Shortly after I pressed the “pause” button on my teaching career and began staying home with our littlest one, I began to look for ways to earn money. When I started this journey, I was naturally drawn to work-at-home jobs within the field of education. A few minutes into my search, and I was amazed […]
The post Work From Home Scoring Test Papers Online appeared first on The Work at Home Woman.
Parents, you want the best for your kids. You don’t want them stumbling through life, struggling financially and figuring everything out on their own, do you?
No!
That means talking to kids about money at a young age and teaching them how to properly manage it.
The Penny Hoarder recently conducted a survey of over 1,500 people on the topic of financial literacy and found one-third did not learn basic personal finance concepts growing up. You don’t want your kids to reach adulthood oblivious to how to earn and save money.
Among Americans who did discuss money growing up, only 17% have no savings and 18% earn less than $50,000. But among those who did not gain early financial literacy, 40% have no savings and 31% earn less than $50,000.
Children start developing financial habits at an early age, so don’t wait until high school to talk about money with your kids. If they’re already teens, that’s OK. There’s still plenty of opportunity to teach them how to earn money, spend smartly and save for the important stuff.
Earning, spending and saving are the three main components of budgeting. Here’s how to get your children to grasp those concepts.
It doesn’t just magically come out of an ATM either. It’s important that kids understand how to earn a buck.
Allowance can be a touchy subject for parents. Some don’t believe in rewarding kids for work they ought to do as members of the household. Others just don’t have the funds to give money for chores.
An allowance, however, can help children make the connection that money is given in exchange for work.
It doesn’t have to be a lot. You can start off rewarding your little ones with $1 a week for setting the table or sweeping the floor. Or you could choose to only pay your kids for chores that go above and beyond everyday household work, like mowing the lawn or washing the car.
Another way your kids can learn that working pays off is by giving them money for earning certain grades in school.
From lemonade stands to babysitting, there are plenty of ways kids can earn their own money. Lean into their interests and use them as a way to inspire your kids to become entrepreneurs.
Caroline and Isabel Bercaw loved using bath bombs and were just 10 and 11 years old when they decided to make and sell their own at a local art fair. Less than three years later, they were approached by Target to sell their bath bombs in its stores, and Da Bomb Bath Fizzers grew into a multi-million dollar company.
Your children don’t have to turn their entrepreneurial pursuits into million-dollar businesses. Maybe they just rake leaves for neighbors or tutor other students to earn some spending money.
Once they’re old enough to legally work in your state, your teen can find part-time or seasonal work as a way to earn an income. Retail, food service and theme parks are employers that often hire teenage workers.
Talking about salaries and income disparities can be an awkward conversation. But raising kids pretty much guarantees you’ll have to tackle an awkward conversation or two.
You’ll probably want to wait until your children are older, but talk to them about expected salary ranges, job growth and the various roles a person can hold when you discuss career ambitions. It’ll help establish an idea of the kind of lifestyle they’ll be able to afford in the future.
Of course, money isn’t everything, so don’t crush their dreams by saying they’ll starve if they pursue a career in the arts.
The Bureau of Labor Statistics’ Occupational Outlook Handbook is a great resource for your teen to research average salaries and different jobs in their field of choice.
A huge part of budgeting is learning how to smartly spend. That means teaching your kids not to grab everything they like in the store.
Recognizing the difference between needs and wants is something even adults struggle with. Nevertheless, you should try to serve as a positive example and include kids in conversations about household spending.
When you’re grocery shopping, point out how buying chicken, rice and green beans is more important than getting treats like ice cream or chips. During back-to-school season, share how getting notebooks and pencils is a priority over locker decor. You might also explain why saving up for a new car for the family means you have to forgo a summer trip this year.
Another approach is to have your kids contribute a portion of their allowance for household essentials. One mom’s Facebook post went viral last year after she charged her 5-year-old for needs like rent and electricity to introduce the concept of having to pay bills.
Having a little money to spend might give your kids tunnel vision about buying something they want. Instead suggest ways your children can get more bang for their buck.
Point out prices in the toy aisle. Ask your child whether he’d rather get that $15 toy he noticed first or choose two similar items costing $7 each. Go over sales catalogues, and introduce the concept of couponing.
Before they spend all their savings on something frivolous, ask your kids to reflect on what they had to do to earn the money. Challenge them to wait a week before buying something on impulse.
Kids will make a stronger connection to exchanging money for goods and services if they’re the ones actually making the exchange.
If they want to go out for ice cream, help them count out bills and coins from their piggy bank and let them hand the money over to the cashier.
As your little ones grow, get them a wallet or purse to hold their money. Place them in charge of buying lunch at school rather than adding money to their account online.
There are even ways to include your kids in the cashless economy. Companies like FamZoo, GreenLight and BusyKid offer kid-friendly debit cards.
Some parents choose to add their teens as an authorized user of their credit cards, which establishes a credit history for them and has the potential to strengthen their credit scores.
The CARD Act of 2009 restricts consumers under 21 from applying for credit cards on their own without stable income.
If you go this route, make sure to teach your teen about the consequences of charging what you can’t afford on credit. Use parental controls for online accounts where you have credit card information stored, such as Amazon, and regularly check your credit card purchases.
Spending is not limited to buying things for yourself. It’s good practice to put money aside for giving, whether that’s donating to charity, tithing at church or buying gifts for others.
Giving teaches children to think beyond themselves and to develop a philanthropic spirit. Many money experts recommend teaching children to budget by splitting their money into three jars — one for spending, one for giving and one for saving, which we’ll discuss next.
Kids don’t want to wait for what they want. They want it now. Right now.
Help them learn to fight the instant gratification urge and save their money.
Saving money isn’t the most exciting thing in the world, but you can liven it up for your kids (and yourself too).
Take a visual approach to tracking savings. Have your kid draw something that represents what she’s saving for — like a music note for concert tickets. Each time she saves money, have her shade in a portion of the image.
Turn saving money into a challenge by having your kids drop money into a jar and reward them when they fill it up. Or tap into sibling rivalry by having them compete with their brother or sister for bragging rights on who can save the most the quickest.
You can also create a game out of finding coupons or deals. Reward your kids with a portion of the savings they discovered.
Piggy banks are great savings tools for young kids, but a savings account introduces them to the banking industry.
Whether you choose to open an account at a brick-and-mortar bank, credit union or online bank, make sure to review the monthly statements with your kid. Discuss how their money can grow with interest by keeping it in the account.
Make sure to point out any account maintenance fees or limitations on withdrawals — and the consequences that come with surpassing those limitations.
College is one of the most expensive costs you’ll face as a parent. (Though day care expenses can rival that.) The upside? You have about 18 years to save up.
Involving your children in discussions about saving for college helps them become aware of the magnitude of investing in a degree. It may also open up conversations about alternatives to the ultra-expensive private universities on your kid’s top school-choice list.
Some parents have their kids contribute to the cost of college. If your teen has a part-time job, he can save a percentage of his earnings in a college fund.
Get other family members in on the goal of saving for college by asking them to contribute to your kid’s 529 college savings plan in lieu of gifts for holidays or birthdays.
When you’re teaching kids how to budget, injecting fun along the way is a must.
Younger kids may enjoy dropping coins into a piggy bank or reading a book like “Curious George Saves His Pennies.” Several kids’ museums across the country have exhibits geared toward shopping or banking.
Older kids might pick up a financial lesson from board games like The Game of Life or Monopoly. This list of money-themed presents for kids make for good gift ideas all year round.
The Federal Trade Commission has various videos and online games, including this one geared to kids about how to be a smart consumer at the mall. Jackson Charitable Foundation has a series of kid-friendly music videos about money that cover concepts like earning and spending.
Getting your children involved in a finance-focused organization like Junior Achievement is another way to make learning about money interesting.
The National Endowment for Financial Education’s High School Financial Planning Program has resources for parents to talk to their teens about money.
For more advice on teaching your kids about budgeting and personal finance, check out these books:
Nicole Dow is a senior writer at The Penny Hoarder. She’s a parent who plans to teach her daughter all the things she didn’t learn about money growing up.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
Obtaining a mortgage can be one of the most stressful and exhausting parts of the homebuying process.
Since the subprime housing crisis and the market crash that kicked off in 2007, mortgage applications and reviews have been more detailed and rigorous than ever, requiring seemingly endless paperwork and extensive income verification.
There are also many variables to consider when shopping for a mortgage that can impact the success of the entire process and ultimately how much you spend — not only to obtain the mortgage, but on your home over the long run.
To help first-time homebuyers navigate all of these hurdles successfully, we asked mortgage industry experts to share their top tips for obtaining a mortgage.
First things first: Given all the documentation requirements associated with the mortgage process, do yourself a favor by getting your financial paperwork in order at the outset, says Chase home lending advisor Michele Hammond.
Key items to pull together include recent pay stubs, tax returns, W-2s from your employer, and bank statements from all savings and checking accounts, as well as from any investment or retirement accounts.
You’ll also need to provide a Form 4506-T, which is an Internal Revenue Service (IRS) document used by lenders to retrieve past tax transcripts that are on file with the IRS, said Hammond.
Self-employed applicants will need to provide two years of tax returns and their most recent profit and loss statement showing revenues, costs, and expenses during a fiscal year.
In addition to merely gathering paperwork, it’s a good idea at this stage to get yourself in top financial shape so that lenders view your application more favorably, adds Hammond.
Improving your financial profile involves a variety of elements. For starters, avoid carrying excessive debt.
“Your debt-to-income ratio is an important factor that lenders consider when looking at your fitness for a loan,” Hammond explained. “Reducing debt can make your finances look more attractive.”
To assist with minimizing debt, eliminate any unnecessary monthly expenses beyond housing, Hammond continued. Use the freed-up money to pay down debt or increase your down payment for the home, both of which could put you in better shape when it’s time to apply for a loan.
Reviewing your credit score and history is another key effort. If your credit score needs improvement, try making multiple or frequent payments on a credit card during the course of a month, suggests Hammond.
“If you pay on time and consistently, your score should reflect that,” she said.
One additional suggestion from Hammond on this front: If possible, avoid changing jobs while applying for a mortgage.
“Lenders look for job stability when they evaluate your ability to repay a loan,” Hammond explained. “If you must switch jobs while applying for a mortgage, be sure your new base salary qualifies you for the same loan amount. And keep in mind that only your base earnings count toward your income until you can produce at least, two years bonus history.”
Reviewing multiple lenders, or mortgage shopping, is a critical step — and it’s one that many first-time home buyers often neglect, instead taking the first lender recommendation they receive or mortgage quote obtained.
“You never want to settle on the first lender you talk with,” said Andy Harris, president of CRMS, Vantage Mortgage Group and Association of Independent Mortgage Experts. “Buyers don’t realize how different the terms are that vary from company to company – even if the loan type is a commodity, pricing is not.”
When talking with different lenders and mortgage brokers, it’s important to get quotes on the same day for an accurate comparison, Harris added.
While daily market rate changes will impact all lenders uniformly, the actual rates they offer borrowers will vary based on other factors as well.
“This is relating to their own overhead costs or other items that impact their overall pricing that they offer,” Harris continued. “So, for example, if you’re comparing two companies on the same conventional 30-year fixed loan on the same day, one might quote a fee of $2,000 at a specific rate. While at that same rate, another is offering a credit of $2,000. That would be a $4,000 direct difference in cost for the same conventional 30-year fixed loan.”
When shopping around, be sure to include a local, truly independent mortgage broker in your search, someone who’s experienced and accountable, added Harris, as such an individual can shop wholesale lenders on your behalf and work directly for you.
Matt Hackett, an operations manager of Equity Now, a direct mortgage lender, suggests applying with a minimum of three lenders, which will give buyers a true sense of the market.
“Compare them to see where you can get the best deal,” said Hackett.
First-time home buyers often get caught up in the more appealing parts of the process — shopping for their dream home — and neglect to get preapproved for a home loan. But doing so early on can prevent disappointment later.
“It’s more than heartbreaking when you find the perfect home, then find out it’s outside your budget. Getting fully preapproved supports your successful experience,” said Nicole Rueth of Fairway Independent Mortgage Corporation.
“Work with a lender who will help you differentiate between your maximum qualification, determined by your income and your debts, and optimal budget. A common regret for first-time homebuyers is that they maxed out their qualification and now have a mortgage payment that limits other opportunities.”
It’s also important to keep in mind that there are various levels of pre-screening for a mortgage, noted Ryan Richardson, a licensed mortgage loan officer for Pennsylvania-based Movement Mortgage. Simply getting prequalified is the most basic step, but it’s only designed to give you a loose idea of what you can afford.
“This is a buyer verbally telling a loan officer what their income, assets, and liabilities are and oftentimes no documentation is collected to verify any of it,” explained Richardson, who says this limited review doesn’t do anyone any service.
“It sends someone shopping for a home based on good guesses,” said Richardson.
Getting preapproved, on the other hand, takes the review a step further, typically requiring the home buyer to submit pay stubs, W-2s, and bank statements. A letter of preapproval from a lender also shows sellers that you’re a serious buyer with financing in place.
“The loan officer has more solid information to determine what you can afford,” Richardson explained. “I would recommend this as a bare minimum before shopping, this avoids heartbreak further down the line when you have a more solid idea of what you can and can’t do.”
As part of the mortgage shopping process, you’ll likely be getting interest rate quotes. However, keep in mind that an interest rate is not guaranteed until it’s locked in. And typically, you can only lock in or guarantee an interest rate once you’ve a signed agreement of sale that includes an agreed upon settlement date, explained Richardson.
A mortgage rate lock, however, is an agreement between a borrower and a lender that allows the borrower to lock in an interest rate for a mortgage over a specified period of time. In other words, the rate will stay consistent, even if the market changes. Lock periods range from 15 days to 45 or even 60 days, and lenders may charge a lock fee.
“Rule of thumb is the longer the mortgage company locks, or guarantees your rate, the more expensive it is going to be,” said Richardson. “For instance, a 60-day lock is going to be more expensive than a 30-day lock, because the mortgage company is guaranteeing something for a longer period of time.”
There is a downside to locks to keep in mind. If the market changes and rates decrease after you’ve locked in, you generally won’t be able to take advantage of the lower rates.
A home is one of the biggest purchases most people will ever make, so it’s important understand what you’re getting into.
Having a basic grasp of mortgages and all of their variables will save you money and heartache, said Jennifer Beeston, of Guaranteed Rate Mortgage.
“Read and watch videos online about the mortgage process and options. Know the difference between a fixed rate and an adjustable-rate mortgage, and what points are. All this info is online and it is free,” she said.
And one last step – research your individual loan officer.
“The actual person doing your loan is critical. Just because a company has a good name or does a lot of loans does not mean the person doing your loan is good,” said Beeston. “Look for third-party reviews of the person who is your loan officer.”
Read more:
Mia Taylor is an award-winning journalist with more than two decades of experience. She has worked for some of the nation’s best-known news organizations, including the Atlanta Journal-Constitution and the San Diego Union-Tribune.
The post Tips for Getting a Mortgage appeared first on The Simple Dollar.
