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Yahoo
6 hours ago
- Business
- Yahoo
Why Suze Orman and 2 Other Money Experts Think You Need a 12-Month Emergency Fund
For years, the personal finance rule of thumb has been to have an emergency fund replete with three to six months' worth of living expenses. This isn't a bad rule considering that it's savvy to keep your cash holdings low so that you can maximize investments, but often an emergency fund this size just isn't big enough. Find Out: Read Next: Some financial experts, including Suze Orman, Ramit Sethi and Elaine King of Family and Money Matters Institute, think you need a 12-month emergency fund. This may sound excessive, but consider the following reasons why, in 2025, this is a good amount to keep at the ready in a high-yield savings account (HYSA). Some industries are more volatile than others. The technology sector, for example, is shaping up to be increasingly unstable, with mass layoffs frequently sweeping the field. The automotive sector is also rocky, as is the travel sector. Competition for these jobs is getting fiercer as corporations cut costs. So, you may need a lot longer than three months to replace your job if you work in these fields. Explore More: If your family relies on you in full to keep them sheltered, clothed, fed and so on, you're all going to be in for an incredibly tough time should you lose even some of your income. An ample cushion in the form of a 12-month emergency fund could literally prevent you from falling into credit card debt as you work to get back on your feet. Every seasoned freelancer is familiar with those one or two clients who provide them a ton of work. Perhaps these clients have you on a monthly retainer, or maybe they pop up on a seasonal basis and flood you with the bulk of your annual income. And every seasoned freelancer also knows the impact of losing such a client. Nothing is forever, especially not in contract work. Freelancers don't get severances or access to Cobra health plans. They need a plush emergency fund in the likely event that their major payday falls through. When a recession strikes, all bets are off. Though the economy inevitably rebounds, there's no crystal ball that tells us when it will. There is always massive job loss and consequently weakened consumer spending which only leads to more job loss as companies struggle to stay afloat. If you're one of the many employment casualties, you'll want a plentiful emergency fund to ride out the storm. On average, people find a new job after five months of searching — but keep in mind, that's the average. There are many horror stories featuring people with strong resumes who've spent a year-plus job hunting after a layoff. More From GOBankingRates 10 Unreliable SUVs To Stay Away From Buying 4 Affordable Car Brands You Won't Regret Buying in 2025 This article originally appeared on Why Suze Orman and 2 Other Money Experts Think You Need a 12-Month Emergency Fund Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
a day ago
- Business
- Yahoo
Is Dave Ramsey's Home Buying Advice Realistic For The Average Homeowner?
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Dave Ramsey is known for his no-nonsense approach to personal finance, including bold guidelines about how — and when — to buy a home. His long-standing advice is clear: never take out more than a 15-year mortgage, and never let your mortgage payment exceed 25% of your take-home pay. But as housing prices and interest rates climb, can the average person still afford a home if they follow Ramsey's rules? Don't Miss: Hasbro, MGM, and Skechers trust this AI marketing firm — Inspired by Uber and Airbnb – Deloitte's fastest-growing software company is transforming 7 billion smartphones into income-generating assets – TikTok user @simemedia recently laid out what Ramsey's home-buying rule looks like in today's market. Using national housing averages and ideal borrowing scenarios, he walked viewers through the numbers — and the outcome raised eyebrows. As @simemedia explains, the average U.S. home now costs around $350,000. A 15-year mortgage on that amount, assuming excellent credit – a 780+ score – would come out to just under $3,000 per month — before factoring in insurance, utilities, or maintenance. Now factor in Ramsey's second rule: the mortgage payment should be no more than 25% of take-home pay. Take-home pay is what's left after taxes, so to comfortably afford a $3,000 mortgage by Ramsey's standard, a buyer would need to take home $12,000 per month. That equates to an annual gross income of about $190,000 — putting the buyer in the top 6% of earners nationwide. Trending: This Jeff Bezos-backed startup will allow you to . To test the advice further, @simemedia ran the same scenario using Mississippi, the state with the lowest average home prices — around $180,000. That would bring the 15-year monthly mortgage payment down to roughly $1,600. Following the 25% rule, a buyer would need to take home $6,400 a month, or earn about $95,000 per year before taxes. That's still well above the national median household income of $80,610, according to the Census Bureau. In other words, even in the cheapest state in the U.S., the average household would fall short of affording a home under Ramsey's advice is rooted in avoiding financial risk. A 15-year loan saves thousands in interest compared to a 30-year one, and the 25% rule ensures homeowners don't stretch their budgets too thin. But critics like @simemedia argue that the rules, while ideal, are increasingly out of reach for many buyers, especially younger or first-time homeowners. Some financial experts recommend treating Ramsey's rules as goals rather than rigid requirements. Choosing a longer-term mortgage or targeting a more affordable home could make homeownership more achievable, while still maintaining reasonable financial safety. Ramsey's advice aims to help people build wealth responsibly, but strict adherence might not be realistic for the average homeowner in today's economy. As always, the best approach is one that reflects your personal financial situation, and if needed, includes input from a financial advisor. Read Next: Deloitte's fastest-growing software company partners with Amazon, Walmart & Target – , which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum. Image: Shutterstock Send To MSN: 0 This article Is Dave Ramsey's Home Buying Advice Realistic For The Average Homeowner? originally appeared on Fehler beim Abrufen der Daten Melden Sie sich an, um Ihr Portfolio aufzurufen. Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten
CTV News
2 days ago
- Business
- CTV News
Build an emergency fund
Ottawa Watch We give you the top 5 things you can do now to set up an emergency fund.
CNET
5 days ago
- Business
- CNET
PocketGuard Review for 2025
If you're looking for a budgeting app, there's a good chance you've come across PocketGuard in your search. It's been around since 2015, and it's gained plenty of fans over the years, with high praise from Android and iPhone users alike. Like Rocket Money, PocketGuard is a great fit for the average budgeter, with a range of features, ease of use and an affordable price. Where it stands out the most is with its debt planning feature, which can help you create a strategy to pay off your outstanding balances. Is PocketGuard the right budgeting tool for you? We took it for a test drive to help you decide. 8.8 PocketGuard Buy at PocketGuard Like Debt payoff planning Debt payoff planning Added security layer Added security layer Bill negotiation Bill negotiation Personal finance education Don't like Limited trial period Limited trial period No subscription cancellation No subscription cancellation Unclear data privacy and marketing policies How does PocketGuard work? David McMillin/CNET PocketGuard works like most budgeting apps: You can link your checking, savings, investment and credit card accounts using Plaid and Finicity to import your data in just a few seconds, without sharing your account numbers or sensitive information. PocketGuard automatically sorts some of your transactions into spending categories, but I had to sort many of mine manually. That's not necessarily a bad thing, though. Taking extra time to think about where your cash is going can help you manage your money better. You can also label your recurring charges, set up savings goals and do all the usual budgeting actions that come with most other budgeting apps. The most valuable feature of PocketGuard is its debt payoff tool, which can help you create a payment plan, calculate how much interest you'll pay and track your progress. I was disappointed that the app didn't encourage me to see if I could set aside even more to pay down my credit card balance. If you want an app that can challenge you to be a better budgeter -- and hold you accountable to your goals -- you might consider Cleo. What we like David McMillin/CNET Debt payoff planning: Debt can be overwhelming, and PocketGuard can help you create a strategy to tackle yours. Many budgeting apps don't offer this feature. Debt can be overwhelming, and PocketGuard can help you create a strategy to tackle yours. Many budgeting apps don't offer this feature. Extra security layer: PocketGuard requires a unique PIN to access your account, and it also offers facial and fingerprint recognition to sign in. This can give you peace of mind that your financial information won't slip into the wrong hands -- even if you lose your phone. PocketGuard requires a unique PIN to access your account, and it also offers facial and fingerprint recognition to sign in. This can give you peace of mind that your financial information won't slip into the wrong hands -- even if you lose your phone. Bill negotiation services: PocketGuard will automatically try to score some savings on recurring bills such as your cable, home security and mobile phone. If the company successfully lowers your bill, it'll take 40% of the savings. (Rocket Money also offers this service and charges 30% to 60% of your first year's savings.) PocketGuard will automatically try to score some savings on recurring bills such as your cable, home security and mobile phone. If the company successfully lowers your bill, it'll take 40% of the savings. (Rocket Money also offers this service and charges 30% to 60% of your first year's savings.) Personal finance education: The app includes a free, 20-minute, self-guided tutorial that covers different approaches to budgeting, debt management, goal setting and more. While the information is pretty basic, it's helpful for anyone in the early stages of creating a money plan. What we didn't like Limited trial period: PocketGuard's free trial period is only seven days, which isn't a ton time to see if the app fits your needs. I recommend opting for the monthly billing option initially if you decide to pay for the app. While it's more expensive at $12.99 per month, you don't want to lock yourself into the $74.99 annual cost without being confident you'll actually use the app. PocketGuard has a free version, but it's pretty barebones. PocketGuard's free trial period is only seven days, which isn't a ton time to see if the app fits your needs. I recommend opting for the monthly billing option initially if you decide to pay for the app. While it's more expensive at $12.99 per month, you don't want to lock yourself into the $74.99 annual cost without being confident you'll actually use the app. PocketGuard has a free version, but it's pretty barebones. No subscription cancellation service: The app can show you your recurring subscriptions and provide instructions to cancel them, but you'll need to do the legwork. Rocket Money, on the other hand, can identify and cancel your subscriptions for you. The app can show you your recurring subscriptions and provide instructions to cancel them, but you'll need to do the legwork. Rocket Money, on the other hand, can identify and cancel your subscriptions for you. Unclear data privacy and marketing policies: PocketGuard states, 'We don't sell your data, we don't show ads and we earn our money exclusively by selling subscriptions and better service.' However, the company's privacy policy includes disclaimers about using your financial information to generate offers for products and services from its marketing partners. When I started using the app, I had to ask it not to track my activity across other websites. Is PocketGuard safe? PocketGuard checks all the boxes when it comes to keeping your data safe. The company uses 256-bit SSL encryption, and it goes a step beyond many other budgeting apps by asking you to create a unique PIN for account access. You can also enable facial and fingerprint recognition for an added layer of protection. Who is PocketGuard best suited for? PocketGuard is a solid pick if you're juggling multiple credit card balances and want an easy way to create a payment plan and monitor your progress. Alternatives to the PocketGuard budgeting app If you're considering PocketGuard, make sure you also check out Rocket Money, which was CNET Editors' Choice pick for the best overall budgeting app in 2024. Rocket Money is equally easy to use, has a lower price point and provides all the basic budgeting features you need. It offers a free subscription cancellation service and credit score monitoring, but it lacks PocketGuard's debt payoff tool. Check out our best budgeting apps roundup for other options worth exploring. FAQ How much does PocketGuard cost? PocketGuard has two pricing tiers, one for $12.99 per month or another for $74.99 per year. Is PocketGuard worth paying for? If you want help creating a plan to get out of debt, PocketGuard can be well worth the cost. According to the company's statistics, it's helped users pay off more than $90 million in debt. And if you have a maze of bills and subscriptions, the app can help you negotiate some of those costs or show you how to cancel the service altogether. Is PocketGuard or Rocket Money better? It depends on what you need from a budgeting app. Both apps have similar features and pricing models, although Rocket Money is a bit cheaper. However, PocketGuard has the edge for users who want help paying off debt.
Times of Oman
5 days ago
- Business
- Times of Oman
What role does your money play in the climate crisis?
Paris: Personal finance is a climate blind spot for many — lagging behind decisions on things like diet, travel or shopping when it comes to individual action. Yet when it comes to lowering a personal carbon footprint, moving to a sustainable pension provider can be 20 times more effective than the combined impact of giving up flying, going vegetarian or switching energy provider, according to analysis from UK campaign group Make My Money Matter. What role do banks have in funding fossil fuels? The world's 60 biggest banks are estimated to have committed $705 billion (€619 billion) to the fossil fuel industry in 2023, and $6.9 trillion since the Paris Agreement was reached in 2015. Much of this is funding expansion plans that fly in the face of science's unequivocal climate warnings. "We all have pots of money that are contributing to this in various ways without our knowledge a lot of the time," said Adam McGibbon, campaign strategist at US-based research and advocacy organisation Oil Change International, adding that it could be in the form of current accounts, pensions or insurance policies that are reinvested into the fossil fuel industry. Yet experts note the difficulty in precisely quantifying personal finance's contribution to fossil fuel funding due to complex financial systems and individual circumstances. This is largely because it is through the corporate rather than retail side of a bank's operations — where individual customers' money is held — that they usually lend money or underwrite bonds for companies developing fossil fuel projects, explained Quentin Aubineau, policy analyst at BankTrack, an international NGO documenting the financial activities of commercial banks. However, McGibbon added that banks are still using our money to grow their business, create more revenue and attract investors. He said our savings might at the very least be "used to inflate the balance sheet of a bank, which will then allow them to service corporate clients" with links to fossil fuels. Is there a link between our cash and rising global temperatures? When it comes to investments, some personal finances go directly into the fossil fuel industry via stocks or bonds, said Carmen Nuzzo, executive director of the Transition Pathway Initiative Centre in the UK, which researches progress made by the financial and corporate world to low-carbon economy. "This includes investment in oil and gas companies, which have been very attractive and profitable in recent years ... as well as investment in other companies that rely heavily on fossil fuel for their production or service provision, such as steel or aviation," said Nuzzo. Many people will also be funding fossil fuels through savings going into pension funds that invest in "brown" companies — those within the highest greenhouse gas and carbon-emitting industries. Pensions are usually held and controlled by either the state, employers or private companies. "You pay into a pension pot, that money is invested on your behalf and some of that may end up being invested in companies that make sure that your retirement will be one where you live in an unstable, difficult world," said McGibbon. Recent studies have estimated that in a world of 4 degrees Celsius (7.2 degrees Fahrenheit) warming, an average person will be 40% poorer and that pension fund returns in the US and Canada could fall up to 50% by 2040, due to the exposure of assets to extreme climate events. Pension funds are among the world's largest investors in fossil fuels, with an estimated $46 trillion plowed into the industry and holding 30% of its shares, according to Climate Safe Pensions, a divestment campaign based in the US and Canada. They were also found to be among the leading funders of fossil fuel expansion across Africa. In 2023, the German investigative platform Correctiv revealed that 10 out of 16 German federal states invested pension funds in fossil fuel activities. What are green finance alternatives? While green banks don't always have the most favorable conditions, among climate-conscious people there is a growing appetite for sustainable financial alternatives, said Katrin Ganswindt, a finance researcher at the German NGO Urgewald. Among the growing pool of green banks are those that pledge to stop lending to fossil fuel companies and invest in climate-friendly activities. Online tools such as have also emerged to help consumers compare the environmental credentials of different banks. But overcoming a lack of financial knowledge is still one of the key challenges, explained Nuzzo. "In the countries where most people have a pension, individuals do not keep track of where their pension assets are being invested .... or they might not review their options regularly." Things such as pensions that invest in the long-term are effective places to make a change, said Ganswindt. "Pension funds have a big effect because they invest large sums." Make My Money Matter estimated that the UK's pension industry could invest €1.2 trillion into renewable energy and climate solutions by 2035. The green pension landscape is, however, evolving. In the Netherlands, pension funds for civil servants and teachers as well as health care workers have divested from fossil fuel companies, and in the UK, large pension schemes are also now required to report their climate risks. What is 'green' and 'sustainable,' and what is 'greenlaundering'? Yet despite growing awareness and green finance options, there is still a lack of standards and regulation in this space, said Franziska Mager, senior researcher at Tax Justice Network, a UK advocacy group working against tax avoidance. "Even if you're banking with a 'green' bank, you might be surprised to find out where your money is invested — if you're able to find out, that is. Let alone what the big players define as sustainable," she said. A recent paper she co-authored on "greenlaundering" in the banking industry said the existence of opaque financial practices — including the use of secrecy jurisdictions, a type of tax haven — obscure the true scale of fossil fuel financing. When it comes to ETFs — a type of investment fund traded on the stock market — you have been able to say it is "green" and it can mean nothing," said Ganswindt. There has, however, been recent progress when it comes to transparency, she added, pointing to new EU guidelines that will regulate which companies are allowed into funds that are labeled green or sustainable. Ultimately, personal finances likely make up a small fraction of the enormous sums of funding fossil fuels — but that is not the point of actions like switching your bank to a greener provider, explained Ganswindt. It's about sending a message. "Certainly, there's some power as customers, but we have way more power as citizens," said McGibbon. "So great to move to a greener bank, great to move to a greener pension scheme. But ultimately, we could have much more power as citizens, changing the way we vote, demanding the politicians regulate the financial sector."
