Money is not difficult to understand. Seriously. I'm not kidding. Have you ever wondered what people mean when they say "What is your net worth?" Maybe you have always wondered how interest works. Perhaps you feel your eyes glaze over when someone starts talking about retirement. The answers to these questions are simpler than you realize. Money in general, actually, is mostly common sense. You have probably already heard everything … Read More... about The Financial Manual
THE FINANCIAL MANUAL
Budgeting is a tool you use to further establish the starting line for your financial goals. Your bank accounts establish the foundation of your portfolio. Your net worth illustrates the current state of your portfolio. Budgeting predicts the future of your net worth, and therefore the health of your portfolio, by calculating your cash flow. Utilizing these three components allows you to control the direction of your financial future. … Read More... about How to Budget for Beginners: It’s Easy as Pie
Accounts are where money is kept and managed. You could stash all your money under your mattress, but then you could face major risk due to inflation. On the other hand, investing all your money can expose you to other risks, such as economic crashes and market variability. There are several kinds of accounts, each with their own functions and uses. In fact, as a beginner, it can become confusing deciding which ones you need. If you are a … Read More... about 5 Accounts You Need Right Now
TRIGGERED I dislike the word "triggered." This slang term oversimplifies the complicated feelings that lead to important conversations. Conversations that lead to social progress and personal maturity. And worse, "triggered" has become a derogatory term. When someone says you were triggered, you have let your feelings show too much. This shaming of people who express their heartfelt opinions on a topic is dangerous. Not being allowed to … Read More... about The Phenomenon of the “Nice Guy”
Are you aware of how many accounts you have? Do you know how much is in each account? Do you know how much you spend on a monthly basis? How much do you earn on a monthly basis? Hive Challenges are intended to help you take the baby steps you need to start becoming financially literate. Perhaps one of your 2018 New Years resolutions is to be more financially responsible. These challenges will help you organize your finances in an … Read More... about Hive Challenge: January 2018
Interest is either your best friend or your worst enemy. It can work for you as an asset, or against you as a liability. But how does it work? In this post, we will discuss the basics of interest rates. WHAT YOU NEED TO KNOW A person borrowing money is a debtor. The person lending money is a lender. When a debtor takes a loan from the lender, the lender expects to be paid back. If the debtor cannot pay the loan back immediately, the … Read More... about What Is Interest?
This is a multi-part post series called My Story, where I talk about how I got to where I am today through the lens of finances. Make sure you get the full story by starting from the beginning. Last time, I talked about how I calculated my net worth for the first time in The Great Audit. And I was not happy to figure out I had a -$82,006.23 net worth. In this installment of the My Story series, I will go through the steps I took to get to … Read More... about My Story: How I Went from -$82,006.23 to Positive Net Worth in 21 Months
This is a multi-part post series called My Story, where I talk about how I got to where I am today through the lens of finances. Make sure you start from the beginning to get the full story. Sometimes, there comes a moment when you realize your true financial situation. A financial awakening so to speak. For most people, it's that moment when you think, "Wow. What happened?" The Great Audit was mine. FIGURING OUT HOW TO PAY FOR … Read More... about My Story: The Great Audit
This is Part 2 of a multi-part post series called My Story. This series is about how I got to where I am today through the lens of finances. In this post, I will be telling the story of why I chose to attend an expensive private college. To start from the beginning of this series, please click here. HIGH SCHOOL AS COLLEGE PREP The first year of my high school curriculum consisted of courses I had to take. My days consisted of algebra, … Read More... about My Story: Why I Decided to Go to an Expensive Private College
The My Story series is about how I got to where I am today through the lens of finances. In this first post of the series, I will explain the importance of establishing financial habits and focusing on education. THE BEAUTY OF CHILDHOOD IGNORANCE The beauty of being a kid is you are ignorant to all societal concepts. I never knew my familial situation was considered odd by traditional standards until I started attending school. I am the … Read More... about My Story: Establishing Early Habits & School as a First Job
A NOTE ON ANONYMITY I fully intended for this blog to be anonymous. I felt anonymity would give this blog a more authoritative, professional business presence, especially since I planned to discuss finances. However, this blog is first and foremost for me. As the blog is a creative endeavor before a business venture, I also want to use it as my travel journal. I have always wanted to record my travels, but I had never found a good format … Read More... about My Travel Journal
A portfolio consists of assets and liabilities, and the value of your portfolio is your net worth. WHAT IS IT? Net worth is simply your total assets minus your total liabilities. The calculation is simple, but the challenge is figuring out the location, type, and amount of all the components in your portfolio. In the post on liabilities, we discussed how the various categories of assets and liabilities overlap. We came up with the ven … Read More... about What Is Your Net Worth?
Liabilities are the opposite of assets. They are things that are negative to your portfolio. So what is something that is not good for your portfolio? In a word: debt. Liabilities are money you owe, things with interest rates working against you, and things that require money to be functional. Money you owe is a liability because it is a known sum of your assets that belongs to another entity (which can be a person or business). Money … Read More... about What Are Liabilities?
The first step in understanding money is understanding what assets are. Assets are the things you own that are positive to your portfolio. So what does this mean? Basically, an asset is something that is valuable in itself. Cash has value. You can trade it directly for other goods. Cash is also special in that it is a liquid asset. You can access the value immediately. Clothes, furniture, and home decor also have value. However, … Read More... about What Are Assets?