Category Archives: Finance

10 Steps Everyone Must Take to Get Rich

The millennial generation is at the point now where they’re starting to think hard about how to build long-term wealth for themselves.

When I was young, I was really bad with money, but now I’ve learned that when it comes to building personal wealth, often the best strategies are the simple habits that, when properly implemented, end up paying off big in the end. The challenge, of course, is that financial responsibility is not always easy when bills are piling up and you feel as though you don’t have the ability to save. But part of building wealth is learning to discipline your spending habits so that you are always operating in the positive — instead of racking up debt.

If building true wealth for yourself is something you’re interested in, these 10 steps will be your foundation for establishing positive financial habits that will move you closer toward your goal.

1. Never operate at a loss.

The most simple step toward building wealth that people struggle with is spending less than they make. It might seem ridiculous, but it’s the truth — many people spend more than they make and float the difference on credit cards. They assume they will make more in the future and that it will all “even itself out,” when in reality, the moment they start making more money, the more they spend.

The bad habit stays, and they continuously operate at a loss.

2. Place a tax on yourself.

If the government suddenly increased taxes and forced you to pay an extra $100 each month, you’d find a way to pay it. You would have to. Yet when it comes to saving money, people constantly find ways to rationalize their inability to sock away $100 each month.

Set up an automatic bank transfer so that as soon as you receive your paycheck, a small portion of it immediately goes into your savings account. You should pretend it doesn’t even exist. And a few years from now, you’ll thank yourself.

3. Open an IRA account (to accumulate interest tax free).

One of the best things a young person can do is open an IRA account, which can double as either a primary or secondary savings account. The intention here, however, is that money is not touched until much later in life. If you withdraw from it before the age of 65 you are penalized. The bonus, though, is that your money in an IRA account can grow tax free, which compounded over three or four decades ends up being a lot of money.

4. Don’t play the stock market.

Unless your day job is trader, don’t try to time the stock market. Don’t think you’re smarter than the stock market. Don’t think you know which stocks are going to do well and which ones are going to do poorly. To think that you can do casually what some people make their entire careers is naive and reckless. At best, it’s gambling.

Instead, invest a portion of your money that you’re willing to lose in companies you like and want to hold on to for years to come. It’s best if you make these decisions with a financial advisor, and even better if you purchase these long-term options inside your IRA account. That way, your gains remain tax-free.

5. Build a side hustle.

Even the world’s most successful entrepreneurs have side hustles. According to Warren Buffet, the average millionaire has seven sources of income. Having multiple income streams is just part of the process.

The best thing you can do is figure out what you can provide or offer people that delivers true value. A perfect example is internet famous entrepreneur Sam Ovens, who has made millions selling online courses and consulting business owners.

“The big lesson I learned is that you have to sell something that the market actually wants,” he told The Epoch Times. Simple, but that’s how it should be.

Bonus: If you can refrain from spending your side hustle money and save it instead, you’re in remarkable shape.

6. Always pay off your credit cards.

No matter how entrepreneurial you are, maxing out your credit cards without reliable streams of income to pay them off in a timely manner is irresponsible.

You always want to make financial decisions based on what you’re currently making, not what you think you’re going to make. Wait until you’ve got the money in the door before you go reinvest or spend it. Otherwise, you’ll find yourself drowning in interest payments.

7. Set financial goals at the start of each quarter and year.

When you have a goal, you tend to be more responsible with your money. It’s when you don’t have a goal that it’s much easier to rationalize spontaneous purchases.

At the start of each year, set a big goal for yourself and then break that goal down into three-month increments (quarters) so that you can check on your progress as you go along. These smaller goals are what help the larger one seem more attainable, and will give you a sense as to whether you’re on the right track along the way.

8. Follow the 50-30-20 rule.

Summarized in a great article by Nerdwallet, many financial experts suggest that 50 percent of your income should be spent on needs (such as housing, car payments, food, etc.), 30 percent should be spent on what you want (clothes, nice dinners, etc.) and the remaining 20 percent should be saved.

Especially when you’re young, you’re most likely going to operate closer to 70-20-10, living off 70 percent of your income, spending 20 and saving 10. If you can even follow that, you’re in good shape. But your goal should be to work toward following the 50-30-20 rule.

9. Surround yourself with financially responsible people.

Nothing breeds financial success like hanging out with people who have already attained it. This means finding people older than you that you can learn from and also making sure that your group of friends is comprised of people who share similar financial goals. It can be difficult to adhere to financial disciplines when you’re spending time with spontaneous spenders.

A great way to learn about the art of finances is to find a family friend who can mentor you throughout the process — someone who has achieved their own financial success. If you show an earnest interest in learning how to build the same for yourself, chances are someone will be happy to help. A willingness to learn goes a long way.

10. Judge yourself over the year, not the month.

While it is important to keep a tab on how you’re doing month to month, it’s far more important to judge success over longer periods of time. A year is a good indication of your financial practices. Some months might not be great (things happen), others might be wonderful.

But what’s important is that, come the end of the year, you saved at least 10 percent of your income. Otherwise, if nothing is being saved, how do you expect to build true wealth for yourself?


Entrepreneurs Don’t See Business Financing the Way Lenders Do and It’s Costing Them

Starting a business is no easy feat. Many entrepreneurs are experts in the products and services they offer, but running a company requires a wide range of duties. This can include topics well beyond their expertise, such as making key decisions about securing business financing.

To better understand how entrepreneurs feel about pursuing and using business credit, we at Wells Fargo conducted a national study of business owners. What did we learn? A few findings stood out from the rest. They reveal some closely held truths and also offer insight into how the financial-services industry can help entrepreneurs use credit responsibly.

 Startups have more financial stress.

Nearly one-third of small-business owners running startups said they’re highly concerned about having enough money to meet their business goals. Another one-third indicated their financial situation is a significant source of stress.

Managing finances can be one of the most challenging responsibilities for entrepreneurs. When used properly, business credit can provide the necessary capital to manage fluctuations in cash flow. That increases a business owner’s ability to pursue opportunities to improve and grow the business. Entrepreneurs must understand their credit options so they can take advantage of financing structures that meet their needs and goals.

It’s the banker’s responsibility to make it as easy and clear as possible for business owners to decide which option is best — and why. In general, credit cards are most appropriate for everyday business purchases such as supplies, office equipment or monthly vendor payments. In contrast, a business line of credit typically is used for several large purchases, spread out over time. A business loan is a good option if the company needs to access all the funds at once.

Small-business owners have a limited understanding of what it takes to secure approval.

Only half of small-business owners strongly agree it takes time to build a strong credit application. Two-thirds believe their personal finances should have equal weight in business-credit decisions.

Deciding if and when business financing is right for your business can be a tough call. Before approaching a lender, business owners need to understand some of the key factors that will be used to evaluate their credit application:

  • Credit History: How has the business owner managed previous credit?
  • Ability to Repay: Is the business profitable, and does it have positive cash flow?
  • Capital: Does the business owner have enough investment of personal capital in the business?
  • Collateral: Does the business owner have assets that can be used as collateral to secure a lender’s investment?
  • Business Experience: Does the business owner have extensive experience in the industry?

Business owners who better understand the factors used to determine creditworthiness can assure they’re working to develop a strong credit profile.

Small-business owners want to receive support throughout the process.

A strong majority of business owners desire clear and easy-to-access information before they apply for credit. During the application process, they want payment terms to be clearly defined. Predictably, they’re also eager for information on how to get approved and tips to maximize funding.

Financing a business without the right support and tools is a complex task. While some business owners are credit-ready, others need guidance on how to build a successful credit profile. The financial-services industry needs to educate business owners on what it takes to be approved for this funding. Only then will entrepreneurs be empowered to make the most of their credit options and realize the potential to grow their companies.

These are the very priorities behind Wells Fargo’s Business Credit Center. Our website includes free educational resources to help business owners understand and navigate the three phases of building credit: pre-application, the application process and after the financing decision. The online tools can help provide greater clarity and improve business owners’ ability to decide which credit options are right for them.

Small-business owners can benefit from consulting with bankers to determine the best solutions for their company. With the right tools and guidance, more entrepreneurs can become credit-ready and secure financing to help their businesses succeed.


3 Keys to Getting a Better Deal for Your Startup

As a startup, chances are, you are strapped for cash. This means you should always be on the lookout for the best deal. Whether it is to provide food for your office or to get to your next meeting, making the most of your money will be crucial to your success.

For employees and CEOs, finding the best deal often lies in the up and coming on-demand economy. What started as a way to hail private cars on Uber, has turned into a growing industry fueled by companies like Wolfie, which enables you to search and receive deals in real time.

Startups should be using startups to survive. As an example, on a recent business trip to Manhattan, I used Wolfie to find a great deal on a local Italian restaurant. What would have been an expensive meeting, turned into a half-off lunch because I utilized this platform.

If you’re like most entrepreneurs who are trying to make the most of what they have, utilize these three keys to make your money go farther than ever:

1. Don’t use the big guys.

Though it may sound counterintuitive at first, startups are often willing to give other startups a deal on their services. Even without the buying power of bigger companies, startups focus on growth, and therefore use most of their resources towards this metric.

As a example, Via, a new shared-ride hailing service in Manhattan, competes with Uber by paying their drivers more. Uber had a similar launch strategy when it first starting, yet as they’ve grown, their wages have decreased. Since Via is new and focuses on growth, they’re able to spend more to pay their drivers in order to expand.

2. Look for pain points.

When a business is lacking customers, they will be more willing to make a deal. As a startup trying to make the most of what you have, look for companies that could use your business. This will not only make the business focus more on your work, but will also probably come at a cheaper cost.

Wolfie utilizes this pain point that many businesses face. Every restaurant and bar has off times. When a user sends out a search for a Italian restaurant in an odd hour, businesses can address this pain point by offering a deal to the Wolfie user.

3. Think long-term.

A key to negotiation is going in with a long-term vision. Businesses prefer building lasting relationships, and if you can start a deal with that in mind, chances are you’ll be getting a discount.

For Baarb, a new platform enabling people to intelligently book travel, this is their exact plan to take on larger travel sites. Their platform focuses on building long-term relationships with customers by building unique travel profiles and custom recommendations through machine learning. The days of generic travel planning will soon be gone!

Though there are aspects of your business that are worth hiring a professional for, there are others that you should actively be looking for deals on. Being a lean startup involves knowing where you’re putting your money. Focus on finding ways to make the most of what you have, and growth will follow.


10 Money Habits That Will Help You Get Serious About Prosperity

The power of habit can be quite interesting. Rather than create 2017 resolutions that may not stick, a good alternative is to develop positive habits this year. Especially when the category is financial life.

So, make it your goal to form new habits that will take your financial life to the next level.

 From learning a new skill every day to hitting the gym regularly, habit takes away the one singular thing that prevents us from getting things done — resistance. With good habits, we no longer resist. We just do it.

You can quickly attain financial freedom by positively channeling the power of habit toward how you treat money. But, first, let’s look at the steps to developing new habits.

Author James Clear breaks down habit formation into three steps (the three R’s): reminder (what triggers the behavior); routine (the habit itself) and reward (what you get from this behavior). In order for a habit to stick, it must follow the three R’s rule. By practicing some of the following habits, your reward will be a more financially rewarding lifestyle.

1. Be clear about your financial goals.

One habit you need to develop is clarity toward your goals. Your goals can shape your attitude toward whatever you do and put you in the right perspective about your financial life. Lack of clarity is equivalent to having no goals at all.

“Clarity about your money goals is the first step towards getting your finances right,” Yasir Khan, founder and chief editor at, told me. “Getting your finances right — being able to prioritize what you do with your money — can only be achieved by clearing the unnecessary obligations out of the way.”

Developing a habit of being clear about your financial goals will also create a sense of focus, which is the psychological effect of setting goals. Let’s assume your aim is to start your own business this year. You’ll outline how much funding is required to do that, and how much you want to raise yourself.

2. Stop associating guilt with money.

One habit which keeps a person from growing financially is how he or she feels about money. A lot of people feel guilty, which is why they often find it difficult to discuss the financial terms of a business relationship before starting one.

Develop a positive attitude toward money this year by overcoming any guilt you feel about money.

3. Seek more income sources.

The best way to improve your financial life this year is to use your free time to earn an extra income. Start by looking at areas where you can fill a need and earn extra money in the process.

And make converting your spare time into income opportunities a habit. You could freelance for businesses or help people with things they can’t do themselves. Khan said he was able to start two small businesses apart from his main job when he noticed he could use his free time to help others. Now that his side businesses are growing, he hires people to help him run the business.

4. Make clearing your debts a priority.

One of the biggest hindrances to financial growth is debt. The problem is that debt keeps compounding, making it your most expensive liability. Start paying off your debt with each paycheck you earn. By forming this habit, you could become debt-free by the end of 2017.

5. Save to secure your future.

Make saving a habit in 2017. The more you save, the more you’ll have when you retire. JPMorgan Chase puts together an annual guide to retirement that provides investment and savings strategies for all stages of life.

6. Separate friendship from business.

Underscore the purpose of your relationship with others, and make it a habit to always separate money from friendship and friendship from business.

A lot of relationships have gone to ruin because of money. In 2017, be careful when forming business relationships. Make sure you know enough about someone before entering into such a relationship. Use background check tools like Check Them or Check People before a first meeting. Entering into a relationship with the wrong person could be costly or devastating to your financial life.

7. See money as a means, not an end.

Many people get the notion of money very wrong. Because we see money as the end goal, it affects our orientation about it. See money as what it is and what it’s meant to be — a tool, a means to an end. What the end is for every one of us may be different. For most, it might be happiness, while for others it’s simply a comfortable lifestyle.

8. Seek advice from money experts.

Develop a habit of seeking advice before making any major financial decision. This will help you avoid making any decision you’ll end up regretting. When you make a habit of seeking financial advice, you’ll be less likely to take financial risks that could hurt your lifestyle.

9. Decide against impulse buying.

Make it a habit to spend only on things you need. Cut back on impulse buying by weighing your options before making any purchase. When you buy on impulse, you only gain a temporary sense of satisfaction. Once this instant gratification has worn off, what you’re left with is a shrunken purse and a tinge of regret, or buyer’s remorse.

10. Live below your means.

Many wealthy individuals mastered the habit of living below their means, even before they became hugely successful. A lot of wealthy individuals prefer to live a frugal lifestyle.

Going frugal can help you create a financial lifestyle that’s easily manageable. It can leave you with enough money and time to invest into your business and relationship. And that’s what good money habits are all about.


Consider Crowdfunding at Your Own Peril

Crowdfunding made its much-awaited debut last summer to great fanfare. The new Regulation Crowdfunding rules enacted in May 2016 — designed to facilitate small-scale investment into private businesses — permit securities crowdfunding under the JOBS Act of 2012 such that anyone, not just accredited investors, can acquire an equity stake directly in a company. Yet despite the rapturous articles and frenzy of social media postings, early data from the Securities and Exchange Commission (SEC) suggests that capital raised under Regulation Crowdfunding is likely to remain a small portion of overall 2016 capital raised.

Regulation Crowdfunding was conceived to enable small companies to raise small amounts of capital from ordinary folks. The new rules allow companies to raise up to $1 million over a 12-month period, and investors are able to contribute up to $2,000 or a set percentage of their annual income or net worth (5 percent if an investor’s annual income or net worth is below $100,000 and 10 percent if it is above $100,000). The transactions take place over intermediary platforms, which face additional requirements for advertising and disclosure imposed largely to protect the investors.

 Initial data provided by SEC Chair Mary Jo White shows that only $4.4 million in funds was committed by investors under the Regulation Crowdfunding rules within the first two months. Additional Morrison & Foerster LLP (MoFo) research reveals that, as of the beginning of November, there have been fewer than 150 offerings raising an aggregate of just under $20 million over the 19 platforms regulated and permitted by the SEC.

So why has there been a slow uptake of financing through Regulation Crowdfunding, and what should you be thinking about? Here’s the most important question to ask yourself when determining whether to pursue a crowdfunding approach — Is crowdfunding good for your business?

The question often arises because entrepreneurs need initial capital to launch their businesses. The earliest cash generally comes from friends and family — and credit cards — but increasingly, entrepreneurs seek out incubators or accelerators that provide business guidance alongside of initial capital. Angel investors and high-net-worth individuals, either as individuals or through networks like Angel’s List, can play this role as well to varying degrees.

Arguably, though, some small startup companies may benefit from an increased investor base and easier access to capital that comes from Regulation Crowdfunding. Such democratized financing can enable new products, markets and businesses to grow and succeed organically with strong buy-in from its community and customers. This view also sees crowdfunding as beneficial to investors, and even society at large, since equity ownership is diversified among people who are often not direct shareholders or investors in companies.

However, Regulation Crowdfunding may not work for some startups, especially those with a social or environmental purpose, that are particularly uncomfortable giving away equity at such an early stage and for potentially little cash. So entrepreneurs — often those in consumer product markets — see crowdfunding as their last best alternative to bootstrapping. Beyond this, Regulation Crowdfunding also imposes the following potential significant issues that all startups need to think about and weigh when considering whether it is a worthwhile tradeoff for them before proceeding down this financing road.

Reporting requirements.

A company that elects to take advantage of Regulation Crowdfunding is required to file comprehensive documentation with the SEC before making a securities offering. The filing will contain extensive information about the company — including names of the company’s directors and officers, anticipated business plans, financial data such as debt and the company’s risk factors — and will be publicly available. In addition, the company will need to update this information once a year going forward, and file annual financial statements that may need to be audited. Finally, the company is required to file public “progress reports” disclosing material changes to investors for any crowdfunding securities offering that was not completed or terminated.

Additional costs.

According to initial assessments, there are likely to be significant administrative and accounting costs, much of which are due to the heavy reporting requirements discussed above. There will also be institutional costs. For example, all crowdfunding transactions must take place through a single “intermediary” — a platform that is SEC approved and registered — which may charge a fee or take an equity position in the company as compensation.

Promotion and advertisement.

Any public announcement about the offering, including advertising and promotions, are limited to:

  1. A statement that the company is making an offering (and the name of and link to the intermediary platform conducting the offering)
  2. The offering terms
  3. Contact information and a business description of the company.

A company may hire a promoter, but disclosure of whether the promoter received compensation is required on each communication.

Financing limitations.

For companies that want to raise small amounts of capital, Regulation Crowdfunding may be an attractive option. However, the new rules prohibit companies engaged in crowdfunding from raising more than $1 million within a 12-month period, which for many high-growth startups is prohibitively low.

Management challenges.

In addition to the limitations placed on the companies, there are also restrictions on how much each investor can contribute. Because each investor’s contribution is limited, companies will need to manage many more shareholders than they typically would in a seed financing round. Not only is it a burden on a small company to manage many investors, but institutional investors may not be inclined to invest alongside numerous unknown and unsophisticated shareholders. As a result, companies that take advantage of Regulation Crowdfunding may find it is difficult to bring in later stage capital when ready to scale — a critical issue since scaling is often an even bigger challenge for startups than finding initial seed capital.

To date, we have not seen any U.S. companies that have raised venture capital from outside funds after first raising capital under the new Regulation Crowdfunding rules — although a U.K. crowdfunding platform that crowdfunded itself did receive later venture capital support.

Investor relations.

Investing is about more than money since companies often seek strategic investors who can help them with introductions, future capital raising or business guidance. However, crowdfunding is unlikely to become a major source of deal flow for professional early-stage investors. The types of companies that are mainly utilizing these platforms are smaller slow-growth companies and — largely due to the financial limitations of Regulation Crowdfunding — are not the types of companies that achieve the scale/return that professional investors prefer. Because of this, a company that requires experienced and strategic investors is unlikely to find them on a crowdfunding platform.

Given all of the challenges noted above, many startups that had hoped to benefit from Regulation Crowdfunding may be better served by electing a more traditional venture capital approach. For some, if not most, the reporting requirements, costs and restrictions, management difficulties and the lack of professional early-stage investors in crowdfunding will outweigh the benefits. From our vantage point, the proponents of crowdfunding have more work to do before their ultimate vision is realized.


4 Reasons Your Personal Credit is Killing Your Business

There’s a common misconception that your personal credit isn’t going to impact your business. After all, your personal credit, is well, personal. Unfortunately, that couldn’t be further from the truth. In fact, when your personal finances get out-of-control, it can be extremely detrimental to your business. Here’s how:

1. You won’t receive loans

This is the most obvious reason. If you have a bad credit score because you have a lot of debt, failed to make payments on time or just haven’t paid your bills, that can lower your credit score. That means that when you apply for a business loan or credit card, you’ll get denied.

Even if you attempt to secure a favorable SBA loan and have a FICO score of over 700, you’ll be denied.

 What about alternative sources of funding? Friends, family and crowdfunding sites may not examine your personal credit, and most responsible business revenue lenders “will look at the past 6 months or so of a business bank account and determine if the business is an attractive lending risk based on the consistency of deposits,” says Nick Bentley on Ventury Capital.

2. Wages could be garnished

When you fall behind on your bills and aren’t able to make monthly payments, your account could be handed over to a collection agency or debt collectors who may choose to sue you. When that happens don’t be surprised if the collector tries to take a piece of your paycheck.

Now, garnishing wages isn’t allowed in every state and it can get complicated for those who are self-employed. Freelancers, for example, are exempt. However, if you receive an actual paycheck the creditor may try to take a piece of your pay.

Another thing to consider is if you’re side hustling to help you keep up with your expenses or invest back into your company. If wages from that side gig are getting taken out, that could prevent you from meeting your financial goals.

3. You won’t get approved for leases or business accounts

Think about the times you attempted to rent an apartment or get a new cell phone plan. Chances are that the landlord or phone company did a credit check. And, because you’re credit wasn’t in tip-top shape, you were denied.

The same is true when looking to rent an office space, lease equipment or secure something like a phone plan for your business.

This isn’t always a deal killer. However, if you have a low credit score you may be able to find some companies that will work with you. In most cases, if you have a score lower than 650, you may not be able to rent that sweet office space that will hold all of your new team members.

And if that wasn’t enough, your credit card can also be used to determine things think your car insurance rates.

4. You don’t have peace of mind

Finally, swimming in debt can be a stressful experience that can distract you from work and lower your productivity. Additionally, constantly worrying about your personal finances can result in loss of sleep. And, even worse, lead you to make poor decisions like raising your salary or using your business as collateral.

Another way that your poor credit score can occupy your mind is by causing a rift between you and your business partner. Even if they have excellent credit, your credit score could still bring down the amount of money that the business is loaned.

How to get your personal credit under control:

Despite having personal finance concerns, there are several ways that you can get it under control and improve your credit score.

Here are some of the top recommendations to accomplish that:

  • Establish a budget so that you can clearly see where you money is going each month and make the appropriate cuts to curb your spending.
  • Always make sure that you pay your bills on-time.
  • Pull your credit report so that you can resolve any outstanding balances or despite late payments.
  • Cancel recurring payments properly, like gym memberships that require you to sign a paper.
  • Don’t co-sign loans for other people.
  • Keep your debts low.
  • Apply for a D-U-N-S number to help improve your credit score.
  • Frequently monitor your credit to make sure that there aren’t incidents of identity theft.                                                                                                               original

5 Financial Mistakes Most Employees Make When Starting a New Job

It’s easy to get excited about the opportunities that come with a new job. The job comes with a paycheck — and sometimes even a much bigger one than you have had before. However, it’s easier than you think to make some financial mistakes when the prospect of a paycheck is right in front of you.

Here are five common financial mistakes that include a few errors I once made myself, but now know better:

1. Immediately making a big purchase.

I remember my first big promotion in my job. It came with a huge chunk of change that I never had before. I was so excited and felt so rich in that moment that I went out and leased myself a pretty cool sports car that came with a hefty monthly payment. However, with the new raise, I figured it would be no problem. It was okay at first but then there were repairs, more expensive auto insurance and extra pricey gas (premium only) that I had not accounted for. Before I knew it, any of the extra income that I had gotten from the promotion was going into that one big purchase, leaving me right back in the same tight spot as before.

The moral of the story here is — don’t rush out and immediately make a big purchase like a car or a home. Wait and see what that raise means to your monthly income and research all the costs associated with the purchase beyond just the main ticket item to see if you can actually afford it. And here is a novel idea: why not just save this raise for a while — say, six months?

2. Turning to credit.

While it would seem that people would turn to credit when they don’t have enough money, the most common behavior is to go get more credit when starting a new job or getting a raise. It must be the feeling that since they have more money, they can spend more money upfront and pay for it later when that new paycheck comes. However, it’s a huge financial mistake to get caught up in the web of credit card companies that offer you rewards, mileage and points just because you think you can now afford to use credit.

This financial strategy should only be used if you can pay off the item within the same period so as to not incur interest charges or carry a running balance. Don’t turn to credit when you get a new job. Instead, know that you most likely can save up for that item faster with that larger paycheck now on its way.

3. Not saving for retirement and emergencies.

The new job or raise sends some kind of message to your brain that is often a little inaccurate. You think that now you have more money, you’ll be fine should an emergency occur, or you can make up the difference later if you don’t put money aside for retirement now. What tends to happen is that no additional money is saved despite having more of it. There is still a short-term mentality in place that deals with only the day-to-day expenses rather than looking at the costs on the horizon. There’s a false sense of security that can really hurt you in the long run.

I see every new job as an opportunity to put more money aside each month into various savings and retirement accounts. It’s important to have the money there for what is always going to be an uncertain future, including the potential layoff or urge to create your own business. There won’t be any money to catch you or encourage you to leap if you haven’t already started setting aside a specific amount of money each month. I recommend personally that you have 12 months of cash set aside that you don’t touch.

4. Not assessing any additional tax burden.

Whether it’s a new job or a raise, it’s important to calculate what the additional money means to your income taxes and what you may possibly owe or need to cover in estimated tax payments. You may not realize that there will be extra tax and invoicing expenses related to the rise in income. It’s important to know what you are faced with before your accountant surprises you right before taxes are due in April. This will help you know how much to save each month to cover those additional costs rather than worrying about a strategy to pay Uncle Sam.

5. Not revising your personal budget.

Every time your income changes, you need to revise your personal budget. Or, if you still haven’t made what some consider a death threat, this is the time to get your budget put together. It’s one of the biggest financial mistakes all of us make regardless of whether we got a new job or a raise. We don’t realize that every new cost or income stream dictates a revised budget to stay on target and properly manage our finances. A budget is not a threat — but a gift you give yourself.

I used to take the approach that I’ll make a budget when I have time but then the budget never got done. Stop what you are doing and put it together right now, so you understand where and how you are spending money. You want to account for all of your money so you understand what expenses can be reduced in order to add to your savings and retirement, or to reveal to you exactly where you can cut your budget in the case of an emergency.

It’s easy to make these financial mistakes when you are sitting on Cloud 9 with that new job or promotion. However, it’s almost as easy to fix those financial mistakes now and not let them get in the way of creating greater personal wealth for yourself and your family.


New Way Of Investing

Thematic investing can be used in different contexts within the equity universe, but it typically comes down to a top down approach to investing.

This particularly for a market like India with such low participation in equity markets could be the way forward. It revolves around picking a broader theme without having the hassle of researching or segregating amongst the plethora of individuals stocks and managements that any particular sector might have to offer. This form of investing essentially diversifies risk and makes investor less susceptible to volatility that could be associated with one individual stock.

A farmer for instance could invest into a monsoon theme with the click of a button, this would allocate his funds to a bunch of stocks which are set to gain from a good monsoon and fundamentals of these stocks in turn are curated by professional set of managers. The themes could vary from benefitting based on GST inclusion to public transportation to investing in solar energy. For example, thematic based investment company like, allows you to pick from over 50 broad themes.

 Indians historically have favored investments into Gold and Real estate, investment in financial instruments has historically remained at under 5% in India, this when compared to developed markets like the US wherein penetration has reached levels as high as 85 %, this excludes us from global growth and diversification and leaves us vulnerable to changes in Real estate and gold prices.

In summary, we believe at products like thematic investment, automation and transparency in banking and lending practices are the way forward, this in essence could simplify and introduce the mass untapped populous to better investing practices. This remains the pivotal point of focus for us and we are investing in such products which could help us achieve our goal of increasing overall participation in the financial sector.


5 Ways FinTech Is Driving Advances In Insurance

We are now living in a tech-savvy world, where everyone ­– urban as well as a large section of Tier II, Tier III cities – has access to smartphone and internet. This has become the key to do everything, anywhere, anytime, with just few simple clicks and in practically no time. Consumer behavior and expectations are also changing, and so is the manner of evaluating and accessing goods and services. This has influenced financial industry including insurance and we can say that technology is disrupting the way we chose insurance products (of any type) today. The consumers are adapting to this change because of, inter-alia, the convenience and empowerment factor, which comes from ease, unbiased decision-making, and speed of transaction.

Because of  the rapidly evolving situation and aggressive demand by consumers, many insurance companies are partnering with FinTech companies  that provide solutions to catch up in broadening the spectrum of services and transactions that customers can do over their mobiles and other hand-held devices.

Such partnerships come with huge customer benefits:

Consumer Empowerment

What was earlier about just signing the dotted line as directed by an insurance broker(and no questions asked) has become about taking well informed and most importantly, independent decisions for the consumers.


Today, customers only have to key in their requirements at the insurance marketplace and check the eligibility criteria to get instant offers to compare all life, general and health insurance companies and thereafter buy the products completely online instantly. Technology is ensuring that the all the customized insurance offers available in the market are made accessible based on the customer profile on one screen, instant and real time, to help customers make the best selection.

Cost effectiveness

The online virtual nature of the marketplace does away with the need of brick-and-mortar structures and associated work force, bringing down the establishment costs for the insurer. This benefit gets transferred to the customers in the form of lower premiums and processing costs.

Data Security

Security is paramount when it comes to finance, and FinTech companies take a very serious view of security. A marketplace like, which has the highest data security standards in place and a no-spamming policy, makes the customer feel confident about transacting online.

Process Familiarity

Another convenience of the online model is consumer’s familiarity and acceptance to the process, because is it same as any other online shopping experience. For this reason, the pressure to innovate technologically is high in the insurance sector, and correspondingly, so are the expected returns.

On one hand, these potential benefits for customers are putting pressure on insurance providers to go digital. On the other hand, going digital can bring in several positives, and not just in costs, to the insurance companies themselves that they cannot afford to neglect. Partnering with an online marketplace is the first step that the insurers can take, as it is a viable solution that can provide substantial results with a low investment. Here are five excellent ways technologyis driving insurance and improving it for the better.

Products diversification

The online space is an impetus to the insurers to develop simpler and more targeted products that are easier to understand by providing a larger-than-ever platform that comes equipped with the tools to help insurers reach these products to the right audience.Such simplified products are important for not only first time buyers of insurance but also those who look for systematic savings. Moreover, such products are also lower in loaded costs and commissions and, hence,are a win-win for both the insurer and the insured.


Online presence increases touch points and reduces the costs both for the customers/policyholders and for the insurance companies. This shields the insurance companies from high operational cost pressure – something that is a cause of concern for most of the companies, except the top seven and few others. Unless they attain the critical mass of new business and have a healthy renewal book, profitability is still far away. Operating through brick and mortar offices across the country is not yielding results and the expected reach. A digital strategy, on the other hand, can not only increase the business reach but also take the company towards profitable growth.


E-KYC, E-sign and stamping, and finally e-policies are making steady inroads,and with the changing mind-set, the time is not far off when insurance will be purchased instantly with no physical paper exchange. Automated claim processing and upload of documents from anywhere anytime is becoming a reality that will help in processing claims faster.
Further, the proposed central repository for KYC and Digi lockers will also help all financial institutions to access the KYC records of a customer centrally as well as allow them to e-sign documents. A platform that allows you to provide your customers with all these facilities and more in a highly secure manner can make life much simpler, not to mention faster.


A platform like, which sees over 9 million visitors per month on an average, provides enormous visibility – something which you would be hard-pressed to replicate. This becomes true when one considers the cost factor associated with doing things in-house. Apart from that, the proliferation of mobile internet is rapid in both urban and rural areas. At, we have seen a lot of traction from tier-2 and tier-3 cities and the number of online visitors from these locations is growing exponentially. This opens an entire new geography for insurers to target without depending on brick-and-mortar set-ups.


FinTech is a rapidly growing sector. Moreover, the business model of strong FinTech companies, unlike other online service providers, is very stable: For instance, there are no discounting schemes to eat into margins; stock and inventory expenses to be factored in; or order fulfilment or distribution capabilities to be worked out. These and many more such factors increase the possibility of making the business profitable. So, partnering with a strong FinTech company with a credible strategy and a clear growth trajectory can prove mutually beneficial to both.

Hence, Insurance and technology partnership will defining the future of Insurance policy purchase as the advantages are obvious. These opportunities are strong reasons for Insurance companies to align their strategies and leverage FinTech to the maximum. And it is just the beginning. The future belongs to AI-based virtual insurance agent that can provide real insurance quotes and recommendations based on clients profile/need analysis and underwriting of policies on the basis of data provided by wearable technology, i.e., step and heart beat monitor, driving, calorie counters, exercise and other social habits of prospective consumer.Adaption of e-Aadhaar/KYC, selfie for photograph, Video-based IPV, e-sign, e-stamping of policies, and app-based policy management, all of which will virtually reduce human interventions at every stage as well as increase reach and turnaround time, is around the corner.

This is one of the reasons regulatory bodies such as the IRDA are working on policies and initiatives to increase the reach of insurance sector and online is one such means. Between the E-KYC circular of UIDAI and Web Aggregators regulations of 2013 to the Revised Guidelines on Insurance Repositories and electronic issuance of Insurance Policies in 2015 and the Exposure Draft of the Insurance e-commerce Regulations in 2016, the IRDAI has been enabling regulations like distance marketing, telemarketing, web-aggregation, e-insurance platforms/e-commerce guidelines (proposed) and e-insurance accounts/repository framework.

The FinTech sector, with its paperless, simpler, faster turnaround model will be a game-changer. As drivers of technology, a strong FinTech company would be leading this trend. The first movers in the insurance industry would be able to create a large channel in itself of online users and buyers. And why not, the advantages overweigh the traditional methods of selling and servicing. The insurance and FinTech sectors working together cohesively as one unit drawing on the strengths of each other can provide exceptional services to the consumers. Ultimately, that would be the biggest win for both insurers and customers.


With This Startup, India Is Showing An Interest In Online Jewellery

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With the increasing use of technology, today’s startups are coming-up with innovative ideas to fulfil the desire of masses. From shopping, to buying of grocery, everything today is done online. And if you thought jewellery would be one domain that would lag behind, you were so wrong!

Today, online jewellery in India is seeing a rapid growth, as Indian consumers are buying jewellery online, just like any other product of daily usage. Though the ticket size is smaller in number, but still there is a lot of scope to tap this market.

Sensing the opportunity, Arnaud Lorie, founded Joolz; an online jewellery community and a marketplace to facilitate retail jewellery. This startup is helping consumers to discover prices and options online and facilitate the offline process of buying the jewellery.


Born and brought up in Belgium, the diamond capital of the world, Lorie moved to Israel when he was 18 to join the army. He then joined his family’s company- International Gemological Institute (IGI), and has now been living in India for the past 3 years. After training in one of the largest diamond factories in Navsari, Gujarat for 12 months, he started working on this new business venture – Joolz.

Founded in May 2015 with total team of 9, Joolz is an India-focused community and marketplace that brings together leading jewellery brands on a single platform. The startup aggregates and curates high-quality jewellery inventory and offers its consumers an unmatched discovery and shopping experience.

Business Model

Joolz is more than just an online sales platform as it enables two-way interaction between jewellery buyers and sellers through discussion, discovery and education. It is accessible as a smartphone app on Android and iOS platforms and also via its website.

“Buying jewellery is so closely intertwined with Indian culture that the act of simply selling it online is not going to create any significant impact in the market. We, therefore, want to be the single biggest facilitator of jewellery commerce, whether online, or more importantly offline,” said Arnoud Lorie.

Funds Rolling In

Recently, Joolz has secured a funding of $500K as a part of its Pre Series A round led by ah! Ventures, to go with the other bunch of investors.

The current seed round was also led by Mahesh Ahuja, CEO, Brittman India, Powerhouse Venture’s MD, Peddu, Deepak Kasthwal of M&S Partners, ex- CFO OLA Cabs, PKX Thomas – ex Technology Head, Cleartrip’s Neha Shah and angel round by GSF Accelerator.

The venture plans to utilise these funds to boost operations, products, marketing and further build-up its team.

Commenting on the recent investment, Powerhouse Ventures’ Managing Director Peddu said, “What attracted us most was the company’s rich understanding of the jewellery space and the passion with which they are planning to transform the way consumers interact with jewellery, online and offline.”

Future plans

As offline jewellery industry is valued at over $40 billion, there is a huge opportunity for Joolz and other such startups to grow significantly,by using the untouched technological initiatives. Joolz specifically, plans to reach a new group of brands and investigate new revenue models, and not just remains a company that is solemnly focused on the online traction.

“The online jewellery market in India is expected to grow at $3.6 billion over the next three years, which in itself makes the sector a lucrative one to invest in. In addition to that, given the background of the founder and their in-depth understanding of the business, this enterprise has from the very beginning started off on the best foot possible,” said Harshad Lahoti, Founder and CEO of ah! Ventures.