Finance & Credit Tips

If you don't figure out how to make money while you sleep, you will work until you die.

-Warren Buffett

For personalized advice, info or coaching, contact me by phone or through our website.

Finance Tips

Wealth is not determined by income.

Wealthy people use their income to buy assets such as rental properties, stocks and businesses that fund their liabilities such as cars and luxury purchases.

Becoming debt free and building multiple streams of income is the surest way to become wealthy.

Compound interest is the 8th wonder of the world. He who understands it, earns it; he who doesn't pays it. - Einstein

Compound Interest is the addition of interest to the principal sum of a loan or deposit, or in other word interest on interest. It is the result of reinvesting interest rather than paying it out, so that interest in the next period is then earned on the principal sum plus previously accumulated interest.

If you invest 10% for 5 yrs, you will multiply your wealth by 1.6 times

The 3 types of income are active income, passive income and portfolio income.

Active income is income for which services have been performed such as tips, wages, salaries, commissions and income from businesses where there is material participation. Portfolio income is a subcategory of passive income.

Most millionaires have 7 streams of income. Most types of passive income are derived from real estate/ property, while other types come from royalties from patents or license agreements. Intellectual property such as a book or course is another form of passive income.

Build an emergency fund to cover 6 months of expenses

A $2000 investment is a good goal for someone looking to invest in stocks. There are apps that you can start with less than that.

Money and budgeting apps are a great way to track spending and set goals. Simply link to your checking account.

Below is a chart of a penny doubled everyday to see how compound interest and investing actually works.

Day 1: $.01
Day 2: $.02
Day 3: $.04
Day 4: $.08
Day 5: $.16
Day 6: $.32
Day 7: $.64
Day 8: $1.28
Day 9: $2.56
Day 10: $5.12
Day 11: $10.24
Day 12: $20.48
Day 13: $40.96
Day 14: $81.92
Day 15: $163.84
Day 16: $327.68
Day 17: $655.36
Day 18: $1,310.72
Day 19: $2,621.44
Day 20: $5,242.88
Day 21: $10,485.76
Day 22: $20,971.52
Day 23: $41,943.04
Day 24: $83,886.08
Day 25: $167,772.16
Day 26: $335,544.32
Day 27: $671,088.64
Day 28: $1,342,177.28
Day 29: $2,684,354.56
Day 30: $5,368,709.12

Credit Tips

Keep your credit utilization below 30%. This is 30% of your overall score. To figure your utilization take the amount of your overall credit and keep the amount charged under 30% of your total available credit. 25% is even better.

Using your credit cards and paying the balance each month can still affect your credit negatively because credit cards can all update at different times each month so that is another reason to keep your credit utilization below 30% because this can affect your score 40+ points depending on your percentage.

Did you know that closing an old credit card account can drastically affect your score? Try 40+ points! Leave it open if you're working on your credit.

Each item on your credit report could be affecting it as much as 25 points.

Download a credit app to track your credit and dispute errors all on your own. Use an application with all three bureaus.