Managing Finances When Money is Tight

The way a person manages their household finances can have a deep impact on their life. Unfortunately, money managing skills are not something that most people are taught as they grow up. Managing money is less a matter of mastering paperwork and numbers and more about psychology. It has to do with the mindset a person has toward money. This mindset is what allows a person to successfully manage their household finances, even when money is tight. The following are a few tips that could make managing a tight budget easier. 

Take Advantage of Available Resources 

Going into debt temporarily may be less expensive in the long run than giving up equity. This means that managing household finances could involve temporarily borrowing money to be able to keep up with car payments, mortgage payments, or cover small business expenses. 

Managing money

Short-term quick personal loans are a useful resource that allows borrowers to cover immediate household expenses and allow some breathing room to make better long-term decisions. In many cases, these loans are preferable to racking up credit card debt.

Other available resources could include friends and family members who are able to provide temporary financial assistance. Another option is looking at programs offered by governmental agencies to provide temporary financial assistance to help cover living expenses. 

The Importance of Setting Goals 

When finances are tight, thinking about setting financial goals may be the farthest thing from your mind. However, if you do not have goals, you will never go anywhere. When going through financial difficulties, it is especially important to set short-term goals as well as long-term goals. Short-term goals may mean determining which items are considered necessities and which ones are luxuries. You can then prioritize your financial decisions based on this. 

Likely, your most pressing financial goal is to cover your current expenses. This would include things like your mortgage or rent, your car payment, your food, your cell phone, and household supplies. Long-range goals would include things like paying off debt, retirement savings, investments, and charitable donations. 

Make Small Cuts Across the Board for a Large Impact 

You know you need to cut expenses from your budget if you’re going to be able to stay afloat. During a financial crisis, you've likely gotten rid of your cable television, your gym membership, and extra entertainment. But there’s still more that you can do. 

Look at the items that you have budgeted as essential, such as food, gasoline, and utilities. It is likely that you can shave off between $5 and $10 off of each category per month. At the grocery store, it can be something as simple as taking one item out of your cart. With your car, it may mean conserving fuel and driving one or two fewer places. With your utilities, it could be something as simple as slightly lowering the temperature on the thermostat. Doing this could mean saving between $15 and $30 a month. Put this money into your savings or invest it. You will be surprised at how big of an impact the small cuts will have over a longer period of time. 

Get a Side Hustle 

Maybe you have cut every which way you can and just can’t cut out anymore. Still, it seems like you can’t make ends meet. Now might be the time for you to join the gig economy. Start a side hustle for a source of income outside of your primary job. 

A lot of side gigs can be performed at home in your spare time. Think about the type of employment you’re already doing. Think about your hobbies and the things that you enjoy doing. Now ask yourself, how can I monetize these? Some popular forms of gig employment include data entry, graphic design, and freelance writing. 

Managing your household finances, especially when money is tight, is a challenge, but it can be done. It is imperative that you identify your priorities and then use those priorities to create a value-based spending plan and a value-based savings plan. This will make you savvier with how you spend your money and will allow you to save more.

How Can You Obtain a Low Down Payment Home Loan?

Purchasing a home is one of the biggest milestones in your life. Unfortunately, it can take years to save up for the required down payment – experts suggest that you have at least 20% of your home’s purchase price prior to beginning your house search. This number is inaccessible to many people, especially a first-time home buyer or return buyers still paying off the mortgage on their current home. Soaring home prices across the country also make it difficult for prospective homeowners to meet the 20% mark.

Home Loan

Despite these conditions, there is hope for prospective homeowners throughout Washington. Many mortgage providers offer options with low down payments for first-time and return buyers. Mortgages with low down payments can give home buyers a bit of wiggle room when they are saving up for their first or second home mortgage.

What Is a Down Payment?

If you are a first-time home buyer, you may not be familiar with how down payments work in the housing market. Simply put, a down payment is the cash money you will need to pay to the home seller to secure your purchase. Mortgage loans will pay for the remaining cash needed to cover the entire purchase price.

Mortgage lenders calculate down payments as a percentage of the entire house price. Generally, the higher the down payment you make, the lower your monthly mortgage payments will be. However, the standard 20% down payment that many housing experts recommend is not attainable for many homeowners.

For a $900,000 home, which is the average home price in Bellevue, Washington, that means you will need to save $180,000 before beginning the house search. This amount can take years to save and is not as accessible as a 5% or even 10% down payment. In contrast, you will only have to save $90,000 for a 10% down payment and $45,000 for a 5% down payment.

Down payments are important. They show the seller that you have the funds to purchase a home and show the mortgage lender that you have a significant investment in the property. In addition, the down payment also determines the “loan-to-value” ratio of your home. This ratio impacts the mortgage lender’s decision to give you a loan. Lenders calculate this ratio by dividing the mortgage loan amount by the value of the home.

For example, if you make an $80,000 down payment on an $800,000 home, the amount you will borrow will be $720,000. Your loan-to-value ratio will be 90%.

Understanding Mortgage Basics

Before we discuss the low down payment options for home buyers, we first need to understand the basics of choosing a mortgage. Selecting a mortgage that works best for you, your family, and your wallet is key to securing a low down payment.

The first decision you will have to make in choosing a mortgage is the decision between a fixed-rate loan and an adjustable-rate loan. These terms refer to the interest rate you will pay on your mortgage over time.
  • Fixed-rate mortgages have the same interest rate for the entire repayment period. Each month, your mortgage payment will remain the same. If you are secure with your payment amounts and do not anticipate any drastic changes in income, a fixed-rate mortgage would work best for you.
  • Adjustable-rate mortgages have interest rates that adjust after a certain period of time. Usually, you will retain a fixed interest rate for a short period of time. Often, the fixed period lasts a few years. After this period is over, the mortgage provider will usually adjust the interest rate annually. If you cannot afford the fixed-rate payment now but could in the future, an adjustable-rate mortgage would work best for you.
Next, you will have to choose between a conventional and government-insured loan. Conventional loans are not insured or guaranteed by the government; instead, private entities control these loans. Government-insured loans receive funding from various government agencies, including the Federal Housing Authority and the Department of Veterans’ Affairs.

Finally, you will have to choose between a jumbo loan or a conforming loan. Government-controlled corporations called Fannie Mae and Freddie Mac determine the size guidelines for your mortgage. Jumbo loans exceed the limits established by these agencies, while conforming loans fall within their requirements. Jumbo loans typically have higher interest rates than conforming loans due to their size.

Mortgage Options with Low Down Payments

Many conventional and government-controlled loans have options for low down payments. Government-controlled loans can have down payments as low as 3.5%. Conventional bank loans can provide down payments as low as 5%. Additional programs from Freddie Mac and Fannie Mae may also offer low down payment mortgage options. Sammamish Mortgage can pair you with a mortgage option that works best for you.
  • The Piggy-Back Mortgage allows you to combine two mortgages to borrow up to 90% of a home’s purchase price. You provide a 10% down payment and receive two mortgages to avoid mortgage insurance costs. You receive one conventional loan and a home equity line of credit.
  • Fannie Mae offers the HomeReady Mortgage, which allows for a 3% down payment. However, you must own a home in one of the approved areas, which are usually low-income, have a high minority population, or are affected by natural disasters.
  • Freddie Mac offers the Home Possible mortgage, offering a 3% down payment option for those in certain areas similar to the HomeReady mortgage. 
  • Conventional 97 loans offer a 3% down payment under the Federal Housing Finance Agency. This mortgage amount can only be as high as $484,350.
  • Federal Housing Authority (FHA) loans provide 3.5% down payments for prospective home buyers with lower credit scores. An FHA loan is government-controlled. You will have to pay additional insurance premiums if you opt for this mortgage option.
  • The Department of Veterans’ Affairs also offers loan options. You must meet eligibility criteria to receive a VA loan.
Risks of Government-Controlled Loans

Some of the lowest down payments in the mortgage market are available through government-controlled loans. These low down payments can easily sway prospective homeowners. As a result, these buyers do not critically examine the drawbacks of government-controlled mortgage options.

FHA loans offer down payments as little as 3.5%. In addition, borrowers with a poor credit history can receive loans with FHA support. However, the low down payment can lead you to make a poor purchasing decision – while achieving a low down payment is ideal, you should not put a payment down on a home you cannot afford in the long run. Down payment rates that are too low can make your repayment plan longer and increase the amount of interest you pay over time.

The FHA’s low down payment will require you to pay upfront insurance each month. You may not have this amount in your budget and may be surprised with a higher upfront cost than you could receive with a conventional loan. FHA loans also come with certain regulations regarding the quality of your home – if the home is in poor condition, the FHA may not approve your mortgage application.

Many sellers hesitate when selling a home to potential buyers who have an FHA loan. These loans do not signal a strong credit history, and FHA loans often require sellers to meet very strict requirements. It may be a better decision to focus on building your credit history to qualify for a conventional loan with a low down payment than to rush into an FHA loan with higher payments and lower selling rates.

Tips for Obtaining a Low Down Payment

Obtaining a low down payment requires a good deal of outside research, a solid credit history, and an understanding of your financial limits. There are a few solid tips you can follow to increase your chance for mortgage approval and secure a lower down payment.
  • Build your credit history. If you do not have good credit, you will not receive a mortgage from a majority of lenders. Many private entities require a minimum credit score of 680. If you have a lower score, focus on building and strengthening your credit before you apply for a mortgage.
         Making on-time payments, lowering existing debt, and regularly checking your credit report to improve your credit score will increase the likelihood of you getting the loan you want.
  • Save as much cash as you can. While a 20% down payment is quite high, you should aim to save at least 8% of your potential home purchase price. You will also need to save additional cash for closing costs, inspections, application fees, and other unexpected expenses. For a $900,000 property, you should aim to save $72,000 or more prior to your house hunt.
  • Understand your budget. Evaluating your monthly expenses can help you come up with a down payment savings plan. In addition, you can assess how much you could comfortably afford for your monthly mortgage payment.
You will also need to factor in additional costs to your monthly budget if you are a first-time home buyer, such as insurance premiums and property taxes. This exercise will also keep you from a too-low down payment swaying you into purchasing a home you cannot afford.

Are you in the market for a second home mortgage? There are additional factors you may have to consider before applying for another loan. While you could obtain another low down payment, you will have to prepare for higher interest rates overall. You will need to focus on improving your credit history and prove to the banks that you can comfortably afford both of your mortgage payments each month.

Benefits of Paying a Higher Down Payment

While you may want to strive for a lower down payment, you should still attempt to save as much cash as you can. Paying a higher down payment upfront can help reduce your costs in the long run. While the 20% figure may not be possible for your budget, a 10% or 15% down payment can provide more benefits than a 3% or 5% payment could.
  • You will pay less for your home in the long run. A higher down payment upfront will reduce the amount you have to pay on your mortgage loan, along with your overall interest costs.
  • You may receive a lower interest rate with a higher down payment. Since a larger payment signals financial strength, banks are more willing to offer a lower interest option to you.
  • You will beat out other prospective buyers for your dream home. Home sellers prefer buyers who can make higher down payments because they signal financial strength and a high chance of mortgage approval. If you’re up against another buyer making a 5% down payment, a 10% down payment can give you an edge in negotiations.
Obtain the Services of a Mortgage Provider

To find the best mortgage rates and down payment options for your house search, obtain the services of a trusted mortgage lender. These services allow you to learn about different mortgage rates in your area, find a loan program that works best for your financial needs, and assess your financial situation to find the best mortgage for your budget. Mortgage lenders can guide you through the confusing loan process and help you make smart, measured decisions for your financial future.

Sammamish Mortgage is a family-owned and operated mortgage lender assisting Kirkland, Seattle, and Bellevue residents with the mortgage process since 1992. We strive to maintain transparency and ease of access to assist our clients with all their mortgage needs.

With Sammamish Mortgage service, you receive:
  • Free pre-approvals without any application fees
  • Custom, accurate, and timely mortgage quotes
  • Technology to help you price your own loan
  • The ability to track and compare mortgage rates
  • An online digital mortgage process for ultimate accessibility
  • A free home valuation report
  • The ability to refinance or purchase your dream home
Sammamish Mortgage is proud to provide mortgages for properties throughout Washington state. We also provide mortgage services in all of Oregon, Idaho, and Colorado. Our award-winning professionals are ready to help you obtain the best mortgage for your financial situation.

Contact Sammamish Mortgage today to learn more about Sammamish Mortgage’s services and to receive your free mortgage quote.

What Lessons Should We Learn from the "No-Gifts" Royal Party?

Over the centuries, there are lots of proper “do’s” and “don’ts” that can be learned from the royal family. Whether you love the English throne and all of the rules and regulations that come with it, or you relish in watching the old traditions morph into newer, more with the times rules, then the “no-gifts” royal wedding can teach us a thing or two about change!

"No-Gifts" Royal Party

When Prince Harry and Meghan Markle tied the knot, it was not only an historical moment, but it was also gateway to change! Here are just a few things that we can take away from the royal wedding’s “no-gifts” policy and how we can implement change in our own lives! 

All the Parties

When you, or your friends, become parents, your child (and you, of course) are going to be invited to a LOT of children’s parties. Your group of friends is all having kids, and that means several kid’s presents every year. From your wallet, to your friends’ kids. 

If you’re a first time budgeter, you can start to budget all of those presents into your monthly budget. OR, you can set an example with your child and your family. When it comes time for your child’s birthday, you can advertise “no gifts please” on each and every invitation. 

By not having gifts to distract all the children, your child won’t end up with a room filled with things, but instead, can focus on something new. Their guests. The party. And even setting goals! This also breaks up the cycle of you buying gift after gift, year after year! 

Goal Setting

Something else we can learn from the royal party is that we can do something else with our important gatherings other than get presents. We can set goals, we can accomplish them with the help of our friends and family, and we can change the way we operate simply by saying “no gifts please”!

Here are a few things you can accomplish beyond receiving gifts at your next big gathering:
  • Donate. Instead of receiving presents for yourself, your child, or your new spouse, you can collect donations to the charity of your choice. Set a fund raising goal, then instead of gifts, you can ask your guests to donate to a good cause. 
  • Reduce Waste. More and more, individuals are trying to cut down on their wastefulness. Presents, plastic gifts, and wrapping paper can all add up to a lot of useless waste. Not opting for gifts can help you achieve your goal of trying to add less trash to our planet!
  • Focus. Receiving and giving gifts is a time honored way to show someone else that you care about them. This year, however, you can show you care by giving something more valuable. Your time. Your focus. Your love. Using action as a way to spread joy!
By separating yourself from the idea that parties, gatherings, and big events SHOULD include gift giving, then you can clearly start to make a difference. Whether you’re making a difference for yourself, your family, or a close friend, you can start to change expectations surrounding parties. 

Lessons

If you want to achieve financial freedom, you have to learn where you can cut costs, where you can save more, and you will learn some harsh lessons along the way. Removing the expectations of gifts can teach us the real reason why we have asked all of our closest friends and family to be with us!

If you have children, then this may be an extremely important life lesson for them, if not for yourself. By asking for donations, or having your guests actively set a goal with your child in lieu of presents, then you are teaching yourself and your family about the importance of ACTION. 

For Instance, if your child wants a trampoline, then instead of presents or just GIVING your child a trampoline, your child can actively save up to achieve that goal! Using their chores, their party, and all of your collective resources to earn that trampoline. This instills action, goal setting, working for their achievements, and so much more!

All the Lessons We Can Take Away from the “No-Gifts” Royal Party

There are lots of truly important things we can learn from the royal “no-gifts” party. Whether we want our children to learn about setting and achieving goals, whether we want to reduce senseless waste, or whether we want to save money and break the gift cycle, there are so many things we can start to change! All it takes is action.

Lending Club Returns

Many peer to peer loan investors count on clear and accurate reporting from the P2P platform to validate their P2P investing strategies. In this post, I would like to discuss Lending Clubs rate of return reporting, how investors should interpret this piece of data and how it is useful in assessing the success or failure of your investment strategy. If you are a Lending Club investor then this is certainly something that you want to be familiar with and monitor on a regular basis. 

Lending Club calculates what they call Net Annualized Return for all investor accounts. They define this as “an annualized measure of the rate of return on the principal invested over the life of an investment”. In layman’s terms, this means the rate of return on an annual basis of the account balance. If the actual return is 10% in 6 months, then the annual return would be 20%. If the actual return is 30% over two years, then the annual return would be 15%. 

lending

Since loans are always being added or paid down, and interest is received, the calculation can be very complicated. Annualized figures are normally based on average daily value of and account. Therefore, it is very good for every Lending Club investor that this information is provided. Having to do these calculations oneself would be a very difficult and time-consuming part of lending club strategies

Rate of return is also impacted (usually very significantly) by loans that default. Since the remaining principal is lost, the effect on rate of return is large. Loans generally default before most of the payments have been made so investors need to be aware of this possibility.

One way Lending Club has of help investors recognize the potential impact of loan defaults is a piece of data called Adjusted Net Annualized Return (ANAR). ANAR projects loan defaults and determines what the rate of return will be if those loans actually do default. To understand how this is determined, you must know that Lending Club tracks loans by status: Current, Grace Period, Late 16 to 30 Days, Late 31 to 120 Days. For each of these categories Lending Club has determined the likelihood of the loan defaulting. This is based on all previous loans that have been in those categories. When calculating ANAR, these percentages are included, thus adjusting the ANAR. 

For newer portfolios the ANAR can be significantly impacted by loans in any of these categories, even Grace Period. While the risk of default is low (about 25%), if the account has not had a lot of repayments then losing even 25% or the principal of one loan can make a difference. Fortunately, the investor can adjust the amount deducted from the balance in the calculation of ANAR. They do not need to use the default experience values provided by Lending Club. Many investors adjust these values and make changes over time.

Want to know more about investing on Lending Club and how to be successful? There is a wealth of information available on their site for new and experienced investors. In addition, you can learn more about P2P lending investing from Peer Loan Advisor. They are a team of professionals who are highly experienced in this type of investment. 

Can You Afford To Start Your Own Business?

If your current salary just isn't enough, it can be tempting to think that starting your own business and reaping the full rewards is all it will take to lead the lifestyle you want. However, before you make the big leap into going from being employed to being self-employed, it’s important to know whether your finances will allow for it. Here are some things to check before you begin. 

Have You Got Savings? 

No matter what type of business you want to start up, having money in your personal savings account is crucial. Even if you don’t need it to fund the business itself, you might need it to fund your own day to day living; there’s not many businesses that can make money right from day one – it often takes a little time (and in many cases a lot of time) to become established enough to provide a salary.

Start up business 

Have enough savings for a number of months (six would be ideal) so that your personal finances won’t suffer. You should also have enough saved to cover key upstart costs. Getting a professional website set up and marketing costs money you will need to pay out of pocket or through a loan.

What many people do to minimize costs which works rather well, is to start their new business as a ‘side hustle’. This way they still have their regular income, but they can also work on their new business in the evenings, early mornings, or at weekends. Once the new company is more established and making money, they quit their first job and work on their new one full time. It’s hard work, but it means you are financially secure. 

What Do You Need? 

If you've got the financial backup to start, or you’re happy to work two jobs at once, then you need to look into what your business is going to need. Computing equipment is always going to be important, but you might be able to utilize what you already have at home. 

Other equipment that is more specialist will involve an investment, of course. However, if you take your time and do your research well, you should be able to find low cost options that work wonderfully for you. If you need tools to create circuit boards, for example, you’ll find that you can get them at a great price from Altium without compromising quality. Use forums, reading reviews, and ask questions to ensure you don’t spend more than you need to for the best on the market.

What Do You Know? 

When you start your own business it’s crucial that you sell products or services that you are an expert in. That way, you can become more established more quickly, since you can prove that you are an expert in your field to potential customers or clients. You will also save money this way since you won’t have to pay for any additional training or a higher education course. Instead, you can wow your clients with your resume, and build an effective brand for yourself from day one.

5 essential money podcasts to listen to in 2019

By now you've probably heard about the phenomenon that is podcasts, even if you haven’t become a podcast addict yourself just yet. From politics to true crime and even comedy, there’s an endless span of topics for listeners to choose from. 

But what about podcasts for anyone wanting to delve into personal finance? Unsurprisingly, there’s no lack of listening options. Tom Watson, Money Writer over at mozo.com.au, has shared five of his top money podcast picks you’ll want to tune in to this year.  

Planet Money 

Length: 20 minutes 

If you’re already immersed in the world of podcasts, chances are you've come across one of NPR’s (National Public Radio) shows. And for anyone with an interest in money and the economy, Planet Money is the pick of the lot. 

money podcasts

The twice-weekly podcast takes listeners into the wider world of economics, with a variety of wacky and interesting topics including a glimpse into espionage and collusion in the raisin farming industry and a history of the minimum wage. Trust me, they’re both excellent! 

This is a great podcast to pique your interest in the way money permeates so many parts of life, plus at 20 minutes long each episode can be easily digested during your commute. 

Breaking Banks 

Length: 55 minutes 

Open banking, blockchain, digital wallets. Don’t worry if these terms mean nothing to you, because the Breaking Banks fintech podcast will bring you up to speed in no time. 

The weekly podcast runs through the latest and most interesting developments in the world of banking and financial technology, and is essential listening for any banking and fintech junkies. But if you’re just getting started, don’t worry, it’s equally digestible for anyone curious about the future of banking and finance. 

Stacking Benjamins

Length: 70 minutes 

Money and personal finance can be subjects many people just don’t want to think about, let alone listen to an hour-long podcast on. But there’s one show that makes these topics not only light-hearted, but often laugh-out-loud funny - Stacking Benjamins. 

With a new episode every Monday, Wednesday and Friday, hosts Joe and OG take listeners through issues such as retirement, real estate and managing debt in a way that makes it feel like you’re just listening to friends - while you’re actually learning about personal finance! 

The Dave Ramsey Show

Length: 40 minutes

Hosted by businessman and author Dave Ramsey, this podcast tackles the practical personal finance topics that crop up in everyday life, such as setting up a budget and saving up for a car. 

Dave takes calls from listeners with real questions about their financial lives and dishes out straightforward advice to help them get back on track. And with new episodes almost every day, it’s easy to pick and choose the topics that interest you the most. 

Freakonomics Radio 

Length: 55 minutes

You may recognise the name - that’s because Freakonomics Radio is from the same guys who wrote the best-selling 2005 book Freakonomics. Like Planet Money, this is a podcast aimed at providing a deep dive into socio economic issues you’d likely never think about yourself. 

With topics such as ‘How to be happy’ and ‘The stupidest thing you can do with your money’, host Stephen Dubner takes listeners on a different 55 minute journey each week with commentary from a range of experts and academics. 

About the writer: Tom Watson is a Money Writer and banking expert at financial comparison website mozo.com.au. A self-confessed podcast lover, Tom is passionate about sharing tools and information with others to help kick start their own personal finance journeys.

How to slash your food budget

While it is agreed that food is a basic need, data from the Food and Agriculture organization shows a third of what gets produced is wasted. It is likely that you are contributing to this waste meaning that you are losing money. One way to help cement your decision to cut your food budget to perhaps even more than half is getting a reality check. Every food item that ends up in your bin is you throwing money in the bin. That is money that could go into savings, or pay for that thing you've been saying you’re too broke to purchase.

food budget

Once the truth hits home, consider adopting the below steps to help spend less on food monthly.

Create a meal plan

Not having a meal plan in mind could be the reason you’re wasting money. Going grocery shopping and purchase food both perishable and packaged based on what you think you might want to eat leads to waste. Consider how many times you've had to bin veggies and fruits because you didn't get round to using them? However, with a meal plan, you know exactly what you need and the quantities to prepare the meals. Also, don’t forget the snacks. Done weekly or monthly, you’ll immediately notice the savings and reduction in food waste. 

Go back to basics

Choosing between making a fancy meal and doing the old feels like a child custody mediation process; which one will land on your plate? There’s an easy way. There are myriads of sites and apps that show you how to make tasty meals with five or fewer ingredients you can find on your pantry at any one time. You can still be gourmet on a budget and stick to dishes with multiple components for special occasions. 

Have a grocery list

From the meal plan, you will know what to purchase. However, some things stay on the shelf longer, and you’re likely to forget if you don’t make a note. Apart from what your recipes require, keep a list on the kitchen counter top or a fridge magnet to write down what’s depleted. When you go shopping, that means you won’t have to guess what’s left and what isn't to avoid having excess food at any given time.

Eat before heading out

When you’re hungry, quick meals and snacks seem like a great idea. During this time you’ll convince yourself that the extra-large bag of pretzels will make a perfect snack for days you equally feel hungry. We often go into an entire rationalization process that has us purchasing more than we need. You don’t need that extra chocolate bar.

Why the professional traders trade with a big sum of money

The world of trading is completely different. Unless you become a successful trader you will never understand how it feels like to become financially free. Many people often start trading with $100 and dream to earn huge amount of money. This is nothing but an absurd step from an immature trader. The professional traders always love to trade with a big sum of money. Though many brokers offer high leverage trading accounts, but dealing with the market leverage is extremely risky. This is just like a double edge sword. So if you have enough money to invest, it’s better to trade with a very low leverage trading account. This will significantly reduce your risk exposure and help you to earn huge money in the long run.

trading

Reduces your risk exposure

Before you dig deep into this section, we are assuming that you have complete control over your emotions. If you are completely new to this trading profession, investing a huge sum of money will never help. In fact, you might even blow your trading account due to some silly mistake. However, if you have a decent experience, you minimum account balance should be at least $2000.To be honest, this amount is actually not good to ensure a high standard of living. And the leverage of your trading account should 1:10. Once you have the right setup, by securing 500+ pips per month, you can easily earn $500+ (assuming you will be trading with 0.1 lot). But make sure you are not risking more than 2% of your account balance in any trade since the outcome of each trade is completely random.

Helps you to become a position trader

There are two basic types of trading strategy in Forex market. The aggressive traders love to scalp the market and usually, they have a very small account. On the contrary, the expert Aussie traders with a big sum of investment in their online trading account always prefer conservative Forex trading style. They are not concerned with high-frequency trading rather their main focus remains on quality trade execution. Once you start trading the higher time frame data, you will find a simple problem with your stop loss. Most of the time you will have to use a wide stop loss to give your trade enough space. So without having a decent balance, you can’t use big stop loss without unless you violatinge the rules of money management.

Helps you to earn decent money

Though trading is a very complicated profession thousands of traders join this industry every day. If you can truly develop the right skills, you can easily earn a decent amount of money from this market. But to support your family you must have a big trading account. Some of you might use the leverage trading account but this will significantly increase your risk factors. For the first few years, you should be more concerned about the leverage selected in your trading account. Under no circumstances, you should you trade with a leverage higher than 1:10. This will stop you from executing big trades which might ruin your investment. So, it’s very important to have a decent account balance, as you need to trade with a standard lot to earn a decent amount of money.

Makes you a confident trader

Trading is all about managing your risk factors with a strong level of confidence. Unless you trade with a big sum of money, you will never become a confident trader. Let’s say you have started trading $100 and you have lost your investment in a single trade. Do you really think you will learn from your mistake? The simple answer is NO. On the contrary, if you trade with $2000, , the chances are very high you will care about your investment. And this will help you to learn new things about the market. Without being a devoted trader you can't survive in this profession.

The best time to quit Forex trading

Though this industry is attractive and there is a huge chance to make the profit, it is not sensible to keep on trading when losing money has become common. There are many signs and indicators that can tell this is the right time to quit trading. The investors do not think of ending the career for greed. These people want to make the profit and will stop at nothing to achieve the goal. If a car keeps on running with broken parts, it will soon see the end of the world. This article will tell about when it is better to quit trading. The money can always be spent anywhere and on any industry. It is not important that investment should be made in Forex.

Forex trading

Though Forex trading is one of the most lucrative businesses in today’s world it doesn't mean you will become a profitable trader. Many people in the United Kingdom have lost a huge amount of money just by trading the market. The smart investors always know when to stop investing.

When there are continues losses

Losses are common but it can be also a sign that trading is not for you. If there are many losses in the account, it is time that decisions are revised. Most traders want to keep on trading because of the investment. The professionals keep on making the profit and any time not spent on the industry is a loss. That is why the people can keep going on the market with continuous losses. If there are excessive losses, keep in mind that it is better to close the trading. If not prepared, take a small break and give time to realize the mistakes. Most mistakes are silly if there is no fault in the strategies. As traders focus on developing the strategy and the analyses, these petty mistakes are ignored and pay a heavy price. Try to work and correct the mistakes but if there are still problems, it may indicate the time to seek other investments.

Becoming a professional trader in the Forex market requires precise knowledge and skills. Currency spread betting is not like gambling. You need to be calculative risk takers to make consistent profit from this market. Those who are looking for quick profit from this market should immediately stop trading the market.

If the volatilities are not understood

Not every market is for everybody and this has to be accepted. If the neighbor is making a fortune with the Forex trading, there is no guarantee you can also do the same. If the volatilities are not understood or it creates confusion, try to take lessons from the professionals. These people will clear the confusion and it will be easier to trade. However, if there are still losses and the volatilities which are puzzling, think of the other opportunities to invest and get a fair return of the investment.

If giving time is a struggle

A successful trader needs to give a proper amount of time to develop a strategy that can be used with the trends to make profits. Lazy people try to skip the practice and copy the plans of others. This is not going to work if success is the goal. Make sure that enough time can be spent every day to practice the strategy and develop your skill. If it is not possible and the account is only kept open, quit the trading. It will only waste the time and also the money.

The trends simply do not work out

There is something called luck that the people cannot escape. If the bad luck does not leave and there are always losses even with the right strategy, wait and analyze it sometimes. If the bad luck still continues, withdraw all the money and forget about trading.

Emergency loans you’ve never heard of – Use them to get back on your feet

There are indeed several kinds of emergency loans which become necessary for anyone at some point of their lives. Not all are able to keep the right balance between their income and expenses and whenever the expenses shoot up in accordance with the income, they fall short of funds at the middle of the month. Dental and health issues are two of the most common reasons why some of us require emergency funds. Car and home repairs are 2 of the other reasons which can make an individual or a family to instantly run for cash.

Emergency loans

While there are different ways in which you can get this cash, not many are aware of the options. However, you also need to know that each option has its own limitation and requirement. If you’re someone who isn't aware of your emergency loan options, here are few that you may keep in mind.

#1: Credit card cash advance loans

Did you know that the credit cards that you use can also let you get cash advance loans? In fact, utilizing your credit card along with this feature is certainly the best way of getting a small loan as you can grab immediate cash. Nevertheless, you can only get such a loan if you possess one of these cash advance credit cards and if you have available credit on the card. When you need to pay money during an emergency situation, this can often be a viable solution.

#2: Payday loans

As the name suggests, you get this kind of loan for a short term which is usually till your next day. MicroPayday Loans offer you the best loans at the most competitive rates. However, if you think that you will get the proceeds of this loan at a reasonable interest rate, you’re wrong as they carry outrageously high rates due to the risk factor. The lenders don’t even check your credit before lending you the loan and all they check is whether you earn enough to pay back the loan amount. Hence, they charge you high rates. But if you could pay back the loan on time, you can play it safe. You may also check out www.PaydayMe.com for payday loans.  

#3: Car title loans

Someone who possesses a car which has got a clear title or a title which has been paid off can get a car title loan. Such loans are popular as you can get them easily and they also offer you fast cash. It isn't a requirement that you should have good credit but the value of your car will be determined to decide the total loan amount that can be given to you. You can continue driving your car even after taking a title loan and the proceeds of the loan are also received within a day or two. 

Therefore, now that you know the ways in which you can get emergency finance loans, you should no more worry about financial emergencies. Just have the capability to pay back the loan on time so that you can avoid falling in debt.

What Skills Do You Need as Home Health Aide Apart From Your Certification?

A home health aide improves the quality of life for patients who may be dependent on others for the simplest everyday tasks. A competent aide does not just provide medical support or pain relief to such a patient but can offer companionship and promote mental well-being significantly simply by lending a sympathetic ear or by showing compassionate care to them. Immensely satisfying as this job is, it is also quite exciting because you have the opportunity to constantly push your limits, test yourself, and also improve your own skills with each assignment that you take up. While this can make the job very challenging, it can be somewhat intimidating for those who lack the key skills that are essential to succeed in this line of work. 

health care

Apart from the qualifications and training you have for carrying out medical procedures (for example, wound care or administration of medicines) as a home health aide, you also need to have a number of soft skills. Take a look at a few of these that can make a difference to how sought-after you are as a home health aide: 

Empathy and compassion

The obvious soft skills that a home health aide needs are compassion and empathy. The patients you care for are likely to be struggling with myriad negative feelings arising out of their ailment or their inability to be independent. Unless you can understand how they feel and can empathize with them, you may inadvertently make them feel worse while you carry out your regular duties. A genuine concern and interest in the patient’s mental state and emotional state would help you give them the kind of care that is truly beneficial to them on many levels. 

Patience

A person suffering from a disability or ailment may be in constant pain or discomfort although it may not be evident on the outside. Some patients may be fortunate enough to avoid these issues, but the feeling of helplessness they have can make them very frustrated, prompting them to be unreasonable or irascible. For example, an elder with dementia may exhibit aggressive behavior, refusing to eat. You have to be patient with her and ensure that she gets the adequate nutrition her body needs. A home health aide needs to have incredible patience in order to deal with such patients with firmness but consideration and kindness too. You may even need to exhibit patience with the family members of your patient in situations where they do not understand why you are dealing with a situation in a particular way. 

Communication

Communication is the most critical of interpersonal skills that you might need for your career as a home health aide. After all, you have to be able to convey to your patients what you want them to do, explain what you are going to be doing and also help them express what they need or what they are feeling. Again, it is also necessary for you to communicate with the family members effectively and clearly when they have queries about caring for the patient or about your work. For example, the family member may express his anxiety about meeting the costs of hiring you for a long term. You can give them a quick rundown of various options they have of hiring part-time aides or suggest financial help options, like those suggested in this quick read about paying for home health care

Wrap

The crux of the matter is that, as a home health aide, your nursing training and qualifications are not the only things that can help you achieve success and credibility here. If you can hone these soft skills alongside, you enhance your chances of earning the trust and admiration of your clients easily. 

How to Borrow with Bad Credit

Sometimes life just throws everything at us. You get a divorce; your car breaks down, everything happens at once. One thing leads to another, and you miss a payment, then another. Next thing you know, your credit score takes a hit. You did not plan for this, it just happened. Now you need a loan, but how can you possibly get one with bad credit? Here are a few options to consider.

Get A Co-signer

Ask a trusted friend or family member with good credit to co-sign the loan. That trust must go both ways because if you miss your payments, your co-signer will be held responsible and it will affect his or her credit score as well as yours. Make sure you can make your payments on time!

Bad Credit

Online Personal Loan

Online personal loan providers do not take into account your credit score. They verify that you have a steady job and the means to repay the loan. The payments are then spread out on a period of three to four months. The downside to online personal loans is that they have high interest rates, but if you use it as a one-time solution to bail yourself out, it might come in handy.

Family and Friends

Borrowing from family and friends is never easy, but it can be of great help when in a tight jam. Prepare yourself beforehand. Make a budget to show that you are serious about your finances. Sit down with your friend or family member and explain your situation to them. Be honest and tell them precisely what bills you will pay with the loan. Suggest a payment plan to them and see if it suits them. Offer to pay interest. Although they might refuse, it shows your appreciation. Put everything in writing. It will prevent misunderstandings and falling outs. Moreover, last but not least, stick to your repayment plan. Not paying your debt to friends or family will put a damper on your relationship.

Secured Loan 

A secured loan is not as strict with credit scores as an unsecured loan, the reason being you provide collateral as insurance. The collateral can be your house or your car, or any other property that has enough value. The collateral lowers the risk for the lender so they will be more willing to lend you money even with a bad credit score. You will also pay a lower interest rate, which means that you could clear other higher interest debts with this loan. If you make your payments on time, you will improve your credit score which will give you better opportunities in the future. The risk for you is that if you do not repay the loan as agreed, the lender will be able to seize your collateral. It is only a last resort, but the risk is still there. So make sure you can manage the payments.

When all is said and done, it is possible to manage for a time even with bad credit. The thing to do is not to stay down, but to get yourself back on track and work towards improving that credit score.

Why An Assisted Living Center is a Good Investment

Sometimes the health of a person gets so bad that it is very difficult to take care of themselves and they need a nurse to help them do everyday tasks such as bathing, eating, getting up or sitting down. Stairs can become impossible to get up and down, and they are at risk of falling and breaking or dislocating a bone. Nursing homes are ideal for those who have poor health or who need special attention such as those needing dialysis or medications throughout the day.

There are close to 76.4 million baby boomers in the United States or about 26 percent of the population. There is such a large population of baby boomers possibly due to the end of World War II. Baby boomers are those who have been born between 1945 and 1965 and they are hard-working individuals who often work past the age of 65.

home

As many of these baby boomers get older, they sometimes find that it gets more and more difficult to live on their own. As they age, they may need to make more trips to the doctor and transportation can become very difficult. They may also be at a higher risk of falling or getting injured or may need to take medicine at certain times of the day. It can be more difficult to remember to take medication as many elderly people tend to have a harder time remembering things.

There are some elderly that cannot live on their own but are still quite active and can do many of the daily things necessary to take care of themselves. These folks might consider a Residential Assisted Living center. They are ideal for those who need transportation arrangements or who would greatly benefit from having a nurse on call, but who do not depend on one for most tasks. Assisted living centers often have many opportunities to socialize and they have guests come and visit and perform musical numbers or share other talents. Social interaction is very important for anyone and especially the elderly. Social isolation can lead to depression and is a very serious condition.

From an investment standpoint, an assisted living center would make a good investment choice. There are so many baby boomers that are likely to move into assisted living homes in the near future as they get older and need more help on a daily basis. Many elderly people do not have children who live nearby that they can depend on to look after them, and they can no longer live in their own homes. It is also a good investment choice. Just like supermarkets, there is always going to be a need for them. They are in high demand because many seniors would like to live in them.

They wouldn't have to worry about taking care of a home, which can be very taxing and even expensive. They like the idea of having the freedom to come and go and live on their own but don't have to deal with the headache of owning a home. As an investor, you don't have to worry about finding renters because there will always be a very high demand for space in your assisted living center. They are also relatively self-run. You can have the staff do most of the daily jobs, such as cleaning and maintenance, or hire a company to take care of those particular jobs. A great deal of your cost would be in the nursing and skilled staff that you would have to hire. 

Assisted living centers are anything but hospital-like. They are more like a home away from home. They are striving to offer all the amenities and comforts of home, but have the added peace of mind of a nurse on site around the clock in case their services are needed. The seniors who live there have their own room. The staff will help those who live there with any daily activities that they need. They are free to leave to go shopping or to complete other tasks. Many also offer entertainment, exercise programs, such as yoga, and they even have security. They also have housekeeping and prepare the meals for their tenants. These two tasks can become difficult and even dangerous for those who are very advanced in years. Consider an assisted living center for the needs of your loved one.

The Four Essentials To Learn Before Investing

If you’re thinking of making your first investment, it’s natural to hesitate. You may be thinking: is this the right time to buy? Prices go up and down and if you don’t have experience of following the tickers it can be hard to know whether or not you’re about to make a mistake.

Well, the good news is there are four essential pillars that should be in place before you commit a penny of your hard-earned cash. Get these right first, and you’ll be on the road to making the right choices with your money.

Step one: how much time do you have?

The most basic mistake a novice can make is to invest without a plan. You wouldn't set out on a road trip without knowing where you want to end up, so before you commit your funds, you’ll want out figure out your end game. Knowing how much money you want to make is only one side of the coin. Understanding this from the very start can prevent any major setbacks looking forward. 

Investing

On the flip side, you need to figure out how much time you have to make that money. For example, are you going to need funds in 10 years when Junior goes to college, or do you need cash soon to meet an IRS demand? Your personal situation is going to determine the route you take. Once you know how much time you have, you can ask yourself the next question.

Step two: how much risk can you handle?

There’s an adage that you should never gamble more than you can afford to lose. That said, some investments are riskier than others. Once you know your end game, you’re going to want to assess your own appetite for risk.

When it comes to investing, there’s a well-documented relationship between time, risk and reward. Your own tolerance for risk is probably one of the most important factors in your success so, rather than guess, you should look to the end game you already set yourself to help you figure this out.

For example, the more time you have to reach your goal, the more you can afford to take a risk, as the longer you keep your money invested, the more time there is to recover from any down markets or bad stock picks.

There’s even better news. Time is not only on your side when it comes to reducing risk. Having more time can also bring greater rewards. This is because the longer you have to reach your goals, the more you stand to grow your returns exponentially from compounding your earnings.

On the other hand, if you only have a short time to reach your target, then you’re better off going with a safer investment.

Step three: spread your risk

There’s a reason we don’t put all our eggs in one basket. If the basket falls …Well, you get the picture. No matter how well you figure out how much time and risk you have to play with, any potential rewards are negatively impacted if you simply stick with one stock, one industry or one asset type.

Once you figure out your appetite for risk you can begin to allocate your funds to different asset classes. This is where some initial investor education is critical, because it literally pays to know which types of investment hold the greatest risks and the greatest potential rewards. Here are the three main asset classes:
  • Cash and money market funds. Your main goal here is stability. This is a very safe investment, meaning you are unlikely to lose money, but the returns are small. The main risk here is that you could earn money more slowly than inflation rises.
  • Bonds and bond funds. This is the investor’s middle ground. Examples might be US government bonds or international bonds. The goal with this type of asset is to get a moderate return for a slightly higher risk. The main risk here is due to the fact that bond prices fall as inflation rises. This means that if inflation rises too far, the issuer may not pay promised dividends or be unable to pay you back your principal.
  • Stocks and stock funds. This is the riskiest type of investment but brings the greatest potential reward. The risk here is around falling stock prices, due to poor company performance or negative market sentiment. The stock market is very jittery and sentiment can be affected by all kinds of adverse news stories, political events far away and sometimes even the weather. To add to this, falls in stock prices can be much deeper than falls in bond prices. 
So, these are your main classes of asset. If you had a very long time to reach your investment goals you light get away with a stock-only portfolio, but as a general rule, when allocating your funds, it pays to spread them across all three investment classes. There is no magic formula here, the mix will depend upon your own personal appetite for risk and your personal end game. 

As well as spreading your investment across asset classes, when building your portfolio, it pays to spread within asset classes. For example, domestic and international currency or bonds, varying industry types and so on.

Step four: understand your costs

So now here’s the bad news. Every investment comes with a price tag and, even worse, the money that you pay out to costs will compound over time. For example, paying 2% of your principal investment may not seem like much of a loss, but once your returns start compounding, 2% is going to be a lot more money.

So it’s critical to understand what you’re paying and how to manage your costs. Counter-intuitively, funds with lower costs tend to outperform those with higher costs.

So, if you’re wondering if it’s the right time to invest ask yourself: have I ticked off this four-point checklist? If the answer’s yes, well there’s no time like the present.