Frugaling

Save more, live well, give generously

  • Home
  • Start Here
  • Popular
    • Archives
  • Recommended
  • Contact
  • Save Money
    • Lifestyle Downgrade
    • Save Money with Mindfulness
    • Save at Starbucks
    • Psychological Trick To Reduce Your Online Shopping
    • Best Freebies
  • Minimalism
    • 8 TED Talks To Become A Minimalist
    • We Rent This Life
    • Everything Must Go
    • Lifestyle Downgrade
    • The Purchase Paradox: Wanting, Until You Own It
    • Nothing In My Pockets
  • Social Justice
    • Destroy The 40-Hour Workweek
    • Too Poor To Protest: Income Inequality
    • The New Rich: How $250k A Year Became Middle Class
    • Hunter Gatherers vs. 21st Century Desk-sitters
  • Make Money
    • Make $10k in 10 Months
    • Monetize Your Blog
    • Side Hustle for Serious Cash
  • Loans
    • 5 Rules To Follow Before Accepting Student Loans
    • Would You Marry Me?
    • Should I Have a Credit Card If I’m In Debt?
    • $50k in Scholarships in 70 Minutes

Here’s When Fixing Your Interest Rate is the Wrong Decision

By Frugaling Leave a Comment

Share This:

mortgage

The property market is still in a gingerly stage; mortgage rates are at a low, and people may be tempted to change their mortgages and lock in on a fixed rate.

But is it always a good idea to do so?

Sure, locking into a fixed mortgage or investment loan gives you the advantage of knowing what your financial obligations will be for a pre-determined period and plan accordingly. This is a good strategy if you want certainty for your cash flow commitments- especially if you are sure interest rates will likely rise significantly.

However, fixing your interest rate is not always the right decision. Here are instances to consider first:

  1. Are you going to need the equity on your property for another investment during the period?

During the period of your fixed mortgage, you may need to access the equity to invest in a different financial obligation. The price won’t come cheap as your mortgage lender will charge you for breaking commitment. Unless you are sure the revenue from the new investment will offset the costs, accessing equity is a bad idea.

  1. Are you going to sell your property during the fixed loan period?

You never know the future, there might be an attractive opportunity available or a relocation plan, and selling your home is the next step. Unfortunately, mortgage lenders have penalties for breaking loan commitments, and it might cost you a lot. Before you rush to fix your interest rate, be sure of your relocation plans for the period.

  1. Will you need an offset account?

This is a transaction account linked to your loan. With an offset account, you can credit your loan occasionally to balance it and reduce interest payable on the loan. However, most fixed rates loans don’t permit an offset account. If you need one, don’t fix your interest rates.

  1. Opportunity for extra loan repayments

Some people are comfortable paying off their fixed interest rates as stipulated, but there are times when you’ll may want to pay more than your regular rate for the term. However, many lenders have limits to the extra amount you can pay. Having strict limits on your loan can be a bad idea at times like this. In order to avoid being stuck, consider making a part of your mortgage variable and benefiting from an offset account.

  1. When you can benefit from variable and fixed rates

If you are expecting a tidy sum that could be used to offset a bulk of your rates in the near future, consider getting a balanced fixed and variable loan. If you have one loan, you could split it into fixed and variable parts for that much-needed flexibility. While you offset on end, you maintain fixed payments at the other.

  1. When loans drop further

You don’t want to be that person who locks into a fixed rate mortgage only to find out the rates have dropped lower again. Before you rush into a commitment, study the market and be sure of the projections. Many people have been left disheartened because rates turned against them.

Filed Under: Money Tagged With: interest rate

What Role Does Invoicing Have in Accounting?

By Frugaling Leave a Comment

Share This:

Invoice message

An invoice, also known as a bill or tab is a record of purchase that enables a client to make payments for goods or services offered. Tabs provide a detailed description of the purchase such as parties involved, the quantity of purchase and prices of goods/services.

Invoicing, on the other hand, is the process of sending a bill to a customer once an item is shipped or a service is completed. This is a vital aspect of managing a business, and though it seems simple, it can be overwhelming. You can hire a bookkeeper to be responsible for sending bills and collecting payment if you can afford it. Otherwise, devote time in your schedule for billing.

Types of Invoices

There are several types of tabs that businesses can create and here are some of the common ones:

1) Standard – This type has a basic format and can be used in the same format for different business transactions and various types of clients (new, frequent, occasional clients). It contains all basic information found in any bill such as company name, name of the buyer, bill number, items purchased, etc.

2) Commercial – This is a special bill designed for documentation of any foreign trade like the shipment of machine parts from one country to another. It is used for customs declaration when items are crossing international borders. The commercial form comes with special transaction details such as country of origin, harmonized code for every product, carrier identification number and declaration to prove the authenticity of the bill.

3) Progress – It is used by companies performing projects that stretch over a long period. For instance, construction companies will use the progress technique since a project can take many years to be completed and is normally paid in installments.

4) Timesheet – This is a special type of bill mostly used by professionals whose services are based on the time taken to provide services. Such bills are normally provided by lawyers, consultants, and professionals whose services are more intellectual than technical.

5) Recurring – These are used for batch billing charges incurred on specific times such as bi-weekly or monthly.

Why Is Billing Very Important?

Creating and sending bills can be time-consuming. But it can help you effectively manage your cash flow. Besides this, billing is important for the following reasons:

1) Establish legal rights – It is your right to be paid for goods or services delivered. Documenting the items in a bill establishes your right to payment. If a customer fails to pay, you can use the contract and bills to sue them for owed payment in a court of law.

2) Great for record keeping – Bills enable you to keep track of when goods were sold, when projects were completed and the amount of money made. Bills also help you know which customers have not paid and the amount outstanding, allowing you to keep an eye on the status of your business.

3) Spell out what your customers are paying for – Bills break down what clients are paying for. This avoids any misunderstanding or conflicts during payment time. Clients easily understand what they owe you when you clarify the items or services you provided, increasing the chances of getting paid on time.

4) Audit evidence – There is always a likelihood of being audited by the IRS even when you do everything right. IRS audits check whether you properly report all income received during a financial year. Sequentially numbered bills provide more confidence that you have reported your income fully and correctly.

Documented bills can also be used to accurately file taxes since you will have all the information needed to calculate how much you owe in taxes.

5) Professionalism – How you handle the small things in your business shows a lot about your expertise. Clients will consider you a real professional when you bill them rather than ask for payment via informal agreements.

In today’s world where image is important, you won’t want to risk losing your customers because you use informal ways to ask for payments.

Preparing for the Invoicing Process

Before you start sending bills to customers, ensure you set up client accounts. Without setting up accounts, you may find that your billing system is inefficient and complex.

Here’s how you can prepare for the billing process:

• Get enough information from your customer before sending the bill. This includes contact details like company name, address, phone and email and their Company Registration Number.

• Consider using invoice software. The software automates your billing process, making it easy and more accurate. You can schedule both individual and batch bills to be generated and sent automatically to your customers. The billing software keeps track of all bills making it easy for you to know those that have been paid and those that are overdue.

• Offer convenient payment options. Besides payment by cheque, you can provide other payment methods like bank transfer or credit card. More payment options improve the possibility of getting paid on time.

Creating a Bill (What to Include)

It does not matter if you are a small business owner or responsible for handling bills for large companies, there are important components you should never overlook.

a) Professional header – The header appears at the top of the bill, and it consists of your business name or full name if you are self-employed. It also includes contact details like phone number, email address and mailing address under your business name.

b) Customer’s contact details – the client’s contact information is placed below the header. This includes the recipient’s name, phone number and address.

c) Additional information – These include the bill number, billing date, payment due date and the payment options available. Any other details should be written clearly.

d) Itemized breakdown of goods or services – This section of the bill is divided into five columns that contain the services provided or goods supplied, supply date, quantity, unit price and the subtotal amount you are charging for the items or services. Calculate the total and write it clearly after deducting discount and adding delivery fees, sales tax and other fees where applicable.

e) Terms and Conditions – The terms and conditions are written below the total amount. These may include return policy, the due date, and charges incurred for late payments.

Filed Under: Money Tagged With: invoicing

Can You Make Extra Money With Active Trading?

By Frugaling Leave a Comment

Share This:

Forex trading
Forex trading

My favorite trading has always been forex. I travel a lot, have accounts in several countries, so it makes sense to try and trade currencies in order to take advantage of a low exchange rate.

For example, the Euro is now 1.12 to the US dollar, when back in October 2014, it was as low as 1.28.

Simply put, that means that 1,000 euros would buy $1,120 today, when they used to buy $1,280 24 months ago. A 12% decrease in the amount of dollars you can get. That is bad news if you are planning a US holiday next year and live in a European country, however, the other way around, if you have US dollars and need Euros, you can now buy more Euros than you would have last year.

This is why I use Forex trading. I can buy Euros when the rate gets weaker, and buy dollars when they are at a cheap price. There are many sites for learning Forex trading made easy with technologies nowadays. You can download a demo and start trading at no risk. I am no wizard, so I have no idea of what the future brings, but there are tools to help you make a decision to buy or sell.

For example, currencies depend a lot on economic data. If the US announces a low GDP and low manufacturing sales, the Dollar is likely to weaken. Politics also play a role, as well as a ton of minor factors, so do not expect only the economic announcements to influence currencies.

That is when it gets complicated. An unexpected report outcome, or an external event can shake currencies a lot. Meaning you can either make a lot of money, or lose a lot. I would recommend first that you never fund your trading account with money you are not comfortable losing. While this is not the aim, it can certainly happen, even experienced traders lose money sometimes.

Second, active trading can be as intense as you want it to be. I used to take big positions, with a high margin, and do some day trading, meaning I would sometimes be up in the middle of the night waiting for an economic announcement, stressed to the max, watching the screen tick and tick, sometimes in the opposite direction I wanted it to go. It can eat you up.

Now I take long term positions, I check my accounts once a week or so, close a few trades, open some new ones… always with a very low margin, so I can afford to hold a position until it goes where I want it to go. Active trading is interesting in that you are the master of your investments. However, you should try up a demo account first and see how you are doing, because you can’t get emotional, or do any mistakes, when it is your money on the line.

Filed Under: Money Tagged With: active trading

  • « Previous Page
  • 1
  • …
  • 30
  • 31
  • 32

Follow

  • Facebook
  • Google+
  • Pinterest
  • RSS
  • Twitter

Subscribe

Best Of

  • 5 Tricks To Save Money At Starbucks (Updated)
    5 Tricks To Save Money At Starbucks (Updated)
  • Was Albert Einstein A Minimalist?
    Was Albert Einstein A Minimalist?
  • The New Rich: How $250k A Year Became Middle Class
    The New Rich: How $250k A Year Became Middle Class
  • Living In A Van To Becoming A Pornstar: Crazy Ways Students Pay Tuition
    Living In A Van To Becoming A Pornstar: Crazy Ways Students Pay Tuition
  • I have $37,718.68 in debt. Would you marry me?
    I have $37,718.68 in debt. Would you marry me?
  • My Costly Battle With Indigestion
    My Costly Battle With Indigestion

Recent Posts

  • How to Eat Healthy on a Budget
  • How To Live Stream Your Art
  • 5 Fun Summer Activities on a Budget
  • How to Pay Off Medical Debt
  • 5 Ways to Save Money Before a New Baby

Search

Archives

  • June 2023 (1)
  • May 2023 (2)
  • January 2023 (1)
  • March 2022 (3)
  • February 2022 (2)
  • November 2021 (1)
  • October 2021 (2)
  • August 2021 (4)
  • July 2021 (5)
  • June 2021 (3)
  • May 2021 (2)
  • January 2021 (2)
  • December 2020 (2)
  • October 2020 (2)
  • September 2020 (1)
  • August 2020 (3)
  • June 2020 (1)
  • May 2020 (2)
  • April 2020 (1)
  • February 2020 (2)
  • January 2020 (1)
  • December 2019 (1)
  • November 2019 (5)
  • September 2019 (4)
  • August 2019 (1)
  • June 2019 (1)
  • May 2019 (1)
  • April 2019 (1)
  • March 2019 (3)
  • February 2019 (1)
  • January 2019 (3)
  • December 2018 (1)
  • September 2018 (2)
  • July 2018 (1)
  • June 2018 (2)
  • May 2018 (1)
  • April 2018 (5)
  • March 2018 (6)
  • February 2018 (4)
  • January 2018 (1)
  • December 2017 (10)
  • November 2017 (3)
  • July 2017 (2)
  • June 2017 (5)
  • May 2017 (2)
  • April 2017 (8)
  • March 2017 (4)
  • February 2017 (3)
  • January 2017 (2)
  • December 2016 (2)
  • November 2016 (4)
  • October 2016 (2)
  • September 2016 (1)
  • August 2016 (4)
  • July 2016 (1)
  • June 2016 (3)
  • May 2016 (3)
  • April 2016 (4)
  • March 2016 (5)
  • February 2016 (2)
  • January 2016 (2)
  • December 2015 (3)
  • November 2015 (5)
  • October 2015 (5)
  • September 2015 (4)
  • August 2015 (6)
  • July 2015 (8)
  • June 2015 (6)
  • May 2015 (14)
  • April 2015 (14)
  • March 2015 (13)
  • February 2015 (12)
  • January 2015 (15)
  • December 2014 (10)
  • November 2014 (5)
  • October 2014 (6)
  • September 2014 (7)
  • August 2014 (12)
  • July 2014 (11)
  • June 2014 (12)
  • May 2014 (16)
  • April 2014 (13)
  • March 2014 (13)
  • February 2014 (9)
  • January 2014 (20)
  • December 2013 (9)
  • November 2013 (18)
  • October 2013 (15)
  • September 2013 (11)
  • August 2013 (11)
  • July 2013 (27)
  • June 2013 (18)
  • May 2013 (16)

Best Of

  • 5 Tricks To Save Money At Starbucks (Updated)
  • Was Albert Einstein A Minimalist?
  • The New Rich: How $250k A Year Became Middle Class

Recent Posts

  • How to Eat Healthy on a Budget
  • How To Live Stream Your Art
  • 5 Fun Summer Activities on a Budget

Follow

  • Facebook
  • Google+
  • RSS
  • Twitter

Copyright © 2025 · Modern Studio Pro Theme on Genesis Framework · WordPress · Log in