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Jul 32017

Best Low Maintenance Way To Invest $30k

By |July 3rd, 2017|Blog|2 Comments

Best Low Maintenance Way To Invest $30kWe’ve discussed what living off a million dollars would look like, but what if you receive a smaller amount of money like $30k? What are the best ways to invest $30k?

Pay Off Debts

When it comes to money and investing the number one 100% guarantee is paying down debts, especially credit card debt. If your interest rate on your debt is 5% or lower then investments will make more than paying off the debt, however if it’s more say 15% then paying that off first will save you more money then any passive investing of $30k will do.

Lets say you have $10k in credit card debt at 15% that means you’ll pay $1500 a year in interest. Many people have even higher interest rates so consider that when deciding the best way to invest $30k.

Create An Emergency Fund

This isn’t at all an “investment” producing money but one that produces peace of mind. If you only have your credit cards for emergencies and are unable to pay them off then the interest cost more than any investment.

You may even have to call around and beg friends and family to borrow even small amounts of money if you don’t have an emergency fund in place. Usually 3 to 6 months of pay is good to have but depending on your job it may be more or less to make you feel comfortable.

Buy Low Cost Index Funds

If you’re only interested in investing for a few months to a few years than it’s best to just keep the money in a savings, money market, or CD. However if you are looking at a 10 year or longer outlook then there are far better options.

In my opinion the best way to invest $30k is to start a business, however that’s incredibly active investing. For investing you can do once, check on a few times a year and when you need it has grown you need to invest in low-fee index funds.

Vangaurd is widely known as the best fund manager there is and offers many options. Depending on exactly what you’re looking for. You can invest in the total market index fund, a real estate index fund, a dividend producing index fund, target date funds, and others.

For most people the target date fund will be the best. Figure out the point in which you will want to withdraw your investment whether that’s for retirement or anything else and pick the target date fund the corresponds with that date.

Have A Robot Do It

In the past the only way to invest in the stock market was to call a stock broker and have them place an order for you. Now with the internet you could have a huge portfolio and never once speak with a broker. Even better is the recent increase in robo investors.

If you really don’t want to think at all about your investment and just want to receive the interest then the best way to invest $30k is one of these robo investors.

Places like Betterment and Wealthfront will take some information about you then invest your money for you with you not needing to think about anything. For those trying to invest without having to think about it you don’t get any more hands off.

Disease Called Debt

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Jun 262017

Chesley Sullenberger’s Net Worth

By |June 26th, 2017|Blog|2 Comments

Chesley Sullenberger's Net WorthHistory

Chesley Sullenberger was born on January 23rd, 1951 in Denison Texas. He graduated from the Air Force Academy in 1973 wish a B.S and served for 7 years reaching the rank of captain.

Chesley Sullenberger’s Career

His career in the military started in 1973 and ended in 1980. Afterwards, he began working for US Airways and did so for the next 40 years until his retirement in 2010.

On January 15th 2009 Chesley Sullenberger’s plane ran into a flock of geese forcing him to make an emergency landing in the Hudson. This act not only saved his life but the 155 other people on the plane. This also gave him a certain amount of fame.

Chesley Sullenberger’s Net Worth

Chesley Sullenberger’s net worth stands between $1.8 and $2 million dollars, no small number. However, if you factor in his long career (nearly 50 years) that number seems less impressive.

Add that to the fact that after US Airways flight 1549 he was able to add to his income a book deal Highest Duty: My search for What Really Matters, and then a few years later a second book Making a Difference: Stories of Vision and Courage From Americas Leaders.

If you compare Chesley Sullenberger’s net worth to many of the others we have discussed on this site it seems low. However, he was just a normal guy till a few years ago, and what he did doesn’t make money. He saved people’s lives and though people that do that deserve to be rich few are.

If you think that by selling those two books he was able to make a large amount of income then you overestimate a number of money authors make. No, he saved his money slowly investing it over a nearly 50-year career allowing him to retire completely in 2010.

Lessons Learned

It can take considerable time for wealth to grow. Chesley Sullenberger didn’t simply wake up a millionaire one day, he started as a thousandaire and grew from there.

That’s the best way for all of us to become millionaires someday. Start small, even just a few dollars, then a few more as time goes on that little amount grows to a lot. Compound interest and regular contributions can turn your thousands into millions.

Chesley was able to work well under pressure, saving himself and 155 others. He had years of experience and training under his belt that allowed him to do this, but at the end of the day being able to work under pressure saved all those people.

Though we will likely never be under the same kind of pressure, we can make sure we gain as much experience and training when we start a new endeavor. Want to start a business, start learning everything about the type of business you are getting into. And when you feel the pressure of starting such a business you will do well.

Chesley had saved money for years, but when he got a little fame from saving others he jumped on it and wrote a book. Though it didn’t make him rich it did add to his income.

We need to be ready for when things come our way if we see an opportunity to move up in the company or move across the country or buy an amazing investment, we want to be ready to take advantage.

Disease Called Debt

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Jun 192017

Can I Live Off Interest On A Million Dollars?

By |June 19th, 2017|Blog|Comments Off on Can I Live Off Interest On A Million Dollars?

Can I Live Off Interest On A Million Dollars-We often talk about how many cars, houses, and other things we would buy with a million dollars.
We even dream about never working again and just living off that money with a drink in our hands on the beach. But can you really live off the interest on a million dollars?

Maximum Return On Interest?

In a previous article, we found that the largest interest return you could currently get would be around $23,000 a year.

There are however other places you could invest your money that would provide more income. For instance, you could invest in real estate or the stock market. Both would generate income that you could live off of.

Even investing in the Vanguard high dividend fund will provide you with over $30,000 in income per year.

Real estate is more difficult to figure out a percentage, however Paula Pant from Afford Anything says you should find a property that the rent is 1% of the cost of the building. So for a $100,000 house, you would get $1,000 monthly ($24,000 annually) in income. If you invest that million that would generate $240,000 a year of income.

Again these are not interest, but ways to invest your money in producing more money.

What do The Experts say?

A study called the Trinity Study basically says that you can safely withdraw 4% of your investments every year and as long as you have 25 times your annual expenses saved you will never run out of money.

This is based off on average the stock market has done 7%% to 10%, there are some years where the stock market lost money, and years where it has made much more. But if you take the average and then spend less then that, you should, in theory, be able to live off that income forever.

Can I Live Off Interest On A Million Dollars?

The average household income in the United States is around $57,000 a year. Some reading this make considerably less and think that’s a lot of money. Others read that amount and have no idea how you could live on so little.

But can you survive with the interest that comes from a million dollars?

The answer is most people couldn’t, with the maximum amount of interest you could receive of $23,000 through a CD. That’s well below the average income, as well as the poverty line for a family of 4.

That doesn’t mean you can’t live off that money, Jason Fieber lives off much less, but he is the exception rather than the rule.

If you invest in dividend funds, real estate, or the total stock market, you can receive much more income that will also go up year after year.

What Now?

If you can live off $23,000 and you have a million dollars in the bank, you’re done congratulations. If not then it’s a nice start towards your retirement. You could use that money to invest in the stock market, real estate, or even start your own business. Whatever you do enjoy your life and don’t let money be the reason you don’t.

Disease Called Debt

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Jun 122017

How Much Interest Will I Earn On 1 Million Dollars

By |June 12th, 2017|Blog|Comments Off on How Much Interest Will I Earn On 1 Million Dollars

How Much Interest Will I Earn On 1 Million DollarsIf I had a million dollars I would buy… We all have thought about it, talked about what we would do. Notoriously someone in the group will always say “I would just live off the interest” and they’ll use some math that makes the interest sound like a lot of money.

But can you really “live off the interest”? How much interest will I earn on 1 Million dollars?

Interest VS Capital Gains VS Dividend Payments

It’s important to note that there is a difference between what interest actually is, and what people typically think of as interest.

Capital Gains are defined as the profit from the sale of property or investment. So if you buy a house for $50,000 fix it and sell it for $100,000 your capital gains are $50,000 (this is very basic and there’s much more that goes in to it, but for ease of argument bare with me). What most people think of is the stock market, buying and selling for the capital gains. Though yes this is possible to do, especiially if you are starting with 1 million dollars, it isn’t interest.

Dividends are amazing, and dividend paying stocks even give you the dividend yield as a percentage. This may lead to even more confusion when it comes to how much interest you earn, because though it seems like a dividend yield of 3.4% is 3.4% interest that isn’t at all the case. Yes it’s a solid investment and a great way to make passive income, but again not interest.

Interest is money paid regularly at a particular rate for the use of money lent. In other words interest is money paid to you for allowing others to use your money.

How Much Interest Will I Earn On 1 Million Dollars?

With what interest really is in mind, the question now is how much interest will I earn on 1 million dollars? Well that depends on where you put your money, so let’s break down 5 places you can have your money and how much interest you’ll get from each.

Interest From Checking Account

According to NerdWallet’s rating of 17 online checking accounts interest rates range from 0.10% to 1.5%. So getting a calculator out will bring interest on a million to $1,000 to $15,000.

Interest From Savings Account

Savings accounts don’t offer much more then checking accounts ranging from 0.9% to 1.3% or $9000 to $13,000 annually.

Interest From Money Market Account

Money market accounts run right about the same as checking or savings with the highest I was able to find of 1.31% bringing in $13,100 annually from interest.

Interest From Certificate Of Deposit

The highest of the interest rates you’ll find with the highest I was able to find of 2.35% would bring in $23,500 annually. However you would have to invest in a 5 year CD meaning you wouldn’t be able to collect any of the interest for 5 years. The best thing would be to create a CD latter so that every 6 months you could be collecting interest.

There’s Another Way

With the average household income over $52,000 the amount of money you would get from interest on a million dollars wouldn’t allow you to quit. However there are other ways to make money from a million dollars, other ways to care for your bills using that million dollars. In an upcoming article we will discuss how we can live off of 1 million dollars.

Disease Called Debt

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Jun 52017

How To Get Out Of A Timeshare

By |June 5th, 2017|Blog|4 Comments

How To Get Out Of A TimeshareVacations are some of the most important, if not the most important part of our lives. Yes, work will make you money, but what’s the point in making said money if you never enjoy yourself?

For many they have decided to buy a timeshare, thinking that would be a way to go on vacation more often, possibly saving money in the process. But, they soon find out that not only was it not a good investment, but it’s one that is incredibly difficult to get out of. So here is how to get out of a timeshare.

What Is A Timeshare?

A timeshare is a part ownership of a vacation home, or rather the rights to the said home. Most of the time you get 1 week with said property and usually the same week per year, though many have some exchanges of weeks.

On top of the initial investment (which can range from nothing to hundreds of thousands), you also have maintenance fees to pay yearly. Though this isn’t always excessively high, they can be sometimes even more so than the cost of the timeshare in the first place.

Why Would You Want To Get Out Of A Timeshare?

Though for some people having a timeshare is great (my aunt and uncle have had one for as long as I can remember) there are others who would gladly give it away for nothing, why? Because of the fees involved, and the restrictive nature of said timeshare.

Like I mentioned earlier the fees are always excessively high sometimes $500 to $1000 a year. However, it can become much much more making it not cost effective to keep the timeshare. Consider staying at an Airbnb with the cost of $75 a night. This would come out to only $525 for a week saving you thousands over the maintenance fees, and more so considering you have to make an initial investment.

How To Get Out Of A Timeshare

If you have just got your timeshare you may still be able to get out of it. Most timeshare contracts have a grace period where you can cancel so the first thing I would check if trying to get out of a timeshare is if I was still in that grace period.

If that isn’t a viable option find out if it’s possible to sell the timeshare. You may call a real estate agent who is familiar with your area or even in timeshares themselves and asks for their advice. They may even have sellers in mind looking for a place.

If selling seems impossible then give it away. This may feel like throwing money away, but it may save you money in the long run since you no longer have annual fees to pay. Be up front with whoever you are giving it to as to the reasons why. Especially if it is a friend of family member, never sacrifice personal relationships for money it’s too high a price to pay.

Disease Called Debt

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May 292017

Does Financing A Pet Make Sense?

By |May 29th, 2017|Blog|2 Comments

Does Financing A Pet Make Sense-They say a dog is a mans best friend, and though I personally prefer cat’s over dogs really any pet can bring joy to your life. But, what if you can’t afford to get that adorable puppy or kitten that you just fell in love with? Do you give up walk away and hope that another one is there the next time? Here are a few ways to finance a pet.

Credit Cards

If you have a firm grasp on your debt and know you can pay things off before interest hits, or at least not much interest, then credit cards may be a good option for financing a pet.

The first step would be to make sure the credit limit available matches the pet you want to purchase. Even if you have a $5,000 credit limit there are pets that cost more than that.

30 Day Same As Cash

Another option many pet stores have is the 30 day same as cash option. Basically you pay what you can at the time of taking the pet home. Then you have 30 days to pay the amount in full. You may choose to pay a certain amount every paycheck for a month, pay daily, weekly, or whatever works for you.

The only word of caution here is make sure you really can pay for the pet within that 30 days if not you may be hit with some pretty hefty fees, or have the animal taken back after you’ve become even more attached then you were when you first met.

Wags Lending

Getting financed before you even go to a store to find a pet is another great option. With Wags Lending this is fast and easy. You simply go to the website fill out the form and will be approved right then.

You then make payments as you go and have the option to buy out the lease at any time, which could ultimately save you money.

Paypal Credit

If you’re buying a pet online odds are that you will be asked to use paypal as the payment service. If that is the case you may qualify to get paypal credit which would let you get a pet today rather than waiting until you have the cash.

Another great thing about using paypal credit is that it gives you 6 months interest free if you spend more than $99 meaning most animals you buy would give you a “6 month same as cash” option in a way.

Does Financing A Pet Make Sense?

With all these great options you may have decided that you are getting that adorable puppy you saw in the mall this weekend, but have you really counted the costs?

Yes a dog is a mans best friend, and I personally love having animals around. They make good days great and bad days tolerable. There is no doubt that having a pet will bring joy to your life. But if you look at how much interest you’re paying for that joy that does sometimes lessen the joy.

If it does make sense to finance a pet to you then by all means use one of these great options. If however you would rather wait until you can actually afford to pay for said pet in cash, that option may be better for you.

Disease Called Debt

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