Are you stressing about money? On the BIGG Success Show, we share our favorite quotes about money in a way that not only offers insight, but also tells a story about how to overcome money problems. Find the show summary below.
Do you ever feel like the only time you find money is when you look it up in the dictionary? Seriously, we’re living through some tough times. For inspiration, we’ve put together a story in quotes. Let’s go to The Professor’s Whiteboard for 13 ways to overcome money problems.
As inflation continues to grow, people are looking for answers on how to manage their money. A lot of influencers on social media are encouraging a practice called “cash stuffing.”
What is it, and is this a good trend to follow? That’s our focus today.
We’ve all heard plenty of bad news recently, but the bad news now is that there is more bad news to come. While we must think about the opportunities in front of us, it’s also important to consider the threats to our careers and our finances so we can prepare appropriately.
Recession
Consumers, businesses, non-profits, and governments, all over the developed world, are learning a hard lesson about leverage. We will climb our way out of this recession but it will take some time. Before it’s through, it will be one of the, if not the most, severe recession since the Great Depression.
Layoffs will continue. In most recessions, layoffs occur mostly at the bottom of the earnings / education spectrum. Expect this recession to be more evenly distributed, if not hitting higher end jobs harder.
Outsourcing
Companies will continue outsourcing, but here’s the difference. Manufacturing jobs have been getting shipped overseas for some time now. As fuel prices rose, there actually seemed to be a resurgence in companies bringing manufacturing jobs back on shore.
Now more white-collar jobs are at risk thanks in part to technology that allows information to be shared instantly from any place in the world with internet access. We found a great article that discusses the characteristics of jobs that can now be easily outsourced and jobs that can’t. It also lists what you can do to make yourself less vulnerable and provides a list of jobs by their level of risk to offshoring.
Deflation
Expect deflation to continue as everybody keeps a tight lid on spending, the credit markets remain relatively tight, and inventories of everything from housing to cars remain comparatively high. The good news is lower prices will remain, but …
Inflation
Governments in the developed countries have poured money into the world economy at unprecedented rates. At some point, once the credit markets loosen up and demand returns, inflation could become a problem.
We’ve just witnessed prices on everything from gas to groceries rising quickly. We could see it again. It will take wise leadership to know when to slam on the brakes on economic stimulus without tightening so much that another recession ensues.
If this happens, that cash stash will quickly lose its value. Investments in hard assets have typically performed well in times of inflation.
Delayed retirement
A number of retirees are being forced to look for work after the freefall of their portfolios. Even more people who planned to retire soon are putting those plans on hold because they need to bulk up their assets again before they stop working. This will create even more competition in already tight job markets.
Benefits
Employers are under intense pressure to cut costs. It’s reasonable to expect them to cut benefits. Even if it’s promised now, don’t count on having health insurance provided to you as a retiree. Even while you’re working, expect to cover a greater share of the premiums.
Also don’t be surprised if your employer cuts back or eliminates the matches on your 401(k). These aren’t the only benefits at risk, but they’re two of the most significant ones.
Access to credit
It won’t show up on your personal balance sheet, but your credit score will be an incredible asset. Cash will be king as long as prices remain in a deflationary state. At some point, cash along with the ability to access credit will open doors for opportunities that most of us will never see again in our lifetimes.
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https://biggsuccess.com/wp-content/uploads/2020/07/bigg-success_stacked-1080.png10801080George Krueger & Mary-Lynn Fosterhttps://biggsuccess.com/wp-content/uploads/2015/07/BIGG-Success-Nurturing-Your-Inner-Entreprener.jpgGeorge Krueger & Mary-Lynn Foster2008-12-17 12:07:032021-01-24 00:44:38Top Threats to Your Career and Finances in 2009
There’s something that men seem to do better than women – accept more risk to earn a higher return.
Now granted, anytime we stray into generalizing about the sexes, or any other group, we risk over-generalizing. But long-standing research seems to support this notion.
Women may be too risk-averse. One of the basic tenets of modern financial theory is that taking greater risk should lead to greater rewards. Granted, it may be a rough ride with more volatility, but in the end it pays off.
Especially if you’re investing for the long-term.
Research shows that risky assets (e.g. stocks) overcompensate for the risk taken over long periods of time (e.g. five years). So if your investment horizon (i.e. the time before you’ll need the money) is five years or more, you can probably afford to accept more risk.
It can make a bigg difference. For example, let’s say that one 22-year old new college graduate invests $500 a month in stocks while another invests only in treasury bills. It’s not unreasonable to expect a 6 percent premium per year, after inflation, for the stock investor.
What’s the difference if they both retire at 65?
Over $1.2 million!
This figure is based on commonly reported historical returns. If anything, it’s understated based on historical standards, but hopefully the $1 million difference gets your attention anyway!
It pays to take some risk if time is on your side.
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