When I ordered Seamless last night, I theoretically knew there were only two exit paths — either I would talk myself into cooking the perishing groceries in my fridge and exit out of the online ordering app, or $40 would exit from my wallet. I didn’t really think about it when I started adding various specialty sushi rolls to my cart. I thought that it would cost a little bit, maybe $20. You don’t think much about $20; it’s not life-changing. After seeing how much I was throwing into my cart with reckless abandon, my roommate said, “You know that’s going to cost you like, $70 right?” I thought she was delusional. Then, I hit “proceed to checkout.” That’s how I learned my dinner order was going to run me $83.67 before tip.
It’s not purely a celebratory time. Sure, I’ve temporarily alleviated the responsibility of having to cook my own meal like a functioning adult, but it’s a stressful time, too, because of the constant decisions. Is 16 rolls enough, or will I still be hungry after? I’m always hungry like, an hour after I eat sushi. Should I get an appetizer of edamame? Do I sub out a dragon for a California roll, or is that embarrassingly basic?
Of course, once I saw the total, I had a brief moment where I asked myself, should I even be doing this? That’s like, 6 months of Netflix — or maybe 5 since they keep upping the price. I don’t know. But then I considered the alternatives: opening that can of black beans that I bought “in case of emergency”, which would require wiping off the film of dust that’s collected on top of it; figuring out what to do with said black beans; maybe boiling water for some pasta? And then pretending like eating plain pasta and canned beans with a spoon is a normal and not at all sad meal. I should really invest in a rice cooker.
There are things that rich people do, and from what I’ve learned from watching Arrested Development from my roommate’s ex’s Netflix account, pretending like your problems will go away if you ignore them is one of them. So I hit “place order” on my small army-sized portion of sushi, not thinking about how it would bring my checking account balance to $2.94 and especially not thinking about the birthday drinks I promised my friend I’d go to on Friday. I resolved to sell some of the clothes I don’t wear that much on Poshmark to make up the difference—“gently used” is subjective, right?
At this point in my life, nothing is going to change. What would I do differently, aside from budget, exercise self-control, or say no to social obligations? I’m only having as much fun as my peers are. So if they’re going to brunch, why shouldn’t I go to brunch? Never mind the student loan debt I’ve barely made a dent in despite making the minimum payments for eight years. (Talk about not thinking much about $200,000.) I keep a shrine in my closet to President Biden and pray every day for him to forgive student loan debt, so I’m doing my part.
What would I really do with the money aside from pay my bills or donate to my 401(k) that, similarly to my emergency black beans, is also collecting dust? It’s not like I’m ever going to be able to afford to buy a house. And even if I could, Williamsburg feels like it has peaked and is going downward. I walk my dog at 1pm, and I pass like, two different açaí bowl places that have closed down. I think that’s unsustainable. Shit, that reminds me—I forgot to pay the premium on my dog’s health insurance this month. Hope he doesn’t need any serious dental surgeries.
Guess I’ll have to open up a dating app and line up a few dinners for next week. Most of my friends are getting married or having kids, and I guess I should technically be looking for someone I could bring as a plus-one to their weddings, but my more immediate concern is finding a plus-one for happy hour on Thursday.
What’s that saying, you can’t take it with you? At the end of the day, even if I did get to a point where I was somehow making a lot of money (like maybe I won the lottery?), I could just lose it all. Isn’t that what happened with Yahoo? It was the darling company in the 90s and know I don’t know if it exists. I think about Yahoo constantly, but not enough to have ever typed it into the address bar of my laptop, phone, or tablet to see if it’s still around. I guess I could look that up. Hey Google…
Images: JP Valery / Unsplash
As I’m sure you’re well aware by now, GameStop made major waves this week. The video game-retail-dinosaur was on the verge of bankruptcy, causing their stock to hit an all-time low. Because of this, the Wall Street elite started to bet against them, making money on GameStop’s failure and reaping seemingly unethical benefits from their demise.
I’m not one of those finance bros, but I’ve met a lot of them and dodged many a rant about stocks in my day. So I’m basically just expressing what I know about the situation at a very beginner level. My knowledge of stocks goes back as far as The Wolf of Wall Street, but other than my killer Donnie Azoff impression, it’s not really my area of expertise. Because of these shortcomings, I had to do my own research.
To paraphrase Margot Robbie in that one bathtub scene from The Big Short, *cue Jordan Belfort fist in mouth*, shorting a stock is when investors borrow other people’s stocks and sell them in the hopes of buying them back later on to make a profit. This happens all the time—people even do this for a living, and lowering the value of a stock is a very common thing to do, regardless of how unethical I may think it is. However, it went way further than that in the case of GameStop, because the company started losing real value. But the hedge fund guys just didn’t care, and they kept doing it until they started making a lot of money at the company’s expense… which is where Reddit entered the conversation.
I’ve read 5 articles about what happened with GameStop and I still don’t understand it even a little bit which must be how my mom feels when I talk about Twitter.
— Ꮍᴀᴇʟ (@elle91) January 28, 2021
What had been brewing on Reddit for a number of weeks (seriously, this was a well-orchestrated event) eventually culminated in a mass purchase of GameStop stock, led by the subreddit r/wallstreetbets, taking place on January 27 into January 28. Regular people, like you and me, were eating this up. Maybe it was nostalgia for GameStop, maybe it was an “eat the rich” mentality, I don’t know, but what I do know is that people were hungry and to the moon they went. To give you an idea of the effect this maneuver had on the GameStop stock, it went from a value of around $18 to about $330 in a couple of hours.
Everyone wanted in on the financial fun, and after the GameStop stock skyrocketed, the crowd on r/wallstreetbets turned its attention to other “dying” companies, including AMC Theaters, Build-A-Bear, and even BlackBerry, to name a few. All of these companies whose stock had been in the dumps were suddenly making major market comebacks, and regular people quickly started making irregular money. And who did this hurt? You guessed it: those finance bros we were talking about earlier, who were counting on these companies to fail.
So let me get this straight: Redditors rallying GameStop is market manipulation, but hedge fund billionaires shorting a stock is just an investment strategy?
— Robert Reich (@RBReich) January 28, 2021
Naturally, the Wall Street crowd cried foul play, talking to any media outlet that would allow them to spin a story of greed and collusion, even calling the Reddit scheme an “attack on the wealthy“. How dare anyone else try to manipulate the markets that they’ve been manipulating for years! Before long, a popular trading app, Robinhood, started making it very difficult to place orders on GameStop and other suddenly-popular stocks. They even went so far as to glitch the site into not allowing users to draw funds, and making it impossible to do basically anything other than sell existing stocks.
Robinhood has since issued an apology to its users, saying these moves were made with everyone’s safety in mind. But given the intense pressure from the financial world, no one is really inclined to buy (pun intended) that explanation. Judging from Robinhood’s reaction to this week’s events, it’s clear that they’re not immune to the influence of the Wall Street elite, and it’s too bad. This week’s events were undeniably chaotic, and Robinhood may have considered a number of factors in their decisions, but their reputation as a great equalizer in the finance sphere has certainly suffered. The app received a tidal wave of bad reviews on mobile platforms, and the company has confirmed that the Google Play Store assisted them by deleting over 100,000 one-star reviews.
Say what you will about this ongoing story, but if nothing else, it got a lot of people into day trading, myself included. Just as a disclaimer, you should always research your investments and take educated risks, if you’re going to take any at all. Investments shouldn’t be treated like savings accounts, but they can be a lucrative and exciting way to grow your money. I like seeing the lines go green and I’ve heard that the red ones aren’t so good, but I’m still learning. Anyway, until next time, stonks.
Images: quietbits / Shutterstock.com; elle91, rbreich / Twitter
One year ago, perennial personal finance expert Suze Orman was doling out her tough-love financial advice, including haggling with creditors for lower interest rates and delayed payments.
But now? She’s changing her tune.
“We’re out of options. You can’t call your creditors. They’re done … So you have to generate less expenses and somehow find more money. That’s the goal here,” says Orman.
Um?
Finding more money is a tall order, to say the least. Amid the runaway pandemic, the government has gone bust with a record-breaking $572 billion debt and an economy in free fall with nearly 11 million and counting unemployed.
It’s grim and apocalyptic AF. The Pantone 2021 color is a red called That Bitch 2020 Isn’t Over Yet (just kidding, but it literally is gray). And on kitchen tables across America, the bills are piling up — that is, for those lucky enough to still have a kitchen table.
“The eviction moratorium is over,” Orman says. “Very shortly, unless it’s extended, the student loan payment moratorium is over, the mortgage payment moratorium is over, and now you have got to pay your car payments and your car insurance and your life insurance. All of those moratoriums where you had months where you did not have to pay any of those bills, now you do.”
It’s seriously daunting. So, what’s a broke-ass betch to do?
“You have to live below your means but within your needs,” Orman advises. “If you are finding yourself in a situation where you have no money coming in, you’re living off unemployment, and you can’t wait until the stimulus check gets there, then you’re going to have to make some very, very hard decisions in your life.”
No kidding…
Don’t Use Your Stimulus Check For Back Rent
Orman says fans have been sending her pictures of their empty fridges.
“If you are waiting for that stimulus check and you don’t have another penny to your name, I would go and buy canned food with it. I’m not joking. At least if you bought canned chicken, canned salmon, you can feed yourself and your kids. At least project two months’ worth of food for yourself and your family and take care of that and take that one concern off the table.”
If you do owe back rent, Orman says do not use your stimulus to pay it. With no end to the pandemic in sight, you’ll need as much cash reserves as possible. If you can, she suggests moving back in with Mom or Dad, a sibling or a friend until you can get back on your feet.
“If you do not have a job, and you don’t know what you’re going to do, sorry everybody, you have to move out.”
If you’re fortunate enough to be on the other end of the financial spectrum, and your finances are in order, Orman says, be selfless. “If you have a paycheck coming in, you’re relatively secure, you have an apartment, you have food, and you have your next-door neighbor or a friend or a relative, and they’re about to be evicted, they can’t keep their electricity on because it’s been shut off in the middle of winter — help them.” That might be a tall order coming from a country of people who won’t even put a piece of cloth over their face to save lives, but hey, we can dream.
Don’t Take A 401K Loan
Thinking about tapping your 401K for a hardship loan in 2021? Orman says, “Never.” The CARES Act that allowed Americans to withdraw up to $100,000 penalty-free and take up to three years to repay the income tax has expired, so you’ll have to pay your withdrawal back pronto. Plus, in case sh*t really hits the fan, your 401k is protected from bankruptcy.
“If it’s between taking money out of your 401k to get you by, and all you have is enough for one month at most, and you don’t have any prospects on the horizon, I would much rather see you claim bankruptcy now for your credit card debt, and all your debts — except student loan debt, obviously — and be able to keep your 401k money intact and not have any debt. Which is why you want a Roth IRA, because if you had a Roth IRA now and you needed money, you could withdraw it penalty and tax-free.”
Don’t Forget About Saving
Pre-pandemic, Orman said an 8- to 12-month emergency savings is crucial. Today, she says a three-year stash is necessary. It’s a lofty goal for those living hand-to-mouth, but starting somewhere, with any leftover money, is still a start. Orman says she’s partnered with Alliant Credit Union to incentivize people to save $100 in a high yield savings account every month. At the end of 12 months, the credit union will reward brand-new account holders who have a $1,200 balance with a $100 bonus.
Don’t Bank On Student Loan Forgiveness
It remains to be seen if President Biden will succeed in his plan to cancel $10,000 of student loan debt for every borrower. “You have to get that this is not a done deal,” she says. “You should continue to do exactly what you can do and act as if is not going to happen. If you’re out of work, just pay as you go, or do an income-based repayment program. Just don’t go into default.”
There’s also an IRS loophole to be aware of. “Don’t be afraid that the amount accruing gets added to the back end of the loan. If nothing changes in 20, 25 years, if you owe more on the student loan than what you’re technically worth, you’re insolvent, and the IRS will most likely forgive it.” Adds Orman, “If you’re making money, you want to be on the standard repayment method.”
Do Consider A Career Change
These tough times are as much about survival in the present as they are about making smart pivots to safeguard yourself financially in the future. Orman says that the pandemic wiping away jobs shouldn’t be your only worry. In case we didn’t have enough to be anxious over, there’s also the threat of artificial intelligence replacing human workers, further destabilizing the gig economy.
“You have to take this time to reimagine yourself, to recreate yourself. And what can you do? Who can you become, where you cannot be replaced by artificial intelligence or a robot? What can you do to create yourself so that you never find yourself in this position again? Because you’re going to have to make the decision. Do you do a temporary fix and just get anything that brings in money? Maybe. But at the same time, what can you do to make this be a permanent fix so that this couldn’t happen to you? Not because of the pandemic, but because of the onslaught of the technological revolution that will absolutely do away with jobs in the future.”
When in doubt, Orman says saving is the name of the game. So, chill with the online shopping. (No, you don’t need the new SKIMS collection.) Paying your bills on time will keep your credit report happy. And stash your cash, in a high yield savings account, preferably. Bottom line, even if you haven’t worn pants in months, you’d better tighten your belt.
Images: Annie Spratt / Unsplash
If you’re a having a bit of a WTF moment right now because you’re a REAL ADULT paying taxes and bills all by yourself, you’re definitely not alone. Entering the finance world can be pretty scary because it is guarded by toxic finance bros and confusing terminology that seems to be an entire language on its own. So if you clicked on this article, you’re probably thinking that you’re just a beginner trying to get your feet wet, but honestly, you’re one step ahead! The HerCapital team is here, and we’re going to show you that money can be easy and approachable, by introducing you to 10 basic financial terms that you need to know.
1. Compound Interest
Ever heard the phrase “time is money”? Well, whoever coined that phrase (no pun intended) definitely knew what they were saying because in financial markets, time literally equals more money! Compound interest is the interest an investor earns on their original investment and all the interest that has been earned from the interest added up over time—essentially it’s “interest on interest.” The effect of compounding becomes especially powerful with time, which is why it is advised to invest early, even if it is with a small amount.
2. Federal Reserve
If there’s anything quarantine can be remembered by, it would probably be Dalgona coffee, wearing PJs to our zoom meetings, TikTok binges, and all that hubbub about the Federal Reserve. Wait…who…what? The Federal Reserve—“Fed” for short. Serving as the bank’s bank, the Federal Reserve is responsible for setting monetary policy for the United States and maintaining the overall stability of the economy through altering money supply and interest rates. Through the sh*tstorm of COVID-19, the Federal Reserve is the one behind the scenes supporting households, small businesses, and government, through actions like lowering federal funds rates (the interest rate at which banks borrow and lend money to each other) and encouraging banks to lower lending requirements so they can give more money out to borrowers.
3. Inflation
Inflation is the rate at which the general level of prices for goods and services is rising or decreasing, even when the quality of said products is constant. Today, most central banks set inflation target rates at 2%. During the Great Depression, inflation rates were negative over a long period of time, which meant that prices were dropping like it’s hot! Sometimes this happens because people hold off on buying goods, in turn hurting the economy in the long run since there is limited economic activity. On the flip side, positive inflation can be troublesome as prices of goods increase dramatically—imagine that $2 coffee doubling to $4 in a year; that would not be great for your budget.
4. FICO Score
We personally would never go on a sketchy Tinder date without going on an FBI-esque investigation and going down the rabbit hole of weird 2014 Facebook photos. When it comes to credit, it’s pretty similar. By ranking consumers on how likely they will be to pay off their credit obligations, FICO scores help lenders make informed decisions on whether or not they will extend credit. Scores range from 300 to 850 and baked into this score are elements like how much you currently owe, your payment history, and the length of your credit history. The higher your score, the higher your creditworthiness, and people with higher scores often have an easier time securing loans and seeing benefits in their terms and interest rates. Ah, if only spotting red flags in people were that easy.
P.S. In case you are wondering, the name comes from the Fair Isaac Corporation who created the score.
5. Individual Retirement Account (IRA)
If there’s anything everyone in the world can agree on, it’s that we f*cking love free money. So think of IRAs as piggy banks that let you set aside money for retirement, where your contributions grow with interest and you don’t even have to lift a finger. Traditional Individual Retirement Accounts (Traditional IRAs) let you deposit pre-tax income to a retirement account where that money grows tax-deferred until you take it out for the golden years. Roth IRAs, on the flip side, are not tax-deductible (meaning you deposit after-tax income), but you can still make contributions as long as you are earning an income and withdrawals are tax-free. A key difference between the two is that you cannot deposit into a Roth IRA if you earn too much (>139k if single and 206k if you are married)! To open a Roth IRA, you need to find an institution (banks, brokerage companies, federally insured credit unions, and savings and loan associations) that has IRS approval to offer this type of account.
6. Capital Gains
Like the term itself describes, capital gains are the gains (income) that stems from the sale of an asset, such as financial investments or real estate. If you hold the underlying asset for less than a year, the capital gains are taxed at the same rate as your income. This profit is typically taxed at 20% or less for long-term assets i.e. assets held for longer than one year.
7. Securities
Now, while putting your money in a savings account is better than just parking it under your mattress, you could honestly get so much more by putting your money into securities, tradable financial assets used to raise capital for governments and corporations both privately and publicly. Traded in financial markets, securities include stocks, bonds, and options, all varying in definition and ownership. What you really need to know, though, is that investing in securities typically comes with a higher yield, which means more bang for your buck, literally. Read more about them on our website.
8. Financial Statement
If you’re an investor, you have probably heard of people screaming to buy the “hottest stock” of the moment. But you might wonder, what’s the hype? That’s where financial statements come in. Financial statements clear the noise and get to the down-and-dirty realities of a company’s financial performance. They are written records of all business transactions and activities, reporting elements like profit and losses, liquidity, and assets. The four main financial statements are the balance sheet, income statement, statement of shareholder’s equity, and cash flow statement. So when you invest, be sure to do your research, comb through those statements, and make an informed decision.
9. Asset Allocation
There are appropriate times to be risky and times to play it safe. Just like in life, you might want to try out that piece in your closet that you never, ever wear, but if you’re cutting bangs after a fresh heartbreak we’d tell you to slow down a little bit. When it comes to your financial plans, asset allocation is all about understanding and tolerating your risk and wisely choosing where to put your money. Different asset classes react differently in the economy, thus you can create your own mix that caters to your needs, time horizon, and goals. And take the time-tested tip to diversify, diversify, diversify!
10. Bull & Bear Markets
Within the financial world, the terms bull and bear markets refer to the general sentiment about the markets. A bull market is a sustained period where prices for securities are on the rise, often driven by optimism, investor confidence, and high expectations. On the flip side, a bear market is a period of contraction, characterized by falling prices. It generally occurs amid investor pessimism and shaken confidence and is often accompanied with an economic downturn, such as recession. I guess you could say that investors find this time to be unBEARable… sorry.
And that’s it—the 10 financial terms everyone should know. Wasn’t too bad, right? If you have any more questions or are looking for more resources, you can drop a comment here, or check out our HerCapital website and Instagram @her.capital. We’ve got lots of stuff for our community of badass women invested in their financial futures like you.
Images: Sharon McCutcheon / Unsplash; @her.capital / Instagram
In plain and simple terms, investing is putting money down now in hopes for more money later. But why do we hear time and time again that it’s so important? Well, whether it be to pay off your student loans, save up for your older, richer self, or even for your girls’ trip to Hawaii, investing is a great way to make your money work so you don’t have to. We know it can be scary, but we are here to break it down for you, so you can be well on your way to becoming wealthy like a finance bro… without the douchey attitude.
General Strategies For Investing
Early bird gets the worm: Time in the market always beats “timing” the market. Thanks to the power of compounding, small contributions in the present will reap higher returns than larger contributions later. So start today!
Make a clear plan: Think about your budget. Are you setting aside a part of your monthly savings to invest? Take baby steps even with a small amount of money. For instance, instead of going on an impulsive online shopping spree (been there, done that), set that money aside and invest that bonus. Some apps even allow you to invest using pocket change—who wants coins jangling around in your wallet anyway?
Assess your level of risk: Depending on whether you are 18 or 60, you are going to have vastly different approaches. If your golden days are near, you are better off placing your capital in safer investments, like bonds. If you still have 50 years until retirement, gear your investments toward riskier, but high-yielding investments, like stocks. Allocate your investments according to how much risk you can tolerate.
Different Investment Vehicles
Brokerage Accounts: To buy and sell your investments, you’re going to need a broker. Luckily, opening an online brokerage account is super simple and only takes a few minutes (quicker than your skin care routine, we promise). TD Ameritrade and E*TRADE are great places to begin since they’re user-friendly with a huge wealth of resources.
Mutual Funds: Mutual funds are professionally managed investments that pool money from different investors—almost like a potluck of the finance world where you just show up with whatever the host tells you to bring. They are often one of the best investments you can make, given their low cost and risk. This is because mutual funds spread themselves across a collection of different investments, allowing you to capture the returns of different markets through just one single purchase. As such, these are great for those who want to leave the decisions up to professionals and not go through the work of buying individual stocks and bonds.
Traditional IRA: An Individual Retirement Account (IRA), as the name suggests, is an account for you to save any and all retirement money. These are open to anyone with an income (internships and part-time jobs included). You don’t have to pay tax today on the money you put into this account, which means your money can grow tax-deferred until you start taking it out—aka extra $$ for those golden years. Not to mention that many employers offer to match your IRA contributions, which means even. more. free. money. Why would you not sign up for this?!
Now that we’ve gone over the most common types of investments, let’s hone in on the big money-maker: stocks.
Stocks
Like pieces of a pie, buying a “share” in a company entitles you to partial ownership of the company. If the company’s value increases, your investment increases too. Bigger pie, bigger slice! Stocks are awesome investments because amongst the most common securities, they reap the highest returns over the long run. Here are some tips to help you get started.
Consider how active you want to be. Some of us check Instagram every week, some of us check every hour (what else can you do during quarantine?). Similarly, ask yourself how active you want to be with your investments. If you see yourself being an active investor, that means dedicating a bit of energy each week into researching new investments and individually curating your own portfolio. If you see yourself being more passive, go with a robo-advisor, an automated investment management service that can customize a portfolio according to your goals. Betterment is one robo-advisor you can look into.
Choosing a company. When you invest in a company, it is because you believe in their long-term growth. If you are just starting, go with the companies whose products you love, rather than the “hottest” stock at the moment. A great stock comes hand-in-hand with a strong company—think management, strategy, and financials. What is their revenue like? Are they on top of industry trends? What experience does their C-Suite have? Have they been in headlines lately for product launches? There’s quite a bit of research that can go into this, and websites like Seeking Alpha are great places to get your feet wet. But when it comes down to it, just ask yourself—would you be proud to own this company?
Don’t put all your eggs in one basket. Investing is like applying to colleges. You do not just apply to one, even if you are sure about getting in. You hedge your bets and wait for the results. Be sure to diversify and invest in different industries.
That’s all for today—thanks for reading, folks. If you have more questions or want to learn more (why would you not?!), the team at HerCapital would love to help! Comment below, check out our website here and follow us on instagram for more tools and resources @her.capital!
HerCapital’s mission is to empower women to invest in their future. Through virtual events and an online knowledge base, we hope to help women with money management all while building a community of strong women who lift each other up. Click here to check out our website and follow us on our instagram @her.capital!
Images: Austin Distel on Unsplash; her.capital / Instagram (2)
This pandemic is a totally scary, unprecedented time in all aspects of our lives, including finances. Businesses are closing their doors, employees are getting furloughed or laid off, the stock market is plunging (or so I am told by my dad)—if we weren’t worried about our finances before, we certainly are now. During this heightened time of stress, many are struggling to figure out what they can do to ensure financial security. Our advice? Don’t check your 401(k) for a while… it’s only going to make you freak out even more. And to help put your mind at ease and give you tips on actions you can take to protect yourself, we spoke to Ken Lin, CEO of Credit Karma, about what you should be doing, and the types of mistakes to avoid.
1. Know Your Options
The situation we’re in is a weird one that no one saw coming (well, except the world leaders who were warned about it and tried to ignore the problem, thinking it would go away, but that’s neither here nor there). An important thing to keep in mind is that banks realize we’re in a f*cked up situation right now and may offer you a new plan in response to what’s happening. Lin advises to take matters into your own hands and “call your credit card issuer, as they may offer a hardship plan, which sometimes offer lower interest rates, smaller minimum payments and/or lower penalties.” I’m sure the last thing you want to do now is get on the phone and wait on hold, but you have the time, and it could help you a lot, so just do it.
2. Pay The Minimum Amount Due If You Can
If you aren’t getting paid your usual salary, your hours have been cut, or you’ve been laid off or furloughed, you may be freaking out about paying your credit card bill in the next few months. While it’s usually best to pay in full each month, Lin says, “during times of stretched income, try and pay just the minimum payment to help you avoid late fees or dings to your credit.” The good news is that issuers typically won’t report the late payment until it’s 30 days past due, so you may have a bit of wiggle room. Lin explains, “If you can make your payment before the 30-day mark, you may not have to worry about the late payment being added to your report.” So if you can afford to make that minimum payment, even if it’s a couple of days late, it can save you stress and may not incur late fees, but just make sure you double-check your credit card details.
3. Don’t Default To Swiping Your Credit Card
I don’t know who needs to hear this but STOP online shopping during quarantine… oh wait that’s me
— Linsey Meister (@linseyx5) March 25, 2020
You may want to make purchases on your credit card in order to make ends meet, but there might be better options out there. Lin advises, “If you’re looking for an alternative, often times personal loans will have lower interest rates than credit cards.” He also offers that before you swipe or open up an additional line of credit, you take note of the interest rate on your credit card and make sure you’re not accruing additional interest and fees.
4. Think Twice Before Taking Out A Payday Loan
Before you borrow any money, take a nice hard look at the fine print. Lin cautions, “Payday lenders tend to prey on those in desperate circumstances like these, and these loans can be the beginning of a long cycle of debt.” He advises holding off on these types of loans, as “a payday loan may carry unfavorable terms, including high fees and interest rates.” The best thing to do, he says, would be to look into other options available to you, such as emergency or personal loans.
We’re all feeling all kinds of emotions right now, but it’s important you take care of yourself, and part of taking care of yourself is making sure your finances are in check. Trust me, everyone is in the same boat. When in doubt, look into your options and talk to someone on the phone. There may be solutions there you haven’t thought were possible.
Images: Sharon McCutcheon / Unsplash; @linseyx5/Twitter
Venmo Partner
When Venmo first became popular, it was a total game-changer when it came to paying people back. Remember when you had to write your roommate a check to pay the utilities? Or go to the ATM to get your friend back for the pizza they bought you? Or keep a list of everyone who owed you money, even though you knew they were never going to pay you back? The Venmo app helped fix those problems, and now the Venmo Mastercard® is working to make your life even easier.
If you don’t understand anything about finance (same), the Venmo card is thankfully very simple to understand. Basically, it’s an extension of the app, but now you can use it in the real world. With this debit card, you can make purchases everywhere Mastercard is accepted using your Venmo balance. So if everyone finally paid you back for brunch last weekend, now you can use that money to treat yourself to a new pair of shoes. And then you can easily keep track of all your transactions in the app. And of course, you can also use the app to split any purchases made with the card.
The Venmo card comes with a Rewards program that puts money directly back into your balance. Venmo Rewards are designed so you can actually start reaping the benefits of all the money you’re already spending. When you shop with Rewards partners like Sephora, Dunkin’, or Macy’s*, the cash back goes directly into your Venmo balance—praise be. Seriously, it’s so easy. Maybe you didn’t need to buy yet another eyeshadow palette at Sephora, but at least with Venmo Rewards, you can get money back to spend on something else, like delivery sushi or maybe your rent—up to you. I’m not exaggerating when I say that Venmo Rewards is basically the best thing to ever happen to me.
The Venmo app also lets you easily switch the card on and off, in case you ever lose it. We’ve all had that moment of panic where a card just goes missing out of nowhere, but the on/off switch will save you from suffering through a phone call with the bank when you find it in the bottom of your purse 30 minutes later. As someone who hates talking on the phone, this is a lifesaver. You can also choose which color card you want, because no one wants their wallet to look boring. And one more time, let me just mention how amazing the Venmo Rewards are.
If you already love using Venmo to make your life simpler, the Venmo card is a no-brainer. You can click here to learn more about the Venmo card, and apply to start earning rewards ASAP when you get your card.
*Each Venmo Rewards Offer Powered by DOSH is available for a limited time only at participating merchants on qualifying purchases (as stated in the particular offer and subject to the full program terms). By participating, you agree that DOSH may create a wallet for you on its system in order for you to earn and redeem Venmo Rewards. Any Venmo Rewards that you earn will be transferred to your Venmo account. All offers made available to you may become unavailable without notice. Additional terms and exclusions apply. See full Venmo Rewards Powered by Dosh Terms of Service and Privacy Policy here.
The Venmo Mastercard is issued by The Bancorp Bank pursuant to license by. Mastercard International Incorporated. The Bancorp Bank; Member FDIC. Card may be used everywhere Mastercard is accepted in the U.S. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
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There are only a few things I truly, genuinely love in this world. One of which is money. I f*cking love money! Maybe that’s why I’m a finance major, despite a continuous history of despising any form of math. Even if you are not money-obsessed like me, I’m sure we both want the same thing: financial security. In college, you want to feel at least somewhat capable of funding your nights out, your Postmates deliveries, and general miscellaneous things that pop up. This doesn’t even include, you know, like, your education itself, or textbooks (barf). So I am here as a personal Jordan Belfort, per se, to tell you how to be not be a broke-ass b*tch for the duration of your schooling. I know he’s a stockbroker, and not necessarily an advisor, but just go with it.
Formulate a budget
Please, please, hear me out. I know this sounds like literal hell, but trust me, it makes a difference. I don’t mean you have to make a spreadsheet or comb through your bank statements. You barely have to do any work if you use budgeting apps like Mint or Pocketguard, which allow you to connect the app to your card and see a variety of statistics on where you’re spending your money. Setting a budget will allow you to account for what you’re spending the most on and your overall patterns, and you can only improve your spending when you have a knowledge of its current status. Like, you might think you only spend $100 per month on going out (LMAO), but once you see the hard numbers, it’s a lot harder to lie to yourself. I know you fellow online shopping addicts lovers have all your credit card information memorized, so let’s put that sh*t to good use for once.
Do not pay full price for niche items or one-time wears
There will be a ton of date parties, dances, and other occasions that you will most likely have to buy stupid sh*t for. Scouring the internet for the cheapest pair of pink cowboy boots might not seem like the most fun use of your time, but a bit of planning and searching when it comes to niche items can save you a ton of money. I am literally giving you a justification to online shop instead of doing homework, so take it! I save money on random clothes by taking advantage of student discounts and using resale websites like Poshmark. I know what you make be thinking, “student discounts for students, groundbreaking.” But there are a lot of programs and/or stores that give you a discount for putting yourself through four years of distress, and all you have to do is ask! Obvious ones include ASOS, TopShop, and Amazon’s student Prime membership, but even Outdoor Voices is now offering an expansive student perk program. Like, sorry, but you don’t need designer go-go boots for your 70s theme party. Go to a cheap store with student discounts or buy used ones.
Have the money conversation
Sometimes the thing that costs us the most is our aversion to any form of an uncomfortable conversation *hits blunt.* The reality is that as you make new friends and meet new people, your financial expectations and ideas of money are simply not always going to match up. This can go both ways and can encompass a ton of things. However, if you are feeling financially stretched, I guarantee you another person in your group is as well. Are you guys all going to split Ubers? Does everyone purchase their own alcohol for pregames or do you all split it? It’s especially important to talk about money with your friends if you’re planning any trips for Spring Break or any other occasion. Differences in travel expectations can create huge rifts within the group. It’s important to address things relating to money so you don’t end up angrily staring at an excessive Venmo charge, or worse, have some bitch ignore your passive-aggressive Venmo request.
Use investing apps
I understand this is technically more long-term, but it is still a great way to lay a foundation for financial independence later on. And don’t get freaked out by how old-fashioned that sentence sounded. Investing apps may sound scary, but they take virtually no skill at all and could probably be utilized by a blind dog. If you spend a lot of money on your debit card, Acorns is a perfect passive investing app that leaves little room for you to f*ck anything up. Acorns rounds up any purchase you make to the next dollar and invests it in things called Exchange Traded Funds (ETFs). ETFs are are pretty much the Jennifer Aniston of investments: they’ve only grown in popularity since the 90s and are pretty unproblematic, but not crazy exciting. Acorns usually charges a small fee for use, but people under 24 and in college can use it for free.
If you’re more into having control over what exact investments your money touches, Robinhood allows you to buy and sell stocks without the trading charges you normally have on other large platforms. Again, investing is more of a long-term flex, and you’ll most likely not make any notable amounts of cash to use immediately this way, but if you somehow figure out the next Big Short on a millennial investing app, call me. It’s only fair.
Consider setting up a separate savings for an emergency fund/study abroad
I like my money how I like my carbs: just out of reach. If you have a borderline concerning lack of self-control (guilty as charged!), consider opening up a separate savings/debit account to put money into that you’ll only use for a specific purpose. I did this when I got to school, and many banks don’t charge you to open a new account. I’m going abroad this year, so I’ve been dedicating a portion of each of my paychecks to go toward my separate account, and I don’t let myself touch it at all. This is painful in the moment, as I’d love to keep a little extra money to spend on everyday sh*t, but I also really want to be able to flex on hoes this semester with my study abroad posts. Again, this is a priority for me, but it may not be the same for you, so personalize as you wish.
Hopefully my basic knowledge and inflated ego helped you realize you can still buy the sh*t you want while also being smart with your money. If you’re going to destroy your body with ungodly amounts of stress, sleep, and drinking, you might as well be financially healthy.
Images: Sharon McCutcheon / Unsplash; Giphy (3)
