Investing Options for Newbies

Investing used to be a privilege reserved for the Wall Street crowd and the few others who already had enough money and were able to afford hiring a stock broker. The digital revolution of the last 20 years and some changes in laws and regulations have opened this coveted field to people of all walks of life who are interested in creating passive income and increasing their financial net worth beyond a paycheck. Nevertheless, investing is still a very risky undertaking and if not done carefully, it could very well result in a terrible financial situation.

If you have been thinking about getting in on the action but unsure where to start, keep reading – we have compiled a list of a few investment options that are well suited for newbies in the field.

Certificates of Deposit – Play it Safe

CDs (Certificates of Deposit) have been around forever, and to this day remain as one of the safest investment options. Most banks and credit unions offer CDs with various terms and APYs. As a general rule of thumb, the longer the term is, the higher interest rate it offers. Keep in mind that there are penalties for early withdrawals so only choose a term you feel comfortable with not having access to this money. The APYs offered vary widely from one financial institution to the next, so take the time to shop around for the best rates. In our experience, local credit unions offer much better rates than large national banks.

Wealthfront – Get Started With Automated Investing

Wealthfront is where I do all of my taxable investing. I invest in index funds anyway, where fees are very low, but Wealthfront has the added bonus of Tax-Loss Harvesting, which takes advantages of market volatility to help reduce your tax bill, leaving you more money to invest. And right now, you can get $5,000 managed for free!

There are many other robo-advisors to choose from, including Betterment, which has offerings similar to Wealthfront. It doesn’t matter which service you choose, as long as you do something productive with your money!

Robinhood – Commission-Free Stock Trading

Robinhood will make you feel like a real stock broker – with this app you can invest in actual stocks, in addition to cryptocurrencies, ETFs and options, all commission-free. That’s right, Robinhood offers free stock trading! The standard $10 per trade fee charged by most other brokerages is no longer a deterrent to the new investor who may be wanting to buy just a few shares while learning the ropes.

Fundrise – Invest in Real Estate

Fundrise is a platform that allows you to invest in real estate. The company manages a diversified portfolio of real estate properties, and your investment is spread amongst dozens of assets, thus minimizing the investment risk and optimizing your investment returns. The current minimum to invest is $500, and even though this may sound like a significant amount compared to some of the options we discussed earlier, keep in mind that real estate is expensive and without platforms like Fundrise most of us would never have the capital to invest in real estate independently.

Rule of Thumb – Diversify Your Investments

Whatever options you may choose to get started, do not forget the cardinal rule of investing – diversify, diversify, diversify. Split your investment money between several options you feel comfortable with and continue educating yourself on each in order to ensure your long- term success as an investor.

Saving Intentionally: Why (and How) to Have More than 1 Savings Account

A 2017 GOBankingRates survey broke some alarming news: over half of Americans have less than $1000 in a savings account, and almost half of the people who fall in this category don’t have anything in a savings account at all. With almost 7 out of every 10 Americans having somewhere between absolutely nothing and just $1,000 in savings, there’s reason to be concerned about the ability of many Americans to pay for emergencies.

If you’re one of these Americans who doesn’t have a savings account, it’s time to start one. I’m sure you’re fully aware that emergencies come up, and emergencies often come with a hefty price tag. I totally sympathize with the assumed reaction here, which is that you just don’t have extra money to save. However, if you don’t think you have money to stick in savings now, you certainly won’t have the (much larger sum of) money to cover an unexpected expense.

Getting Started with Savings

Starting to save doesn’t require hundreds of dollars, especially if committing to save is going to require some serious budgeting shifting for your family. Even starting with just $20 and adding $5 a week is a great way to start forming healthy saving habits.

Looking for small things to cut out of your budget and redirect those funds to savings is a favor to your future self. I promise that while cancelling Netflix or choosing to eat meatless meals 2 times a week to cut back on the grocery budget might feel like a huge sacrifice in the moment, the sacrifice will seem much smaller when you’re better prepared financially for an emergency.

Many people who save have one checking account and one savings account. The checking account is used for daily expenses, and the savings account is where they stick money back for anything that might come up – an emergency, a vacation, a medical bill, or a down payment on a new house to name a few uses.

Savings accounts can be opened at your local bank or credit union, or through an online bank. It’s worth looking into an online bank for savings as they often have much lower overhead and are able to offer significantly higher interest rates than traditional financial institutions.

If you don’t think you have much money to save, there are lots of savings challenges to help you find a little money to save here and there. Challenges range from saving $1 each week to match what number of the year that week is (first week of the year = save $1, last week of the year = save $52) to saving 1 cent for what day of the year it is (January 1st = save 1 cent, December 31st = save $3.65), among others. You can do this with actual currency, or set up auto transfers from your checking account to savings.

Multiple Savings Accounts

While saving money is always a great practice, saving all your money in one account can be problematic. Let’s say you spend your entire savings account taking a beach vacation. You get home and find that your car won’t start in the airport parking lot. You have to pay to get it towed, and you later get a $500 bill from the mechanic for a new starter. You just spent all your savings on margaritas on the beach, how are you going to pay for this?

Having multiple savings accounts, each designated for something different, can help you avoid situations like this. Different savings accounts might include an emergency account, a travel account, a Christmas account, a vehicle account, or a home improvement account.

When you have multiple savings accounts with specific designations, you won’t spend everything you’ve saved on one expense. Of course there will be times than an emergency or an opportunity costs more than what the most closely designated account can cover, so it’s nice to have other funds to pull from in these instances.

Splitting what you can save into multiple accounts may mean it takes longer to reach your savings goals. However, it’s worth it to be able to treat yourself or cover an expense without it affecting your other savings goals.

How Workers Compensation Protects Your Business From Financial Distress

Workers compensation insurance provides cash or medical benefits to employees who are injured on the job. While you are just starting a business, you probably do not have to worry about paying for this insurance. Unless, you would like to cover yourself as an employee. However, once you start hiring other people as employees, it will be increasingly necessary to have a workers’ compensation policy in place. While some states do not require workers comp, most have mandatory laws in place. As the business owner, you are responsible for ensuring that the company pays for this insurance which can offer protection in the event of an incident. To learn more about how workers compensation protects your business, keep reading below.

Employee Accidents Or Injury

If an employee experiences an accident at work, workers compensation can help cover the medical costs associated with the accident. The policy will also cover the lost wages that employee incurs as a result of the accident or injury. For example, if an employee were unable to work for a month, the policy could cover the wages over that period of time. Securing a policy, you can protect your business from having to pay out these wages. An accident or injury can be an expensive event that workers’ compensation can protect you from.

Injury Lawsuits Against Your Business

Secondly, workers’ compensation can protect your business from injury lawsuits. The cost of an injury lawsuit could bankrupt many small businesses. However, workers’ comp comes with another part of insurance called employer’s liability insurance. This part of the policy would cover attorney’s fees, court fees and judgements settled against your business. Of course, each policy has a limit of damages according to your business’s coverage. However, the policy limits are usually set high enough to offer significant protection to the business’s overall financial stability.

Job-Related Illnesses And Long Term Injuries

Furthermore, wordpress compensation can protect your business from long term costs associated with permanent injuries and illnesses. If there are long term diseases developed at work, workers comp can cover these costs too. Medical treatments for diseases like carpal tunnel syndrome or chronic back pain may take many years to heal, if at all. Obviously, a long term cost like this could drain your company’s cash flow. However, the insurance policy would protect the company from this type of long term risk and liability.

Support Managing Claims From Employees

In addition to providing financial protection, a workers’ compensation policy can assist in dealing with claims from employees. According to Daniel Noll, a lawyer in Springfield IL, “most work-related injuries must be reported to an employer within 45 days.” Dealing with these claims could cost your business valuable time and resources for administrative tasks. With the help of your insurance carrier, they can take care of the claims process for you. This way, you can spend more of your valuable time running the business while your insurance provider responds to employee workers’ compensation claims. Needless to say, the policy could protect your business from losing valuable resources to keep the business running.

Trust Between The Company And Employees

A workers’ compensation policy establishes a level of trust between your business and employees. They will know that if there is an incident at work, they can claim compensation. Within reason, they will not have to worry about covering the medical bills or lost wages if they are injured at work. When your business is trusted by employees, it improves retention and overall productivity. This is essential to the financial success of a company. The security offered to employees with workers compensation can offer your business protection from low morale or high turnover rates.

Workers’ compensation covers many types of injuries and illness while protecting your business from absorbing the total cost of these events. If an employee is injured or hurt at work, the policy will cover the costs for medical bills or lost wages. It can also cover the costs for long term illnesses and injuries that an employee may suffer. On top of that, if an employee tries to use your company, the insurance policy would cover the legal costs associated with a settlement or judgement. It will also assist your business in managing claims when injuries are reported. More so, the policy will promote trust between employees and the company. These are all important ways that workers’ compensation can protect your business from financial hardship.

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