Should You Get a Sugar Daddy?

It sounds easy to have a sugar daddy, right?  Some older rich man will just pay for your company.  And you can use that money to pay for things you actually enjoy doing instead of selling yourself out to some boring job.  Unfortunately, the realities of being a sugar baby are rarely so ideal.

Being a sugar baby is NOT EASY.  For one thing, you have to have a likable personality and favorable looks.  You don’t need to be a model to be a sugar baby, but you have to keep yourself well kept up.  That’s why becoming a sugar baby is also expensive, although you can make a good amount of money, you will also spend a lot on clothes, makeup, and sometimes even travel.

If you are going to have many men after your company, you will also have to learn how to schedule your time.  This may not be a job you can easily juggle part-time.  You have to keep track of all the “gifts” the men give you and report them on your tax forms, but you can also get tax write-offs for things you deem necessary for your business.

Don’t assume no one will find out; your friends and family are likely to find out eventually.  This is not a job you should do if you want it to be a secret.  Selling your time to men for money is often stigmatized and it could hurt your relationship with jealous partners or worried family members.

There is also a safety aspect and you must be ready to protect yourself not only physically, but legally.  You can’t give out too much personal information because it could make you susceptible to stalking. Learn the laws in your state for the job.  Prostitution is illegal in many states so you must make it clear if you engage in sexual acts with these men that they are NOT paying you for sex.

Some women and men have been able to use sugar baby/daddy sites to fund college, a family, or even made it into a career.  Although it is often seen as a way to make easy money, there are many risks and drawbacks that you should be aware of before committing to the job.  If you think it’s right for you, then be prepared to do your research.

 

Have you been a sugar baby or something similar? Share your experience!

Acorns: The Best Way to Invest in Your 20’s

I LOVE my Acorns account.  I am not being paid to say this (although… if anyone from Acorns is reading this…).  I am constantly trying to get my friends and kids in my classes to start using Acorns and begin investing with ease.

Two years ago, I was a senior in high school with a job at my local movie theater and lots of expendable income that was being funneled into clothes and junk food.  After a lesson on investing in my statistics class, I started looking for a simple way to invest.  Acorns was the only app I found with easy accessibility and was free while I was a student.

Features

Acorns is a great investing app for your 20’s because it is almost all mobile and focuses on small and consistent investments. You can set up recurring investments or round ups. Round-ups is a feature where Acorns tracks your spending and will “round up” each purchase to the nearest dollar and invest that amount once it reaches 5 dollars.  For example, If you spend $3.78 on coffee with your debit card, Acorns will track that and put .22 cents in your account from your bank account.  Although this might sound small, I’ve had over 400$ automatically invested from round ups in the past 2 years.  This is a great tool, because it forces you to invest more if you start spending more.

steve-johnson-628975-unsplash.jpgPhoto by Steve Johnson

Recently, Acorns unveiled Acorns Later which is a retirement account managed by Acorns. They help you decide whether you should start a Roth, Traditional, or SEP IRA. These accounts are great because they have low fees and offer tax advantages over a regular investment account.

One thing to watch out for…

If you are not a student, and are therefore not eligible for Acorns for free, then there is a flat $1 monthly fee if you have under $5,000.  This could be expensive depending on how much money you are investing.  For example, if you only invest $20 a month, then that is a 5% fee.  On average, you want to be making more using Acorns than you spend on it. If you can’t spare about $50 a month on average, then I would recommend looking into other sites with free introductory rates. For accounts over $5,000, there is only a .25% fee which is a great rate for ETF’s.

How Inflation Affects Your Savings

What is Inflation?

The money you have today is most likely going to be worth less than that same amount of money tomorrow.  That is why saving for retirement is not just about squirreling money into a savings account, it’s about investing.

Have you recently gone into the grocery store to buy a can of soda and thought “Man, soda’s more expensive than I remember when I was a kid.”  If you have you have just noticed inflation.
The average rate of inflation is about 2% per year.  That means that 1 dollar this year will be worth .98 cents next year.  Similarly 100 dollar this year will be worth $81.71 in 10 years.  Here’s a chart for how the value of money decreases over time:

chart

As you can see, in 40 years the value of your money will almost half.  A savings account will generate some interest, but usually less than a percentage point.  In order to combat inflation, your money needs to grow more than 2% a year.

Why do we have inflation?

This is a highly debated topic for economists.  The current prevailing opinion is in support of inflation targeting.  Inflation targeting is the idea that economies do better under slight inflationary circumstances.  The argument states that inflation causes people to see increases in their salary (although they might not notice the raising costs) and also stimulates the economy by encouraging people to use their money instead of letting it sit in a bank account where it will lose value.

The Federal Reserve has a target rate of inflation of about 2% annually.  This is considered small enough to decrease volatility in the economy that come from high inflation and large enough to effect decision making in the general public.

How Do I Prevent Inflation From Affecting My Retirement?

In  order to stop inflation from chipping away at your retirement savings, you need to make sure your retirement money is earning interest at a rate greater than 2% a year.  Investing in the stock market is the most common way people grow their money; although, you do have to be careful with how you invest it.

Exchange Traded Fund (ETF)

Exchange Traded Funds are pools of investments that match the stock market.  ETF’s are not managed daily meaning you don’t have to pay the same fees as you would for a mutual fund.  ETF’s are a great tool for long term investment, because the low fees mean a smaller marginal cost which over time can save you loads of money.  For beating inflation, ETF’s historically average 10% returns per year, although that is a long term percentage.

Mutual Funds

Mutual Funds are very similar to ETF’s in that buying a mutual fund gives you access to many stocks at once.  Mutual funds, however, are usually run by hedge funds that try to beat the market.  Because they are providing a service by trying to get greater returns than the market, there is a larger fee for a mutual fund than an ETF.  Mutual Funds can also be a great addition to a portfolio.  Mutual funds also make about 10% a year.

Individual Stocks

Buying individual stocks CAN give you amazing returns on your investment, or you could lose it all.  Although this all or nothing mentality can seem attractive to some, it’s not a guaranteed way to stay above inflation.  If you really support a company and it’s product then go ahead and invest a small portion of your portfolio, but I wouldn’t bank on every stock beating inflation in the long or short run.