Nov 21 2017

Do you save or do you borrow?

This blog uses affiliate links and maintains financial relationships with various partners. This is a guest post.


When it comes to personal finance, you can be categorized in one of two categories: Saving or borrowing. Which category do you think you fall into? Do you tend to save money when you can? Are you saving for retirement? Maybe you prefer using your credit card to cash? Living off credit implies you’re borrowing against any future earnings. Unless you’re paying off your credit card in full each month, you’re living off money you don’t have. Many studies have shown that most people tend to fall into the borrowing category and a large percentage of these people are struggling to make the monthly payments on time (or at all). Saving requires a paradigm shift. Here are a few things to consider:


How do you start?


Now, when it comes to saving, there is only one rule: Never spend more than you earn, which isn’t always as easy or straightforward as it sounds. It can be hard, but the most important factor is changing your view on personal finances. How much you start with doesn’t matter, you just need to start. You need to develop the habit of saving so set a budget each month and stick to it.


Once you’ve started saving, it is time to consider investments. Many people believe that investments are for the wealthy, but if you’re saving comfortably then it may be time to think about investments. Over time, investments can help you increase your earnings. If you come into some extra income (like a bonus or an increase) then consider using a portion of it to invest in a unit trust (a mutual fund) instead of improving your standard of living. You can even go a step further by committing to investing monthly via a debit order. Using this option allows you to set an annual increase, which gradually increases your contribution.


Start as early as possible, but really it is never too late. Any delay now means greater sacrifices down the line so it really does help to start early.


Five tips to shift from borrowing to saving:


Here are a few tips to help you with that paradigm shift. Changing a mindset can be very hard, but following these tips can help make it a little easier:


  • Start early! Compound interest can net you huge returns, but it requires time to work. To benefit you need to start as early as possible.
  • Start reducing/eliminating debt and don’t create any new debt.
  • Save before you spend.
  • If you can’t pay for it with cash (or debit card) then don’t buy it.
  • Fix your annual contribution increase and avoid negotiating with yourself.
  • Sign up to a regular financial newsletter to keep updated with the latest investment news and trends.


Sacrifice is never easy and for many it will feel like a sacrifice. It will be hard, but this commitment leads to great future returns. Make sure you are well informed to increase your chances of success. Define your goals and think about the resources and time you need to achieve them. If you feel overwhelmed then consider consulting a good independent financial advisor to help you make sense of it all.


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Oct 18 2017

The Workers Who Will Retire with More Money Than Everybody Else

This blog uses affiliate links and maintains financial relationships with various partners. This is a guest post.


According to a survey conducted by NerdWallet, millennial parents are out-saving parents from all other generations when it comes to retirement.

In most cases, there’s a wide margin: the NerdWallet survey found that amon

g all those who are saving for retirement, the millennial parents are contributing an average of 10% of what they earn on a daily basis to their retirement money. As for the Generation X parents, they are contributing an average of 8%. Baby boomer parents, on the other hand, were contributing an average of 5% of their income to retirement. The respondents of the survey question were all employed, which means that the retired baby boomers didn’t skew the contribution rate of the generation.

The survey, conducted by Harris Poll of NerdWallet, inquired more than 2,000 adults living in the United States. Among the people who participated, 1,112 of them were parents and about 870 non-parents. All of them were asked regarding their habits on retirement savings. The habits that stood out the most were from millennial parents. Despite being too early in their careers as well as having lower incomes, they are saving a large portion for future use.

The Financial Secrets of Millennial Parents



There are specific ways millennial parents use to get their financial houses in order. Let’s take a look at some of them below:


Getting a Grip

Millennial parents know that it’s impossible to map the path to retirement if you have no idea on how close you already are. Money-savvy people track their expenses, assess the value of their current investments such as vehicles and home equity, and calculate their net worth. Lots of millennial parents are making use of retirement calculators that model their cash flows. They allow you to see the amount that’s coming in and out. They’ll also reveal the likelihood of money to run out.


Eliminating Expenses

This is a fairly simple investment strategy of millennial parents: careful tracking of finances. If possible, you have to ruthlessly eliminate unnecessary expenses for you to be able to save as much money for retirement.

Anything that you commit to that is a regular expense, and you’ll need 300 times the amount saved in order for you to fund the same amount of money in retirement. The number one expense that you must focus on ditching is your mortgage. If it’s a $250,000 mortgage and you clear an extra $300 monthly, then you will be able to shave off a full decade of payments.


Income Diversification

Diversifying retirement investments is essential and that includes having multiple streams of revenue. If you have the time to learn how to trade and you have always been curious on the subject, you can open an account at CMC Markets. If you master the skill, you’ll be able to have a predictable and consistent cash flow. We also advocate “income investing” as it provides retirees with cash flow that’s generated from interest on bonds, stock dividends, and REITs.


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Hey! I'm Kacie, wife and mother of 3. I write about my family's finance: how we save money, improve our spending, and plan for the future.

I hope I can inspire and encourage you to improve your situation. See disclosure.

I'm adopting a much slower-paced posting schedule, and treating this as a hobby blog now.

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