The Rule of 72
The Rule of 72 is a math formula that tells you how long it will take to double your money. You first need to find out the interest rate, then use the Rule of 72 formula. The formula is simple: 72 / interest rate = years to double your money Example: $10,000.00 invested at 8% interest rate 72 / 8 = 9 years --> In 9 years your $10,000 will double to $20,000 at 8% interest. What if you have $100,000 and you need it to grow to $200,000 in 6 years. What interest rate would you need to get?? ...
Do You Really Need Life Insurance?
The question I often get asked is "Do I really need life insurance?" And that answer, of course, depends on you and your situation. The main question I ask clients is "Does anyone depend on your income?" Because life insurance is really designed to replace the income you would have made if you were still living. * Do you have a spouse? * Do you have children? * Do you have aging parents? After you decide whether or not you need life insurance, you need to decide how much you need. And that (AGAIN) depends on you and your preferences. ...
Steps to Good Credit
Good credit is becoming increasingly important as credit markets tighten. While it seems that the smallest mishaps, negatively affect credit, it takes quite a few 'right' moves to increase your credit scores. Below are a few tips to help you get on the GOOD SIDE of credit! 1. Sign up to have your bills automatically paid if possible (especially your debt). There are many bi-weekly programs that are great for not only paying your payments on time, but also can help you get out of debt faster. 2. Pay extra on your bills every month. This is especially useful if you have the ...
What is a Stock Option?
So, you now know what a stock is (ownership in a company). So what the heck is a stock option? Well, I will explain a call option using a real estate example. Let’s say you are trying to sell your house right now for $100,000. I don’t want to buy a house right now, but I think the housing market is going up. I buy THE RIGHT to buy your house in one year for $105,000. ... [Read more of this post]
Best Moves in a Bad Economy
Long term financial strategies are meant to withstand all types of economies. However, during certain market and economic downturns, there are 5 good moves: 1. Build a bigger emergency fund – The amount you need in your emergency fund will depend on you, your expenses, and your situation. Most people should have 3-6 months of expenses saved in a readily accessible account (such... [Read more of this post]
What Is a Stock?
In the simplest form, a stock represents ownership of a company. A company can have as many or as few stock shares as it wants. Large corporations as well as small businesses can have stock. If there are 100 shares of a stock and you own 51 shares, you own 51% of the company. It’s common for small business owners that set up a C corp to own 100% of the stock. For most of us,... [Read more of this post]
