrage. Sometimes the amount of money made selling an item - stock, widget, house, car, or whatever - is very small but, if done in vast quantities, adds up to huge amounts of cash. This is why some brokerages will buy up shares of stock only to sell them later for a few more cents per share.
Capital gains take many forms but the basic thing to remember is that it is the process of selling an item for more than you paid for it with the difference between the purchase price and the selling price is the gains on your capital.
Royalties are paid to you for work that you completed in the past. This could include a book, song, play, or other types of media that requires a license to use. For example, if you are a skilled photographer, you could put your images up on stock photo websites for licensing to other users. The fees paid to the agency will be shared with you in the form of royalties. This is a passive income vehicle because you are getting paid for work you have already done, sometimes even years before.
Hopefully you have a better understanding of the seven streams of income. Some of them are easier to make than the others, but if you have a plan, you may be able to attain all of them.
How many streams of income do you have?
This is a guest post from Jason Butler. To read all the stories which Jason posts head over to his website, My Money Chronicles. He can also be found on Facebook at My Money Chronicles and Twitter at Money_Chronicles, and he also runs his own FB Group of My Money Chronicles - The Inner Circle.
Here are other blogs on starting a small business and side hustles
In today's world, there are many ways you can give back
to your community or those in need. A small encouragement or support from your end may make a lasting impression on someone else's life. Also, as the saying goes, if others' generosity has blessed you in your past, you are obliged to pay it forwardto keep the good karma going. There is nothing more fulfilling in life than helping someone else without expecting anything in return.
I was recently a part of many of Experian’s #CreditChat panels and shared my views on paying it forward and giving back.
As a Personal Finance Expert, International Speaker, Host of the podcast The Money Exchange and an Award-Winning Author of the financial journal book series, It'$ My Money™. I have been asked several times by Experian to share my views and this one is near and dear to my heart.
For me, the primary benefit of giving back and paying it forward is just the joy that comes with the act of helping someone else succeed. The fulfillment which comes with that act far exceeds any tangible benefits. The causes which I support are the ones that align closely with my own beliefs. Some include United Way, YWCA, and my church.
The act of giving back doesn't necessarily have to be monetary. Even some simple acts of kindness and thoughtful gestures can make a significant impact. The action can be as small as asking someone how they are doing at the start of the day. Sending a kind note to your colleagues, friends, or family and just inquiring about their well being or just reminding them that you are thinking of them. I find that I give back in time and labor more important than anything monetary. Sometimes all that someone needs is for someone to listen to them and that's enough to brighten their day.
You can give back directly for charitable causes without breaking the bank. If you would like to be generous, there are multiple ways you can do it, even if you are on a tight budget. You can create or build something which you can then give out to the needy. An example during the COVID-19 time would be creating masks and donating them to the organizations where you can make a maximum impact. Another way would be to feed the homeless in your neighborhood, which again provides a significant effect on a homeless person without having to spend a lot. These are charitable activities that can be done on a low budget and without a lot of pre-planning.
I have spent a significant portion of time raising awareness in shaping the spending and saving behaviors of my clients to guide them toward financial independence. I believe whatever the cause is, the best way to raise awareness is by using social media platforms, especially video-based platforms like YouTube. That is where the audience who will be supportive of your cause is hanging out, and you reach them where they spend most of their time. COVID-19 has also put most of the conventional ways of supporting and helping your community on pause or moved to unconventional ways. This doesn’t mean it is not possible, you just have to be safe and social distance and wear masks.
Many people are out of jobs, and many small local business owners are trying to save their business. You can help them stay open by buying local and support the jobless in finding new jobs, hire them or contribute to train them.
As with anything positive within human endeavors, we also have negative aspects like fraudulent charities and organizations that pop up. The best way to determine if a charity is legit, is to search their track record by researching on Google or the Better Business Bureau website to see their business rating. You can also check who the team members are running the charity and read their financial statements to understand what percentage of your charity goes to the cause and what percentage goes to administrative expenses.
Sometimes acts of kindness are a complete surprise and come out of the blue without any warning. The most memorable act of kindness was when my husband and I went out for dinner for our anniversary. We had a beautiful evening and thoroughly enjoyed our delicious four- course meal. When we completed our dinner and asked the waiter for the bill, we were pleasantly surprised. The waiter told us the gentleman seated at the table next to u had paid the entire bill and taken care of the tip as well. It was such an unexpected but beautiful gesture, especially coming on the day of our anniversary. The gentleman that paid asked the waiter not to tell us and he was gone when we found out.
One of the areas I focus on is finding ways in which to inspire kids to be generous. I spend a lot of time working with kids on educating them in developing better financial prudence for their future. On my website, there is a free It'$ My Money™ and Sammy Rabbit Coloring Book, which is perfect for kids to have fun while learning that saving is a great habit. In my experience working with kids, I believe that the best way to teach them about giving back is to show them acts of kindness instead of telling them to be kind.
The best way to give back and pay it forward is always to be kind, spread love and joy, tip the essential and demonstrate these actions in front of kids regularly.
On The Money Exchange Podcast and in the It's My Money Journal
we have explored many stories about individuals getting out of
debt, but hearing about someone doing that at Roy's age, is rare.
Here we explore the story of Roy Patterson, a 31-year-old who paid
off his student loan debt of more than 55K in four years. You will
hear about his journey, how he accomplished his goal, how his parents
and siblings joined him on this journey, his story highlighted by
CNBC's Millennial Money, how he it was also essential in dating and his tips for anyone with this type of debt to accomplish the same.
Roy comes from a Jamaican immigrant family, and his parents have been in the states for well over 30 years. Attending college was always a dream, but at that point, he didn't understand how much it costs to go to a 4-year college in America. Roy took out student loans co-signed by his parents and started his journey into debt. At the end of four years, he was about to graduate from college, and he started getting emails from all the loan companies about loan repayment and interests. Initially, he decided to ignore them as he was scared about paying these loans and not having a full-time job. Until the loan companies started calling him and that is when it hit him that he needed to figure out a way to pay off his student loans.
Starting the debt-free journey
About six months later, Roy got a full-time offer at a large insurance company through their Technology
Early Career Development Program, where he was able to bring home a pretty good salary. This stable job gave him the confidence to tackle his loans. One of the first things that he ended up doing was understanding his relationship with money, understanding what a budget is, his student loans, what's different between subsidized and unsubsidized, and how much interest he is paying a
During the same time, Roy was intrigued by the Suze Orman show, uniquely her segment titled
"Can I Afford It." Watching the show, he realized many folks were in a worse position than he
was. Suze Orman was starting to resonate with him because she talked to people who were in
bad financial situations than he was and was able to provide them with an outlet. So he thought
to himself if those people can do it, why can't he do it, and then that's when he decided to get
serious about the debt.
He brought in his mom, started watching it together, took notes, and made a pact to stay the
course. He convinced his mon that they were going to follow the plans, learning together and
settling all of their debts.
Roy's story is not a straight shot to debt-free living, and there were many twists and turns along
the way. Roy started his full-time job in January of 2013. He worked on achieving a debt-free
life from 2014 to 2018 which is when he officially finished paying his loans. He paid back the entire $55k.
In between, Roy did get sidetracked and discarded his frugal ways in the hopes of living life more.
But he soon realized that lifestyle didn't make him happy; what made him happy was to achieve
his goal of being debt-free by 30. So he refocussed on his efforts on hunkering down with his
plans on reducing the debt he had, that's when it happened and was able to attain the happiness
he was searching for by reducing his debt.
The debt co-signed by Parents
Roy took a look at all his debt: his credit card debt, student loan debt, car debt, and had to identify the biggest thing that was holding him down and how to prioritize the repayment. Student debt came into perspective for two reasons. One is that student debt is not dischargeable in bankruptcy, so it doesn't matter what he does, that student loan debt will never go away besides like some catastrophic issue happening with him.
The second and more important reason was that his parents co-signed student debt. So if he didn't pay off those loans, they would be saddled with these debts. Roy also has a younger brother and sister who also went to college, and his parents co-signed on their loans as well. Roy was mortified that if he didn't pay his student loan debt, this would be bad for his parents especially coming into their retirement years. Overall, this was one of the primary reasons for sticking to his plan as he didn't want his parents to pay for or be in trouble over loans he used to get a good education and get a career.
Methods to pay back loans
So, when Roy decided to pay off loans, the one thing he read was first to pay off your higher- interest loans. Although it was sound financial advice, Roy felt he had to attack his credits based on his psychology. Roy didn't follow that method, but he pursued another methodology called the snowball method. The usage of this method was predicated on understanding the psychology of the mind and what makes you happy. The snowball method makes you start with your lowest balance; it doesn't matter what the interest rate is. You pay that off, and then you work on the second lowest balance, and you go that way until you're able to pay off all your loan. Getting the satisfaction of completing one loan payment boosted his confidence and allowed Roy to continue living his
debt-free process. Roy can implement his plan, which is to necessarily forgo any social ideas or anything like that and focus on paying off this debt.
But in his journey towards a debt-free life, he changed methods and moved from the snowball to the avalanche method. Roy ended up switching it up because his interest rates for my private loans were far higher than his interest rate for his federal loan. So his federal loans at the time were about 6.5% a year while his private loans were close to 14%. As the private loans were variable, the interest rate was changing every three months and was moving 14 to 14.5% to 15%. Roy had to kind of switch his methods as he could not continue to do this snowball because he is going to be spending a lot more money trying to pay off the interest on these private loans. In the avalanche model, Roy started with a high-interest loan paid those off and then began to work on the next loan with the lower interest.
CNBC Millennial Money Program
Roy had watched CNBC for eight years since he graduated from college. Within CNBC in their "Make It" section, which is their college or the young millennial version of CNBC, they have a program and a column called Millennial Money. Millennial Money is a program with an interview series profiling millennials in different cities and at different income levels about how they make, spend, and save their money. Roy watched it over a year and reading through the blogs and getting a lot of insights. He has always believed, and told his family and friends, that he would be a good fit for the program due to his unique story. After getting a little bit of encouragement, he went on the CNBC Millennial Money website and sent them an email about his story. Surprisingly about a month later, they got back to Roy, stating they were interested in featuring him on their program as well.
The CNBC team decided they wanted to come to Philly and film a segment on Roy. From initial contact, in November of 2019 to about February 2020 when formalities were completed to March 2020 when the shoot finally happened. The CNBC team started shooting and putting Roy's story together. One of the things Roy was afraid of is that once he signs the waiver, he would lose all creative control, and he wasn't sure how his story would come out. But to Roy's surprise, when he saw the final video when it came out the video, and the article conveyed everything that he wanted to say. The CNBC team stayed true to their initial discussion and covered the story in a way that highlighted the areas of hard work and perseverance which Roy wanted to project. The reaction to the Millenial Money program featuring Roy's story has been phenomenal. Many people came back to Roy, thanking him for telling his story. Many people have come to him and shared their similar experiences, and it inspires them to do it as well and become debt-free. He got umpteen messages to thank him for doing the program and putting the story forward of someone that looks like Roy and sounds like Roy and comes from his background. It is more relatable to many people and lets everyone know that is possible. He has inspired many to start their debt-free journeys and inspiring people to lead and stay the course on their journey.
One of the things that Roy loves to do is helping other people. Roy spends a lot of his time working with people who don't have that support system like he had and helping them accomplish their dreams and goals. So sitting with them, consulting with them, and trying to understand the relationship with money and what they can use to put a little bit of rigor and a little bit compassion into what they do. Roy also runs a financial literacy program at work, where he, with a partner, created a curriculum for new hires, so they understand what taxes are and how to budget, and then how to make prudent financial decisions. Along with that, Roy also works with students middle school, high school, college students about student loan debt, credit cards, and things like that to give them an idea of what you know what's coming. Roy tries his best to give back to the community to provide support when people don't have that because, again, he was very fortunate, and he knows that. Roy is lucky to have a two-parent household, which gave him all the support and guidance that was needed. Roy's goal is to
provide that and be the sunlight for someone who may not have that same support that he had.
A quote, Roy believes in wholeheartedly, is that "Money doesn't make who you are. It only brings out the good or bad quality that's already in you". And what Roy means by that is that money is excellent and allows you to do things you want to do. Still, it also will bring out the positive quality you feel like, such as perseverance. But, it can also bring out the negative side in you, like jealousy and things like that, so Roy always wants to let people know that money is great, but don't let it ruin your life. Don't let it be the end all be all as money only allows you to do the things that you do want to do.
That's what Roy wants to let people know is now that he paid off his loan, but he is still the same person that he was, you know, ten years ago, 15 years ago. The second piece of advice for people is to stay focused, stay the course, and see that you're going to have missteps, Roy had failures along the way nothing was easy, he believes he took two steps forward and then took ten steps backward, but he never gave up. Don't give up, keep on going, keep grinding, talk to people, and get there.
Roy Patterson dropped some knowledge for all of us. To hear the full interview, listen to the podcast. Roy is also a Financial Facilitator on the It'$ My Money™ team. Feel free to comment here if you are interested in engaging to discuss financial literacy, paying off student loans and debt-free living. Need a debt tracker and budget sheet, check out our freebie page. Interested in financial coaching reach out to our team CONTACT
Homeownership is something many dream of and many are about to start the process of making it a reality. For most it is a 15 or 30 year commitment so ensure you have as much information as possible before signing on the dotted line. Over the last several weeks se covered several terms to know when purchasing a home in the It’$ My Money Squad. This gives you a sneak peek into terms we covered when preparing to buy a house. I also hope you love the graphic as much as I do as it consists of the terms in the shape of a house.
Choosing a Real Estate Agent:
A good real estate agent is a critical in the home buying process.
Real estate agents can provide:
If an agent consistently shows you hours outside of your budget be concerned. That said, an agent may show you ONE house outside of your budget by way of comparison or to do a reality check but that is it.
Searching for a home:
When searching for a home create a list for must haves or show stoppers. Also, include "would like to haves" and a space for comments. Ensure you share the list with your real estate agent AND bring a copy of the list with you each to each home visit. Literally check the items on your list while you are there. When you try to do it afterwards, you forget and it is hard or compare.
Pre-qualified vs pre-approved:
A couple others steps in the home buying process is pre-qualified and pre-approved. These terms are often used interchangeably but are different.
Here is a quick definition for each.
Be sure YOU can afford the house and the other things you enjoy doing regardless of the amount shown on either.
The asking price is the amount the seller is “asking” for the property you are interested in buying. Often times buyers want to know “should we offer the asking price” or “will they accept a lower price”. Well the depends.
How long the house as been on the market? What price have other houses recently sold for in the area?
Your real estate agent can help with that appropriate asking price.
First time buyer grants available (links shared me for informational purposes):
Philadelphia, PA giving away $10,000
Baltimore, MD giving away $5,000
New Haven, CT giving away $10,000
Fairfield, CT giving away $30,000
Hamden, CT giving away $5,000
Hartford, CT gives away $40,000
Carbondale, Illinois gives away $3,000
Washington, DC gives away $4,000 or Maximum gap financing of $80,000
Washington, DC teacher next door $4,170
New Jersey gives away $10,000
North Carolina gives away 3% - 5% down payment assistance
This gives a sense of how we are educating in the It'$ My Money Squad. We also have Squad members that facilitated free helpful sessions sharing their expertise such as home owners insurance and staying out of foreclosure.
The world has changed a lot within the past three months, first with COVID-19 and then the nationwide protests against police brutality in the last couple of weeks. During these uncertain times, there are many ways you can support black-owned businesses, primarily spending your dollars there. To help in that endeavor, we at It'$ My Money ™ have created a directory of 142 black-owned businesses. These businesses range from categories like Apparel, Beauty, Travel, Health & Wellness, Food, Finance, Consulting, Cleaning Services, and other Business Services. The intent is if you are going to spend any dollars in the coming days or months on any of these categories, then use this directory to find Black-Owned businesses.
We only complied the list of those who sent their information, this is not an endorsement
We understand that this is not a comprehensive listing of all black-owned businesses, but our attempt to help you in spending your dollars appropriately. We are open to receiving more submission to add to the listing, as this is just a start SUBMIT A BUSINESS.
We at Its My Money™ enthusiastically help individuals create and maintain a budget, increase savings, earn an additional stream of income, and use credit responsibly. We do this through engaging workshops and empowering one on one settings. Click here for help to get your money in order.
This small business is getting popular day by day as it needs minimum investment and you may earn extra money easily.
The biggest benefit of this business is that you can work from your home, which gives you a lot more freedom. If you want to find potential clients, use websites like Upwork.com and you may choose suitable clients, preferable work hours, and your hourly, daily, or monthly pay rate.
3. Web developing
There are nearly 4 billion people who use the internet in the world. So you can redirect a great percentage of this massive online population into your existing small business if you have a website. Approximately 6 out of 10 small businesses maintain a website. So, if you do not have an existing small business, it is still very important to learn web development skills to meet the huge demand for building and upgrading business websites.
You may start your business by creating and developing websites for your family and friends and brush up your skills. New business owners always search for great coders to make their websites cool and trendy. They also want their website should load easily and fast to increase the user experience.
You may start your career by offering competitive prices for your services. Once you get some popularity as a good coder, you may increase your prices. Don’t forget to create a website for yourself and showcase your work over there, it will help you to build a strong profile as a coder.
Improving business will be easier if you also improve your skills. So, you also need to update yourself with different, new techniques of web development and improve yourself.
4. Bookkeeping services
Do you have good knowledge about maths and accounting, and also want to work from home? If yes, you may start providing remote bookkeeping services. As a freelance bookkeeper, you don’t require to be a Certified Public Accountant. But, your skills should be up to the mark to support your customers. You should know about modern accountancy, tax laws, company laws, and other required subjects. Some services you may offer include:
5. Freelance secretarial services
This is somehow a similar concept to virtual assisting. You may provide secretarial services remotely to business executives or companies. You might require some special skills to get the job. Those skills may include:
6. Travel consultancy services
If you are passionate about traveling and you are always updating yourself with the information about best locations, best hotels, cheap airline tickets, best deals on tours, then you have a great potential to become a travel consultant.
This business is all about making good connections and gathering info regarding best deals on the best services. So, you have to use the internet, search hotels, call them, and make contacts. You not only have to negotiate with people interested in travel, but also with the hotel owners, cab owners, and lots of other people who will provide the best services to your travelers.
Once you are set with the contacts, make sure you start by helping your family and friends to get the best travel deals. This way you can check all the services and get the most genuine feedback from your relatives and friends. If the arrangement proves good, you will also get popularity without spending a dollar on promotions. In most cases, people who save money for holidays and vacations, trust such service providers through the word from their close ones.
You may opt for certification in travel consulting if you take this business seriously. You may also need to create social profiles for your travel consultancy business on platforms such as Facebook, Twitter, Instagram, LinkedIn, and share information via your website, or forward great deals on WhatsApp. Once you become a popular name in this business, negotiate with service providers to offer exclusive deals for your customers.
Guest Author Bio: Patricia Sanders is a professional content developer and a regular contributor to debtconsolidationcare. She specializes in the financial niche and is well known for her unique financial tips that can be very effective. She always tries to help people, suffering from financial hardships, through her writing. Her continuous effort has earned her recognition and honor in the financial blogging industry. Besides writing, she loves to travel and gather information on various financial topics. To get in touch with her (or if you have any questions regarding this article) email at firstname.lastname@example.org. Need a personal finance coach? Try It'$ My Money
Write something about yourself. No need to be fancy, just an overview.