An Unconventional Guide to Paying for College

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How Small Investments Can Turn into a Meaningful Savings When You Are a Student?

Posted by on Nov 7, 2017 in Saving Money | 0 comments

invest money

It is not uncommon to find student with a small debt or a big one in college. When contemplating how to get out of debt and ultimately, transition into the ability to become an investor, one has to make a dramatic shift in their finances in order to get ahead. Consider the following recommended steps to get out of debt and then position yourself in order to make a substantial amount of capital.

Debt Elimination

Debt elimination is the first necessary step a student should take before deciding to invest. It is essential to pay off high interest credit cards that typically have a 30% interest rate before even considering saving and investing. Additionally, it is beneficial to pay off personal loans or any student loan that have high interest rates before trying to pay money into a savings account. Once the debt is eliminated, it is wise to then set money aside for a savings cushion in order to pay your future college tuition payment or to allow for the unexpected to happen.

Three Months of Wages in Savings

Before investing in any options, it is best to have at least three months of wages in savings. Once there is enough in savings, then one can consider the best way to invest other money. Those students that fail to save will find it very difficult to get out of debt in the long term because they will never have a support system of finances to assist them should them need it. Their savings is vital should they decide to avoid high interest credit cards and personal loans all together.

The Recommended Quantity of Savings per Month for Students

In determining what is the proper amount of capital to save every month, it is essential to ascertain what one’s income from their part time student job, in relation to what their realistic living expenses are including their college tuition payments. The recommended savings amounts can range anywhere from $10 to $500. What is important to consider with this calculation is that even saving smaller amounts of capital per month absolutely is worthwhile because it will add up in the long term. What makes saving difficult is that the smaller amounts of savings are going to take longer to amount to a substantial amount of money. Typically, it is only through saving amounts in excess of $500 should one look into the possibility of entertaining the notion of investment and forex trading. The reason for this is that the currency trading market has very high stakes and the prospective investor should not be worrying about losing capital in order to be ready to be making such expensive and high profile trades that have very high risks associated with them. Perhaps an investment with low risk can be more adequate for students at this point. However, one can choose to make an investment with higher return. Be sure to know that the risk is higher as well.

High Risk Investments

For those student who are more advanced investors and that do have the potential to lose a great deal, currency trading and binary options are the latest potential ways to make a substantial amount of money. Currency trading requires specific level of knowledge in order to make substantial gains. Where this type of trading becomes very high risk is between individuals that do not know enough about the market in order to make sound trading decisions.

Binary options are a form of investing that should be avoided because there is a great deal of risk associated with these transactions that makes it very difficult to make substantial gains without incurring a great deal of loss. Binary options are reserved for the experienced traders that work at reputable companies. Should one have any doubt about the integrity of a financial company, they should not trust their binary options are very unregulated in markets that are outside of the United States. Where binary options are quite difficult to get ahead is that they are the notion of buying an option on a stock that will be profitable if the market swings in a certain way. Thus, there is a potential that an investor may not even make a profit. Instead of utilizing binary options, investors should be focusing on a more ownership based strategy to do well in investing.

Concluding Remarks on the Subject

To conclude, it can be quite difficult to get out of debt, especially in college. The reason that it is so difficult to get out of the red is that there is a vicious cycle that continues when a student spends more than they have and then pays subsequent interest on those charges. The best way to get out of debt is to pay off the high interest debt, save at least three months of wages, and then consider the amount of savings per month towards investing should the student have the requisite capital to do so. Then, if he has sufficient capital to invest, they will then be able to get ahead in their investments with potential currency trading strategies. That being said, these strategies are best left to the experts in order to get the best possible results for financially qualified individuals.

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Should You Buy a Home During College?

Posted by on Sep 21, 2017 in Saving Money | 0 comments

buy a house

Having your own home comes with a wide range of benefits. There are tax deductions you can take as a homeowner. The cost of a mortgage is often less expensive than the cost of renting. You can gain an income if you choose to rent out a portion of the home. You’ll be building equity rather than just “paying rent.” These are just a few of the reasons out there that prove that home ownership can be a huge benefit to you as an individual. However, there are also many drawbacks. So, when is the right time to commit to buying your home?

Buying a Home During College

Owning your own home gives you peace of mind. You will always have a place to stay, there will be no moving around from apartment to apartment. You’ll also know that you’re building equity and investing in your choice – another set of benefits that will add value to your life. In recent years, there has been a trend of college students striking out and buying a home during their school years. But is this even a possibility? And if it is – is it wise?

College-age students have many reasons that could spur their desire to buy a home. First, real estate is a fantastic investment. If they choose not to stay in the area after college, they can always turn their home into an investment property. Even when they are staying there, if their home has more than one room, they can rent rooms to friends or other reliable, trustworthy tenants to make an income and pay for their mortgage payments as well as the cost of owning a home (like maintenance, etc.)

Additionally, college students who purchase a home often end up saving money in the long run. Rent in college towns can be very expensive. Rental agencies and leasing companies have the advantage – they know that students need housing, there is usually less housing available than is needed, and so they can increase prices to a very high rate. A mortgage will likely have a less expensive month-to-month payment. This helps college students cut back on costs. Additionally, if they do choose to rent out rooms, they can put the extra rent money back towards their mortgage, effectively paying it off much faster. Renting your rooms (or even the entire house) while taking an overseas job during your gap year, could really mean one year of huge savings.

Of course, there are also drawbacks to buying a home in college. If you are college-aged and can’t afford a down payment for a home, or if you don’t qualify for a good interest rate on your mortgage loan, don’t purchase a property. Of course, it also goes without saying that home ownership comes with challenges. You will have to be willing to put the energy into fixing up the place for renters, making any necessary repairs, etc. This added responsibility may not be what you’re looking for.

When Else Should You Consider Buying a Home?

buying a house

There are no hard and fast rules as to when you should or shouldn’t buy a home. However, a few good guidelines are:

  • Consider buying a home if you’re currently in a “buyer’s market.” If houses are selling for much less than their value and you’re willing to sit on your investment for a while before selling, buying a house or a property may not be a bad idea.
  • Build up enough savings for a down payment. Whether you have 10%-20% saved, make sure you have at least a reasonable portion of the overall home’s value saved up for a house down payment. This often helps you to lock in a lower mortgage rate, it helps you to take out a smaller mortgage loan, and it reduces your overall debt. Is never too early to start saving.
  • Consider buying a home if you’re in a good area where the rental market is good. This is why college towns are such good candidates for purchasing homes at as a college-aged individual and using them later in life as a rental property for extra income. With rents constantly increasing, you’ll likely be able to make an income on your property or pay it off much faster if you purchase in an area where the rental demand is higher than the house-buying demand.

If you’re a recent graduate, or you’re currently in college, you may be in the prime time of your life to purchase a house. If you’re considering taking this step, ensure that you’re financially capable of doing so. Finally, ensure that you’re purchasing a home that’s worth purchasing. In other words, don’t jump on the first one you find! Take your time and weigh your options – real estate is an excellent investment, but only if you invest in excellent real estate. Look around carefully and find the home that best fits your needs and budget. Only you can make the best decision for your financial future.

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When Should College Students Start Looking for Their “Adult” Job?

Posted by on Jul 13, 2017 in Getting Started | 2 comments

Adult job

It’s something that every college student starts to stress out about during their educational career – when do you start to look for your first “adult” job? The job search can be incredibly time consuming and overwhelming. Many students might feel discouraged by their prospects, or maybe they’re expecting a job to fall into their lap just because they’re on their way to earning their degree. However, especially in today’s world where it’s not always what you know but who you know, job searches are much more about networking and pursuing opportunities with people you know or could potentially be introduced to. So, knowing that your job hunt might take a little longer, do you start to look for an “adult” job while you’re still in college? Or do you wait until you’ve graduated and have your degree in hand?

The Difficulties of Job Hunting

We live in a very connected world. Even if you’re able to find a job posting on a website or in the paper, it’s likely that the poster already knows several people or can be introduced to several people who are the ideal applicants. However, don’t allow yourself to be consumed by the doom and gloom rumors that all college graduates struggle to find a job. In fact, only 2.5% of college graduates are unemployed as of a January 2017 survey. That doesn’t mean the job search is easy or that there are jobs out there that are a perfect fit for everybody, but there are ways to deal with the difficulties of the job hunt.

It may be tempting to put off your job search until after you graduate. Logically, this might appear to make sense. Ideally, if you focus your time while in college on your studies, your grades will be better. Better grades mean a higher GPA, and that should mean a higher likelihood of finding an amazing job after you graduate. This logic is faulty. While GPA is a factor, most places of employment aren’t going to be scrutinizing your college transcript. Just seeing that you earned a degree is usually enough to qualify you for employment (unless, of course, you’re going into a very high tech or niche-specific field).

If we look at how job hunting works these days (78% of college graduates say that networking played the largest factor in finding a job after college), we know one thing for sure: it’s time consuming. So, the right way to go about your job search is to start as early as possible while you’re still in college. This will ultimately save you money in the long run because before any student loans or hefty post-college living expenses kick in, you’ll already be squared away with a salary-earning job. If you wait to start job searching until after college, it’s likely you’ll take a bit of time to do so. During this time, you won’t be earning money, you could potentially be going into debt to pay for your lifestyle, and you won’t be putting any money towards student debt, savings, or retirement funds.

Timing & Experience

Timing is, in this case, the most important factor in finding a job. You never know who you’ll meet at a career fair, at a panel interview, or during a networking event, and you can’t really orchestrate the meeting with your ideal employer. These chance meetings aren’t premeditated. This is the reason you should start hunting for your job early on, to increase your likelihood of being in the right place at the right time. Of course, timing these meetings or being able to bump into someone who wants to hire you in the right place at the right time isn’t easy – if only because it’s mostly outside your realm of control. Regardless of how difficult this seems, keep pressing on. Continue to apply, send emails of inquiry, and attend networking events to maximize the time you’re spending on your job hunt.

Experience is also a critical factor in your job hunt. It can be frustrating for college students when it seems like all entry-level jobs have a high experience requirement. One way to circumvent this is by attending events within the industry you’re interested in.

Get involved early – a year or more before your expected graduation date with volunteer work, internships, networking events, and more. Although you’re a full-time student, this involvement will show very clearly that you have experience in the industry, know about the employers you’re speaking with, and you’re ready to jump into the workforce after you graduate. The job search is a stressful time, but it’s also an exciting time! Take advantage of events in your area to put yourself in front of the people you want to work for and eventually you will be working for them after you graduate!

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The Best Jobs to Do During Your Gap Year

Posted by on May 18, 2017 in Saving Money | 0 comments

job search

Whether you’re looking to take a gap year before you attend a university or after you’ve graduated university (and before taking on a long-term employment opportunity), there are a wide variety of exciting options out there for you. One major consideration for those looking to take a gap year is employment. Obviously, you’re not looking for something that’s a full-blown career position, but financing your travel is a must. So, what kinds of jobs exist for the traveler looking to do something interesting during their gap year? The answer is that there are many kinds of positions available to you, all of them holding a unique value (and all of them providing steady financial security during this time of your life).

Teaching English as a Foreign Language (Or Any Language)

If you’re interested in travelling with pay (and possibly having some of your expenses paid for) teaching English as a second language might be a good option for you. In fact, there is a need for foreign language teaching around the globe, so even if your first language isn’t English there’s a good chance that there is something out there for you.

Organizations like Go Overseas help people find language teaching jobs abroad through specific programs. While some countries are more difficult than others to teach in depending on the kinds of government programs and visas they have set up on behalf of the international language teachers coming to their schools, it’s worth considering.

Consider WWOOF (World Wide Opportunities on Organic Farms)

WWOOF is an amazing organization that offers travel opportunities to individuals willing to work on an organic farm in exchange for a place to stay, or some of their expenses covered. It’s not necessarily a full-time job, but it does provide a unique opportunity to see the world from an entirely different perspective for your gap year. Additionally, WWOOF’s mindset of promoting excellent cultural and educational experiences is one that you can get behind during your gap year. What better time is there to travel and experience new things?

Tour Leader

If you’re looking to spend time in an amazing place, why not share your newfound love of your new gap-year home? Becoming a tour guide is easy, and you’ll learn so much about the place you’re staying. Some companies operate exclusively in specific countries or areas, but others are more generalized and you can search for employment based on where you want to go during your gap year. Not only will you be getting paid to travel and explore your new city, you’ll be able to share the exciting new information with people who are just as excited to be there as you are!

Consider Freelancing

Do you have a special skill or just a large amount of free time on your hands? Freelancing may be the best option for you. First of all, freelancing doesn’t tie you down to one location during your gap year. You can work from wherever you want, which frees you up to do more travelling and exploring. Additionally, freelancing comes in all shapes and sizes.

There are freelance writers, accountants, virtual assistants, social media specialists, graphic designers, and more. You set your own rates and determine your own hours, so by taking on just a few clients you can successfully keep yourself afloat while you travel during your gap year. Who knows? Maybe you’ll decide the freelancing way of life is the life for you long-term!

Work on a Cruise Ship

No, you don’t need to know how to captain the vessel to work on a cruise ship. Cruise ships are often hiring for staff, and what better way to see some amazing locations and meet interesting people? Try checking out Yacht Crew Wanted to find a cruise in your desired area and to see what positions are available. Not everything will be wonderful, and you may have to take a job cleaning up the rooms guests stay in, but you’ll be getting paid (and usually given room and board on the ship for free) to travel and see the world. What better way to spend your gap year?

These five unique jobs are all available to people looking to take a gap year, and all of them provide interesting benefits. Decide what you’re looking for in your gap year – whether that’s travel or fully immersing yourself in a different culture abroad for a full year – and narrow down your options from there. You may even find that you’re open to more temporary employment possibilities once you hone in on your interests and where you’d like to be located. Wherever you end up, and whatever job you end up doing, make sure you’re taking the time to fully enjoy yourself before diving in to your next stage of life.

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Investing time and money now – Enjoying it later

Posted by on Mar 24, 2017 in Saving Money | 0 comments

The Hardest Part in Being a Student

Many people think that one of the hardest thing in being a student is thinking of ways to save money. I agree with those who holds this position, however, I believe there is one thing harder than saving money, especially for student – Investing money and time today, in order to save in the future. Examples for that are going to college and university, Networking with your colleagues, creating a meaningful social life and buying insurance like health insurance or a home warranty.

It is not common to find students that calculate every step thinking about the future, and I am thankful this is situation. However, when taking some decisions in life, we must think of future consequences. If not, we will find ourselves wasting money instead of saving it.  Think About Saving Money

In some cases, when taking an important decision, we automatically think about the future. However, in some cases we do not, and it will make us spend more money in time in the future. Here are some example:

  1. Studying

    The perfect example for an automatic decision most people do while thinking about the future. One of the main reasons people are going to college for, except of interest, is to learn how to manage in the future. Learning a profession is basically investing time and money now in order to earn more more of them in the future. If you haven’t decided yet what you should study in college here are some tips

  2. Networking

    Sometimes we don’t have the strength to do a efficient networking with our colleagues, but this is a good example for an important skill that will help us in the future. “Friends brings friends” is a common method of recruitment nowadays. A friend’s recommendation is perhaps the best way to find the perfect job for you. Investing time in networking and even investing some money and going to conferences that you find interesting to get to know the companies and their atmosphere can be very beneficial in the future. Linkedin is wa of the best platform that can help you with networking. If you don’t have a linkedin account, you can open. Click here.

  3. InsuranceVector Household Appliances Protection isolated on white background

    Most student believe insurance is for grownups. Actually, when it is done at a young age, it costs less. Two common and very important insurances are health insurance and home warranty insurance. The first one is more known, but a home warranty coverage which contains a home appliances insurance can save you unexpected costs and hassle. ReviewHomeWarranties.com offers a list of the top rated home warranty insurance companies in AZ, TX, GA, NJ, and the rest of the US as well.

  4. Social life

    Friend are more important than work. Studies show that social life are crucial to get happiness. As you know, keeping a healthy social life is spending time with your family and friends. Sometimes it involves spending money as well when going out and even when inviting friends to your home. Without investing time and money in your social life, succeeding in life will be much harder.

Summary

It can be hard being a student but I believe you must have the comprehension and realise that in some decisions in our life we must think about the future to come. Studying, investing in networking and buying insurances like a health insurance or join a home warranty plan are only examples for action you can take to save you time and money in the future. Protect your future by thinking about it and planning it today.

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5 Unique Personal Finance Tips for Advanced Savers

Posted by on Feb 15, 2017 in Saving Money | 1 comment

Personal finance tips are a dime a dozen these days, especially for students. It’s almost too easy to learn about money, as it can be found no farther than a simple google search.  If you are an advanced saver or someone who is diligent with their finances, the first page results may seem a bit redundant.

We all know we should budget and yes, we all know we should pay our bills on time.  What’s the next level? What more is there to learn? Is there something that a student can use? See below for 5 unique tips for those who are tired of the same old advice.

The Money Saving Process

Using Credit Cards to Your Advantage

There I was eating lunch with my boss, 8 years into an accounting career and I thought I had it all figured out.  I was dealing with billion dollar companies, of course I had my own finances figured out.  There was little debt to pay off (just a car loan) and I had my emergency and retirement funds all set up.  As I normally do, I like to pick the brain of those more successful than me (and many times those who are not.  I am a big believer that you can learn anything from anyone at anytime.)  Somehow we got to talking about how he just got an extravagant hotel booked for almost no money. Like anyone else, I was intrigued.  He told me that it was all done through credit card points.  He had accumulated so many points because he was achieving them systematically.  Here was his very simple system.

  1. Pick out a credit card that offers a reward system relevant to your desires (i.e traveling)
  2. Pay for as many bills as possible with this card.  I’m talking everything (cable, utilities, gum, etc)

The points WILL accumulate.  If you are not using credit cards to your advantage, whether it be for cash back or some free movie tickets, you are leaving money on the table.  The rewards are waiting for you!

My recommendation is to look for a deal.  For instance, I recently signed up for the Bank of America Travel Rewards Card.  If you spend $1,000 in the next three months, you’ll get 20,000 bonus points.  That right there is worth a couple hundred dollars.  It was a breeze since I signed up right around the holidays, which was not an accident.  

   

Why Fintech is for Advanced Savers

Fintech is a fun new industry sparking a lot of startup investment.  All this money equals more product for us consumers.  Fintech is short for, you guessed it, financial technology.

There is money to be saved in its creation.  One example of saving money through fintech can be exemplified in your stock trading account.  While many are content paying, let’s say $7 a trade, there are alternatives such as Robinhood.  It’s an app that doesn’t charge you for making a trade.

Imagine the compound interest on the savings of these fees?  

 

Health Savings Accounts

Health Savings Accounts are rarely mentioned but they are a valuable vehicle for savings.  The It’s most valuable asset is it’s triple tax benefit and students benefit

  • First, it’s deductible on your individual tax return.  If deposited through a payroll deduction (your paycheck), the money will be put in pre-tax.  
  • The second tax benefit is that the interest and dividends earned on the principle will be tax free.  
  • Third, any withdrawals that are deemed “qualified medical expenses” will be free of tax.  

 

Pre-tax or Post-tax Retirement Savings?

A common question for any financial professional is the following: “Should I make my retirement contributions pre-tax or post-tax?”

For students this question is extremely importing. Starting saving money for retirement at young age will benefit your future. Since future circumstances are hard to predict, it’s hard to give a concrete answer to that question.  My advice is to do both!  For instance, my employer gives me the option.  I contribute 6%, 3% to a ROTH 401K and 3% to a 401K.  It’s my best solution to get the best of both worlds.

 

Save on Money Transfers

Transferwise is one alternative that you may want to consider.  As Nerdwallet reports:

“Banks and other providers generally profit off transfers by marking up the exchange rates they give consumers, but TransferWise makes a point to avoid this. It charges a small percentage of the transfer amount as its fee. Delivery can take several business days”

Technology is evolving and making it easier AND cheaper to do things financially.  I’ll leave you with something a wise man once told me – never pay full price!

Bitcoin is a cryptocurrency that has also made waves in the international payment space but that is a story for another post.

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How to Travel Abroad for Cheap as a Student

Posted by on May 16, 2016 in Getting Started | 0 comments

asdasdOne of the biggest myths pertaining to travel is that it has to be expensive. The key to traveling on a budget as a student is to know what to spend your money on and what you should be not spending your money on. If you master this, you will be able to see double the locations in your travels. Here are my tips for how to travel abroad as a low-budget student:

  • The Hostel vs. the Hostal: For those going to the Spanish and Portuguese speaking world and do not necessarily want a low budget hostel, consider a hostal. Many non-Spanish speakers do not realize that a hostel and a hostal are not the same thing. A hostal in Spanish refers to a family owned bed and breakfast that is safe and economically. Additionally, these will give you more interaction with the locals. For example, in Madrid, one can get a Hostal for 25 Euros per night with a private room and bath that is one block from the Plaza Mayor. This is a hidden way to have the low-budget travel experience without having to stay in a room with six bunk beds.

 

  • Consider the Budget Airlines: If you are going to Europe or Southeast Asia, do not be afraid to go on the budget airlines. The key to be careful is with your luggage. Ideally, only bring a backpack and then you will not have to pay to check your luggage. Also, always print a physical copy of your boarding pass in order to avoid the fee by the airline. If you use these sometimes you can get a $1 ticket from Marseille to London or a $200 flight from Kuala Lumpur to Paris. Yes, these deals do exist and with a little creativity and intelligence, you will surely find them.

 

  • Hop-On-Hop Off Bus: These busses are in most cities that range from Europe to African cities. Where they are beneficial to a young traveler on a budget is that they eliminate transportation costs during the day that can save a great deal of money. For example, in Berlin or Cape Town, the sites are very spread out. What is best is to buy the unlimited one day or two-day pass for a set price and use the bus to get to the main sights. Usually, the bus will be positioned to hit the major points of the city and will allow you to get the lay of the land before going off on your own.

 

  • Look For the Menu of the Day: In many European countries they have lunch specials that include an appetizer, entrée, dessert, and a soda or glass of wine. Usually, you can find these specials for 10 EUR. This allows you to eat better, try the local food, and even wine taste in the process. Thus, avoid the fast food and get out there and eat good food for an affordable price.

What is important to remember as a student is that there is a cheap way to travel that is very different from traveling with your family. If you use this to your advantage, then you will absolutely be able to see a great deal of the world at a young age and add a great deal of depth to your life experiences.

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