While managing your finance, compound interest is one of the most important concepts to understand. Compound interest on your savings will help you earn more returns, but on a loan, it will work against you!

What is compound interest?

First, you all maybe knew that interest means the money earned on money you saved or invested.

Compounding interest is the process of growing your savings. It has the ‘snowball effect’ and means something can build upon itself. Compound interest refers to the interest earned on money that was previously earned as interest. This cycle caused increasing interest and account balances at an increasing rate, which is also called ‘exponential growth.’ It is a good way to put your money to work overtime.

How does compound interest work?

To understand compound interest let’s start with the simple interest: you deposit money in the bank, and it returns you interest on your primary deposit.

In the case of 5% annual interest, you will gain a $5 on $100 deposit after one year. So, what will happen in the next years? Here is the compound interest that comes in. you will get interested in your primary deposit, and will also get interested in the interest you just receive.

Accordingly, you will receive more interest in the second year compared with the first year, since your account balance is now $105, not $100. Although you did not increase your initial deposit, your earnings will accelerate.

First-year: A primary deposit of $100 receives 5% interest, or $5, increasing your balance to $105.

Second-year: Your $105 receives 5% interest, or $5.25, increasing your balance to $110.25.

Third-year: Your $110.25 receives 5% interest, or $5.51, increasing your balance to $115.76.

It was an example of interest compounded yearly. Interest at many banks, especially the online ones, compound daily and get added to your initial deposit monthly; therefore the process goes ahead even faster.

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Take advantage of compound interest

Do you want to be sure if compounding works out in your favor?

• Save early and often. Time is the friend of compounding interest. Since the compound interest grows exponentially over time, the longer you do not touch your money in a saving account, the greater it can grow. If you add a $100 deposit per month at 5% interest (compounded monthly) for five years, you will have $6,000 deposits, plus received $800.61 in interest. Even if you do not add up any money to your deposit after that, your account will receive an additional $7,573.87 in interest after 20 years. This will be more than your primary $6,000 due to compounding.
• To see the true annual rate of compounding, you can check out the APY (annual percentage yield). Banks usually publicize the APY, so you can easily find it. If you have an extremely large account balance you should try to get decent rates on your savings.
• Pay debts quickly and pay extra if you can. Paying the minimum on your credit cards will cost you too much since you will hardly reduce the interest charges and your balance can grow. If you have student loans, prevent adding unpaid interest charges to the balance total and try to pay the interest as it accrues. This way you will not be caught off guard when graduating.
• Keep borrowing rates low. The interest rates on your loans, besides that impact your monthly payment also will determine how quickly your debt grows. See if it is possible to merge debts and lower your interest rates when you pay off debt.

What makes compound interest powerful?

When interest is paid repeatedly, compounding happens. The first one or two years are not very impressive, but compounding starts to improve after the interests add up over and over.

Frequency: The frequency is very important in compound interest. More frequent periods such as daily, have more surprising results. Look for daily compounding while opening a saving account. Although you see the interests add to your deposit monthly, it calculates daily. There are also accounts with monthly or annually calculating interest.

Time: Compounding is more surprising over a long time. If you left your deposit for a long time to grow, you will earn higher calculated interest.

Interest rate: One of the significant factors in your account balance over time is the interest rate. Your account will grow faster in case of having higher rates. An account with compounding but a lower interest rate, especially over a long time, can end up with a higher balance compare with a simple account.

Deposits: Withdrawals and deposits also impact your account balance. Leave your money alone to grow or add a new amount of money to your initial deposit regularly works best. If you withdraw your interests, you will decrease the effect of compounding.

Compound interest works both ways. It can make you, and it can break you. If you owe money, the compound interest on your debt can ruin you. As a result, many people keep paying the bill with high interest. Despite numerous payments, the balance of the bill barely goes down because high interest on the balance continues to compound. Sometimes, it feels as if it’s important to pay the balance off.

Conclusion

The power of compound interest can be hard to understand. This article provides you with a few situations to show the impact compound interest can have over time. Set a time sooner to open a saving account with compound interest, and then you will have more time for compound interest to work in your favor.

“If you have any feedback about how does compound interest works that you have tried out or any questions about the ones that I have recommended, please leave your comments below!”

NB: The purpose of this website is to provide a general understanding of personal finance, basic financial concepts, and information. It’s not intended to advise on tax, insurance, investment, or any product and service. Since each of us has our own unique situation, you should have all the appropriate information to understand and make the right decision to fit with your needs and your financial goals. I hope that you will succeed in building your financial future.

Money is among the biggest things that people worldwide are worrying about, even more than their health, families, or jobs. It has been said often that money is the ticket to happiness. Human binges mind always seek pleasure and avoid pain. It is a common belief among people that if they have money, they will be happy; otherwise, they will be miserable. Therefore the reason people worry is that they believe money can help them get more pleasure and prevent them from pain. In case people have worried for a long time, this thought will change into a habit, and eventually, they will feel anxious more often in their life.

How worrying about money can affect your life?

It is worth mentioning that many around the world scared of losing their jobs during the COVID-19 pandemic, falling into uncertainty about their future savings and economic situation. They are worried about what would happen to them, especially after getting too much news. In such a situation people start asking, “what if?” And as you may know, what-if scenarios can get out of control fast. The fact is, they may happen all the time in everyday life-not just during a pandemic.

Being worry about money also can affect relationships. It would be specifically damaging in marriage. It is difficult for couples to be empathetic, supportive, or even romantic when they are worried about money. While emotions are getting pale and the financing issues are getting too much, one of the couples might say something less kind than usual. That is why money is a leading cause of divorce for decades.

In another situation, the topic of money turns into fights for couples and it prepares them for financial infidelity. It tempted them to hide their spending rather than engage in the conversation and make purchasing decisions together.

Many physical health problems are leading by money stress. Worrying about money can cause diabetes, cardiovascular disease, migraines, sleep problems, and more issues than you realize. And worst is when people postpone going to the doctor because of the expense.

Today, the younger generation is also suffering from anxiety and depression; and that is because they are trapped into debt at a young age. There is always something they can do to change the situation of their life and stop worrying about money.

How to stop worrying about money

Here are the steps that will help you overcome financial anxiety and stop worrying about money:

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1. Master your life

By deciding to read this article, you simply take the first step. So you want to master your life and do not want to be a victim of your circumstances anymore. Now you are planning to learn something to make your life better and stop worrying about money.

The thought of victimization is widespread in our society. People wrongly have thought that they have no control over their lives and what happens to them. The fact is that your environment, your mind, and your beliefs are what build your reality. Your mind generates coherence between your mind and your reality.

To stop worrying about the money you should first take back control of your situation. Regardless of the occurrences in your external world, how you feel it inside your mind causes your outcome. If you see what happens as something that you cannot control, then you are a victim of your circumstance. In case that the external happening is not mattered for you, you are the master and creator of your life.

2. Accept the current reality

Decrease the tension between your current reality and how you tend it was different. While arguing with your reality, you feel tension and frustration. People wish things were different, and this makes them suffer. They ask themselves why those things are happening to them. When you stop opposing your reality, no more questioning about why this is happening to you, or wishing life was different, your mind can eventually become completely clear.

When you accept your current reality, actions become fearless and simple.

3. Make a plan

A plan can assist you to control what you can, and that is your money. Your plan can be everything from working to get out of debt or save an emergency fund, to your monthly budget, or a long-term investment plan for your retirement.

Here is an example of debt snowball:

Let’s start with the number of debts you have. Write down all your debts from the smallest to the largest. Pay more on your smallest debt. In this way, you can get rid of them sooner than usual. When your smallest debt is gone, focus on the second smallest debt and then the third-smallest one. The more you pay off, the more you get free.

3. Be aware of your weaknesses

Having a plan is the key to stop worrying about money. But, exactly when you think that you finally manage your finances, something happens that will seduce you to return to old habits. You are thinking of a new transmission for your car and you want to pay for it by credit card. You have been invited to a vacation, and you wish to reach your hands on your emergency fund. You are going to take out a Parent Plus loan to send your kids to college.

That is because being aware of your weakness is so crucial. Do not dwell on them, just know that what they are become it easier to stop a bad habit at the right time.

Conclusion

Remember that worrying about money is just a waste of time.

By reading this article you may prepare yourself to stop worrying about money, stressing, and losing sleep. We recommend you to read more about how to stop worrying about money and teach yourself how to overcome frustration and stress on money by reading relevant books, blogs and using experts’ advice.

“If you have any feedback about how to stop worrying about money, that you have tried out or any questions about the ones that I have recommended, please leave your comments below!”

NB: The purpose of this website is to provide a general understanding of personal finance, basic financial concepts, and information. It’s not intended to advise on tax, insurance, investment, or any product and service. Since each of us has our own unique situation, you should have all the appropriate information to understand and make the right decision to fit with your needs and your financial goals. I hope that you will succeed in building your financial future.

Being financially intelligent means knowing how to manage, save, and invest money efficiently for you and your family. It contains different things like budgeting, investments, getting out of debt, real estate, insurance, college, and retirement planning. Financial intelligence is a subject that matters to almost anyone. Unfortunately, people are not learning enough about it. Without adequate financial education, peoples are unable to save for retirement, buy homes, or pay for unexpected expenses like car repairs.

What is financial intelligence?

Financial intelligence means having a basic understanding of issues related to money and finance, particularly someone’s finances. When you are financially literate, you will be able to:

• Pay your household bills
• Build a household budget
• Calculate how much you are paying for credit cards
• Open a bank account and keep track of your balance to prevent overdraft fees
• Check your credit score and take action to enhance it
• File an income tax return
• Open an account to save for college
• Figure out your net worth
• Shop for a mortgage loan
• Invest in a retirement plan
• Protect your personal information
• Spot a financial scam

Sadly, many people cannot meet this standard. Researches have shown that a majority of people worldwide lack the knowledge necessary to make routine financial decisions. Surely, it takes time and effort to improve your financial intelligence. However, when you invest in yourself, you begin investing in a better future.

Some good habits to enhance financial intelligence

• Concentrate on saving

Saving money is a great habit for people with high financial intelligence. Regardless of the amount of your income, become it into a habit to put aside part of your earnings each month. Put some money aside, it is crucial for your life since it encourages you to spend cautiously and also assists you to create a fund for emergencies. You will be able to fund your short and long-term goals with your savings, it prevents you to burden yourself with a loan or cut down your regular expenses.

• Assess your spending

Do you feel your money is slipping through your hands? It is time to check out where all this money is spending. The first step is making a daily, weekly, or monthly basis listing habit to put all your expenses on the list.

It will help you manage your finances better by assisting you to keep track of the expenses which are significant or not. Also, you can write a personal journal or diary to follow your daily expenses in case you have difficulty remembering where you spent your money.

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Make a scheme of your buying

Many people wish to buy some commodities that are more expensive than they can afford. This may be a new car, a new cellphone, furniture for the garden, jewelry; there is no end to the luxuries people wish. Although, you might want to get these immediately, a sign of financial intelligence is planning your buying and purchasing them after saving adequate money. In this way, you can prevent yourself from impulsive shopping, and in case you want to purchase something that falls outside of your budget, save up and then buy it.

• Invest

Investing money is also a great habit besides that saving. By investing, you will be able to multiply your money, whether for the fulfillment of short-term goals or retirement planning. To invest money you can find various options around like real estate, currency, share market, fixed deposits, etc. To make good and steady returns while investing money, make sure you research enough on various aspects of the market you intend to dive into.

• Limit your credit card spending

In case you want to create and improve your credit score, having a credit card is good. But, when you plan to enhance your financial intelligence, we recommend you cut down the number of credit cards you have and use. When people own too many cards, they often lose track of all their spending. The figure that will be presented at the end of the cycle may through your whole budget off balance. If you continue this behavior, it would impact your financial stability in the long run.

• Take a loan only on necessary occasions

Today, because of the easy accessibility of loans, people can buy even luxury goods easily. Such a shopping behavior in long term would severely impact your financial health.

Only when there is an absolute need for a loan, consider taking it, and remember that your income must be adequate to manage the pressure of monthly installments.

• Read about personal finance

You can learn much more from a good book than personal experience after you have made mistakes. Great books from great authors are including Robert Kiyosaki’s “Rich Dad, Poor Dad”, Dave Ramsey’s “The Total Money Makeover”, David Bach’s “The Automatic Millionaire”, Beth Kobliner “Get a Financial Life”.

By reading these books you can improve your financial intelligence and also bring many common doubts about personal finance to the light. We also suggest you spend time reading blogs, articles, and magazines about personal finance and budgeting; they can give you the right tips and tricks for handling your finances the right way regularly.

Conclusion

Doing everything good seems intimidating at first!

You may not financially literate at school, but you can learn it. It requires spending some time and effort to peace financially. When you start performing healthy financial habits regularly you will be able to cope with all your financial goals.

We recommend you some “do’s” and “do not’s” to remember while embarking on your finance journey.

Do:

• Utilize the entire financial resources that are available
• Keep learning through taking classes and professional financial advisers
• Start budgeting and follow it

Do not:

• Fear! You need to start from a point, and over time your finance will be stable.
• Do it alone. You can find many people including experts and advisers willing to help you.
• Limit your chances. Explore various skills and certifications to increase your job opportunities.

“If you have any feedback about how to grow your financial intelligence that you have tried out or any questions about the ones that I have recommended, please leave your comments below!”

NB: The purpose of this website is to provide a general understanding of personal finance, basic financial concepts, and information. It’s not intended to advise on tax, insurance, investment, or any product and service. Since each of us has our own unique situation, you should have all the appropriate information to understand and make the right decision to fit with your needs and your financial goals. I hope that you will succeed in building your financial future.

While wedding costs are getting more and more expensive, no one cares about how much does it cost for guests to be only a part of this ceremony. Attending a wedding is not cheap! At the same time, you might be excited to celebrate a loved one’s big day you also might be worried about the expenses a wedding burden on you. By reading the current article you will learn some tips and tricks to help you to attend a wedding on a budget.

Budgeting for Weddings

Prior to making a plan on how to save money on the weddings, you will attend, you should know how much to save. Consider your budget; is there some extra money that you can put aside for wedding expenses? If no, you may have to change a bit your spending habits to afford to attend those weddings.

In case you do not have a budget, it is a good time to make one. Start following your income and your expenses, check how this two compare, is there any remaining to put aside? How much? Chose the amount you can work with, and stick to it. Arrange it in an individual account or your general saving account, check out how much you gather to spend.

Reducing Expenses of Wedding Essentials

1. Outfit

For men, there might be fewer worries about what they wear and how much it will cost them. They can wear one single suit or tuxedo at every wedding, and no one would even notice.

But for women, the story is different, although, it really does not have to be. If you have to attend more than one wedding at a certain time like summer, as a woman you can dress simple. Let’s make it clearer, chose a stylish but basic dress in black or navy blue (neutral hue in other words) and work on your accessories.

You can wear a large statement necklace with a black cocktail dress to a wedding, and wear the same dress with a sash as well as a pair of glittering earrings to another wedding and attendees will think it is a different dress. Instead of purchasing multiple dresses, that cost you too much, you will get one single dress and use it in the wedding after the wedding without anyone noticing the difference. You can apply the same trick to your shoes. Buy a pair of pumps or strappy sandals and use them during the wedding season.

In case you have invited just to one wedding in the season, consider renting a dress. Renting a dress is the most economical way. You do not have to spend several hundred dollars to buy a dress, and instead, you only need to pay $35 to $50 to rent one. If you are living close to a dress rental service, by chance, you can try on items before you rent.

There is more than a dress to rent from a rental service. In case you wish to replace your accessories from wedding to wedding and do not like to have a drawer stuffed with necklaces and earrings, you can rent those at a cheaper price. Based on the materials used, designer, and style, necklace rentals begin from $10, and purse rentals begin from $30 at rental services.

2. The Gift

Purchasing a gift is also a part of going to a wedding. There is no restricting rule on the amount of money you should spend on the gift, regarding how much you can afford.

You can buy something that seems you broke the bank on it while protecting your budget. The online promo code can help you with that, specifically when your friend registered at places that often use them.

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You do not have to provide the gift from the retailer the couples are registered with. Amazon is a website example that allows you to buy the gift elsewhere and check it off the registry, to prevent duplicates. Try to get your gift sooner. If you wait until the month before the wedding, you will see just the priciest gifts remaining.

There are also other options to save on the wedding gifts:

• Share buying the gift with a friend. A $120 gift will cost you $60 if you split the cost with a friend.
• If you are talented and trained on how to decorate flowers or cake, then offer your services to the couple. If you are excel at the service you offer you will save money and so they will.
• Do something creative. A heartfelt gift is sometimes more valuable than anything on the registry. A photo book full of the couple’s picture together can be a great gift.

3. Transportation

Based on how far the wedding is from your place, travel can be your concern of expense. How you get there affects how much you spend. For instance, a fly from New York to Philadelphia costs around $150, while taking the bus will cost you $5. Getting to and from the airport is also time-consuming.

Pick the best day for travel also can aid reduce your expenses. Renting a car will be cheaper on the weekend rather than on weekdays. Since car rental companies target business customers, rather than leisure travelers, they have more cars to rent during the weekend.

Fridays and Sundays are the most expensive days for flying, in case you consider taking a plane.

4. Lodging

If you do not have any close relatives or friends to stay with, you have to stay in a hotel. Bride and groom usually reserve several rooms at a discounted rate at specific hotels. If you are included in such action, go ahead. But remember that if you search more you can save more. A bit less luxurious hotel may provide you with a price even cheaper than the discounted one.

Other than the hotel, you may find a private room for a great price. You can even search for a house to rent if you travel in a big group or with your family. There are certain websites for that.

Conclusion

If you invited to a couple of wedding ceremonies this season, you do not have to spend too much that ended you up with regret on your financial decisions. Set a list of fixed numbers before you start to make any plans. Before you attend a wedding you should know how much you can spend on your clothes, the gift, and traveling.

Be sure to make a plan before you attend a wedding.

“If you have any feedback about how to attend a wedding on a budget, that you have tried out, or any questions about the ones that I have recommended, please leave your comments below!”

NB: The purpose of this website is to provide a general understanding of personal finance, basic financial concepts, and information. It’s not intended to advise on tax, insurance, investment, or any product and service. Since each of us has our own unique situation, you should have all the appropriate information to understand and make the right decision to fit with your needs and your financial goals. I hope that you will succeed in building your financial future.

Throughout history, mankind has been trying to find various ways of expanding and diversifying income generator models. Doing that we tend to exaggerate obstacles on the road. But with a little help from the experts, those obstacles tend to get smaller and shorter in time. In our articles, we aim to do that in a short amount of time considering everybody’s time is valuable and precious. We are well aware of the fact and we aim to make everything less challenging for you. Previously in our articles, we made this fact clear for you as well. Your job on the other hand is to pay close attention to our articles and apply the necessary changes in your financial life. As long as we are clear on these terms, the obscurity will leave us in the process and we’ll see brighter days ahead.

Speaking of today’s topic, we’ll discuss what to look for before applying for a mortgage. After reading this article you’ll have related background knowledge and information that will shape your decisions on various advantages and disadvantages of getting a mortgage. I know that it has already started to sound thrilling. If you’re ready to take off, fasten your seatbelts. Because as we always do, we are getting ready to fly once again.

One of the most crucial aspects before getting a loan is surely the ratio of the fees and the question What fees apply to the loan? In order to help you more with details, we’ll present some of the fees included in the loan below. We hope that you’ll find it useful and add it to your device list for necessary future calculations

• Application fees (also called establishment fee)
• Property valuation fees
• Ongoing fees such as annual fees
• Late payment fee (also called default fee) (if you make a required repayment later than the due date)
• Early exit fee (if you repay your home loan in full and close the loan before the end of the loan term)
• Discharge fee (also called termination fees or settlement fees) (charged when you pay out your mortgage in full)
• Break fees (also called break cost) (if you switch loans during a fixed-rate term)
• Redraw fees (if you use a redraw facility)
• Account-keeping fee for offset account (if you have an offset account attached to your loan)
• Lender’s Mortgage Insurance (LMI) (if you only have a small deposit on your loan)

Now that you know the additional fees we can move on with the interest rates. This is another crucial aspect when it comes to making necessary calculations before getting a mortgage loan. Speaking of interest rates there are 2 kinds of interest rates that may help you along the way. The first one is the advertised rate in which you just pay the interest rate, the additional fees or charges are not included in the price.

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A health savings account is a kind of tax-free savings account that you can use to save on medical expenses when enrolling in a high-cost, affordable health care plan. If you have an HSA and have just moved from a job, this article provides helpful tips on what happens to the HSA when you leave work. And even if you do not intend to change jobs at the moment, it is still a good idea to read this article. Because if you have HSA, it is better to know your options ahead of time if you are in a condition where you need to change or quit for any reason.

The HSA has long been one of the most powerful savings accounts authorized by the federal government. Health savings accounts have many advantages and can save health care costs and even retirement for you. If you can wait until age 65 to use the money saved in the HSA, you can even use it as a retirement account instead of a health savings account.

A health savings account helps you pay for medical expenses that your insurance policy does not cover. Besides helping you save money for out-of-pocket expenses that health insurance will not pay for, HSAs offer other benefits.

What happens to your HSA if you quit your job?

The funds in your HSA are always at your disposal, regardless of employment status or insurance coverage. The fact that HSA funds are always given to you is another important advantage of this type of account. Unlike Flexible Expense Accounts (FSAs), savings on HSA accounts do not have a specific date. This means that if you change your job or health plan, you can maintain your HSA and spend your budget normally on eligible medical expenses or see it grow until retirement. (As long as you are ready to use your cash any way you want). You can also help your account as long as you comply with IRS eligibility rules.

Benefits of HSA when changing jobs:

• The HSA acts as a savings account:

Many consumers are unaware that, in addition to accumulating various tax benefits, many HSA accounts allow you to invest your capital like pension funds. You can keep your Health Savings Account (HSA) when you leave your job. Even if you open your HSA in connection with a high deductible health plan (HDHP); All the money in it, including your employer’s contributions, your contributions, and interest or investment growth, will be given to you.

This post contains affiliate links. Please please read my Disclaimer for more information.

• Pay COBRA monthly premiums using HSA:

If you lose your health insurance due to leaving your job, you can use the money in the HSA to pay your monthly COBRA premium. This is an eligible medical expense, so you will not have to pay income tax on withdrawals.

• Use your HSA as an emergency fund:

Some people consider their HSA as an emergency fund and invest their HSA funds in stocks, bonds, or interest-bearing accounts. You can use the money of your HSA to pay for medical expenses. But some people allow the profits from these investments to grow for years without tax. These people pay their medical bills with other money, and they save these receipts for medical expenses paid from other funds. When they need money in the future, they can get it back from your out-of-pocket medical expenses for the duration of the HSA. Withdrawn funds are not taxable, as they can be used to reimburse you for any medical expenses you have already incurred.

• HSA for retirees:

When you turn 65, you may withdraw money from your HSA for any reason without incurring a 20% non-medical withdrawal penalty. However, the only money you receive for eligible medical expenses is tax-free. Note that you can always use your HSA budget to pay for your spouse’s treatment.

HSA and its relationship with the employer:

If you have an employer participating in your HSA, these benefits also belong to you, but they do not happen again after leaving your job. Your employer cannot withdraw any of your benefits, and all of your HSA costs are for your maintenance and use. If your employer pays some or all of the monthly management costs to your account, you will be responsible for those costs. HealthEquity will email you if your dependency changes, including information about these costs, as well as suggestions for preventing or reducing them.

While you are preparing to leave your job for a new job, freelancer, or any other purpose, it may be wise to compare health savings accounts and their offers, so you can move on to a new account. You may want to transfer your existing HSA funds to your new HSA. Under these circumstances, you can still keep your existing HSA open and intact and open a new account with your new employer to enjoy the benefits of employer-backed HSA. Note that just because your employer offers an HSA health care plan does not mean that the HSA is better.

There are no rules for having multiple HSAs. The only thing to keep in mind about multiple HSAs is that the total participation fee for all of your HSAs should not exceed the maximum annual IRS contribution for your specific circumstances.

Conclusion

Today Many employers offer HAS accounts to employees. This type of account provides a tax-free contribution to cover medical expenses. As we explained in this article, if you leave your job, you can keep your funds in the HSA. One of the main benefits of HSA is that it only belongs to you. The HSA belongs to you, and you can retain, terminate, resign, relocate or retire. You can keep a health savings account and all the money in it, including your employer’s assistance.

If you receive unemployment advantages, you can use your HSA to pay for long-term care, COBRA premiums, or other health insurance premiums. We hope by reading this article, you are aware of the countless benefits of HSA (even after leaving the job). If you have experience using this type of account, share it with us.

“If you have any feedback about what happens to my HSA when I leave my job that you have tried out or any questions about the ones that I have recommended, please leave your comments below!”

NB: The purpose of this website is to provide a general understanding of personal finance, basic financial concepts, and information. It’s not intended to advise on tax, insurance, investment, or any product and service. Since each of us has our own unique situation, you should have all the appropriate information to understand and make the right decision to fit with your needs and your financial goals. I hope that you will succeed in building your financial future.

During hard times, hard measures have to be taken. Or else the obstacles will still be there and what’s even worse is that they’ll grow bigger on the road. The perseverance to fight those obstacles is not easily found every day. That’s why we’re offering our help on the road because deep down inside we know that you can’t fight everything on your own, there’s no meaning of fighting everything too. If we’re bigger as a team, the obstacles on the road will get smaller. We just need to keep the growing concentration on a healthy scale.

Today, just to help you gain more understanding on a wider scale of finance, we prepared our brand new topic for you. We’ll start with the question Will mortgage affect my credit? and we’ll move on with the necessary details and information to be useful for you on your journey. The last topic was on mortgages, and we have seen that the demand for mortgage-related articles is rising. That’s why we decided to bring more information about mortgage-related issues. If you’re ready to get more sophisticated on this, fasten your seatbelts. Because today is the day that you’ll be freer.

Let’s first start with the question what’s mortgage forbearance? ıt’s basically a short-term suspension of payments in tough times. It can help you overcome some challenges or make your status worse depending on your rate of repayment. So here’s your short answer. Yes, it’ll affect your credit. But it’ll affect your credit more if you do not plan and calculate the necessary results wisely. That’s why today we’ll once again offer you some tips to form your plan wisely and smartly. During hard times like this pandemic, it’s more important to keep these tips in mind. Because as we said before the less calculation we make the more risks it’ll bring.

There’s one exception, which is student loans. If you had a grant before and you’d pay that grant on a scale. There’re some tips for you. You’ll find them below at the end of our article. Keep reading because it’ll bring value for all different kinds of audiences there.

There’s a difference between these terms. Forbearance and Deferment. Under the Forbearance agreement, it’s stated that it takes 12 months. In those 12 months, the lender agrees to accept reduced payments or no payments at all depending on the situation. At the end of this period, the borrower must continue regular payments with interest and possible fees. 12 months of forbearance will be added to the rest of the months as installments. Whereas in a loan deferment, payments stop for a certain number of months, when the period ends, loans continue as before without any additional interest or price difference. No repayment is required at all.

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So how do we understand if Mortgage forbearance will be useful for my financial situation?

Actually, you can’t. Forbearance is just easier to get compared to deferment. Because during times like this pandemic, most of the institutions give you the chance of applying for forbearance. Besides all you need to do is that you need to prove your financial hardship, not paying the bills might be easy proof for you in that case. But when you delay your spendings please don’t forget that interest will be added to them when you start your program once again. That’s why adding this into account will vastly change the equation. Also, be careful and search for possible ways to avoid foreclosure. It’s also one of the things that you might want to take into account.

All of these mentioned above will likely affect your credit rate negatively if you decide to take a mortgage forbearance. But if you’re requesting forbearance because of the coronavirus we have some good news for you. Please read the following quote well.

“As part of the Coronavirus Aid, Relief and Economic Security (CARES) Act, mortgage accounts in forbearance as a result of COVID-19 cannot be reported negatively to the credit bureaus by Lenders”.

Now you know the good news. If your jobs are affected by the pandemic, then you can get forbearance without getting any negative rate from the institutions. All you need to do from now on is to prove that you’re affected by the pandemic negatively.

However, without an agreement, if you skip your payments or if you make partial payments, it will be considered delinquency which is even worse because delinquencies are recorded on your credit report and they’ll have a bigger negative impact on your credit score. That’s why it’s really important to calculate everything beforehand. Without calculating any possible results you’re putting more burden on yourself during your financial independence journey. But with the help of our articles, we believe that you’ll overcome these as well. Because as always we’re proud to present ourselves as the one aiming higher.

As a student you have some benefits as well, you can get 2 types of forbearance if you ask. The first one is general forbearance in which you can get reduced or suspended payments up to 12 months whereas the second one is mandatory forbearance in which if you’re enrolled in some kind of service-related work as we mentioned before, you can get even deferment. It’s worth further investigating these topics if you ask me.

Conclusion

Finishing our words once again we are proud of the fact that we did not exclude any group or community giving this valuable information. We tried our best to help you all with these financial tips and advice. We hope that you’ll use these pieces of information for the good of the public as well. Starting from students to those in debt and need. We once again enlightened some crucial aspects for you in our brand new article. We hope that you can overcome challenges on the road and join our long-term vision. Because we still have challenges to overcome and problems to solve on the road. Since we have the necessary passion for it. See you soon.

“If you have any feedback about will mortgage forbearance affect my credit that you have tried out or any questions about the ones that I have recommended, please leave your comments below!”

NB: The purpose of this website is to provide a general understanding of personal finance, basic financial concepts, and information. It’s not intended to advise on tax, insurance, investment, or any product and service. Since each of us has our own unique situation, you should have all the appropriate information to understand and make the right decision to fit with your needs and your financial goals. I hope that you will succeed in building your financial future.

Losing a job temporarily or permanently in the middle of applying for a mortgage to buy or refinance a home can be a big challenge. Do not worry if you lose your job. After you get rid of the initial shock, contact the lender and explain exactly what happened. Join us because in this article we will explain what to do to solve this problem.

Depending on your circumstances, you may encounter the following:

Explaining your new employment situation to your lender requires you to tell them that the job loss is permanent or temporary. Lenders are looking for reliable income in the future.

If your employer has promised to return to work at a specific time or is committed to future plans to re-employ you at a specific time, give your employer a letter to the lender.

If the borrower’s income decreases while continuing, the loan application can continue until they can reduce their repayment ability and other instructions with that level of income. But when the borrower cannot repay at a reduced rate, he must pause until his income returns.

Unpaid people should suspend their homes until they return to work. In many cases, unemployed people without a fixed income do not qualify for a mortgage.

People who have a history of receiving unemployment incomes and do not receive a salary in some months may be able to move forward, but their condition still needs to be assessed.

If you are self-employed, lenders will check that your business is public and profitable. If your business is even temporarily closed, lenders may not approve your loan application, and your previous income statement will be of no value to them.

If your job is such that you receive a commission, you work short hours, and your salary is low, the lender may consider income instability for you and leave your loan at a low-income level.

Lenders do not usually change your income’s stability, but they may do so if they see that your income is declining.

If your income is not suitable for your home, you should reject your purchase agreement. Then you can find another home that fits your new budget and start the mortgage process again. You can also wait for a good financial return.

In such a situation, the best thing you can do is:

Inform your lender quickly and then suggest options for closing your plan. If you lose your job after a loan is approved, take the necessary steps. The bottom line is that your lender cannot be closed unless you provide another source of income. Losing a job does not necessarily mean you can’t buy a home, but you can do the following to make it happen:

· Have a good credit history:

After losing your job, you need to have a good credit score or at least maintain a credit score that best meets your lender’s needs. Delayed payments and lost payments can lower your score, which can discourage the lender from approving the mortgage.

· Explain the reason for losing your job:

If you lose your job for any reason, you can still buy the property, but your lender may delay closing. If you have temporarily lost your job, your lender may not cancel the loan immediately because you can return to work before your plan closes. But if you are still unemployed near the closing date, the bank will probably cancel the loan. If you have lost your job permanently, your lender has no choice but to cancel the mortgage.

· Looking for a new job:

If you are lucky and can find a new job, you can save to repay the loan. It is good to know that the borrower must be at work at least 30 days before closing. Also, your new job should be in the same field as your previous job, and your new income should remain almost constant or increase. The lender will request your recent payslip and confirm the job with your new employer.

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· Ask the lender to recalculate your income:

You can have several sources of income to get a mortgage. So if you have lost your job and have no income, you can use other income sources to qualify for a loan. These income sources can include alimony payments, child support payments, disability income, and retirement income. But keep in mind that payments must continue for at least three years after closing.

· Get fewer mortgages:

If the lender recalculates your income, it is still less than the original amount; In such a situation, it is better to cancel your original purchase and look for a cheaper property. You can also continue shopping and pay more in advance. Depending on your circumstances, check which of the above methods is right for you.

You can use gift funds for prepayment. Many lenders allow you to use gift funds for your down payment and closing costs. To do this, the lender needs information about the donor, including their relationship with you, the amount of the gift, and a letter of inability to repay.

· Find a borrower for your loan:

Another way is to get a custom mortgage. This person can be a member of your family who has a stable financial position and can meet the lender’s minimum credit score requirement.

But before doing so, you need to be aware of both the risks associated with getting a loan because both you and the person are responsible for repaying the loan.

Conclusion

An unexpected life event, such as a sudden change of job, can happen to anyone at any time. Losing your job after getting mortgage approval can be a problem for you. It may take weeks, months, or even longer find a new job. In such cases, it is possible for your lender to cancel your loan. But if you lose your job, you should talk to your lender as soon as possible. In this article, we provided methods to solve this problem. We hope you find this article useful.

“If you have any feedback about what happens if I lose my job before closing on a mortgage that you have tried out or any questions about the ones that I have recommended, please leave your comments below!”

NB: The purpose of this website is to provide a general understanding of personal finance, basic financial concepts, and information. It’s not intended to advise on tax, insurance, investment, or any product and service. Since each of us has our own unique situation, you should have all the appropriate information to understand and make the right decision to fit with your needs and your financial goals. I hope that you will succeed in building your financial future.

Credibility has been built deep into our lives. Once on the road, we tend to ignore ups and downs in the process. Having passion and determination for what we have focused on is what we care and when we face challenges we understand that we need to study our lesson more thoroughly. That impulse is what we call a reflection. Every mistake we make on the road affects our credibility. Not just in the finance system but also in our community as well. In fact, one of the most important achievements is to earn credibility rather than earning money. Because money is a tool for success, but if you don’t have enough education, patience, and determination to earn it, it can ruin lives as we have seen in our society most of the time.

Today our article will investigate the notion of credibility with the question, What are the ways to buy a house with bad credit? You’ll find your answers as you always did. But if you expect to have easy answers, perhaps this is not the best place for you. Because over a month ago we planted our seeds for our future, and we declared that ıt would not be an easy path. We’ve all accepted to take the bitter pill, and that is the reason we have been growing continuously since then. Those who agree with us will in time find out the joy of earning and helping more with us. Thanks for your continuous curiosity. Keep up the hard work.

Now we can move on with our topic today. As we said before credibility has an enormous part in our lives. But what if we stumbled before and now we’re trying to fix it? In other words, what if we had a bad credit result before, and now we’re searching for new ways to fix it. We’re trying to fix it because we want to have a property most of the time. In that case, you’re not alone. In order to make this path clearer for you, we have our tips and clues getting ready for you.

Firstly we should understand the credit score ranges so that we can calculate everything easier.

Exceptional: 800-850

Very good: 740-799

Good: 670-739

Fair: 580-669

Poor: Under 580

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Considering these numbers we should first analyze where we are located, that will be your task here. Because without understanding where we are we can not move forward. So that’s the first thing to do for you before we move on.

Now if you checked your results and understand where you stand then we can continue with the possible tips and solutions that may help you along the road.

If you’re on the low scale, that means you’ll have to pay higher mortgage interest, unfortunately. But don’t be discouraged you’re not locked into this rate forever, rather you can enjoy lower interest rates when you continuously pay your credit, so the amount will change once you’re on the road. But as mentioned before you need to calculate everything wisely. That’s when we get into the stage, following us you can learn more about this process.

As clearly stated before you need to cut your spendings and increase your income-generating models. Because when you want to buy a property mortgage Lenders will check your debt to income or DTI ratio. So don’t put too much burden or dept on your shoulders because they will obviously affect your future plans and calculations.

One useful tip for you. You need to spend no more than 28% of your annual income on a mortgage. For example, if you make $100.000 a year, you need to spend approximately $2300 a month. No more than that amount is acceptable. Keep this in your mind for future research and realizing your dreams. In order to realize them, you continuously need to check our articles as you can see we bring this valuable source of information to your homes with no cost at all. All you need to do is to pay attention and study your lessons on time.

Besides, Lenders don’t like to see high LTV ratios. So they may charge you with higher interest rates if your LTV ratio is above ?. That’s why we need to apply the necessary changes accordingly. You can also apply for FHA loans, they’re mostly designed for those whose credit scores are between 500-579. However, you’ll also need a 10% down payment to get the FHA loan.

The last thing we want to emphasize is that you can apply for VA housing loans or USDA loan programs. VA housing loans are for service members such as veterans or surviving spouses whereas the USDA loan program is for those with low or moderate income in specific rural areas. You can also consider these and keep this information in your toolbag until you seize an opportunity to use this information.

Conclusion

Finishing our words we once again want to thank you for reading and being part of this amazing community. We can easily confer from what’s been written that you need to improve your credit score continuously. We gave you some useful tips and clues to use for your future projects. But just like education depends on the student, realizing these useful tips depends on you. That’s why no matter how hard we try to share these valuable tips, you need to apply them to your life.

Only this way you can manage your life easier and achieve your long-term vision. Of course, this is neither the beginning nor the end for us. We’ll be here with our brand new topics every month to ensure and assure that you are going smoothly on the right path. If it weren’t for the belief in our readers and followers we wouldn’t be coming up with new researches every month. We highly believe in your potential, we also know that you feel the same for us. Because of this motivation, we’ll diversify our content continuously. See you soon and take care.

“If you have any feedback about ways to buy a house with bad credit that you have tried out or any questions about the ones that I have recommended, please leave your comments below!”

NB: The purpose of this website is to provide a general understanding of personal finance, basic financial concepts, and information. It’s not intended to advise on tax, insurance, investment, or any product and service. Since each of us has our own unique situation, you should have all the appropriate information to understand and make the right decision to fit with your needs and your financial goals. I hope that you will succeed in building your financial future.

Considering our previous contents and helping you define your needs and necessities was one side of the coin. But also in our life span, there are certain times that we all think buying a product and bringing value to those we love with these products is inevitable. More specifically, considering the fact that you’ll be married to a person you love for a long time, we need to calculate every obstacle that might be challenging on the road for you. That’s the reason we’ve come up with this topic today to give you more insightful and comprehensive knowledge compared to various articles online.

But before we start you need to keep in mind that this situation can’t be applied to everyone. Of course, beauty is in the eye of the beholder and there’s no accounting for taste. But still, we’ll try to give you the best taste you can find when it comes to shopping habits and options. On the other hand, the decision is completely yours and we’ll respect every move you make on the road as long as you learn to be stable and abstain from extravagancy during your financial independence journey.

Before we begin let’s first learn how much people spend on an engagement ring, and beware of the public opinion when it comes to spending money on an engagement ring. Statistics show us that the average engagement ring cost is somewhere around $5900, and a good number of survey respondents said they spent less than $1000. More recently in the 2020 Brides’ American Wedding Study, couples reported spending an average of $3756 on an engagement ring, which is more than $2000 less than the average 2019 price tag above.

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Looking into these statistics you can make your own calculations regarding your decision-making process. if you want to buy one, it’s always better to check what is the general idea about our research and where we can find valuable information that will affect our decisions on how much to spend on products like an engagement ring. Besides, we’ll not depend on general assumptions, like 2 or 3 months of salary. Basically, it’s a thesis that if you want to buy an engagement ring you should spend at least 2-3 months of your annual salary. But reading us for a long time you’ve proved that we abstain from stereotypes. Finding our own excitement for studying different sources and researches is what we want to achieve in the long run. This is the mindset that we’ll have continuing our studies if you remember our previous articles.

If everything is clear up till now, we can move on with our main question How much should be spent on an engagement ring?

Firstly we should be well aware that it’s up to your incomes and costs. There’s no specific amount to be called because everybody’s income differs. That’s why speaking of the products like engagement rings we all need to be aware that there’s no specific product to be bought and there is no specific amount of money to be spent on these products.

What should we do then? this question is answered well with the finance. Firstly if you want to present a meaningful gift to your beloved one you should make every necessary calculation on the road. You should take care of your spendings and try to expand your income channels. This way buying the best engagement ring will not put any burden on you. In order to achieve that we need to continue our studies and expand our knowledge of finance as usual. In order to realize that you should buy a meaningful gift, not an expensive one. Only then you can apply what you learned to real-life circumstances.

Secondly, One of the methods you can use to buy this meaningful gift is that you can set aside cash every week for a year to buy your gift. If you use your credit card or borrow some money from your friends to buy an expensive gift, that means you don’t apply the things reading our content into real-life circumstances. In order to apply them our formula is to have patience at first and then put our plans into practice accordingly.

When we say that you need to have patience for the long term, of course we know that it sounds limiting in the beginning. For most of the people out there it’s harder to take the bitter pill in the beginning. But we’re 0 sure that this approach will bring you more benefits than being impatient. Based on our experience we can easily say that and share this approach with you. We believe that you’ll fulfill them in your life. Because it’s important for our long-term vision.

Besides, it makes almost no sense to start your marriage deeply in dept. That’s why we believe and hope that you’ll listen to the advice here. Because they are there to improve you and contribute to your well-being.

Conclusion

Finishing our words we once again want to thank you for your attention and concentration. You’re contributing a lot to us by reading our online content and pushing us to come up with more creative articles every time you present your feedback. So thank you for your continuous support. When you make yourself enthusiastic and get ready for our upcoming articles, it pushes us to create more meaningful information for you. Of course, buying an engagement ring is the topic one of the readers has requested, that’s why we have tried our best to educate you depending on the topic. But always keep in mind that our vision is for the long term.

That’s why abstaining from extravagancies is what will improve our understanding and comprehension of finance in the long run. That’s why our advice for you is that take the bitter pill, save money and continue reading our articles. Because we’ll come up with even better and more striking topics in the following weeks.

“If you have any feedback about how much should be spent on an engagement ring that you have tried out or any questions about the ones that I have recommended, please leave your comments below!”

NB: The purpose of this website is to provide a general understanding of personal finance, basic financial concepts, and information. It’s not intended to advise on tax, insurance, investment, or any product and service. Since each of us has our own unique situation, you should have all the appropriate information to understand and make the right decision to fit with your needs and your financial goals. I hope that you will succeed in building your financial future.