How the Sharing Economy Is Changing Personal Finance

FinancesSpending

Disruption is such a cliche these days, especially when discussing the explosive nature of Silicon Valley. That ubiquity largely comes from companies that inhabit the sharing economy. The sharing economy runs on the philosophy of, “Why pay through the nose when you can rent it more cheaply from a stranger online?” This concept is a truly disruptive idea that has only come about in the past few years.

AirBnB, a marketplace platform that allows homeowners and renters to offer their living space as a hotel alternative, and Uber, a ride-sharing mobile app, are kings of the sharing economy while also being two of the most controversial companies around, due to their status as cheaper and more accessible alternatives to hotels and taxi cabs.

Users are flocking to these services because of these benefits. According to research from PricewaterhouseCoopers, 86 percent of adults agree that the sharing economy, in general, makes life more affordable, while 81 percent agree it is cheaper to share goods than to own them. By spending a portion of the cost to rent instead of paying the full price to own, consumers are able to save their money, which means they have more funds to spend elsewhere or to keep as savings for future use.

Katherine Krug was able to ditch her car, which she needed to commute to work, and utilize Uber and Lyft, one of Uber’s biggest competitors, which saved her thousands a year. Her total monthly car related expenses were $1,518, which included lease payments, repairs, parking and gas, among others. By getting rid of her car and subsequently using only Uber, Lyft and GetAround, Katherine cut her monthly spending to $572, which amounted to $11,352 in yearly savings. Now, she doesn’t have to worry about finding rare parking space in San Francisco and puts her savings towards traveling the world.

The sharing economy also lets people find an extra source of income to help pay their bills and even get through retirement. Frederic Larson, a 63 year old laid off photographer turned college lecturer, was able to supplement his smaller salary by putting his home up on AirBnB for others to stay in for $100 a night. Larson was able to pocket an extra $3,000 per month via AirBnB, which he lets him help pay for his San Francisco rent and his two kids’ college tuition.

Ultimately, both consumers looking to save and folks in need of extra income now have a vast, flexible number of options available to them due to the driving forces of the sharing economy.

6 Simple Ways to Lower Your Credit Card Debt

FinancesSavingSpending

6 Simple Ways to Lower Your Credit Card Debts

Jay Gies writes about managing money, budgeting, and finding ways to cut down expenses and credit card debt. Benjamin Franklin was famous for a great many things. One of the less frequently remembered is his fierce opposition to personal debt, which he believed represented a form of bondage. Today, the average American household just may understand his feelings. It’s far too easy to fall into credit card debt, and a lot harder to climb out of it – but, by no means is it impossible. Take up Mr. Franklin’s cause, and resolve to fight for your own independence today – from credit card debt.

1. Slash Personal Expenses Use convenience stores for gasoline only, and forget about newspapers, lottery tickets, snacks, and other impulse purchases. Commit to staying with your current e-reader, mobile device, laptop computer, and flat-screen TV until you’re completely debt free. Cross off clothing stores from the list, and cut your trips to restaurants in half, at the very least.

2. Cut Grocery Bills Get multiple copies of the Sunday paper and start clipping coupons. Then, put your smartphone to work and download apps like Yowza and Grocery IQ. However, don’t necessarily use every coupon you find – limit them to foods your household regularly consumes. Create a shopping list before you leave the house and stick to it. Stock up on your favorite foods when they’re on sale and take advantage of your grocer’s loyalty program if one is available.

3. Cut the Cable Cord Think you can’t get by without cable TV? Think again. Netflix and Hulu Plus offer tons of movies and TV shows at a significant discount to traditional cable and satellite packages – each costs $8 per month. Also, consider replacing your TV time with other activities, such as reading books or exercising. The potential savings is tremendous.

4. Drop Home Telephone Service Still have a home telephone? If you need a backup to your smartphone, consider MagicJack Plus instead. It’s a device you can buy for around $50 that plugs into your computer and acts as a landline telephone. The first six months of service are free; after that it’s only $29.95 per year. Match that up against your current landline and the savings are more than apparent.

5. Get An In-Home Energy Audit I got an email a while back from my provider offering an in-home energy audit. I didn’t really know what it was, but I decided to take the bait. A rep came to my home, free of charge, inspected it inside and out, and provided me with a written report of all the ways I could save on energy. I put many of the tips in place without spending a ton of cash, and my bills instantly went down by roughly 30%. Check to see if your company offers these audits, and get one on the books immediately.

6. Brown-Bag It to Work Eating lunch at restaurants on your work break adds up in a hurry. Even if you only spend $8 per meal, that’s roughly $200 each year. Wrap up last night’s leftovers in a flour tortilla, throw together some lunch meat sandwiches, or assemble a chef’s salad with some healthy dressing. You can save a ton of money with brown bag lunch ideas, all of which can be devoted to your credit card debts.

 

Once all of these tactics are in place, get yourself on a personal budget. Use Microsoft Excel, or a good old pen and paper to list out your expenses and income. Keep making cuts until you have a monthly surplus, and then send that amount in to your creditors. Watch your balances dry up, and celebrate when you’re debt-free. Achieving that independence is a major milestone – make sure you remember the struggles you faced getting there, so you don’t repeat the mistakes that landed you in debt in the first place.

 

What other ways do you know of to lower credit card debt?

How Much to Spend

1 in 4 Millennials Are Looking for Financial Advice on Google

FinancesLifestylePersonalitySpendingUncategorizedWellness

Moven Research Reveals the Frustration Behind Americans’ Money Woes

It’s no secret Americans today are facing a challenging financial landscape and paying close attention to their finances is a priority moving into 2015, but money anxiety and limited resources have them looking for help in all the wrong places. New research from Moven, the first spending app and debit card that provides real-time behavioral feedback and instant receipts to help customers spend smarter, shows that 1 in 6 (17%) Americans are actually turning to the Internet or Google for financial advice. That number is even higher among millennials (ages 18-34), with 1 in 4 (24%) reporting they would seek out advice via Google or the Internet.

Moven commissioned accredited research firm YouGov to study the financial behavior of a representative sample of 1,178 American adults. The findings indicate that money anxiety is causing Americans to actively seek out financial information, but they lack the tools and resources needed to truly be successful. Given the upcoming holiday shopping season its likely many Americans will overspend in the coming months and Moven’s research suggests most will be unprepared for the inevitable shock once it’s time to pay the bills.

“For most people, sticking to a budget is nearly impossible because monthly expenses never stay the same and unexpected expenses can easily throw consumers off track,” said Alex Sion, President of Moven. “In reality, budgets are an outdated way of managing expenses and consumers would be better served finding resources that help them understand how fast they spend and where they are spending. With real-time feedback they can focus more on changing their behavior instead of tediously updating a budget,” he added.

Additional key findings from the research include:

Financial Wellness a Concern, But Tools are Sorely Lacking

  • Financial wellness is a major concern moving into 2015: Half (50%) of Americans are planning to discuss financial wellness with their families in the next 12 months. This is significantly more than plan to discuss their physical health (46%), career/ the job market (34%), education (26%), or mental health (19%).
  • Americans don’t think they have what they need to be financially successful in 2015: 1 in 5 (19%) Americans think they would keep a financial resolution in 2015 if they had better resources to do it. 1 in 6 (18%) think that if they had real-time feedback on their spending habits it would help them keep a financial New Year’s resolution.

 Money Matters When It Comes to Love

  • Talking financial wellness could save a romantic relationship: 1 in 4 (26%) of Americans said financial wellness caused the most stress in their relationships. In fact, it was listed as the number one stressor in romantic relationships across all age groups.This was at least doublethe amount of Americans that listed physical health (12%), their career (11%), mental health (10%) and their geographical location (8%) as number one.

 Keeping Track is Too Much Work, Especially For Millennials

  • Americans don’t take budgets seriously: A third of Americans (33%) that keep a budget found it frustrating just because they couldn’t stick to it. More than a quarter (26%) were frustrated because it was too stressful or overwhelming. And, in today’s digital age, a surprising 1 in 3 (36%) Americans are keeping track of their monthly expenses on a piece of paper.
  • Americans would rather someone else do their work: Consumers know they can’t keep a budget on their own and are turning to other people or services to track their monthly expenses. Technology is becoming increasingly important in this regard, as almost a quarter of Americans (24%) are relying on services from their bank and 1 in 10 (10%) are relying on a personal finance app.
  • Men are lazier than women at keeping budgets: Men and women are both equally terrible budgeters, 23 percent don’t keep a budget at all. Men that do keep a budget are more likely to be frustrated with it because they are lazier (22%) than women (19%). Men (11%) that keep budgets are much more likely to keep track of their expenses with a personal finance app than women (8%). More than 1 in 3 women (42%) that keep budgets are actually doing so on a piece of paper, compared to just 31 percent of men.
  • Americans are obsessed with checking their bank accounts: Despite the fact they can’t stick to their budgets, Americans are trying to monitor their spending. Nearly a quarter (23%) of Americans check their spending accounts once a day or more. 1 in 4 women (24%) check their spending accounts once a day or more, compared to 1 in 5 (21%) of men.
  • There’s no cure for millennials’ financial anxiety: 1 in 11 (19%) millennials check their spending accounts multiple times a day, more than any other age group, but a third of millennials (31%) don’t even keep a budget at all. They are most likely to benefit as technology evolves and provides resources beyond just budgeting services for money conscious consumers, yet just 1 in 6 (18%) has turned to a personal finance app to track their monthly expenses.

“Financial health, like physical health, is about understanding your current situation, behaviors and trajectory so that you can make changes to improve your ability to live your life and survive unexpected shocks,” said Sion. “The upcoming holiday season is a great time to step back and take stock of your finances and reflect on whether your daily habits and behaviors are empowering or endangering your long term money goals which is much more effective than trying to stick to a budget that’s destined to fail,” he added

To sign up, visit Moven at www.moven.com or download the Moven app on Itunes or Google Play.

Connect with us on Twitter @getMoven.

Research Methodology
Moven commissioned accredited research agency YouGov Plc to poll the views of a representative sample of 1,178 U.S. adults. Fieldwork was undertaken between October 24-27, 2014. The figures have been weighted and are representative of all U.S. adults (aged 18+). The research was carried out online.

Spending: Turn that frown upside down!

Lifestyle

Warren_Quote_balancing money

There’s nothing as fulfilling as being able to do something that truly makes you happy.  Whether it’s buying the latest must have gadget or dining out at the newest trendy restaurant, we all have an indulgence that is guaranteed to put a big smile on our face.

But that smile can quickly become a frown when we get carried away.  Have you ever had to spend the rest of the month subsisting on Ramen and turning down invitations to social events because of an ill-timed indulgence or a purchase that just went a little too far?

It’s never a great feeling when we realize that our indulgence may have come at too high a cost.  Suddenly what should have been a blissful experience is now overwhelmed by guilt and regret.

Fortunately, many of us learn this painful lesson early on in our money experiences and devise ways to restrain ourselves.  Some of us hold off until the end of the month when all the important stuff has been paid off, while others give themselves a mental limit (no more than 5 song downloads a week!) to keep everything in check.

But all that may be in jeopardy now that ApplePay is on the horizon.

In fact, we at Moven believe that there will soon be a virtual pandemic of guilt-filled purchases.  When buying something becomes as easy as walking into a store, tapping your phone and walking out, it will be vastly easier for all of us to lose context and indulge too often.

It’s like when you first signed up for iTunes or Amazon one click and got that sticker shock when you saw your first month’s statement.  “I downloaded how many songs last month!!?  I bought how many items off my wish list?!!!”

Now don’t get us wrong.  We believe that everyday indulgences are what make life worth living and we certainly don’t advocate swearing off those things that truly make you happy.  But an indulgence can’t be fully enjoyed if it’s followed with guilt and regret.

That’s why we believe that the happiest people are those who indulge responsibly. We created our Spending Meter and Instant Receipt for just this reason.  By simply looking at your Moven app, you can easily figure out how much you can spend on what makes you happy.  And with the Instant Receipt you get with every purchase, you always know how much you’ve spent on Dining Out or Shopping or whatever it is that makes you smile.

Let us know your thoughts on whether ApplePay will make it easier or harder to indulge responsibly.  Send us a tweet @getMoven.  Or if you happen to know someone who would benefit from just a tiny bit of restraint, share this short video we put together.

wpid-97fe55fc1a06042a598695d70c835b2a

Moven Completes A Round

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Today while presenting at Wired Money in the UK, I proudly announced the closing of Moven’s Series A Investment round.

Led by SBT Venture Capital, this $8m raise included Route 66 Ventures, Standard Bank, and a few new angels. We are excited to welcome each of them to the Moven family and thank them for their investment in our mission to reinvent banking.

We would also like to thank Anthemis Group, our Seed round lead who also chose to participate in this raise. Their appetite for continued funding is a strong vote of confidence that all of us at Moven deeply appreciate.

Finally, we would like to recognize the Santerre Group, Kevin Plank from Under Armour, our NY Angel investors, and Jim Pallotta from Raptor Group for their stellar support throughout our Seed round and initial product development. We certainly would not have made it this far without them.

As many of you know, Moven has been in launch phase for less than a year, only recently exiting our Beta invite process in March of 2014 and opening up our service to the public. In that brief time Moven has become one of the most watched new brands in the global banking sector. Our work has been cited by Wired, AT Kearney, American Banker, Accenture, Forrester, EFMA and many others as a potential model for the future of banking.

While many “neo-banking” competitors’ initial product launches required $10m to $300m to execute, we are proud to say that the Moven team was able to launch what Techcrunch described as a, “feature set (that) is notable, and in some cases even tops that of…other more modern mobile banking/payments apps” with only $4.5m in spend. With $8m more in capital to invest, we believe that we will continue to generate significant progress with effective, strategic use of that investment.

For now Moven’s objectives are clear. First is to invest in the product and create the defining benchmark for the ‘downloadable smart bank account’ category in the US. With this new funding Moven can now fully capitalize on the hundreds of thousands of prospects and emails built over the last few months. And we can continue to invest in ground-breaking features and tools that will redefine the banking experience for every one of our users.

Second, is to exclusively align with strategic partners in other parts of the world to integrate the Moven app with their basic banking experiences. We have always envisioned the disruptive change occurring in retail banking as a global phenomenon. We will now be moving forward with a number of international partnership agreements that will give us presence on three continents while creating new revenue opportunities. You’ll be hearing a lot more from us about these partnerships and launches in the coming months.

It’s hard to believe that it’s been only 18 months since our initial funding, but if our accomplishments to date have been any indication then the journey has only just begun. We believe that in short order millions of customers will be using our app each day to help them spend, save and live smarter.

Thank you for your incredible support thus far and remember to keep on Moven!

– Brett King

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America’s Urban Jungle Breeds Diverse Real Estate Climates

FinancesHousingSpending

A well-known real estate truism is that housing prices in America’s biggest cities are much higher than the national average. New Yorkers, for example, often complain that thousands of dollars a month in rent only gets them a tiny one-bedroom apartment, especially in Manhattan, and one might assume that’s the case for every major metropolitan area across the country.

According to recent census data, it does hold true that it’s expensive to buy or rent a home in the city – but there isn’t one monolithic real estate climate across the country, and each city has a separate economy and demography, so there are some surprising differences in how much it costs to live from city to city. SmartAsset takes a deeper look at the rent-to-income ratio price-to-rent index to show the different housing markets in four of the biggest US cities… Read more at SmartAsset

This article is part of series based on Moven’s infographic on housing spend.  Join the conversation on Twitter @getMoven.

RentHop Cost of Living Article

Looking at the Hidden Costs of Living in New York

HousingLifestyleWellness

When you’re comparing places to live, it’s important to remember that your total cost of living can vary widely between two places even though the rent or mortgage you’d pay would be the same in both places.

RentHop digs into spending data in New York City for three key drivers of household expenses – food, transportation and entertainment – to illustrate how even adjacent neighborhoods can have strikingly different costs of living.   Read more at RentHop!

This article is part of series based on Moven’s infographic on housing spend.  Join the conversation on Twitter @getMoven.

Moven Analyzes Housing Spend

Moven Info-graphic: How Much Should You Spend on Housing?

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When it comes to renting or buying, having the right insights can make a huge difference to your financial health.  At Moven, we’ve come up with a number of rules of thumb and key insights to help you make smarter financial decisions.

1. First, your monthly housing cost – rent/mortgage, utilities, maintenance – should be less than 1/3 of your income.   Simply divide your annual income by 40 and use that amount as your maximum.

2. Second, consider buying a home only if you plan on keeping for at least 7 to 10 years.  That’s about the a typical economic cycle; anything less and you risk losing your money to broker and bank fees.

3. Next, look for a property where it’s price to rent ratio is comparable to the neighborhood average.  To find the price to rent ratio, simply divide the purchase price by the annual cost to rent the same property (or one like it).

4. If you live in a pricey city, try to keep your housing spend in line with your peers.  Spending less than a third of your income on housing may be harder in bigger cities, but don’t let yourself become house rich and cash poor!

5. When buying a home, be conservative with your expectations of its future value.  Think of your home as a way to protect rather than grow wealth.  Remember that home prices don’t typically increase that much more than the rate of inflation.

6. Take advantage of the current low rates, but do so responsibly by putting 20% down and having 10% set aside.  Buying a home often has many unforeseen expenses, so be sure to have a buffer.

Check out the info-graphic below for more details and be sure to join the conversation on Facebook and Twitter!

Moaven Analyzes Housing Spend
Moven Analyzes Housing Spend

 

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Finding Gratitude Everyday

Lifestyle

 

When I talk about financial gratitude with people, they often look back at me with a blank stare since I find it’s not a concept that’s talked about often.

To me, financial gratitude is when you’re grateful for the resources that you already do have, instead of always focusing on what you don’t have.  If you’re always focused on what you don’t have, you’re focusing on the negative instead of being appreciative of what you already do have. Keep reading

Jill Kathan

Our Live Rich, Spend Smart Winner

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Moven is proud to announce the winner of our “Live Rich, Spend Smart” 2014 contest: Jill Kathan.

During the month of January Moven received submissions that resulted in thousands of shares and reached over 3 million people all over the U.S. about how they make smarter spending decisions to live rich each and every day.  Many of the stories were inspiring, but one stood out the most.

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Detroit is a city under siege.  The recent financial crisis has had a devastating impact as auto manufacturers shuttered factories, banks foreclosed on homes, and the city even filed for bankruptcy.

Despite all this, it is still a city full of hope. There are many who still call it home and remain steadfast in their belief that Detroit will rise again.  Among these is our winner, Jill Kathan.

A graduate of Michigan State, she served her city for seven years as an elementary school teacher.  After marrying her sweetheart and having their first child, she chose to stay home with her daughter, Kelsey Anne.  But that hasn’t kept her from volunteering at her daughter’s school whenever she can and keeping a strong network of friends and family around her.

Being a stay-at-home mom was part of Jill’s live rich and spend smart mentality.  Switching from a dual to a single income household meant a tighter budget, but more time together as a family.

Jill and her husband met the challenge to live rich and spend smart in three ways.

 

Honoring the Future

Jill and her husband are always thinking about their future selves.  Whether buying their first home, saving up for a dream car, or planning for retirement, every dollar was given a purpose.  Together they have a clear set of long term goals that helps define how they spend day to day.

“When you plan, it’s easier to save,” she says. “We have a family budget and know what we’re going to spend and not spend. We have even started planning ahead for Christmas!”

 

Managing Money Hand in Hand

For any of their plans to succeed, Jill and her husband practice another spend smart, live rich principle: managing their money hand in hand.  The two of them are in constant communication about their spending choices.  With a clear vision of their shared future together, they almost never fight and find that working so closely together keeps their marriage strong.

“I am very communicative with my husband about money.  Both of us always know what is going on with our money since we’re both equal partners in this,” Jill states.

 

Choosing Gratitude over Debt

The final piece of Jill’s approach to living rich and spending smart is to always choose gratitude over debt.  Any budget, no matter how rich, always has its limits.  And it’s always tempting to choose debt over making difficult choices.  Jill and her husband have found that practicing gratitude for what they have, rather than obsessing over what they can’t afford has helped them maintain their financial health.   They almost exclusively use debit cards and only buy what they can afford.

And now that her six-and-a-half year old daughter is old enough for an allowance, Jill is passing on her philosophies to her as well.

“Not only am I not living with debt, but I am teaching my daughter the importance of money. She knows she can’t have something if she doesn’t have the money for it in her piggy bank,” says Jill.

 

So join us in congratulating Jill and her family for living rich and spending smart.   You’ll be hearing more about her and other contestants.  We hope that they are an inspiration and help you reflect on the many ways that you can live rich and spend smart!

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A big thank you to our partners David Bach, Wisebread, GoGirlFinance, Phroogal, Rockstar Finance, and MoneyDesktop for their support. 

What are David Bach’s tips on how to live rich? Watch them here!

 

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