Finance 101: Expense Ratios

Jun 21, 2016 by

Expense Ratios Are you considering investing in a mutual fund? If so, expense ratios are something you will definitely want to understand. So, what are they?  An expense ratio is the associated cost with owning a mutual fund.  Mutual funds have fees because it costs investment companies money to operate them.  Unlike stocks, they are operated by a fund manager actively who buys and sells the stocks that make up the mutual fund. How much does this cost you?  If you take a fund’s expense ratio and multiply it by the total amount you have invested, the result is the year-end cost you will have to pay to own that fund.  Consider this example.  If you decide to invest $1,000  in a mutual fund with an expense ratio of  0.5%, you will pay a fee of...

read more

Are Investment Advisors Worth the Cost?...

Jun 20, 2016 by

Are you considering an investment advisor?  Here are 3 important tips to keep in mind when doing so. Motive No-one cares about your money more than you do.  I find it hard to believe that a stranger would care more about your financial security than you would. No matter how friendly an advisor may be, their goal is to make money from you.  To them, you are another client, from which they are trying to make a living. On top of that, there are numerous stories about financial advisors who put their own interest first. It’s common for a financial advisor to manage your portfolio in whatever way is most lucrative for them.  You invest your money to secure your financial freedom. Advisors invest your money to earn their next paycheck.  This certainly is not true for all advisors, but...

read more

4 Keys to Investing

Jun 15, 2016 by

Investing in the stock market can be confusing, even for the best of us.  Here are four helpful tips to keep in mind when you decide you are ready to invest. Compounding Compounding is considered perhaps one of the strongest forces in the financial world. What makes compounding so great? It is essentially your money making you even more money. For example, if you invest $1,000 and it grows 10% in one year, the total growth will be $100 for a total of $1,100. The following year if your investments again grow 10%, the growth will now be $110 for a total of $1,210. The investment made an additional $10 in growth over this short period. Overtime this growth will continue to increase exponentially.  If your money were go continue to grow at 10% each...

read more

Renting vs. Buying

Jun 2, 2016 by

To Buy or Not To Buy. That is the question. Renting vs. Buying is the number one question everybody is asking when it comes to real-estate and personal finance.  Renting is great because it gives you flexibility, you are not responsible for repairs, and you typically pay less.  However, it could also bring bad landlords, rent hikes, and less freedom to live the way you’d like. On the other hand when you buy you can customize your home, build equity, and have the satisfaction of being a property owner. But buying a home could also bring more required maintenance, more insurance, and make it more difficult to relocate.  Unfortunately like many topics when it comes to personal finance, the choice on which method is better varies from person to person. The Rule of 15 Although this is...

read more