The Importance of Budgeting, No Matter Your Age

No matter where you are in life, you can benefit from an evaluation of your finances. Even if you’re financially stable, there’s a definite benefit in setting up some type of budget. You never know when your circumstances may change or if you might suddenly want to use extra money toward an emergency or to splurge on something. Budgeting helps you keep track of how you spend your money and make sure you aren’t wasting it on anything unnecessary. With budgeting, you’ll gain greater control over your life and be able to prioritize your spending.

You could lose your job

I’ll start with the worst case scenario; you could be financially stable and not have to worry about money, but then you (or a spouse) could suddenly lose your job and realize that you have to make do with a lot less money. With budgeting, you understand how to live within your means and you’ve had time to save up extra money. Avoiding overspending helps discipline you, especially if money is scarce at times.

You can save up for big purchases

The better you budget, the more money you’ll have to save up (if you have expendable income that’s not going toward living expenses or debt). Avoiding overspending allows you to save money for larger purchases, like a vacation, a house, or even simply your future. After creating a budget, if you find that you have extra money, consider putting as much as you can toward a retirement fund if you don’t already have one.

You can quickly pay off debt

As you cut out overspending, you can put extra money toward debt. While you should also regularly be saving money, it’s almost equally important to pay off your debt as fast as possible. If you find that you have extra money, consider paying more on your debt each month. You’ll save interest and also have that many less payments to worry about.

You figure out what’s most important

When you start examining your budget and decide where to cut costs, you begin to realize what’s important and where you can avoid spending money. Maybe you have monthly subscriptions for services or products you rarely use. Maybe there’s another service you could use that would cost less. You might spend considerably more than you realize. It’s important to take an honest look at your spending habits and evaluate what matters most. This step allows you to stop wasting money and actually put it toward what matters.

You have more control

Maybe it doesn’t feel like it or maybe you feel overwhelmed by monetary concerns, but once you start budgeting, you’ll feel like you have more control over your life. Being financially stable frees you up to make decisions instead of always feeling like you have to worry about bills or when you’ll get your next paycheck. Gaining control over your finances leaves you feeling much more confident and reassured.

Easy Ways To Save A Lot Of Cash

Do you feel like you are always strapped for cash? It seems that a lot of people feel that very same way in today's world. There are just so many bills to keep up with and ways to spend our hard-earned money that it becomes easy to fall a little short on extra cash. Everyone wants to know what some simple ways to save more money are so that they can bank some extra cash.

Check Out Coupon Sites

The Internet provides plenty of ways to spend your money, but from time to time it also produces ways to save some of that cash as well. Coupon websites are plentiful and often feature some of your very favorite products at a discount. If they have a coupon for something that you already plan to purchase anyway, why not take advantage of that opportunity?

Even if you do not go directly to a coupon website, at least check to see if there are any coupons for what you plan to buy in that moment. Places like pizza restaurants and the like frequently have coupons available for the taking for those who are ordering delivery.

File Your Tax Return

The vast majority of us are required to file a tax return every year by law. For some reason some people like to drag it out. This might make sense if you are one of the unfortunate ones who has to pay money into the government. However, if you someone who is expecting a tax refund, why would you wait even another minute to file? As soon as the new year rolls around you can file your taxes and start having that refund processed. The sooner you file, the sooner that money can get to you.

Buy In Bulk

A lot of retail and grocery stores count on you buying items in just the quantity that you need at that very moment. If you indulge them in doing this, then they are the ones who really benefit. Stores can mark up smaller quantity items a lot more than what they would sell the same item to you for in bulk.

Bulk purchases means fewer trips to the store (less temptations to buy more things!), and you get a better price per unit when you shop this way. Check out the price comparisons by either doing the math on the per unit price for yourself, or check the price tags to see this broken down for you on many items in many stores. The difference can be truly astounding.

How do you Value a Sports Team?

I’ve always found it interesting how economists assign value to sports teams. What dictates one sports team being worth $4 billion while another is worth $2 billion?  You’d think it would be the abilities of the players, right? How many games they’ve won? Feats they’ve accomplished? While I’m interested in the economy of sports, I take a bit of nuanced view on the subject because it find it pretty arbitrary how an economist decides how much a team is worth, to an extend sealing the team’s fate. Because there is some kind of system they follow though, and I’m interested in both finance and sports, I thought I’d try to shed some light on the subject.

Let’s take a look at the most valuable sports team from 2016: the Dallas Cowboys. Now wait a minute, you may be thinking. The Broncos won the Super Bowl in 2016, and the Patriots in 2015 and 2017...what makes the Dallas Cowboys so valuable? At $4 billion, the Dallas Cowboys are the world’s most valuable sports team, even though they haven’t won an NFL championship in 20 years. Instead, we should consider the team’s $1.2 billion home stadium built in 2009, which they sold the naming rights to AT&T in 2013.

According to financial firm Mercer Capital, “Sports business mandates constitute an amalgam of traditional valuation approaches applied to a specialized industry niche possessing its own distinct value drivers and considerations.” Various factors, both internal and external value drivers, play into the value of a sports team. For the sake of time and space, I’ll explain it in simple terms. A sports franchise’s value is often determined from its future benefits, and sentimental value often plays a larger role in determining a team’s value than factors that would seem to be of more importance, such as the win-loss record of the team and the skills of individual players.

The valuation of sports teams is complicated and has its own set of rules, with there often being significant differences between fair market value and price. Sometimes a team’s worth is influenced by a wealthy investor who has some kind of sentimental connection to the team, and in that case the team’s ability has nothing to do with their value. A sports team’s value can also be incredibly difficult to define, because it is derived mostly from future benefits looking at projected factors such as the management team, trademarks, brands and logos, customer “fan base” relations, player relations and contracts, customer contracts, broadcasting contracts, arena ownership and lease agreements, and local demographics.

In short, the economy of sports is complicated and often arbitrary. It follows its own set of rules. From the words of economists at Mercer Capital, “...sports properties encompass a highly specialized segment of our profession that is subject to its own distinct challenges.”

Originally published on nicholasfainlight.net

3 Awesome Finance Podcasts

If you’re going to be in finance, you’re going to have to read. A lot. As a student, I am inundated in fundamental texts on a daily basis, but textbooks set aside, there is just a lot of reading that goes into the job—pouring over reports, staring at data to identify trends, drafting up proposals and strategies—the works. That’s why I appreciate being able to approach learning from a different tac. The tac of podcasts. Here are four of my current favorite finance podcasts. If you have recommendations others than the one’s I’ve listed, I’d love to hear your thoughts below!

Planet Money

If you’re going to write a blog about finance podcasts to listen to, you would be remiss to not include Planet Money. It’s an NPR production, so you can bet that it dives in deep, while also still being approachable.

For the full blog, go to NicholasFainlight.net