For some of you reading this, you may have already heard from others about how rare coins are quite a stable type of investment. It’s a popular opinion for those who’ve started investing in rare coins – one which should give more than just a grain of truth to it. Before reading this, you may have already done your research about investing in rare coins, and while there are avid supporters of this type of investment, you may have also encountered mixed responses from others. Continue reading
When all your family members are busy managing their own lives, it can be hard to keep track of the money coming in and going out. This can create a lot of stress for you as the head of the household.
Here are some of the best ways to manage your family’s budget, as well tips on how to stay out of debt:
Step 1: Get Organized With A Budget Planner
With a budget planner, it’s easy to keep track of your spending and set goals for the future. You can use an app, a spreadsheet, or even a notebook to create a budget. Budget planners can help with financial security. Whether you are looking for ways to lower your monthly expenses or saving up for that big purchase, a budget planner will help you stay on track. Initially, your budget will not be accurate because of many variable expenses, but after a few months, your ability to predict expenses based on averaging your costs will improve.
Some tips for saving money with a budget planner include:
* Saving on groceries by using coupons and store sales.
* Selling used clothes, books, and toys online and then using the proceeds to buy other items.
* Planning out your meals beforehand, so you only buy what you need when going to the supermarket.
Step 2: Designate a Money Manager in the Family
Money management is vital for all members of the family. One way to make it easier to manage all everyday household expenses is to have a family budget managed by one of the parents. This “money manager” will then collect money from the earning members of the family and spend it on household expenses.
Step 3: Automate Your Savings and Investing
Amassing savings is not always the easiest thing to do, but it will force you to think twice about everything you buy, especially if you tend to use credit cards to spend more than you earn. Automation can be used to make saving money easier. You can use an app that will automatically put away a set amount of money each month. The app will take care of all the complicated calculations for you.
Step 4: Make Better Decisions For Your Finances
To make better decisions for your finances, it is crucial to be aware of the pros and cons of each financial decision. There are many ways to do this, but one way would be to start with the most expensive option and work your way down until you find something that is most sensible. This method considers not only what you want in a specific financial decision but also how much money you have and what decisions will be the most beneficial in the future.
Step 5: Check Your Credit Score Regularly To Keep It In Good Condition.
It’s easy to keep an eye on your credit score. There are many ways to do this, such as with an app or by logging onto the website for your credit card company. To ensure that you have a good credit score, make sure that you always pay off your credit card balance, avoid maxing out the card, and make sure that you do not spend more than 20% of the limit on any one card.
Summary
Although it might seem a little awkward in the beginning to use a budget planner, designate a family money manager, and automate savings and investments, you will soon get into the habit of doing it.
These three habits will then push you to start making better financial decisions based on the consequences you will experience in the future and become more vigilant about your credit score.
There are several leasing structures available to those seeking to rent commercial space. However, a triple net lease offers unique benefits to both landlords and tenants. If you are considering this type of agreement here are some pros, cons, and formulas to help you calculate a triple net lease.
Calculations for renting commercial properties are much different than when renting residential ones. Oftentimes, spaces are divided, combined, or shared. Not only does it affect how much usable space you have access to, but also how much you pay each month. Therefore, most landlords determine rental fees with pricing by square footage.
While there are different leasing options for commercial space, many people utilize NNN leases or triple net leases. In this type of property lease agreement, the tenant/renter assumes responsibility for the additional costs to own and operate the property. These expenses include real estate taxes, insurance, and maintenance costs. Since the tenant is taking on more financial risk, they also receive lower rental rates.
When you calculate a triple net lease, you must determine both the base rental rate and the expected operational costs. These formulas and figures can become confusing, especially if there are multiple renters. Using a commercial lease calculator can be very helpful. But, you can also do the math for yourself using the basic format of base rent + additional assumed costs.
To calculate the annual base rent, simply multiply the rate by the area. For example, let’s say the annual rate is $30 per foot for a space that is 2,500 square feet. So your formula would look like this:
$30/sq. ft. x 2,500 sq. ft. = $75,000 annual per year
Then, divide the total by 12 months. With these figures, that would give you a monthly rental rate of $6,250.
In order to find the total for the additional costs, start by adding the annual fees for taxes, insurance, and expected maintenance expenses. Then, divide the sum by the total square footage of the space.
Although it seems simple enough, here is where calculations get tricky. The formula is much simpler if you rent the entire space to a single tenant. However, if there are several renters, your quote may be in Rentable Square Footage (RSF). In this equation, you must also account for shared financial responsibility to upkeep common areas such as lobbies, hallways, restrooms, and courtyards.
Another thing to consider when you calculate a triple net lease is the property value and associated taxes. While most owners use the previous year’s valuation on property taxes, large increases can severely impact the additional costs. It’s a good idea to review these figures and assess rental agreements on a regular basis since these expenses fluctuate from year to year.
A triple net lease offers several advantages to both the landlord and tenant. However, many people avoid them because it does require more knowledge of commercial real estate laws and regulations. Here are a few important advantages and limitations to consider before you sign a triple net lease agreement.
Many people who rent out commercial real estate prefer a triple net lease agreement. It provides a secure investment vehicle with minimal risks. The owner continues to build equity due to capital appreciation of the property over time. Yet, the owner has more freedom since they do not play an active role in the property’s management. It also removes the financial obligations and risks of owning real estate since tenants assume the operational and management costs. Furthermore, it guarantees long-term occupancy since most state terms lasting 10-15 years. This gives the owner a stable source of income and reduces losses due to the property sitting vacant. Best of all, the leases are transferrable so you do not need to make investment decisions based on the duration of existing terms.
Although these leases may seem to favor landlords, it also provides many benefits for tenants as well. Since they assume more financial risk, it means they have lower rental fees. There is more room for negotiation as well since taxes and maintenance fees tend to fluctuate. With the landlord playing a less active role, tenants also enjoy more flexibility. A triple net lease grants tenants more freedom to customize the space to their specific needs. And, with longer leasing terms, it provides a stable location to operate their business.
While a triple net lease is attractive to both landlords and investors, there are some drawbacks to keep in mind. First, they are limited to commercial real estate. There are also net worth requirements for those wanting to invest in a property under a triple net lease. You must have a minimum net worth of $1 million, not including their primary residence and income. If you don’t meet this requirement, you can also enter a lease if you have an annual income of over $200,000. However, smaller investors must go through real estate investment trusts (REITs).
As the owner, you are also capping your earning potential. Most agreements specify fixed long-term rent for tenants since they assume the financial risks of the property. Therefore, there are limited opportunities to add value with updates or earn more from building if property values rise until the end of the lease.
Of course, you can’t overlook the financial risks the tenant assumes for the property. Although it may be a good deal when maintenance and operating costs are low, it can quickly turn against you. Increased operational costs, higher taxes, insurance deductibles, and damages can undermine your profit margin. On the other side of the coin, a tenant may not perform maintenance and repairs that meet the landlord’s standards. If you do not conduct regular checks on the building’s condition, the owner could be left with a huge list of repairs at the end of the term agreement.
The bottom line is that you should never enter into a contract unless you fully understand the terms you are agreeing to. While a triple net lease may be beneficial for both parties, do your research before you make a decision you regret. You can begin by finding information online, but it is best to seek legal counsel to review any rental or triple net lease agreements before you commit.
Jenny Smedra is an avid world traveler, ESL teacher, former archaeologist, and freelance writer. Choosing a life abroad had strengthened her commitment to finding ways to bring people together across language and cultural barriers. While most of her time is dedicated to either working with children, she also enjoys good friends, good food, and new adventures.