Money makes the world go round...

This blog can help you about the right management of your finances, tips on staying how to stay away from debt, and so many more.

Money makes the world go round…

This is an old saying that people believe and so people have jobs to suffice their daily needs and wants. However, people just keep on spending money and sometimes it is spent on what it is not intended for. Good thing that there are people who are financially educated, especially in personal finance management. They want to share their thoughts on things and they want to educate and inform others as well.

This blog can help you with the right management of your finances, tips on staying how to stay away from debt, and so many more.

What We Do

Personal finance is an important thing that every person should know; however, it is one of the ones that is usually neglected. Some people have not found its importance because they do not know its importance.

This blog aims to help those people who do not know how to manage their personal finances. They will be reading about tips on how to budget, how to save, and even how to stay out of debt.

The author of this blog is a financial adviser who was also lost to spending too much on clothes and shoes. This time, she is willing to share what she has learned and she is willing to guide people to the right financial path.

Latest Articles

7 Tricks for Making the Best Budget

Financial caution, budget development, monetary balancing, savings growth and more. These terms sound scary, don’t they? Making a budget, especially if it is for the first time, can appear to be an extremely daunting and challenging task.

The truth is that it sounds more terrifying than it actually is. The best way to handle this so-called stressful task is to firstly realize that it is not that at all! Simplify it by comprehending what the essence of a budget is. Primarily, it is a written down plan of your funds and how it will be managed.

You are the one in control, the one making decisions and the one to make any final calls on its allocation. Hence, there is nothing to be scared off! Isn’t that great? Now to make you feel at ease even more, let us share with you 8 wonderful tricks that will help you in designing your budget.

  1. Make Your Favorite Tea

You must be wondering why the numero uno tip is to make a cup of your favorite tea. The reason is that the most important stage in crafting your budget is to make sure that you are in the right frame of mind. Being calm and mentally at peace is strategic in creating a realistic and an efficient economic strategy.

So, put the kettle on and boil some water. Take out that colourful mug that your niece or grandma gave you and pour some tea in it. We recommend chamomile or green tea as it helps you to relax and perhaps smile a bit even. Switch on some soothing music to help you concentrate and gather your supplies. Take out some vibrant highlighters or pencils along with a pad of paper. Or if you are tech-savvy and prefer a more automated way, then feel free to tap into the magic of Excel or any other spreadsheet program.

  1. Soul-Searching Time

Now that the ambiance has been set, reach into the deepest corners of your soul and think. Think why you are making this budget and figure out what your source of motivation is. What is it that drives you to be undertaking this action? Getting to the root cause will help you stick to your budget in the long term. Are the indigo waters of the Mediterranean Sea calling out your name in Santorini, Greece? Is it desire in owning a new home? Or building a pool of funds to pay for that Ferrari once you retire? Or are you trying to become debt free?

Identify and establish both long term and short term goals. This way, you will be motivated to set a small sum aside accordingly. Short term goals can include saving up for a new car, a vacation or a down payment on a property. Long term goals would include retirement, college funds for your children or capital to launch a new business. To achieve these objectives, you may have to compromise on certain activities such as not watch the latest Marvel superhero movie on Imax or try out that new Italian restaurant that all your friends are recommending. Knowing what you are striving to accomplish will make you feel stronger and more dedicated in your journey.

  1. Take Away Income

One of the most common mistakes that people make in budget planning is to not take into account what their after tax income is. It is imperative to fabricate a budget based on the disposable income that you actually come home with. Take your after tax, annual income and divide it into twelve parts to understand the number you receive at the end of every working month. This is the benchmark against which you will design your budget around.

  1. Truthful Patterns

Be honest with yourself when you are tracking your expenses and figuring out how much you spend on different categories: food, recreational activities, rent, insurance, transport etc. Take out receipts from the past couple of months or review your banking transactions to identify your spending patterns. This is a crucial step in understanding the volume of outflows and corresponding inflows. By doing this, you will be able to comprehend which areas you can reduce spending in order to save or to simply attain your desired budget outcome. This should also reflect infrequent expenses that may occur on a seasonal or quarterly basis. These can vary and include property taxes, vehicle insurance or homeowners’ insurance.

  1. Debt Freedom

It would be a perfect, utopian realm if we were able to exist without any format of debt in this day and age. Unfortunately, we all built up a little debt over the years. However, the secret is to balance it out and ensure it is not going out of control. Contact your bank and set up an automatic debit transfer of a certain amount to pay off whatever entity you owe. Whether it is a credit card or a personal loan, returning a specific amount every month will eventually win you your freedom.

  1. Separation of Accounts

If you find monitoring your financials complex if it is present only in one account, then open up others with specific purposes. Tap into a savings account and deposit your intended amount in. This way you will know not to touch that money until you attain your fiscal goal. A checking account will help you track your fixed outflows. Either utilize the same checking amount for your daily spending money or open another. Depending on your level of comfort and confidence, you can manage your accounts accordingly.

  1. Realistic Expectations

Ever gone on an extreme, fad diet with the hopes to lose 15 kg in less than a month? It must have involved you going to hardcore lengths and cutting back calories. It may work for you for the first couple of weeks, but then you will find it hard to stick to it. Losing weight is easy, maintaining is the challenge as you have to live by healthier choices. The same principle applies to budgeting.

Don’t cut back on recreational spending 75% suddenly. Take it slow and ease yourself and your partner into it. Measure what amount of your money goes into entertainment (with a time base of 2-3 months) and promise yourself that you will bring it down by ten percent or so. This way, you still save more and get to enjoy your life as well. It will gradually build your courage and enable you to stick to your budget.

10 Awesome Ways To Save Money

Is the aroma of beef steak lingering in the air and enticing you as you walk by your favourite restaurant? Is that black, sultry dress calling out your name as you stroll by a clothing chain that you love? Or is that sparkly new diamond necklace looking extra shiny in the jeweller’s window? If the answer to the above questions is yes, then do not worry. We have walked in your very shoes and can relate to the temptation that you are attempting to avoid.

After all, it takes a lot of willpower to just keep on walking and ignore the call of the consumeristic devil. Not everyone will have the same level of strength and be able to resist it. That is why we are here to guide you and offer a few tips that we have gathered over the passage of time.

  1. Record Your Expenditures

If you are not sure what your monthly budget should be-start out by recording all your transactions. Once you have gained an insight into the number of fiscal inflows and outflows that your lifestyle requires, you can take a step back and start reviewing what can be reduced. Not only this, it will serve as a clear snapshot of your spending cycle and demonstrate in a glance where the major amount of your expenses is going. Be it a coffee, a snack, a bottle of water or even a pack of chewing gum-note it down in your diary. This should allow you to count every penny that is being spent. To get a broader picture, classify your data by items such as mortgage, recreational activities, medical or groceries.

  1. Make a Weekly Menu

We all love to eat out and relish the exquisite taste of that burger at the joint by our office. Its just a few extra dollars, so shouldn’t really matter. Guess what, every penny counts. Those twenty-dollar burgers once a week could potentially save you a thousand dollars annually. Just do the math! Mind-boggling, isn’t it?

Dedicate a few hours every week to design your weekly menu-food that you will cook yourself at home. Then, go grocery shopping over the weekend and spend a couple of hours prepping meals for the week. Knowing you have food waiting at home will encourage you to eat that only. Dining out is usually the biggest chunk of financial expenses in a household. So not only will you manage to save money, but calories as well as it is a much healthier alternative.

  1. Plan A Budget

This can stem from your recorded transactions as you will have a picture of what your expenses entail. Decide what percentage of your regular income you would like to save. Try to keep it a realistic figure so you do not get demotivated or disheartened if the numbers do not match up at the end of the month. Make sure you account for seasonal costs that do not occur on a frequent basis, for example, car servicing. When you plan for such charges            in advance, it helps you to organize your other outlays in an efficient manner.

  1. Save for That Big Holiday

Setting short term goals is an extremely effectual method to roll in the dough. It can be anything that your heart desire and can range from a summer holiday to a down payment for your first home. Estimate the length of time you will require to build up a pool of funds large enough to achieve your objective.

  1. Automate Your Savings

We live in a world where we are at the prime of technology. As a society, we are experiencing continuous innovation where advances in communication are made daily. Utilize this and enjoy the benefit of having your bank transfer a certain amount of money monthly and transfer it to your savings account. Most financial establishments offer this facility and you can avail it. Direct money transfer serves as a means to spend less overall and teaches you to live in the amount allocated.

  1. Track Your Growth

It helps if you are monitoring your savings account and ascertaining whether you are closer to reaching your target. Do this every month to observe the status of your progress and make any adjustments if required.

  1. Pick Your Priority

It is quite encouraging when you begin to see your saving pool grow. Do not forget your long term goals whilst striving to achieve your short term ones. It is imperative to remember that retirement is a reality that you should try to prepare for. Starting at a younger age will allow you to spread your numbers at a lower rate.

  1. Put it in the Bank

Received a nice, generous bonus from your company for those extra sales targets you achieved? Or is a nice birthday check coming your way from your magnanimous uncle? Do not blow it all on a beach vacation or on the latest Iphone. Reserve a reasonable chunk of it and deposit it in your savings account. Do this immediately so you are not tempted to spend it.

  1. Take Coffee From Home

As much fun as it is to go for a coffee with your colleague in the morning and then again once more after lunch, it makes a bit of a dent in the wallet over time. Imagine if you saved those $10 a day, that is $200-$300 saved a month. Start out slowly and commence your saving journey in this aspect by taking coffee from home at least 3 times a week. Feel free to invest in a few different brands and categories of coffee as it is still going to be cheaper than getting it from a coffee house.

  1. Work, Work and Work

We do believe in a strong work -life balance. However, it is true that if you work more, you will be too busy to think about spending money: be it going out for a movie or a meal.

How banks are looking at the rise of fintech and their use of blockchain technology

Why banks are testing new technologies

When new technologies were initially being developed it was with a view to create a method of keeping records that wouldn’t require a third party to oversee its regulation. By giving multiple users access to these shared digital databases via a distributed ledger and utilising up-to-date securities that would make entries and the information it held unchangeable by outside parties it created a new, transparent and labour free way to record financial transactions. As the blockchain technology gathered momentum it became the underlying system that has given rise to the world of cryptocurrency – Bitcoin and the rising range of altcoins has started a revolution in digital currencies we can choose to use over our current and limited typical fiscal currency options.

A secure and labour free system

Creating this secure and efficient method of registering transactions blockchain has become an obvious move towards how we should be organising our banking, reducing inefficient human contribution and error, making the transaction effortless, immediate and in effect cost-free. Reducing cost is what is going to make the blockchain system highly competitive in today’s financial market, so much so it could put the banks out of business if they don’t follow suit and join the revolution.

That’s why nearly all banks are investing heavily in fintech research. Blockchain obviously is the primary concern but it’s not the only tech the banks have to consider, they now have to examine every new technology that offers up real competition and to make important changes to keep in line with where the future of our finance is heading. There has been much published research by many of the global banking giants reporting their own research on blockchain technology but very few so far have constructed a blockchain based system of their own to replace current methods, despite having started to patent their own devised blockchain technologies.

It’s so much more efficient

The main advantages of the banks such as Cambr Banking implementing blockchain tech have been outlined above; it’s so efficient it will reduce the costs associated to current methods and save them huge amounts of savings. Santander has said that through their research they estimate savings of up $20billion per year by switching over to a blockchain system. It’s not only the ease of the transaction being handled by the technology instead of being processed by human operation but the amount of regulation issued by the government over the banking industry will also be handled autonomously by its own software processes.

Healthy competition – but for who?

The rise of the fintech companies who are already using blockchain systems to handle such things as international payments, savings programs, financial remittances and more, means that the banks aren’t the only players to consider now, and for the consumer that means they aren’t beheld to one set of costs but now have not just another option to choose from, but many. All of these choices are great for us, the saver and spender, but for the banks it means a much smaller slice of the pie in future – or no slice at all if they can’t cut costs and compete.

It also means that with the banks investing in new technology solutions it doesn’t just leave the door open to the fintech start-ups being the only ones to disrupt the banking industry; the banks themselves are getting into a position where they too can create new systems and business models using data solutions and artificial intelligence to organise those new advancements in their own industry that has so far been implemented by the outsiders and newcomers to the finance world.

Where next?

The blockchain tech is primarily aimed at reorganising an outdated system with a highly improved and technologically sound upgrade. But just because we can reorganise the way we monitor and transact with our current financial currencies by no means will the use of this technology end there.

With the introduction of blockchain technology the rise of cryptocurrencies has indeed been its main application, and even despite their rollercoaster rise to mainstream use they are now an established way of organising your wealth. Aside from it being a fashionable tech opportunity this new system has also been offering itself as a marketplace to trade in, giving its users an alternative way to make profit from their finances to challenge the banks steady decline of their interest rates applicable to your savings from their traditional investment methods.

Banks are going to need to continue their development if they’re going to keep up with the new fintech kids on the block, whether they work independently or join forces to pool resources and forge new ways ahead together, they simply can’t afford to get left behind.

The future for banks looks gloomy with research projecting that the new technologies could be responsible for a loss of revenue of up to 40% by 2025 for banks and between 15% and 20% of US banks could have fallen or been consolidated into the new fintech companies as soon as 2020.

However, it’s not all doom and gloom for those who are willing to keep up. Analysing the effects of fintech on the banking industry the consultancy McKinsey have forecast that progressive banks could innovate and introduce new technologies to compete that could increase revenues from new offers by 5%, revenues from new products and digital sales by 10%, and also lower their typical current costs by automated processing with digital transactions by 30%. Adding all these factors would give the bank willing to move into this new area a possible profit of over 45% that would translate into a much higher and competitive financial success rate.

It’s an important time for banks to assess and continue to re-assess their business operations – from their high street branches through to how they manage every product and service on offer. The traditional methods of banking are founded on the cornerstone of a branch their customers can attend to fulfil their needs. The fintech alternatives are very much automated online systems cutting out the need and the expense for high rents and staff costs. How the banks are to manage this change in trend is just as big a question they will have to ask themselves as how to change their technology systems.

The future for banking is changing, that there is no doubt, but who will come out on top, in charge and in profit, is something we’ll just have to wait, watch and see.

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