Let’s face it: Sometimes, times get tough from a financial standpoint.
From life changes like buying a house or having a child to inflation to the simple cost of living, sometimes finding a budget that works for you and your family can be tricky.
Luckily, there are some very common and simple tricks you can implement into your financial plan in order to have a bit more financial security and stable, reliable income. How is that possible?
Hold tight, we’ll get to it eventually.
First, we’ll look at some key data from the JP Morgan Chase Institute regarding the volatility of Americans’ finances. Understanding how to weather this volatility can go a long way towards properly managing your budget.
Then, we’ll offer up a few simple tricks on how you can better plan your expenses around the income you know will be coming in each month.
Finally, we’ll glance at a new, simple investment option that is similar to annuities, only with added security and reliability. Having an annuity-like boost to supplement your monthly income could go a long way towards managing your budget, after all.
But before we dive in, if you can’t wait until the end of this blog (we promise, it’s worth it) and are too curious about how to earn a stable, consistent stream of income through a simple investment, then contact Tactical Wealth to learn about our simple, innovative Fixed Income Fund. If you need that extra monthly cash boost and don’t have the need for immediate liquidity, then our alternative to traditional fixed annuities might be right for you. Learn more about the Fixed Income Fund here.
Now, if you’re ready to learn more about navigating through the choppy waters of finance and get some tips and tricks on budgeting your money, then let’s dive on in.
Financial Volatility
Part of the reason why making a budget is so difficult is that the difference between our monthly income and our consumption tends to see-saw so frequently.
JP Morgan Chase studies show that in 60 percent of households, the amount that U.S. households spend on consumption tends to fluctuate upwards of 30 percent and even more from month-to-month. This can be damaging to a budget, especially when considering that 41 percent of households also say that their monthly income fluctuates at a rate of 30 percent or more each month.
This can be due to a number of factors, some of which are out of our control (like months with an odd-number of paychecks, taxes and refunds), and others that are entirely in our control (year-end shopping).
The problem with such rapid monthly changes in our budget is that often times, American households don’t have enough money built or saved up to account for these influxes in consumption or even everyday bills. That can make it hard to ever gain ground when it comes to striving for financial security and bliss.
Understanding this trend underlines the importance of better, smarter monthly budgeting.
Let’s see if we can help with that.
Tips For A Better Budget
How do you currently manage your finances? Do you fly by the seat of your pants, so to speak, and simply check your bank accounts every so often to make sure you have enough to cover your expenses?
Or, do you write everything down, or keep it in a simple spreadsheet, to track income flowing in and expenses going out?
Chances are, if you’re the type of person that does the latter, you’ll likely have an easier time accounting for that volatility we outlined earlier, thus leading to a more efficiently managed budget.
- Write It Down: Ultimately, according to Time Money, the goal should be to make sure you’re reducing consumption to 90 percent or below of the total amount of income you or your family has. By totaling your total income (post-tax, of course), you know what you’ll be working with on average each month. Then, by tracking the fixed expenses you know you’ll have each month, such as mortgage payments, utility bills, child care, and more, you know what sort of buffer you should have each month for outside spending.
- Plan, Plan, Plan: That buffer leads right into the next tip, which is to “expect the unexpected.” We should all have a fair amount of money set aside as reserves in the case that life throws a curveball. While we never know what type of unexpected expense is going to creep up, we can still account for something happening. Whether it’s your child getting injured while playing sports, or you get in a minor fender bender and have to account for repairs, it’s always a safe bet to budget for an emergency.
- Cut The Fat: Don’t have enough to do that? Well, then it’s time to weed some things out. Comb through your expenses and see if there are things you could do without. Are you getting the most bang for your buck at the gym? How often do you really use that streaming video service? These types of subscriptions can add up and put a considerable dent in your budget, so looking for ways to streamline your expenses can go a long way towards financial security.
- Invest Wisely: You may be thinking, “Invest? Now? Really?” Well, the answer is “Yes, Yes, and Yes.” Setting aside money in your budget to make an investment in a program like a 401K or IRA will pay off in a big way come retirement, but it could also help you earn additional income now. Returns from the right investment can help mitigate your expenses, and having a consistent, stable dollar amount each month that you can allocate towards things like credit card or mortgage payments can be a huge weight off your shoulders. It may sound tricky or complicated, but it’s not.
Fixed Income Fund
Finally, we’ve got to the really good part. The Fixed Income Fund, which we mentioned earlier, works a lot like a fixed annuity in that you receive monthly dividends, or payments, after your principal investment. Those monthly payments can last anywhere from two years to 30 years, based on what type of investment strategy suits your lifestyle at the time. But, how we differ from annuities is both simple and genius.
The Fixed Income Fund focuses on buying real estate and trust deed loans in historically stable markets, and then pays out returns to our investors based on the interest payments made on those mortgages monthly. Even better, the rates associated with the Fixed Income Fund are locked in throughout the maturity of your investment, meaning it will never change even while market interest rates fluctuate.
Our annuity-type investment is able to do this, as well as come with zero investor or management fees, because we target loans with valuations that are significantly higher than what we pay out.
Imagine being able to receive a reliable, steady stream of income each month akin to an annuity or real estate investment, without having to deal with the hassles of rental properties, market rates, and other headaches.
What could a supplemental stream of income do for your budget each month? A whole lot, we imagine.
If you’re ready to find out, contact Tactical Wealth today to see if you might qualify. Get peace of mind with a well thought-out budget and a high return investment you deserve.
