Set Your Financial Goals For 2021 TODAY!

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We’re just 24 days, or 3.5 weeks, away from the end of 2020. It was one hell of a year, and even saying that is a massively dramatic understatement.

We can complain about all of the ways in which the COVID-19 pandemic and other terrible life events left us financially devastated. And none of them would be out of place, made more evident by the increasingly dismal outlook of America’s economic future.

But the best way we can get ourselves out of this crisis and back into financial prosperity is through getting a head-start on our financial resolutions for 2021.

If you know your own personal situation with your finances well enough, you probably have a list of things you’d like to accomplish for the next calendar year:

  • Consistently save more money each month
  • Lose less money to “impulse purchases” on items you don’t need and/or cannot reasonably afford without racking up bad debt
  • Follow a set budget where certain categories of spending are only allocated a certain amount of money
  • Set up a side hustle to make additional income on top of your full-time job
  • Learn how to be a long-term investor in the stock market

 And the best way to achieve your goals is to write them out in crystal-clear fashion. The “SMART” framework for setting goals is indeed cheesy and overused, but it works surprisingly well with any goal related to finance:

  • S = Specific. Be precise about the detail you use in defining your goal.
  • M = Measurable. Make sure you can “measure” your goal so you know whether you are on pace to achieve it, have already achieved it, or are falling behind.
  • A = Attainable. Your current situation, with respect to income and your savings, should not require you to drastically change your lifestyle (except where exceptions apply).
  • R = Realistic. Being a millionaire from zero within one year is unachievable, but you can certainly take baby steps towards putting money in a low-cost index fund.
  • T = Timely. You want to have a hard deadline for when your goal should be achieved.

Let’s use a simple example to show how the “SMART” framework is appropriately used…

“I want to invest in the stock market”

Nope! Writing that kind of goal won’t get you anywhere and you’ll quickly find yourself at the end of 2021 wondering why you weren’t able to make it happen.

“Whenever I get a paycheck, 10% of my income will be put into a low-cost mutual index fund that tracks the S&P 500 with my broker Charles Schwab. By December 31st, 2021, I will have invested at least $5,000 into this fund.”

There we go! We dialed down the details to be as specific as possible, our end goal is directly measurable, it’s entirely possible to put away 10% per paycheck, we’re not making any unrealistic demands of ourselves, and we have a hard deadline for when our goal has to be achieved.

Goal-setting does NOT have to be complicated, especially in the field of personal finance. All you have to do is be honest and clear with yourself about what you want and how you’re going to get it.

But I’m curious to know… what personal finance goals do YOU have for 2021, and how are you going to make them happen? Reply to this newsletter and share them with us!

Almost 10 Months Into the Pandemic, Americans Are STILL Poor!

When small businesses nation-wide were being shut down and destroyed at the start of the pandemic, the Small Business Administration (SBA) and the Treasury Department issued Payment Protection Program (PPP) loans to said businesses.

The main idea behind this initiative was to provide small businesses with enough financial support to keep employees on payroll for at least two additional months and hopefully avoid permanent closure.

But according to new data from the government that was analyzed by The Washington Post, this entire initiative was nothing more than a way to put money in the pockets of much larger businesses:

“More than half of the money from the Treasury Department’s coronavirus emergency fund for small businesses went to just 5% of the recipients, according to data on more than 5 million loans that was released by the government Tuesday evening in response to a Freedom of Information Act request and lawsuit.

According to data on the government’s Paycheck Protection Program (PPP), about 600 mostly larger companies, including dozens of national chains, received the maximum amount allowed under the program of $10 million.”

Just take a second to realize what has happened: At least half of the $552 billion allocated for small businesses only went to a small fraction of businesses, who just happened to be the ones who didn’t need the money. The types of businesses who arguably benefitted from the COVID-19 pandemic and the nature of the shutdowns that ensued as a result.

To be clear, this is not a slight on the Trump administration. This is a slight against an obviously broken and corrupt government which did not properly allocate funds as promised.

It’s almost as if this entire scheme was a ploy to beef up the big businesses and eliminate all of their smaller competitors…

$93.5 MILLION in Monthly Revenue for Online Gambling in New Jersey

When small businesses nation-wide were being shut down and destroyed at the start of the pandemic, the Small Business Administration (SBA) and the Treasury Department issued Payment Protection Program (PPP) loans to said businesses.

The main idea behind this initiative was to provide small businesses with enough financial support to keep employees on payroll for at least two additional months and hopefully avoid permanent closure.

But according to new data from the government that was analyzed by The Washington Post, this entire initiative was nothing more than a way to put money in the pockets of much larger businesses:

“More than half of the money from the Treasury Department’s coronavirus emergency fund for small businesses went to just 5% of the recipients, according to data on more than 5 million loans that was released by the government Tuesday evening in response to a Freedom of Information Act request and lawsuit.

According to data on the government’s Paycheck Protection Program (PPP), about 600 mostly larger companies, including dozens of national chains, received the maximum amount allowed under the program of $10 million.”

Just take a second to realize what has happened: At least half of the $552 billion allocated for small businesses only went to a small fraction of businesses, who just happened to be the ones who didn’t need the money. The types of businesses who arguably benefitted from the COVID-19 pandemic and the nature of the shutdowns that ensued as a result.

To be clear, this is not a slight on the Trump administration. This is a slight against an obviously broken and corrupt government which did not properly allocate funds as promised.

It’s almost as if this entire scheme was a ploy to beef up the big businesses and eliminate all of their smaller competitors…

$93.5 MILLION in Monthly Revenue for Online Gambling in New Jersey

Since old-timers can’t go to the casinos and gamble their depression away, the only remaining outlet for them are online gaming sites that easily allow them to piss away their money on slot machines and poker tables.

And indeed, online gambling has EXPLODED during the COVID-19 pandemic. Just take a look at the numbers for a few states:

  • New Jersey: $93.5 million in revenue for October 2020 (+106.7% from October 2019)
  • Pennsylvania: $59.8 million in gross operational revenue for October 2020 (an all-time high)

Gambling.com’s Vice President of US Business Max Bischel had this to say about the emerging trend taking place nation-wide:

“You’re back to pre-pandemic levels with sports, coupled with the increase in online casino activity. It’s hard to think in retrospect what would have happened without a pandemic, but as the situation stands today it’s pretty positive for the industry.

…I don’t think there’s a correlation between casinos being open and online gaming being less. There’s definitely overlap between the same players. Based on what we have seen in the past when players did have the opportunity to go to a physical casino or play from the comfort of their own home, they are not directly tied to each other. They are separated in most cases.”

And thanks to the winter season that will last all the way until April, you can bet that gambling will continue to explode as it already has.

What can I say? In hard times, industries serving bad habits always come out as the clear-cut winners…

People Are Starting to LOVE the Idea of “Digital Cash”

Forget Bitcoin and cryptocurrencies – when you look at the emerging trends of spending habits in the United States, an increasing number of people are taking a strong preference for digital transactions over the old-school way of reaching into their wallets for bills and coins:

  • 34% of adults younger than 50 do not make any purchases in a normal week using cash
  • 10% of millennials use a digital wallet for their spending
  • 33% of American adults, regardless of age group, typically do not use cash to make a purchase within an ordinary week

PayPal CEO Dan Schulman has commented on this emerging trend, noting that many people are switching over to contactless payments as they don’t want to touch money with their hands anymore:

[Digital payments are shifting from] being a nice-to-have capability to a must-have essential service… I think we accelerated where we were going to be in three to five years. And in months, we jumped ahead, and I don’t think there’s any turning back from that.”

Well… being in the middle of a global health pandemic where all forms of human touch are heavily discouraged will tend to make that happen.

But I’m curious to know if the same has happened for you: Are YOU starting to use digital money more often than cold hard cash? And if so, why? Reply to this newsletter and share your experiences with us!

Move Over, Bitcoin – These Other Cryptocurrencies Are on the Rise!

The past two weeks of finance-related news have been single-handedly focused on the surging rise in Bitcoin’s price. Many investors are now confident that the famous cryptocurrency will soon break the $20,000 and go even higher in 2021.

Yet this news is taking our attention away from other cryptocurrencies that have exponentially increased in value during the calendar year of 2020. From statistics compiled by Bloomberg

Ethereum:

  • Increased five-fold in value since March 2020
  • Market capitalization of $70 billion

XRP:

  • Doubled in value since November 17
  • +355% in 2020
  • Bought at 3x the rate of Bitcoin on trading platform eToro

Litecoin:

  • Processes transactions at a faster speed than Bitcoin
  • Doubled in value since the start of 2020

I’m not necessarily saving you have to invest in all of these cryptocurrencies alongside Bitcoin. However, if you’re not exactly all-in on Bitcoin and want to seek out other crypto assets that may offer advantages over Bitcoin, you’d be missing out if you didn’t give them a second look.

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