Be Wealthy & Smart

Learn how to use cycles to determine when to be more cautious with investment real estate and protect your wealth. Interest rates indicate a slowing economy. This podcast talks about how to use interest rates when investing in real estate and how to protect your wealth.

Learn 3 things to do to stop feeling overwhelmed. Overwhelm can slow us down, keep us from achieving goals and slow down our wealth building. Here are 3 things to do to get out of feeling overwhelmed.

Learn which debt to pay off first and how to decide. This is a listener question about paying off a real estate loan on rental real estate. I show you how to determine which debt to pay off first and how to think through the rationale.

Learn a true story about how cash on hand saved a family.

Learn 5 tips for emergency cash management. Yesterday, one of my Be Wealthy & Smart VIP Experience members mentioned that her bank had experienced a DDOS computer attack and that the ATM machines were not working. Here's what she said: Hey Linda! If you weren't aware, a "technical issue" took down almost all of XYZ bank yesterday. More than 24 hours later, they're still only partially back up. Millions of customers (me included) have been unable to access their accounts. Debit and prepaid cards aren't working and paychecks and tax refunds are missing. It's a huge mess...and a big wake up call to many. I'm actually ok. My paycheck hit early Thursday morning before the outage and my debit card seems to be working. I have some groceries and about $300 cash on hand. So I'm actually fine. Not happy, but fine. Any further suggestions on how to prepare for things like this in future? I know you've talked about it, just don't remember where... I have their accounts, plus another account at a completely different virtual bank (for emergency funds). But the only way to access the funds is via transfer to my XYZ accounts. Maybe open an account at another local bank and link the virtual bank account there too? And clearly, I need more than $300 cash on hand... Yes you do! Those are good questions and I'm sorry that happened to you, but I'm glad you're being proactive to plan for a possible longer interruption of service. I believe it is important to have a good amount of cash in your possession. Now you'll want to know how much. That's not easy to answer because it depends on how much you make and how much you spend on items like groceries, gas, medicines and other necessities (for example if you have babies, diapers are a necessity for you). I'd say have about 20% of a month's income if you can. I also recommend having it in low denominations, not 50's and 100's, but 20's, 10's, 5's and 1's because it may be difficult to get change for purchases if there's a cash shortage. For example, a few years ago I went to Greece and it was during a banking crisis. They were limiting how much cash you could get per day from the ATM's and cash was hard to come by. None of the restaurants would give us any change back for our purchases! They just claimed they didn't have any cash and we were out of luck getting any money back. A $22 lunch ended up cost $40 because they wouldn't make change. You never know if someday we could have a problem with electronics either by hack, natural disaster, a bank holiday or some other reason. Don't get me wrong, I'm not predicting the end of the world. I just think it's part of smart planning to have cash on hand. I also think it's smart to diversify by account. Having a brokerage account is a good complement to a bank account because you have access to a money market, which you can use for savings, in addition to your investment accounts. It's very easy to wire the money to your bank from a brokerage if you need to transfer funds. Not having all of your money in one institution is a good idea. You never know what can happen. Remember during the financial crisis in 2008, banks like Washington Mutual were fine one day and in need of a bailout the next. Remember, the Federal Deposit Insurance Corporation (FDIC) insures deposits up to $250k per depositor. A single deposit account is insured up to $250,000. Joint accounts are 50/50 ownership and insured up to $250,000 for each individual named on the account, totaling $500,000. It's Linda here. Just wanted to pause for a moment and ask if you knew Betterment is the largest independent online financial advisor with more than $10 billion in assets under management with more than 300,000 customers? Their service helps to improve long-term returns and lower taxes for retirement planning, building wealth, and other financial goals. Betterment's tax coordinated portfolio can increase a portfolio's value by an estimated 15% over 30 years. Their annual advisory fee is only .25%, with unlimited messaging access to their team of licensed financial experts through a mobile app. Of course, investing involves risk. For listeners of Be Wealthy & Smart, you can get up to 1 year managed free, visit http://Betterment.com/bewealthy that's betterment.com/bewealthy. I'll post these links in the show notes and on my website. Now that we've established opening a brokerage account in addition to your bank account, let's talk about why people switch brokerages. According to IBD and Technometrica, 25% of investors have switched their online broker in the past 5 years, vs. 18% five years ago. The main reasons for switching are: 1. Cost - 39%. Clients are sensitive to fees and commissions. 2. Other - 21%. Not sure what that is, but we'll come back to this. 3. Convenience - 16%. Ease of use. 4. Bad experience - 9%. Customers had bad service or a complaint with a representative. 5. Execution - 9%. Trades aren't executed at the price expected. Other - 21%. Not sure what that is, but I suspect it's a catch all for everything else not mentioned above and could be research quality, etc. Changes favored in the next year include: Lower fees - 40% Better research - 28% Better buy lists - 26% Wherever you decide to keep your money: 1. Diversify savings accounts by institution 2. Consider having an account at a brokerage firm in the mix 3. Keep a healthy amount of cash on hand 4. Keep a mix of lower denominations 5. Calculate how much you'll need by thinking of how much you spend on groceries, gas, medicines, and necessities in a month or two.

Learn how to keep track of your bills so you never have to pay a late fee. I recently saw a statistic that was startling to me: 23% of people pay bills late and have to pay late fees because they are unable to find their bills. Wow! 23% is a lot of people. That's millions of people! They can't find their bills? Are they losing them in their inbox or in the mail? It's easy to lose electronic bills, I can understand that, but it's a bit harder to lose a hard copy. Think of the late fees that are happening! This is costing people hundreds of dollars per year and they could be investing that money and growing wealth. There is also a ding that happens to your credit score when you are late. I had a friend who had an awful time one time when she moved out of state. Her address didn't get changed on some of her bills and as a result they were forwarded to her too late. Some didn't reach her for a month. Even though she paid them as soon as she received them, because they were a month late she had a mark on her credit score that took 7 years to go away. It's not good to be losing your bills, so let's talk about how to fix this. First of all, there is no penalty for having your bills mailed to you instead of emailed. If you are a chronic late bill payer because you are losing your bills online, you can do one of two things. You can set up your bills for automatic payment through your bank so you don't miss a due date. Some people like this because their bills are paid automatically. Others put their electronic bills in a folder and have a spreadsheet of the day of the month their bills come due, so each month they know when they have to be paid by. I'm not good with spreadsheets, so I prefer the low-tech way! I also like to review my bills before I pay them, so you might think I'm old-fashioned, but I attribute my system to my great credit score! Most of my bills are still received by mail. When I receive them, I open them up, I look inside at the due date and write on the outside of the envelope of the bill the date it is due. I put it in a designated drawer. As more bills come in, I repeat the process and file the new bills in by the most current date on top and oldest date in the back of the stack. So if I have 3 bills sorted by date, it would be the soonest to pay on top, with the next soonest date due, and then the farthest date away. I usually pay my bills online through my bank and pay them two or three days before the due date. My mortgage is set up (with extra principal added) as an auto pay. So let's review what might help you find your bills and pay them on time so you can avoid late fees: 1. Open your bills immediately and record the due date on the envelope. 2. Put your bills in a designated area, whether it's a letter holder or a drawer. 3. Keep arranging your bills by date due, with the soonest on top or in front. 4. Pay your bills 2 or 3 days before the due date. 5. Set some or all bills to autopay if you are comfortable with that. If you're a chronic late bill payer, that's probably your best option. 6. If you are good with spreadsheets, you can keep a spreadsheet of the dates your bills are due and refer to it at least once a week. Staying on top of your bills will not only keep your credit score high but also save you hundreds or thousands of dollars in late fees.

Learn why positive thinking helps your wealth building. I've always said creating a wealthy mindset and how you think is so important to your wealth building. As you know, it's Step One of the 6 Steps to Wealth. Recently a study was done with children about whether thinking positively affected them. Here is the article: https://www.cnbc.com/2018/02/05/stanford-university-study-positivity-makes-kids-smarter.html So we know positivity will impact your success. It's like you are steering but your mind is the engine and has the power. You have to direct it to where it will go. Just like it impacted these kids, it also impacts you. How you think is going to determine whether or not you reach your goals. As Henry Ford said, "Whether you think you can or think you can't, you're right." He became one of the wealthiest men in the world. I like to modify that a bit and say, "Whether you think you can be wealthy or think you can't be wealthy, you're right." It's up to you. I'm encouraging you to think yes I can! Review episodes of how you can get your brain to think more positively by listening to podcasts 318, 313, 308, 23, and 3. You may have to go to my website to find the earlier ones at http://lindapjones.com/podcasts.

Learn the 10 things you should know about the tax act. This comes to us from CNBC.com. This podcast clears up misnomers about the tax act. A copy of the article is posted on my website at http://lindapjones.com. See podcast #378. Get "11 Quick Financial Tips to Boost Your Wealth" and subscribe to my weekly newsletter with wealth building tips at LindaPJones.com.

Learn 3 savvy things to do to get rid of debt. I've also included my favorite way to save thousands of dollars in interest.

Learn one crucial thing for you to review under the new tax act. In this podcast I review some changes made under the new legislation and the one thing you must do to be smart with your money. A link to the article is on my website at www.lindapjones.com.