You’d be surprised just how many people have been in a situation where they have finally garnered enough money to renovate their house and when everything was finished, an idea to sell the whole thing for even more money started to occupy the mind. Well, some of those individuals actually went down that road and made a commitment in order to make a decent living; so if you have the urge to do the same, but aren’t quite sure where to start, let’s get you acquainted with some facts before you go through with this demanding endeavor. Now, don’t go thinking that house-flipping is easily done like in those high budget TV shows where it takes a few days and a huge crew to turn an old, time-devoured place into an expensive dream-house again. It involves a lot of planning, collaboration with contractors, and rolling up your sleeves and getting dirty. Before you even begin fixing things, know that everything primarily depends on the current state of the house as well as the cash you’ve spent on acquiring it, so you can compare and estimate just how much a house-flip pays off. Not every house will do you justice This should be treated like a postulate. It is like when people with big egos who are pretty confident that they can do everything with ease and certainty suddenly face a wall that takes too much effort, money and time to penetrate. No, you have to play it smart, so before you get your demolition hammers and power drills, you need to be able to determine whether a home is redeemable or not to begin with. Learn to pick your battles. Check the entire estate, identify the weak spots, and take a close look at everything possible (living area, basement, attic, backyard, plumbing, wiring, etc.). Once you make a list of things that need repair, do the math and estimate if “flipping” is worth it. Getting what you want at the best price possible This may require a little vulture business, but you have to be a bit of an opportunist if you are to survive. The best places to fix are those that real estate agents need sell fast and easy. Homeowners who are willing to sell at a price below the market standards are usually those who have financial problems, are unemployed, are getting divorced, are being transferred because of their job, and other similar reasons. However, bear in mind that structural problems may drastically decrease the value, but it can increase the money needed for investment in order to correct such extensive faults. Once again, a sound inspection is crucial. Quality isn’t necessarily expensive Considering that you have completed the paperwork and you are now the owner of the house that needs renovation, it is time to go window shopping. Now, there is a logical assumption that costly fixtures, installations, and other home components are more durable and pleasing to the eye, but we all know that is not necessarily true. Think Conveyancing team advises that sometimes you just have to do some decent searching, make contacts with retailers, experts, contractors, handymen; and with a little luck during negotiations, you’ll be able to get the quality services and items at a much more affordable price. This will leave you enough money on the side for better furniture, wall paint, and other investments. Conclusion One final word of advice – check the law regarding such matters in your country/state. Who knows what complications may ensue because of legal regulations, so opt to contact professional help in order to avoid such potential pitfalls. Try to keep things realistic, do more research if needed, and estimate the flip costs, real estate commissions, insurance, taxes, loan interest, utilities, and other financial factors. Prepare yourself! It is a fun project, but nothing close to naïve.
Category: Finance
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Can You Make Money From House Flipping?
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Once-In-A-Lifetime Trips – Here’s How To Afford Them
As Dailymailreports, in a recent Reddit thread, thousands of anonymous airline and airport employees have revealed some of the most shocking and entertaining secrets about their profession. Did you know that the headsets offered to you by the airline are not brand new, despite being wrapped up? One user reveals that they are merely cleaned and re-packaged. Another user advised everyone to skip out on the coffee, because the containers are not cleaned regularly. In addition, if you are a frequent traveler, you should note that the cheapest time to buy a plane ticket is Thursday afternoon, and the cheapest time to fly is Tuesday, Wednesday or Saturday.
If you have “itchy feet”, chances are that the expenses are your number one concern. Yes, there is such a thing as economical traveling, however, after adding up the traveling rates, daily costs and lodging; even the low cost trips will have a great impact on your bank account. So, what are the things you have to do to keep up with your traveling spirit and be cost-effective? Well, here are some of the ways you can satisfy your “itch” on a limited budget without skipping on your rent:
Specify your travel goals
Even if you are ready to depart on the next available flight, try to focus that excitement into one travel goal at a time. This does not mean that you should restrict yourself from dreaming about multiple traveling goals, but it will help you plan the best direct path to your goal without diverting your money or attention elsewhere. Unless you have a flexible work schedule, your best bet in budget travel is to choose one travel goal and stick to it. So don’t plan on visiting Thailand, plan on visiting one particular region, focus on one place, or more, but maintain your focus at all cost.
Calculate your travel expenses
Once you set your goal, you have to consider the complete costs of your trip. Therefore, consider all your expenses because a trip is made up of much more than just an airfare. Calculating each specific expense can give you the most honest estimation of what is within your means. There are plenty of travel budget calculators available on the internet to help you compile the costs. In addition, if you are looking for good early bird deals and fixed exchange rates you should consider using Travel Pay.
Timeline your trip
Ever noticed how some people make the toughest trips seem like a casual walk in the park? Nine out of ten times, these folks time lined their journey before they even started packing. The timeline of your trip can be the deciding factor in your budget, in what you need to pack and how to choose the best method for managing your financial goals. If you have problems making a perfect itinerary, there are plenty of mobile apps and websites that allow travelers to build great trip timelines and share them with their loved ones and their closest friends.
Most of the people have limited vacation time and resources. This is why the great majority of us plan our trips months in advance. My final recommendation for restless adventures would be to check out locations closer to your place of residence. Establish a schedule and have a few thrilling trips and sightseeing walks between your big trips. And when you are traveling big, make the best of it. On a reasonable way.
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Tried and Tested Debt Collection Strategies
More than 50% of all startups fail in first few years of doing business. Inability to collect debts is one of the major reasons that leads startups to bankruptcy, because for business to function well, companies require constant money flow.
Since debt collection is such a hard and an unpleasant experience I’ve listed some of the most effective strategies that can help entrepreneurs to recover their debts and make their business lucrative again.
Determining Payment Policy
Each contract made for the purpose of selling goods or services should contain payment policy that determines schedules, ways and amounts customers are obliged to pay to goods or services providers. Different payment policies might include measures that should motivate customers to pay their debts on time. These special measures might include:
- Late-payment fees– fees that are added to the debt amount when debtor doesn’t settle the debt in agreed time. Regular late-payment fee range from 1% to 3% of the whole debt.
- Advance payment– companies can ask their customers to pay up to 50% of their debt up front.
- Interest– interests are added to the debt amount after customers fail to pay their debt in agreed time. Debt interests are regulated by federal and state laws, which means that companies first need to consult the law before adding that article to the contract.
- Due dates– contract and each bill that’s being sent to customer needs to contain due dates, after which late-payment fees and interests are being added to the debt amount.
Staying in Contact
One of the main strategies to make customers paid their debt is by maintaining constant contact with them. Debtors should be contacted by several different ways:
- Reminder bills– these notes remind customers that their debt is past due date.
- Phone calls– this way customers should try to get a verbal agreement and a new due date, until the debt is going to be settled. When calling debtors, company officials should avoid phone harassment, they should also talk in civil tone, identify themselves, and state the reason for calling and their desire to keep positive relationship with the customer.
- Demand letters and e mails– these letters should have a more demanding tone (but shouldn’t sound threatening) and should present next steps company will do to collect the debt.
Negotiation
Secret of successful debt collection is in understanding debtor’s situation and that’s why negotiations with debtors are very useful. Here company officials can offer discounts and longer deadlines. Although most people think that this way the company is losing its money, it is much smarter to make these exemptions and never deal with debtor again, then to continue with debt collecting routine and settle in court, which also comes with its share of costs and lots of uncertainty.
During negotiations company officials also need to inspect the possibility that the debtor will declare bankruptcy, which can cause plenty of legal troubles and requires hiring a lawyer or debt collecting agency.
Hire Professional Debt Collectors
This is probably the most certain and the easiest way to collect debts. Sure agency will take its share of the money, but this will cost much less than a court settlement or some other similar arrangement. Sometimes choosing a debt recovery agency is not that easy. When doing that, company management needs to check these things:
- Whether the agency is licensed;
- Whether it is bonded and insured;
- How big are the fees and in which way do they charge them;
- Whether agency is offering debt portfolio screening;
All these determine the agenci’es profile, and for most debts, agencies charge fees after the settlement, which in some cases means that company can get their share of the money right away.
The only strategy we didn’t mention in previous paragraphs is the customer and business partner screening, which tells the company how responsible they are when it comes to debt payments. This can prevent many invoices turning into bad debt and it is especially important for B2B deals. If even with these precaution measures you end up with unpaid debts, the above mentioned strategies will make collection much more easier and less stressful.
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Financial Tips for Post-Graduate Life & Beyond
In college, whether you were on the straight and narrow four-year plan or the winding and sidetracked six or seven-year plan, there’s a sense of accomplishment and relief when the end is in sight and a diploma is in your hands. Your financial future, however, may be daunting and full of expectations. As long as you can remember, you were told that as long as you work hard, you’ll get ahead in life.
Unfortunately, a diploma doesn’t automatically guarantee a planned out future and financial security as soon as you graduate. If you have a dream job lined up as soon as you exit your university, consider yourself lucky. According to After College, a job site for new college graduates, only about 14% of college graduates had “real” jobs lined up right after graduation in 2015. While you’re looking for the right job, here are some personal finance tips to keep you afloat:
- Create a Budget: Maybe you thought your days of scrimping, saving, and eating ramen were behind you. Even if you have a decent paying job after college, it’s important to create a budget and learn to stick to it. When creating a budget, figure in all your expenses (even the ones that aren’t a constant), as it’s important to know how much money you really have to work with. Once you have figured out your monthly expenses, such as rent, student loans, food, car payments, and “fun” stuff, you may feel underwhelmed by the amount of money you are actually making.
- Stick To Your Budget: If you want to have splurges throughout the year, such as concerts, dinner with old college roommates, or gifts around the holidays, you will have to stick to your budget. If it means going out to eat less and learning how to become a better cook and a coupon-clipping shopper, go for it. It’s a good idea to revisit your budget every couple of months to make sure you’re being financially responsible.
- Avoid Debt, Try to Be Positive: Life right after college can be a bit “dark”, especially if you feel like you are limiting yourself from having fun, but as an educated adult it’s up to you to be creative and enjoy what you want in life. Don’t get go on vacation with friends? Host a backyard BBQ potluck and invite new friends from work and old friends from college.
It may be tempting to open another credit card if you’re financially strapped, but unless you can make the monthly payments on time, don’t do it. Make the best of your life right now, it’ll get easier if you’re wise with your personal finances.
Your Job as a College Graduate
Employment after college is crucial. Even if you’re completely burned out and would like to go on some sort of a “soul searching” journey, now is not the time. If you’re not finding the “dream job”, don’t worry, a job doesn’t need to be forever. Be open to all kinds of jobs and consider the ones that offer full-time, reasonable pay, and benefits.
You can always pay attention to the job market while already employed, but if you just wait for the right job to come to you, it’s likely your debt will be overwhelming. Another important thing to remember is to treat each job like a “real job”. While it may just be a stepping stone in your life, it’s an important one.
Placing Loved Ones in a Retirement Home
Once your career has taken off and you are successfully managing your personal finance, paying off student debt, and making enough to purchase your own home, a few decades can fly by quickly. At the peak of your financial success, you may find that your aging parents are ready to move into a retirement home. Here are some things to consider before helping your parents take this big step:
- Can Your Parents Afford to Live in a Retirement Home?: Even if your finances are secure and growing over time, your parents may have little to live on. Personal finances can change for various reasons, but many elderly individuals face issues with pension or Social Security. Before you help your parents make a decision, take a look at their finances.
- Consider Your Options: If your aging loved ones are able to get around in their home, maybe they could benefit from a live-in caregiver or one who stops over on a daily basis. This may be a cheaper and temporary alternative, but may buy you some more time as you research the best retirement home.
- Will You Have to Chip In? If your mother or father would benefit from living in a retirement or nursing home, will you need to chip in and pay for the difference not covered by Medicaid? Do your research and talk with homes. If your parents have a limited income or health issues, they may be eligible for assistance. Look at all your resources and talk with a financial planner if you’re running into financial hurdles.
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Smart Ways to Teach Children about Money
As soon as they can count, start introducing your kids to money. Start by letting them see and feel all the various notes and coins. And, as they get older, start raising their financial awareness step by step. Explain to them the concepts behind money through everyday activities, and get them into saving and spending money by giving them pocket change. This way, your child will get to know the basic clockwork of the finance world, which will also affect their development. And, ultimately, you will have raised a smart individual, who knows how to handle money responsibly.
Money Doesn’t Grow on Trees
Include your children in your daily financial activity. Be it a trip to the ATM or the bank, you will want to teach your children how money is obtained. They consider that invisible money, so explain how they don’t hand out money just like that. Talk shop, and explain how money is the reward for all the hard work and perseverance you put into your work. They will appreciate you and your job more, and will get to know how the world functions.
Give Them a Run for Their Money
Start giving your kids an allowance. There is no better way of teaching kids the value of money than by letting them taste it for themselves. Kids will come to realize how everything costs money, and if you want to get something you have to earn it. Furthermore, you can get them to do chores. They will help around the house, and learn the value of an honest day’s work. More importantly, this will help build their character, make them more self-reliant, enterprising, and hard working.
Save up for a Rainy Day
Cute little girl plays with money, isolated over white You should teach your kids to save money. A notebook can be a perfect way to store receipts, and manage their budget. This will allow them to always stay on top of their costs. And, for storing all that money, provide your kids with a piggy bank. They may not save up most of their allowance there, but it is certainly great to teach them the value that spare change has in the long run. When your kids get old enough, you can open up their first savings account. You can also use cool math games to teach them about interest rates and how it affects their savings. They will feel more grown up, and get a boost to their self-confidence at the same time.
Don’t Spend It All at Once
Teach your children to spend their money wisely. Let them make a wish list and set their priorities. They will get a sense of what they want, and have
a goal set. Incorporate the concept of waiting it out. Fun math games will let them calculate how long it will take, and they will stay focused. This will ensure that they never spend it all in one place, and not as soon as they receive it. And, with important items always on their mind, they will learn to never waste money. Also, with all the effort they put into reaching their goal, they will appreciate the things they buy that much more.The Right Price
Ask your children to help you with the shopping. You can teach them how to make a proper shopping list, and how to find the best buy. They will learn how brands affect price, and how they can save money by going for the alternative. Also, they will get a sense of when to consider quality over price, and how quantity is sometimes the cheaper way to shop. Moreover, a supermarket is a great place to add a bit of skepticism to your children about brands, ads, and supermarket tricks. Explain the goals of the supermarket and the product manufacturers, and how it’s not the customer they always have on their mind.
In the end, it is important to remember that kids start out with no concept of money. And, even though we all wish it could stay that way, the world doesn’t work like that. However, teaching your children early on will prepare them for the world ahead. By introducing children to their own money, and including them in everyday activities, they will become smart financially savvy individuals with a healthy attitude towards money.
About author:
Tracey Clayton is a full time mom of three girls. Her motto is: “Live the life you love, love the life you live.” Find her on Facebook.
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Feeling the Squeeze: 5 Money Strategies for the Sandwich Generation
Life as it is can be a little hectic. Working full time, taking care of your children and still finding the time to treat yourself can be a chore. For some, it can get even stressful if they have to support their aging parents as well.
If you are busy raising kids and caring for an aging parent, then you belong in the “Sandwich Generation.” According to a survey by BMO Nesbitt Burns, cited by Huffingtonpost.ca, more than half of Canadians aged between 45 and 64 are feeling squeezed by the needs of their children, aging parents or both.
No matter how you slice it, balancing between your family’s needs and your aging parents’ needs can be a burden. Carefully planning a smart money strategy can help you take some of the pressure off.
Without further ado, here are five financial strategies to help you feel less “sandwiched.”
- Save for Your Children’s Education
If you are a sandwich generation parent, stretching your savings to provide higher education to your children can be extremely difficult. Although you might think there is still enough time to start saving, most parents don’t realize the severity of this problem until it is too late.
Fortunately, there is a solution. Registered Education Savings Plan, or RESP, is a savings plan sponsored by the Canadian government that encourages parents or other siblings to invest in their children’s post-secondary education. One of the main benefits of RESP is that the government can offer grants to eligible contributions.
Here’s how this plan works: Imagine you open an RESP account for your newborn baby and contribute $1000 into the account. Your provider will send the account and other information to the government for grant approval. If the grant is approved, then the government adds 20% of your annual contribution, up to $500 per year. Families with lower incomes receive a higher grant from the government.
When your children enroll to college, they can start taking money from the account, tax-free.
- Protect Your Parents in a Smart Way
Understanding your parents’ needs is the first step to protect and provide for them in a smart way. Although discussing finances with them can be difficult, helping them see that this is the best way for you and them is crucial.
Your parents might take for granted their capacity to self-function since simple tasks seem easy and automatic. But, when they lose their ability to self-function on a daily basis, they put a lot of stress on you. Long term care insurance is a smart way to protect your aging parents and to reduce future costs. With long term care insurance you will receive at-home nursing for your parents. Also, the insurance will provide for their basic needs, such as feeding, dressing or cleaning.
- Protect Your Income
Protecting your income is a smart money strategy, especially if you have multiple generations counting on you. There are different ways you can protect your income and your loved ones, such as life insurance, disability insurance or critical illness protection.
With almost half of Canadians being diagnosed with some form of cancer throughout their life and with the ever growing rates of heart disease, protecting your income is a wise decision if such a scenario would unfold.
- Look for Ways to Increase Your Monthly Cash Flow
For many, caring for both, children and aging parents can be stressful. That’s why it is a smart idea to look for new ways to increase your monthly cash flow. Look for passive income opportunities, such as selling old stuff on Amazon and eBay or affiliate marketing. Or you could stretch your mortgage’s amortization for a while to lower your payments. Although this is not a good idea usually, but in the short run can help you balance your finances while providing for your family.
- Care for Your Future Needs
You don’t have to be sandwiched to start planning for your future needs. Early planning can go a long way, and can take some of the financial and emotional pressure off your shoulders. Once you’ve got the basic costs of living covered, start putting money aside for your retirement or for unexpected events. Investing in a retirement account can save you takes and will keep your money from being easily spent. Not to mention that you will be able to cover your own costs of aging.
Caring for both, your children and your elderly relatives can sometimes feel like a burden. But, with the right financial planning, you can ease the financial and emotional strain.
Have you implemented any of the strategies above? What other tips do you have for the Sandwich Generation? Share your thoughts in the comments below.
Author Bio: Ben Rogers, Web Content Manager at Assiniboine Credit Union.
