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While the idea of financial freedom can mean different things to different people, a recent report by Bank of America pinpointed the top three areas many women say indicate financial independence.
To get the results, more than 3,500 women ages 22 and up were surveyed about their thoughts on financial confidence, especially when it comes to investing.
Here’s a look at the top three indicators of financial independence, according to survey respondents, plus a few easy tips to help you meet those goals.
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For starters, 47% of respondents felt that being debt-free was a huge indicator of financial independence.
While some forms of debt — such as a mortgage or student loan — can buy you the flexibility to be able to afford an opportunity or acquire an asset, for many, the idea of actually owing money is enough to create a feeling of dread. A great deal of people are emotionally uncomfortable with debt, and those feelings of discomfort are reason enough to prioritize making their balances disappear.
Paying down debt also allows you a little more flexibility in the face of tough circumstances. For example, if your credit card limit was $5,000 and you were carrying a $4,500 balance, you would only have $500 left to float the cost of an unexpected car repair or roof leak if you didn’t have an emergency fund to pull from. If, however, you were to pay off that balance, you would still have more room to cover a necessary expense if your emergency fund won’t suffice.
There are many strategies out there when it comes to paying down debt. The popular debt snowball method involves eliminating the smallest debt balance first while paying just the minimum on your other debts. The idea is to work your way up to the largest balance until you’re completely debt-free.
Another tactic, the debt avalanche method, involves eliminating your highest interest debt first while making minimum payments on the others, and working your way down to the debt with the lowest interest rate. This particular method will help you save the most on interest charges.
Debt consolidation is another strategy that can potentially help you save on interest charges while also organizing your debt into just one monthly payment. With this option, you’re essentially using a debt consolidation loan, such as the Marcus by Goldman Sachs Personal Loan or the LightStream Personal Loan, to have your funds sent to each of your creditors to pay off those balances. After that point, you’re just left paying back the debt consolidation loan you took out.
Another alternative is to use a balance transfer card with a 0% introductory APR period, such as the Citi® Diamond Preferred® Card which has a 0% intro APR on balance transfers for 21 months from date of first transfer, (15.24% – 25.24% variable thereafter; all transfers must be completed in the first 4 months) or the Chase Freedom Unlimited®, which has a 0% intro APR for 15 months from account opening on balance transfers, then a variable APR of 15.74% – 24.49%, to transfer a credit card balance with a high interest rate onto a new credit card that charges no interest fees for a limited time. The idea is the 0% introductory APR period will buy you enough time to have your entire monthly payment go toward the balance and not the interest, which should help you pay down your debt faster.
Emergencies are bound to pop up, which is why 39% of women who responded to the survey said being able to weather an unexpected expense was a sign of financial independence.
Having an emergency fund — a lump sum of cash that you can access in the event of a dire need — can help to offset these unforeseen expenses. For example, you could use money stashed in an emergency fund to replace a damaged car part, fix a leaky roof or pay a medical bill you weren’t planning on.
Emergency funds can also help you make ends meet in the event you’re laid off from a job with little to no notice. While unemployment benefits might help you to afford some of your daily expenses, those funds are generally not enough to cover your entire cost of living.
It’s a good idea to keep your emergency fund in a relatively accessible account, such as Marcus by Goldman Sachs High Yield Online Savings or an Ally Online Savings Account. With these high-yield savings accounts, you’ll be paid interest on a monthly basis just for keeping a balance, helping to grow your emergency fund just a little quicker.
Experts typically recommend that you have an emergency fund with about three to six months worth of living expenses, though the amount you should save is dependent on your individual situation and how much your monthly expenses usually end up being.
According to the survey, 34% of respondents said that not having to ask their families for financial assistance would make them feel more financially independent.
The rising cost of living, student loan debt and stagnating wages have made it tough for many people to keep up with everyday expenses — sometimes, they have no choice but to turn to family to help bridge the gap between what they need and what they can actually afford.
While it’s usually recommended that you simply find ways to cut back on spending to free up the cash for other expenses, with a highly inflationary environment like the one we’re seeing right now, there may not be much room for individuals to cut back on spending more than they already are.
If you do find yourself hitting a wall with your cash flow, it might be time to consider asking for a raise at work or even switching to a higher paying job if you can. If you’d rather stay with your current company, try taking on a side hustle — preferably one that you actually find enjoyable — to help make ends meet.
If you choose to go the side hustle route, think about your skills and personal interests and try to find a side gig that works best for you. For example, if you have a knack for creating customized digital illustrations, think about selling them through a website such as Etsy.
While taking on extra work can be tiring, there are a few things you can try to mitigate burnout. For one, avoid doing side gigs that force you to use the same skills you’re using for your day job. If you already work full-time as a writer, for instance, taking on an extra side hustle as a freelance writer can make it feel like complete writing overload. Consider using another skill you already have that you can monetize so you’re not stuck doing too much of the same thing each day.
You should also think about how much time you realistically have to dedicate to a side hustle each week. If you can only spare 15 hours a week, you’ll get stressed and burn out very quickly if you’re pursuing a a side gig that’s going to feel like another full-time job.
Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
Ford CEO says 65% of U.S. dealers agree to sell EVs
Ford F-150 Lightning trucks manufactured at the Rouge Electric Vehicle Center in Dearborn Michigan.
Courtesy: Ford Motor Co.
DETROIT – About 65% of Ford Motor’s dealers have agreed to sell electric vehicles as the company invests billions to expand production and sales of the battery-powered cars and trucks, CEO Jim Farley said Monday.
About 1,920 of Ford’s nearly 3,000 dealers in the U.S. agreed to sell EVs, according to Farley. He said roughly 80% of those dealers opted for the higher level of investment for EVs.
Ford offered its dealers the option to become “EV-certified” under one of two programs — with expected investments of $500,000 or $1.2 million. Dealers in the higher tier, which carries upfront costs of $900,000, receive “elite” certification and be allocated more EVs.
Ford, unlike crosstown rival General Motors, is allowing dealers to opt out of selling EVs and continue to sell the company’s cars. GM has offered buyouts to Buick and Cadillac dealers that don’t want to invest to sell EVs.
Dealers who decided not to invest in EVs may do so when Ford reopens the certification process in 2027.
“We think that the EV adoption in the U.S. will take time, so we wanted to give dealers a chance to come back,” Farley said during an Automotive News conference.
Ford’s plans to sell EVs have been a point of contention since the company split off its all-electric vehicle business earlier this year into a separate division known as Model e. Farley said the automaker and its dealers needed to lower costs, increase profits and deliver better, more consistent customer sales experiences.
Farley on Monday also reiterated that a direct-sales model is estimated to be thousands of dollars cheaper for the automaker than the auto industry’s traditional franchised system.
Wall Street analysts have largely viewed direct-to-consumer sales as a benefit to optimize profit. However, there have been growing pains for Tesla, which uses the sales model, when it comes to servicing its vehicles.
Ford’s current lineup of all-electric vehicles includes the Ford F-150 Lightning pickup, Mustang Mach-E crossover and e-Transit van. The automaker is expected to release a litany of other EVs globally under a plan to invest tens of billion of dollars in the technologies by 2026.
Tim Draper predicts bitcoin will reach $250,000 despite FTX collapse
Tim Draper, founder of Draper Associates, onstage at the Web Summit 2022 tech conference.
Ben McShane | Sportsfile via Getty Images
Venture capitalist Tim Draper thinks bitcoin will hit $250,000 a coin by the middle of 2023, even after a bruising year for the cryptocurrency marked by industry failures and sinking prices.
Draper previously predicted that bitcoin would top $250,000 by the end of 2022, but in early November, at the Web Summit tech conference in Lisbon, he said it would take until June 2023 for this to materialize.
He reaffirmed this position Saturday when asked how he felt about his price call following the collapse of FTX.
“I have extended my prediction by six months. $250k is still my number,” Draper told CNBC via email.
Bitcoin would need to rally nearly 1,400% from its current price of around $17,000 for Draper’s prediction to come true. The cryptocurrency has plunged over 60% since the start of the year.
Digital currencies are in the doldrums as tighter monetary policy from the Fed and a chain reaction of bankruptcies at major industry firms including Terra, Celsius and FTX have put intense pressure on prices.
FTX’s demise has also worsened an already severe liquidity crisis in the industry. Crypto exchange Gemini and lender Genesis are among the firms said to be impacted by the fallout from FTX’s insolvency.
Last week, veteran investor Mark Mobius told CNBC that bitcoin could crash to $10,000 next year, a more than 40% plunge from current prices. The co-founder of Mobius Capital Partners correctly called the drop to $20,000 this year.
Nevertheless, Draper is convinced that bitcoin, the world’s largest cryptocurrency, is set to rise in the new year.
“I expect a flight to quality and decentralized crypto like bitcoin, and for some of the weaker coins to become relics,” he told CNBC.
In 2014, Draper purchased 29,656 bitcoins confiscated by U.S. Marshals from the Silk Road dark web marketplace for $18.7 million. That year, he predicted the price of bitcoin would go to $10,000 in three years. Bitcoin went on to climb close to $20,000 in 2017.
Some of Draper’s other bets have soured, however. He invested in Theranos, a health startup that falsely claimed it was able to detect diseases with a few drops of blood. Elizabeth Holmes, Theranos’ founder, has been sentenced to 11 years in prison for fraud.
Draper’s rationale for bitcoin’s breakout next year is that there remains a massive untapped demographic for bitcoin: women.
“My assumption is that, since women control 80% of retail spending and only 1 in 7 bitcoin wallets are currently held by women, the dam is about to break,” Draper said.
Crypto has long had a gender disparity problem. According to a survey conducted for CNBC and Acorns by Momentive, twice as many men as women invest in digital assets (16% of men vs. 7% of women).
“Retailers will save roughly 2% on every purchase made in bitcoin vs dollars,” Draper added. “Once retailers realize that that 2% can double their profits, bitcoin will be ubiquitous.”
Payment middlemen such as Visa and Mastercard currently charge fees as high as 2% each time credit cardholders use their card to pay for something. Bitcoin offers a way for people to bypass the middlemen.
However, using the digital coin for everyday spending is tough, since its price is very volatile and the coin is not widely accepted as currency.
“When people can buy their food, clothing and shelter all in bitcoin, they will have no use for centralized banking fiat dollars,” Draper said.
“Management of fiat is centralized and erratic. When a politician decides to spend $10 trillion, your dollars become worth about 82 cents. Then the Fed needs to raise rates to make up for the spend, and those arbitrary centralized decisions create an inconsistent economy,” he added. Fiat currencies derive their worth from their issuing government, unlike cryptocurrencies.
Meanwhile, the next so-called bitcoin halving — which cuts the bitcoin rewards to bitcoin miners — in 2024 will also boost the cryptocurrency, according to Draper, as it chokes the supply over time. The total number of bitcoins that will ever be mined is capped at 21 million.
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