#thebrightyellowofficefinance

[thebrightyellowoffice]

That one time I spent over $5k on nothing

Back in my naive days, I thought I was too good for community college and college in general. I moved into my first apartment, feeling like a badass young kid and dropped out of community college just to apply back into what I believed was a “better” college. I was so blinded about what “good” this school could do for me. I didn’t realize that this school has almost no credibility. 

I attended this school for 1.5 years just to, yes, drop out again. When I decided to go back to my first community college the next year, NONE of my credits transferred. Nothing. Zero. Zip. Ziltch. It was like I never went to this stupid school at all. Now, 1.5 years doesn’t seem long. Until you have felt what it’s like to wake up early every day for 1.5 years and work hard, for absolutely nothing. “Frustrating” is an understatement. I felt so broken, where I almost felt like I didn’t even want to finish school. 

The silver-lining in all of this was that I had enough scholarships and grants to pay for most of this stupid school. But I still had to take out a loan for over $5,000. I understand that there is most of America who have over $100k in school loans. But I literally just spent $5,000+ on nothing. Believe it or not, it actually feels worse than if I were to give $5k away to some random person. 

I sucked it up and took my fate as it was. Yeah, I was upset and disappointed. But I knew that dwelling on feeling bad for myself wouldn’t do me any good. So I paid off $20 here and there when I could until I was able to afford to pay a couple hundred dollars at a time. The great thing about this loan was that I didn’t have to officially start making re-payments on it until I was done with school in general. I paid off the unsubsidized loan first because it accrues interest from the minute you take the loan out. The subsidized loan accrues interest once I’m out of school and repayment beings. There was no way in hell I was giving another cent more to this loan. 

After this naive mistake, today is officially the day I have repaid the entire loan completely. I didn’t have to make payments on this loan until 2019, which would’ve estimated my repayment date to end in 2025. And every single penny is paid off before any payments were due. It’s done and over with. It’s officially in the past, in the books, and never to be worried about again. 

Disciplining yourself to do something you just do not want to do, is all mental. Because you’re not doing it for anyone else except yourself. I could’ve waited until 2019 but I was looking out for my future self. You wouldn’t want to put any burden on your family/friends, so don’t do it yourself. You owe it to yourself to pay yourself first!! 

[thebrightyellowoffice]

The Millennial’s Guide to Retirement

Ok so you’re probably somewhere in your 20′s. Time to think about retiring! lol but seriously. It’s tedious to prepare and put money aside for something that will not happen for 20 plus years. The future you will THANK you, trust me. I’m a planner personality. I need a plan to start planning - yeah, that kind of gal. I just like the reassurance. I have this long end goal to retire by the time I am 45 years old. And it will happen. Personally I think we all should be able to retire at an earlier age. Retire doesn’t necessarily mean “stop working and sit on the the porch eating pastries off your Mackenzie Child china every day.” To me, Retirement means I am able to stop working for strictly the means of surviving. After my “retirement,” I plan on fulfilling my lifelong dream of building homes and taking on some bogus corporate job with a ton of benefits. Because ya know, I can’t JUST have one job. lol This is what I call “double dipping” in life. Where I have had already worked hard; blood, sweat, tears, and worries to maintain and build a life. And now in my later years, am able to take the reins on my life in almost every aspect. (excluding the acts of God, of course :)  ________________________

What the heck is a 401(k) ?!?!? 

Having money sitting aside is one way of saving for retirement. But that’s the evil of it - it’s just “sitting.” Wouldn’t you rather have it DO something? For a while I couldn’t get my mind to fathom this amount of money I’ve saved up to just disappear. Visually, that is. The fact that this money is no longer visible in my account where I can see and know that it’s there. But if this money was set aside to begin with, then you do not need it to survive. This is the money that you set aside and are still able to pay your expenses and yourself every month. 

So let’s start with a 401(k) - This is employer based. Where you take a percentage of your pay every period and invest it into your 401(k) account your employer has set up for you. I highly recommend, if you can, contributing the maximum amount your employer is willing to match you. Usually, you’ll want to contribute 5% yourself. Your employer will match the max, of 4%.  Example: Say your paycheck is $1000/week.  5% = $50/week 4% Employer match = $40 _________ 401(k) = $90/week for as long as you’re employed with them

The great thing about this is you don’t have to do anything else. This deduction is automatically taken out every pay period. AND! There are no taxes until you withdraw from your 401(k). (This is a great thing, trust me) 

Along with a 401(k), I personally have another type of retirement investment as well. For some of us who have not begun a career just yet that offers a retirement contribution, you can still start investing. For me, the best product was mutual funds. Everyone is different depending on how much you can invest into your retirement at this time. You should talk to a financial advisor to see which financial products are best for your budget. Start educating yourself on the market and trying to accumulate steady gains. Because remember, sitting money is doing nothing. You want to make your dollar work for you. 

______________________ Okay so what if you live paycheck by paycheck and are just not able to set aside any extra cash you may have? That’s okay! Don’t ever feel like you’re behind because you are not at that point in your life just yet. Everyone has their own pace of life. Start little as $1 a day. Yes, you have a dollar to spare. Mindlessly this all adds up. I have a blog post on how I budget my finances. I know exactly what comes in and out. And if you just “don’t wanna” start saving yet, then honestly, you are not mature enough to even begin thinking about retirement. There is no age limit, just mind set. Mentally if you’re not there, don’t do it. Don’t force yourself because you feel you are “supposed” to. The only right time to start saving for retirement, is as soon as YOU can.  Link to my budget post: http://thebrightyellowoffice.tumblr.com/post/138160062249/budgeting

[thebrightyellowoffice]

Creating your 5 year plan

It’s important to have a projecting plan of your life for the next 5 years, at the very least. It’s understandable that life changes all the time and that a “plan” will have to adjust accordingly. But it’s about creating that general idea of what you want your life to be like in the future. 

I use to want to be all kinds of things when I “grew up.” But I knew that I wanted to be something in the business field. I didn’t know when or where I would have ended up, thinking about this years ago. I didn’t even realize I would find it at a young age either, but very grateful that I did.  

It’s crucial to realize that it is okay to change your mind. Students every semester change their majors. I personally find it very helpful to set daily goals, monthly goals, and long term goals. Standards you set for yourself to achieve, because you truly believe you are great enough to do what it takes to get to your goals. If you know you will not be able to do a certain task to reach your goal, Don’t get yourself up for failure. Adjust accordingly. 

Remind yourself of your own promises to you and take action on your word.  You owe it to yourself. 

Remove unnecessary distractions in your life, like negative people/things. Know that you do not need that burden on your already stressful life. All you can do is simply feel pity for those who can not seek happiness like you are trying to do. 

Stop feeling bad about your issues and things that aren’t helping you to achieve your goals. Take responsibility, accept it, and do something about it. Externalizing your dilemmas will only cycle you in a never ending circle. 

Visualize. For me, I am a visual and hands on learner. I carry 4 different planners that help me organize my life and goals. If it helps, write down your ideas and things you want to get done today, tomorrow and this week. 

I constantly talk about building a happier lifestyle. It’s very cliche but it works if you commit to it. It took me years to realize that I have complete control over how I want my lifestyle to be. I wish I noticed sooner but it’s better than later. You’re cheating yourself when you forget about the standards you have set for yourself. 

[thebrightyellowoffice]

Make your Credit Card work for YOU

Nobody in their right mind likes the idea of being in debt. Owing someone anything is never a good feeling. I have always been a person who was against credit cards. But I recently found out a way to optimize the most out of my credit card to benefit me. 

Do your research Nerdwallet.com is a great site that I recommend to look into credit cards that fit your needs best. For me, it was travel and cash back.  I chose a card that gave me points/per dollar spent and that granted me bonus points for monies spent on travel and dining. Again, the needs vary from person to person. The points with this certain card can be used to book more trips at discounted prices that include trip insurance! Also, make sure you look for the annual bonuses. For my card, if I spent $4000.00 in the first 3 months, I was granted $500 bonus money/ 50,000 points. Which I most likely will use to book my big trip in June. There are some cards that will give you points to use at certain hotels and airlines. For me, it wasn’t the best option to limit myself to one hotel brand/airline because I try to look for the best flight fare at the time of travel. But if you, let’s say, use Marriot often, then it would be a great idea to look into a Marriot rewards card. You might as well get points for the companies you already use so you can earn free nights/discounted rooms.

Do not spend the money you do not have I find that most people who get stuck in credit card debt are the ones who think their credit card limit is “free money.” Remember, you are borrowing a bank’s money. It will never be your money. For every transaction I use my credit card for, I transfer money into the card from my checking account. Depending on the rate you spend/use your card, you might want to set an automatic payment withdrawal. There is some leisure with spending more money than you normally do because you can put it on your credit card. Of course, it comes with payments. Please do not get carried away with this! Do not give the banks more money than they are already making off of us! 

Maintain your credit score The ugly reality is that this economic world is not friendly for us millennials. Most of us have school debt and the ratio from debt to income won’t favor us. For a while, my credit was very scarce. I personally do not have a large amount of school debt, fortunately. I use creditkarma.com to keep track of an idea of my credit score. I found that it does not give me my real credit score, but something very close. The site also has a list of your open/closed accounts and the inquires you’ve had. I check my score at least once a week. 

The best time your credit score is the highest You’ll eventually get the hang of maintaining your credit score and you’ll see what times your credit score is the highest. Your credit score can change in a matter of a week after you have paid off your credit cards. One factor that falls into your score is how much you use your credit cards. Let’s say you have a credit limit of $500 on the one card you have. If you have just made a payment on it and now have a balance of $30 on your $500 card, you have used %6 of your credit limit. The lower, the better your score at that time. This is a good time to get percentage rates for a car loan, for example. 

If you have any questions, feel free to contact me via ask or email; [email protected]

[thebrightyellowoffice]

Budgeting

(January 27th, 2016)

We can all agree that it is probably a good idea to always have a plan. It can be as simple as just having an idea of what’s going to happen/what you plan to happen. I have been budgeting my income and expenses since I started working when I was 16. For those of you who work out or have fitness goals, it’s similar. You make note of the muscles you worked that day and how many times you went to the gym. Your progression is very clear to see when it’s written down. And it helps with motivation and a little “pat on the back” moment when you can see how well you did compared to the previous years. 

Here’s an example of a similar budgeting plan I use:

You estimate what your budget its (your goals/your current). This comes with time and knowing how your finances work. Seeing what you have excess after paying all of your bills for the month. 

This allows you to track what months were over your goals/budget, and what months you fell behind. I like to keep track of it on a monthly basis as well as weekly. I find this is the best way to see an overall view. Rule of thumb, your expenses should be around the same amount as a week and a half of pay. 

This budget especially works for those who work at jobs with a different pay each week/shift. (Restaurants, bars, sales, commissions) Most tipped employees do not keep track of how much they take home and are owed! How could you possibly know if everything is correct if you do not keep track yourself? Your employer is not responsible for that. 

I personally work in all of the above. So I have a separate budgeting plan to keep track of my commissions for one job and tips for the other. 

Keeping a weekly track of your budget is also very helpful. On my excel document for budgeting, I have a weekly plan that is automatically calculated into my monthly budget plan.  

This does require some knowledge of how excel formulas work for this application. If you need help or have any questions, feel free to contact me.

[thebrightyellowoffice]

The right time to invest is NOW.

(January 26th, 2016) 

“Investing is for when you get older” Okay... Well when do you “get older” ? 

Your early twenties is THE time to start investing into mutual funds and Roth IRA’s, retirement plans, etc. AKA, today! Let’s say you get a little bit of refund from your school loans/financial aid or you come across a little more than you have. Any set of monies that is “extra” is the money you should be using to invest or at least save to invest bigger. If you can live by daily with the current balance in your regular checking account, then the extra money is everything else that comes in supplementary to that amount.  I mean, yeah, it’s nice to see your bank balance grow. But it’s going to be sitting in the bank account anyways.

If you have questions you really should talk to a financial planner. You’re never too young to start saving.  Before I was even in my 20′s, I already contributed to a life insurance policy. Because I do not have a family right now, my current beneficiaries are my two little sisters. The best rate you can get is when you’re your healthiest. (RIGHT NOW)  And there are different life insurance policies. There’s a fit for everyone’s situation. I have a whole life policy where mine accumulates money as long as I live just in case I want to use that money later on and don’t die lol. 

[thebrightyellowoffice]

You can afford more than you think.

(January 25th, 2016) 

Bills. On top of bills. On top of never. ending. list. of bills. Growing up sounded so much more fun when I was a teeny-bopper. Right?! We’re talking about the fun things, like rent, groceries, gas, car insurance, car payments, electric, and saving money to do the things you enjoy. There’s no secret about it. It’s a lot of money! Most millennials struggle to make ends meet.  But why struggle? It’s so simple and easy to create a financial plan. 

If you’re living paycheck by paycheck, you need to reevaluate your priorities. Especially if you live at HOME with mom and dad still! Consider yourself very lucky but too stupid to realize it. Living at home cuts almost half of your expenses than the average Joe. That time is the time you should be using to SAVE!! Put away at least some money each week. My friends, it’s called WILL POWER! You don’t need to eat out every other day. Or grab that cup of Dunkin’ Donuts on your way to work/class. Let’s be real here, we all took math for at least 4 years of highschool. $3 a cup each morning X 6 days a week = we’re talking $72/month. That’s $864/year!!! And don’t forget about the other “little” things we tell ourselves we “MUST” have. It’s so simple to save, I will just not get how millennials who still LIVE AT HOME live paycheck by paycheck. Makes no fucking sense. Don’t be an idiot. You’re old enough to have will power.