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Emilie is a prolific blogger, and influencer inspiring millennial women to live financially, physically, and professionally fit lives. She writes about overcoming debt, while balancing trying to eat healthy, stay fit, and have a little fun along the way. She is a politics major turned data engineer who graduated from Princeton University in 2015.  She currently lives in North Carolina with her college sweetheart Casey who is currently stationed at Fort Bragg. She enjoys eating food, cuddling with her dog, and binge watching HGTV.

Create A Financial Plan Without Hiring A Professional

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You’ve probably heard lots of advice about how you need a financial plan for your future so that you can retire with a healthy bank account.  But have you listened to that advice and started investing?  If not, it’s time to get started.

Many people avoid investing because they think a professional financial planner.  And most of people don’t want to spend the time or money to hire someone.

But, if you do your research, the only person you really need is you. A financial plan is not as complicated as you might think; you can create one on your own.

In basic terms, a financial plan should include your current and future financial situations and a plan for getting from one to the other based on your income, expenses, and any assets you have.  Here’s how to get started:

Know your current status

Create a list of your income streams, monthly expenses, and current assets to get a clear understanding of where you are and what you can expect to have for the future.  Review your annual budget and the most current credit card and bank statements to get the big picture of your debts, income, and monthly expenses.

Plan for the future

It’s hard to know what the future will hold, but you’ll need to make a plan based on what you expect to happen.  Sit down with your spouse or a friend and talk about your financial goals.  It always helps to have someone to talk about these things with and bounce ideas off.

As you’re creating your plan, work toward 5-, 10-, and 15-year goals to start.  What do you want financial picture to look like at these marks?  For instance, if you’re planning on buying a home in 5 years, you can start making a plan now to save for the down payment.

Mapping it out

Once you know where you are and where you want to be, the hard part is done.  Now it’s time to do some math and make a plan.  Your plan needs to include the financial goals you’ve set for yourself and how much you will need to reach these goals so you can lay out your map.

What are some small financial steps you can take to reach your goals?  Determine how much you need to set aside each month to reach your 5-10 year goals.  Follow this same step for all your future financial planning.  Be sure to calculate about 5-8% a year for inflation.

Now you’re able to make smart choices about your spending and saving habits based on your goals and your financial plan.

Review the plan yearly

Make time to review your plan each year as your goals, income, expenses, and assets may change. The numbers you used last year may no longer be current. Your plan may need to be adjusted to account for these changes.

Having a plan for your future is important so that you make informed decisions about how you spend and invest your money. Without a plan, you’re just hoping for the best and you’re not able to make good decisions that will benefit you in the long run.

How Much Home Can You Afford?

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Buying a new home is always an exciting time.  It’s a place to enjoy time with friends and family, a place where you’ll spend some quiet downtime, and maybe even a place where you’ll raise your kids.  But if you’re not careful, you can unexpectedly find yourself being “house poor”.  The term “house poor” refers to the many hidden costs associated with home ownership that many people don’t think about before purchasing.  Especially if this is your first time; you may not even be aware of these costs.  While your dream house may seem affordable, beware of unexpected expenses.

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According to Zillow:

  • The average home owner spends over $9,000 a year on maintenance expenses and other unplanned expenses
  • Home owners insurance, property taxes, and utilities can average about $6,000 a year
  • If you want to hire someone to help maintain your yard, clean carpets, or pressure wash your house, you can expect to pay about $3,000 a year for these services

If you haven’t added these items to your budget, you could find yourself in some financial trouble.  They account for as much as an extra $1500 a month to your budget!  That’s a lot of extra money.  And we haven’t even talked about furnishing your new home.  Those costs need to be added in as well.

But, don’t get stressed out just yet.  There are several things you can do to avoid finding yourself in house-related debt. When planning for a home purchase, keep these tips in mind:

Calculate all the costs.

Do your research to avoid becoming “house poor”.

There are several costs of homeownership that most people don’t consider. Be different!  Do your research and know the full picture.  While the mortgage payment may be well within your budget, you may be suddenly surprised at all the other expenses involved.

Research these extra expenses before signing a contract.

  • If your new home uses propane for heat or cooking, this is an added utility bill that you may not have accounted for. Depending on the size of your home, propane usage for heat can average $2000 – $3000 per year.
  • Not all homes have this service, but check to be sure.
  • The average water bill varies depending on the number of people showering and how often you do laundry or run the dishwasher.  But expect to pay anywhere from $80 – $200 every quarter.
  • The larger your home and the more things you keep plugged in and turned on during the day, the higher you can expect your bill to be.  Keep in mind that it will most likely be higher in the summer and winter if you run the air conditioning and heat.
  • Depending on where you live, this may be rolled in to your county taxes but be sure to check.
  • Property taxes. The cost of property taxes can vary depending on the area you live in. Most counties provide online tax records so do your research for the home you’re considering.
  • Homeowners insurance. Your mortgage company will most likely require this, but it can be rolled into your mortgage payment. Keep in mind though; this will increase your monthly payment.
  • Maintenance and repairs. Always have an emergency fund for anything unexpected.
  • Home Warranty. This will help to cover any major repairs, but there is usually a service fee for each visit on top of the annual fee, which can run anywhere from $500-$1500 a year.
  • Home owners association. If your community has a homeowner’s association, you’ll receive a quarterly bill for neighborhood upkeep.

Most prospective home owners can expect to be approved for a mortgage of around 30% to 35% of their salary before taxes.  But there are many other fees to consider.  Usually, your realtor or the sellers realtor can provide the average cost of these expenses for the home you’re considering so be sure to ask.

5 Great Ways to Make Your Tax Refund Work for You

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Tax season is wrapping up, and if you’re expecting a nice refund check to hit your bank account any day, you’ll need a plan for how to use it so you don’t waste it away. If the thought of that extra money coming your way is already burning a hole in your pocket, you may want to think about using it in a way that will be financially beneficial to you instead.

 

Let your money work for you. What does your current financial situation look like?  Can your refund check offer you a little more security? Here are some basic financial priorities that you may want to consider using your refund for.

Pay Off Those High-Interest Loans and Credit Cards

If you’re trying to work yourself out of debt, your tax refund can help you reduce or eliminate your high-interest debt that’s costing you more. Use your refund to pay off any loans or credit cards with a low balance.  Or, consolidate high-interest accounts and put your refund towards any transfer or early payoff fees to help eliminate paying more in interest.  Take a look at your high-interest student loans, car loans, or credit card debt and determine the best way to pay these down or pay them off completely.

Start An Emergency Fund

If you don’t already have a healthy emergency fund, now is the time to start.  If you do have one, but the balance isn’t as high as you’d like, your refund check can give it a healthy boost.  If you don’t have an emergency fund, you’re just one unexpected expense away from getting in debt. You should have at least six to eight months’ worth of your salary set aside. Saving that much can take months if you’re only able to set aside a little bit each month, but your refund can help you to quickly build that fund and provide some peace of mind.

Refinance or Make Improvements

If a lower interest rate is available it will help lower your monthly mortgage payment, but refinancing has closing costs and other fees associated with it.  Using your refund to refinance your home will save you money each month on your mortgage; money that can be better spent on something else.

If you have a good mortgage rate already, take a look at your house. Does your air conditioning system need to be replaced? Maybe energy-efficient appliances will help you pay less in utility bills. Making improvements around your home can significantly increase its value and make it more comfortable to live in.

Buy Life Insurance

When you’re young, you tend to feel pretty confident that there’s always going to be time to take care of the ones you love.  Life insurance is usually overlooked. But if you’re married and you have a family or you’re planning one, a term life policy will offer them protection should the unthinkable happen to you. For a few hundred dollars, your tax refund can make sure your family is protected.

Spend It On Something You Need

Is your car in need of repair? Have you been putting off a visit to the doctor’s office? Let your refund help you get these essentials taken care of.

Why spend all of your refund on things you don’t really need when you can use it to save you money and give you peace of mind?

How much diversification is too much diversification?

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We have all heard financial investors preach on the importance of having a diversified portfolio. Not only does this maximize our profit, but it also protects us from risk by having more than one type of stock. Diversification is important to our success in the investment world. However, how much diversification is too much? How many stocks do you need to own before you are adequately diversified and is there a magical number? There comes a point where your portfolio can become over-diversified. It is important to find and maintain a healthy balance of diversity.

What is Diversification and Why is It Important?

Diversification occurs when investors intentionally own stocks in different companies, industries and geographic locations. They are intentional about this in order to reduce their risks within the market. If one industry or location struggles, there is still balance and growth overall in their stocks and investments. They are protected.

This is important because the investor will have a healthier and more profitable experience. When one stock struggles, the others may thrive. This will help protect them from major drops in the market.

If you have ever heard the saying, “Don’t put all your eggs in one basket,” then you will have a better understanding of this theory.

The investor is choosing to have more than one basket, so that if one gets dropped, he doesn’t lose all of his profits. He is choosing not to depend on one stock or company for all of his success.

However, sometimes too much diversification can hurt you rather than help.

So…

What is the Magic Number?

According to the Modern Portfolio Theory, or MPT, your portfolio achieves maximum diversity when your purchase your 20th stock.  The MPT found, after strenuous research, that you can only eliminate your risk so much before it begins to plateau. This plateau typically occurs after your stocks add up to the sum of twenty.

However, remember that the number 20 is not magical on its own. Owning twenty stocks will not automatically give your optimal diversity and maximum profit alone. Instead, your 20 stocks must be diverse and well-chosen. They should come from different locations, industries and sectors. Twenty stocks from the same company will not give you the diversity that you are aiming for.

What About Mutual Funds?

Although mutual funds can be safe and profitable, they will not necessarily give you optimal diversification. Although the fund may invest in many different companies, many funds are still sector specific. Although you may be diversified in a particular sector, you do not have diversification across the board when it comes to different industries. If you are looking for something more diverse across the board, look into owning a balanced fund. They own stocks across the entire market.

When owning a mutual fund, it also can be a dangerous way to fall into over-diversification. Many large mutual funds own hundreds of different stocks, and therefore, so do you. Be sure to research what your mutual fund owns and keep tabs on how diverse it is.

 

Diversification is vital, but only to a certain extent. Be smart and vigilant when deciding where to invest your money. Find the happy balance that you are looking for.

 

Two Ways to Automate Your Savings

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If you struggle saving money, or hate having to take the time and brainpower to save each week, automated savings apps have the potential to rock your world.

The apps are designed with the user in mind, making saving money so easy that you do not have to do a single thing. Saving is transformed from an impossible goal to a mindless everyday occurrence.

Digit

Digit is a savings app that links to your banking account to put aside money for you. Their slogan is “Save money, without thinking about it.”

Digit has become increasingly popular with younger generations and with individuals who struggle to save. Rather than having to decide whether you want to save or splurge at the end of the month, extra money is taken out in small increments throughout the month.

Digit is the perfect friend for heavy spenders; the app is able to track your spending habits and monitor your income. Then, they occasionally pull aside money (never large sums) that you will not need for your routine expenses. Typically, this removal happens once or twice a week. It is never so frequent that it will affect your budget. The money is then kept in the app in a savings account. The app is able to send out text updates so that you are aware each time saving occurs.

If you need quick access to the savings, a short text to digit can have the money back into your account within one business day. No harm done! They have a no overdraft guarantee, your money is insured, and there is no need to set up a new savings account when you sign up.

You’re probably wondering… “So how much is this going to cost me?”

Digit is completely free, and a great tool for getting a jump start on your savings. Although you don’t receive interest, Digit is now doing something called cash bonuses, which is basically the same thing.

Right now, Digit is only US based, and is not available with all banking institutions (although it is with many). If you do not have much money, you will not save as much, but it doesn’t hurt to give it a shot!

Acorns

Acorns is another automated savings app that works by rounding up all your transactions to the nearest dollar. It puts all the spare change into investments for you. They help you pick which portfolio you are putting your money into, and instead of hoarding your savings, you begin to invest.

Acorns is all automatic, virtually pain-free and easy, and has no transaction fees. It allows you to make money off of your money. Acorns is perfect for beginners who know little about investing; you do little, and they take care of the hard work!

However, Acorns charges a monthly fee: $1.00 per month for accounts under $5,000, and 0.25% per year for accounts over $5,000. Students and individuals under the age of 24 can have these fees waived.

As with any investment, there is always the chance of losing money, rather than making.

 

Give one of these two automated savings apps a try and reap the benefits. Saving money no longer has to be difficult and painful. Slow down your spending habits, better your finances and put away savings.

It is way too easy to spend money when it is just sitting around in our checking account. Take control of the situation and do not leave it there tempting you.

Do robo-advisors do better than humans?

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Robo-advisors  are completely automated systems online that help you to invest your money. Robots, if you will. They are becoming increasingly popular with the younger generations, specifically those with less investment experience. Younger individuals getting their feet wet in the investment industry are turning to robo-advisors for all their financial advice.

You tell the robo-advisors what is important to you, and they do all the tough calculations. (Don’t worry, they’re using solid logarithms and criteria.) Many give general investment advice, and others help you plan for your retirement and reach other specific financial goals.

Although at first I was very skeptical of roboadvisors, I have tried one, Betterment, and found it to be extremely beneficial for me- a girl who initially had very little financial knowledge. They have minimal fees, and give you the flexibility that many investors need. You don’t have to be investment-savvy, and are still able to profit greatly from your investments. It is fairly safe and fool-proof.

However, due to the automation of them, roboadvisors are less unique and personalized. Every single individual is unique, with specific goals and situational differences. It is hard to explain all of that to a computer. Life is complicated; not everything is cut and dry… So, are roboadvisors better than humans who give investment advice?

That answer depends majorly on your individual situation. If the automation’s cookie-cutter approach is not ideal for you, a human interaction may be more beneficial. Humans are able to give you one on one advice, and sit down and listen to your concerns.

However, robo-advisors arguably can save you significant sums of money. Let’s discuss some specific situations, and which advisement technique would be best to use.

When to Use a Robo-Advisor:

  • When you don’t need direct contact and one-on-one interaction. If you’re comfortable with the computer screen, this is a perfect fit for you.
  • When you want to save money. Fees are generally much lower with roboadvisors than with human advisors.
  • When traditional investment advisors have high requirements. If you cannot find a human advisor who does not require steep minimum requirements, try a robo-advisor.
  • When you want to be less in control, and have someone else take care of things for you. If you are looking for a hands-off approach, here it is.

When to Use a Traditional Advisor:

  • If you prefer face-to-face interactions and one on one contact, robo-advisors are not the way to go.
  • If you prefer to not do everything online, including money transactions, then you need to sit down with a traditional advisor. For older generations who are not familiar with technology, robo-advisors may be much more difficult to operate.
  • When you disagree with your robo-advisor, or find that it is not fully benefiting your unique financial situation, switch to a traditional advisor.
  • Lastly, use a human advisor when you want to be more hands-on with your investments. You can be the one in control.

Decide which option is the best fit for you. If you cannot decide, give robo-advisors a chance. You can always go back to the traditional route. Regardless, keep investing. Your future will be brighter.

Blue Apron Company Profile and Review

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Blue Apron is a meal delivery service that delivers fresh ingredients for three or your ordered number of meals to your door. Their motto is “Food is better when you start from scratch.” I think we would all agree!

Food quality makes a huge difference in the meals we eat. While preparing food from scratch can sound appealing, it can be time consuming. Especially in households with two working members, it can seem almost impossible. Blue Apron fills a market need. For slightly more than regular groceries, as low as $8.57 per serving according to their website, they provide a premium meal experience at a less-than-premium price.

Blue Apron was founded in 2012. Since its founding, the company has raised roughly 194 million dollars, with its most recent rounding being a $135 million Series D raised in June 2015. Some estimates say the company has between 500 and 1000 employees with its 3 founders still holding C-level executive positions. They have been featured in The Wall Street Journal, Good Morning America, Tech Crunch, and The Washington Post, as well as many others.

blue apron company profile and review

Blue Apron allows you to see what the price-per-serving cost of a meal is. This allows you to compare the price for Blue Apron to your groceries. Thing is, though, that Blue Apron can’t be compared to your groceries. You see, groceries are just food, but Blue Apron is a service!

You’re not only getting all the ingredients you need to make dinner, but you’re also getting the lack of a hassle- less groceries to worry about and less mind space to let dinner take up. Blue Apron, though, is not like going out to eat. You still have to do the cooking and the cleaning yourself.

The cost of Blue Apron reflects its middle ground between between going out to eat and just making a “regular” meal at home. The price, at $8.74 to $9.99 per meal, reflects that middle ground. It’s cheaper than $16/meal at some restaurants but nicer than the $4/meal you’re probably managing with your groceries when you make some dinner.

I got the chance to try Blue Apron myself! One of the three meals we tried was a Chipotle-Glazed Meatloaf with Crispy Potatoes. My significant other, Casey and I decided to make a Saturday date-night experience out of it. We were hoping it would fill that middle ground – a nice date night but one that didn’t require spending what going out to dinner. Casey enjoys cooking, but I’m not great at it. As a result, I don’t particularly enjoy it. Our Blue Apron date night let us spend time together in a great way, doing something Casey loved, and that supported our financial goals.

The following Sunday, Casey had to work the whole day. I prepared for us our second meal – Oaxaca Cheese and Plantain Tortas with Tangelo & Radish Salad. I was shocked by the prep time for this meal – nearly an hour – but it had less than 10 minutes of cook time. As a result, I was able to bring Casey a delicious meal and we got to share a not-so-picnic-lunch sitting in Casey’s office.

Blue Apron is a company growing in popularity, which is why you may have already heard of it. The company is set up for success and it has found product-market fix. You can see how it meets a need in real people’s lives. It meets a need in my life. That really says something.

You can try Blue Apron yourself and get $30 off your first order with this link.

Tell me more: Have you ever tried Blue Apron or another meal delivery service? 

I obtained free meals in exchange for reviewing Blue Apron. All thoughts and opinions are my own.

More Blue Apron reviews:

Paribus Review: Is it Free Money?

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Paribus Review

There are a plethora of “free money” apps out there that feel like a scam. If you’ve gone looking for a Paribus Review, you know that isn’t the case with them. Paribus differentiates itself from so many of the other apps for one simple reason.

Yes! The differentiator here is that I have actually gotten money back through Paribus. I know, for a fact, that this app works. Now that that’s out of the way, we can dig into the app.

An Honest Paribus Review

You set up Paribus by giving it permission to connect to your email address. This is how it tracks your purchases made around the web! As previously mentioned, they work with select merchants, but those merchants cover a wide variety of products. I do 99% of all my online shopping at Amazon, but if you’re not like me, you’re likely still covered. You can also connect your Paribus account to your credit cards to cover your bases entirely and make sure you are always getting the best price.

How It Works

You sit back and relax. Paribus looks at your purchases and uses bots to check prices on the things you’ve bought to see if the price drops. If it does, they work to get you money back. If not… well, you bought it anyway! If Paribus finds you money back, you will receive a message. Paribus does not collect any commission from your refund. Signing up with this link will get you started.

Here’s an example:

Sally buys shoes from an online retailer for $48. Paribus watches the price and it drops to $24. The difference: $24. Instead of $48 on those shoes, your net expenses are $24. As an added bonus, you get all this money back without have to do any extra work since Paribus does that for you!

More About Paribus

Paribus is not a scam. Like I said, I have made money with them. But, I also did some background research for this Paribus Review. Here is what I found…

The app was initially developed in 2014 as the brainchild of two Harvard guys – Karim Atiyeh and Eric Glyman. The software pretty much only runs on iOS, but there are plans to expand it to other operating systems. It is also owned by Capital One, so Paribus is a legit app run by a major banking corporation.

My Take? – Found Money

One thing that differentiates Paribus from similarly “found money” apps is that it requires no work from you. No tedious surveys that pay 10 cents per word. This is an app that actually works, costs you nothing and can help you bring in extra money at no additional work or cost to you. You have nothing to lose!

This post was sponsored by Paribus. 

Where to get good free financial advice?

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If you are looking for financial advice, you probably don’t have money just lying around to be spent.  There’s a lot you can do before you shell out for a financial advisor! So, how can you get that advice for free? Here are five different websites with excellent financial advice available at no cost.

Rockstar Finance

Subscribe to Rockstar Finance to get your feet wet in a little of everything financial. Rockstar Finance has a great blog, a list of money saving challenges to consider, book reviews on great financial reads, and a whole slew of reviews and information on financial apps and services. Whatever you are looking for, they probably have right on their website free of cost.

How Do I Money

Check out this awesome finance website for great blogs, podcasts, books and more. One thing that makes them unique is their video series on Budgeting; definitely worth giving a watch. How Do I Money also offers four money spreadsheets on their site that help with budgeting, dealing with debt, saving money and more. These sheets are a great tool for those trying to get a better handle on their finances. Print them off and use them each month as you budget.

Making Sense of Cents

If you want to make sense of money, this is the blog for you! Michelle has a consistent blog that covers a wide variety of topics: saving money, making extra income, paying off debt, and tips for traveling. She loves to travel, and gives expansive advice on how to do that while sticking to your budget. If you have struggled in the past with your personal finances, this blog has plenty of tips explaining what you could be doing wrong and how to turn things around. Check out 15 Reasons You’re Broke and Can’t Save Money for a personal favorite of mine.

Stefanie O’Connell

Stefanie is an expert on helping millennials become personal finance professionals. Her blog and videos are interesting and informative, covering topics such as “Three Mental Roadblocks to Making More Money” and “3 Ways to Earn a Pay Raise.” If you’re a millennial looking to achieve financial greatness and to be money savvy, she’s the gal for you!

Burke Does

I may be slightly biased, but Emilie Burke has some great financial advice. (Yep, that’s me.) My website offers tons of free advice that will help you get your budget on track and find better ways to save money. Burke Does is a lifestyle blog that specializes in personal finances and millennial struggles. I write about the balance between overcoming debt, staying healthy and enjoying life along the way. Check out my latest blog, Knowing Your Why When Paying Down Debt, to discover the importance of knowing your motivation while freeing your life from the weight of debt.

Bonus Tip

Pinterest has tons of resources for financial advice. A little searching can lead you to endless financial tips and tricks to help you save money and budget well.

Mutual Funds: The Pros and the Cons

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First thing first: What is a Mutual Fund?

A mutual fund is a strategy for investing that allows you to pool your money together with others to purchase a collection of stocks, bonds, or other securities. Typically, the fund is purchasing something that might be difficult or impossible for you to purchase on your own.

The collection of holdings that the fund, or company, purchases is called its portfolio. As an investor, you own a share of the fund. However, you do not own any of the portfolio. This is different; the individual stocks do not belong to you.

Now… let’s talk about some pros and cons of mutual funds.

Pros:

  1. Mutual funds are convenient: You are doing a lot less of the research and work. Others do the “thinking,” and you are there to make money.
  2. Mutual funds are diverse: By coming together with other investors, you are able to hold an assortment of holdings that you would be unable to purchase on your own. You are no longer limited by your own finances, and your personal opportunities soar.
  1. The funds are professionally managed: Typically, there are a couple of professional managers and also a team of researchers leading the fund. People much more qualified and experienced are calling the shots.
  1. They are fool-proof: By joining a mutual fund, you have the opportunity to invest any amount of money with very little experience or investing history. You don’t have to continually decide which stocks will be a good investment. After joining, you are able to sit back and relax.

Cons:

  1. Mutual funds charge fees: Mutual funds are expensive to run, and therefore investors are often hit with high fees. There are often annual rates and sales commissions included in the funds.
  1. Share prices are only calculated once a day: Unlike single stocks, you cannot check price changes of a mutual fund throughout the day. The price completely depends on the fund’s net asset value (NAV), which is determined by all the different holdings within the fund. This is only calculated once each day.
  1. Shareholders are distributed Capital Gains: By law, mutual funds must distribute capital gains to investors. No matter how long you have been a part of the fund, the distributions are still taxed at the long-term rate. With single stocks, taxes on capital gains do not have to be paid until after you sell the stock and thus make profit. In mutual funds, you also have to pay taxes every single year on the fund’s capital gains.
  1. Phantom Gains: Bummer alert- this is a pretty big con. In a mutual fund, you can actually lose money on an investment, but still owe taxes. Talk about back-tracking… This is common when mutual funds are doing poorly, and investors decide to sell. The fund may in return have to sell profitable investments in order to raise money to pay off the investors leaving. This creates capital gains, which are then distributed to all the investors.