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May 17, 2017, 1:28 pm

Why You Should Have a Digital Wallet

by: The Financial Blogger    Category: Personal Finance

One of my first jobs was to work in a store as a cashier, among other tasks. Back then – and that is not too long ago – I’d wait for the clients to take their wallet out, calculate their spare change and finally pay their goods. I must admit that during a busy day, I was getting impatient by all this process.

Things surely evolved since then. In a small decade, social medias exploded and smartphones hit the market big time! Many people tend to react negatively to technological changes. However, there are many advantages to turn your old leather wallet into a digital one!

 

What is a Digital Wallet?

A digital wallet is an electronic device, usually used with a computer or a smartphone, that allows one to make electronic transactions. Traditional bank account or credit card can be linked to an e-wallet. Other credentials could be included depending on the service: driver’s license, health card, ID documents and even bus pass, concert tickets and gift cards!

A digital wallet can be a good thing for your online purchases but also for items bought in-store. In fact, more and more businesses, including merchants, now rely on a digital wallet company for their in-store transactions. Some stores will even have their fidelity program provided by the help of a digital wallet service company.

Through the app in your smartphone, simply tap your phone on the register or enter your pin and all is quickly paid for. Such service provides fraud protection for the merchants and enables them to improve their customer experience in terms of payment processing.

There are many examples of such companies. Paypal probably is the most well-known for the average man in the street. Google Wallet also has its fans because of the Google brand itself. Another good alternative for merchants and customers is Paysafe as they are known for their easy to use digital wallets. But truly, the list goes on and you could find the one that answers best your needs within a few minutes.

Should you be a business owner, digital wallets could be a game changer as well!

 

The Advantages

 

Theft

Because your digital wallet does not include physical cards and personal information, it is easier to stay safe. Used with a locked and secured smartphone, it is a lot more complicated for a theft to get to your money. At the very least, it gives you more time than before to react and cancel your credit card.

 

Simplify Your Finances

Because we almost never go out without our phone anymore, it becomes very easy to use it for every payment. That way, you can quickly track your expenses at the end of the month and become more dedicated to your financial goals.

If you can link your bank account, gifts cards, credit card and other financial tools to your e-wallet, you can see at a glance where you’re at and everything applies automatically.

 

Save Time

Do I really have to explain that one? It does take a little time to set, but once done it saves time before your purchase, during, and after.

 

Main Concerns

The two main concerns about having a digital wallet are: security and expenses explosion!

In fact, experts agree that security on digital is higher than traditional methods. However, one has to be careful to use proper passwords and lock its smartphone for better results.

As for expenses explosion, it becomes very easy to spend within seconds and allow people to express their impulsive spending side, which is not necessarily a good thing. Used properly though, digital wallet can save you some!

 

Do you use such service? What do you think about it?

 

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February 22, 2017, 9:41 am

Why Saving For Retirement Is The Most Sensible Choice

by: The Financial Blogger    Category: Personal Finance,RRSP

Saving for your retirement presents both a mental and financial struggle. It is notoriously difficult to start saving and we easily find ourselves making excuses. In fact, you may find that you are trapped in a self-fulfilling belief: “I believe it’s true, therefore is must be true”. Your first and most difficult hurdle to overcome is confronting your mental barrier to saving for retirement.

Understanding why saving for retirement is important will help you take the first step to making the future a priority. You may not be able to start saving immediately, but the steps you take now to mentally prepare yourself will only benefit you in the future when it becomes easier to save.

 

Don’t get caught up living in the moment

Living for today may appeal to the romantics, but the reality is that they tend to rely on handouts from friends, family and/or the government. It is useful to visualize asking your partner, parents or the bank for money. How do you feel? Dread? Fear? Living in the moment means having to feel that way every month just to keep afloat.

That doesn’t mean you should just abandon you current needs and desires. Life is all about balance so try and weigh your future and present needs against each other. You do, after all, have to look after yourself.

 

Having enough money to save

Sometimes you may not have the money to allocate to retirement savings, but many people aren’t budgeting at all. Reviewing your monthly expenditure and setting up a budget often reveals wasteful spending. You may find that you do have some extra cash that could be used more wisely. You may also find that you still can’t start saving. Don’t despair – your budget will help you see the reality of your financial situation and help you plan towards starting your retirement savings. In fact, you can start for just $50/month. That’s the cost of a pair of shoes, a dinner or that satellite TV subscription.

 

Taking care of family members

It’s easy and essential to prioritize taking care of your family now, but thinking about the future is just as important. If you don’t take care of yourself then who will take care of them? Many find themselves stuck between their children and parent’s needs. For those of us stuck in the middle, considering and planning for our own futures will help us to break free from the cycle – to avoid depending on our children when it comes our turn to retire.

 

What about company schemes?

Maybe you don’t trust company schemes and you don’t have to. There are currently several financial products available, which means you don’t have to rely on your employer to manage your retirement savings plan. You can manage your own savings plan with unit trust-linked retirement annuities. You are able to choose the unit trusts that align with your goals, you can start and stop as your financial situation changes.

Being part of a group retirement annuity (which employers typically take out on behalf of their staff) doesn’t mean your employer owns it. They only facilitate the payments, while you are the ultimate owner of your individual annuity and you are able to continue your plan if you resign.

 

Investment managers and your retirement savings

Your retirement savings do not form part of your investment manager’s assets and are held in a trust, remaining safe even if your manager goes out of business. A board of trustees also oversees retirement funds. The trustees’ duties include ensuring that the retirement fund acts in the best interest of its members.

 

But how much work is it?

Starting a retirement annuity is similar to opening a bank account. In fact, you can open your own annuity in just a few steps and easily manage your account online.

 

Finding a place to start

All of this may seem daunting, but like most things in life its only until you get into it. If you are unsure then consult an independent financial advisor to help you formulate a plan that works for you.

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February 1, 2017, 10:46 am

Take Advantage of Credit Card Reward Programs

by: The Financial Blogger    Category: Credit Rating & Credit Bureau,Personal Finance

Credit card reward programs are not only convenient, but also allow you to earn some major bonuses like travel, merchandise, and even free cash. If you learn to be smart with your cards and take advantage of the many reward programs available, you can be looking at a big payoff.

Figuring out how to use credit card reward programs can be confusing, so it’s worth your while to check out the different types of reward programs and how you can benefit from them. Look through these tips on how you can profit from your credit card rewards.

  1. Match Your Credit Card to Your Spending Style

There are all sorts of rewards programs out there that allow you to accrue points towards merchandise, gift cards, travel miles, points, and even cold hard cash. By aligning your your reward program with your interests and goals, you will get the most out of your credit card.

If you like to travel, you need to be using an airline miles reward card. If you regularly charge things like gas and groceries, look for a credit card that offers cash back for everyday purchases. Be careful and don’t pick a rewards program that you aren’t likely to use. You spend money everyday, so why not get a little something back every time you make a purchase.

  1. Use Multiple Cards

If you want to get really fancy and optimize all sorts of rewards programs, you should use multiple credit cards for different purchases. Some cards are better suited for certain expenditures, such as the Chase Sapphire card for home insurance payments or the Express Blue Cash card for groceries. The end goal is to maximize the potential rewards with every purchase made.

Many money experts will tell you that having lots of credit cards can be problematic. The real problem isn’t the credit cards; it’s the spender who can’t pay off their balances in full each month resulting in fees and interest charges. I recommend this multiple credit card strategy only if you are a responsible money manager and consistently pay off your balances.

  1. When in Doubt, Choose Cash Back

Cash back rewards give you money to use for whatever you want. Obviously, this is a great option for everyone—who doesn’t like cash back? In fact, cash back rewards are nearly three times more popular than airline rewards or hotel rewards programs, according to CreditCards.com.

The beauty of this option is that you can apply your rewarded cash to anything, including your outstanding balance. So if you can’t decide what credit card reward program to sign up for, start out with a cash back reward card. You really can’t go wrong with getting cash for spending cash.

  1. Read the Fine Print

Make sure you read the fine print when signing up for a rewards card, otherwise you may end up costing yourself money. You’ll want to look for fees, annual percentage rate, and promotional rate terms. If you don’t understand the terms to which you are agreeing, you could be in for a nasty surprise when the promotional period ends.

Also, credit card companies are notorious for changing these terms. They will notify you, but chances are you won’t see the tiny notification they provide in the dense snail mail notice. Keep your eyes open for any notices from your issuer to make sure your reward program does not make any detrimental changes to your rewards program.

Reward points can expire, so make sure you read through the fine print to know that expiration date. Typically, expiration is 12 to 18 months, but it’s always a good idea to know for sure in order to fully profit from the program.

If you learn to manage responsibly and match your credit card to your spending style, you will benefit greatly from the rewards program.

 

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September 7, 2016, 2:03 pm

Balancing Competing Financial Demands

by: The Financial Blogger    Category: Personal Finance

There is barely ever a time when there are not competing calls on family finances. Recent graduates may well have student loans to repay and perhaps credit card balances that have been created to help subsidize student life. In the following years there may be real estate costs, auto loans then the costs of a growing family. As the children grow attention inevitably turns to education, potentially further education that is becoming increasingly costly, well above the rate of inflation.

All the while there is the issue of parents’ retirement with time running out the later those plans are initiated.

Financial Dilemmas

 

The dilemma becomes the extent parents can help towards further education costs as well as making a proper level of contribution to their retirement fund. The problem is that both demands are fairly immediate. Even parents fifteen years from retirement know that time is tight. Compound interest is a major ally to those saving for retirement but it must be given time to work.  A recent report by E TRADE suggests that as many as a third of Americans regard the competing education and retirement demands as the most difficult they face.

While it may be a difficult decision to make retirement should be the top priority in virtually all cases. A different study by T. Rowe Price reveals that a similar amount of people, a third, have in fact taken a risk and borrowed from their 401(k) to help with children’s education. While the interest rate is relatively low if for some reason, typically redundancy, something unexpected happens, the full amount of the current fast loan balance becomes due in 60 days. In addition growth is lost on the sum withdrawn.

People who were questioned in both these studies had fairly similar recommendations. Over three quarters said they would advise younger people to start saving earlier; as soon as possible after beginning work. Indeed there is a product that allows children to start to save for themselves. Children who are taught the value of money are most likely to have their affairs in good shape throughout their lives. For example if a child is asked to do a little chore in exchange for an allowance that is a good starting point. Perhaps encourage a child to save part of the allowance against the cost of something they want to buy? These little lessons help.

Modern Day Realities

 

Where things go wrong it is important to take action. It is easy to build up credit card debt for example. It is costly because credit card companies make their money on the high rate of interest they apply to month end balances. Personal loans are much cheaper and should be used to eliminate such balances to ultimately release more money to put to more positive use.

A tax expert is useful. There are several things to look at when you make decisions on education costs and retirement provisions. Whenever you make a decision of any kind it is important to have all the information relevant in making a good decision. In the case of finance that means any tax benefits for one course of action over another.

The Value of a Student Loan

 

You might be surprised by the size of some student loans; there are a significant number at $100,000 and plenty at $20,000 at least. It is quite a daunting prospect starting a career needing to pay back such a debt. It is clearly something that concerns most parents who want to help as much as they can. A figure not far short of half actually admit to the fact that they now believe that the qualifications they received have not been worth the ‘’burden’’ they now have around their necks.

It is difficult to decide one way or another whether they are right or just expressing frustration. However what is certain is that all young people have much longer to get their financial affairs in place than parents who have to prepare for retirement with minimal help from elsewhere. Good financial management is not a subject youngster will be studying but the sooner they learn it the better their own future prospects.

 

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August 25, 2016, 8:11 am

Three Expenses You May Be Forgetting to Budget

by: The Financial Blogger    Category: Personal Finance

 
Learning to make and stick to a budget is one of the most important duties of adulthood. A well-kept budget is the key to financial stability, but a few too many mistakes in your calculations can send you reeling. One of the most common budget mistakes is forgetting to plan for financial obligations that occur less than once a month. Just when you get excited about having a little extra money to spend, you get an unexpected bill in the mail, and there goes your extra cash.
To avoid finding yourself in this situation, sketch out a rough budget several months in advance that includes these less-than monthly expenses. You do not have to be very detailed, but it is helpful to at least have some notes in your planner or spreadsheet. Some common expenses to watch for are detailed below.

  1. Insurance Costs

If you own a home and/or a car, then you need to have them insured. Payment amounts and schedules vary wildly depending on your property, provider and plan. Be sure to go over the specifics of your policies so that you know when you are responsible for making payments and how much those payments will be.
For example, homeowner’s insurance is often, but not always, paid with the escrow portion of your monthly mortgage payments. Car insurance is sometimes billed for six months of coverage at a time, but in other situations, it is billed monthly. Failing to make your payments can result in hefty fines, so it is critical that you stay on top of them. Discussing your policy with an insurance agent can help you get the best prices for your situation.

  1. Upgrade Costs

Most cell phone service providers offer their subscribers free upgrades approximately every two years. It is always fun to pick out a pristine new phone and play around with its special features. What’s not so fun is receiving a higher-than-usual bill later that month. The fact is, even if your new phone is free in the store, there is often an associated service charge that is only mentioned in the fine print. Next time you are due for an upgrade, double-check the terms of your plan so that you are not blindsided by hidden costs.

  1. Vehicle Registration

One of the most irritating budgetary surprises is vehicle registration renewal fees. How often you must pay these fees depends on where you live. For example, Washington vehicle owners must renew their vehicle registrations once a year. You should get advance notice of the fees you owe, but they can still be shocking if you had not planned for them, especially if you have multiple vehicles. The cost of your registration fees will depend upon your vehicles’ specific characteristics. It is also worth noting that some states allow you to renew your registration several months in advance.
No Surprises, No Sweat
If you want to stick to your budget, then you must eliminate the possibility that you will have to deal with surprise expenses. Budgeting is a skill that can take years to master, and it is normal to experience a few hiccups along the way. Don’t worry, though—by planning in advance and remaining diligent, you will eventually experience the freedom that comes with financial security.

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