How Youthful Spending Affects Later Savings

When we’re younger, it feels like we can put off saving for later. We have all of the time in the world to make up for any youthful financial mistakes we might make in our late teens and even mid-late twenties. It’s easy to fall into the trap of feeling financially invincible. This is why it is important to be vigilant.

Trust us: better to be lame and frugal now than to not be able to retire because you have to spend your later years paying for all of the mistakes you made when you were young. Plus, frugal living and saving responsibly doesn’t necessarily have to be about staying home and eating ramen every night. There are a lot of practical ways to dramatically reduce your spending that won’t have a huge effect on your lifestyle. Check it out.

Power Consumption

You might think that spending all day at work and most nights out with friends is already helping you save power. In a way, you’re right. But there are a bunch of ways that power consumption can sneak up on us. For example, do you leave your stuff plugged in all day? Even if your devices are turned off, leaving them plugged in will cause them to leech power from the grid.

Are you paying as little as possible? Call the power company and talk to them about all of the service charges and taxes you see on your bill. You can likely get many of them removed. If you live in a deregulated energy market, spend some time shopping around for the best rates. Deregulation gives you the power to choose which companies provide which kinds of energy. Take advantage of that to get a lower rate!

DiY Stuff

Dumpster diving carries very little of the stigma that it used to carry. When your parents were teens and twenty-somethings, thrifting was cool but dumpster diving was considered “low rent” and socially frowned upon. These days, thanks to all of the great new supplies and expanded access to tutorials, nobody will ever be able to tell that you didn’t buy all of your furnishings and decor brand new.

Diy Food

You know you can do more with a waffle maker than just make waffles, right? Waffle makers can also be used to make panini sandwiches, quesadillas and a bunch of other stuff. Take some time to surf the web looking for ways to turn single use kitchen gadgets (the kind everyone insists on giving you for your first place even though you’ve never successfully cooked a meal in your life) into multipurpose devices. Another good example is the slow cooker. Use it as a breadmaker as well as a dinner helper!

Use Cash

Of course, a simple Google search will turn up thousands of ways to save money on what you spend. If you really want to protect your financial future, you’ll save your credit. Financial boondoggles have a way of sticking around on credit reports and dogging you long after you’ve cleaned up your spending habits. So, instead of taking out a card with the biggest credit limit possible and then maxing it out, start with a secured card and a small credit limit. This will help you get used to using credit responsibly and paying your bills on time. Use the credit card to pay your Netflix bill and other small recurring expenses and then pay it off entirely every month. Use cash for everything else. You’ll build up a great credit score and history that will make it much easier to qualify for “big kid” credit like mortgages, etc. later on.

Out of Sight Out of Mind

Most employers offer direct deposit these days. Have yours set up to distribute your paycheck into two accounts. 10% of your paycheck should be tucked away into a savings account (the highest yielding account you can get). Having it deposited directly into savings will dramatically reduce the urge to spend it before you can make the transfer yourself.

Another good idea is to start investing using little amounts. Use apps like Stash or Acorns to invest a few dollars each week into an investment portfolio. This will give you real time experience in tracking investments without the hefty financial risk that comes from the type of investing that comes along when you get a little bit older and start really building your portfolio.

Remember: you don’t have to live like a friendless pauper to ensure your financial future. You do, though, have to be as responsible as possible now so that you won’t have to worry about whether or not you’ll be able to retire when that time comes.

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Mind Games: When Saving and Investment Aren’t a No-Brainer

Saving and investments will help prepare you for retirement. This should be a no-brainer, but more than half of Americans have no investments when it comes time to retire. What gives?

Clearly there’s a disconnect between the smart thing to do and what actually gets done. Researchers at Prudential think that the problem lies in the way human brains function. By revealing these inner quirks, they think they’ll be able to convince people to actually start saving for retirement in a meaningful way. Check out their thoughts and be the judge for yourself.

Retirement Income

One of their chief findings is that people have a hard time working for their future selves. People have brain responses that are nearly identical when thinking about a complete stranger and when thinking about their older selves. That’s a big reason why people don’t save for this future self. They can’t relate to this person, imagine their needs, or even know if they like this person or not – even though it’s them!

Other innate brain behaviors are equally important. Procrastination is built into the human mental mechanism. Putting money aside for the distant future is uncomfortable to the brain – almost as much as physical pain. It’s hard for people to avoid the temptation of satisfaction spending. Lastly, too many choices (as is often the case when considering investment options for retirement) causes people to freeze and not act at all.

Overcoming these brain foibles is integral in saving for retirement. It’s how Prudential helps their customers to gain healthy habits that will promote financial progress over the decades, and make retirement secure and happy. Check out their videos to learn more about how your brain can hurt or help you future retirement goals.

The Single Parent Financial Safety Net

At the risk of recounting anxieties here that are no doubt familiar to pretty much anyone reading this: times are tough at the moment. Being a single parent isn’t exactly a walk in the park at the best of time, but the state of the economy has further complicated the prospect of parenting without a partner. While the challenges of single parenting are probably too numerous to list here, a good argument could be made that virtually all of them are in some way, monetary. At the very least, if money doesn’t inevitably make someone’s life easier, having less of it makes life harder.

So, with the importance of money established, here are ways in which a single parent can manage it wisely.

Track Income and Carefully Maintain a Budget

This may seem like an obvious one, but establishing and sticking to a budget is extremely important. Do so by taking an inventory of monthly spending and plot out spending patterns based on fixed and average expenditures: how much always goes to rent or mortgage and bills, and how much on average goes to food, gas, clothing, entertainment, etc. Once a budget’s been set up, it’s easier to plan spending and it’s easier to save.

Almost inevitably, budgets reveal surprises: more money is consistently spent in one area than you’d have guessed, while you end up spending less in another, etc. Understanding those trends also contributes to effective saving.

Build up Savings and an Emergency Fund

Everyone’s saving decisions and priorities, of course, unique and based on their specific budget and spending habits. However, there are some more universal hints that can contribute to good saving habits. One good strategy is thinking of savings as money that isn’t yours (for spending at least), or like another bill. Getting in the habit of putting away as little as twenty dollars a month in a savings account can yield huge benefits later. Most banks will automatically transfer a portion of a paycheck into a savings account.

Make Sure Your Insurance is Up To Date

While no one is particularly fond of making insurance payments, doing so is far better than the alternative. Most important are health and life insurance. More than 60% of bankruptcies in the United States are related to medical expenses and when one parent is watching over their own health and that of their children, the threat of those expenditures is that much more pronounced. Life insurance is just as important. Morbid as it is- buying life insurance is comparably important. Should anything happen to a single parent, life insurance can provide for their children.

Plan Ahead, Stay Employable and Plan for Hardship

Keeping money flowing into the family coffers is obviously extremely important, and having a job is necessary for that flow of funds. If additional job training and/or education is available, it’s virtually always a good idea to take advantage of the opportunity. If a job is temporary, shaky or layoffs seem likely, get started on looking for more work. While it’s a cliché to assert that the best time to look for a job is while you have one, it’s also true. Start a job search before it becomes absolutely necessary to do so and consider padding your income with part time or freelance work if that’s available and doable.

Furthermore, if a gap in employment does loom, look into what steps are necessary for setting up unemployment benefits. Less well known is supplemental unemployment insurance, which can be invaluable for those concerned that an unemployment is looming. Generally, supplemental unemployment programs will pay at least 50% of someone’s former paycheck, making up the difference between state benefits and that 50% or more.

Basically, it comes down to planning and organization. Plan a budget, plan for the future, plan for potential financial hurdles and organize accordingly. Do that and there’s very little that can’t be accomplished.

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Frank McCourt is an investment, frugal living, and just-about-anything-else finance related. When pried away from his laptop, he enjoys fishing and hiking with his wife across the northwest.

How Should You Budget For Christmas?

Christmas is a time to enjoy the company of your loved ones and slow down a bit before the start of the New Year. But it can also be quite a stressful time when it comes to money.Budget

A lot of people end up spending quite a lot of money during this holiday season and this can even lead to debt.

Here are some simple tips to ensure you budget well for Christmas and get to enjoy it without spending a fortune.

Draw Up A Budget

It is a good idea to draw up a budget for yourself for the Christmas season. You can do it by dividing the budget into different categories. The main expenses during Christmas include:

  • Food
  • Gifts
  • Cards
  • Decorations
  • Possible travel

You can then think a little bit how much you want to spend on each of these categories. The key is to make sure that you have saved some money during the year to ensure you don’t need to loan money to purchase anything. Don’t go wild with your credit cards either.

If you want to use them it is a good idea to look carefully, which credit cards offer the best deals for you to use.

How Much To Spend

Of course you need to carefully think about how much you want to spend on each category. For instance, with gifts you should be careful about thinking the people you really must be buying a gift to. Don;t feel pressured to buying expensive gifts to people that you don’t even spend a lot of time with.

Remembering people with a Christmas card is enough to show you are thinking about them.

Clever Tips To Save Money

The good news is that there are a lot of good tips on how to save money and still have a great Christmas. Here are some tips for each of these categories.


Food is often one of the biggest parts of Christmas expenses. The best way to save money with food is to draw up a menu well before the holiday and be realistic with the amount of food you are going to eat. Don’t buy crazy amounts of food so that you don’t end up throwing it away.

Gifts And Cards

A good way to save money with your gift shopping is to look into the option of making your own gifts and cards. For instance, making great homemade food gifts can be a really nice way to remember friends and neighbours and it will be a lot cheaper than a wine bottle or similar.


This is another bracket where you save a lot of money by making your own decorations. There are a lot of great ideas at the Reader’s Digest website. Making your own decorations is not only cheaper but it can also be a fun thing to do together with the kids. Make sure you also use some of your older decorations as you don’t need to buy new ones every single year.

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Katherine is interested in providing budgeting tips and help in finding accounting services. She also likes to volunteer to get young people involved with the local communities and is passionate about learning salsa dancing.

3 of the Smartest Ways to Produce Funds for Your Business

BusinessYou might have a number of ideas for how to start up a small business, but what if you don’t have enough money to fund that business? You just shouldn’t simply abandon your entrepreneurial dreams because of a lack of cash. There are a number of financial alternatives to help you realize your dreams. From different types of low interest loans to contributions from different sources, you can easily find the required money if you know where to search for it. Even if you have already started your dream business, and are now finding it difficult to produce some extra much-needed cash, don’t worry; here are a few different financial sources which you can consider –

  • Try to get Small Business Loans – If you need a significant amount of capital to fund your business, a small business loan can be the ideal choice, since it can provide you with thousands, at a comparatively lower rate of interest. Even though there is the chance that you will borrow more than what you actually require, a small business loan is probably one of the less expensive ways of securing funding.
  • Consider Advance Orders – If you are clearly aware of the value of your business and also have some customers lined up for your products and/or services, you can consider advance orders as an effective option. Advertise your services well in advance, to promote your business and your offerings. This will not only provide you with sufficient working capital, but will also help you validate your business idea. g

Sell your own stuff for cash– One of the best ways to raise funds for your business is to sell off your own personal products. This can be an ideal solution for many to make some quick and instant cash. For example, MusicMagpie allows you to sell all of those old CDs, DVDs, games, electronic and technical gadgets, old clothes etc. It’s free to send these items to them, so just pack them up and post them off, or get their convenient courier service to take all your unwanted stuff off your hands!

A Brief Guide to Child Trust Funds

Child FundsChild trust funds were introduced in April 2005 in a bid to encourage parents to start saving for their child’s future from an early age. The government made an initial contribution, which was set at £250 per child when the scheme started, and also pledged a top-up when the child turned seven.

In May 2010 it was revealed that the child trust fund would be stopped, and babies born on or after January 1st 2011 are not eligible for the account. Accounts that have already been opened will remain so and parents can continue to make contributions, up to the maximum allowable limit. It is also still possible for funds to be switched to a different child trust fund.

There are three main types of child trust funds and there are many banks, building societies and other organisations that offer them. The accounts can be cash-based or share-based, or a combination.

Once opened, parents, family members and friends can contribute to a child trust fund up to the maximum limit of £3,600 a year. Any government contributions and interest received do not count towards this limit. The year begins on the child’s birthday. In some cases, cashback sites can divert money earned into a child trust fund.

It is wise for parents to assess the child trust funds they are responsible for each year, as interest rates and charges can vary. Different products can be compared so parents can ensure their child’s money is always in the best hands.

Money cannot be withdrawn once it is paid in and access is only granted when the child turns 18. It is then up to them to decide what to do with the funds. If they want they can keep the money in an adult ISA and continue to save. Or the cash could be withdrawn and used to pay for university tuition fees or to buy a car.

Figures from HM Revenue & Customs show that 6,141 child trust funds were opened to April 5th 2012 for children born between September 1st 2002 and January 2nd 2011. Around half of these were opened by parents.

Although the scheme has now been closed to new accounts, parents who are already managing child trust funds for their children should continue to use them as an easily accessible and worthwhile investment tool. Contributions do not have to be for large amounts or made on a regular basis, and even small investments can add up over time. Once the child turns 18 the money could be very much appreciated and put to good use for the future.

End of Tax Year

Tax FreeThe end of the tax year is fast approaching and as everyone rushes to maximise their tax free savings first direct has compiled some tips to help negotiate the tricky waters.

  1. Get a grip on your finances – work out how much you have in savings, what rate of interest you’re receiving and whether you’re taking advantage of you tax free subscription.  If you don’t have any savings look at your budget to see if you could free up a monthly amount to start saving.
  2. Remember ‘Tax free’ means free from UK Income Tax and Capital Gains Tax
  3. Start small, don’t just open online current accounts, open a Cash ISA – in a recent first direct survey* nearly 50% said they didn’t have any tax free savings.  You don’t have to use your limit, but you might as well avoid paying tax on any savings you do have up to the Cash ISA limit.
  4. Use your limit if you can – In 2012/2013 the total ISA limit is £11,280 of which £5,640 can be put in a Cash ISA and anything you don’t put in your Cash ISA can go towards your Stocks and Shares ISA instead. Make sure you use your 2012/2013 tax year limit before the start of the new tax year on 6 April 2013 because after this date, this tax year’s subscription allowance will be gone for good.
  5. Don’t forget a Stocks and Shares ISA – recent research* by first direct found that only 14% of the population have a Stocks and Shares ISA, essentially missing out on between £5,640 and £11,280 of tax efficient allowance (2012/2013).  The benefit of a Stocks and Shares ISA is that all investors, including higher rate tax payers, won’t pay Income Tax. By investing in an ISA you are also protected from paying any Capital Gains Tax on any increases in the value of your investment.
  6. Budget for a higher allowance in 2013/2014 – the tax free allowance is going up to £11,520 (£5,760 for Cash ISAs in 2013/2014, so if you put a little aside every month consider increasing the amount so you can use your higher subscription allowance.
  7. Transfer your ISA to get a better rate – the survey* also highlighted that 62% have never transferred their ISA.  It’s important to get the most from your tax efficient savings and whilst you can only have one Cash ISA and one Stocks and Shares ISA per tax year you can transfer your ISA balances to another provider at any time.
  8. Keep all your eggs in one basket – every tax year you have a maximum Cash ISA subscription and you are allowed to transfer the previous tax year balance into your new Cash ISA.  If you can manage to fill your subscription each year the balance will soon add up allowing you access to the better Cash ISA rates e.g. first direct’s market leading 3% cash ISA rate (available for balances over £40,000 – just 7 years of cash free savings).
  9. Consider a UK Offset Mortgage – if you have a mortgage and savings then an offset mortgage might be a good option.  Any savings you have are offset against the balance of the mortgage and because they don’t receive credit interest they’re not subject to tax. For instance, if you have a mortgage of £100,000, savings of £20,000 and a 1st Account with a credit balance of £1,000, you only pay interest on £79,000. And as you don’t actually earn interest on your savings, there’s no tax to pay on them.

* Research carried out on behalf of first direct by Opinion Matters in February 2013 amongst 2,034 people aged 16+

The Cost Of Living The Celeb Life

Everyone has their own vice, but when you’re a celebrity, they are usually more expensive…and everyone seems to have an opinion about it!
Some people, while judging celebrities’ expensive lifestyles think it’s an absurd and pure ostentation, but until what point is it really?

Put yourself in their places and reflect, ; if you were a celebrity that makes enough money to cover your vices, wouldn’t you do the same?

Products as Personal Branding

Celebrities also get a lot of products just to be seen wearing it or even get it for modeling the product. Ashley Olsen who got the Louis Vuitton Urban Satchel for modeling for the product, and she’s not the only one, there’s plenty of others. A lot of celebrities buy it not only as an impulse buy or because of a vice but also as an investment, because they understand that they are ‘the product’ and that they HAVE to invest in the product to make more money. And of course, having limited edition products that cost a lot when you purchase it means that in the future it’s going to be worth so much more, so it’s a good investment both ways!

How much for the…

Handbags have always been the mother of every girl addiction, it’s a must have item for girls of every age, an item that every girl everywhere when asked, will always tell you that got her first one in their childhood. They are a great way to carry stuff and accessorize your look, so why not love it? Every woman probably has already experienced stars in their eyes when seeing the most beautiful handbag that they have ever seen. At that stage in time it’s a done deal; if the value is reasonable, the girl will put their time and effort to save money enough to buy it. When the price is completely outrageous, the bag’s worth will grow even more, and before they know it, every conversation will start with “I saw the most beautiful handbag’.

But when you are a celebrity, most of the times the dream become true, even if it is not something you have seen already, it’s just something you have thought or even dreamed about one night, like Lady Gaga ‘s Meat Handbag, Emma Watson’s Chanel Classic Diamond Forever Handbag price tagged $261,000 and Victoria Beckham Hermes Birkin Bag that cost $120,000.

It isn’t only female celebrities who spend a lot on their vices, celebrity men have been speding just as much, if not more than the women.

Men and their Motorcars

How can we expect that the male celebrities should sit at home and watch the football game while their female counterparts are out on the town spending money on fashion and fois grass. These guys have been working just as hard, and their innate need for anything that speeds, cannot be ignored.

Like Jerry Seinfeld’s sport Car Porsche 959 that costs $7000,000, Nicolas Cage’s Ferrari Enzo price tagged at $670,000 and David Beckham’s Custom Rolls-Royce Phantom Drophead price tagged $407,000.

Party Rockers in the House

Then there are habits that didn’t come with them since their childhood, these habits and hobbies were born in their teenage year. One of these status symbols is most defintely being the host of one of the biggest parties in Hollywood. As a celebrity host, nothing can be average when it comes cuisine, champagne and entertainment. Not all these real estate expenses are just for entertainment and display of wealth, but because these stars live their lives in the public eye, they make purchases focus on privacy as well.

Think in the lines of Private islands and mansions, a hidden place where they can go to escape the high life, the paparazzi, drama and bustle of their lives, but also, it’s an easy way for them to estabilish themselves as members of the high society.

Rihanna’s Pacific Palisades Mansion with 11,000 square-foot, 7 bedrooms, 9 bathrooms, 14-foot ceilings, a hot tub, swimming pool, sun deck and a 6,000-sq.ft. Garden is valued at over $12,000,000. Ozzy Osbourne’s Mansion with 10,953 square feet, 6 bedrooms, 10 bathrooms, swimming pool is worth $10,000,000 and Billy Joel’s Miami Beach Mansion with 303,310 square feet worth $35,000,000.

These are just a few things that celebrities like to spend their time and money on. “Lifestyles of the rich and the famous, their always complaing” as Good Charlotte would say, does not seem to be very far from the truth. One thing is for certain, if this had to be one of our lives, you wouldn’t hear us complaining.

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Having attained a formal education in Finance (Msc. in International Economics) Simon was inadvertently drawn towards finance blogs and extended successfully upon it by contributing to savings and family finances blogs as well. He is a long time contributor of the financial Blog of the UK short term loans provider Poundaccess, where you can read many of his writings.

What is a bond? Where Can I find the Best Rates?

Investing moneyWith the proper savings plan or with a fortunate monetary windfall, many people are ready to start out investing. Nevertheless, in the event you didn’t take any economics courses in high school or in school, you will not be familiar with the basics. Having seen the morning news for years, you’re most likely acquainted with phrases like stocks, bonds, commodities and Wall Street, however you won’t know exactly what they mean. Let’s take a better take a look at precisely what a bond is.

A bond is described as a debt security. Now, don’t let that time period confuse you, take into account it very like an I.O.U. If you put money into the bond market, what you’re doing is giving your cash to one thing, whether it’s a company, a government, a federal agency or a municipality that is known as a bond issuer. Now, what do you get in return for this act of faith? You get interest. Once you purchase the bond, you conform to obtain a particular interest rate from whoever you acquire it from, and then as soon as the bond “matures” you get often the face worth of the bond back.

The several types of bonds you’ll be able to choose from are fixed and varied.  There are additionally things like asset and mortgage backed securities bonds, bonds issued by overseas governments and plenty of other kinds.  There are a number of sites that can provide you great information on how to find the best rates with fixed rate bonds and other types.

BondsNow, bonds sound like a fairly good investment decision, it surely isn’t going to make you rich overnight.  Well that may be true but that doesn’t mean that bond investing is a bad thing. Consider investing in bonds as good lengthy-time period investment planning decision. Bonds are a unbelievable option to save for retirement. Bonds are also highly recommended to have as a part of your funding portfolio. Irrespective of how much risk you can take, it’s good to have a rock stable investment, and bonds are a good stable thing to fall back on.

Today’s bond market is assorted and there are alternatives for everybody, whether you’re just out of college or if you’re a Wall Street executive and you need an anchor to your portfolio. Investing in bonds could be a fun and educational method to begin investing, and you seemingly won’t lose your shirt in the process.  If you are looking to get into bond investing be sure to find Birmingham Midshires online.

Have you had experience with bond investing?

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6 Financial Emergencies and How to Deal With Them

Financial emergencies can strike anyone at any time. The best way to protect yourself is to have a sizable savings account, but this isn’t always possible. Here are some smart ways to handle sticky financial situations when you’re short of cash.

Visits to the Emergency Room

 Emergency Room

Image via Flickr by Rosser321

In 2009, the average cost of an emergency room visit was $960. When you have to visit the ER, go to a hospital within your insurance network when possible. If you’re uninsured or still face a large bill after your insurance has paid, call the hospital and ask about financial assistance programs. In many cases, they’ll offer a reduced sum or allow you to use a payment plan.

Job Loss

 Job Loss

Image via Flickr by Stephen Fulljames

Though unemployment has dropped overall in the past year, you never know when you might face a sudden job loss. If you’re without work, begin by filing for unemployment benefits if you’re eligible. Next, contact your lenders and tell them about your situation. You can defer some payments until you’re back on your feet. Reducing your living costs rapidly is your first line of defense while you search for another job.

Car Trouble

Car Toruble

Image via Flickr by Mark Cartwright

It’s estimated that as many as a third of all cars between the ages of three and 10 years will break down sometime over the next 12 months. If this happens to you, you need to find extra money fast. A savings account is your best option. If you don’t have enough in savings, try using a credit card or loan such as Arizona Payday Loans to get you through. Pay off what you’ve borrowed as soon as possible to reduce the overall cost.

Loss of Income from a Second Source

Natural Disasters

Image via Flickr by normanack

If you have a second job or earn income from a hobby such as selling on eBay, you’re in a tough spot when the money dries up. You’re not eligible for unemployment, so you have limited options. When you have a second source of income, it’s wise to save a significant part so you can get by if you lose this income stream. Look for creative ways to replace your second source and cut costs in the mean time.

Natural Disasters

Natural disasters

Image via Flickr by PhotoJunkie!

Natural disasters are something that you rarely see coming. Protect yourself by making sure you have good homeowners or renters insurance. When disaster hits, talk to your insurance provider right away. Look for disaster relief and special assistance programs to help you rebuild in the aftermath.

Household Repairs

Household Repairs

Image via Flickr by Kai Hendry

Ideally, you’ll always have a savings fund set aside for household repairs. If you can’t afford the cost of a new appliance or major repair, you should first consider whether it’s essential. You can live without a dishwasher while you save money for repairs, but you can’t manage without heat in winter. If you must have the repair done, shop around for the best price. Look for specials or coupons. Borrow the money or use a credit card when necessary.

Handling financial emergencies is never easy, but you can lower your losses by using smart tactics. Whenever possible, put extra funds into a savings account for just these kinds of situations.


Start an Emergency Fund to Prepare for Financial Emergencies

About the Author

Shaun Chatman is a well published author on many authority sites. He lives in Dunedin, FL, and spends his free time playing with his kids or advising friends on gadgets, travel and finance

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