49% of Americans live paycheck to paycheck, 4 financial tips to stop running that race.

Do you feel like you’re running the financial month-to-month marathon? If so, did you know most of your peers are in the same situation  (I know it doesn’t feel any better, but you’re not alone)! According to a CNBC article finding more than 49% of people are living paycheck to paycheck. Almost half of all people fall in this category!

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We’re an honest company and this article will not provide “golden advice” or provide you Aladdin’s genie’ x/y coordinates, but reasonable tips that will save cash, and restore your financial confidence for when diaster strikes.

The best financial advice I’ve ever read  – “All decisions you make should help you move from being a laborer to being a capitalist.(1)”  To better emphasize this point I’ll copy the section verbatim. As a laborer, you are paid a wage for your services. It does not matter if you are police officer, factory worker, doctor, lawyer, or clerk. You are paid a wage for doing some form of work. You are exchanging work for money. As a capitalist, you are paid not for the value of your labor, but for the use of your money. This comes in interest, dividends, or price appreciation, but in one way you are being paid to allow others to use your money. (pg. 11 of Your Money Ratios for Financial Security).

Ok, so how’s this help? Well, first we need to figure out why we’re working in the first place and ultimately what we’re trying to achieve with our earnings. If you’re like the 49% of American’s your in survival or stay afloat mode, but this sentence (1) could help you re-identify how you’re spending, saving, or using our resources we work hard for.

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So here’s our 4 financial tips : 

1.(INVEST) Create an Acorn account. This site links to your debit or credit account and round’s up your change to a separate investment account (you pick your portfolio type). It’s definitely a millennial thing, but there’s other advantages as well such as: set-up monthly transfers, incurs interest through investments, and rid’s the old coin jar underneath your bed (which is losing value to inflation!)

  • Theory: $25 a month/$6.25 a week -$15 monthly transfer with change roundup

2. (SAVE) Create an Ally.com account. Create an online savings account (yield’s currently at 1.45%) and give it a nickname – emergency fund, Kyle’s college, or new roofing system. The charges are low and some accounts don’t even have them. This online banking company keep’s your hard-earn money out of sight, while planning for your next expense and start small 5$ a month.

  • Theory: $5 a month/$1.25 a week – $5 monthly transfer

3. (DEBT) Trade your monthly car payment in for a reliable vehicle vehicle and preferably a gas saver. According to an article on the financial website Motley Fool over 40% of American’s have a car loan.  The average monthly car payment was $503 a month (2016)!  $503 a month is almost 75% of the average monthly grocery bill for a family of 4! 

  • Theory: $503 a month/$125.75 a week – No car payment so you’re making $

4.(RETIRE) Common misconception “I can’t survive the month, let alone think about when I’m 70!” OPEN A ROTH IRA ACCOUNT!!!! IF YOU DON’T, PLEASE LET ME USE IT! This allows you to save up to $5,500 a year and invest it in the stock market! It’s all post-tax dollars, so when you withdraw when you enter in retirement and you don’t have to pay interest on the appreciation or dividends

  • Theory: Reallocate 50% ($251.50) of the car loan to a Roth account & rest in emergency account ($251.50)

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Here’s a recap of your 2018-2019 year with these tips

Invest Segment – $300.00 – Acorn.com

Saving Segment – $60.00 – Ally.com

Retirement Segment – $3,018.00 – Roth IRA Account

Emergency Repairs/sitaution – $3,018.00 – Savings account (2nd Ally. com Account)

Yearly breakdown = $6,396 in potential saving’s (excludes interest, dividends, investment decisions.

 

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Solving the “but I recently bought the house” question.

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Every contractor encounters client’s who begin the conversation with “but I recently bought this house” dilemma.  Generally this opening line occurs once the homeowner  discloses an ongoing problem such as: leaking roof, damaged drywall near windows, and etc.  Personally, I’ve already encountered this scenario 4 times and year is not over. So why is it prevalent that many homeowners seem confused about product lifespan or is homeownership not projected properly?

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Understanding US Housing statistics:

The average individual in the United States purchases between 3-5 homes in their lifetime (starter home, family home, downsizing home, retirement, etc.). Generally this much exposure to properties (under the expectation – not all homes were newly built) mean’s you’ve already had an issue or will experience such an issue in your lifetime. So we provided key insight’s (common knowledge) and a few “nuggets” to prevent calling a contractor a year after the closing. So how do you protect yourself from being like one of my clients?

First thing: Understand what homeownership means:

Review the true demands of homeownership and begin reviewing the expected costs of lawn maintenance, seasonal maintenance, change your books of choice from the Dark Tower to DIY stuff. A great insight is to compare renting vs owning materials.  Keep in mind, a home is similar to car minus the rapid deprecation, but the components that make your house very much depreciate and deteriorate. These items include: AC units, Water heaters, siding, windows, carpet, light fixtures, and roofs!

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Second thing: Before buying a LEMON do these items:

  1. Understand your true price and what you can afford (Yes, you can afford the listing price, but what about the soon to be updates). It’s better to avoid being “home broke” and have the ability to save reserves for those future expenses. This doesn’t mean because the bank approved us for the larger loan we should over reach on sq. footage or the home with a pool.
  2. Complete Professional home inspection – eliminate minor headaches or possibly discover huge unknown issues.home inspection.jpg
  3. Ask the “how old” questions: (Roof, siding, windows, door, heater, ac unit, flooring, & more).  Common questions such as these will allow you to compare to the chart provided below and see where you stand.
  4. Read our cheat sheet:
    • Asphalt Roofs – 13 to 17 years in the Midwest (due to harsh elements)
    • Aluminum siding – 50 years
    • Vinyl siding – 25 to 30 years
    • Aluminum windows – 15 to 20 years
    • Vinyl windows – 20 to 40 years
    • Carpet – 3 to 5 years (once fibers are worn & frayed)
    • Exterior doors – 20 years
    • Wood flooring – up 75 years
    • Linoleum flooring – 25 years
    • Garage doors – 15 to 20 years
    • Furnaces – could be 15 to 25 years
    • Water heaters –  10 to 20 years
    • In-ground pool liner – 7 years
    • Skylights – 15- 20 years
    • Contact your local neighborhood contractor for insight. If your curious about the current pricing for a specific product contact the local guy or Total Roofing & Construction ;). A lot of contractor’s provide Free estimates and more times than known will give you advice that maybe worth more. We advise doing this long before you actually need the work completed (6 to 18 months ahead of schedule). This allows you to budget for such a project and not be burden with burning your emergency fund or adding more debt.
  5. Homeowner Insurance Policy knowledge
    • We always recommend reviewing your newly acquired homeowner policy after you make your purchase. This policy is what will protect you from serious issues and your solution to those out-of-blue emergency situations. Important items to understand is your deductible, covered perils (hail, wind, etc.), and claims process.

Third Thing: If you did your research, don’t panic.

If you have completed the recommended tips mentioned above or currently purchasing your fifth home, then don’t panic when disaster strikes. Generally whenever you have sudden damage it’s commonly storm or weather related (covered by your homeowner insurance policy) – contact a company seasoned in restoration work (TRC).

When speaking of interior damage that didn’t arise from exterior damage – water heater, sump pump, furnace, and etc. these are preventable with seasonal maintenance and a planned schedule on replacing such items. If you over spend and don’t budget for yearly renovation then yes, you may be in pickle.

 

Conclusion:

I can attest that all contractor’s will offer you assistance regardless if your a homeowner of 5 months to 50 years. However, we believe these steps can save you ENORMOUSLY before you’re closing on a property or when that  disaster strikes. For instances, the Hurricane Harvey is a sad and frightening situation for many reasons (safety, families affected, shelter, & etc.). However, a question we ask is did all those homeowners have flood insurance or covered peril to protect their damaged homes? A lot of us never consider scenarios such as the Hurricane Harvey, but its better to be safe than sorry.

Hurricane Harvey

If you have any questions please message me at pctotalroofinc@gmail.com