Working in the technical industry has never taught me anything about real estate investing. When I was starting out, I seriously had no clue what I was doing. I would put most of my money in mutual funds since it was a little bit better than leaving it in a regular savings account.
Don’t get me wrong my investment accounts had decent returns but I was looking for an even better investment to put my money in. A new way that could help me create passive income so that I could ultimately quit my job.
How To Buy Your First Rental Property
While there are many ways to start growing your passive income, I chose real estate investing simply because I just LOVE everything about it. Not only has it helped me create an additional income stream,
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I mean, why wouldn’t it be?!
YOLO, right?!
So if you’re like me, you will need to figure out how much money you’ve been wasting and start working on your spending habits. Start by making it a habit of tracking down everything that you spend.
The easiest way to start cutting your expenses is to start a budget plan and learn to follow it. Resist the urges to blow your money on those “temporary high” purchases and invest into your long term wealth instead.
Try to ask yourself before buying anything. “Do I need this or do I want this?” This simple question is enough to get rid of most of your bad purchases so you won’t end up having buyer’s remorse as often as before.
Once you have established a good habit. Saving for your initial capital will be soooo easy!
STEP 2: SETUP AN AUTOMATIC PAY-YOURSELF-FIRST INVESTMENT PLAN
What does “Pay-Yourself-First” mean anyway? It simply means that when you get your paycheck, before paying for your bill(s) or credit card(s). PAY YOURSELF FIRST!
Start by setting up an automatic deposit on the same day that you get paid and put a set amount of money away from your chequing account to a separate investment account. This is a good habit to have because this tricks your mind to think that you have no money when you look at your chequing account.
In addition, if your savings account is directly connected to your debit card. Contact your bank and disable it so that you’re not able to select “Savings” if you pay with
* Create a budget- creating a budget will help you not spend more money than you have. Creating a budget will also help you stay out of debt.
If you make a mistake when it comes to real estate, you could lose out on a lot of money when you're not being careful. Investing in your own training is the best thing that you can do to protect yourself.
My mother once said, “Spend your money wisely.” Ever since then I have. Now I want to spend my money on something special, like seeing my sister in Hawaii. In order to have these special things I have to earn money.
But many people still end up spending all their income and leaving themselves with no savings. With regards to this, Mr.Chilton has a very simple solution, “Save first. Spend the rest.”(Chilton 76). I agree with his lesson to save first as saving first and then spending will make sure you won’t end up spending everything. A similar hypothetical situation would be that you have an assignment due tomorrow but you want to play some video games. In this scenario, it would be wise to finish the assignment first because it is the most important and then play video games with your remaining time. Saving is the same; it is the most important to you need to save first. It doesn’t matter how you save, just save. You can use “Payroll deduction, automatic withdrawal, pre-authorized chequing”(Chilton 77), just save first. As well, you have to save right now and “not in a few months when you’re hoping to finally have time to craft a financial plan(Chilton 77)”. When I get a part-time job in the summer, I will start an automatic savings plan with Tangerine in which Tangerine will deduct money to put into my savings every time I get my pay cheque. This way, I’ll definitely save some of my money before I
In regard to saving money, I have found that one of the simplest deals by taking back control over the credit card companies. Faster than expected, credit card debt accumulates quickly. Each purchase on a credit card is not limited to the price on the sales tag, when the entire purchase price is unpaid on the subsequent bill. Be realistic with your purchases. When living on a cash budget, discuss how much “ money is ‘available’ ” for spending as well as how often that amount is withdrawn (Do You Know Where Your Money Is). Avoid signing up for another credit cards when contemplating how to handle expenses. While it may appear that paying off one credit card with another would make it more manageable, it is only compounding the problem. In order to determine spending allowance to pay off debt, I recommend to construct an excel document of the expenses for each month.
Even with my personal problems, I also have had to make other adjustments in my life. We all know college is very expensive, so money is very limited. I was never really good with money until I started going back to school. I am used to shopping and going out to eat everyday. When the time came for me to cut back on my spending, it was like someone stabbed a knife through my heart. It not like I can’t go shopping anymore, it just means I just can’t buy the high-priced, premium items now. For example, I’m used to buying Gucci, Louis Vuitton, and Prada. The only way I am saving money is by just staying away from those three stores. In just two months I have saved lots of money.
“Keep a record of your expenditures. Record and review monthly income and expenses. Determine how to reduce what you spend for nonessentials….discipline yourself to live within your budget plan.”
This may not seem like a major move in becoming debt free, but it gives us well needed practice in changing our behaviors to start becoming money minded. For me this was a step that was already complete, however, for some this may be the hardest step to take because it requires them to change and become committed to a new process (Ramsey, 2012).
Take an honest look at what you're spending. Do you really need a gourmet coffee every morning? Is cable tv that important when you can easily stream a ton of entertainment choices with your high speed internet? Consider where you can cut back, then do it. Apply every dime that you save to building your emergency savings. Watching the numbers grow is the best motivation to keep going.
CAN I adjust my budget? This will vary from person to person and household to household. There are many ways to cut down your expenses such as different grocery stores, paring down unused or unnecessary
It's high time you do something about your spending habits before you get really sorry. You just have to make some changes to your daily life that will help in reducing credit card debt.
Building up a pot of savings is a good idea for everyone. While starting to put money away regularly might feel odd at first it does feel good to know that you have an ever increasing pot of cash to rely on if you need it.
Establish your budget. Are you looking for an easy way to begin? On the first day of a new month, get a receipt for everything you purchase. Stack the receipts into categories like restaurants, groceries, and personal care. At the end of the month you will be able to clearly see where your money is going.
Do not live a life that you cannot handle, spend within your means. Be honest with yourself, if you can’t afford something, don’t buy it! Affordability is much more than the amount of money in your bank account, it also is how long it will take for the money you spent to be back in your account. Think of your finances as a long term process, not a short term fix. This is also why you should limit your credit card usage. If you rack up your credit card and lose your sole source of income,
Money is a precious thing and it can become challenging to not spend it immediately after getting it. It is crucial that this does not happen. There is no denying that money is an important part of society. The world revolves around money and without it, one? would not be able to function. In everyday life the average household will spend one hundred and sixty dollars daily. It is safe to say that money is an resource used daily. It is a tool that can be used to connect with other people or buy anything a person could want or need. Yet it is easy to spend money without realizing how much is really being spent. With only a few simple tips it will become much easier to save money instead of spending it on frivolous things. One’s hard-earned dollar should be saved, and simple tips such as using cash instead of cards, saving small change and only purchasing what one really needs are a few of many ways of doing this. The power of money can easily be abused and it is very important to make sure that a person is well informed on ways to save and spend money wisely.