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Member You - 6 Financial Rules of Thumb
You have to purchase a domain name for your website. Choose one that relates to your product and preferably contains one of the main keywords you will use to advertise your products. Once you have your website and domain you can design your webpages. You ideally want one page for each product.Visit the sales page of your merchant and design one that has the same sort of look and feel, but not exactly the same. You don’t have to sell the product – the merchant will do that – but you should try to pre-sell it. Provide a review for example, and it helps if you have purchased the product yourself. You may not be able to do this until you have sold a few to finance your purchase, but it is ideal if sellers have themselves tried out the product they are selling. Provide a link to the merchant’s sales page, and sit back and wait.Remember, one product to each page. You should also include an opt-in form on your sales page. This is so that you capture the email address and at least first name of every visi
Regardless of what your current percentages are, aim to reduce these percentages over time. Just because a bank is willing to lend you up to 28 percent of your gross monthly income, it doesn’t mean that you should borrow that much money to buy a house.
The less money you borrow, the faster you can pay it back and the higher your monthly cash flow will be (because you’re spending less on your mortgage). The less you spend monthly, the more you’ll have to invest for your future.
4. The Retirement Rule of Thumb:
You need to save about 20 Times your annual gross income to retire There are a whole b
A bad credit history means a bad credit rating. This may be due to late or missed payments, and arrears or defaults in repaying the loan amount you have borrowed from a lender in the past. Bad credit history disturbs your peace in more ways than one. Not only do you have your lenders knocking your door at odd hours to retrieve their amount, but you find it difficult to find lenders willing to give you new loans. For those people with an adverse credit history, bad credit personal loans may just be the right recipe.Bad credit personal loans are loans you can use for any purpose than, of course, consolidating your multiple old debts. Other purposes may include home improvement that can also help you improve your home equity. You can use the loan amount to get yourself a new car or to manage your other shopping expenses and various other expenditures.The choice is all yours as far as using the loan amount goes. The terms and conditions of repayment, such as the rate of interest and the period of repayment
However, if you’re like most people and don’t have the time to read through a mountain of books, magazines and web-sites (or have the inclination to do so), then this article is for you. It will list out the main “rules of thumb” for financial planning.
1. The Savings/Investing Rule of Thumb:
Pay Yourself First: Aim to set aside at least 10% of your take-home pay I’m sure you’ve seen this rule of thumb before. I first read it in The Richest Man in Babylon. As you will learn, paying yourself first is the most important bill you will pay each month.
The best way to implement this rule is to make it automatic. Have 10% of your take-home pay pulled from your paycheck and deposited into a separate bank account. If your employer doesn’t allow you to do this, simply set up a transfer between your main account and your “ten percent” account equal to ten percent of your paycheck.
If you already have a well-funded emergency fund and your short-term goals have been funded, you might funnel all of the ten percent into a retirement plan. Of course if you set aside 10% in your retirement plan, you’ll be contributing pre-tax which works out to be more than 10% after-tax.
2. The Short-Term Debt Rule of Thumb:
So-called “Bad” Debt should not equal more than 20% of your income Short-term debt includes your car and student loans, as well as your credit cards and other forms of debt. Essentially everything except for your mortgage. You need to list all your outstanding liabilities and their respective minimum/monthly payments. Now add up the minimum/monthly payment amounts and you come up with a figure.
Take this number and divide it into your monthly take-home pay.
If the result is more than 20%, you’re carrying too much revolving debt. New entrants to the workforce or recent graduates often have a higher debt-to-income ratio because of their student loans and entry-level jobs that pay low salaries.
Compulsive spenders also have a problem because they spend every dollar they make.
You should aim to put at least 20% of your net pay toward paying down your outstanding debts. If you cease to add to your short-term debts today, you will find that you can pay off most of your short-term debt anywhere from 3-7 years.
3. The Housing Cost Rule of Thumb:
You should spend less than 36% of your monthly pay on housing This rule of thumb is mainly for homeowners, but if you’re renting and spending more than 36% of your monthly pay in rent, you’re either living in NYC or San Francisco and it’s time to find a new place. Either that or find another roommate.
Why 36%?
Well, banks like to see that the cost of your monthly mortgage payment, taxes, insurance, and utilities will not place an undue burden on your finances.
In short, they calculate the cost of living in your home and know that if you’re exceeding 36% for your housing costs, you’ve probably bitten off more than you can chew.
Regardless of what your current percentages are, aim to reduce these percentages over time. Just because a bank is willing to lend you up to 28 percent of your gross monthly income, it doesn’t mean that you should borrow that much money to buy a house.
The less money you borrow, the faster you can pay it back and the higher your monthly cash flow will be (because you’re spending less on your mortgage). The less you spend monthly, the more you’ll have to invest for your future.
4. The Retirement Rule of Thumb:
You need to save about 20 Times your annual gross income to retire There are a whole b
What steps would you take to protect your business from a burglar coming in after office hours and stealing ?40,000? I suspect that you would make sure that all the doors have very good locks. You would install a burglar alarm and maybe even have CCTV surveillance. That should protect your business. Wrong! The burglar did not break into your office; they broke into your internal phone exchange (PBX). Unseen by human or electronic eyes, thousands of pounds are being spent on international telephone calls and your business will pay the bill.How Does It Work? Dial through fraud is not a new problem, it just has limited publicity. It exploits a PBX feature that allows employees to ring in to the switchboard and by keying certain dialling codes, make national and international calls for which the company will pay the bill.Many businesses will take an "It will never happen to me" approach to dial through fraud, even though most business PBXs are setup to be maintained remotely. This is
The best way to implement this rule is to make it automatic. Have 10% of your take-home pay pulled from your paycheck and deposited into a separate bank account. If your employer doesn’t allow you to do this, simply set up a transfer between your main account and your “ten percent” account equal to ten percent of your paycheck.
If you already have a well-funded emergency fund and your short-term goals have been funded, you might funnel all of the ten percent into a retirement plan. Of course if you set aside 10% in your retirement plan, you’ll be contributing pre-tax which works out to be more than 10% after-tax.
2. The Short-Term Debt Rule of Thumb:
So-called “Bad” Debt should not equal more than 20% of your income Short-term debt includes your car and student loans, as well as your credit cards and other forms of debt. Essentially everything except for your mortgage. You need to list all your outstanding liabilities and their respective minimum/monthly payments. Now add up the minimum/monthly payment amounts and you come up with a figure.
Take this number and divide it into your monthly take-home pay.
If the result is more than 20%, you’re carrying too much revolving debt. New entrants to the workforce or recent graduates often have a higher debt-to-income ratio because of their student loans and entry-level jobs that pay low salaries.
Compulsive spenders also have a problem because they spend every dollar they make.
You should aim to put at least 20% of your net pay toward paying down your outstanding debts. If you cease to add to your short-term debts today, you will find that you can pay off most of your short-term debt anywhere from 3-7 years.
3. The Housing Cost Rule of Thumb:
You should spend less than 36% of your monthly pay on housing This rule of thumb is mainly for homeowners, but if you’re renting and spending more than 36% of your monthly pay in rent, you’re either living in NYC or San Francisco and it’s time to find a new place. Either that or find another roommate.
Why 36%?
Well, banks like to see that the cost of your monthly mortgage payment, taxes, insurance, and utilities will not place an undue burden on your finances.
In short, they calculate the cost of living in your home and know that if you’re exceeding 36% for your housing costs, you’ve probably bitten off more than you can chew.
Regardless of what your current percentages are, aim to reduce these percentages over time. Just because a bank is willing to lend you up to 28 percent of your gross monthly income, it doesn’t mean that you should borrow that much money to buy a house.
The less money you borrow, the faster you can pay it back and the higher your monthly cash flow will be (because you’re spending less on your mortgage). The less you spend monthly, the more you’ll have to invest for your future.
4. The Retirement Rule of Thumb:
You need to save about 20 Times your annual gross income to retire There are a whole b
As a self employed business owner or sales person you really need a quick 30 second proposition statement. This statement should tell the person you are speaking too, enough about yourself or your business to make them curious and want to ask you more questions about what you do.As an example if you ask me what I do for a living which of the following replies would you react more favorably too.1- I sell life insurance.2- I help people achieve financial independence by showing them how to earn $500 to $1,000 a week on a part time basis with the opportunity to move into a full time career, by helping families protect their most valuable asset their home.I’m pretty sure you will respond you like number 2 better. Most people think of life insurance sales people in the same category as lawyers and used car salesmen. Heck no one likes a salesman. But number 2 doesn’t even say the word sales in it. In fact I am not a salesman, nor do I sell Life Insurance. I happen to be a Mortgage Protectio
Take this number and divide it into your monthly take-home pay.
If the result is more than 20%, you’re carrying too much revolving debt. New entrants to the workforce or recent graduates often have a higher debt-to-income ratio because of their student loans and entry-level jobs that pay low salaries.
Compulsive spenders also have a problem because they spend every dollar they make.
You should aim to put at least 20% of your net pay toward paying down your outstanding debts. If you cease to add to your short-term debts today, you will find that you can pay off most of your short-term debt anywhere from 3-7 years.
3. The Housing Cost Rule of Thumb:
You should spend less than 36% of your monthly pay on housing This rule of thumb is mainly for homeowners, but if you’re renting and spending more than 36% of your monthly pay in rent, you’re either living in NYC or San Francisco and it’s time to find a new place. Either that or find another roommate.
Why 36%?
Well, banks like to see that the cost of your monthly mortgage payment, taxes, insurance, and utilities will not place an undue burden on your finances.
In short, they calculate the cost of living in your home and know that if you’re exceeding 36% for your housing costs, you’ve probably bitten off more than you can chew.
Regardless of what your current percentages are, aim to reduce these percentages over time. Just because a bank is willing to lend you up to 28 percent of your gross monthly income, it doesn’t mean that you should borrow that much money to buy a house.
The less money you borrow, the faster you can pay it back and the higher your monthly cash flow will be (because you’re spending less on your mortgage). The less you spend monthly, the more you’ll have to invest for your future.
4. The Retirement Rule of Thumb:
You need to save about 20 Times your annual gross income to retire There are a whole b
What will make your home page interesting? Good design plays an important part in your site's overall effectiveness. But it's not the flash that will interest your audience. It's not the jingles that will connect with your visitor. It's the benefits – the 'what's in it for me' list that create interest and even desire. Create a home page filled with benefits and it will pull your visitors in. What you say your product/service can do is much more attractive than a beautiful web page with weak copy.Promote with benefits instead of your bio, your credentials and even the features of your product/service. Put them in their proper place on your site. But your audience will most want to know the value of your product to them.You must answer questions like, "Will it solve my particular problem?" "What will I gain?" "What will I lose if I don't use your service?" Some universal benefits answer the how tos: getting more passion, more energy, less fatigue, more money, good relationships, more time, less trouble, l
3. The Housing Cost Rule of Thumb:
You should spend less than 36% of your monthly pay on housing This rule of thumb is mainly for homeowners, but if you’re renting and spending more than 36% of your monthly pay in rent, you’re either living in NYC or San Francisco and it’s time to find a new place. Either that or find another roommate.
Why 36%?
Well, banks like to see that the cost of your monthly mortgage payment, taxes, insurance, and utilities will not place an undue burden on your finances.
In short, they calculate the cost of living in your home and know that if you’re exceeding 36% for your housing costs, you’ve probably bitten off more than you can chew.
Regardless of what your current percentages are, aim to reduce these percentages over time. Just because a bank is willing to lend you up to 28 percent of your gross monthly income, it doesn’t mean that you should borrow that much money to buy a house.
The less money you borrow, the faster you can pay it back and the higher your monthly cash flow will be (because you’re spending less on your mortgage). The less you spend monthly, the more you’ll have to invest for your future.
4. The Retirement Rule of Thumb:
You need to save about 20 Times your annual gross income to retire There are a whole b
E-mail marketing of course is the process of sending promotional and marketing e-mails to members of your opt in e-mail marketing list. One of the most difficult things about e-mail marketing is learning how to write effective e-mails. Your e-mails must be compelling, interesting, and induce the reader of the e-mail to click through to your website. However, your e-mails must also not be so strong that if the reader does not like the e-mail or the Web site which they click through, that they stop opening your future e-mails.So you have to have a balance between e-mails that are compelling and effective, and e-mails that are too strong and induce unsubscribes or they induce people to stop reading your e-mails.So how do you write an effective e-mail? The first thing to remember when writing effective e-mail is that you must write your e-mail as if it is written to one person. This goes far beyond personalization option in your autoresponder system. The person reading it must believe that you were wri
Regardless of what your current percentages are, aim to reduce these percentages over time. Just because a bank is willing to lend you up to 28 percent of your gross monthly income, it doesn’t mean that you should borrow that much money to buy a house.
The less money you borrow, the faster you can pay it back and the higher your monthly cash flow will be (because you’re spending less on your mortgage). The less you spend monthly, the more you’ll have to invest for your future.
4. The Retirement Rule of Thumb:
You need to save about 20 Times your annual gross income to retire There are a whole bunch of calculators and spreadsheets on the Internet (I have one as well) that you can use to figure out how much you’ll need to retire. I’ve never come across anyone who has the patience to fill one of these out and they only take two minutes to complete! The solution is what author Robert Sheard calls the Twenty Factor Model.
Essentially the formula is:
Financial Independence = annual income requirement X 20
The formula is based on two centuries worth of returns in the stock market and the real rate of return (5% annually) you can expect to earn after taxes, expenses and inflation.
If you have 20 times your annual income requirement, it means that with the prescribed withdrawal rate of 5% yearly from your nest egg and the annual expected net return on your investments of 5%, you’ll never run out of money.
Now isn’t it much easier to multiply your gross income by 20 than to fill out one of those online calculators? I thought so. Let’s move on.
5. The Insurance Rule of Thumb:
You should have a policy equal to at least five to eight times your annual income as a minimum. Some planners suggest even more than five to eight times your annual income as the level of coverage you should carry. My suggestion is that you get your financial house in order, which means getting your net worth and cash flow statement together, and go talk to a good insurance agent about your needs.
He or she will be able to walk you through the various options. As with a financial planner, ask them how they’re compensated to keep them honest with the advice they’re giving you.
Please note that this factor or rule of thumb could be much higher, depending on the number of years of income you will have to replace. The highest “factor” I’ve seen is to multiply your annual after-tax income by 20.
Interesting that it’s the same as the above rule of thumb. No coincidence here. If you were to die and wanted to make sure your dependents would continue to receive exactly what you brought home each month, they would need to completely replace your income forever. According to the Twenty Factor Model, having an insurance policy with at least 20 times your annual income will do.
6. The Charity Rule of Thumb:
Give away at least 10% of your net pay every month.
Most of us think that there isn’t enough money to go around. We live in a state of scarcity instead of a state of abundance. We think that if we give away ten percent of our income each year, we can’t possibly make ends meet or be able to afford a decent retirement.
I understand the fears, but if you put the previous five rules of thumb in place, you shouldn’t have to worry too much about making ends meet. Let me explain.
Journalist Scott Burns, in his article titled, “Take a Look at Returns” did an analysis of the amount of money you would need to save in order to not run out of money by the time we die, assuming we retired at age 65. The conclusion was that we would have to save 34 percent of our income if we planned on living a
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