5 Tips to get out of debt

FullSizeRender

Getting out of debt is an amazing feeling, but trying to, especially since many of us have never been out of debt our entire adult lives, may seem almost impossible.

Below are the main tips that worked for me to get out of debt.

  1. Realize it’s a special goal. To this day, no one that I know personally (and that has shared with me) is debt free. I think it might seem unimportant, but being aware that you are doing something out of the norm might help you achieve your goal.

We’re social people and a lot of times we do not want to do anything too far from the norm. Being “normal” has its benefits. It may reduce conflict and make us feel like we’re part of something. It’s understandable that we may unconsciously self-sabotage any efforts that require us to go against the grain. Be on the look out for any self-sabotaging behavior as you’re working towards this goal.

I recommend taking some time to acknowledge you’re going to be doing something special and to realize the positives of this unique endeavor.

  1. Stop taking out new loans or credit cards. It seems obvious, but it’s all part of the process. Keep an eye out for the urge to take out a new credit card while you’re working on paying off all your debt.

 

  1. Break the debt into smaller goals. For me, it helped to focus on one loan or credit card at a time. It helped keep me motivated because it increased my confidence and energy once I paid off one debtor.

 

  1. Increase your payment amounts. This technique is more powerful than you may think. I would sometimes make $10 or $15 additions to loans of amounts exceeding $10k and it really led to me getting them paid off quicker. What seemed like insignificant amounts, snowballed to hundreds and thousands of dollars. If I had even $10 extra in my budget, I would put it towards the loan I was trying to pay off. Every time I reduced my loan by $100 I was more motivated to put more money towards paying off the debt.

 

  1. Reduce your expenses and put any additional income towards paying off your debt. This is an opportunity to scour your budget and see if there are expenses that aren’t providing much value or happiness in your life. Find those expenses, get rid of them or reduce them and redirect that amount towards paying off your debt.

 Keep your head up. Paying your debt off may take some time, but it can be done.

Posted in Saving Money | Tagged , | Leave a comment

Make $500 this weekend

IMG_7608

Palm trees greeting me as I get an early start to my $500 weekend goal

So you want to make $500 this weekend? Here’s how to do it.

  1. Start an eBay account. Go through your closet, find stuff you don’t wear or use anymore. Look for name brand items that are in good condition. Take some great photos. The photo should accurately show the item and also subliminally make the impression that you have a clean, rich household. By rich household, I mean, take the photo on a high quality table or some other fancy looking material (think clean leather, marble counter, etc.). List the items on eBay, set them at a reasonable price for an auction, and in a week you’ll have hopefully sold a few items. Sales estimate = $100
  2. Start a Poshmark account. Same as item one. Take great photos and price to sell. Brand name items in good condition seem to sell on Poshmark quicker than on eBay, but Poshmark has higher fees. I list my items on both eBay and Poshmark. Make sure you delete the listing on the site it didn’t sell on once it sells from the other site. Sales estimate = $100
  3. Look into driving for Lyft or Uber. The process for signing up and getting started is quick and easy. I’ve driven for both and the whole experience was easy to get started and there are no commitments to how often or when you need to drive. If you do sign up, consider finding a friend that already has it. Then tell them they can refer you, if they’ll give you some of the bonus they get for referring a driver. Driving for nine hours = $200
  4. Buy stuff at garage sales for cheap and resell them on eBay for more. The key to this is to find the right items. When you’re at the garage sales, look up interesting items on eBay and see how much they’re selling for. Profit estimate = $40
  5. Offer to babysit for one of your friends for an evening. Four hours = $60

Your monetary results are going to be different, but it’s reasonable to expect to get similar amounts with some effort. Try one or all of these ideas and let me know how it goes. And share with us if you have other ideas on how to make extra money on the weekend! Happy hustlin’ 🙂

Posted in Making Money | Tagged , , , | Leave a comment

Why do you want to be wealthy?

Think about it. Why do you really want to be wealthy? What is your motivation behind wanting to learn how to save more money or get better returns on investments?

Digging deep in ourselves to understand why we’re motivated to pursue the things we pursue can help create a personal manual to reference when making choices. When you make choices that align with your values then you make better progress towards your goals and ultimately towards fulfillment.

For me, I pursued wealth because I wanted to express myself with creative endeavors outside my day job. But I didn’t yet have the skills to make enough money off my creative interests. My day job was not fulfilling me so I thought if I became a great investor and created enough passive income, I could essentially buy my freedom and do what fulfilled me even if that activity didn’t pay enough to make ends meet.

Understanding my motivation helped because it made it easier to make decisions. When I paid off my debt and saved a decent amount of money, I could have then got a luxurious car and upscale apartment while continuing to work my regular job. But I knew my motivation wasn’t to have the status symbol and luxury that comes from pricey items if it meant I had to spend nine hours a day doing something that was unfulfilling. My motivation was to give value to the world that I cared about. So instead of spending my money on luxurious items, I decided to save and invest more.

IMG_1783

Maybe your motivation is different. Maybe you love your job, but your debt or lack of savings causes you anxiety and you want relief from that nagging stress weighing you down. Whatever your reason is, make sure you know it and keep it at the forefront of your mind. If you don’t understand your motivation then you risk society and marketing placing very convincing “needs” in front of you, which may steer you away from what you really want.

Below are some questions that can help you better understand what motivates you.

What are your priorities?

 What do you value most?

 What would you do if you had all the money you wanted right now? What would you buy and what would you do with your time?

 

Posted in Saving Money | Tagged , , | Leave a comment

Take the loss

IMG_2944

Cut your losses and start out on a new path

Take the loss so you can move on quicker to better things. It’s frustrating and sometimes painful to admit a loss, admit things aren’t going to go the way we wanted them to. We worked so hard and were so sure this was the move we were supposed to make. When that moment comes, when you know you need to take the loss, it’s best to just take it, learn what you can from it, and redirect your energy into something more profitable.

I think that taking the loss is harder than saying it. I think it’s hardest to move on when we think we’re close to a break through. We also consider our past investments in the situation and do not want it to go to waste.

Romantic relationships are one of the more difficult ones for me to cut my losses and move on. People are complex and their feelings can change quickly, so when I invest a lot of time developing a relationship and we have mutual hope for the future, then when feelings change on the other person’s part, I can struggle at first to accept the loss. It’s the investment of time and energy that make it so hard to take the loss. I hate thinking all the relationship development was for nothing. The thing is, sometimes it is for nothing. You’ll always have the experience to learn from, but once you know better, once you know it’s not going to work out, take the loss, regroup, and look for someone who is a better fit for you. No sense continuing to put ANY energy towards someone who doesn’t see you in the role you thought you’d be. Send them love and blessings in all areas of their life and move on.

Romantic relationships are the biggest area that I focus on making sure I accept and take my losses, but your area may be different. Maybe you struggle to take a loss when an investment doesn’t work out. Maybe you bought a rental property that is losing you money each month. Consider if there are areas in your life you would be better off taking the loss, learning from the experience, and redirecting your energy elsewhere.

Posted in Investing | Tagged , , | Leave a comment

Finding Your Investment Style

IMG_8913

May your investing research give your future as much promise as this glorious morning sky view in San Jose

I’m going to be up front, based on the research I’ve done and considering my lifestyle and values, I believe value investing is the best form of investing style for the long term and building substantial wealth. However, I know people have different goals, skills, and personality traits, so I don’t want to discredit other investing styles. I do believe you should research the different investing styles, reflect on them, decide on a style, and consistently stick to it with periodic check ins to see if it still resonates with you.

Consistency is important. It will give you time to fully develop your skill set. Don’t be quickly swayed by differing opinions. Consider all advice, but designate a time, maybe yearly, to evaluate your investing style again. Otherwise you risk switching from style to style quickly, without giving yourself a chance to flourish. It’s like constantly uprooting a flower to put it in a better environment; yes, some environments are better, but the act of uprooting the flower for minor improvements is more damaging than giving it a chance to grow in its current environment.

Step one in determining your investment style is to think about your goals and how much time you want to spend towards investing. Consider the following questions to help you determine what investment style might work for you:

  • Do you want consistent income in the form of dividend payments?
  • Do you want lower taxes taken out of your investment earnings by holding onto investments greater than one year?
  • Do you want to spend several hours researching a company prior to investing, but then have the assurance that the company has strong financials and even if the stock drops some, will come back over time?
  • Do you want to make potentially large amounts of money quickly?
  • Are you ok with having to check in on your investments several times a week?

Step two is to consider your self-reflection from step one, while researching different investment styles. Below I dive into some details of two of the prominent investing styles: growth and value investing.

UntitledInformation about growth and value investing was found on the Investopedia website, located at http://www.investopedia.com/terms/g/growthstock.asp and http://www.investopedia.com/university/value-investing/value-investing1.asp.

This is quick overview of two prominent investment styles. Take some time to look more into one that resonates with you. Start small with investing and learn more with each purchase. Best of luck to you on your investing journey!

Posted in Investing | Tagged , , | Leave a comment

Spark Your Frugal Creativity by Imagining a New Standard

IMG_4025

Sun Voyager Sculpture in Reykjavik, Iceland – Intended to convey the promise of undiscovered territory, a dream of hope, progress, and freedom.

What if you absolutely had to spend significantly more on housing or another expense? How would you get by? This article is all about putting yourself in a creative state of mind for money savings.

A few years ago I planned a trip to Iceland. It was a fantastic trip and everywhere I turned I saw something new and enchanting from the landscape to the citizens behavior towards women. One of the many interesting things was the cost of food. For a bowl of stew, which seemed to be sometimes the only option in a town, the cost in US dollars was nearly $20. I had always associated prices like that with luxurious living, but it was just the norm there. People still went on living their lives and adapted to the price of food.

I’ve also experienced living in a part of the country where the average cost of a one bedroom apartment was $917 to a part of the country where the average was $2,483. This is without a significant difference in salary. That experience greatly improved my frugal creativity.

My point is, when forced to, you can find money hidden in your habits that could be be saved and invested painlessly.

Take Sweden for example. Their average savings rate from 1999 to 2017 is 12.89%, compared to the United States’ of 8.3% from 1959-2017. Yet the price of food is more expensive. For example, a BigMac costs 4% more in Sweden than in the United States. How are Swedes able to save more when they’re spending more on food?

I know it’s not as easy as looking at a couple numbers and coming to the conclusion that our saving skills are bad, but maybe there is still something to learn from evaluating the habits of countries and cities that are able to save more even amongst a higher cost of living.

So here’s an exercise to fine tune us into sleek and clever savings masters.

  1. Pull up your budget (creating a budget advice can be found here!)
  2. Pretend you moved to San Jose, CA and change your housing cost to the average for that size of apartment size or house in San Jose.
  3. Now go through all other expenses and write down where you could save money to accommodate for this increase in housing cost. Maybe you have to make several changes to your budget such as, find a cheaper cell phone plan, eat out less or at cheaper restaurants, buy toiletries at the dollar store, etc. You may also consider new ways to make money. Continue to evaluate expenses until you are able to afford living in San Jose.
  4. Go through the list created in step 3 and see if any of the expense reducing and income increasing ideas seem mostly painless and would not significantly reduce your quality of life.
  5. Enact the painless money saving ideas discovered and redirect those savings to your savings account.

In a month come back to this exercise and do it again; you will find even more ways to save that do not significantly change your quality of life and are painless.

 

Posted in Saving Money | Tagged , , | Leave a comment

Leveling Up

IMG_6055

California palms trees are always good to see

How many people do you know that significantly changed their socio economic status? People who went from working two minimum wage jobs and feeding their kids fried bologna sandwiches, to changing class levels and moving onto dropping their kids off at private school and picking up not just a coffee, but also those expensive breakfast sandwiches at a coffee shop on their way to their job that has health insurance and a quality 401k matching plan. Based off of research and if you’re in America, then I would say you don’t know too many people who’ve had that change in lifestyle. In America, half of all children born into extreme poverty stay in extreme poverty.

I don’t want to discourage anyone, but what I’m leading to is that we can’t wait for politicians to work out the issues of our country’s limited and difficult social mobility. The issue could be our extreme incarceration rate, systemic racism, classism, access to quality education, access to health care, or a combination of all those things and more. If you’re called to activism, you can work on solving those issues, but in the meantime we still have to find a way to get to the next level. I have some ideas. Are you ready to do this?

  1. Imagine a different standard. If you want to level up, you have to take your mind to a place it hasn’t been. Perhaps you haven’t been around millionaires or billionaires. Perhaps you haven’t been around people who aren’t in debt and make six figures a year, but you want to be at that level. It will be difficult to get to that level if you keep following the behaviors and habits that everyone around you follows. You have to be different. You have to imagine a different standard. How would someone who is a millionaire behave if they were you and in your current situation?
  2. Be patient. As you’re developing new behaviors and habits, it might take some time for you to see the improvement you’re looking for. I can say from experience that changing your fitness, eating habits, improving your communication, etc. to make lasting change, has taken some time. Steadily keeping my ideal goal in mind and gently working on one habit at a time, profound change eventually took root.
  3. Trust in the process. Leave the stress for those big moves you’re going to make. There is less stress when you truly believe in your future. And you should truly believe. Why not you? It might not happen exactly when or how you want it to, but believe it will happen and you will have an intoxicating calmness. And remember, you have to get better at not letting little problems bother you. If you can solve the problem easily, do it, and don’t talk or complain about it anymore. Imagine a future where you’re making million dollar deals and working with international partners. In that future, you don’t have the time or energy to spend 30 mins complaining about the flat tire you got or that rude coworker who keeps interrupting you. You’re going to be so successful; have compassion on the people who bother you and who don’t respond to calm communication, they’re struggling to work through their own issues.
  4. Wake up early and read. I try not to be too specific in my advice because I know everyone is different and has to follow their own path, but this habit was so significant in changing my trajectory that I want to strongly encourage you to wake up 30 mins to an hour before you have to get ready for the day, find a comfortable spot, grab a coffee, tea or whatever and crack open a book that speaks to where you are in your process. Some of my book recommendations are: Emotional Intelligence by Daniel Goleman, Crucial Conversations by Joseph Grenny, Al Swizzler, and Ron McMillan, and Outliers by Malcolm Gladwell.
  5. Ask someone who is better than you for advice. This helped my career extensively. I used to be so competitive that is was hurting my success. I would be so competitive with my peers or even those ahead of me that I would never ask anyone for help. However, one day I got over my pride and asked someone at a higher level, to give me advice. She agreed and ended up giving me tips to significantly improve my performance. To this day, if anyone is good at anything I try to ask them to teach me about what they do. It has definitely sped up my progress. And sometimes people are only better than you in one area. That’s ok, you can still learn from them in that area. You don’t have to take all the advice, just listen to them in the areas they are excellent at.

Let me know if you have tried any of these tips, and if you have additional leveling up tips, please post them in the comments for myself and others to read. This is a team effort ❤

Posted in Career | Tagged , , , , , , , , , | Leave a comment