That said, college students should also focus on their financial future, including steps they can take to build credit before they enter the workforce.

After all, having a credit history and a good credit score can mean being able to rent an apartment, finance a car or take out a loan, whereas having no credit at all can mean sitting on the sidelines until the situation changes.

Fortunately, there are all kinds of ways for young adults to build credit while they’re still in school. Some strategies require a little work on their part, but many are hands-off tasks that you only have to do once.

Teach Them Credit-Building Basics

Make sure your student knows the basic cornerstones of credit building, including the factors that are used to determine credit scores. While factors like new credit, length of credit history and credit mix will play a role in their credit later on, the two most important issues for credit newcomers to focus on include payment history and credit utilization.

Generally speaking, college students and everyone else can score well in these categories by making all bill payments on time and keeping debt levels low. How low?

Most experts recommend keeping credit utilization below 30% at a maximum and below 10% for the best possible results. This means trying to owe less than $300 for every $1,000 in available credit limits at a maximum, but preferably less than $100 for every $1,000 in credit limits.

Add Your Child as an Authorized User

One step you can personally take to help a child build credit is adding them to your credit card account as an authorized user. This means they will get a credit card in their name and access to your spending limit, but you are legally responsible for any charges they make. Obviously, this move works best when you have excellent credit and a strong history of on-time payments and you plan to continue using credit responsibly .

While this step can be risky if you’re worried your college student will use their card to overspend, you don’t actually have to give them their physical authorized user credit card.

In fact, they can get credit for your on-time payments whether they have access to a card or not. If you do decide to give them their credit card, you can do so with the agreement they can only use it for emergency expenses.

Encourage Them to Get a Secured Credit Card

Your child can build credit faster if they apply for a credit card and get approved for one on their own, yet this can be difficult for students who have no credit history. That said, secured credit cards require a refundable cash deposit as collateral are very easy to get approved for.

Some secured credit cards like the Ambition Card by College Ave even offer cash back¹ on every purchase and don’t charge interest². If your child opts to start building credit with a secured credit card, make sure they understand the best ways to build credit quickly — keeping credit utilization low and paying bills early or on time each month.

Opt for a Student Credit Card Instead

While secured credit cards are a good option for students with little to no credit get started on their journey to good credit, there are also credit cards specifically designed for college students. Student credit cards are unsecured cards, meaning they don’t require an upfront cash deposit as collateral, but charge interest on any purchases not paid in full each month.

Many student credit cards offer rewards for spending with no annual fee required as well, although these cards do tend to come with a high APR. The key to getting the most out of a student credit card is having your dependent use it only for purchases they can afford and paying off the balance in its entirety each billing cycle. After all, sky high interest rates don’t really matter when you never carry a balance from one month to the next.

Help Your Child Get Credit for Other Bill Payments

While secured cards and student credit cards help young adults build credit with each bill payment they make, other payments they’re making can also help.

In fact, using an app like Experian Boost can help them get credit for utility bills they’re paying, subscriptions they pay for and even rent payments they’re making. This app is also free to use, and you only have to set up most bill payments in the app once to have them reported to the credit bureaus.

There are also rent-specific apps and tools students can use to get credit for rent payments, although they come with fees. Examples include websites like Rental Kharma and RentReporters.

Make Interest-Only Payments On Student Loans

The Fair Isaac Corporation (FICO) also notes that students can start building credit with their student loans during school, even if they’re not officially required to make payments until six months after graduation with federal student loans.

Their advice is to make interest-only payments on federal student loans along with payments on any private student loans they have during college in order to start having those payments reported to the credit bureaus as soon as possible.

“Making interest-only payments as a student will not only positively affect your credit history but will also keep the interest from capitalizing and adding to your student loan balance,” the agency writes.

Of course, interest capitalization on loans would only be an issue with private student loans and  Federal Direct Unsubsidized Loans since the U.S. Department of Education pays the interest on Direct Subsidized Loans while you’re in school at least half-time, for six months after you graduate and during periods of deferment.

The Bottom Line

College students don’t have to wait until they’re done with school to start building credit for the future, and it makes sense to start building positive credit habits early on regardless. Tools like a credit card can help students on their way, whether they opt for a secured credit card or a student card. Other steps like using credit-building apps can also help, and with little effort on the student’s part or on yours.

Either way, the best time to start building credit was a few years ago, and the second best time is now. You can give your student a leg up on the future by helping them build credit so it’s there when they need it.

¹Cash back rewards are subject to the Ambition Rewards Terms & Conditions.

²0% APR. Account is subject to a monthly account fee of $2, account fee is waived for the initial six-monthly billing cycles.

College Ave is not a bank. Banking services provided by, and the College Ave Mastercard Charge Card is issued by Evolve Bank & Trust, Member FDIC pursuant to a license from Mastercard International Incorporated. Mastercard and the Mastercard Brand Mark are registered trademarks of Mastercard International Incorporated.

The post 6 Ways to Help Your Child Build Credit During College appeared first on Good Financial Cents®.

It seemed illogical to pay $30 a month for software that just offered a basic sales page, especially without any integrated email service provider.

This was a stark contrast to my experience with platforms like ConvertKit, where I started with a free account until my subscriber count grew large enough where I had to pay.

As I spent more time with Stan Store, my perspective began to shift. I realized that for someone completely new to online marketing, who might be overwhelmed by the complexities of building and creating a landing or sales page, Stan Store could actually make a lot of sense.

It’s tailored for beginners, offering them a straightforward entry point into the world of digital marketing.

Who is Stan Store For?

So, who’s going to love Stan Store? Pretty much anyone aiming to make a buck online through digital products or services. If you’re like me, trying to turn those ‘link in bio’ clicks into actual sales, then Stan Store is your go-to.

Let me break it down for you. Stan Store is a hit with a wide range of creators and businesses, but from my experience, it’s a total game-changer for:

• Content Creators, Influencers, Micro-influencers, and UGC Creators
• Instagrammers, TikTokers, YouTubers, X’rs
• Online Coaches, Mentors, and Teachers
• Digital Product Creators (Etsy, you’ve got competition)
• Social Media Managers and Content Managers
• Designers, Freelancers, and Small Digital Businesses

And hey, even if you’re in the business of selling physical goods, Stan Store can be a killer tool for growing your email list or hosting online events.

Just a heads up though – selling physical products directly through Stan Store isn’t on the table just yet.

How Does Stan Store Work?

Picture this: I’m on TikTok or Instagram Stories, chatting about my latest digital product – let’s say it’s an eBook or a PDF.

In the past, I’d direct my followers to the ‘link in my bio’, which would then send them off to another site, like my website. There, they’d have to play detective to find the product I was talking about, or sit through endless page loads.

But with Stan Store, things get a whole lot smoother. The ‘link in my bio’ is now the store itself. Followers can hit that link, buy what they want right there and then, without being shunted off to a different site.

The best part? They can hop right back to Instagram or TikTok without feeling like they ever left. It’s all about keeping it simple and seamless – and that’s what Stan Store nails perfectly.

Here’s a screenshot of my wife’s personal Stan Store:

We’re still not a big fan of their email signup process so for now our opt-in page (squeeze page) is hosted on Kajabi.

But my wife is selling our Digital Product Quickstart Guide on Stan Store. Here’s how the sales page looks:

Behind the scenes of our sales page is a payment processor and the ability to deliver the digital product with ease. That’s what makes Stan Store so attractive. You can literally start selling your very own digital product in a matter of minutes.

Stan Store Features Overview

Stan Store is packed with features designed to make the life of a digital creator easier and more profitable. Whether you’re a coach, influencer, or digital product creator, here’s what Stan Store brings to the table:

• Mobile & Desktop Optimized Store: Your store looks great and works seamlessly on any device, ensuring a smooth shopping experience for your audience.
• Calendar Invites & Bookings Product: Easily manage appointments and bookings directly through your store.
• Analytics: Get insights into your store’s performance to make data-driven decisions.
• Unlimited Course Products: Offer as many courses as you like, with no restrictions.
• 1-Tap Checkout: A streamlined checkout process that makes purchasing a breeze for your customers.
• Recurring Subscription Products: Ideal for memberships and ongoing services, this feature allows for regular income.
• Audience/Newsletter Builder: Grow your audience and keep them engaged with integrated newsletter tools.

Stan Store Plans: Creator vs. Creator Pro

Creator Plan

The Creator plan, priced at $29 per month (or $300 per year with a 20% discount), is an excellent starting point for anyone looking to jumpstart their online business. It includes all the essential tools you need:

• Mobile & Desktop Optimized Store
• Calendar Invites & Bookings Product
• Analytics
• Unlimited Course Products
• 1-Tap Checkout
• Recurring Subscription Products
• Audience/Newsletter Builder

This plan is perfect for creators who are just beginning to monetize their online presence and need a comprehensive, yet straightforward set of tools to get started.

Creator Pro Plan

For those ready to take their business to the next level, the Creator Pro plan is available at $99 per month (or $948 per year with a 20% discount). It includes everything in the Creator plan, plus advanced features for optimizing conversions and offering more to your customers:

• Advanced Pricing & Payment Plans
• Discount Codes
• Limit Quantity
• Payment Plans
• Order Bumps & Upsells
• Funnel Builder
• Affiliate Share Feature
• Email Marketing

The Creator Pro plan is tailored for creators who are looking to expand their offerings, optimize their sales process, and engage more deeply with their audience.

Benefits of Using Stan Store

Convenience and Accessibility

The convenience and accessibility of Stan Store are what eventually changed my initial skepticism. The platform allows anyone, regardless of their technical skill, to quickly set up a landing or sales page.

This ease of use is a crucial factor for many users, especially those who lack the time or technical expertise to navigate more complex systems.

Competitive Pricing and Deals

The initial pricing, though seemingly high, is justified by the platform’s simplicity and effectiveness, particularly for its target audience – the absolute beginner in online marketing. The recent addition of an email service provider at a higher tier adds more value, making it a more comprehensive tool.

Drawbacks of Stan Store

Limitations in Product Availability

One of the criticisms I had of Stan Store was its limited range of features. While its simplicity is its strength, it also means that users looking for more advanced features might find Stan Store lacking. This limitation can be a significant drawback for users as their businesses and marketing skills evolve.

Stan Store Alternatives

In the journey of online entrepreneurship, it’s crucial to explore various platforms to see what aligns best with your business needs. While Stan Store has been a solid choice for me, I’ve also had experiences with other platforms worth mentioning:

• Shopify: Shopify is a robust platform for creating online stores. It’s feature-rich and offers a lot of flexibility for those looking to build a detailed and extensive online shop.
• WooCommerce: Ideal for WordPress users, WooCommerce seamlessly integrates with your existing site, transforming it into a fully functional e-commerce platform. It’s versatile but can be a bit complex, especially for beginners.
• Etsy: Etsy is the go-to marketplace for unique, handmade, or vintage items. It’s less about building your own store and more about joining a vibrant, existing marketplace.
• Teachable and Thinkific: Both are excellent for creating and selling online courses. They offer a range of tools tailored for educators and coaches, focusing on course creation and student engagement.
• Gumroad: Simple and straightforward, Gumroad is perfect for independent creators selling digital products like books, music, or art directly to their audience.
• Kajabi: Kajabi is an all-in-one platform offering tools for online courses, marketing, and website building. It’s ideal for those offering educational content and looking for a comprehensive solution.

Comparison Table: Stan Store vs. Alternatives

This table gives a quick overview of how Stan Store compares with its alternatives in terms of customization, ease of use, target audience, product type, and pricing model. Each platform has its strengths, and the best choice depends on your specific business needs and goals.

Is Stan Store Worth it?

After diving deep into Stan Store and comparing it with its alternatives, the big question remains: Is Stan Store worth it? Based on my experience and the insights I’ve gathered, my answer leans towards a yes, especially for a specific audience.

Stan Store stands out for its sheer simplicity and focus on digital content creators. If you’re just starting out or find yourself overwhelmed by the complexities of more advanced platforms, Stan Store offers a welcoming and straightforward path. The ease of setting up a sales or landing page, combined with the platform’s focus on digital products, makes it an attractive option for creators who want to monetize their content without the hassle.

The pricing, initially a point of skepticism for me, actually makes sense when you consider the target audience and the features offered. For beginners and those not ready to navigate the complexities of platforms like Shopify or WooCommerce, Stan Store’s $29 monthly fee for the Creator plan is a reasonable investment.

And for those looking to scale up, the Creator Pro plan, despite its higher price, brings in advanced features that could justify the cost as your business grows. If you’re not sure Stan Store is a good fit, the 14-day free trial might be exactly what you need.

Bottom Line – Stan Store Honest Review

In conclusion, while Stan Store might not be the one-size-fits-all solution for every online entrepreneur, it certainly has carved out its niche. It’s a platform that understands and caters to the needs of digital content creators, making it a worthwhile consideration for those in its target demographic.

As with any tool, it’s about finding the right fit for your specific needs, and for many creators, Stan Store could be just that.

To try Stan Store for free, click here for a 14-day trial.

The post What is Stan Store? appeared first on Good Financial Cents®.

Let’s face it, when you hear something like that, your first thought is, “This has got to be too good to be true.”

That was my initial reaction too. A free, do-it-all software that doesn’t suck? Highly doubtful.

But here’s the shocker: Systeme.io isn’t just blowing smoke. It’s a game-changer. As someone who’s navigated the maze of digital marketing tools, I was prepared for disappointment. Yet, Systeme.io left me floored with its capabilities.

Take it from someone who’s been around the block with the likes of ConvertKit, AWeber, and MailChimp. These giants lure you in with free offerings, only to tighten the screws when your audience grows. Then there’s WordPress.org – great for setting up a blog, but it’s like climbing Everest if you’re a newbie.

Systeme.io, on the other hand, is a beast of a different nature. Offering highly effective landing pages and robust sales funnels with professional templates for free? That’s unheard of. It’s like stumbling upon a treasure chest in your backyard.

My first foray into landing page software was with ClickFunnels, an undeniably powerful tool. But once the 14-day trial evaporates, you’re staring down the barrel of a $100 monthly fee. Worth it if you’re a pro, but a gut punch for beginners.

That’s where Systeme.io plays its masterstroke. It lets you dip your toes with up to 2,000 contacts or email subscribers and three sales funnels before asking for a dime.

Yes, you can test it out 100% completely FREE.

And when the time comes to open your wallet, it’s less than $30 a month – an absolute steal for the arsenal of tools you’re getting.

The platform serves a multifaceted purpose, aiming to simplify the digital marketing process. It’s designed for entrepreneurs and businesses seeking an integrated solution for email marketing, sales funnels, website building, and more.

The importance of such a tool lies in its ability to streamline various marketing tasks, which are often scattered across different platforms, into one cohesive system.

OUR PICK

Yes! sign me up

All Tools

Access

FREE

New User

Try Systeme.io For Free

How Systeme.io Works

The user interface of Systeme.io? It’s okay, but let’s not sugarcoat it. For a newbie who’s never dabbled in sales funnels or email campaigns, it can feel like being thrown into the deep end. It’s not the sleek, intuitive experience that tech gurus might rave about. But, and this is a big but, Systeme.io doesn’t just leave you hanging.

The saving grace here is their tutorials. These are goldmines for beginners. They walk you through the process, breaking down what could be an overwhelming experience into manageable chunks. So, while the interface might not win any beauty contests, the support system in place is BIG help.

Features of Systeme.io

At the core of Systeme.io are several key features that make it a comprehensive digital marketing solution. These include email marketing capabilities, sales funnel creation tools, a website builder, options for hosting membership sites, and affiliate program management.

Each of these features is designed to work seamlessly with the others, providing a unified experience. For instance, the email marketing service is notably efficient, rivaling established providers like ConvertKit, AWeber, and MailChimp, especially with its free subscription model that remains functional up to a certain point.

Here’s a sample template they offer for their email campaigns:

Here’s a breakdown of all the features Systeme.io offers:

• Email Marketing: Here’s where Systeme.io flexes its muscles. You can segment your audience, whip up personalized campaigns, and dive into analytics. It’s not just sending emails; it’s about sending smart emails. But don’t expect to master it overnight. There’s a learning curve, but it’s worth the climb.
• Sales Funnel Builder: This is where Systeme.io starts to shine. It’s not just about slapping together a few pages; it’s about crafting a customer journey. The drag-and-drop interface is decent, but it’s the strategic aspect that’s the real winner. Newbies might feel a bit lost at sea initially, but once you get the hang of it, it’s smooth sailing.
• Blogging and SEO: Systeme.io’s blogging platform is straightforward. It’s not the Rolls Royce of blogging, but it gets you from A to B. You’ve got your SEO-friendly tools, customizable URLs, and Google Analytics integration. It’s no WordPress, but it’s not trying to be.
• Automation and Workflow: Here’s where Systeme.io tries to simplify the complex. The automation rules are a time-saver, although they’re not the most advanced on the market. It’s like having a Swiss Army knife when sometimes you might need a specialized tool.
• Affiliate Program Management: Running your own affiliate program within Systeme.io is a neat feature. It’s a solid, if not spectacular, way to expand your reach without breaking the bank.

And if here’s a fancy table to help simplify it even more:

Benefits of Systeme.io

Cost-Effectiveness: Breaking It Down

When we talk about the cost-effectiveness of Systeme.io, we’re looking at a platform that offers a substantial suite of features without the hefty price tag that usually accompanies such versatility.

For starters, Systeme.io’s freemium model is a standout in the digital marketing space (click here to open a free account today). You can manage up to 2,000 contacts and create three sales funnels without spending a penny. This is a significant advantage for entrepreneurs and small businesses where every dollar counts.

To put this into perspective, let’s compare it with some industry counterparts. Platforms like ClickFunnels and Kartra, while offering robust functionalities, start their pricing at around $97 to $99 per month after their trial periods. This can be a steep investment for those just starting out.

In contrast, Systeme.io not only allows you to test the waters for free but also keeps the costs low even when you upgrade. Their paid plans, offering a broader range of features, start at less than $30 a month.

This pricing strategy makes advanced digital marketing tools accessible to a wider audience, breaking down the financial barriers that often hinder small businesses and startups.

All-in-One Platform: A Closer Look

The all-in-one nature of Systeme.io is its hallmark. It consolidates various marketing tools into one cohesive platform. This integration means you can manage email campaigns, build sales funnels, create websites, and even run affiliate programs without having to switch between different software. For many users, this integration simplifies the digital marketing process significantly, allowing for a more streamlined workflow.

However, it’s important to recognize that while Systeme.io covers a broad spectrum of functionalities, it may not offer the same depth as specialized standalone tools in each specific area.

For instance, while its email marketing capabilities are robust, they might not have the advanced features of a dedicated email marketing service.

Similarly, its website builder is competent for basic to intermediate needs, but it might not satisfy users looking for highly advanced web design features.

Ease of Use: A Realistic Perspective

Systeme.io aims to be user-friendly, and for the most part, it achieves this goal. The interface is designed to be intuitive, especially for those who have basic familiarity with digital marketing tools. However, for complete beginners, there can be a learning curve.

The platform offers a range of tutorials and support materials, which are invaluable for new users. I’ve watched (and rewatched) several of these tutorials to lean how to use their software.

These resources are designed to help users navigate through the initial complexity and make the most out of the platform’s features.

Drawbacks of Systeme.io: The Straight Talk

Customization: Not Quite There Yet

Let’s get real about customization in Systeme.io. It’s got a decent selection of templates and the interface won’t make you pull your hair out, but if you’re looking to really dive deep into customization, you might hit a wall.

For those who have grand visions of a highly unique and tailored digital presence, Systeme.io can feel a bit like playing with kid gloves. It’s great for getting you up and running, but for the more ambitious or specific design needs, it’s not quite the creative playground you might be looking for.

Growing Pains: Scaling Up Challenges

Now, onto scalability. Systeme.io is like that compact car that’s perfect for city driving but struggles a bit on the open highway. For small businesses or solo entrepreneurs just starting out, it’s a match made in heaven. But as your business grows and your needs become more complex, Systeme.io might start to feel a bit cramped.

This is especially true for larger businesses or those niche ventures that need more than just the basics. As you scale up, you might find yourself needing more sophisticated tools and features that Systeme.io doesn’t offer.

Plus, when it comes to playing nice with other tools or services you might be using, Systeme.io isn’t always the most cooperative. It works well within its own confines but doesn’t always reach out to others easily.

Systeme.io Pricing Structure

The pricing structure of Systeme.io is one of its most appealing aspects. The platform operates on a freemium model, offering significant functionality without any cost for up to 2,000 contacts or email subscribers and three sales funnels. This approach allows users to thoroughly test and experience the platform before committing financially.

When compared to competitors, Systeme.io’s pricing is highly competitive. For instance, platforms like ClickFunnels offer powerful functionality but at a higher cost, typically starting at around $100 per month after a free trial. This can be a significant investment, especially for new entrepreneurs or small businesses.

In contrast, Systeme.io’s paid plans, which provide access to a broader range of features, are more affordable, starting at less than $30 a month.

How Does Systeme.io Compare to Other Tools?

Comparative Analysis with Other Tools

To provide a broader perspective, let’s compare Systeme.io with other popular tools in the market:

This comparison shows that while Systeme.io offers a comprehensive suite of tools at an affordable price, platforms like HubSpot and Kartra provide more advanced features in certain areas but at a higher cost. ClickFunnels, on the other hand, is more expensive but offers highly customizable funnel-building capabilities.

Is Systeme.io Legit?

User reviews and testimonials play a crucial role in understanding the real-world effectiveness of Systeme.io. Many users have shared success stories, highlighting how the platform has helped them streamline their marketing efforts and grow their businesses.

Upon reviewing their Trustpilot account, you can see the experience with Systeme.io is remarkable. Currently, there are 3,635 reviews with an average rating of 4.9. That is outstanding!

However, it’s also important to consider critiques and common issues raised by users. Some have pointed out the limitations in customization and scalability, as mentioned earlier. These critiques are valuable for potential users to set realistic expectations and for the platform’s developers to identify areas for improvement.

Comparing Systeme.io to Others

I currently have accounts with Systeme.io, Click Funnels, and Kajabi. To show you how they compare here’s a look at 3 different landing pages I’ve created each of them.

Here is a landing page I created with Systeme.io:

In comparison, here’s an older landing page I create with Click Funnels…

And just because I love showing you variety, here’s a landing page created in Kajabi..

When you factor in both Click Funnels and Kajabi only offer free trials (around 14 days) and you have to start paying after that, the Systeme.io funnel becomes THAT more attractive. Here’s a look at some of the templates they offer for free:

Final Verdict on Systeme.io

In essence, while Systeme.io is a fantastic starting point for new online businesses, offering a solid foundation and easy-to-use tools, it’s not the endgame for everyone.

As your business evolves, you might outgrow its capabilities and start looking for something that offers a bit more room to stretch your entrepreneurial legs.

It’s a great launchpad, but for those on a path to rapid growth or with highly specific needs, keep in mind that you might need to eventually graduate to more advanced tools.

The post The Truth About Systeme.io: Game-Changer or Just Another Gimmick? appeared first on Good Financial Cents®.

Although CDs offer less liquidity than a regular checking account or savings account, you might get a higher rate of return with this financial product. This is especially true if you open a CD account with a longer timeline; for example, a 60-month CD instead of a 12-month CD.

According to the Federal Deposit Insurance Corporation (FDIC), national average CD rates range from 1.33% to 1.84% depending on the CD term, as of writing.

However, quite a few banks offer vastly superior CD rates to consumers who do their research. We compared dozens of banks and financial institutions to find the best CD rates today. If you’re on the hunt for a high-yield CD, start your search here.

Important Factors for Certificate of Deposit Accounts

• CDs are for long-term savings. Since CDs lock your funds into the account for a specific term (usually 12 to 60 months), they aren’t ideal for money you might need to access in the short term.

• CDs offer security for your funds. CD accounts are a secure place to stash your money and earn interest, thanks to FDIC insurance.

• Check for CD fees. Most CDs charge fees if you need to access your money early. Make sure you understand these fees before opening this deposit account.

• Online banks might offer better rates. Although brick-and-mortar banks offer their own CDs, you might find better rates through online banks. Compare legacy banks and online institutions to find the best CD rates.

If your goal is securing a superior short-term investment, the best CD rates are worth exploring. To help in your search, we compared many of the top financial institutions and online banks to find options with the most attractive rates and terms.

Find the Highest CD Rates from Banks and Credit Unions

Explore and contrast the top certificates of deposit (CDs) rates based on the highest Annual Percentage Yield (APY), spanning various terms including 3-month, 6-month, 1-year, 2-year, and 5-year options.

The banks below made our ranking due to the interest rates they offer and other features.

• PNC 
• CIT Bank
• Discover®
• Marcus by Goldman Sachs
• Synchrony Bank

Best Certificate of Deposit Accounts – Reviews

There are a few factors to consider when choosing where to open a certificate of deposit. These include whether you want to open your CD in person or online, the rates and terms that apply, and the fees required to access your money early.

The following reviews explain the CD rates for each of the top banks we profile and other details you should know.

PNC Bank

PNC Bank offers a variety of popular banking products, including certificates of deposit. Its CDs don’t require any monthly maintenance fees, and you can monitor your account at any time online or with the BBVA mobile banking app.

CD terms range from 7 days to up to 10 years, and CDs with longer timelines pay higher CD rates. Note that penalties apply if you access your money early.

If you cash out your CD early, with a term of one year or less, you’ll pay $25 plus 1% of the amount withdrawn. If you cash out a CD with a longer-term early, you’ll pay $25 plus 3% of the amount you cash out.

CD Rates: Online CDs with terms from 11 months to 36 months currently pay up to 5.04% APY.

CIT Bank

CIT Bank is known for its popular high-yield savings account, known as Savings Builder, but it also offers an array of CDs with excellent terms. Its 11-month, no-penalty CD stands out since it offers an excellent return rate. There are also no penalties if you need to access your money early.

CIT Bank also offers term CDs with various other lengths, as well as jumbo CDs for deposits of $100,000 or more. None of its CDs come with account opening fees or account maintenance fees.

CD Rates: CIT Bank currently pays from 0.30% to 3.50% APY on their CDs, depending on the term you choose. Top rates are offered on their 18 month CDs, which pay out 3.00% APY, respectively. Additionally, they have an excellent 11-month No-Penalty CD at 3.50% APY as of the time of this writing (04/05/23.)

Discover

With Discover, you can open a CD that lasts anywhere from three months to 120 months. There are no fees to open a CD, including account opening fees or maintenance fees, although their minimum opening deposit is $2,500.

Discover also stands out due to the reasonable penalties it charges if you need to access your money early. CDs with a term of less than one year, incur a penalty at three months of simple interest. For a CD that lasts one to four years, the penalty for cashing out early is just six months of simple interest.

CD Rates: The 120-month (10-year) CD is most rewarding, currently offering 3.75% APY, but that’s a long time to wait. If you’re willing to part ways with your funds for just 12 months, you can earn a rate of 4.70% APY.

Marcus by Goldman Sachs

Marcus by Goldman Sachs is a popular online bank for personal loans and high-yield savings accounts, yet it also offers rewarding CDs. Terms for its CDs range from seven months to six years, with a minimum $500 deposit to get started.

Marcus by Goldman Sachs even offers a 10-day guarantee that says you can move your rate up if the advertised rates on the CD you purchased increase within 10 days.

CD Rates: Some of the best CD rates from Marcus by Goldman Sachs are for its 9-month CDs, which currently pay 5.10% APY. Marcus by Goldman Sachs also offers limited-time CD rate promotions, like 5.25% on an 18-month CD.

What Holds It Back: Marcus by Goldman Sachs is an online bank only, so you don’t have the option to open your CD in person.

Synchrony Bank

We chose Synchrony Bank for our ranking because it doesn’t impose a minimum balance requirement, yet has competitive CD rates. It offers a 15-day guarantee, which lets you raise your rate if the advertised rate increases within 15 days of your CD purchase.

Terms are available from three months to 60 months. Early withdrawal fees for their CDs are also reasonable. For example, early cash-outs on CDs with terms of 12 months or less charge 90 days of simple interest at the current rate.

CD Rates: Five-year (60-month) CDs currently pay 4.00% APY, and three-year (36-month) CDs pay 4.30% APY. They also have a 16 month paying 5.40%

What Holds It Back: Synchrony Bank CDs are meant to be opened and maintained online, so you consider a different bank if you’re hoping for a personalized experience or you prefer to bank in person.

How We Found the Best CD Rates

Finding the best CD rates is important if you want to maximize returns on your savings, yet there are other factors to consider before opening an account. We considered the following factors when compiling this list of banks with the best CD rates of 2024:

Rates and Terms

Although we gave preference to banks that apply the best rates to various CD terms, we focused on banks that offer at least one CD with an APY that is at least double the average CD rate nationwide.

BBVA didn’t score well in this category, yet we included them due to their lack of account fees and a strong reputation among major U.S. financial institutions.

Account Fees

We only considered banks that don’t charge fees to open a CD account. We also chose banks that don’t charge any monthly account maintenance fees.

Early Withdrawal Penalties

Most banks charge an early withdrawal fee if you cash out your CD early, so we looked for banks with reasonable penalties. We also gave preference to accounts or CD options that don’t charge any penalty for early withdrawals.

FDIC Insurance

Finally, we only included institutions in our ranking that offer FDIC insurance. This insurance secures up to $250,000 of CD funds per account holder.

What You Need to Know About Certificates of Deposit

If you have never opened a certificate of deposit before, you might wonder how they work and why people choose this option. Here are some important factors when considering a CD account.

• CDs offer superior rates compared to other deposit products. According to recent figures from the FDIC, the average national CD rate for a 60-month term is about four times greater than the average national savings account rate.

• Longer CDs offer better yields. Committing your money to a longer timeline can lead to considerably higher returns. FDIC data shows that the average APR for a one-month CD is only .02% — not much better than a basic savings account.

• CD rates can go up or down over time. CD rates are determined based on the current interest rate environment, including benchmark interest rates. This means that you might get a better CD rate any time benchmark interest rates go up.

• CD rates can be higher on larger amounts. If you have $100,000 or more to deposit, you might qualify for a “jumbo CD”. This type of CD requires a high minimum deposit, but banks are willing to pay higher APYs to lock in more funds.

Summary: Best CD Account Rates of March 2024

The Bottom Line – Locking in the Highest CD Rates

Investing in a certificate of deposit (CD) is one of the safest ways to grow your money. CDs are low-risk investments with guaranteed returns, so they can be an excellent choice for those looking to diversify their portfolios and lock in higher interest rates.

When choosing a CD, it’s important to compare APYs (annual percentage yields) and terms between different banks and credit unions in order to get the best rate possible. Shop around for promotional offers or talk to financial advisors if you need help selecting the right CD for your needs.

With careful research and comparison, you’ll be able to find the CD that gives you the highest rate – and peace of mind – in the long run.

The post Best Bank CD Rates for 2024 appeared first on Good Financial Cents®.

If you’re like many who took out loans during college, you will likely be paying them off after you graduate. In fact, 82% of students who borrowed loans expect to be making payments post-graduation, according to a recent College Ave Student Loans survey.  

That said, you’ll want to make sure you’re balancing debt repayment with your savings goals along the way. 

You’ll also want to make sure you’re paying down debts in the optimal order, or in a way that will help you save the most money on interest as possible while aligning with your goals. Which debts should you pay off first? Here’s a rundown of how to get the best results:

1. Pay Off High-Interest Debts 

No matter which types of debt you have, credit card debt should be your first priority. Why? Because credit card debt is likely the most expensive debt you have by far.

Federal Reserve data shows the average credit card interest rate on accounts assessed interest came in at around 22% as of May 2023, yet your credit card could easily be charging higher rates than the average. 

To save as much money as possible, you should strive to pay as much as you can toward high-interest credit card bills each month. You can also pay down credit card debt faster with the help of a debt consolidation loan or a 0% APR balance transfer credit card.

2. Other Unsecured Debts

Other unsecured debts like personal loan debt should come next in the debt payoff pecking order. After all, unsecured debts tend to have higher interest rates than secured debts like auto loans. In fact, the Federal Reserve also reported that the average interest rate on a 24-month personal loan came in at 11.48% as of May 2023, compared to the average rate of 7.81% on a 60-month auto loan.

Ideally, you’ll start paying more toward personal loan debt and other unsecured debts after all credit card debt is entirely paid off, although you should make at least the minimum payment on all your bills throughout the entire process.

3. Next Up, Student Loans

The next debt you’ll want to tackle is your student loans. I suggest focusing on these loans after other unsecured debts, since federal student loans (and many private student loans) come with low fixed interest rates and monthly payments that will not change over time. If you have federal student loans, you may even want to look into income-driven repayment plans. 

If you’re hoping to pay down student loans faster or just want to save money on interest, you can also consider refinancing your student loans to get a shorter repayment timeline, a lower monthly payment, or both. Just remember that refinancing federal student loans can mean losing access to income-driven repayment plans and federal protections like deferment and forbearance.

4. Remaining Debt

Once you have paid off or substantially paid down all your other debts, you can focus your efforts on secured debts you have like mortgage loans and auto loans. These debts should be dealt with last since they are secured with collateral and tend to offer lower interest rates as a result. For example, you can consider paying more than the minimum on your mortgage, a car loan, or both until they’re paid off completely. 

Then again, you may want to pay off debts with extremely low interest rates as slowly as possible to free up more cash flow for living expenses and investments. If you took out a mortgage in January of 2021 when the average interest rate on a 30-year, fixed rate home loan was as low as 2.65%, for example, it makes sense to make the minimum payment on that debt and invest your extra cash instead.

Other Financial Considerations

It’s important to make sure you balance debt repayment with other financial considerations. After all, focusing too much on debt repayment early in life can leave you behind when it comes to investing for retirement or saving up for a first home.

While you’ll want to eliminate credit card debt and other high-interest debts as quickly as you can, even if you have to stop saving and investing for a while, you can pay down student loan debt and secured debts at a slower pace while saving and investing for the future along the way.

Finally, make sure you have adequate emergency savings throughout your entire debt payoff journey, or that you begin saving for emergencies as soon as you can. Without a fully funded emergency fund, you can end up relying on credit cards and other loans to get by and ruin your debt payoff progress in the process.

How much should you save? While most experts recommend having an emergency fund that can cover three to six months of expenses, it’s okay to start small if you have to.

Final Thoughts

Having more than one type of debt is how it works for most people, especially when you’re young and in the early stages of your career. When it comes to paying it off, however, you’ll want to make sure you have a concrete plan that can help you reduce interest charges and get where you want to be. 

Focusing on credit card debt and other unsecured debts first always makes sense, since these debts aren’t secured by an asset and tend to charge much higher interest rates. You can focus on student loans next, followed by other secured debts you have like a home loan or car loan.

In the meantime, make sure you have an adequate emergency fund and invest in it for retirement. After all, debt won’t last forever if you’re serious about repayment, and saving and investing early can help you benefit from compound interest and avoid using credit cards for surprise expenses. Creating a budget to track these factors is your best bet.

If you need help creating one, or simply don’t know where to start, use this budget worksheet as your guide – you’ll reach financial freedom in no time. 

The post Which Debts Should You Pay Off First — Credit Cards or Student Loans? appeared first on Good Financial Cents®.

What are the best ways to avoid sitting in a cubicle all day? Some money-making strategies require an upfront investment, while others let you earn money in your free time with the help of apps.

Read on to learn the best ways to earn cash without a regular 9-5 job, plus tips on how almost anyone can get started.

1. Share Your Opinions

One of the easiest ways to earn money is by signing up to participate in market research studies. You won’t make much, a few dollars here and there, but you can create a free account and get started within minutes.

You’ll be paid in PayPal cash or gift cards for sharing your opinion and completing other tasks online.

E-Poll Market Research is one of the top companies to consider for this type of work. They make it easy to create an account and answer survey questions.

However, there are plenty of other options to consider, including:

• Pinecone Research

• Global Test Market

• E-Poll Market Research

• American Consumer Opinion

• Pro Opinion

• Harris Poll Online

While market research gigs won’t make you rich, it’s something you can do during your spare time.

2. Write an eBook

If you have a book idea, turning your story into an eBook can help you earn passive income without a regular job. Kindle Direct Publishing can even help you format your book for Kindle, at which point you can market and sell your book to millions of potential readers who shop on Amazon.com.

How much can you earn writing eBooks? That depends on how many books you write, how much you sell them for, and how successful you are at marketing your book. Selling 20 books per month with a profit of $7 per book would net you $140 per month and $1,680 per year.

Meanwhile, selling 100 books per month at $7 per book would net you $700 per month and $8,400 per year. Need a little inspiration? Here’s an article that shows you how to make your first $1,000 selling eBooks.

3. Start a Blog and Monetize It

You can earn a lot of money by starting a blog or niche website and monetizing it. I should know. I started Good Financial Cents more than a decade ago, and have earned millions of dollars through the monetization of this site since its earliest days.

How do you make money blogging? Earning real income with a website isn’t as easy as it looks, but there are plenty of monetization strategies you can try.

Here are the most common ways blogs make money:

• Affiliate Sales

• Display Ads

• Sponsorships

• Product Sales

• Sponsored Posts

• And More…

If you’re curious about what it takes to earn money blogging, consider signing up for my Make 1K Challenge. It’s free and can help you earn your first $1,000 online with some of the blog monetization strategies I’ve already mentioned.

4. Start Freelancing

You could argue that freelance work is like a regular job, but working at home and on your terms is much different from traditional employment. The fact is, most freelancers are fully remote – they can work from anywhere in the world with a laptop and an internet connection.

Plus, they can hire and fire clients based on their personal needs and preferences, and their income potential is unlimited. According to ZipRecruiter, freelancers in the U.S. average $63.53 per hour.

Of course, you’ll need a marketable skill to find paid work as a freelancer. This could be freelance writing, design skills, marketing expertise, or something else. 

You can use several websites to market your skills as a freelancer, including:

• Fiverr

• Upwork

• Freelancer.com

• PeoplePerHour

• nDash

5. Get Paid to Lose Weight

HealthyWage makes it possible to earn money while you lose weight. You won’t earn a ton of cash through the app, but you can earn a few dollars and use it to supplement other income you have.

The more weight you lose, the more money you can make. For example, the HealthyWage website claims some of their clients who lost more than 100 pounds managed to earn anywhere from $1,400 to $3,000.

However, the HW weight loss calculator shows potential earnings of $578 to $828 for people who only have 15 pounds to lose.

6. Rent Out Your Car

If you have a car you rarely use and want to earn some side income, you can consider renting it out with Turo, a ride-sharing platform that connects car owners with people who need a short-term rental. You can set your price, although you’ll have more success if you price your car competitively.

Nicer vehicles in high-demand areas can easily fetch rates that surpass $100 per day through this platform. Turo notes that in-demand cars rented out regularly can bring in anywhere from $10,000 to $20,000 per year in net profit.

Plus, almost anyone can rent out their car provided it meets the guidelines of the Turo platform. Your car must be 12 years old or newer with less than 130,000 miles. It must be worth less than $200,000 (no Lambo’s), and you must also meet Turo’s auto insurance requirements.

7. Rent Out a Room

Do you have a spare bedroom in your home that you never use? Maybe you have a basement or garage apartment you could fix up and begin renting for a profit?

Either way, Airbnb lets you rent out rooms and other spaces in your home on any dates you prefer. You must let renters know they’re renting a room in a home vs. an entire apartment or house and provide as much additional detail as possible.

The amount you can earn will depend on where you live and the type of accommodation you can offer. However, expensive cities like Chicago, New York, and San Francisco have plenty of rooms for rent that go for well over $100 per night. 

8. Rent Out Extra Space

You may not have an entire room you can rent, but even if you have some storage space, Neighbor.com allows you to rent it out to others in need. 

Common spaces rented through this platform include

• Garage Space 

• Parking Spaces

• Storage Space for a Boat or an RV

• Empty Lots

• Extra Attic Storage

The Neighbor.com platform makes it easy to advertise your unused space so that people nearby can inquire if they’re interested. Also, note that the platform offers insurance that can protect you if some of your client’s items are damaged or stolen while in your care.

How much can you make renting out extra space? It depends on how much space you have to rent and where it’s located. However, Neighbor.com shows a range of rental space options that cost anywhere from $20 to $100+ per month.

9. Invest In Dividend Stocks

Investing in dividend stocks is one of the best ways to earn money without a regular job. Many early retirees find a way to live and pay bills based solely on the dividends they receive from various stocks.

But what exactly is a dividend stock? For the most part, they are regular stocks but with a track record of sharing their profits with investors through dividends.

Dividends can also be earned in exchange-traded funds (ETFs) or mutual funds, and they can be significant once you build up a large portfolio.

Since dividends are paid by profitable companies, they tend to be seen as less risky for investors. If you’re curious about what it takes to get started with this strategy, this post explains how to invest in dividend stocks.

10. Get Paid to House Sit

Housesitting is an option if you’re somewhat mobile and can move from place to place. Generally, you can find house-sitting gigs through word of mouth, referrals, or online portals like Craigslist.org or Facebook Marketplace.

That said, not all house-sitting gigs are paid. Some offer the potential for exotic travel instead and free lodging for a week to several months.

Either way, a website called TrustedHousesitters is the best place to find house-sitting gigs. Some jobs posted are for house-sitting only, while others require house sitters to provide basic care for pets or plants.

If you have serious wanderlust and want to travel far and wide, this platform can help make it happen. Many gigs posted online are in countries like Australia, Ireland, France, and Switzerland.

11. Take Care of Dogs and Cats

If you love animals and want to earn money taking care of them, several platforms can help turn your dream into a reality.

For example, Rover.com lets you provide basic care for dogs or cats in your home, or you can pick up dog walking gigs. Another mobile app, called Wag!, lets you do more of the same.

You can set your rates for all types of work through these platforms, and your availability. While earnings vary by location and job, most people watch dogs and cats for anywhere from $40 to $100 per night.

12. Invest in Real Estate

Real estate investing may seem like a pipe dream if you hope to earn income without a job but hear me out. There are many ways to earn income through real estate without owning physical property or dealing with the hassles of being a landlord.

You can invest in real estate investment trusts (REITs) that let you build wealth over time. You can also use a platform called Fundrise to invest in real estate with a minimum investment of $10.

Fundrise lets you purchase eREITs, large investment funds that acquire, own, or operate multi-residential and commercial properties. The income you earn is entirely passive since it handles the work of finding income-producing properties and managing them.

While returns are never guaranteed, Fundrise investors have achieved very solid returns. Investors who use the platform earned an average return of 7.31% in 2020, followed by 22.99% in 2021, 1.50% in 2022 and -7.45% in 2023 (their first down year).

• * Minimum investment of $10
• * Open to all investors
• * Online easy to use site and app

Invest now

13. Invest Your Spare Change

You can earn income on your spare change by investing it using Acorns. The roundup savings app syncs to your debit or credit card rounds up every purchase you make to the nearest dollar, and invests the difference. Once it’s set up, there’s no work on your part.

Most of the money is invested in ETFs and managed by the world’s top investment firms like Vanguard and BlackRock. While this app makes it easy to invest small amounts of money, it’s not free to use. Personal plans start at $3 per month, while a family plan costs just $5.

14. Complete Basic Tasks On TaskRabbit

If you’re looking for some paid gigs that are relatively easy, consider setting up a profile on TaskRabbit, an online platform that lets you get paid for completing various tasks, such as:

• Assembling Furniture

• Hanging Pictures

• Wrapping Gifts

• Party Clean-Up

• Running Errands

Projects typically pay between $30 and $100, although some pay significantly more than that. TaskRabbit also lets you pick and choose the jobs you want to take on based on your availability so that you can work entirely on your schedule.

15. Sell Photography

If you love taking photographs and have a knack for getting professional-looking images, you can use your skills and expertise to sell photos online.

Websites like Depositphotos and iStockPhoto pay photographers to supply them with stock photos they can sell to writers, publications, and various online platforms.

The best part about this side hustle is that you can get started with the equipment you already have. While you can use a professional camera if you want to, many smartphones take professional-quality photos.

16. Earn a Bank Bonus

Earning a bank bonus is another way to earn money without a regular job, but you’ll need an upfront investment to get started. Most bonus offers require you to deposit a specific amount of money and keep it in your account for up to 12 months.

You may also be required to set up direct deposit to earn a bank bonus, and other terms and conditions may apply.

Where can you find the best bank bonuses? While bonus offers constantly change, you can start by checking with banks like Chase, HSBC, Radius Bank, and Wells Fargo.

17. Flip Furniture

Flipping furniture requires some upfront legwork and potentially even some artistic talent, but you can earn a solid income with this strategy if you know what you’re doing.

Essentially, this side hustle requires you to shop at thrift stores, garage sales, and online platforms to find furniture that will ultimately sell for more than you paid. 

From there, you can sell the furniture as-is or clean it up and paint it with the goal of fetching an even higher price.

18. Drive for Uber or Lyft

You can make money driving for Uber or Lyft on your own time, picking and choosing the days and hours you want to work.

Not only is rideshare work one of the most flexible side hustles, but you can earn $20 per hour and more with tips.

19. Sell Stuff You Own

If you are low on free time but still want to make money without a job, consider selling stuff you don’t need. An array of online platforms makes it a breeze, although some platforms work better for selling.

For example, you can use Poshmark to earn money selling used clothing and accessories, while used electronics tend to sell best on platforms like eBay.com, Decluttr, BuyBackWorld, and Gazelle.

If you have home decor, furniture, or workout equipment to sell, you’ll almost always do better unloading those items locally on Facebook Marketplace.

20. Start a YouTube Channel

Starting a YouTube channel is another way to earn money without a job, but that doesn’t mean it’s not work. The fact is, that creating quality videos and building an audience takes a lot of creativity and time. Plus, not everyone who tries to build a YouTube channel will succeed.

That said, you can earn income without a regular job. I know because I have done it with my YouTube channel, Wealth Hacker. 

How much you can earn on YouTube varies quite a bit, but it’s possible to earn thousands of dollars per month. If you’re curious about monetizing videos, my in-depth guide will show you how to make money on YouTube.

21. Donate Plasma

Donating plasma is a unique way to earn money without a job, although it’s not very glamorous. DonatingPlasma.org makes it easy to find plasma donation centers in your area, and you can earn as much as $100 for your first donation.

That said, subsequent plasma donations typically earn closer to $50. You’ll also be limited by the number of times you can donate plasma within a month. However, it’s possible to use this side gig to earn an extra $500 per month, which you can use to supplement your primary income.

22. Become a Crowdworker

If you are willing to complete various tasks that help regular workers do their jobs, consider becoming a crowd worker. This gig will have you finishing up to-do lists of jobs that don’t require specific technical skills.

For example, you may get paid to proofread documents, label images, update a resume, complete a form, or complete a data entry assignment.

Several platforms help you find crowd-working gigs, but the best ones include Microworkers and Clickworker. 

23. Shop for Groceries

If you want to do something simple that will get you moving, consider delivering groceries using apps like Instacart or Shipt. You get paid hourly, plus tips and all you have to do is head to the store, purchase groceries according to a list, and deliver them to people in your neighborhood.

The gig is extremely flexible, similar to driving for Uber or Lyft.

24. Deliver Packages With Amazon Flex

Another non-job gig lets you get paid to deliver packages for Amazon.com. You can do this through a platform called Amazon Flex, which promises its drivers anywhere from $18 to $25 per hour. 

Unlike a regular Amazon job, Flex lets you pick the day and the hours you want to work. To get started, you need to create a free account, get approved, and start reserving blocks of time you want to deliver packages. 

25. Sell Unwanted Gift Cards

Finally, you can earn money by selling unwanted or unused gift cards in your possession. This hustle is made easy thanks to platforms like GiftDeals.com and CardCash.com. 

You won’t get the total value of your gift cards, but you should get 90% or more of the gift card balance for each card you sell. While selling gift cards for less than their total value may not seem ideal, it’s better than not using them and getting nothing in return.

26. Take Online Surveys

Finally, you can earn small amounts of money by signing up with the best online survey sites. Not only is this side hustle as easy as it gets, but you can participate and get paid during your spare time and even on your phone.

Other online survey sites to check out include the following:

• Swagbucks

• Inbox Dollars

• Ipsos iSay

• LifePoints

With all this being said, you’ll want to keep in mind that most surveys only pay a few bucks and that some only pay you with gift cards, while others offer the option for PayPal transfers. Make sure you understand how each survey site works and how you get paid before you sign up.

Final Thoughts on Making Money Without a Job

There you have it, 26 ways to make money without a job. While many of the jobs on our list won’t replace your 9-5, they can be a great way to increase your income so you can pay off debt or break the cycle of living paycheck to paycheck.

Check out the video below if you’re looking for even more ways to make money.

The post How to Make Money Without a Job: 26 Ways to Earn Money Outside the 9-5 appeared first on Good Financial Cents®.

As a Certified Financial Planner, I see underinsured people every day.

What do I tell them?

A million-dollar term life insurance policy might actually be the minimum coverage needed for the typical middle-class household, but it’s affordable.

That might sound like an exaggeration, but if you crunch the numbers – just as we’ll be doing a little bit – you’ll realize that a million-dollar policy might be just what you need.

The good news is term life insurance isn’t nearly as costly as most people think.

What makes term life insurance even better is that larger policies cost less on a per thousand basis than smaller policies do. You may find the premium on a $1 million policy is only a little bit higher than it is for $500,000.

Do You Really Need a $1 Million Term Life Insurance Policy?

Probably, but let’s find out. A general rule of thumb is that you should get 10x your income as baseline coverage for life insurance.

If you’re young, that may be low because you may want to provide your family with enough to replace your income for 15 years or more.

Today, $1 million has become the new baseline for life insurance by a primary breadwinner. Anything less could leave your family financially impaired.

Typical Obligations to Add When Calculating the Amount You Need

Here’s a list of all the different obligations you may want to have life insurance cover in the unfortunate event you pass away early.

• Your Income (And for How Many Years)

• Your Final Expenses

• Any Debt You May Want to Be Settled

• Future Obligations Such as College for Children

• Other Obligations Such as Business

• Typical Items You Can Subtract When Calculating the Amount You Need

• Current Life Insurance Policies

• Assets (Like Cash or Stock) You Might Choose to Use Instead of Life Insurance

Now that you have an idea of these obligations, let’s punch them into this life insurance calculator to find out if you need a million-dollar policy.

Choosing A Million Dollar Insurance Policy

According to Policy Genius, the average cost for a 20-year $1 million term life insurance policy for a 35-year-old male is $53 per month. However, your rate will vary according to the following factors.

Factors that affect your rate:

• Your Age

• Your Health

• Your Gender

• Your Hobbies

• Your Coverage Amount and Policy Term

Where to start?

The best, and easiest place to start is online. I recommend having two or three insurers compete for your business to make sure you get the best rate and coverage. To see how cheap term life can be, choose your state from the map above to be matched with top life insurance providers instantly.

Factors That Affect How Much You Need

Let’s look at the individual components that can quickly add up to over a million-dollar policy.

Income Replacement

This is where things can get a bit intimidating. Even if you earn a modest income, you may need close to $1 million to replace that income after your death in order to provide for your family’s basic living expenses.

The conventional wisdom in the insurance industry is that you should maintain a life insurance policy equal to between 10 times and 20 times your annual income. So if you earn around $50K per year, that would mean policy coverage between $500K and $1 million.

The complication today is that with interest rates being as low as they are that might not be enough either.

For example, if you have a $1 million policy that could be invested at 5% per year, your family could live on the interest earned – which conveniently comes to $50,000 per year – for the next 20 years.

That would still leave the original $1 million intact to cover other expenses. But with today’s microscopic interest rates, there’s no way to get a guaranteed return of 5% on your money, certainly not for 15 or 20 years.

Also, keep in mind that most insurance companies have a maximum multiplier you can apply to your income for life insurance coverage. For example, it wouldn’t make much sense for a 22-year-old making $27,000 per year to get a $2 million life insurance. Or a 65-year-old that is retired to secure a $3 million dollar policy.

The table below is approximately how much you’re allowed to multiply your income based on your age and income:

Using the table above as a guide, a 35-year-old making $150,000 per year would be capped at taking out a $4.5 million term policy ($150,000 x 30 = $4,500,000).

Your Final Expenses

Here we start with the basics – wrapping up your final affairs.

This will include funeral costs and any lingering medical costs. A reasonable estimate for a typical funeral is around $20,000.

Crazy, right? You can get burial insurance to cover only the most basic of final expenses.

Outstanding Debt

Debt burdens are high in the US, and debt can be especially crushing on remaining family members. Many life insurance customers make sure they can pay off most of their debt with the policy.

Medical Debt

Medical costs are a serious variable. Even if you have excellent health insurance, there are likely to be unpaid medical bills lingering after your death. This has to do with copayments, deductibles, and coinsurance provisions.

Collectively, they can add up to many thousands of dollars. But where things get really complicated is if you die of a terminal illness.

For example, if you are stricken by an illness that lasts for several years, you could incur a number of expenses that are not covered by insurance. This may include the cost of personal care and even experimental treatments.

Mortgage

A home may be a large asset, but it’s also often a homeowner’s largest debt. The average mortgage balance in the US is roughly $236,443 according to Experian data. So you could easily use a life insurance policy to pay off that debt and relieve your loved ones of a monthly mortgage payment. 

Personal Debt

Credit card debt and other personal debt are some of the most expensive obligations carrying rates upward of 20% in some cases. Make sure you have enough to cover this very expensive debt.

Future Obligations For Your Family

Below is a sampling of major expenses your family is likely to incur, either on an annual basis or at some point after your death.

College

Tuition costs continue to skyrocket. The Department of Education suggests that four-year public college tuition has been rising an average of 5% per year, far exceeding the rate of inflation. If you have one child who attends an in-state public school, a second at an out-of-state public school, and a third in a private university, the total expenditure will reach $416,560.

• Annual cost at in-state public college: $20,770 ($83,080 for four years)

• Annual cost at out-of-state public college: $36,420 ($145,680 for four years)

• Annual cost at a private college: $46,950 ($187,800 for four years)

Transportation

Vehicles and other forms of transportation represent another large sum. Unfortunately, with increasing electronics and safety features, the average cost of a new car continues to grow.

Health Insurance

If your family relies on your work for healthcare, take notice. According to eHealth.com, the average health insurance premium for a family is $22,221. That’s a shade under $2,000 per month in additional cost. This cost will only rise, and the need could last for years.

Other Obligations You May Need to Cover

So far, we’ve been describing the financial obligations likely to affect a typical household.
But there may be certain situations that will produce obligations that are less obvious.

Business Owners

For example, if you’re a business owner, there may be debts or other financial obligations that will need to be paid upon your death.

Even though no one in your family may be qualified or interested in taking over your business, the payoff of those obligations may be completely necessary to enable the sale of the business.

Real Estate Investor

Another possibility is that you’re a real estate investor.

If your properties are heavily indebted, extra insurance proceeds may be necessary either to carry the properties until they’re sold, or even to pay off existing indebtedness to free up cash flow for income.

You may even need additional funds if you are taking care of an extended family member, like an aging parent.

These are just some of the many possibilities of expenses that will need to be covered by insurance proceeds.

Factors Affecting Your Life Insurance Premiums

Before we move on to specific life insurance quotes, let’s first consider the factors that affect term life insurance premiums.

Age

This is typically the single most important premium factor. The older you are, the more likely you are to die within the term of the policy.

Health

This is a close second and why it’s so important to apply for a policy as early in life as possible. Premiums on life insurances rates literally increase by each year.

If you have any health conditions that may affect mortality, such as diabetes or hypertension, your premiums will be higher. This is another compelling reason to apply while you are young and in good health.

It’s not that policies are not available to people with health conditions, it’s just that they’re less expensive if you don’t have any.

Policy Term

A 10-year term policy will have a lower premium than a 20-year term policy, which will be lower than a 30-year term. The shorter the term, the less likely it is the insurance company will have to pay a claim before it expires.

Policy Size

Size of the policy matters, but not the way you might think. Yes, a $1 million policy will cost more than a $500,000 policy. But it won’t cost twice as much.

The larger the policy, the lower the per-thousand cost will be.

When the size of the death benefit is considered, the larger policy will always be more cost-effective.

Work, Hobbies, and Habits

For example, certain occupations are more hazardous than others (think policeman versus librarian). Deep-sea diving is higher risk than golf. And smoking is the one activity guaranteed to raise your premiums substantially.

With this information in mind, let’s take a look at whether you should consider a $1 million whole life policy instead.

$1 Million Term Life Insurance vs Whole Life?

Any discussion on life insurance should include a comparison of whole life and term life insurance coverage. After all, both products can be immensely valuable in the right situation, yet one product (whole life) costs considerably more than the other.

Most of the time, the debate is settled in favor of term life insurance based on cost alone.

With that being said, whole life insurance and other investment-type life insurance coverage can be valuable in terms of the cash value you can build up over time. Whole life insurance also offers a fixed benefit amount for your heirs that will last for your entire life, yet the cost of your premiums are guaranteed to stay the same.

The cash value of a whole life insurance policy also grows on a tax-deferred basis, and you can borrow against this amount if you need a loan. Further, many whole life policies from reputable providers also pay out dividends during good years, which can be substantial.

Why Young Families Choose Term Coverage

The problem with whole life and other similar policies like universal life is the fact that premiums can be exorbitant for the amount of coverage you might need.

A couple with young children provides a good example since they might need a $1 million dollar policy or more to provide income protection for their working years and have money left for college tuition and other expenses.

With young families, expenses are already high.

This includes costs for food for a family, childcare, heavy use of health care, and the seemingly endless demand for clothing, furniture, and even entertainment as the children grow.

As you can see from the cost comparison below from State Farm, there’s not enough room in the typical family budget to afford the type of life insurance that’s needed.

A 40-year-old mother and breadwinner in excellent health would pay $80.09 per month for a term life policy that lasts 20 years, whereas a whole life policy in the same amount would cost $1,266.69 per month (or $14,560 annually).

This is a classic situation where term insurance rides to the rescue. The family can afford to buy the amount of coverage they need at an affordable price, whereas paying for permanent life insurance coverage in the same amount would be difficult to justify.

And just as important for people of any age and in any circumstance, the extra funds not being spent on insurance premiums can be invested to gradually improve your financial situation.

So absolutely, term insurance will work best for most people.

$1 Million Life Insurance Rate Examples

As you’ll notice, each table has a wide array of information. Knowing that everybody is in a different situation, I wanted to make sure that I offered term life quotes for almost every conceivable situation.

I’ve included life insurance rates for a 30-year term, 20-year term, and a 10-year term million dollar life policies. If you’re a tobacco user, I’ve also included some quotes from life insurance for smokers.

30-Year $1 Million Term Life Policy

For those that think that a million-dollar term policy is expensive, you’ll quickly notice that a 25-year-old male in good health only costs $645 per year while a 35-year-old costs $795.

On a monthly basis that’s almost next to nothing!

20-Year $1 Million Term Life Policy

There is a big drop-off in life insurance rates between a 20 year and a 30 year since underwriters do not have to worry as much about life expectancy.

For many people, a 20-year policy gets them exactly where they want to be in life when the policy term runs out.

10-Year $1 Million Term Life Policy

Once again, you get a $200 drop in the annual premium by losing another 10 years on the term.

If your life insurance agent isn’t giving you all these term options and is only focused on the death benefit, then you need a different agent.

$1 Million Policy for Smokers – Rates Increase

For all you smokers out there – beware! The cost of your life insurance balloons as you’ll see here. If you’re considering kicking the habit, now is as good time as any.

Some life insurance companies will give you a lower rate if you complete a recognized smoking cessation program, and go on without smoking for at least two years.

It won’t help your immediate situation, but when you see the premium on smoker life insurance rates below, you might agree that it’s something to work toward!

10 steps to securing a million life insurance policy:

If you’ve made the decision that $1 million of life insurance is the right amount of coverage you need and you’re ready to purchase a policy, here are the steps you’ll need to follow.

1. Determine How Much Coverage You Need: This is the first and most important step in securing a million life insurance policies. You need to have a clear understanding of how much coverage you actually need.

2. Choose the Right Type of Policy: There are whole life, term life, and Universal life policies available. Choose the one that best suits your needs.

3. Shop Around: Don’t just go with the first life insurance company you come across. It’s important to compare life insurance rates and coverage from a few different companies before making a decision.

4. Consider Your Health: If you’re in good health, you’ll likely qualify for lower rates. However, if you have health issues, you may still be able to get coverage, but it will probably be more expensive.

5. Consider Your Lifestyle: If you have a risky job or hobby, that could affect your rates.

6. Get Quotes From Multiple Companies: This is the best way to compare rates and find the cheapest policy.

7. Read the Fine Print: Make sure you understand all the terms and conditions of the policy before buying it.

8. Buy Online: You can usually get cheaper rates by buying life insurance online.

9. Pay Attention to Your Payment Schedule: Most life insurance policies require monthly or annual payments. Be sure you can afford the payments before buying a policy.

10. Review Your Policy Regularly: Life changes, and so do life insurance needs. Be sure to review your policy regularly to make sure it still meets your needs.

Following these steps will help you get the best possible rate on a million-dollar life insurance policy.

Make sure you understand all the terms and conditions before signing on the dotted line. Also, make sure to shop around and compare rates from multiple companies before buying a policy.

Yes, I know I’ve said that a few times in this article, but it’s worth repeating. Many people go with the first life insurance company they call, and that isn’t kind to their checkbook. It pays to shop around.

Here’s what you need to know about choosing the best life insurance company for your $1 million policy:

The Best Companies to Purchase $1 Million Life Insurance

When choosing the best life insurance company, it’s important to consider the overall financial health of the insurance company. You want to make sure the company you choose is stable and will be around for years to come. You also want to consider things like the company’s customer service rating and claims-paying ability.

There are a lot of different life insurance companies out there, so it can be difficult to know which one is the best. Each company is rated by different organizations, so it’s important to look at multiple ratings before making a decision.

The companies that rate insurance companies are A.M. Best, Moody’s, and Standard & Poor’s.

A.M. Best is a credit rating agency that specializes in the insurance industry. They rate insurance companies on their financial stability.

Moody’s is another credit rating agency. They also rate insurance companies on their financial stability.

Standard & Poor’s is a credit rating agency that rates companies on their financial stability.

The following life insurance companies are all rated A+ (Superior) by A.M. Best and are considered to be financially stable and have a good claim-paying ability.

1. Northwestern Mutual

2. New York Life

3. MassMutual

4. Guardian Life

5. State Farm

6. Nationwide

7. USAA

8. MetLife

9. The Hartford

10. Allstate

Here are those same top life insurance companies with their respective ratings:

These are just a few of the many life insurance companies out there that could provide you with a $1 million life insurance policy.

When choosing a life insurance company, it’s important to consider their financial stability, customer service rating, and claims-paying ability. The companies listed above are all rated A+ (Superior) by A.M. Best and are considered to be financially stable with a good claims-paying ability.

Northwestern Mutual, New York Life, MassMutual, Guardian Life, State Farm, Nationwide, USAA, MetLife, The Hartford, and Allstate are all good choices for life insurance companies.

You can’t put a price on peace of mind, and with a $1 million life insurance policy you can have the peace of mind knowing that your loved ones will be taken care of financially if something happens to you.

Bottom Line: How Much Does A $1 Million Dollar Life Insurance Policy Cost?

Getting a one-million-dollar term life insurance policy is not as expensive as most people believe. You can start getting quotes today from a variety of top life insurers by selecting your state from the map above.

Even those who opt for the more expensive permanent life insurance policy will many times be surprised at the price.

Either way, you can get these larger amounts of coverage and still not break the bank. But get your policy now, while you’re still young and in good health.

FAQ’s on $1 Million Life Insurance Policy

The post How Much Does A Million Dollar Life Insurance Policy Cost? appeared first on Good Financial Cents®.

Even though I had this “exclusive access” it took me a while to start investing in alternative asset classes.

The Securities and Exchange Commission states that as an accredited investor, I possess a level of sophistication that equips me to craft a riskier investment portfolio than a non-accredited investor. While this might not be universally true for everyone, in my case, I had demonstrated the financial resilience to bear more risk (see barbell investing), especially if my investments took an unforeseen downturn.

One of the intriguing aspects I discovered was that investment opportunities for accredited investors aren’t mandated to register with financial authorities. This means they often come with fewer disclosures and might not be as transparent as the registered securities available to the general public.

The underlying belief is that my status as a sophisticated investor implies a deeper understanding of financial risks, a need for less disclosure of unregistered securities, and a conviction that these exclusive investment opportunities are apt for my funds.

On a personal note, as a practicing CFP®, I haven’t always worked with accredited investors. Early in my career, I didn’t quite grasp the allure. However, as time went on, I began to see the broader spectrum of investment options available to accredited investors.

As I learned more the clearer it became why this realm was so sought after. The variety and potential of these exclusive opportunities were truly eye-opening, reshaping my perspective on the world of investing.

Introduction to Accredited Investors

An accredited investor is an individual or a business entity that is allowed to trade securities that may not be registered with financial authorities. They are entitled to this privileged access because they satisfy one or more requirements regarding income, net worth, asset size, governance status, or professional experience.

The concept of an accredited investor originated from the idea that individuals or entities with a higher financial acumen or more resources are better equipped to understand and bear the risks of certain investment opportunities.

Historically, the distinction between accredited and non-accredited investors was established to protect less experienced investors from potentially risky or less transparent investment opportunities.

Regulatory bodies, such as the U.S. Securities and Exchange Commission (SEC), have set criteria to determine who qualifies as an accredited investor, ensuring that they have the financial stability and sophistication to engage in more complex investment ventures.

Criteria for Becoming an Accredited Investor

To be classified as an accredited investor, one must meet specific criteria set by regulatory bodies:

Best Investment Opportunities for Accredited Investors

Here’s a rundown of some of the top investments for accredited investors…

1. Fundrise

• Minimum Investment: $500

• Best for Newbie Investors

Fundrise has revolutionized the real estate investment landscape. By democratizing access to real estate portfolios, it allows individuals to invest without the complexities of property management or the need for vast capital. The platform’s innovative approach provides exposure to a traditionally lucrative, yet often inaccessible, sector of the market

Through Fundrise, investors can access a diversified range of properties, from commercial ventures to residential units. The platform’s expert team curates these portfolios, ensuring a balance of risk and reward. With its user-friendly interface and transparent reporting, Fundrise has become a top choice for many venturing into real estate investments.

How It Works

Investors start by choosing a suitable investment plan on Fundrise. Once invested, the platform pools the funds with other investors and allocates them across various real estate projects. As these properties generate rental income or appreciation in value, investors receive returns in the form of dividends or appreciation.

Pros & Cons

2. Equitybee

• Minimum Investment: $10,000
• Best for: Experienced Investors

Equitybee offers a unique platform that bridges the gap between private companies on the cusp of going public and potential investors. This innovative approach provides a golden opportunity for investors to tap into the potential of startups and other private firms before they make their public debut.

The platform’s primary focus is on employee stock options. By allowing investors to invest in these options, they can potentially benefit from their appreciation as the company grows. With a vast array of companies, from emerging startups to established giants, Equitybee presents a diverse range of investment opportunities.

How It Works

Investors browse available stock options from various companies on Equitybee. Once they choose an option, they invest their funds, which are then used to purchase the stock options from the employees. If the company goes public or gets acquired, the investor stands to gain from the increased value of these stocks.

3. Percent

• Minimum Investment: $500

• Best for Novice Investors

Percent stands as a beacon in the vast sea of the private credit market, illuminating a sector often overshadowed by traditional investments. This burgeoning market, valued at over $7 trillion, consists of companies borrowing from non-bank lenders. Percent offers a unique vantage point into this market, allowing investors to diversify their portfolios beyond typical stocks and bonds.

The allure of Percent lies in its ability to offer shorter terms and higher yields, combined with investments that are largely uncorrelated with public markets. This makes it an attractive proposition for those looking to step away from the volatility of traditional markets.

How It Works

Upon joining Percent, investors are presented with a plethora of private credit opportunities. After selecting an investment, funds are pooled with other investors and lent out to companies seeking credit. As these companies repay their loans, investors earn interest, providing a steady income stream.

4. Masterworks

• Minimum Investment: $10,000

• Best for Novice Investors

Masterworks paints a vivid picture of art investment, blending the worlds of finance and fine art. Traditionally, investing in art was a luxury reserved for the elite. However, Masterworks has democratized this, allowing individuals to buy shares in artworks from world-renowned artists.

The platform’s strength lies in its expertise. From authentication to storage, every facet of art investment is handled meticulously. This ensures that investors can appreciate both the beauty of their investments and the potential financial returns.

How It Works

After registering on Masterworks, investors can browse a curated selection of artworks. They can then purchase shares, representing a fraction of the artwork’s value. Masterworks take care of storage, insurance, and eventual sale. When the artwork is sold, investors share the profits based on their ownership.

5. Yieldstreet

• Minimum Investment: $15,000

• Best for: Advanced Investors

Yieldstreet stands at the intersection of innovation and alternative investments. It offers a smorgasbord of unique investment opportunities, ranging from art to marine finance. For those looking to venture beyond the beaten path of traditional stocks and bonds, Yieldstreet presents a tantalizing array of options.

The platform’s allure lies in its curated selection of alternative investments, each vetted by experts. This ensures that while investors are treading unconventional grounds, they’re not stepping into the unknown blindly.

How it Works

Investors begin by browsing through the diverse investment opportunities on Yieldstreet. After selecting their preferred asset class, their funds are pooled with other investors and allocated to the chosen venture. Returns are generated based on the performance of these assets, be it through interest, dividends, or asset appreciation.

6. AcreTrader

• Minimum Investment: $10,000

• Best for Newbie Investors

AcreTrader, as its name suggests, brings the vast expanses of farmland to the investment table. It offers a unique opportunity to invest in agricultural land, combining the stability of real estate with the evergreen nature of agriculture. With the global population on the rise, the value of fertile land is only set to increase.

The platform meticulously vets each piece of land, ensuring only the most promising plots are available for investment. This rigorous process ensures that investors are planting their funds in fertile ground, poised for growth.

How It Works

Investors peruse available farmland listings on AcreTrader. After selecting a plot, they can invest, effectively owning a portion of that land. AcreTrader manages all aspects, from liaising with farmers to ensuring optimal land use. Investors earn from the appreciation of land value and potential rental income.

7. EquityMultiple

• Minimum Investment: $5,000

• Best for: Experienced Investors

EquityMultiple is a testament to the power of collective investment in the real estate sector. By leveraging the principles of crowdfunding, it offers a platform where multiple investors can pool their resources to finance high-quality real estate projects. This collaborative approach allows for diversification and access to projects that might be out of reach for individual investors.

The platform’s strength lies in its curated selection of real estate opportunities, ranging from commercial spaces to residential properties. With a team of seasoned real estate professionals at the helm, EquityMultiple ensures that each project is vetted for maximum potential and minimal risk.

How It Works

Upon joining, investors can explore a variety of real estate projects. After committing to a project, their funds are pooled with other investors to finance the venture. Returns are generated through rental incomes, property appreciation, or the successful completion of development projects.

8. CrowdStreet

• Minimum Investment: $25,000

• Best for: Advanced Investors

CrowdStreet stands as a pillar in the commercial real estate investment domain. With its vast experience and industry connections, it offers a platform where investors can tap into prime real estate projects across the nation. From bustling urban centers to tranquil suburban locales, CrowdStreet provides a diverse range of investment opportunities.

The platform’s expertise ensures that each project is meticulously vetted, offering a blend of potential returns and stability. For investors looking to delve into commercial real estate without the hassles of property management, CrowdStreet is an ideal choice.

How It Works

After registration, investors can browse a myriad of commercial real estate offerings. Upon investing in a project, CrowdStreet manages the investment, providing regular updates and ensuring optimal project execution. Investors earn returns based on the project’s performance, be it through rentals, sales, or project completions.

9. Mainvest

• Minimum Investment: $100

• Best for Newbie Investors

Mainvest offers a refreshing twist in the investment landscape, focusing on the heart and soul of the American economy: local businesses. From quaint cafes to innovative startups, Mainvest provides a platform where investors can support and benefit from the growth of small businesses in their communities.

The platform’s community-centric approach ensures that investments are not just about returns but also about fostering local economies. For those looking to make a difference while earning, Mainvest presents a unique opportunity.

How It Works

Investors can explore various local businesses seeking capital on Mainvest. By investing, they essentially buy a revenue-sharing note, earning a percentage of the business’s gross revenue until a predetermined return is achieved.

10. Vinovest

• Minimum Investment: $1,000

• Best for Novice Investors

Vinovest uncorks the world of wine investment, offering a blend of luxury, history, and financial growth. Fine wines have been a symbol of opulence for centuries, and Vinovest provides a platform where this luxury becomes an accessible investment.

With a team of wine experts guiding the way, the platform ensures that each wine is not just a drink but an investment poised for appreciation. From sourcing to storage, Vinovest handles every facet, ensuring the wine’s value grows over time.

How It Works

After signing up, investors set their preferences and investment amounts. Vinovest then curates a wine portfolio based on these preferences, handling sourcing, authentication, and storage. As the wine appreciates, so does the investor’s portfolio.

11. Arrived Homes

• Minimum Investment: $100

• Best for Novice Investors

Arrived Homes offers a fresh perspective on real estate investment, focusing on the charm of single-family homes. While skyscrapers and commercial complexes often dominate real estate discussions, single-family homes offer stability, consistent returns, and a touch of nostalgia.

The platform’s strength lies in its focus. By concentrating on single-family homes, it offers investors a chance to tap into a stable real estate segment, benefiting from both rental income and property appreciation.

How It Works

Investors browse available properties on Arrived Homes. After selecting a property, they can invest in shares, representing a portion of the home’s value. As the property is rented out, investors earn a share of the rental income. Additionally, any appreciation in property value benefits the investors.

12. RealtyMogul

• Minimum Investment: $5,000

• Best for: Novice to Experienced Investors

RealtyMogul stands tall in the commercial real estate investment landscape. It offers a platform where diversification meets opportunity, presenting a range of commercial properties for investment. From bustling office spaces to serene residential complexes, RealtyMogul provides a plethora of options for investors to expand their portfolios.

The platform’s prowess lies in its dual approach. Investors can either dive into non-traded REITs or make direct investments in specific properties. This flexibility ensures that both novice and experienced investors find opportunities that align with their investment goals.

How It Works

Upon joining RealtyMogul, investors can choose between REITs or direct property investments. Their funds are then channeled into these real estate ventures. Returns are generated through rental incomes, property sales, or successful project completions.

The Future of Accredited Investing

The world of accredited investing is dynamic and ever-evolving. Emerging trends suggest a shift towards democratizing investment opportunities, with regulatory bodies considering more inclusive criteria for accredited investor status. This shift aims to balance the need for investor protection with the recognition that financial acumen can come from experience and education, not just wealth.

Furthermore, technological advancements are playing a pivotal role. The rise of blockchain and tokenized assets, for instance, is creating new avenues for investment and might reshape the landscape of opportunities available to accredited investors.

As the line between traditional and alternative investments blurs, the future promises a more integrated, inclusive, and innovative environment for accredited investors.

The Bottom Line – Top Investments for Accredited Investors

Understanding the role and opportunities of accredited investors is crucial in the modern financial landscape. While the distinction offers privileged access to unique investment opportunities, it also comes with increased risks and responsibilities.

As the world of investing continues to evolve, potential accredited investors are encouraged to stay informed, conduct thorough research, and seek professional advice. The realm of accredited investing, with its blend of challenges and opportunities, promises exciting prospects for those ready to navigate its complexities.

The post 13 Best Investment Opportunities for Accredited Investors appeared first on Good Financial Cents®.

Nakamoto launched the Bitcoin network just a year later and began mining the currency— an estimated 1 million bitcoins were mined in the early years.

The creator(s) of this first-of-its-kind asset developed the cryptocurrency in response to the Great Recession of 2007-2009, spurred by a distrust of the traditional banking system and concerns about its stability. 

Given the recent values of Bitcoin, it’s hard to believe the currency first started trading on exchanges in 2010 at under $0.10. Since then, it’s experienced astronomical growth and some pretty wild price swings.

At its most recent high, one bitcoin was worth over $64,000—a far cry from trading for pennies in its earliest days. 

Whether you’re thinking of investing in Bitcoin or you’ve held this cryptocurrency for several years, it’s fun to look back at this groundbreaking asset’s history. Read on for insights on Bitcoin milestones, historical returns, and how its returns compare to those of other assets.

Bitcoin Performance Milestones

Since being created, Bitcoin has experienced several milestones. Here’s a look back at some of the most significant moments in the short history of this cryptocurrency:

• In March 2010, Bitcoin began trading on the now-defunct Bitcoin Market, one of the first-ever cryptocurrency exchanges.

• A Florida man named Laszlo Hanyecz bought pizza with 10,000 bitcoins in May 2010, making it the first time anyone used the currency to purchase something.

• In June 2011, Bitcoin saw its first significant price spike, climbing to a value of $29.60 (up from just $0.30 in January) before declining again later that year.

• The second half of 2013 marked another major spike—from $68 on July 4th to $1,237 on December 3rd before declining again.

• One of Bitcoin’s most significant increases happened in 2017, with its value surging from around $1,000 at the start of the year to $19,345 by mid-December. 

• The Bitcoin hype cooled in 2018, resulting in significant declines—its lowest value was around $3,232 in December of that year.

• In 2019, Bitcoin saw another spike, hitting $13,813 on June 26th before declining.

• After seeing modest ups and downs through October 2020, Bitcoin’s value began to surge again. It hit an astronomical high of over $68,000 in November 2021.

• Bitcoin dropped by over 75% in 2022

• Bitcoin continues to hover around the $30k mark in 2023

Bitcoin Total Return (10 Year, 5 Year, 3 Years, 1 Year)

While Bitcoin isn’t exempt from the volatility cryptocurrencies often experience, it’s delivered some impressive returns over the years. Here’s a look at Bitcoin’s annual returns from 2010 to 2022:

And here’s a look at monthly returns, if you feel like getting a deeper dive:

While Bitcoin has experienced some wild monthly price swings and a couple of years where its value has declined, you can see that its declines have been eclipsed by some incredible gains. Now let’s explore how Bitcoin’s value has changed over 10, 5, 3, and 1 years.

Bitcoin 10-Year Return

Let’s say you bought one bitcoin on August, 3rd 2013, for $1,106.75, its price at the time. If you held that one bitcoin until August 3rd, 2023, it would’ve been worth $29,310.44, and your total ROI for the 10 years would be 2,546.8%.

Bitcoin 5-Year Return

We’ll also assume you purchased one Bitcoin for this example. A single bitcoin was valued at $965.31 on August, 3rd, 2018, and its value climbed to $29,310.44 by August 2023. Using our calculation above, your total ROI for those five years would be 294.1%.

Bitcoin 3-Year Return

A single bitcoin was valued at $11,246.20 in August 2020, and its value climbed to $29,310.44 at the end of 2021. Your total ROI for those three years would be 160.6%.

Bitcoin 1-Year return

If you purchased a single bitcoin in August 2022, you would’ve paid around $22,626.83. In one year, that value would’ve increased to $29,310.44. Your total returns for that year would be 29.54%.

Bitcoin Multi-Year Returns Compared

How Much You’d Have If You Invested $1,000 in Bitcoin 10, 5, 3, or 1 Year Ago

Instead of buying one bitcoin, let’s say you decided to invest $1,000 into Bitcoin. Here’s a look at how this $1,000 investment would’ve performed if you bought and held your Bitcoin for 10, 5, 3, and 1 years.

While Bitcoin’s earliest investors would have benefitted the most from buying and holding their Bitcoin, those who’ve invested recently also fared well.

How Does Bitcoin Compare to Other Asset Classes?

If you’re curious how Bitcoin returns compare to those of other asset classes, here’s how its annual and total returns compare to gold, real estate, and the S&P 500.

(Spoiler alert: Bitcoin outperformed all three assets by an enormous margin.)

Bitcoin vs. Gold

If you compare Bitcoin’s returns to gold’s returns, you’ll notice a stark difference. Bitcoin has an average annual return of 1,576% and a total return of 18,912% from 2010 to 2022, while SPDR Gold Shares had an average annual return of just 5.14% and a total return of 61.67% over the same period. 

Bitcoin vs. Real Estate

Let’s see if real estate fared any better compared to Bitcoin. The cryptocurrency delivered a whopping 1,576% average annual return and an 18,912% total return from 2010 to 2021, while the Vanguard Real Estate ETF had an average annual return of 13.49% and a total return of 161.91% over the same period.

So, real estate saw slightly higher returns than gold, but it still didn’t come close to Bitcoin’s returns.

Bitcoin vs. S&P 500 (Stock Market)

The S&P 500 didn’t fare too much better in its head-to-head with Bitcoin. From 2011 to 2023, the Vanguard S&P 500 ETF delivered an average annual return of 15.74% and a total return of 173.14%. While those numbers aren’t too shabby, Bitcoin’s average annual return for the same period was a whopping 819%, and its total return was 9,012%.

How Does Bitcoin Compare to The Best Performing Stocks?

We’ve analyzed how Bitcoin compares to gold, real estate, and the stock market, but how does it stack up against some of the best-performing stocks? Here’s how this popular cryptocurrency stacks up against major companies like Amazon, Apple, Berkshire Hathaway, JP Morgan, Microsoft, Visa, and Walmart.

We looked at the average annual and total returns for each asset. This data assumes you bought the asset in 2010 and held it until 2023. 

The Bottom Line – Bitcoin Historical Returns

While some investors may be skeptical about cryptocurrency, citing concerns over market volatility and a high risk of loss, Bitcoin’s performance over time paints a rosy picture. With its longevity and astronomically high returns, Bitcoin has been worth the risk for many investors—especially early adopters. 

Of course, historical performance doesn’t guarantee future returns. So if you’re considering investing in cryptocurrency, only invest what you can afford to lose.

The post Bitcoin Historical Annual Returns (10 Years, 5 Years, 3 Years, 1 Year) appeared first on Good Financial Cents®.

Unlike active income, where earnings are directly linked to the amount of work performed, passive income flows whether you are working, sleeping, or vacationing.

As Robert Kiyosaki (2017) explains in his best-selling book “Rich Dad Poor Dad,” passive income can be a way to achieve greater financial independence.

Unlike the typical income that requires constant work, passive income typically flows with less hands-on involvement. However, this doesn’t mean no work is involved; it’s often the initial setup that demands considerable time, effort, or capital.

31 Passive Income Ideas

Purpose and Importance

The purpose of passive income is broad, spanning from financial cushioning to the possibility of early retirement. Generating continuous revenue without daily effort offers a means to enhance one’s lifestyle, build financial security, or pursue other interests and hobbies.

The significance of passive income goes beyond mere monetary gain, as it also provides a pathway to greater control over one’s time, a diversified income stream, and potential long-term growth.

As emphasized by many financial experts, including those mentioned in “The Intelligent Investor” by Benjamin Graham (2003), careful planning and consistent monitoring of your passive income sources can lead to greater financial freedom and control over your time.

This step-by-step approach allows you to learn and adapt, maximizing the potential benefits of passive income without overextending your resources.

How Passive Income Works

Sources of Passive Income

Passive income can stem from various sources, such as rental properties, investments in stocks or bonds, a wide of array of apps, and royalties from intellectual properties like books or patents. Each source has its unique characteristics, risks, rewards, and requirements.

While some sources, like savings accounts interest, are readily accessible, others may need significant financial investment or specialized knowledge, like creating a successful blog that earns ad revenue.

Automation and Minimal Active Involvement

Passive income often involves an automated process where money is earned with minimal active involvement. This includes setting up businesses that run themselves or investing in dividend-paying stocks that provide regular income.

Though these may require substantial initial setup, the ongoing maintenance is often minimal. But it’s worth noting that these ventures must be monitored and sometimes adjusted to ensure continued success.

READ MORE: How to Make $1,000 Per Month in Dividends

Tax Considerations

Tax implications for passive income differ from those for active income. Passive income may qualify for different tax rates or deductions, depending on jurisdiction and the type of income. For instance, rental income may be subject to specific property tax rules.

Understanding these rules or consulting a tax professional is vital to maximizing after-tax returns and compliance with tax laws. You can read more about here about how passive income is taxed.

Active vs Passive Income

Understanding the difference between active and passive income is essential for anyone looking to diversify their income streams and work towards financial stability or even independence.

What is Active Income?

Active income refers to earnings that require consistent and direct effort. This includes wages from a job, salaries, hourly payments, commissions, and tips. Essentially, active income requires trading time for money.

This type of income is what most people rely on to pay bills, purchase necessities, and maintain their current lifestyle. The major limitation of active income is its direct correlation to time; you can only work a certain number of hours in a day, thus capping your earning potential.

Passive Income Contrasted to Active Income

Contrastingly, passive income is earned with little to no daily effort to maintain, after the initial setup or investment. It includes revenue from rental properties, dividends, royalties, or even a business that doesn’t require daily involvement.

Comparison and Significance

The main distinction between active and passive income lies in the involvement and time required to generate revenue. While active income necessitates ongoing work, passive income aims to create sustainable income streams that flow regardless of daily activities.

Active income offers stability but often lacks scalability. Passive income, though requiring initial effort and possibly capital, offers the potential for long-term growth and diversification.

By combining both active and passive income streams, individuals can create a more resilient and flexible financial portfolio, allowing for the pursuit of broader life goals and interests, such as early retirement, travel, or investment in hobbies and personal development. The insights from Kiyosaki (2017) in “Rich Dad Poor Dad” emphasize this balanced approach to building wealth and achieving financial freedom.

The inclusion of both active and passive income in one’s financial strategy offers a multifaceted approach to wealth building. It’s an essential concept for anyone aiming to enhance financial security, diversify income, or explore new financial opportunities.

Benefits/Advantages/Pros of Passive Income

Financial Independence

Financial independence means having enough income to cover living expenses without needing to actively work. Passive income is often vital in this quest, allowing people to live comfortably without a regular paycheck. It offers an escape from the traditional work routine, opening doors to new opportunities, hobbies, or even early retirement.

“If you don’t find a way to make money while you sleep, you will work until you die.”

Warren Buffett

Flexibility and Freedom

The freedom granted by passive income extends to various life aspects. Whether it’s spending more time with family, traveling, or engaging in hobbies, the financial flexibility offered by passive income can significantly enhance life quality. It also provides an opportunity for strategic investments, exploring new ventures without the financial strain that might come without this income cushion.

Diversification of Income Streams

Having multiple income streams reduces the risk of financial hardship if one source diminishes or fails. By diversifying across various passive income avenues, financial stability is often enhanced.

Whether it’s investment in different market sectors, rental properties across various locations, or a mix of bonds and stocks, diversification is a fundamental risk management strategy in financial planning.

Potential Long-Term Growth

Some passive income sources offer the potential for substantial long-term growth. Investments like stocks may appreciate over time, generating not only regular income but also an increase in underlying asset value. This growth potential can substantially contribute to financial goals, whether saving for children’s education, building retirement funds, or other long-term planning.

Drawbacks/Disadvantages/Challenges/Limitations/Cons of Passive Income

Potential Risk and Volatility

The potential risks and volatility in passive income sources must not be overlooked. Market fluctuations can significantly impact investment returns, while real estate investments can be influenced by economic conditions and property market dynamics. Careful risk assessment and strategic planning are vital to mitigate these risks and ensure consistent income streams.

High Initial Investments or Skills Required

Some passive income streams necessitate significant initial investments or specific skills. Purchasing real estate, developing software, or creating a successful YouTube channel, for example, may require substantial money, time, and expertise.

These barriers must be considered and planned for, as they can deter or delay the successful implementation of a passive income strategy.

Regulatory and Compliance Challenges

Different passive income streams come with varying regulatory and legal considerations. Landlords must adhere to housing regulations, while stock investments may involve understanding complex financial laws. Failing to comply with these regulations can lead to legal troubles or financial losses. Professional guidance may often be required to navigate these complexities.

Maintenance Requirements

While often touted as ‘set and forget,’ passive income streams usually require ongoing attention. Whether it’s maintaining a rental property, adjusting an investment portfolio, or updating a mobile app, these tasks, though generally minor, are essential.

This continuous oversight ensures that passive income sources remain lucrative and aligned with financial goals.

Building a Passive Income Portfolio

Choosing the Right Passive Income Streams

Identifying the right mix of passive income sources is a tailored process that considers individual risk tolerance, financial goals, and personal preferences. Whether it’s the stability of government bonds or the potential high returns of startup investments, these choices should reflect the individual’s unique circumstances. Proper research, planning, and professional advice can ensure a balanced portfolio that serves both current needs and future aspirations.

In Vanguard’s Four principles for successful investing, they stress:

The best way to work toward an investment goal is to start by defining it clearly, take a level-headed look at the means of getting there, and then create a detailed, specific plan. Being realistic is essential to this process: Investors need to recognize their constraints and understand the level of risk they are able to accept.

Vanguard

Strategies and Planning

Creating a successful passive income portfolio isn’t just about choosing the right investments; it requires a well-thought-out strategy and continuous planning. Factors to consider include risk diversification, liquidity needs, time horizons, and long-term goals. Regularly reassessing and adjusting this strategy ensures that it stays aligned with evolving needs and market conditions, safeguarding the financial future.

Monitoring and Adjustments

Regular monitoring and necessary adjustments are key to maintaining a robust passive income portfolio. The landscape can change due to market conditions, new laws, or personal circumstances. Regular assessments and prompt adjustments ensure that the strategy remains relevant, meeting its objectives while maximizing potential returns.

The exploration of passive income is not a simple undertaking but rather a multifaceted approach to building a sustainable financial future. The understanding of various sources, the recognition of benefits, and the consideration of potential drawbacks are essential components in the effective management of passive income streams.

From aspiring to retire early to simply wanting a more flexible lifestyle, passive income provides opportunities and challenges worthy of thoughtful exploration and careful planning.

The Bottom Line – Passive Income Explained

Passive income might seem like a complex idea, but it’s really about making your money work for you instead of the other way around. From investments to side businesses, there are ways to create a steady stream of cash that doesn’t tie you down to a 9-to-5 grind. Mixing active income from your regular job with passive income can lead to a more relaxed and secure financial life.

It’s not a get-rich-quick scheme, but with some thought, effort, and patience, passive income can be a valuable part of your financial picture. Whether you’re aiming for early retirement or just some extra spending money, understanding passive income is a good first step.

The post What Is Passive Income? appeared first on Good Financial Cents®.