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How to Improve Your Finances in 7 Easy Steps

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How to Improve Your Finances in 7 Easy Steps

Most people are constantly trying to figure out how to find a way to get their financial picture to look when the money coming in does not balance the money going out. Individuals and families want to have enough money to pay their bills, save for their future, and, and have plenty on hand for leisure and fun. But sadly, many people are just robbing one account to pay another account in order to keep managing expenses from month to month.

Most people spend most of their time worrying about money or the lack of it, rather than in those leisure activities that a surplus of money can buy. There are some ways to help gain some of this financial freedom with a little patience and some hard work. It’s fun to spend money, but with some restraint up front the payoff in the long run, a person can get a handle on debt, savings, and spending money.

If the debt situation is severe, a consumer credit counselor may be the route to go to get some outside help. Make sure you go with a reputable service that is a nonprofit organization and an NFCC member. But if you are able to manage this situation and can get on top of your finances, these seven suggestions will get you on your way:

1. Spend Less Than You Earn

It’s tempting to buy the house and car you can afford, but do not. You do not have to keep up with any one. March to your own drummer and keep the house payment low and the car payment even lower. It is a fact, your car will depreciate the minute you drive it off of the lot, so be sure to shop wisely when buying a car. You don’t have to buy brand new to buy a good car in excellent condition. The key is to search for a car with low mileage that someone else owned for a year or two.

2. Create an Emergency Fund

This is one of the hardest things for most people to do. “Almost every time a sizable amount, such as even $200 or $300 gets in a savings account, there seems to be an emergency that I need money for,” one person lamented. This is not a solitary statement. For people who are stretching money from paycheck to paycheck, saving money is difficult. Even still, this emergency fund is critical. The money in the bank account will stop unnecessary credit card charges, pay day loans, and other spending that is only going to cause a person or family to fall further behind on improving personal finances.

3. Start Today

Open an online savings account or attach a savings account to your checking account at your bank. You could also try Stash for easy online investment. Whatever you do, start saving today…right now.

4. Pay off Debt

There are two strategies to approach debt payoff. One is to pay off high interest debt first. This is a wise strategy because higher interest debt is very difficult to pay off. And the larger the interest, the harder it is to pay down or off. Another school of thought is to pay off the smallest debt first and then roll the payment into the next highest and so forth. Paying off a low debt may help to give you a mental boost and then to encourage you to keep going and pay off more debt in the future. Which strategy you choose, be mindful in paying down debt. The road to financial freedom is having no debt.

5. Diversify Income

Try to earn more to save or to pay down debt. Sell anything you don’t use or love. Now is the time to downsize as well as earn money. The less you have the less space you need. In the long run, that can help you save even more funds. If you have a talent, or special craft, open an Etsy shop. Earn money with freelance photos, writing, dog walking, dog sitting, babysitting, baking, grocery shopping, and more. The ideas are endless.

6. Income Does Not Determine Wealth

A very wise factory worker once said to my mom, “The more money you make, the more you spend.” Think about that for just a minute. This philosophy tends to be the way we do things in our society and is also why many people have debt that equals exactly what they make. This mentality needs to shift to an accumulation of wealth regardless of what we make. Think about saving first and spending later. Make a budget with saving at the top before any money is spent for anything else.

7. You Must Design a Budget

Write your expenses and income down on a spreadsheet and account for everything. Make sure there is money for savings. If you are making extra money, allocate that money for debt. If all debts are paid off, put that money into a designated savings account.

The Road to Wealth

People who plan for the future by making a budget usually are the ones who are not surprised by financial setbacks. They save first for an emergency fund and then save for long term goals. If you have an emergency fund, it’s time to then tackle debt. Once debt is gone, then true financial freedom can be achieved, and you can experience a level of wealth this freedom allows for more fun and time with friends and family.

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Varney: Dems Bending Over Backwards To Help The Wealthy, Not Working Class

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Varney: Dems Bending Over Backwards To Help The Wealthy, Not Working Class

If you think the Democrats care about the working man, think again, says Fox Business host Stuart Varney.

He says the Democratic elite are bending over backwards to try and help their wealthy donors at the expense of the working class.

Just look at the breakdown in the negotiations for a new stimulus bill. The Democrats aren’t clamoring for another round of $1200 stimulus checks, they’ve let that fall to the side. Who benefits from another $1200 check? The working class, of course. The wealthy sure don’t need it.

The sticking point, says Varney, is a tax deduction. Specifically the SALT deduction that allows state tax payments to be deducted from federal taxes. President Trump put in a $10,000 cap on the deduction as part of his Tax Cut and Jobs Act. That’s not an issue for ordinary working class Americans, but does affect wealthy individuals in high-tax states, many of which are Democrat states likes New York, New Jersey, California and Illinois.

Varney says the Democrats clinging to this tax deduction for the wealthy at the expense of the working class tells you everything you need to know about their priorities.

“The Democrats are moving heaven and earth to help the rich. You heard right. The Democrats are running to the assistance of the top 1%. This tells you a lot about political change. If you thought the Democrats were all about working people, think again.”

He says the far left may want to tax the rich, but the Democrat establishment is looking to protect them.

“Maybe the socialist wing wants to seize your wealth, but the establishment is desperate to bail out their wealthy supporters. Specifically, they want to bring back the deduction for state taxes. Yes, that’s the SALT issue. It’s the big sticking point in the fight over the new virus package.”

He says for wealthy Americans living in Democrat states, it was a “major league” deduction. Without it, they are paying higher federal taxes.

“It was a major league deduction. It was a big tax saving. But that’s the old days. Now, no tax deduction. And the wealth, especially in high-tax Democrat states, are complaining bitterly. They’re paying more Federal tax, not less.”

Establishment Democrats are scrambling to get SALT repealed, says Varney, showing their true colors to their constituents.

“Oh, there is desperation. New York Senator Chuck Schumer, he is demanding a SALT repeal. So is Speaker Pelosi. She’s from California. So is candidate Joe Biden. The establishment is desperate to avoid even higher taxes in already high tax Democrat states which would make things even worse.”

“If SALT were to be repealed, the establishment helps its rich donors. It will be a Democrat gift to the wealthy. The main beneficiaries will be one-percenters. Forget ideology. Political self interest is what rules the Democrat elites.”

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Ron Paul: This Is The Biggest Financial Bubble In History

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Ron Paul: This Is The Biggest Financial Bubble In History

Dr. Ron Paul believes that we are in the biggest financial bubble in history. He also said that when it pops, it will be very violent.

In a recent interview with Kitco News, Paul covered a wide range of topics. Some of these topics include the Federal Reserve, interest rates, and the economy.

He was asked about the Federal Reserve’s dual mandate of full employment and inflation control. To this, Paul said the Fed shouldn’t even be in the business of worrying about either.

“They shouldn’t even be in the business of pretending that if they want a good, healthy economy, and they want as best the employment possible, and the most balanced pricing system, you have to get rid of the system. You can’t have this artificial system from the Federal Reserve,” he said.

Free Market Should Set Interest Rates

Paul said the free market should be the one setting interest rates. Additionally, when the Fed thinks it has control over things is when problems start.

“You have to have a market rate of interest, and you have to have a money supply that’s determined by the market rather than by the politicians, because we are seeing the results of many, many years of this, especially since 1971 with what is happening now, it’s the runaway spending, we can’t have the runaway spending, if we continue to do this, and the fact that they pretend that they can control things, every time they think they have control then there’s a major correction, which we are in the midst of.”

He said the big event was when the Fed realized last fall that the bubble was starting to pop. He also mentioned that it began doing everything it could to keep it going. This meant cutting rates to zero.

“The big event that turned this whole thing on was in the fall when it was realized that the financial bubble was collapsing and they have destroyed for many, many years the most important function of the market, in the money supply are the interest rates. So we destroyed the pricing structure and that’s why we have so many mistakes, malinvestment, too much debt, too much government, and it wouldn’t happen if you didn’t have a Federal Reserve system that thinks they can manage the economy through monetary manipulation.”

Gold and the Market

Paul said the Fed can print as much money as it wants, but ultimately gold is what underpins the markets.

“I remember when gold was legalized in the 70’s, everybody thought the gold price would soar up, but it had already gone up, but at the time, our Treasury Department and the IMF (International Monetary Fund) dumped a lot of gold just to try and punish the people who knew that gold was a haven. So there’s a lot of monetary and gold manipulations, but ultimately the markets are determined by metals, not by paper money.”

He said we are getting close to a “cataclysmic” end to the bubble. The unfortunate result is that a lot of people will be wiped out financially.

“We are coming desperately close to a cataclysmic end to the current monetary system. I happen to believe it’s the biggest financial bubble in the history of monetary policy for the whole world. And the correction is going to be very violent, and it’s already pretty bad. People are going to get a lot poorer.”

“The bills have to be paid, the economy is going to turn down, and a lot of people have already gotten a lot poorer, but it’s going to get a lot worse unless we wake up and return to some sound economic and monetary policies.”

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Wall Street Veteran: This Is The Biggest Stock Market Bubble In History

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Wall Street Veteran: This Is The Biggest Stock Market Bubble In History

We are in the midst of the biggest stock market bubble in market history, according to Andrew Parlin, the founder and CIO of investment advisory firm Washington Peak.

In a recent op-ed for the Financial Times, Parlin says he’s experiencing “déjà vu” as he outlines the parallels between the Japanese real estate bubble of the 1980’s and today’s tech-driven bubble.

As a young investor during the real estate craze in Japan, he met with an analyst who claimed the stocks of a midsized and heavily indebted railroad company should be worth 5 times to 10 times more, because they could convert some of their land holdings into a giant condominium complex.

“Never mind that the land was desolate and inaccessible. Nor that acquiring the necessary permit would take years. He produced elaborate financial models showing how the stock was actually worth five to 10 times its current value. My head spun,” said Parlin.

“Back then, anything with a whiff of exposure to real estate was at the centre of speculation. Now, the hottest sectors in America are nearly all disruptive technologies. Stocks with real, or perceived, exposure to the cloud, digital payments, electric vehicles, plant-based food, or anything at all to do with the stay-at-home economy have shot up meteorically.”

Unrealistic Value

But Parlin says the value of many of these “disruptors” is as unrealistic as what he saw during the Japanese real estate bubble.

“Bubbles are formed around individual stocks and sectors. As the concentric circles of excess widen, more and more stocks are infected. Wildly exaggerated stock stories force a delinking between fundamental analysis and share prices.”

He points to Tesla as an example of this phenomenon.

“That is how a stock such as Tesla commands a market capitalisation of about $400bn, up from $80bn in March, and $40bn one year ago. Tesla’s rise then engulfs the entire electric vehicle market in a frenzy of speculation.”

Companies Approaching the Market Bubble

Parlin’s reliable metric for a market bubble is the price-to-sales ratio. He says the number of companies with sky-high price-to-sales ratios is approaching dot-com bubble territory.

“Today, according to Bloomberg data, 530 out of America’s 8,513 listed common stocks trade at more than 10 times sales. This is 6.2 percent of all common stocks… Only at the very top of the dotcom bubble, in March of 2000, can we find a larger percentage of stocks (6.6 percent) trading in excess of 10 times sales.”

“The point is that price-to-sales ratios in the stratosphere do not stay there, any more than a tulip bulb in 17th-century Holland was able to maintain a price of $100,000. This gets at the troubling thing about bubbles. They do not simply undergo smooth and endogenous shrinkage until they disappear. Instead, they continue to expand until they burst. This is why their bursting is more often than not shocking, spectacular and disorderly.”

He says he doesn’t know when the bubble will burst, but we are all a part of the biggest bubble in history.

“When and how this ends is impossible to say. But with the Fed pursuing thunderous asset purchases and getting ever softer on its 2 percent inflation target, the bubble is firmly on track to be one of biggest in stock market history.”

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