HOW TO BEAT THE BANK

When you think about “The Bank” what comes to mind is it “money” or “security.” In this post I want you to see the bank as it really is, (infrastructure).

To beat the bank first you have to think like the bank. If you want to be successful, just study how banks make money.

Let’s start with the terminology (words used in banking).

Debit & Credit

Debit, is an entry recording an amount owed.

When you take out $100 from your account, the bank will debit (pay) you $100.

Credit, is the ability to borrow money

So when you save money into a high yield savings account or CD at the bank. The bank is receiving credit (a loan) and in return they give you interest.

If you don’t know what a CD or high yield savings account is then you can click on this link to learn more

How Banks move money

When you save your money in a bank they lend the money back out through credit cards and loans. The bank will also stay liquid only a certain amount for you to make a withdraw.

So in other words the bank will borrow your money and give you 0.006% interest. Afterwards the bank will lend you, your own money through a credit card or loan and charge your anywhere from 5 to 29 percent interest.

How to Compete

The only way you can compete with the bank is by making riskier investments and utilizing everything you have while your still young and cut cost to budget more of the money to the side.

One of the most innovative ways to invest your money now is in crypto, but don’t jump into an investment without knowing enough to base a decision off what you know.

“The more you learn, the more you earn”

Someone quoted this before and people don’t know how to utilize this quote today. This quote is for investments and business, so go out there and learn something NEW!

Thank you for reading

The Way I Save

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KNOW THIS BEFORE GETTING LIFE INSURANCE

On the last post about life insurance I presented three questions you need to ask yourself before getting life insurance.

In this post I’m going to be answering each post so that you know enough to get your very own life insurance policy.

What does the insurance company get in return?

I’m sure you asked the question “how much does the insurance agent make on a life insurance policy?”

Of course the agents wouldn’t want you to know this, but the average Life insurance agent receives 95 percent of what you pay the first year in a policy. When you renew your policy they receive 5 to 10 percent in commission on the policy for the next year.

What types of policies are out there?

There are so many life insurance policies, but they all stem from the two major policies Whole life and Term life.

Whole life

This policy is built to spread the cost of coverage throughout your life span and it is solely built off of your contribution so it is more expensive.

The benefit of “whole life” is that it does not expire and has set payments. Also as long as you make the proper payments on the policy the insurance company is bound by the contract agreement.

Another benefit of “whole life is that the policy builds cash value, which means you can borrow against the policy.

CONS: This policy is expensive.

Term life

This policy is built to cover you over a specific period of time usually anywhere from 10 to 20 years.

The benefit of “term life” is that it tends to be six to ten times more affordable than a whole life policy.

Another benefit is that “term life” can be converted into a whole life policy giving you full life long coverage.

CONS: This policy does not hold a cash value and will expire.

Which policy is the best for you?

My personal opinion is that term life is better because of how you can convert the policy into a whole life plan, but there are cons for doing that. Such as, the policy gives less coverage and if you withdraw money from the policy you leave less for your family after you pass away.

The best policy would be whole life, if you can afford it the policy has no expiration date and holds a cash value. So you don’t run the risk of getting nothing from your insurance policy.

Thank you for reading

The Way I Save

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INVESTING MADE EASY

The key of making money in stocks is not to get scared out of them.

Peter Lynch

The hardest decision you can make is picking something to invest in, but this process can be simplified the more you invest.

Peter Lynch is one of the most iconic investors that simplified investing for average individuals, just by suggesting people to invest in the things they love and understand. Which begs the question why arent you investing in stocks today, and for those who are invested why arent you investing more.

Just start

Just to get this through your head, the hardest decision you can make is the decision to simply start investing. The more you procrastinate the more your missing out on passive returns, and the best way to learn how to invest is simply through experience.

So many entrepeuners will tell you the best way to learn a trade or a new skill is by trail and error (just hurry up and fail). The bigger the fail the better the outcome, remember after every failure ask yourself “why didn’t this work” or “what did I do wrong.” Asking these questions will help you over come the struggles of investing and come out a successful investor.

EQ

When your investing the second most difficult task is keeping your emotions in check. When I began investing the was a company that I had my eye on and I originally bought stock in this company was very innovative because of the their eco approach (how they helped the environment).

Well over the years I saw the stock go up and down, it was like a roller coaster ride. I couldn’t stomach the fact that I could loss everything so I got out.

That company was “Tesla”

If you believe in a company, all you need to do is to first study the background of the creator of the company. If I would of known that “Elon” first created “x.com” I would have realized that he was successful before Tesla.

Only knowing what you need to know helps build emotional intelligence.

Caleb Peters

So remember to hold on, no matter how risky the ride gets because your first decision is normally your best decision.

Thank you for reading

The Way I Save

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WHY DO PEOPLE GET LIFE INSURANCE ?

We’ve all have been approached by someone selling life insurance. Personally I have been approached by random guy at 12pm in a Waffle House selling life insurance, but what is the actual reason why some people purchase life insurance and should you purchase life insurance too?

Is life insurance a scam or real

Depending on which company, life insurance can be a scam, it’s almost like a legal “Ponzi Scheme“. Companies who sell life insurance use multi-level marketing, which means to be an employee you have to be a user of product and the only way to make money is to invite more people.

The real life insurance side works through the customers life span which means, when an individual purchases a policy someone else is cashing out. To be honest all life insurance companies are like this, but it doesn’t change the fact that life insurance is important.

What does it do

Why is life insurance important? Picking a policy is important because of the way our society is nowadays.

Individuals are simply not able to save for their retirement because of the debt that is made by them or their parents. Unfortunately, When you or your parents die they can either leave you with a legacy of wealth or debt, and in many cases its always debt.

Now what life insurance does is take your contributions and a portion of your money goes towards funeral cost, but that’s not all it covers and depending on your policy you can leave your kids with a lot of money.

So now you found out how to turn your kids into trust fund babies, congratulations.

Know before you own

Those few things you need to learn before getting a policy are:

What types of policies are out there ?

Which policy is the best for you ?

What does the insurance company get in return?

And I will be able to answer all these questions in my next post so stay tuned and keep reading.

Thank you for reading

The Way I Save

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QR CODE

HOW TO CREATE PASSIVE INCOME?

Passive income is not always easy to develop ínfima to you might lose money trying to create it. So in this post I want to show you how I currently make passive income and how you can start creating passive income for yourself.

Keep in mind it is not easy to create passive income with that in mind, what ever trade you want to go into, study first by reading books. This will reduce the risk in creating passive income.

STOCKS

Stocks can be one of the most passive investments, depending on how you invest. I prefer investing for the long run because slow and steady wins the race. So one of the main factors I like to see when I invest in stocks is dividends.

Dividends are company earnings that are annually distributed amongst shareholders.

Also in some cases dividends is handed out monthly, so make sure to really study your stocks by using www.sec.gov. From the SEC website you can search up company records, all you need to do is go to the search tab and type in “EDGAR SEARCH,” once land on that page type in the company’s name or ticker symbol.

HIGH YIELD SAVINGS ACCOUNT

High Yield accounts are easier to find but to make a significant amount from interest, you have to have over $10,000 in the account in my opinion. These account are made to give you higher returns compared to a regular savings account or bank account.

Remember this is less risky, when it comes to making passive income, so the returns are not really as big as stocks. What I suggest is to create an account just so you can have money ready to use for convenience but still have money working for you by paying you interest.

ROYALTY FEES

There are plenty of places to collect royalty fees, just to give you an example for “The Way I Save” one of the sites that the blog collects a royalty fee from is merchandise. Teespring is a good site to create graphics that can go on any product and if someone purchases your product you collect a royalty fee.

Now each product can give you more or less money the profit margin varies, but it’s fun and simple to set up. If you want to see an example on how it looks click over to the products page of “The Way I Save” located on the menu tab.

What is a P/E Ratio?

So I don’t know about you but P/E ratio is very important to me, which is why in this post I want to break it down to you on why it’s important and what it is.

I can tell you firsthand P/E ratio has changed my way of thinking when it came to investments, because it allowed me to learn more about the company in general.

P/E RATIO IS…

The P/E ratio is a simple break down of the business answering one question “Is this company profitable,” but just as a disclaimer there are other ways to tell if a company is profitable.

Just by looking at the P/E ratio should give you and indicator of what the company is worth and if it’s overpriced. As my rule of thumb I like to look at companies that have a P/E ratio less than 15.

WHY IS P/E IMPORTANT

P/E is important because the only reason investors buy stocks is to receive dividends or increase their capital. If a company has been profitable for 5-10 years and would you invest in that company?

Each sector has a P/E ratio that sometimes averages higher than 15, which doesn’t always mean their over priced. I particularly like to receive dividends and the companies that pay a good dividends are usually undervalued. The reason undervalued companies pay is because they need more investors to help fund their expansion. So to keep the investors happy the undervalued companies hand out dividends so you won’t leave.

I hope this post helped you out.

THANK YOU FOR READING

THE WAY I SAVE

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Simple Money Management

Every good business and rich individual knows how to do one thing very well. Successful people probably don’t touch on this topic a lot, but the route of financial success is simply good money management skills. Managing your money can be difficult at times, but although it’s difficult it can be simple too.

This post is going to be dedicated in showing you simple ways to manage your money, so that you can have the keys for success.

PAY YOURSELF

I know a lot of influencers talk about paying yourself but they don’t particularly share how they pay themselves.

these are the ways I pay myself weekly and sometimes monthly:

• my 401(k) plan

• buying stocks

• other investments.

Essentially I take whatever is left in my savings accounts and use it to do one of these three things. Now since my 401K is already taken out of my paycheck, I really just use my savings for the other two.

SYSTEMS

I know a lot of peoples method or system when it comes to their personal finances, is to simply cash the check and stuff it in a box. Cashing your check is the worst method or system you can use, as Grant Cardone says “cash is trash.”

This is true because it doesn’t pay to have cash, it pays to have assets.

My personal method or system for handling money, is to deposit everything I make into my savings account. All I do is deposit and transfer for bills, that way after paying my bills I’m able to see what’s left for possible investments.

You don’t have to use this method, all I’m saying is that this works for me so you should try it and see if this system works for you. You can create any method or system for yourself as long as your know how you spend money.

These are just a few concepts I use I hope this helps you when it comes to your personal finances. Like I said from the beginning managing money can be difficult but also simple, so I hope these concepts were simple enough for you.

You can let me know if these concepts work by leaving a comment on this page.

Thank you for reading

THE WAY I SAVE

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The Importance of EPS

When it comes to choosing a stock EPS is the most important thing to look at before investing and in this post I’ll give you reasons why its important and I’m going to explain what EPS is.

Well for starters EPS stands for earnings per share.

WORTH

One of the main reasons why EPS is so important, is because EPS will let you know whether or not a stock is worth investing in.

A higher EPS shows investors that a company is profitable. When a company is profitable it’s more likely that the investor will receive dividend payments from the company.

DEMAND

When the “earnings per share” increases 25 percent, it also reflects a higher demand from the company. This can be because of the rising popularity of the company or an increasing need for the companies products.

For example, have you ever heard of “Zoom” before the pandemic. In 2020 the eps for Zoom was calculated at 0.27, in 2021 it went all the way up to 2.91, that’s over 25 percent.

CONSISTENT GROWTH

When the earnings per share for the company increases each quarter it represents future profitability for the company or consistent growth.

Before I purchase a stock I look at the estimated earnings per share and the actual earnings per share for each quarter. If a company passes its estimate earnings each quarter it shows The consistency of it’s performance.

Their are plenty of other reasons why EPS is important but these are the main reasons why you should pay attention to a company’s Earnings per share.

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THE WAY I SAVE

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How to Leverage your Money

I’m sure everybody’s heard of the saying buy low and sell high and that’s not just for the stock market that’s for every single thing you purchase. In this post I want to let you know about ways to leverage your money. I’m going to be sharing the ways that I personally have considered or successfully done myself.

BOOKS

So without further ado the first way to leverage money is with books. I have personally invested in several books like for example stock market 101, The intelligent investor, and the richest man in Babylon. With this investment of $57 in just these three books, I have made over a thousand dollars in 6 months.

This is just one example of how reading or listening to books can actually leverage your money. I am still utilizing the information used in these books today, which is also proof that it is a long term investment.

COURSES

When it comes to courses it is another way to leverage your money, but you have to be careful when it comes to choosing of course. I say this because there are courses that charge an arm and a leg for information that could’ve been provided somewhere else cheaper.

Also you have to be strategic when choosing a course what course can you take that can translate into more money for you. For me it was taking an accounting course to help increase my know-how of budgeting and maintaining my personal finances.

MENTORSHIP

Finding mentorship can be priceless and offered for a little to no cost, but there are people in places that charge you for their mentorship.

My advice is to start start with who you know and find people who invest their money in particular ways.

For me I have found plenty of mentors to draw near to who invest in real estate that are not only willing to share what they know, but are capable of partnering with me on deals.

Thank you for reading

The Way I Save

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