Money - Sahel Rafael Tamayo

June 8, 2019

How to Buy Your First Stock

The stock market is one interesting place. If you have plans to enter it, chances are you are excited at the mere thought of earning some money on the side. Well, this is an actual possibility provided that you are playing all your cards the right way. However, taking the plunge into the world of stocks is not an easy feat, so you need to come fully equipped in every sense of the world.

Keep in mind the following tips on how to buy your first stock to ensure a successful venture.

Do Your Research

Prior to buying any stock, doing your research is the first step that can never be stressed enough. While there are a lot of experts and professionals out there who can give you sound advice, don’t forget that there are those who just claim to be experts whose advice might not really be as reliable. So, if some of your friends give you tip and encourage you to buy simply because this or that company is popular, make sure that you don’t just follow their advice blindly.

Start with Stable Stock from a Reliable Company

Beginners are recommended to start first with stable stock. It is best that you go for a company that has been in the industry for some time then read more about them. You can get some help from financial magazines and even websites. You need to look into the status and performance of the company you are considering as well as the market’s state as a whole. This can come in handy when making your final decision.

It is crucial to choose a stock and company that has been around for some time as it will give you better opportunity for making predictions of how the future will be like. While it may be great to invest in new companies, especially if you consider how people claimed to make lots of profits out of them, there is a considerable risk of ending up losing your money.

This means that although you might not get lots of excitement from a more solid stock, this will give you better peace of mind as you get to learn this and that and make yourself more familiar with the stock trade and finance world. There is so much for you to learn here and the process will take some time.

The process of learning itself is also quite an interesting one. Numerous outside influences affect the stock market, and these include legal affairs. In the past, the market has been affected by the tort system, with large verdicts almost commonplace. It is reason why market analysts always keep an eye out on what happens in courtrooms.

Start Small

Finally, make sure that you start small while learning. Yes, joining the stock market may seem like a gamble as some risks are always involved. There are a lot of uncertainties but you could reduce your financial loss if you do your research and watch out for influences that could affect your stock.

June 8, 2019

How Often Should You Be Investing

One of the biggest fears of most people when they first start investing is that they will make a dumb choice that will prevent them from enjoying the best returns on their investment. They feel anxious and worried about this and that fund, buying bonds, or buying real estate. Their anxieties and worries and indecisions continue to pile up that keeps them from making any investments in the first place.

Well, this is actually a big mistake and for a good reason. A poor choice in investment can take a really long time before it makes any substantial negative impact on your finances. However, it wouldn’t take that long before you notice a negative effect if you choose not to invest at all.

For instance, let’s say that you set aside $100 monthly for retirement. You can choose to put money aside in a randomly chosen investment earning 6% every year or the average or you could study it for 6 months and opt for a better investment with 7% returns per year.

All in all, the main point here is that when you first start to invest, it is much more important for you to start now and try putting away as much as possible as compared to finding that perfect investment.

However, what if you want to invest yet you got several debts piled before you. What should you do then?

It is critical that you always opt for the choice which can offer your dollar with the best long term return.

Thus, the first step you should take is to stop accumulating any new debt. It is important that you avoid incurring any personal debts if you wish to get ahead with your investment.

The second step is for you to set aside some money for retirement that matches that of your employer, assuming that your employer is offering a match. Why is that? This will be an instant return of 50% to 100% on your money. If the employer will match your savings for every dollar, this would instantly double your money. Make sure you grab this first.

After this, you can start paying down those debts with high interest. Usually, it means that you need to pay off things such as credit cards although you need to wait on other things such as house loans or car loans.

Following this, you can now invest in your retirement of a minimum of 10% of your current income or even a minimum of 15% if you feel like you are a bit behind.

Again, investing should be done as early as now. Always go for the best investment that you can find right away then start from there. If you wish to make changes later on, it is easy to do so but making up for the lost time will not be possible.

The secret for investing is to always start now and try contributing as much as you could and use frugality to your own advantage. If you don’t use these two tactics, you might end up finding yourself several years behind where you could have been.

June 8, 2019

How Much Cash Do You Need To Buy Your First Home

Mortgages may cause lots of headaches, but for some people they’re the only route to a new house. However, for some who will buy a house with cash, it can be possible. Having an on hand cash to close deal is frequently a must. Down payment is the hardest to cover since these are around twenty percent of the value of a home. Therefore, if you are gearing up to purchase a home anytime soon, it is a great idea to determine what types of cash reserves are needed and what they will be used for.

Consider the Down Payment

You might be one of those who want to take the mortgage route to purchasing a house. The most essential and biggest expense to worry about is the down payment. If you are applying for conventional mortgage, the golden rule is making a down payment of twenty percent of purchase price. For instance, for a house with a price tag of $250,000, you would need to make at least $50,000 down payment.

The requirements for down payment are a bit different if you are applying for a different kind of loan through FHA, USDA or VA loan. You might not have to put money down at all with USDA and VA. FHA loans require a down payment equal to 3.5 percent of purchase price. It’s a good choice for anybody who’s short on cash.

You will require your down payment in separate checking account or savings account. If your family member will give you the money as a gift, it is a great idea to let that sit in your account for several months. It is also essential to have a detailed documentation to show where money came from in case lenders ask for proof that down payment is considered a gift.

Pay for the Closing Costs

The closing costs basically refer to all expenses, which are due when the time you sign final mortgage paperwork. It includes things such as loan origination costs, attorney’s fees, and credit check fees. It isn’t unusual for the closing costs to run anywhere from two percent to five percent of purchase price.

Some Costs You Should Know

Prepaid expenses are basically the costs that might need to be paid out of your pockets prior to the closing. For instance, an appraisal is frequently paid upfront. Your lenders might also need you to pay for your home inspections before loans come to fruition. If you are rolling the property taxes and insurance of homeowner to your mortgage payment, you will also require to have enough money for covering the costs.

No matter what method you use for paying your new home, it is a personal decision. So, ensure you do ample research about which decisions should work best for you. For you to do this accurately, you might like to do deep dive to your finances monthly. This can help you see what type of cash you would require to make mortgage feasible. Never forget to include the outside costs including origination charges, paperwork fees, closing costs, and so on.

May 7, 2019

What is a Private Equity Fund?

A private equity fund is a pool of capital that will be invested in a company that represents a chance for high rate of return. Private equity funds come with fixed investment horizon that typically ranges from 4 to 7 years. At this point, the private equity firm hopes to exit the investment in a profitable manner. These exit strategies include selling the business to a strategic buyer or a different private equity firm and IPOs.

Accredited investors and institutional funds often compose the primary sources of a private equity fund since they can offer significant capital for a longer period of time. There is also a team of experts in investment from a certain private equity firm that raises and manages the funds.

What is Equity?

Equity is further subdivided to four primary components namely ordinary shares, CCPPO shares, preferred shares, and shareholder loans.

The equity proportion typically accounts for 30 to 40 percent of funding in the buyout. A private equity firm tends to invest in equity stake with 4 to 7 years of exit plan. Equity funding sources include private equity funds, management, investment banks, and subordinated debt holders. Most of the time, the equity fraction is composed of a combination of these different sources.

Two Types of Private Equity Funds

In general, a private equity fund falls into two primary categories: leveraged buyout or venture capital and buyout.

Leveraged Buyout (LBO) or Buyout

Leverage buyout funds invest in businesses that are already more mature, often taking the controlling interest. Leveraged buyout funds use large leverage amounts of increase the rate of return. These buyout funds have the tendency to be substantially bigger in size compared to venture capital funds.

Venture Capital (VC)

Venture capital funds refer to pools of capital that often invest in emerging, early stage, and small businesses expected to have high potential of growth but with limited access to some other capital forms. In the viewpoint of small startups that have ambitious innovations and value propositions, venture capital funds are an integral source for raising capital since they don’t have access to bigger amounts of debt. As for the investor’s point of view, even though venture capital funds have some risks from putting investments in an unconfirmed emerging business, they still have the ability to generate some really extraordinary returns.

Common Exit Routes for Private Equity Funds

Once they decide to exit, private equity firms can take any of two paths: partial exit or total exit. In wholesale exit, there could be a trade sale to a different buyer, a share repurchase, or leveraged buyout by a different private equity firm.

In partial exit, a private placement can happen where a different investor buys a part of the business. Corporate restructuring is another possibility in which the external investors can get involved to raise the position they have in the business through partially acquiring the stake of the private equity firm. Corporate venturing may also happen where the management increases business ownership.

May 7, 2019

Top 10 Countries to Retire

If you want to make your money stretch further in your golden years, you might want to consider opting other countries for retirement. But, which country is the best for you? While everybody has an opinion in terms of ideal retirement spot, experts can make the decision making process easy for you. Below are some of the countries you can consider for your retirement:

Panama

Aside from being close to America, Panama also uses American dollar, so you do not need to worry about the currency fluctuations. Other than that, Panama provides countless of options to be a legal resident and its medical care is a priority.

Mexico

It provides a variety of options for established expat and seaside living communities in a lot of areas. Another magnet is affordability with a lot of expats living well on as low as $1200 monthly. The strong position of dollar against Mexican peso means that the cost of living offers better than the normal value.

Costa Rica

The unspoiled beaches and breathtaking landscapes have long fueled the popularity of this country among travelers. For the retirees, the highly regarded health care system with the costs a fraction of what you could pay in the US is a big draw. Getting the status as a resident is straightforward.

Ecuador

In terms of real estate availability and affordability, Ecuador stands out. It is not hard to live on $1,500 monthly and there’s no shortage of retiree benefits.

Colombia

If rejected as a retirement haven due to its reputation for drug cartels and conflict, Colombia has stepped to the spotlight as a great place for those who are looking for excellent health care, low cost of living, and temperate climate.

Spain

It sets apart from others due to its superior infrastructure, a laid-back lifestyle, and world-class health care system. For retirees who are on a budget, the real estate and low cost of living is appealing.

Malaysia

The cities of Malaysia take pride of an unrivaled public transportation system and some of the Asia’s friendliest people. Also, the country straddles the tourism market, which manages to offer both first class luxury vacations and memorable budget holidays.

Malta

This small island chain between the coasts of North Africa and Sicily is easy to miss. However, this Mediterranean destination has lots of visitors for decades because of the centuries-old cities, warm weather, and sapphire blue waters.

Portugal

Another cheap country, Portugal entices the retirees with its low cost of living as well as real estate. A couple may do well on $1,700 monthly in smaller cities including Lisbon, the capital, about $2,200 monthly or more is required. Some huge draws are the mild climate and superior white and red wines of the country.

Nicaragua

The biggest nation in Central America is Nicaragua. Even if it remains poor, there have been some major infrastructure improvements during the past several years including an expansion of Managua’s international airport. Other than that, there is little traffic, great health care, and low cost of living.

April 15, 2019

Why the Capital One Venture Card is the Best Credit Card Available Today

The Capital One Venture Card is one of the credit cards greatly advertised on the market right now. However, its widespread popularity is not only about hype. This credit card is known for offering a significant sum of sign-up bonus, very flexible options on redemption, and a high constant rewards rate. It only means that this is one of the best credit cards you can get today.

Benefits and Basics of Capital One Venture Card

The Capital One Venture Card is a type of travel card. This is designed for people who need a credit card that will let them earn travel rewards but don’t want getting tied to a particular hotel or airline. This card works in a simple way:

You get to earn 2 miles for each dollar spent.
You can redeem miles for statement credit against every travel purchase. These miles are worth one penny per piece once redeemed for travel.

One more advantage is that since you book the flight as if you pay in cash, there is no need for you to worry about seat restrictions, blackout dates, or any other common limitations associated with rewards programs plans of airlines.

Big Bonus Upon Sign-Up

The Capital One Venture Card will give you a head start for your next travel with their sign-up bonus. You can get a one-time bonus worth 50,000 miles if you spend $3,000 on your purchases within 3 months after you open an account, which is equivalent in travel to $500.

High Rate for Rewards

Majority of airline-branded credit cards provide you one mile for every dollar spent on majority of purchases as well as double miles on purchases with the airline. Capital One Venture Card provides you double miles on everything. Its miles are worth the same one cent apiece as it’s the standard within the industry of airline.

No Fees for Foreign Transaction

Oftentimes, credit cards add a surcharge of around three percent to every purchase made in a foreign country. Great travel cards must not charge this fee and Capital One Venture Card doesn’t.

Flexible Redemption

The rewards program of Capital One Venture Card offers you 2 ways of redeeming miles for travel. These include the use of the travel center of the issuer to find deals on hotels, flights, all-inclusive vacation packages or rental cars, pay for them upfront with the accumulated miles.

Is Capital One Venture Card Right for Your Needs?

If you are serious about traveling, Capital One Venture Card must be on your radar. With the best ongoing travel rewards rates and high signup bonus in the market, it may go toe to toe with any travel cards. It is a great option if you like flexibility or you want to travel internationally. However, depending on your requirements, some travel credit cards might be a better choice. If you want to make a wise decision, you should explore some options first before you apply.

April 15, 2019

Top 3 American Express Platinum Benefits

American Express Platinum card has one of the biggest annual fees of any available consumer credit card, yet its benefits more than outweigh the fee. So, if you are a frequent traveler or have a successful business, it’s something that you should have.

The card features a good welcome bonus for the new applicants. If you spend a total of $5,000 for the first 3 months, you will get 60,000 points. While that is a high spend requirement, it might be worth opening American Express Platinum if you have huge expenses coming up. The card may also earn five times points for every dollar spent on airfare bought directly from airlines or through AmEx. You can get 1 point for every dollar spent on everything.

Aside from the welcome bonus, the other benefits of the card include the statement credits for different travel services, benefits at lots of various hotels, and access to thousands of airport lounges. Other benefits of the card should be activated before you could use them. To ensure that you do not miss out, below are some of benefits of American Express Platinum:

Yearly Airline Fee Credit

One of the best benefits of American Express Platinum is its yearly airline fee that costs $200. Every calendar year, you may designate an airline on which you could get $200 reimbursed fees. While fees do not include tickets, it covers some things including checked bags, in-flight drinks and foods, flight-change fees, lounge day passes, fees for traveling with pets, and sometimes, things including extra legroom upgrade and seat assignments.

While it isn’t allowed specifically, you might even buy airline gift cards with credit that you may use for ticket purchases. Once you search online, you may see if it applies to your selected airline. The best thing about airline credit is that you will get it every calendar year and you could get twice during the first year of having American Express Platinum.

Get Up to $200 for Uber Credits

American Express Platinum provides cardholders about $200 for Uber credits every card member year. This perk is added to the card last year. Credit is broken to monthly chunks. At the beginning of every month, you will get $15 of the credits added to your own account on Uber with $20 bonus every December. Other than that, your account will get Uber VIP status that comes with some perks like an option to request rides from the top-rated drivers.

Rental Car Elite Benefits

Other than the gold status at the hotels, you may also enjoy the elite status with some car rental agencies. Once you get your American Express Platinum card, consider logging in online and request status for rental car elite. For you to enjoy this, you have to make accounts with the providers first. The benefits include some things such as guaranteed availability, car upgrades, and waived fees for the additional drivers.

Those are just some of the countless benefits of having an American Express Platinum card. If you want to enjoy all of those benefits, make sure to get one now.

April 15, 2019

Real Estate or Stocks: Which is Better?

When wondering which is better between real estate and stocks, there is really no universal answer for this since lots of this comes down to your preferences, personality, and style. Moreover, it comes down to the individual investment’s specifics.

Before you choose any from stocks or real estate, make sure to know their primary differences.

What is Real Estate?

If you invest in real estate, you’re actually purchasing physical property or land. Several real estate costs you money each money you hold it. Think of the vacant parcel of the land that you want to sell to the developer someday, yet need to come up with the money for maintenance and taxes. Other real estate is cash generating. Think of the strip mall, rental houses or apartment building where tenants send you checks monthly, you pay for the expenses and keep the differences as profits.

Reasons Why Real Estate is Better

You’re more in control. Each physical investment on real estate you make will put you in charge as the CEO. With this position, you can cut costs, make improvements, market accordingly, find better tenants, and raise rents. If you invest in a private or public company, you’re a minority investor who puts faith in management. There are times that managers commit fraud through unwise acquisitions. No one cares more about your investments than you.
Real estate is a tangible asset. It’s something that you can use, feel, and see. Life is all about living and real estate may give you high quality of life. Stocks are not event pieces of papers anymore, yet ticker numbers and symbols. If the world comes to an end, you may seek shelter in your properties.

What is Stocks?

Once you purchase shares of stocks, you’re purchasing a piece of the company. Whether that organization sells furniture, makes ice cream cones, creates video games, manufactures motorcycles or offers tax services, you’re entitled to cut the profit for each share you own.

Reasons Why Stocks is Better

Stocks can offer you a much higher rate of return. Stocks have returned about 7 to 9 percent yearly in comparison to 2-4 percent for real estate for the past 6 decades. You may go on margin to increase your returns, yet it isn’t recommended given your account on brokerage would force you in liquidating holdings to come up with money if things might go the other way. The bank cannot force you to have cash or move out as long as you’re paying mortgage.
Real estate might take constant managing because of maintenance, tenant rotation, and conflicts with neighbors. Stocks may be left alone as well as pay out the dividends to the investors. With no maintenance, you can concentrate your attention on elsewhere like spending time with your business, family or traveling across the globe. You may also pay mutual fund manager 0.5 percent yearly to pick the stocks for you or hire financial expert at one percent yearly.

April 15, 2019

How to Minimize Your Expenses

It requires sacrifice and effort to spend less and avoid debt. This is the reason why not a lot of people really manage to minimize their expenses and enjoy financial freedom. But, it doesn’t mean that you can’t do it, though. Here are a few tips to help you lower your expenses:

Create a Budget

Knowing where your money goes can help you gain better control of your money. Budgeting helps you identify areas where reducing expenses is possible and which areas you should change your spending habits. It is not easy to maintain a budget, much less maintain it. However, with some practice, you will surely master it in no time.

Shop Smart

Say no to impulse buying! Conduct a research first to ensure that you get the lowest price for every purchase you make. This entails visiting several websites or stores before you actually go shopping. Finding the best deals and avoiding impulse buying can help you save some cash in the process. This takes effort and time but any money you save is always worth that extra work. You can then use the cash you saved to pay off debts, make investments, or for any needs you might have.

Lower Your Bills

To lower your bills, you have to cut back on your utilities such as lights, cooling, heating, water, and such. For instance, every time you are away from home, ensure that you turn off all the lights. You can also regulate the thermostat cooler or warmer so that you don’t waste money in making your home comfortable when you are not even there in the first place. Some may find this easy to do but others may not. Always look for a routine that will work for you then stick to that.

One more thing you can do is to research into different phone plans to see if there are new ones that offer the same benefits but at a cheaper rate. You can try to do this with your satellite or cable TV providers, too. Don’t worry if it is just a few dollars saved every month. After all, every dollar you save means more money goes to your pocket.

Refrain from Dining Out

Let’s face it, dining out can get quite expensive. When you eat at home, you will not just save money but at the same time, you can eat healthier and enjoy quality time with your family and loved ones.

Also, when you shop at grocery stores, list down the things you need in advance. Shopping with no list prepared will only make you purchase goods that you don’t need or don’t eat.

Transfer Credit Cards with High Interest to One Account

The high interest rates charged by credit card companies are how they make money. If you are using several cards, one thing you can do is apply for a credit card that has a 0% introductory rate for balance transfers. This will not just let you pay off credit cards at faster rate as you can also save cash along the way.

Spend less and avoid debt through these simple tips.

April 15, 2019

How to Live on a Dollar a Day

What is the lowest budget you can go for a day? Do you think you can make it through with just 10 dollars? How about 5? How about 1 dollar a day? Wait, is this even possible?

If you are just like most people, chances are your mind instantly thought of negative things after asking these questions. More often than not, many people start to shut down then convince themselves that living on a dollar a day is a challenge not worth the try.

Just ask Kerri Leonard and Christopher Greenslate of Encinitas, California. They chronicled their experiment for a whole month in healthy and cheap eating. During this, they learned that it is impossible to eat fresh produce on one dollar unless you have a garden of your own. However, it is very possible to survive on rice, beans, oatmeal, and wheat gluten.

To reduce your budget for food, there is no need for you to try restricting yourself just as how Leonard and Greenslate did. You cannot stay energetic and healthy when you are already becoming malnourished. Since one of your biggest investments is your own health, since you cannot have an income if you cannot work, you have to spend enough cash for you to remain healthy without spending too much money on processed convenience and fast food foods.

Below are several frugal ways to help you save on your food expenses without compromising your health and be able to live on a dollar a day.

Purchase in Bulk

This is the number one secret of Leonard and Greenslate. They bought bulk quantities of rice, beans, and oatmeal. Beans and oatmeal in particular have high fiber and make you feel fuller even for a small amount of money. Purchase as much as you will need for a whole month to enjoy more savings.

Grow Your Own Food

This is not as challenging as it sounds. Every time food prices increase during summer, most people plant their own gardens. You can buy sees for very cheap prices and most vegetables can grow even in small spaces like patio planters or backyards.

Support Local Farmers

Find the closest farmer’s market in your area and take a trip there to pick up the freshest vegetables and fruits of the season. Natural foods always taste great and most of the time, their prices are much better than if you will buy from national supermarkets.

Shop with Coupons

Every dollar a day that you can save is money that you can set aside for future investments. Sign up for your local store’s discount card and use coupons at the same time to increase your savings.

Buy from Bargain Stores

The giant grocery names can charge 50% more compared to low cost discounters. You can find canned goods in bargain shops. There are also dollar stores selling bread, fresh produce, as well as other items that are traditionally expensive. You can even save money if you shop from stores that let you bag your groceries on your own.