September 9, 2020, 10:44 am

10 Things to Do During a Sudden Cash Shortfall

by: The Financial Blogger    Category: Personal Finance

If the past six months have taught us anything, it’s that we can’t always rely on the income we usually receive. Even when a global pandemic isn’t smothering the economy and resulting in massive job loss, we’re vulnerable to layoffs, sudden business downturns, and factors that could reduce or eliminate our income streams. That’s an unquestionable fact of life in the current economy.

What can you do about this? When you suffer a sudden reduction in your income, how can you keep yourself afloat? The answer isn’t simple or easy, but you can take action. Here are 10 critical steps.

Image par Tumisu de Pixabay

10 Things to Do When the Money Isn’t There

1. Stop Digging

There’s an old saying: “If you find yourself at the bottom of a hole, the first thing to do is stop digging.” This is true and essential for financial holes. The second you learn your income will be cut, cancel plans to spend extra money.

Shopping is a typical way of dealing with stress. It may feel good in the moment, but it will make every problem from your cash shortfall worse in the long term. Do what it takes to stop unnecessary spending in its tracks until you have things under control.

2. Run the Numbers

Sit down and find out how bad things are. Go through your past few months of bank statements, and look at your calendar for upcoming irregular expenses like a child’s birthday, a doctor’s visit, or scheduled maintenance for your car.

Whether or not you usually stick to a budget in your regular financial life, it’s essential to know as accurately as possible how much money you have to spend in the coming weeks and months. While going through this process, note habitual spending that’s necessary and what you can do without for a while.

This process tells you exactly how much trouble you’re in and can help you form a plan to get yourself back on track.

3. Review Terms

Review the payment terms and late payment policies for your regular bills, like utilities, rental storage, car insurance, and your mortgage. Use this to prioritize payments if your shortfall is massive enough that you can’t pay all your bills in a given month.

For example, say your garbage company has a hefty penalty on 10-day late fees. However, your electric and water bills have no fees until you’re 90 days late. In this case, you should pay your garbage on time monthly while staying a bit looser with your electric and water payments.

Of course, you ideally want to pay all your bills on time every time. But this research will help you make the smartest possible decisions if that proves impossible.

4. Cancel Subscriptions

Subscription services like premium sports channels, box deliveries, and print magazines tend to be a sort of sleeper cell in your finances. They don’t cost much, and you’re used to them slowly bleeding your finances, so you don’t really notice them. In good times, this isn’t necessarily a problem, but when you’re struggling to make ends meet, reducing these expenses can make a big difference.

Review your statements for recurring charges, and ask yourself how vital each one is to your happiness. There’s nothing wrong with keeping that sports channel if you watch it with glee every week. But that membership to the gym you never visit, or the subscription box shoes you rarely wear, should go.

5. Find Extra Cash

For short-term financial hits (like a week without work or a tax bill), this might mean finding spare cash in a savings account or going through coat pockets and couch cushions. It can also mean selling used books or old sports equipment. Whatever it takes to make up for the temporary shortfall and keep things moving forward.

For a longer-term problem (getting laid off or a major economic downturn), you need to find extra ways to earn cash. This could be a side hustle, a regular part-time job, some kind of passive income project, or whatever else you can find. The point is to create a regular stream of extra funds however you can.

It pays to get creative. Look at your resources, both physical and mental, and brainstorm how to turn them into the cash you need. Who knows? You may find an option you like better than your current solution.

Warning!

Under no circumstances should you even consider using a payday loan outfit to provide this extra cash. Their interest rates are extremely high, and you risk getting trapped in a spiral of paying fees every month moving forward. This makes your financial situation much worse when you should be taking steps to make it better.

6. Call Around

Once you learn you will experience a budget shortfall, call the vendors you’ll owe money to in the coming months. Find out how flexible they can be with due dates, late fees, finance charges, and even pricing. You might find that a company — especially one you’ve done business with for a long time — will offer you deals to keep you happy when you’re having trouble. Many companies that won’t offer a discount will still put your account on hold so you don’t have to pay or incur new charges until you’re back on your feet.

During these calls, ask for the representative to email you any offer made in writing. That way, you have a reference to look back on later and proof of the offer if you talk to a new person when you take advantage of the offer.

7. Hold a Fundraising Event

A one-time cash infusion can help in any budget shortfall. Consider holding a garage sale, crowdfunding event, or training course related to what you do for a living. As with finding extra cash, get creative. Think of how to make a few hundred, or a few thousand, dollars with your energy one-shot expenditure.

For short-term problems, this might be all you need to get by. You could even experience one of the best months of your financial life so far. In a longer-lasting financial dilemma, aim to earn enough money to help a little for several weeks or months to come.

8. Identify the Silver Lining

We’re not telling you to be cheerful about financial stress. However, most causes of an income shortfall also come with opportunities. For example, getting laid off can mean lowered expenses from gas, work clothes, and eating out.

Look hard at what caused your income shortfall. Find the ways it can save you money or create opportunities to earn income in other ways. Leverage these small advantages to help you make it through this lean time, and even to refocus your priorities once your income stabilizes. 

9. Cut Corners

Go back through your statements and look for every way you can reduce any given bill by 5% to 10%. Some common opportunities include:

  • Reduce utility bills with simple changes in your habits
  • Cook large, inexpensive meals and eat leftovers instead of dining out
  • Downshift your cell phone plan to less data per month
  • Carpool to work to save on gas
  • Opt for a less-expensive plan at a gym, day care, or other service
  • Skip alcoholic drinks when eating out
  • Put premium entertainment options on hold
  • Skip a costly event you go to regularly

The goal isn’t to reduce your life to a joyless experience with only the essentials. Instead, just trim a little fat off everything you do, just long enough to make it through the crisis. When it’s over, consider how much of the fat you can leave off and still be happy.

10. Cure the Disease

Finally, look deeply at the cause of your sudden cash shortfall. In some cases, the cash shortfall is a symptom, not the disease. The disease might be the tenuous position of the career you chose or a lack of financial discipline in your personal finances. It could even be a personality trait or home situation that leads to getting fired frequently.

Be honest with yourself and assess what changes you could make in your situation to prevent the next hiccup in your income. Once you’ve identified what you can do, create and execute a plan for doing it.

Final Thought

If you’re experiencing a sudden cash shortfall right now, the best thing you can do is go through the list above. If you aren’t experiencing a shortfall, there’s an important step you can take right now to help yourself in the future: start your emergency fund.

Do whatever it takes to get $500, then $1,000, then one month’s worth of expenses saved in an easily accessible account. That way, if you suffer a cash shortfall in the future, you can borrow money from yourself and keep moving forward.

Sean Picket is a financial journalist in Florida. Over the years, he’s used many of these strategies himself to contend with financial rough spots.

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September 1, 2020, 8:08 am

5 Ways to Make More Money in Your Current Job

by: The Financial Blogger    Category: Career,Personal Finance,Uncategorized

There aren’t many people who can say they would turn down more money if it was offered to them, especially if it meant they could stay in their current jobs and save themselves the trouble of searching for something new and having to start all over again. However, the problem that many people face is that they just don’t know how to do both; they don’t know how to keep their current jobs and get more out of it. After all, if they continue doing what they are doing, why would they be able to get more money for it? If nothing has changed, why should their salary increase?

In reality, there are many reasons why this might be the case, and if you can find out what those reasons might be and take the time to really work on them, you may well be able to make more money doing the same thing you’re doing now. Read on to find out how.

Ask for a Raise

The simplest way to make more money in your current job without having to change anything at all is to ask for a raise. Don’t wait until your employer offers you more money, as this might never happen. Instead, make a list of all the reasons why you deserve a raise and call a meeting to give them this information. The reasons could include:

Ideally, you will want to have a specific amount of money in mind to ask for, and this is why research is crucial. Start a little higher than you might realistically be expecting (but not too high) and you can negotiate down to an amount that suits both you and your employer. The worst that can happen is they say no, at which point you can decide whether you want to look for work elsewhere or you’re content to stay where you are on less money than you feel you deserve.

Ask for a Promotion

Something that goes hand in hand with a raise, although isn’t always necessary to achieve the former, is a promotion. If there is an opportunity to rise to the next level in your current job and you want to take it, then that is what you must do. Take a look at your resume and make sure that it includes all the skills you have learned over time, mentioning specific projects where necessary. Your employer should already know about these things, but it is a good idea to remind them, and show them the value they have in you.

Even if there isn’t a specific opening available, you can always tidy up your resume and present it to your employer speculatively. They might realize just how important you are and create a role just for you.

Keep Learning

No matter what career you have or what level you are currently at, there is always going to be more to learn, and this is something that can increase your chances of earning more money. Always be aware of any additional opportunities to improve your education and yourself, and to gain extra qualifications in whatever field you work in. Pediatric acute care nurse practitioner programs are just one example of something you could specialize in if you are already in a nursing field, for example. Or you might want to go back to school part time to obtain your masters, or a PhD.

Anything more than you already have is going to look good on your resume, and your employer should be impressed by your dedication, passion, and knowledge. If they aren’t, these extra qualifications would certainly impress a different employer in your field, so don’t limit yourself; if you want to make more money and you have spent time and effort learning more about your career, sometimes it is necessary to move on to make the most of the knowledge and experience you have.

Build Relationships

If you want to improve your lot in life and make more money in your current job, it’s a good idea to build relationships both in your department, and out of it. You are going to generally need supporters and cheerleaders if you want to make more money and create something exciting out of your career; the more people you know who will be willing to be a reference or put in a good word for you when necessary, the more chances there are of you getting what you want.

This is why you need to make sure you treat everyone, no matter what position they hold, with respect. By building good relationships across the company, there is always going to be at least one person who will stand up for you and fight your cause alongside you when it comes to ensuring you are paid fairly for what you do. Plus, you never know what opportunities being kind and respectful to people right now will open up to you down the road.

Be Indispensable

If you can make yourself totally indispensable through your hard work, your experience, your willingness to help, and your character, you will stand more chance of making more money in your current position; no right thinking employer is going to want to run the risk of losing you to the competition by not offering you more money to ensure you stay where you are.

It won’t take much to ensure that your boss doesn’t want you to leave. Be kind, courteous, helpful, honest, adaptable, and as positive as possible, and this will all help. So too will the additional learning that we mentioned above. Although you don’t want to necessarily take on any extra work to show just how useful you can be, and you certainly don’t want to be taken advantage of, going just far enough is going to be a useful way to make more money in your current job.

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July 15, 2020, 7:01 am

How to put £10,000 in virtual funds to work in a forex demo account

by: The Financial Blogger    Category: Investing Ideas

Trading forex isn’t a game, but it’s surprising how much you can learn about currency markets using monopoly money. 

Signing up for a demo account with a leading forex broker allows you to do just that.  You can pass go and try trading in a live environment straightaway using £10,000 in virtual funds. This key feature of forex brokerage trading services lets novice traders get a feel for what they can expect when real money is on the line. 

What’s great about this option is the freedom to gamble with virtual cash in order to refine your trading skills and prepare for the day when you put your own capital at risk. 

Starting out with £10k will give you enough funds to sustain a valuable trial period. If you’re new to the game and don’t have much prior experience, you can learn the ropes by test driving the demo accounts services and capabilities, most of which reflect what you’ll have access to later when you go live.

Forex demo accounts use actual market data to reflect what happens on a real trading account.  Forex brokerages offer them as a way to attract prospective new customers, by helping them understand how currency markets work.  Potential customers also get to see how the broker’s platform performs, and the range of services available.

Having spent some time making virtual trades on the demo account, you can start to adopt specific trading approaches like day trading and see how they do.  You can also begin to build a trading strategy that reflects your goals. 

The key to making that virtual £10,000 investment payoff is to trade as though the money was real, responding to the actual market conditions and adopting a trader mind-set.

To open a forex demo account and set the £10,000 funding amount, follow these steps:

1- Make a shortlist of forex brokers to try. There’s no shortage of forex brokers to choose from, and any Google search will give you pages of options.  Do some research to work out which ones have the highest satisfaction ratings. Select one or two to try out first.  

2- Use the tutorials and other educational tools. The internet is chock a block with introductory forex courses and DIY guides. The information a demo account broker provides tends to be of high quality and will be geared to their platform’s features and benefits, and they’re free – so it makes sense to take advantage of them. 

3- Configure your account settings. You’ll want to configure your demo account just as you would do with a live account. To keep it real and trade as though actual cash were on the line, restricting yourself to specific pairs, and ensuring each position has stops and other risk management tools turned on.  

Eventually, you’ll be ready to make the leap to live trading and test your skills against the market. To help mark when that day should be, it’s a good idea to set benchmarks. That might mean completing your first 50 trades, reaching 15 per cent of the demo account virtual funds balance, or hitting a full month of profitable trading. 

Maximising the virtual funds in your demo account will make the transition to live that much easier.

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July 10, 2020, 11:39 am

Three Crypto-Market Trading Strategies

by: The Financial Blogger    Category: Personal Finance

When we think about the most well-known use-case for the cryptocurrency and blockchain space we tend to think about things such as cross-border international payments. However, by far the largest use-case for the cryptocurrency space right now is: trading. We all remember Bitcoin’s monumental rise to the $20,000 mark, and this was fuelled by the increasing numbers of traders and volume sizes. Bitcoin’s volatility is great for traders, because it creates trading opportunities that can result in big returns. Navigating the cryptocurrency market first begins with have a solid strategy in place. Here are a few trading strategies that you could be using to gain an edge in the market.

1. Fundamental Analysis

The first trading strategy on this list is fundamental analysis. This strategy is used very often in traditional markets such as stocks and bonds. The idea behind fundamental analysis is to find companies/assets that are undervalued by the market. This is often reflected in the price of the asset with it trading at a lower price point compared to other companies/assets. A trader using fundamental analysis would look to take a long position when an asset is undervalued and then make gains on price appreciation as the market recognises the value of the asset.

Traders will use a number of metrics to help them determine the underlying value of an asset. For example, when finding the underlying value of a company’s stock, the following metrics are often used:

Fundamental analysis and metrics cannot be used in the context of cryptocurrency given the fact that cryptocurrencies such as Bitcoin are a fundamentally different asset class. For example, Bitcoin and Ethereum are not companies that generate cashflow. Despite this however, there are metrics that are being used in the space to help in determining the value of various cryptocurrencies. For example, the following metrics can be used:

2. Swing Trading

The swing trading strategy is well-known and has its origins from the traditional markets of stocks and commodities trading. Swing trading looks to generate returns off the upward or downward price swings of an asset. This strategy is particularly great for the crypto market given its volatility. It’s not unusual to see the price of Bitcoin swing upward or downward by over 20% in the space of a few hours. To use this strategy properly, a trader will need to be able to accurately call when an upward or downward swing is in play, which can be tricky. Swing trading is best executed using an automated set-up. Crypto bots and signal groups (e.g. Binance signals) are good starting points in better executing the swing trading strategy.

3. Arbitrage

Another feature in the cryptocurrency market is the fact that there is often differences in the price of cryptocurrencies such as Bitcoin across cryptocurrency exchanges in the market. For example, the price of Bitcoin might be trading at $10,000 on Binance and $10,100 on BitMEX. The idea behind arbitrage trading is to profit off the price differentials that exist between various cryptocurrency exchanges. You will need to be fast in order to execute this strategy effectively, so an automated set-up might be useful when using this strategy.

Conclusion

Being a trader in the crypto market is exciting, given the huge number of opportunities that exist for traders. Having a solid trading strategy will set you on the right path to consistently and reliably generate returns when trading. These strategies are just a few that you can get started with, but it’s important to find a strategy that works well for your own trading style.

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June 17, 2020, 8:02 am

Dealing with unexpected bills

by: The Financial Blogger    Category: Personal Finance

No matter how diligent you might be when it comes to your finances, the risk of an unexpected bill is ever-present in the background. Perhaps you moved home many years ago and there was an error when settling a cable account but you’ve not received the correspondence. Or maybe you’ve been hit by an unexpected need to replace an essential item, such as a phone or a laptop, following accidental damage that cannot be repaired.

Whatever the root cause of your new-found unexpected bill, it’s vital that you respond to it and make sure it doesn’t morph into a more pressing concern. But how can you do that if you haven’t planned for the expense? This article will share some top tips on how to help tackle a financial curveball as it comes your way.

Reduce your outgoings

The simplest way to open up more cash is to reduce the amount that you’re currently spending. In some cases, this might be simple yet painful. If you now spend a significant amount of cash on eating out or picking up lunch while on the go, for example, you could consider cutting out this luxury and replacing it by taking a meal from home. You could then put the cash you will save towards paying off an unexpected bill.

Depending on your circumstances, however, this could require a more creative approach. If you are already in a situation where your outgoings are extensive, but your income is tight, it may feel like there is no room to deal with an unexpected bill. If you can, it may be worth considering some frugality tips – such as batch cooking meals, splitting dishwasher tablets into two or three to make them last longer, or turning off the heating during colder spells and wearing more clothes instead. Measures like that can seem extreme at first, but often they are what is needed to help tide you over when an unexpected expense occurs.

More time on offer?

Depending on the nature of the bill, it may well be that you can get extra time to pay it off. It’s certainly worth calling up the institution in question if you can and asking them to consider giving you a payment holiday or at least developing a payment plan that can help both parties. After all: it’s in their interests to ensure that customers pay up eventually, and if they have room in their cash flow to allow for this, then they might well permit it. There are no guarantees, but it’s worth trying just in case.

Ask for a raise

In some cases, it makes more sense to look for the money you need to save by working with what you’ve got. And that’s especially true if you’re currently in work and have a paycheck landing in your bank account every week, fortnight or month. Depending on where you work, there might be no obligation for your employer to provide you with a pay rise. But there’s rarely anything to lose by occasionally and politely asking for a raise – and if they say yes, it could well solve your worries about the unexpected new outgoing.

Making money online

Some people also look into making money online, too. It can be a helpful way of raising income if your usual job does not offer much in the way of salary progression, and it can be done flexibly around childcare and other commitments. If you have skills in finance, say, you could look into online trading – although be sure to learn from experienced traders by taking some courses. Alternatively, those with marketing skills could look into flexible work like content creation or copywriting. Whatever you can do, there is likely to be some flexible work that suits you available online – and as a temporary stopgap to deal with that pesky new outgoing, it could make all the difference between financially surviving or going under.

Overall, there are many different options available for somebody who needs to contend with a bill they did not expect. As well as asking your creditor to extend your repayment terms, it’s also possible to focus either on cutting your current spending or increasing your current income. Not all methods work for all people, though – so it’s important to carefully assess your options and ensure that you choose a mode of money management that works for you and for the nature of the unexpected bill you have to pay. 

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