How to Invest $20,000

So, you want to invest $20,000. That’s a chunk of change!

If you want to invest your money wisely but don’t know where to start, you’ve come to the right place.

I’m going to show you how to invest that money based on your current attitude toward investing.

So, whether your primary goal is to make sure your money is safe and sound or it’s to earn as much money on your money as possible, read on, soldier.

Investing $20,000 is serious business, and I have the answers you seek.

 

Which of the following statements best reflects your situation?

“I’m in consumer debt up to my eyeballs and I’m not sure I should invest.”

Your hunch is a good one. You shouldn’t be investing yet, my friend.

How much consumer debt do you have? If it’s under $20,000, consider using your stack of cash to pay off the debt. If it’s over $20,000, you just might want to consider using it all. Just make sure you have somewhat of an emergency fund before you do.

Debt is like the anti-investment. And unfortunately, it’s quite a bit worse than that – debt almost always comes with a guaranteed condition of interest that you would owe to the lender. You see, your investments could go up or down in value. With debt, you’re almost always going to pay more than what you borrowed.

Sad day.

The good news is that you can “invest” that $20,000 by throwing it toward your debt. Think of it as a surefire way of not paying any more interest on that amount of debt. Boom. You just saved yourself quite a bit of money.

Want to further your cause to pay off debt? Try these online tools.

“If an emergency happened, I’d need the money like, now!”

On a risk scale of 0 to 10, with 0 being a little risk and 10 being a lot of risk, you’re probably going to land at -15. No worries. We can work with that.

You have $20,000 to invest but you don’t want to lose your money. Here are some options I’d recommend . . . .

High-Yield Savings Accounts

Ah, the beauty of simplicity. High-yield savings accounts allow you to earn a low rate of return (when compared to stocks and bond investing, for example) while ensuring that unless armageddon comes, your money will be safe.

Why are they called “high-yield” when you earn a low rate of return? Well, they earn more interest than most savings accounts on the market.

These types of accounts are great for saving emergency fund money – or any money you don’t want to disappear overnight. These accounts are also great to use after the loss of a loved one when you’re emotional and are more prone to make poor investing decisions.

If you feel this is the right type of account for your 20 grand, click here to check out some of my favorite high-yield savings accounts.

Money Market Accounts

These accounts are crazy boring, my friend. Yawn.

But the good news is that money market accounts are stable and sometimes offer the same protections as their savings account counterparts. Check with your local bank or credit union to see if they offer a money market account.

How about the interest? You’ll probably earn less than or equal to the amount you would with high-yield savings accounts. Still, if this kind of account is available to you and you need quick access to the money in case of an emergency, this is a good option.

“I’m don’t anticipate needing the money anytime soon and I don’t mind risk.”

Sweet. You’re in a good position to make some serious money.

I would recommend you do some traditional investing either yourself or with the help of a professional. Let’s take a look at both options . . . .

Invest Yourself

There are a number of ways you can invest yourself into a long-term portfolio. I’d only encourage you to do so, however, if you know what you’re doing. Even when you’re investing using automated, passive techniques, you might find yourself lacking the degree of financial planning necessary to reach your goals. You’ve been warned.

Okay, so you still want to invest yourself. One way to do so is to use Betterment. Betterment is a pretty nifty way to invest online in a mixture of stocks and bonds based on the degree of risk you can stomach. If you’re the kind of person who doesn’t mind risk, you’ll find that Betterment will recommend more stocks than bonds – and rightly so. Betterment automates investing and rebalances your portfolio based on preprogramed protocols constructed based on expert advice.

With Betterment, you will pay a low assets under management fee. If you want your $20,000 to be automatically invested without much input from you, it’s worth it.

If you want to fine-tune your investing, don’t go with Betterment. Instead, open up a Scottrade account. It’ll only take 10 minutes of your time and you’ll be able to select the exact investments you want to add to your portfolio – and in what proportions. Scottrade offers some pretty cheap trades but you’ll need to do your own investment research to discover the best strategy for you.

Invest With a Financial Advisor

If investing $20,000 in a portfolio on your own doesn’t sound like a walk in the park, consider working with a financial advisor.

A financial advisor can help you come up with a comprehensive strategy to reach your goals. But please, please! I beg you! Don’t just hire anyone!

Some financial advisors are out to practically rob you. In fact, if you haven’t read my story of the woman who was duped into paying over $3,500 in variable annuity fees and didn’t know it, read it now.

Hire someone you trust and do your own homework too. You should understand the investments being proposed before you plop down your $20,000. Invest your money wisely by making sure your financial advisor knows what they are talking about.

If you want someone who will be honest with you, teach you, and won’t settle until you fully understand what you’re investing in, work with me.

“I’m adventurous and would love to try out some alternative investments.”

There’s a little secret many financial advisors won’t tell you. But you know what? I will.

Here’s the secret: You don’t necessarily have to invest using traditional investments like stocks and bonds and mutual funds. There are other ways to invest your money.

If you’re the adventurous type and would like to invest your $20,000 in some alternatives, here are a few options . . . .

Peer-to-Peer Lending

Peer-to-peer lending is a great way to invest money by loaning it to others. There’s certainly risk involved, but my experience with peer-to-peer lending is that it can provide a pretty stellar rate of return.

If you’d like to learn about peer-to-peer lending, I recommend that you check out Prosper and Lending Club. Also, be sure to read all about my huge experiment I conducted putting both services to the test.

Educate Yourself into a New Career

That $20,000 can be used to invest into your education. Education, my friend, can turn into a lucrative career.

You may not have thought about the possibility of investing into your education, but that doesn’t mean it’s a bad choice. In fact, when you consider the return on your investment, you might make many times more than if you were to put the money into the stock market.

Investing in yourself is rarely a bad idea. The only time it might turn into financial waste is when you don’t use the education you receive to pursue a new career and actually land the job. That’s a risk, though, that’s usually worth taking.

“I’m entrepreneurial and creative. Seriously, I am. What should I do?”

You’re my kind of person. Here are some ways you can invest your money and have fun doing so . . . .

Start an Online Business

Now, you may not be able to buy a building and start a restaurant with $20,000. But you know what? That kind of money would take you pretty far if you were to start an online business.

In fact, I’ve started an online business and boy has it paid dividends. I would highly recommend you learn how to start a blog and put your money to good use.

You can use the money to have a professional web designer work on your website or you could pay a few writers to craft some informative pages for quick and easy reference for your readers. Really, the sky is the limit.

Become a Freelancer

You might even consider becoming a freelancer and buying some quality equipment for your business. Perhaps you love photography – invest in a great camera! Maybe you enjoy fishing – buy some extra rods, fishing gear, and become a river guide! $20,000 will take you quite far into starting your own freelance business.

“I’m not sure what I should do – even after reading this article.”

Don’t fret. It might just be time to flex your brain muscles and discover new opportunities. If you’re clueless on how to do that, here are some ideas . . . .

Pause and Wait

If you’re not sure how you should spend your money, please don’t until you’re absolutely sure. Like I mentioned, you can park your money in a high-yield savings account while you figure out your options. It’s better to do nothing than to make a grave mistake.

Start Here

If the thought of investing your money absolutely terrifies you, don’t invest yet. Click here to read all about The Money Uprising Movement™ and get a game plan for how you deal with money. Over time, as you practice these rules, you’ll gain the confidence you need to move forward.

I believe in you. That’s why I put this information out there – I believe you have what it takes to learn how to invest with confidence and manage your money better than ever. You can do it, and I’m here for you.

Source Good Financial Cents http://ift.tt/1Uc0VaE

New Year’s Resolutions: Six Ways to Hack the 52-Week Money Challenge

New Year’s is nearly upon us, and with it the chance to start fresh and make some changes in our lives. The most common New Year’s resolution is to lose weight or get in shape, but many of us will devote 2016 to saving more money (or spending less of it).

Whatever your resolution, getting and staying motivated is critical to achieving it. Your core motivation really needs to come from within, but one of the simplest ways to augment that is to make a game out of whatever it is you’re doing. (Credit card companies, retailers, and apps have known this for years, and that’s why they get us to rack up “points,” earn rewards, and reach new levels.)

We simply love keeping score and feeling like we’re making progress toward a goal. And that explains the popularity of one game many people use to help them save money: The 52-Week Money Challenge.

The 52-Week Money Challenge

The idea is simple: You start by socking away just $1 in the first week of the year, and then gradually increase your savings by a dollar a week throughout the year. So you save $2 in Week 2, then $3 in Week 3, and so on, until you’re stashing away upwards of $50 a week next December.

By the end of the year, if you complete the challenge, you’ll have saved $1,378.

Week No.	Deposit Amount	Total Balance
Week 1	$1.00	$1.00
Week 2	$2.00	$3.00
Week 3	$3.00	$6.00
Week 4	$4.00	$10.00
Week 5	$5.00	$15.00
Week 6	$6.00	$21.00
Week 7	$7.00	$28.00
Week 8	$8.00	$36.00
Week 9	$9.00	$45.00
Week 10	$10.00	$55.00
Week 11	$11.00	$66.00
Week 12	$12.00	$78.00
Week 13	$13.00	$91.00
Week 14	$14.00	$105.00
Week 15	$15.00	$120.00
Week 16	$16.00	$136.00
Week 17	$17.00	$153.00
Week 18	$18.00	$171.00
Week 19	$19.00	$190.00
Week 20	$20.00	$210.00
Week 21	$21.00	$231.00
Week 22	$22.00	$253.00
Week 23	$23.00	$276.00
Week 24	$24.00	$300.00
Week 25	$25.00	$325.00
Week 26	$26.00	$351.00
Week 27	$27.00	$378.00
Week 28	$28.00	$406.00
Week 29	$29.00	$435.00
Week 30	$30.00	$465.00
Week 31	$31.00	$496.00
Week 32	$32.00	$528.00
Week 33	$33.00	$561.00
Week 34	$34.00	$595.00
Week 35	$35.00	$630.00
Week 36	$36.00	$666.00
Week 37	$37.00	$703.00
Week 38	$38.00	$741.00
Week 39	$39.00	$780.00
Week 40	$40.00	$820.00
Week 41	$41.00	$861.00
Week 42	$42.00	$903.00
Week 43	$43.00	$946.00
Week 44	$44.00	$990.00
Week 45	$45.00	$1,035.00
Week 46	$46.00	$1,081.00
Week 47	$47.00	$1,128.00
Week 48	$48.00	$1,176.00
Week 49	$49.00	$1,225.00
Week 50	$50.00	$1,275.00
Week 51	$51.00	$1,326.00
Week 52	$52.00	$1,378.00

The beauty of the challenge lies in its simplicity and the habitual momentum it can create — not to mention the big chunk of change you’ll end up with. It’s a simple, effective way to build your first emergency fund or to save up for next year’s big winter vacation. And unlike so many financial endeavors, getting started isn’t at all intimidating — just about anyone can manage to save one dollar in a week.

The problem? Well, as Trent has pointed out, you’re stuck saving $50 or more per week in December, which is already a pretty expensive month for most of us.

How to Hack the 52-Week Money Challenge

One way people get around that problem is by printing out the chart and crossing off the weeks in whatever order they fulfill them.

So if you got a big year-end bonus or cash Christmas gift, you could start with a $52 contribution right off the bat, and cross that week off the list. Then you could put in $10 the next week, or $22, or whatever amount you can comfortably spare, and work upward from there. That way, you’ll save a few low-dollar “gimmes” for those inevitable cash-strapped weeks later in the year, ensuring you don’t fall off the wagon entirely during a tough stretch.

But that’s hardly the only variation. Here are five other ways to customize or overhaul the idea of the 52-Week Money Challenge to suit your own lifestyle and motivations.

Let the Machines Handle It

One of the hardest parts about saving money is making the conscious decision not to spend those dollars on fun, fleeting things, and instead to stick them in a jar or a savings account. That’s why we’re relentless advocates of automating your savings — it allows you to make better financial decisions without even thinking about them.

Most big banks have sophisticated online and mobile banking platforms at this point that allow you to set up automatic deposits on whatever schedule you want — every Friday, or every payday, or whatever works for your schedule. Some of them even allow you to authorize transfers via text message, making it easy to stick to the challenge.

The other tricky part about saving money in, say, a piggy bank, is actually having the cash on hand to stuff in there each week (and resisting the urge to take it out when you want it a couple of months later). That’s why, unless you work for tips or in a cash-based business, most financial pros recommend setting up a high-interest savings account online, so you can automatically deduct money and stash it where you won’t spend it.

Either way, if you find your bank wanting in the technology department, there are plenty of slick banking apps that make this process even easier, including Digit and Qapital.

Qapital even has a 52-Week Money Challenge option built in. Yet that’s not the coolest thing you can do with the app. Since Qapital plays well with other apps and devices — such as a FitBit, Foursquare, Instagram, or your phone’s GPS — you can set up almost any “savings rule” imaginable that will transfer money into your savings account based on your behavior.

For example, you can set the app to make a small transfer into savings whenever you walk 1,000 steps or jog a mile. You could basically create your own walk-a-thon fundraiser: Pledge yourself 25 cents or $1 for every mile you walk next year. Or you could set up a virtual “toll booth” for yourself, where the app automatically transfers $2.50 into your savings account every time you cross a local bridge or pass a particular exit on the highway.

At the very least, using an app or automatic savings schedule can make the 52-week challenge a little less challenging.

The Monthly Money Challenge

If your goal is simply to establish some fiscal discipline and save roughly $1,400, there’s no reason you have to do it weekly, nor with the bulk of the burden hitting you in the heart of the next holiday season.

Set up an automatic savings deposit for $100 a month. Then, each month, kick it up by $5 (or $10). For example, save $100 in January, $105 in February, $110 in March, and so on. By next December, you’ll be saving $155 a month and sitting on a balance of $1,530. (If you use $10 increments, you’ll have $1,860 saved up.)

104-Week Challenge

Why stop after Week 52? After all, the whole point of the challenge is to develop a steady savings habit. If you were to keep ratcheting up your savings by just a dollar a week into the next year, you’d save up another $4,082 by the end of the second year – or about $5,500 total over two years.

Likewise, advanced savers or high earners who already have a substantial emergency fund may chuckle politely at the notion of saving just a few dollars a week in the early going. If you’re already an accomplished saver or have a more aggressive target in mind, up the ante a bit: Start at $100 a week and increase your contributions in $2-a-week increments.

Get Competitive

Qapital’s app also allows you to share a savings goal with someone. So, for example, if you and your spouse are saving up for a trip or a down payment on a house, you can each contribute to the same goal – and egg each other on.

Competition is a terrific motivator for many people. Want a real 52-week challenge? Set up a shared goal together and see who can save the most money toward it this year. Winner gets the window seat on your next big vacation.

Combine New Year’s Resolutions

Among Americans making resolutions this New Year’s, 12% are resolving to lose weight in 2016, according to a Marist College survey, while 9% are determined to exercise more and another 9% aim to improve their overall health. Meanwhile, 7% will try to spend less or save more money.

For those of us looking to do all of the above, Qapital’s saving rules come in handy. The app uses IFTTT (“if-this-then-that”) functionality that integrates with popular apps and social media platforms to make logic-based connections between your actions and your money. So, for example, you could have the app save $2 for you anytime you tweet or post an Instagram photo with a certain hashtag.

More helpful in terms of getting in shape, you can set it to transfer $5 into your savings account every time you check in at the gym on Foursquare, or every time you go for a run. Or, you can fine yourself a few bucks every time you splurge on a treat at Starbucks or eat at a fast-food joint.

The Marist poll also found that 10% of people making New Year’s resolutions had vowed to find a better job in 2016. Qapital connects to productivity apps like Todoist, so you can automatically deposit a few dollars into savings every time you cross off an item from your to-do list — such as sending out a resume.

Another 9% of those surveyed say they’ll try to quit smoking in the new year. If you always buy cigarettes at the same convenience store, set up a “cigarette tax” on yourself so that anytime you make a purchase at that store, you’re forced to dump $10 into savings. (Or try a brutal $100 fine if you really need some fast motivation.)

The combinations are certainly vast, if not endless, and can turn the dull saving process into a fun game. (If you come up with any cool ideas for a savings rule, let us know in the comments.)

It’s Not How You Save – It’s That You Save

For some people, especially the many young Americans who have little or no savings whatsoever, the 52-Week Money Challenge offers the straightforward game plan and motivation necessary to help them start saving. But it’s certainly not the only way to do it.

In the end, whether you’re building your first-ever emergency fund or saving for a down payment on a car, it doesn’t really matter whether you use the 52-Week Money Challenge, some variant of it, or a completely different tactic to save more money in 2016. The important thing is that you start a routine of socking away some money for your own future, and that you stick to it.

Good luck, and happy New Year’s!

Have you tried the 52-Week Money Challenge — or put your own spin on it? What are some savings rules that would get you to save more?

Related Articles: 

• How to Save Money: 100 Great Tips to Get You Started
• Ring in the New Year with a Financially Smart New Year’s Resolution
• How My Cheese Addiction Taught Me to Automate My Savings

The post New Year’s Resolutions: Six Ways to Hack the 52-Week Money Challenge appeared first on The Simple Dollar.

Source The Simple Dollar The Simple Dollar http://ift.tt/1PqJX9u

Got a Starbucks Gift Card You Don’t Want? 8 Creative Ways to Use It

It happens every year.

You’re roped into a Secret Santa at the office. You receive cards and packages from clients, customers or colleagues. That aunt you only see once a year feels obligated to buy you a Christmas gift.

Whatever it is, you’ve got a Starbucks gift card (or a few) left over when the dust settles from the holiday madness…and you don’t even like their coffee.

In case you’re not the world’s biggest Frappuccino or Macchiato fanatic, here are a few creative ways to put that old standby gift to use:

1. Sell It

The easiest way to get use out of an unwanted gift card is to sell it to someone who wants it.

A gift card exchange site like Raise will help turn the card into money by connecting you with buyers looking for a deal. This is the best option if what you really need is cash. You can see what Starbucks gift cards are going for here.

The downside is you won’t get 100% of the value for the card. Buyers use gift card exchange sites to get cards for less than face value, and you may also have to pay a fee to the company running the site.

Of course, it was a gift; so, whatever cash you receive for that gift card is still free money to you!

2. Regift it

Regifting is one of my personal favorite penny hoarding tactics. It works especially well when you celebrate the holidays with several different groups of people across different dates throughout the season.

But if you’re organized, you can also save this year’s gifts and get a head start on next year’s shopping!

A Starbucks gift card could be just what you need to fulfill your own Secret Santa obligations, surprise the mailman or finish off a gift basket for your boss.

Just make sure whoever you give the card to, you know, actually does like drinking at Starbucks.

3. Use it to Purchase Last-Minute Gifts

Maybe the hard-to-shop-for person on your list doesn’t live near a Starbucks. (There are a few towns that haven’t quite been overrun. Yet.)

In that case, don’t give them the gift card directly. Instead, bring Starbucks to them.

Use the gift card to buy their favorite blend of Starbucks coffee or snacks they can’t get anywhere else.

For the coffee lover who isn’t in love with Starbucks, you can also find coffee-adjacent gifts like a mug, French press, biscotti or other treats. These are good for a small gift exchange, stocking stuffers or to fill out a gift basket.

4. Commit a Random Act of Kindness

If you didn’t meet your kindness quota with charitable giving over the holidays, now you can up your game without spending any money.

The Starbucks drive-thru made headlines in the past couple of years with patrons paying it forward — nearly 1,500 customers in one Connecticut Starbucks paid for the order of the car behind in them in a chain that spanned for days after Christmas.

When you hand over that gift card to buy your next cup of coffee, why not ask the barista to throw the next order on there, too? It will be a delightful surprise for the customer behind you — and, who knows? Maybe you’ll be the one to kick off the next newsworthy chain of kindness!

5. Buy Coffee to Donate

If you want to be more deliberate with your charity, buy coffee to donate to a local food bank.

Your one gift card might not buy a ton of coffee — a few bags — but every bit is appreciated.

If you or anyone you know has ever shopped at a food pantry, you’ll know how much of a gem a bag of Starbucks coffee would be. It’s exciting to find a popular product on those shelves, especially one that usually comes with a relatively high price.

6. Take a Potential Client Out for Coffee

Let’s get down to business. You might not want to drink Starbucks coffee, but I’ll bet you know plenty of people who do.

A coffee date is a wonderful networking opportunity, especially if you work from home. It will get you out of the house and away from your computer for real face-time with someone who might be interested in your products or services.

Make an impression by covering the check — and save yourself some money by using your gift card!

7. Buy Coffee for a Mentor for a Brain-Picking Sesh

In my experience, nothing is more valuable to professional development than a candid chat with someone who’s walked the road before you.

A busy professional, however, may not be thrilled if you simply ask to get together to talk. Their time is valuable, and they don’t want to give it to you for free along with all their trade secrets.

If you can offer to buy them coffee or lunch in exchange, though? That might grease the wheel a bit.

Use your gift card to fund it, so you don’t have to stress about the extra shots and soy milk they add to their latte.

8. Provide Coffee for the Office

A Starbucks fan is pretty adamant about their coffee of choice. Even those who only drink the drip coffee will go out of their way or show up late to a meeting in order to stop by the coffee shop on the way to work.

That’s because Starbucks coffee is unique. Diehard fans have an exclusive taste for it, and it can’t be replaced with just any drip coffee.

If you’ve got Starbucks lovers in your office, surprise them this week with a pound or two of their favorite coffee for the break room. Set aside the Folgers for a couple of weeks, and get your morning meetings started on time.

Your Turn: Did you get one too many Starbucks gift cards this year? What will you do with yours?

Disclosure: We have a serious Taco Bell addiction around here. The affiliate links in this post help us order off the dollar menu. Thanks for your support!

Dana Sitar (@danasitar) is a staff writer at The Penny Hoarder. She’s written for The Huffington Post, Entrepreneur.com, Writer’s Digest and more.

The post Got a Starbucks Gift Card You Don’t Want? 8 Creative Ways to Use It appeared first on The Penny Hoarder.

source The Penny Hoarder http://ift.tt/1NIbJfh