Yes, this is a good idea! I know you want to know what is mad money? Well, a long time ago this term came about when a young lady went out with her friend to a party and her friend left her at the party with no way home. So, the young lady was mad with her friend that left her at the party and luckily for her, she had money stowed away in her shoe to take a cab back home. She thought to herself on her way home in the cab, that it was good that her mother had taught her to always have money set aside for emergency situations such as this!
Thank goodness, this young lady had the forethought to stash her mad money away so she could take a cab back home, since her friend left her in a lurch. Get the point? Having an emergency fund whether it be mad money or saved money is important for you to have. You say, how do I go about doing this? Well, you can read these tips to help you learn what you can do:
1) Set up a savings account specifically for your emergency fund or mad money fund. Whatever you want to call it, just establish one!
2) Deposit a certain amount of money on a weekly, biweekly, or monthly basis in your account. You may want to set up automatic deposits to your account via your payroll department. Or, you may want to have your bank automatically withdraw a certain amount of money from your checking account into your emergency or mad money savings account.
3) Try to save at least 2-3 months of your monthly salary to cover your bills for at least three months if you were to loose your job. This amount of time will hopefully allow you the cushion you need until you secure new employment.
4) The money you save in your emergency or mad money account should be used for household emergencies, personal emergencies or if youre no longer able to work. Dont use it for other expenditures such as bills, travel, etc… Get the idea? Its a savings account that you dont want to touch unless its absolutely necessary!
5) Make sure the bank account you put your emergency or mad money into, is paying you the most interest you can earn for this account! Research as many sources as possible on securing the best interest rate you can get. Check with your bank, the internet, newspaper and other sources for the prevailing interest rate. You want to make sure your money can be accessed easily and quickly if you need it for an emergency!
By establishing an emergency or mad money fund, this will give you a better peace of mind if you need access to money when there is an emergency in your life. So, the sooner you start setting money aside for a rainy day, the better off you will be! Make sure the amount of money you contribute to your emergency or mad money fund, is realistic for your budget. Save as much as you can without upsetting your overall personal or family finances. So go ahead, get started today!
Home Business Financing 3 Reasons to use a Credit Card to Fund Your Home Business
Would you like to start your own home business but do not have the money for it? Well, you are part of a club with many members. You may think getting money for a business can be a monumental task. However, it does not have to be. If you anticipate and plan for as many expenses as possible you may want to consider using a credit card to finance your home business.
One of the easiest ways to get a loan for your home business is to apply for a credit card account. It may not be the answer you are looking for. However, credit cards are easy to receive if you have decent credit. Plus they are very flexible in using for spending purposes. Consider these three reasons for using a credit card for your home business.
The most important reason about having a credit card for your business is you get to keep your cash assets. Even though there is a risk of acquiring debt, you still get to keep your cash in the bank for a rainy day. I find this a very valuable benefit because you keep your familys money in tact and reserved for family needs. Your savings will continue for its original intentions (i.e. college money for kids, school clothes, etc.).
Another benefit is that Credit Cards have itemized statements of purchases. This is great for keeping track of money you spend on your business. The itemized statement provides proof that the Credit Card is being used for business expenses. Also, if you use the credit card for all of your purchases you can easily report expenses when tax season rolls around. Payments made that are shown on the statement is proof where your businesses money is going.
Finally, and this is my favorite reason, you have increased purchasing power with a credit card. You can use a major credit card to purchase items almost anywhere in the world. Having direct access to the funds is much more flexible than a loan. This also provides flexibility in time management because you can use the credit card to purchase items at your convenience if you have internet access.
The downside to this is that the credit card minimum payment will be an additional expense. Also, credit cards are a very easy way to acquire a lot debt for yourself if you are not careful. Always practice good and sensible spending practices. Once you start a home business it is very exciting time in your life and you may want to spend money on lots of things that you think you may need.
Always think of the basic needs of the business first. I tend to be very frugal with spending on a credit card then I do with cash. One way to curb spending by asking yourself, Does my business really need this item right now? Give yourself an honest answer and empower yourself to cut down on impulse buying.
Try to think out of the box when getting funding for your home business. A credit card to fund your business start up expenses may make things easier for you. Also, there are many offers for low interest credit cards for a specified time period. So, if you need a few thousand dollars in capital to start and sustain your business for a while then credit cards may be the answer to financing the start up costs your home business.
We all know there is no such thing as free money (even a lottery win or a donation are not free as they require buying a ticket or some marketing to attract the donor which costs money). So how would one go about trying to get almost free money that lasts?
Well one way is to ensure that a good proportion of the money that you earn is designated to going into two things one is savings and the other is investments. Save for a rainy day is a common saying however with everything that is happening in the world saving is not enough we all need to plant seeds that will grow over time and compliment the savings.
With investments you can be an armchair investor or an active investor that choice is up to each individual and their risk appetite. There are many ideas for investing unfortunately a lot of them require a lot of money to start with and some need you to practically have a degree on that subject! I have come across one market that is little known by the common individual which offers a wealth of benefits to its participants.
The market I was referring to is also very straightforward and that market is the Currency (Foreign Exchange or Forex) Market. This market is the largest in the world; it is not trading in any one place and it trades 24 hours a day from Monday morning in Australia or Japan to Friday evening in the USA. There are a lot of things that affect the currency markets. Regardless of these the markets are very simple to follow and one can profit from them as long as they follow a simple system, with the understanding that small manageable losses will have to be incurred to make large, long term, consistent profits.
Due to the constant market it is the most liquid as well, meaning there are a lot of participants so you are not limiting your opportunity by being involved like you would with stocks & shares. Access to the forex is now available to the individual and at very little investment cost, some firms will allow you to start trading with as little as 300 (, $ or Euros). However, it is probably better to start somewhere near the 1,000 mark (and trade as if you had only 300). Also most firms do not charge a commission so for your small investment and some trading you could get some free money (profits).
How is the profit made? Most firms work on the basis of 100:1 margin which means for every 1 (, $ or Euro) you control 100! This poses a risk and a major benefit. If the price moved 1% on the day you will be making or losing the face value of the trade! Here is the good bit you can limit the downside by using stop losses you predetermine the level by how much money you are willing to lose if your decision should be wrong. You can even use this technique to protect your profits.
Forex trading is very simple if you understand the very basics. Should you wish to learn techniques and ideas there are courses available showing you how you too can invest actively to get an extraordinary return, over time this will provide for that rainy day with ease; lets not forget that it is commission free with most firms and with a small amount of initial investment capital you too can make your almost free money!
The reasons for mortgages or loans are because of the high spending rate of the people in USA. According to the news agency USA TODAY there seems to be a reduction in the saving rate of the people. The cash flow, which is quite slow, is one of the reasons and increase in the spending habit of the people. Another reason is that people having been borrowing against their assets But the biggest reason for our poor savings rate is that people have been borrowing against assets mainly their homes to get their hands on spending money. The median price of a home rose 24.5% from 2001 through 2004. The real boom period was 2005: The median home price half cost more, half cost less soared to $206,600 from $184,100 in 2004. Due to reasons and to tap the potential there has been an increase in the number of Lenders in the last few years.
The reasons of increase in the spending habit of the people is because of more gadgets and more luxury in order to get into more luxury people are using all their money into gadgets which ensures luxury. Increase in awareness and trying to ape the rich i.e. trying to get costlier clothing and accessories to feel good. The spending of the people is not in accordance with the income that they earn but is also eating into their savings. In a recent study it has been found that many people havent saved for their rainy day. There is very less or no emergency fund among people. The people who have retired have found that they have no fund to spend rest of their lives. The savings rate has drastically come down.
As said above to lay their hands on spending money, for emergencies, for building a house (without enough finance in hand) and for education that the there has been an increase in need to borrow money and hence increase in the lenders. Though reasons like building a house or education loan is quite understandable in nature and is also repayable within the fixed period of time. It is only the increase in the loan for emergencies and spending money that is worrying a lot of economist. This increase can only be tackled when the people learn to live within their income.