Tax-Free Income: A Guide to Reducing Your Taxes Legally While Going Green (Part 2)

Tax-Free Income: A Guide to Reducing Your Taxes Legally While Going Green (Part 2)

Only you have the power to reduce your taxes! This is because you have to know which actions will result in the ability to write off a cost as an expense. You have to know enough about how to apply the tax code to your situation in order to use it to your benefit.

For example, you don’t have to know all of the rules of a 1031 exchange, just that you know what one is and when you might be able to take advantage of one.

 

Tax-Free Income_ A Guide to Reducing Your Taxes Legally While Going Green (Part 2)

Similarly, you don’t have to know the exact tax form you need to write off a recent home energy efficiency purchase (e.g.insulation). You just need to know that you can lower your tax burden and reduce your utility bill by adding insulation to your home.

In fact, adding adequate insulation is one of the most cost-effective home improvements that you perform on your property.

Tax Credit Amount: 10% of the cost, up to $500.

You can find plenty of ways to insulate your home at Eco Economic’s Sustainability Shop.

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You Are Your Own Bookkeeper:

 

To take advantage of this tax credit, all you have to do is keep track of the expense on a spreadsheet and give it to your tax accountant at the end of the year. You are your own bookkeeper, which can be a good or bad thing.

It’s great if you know which expenses to keep track of or terrible if you don’t know what you are doing.

If you don’t know what you are doing, the result will be that you will pay the most you can possibly pay in taxes.

 

Why You Need to Understand the Principles of the Tax Code:

 

The government uses incentives to get the free-market (entrepreneurs, homeowners, and investors like you and me) to focus on projects that it wants us to invest in, build, and/or fund.

The government wants people to “go green”, which is why they provide a 30% tax credit for installing solar panels and offer a credit of 10% of the cost, up to $500 for adding insulation to your home.

When we do want the government wants, the government rewards us with tax breaks!

Luckily, you don’t have to memorize all 2,600 pages of the tax code. You just need to understand the principles behind them.

Once you understand the tax code principles, you’ll know when you may be in a situation to write an expense off. When you get good at recognizing these kinds of situations, you will edit your actions so that you purposely take the path of putting yourself in more of these kinds of situations.

The saying, “You don’t know, what you don’t know” rings true in this situation.

If you spent time learning about the principles behind the tax code, then when you find yourself at a crossroad, you can ask your tax advisor how to navigate the situation to your advantage.

With the tax code principles in hand, you can apply this knowledge to your daily actions.

For example, you can write off meals with a business partner or a friend who consults in your industry.

You just have to write down:

  1. What you talked about
  2. Who you eat the meal with

 

Then you can write it off as a marketing or consulting expense.

The two areas that our government gives the most tax incentives are in the areas of owning a business and in real estate. This is because these two areas provide jobs, housing, products, and services.

 

 

Sustainable Business Practices: Upcycle, Recycle, and Downcycle

 

 

It is becoming an indisputable fact that the future of business prefers ESG companies.

The world’s economies are slowly moving from a linear to a circular economy. The main driver is due to the fact that the “old way of doing things” is just no longer a viable option.

The transition toward a circular economy has to occur because our linear economy of “make, use, and dispose” is unsustainable.

The goal of a circular economy is to use raw materials more efficiently, resulting in a reduction in waste. When a product reaches the end of its life, its materials are kept within the economy wherever possible. By doing this, we can continue to use the same materials over and over again.

In a circular economy, we would “make, use, and return”. Here is a great video by CNBC that quickly explains how a circular economy works.

 

Upcycling:

 

Upcycling, also known as creative reuse, is the process of transforming by-products, waste materials, useless, or unwanted products into new materials or products of better quality or for better environmental value.

In other words, upcycling is the process of converting old or discarded materials into something useful and often times more beautiful with more value.

Downcycling: 

 

Conversely, downcycling is a recycling practice that involves breaking an item down into its component elements or materials. Once the elements or materials are recovered, they are reused if possible. Usually, the reused materials are created into a lower-value product.

The main take away is that resources are limited because our planet does not have the capacity to produce an unlimited amount of natural raw materials.

For example, not only is the amount of copper in the ground is finite. But, pulling new copper out of the ground results in deforestation and the use of transportation fuel (which is bad for the environment and our Global Warming problem). Instead, it would be better for us to reuse the copper that is already in circulation.

 

 

Why We Need to Move to a Circular Economy:

 

The human population continues to grow at an incredibly fast rate. In fact, the UN reports that “roughly 83 million people are being added to the world’s population every year”.

The latest world population projections indicate that the global population will reach 10 billion people in the year 2055 and 11 billion in the year 2088.

To see a website dedicated to the global population growth visit worldometers.info. It is pretty scary to watch how many people are born every second and know that each one of those people needs to be fed, clothed, and bathed. Now imagine that each one of those people wants to buy a house, car, and iPhone.

 

 

How to Reduce Your Carbon Footprint While Increasing Your Income?

 

Eco Economics is devoted to helping you learn about personal finance while creating a more sustainable future.

Remember, saving is the core of investing. One way you can save money is by buying reusable and sustainable products. A second way to save is by insulating your home.

Start saving money today so that you can purchase income-producing assets to secure your financial future.

Becoming a minimalist will inherently help you save more money (because you are buying less). This, in turn, will allow you to invest more. The zero-waste lifestyle has many health and budget benefits.

Support sustainable businesses by buying products from and investing in companies that put the people and the planet first. Visit Eco Economic’s Sustainability Shop to get started on your path to a minimalist/zero-waste lifestyle!

How to View the Tax Code: 

 

By learning the tax code you can keep more of your hard earned money.

Think about your financial IQ, financial report card, and financial freedom like it is a game. Once you shift your perspective, you will love learning about how to win the Financial Freedom Game of Life.

Treat the tax code as if it were a treasure map. As you follow the map, your taxes will go down. In turn, you get to keep more of your money, which you will then re-invest to make more money!

The Financial Freedom Game of Life is exactly that… A Game, so use all of the tools you can to ensure that you have the best chances of winning.

Are you saving for retirement? Hopefully, the answer is yes. If it is “Great”!

Are you invested in mutual funds? Like a Target Date Fund?

If the answer to this is yes, you are likely paying too much in fees!

To quote Nerdwallet,

“A 1% Fee Could Cost $590,000 in retirement savings over 40 years.”

Want to learn more about how to create a diversified low-cost stock portfolio that will perform well in any market?  Want to reduce your taxes? Know the difference between tax incentives, credits, and deductibles? Interested in knowing how to tax defer indefinitely?

Sign up for the FREE Increase Your Financial IQ Email Course for more information on financial planning and wealth creation!

 

 

Be a Life Long Learner:

 

There are many ways to learn throughout life, all of which cost money, time, or a combination of both. Typically, there are 3 ways to learn. You can pay to learn a subject, ascertain knowledge from a mentor, or you can go through the-school-of-hard-knocks.

With a mentor, you are limited to the time that you are able to physically spend with them and you need to coordinate your schedules. Your mentor has their own life, so you will likely need to conform your schedule to theirs.

The difficult part with the “learn-as-you-go” through the trial-and-error method is that you may not know what you should have done instead.

More importantly, you cannot undo mistakes (you can only learn from them because the damage is already done). Typically, there is a cost for fixing a mistake, whether it be a monetary or time cost.

Another result of the “learn-as-you-go” through the trial-and-error method is that you will constantly get blindsided by obstacles and have serious feelings of uncertainty.

 

 

The Increase Your Financial IQ Course: 

 

 

For some strange reason, high schools don’t give you the tools to prepare you to face the world of finance. I got my B.S. in International Business and a Master’s of Business Administration.

After all of that schooling, none of the accredited curriculums taught about how to master your personal finances.

What did they teach instead?

How to manage finances for a company i.e. balance sheet, income statement, calculate the time value of money.

Everything was geared toward helping a company, and none of it was focused on how I can create the best financial springboard for myself.

Luckily, I have been passionate about wealth management since I was 19. This passion led me to read and listen to books written about investments, personal finance, retirement funds, estate planning, and taxes.

I was further shocked by the fact that none of these books have taken the topic of personal finance full circle. This is the reason why I became so passionate about creating a course that teaches personal finance from many angles and about the many subjects within the realm of personal finance.

What the Course Covers:

 

The first course that I will be releasing (soon) is called the “Increase Your Financial IQ Course”. It will cover the following topics:

  • Starting small by having $1,000 in savings
  • Budgeting (The 50%, 30%, 20% rule)
  • 5 methods of debt payment
  • Managing your credit
  • Roth/Regular IRA’s and 401k’s
  • How to create a diversified stock portfolio (ETFs)
  • A macro view of the economy (the Federal Reserve)
  • Purchasing your first home (the process, down payment assistance plans, PMI, etc.)
  • How to save for your children’s college fund (529 plan, Education IRA, UTMA/UGMA)
  • Long term care insurance

 

 

How to Get the Most from the Courses:

 

The first 3 sections from “saving $1,000 to the 5 methods of debt payment” will be covered rather quickly. Basically, saving is the core of investing. You have to learn how to prioritize every dollar.

If you want to save more money, you’ll have to either earn more or get creative and find lower-cost substitutes. If you make $1 million and spend $1 million you are still living month-to-month. You have to learn how to live below your means.

This being said, more attention will be paid toward the sections discussing “credit to long term care” (the modules will be longer with more in-depth content).

While my goal is to help you understand finance, I really want to help those who truly desire to attain Financial Freedom. To attain this goal, you have to have personal restraint and discipline.

 

 

Why I am Creating These Courses:

 

The Increase Your Financial IQ Course is designed for the person “renting a home and living month-to-month”, and getting them into a position where they can save enough to invest in income-producing assets and purchase a home.

The Financial Freedom Course is designed to help take you from owning a home to purchasing investment properties and focuses on tax-advantaged strategies of wealth creation.

The ultimate goal is for you to make enough passive income to quit your day job.

If you are interested in either of these courses, sign up for the FREE Increase Your Financial IQ Email Course for more information on sustainable financial planning and wealth creation! By signing up, you will be the first to know when my Increase Your Financial IQ Course becomes available.

 

Like what you see? Stay a while!

 

 

If you have learned anything new, please remember to share so that I can continue to provide you with more free content!

Feedback is always welcome, so feel free to comment below!

 

How to Invest in Socially Responsible Companies while Timing the Market

How to Invest in Socially Responsible Companies while Timing the Market

“How to time the market?”, is an age-old question. In this article, I will go over how you can use market indicators to decide where we are in the economic cycle and how to create a balanced portfolio. First, I’ll talk about how to invest in the market and when. Then, I will talk about how you can use this information to create an impactful investment portfolio by investing in sustainable and ESG companies.

How to invest in socially responsible companies while timing the market

Technology has enabled people, like you, to invest in small quantities resulting in:

  • Millions of new stock owners with sustainable ideals that companies cannot afford to ignore
  • The ability to diversify
  • A reduction in overall cost associated with investing (fees)

I’ll show you how you can diversify your portfolio while making a positive impact on the environment by supporting companies that help solve the world’s biggest challenges.  It is about putting your dollars to work by buying products from and investing in companies that put the people and the planet first.

In my post called, “Sustainable Investing: How to Diversify and Perform Well in Any Market” I talk about using the business boom and bust cycle to think critically about which sectors of industry will perform well and why.

For example, consumer staples, health care, and utilities tend to do well or at least hold their value in recessionary times.

Why? Because you need to buy groceries, go to the doctor if you get sick, and turn your lights on at night… You will do these things, even when the market is down.

There are two kinds of mentalities when it comes to investing. You are either a Momentum or Contrarian buyer.

Not sure which one you are? Read “Investing Strategies: Contrarian Versus The Crowd Consensus”.

Once you have a good idea of whether you are a momentum or contrarian buyer, you can use the following two indicators to help you make purchasing decisions. In the Increase Your Financial IQ Course, I go over several other market indicators, but for now, these two will provide a great start.

 

 

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1. The Fear and Greed Index (Consumer Sentiment):

 

Consumer sentiment is “how the public feels” about the current state of the economy. One useful metric is to use CNN’s Fear and Greed Index, which is calculated daily.

 

CNN fear and greed index

Photo Credit: CNN Money

 

 

The Fear and Greed index is composed of the following 7 economic indicators:

CNN fear and greed index

Photo credit: CNN Fear and Greed index

 

 

 

2. The Federal Reserve:

 

 

I like to go straight to the source. What better way to see where the market is going than to watch a 45-minute recap of the Federal Reserve Open Meetings (FOMC)!

The Federal Reserve is the entity that sets the monetary policy and tone of the economy. They meet 8 times a year, and their full-time job is to think about the US economy.

One serious indicator is whether the Fed is raising or lowering interest rates.

Why should you pay attention to interest rates? 

When the Fed wants to get the economy out a recession it will lower interest rates to spur lending. This allows businesses to borrow, buy equipment, and hire people.

Conversely, when the economy heats up too quickly, the Fed will raise the interest rate to slow it down. When businesses and individuals borrow too heavily, they become over-leveraged. Their debt-to-income ratio gets too high, and the rate at which people default on loans go up.

This, in turn, can lead to a domino effect…Where one person’s missed payment is someone else’s income, which causes that next person to miss their payment.

When people become over-leveraged, it means that they do not have enough equity (cash or liquidity) to cover their debt obligations (payments).

Interest rates are just 1 of 3 major powers that the Federal Reserve has to help stabilize the economy. I go into a ton of detail about this subject in the Increase Your Financial IQ Course (coming soon)! 

Remember, economic reports like the Fear and Greed Index, GDP, and employment rates are statistics that tell us about the current and past state of the economy. It is telling you how the economy has recently performed.

Indicators like the Federal Reserve changing the interest rate reflects how the economy is doing and is a more forward indicator. The Federal Reserve will adjust interest rates based on its analysis of where the economy is and what the future looks like.  

 

 

Owning a Mix of Offensive and Defensive Stocks

 

 

It is important to compose a portfolio that has both offensive and defensive stock so that you can be prepared for a fluctuating market.

Let’s take a look at what offensive and defensive stocks look like…

 

A Few Examples of Offensive Stocks are:

  • Financials (banks, lending companies, etc.)
  • Homes (home builders, Home Depot, machine/equipment to build or remodel, etc.)
  • Technology (consumer technology)
  • Consumer discretionary goods (cars, luxury goods, etc.)

 

These kinds of stock do well when the public has confidence in the market. On the other hand, in recessionary times, people tend to tighten their belts and not purchase luxury goods.

A rule of thumb is to think of offensive stocks as ones that tend to experience greater fluctuations during economic booms and bust cycles.

 

A Few Examples of Defensive Stocks are:

  • Utilities
  • Health care
  • Blue chip
  • Commodities
  • Grocery stores

 

These kinds of stocks are more reliable and aren’t as heavily impacted by the market.

For example: If economic times are good, you probably aren’t going to start leaving all of your lights on, buying 3x more groceries, and getting surgeries that you don’t need. Conversely, if economic times are bad you aren’t going to stop going to the grocery store or taking your medication.

One way that can help you decide whether a stock is a defensive or offensive purchase is by looking at its Beta.

Often times the Beta can help you decide when to invest in a stock (Sector Investing).

So what is Beta you ask?

 

Beta:

 

Think of the number 1 as being equal to the “markets performance”, and a company’s Beta is always in relation to the market.

Beta is a number between 0 and 2. I suppose you could have a Beta that is higher than 2, but that just means that the stock is 2x as volatile as the market.

If a stock has a greater than 1 Beta, it typically means that the stock will do really well in good times. Conversely, a stock with a greater than 1 Beta will suffer more in bad times. Just equate a large Beta with more volatility.

For example, KB Homes (a new home builder) has a 1.47 Beta. Note that, the Beta can change depending on the stocks perceived volatility.

Photo credit: Yahoo Finance (please note that stock prices are always changing)

 

If a stock has a lower than 1 Beta, then the stock will tend to hold its value. Economic hard times won’t have a massive negative effect, but the stock won’t rally in a meaningful way in economic good times either.

Now, let’s talk about how you can use this information to create an impactful investment portfolio by purchasing in sustainable and ESG companies.

 

A Case for Including ESG Companies in Your portfolio:

 

A study published by Taylor & Francis Online combined findings from 2,200 individual studies and concluded that “the business case for ESG investing is empirically very well founded.”

This means that after studying and combining all of the research from several thousands of studies, the authors found that investing in companies that care about its social and environmental impact is financially practical.

The old line of thinking used to stand that, “You can either make a profit or do good”. That you could only accomplish one or the other. This study shows that this is no longer the case.

Agencies like MSCI perform reviews of ESG funds and assign them a rating called an “ESG Quality Score”.

Since its founding in 2006, the United Nations Principles for Responsible Investing (PRI) has attracted over USD $68 trillion in assets under management as of April 2017.

In a prior article, I list 5 great ESG ETF Funds that you can invest in that will allow you to support companies that “Do Good”. Eco Economics is about helping you support these kinds of companies.

You can make a difference in two ways:

  1. Buying natural, reusable, and zero waste products from Eco Economic’s Sustainability Shop
  2. Taking ownership in ESG companies through the purchase of their stock

Owning stock in a company helps the company by raising money to invest in R&D and buy equipment to produce more products.

 

 

Why should we invest in a Low Carbon ETF?

 

 

Here is a TED talk by Bill Gates on how we can solve the Global Warming issue. We have to solve this issue and fast! After all, it is our lives at stake.

 

 

 

The Take Away:

 

In sum, it is not about selling stocks on Wednesday and planning to buy them back on the following Monday. Smart investing is based on long-term (patient) investing in companies with strong fundamentals. Moreover, it’s about properly diversifying your portfolio. If you are investing in ETF’s consider manually dollar cost averaging.

Are you interested in increasing your knowledge of personal finance and want to learn about how you can live a more sustainable lifestyle? Sign up for the FREE Increase Your Financial IQ Email Course for more information on sustainable financial planning and wealth creation!

To quote a Forbes Article,

“The success rate for day traders is estimated to be around only 10%, so … 90% are losing money.” 

Similarly, the article quotes Cory Michael’s (Vantage Point Trading) even more pessimistic view. He says,

” Only 1% of [day] traders really make money.” 

So how can you start saving money today so that you can increase your investment portfolio?

Become minimalist, which will inherently help you save more money. This, in turn, will allow you to invest more. The zero-waste lifestyle has many health and budget benefits.

Eco Economics was created to help you learn about personal finance while creating a more sustainable future. 

Support sustainable businesses by buying products from and investing in companies that put the people and the planet first. Visit Eco Economic’s the Sustainability Shop to get started on your path to a minimalist/zero-waste lifestyle!

 

 

Like what you see? Stay a while!

 

If you have learned anything new, please remember to share so that I can continue to provide you with more free content!

Do you invest in an ESG company? If so, which one? Feedback is always welcome, so feel free to comment below!

 

 

Tax-Free Income: A Guide to Reducing Your Taxes Legally (Part 1)

Tax-Free Income: A Guide to Reducing Your Taxes Legally (Part 1)

The government uses incentives to get people to do what they want them to do. For example, if the government wants more affordable housing, then it will provide some great incentive to get you (an investor) or developers to invest in affordable housing.

My goal is to get you to have a different perspective on taxes. I want you to start seeing taxes as our government’s way of incentivizing people to help them accomplish their economic and social agendas through tax breaks.

How to reduce your taxes legally

Over the next several posts, I will be writing a guide on how to lower your taxes permanently and the legal way! Currently, I am creating the “Increase Your Financial IQ Course” and am now adding on to create the “Financial Freedom Course”. 

 

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Who Receives the Most Tax Breaks?

 

Business owners and investors receive tax breaks because they provide jobs, housing, products, and services.

Starting your own business can be risky, as only 1 out of 10 make it. This is why the government gives incentives to entrepreneurs so that the model of, “with greater risk, comes greater reward” motivates people to take chances. 

In a prior post, I write about how there are 3 streams of income (earned, passive, and portfolio).

Earned income is taxed at the highest tax rates, while passive and portfolio income is taxed at capital gains rates. 

The reason why you pay less in taxes on investments (passive and portfolio income), is because you have already paid earned income taxes on this money. You needed to earn the money prior to being able to invest it. 

Moreover, when you invest in real estate or a company (through the purchase of a company’s stock) you are supporting the economy.

You will see that the two areas that the government gives the most incentives are in the area of owning a business and in real estate. This is because they want you (private industry and entrepreneurs) to employ and house the public.

Why? So they don’t have to do it…

Because we live in a free-market and semi-capitalist society. I say that we live in a semi-capitalist society because the government does intervene with stimulus packages, subsidies, and tax breaks.

If the government did all of the employment and housing of the public… Then, by definition, we would live in a communist economic model. History has taught us that the communistic model is not truly equal and is one of the most wasteful and inefficient uses of time and natural resources.

 

Tax-Free

 

 

How to Reduce your Taxes Through Real Estate and Owning Stock

 

 

A Private Residence:

 

 

When you purchase a home, you typically need to take out a loan. This loan is generated by a mortgage lending officer. You probably used the help of a real estate agent, who also gets paid. Then, you purchase furniture for your new home and hire a handyman to make a few improvements. Suddenly, your kitchen faucet springs a leak and you decide that you want to plant an edible organic carbon sequestering garden. This requires you to run to the nearest home improvement store to buy maintenance and gardening tools.

Please note, there is no “income or cash flow” because you are living in the home. Your tax incentive in this situation is that you get to write off the interest that you pay on the mortgage of your home.

The government wants you to own your own home because owners take better care of their properties. This, in turn, increases the curb appeal and boosts the neighborhood appeal. Moreover, homeowners support local handymen, contractors, and electricians.

What’s more is that you likely had to save enough money for a downpayment, meaning that you are making enough money so that the government isn’t having to support or provide you with low-income housing.

 

 

An Investment Property:

 

When you purchase a rental property, you basically help the economy in all of the same ways that you help it by buying a personal residence… You most likely provided income to a lender by taking out a loan and generated revenue for a bank. Used the help of a real estate agent, appraiser, and purchased a home inspection. Except for this time, you are providing housing.

 

Tax Breaks for Rental Properties:

 

You can deduct the following expense…

  • Mortgage interest payments on loans used to acquire or improve rental property
  • Interest on credit cards for goods or services used in rental activity
  • Depreciate a portion of the cost of the property over several years (27.5 years for residential property)
  • The cost to repair the rental property
  • Pass-through tax deduction
  • Travel to check up on your rental or to provide/meet a maintenance person
  • Home office (write off a portion of your primary residence that is used as a home office)
  • Employees and independent contractors
  • Legal and professional services

To stay within the law (and avoid unwanted attention from the IRS), you need to properly document your long distance travel and other write-off expenses that you deduct.

The Financial Freedom Course will discuss this in greater detail.

 

 

Owning Stock in a Company:

 

Most tax breaks are given to business owners. That being said, you can take advantage of being a business owner while not having to start your own business. The Financial Freedom Course will go into greater detail about the many different tax write-offs you can claim when you own your own company.

By owning stock in a company, you get to pay capital gains tax (15%-20%) on any dividends you receive or on the profits when you sell your shares.

Moreover, should you need to liquidate your shares and happen to lose money from the sale of your stock, you can roll the losses forward to the next tax year. This means that you can offset your gains (up to $3,000), and roll any residual losses to be applied to the following year.

One of my favorite books is by Tom Wheelwright, who is the author of Tax-Free Wealth. In his book, he helps you learn tax planning concepts in simple to understand terms.

He teaches you how to use your country’s tax laws to your benefit. Tom Wheelwright tells you how the tax laws work, and how they are designed to reduce your taxes, not to increase them.

 

 

 

Tax Free Wealth

 

 

This guide has been written and is to be used as general information. This is not professional or financial advice that is specific to you. In other words, I am not A CPA or lawyer and the opinions/representations on this site are my own.

While I have a B.S. in International Business and an MBA with an Emphasis in Renewable Technology, I am not providing financial or legal advice that is specific to any one person.

 

 

The Take Away:

 

 

The government uses incentives to get the free-market (entrepreneurs and investors like you and me) to focus on projects that it wants them to invest in, build, and/or fund. When we do want the government wants, the government rewards us with tax breaks!

By learning the tax code you can make more money, or at the very least, reduce your tax liability.

Think about your financial IQ, your financial report card, and your financial freedom like it is a game. Once you shift your perspective, you will love learning about how to win the Financial Freedom Game of Life.

One of the keys to building massive wealth is by permanently lowering your taxes. Economic policymakers know that the public responds to tax incentives, which is why they have created them. 

Taxes are apart of everyone’s life, and they are here to stay. Instead of complaining about them, use them to your benefit!

Treat the tax law as if it were a treasure map. As you follow the map, your taxes will go down. In turn, your profits and return on investment will increase.

The Financial Freedom Game of Life is exactly that… A Game, so use all of the tools you can to ensure that you have the best chances of winning.

By learning the rules you will start to enjoy the game and the treasure hunt. Especially when you start to see your wealth accumulate. 

 

 

Be a Life-Long Learner: 

 

 

Want to learn about how you can grow your retirement account by investing in commodities and skip paying the 28% capital gains tax legally? Read my prior article called, “Tax-Free Money: The Secret of Buying Gold Inside of a Roth IRA”

So how can you start saving money today?

Become minimalist, which will inherently help you save more money. This, in turn, will allow you to invest more. The zero-waste lifestyle has many health and budget benefits.

Eco Economics was created to help you learn more about personal finance while creating a more sustainable future. 

Support sustainable businesses by buying products from and investing in companies that put the people and the planet first. Visit Eco Economic’s the Sustainability Shop to get started on your path to a minimalist/zero-waste lifestyle!

Want to learn more about how to reduce your taxes? Know the difference between tax incentives, credits, and deductibles? Interested in knowing how to tax defer indefinitely? 

Sign up for the FREE Increase Your Financial IQ Email Course for more information on financial planning and wealth creation!

 

Like what you see? Stay a while!

 

If you have learned anything new, please remember to share so that I can continue to provide you with more free content!

Feedback is always welcome, so feel free to comment below!

Sustainable Investing: How to Diversify and Perform Well in Any Market

Sustainable Investing: How to Diversify and Perform Well in Any Market

Both global institutions and individuals alike are taking a sustainable approach to pursuing their investment goals. The thought used to be that you could only accomplish one goal (sustainability or profit) at a time.

Today, statistics reveal that you can achieve diversification through the purchase of ETFs that specialize in Socially Responsible Investing (SRI). Through SRI you can help create a more sustainable future and develop a portfolio that will perform well in any market.

 

A common debate with SRI investing revolves around the idea that incorporating socially responsible factors into the investment process will hurt overall performance.

However, some studies suggest that companies with ESG practices displayed a lower cost of capital, lower volatility, and fewer instances of bribery, corruption, and fraud.

On the other hand, studies show that companies that perform poorly on ESG have a higher associated cost (in the long run). These costs are linked with an increase of capital, higher volatility due to controversies, and other damaging incidences. 

Companies that do not create contingency plans or mitigate risks face massive PR backlash from spills, labor strikes, fraud, accounting, and other governance irregularities.

 

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Diversification:

 

Diversification is a risk management technique that mixes a wide variety of investments within a portfolio.

The rationale behind this technique is that a portfolio that contains uncorrelated investments will have a higher return. This is because stocks that are uncorrelated move in different directions during different times of the economic boom/bust cycle.

In laymen’s terms, “not having all of your eggs in one basket”. 

By purchasing stocks that are different from each other (whether by company size, industry, sector, country, etc), you are spreading out your risk.

Diversification)

 

 

 

Making a Positive Impact by Investing in Socially Responsible Funds:

 

 

One way to diversify is to invest in socially responsible companies through ETFs. In the money management world, Socially Responsible Investing (SRI) is also known as ESG (environmental, social, and governance) funds.

You can make an impact today by investing in sustainable companies that help solve the world’s biggest challenges.  It is about putting your dollars to work by buying products from and investing in companies that put the people and the planet first.

In a prior article, called “New Year’s Resolutions to Create a Sustainable 2019“, I write about how UN scientists have recently released a warning. In their statement, the UN gives the world less than 15 years to reduce the carbon output to nearly 0 or else face serious climate change consequences. 

What’s really scary to think about is that three-quarters of the world’s mega-cities are by the ocean. Just imagine the level of geopolitical instability that would occur should billions of people need to relocate due to rising sea levels.

According to the UN, 2.4 billion people (40% of the world’s population) live within 60 miles of the coast. To give you a comparison, the recent instability in Syria has displaced 13 million people.

Ask yourself, what would happen should 1 billion people need to find new homes. I am not an alarmist, I just want you to know the facts.

So what can you do? Become minimalist, which will inherently help you save more money. This, in turn, will allow you to invest more. The zero-waste lifestyle has many health and budget benefits.

Support sustainable businesses by buying products from and investing in companies that put the people and the planet first. 

Check out Eco Economic’s Sustainability Shop to find nifty swaps for plastic/disposable items with more sustainable alternatives.

 

 

Sector investing: Using the Business Cycle

 

I am sure you know that the economy goes through economic cycles. These ups and downs in the economy are called boom and bust cycles or bull/bear markets.

So if you know that these cycles exist, then it makes sense to study which sectors of the market do well in each phase of the cycle.

The photo below, provided by mrshearingeconomics, is a great depiction of how our economy expands and contracts to grow over time.

economic cycles

Early-cycle Phase:

 

Sectors that typically benefit the most are ones that thrive due to a reduction in interest rates.

Interest rates are set by the Federal Reserve, which meets 8 times per year. A reduction in interest rates spurs the economy because it incentivizes companies to borrow/take out loans. 

The industries that benefit first are:

  • Financials
  • Capital goods
  • Transportation
  • Raw materials (aluminum/copper)
  • Consumer discretionary

Mid-cycle Phase: 

 

The mid-cycle phase is characterized by a positive but more moderate growth rate than the early-growth phase. Typically, the mid-cycle phase is the longest phase of the business cycle. 

The industries that benefit the most from this phase are: 

  • Information technology (Nasdaq)
  • Real estate
  • Industrial
  • Raw materials
  • Transportation
  • Manufacturing

Late-cycle phase:

 

In this stage of the business cycle, the economy has “overheated” and will soon slip into a recession. There is a tightening of credit availability and corporate profit margins begin to deteriorate. Unfortunately, consumers and businesses become overleveraged and begin to miss loan payments.  Moreover, company inventory levels become too high, and not enough of their products are selling to continue the growth curve trajectory. 

The industries that benefit the most from this phase are: 

  • Energy 
  • Health care
  • Consumer staples
  • Utilities

The Recession Phase:

 

Often, this phase is marked by a contraction in economic activity. Corporate profits decline and credit is scarce. At this time, the Federal Reserve eases the monetary policy by lowering interest rates to stimulate the economy. Companies offer sales and coupled with a decrease in manufacturing, inventories gradually fall. Consequently, these actions set the stage up for the next recovery.

The industries that benefit the most from this phase are: 

  • Consumer staples
  • Utilities
  • Telecommunication services
  • Health care

Here is a quick video by You Will Love Economics, that explains how the business cycle works.

The Take Away:

 

Diversification is critical to lowering your portfolio’s risk. Simultaneously, by diversifying you can own enough of the market to maximize your gain. Moreover, it gives you the best opportunity to do well no matter what stage the business cycle is in. 

After building an emergency fund, investing for your retirement through a Roth IRA or 401k is the most important financial step you can make to ensuring that you can retire comfortably.

Want to learn how you can grow your retirement account by investing in commodities and skip paying the 28% capital gains tax legally? Read my prior article called, “Tax-Free Money: The Secret of Buying Gold Inside of a Roth IRA”

Striving toward a more sustainable lifestyle is one goal that has budget, environment, and health benefits. Don’t forget to check out the Sustainability Shop to get started on your path to a minimalist/zero-waste lifestyle!

Want to learn more about sector investing? Why each sector benefits from its correlated phase of the business cycle? And how to use the business cycle, and which segments to invest in and when?

The Increase Your Financial IQ Course will take a deeper dive into creating a personalized financial plan that will help you feel confident in your future. This course will cover other wealth building strategies in more detail, but for now, sign up for the FREE Increase Your Financial IQ Email Course for more information on financial planning and wealth creation!

Like what you see? Stay a while!

 

Be the catalyst that helps create a bright and sustainable future. If you have learned anything new, please remember to share so that I can continue to provide you with more free content!

Feedback is always welcome, so feel free to comment below! What’s your favorite sustainable brand? 

 

Financial Freedom: Investing in Sustainable Companies

Financial Freedom: Investing in Sustainable Companies

How can you make a difference? You can make the biggest impact by investing in sustainable companies that help solve the world’s biggest challenges.  It is about putting your dollars to work by buying products from and investing in companies that put the people and the planet first. Together we can create the momentum to encourage others to step up to the plate too.

 

Invest in sustainable companies

A new and more diverse generation of investors are seeking sustainable solutions for their investment portfolios. The Millenial and Z Generations have greater access to the investment market. Moreover, the cost to enter the market has never been lower.

This lower barrier to entry means that you can invest with tens of dollars, instead of having to set aside thousands just to get started. The result, millions of new stock owners with sustainable ideals that companies cannot afford to ignore.

 

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Socially Responsible Investing:

 

 

Socially responsible investing is known in the investment and ETF world as ESG (environmental, social, and governance) funds. More importantly, new sustainable ESG ETFs are cropping up and industry professionals are taking notice.

This is because investors, like you, are concerned with the future of the planet and the treatment of company employees. The public is beginning to speaking out and companies are having to adapt to their demands.

How can you join this movement? By supporting companies through the purchase of ESG stocks.

One of the greatest benefits of investing through an ETF is that you are able to diversify and own a wide range of EGS company stocks.

Both global institutions and individuals alike are taking a sustainable approach to pursuing their investment goals.

The thought used to be that you could only accomplish one goal (sustainability or profit) at a time. Today, statistics reveal that you can achieve both.

 

Benefits of Investing in Sustainable/Socially Responsible Companies:

 

According to investopedia.com, here are a few statistics on investing in socially responsible companies:

  • In 2016, ESG made up over 20% of the $40 trillion money management market
  • Companies that deploy ESG strategies tend to show higher return potential and are valued at a premium when compared to their peers
  • Companies with higher ESG ratings tend to show higher profitability and dividend yield
  • Most corporate executives believe that a sustainable strategy is needed to remain competitive

These statistics show that you can have “your cake and eat it”. There is a way to support socially responsible companies while growing your net worth.

 

 

ETF’s Create A Low Barrier to Entry: 

 

 

Millennials are attracted to ETFs because of their price. For an annual fee, some as low as 0.04%, you can invest in hundreds of the top companies through an ETF.

The average ETF has an expense ratio of 0.44%. While the expense ratio for a mutual fund is falling, some actively managed funds can charge fees as high as 2.5%.   

Millennial investors’ love of doing their own research. Likely, this means that you want to be actively involved with the investment process.

There are a number of ways to incorporate sustainable investing into your portfolio.

 

Environmentally Friendly Socially Responsible ETF’s:

 

 

Vanguard:

 

Jack C Bogle, the father of the ETF and creator of Vanguard, created a company that is arguably the king of low-fee fund offerings. Estimates for fees of U.S. funds are 87% lower than other funds with similar holdings. Likewise,  estimates for international fund fees are 85% lower than traditional mutual fund offerings.

Vanguard recently launched two ESG ETFs. If you own a retirement account with Vanguard, like a Roth IRA, you can trade an unlimited number of their funds without paying a commission.

Typically, brokerages charge a flat dollar amount per trade e.g. Etrade charges $6.95 per trade (price checked on the day of this writing).

Vanguard’s ESG US Stock ETF ticker symbol is ESGV,  while its ESG International Stock ETF ticker is VSGX.  The expense ratio fees are 0.12% and 0.15%, respectively.

The funds incorporate elements of Socially Responsible Investing (“SRI”) by excluding certain “sin stocks”. Companies, such as those in the adult entertainment, alcohol, tobacco, fossil-fuel, and weapons industries are not included in the fund’s holdings.

From there, the funds apply an ESG overlay to the stock portfolios. The fund also attempts to maximize the United Nations Sustainable Development Goals in its investment decisions.

 

 

iShares:

 

Another company that is offering ESG  ETFs is called ishares.

This company evaluates and selects companies based on their commitments to positive environmental, social, and governance business practices. All iShares ESG funds screen out stocks involved in firearms, controversial weapons, and tobacco.

ishares has Thematic portfolios that focus on a particular E, S, or G issue. For example, clean energy or the diversity of a company’s workforce.

A few funds are specifically focused on investing in companies that have a low carbon impact. For example:

 

 

The iShares MSCI Global Impact ETF (MPCT) tracks an index of companies that “derive a majority of their revenue from products and services that address at least one of the world’s major social and environmental challenges as identified by the United Nations Sustainable Development Goals.”

 

 

 

The Take Away:

 

 

Today, investors have few excuses to avoid the inclusion of responsible investment holdings in their portfolios.

Evolving government policies are prompting large institutions around the world to put capital towards sustainable investments.

Moreover, investors like you are seeking sustainable investment solutions. The need for sustainable growth and investor’s desires to fund ethical companies has caused businesses to evolve for the better.

You can create an impact on how companies operate, by owning their shares. So get out there and be the change that you want to see in the world.

Want to learn more about how to save money by going green? Creating a diversified ESG portfolio?

The Increase Your Financial IQ Course will take a deeper dive into creating a personalized financial plan that will help you feel confident in your future. This course will cover other wealth building strategies in more detail, but for now, sign up for the FREE Increase Your Financial IQ Email Course for more information on financial planning and wealth creation!

 

Like what you see? Stay a while!

 

 

Be a part of the catalyst toward creating a bright and sustainable future. If you have learned anything new, please remember to share so that I can continue to provide you with more free content!

Feedback is always welcome, so feel free to comment below.

Sustainable Living: DIY Earth Friendly Hand Cream

Sustainable Living: DIY Earth Friendly Hand Cream

If you are like me, I always struggle when it comes to buying thoughtful and sustainable gifts for birthdays and holidays!

Sustainable living has become a topic that I think about throughout my day. As you’re making your way through a more minimalist, zero-waste lifestyle, one of the essential steps, is to swap out the plastic/disposable items with more sustainable alternatives. This is where making beauty products for yourself and friends can really come in handy!

One of the greatest benefits of making your own lotions, lip balms, and hair salves, is that you can save a ton of money, use higher quality products, and reuse your containers over and over again. My goal here at Eco Economics is to show you how to save thousands of dollars by going green and how to reinvest those savings into financial vehicles that will help you gain your financial freedom.

 

The Perfect Home Made Gift:

 

Winter always makes my hands dry and chapped. So it’s time to make my favorite super rich & creamy dry hand lotion.  My friends and I love this stuff!

When I make a batch, I usually make several bottles all at once. This is because:

  • I purchase in bulk to save money and the earth from additional packaging.
  • Reduces the number of times I have to make the lotion. Meaning fewer times I have to clean up.
  • I have an inventory of lotion so that I don’t run out. This also means that I can give some away as thank you or birthday gifts.

Having an inventory of homemade gifts makes gift-giving super convenient. I try my best to remember, but there are times when we all forget that special someone’s birthday.  Luckily, by having a few extra lotions laying around, I have prepared for such a situation. I can easily run home and grab one of my homemade creamy lotions.  Bang! You have a thoughtful, inexpensive, and personal gift ready to go!

 

Sustainable Living: Handmade Organic Lotions Over the Store-Bought Kind

 

I have a rule. If I can’t pronounce what is in the box or bottle, it doesn’t belong in or on my body. The best thing about making your own is that you know exactly what you are putting in your lotion!

Take a quick look at the ingredients in the lotions, shampoos, and conditioners in your bathroom. Most likely, they have an ingredient label calked full of stuff that you can pronounce!

For example, I looked up the ingredients for Nivea lotion. According to the company’s website, the ingredients are:

 

Aqua, Paraffinum Liquidum, Cera Microcristallina, Glycerin, LanolinAlcohol(Eucerit®), Paraffin, Panthenol, Magnesium Sulfate, Decyl Oleate, Octyldodecanol, Aluminum Stearates, Citric Acid, Magnesium Stearate, Limonene, Geraniol, Hydroxycitronellal, Linalool, Citronellol, Benzyl Benzoate, Cinnamyl Alcohol, Parfum.

I am not a chemist. But maybe you are, so you know where all of those ingredients come from and what they are. In the case that you aren’t a chemist, like me, I know that I feel so much better when I know exactly what I am rubbing all over my body.

Tired of paying $10 or more for 8 ounces of luxury lotion? You can make ten times 8 ounces for under $10 and have a much higher quality product… If you make it yourself.

 

 

Here’s what you’ll need to make this Rich & Creamy Sustainable Hand Lotion

 

1. Shea Butter

 

The Why: This raw organic Shea butter is a godsend when it comes to dry skin and hair. It is rich in vitamins A, E, F, and K. Moreover, it has natural fatty acids, which provide the building blocks to make prostaglandins. An agent that decrease inflammation in the body.

Fatty acids have many functions in the body and play a role in:

  • oxygen transport
  • development of strong tissues and organs
  • healthy looking skin
  • immune system health

 

 

Eco Benefits: Shea butter is one of the world’s most sustainable natural resources. Shea trees grow naturally in the grasslands of West and Central Africa and do not need any irrigation, fertilizer, or pesticides.

Health Benefits: Vitamins in the Shea butter have soothing and hydrating properties. This means that it promotes healthy skin collagen, and prevents premature wrinkles. 

 

 

2. Beeswax

 

The Why: This is my favorite beeswax because it has been triple filtered under strict organic USDA guidelines and was created naturally by healthy honeybees in a NON-GMO, pesticide-free environment!

Eco Benefits: Bees, honey, and wax are incredibly beneficial to the environment. Not only do bees pollinate your food crops, but you can use almost all of their by-products.

Health benefits: Beeswax locks in moisture and can help keep your skin feeling firm and plump. Another benefit is that beeswax contains anti-allergenic and anti-inflammatory properties. In fact, it is one of the best skin care ingredients for healing rosacea and eczema. Additionally, beeswax does not clog your pores and is an exceptional natural alternative to mineral oil.

Mineral oil is made from petroleum, and the process of its extraction is a major cause of climate change and global warming.

If sustainable living is one of your new year’s resolutions, then finding swaps for petroleum and oil-based products are going to be high on your list.

 

 

3. Jojoba Oil

 

The Why: Jojoba oil has anti-fungal and anti-inflammatory properties. Plus it contains vitamins B and E. Jojoba is a shrub that grows in the Sonoran Desert of the US and Mexico.

It has many special characteristics, which makes it inherently sustainable:

  • Long lifespan (some shrubs can live over 100 years).
  • No annual re-planting required (as only the seeds are harvested).
  • Produces seed oil that is non-perishable.
  • Disease, pest, and drought resistant.
  • Grows in arid climates (requires less water).

.

Budget Benefits: A bit of Jojoba oil goes a long way. You don’t need very much to get the job done.

Tip: The Jojoba oil is a bit more expensive per ounce than other carrier oils. Sometimes I will add raw organic food-grade coconut oil to bring the cost down.

Health Benefits: Jojoba oil is rich in iodine, which fights harmful bacteria growth that can lead to breakouts. Additionally, natural antioxidants help heal sunburns and fight infections.

 

 

My Favorite Rich and Creamy Hand Lotion Recipe:

 

  1. 1/4 cup shea butter
  2. 1 Tbsp. Jojoba oil (carrier oil)
  3. 1 Tbsp coconut oil (carrier oil)
  4. 1.5 Tbsp. beeswax
  5. 10 drops of essential oils
  6. Let it sit on your countertop to cool!

 

You are done! That was super simple and easy. This whole process takes me around 15 min.

 

How to Prepare Your Mixture: 

 

  1. Heat the mixture in a glass measuring cup, that is sitting in a pot (containing water) over a stove top (on low).
  2. Use the microwave on 50% power. When using the microwave, I periodically check and mix the concoction in 15-second increments. I start off with the thickets ingredients first and then add the liquid ingredients last. Meaning, melt the beeswax first, then add the coconut oil and Shea butter. You do not need to microwave the liquid ingredients (jojoba oil and essential oils). Make sure to stir the mixture periodically.

Sometimes if I am lazy, I microwave the mixture straight in the glass jars (mentioned below). This reduced the cleanup time. I have gotten it down to where I just dirty 1 spoon!

What’s better than soft and smooth skin?  Soft and smooth skin that smells like fresh-picked Lavender and rose!

My Top 3 Favorite Essential Oils:

 

  • Eucalyptus– Eucalyptus essential oil has been used for centuries as a decongestant, deodorant, and disinfectant. That is because it naturally has antiseptic, anti-bacterial,  and anti-inflammatory properties.  Not only does eucalyptus essential oil smell amazing, but it stimulates your immune system! This is why I tend to make a eucalyptus essential oil during the winter time.
  • Rose– Rose essential oil is a powerhouse of anti-aging goodness!  It is an antioxidant and has anti-inflammatory properties that can help reduce redness and blemishes. It also improves blood flow and helps keep skin moisturized. I love to make rose-scented lotions and lip balms in the summertime.
  • Lavender– Lavender essential oil is an antioxidant that fights free radicals (which contribute to skin damage).  It has been proven to help circulation and increase blood flow to the skin. This allows oxygen and nutrients to reach the skin for the renewal and healing process.

 

Reusable Containers:

 

The Budget Benefit: Reuse these jars and tin containers over and over again.

 

4. Reusable Glass Jars

The Why: Contains Twelve 4oz jars with inner liners and dome lids that create a tight seal. You won’t have to worry about your handmade lotions leaking or spilling. You can get a hold of these jars on Amazon here. 

 

 

5. Screw Top Tin Containers

The Why: I use these tin containers to make my own lip balms/moisturizers. This container is also perfect for making hair waxes and beard balms for friends.

Eco Benefits: Tin cans are reusable and recyclable. Plastic, like paper, has fibers that shorten each time it is recycled. Glass, steel, and aluminum do not lose their quality during the recycling process and can be recycled endlessly.

Health Benefits: Lotions are often made with petroleum derivatives. Instead, opt to use minimally processed oils and plant-based ingredients.

 

Bonus Tips:

 

  • If you want a thicker consistency, then add more beeswax (lip balm and hair waxes are thicker than lotion). 
  • I tend to make a bunch of beauty products all at once, so I can fill several refillable containers. That way I have an inventory of products when I need them.
  • Lip balms, lotions, and hair waxes often contain many of the same ingredients (in varying quantities). This allows me to make a variety of personal care products with different essential oils, all at once.
  • These homemade beauty products make awesome, inexpensive, and thoughtful gifts.
  • If you want a thicker consistency, then just add more beeswax (lip balm is thicker than lotion). 
  • If you are visiting a dry area, like a high desert, mix Jojoba oil with coconut oil, avocado oil, and olive oil to create a super moisturizing hand oil.
    • Another use is to rub a dime-sized drop between the palm of your hands and then run it through the tips of your hair.  Make sure that you keep the oil towards the tips of your hair so that you don’t end up with a greasy look.

By making homemade hand cream, you can skip driving to the store and wandering around aimlessly looking for a thoughtful gift. Never get caught off guard by having to think about what to give a friend for their birthday, graduation, or celebration gift.

 

Like what you see? Stay a while!

 

Give a sustainable gift that is homemade, from the heart, and improves skin elasticity. Every friend will love you for it! Save money by making your own beauty products at home.

In sum, you will be using higher quality organic ingredients on your permeable skin, over petroleum (oil based) products. 

Take action today, and visit the Sustainability Shop to start using zero-waste, plastic alternative, and biodegradable products.  I have done the work of reading the labels and reviews to offer you the best sustainable products on the market.

I want to encourage you to reuse your belongings until they are either broken or no longer useful and you need to replace them. Of course, if you are using something that is not good for your health (like cooking with Teflon that was manufactured prior to 2013 or drinking from plastic water bottles), then purchasing a replacement makes sense.

If global warming, climate change, and resource depletion are important topics to you, then enroll in a FREE 5-day email course to learn about other money-saving sustainability swaps and actions that you can take to save the world!

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New Year’s Resolutions to Create a Sustainable 2019

New Year’s Resolutions to Create a Sustainable 2019

Happy New Year’s! I am so grateful for all of the amazing things that happened in 2018 and am so excited for all that is to come in 2019. January is usually the time when we look out into the future and set a few goals to improve our lives. Striving toward a more sustainable lifestyle is one goal that has budget, environment, and health benefits.

The goal of Eco Economics is to show you how to save thousands of dollars by going green and how to reinvest those savings into financial vehicles that will help you gain your financial freedom.

Living a sustainable lifestyle has wide sweeping impacts on:
  • Our children’s future
  • You and your parent’s respiratory health
  • Quality of the food you eat
  • The environment that you live in
  • The planet’s biodiversity

 

UN scientists have released a warning stating that the world has less than 15 years to reduce the carbon output to nearly 0 or else face serious climate change consequences. 

What is really scary to think about is that three-quarters of the world’s mega-cities are by the sea. Moreover, imagine the level of geopolitical instability that would occur should billions of people need to relocate due to rising sea levels.

According to the UN, 2.4 billion people (40% of the world’s population) live within 60 miles of the coast. To give you a comparison, the recent instability in Syria has displaced 13 million people. Now, just imagine the level of crisis that would occur should 1 billion people need to find new homes. I am not an alarmist. I just want you to know the facts.

 

This infographic, provided by the Union of Concerned Scientists, does a fantastic job of showing you how much water levels could rise over the next 100 years.

 

 

I urge you to join me by taking the Sustainability Pledge and promising to be the change that the world, our children, and the future needs. Start by educating yourself and investing in a sustainable lifestyle.

If global warming, climate change, and resource depletion are important topics to you, then sign up for the Free Sustainability Mini-Email Course.

7 New Year’s Resolutions to Create a Sustainable 2019:

 

If you are reading this article, it is because you are actively looking for ways to reduce your waste, increase your energy efficiency, cut down on spending, and live a healthier lifestyle.

With that in mind, I am sure that some of you are even looking to go a step further. Know this, eco-friendly, zero-waste, and minimalism are not all-or-nothing concepts. It’s about becoming conscious of your actions and starting small. Taking many small steps can result in a major social movement. As a consequence of your actions today, social movements can change the course of history.

The more you act and buy green, the easier it becomes. Soon, you won’t even have to think about it…It will just become “the way things are done”.

So, let’s get straight to it! Here are a few New Year’s resolutions that you can make to live a more sustainable lifestyle in 2019.

 

1. Plant a Carbon Sequestering Garden:

Reduce how much you spend at the grocery store each week by starting an organic carbon sequestering garden!

Planting an edible garden is one way you can make a huge difference by helping sequester carbon from the atmosphere!

Want to know what you need to start a carbon sequestering garden? Click here to learn about the benefits and how to get started!

2. Create a Habitat for Mason Bees:

 

In recent years, the decline of bees has become a cause for major concern for everyone.

Bees help farmers pollinate the crops that we rely on for food.  You can help our environment and eat better tasting  (bigger fruits and vegetables) by starting your very own Mason Bee garden.

Mason bees are 10x more productive than the common honey bee. This is because they are more efficient at pollinating flowers. What’s more is that they don’t travel as far to collect pollen so they are less likely to be exposed to diseases. Mason Bees cannot create their own hives, which is how you can help them by providing them a place to live!

Here is a quick video by TED that explains why our bee populations are in such great decline.

 

Starting your own bee garden is super simple and cheap!

 

3. Purchase a Zero-Waste Kit:

 

Making the switch over to a zero-waste or minimalist lifestyle has a relatively small start-up cost. One of the benefits of switching over to a sustainable lifestyle is that these products that will save you money over the long run!

One useful tip is to have a “to-go zero-waste car kit” that always stays in your car. I always keep reusable bags, to-go containers, a clean coffee mug, a full reusable water bottle, and a utensil kit in the back seat of my car. This way the kit is always on me where ever I go and whenever I need it.

Your zero-waste home kit should contain the following items at the very least:

4. Avoid Single-Use Items:

 

Bring your own or just decline the following items:

  • Cups
  • Balloons
  • Straws
  • To-go doggy bags
  • Fast food waste
  • Paper towels
  • Aluminum foil (use a silicone baking mat instead)

 

 

5. Water Conservation:

 

In total, humans can only use 1% of all the water resources on earth. The EPA website states that the U.S. population has doubled over the past 50 years, while our thirst for water has nearly tripled!!!

The US government estimates that at least 40 states anticipate having water shortages by 2024. Clearly, the need to conserve water is critical.

What you can do:

 

6. Increase Your Home’s Energy Efficiency:

 

Insulating your home will increase its energy efficiency, reduce your energy usage, and save you tons of money! The more air-tight your home is, the more money you can save. This is because heat won’t escape during the winter and the cool air will stay in your home during the summer. 

What you can do:

You can find additional insulation solutions on Eco Economic’s Sustainability Shop page.

The shop includes energy efficiency and water conservation conversion kits, solar products, zero-waste, and minimally packaged home goods.

 

7. Learn Online:

 

Take full advantage of the library system. You can listen to and read books online for free through an app called OverDrive which is connected to your local library. Subscribe to online versions of the news. Read informative sustainable books and watch documentaries to learn about what the mass media isn’t covering.

Become a life-long student and invest in yourself. Sustainability and personal finance are two topics that are not taught in schools, yet they impact every person’s life on this planet. Master your personal finances and learn how to live a more sustainable lifestyle by taking the Free Increase Your Financial IQ Mini-Email Course. 

Learn how to save thousands of dollars by going green and then how to reinvest that money to gain your financial freedom!

Reduce your carbon output by learning online and in your pajamas.

 

Increase your Financial IQ

 

 

Articles that may interest you:

 

Did you know that it only takes 25% of a population to start a major social movement?

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How to Reduce Climate Change by Acting and Buying Green

How to Reduce Climate Change by Acting and Buying Green

How to reduce or eliminate your climate change impact by acting and buying green. Living a sustainable lifestyle means something slightly different to everyone. The end goal is that everyone becomes a little more conscious of how they are using the earth’s resources and takes small but meaningful steps to reduce their impact.

reduce climate change

It doesn’t matter where you are in your sustainable living journey.

Start by taking a mental inventory of where you are currently. Then, make changes towards a more sustainable lifestyle so that we can move toward a greener future together 🙂

Even politicians are having to come around to the fact global warming and climate change are issues that we are going to have to deal with in the near future.

If we know that global warming and climate change is a major problem, then why not tackle it today…Rather than put it off, and let it grow into a larger issue that we still have to face tomorrow.

There are two ways for us to tackle this problem.

The answer is to act in ways that prevent global warming, and purchase products from companies that consciously manufacture goods with social and environmental integrity.

 

What Does it Mean to Live Sustainably?

Sustainable living is not just about reducing your carbon output. Here is a quick list of meanings that come to my mind when someone says the word sustainability:

Acting and Buying Green:

Acting green means to change your habits, whereas buying green means to consciously purchasing products that are manufactured in a socially and environmentally responsible way.

One way to both act and purchase green is to start your own carbon sequestering organic garden!

A Carbon Sequestering Organic Garden Helps Reverse Global Warming and Climate Change:

 

Planting a fruit, vegetable, and herb garden helps take carbon dioxide from the atmosphere and turns it back into clean oxygen!

Let’s take it a step further, and talk about why you should take the organic garden route.

Then later in the article, I’ll talk about how you can use an all natural pesticide and fertilizer (worm casting) to keep your garden from being eaten alive by bugs.

When I say all-natural, I really do mean 100% (no-chemicals involved) natural fertilizer that doubles as a pesticide!

Home gardening accounts for nearly 80 million pounds of pesticides used per year in North America.

Most of these chemicals are used to control those annoying insects that eat your fruits and vegetables.

Unfortunately, these chemicals find their way into streams or rivers as runoff, and from there into the oceans.

In sum, these pollutants and chemicals are not confined to our oceans and drinking water resources. We end up consuming them through the food web too.

Much of our food livestock eats pounds of grain that have soaked up these chemicals through the soil. This is called bioaccumulation.

Biomagnification is when we consume meat that has eaten lots of polluted corn meal or grain, and the pollutants travel up the food chain and into our bodies.

When you eat contaminated food, you absorb those chemicals and over time they build up in your body.

 

Starting an organic garden is a great way to:
  • Reverse climate change (when you carbon sequester, you turn carbon dioxide back into oxygen which reverses global warming)!!
  • Reduces your weekly grocery bill.
  • Be healthier (and the food tastes better!).

Worm Casting: 

 

Worm casting is a natural fertilizer that is also a pesticide!worm casting

Instead of growing grass, grow edible organic fruits and vegetables!

Before you ask about the additional water costs, ill point you to this awesome rainwater collector!

Rainwater collector

 

 

Eco Economics is all about showing you how you can save money by going green and then reinvesting that money to gain your financial freedom!

If you would like to learn more, you can take the Free Sustainability Mini-Email Course by clicking here.

Starting a carbon sequestering garden will save you money, your health, and the environment.

To read about the 14 benefits of starting your own carbon sequestering organic garden click here! You will also learn more about the 8 benefits of worm casting and composting!

Now that we have covered ‘how to reduce the number of chemicals that you put into your body’, let’s take a look at how to reduce the number of chemicals inside of your home.

 

 

Buying Green Cleaners:

 

Another way that your body comes into contact with chemicals is through the many cleaning agents that you use to “sanitize” your home.

By using zero-waste or minimally packaged concentrated natural cleaners, you can cut down on your resource consumption and limit the toxins in your home.

I personally love the zero-waste Provence de Marseille Soap.

You can use it to remove tough stains on clothes, grease from dishes, or to shower off with at the end of the day.

This soap is primarily composed of Olive Oil and is made of 100% vegetable ingredients.

Of course, it is cruelty-free and does not contain colorants or artificial ingredients!

 

Buying Concentrates:

 

Branch Basics bottleMy favorite all-natural concentrate cleaner is by Branch Basics.

The concentrate is a powerful plant and mineral based cleaner.

The Benefits of Using a Concentrate are:
  • Less packaging means more eco-friendly (liquids condense into smaller bottles and fewer bottles need to be purchased on an annual basis).
  • Less transportation fuel (why ship diluted cleaners to the store or to your home? That’s just silly).
  • Save money (buying a cleaner in a concentrated formula is cheaper than purchasing a diluted version + save money on packaging).
  • Re-fill and reuse the plastic squirt bottles that you already own.

Moreover, you can save as much as half of your yearly cleaning budget by buying your cleaners in a concentrated formula!

The average cost of a 32 oz “green” cleaner is $6.18 (or $0.20 per ounce).

Instead, a 32 oz. bottle of Branch Basics Concentrate can make 16 All-Purpose bottles (24 oz), at $3.06 each ($0.12 per oz)!

This all-purpose cleaner is so natural and healthy that you can basically use it everywhere.

It may be harder to think of places where it can’t be used…

The Branch Basics Concentrate is great for:

  • All-Purpose: Appliances, Dishes, Granite, Grills, Highchairs, Jewelry, Marble, Natural Stone, Pacifiers, Pots & Pans, Stains, Stovetops, Sticky Spills, Yoga Mats
  • Bathroom: Tile, Grout, Countertops, Sinks, Showers, Tubs, Toilets, Fixtures, Shower Liners, Soap Scum
  • Streak-Free: Windows, Mirrors, Glass Surfaces, Computer Screens, Phones and Tablets, Fixtures, Aquariums, Shower Doors, and Picture Frames
  • Foaming Wash: Hands, Face, Body, Baby, Hair, Pets, Removing Make-Up, Shaving, Dishes, Fruits & Vegetables
  • Misc: Laundry (192 loads), Stainless Steel, Wood, and Vinyl Floors, Carpet

 

What’s more is that all Branch Basic products are:

Branch Basics product description

 

The money you save can be put toward any number of uses, but since Eco Economics is about sustainability and increasing your financial IQ…

I would say that the highest and best use of this money is to devoted it to a tax-advantaged account that helps you achieve financial freedom!

As a result, you receive the same service (a clean home) at a fraction of the cost and impact to the Earth!

The Take Away: 

 

Yes, ideally we would love to live in a world where plastic doesn’t exist.

Especially since we now know all of the health and environmental problems that plastic causes.

Being aware of a problem is one thing, but doing something about that problem is a completely different scenario.

We may not be able to rid ourselves of plastic entirely, but we can do the following things to reduce our plastic usage:

  1. Decline single-use plastic items
  2. Buy zero-waste, biodegradable, and all-natural products
  3. Re-use the plastic bottles you already own (use an empty sriracha bottle as a squirt bottle for your all-natural cleaning solutions. You hide your cleaning solutions in a cabinet where no one sees them anyway!)

Take action today, and remember to visit the Sustainability Shop to start using zero-waste, plastic alternative, and biodegradable products.

If global warming, climate change, and resource depletion are important to you, then pre-enroll for the free Sustainability Mini-Email Course. You will learn about other money-saving sustainability swaps and actions that you can take to save the world!

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I sincerely only hope to provide helpful information. If you are curious about a specific topic or have a question about anything that I have written, please feel free to comment or contact me.

Keep in mind, it only takes 25% of a population to start a major social movement.

Become a Sustainability Hero by helping me spread the world! Please re-pin and share, so that I can continue to provide you with free content.

 

How to Save for Retirement by Going Green: Insulation

How to Save for Retirement by Going Green: Insulation

Sometimes it may seem like it is impossible to find money at the end of the month to put towards your retirement account. This is why it is critical to making the most of every dollar! Insulating your home is one of the most effective ways to decrease your energy bill by going green. Another benefit is that many energy efficiency updates qualify for tax credits and utility company rebates!

How to Save for Retirement by Going Green Insulation (1)

You can double or even triple up on your savings! Consequently, you can put all of these savings towards your tax-advantaged retirement account!

 

Save Thousands by Going Green!

A FREE Checklist on How to Fund Your Retirement Account by Going Green.

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How Much Can You Save by Properly Insulating Your Home?

 

In short, by adding insulation to your home you can reduce heating and cooling costs anywhere from 10% to 50%.

Of course, the amount you save depends on where you live and how much insulation you already have.

For instance, a homeowner in the Northeast with an uninsulated attic can save around $600 a year by adding about 15 inches of insulation (R-38- ill go over R-values later in this article).

In fact, just 6 inches can net annual savings of around $200.

According to the Lawrence Berkeley National Laboratory, by simply reducing your home’s air leakage by 25%, you can lower your annual energy costs by around $300.  

The money you save can be put toward any number of uses, but since Eco Economics is about sustainability and increasing your financial IQ…

I would say that the highest and best use of this money is to devoted it to a tax-advantaged account that helps you achieve financial freedom!

Depending on the type of materials you use, you will pay an average of $1,500 to insulate an 800-square-foot attic. If you do this, you can expect to have a payback period on your investment in three years.

You’ll spend about half that if you do the job yourself!

So if you are nifty and have a spare weekend, add it to your list of DIY projects and save a cool $800. This also means that your payback period is also cut in half!

Visit the Sustainability Shop and under the tab called Energy Efficient Home you will find many insulation products to start saving money today!

 

 

The Nonbusiness Energy Property Tax Credit:

 

As of the 2018 tax year, the federal government offers the Nonbusiness Energy Property Tax Credit. These credits are good through 2019 and then are reduced each year through the end of 2021.

This means that if you are interested in taking advantage of the biggest federal renewable energy tax credit, you will need to take action within the next year!

The Nonbusiness Energy Property Tax Credit allows you to deduct 30% of the cost of installing a solar energy system from your federal taxes. On the same tax form, there is an area that allows you to deduct a portion of the cost to increase the insulation in your home.  

The link to the tax form is included in a later portion of this article for your convenience.

If you are interested in learning how you can DIY your own solar panel system, visit Renewable Energy Tax Credit: How to Install DIY Solar Panels. You can build your own solar energy system for 60%-70% cheaper than if you were to get one installed!

The credit is equal to 30% of the cost, including installation. Moreover, there is no upper limit on the amount of the credit for solar, wind, and geothermal equipment.

The Increase Your Financial IQ Course will be released soon and will cover how to write-off solar energy improvements to your investment properties.

You can sign up for the Free Increase Your Financial IQ Mini-Email Course to get notified when the full-blown Increase Your Financial IQ Course becomes available. The mini-email course is designed to show you how easily you can save for retirement, and how to use a tax-advantaged account to reach over $1,000,000 in savings. 

To find utility company rebates offered in your zip code read, “Renewable Energy Tax Credits, Incentives, and Rebates“.

Equipment that Qualifies for the Residential Renewable Energy Tax Credit:

 

The credit includes costs to install solar, wind, geothermal and fuel-cell technology updates to your home.

  • Solar panels for generating electricity
  • Solar-powered water heaters. The water heated by the system must be used inside the home, and at least half of the home’s water-heating capacity must be solar. (Solar heaters for swimming pools and hot tubs do not qualify.)
  • Wind turbines that generate up to 100 kilowatts of electricity that must also be used in the home.
  • Geothermal heat pumps that meet federal Energy Star guidelines.
  • Fuel cells that rely on a renewable resource (usually hydrogen) to generate power for a home. The equipment must generate at least 0.5 kilowatts of power.

 

For the average person, the solar panel and wind turbine options are going to be the easiest to install, with the fewest regulations to get past.

 

 

Nonbusiness Energy Property Tax Credit:

 

Equipment and materials must meet technical efficiency standards that have been set by the Department of Energy.

Manufacturers typically advertise that their item meets this standard. In short, if a product does not advertise that it meets the standard, be sure to ask prior to purchasing.

Turbo tax does a great job explaining the two kinds of energy efficiency improvements that you can write off. I have listed them here for your convenience…

For this credit, the IRS distinguishes between two kinds of upgrades:

1. Qualified Energy Efficiency Improvements:

  • Exterior windows and skylights
  • Home insulation (Just about all types: fiberglass, cellulose, mineral wool, spray foam, foam board, and cotton batting qualify for the energy tax credit)
  • Exterior doors
  • Certain roofing materials

2. Residential Energy Property Costs:

  • Electric heat pumps
  • Electric heat pump water heaters
  • Central air conditioning systems
  • Natural gas, propane or oil water heaters
  • Stoves that use biomass fuel
  • Natural gas, propane or oil furnaces
  • Natural gas, propane or oil hot water boilers
  • Advanced circulating fans for natural gas, propane or oil furnaces

 

There are a few credit restrictions, like a maximum of a $200 credit for windows. For a full list be sure to consult your tax accountant. You can review Turbo Tax’s exceptions list here.

Remember it is critically important to save your receipts and labels for Uncle Sam.

 

 

Which Tax Form to Use:

 

The form to use to claim your solar or wind credit is called The Residential Energy Credit  Form 5695, which is filed with your tax return.

On this same form, you can add any write-offs you have made to insulate your home.

For insulation updates, you can write off 10% of expenditures, up to $500 for the year. This amount is for all energy improvements combined.

 

 

R-Value:

 

The R-value measures the home’s resistance to air flow, which means less heated or cooled air escapes. The higher the number value, the better the insulating power.

The Department of Energy (DOE) recommends an R-value between 30 to 60, depending on where you live.

According to the EnergyStar website, the recommended level for most attics is to insulate to R-38 or about 10 to 14 inches, depending on insulation type.

I have inserted a photo of a map of the US and a chart with the recommended values provided by the DOE.

 

 

 

Eco Economics will be Offering Two kinds of Courses:

 

  1. The Sustainability Course: How to live a sustainable lifestyle and save money by going green.
  2. The Increase your Financial IQ Course: How to achieve financial freedom by using tax-advantaged accounts, understanding proper financial planning, and wealth creation through real estate.

 

The two courses are designed to be taken together so that one shows you how to save money, while the other shows you how to reinvest that money to help you achieve financial freedom.

 

Increase your Financial IQ

A Few of the Topics That are Covered Are:

 

  • Money-saving green swaps and actions that you can take to save our planet
  • How to maximize the energy efficiency of your home (reduce your utility bills)
  • Find the right renewable energy solution to give you energy independence (reduce or eliminate the impact of utility rate increases).
  • How to reduce your carbon output
  • How to start your own carbon sequestering organic garden
  • Much more!

 

Click on either or both of these two links to sign up for the Free Sustainability Mini-Email Course or the Free Increase your Financial IQ Course.

 

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By sharing we can help others save money by going green, all the while saving the planet together! Remember, it is our own lives and futures at stake.