Money has been playing an important role in human decision-making activities since the beginning. It has a profound impact on our lives, society, culture, finances and economy.
The money itself has changed form, from bullion like gold, silver and other metals, to a fiat currency like powerful greenbacks to the present-day cryptocurrency like Bitcoins.
The article covers the nostalgic journey of money in the last 100 years (1920 vs 2020) and how the form of money was then (1929) and the way we see & use it now.
Money Then Vs Now (100 Years of Change)
The value of money is driven by its buying capacity, which in turn depends on inflation, meaning your means of living gets dearer over time. Let us see how inflation has changed the value of money over 100 years.
Inflation causes money to lose its value over time, it eats a portion of our hard-earned money. A person with $100 to $150 in his pocket in the 1920s had a decent life.
Back then, commodity and service costs were a lot cheaper. The average price of bread was 10 cents, egg cost 63 cents, and butter could have been bought for 63 cents. An average middle-class US family earned about $1,500 per year and saved less than $100.
Now, the average annual household earnings before taxes is $76,118 and the average expenditures is around $60,580.
In 100 years, the inflation rate had a roller coaster ride with two world wars and the great depression in the initial decades (1920 to 1950).
The period of economic growth cycles and subsequent crises moved inflation up and down in the later five decades (1960 to 2020). In every such phase, the government had to intervene to cool it down by playing with the interest rates.
|Year||Average inflation for that particular year|
|2020 (for the month of March)||1.54%|
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Share Market Movement Globally From 1920 to 2020 (Then Vs Now)
Money and stocks have an old relationship, you can literally gauge a picture of people’s money behavior, and the country’s economic condition from the stock market movements.
During the past 100 years, the Dow Jones index rose more than 10 times even after accounting all the world wars, crisis and bubbles. People were more euphoric than in 1918 (after WWI) when manufacturing was booming until the great depression.
Even in recent years, the stock market rallied post subprime crisis (2008). That shows that people were optimistic in an era and money was fueled in stocks in the belief of generating stellar returns.
The problem arises when prudent investing practices turn into mass madness and a greedy race to accumulate wealth begins.
The last 100 years of journey transformed America from a cotton-producing agrarian society in the pre-civil war era to a manufacturing economy in the 1920s.
The period also saw the start of the modern auto and airline industries. Industrialization & mass production were the norms and that triggered the new consumer goods boom.
Even in the 1920s, there were companies like US Steel, telecom (AT&T) and oil companies (Standard Oil) with assets worth billions of dollars.
The scenario changed in the 50s to 70s with the development of electronics and communication technologies. America had big corporate giants like IBM & AT&T with a market valuation of over $200 billion. But, the top industries still had space for auto manufacturing (General Motors) and oil companies (standard Oil).
The later period saw corporate America shape into an internet knowledge-based service industry. Companies like Apple, Google (Alphabet), Microsoft, Facebook and Amazon hogging the limelight commanding valuations in 500+ billion dollars.
Now, the above companies occupy the top positions in the list of top 100 companies.
However, the century also saw the fallout of giant companies, some due to technological obsolescence like Kodak and Netscape and others due to financial losses and crises.
Below is the list of big businesses that went out of business.
|Compaq||Merged with HP|
|Enron||Accounting fraud filed for bankruptcy in 2001|
|Pan Am (1927-1991)||Financial losses & bankrupt|
|Arthur Anderson – Big 5 Accounting & Consulting firm||Editor of Enron, hand in Enron’s misdeeds|
|TWA (Trans World Airlines)||Bankruptcy, acquired by American Airlines|
|Yahoo||Stock prices tanked from $118 in 2000 to $8 in 2001 in the dotcom bubble. 2017 Verizon purchased it.|
|Bear Stearns & Lehman Brothers||2008 Subprime crisis|
|Eastman Kodak Co||Bankrupt 2012 due to digital photography|
How People’s Money Choice Has Changed
#1. Period of coins, savings and farms
The United States dollar dates back to more than 240 years when Continental Congress authorized the issuance of Continental Currency in 1775.
The term United States Dollar became the country’s standard unit of money in 1792 with the Coinage Act of 1792.
This was the period when people held money in coins, invested in farm properties, cotton-producing machinery and slaves. They saved more money to invest in acquiring larger tracts of lands and setting factories.
However, trade and commerce still relied on gold and silver and the bimetallism persisted until 1900. By this time the gold standard (a monetary system where the currency’s value is directly linked to gold prices) came into the picture.
#2. Money in the form of Gold & Paper
The gold standard was called off after the first world war by most of the nations but continued in the United States until the great depression. However, the U.S. continued using the gold standard until the 1970s in an indirect form by basing the dollar value.
Post World War II, the world saw the European and Asian economies collapse while the United States was the least impacted. This established America as the global Super Power and the rise of the new international monetary system under the Bretton Woods Agreement.
The global currency was pegged to the US dollar’s value and in turn, the USD was valued on gold. The system bought the US dollar in wide circulation and made it a global trade currency, which continues till now.
The Bretton Woods system ended in 1973 when US President Nixon stated that the U.S. would no longer exchange gold for U.S. currency.
#3. Increase global money supply & consumerism
With the booming economy (1950’s to 1970) the consumerism culture became prominent. The earlier saving and investing habits turned into a culture of spending.
Earlier, people kept physical money in the form of paper notes and coins but now they prefer having plastic money. The first universal credit card was issued by Diners Club Inc in 1950 and the travel and entertainment cards by American Express Company came into the picture by 1958.
ATMs came into existence in the 1960s and the internet emerged in the 1980s which radically changed the way people used money.
#4. Digital Money
The broadband and digital networks began to connect consumers with retailers and in turn to suppliers.
By the 1990s, the internet became a widely used conduit to transfer money and online banking started getting mainstream creating a way for present-day digital payments.
The digital wave meant that people need not carry physical cash in their wallets, but have all the purchasing opportunities on their fingertips.
The quest for even more free money (still the money related controls lies with the government) led to the invention of cryptocurrencies like Bitcoin and Ethereum.
Possibly we are now looking at a global cryptocurrency that reduces transaction costs, reduces banking infrastructure & manpower and is theoretically immune to government old ways of regulation & controls.
Globally Crisis Happened in the Last 100 Years
Global crises have impacted the economies of various countries in the past 100 years. The period saw the rise of America as a power hub and the decline of Europe’s global quest to control trade and commerce.
The time-period wise incidents that greatly impacted the world economy and especially the United States are.
Civil War – How Did the Southern Economy Change After the Civil War
Before the civil war in the 1860s America was divided into Northern states and the Southern states. The prominent Southern states at that time were Atlanta, Charleston and Richmond.
Before the war, the South’s economy was based on agriculture (cotton, tobacco & sugar). The economy was powered by the cheap slaves bought from African countries.
The civil war collapsed the southern economy but gave freedom to more than 3 million African Americans from slavery.
The newly found freedom empowered African Americans to move freely and rebuild families. Now they were allowed to enter into contracts and hold property. Post-war, a period of reconstruction followed where the Republican policy in the South tried to transform the region into a free-labor economy like the North.
The reconstruction period did not result in an immediate economic boom for the South and was marked by poverty. The North also took time till the 1870’s to regain its pre-war pace of industrial and commodity output.
There was a scenario of conflict and confusion over the direction of American economic development until the end of the century.
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How Did the Economy Change After World War I
Before World War I, the global economy was growing robustly mostly led by Britain and European nations.
Industries like steamships, cotton production, telephone & telegraph, and global travel flourished. There were no boundaries, immigration rules and no passports requirements.
By the time the war ended, countries started to impose restrictions on trade, capital flow, and immigration.
The governments also knew that the citizens would submit to taxation in the name of protection from outside forces and people unified for a common cause. The U.S. top tax rate rose from 7% in 1915 to 77% in 1918.
The United States became the global superpower by ramping its large natural resources and doubling the economic output. As a result, the United States came out of the recession (caused due to civil war and WWI) and became a lender to the world.
The war stopped labor immigration from Europe, and the North companies started recruiting black Southerners to work in their factories. This turned America into a unified cohesive unit.
The World War also saw the spread of the global influenza pandemic (1918) caused due to the movement of troops like the present Corona.
Worldwide 500 million people were infected, 50 million died and in the United States, the death toll rose to 675,000.
Great Depression and Wall Street Crash (1929)
The post-WWI optimism was halted by the Wall Street Crash of 1929 and triggered the great depression. The crash which started at the New York Stock Exchange spilled over to the London Stock exchange and exposed dangers of easy credit and speculation.
In the period post-1920s, agriculture produces, build]ing construction, steel and automobiles registered huge growth.
The booming economy led Americans to speculate heavily in the stock market even on the borrowed capital to the extent that $8.5 billion was loaned to investors. This created an asset bubble.
The average price to earnings ratio of S&P Composite stocks was 32.6 in September 1929 clearly above historical norms.
The great depression between 1929 and 1932 saw the world’s GDP fall by an estimated 15% and the global trade fell by 50%. In comparison to that, the worldwide GDP fell by less than 1% from 2008 to 2009 subprime crisis.
The few countries started to recover by the mid-1930s but for many countries, the recession lasted until the beginning of World War II.
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How Did the US Economy Change During World War II
Until World War II, the United States was still facing a high jobless rate of 25 percent and bankruptcy was the norm. The standard of living was far below that of the pre-crash period.
With the start of World War II, the government needed food, weapons and soldiers. The existing factories and assembly lines were realigned to produce goods to support the war effort.
This resulted in an overnight drop in the unemployment rate from 25% to around 10%. Moreover, now the women were given the charge of the factories as men went to fight wars.
World War II involved 30 nations and approximately 4% of the world population was eliminated. The world saw the might of nuclear bombs in Hiroshima, which killed two-thirds of Hiroshima’s population.
By the end of World War II, the U.S. became the supreme power with no real opposition at all. . The Bretton Woods system came into the picture and the U.S. dollar became the global currency.
International agencies like the United Nations and the World Bank were created to help countries and prevent any further World Wars.
During the war period, the U.S. GDP grew at least 8% annually between 1939 and 1944 and more than 17% between 1941 and 1943.
How Did Stalin Change the Soviet Economy
Joseph Stalin was the dictator who ruled the USSR from 1929 to 1953. He was the man who transformed the Soviet Union from a peasant society into an industrial and military superpower.
Stalin launched a series of five-year plans to transform the Soviet Union in which the government took control of the economy and forced collectivization farms.
The measures saw rebellion across farmers who refused to cooperate with Stalin’s orders and were either shot or exiled.
After coming into power, Stalin expanded the Soviet Union and established the communist government in entire eastern Europe. Stalin is also credited with leading Russia into the nuclear age.
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Energy Crises of 1970
Post World War II the economic activity of the United States, Western Europe, Australia and Canada relied heavily on petroleum and oil. Heavy drilling and extraction led to substantial oil shortages at high prices.
The worst phase came when the Iranian revolution and Yom-Kippur (Arab-Israeli) wars caused an interruption in oil production in the OPEC and middle eastern countries.
The crisis led to a rise in petroleum prices over $35 per barrel ($109 in present terms) which forced many countries with a period of stagnant growth and oil supply concerns.
But, on the other hand, the energy crisis proved a boon to the economies of the oil-exporting middle east countries. They found new currency in the form of oil and petroleum.
Black Monday 1987
On Monday 19th October 1987, the global stock markets saw a sudden crash in stock prices. The Dow Jones Industrial Average (DJIA) fell 508 points (or 22.6%) to 1738 levels.
The S&P 500 crashed 57 points (20.4%) to 225 levels. Globally, major stock exchanges followed the trend and saw declines by over 20%.
When measured in a common currency (US dollar) the decline was
|20 to 29%||In eight stock exchanges|
|30 to 39%||In three stock exchanges (Malaysia, Mexico and New Zealand)|
|More than 40%||In three stock exchanges (Hong Kong, Australia and Singapore)|
The crash was due to the trader’s fear over the impact of the anti-takeover legislation that the U.S. Congress proposed in order to control the markets. The other factor that contributed to the fall was automated sell orders executed by computerized trading.
The crash spread unrest and fear of looming one more great recession.
Dot-com Bubble (2000-2002)
The 1990s saw the rise of the internet and internet-based technology companies.
From 1990 to 1997, a marked shift to “Information Technology” and computers became a necessity. More than 35% of the household in America had computers and people were ready to invest in any dot-com businesses.
This was evident from a 400% increase in the Nasdaq composite index from 1995 to 2000. The Qualcomm (internet service company) shares rose over 2000% in value terms. It was common for any internet company to raise money and become public even without profits.
The exuberance led to the dot-com bubble ultimately leading to a crash.
Subprime Mortgage Crisis (2008)
The subprime crisis occurred between 2007 and 2010 due to the collapse of the housing bubble.
The bubble was created when the two leading investment banking companies Lehman Brothers and Bear Stearns sold mortgage-backed securities (MBS) and collateralized debt obligations (CDOs) at a higher interest rate than the government securities. That soon led to subprime lending and an increase in household speculation.
From 2004 to 2006 the subprime rates rose from 8% to approximately 20%.
The subprime crisis led the U.S. into a deep recession where the household net worth declined by nearly $13 trillion (20%) from the peak of Q2 2007. The housing prices fell by 30% and the stock market (S&P 500) fell by approximately 50% from over 1500 to nearly 800 levels.
Climate Change and Economy
Since 1880, the average global temperature has risen over 1-degree Celsius (1.9 degrees Fahrenheit) which is evident from rising sea levels, increasing ocean and air temperatures and melting of polar snow and vast tracts of ice caps.
Climate change brings life and industries like agriculture, marine, forestry and fisheries at risk. Climate change displaced 22.5 million people since 2008. As per the World Food Security and Emigration Report, almost half of Central Americans migrated because there wasn’t enough food available for them.
Global warming has caused long-term disruption in weather patterns that are responsible for heatwaves, blizzards, violent storms, wildfires, hurricanes, floods and landslides.
Since 2000, more than 23 million working life years have been lost to natural disasters. Further, if nothing is done, and the temperature rises to 2-degree celsius then the global GDP would fall by 15% from the current levels.
Money & Economy Now in 2020
How Much Money is in the World Right Now
The flow of money has grown over the last 100 years on the back of free trade and the internet. The rise in disposable income has made it possible for everyone to enjoy the luxuries of life.
The structure and model of businesses changed over time driven by the power of the internet. Banking system also evolved allowing easy exchange of money through the internet. You have instant access to money if you have some sort of credibility.
Below are some examples that go to show how much money is currently in the world.
The world’s GDP which was roughly around $4.74 trillion in 1913 rose to a present-day figure of $85.9 trillion in 2018 almost 18 times in the past century.
The total gold reserves (above ground) are pegged at around 187,200 tonnes and using the gold spot price of $1725/ oz the worth of the world’s gold comes to $11.38 trillion.
In 2017, the total value of all of the world’s coins and banknotes was roughly $7.6 trillion.
In terms of the global stock market, the market capitalization of all the world’s stock markets is equal to $73 trillion. Perhaps the top three companies, Amazon, Microsoft and Apple, each have more than $900 billion in market capitalization
And as per the latest World’s Billionaire list from Forbes reports that the world’s billionaires are worth $8 trillion.
How is the Economy Doing Right Now
Is the Economy Good Right Now
At present, the global economy is impacted by the pandemic of COVID-19 which has resulted in the loss of thousands of precious lives and a total halt of economic activities.
The pandemic has forced governments across the globe to announce relief measures to people and industries. A substantial amount of industrial resources have been diverted to ensure medical supplies, equipment and drugs to fight the deadly virus.
Lockdown of cities, offices, transport and factories has led to a situation of job losses. As per the latest US Unemployment Claims Report, there were 6.6 million claims on March 28. Adding the previous claims of 3.3 million the April job losses are expected to be more than 10 million.
The inflation as per the Personal Consumption Expenditure (PCE) Index Price compiled by the Bureau of Economic analysis estimated February’s core inflation rate at 1.8%. This helped Fed to lower rates to 0% in its measure to fight the Corona pandemic in its March 15th FOMC meeting.
While the world is fighting with the fatal disease, the exact impact will be known in the coming days.
Free Money Now
Earlier, mortgage or loan was the common means to get the money until credit cards came into existence.
The present-day cards have ushered an era of free money. Credit cards have made money accessible at fingertips. But in reality, credit card money is not totally free. You need to pay regular credit card bills before time to earn the 50 days credit free period.
But, the other loans, be it personal, salary or in any other form, do carry some kind of interest rate and charges that you need to pay while you enjoy the money.
Unless, you get grants under the state and federal programs. They also are funded by taxes collected from you, so technically in the present world, you have access to easy money but not absolutely free money.
The free money trends in 2020 are.
Buy Now Pay Later
“Buy Now Pay Later” (BNPL) is a new norm today where you do not even require a physical credit card or load money in your wallets.
Online shoppers have this option at the time of checkout to receive the products and services, but pay the whole amount or installments at a later date.
The term is mostly associated with online merchant’s payments where you buy now pay later without any credit check. You get instant approval and you are not required to make any down payment. This allows you to have free money almost instantly if you are able to pay back the full amount by the due date.
After the due date, penal interest is charged per month which is as high as 36 to 40% per annum. You have the option to have no-cost EMIs and affordable installments.
Afterpay and Klarna are platforms that offer BNPL facility.
Get Money in Your Bank Account Now, Free
This can be in the form of “Instant Loans” or “Payday Loans” where you can receive instant cash credited into your bank account.
You do not need to place any collateral and are an ideal solution to support a temporary financial situation until the next payday.
The amount varies from lender to lender and you can expect to get a loan up to $30,000. The loan is repaid by direct debit on the payday as soon as the salary is credited.
Now, Borrow Money Easily
You can easily have money if you have a good credit history. Borrowing money can be helpful to meet short-term goals like collecting money for a vacation, to pay for a wedding, home renovation or to consolidate credit card debt.
The borrowing is in the form of a personal loan where you get money in your bank account in 1 to 3 days depending on the lender. The typical repayment period ranges from 24 to 60 months.
The loans are unsecured (i.e. the loans are not backed by any form of collaterals) with APRs of up to 12.5% on a 720+ credit score.
Average credit score ratings (630 to 690) will have APR in the range of 17.8% to 19.9%. Anything below 600 will have high loan interest rates.
Different Types of Money Needs
You need money first for fulfilling your basic needs like for daily food, cloth and housing needs. On a higher level, money fulfills your social needs of job security, to handle medical emergencies, for weddings, raising up children, buying luxury items and ultimately for retirements.
In the present world, your money needs are fulfilled first by jobs, this is where you earn your first $ by working smart and hard.
In the next level, money can be earned by making investments in various assets like stocks, real estate, mutual funds, ETFs and retirement plans. This is where you can earn money in the form of interest and gains.
One more way of making money is through passive income by creating an online side hustle that has the potential to generate a decent amount of money. The side hustle can be a blog, e-commerce shop, a youtube channel or a podcast.
A few more life situations where you need money are under
Emergency Need of Money
Emergency money helps you deal with sudden life exigencies like accidents, medical emergency, temporary income loss and jobs.
Bankrate’s survey (January 2020) reveals that 41% of the US household have emergency money of $1000 in the form of savings. The rest 59% population needs to resort to some form of credit for emergency needs, which is a grim situation.
Going by the experts you need to set aside at least six to eight months of your current expenditure as emergency money.
If you do not have one you can start an emergency fund by opening a high yielding savings account and make a small but regular transfer.
Where to Borrow Money With Bad Credit
What to do if you need money now when you have a bad credit history. The normal banking loans will be hard to get in such a situation but certainly not impossible.
Bad credit limits the amount of money that you can have but does not block all the money. Keep in mind that you need to be ready to repay high rates as lenders might not take large risks.
You can approach a local bank or credit union that provides personal loans to people with bad credit. The loan amount that you can get could be in the range of $1000 to $2000.
You can get a higher amount if you can bring in a co-signer with good credit standing.
The other money option for people with bad credit are
- Installment loans: Where you get a lump-sum loan amount that needs to be repaid in EMIs in 24 to 60 months.
- Payday loans: If you have a job then you can go for short-term payday loans. However the loan amount would depend on your monthly salary, normally the loan amount is in the range of $500 to $1000. Payday loan lenders do not ask for a credit score but charge a very high-interest rate.
Need Money During Unemployment
Again, this is a typical money situation where you are once again constrained by unemployment and also do not want to have an existing bank account.
You need to sell some of your assets and holdings to tide over the financial needs. The loan options available to you are:
#1. Auto Title Loans
You can put your vehicle’s title as collateral for the loan, rather than the vehicle. You get 25% to 50% of the car’s value as the loan amount. APR can be high as 200% and it might take a day to get the loan.
#2. Pawn Loans
Pawn loans take valuables like jewelry and electronic items as collaterals. The loan amount is around 25% to 60% of the resale value. The interest rate varies from state to state but is lower than the payday or title loans.
#3. Bitcoin Loans
If you hold cryptocurrency like Bitcoins then you can place it with the Bitcoin lending platform and fund your financial needs. There are investors ready to fund your loans and get repayments.
I Need my 401k Money Now
You can have money from your 401(k) account if you have one. Taking your own money does not require any credit check or placing collaterals.
First, you need to check whether your 401(k) plan allows loans if it does then you can borrow $10,000 or 50% of your vested account balance.
The cap on 401(k) loans is $50,000 and you need to repay the money within five years.
What Can I Sell to Make Money Now (Solution)
If you require instant money and do not want to borrow from someone then you need to sell the household items that you have not used in the past six months.
You can make a list of such items that you do not intend to use in the coming time period. This can be your electronic gadgets, old PC, and smartphones.
Marketplaces like eBay, Craigslist and Amazon (refurbished) offer you a platform where you can list them and get money.
However, those were short-term financial situations. The short-term financial needs can be fulfilled through various loans, savings and credit cards.
But, what if you want to make a constant stream of money, a cash flow that will sustain your long-term financial needs like having a house and constant income.
How to Make Money in 2020
Ways to Make Money Now
There are two money making modes that you can choose as per your skills and preferences. The online method and an offline mode.
The offline ways of making money don’t require you to have smartphones, laptop or an internet connection.
The offline ways that you can use right now to earn money are
- Call you service provider and negotiate a bill
- Check out who owes you money
- Babysit neighbors kids or house sit you can even pet sit
- Organize a garage sale
- Turn your car into a billboard
- Walk dogs and train them
- Take up a house cleaning or mobile car washing
- Offer senior services
21 Ways To Make Money Online Fast in 2020
Make Instant Money Online Now
#1. Take Surveys
Platforms like Swagbucks, Survey Junkie pay you a small amount of money for you to give your time and opinion on a particular product.
You can register with as many platforms and take surveys in your free time. However, you need to be careful about scam websites.
#2. Scanning Grocery Receipts
Apps like ibotta payback for scanning things you bought at the grocery stores. The money is sent to your Paypal account. There are app referral platforms from where you can earn some money.
#3. Online Task
Amazon Mechanical Turk is an example that requires you to complete tasks like transcription, research and playing games to get paid.
#4. Transcribe Audio Files
You can register on platforms like TranscribeMe for rendering transcription services to earn money instantly. You get started by clearing a small test.
You get around $20 for an hour of the audio file.
#5. Creating a Music Playlist
If you have a knowhow of curating a playlist then music platforms like Playlist Push can pay you money for creating a list.
#6. Start a Blog
Blogging takes some time to get off the ground. You need meaningful quality content to get organic traffic and engagements. You need to dedicate time and effort to make your blog popular.
Once you are done, the blog will earn you a passive stream of online money through ads, affiliate marketing, and selling products.
#7. Start a Youtube Channel
Youtube celebrities like Ryan and Jake Paul are earning millions yearly on Youtube. You too can start a Youtube channel in the area of your interest.
Starting a channel requires quality engaging content and constant engagement with the community.
#8. Affiliate Marketing
You can join affiliate networks like ShareASale, Clickbank, Rakuten and Commission Junction to promote other products and services.
In return, you get a fraction of sales as the commission that can range from 4% for products sold on Amazon to 70% for courses and services offered by small businesses and individuals.
#9. Sell Online Courses
Platforms like Teachable helps you create and launch online courses. They also educate you on how to find and reach your audiences.
You can create your own video course and upload them on the platform in the subject where you have authority.
#10. Sell Digital Products
People need eBooks to read, guides & templates to arrange and know things better. You can create digital informational products and sell them online.
#11. Launch an App
Mobile apps facilitate fast and easy access to information and money. People love to install apps on their smartphones.
You do not even require coding skills to launch an app. There are platforms like “Buildfire” that help app development and launch.
#12. Open an e-Store
You can create an online storefront using Shopify and sell your and other products online. The business can be started comfortably sitting at home unless you intend to manage inventory on your own.
The fulfillment can be outsourced to vendors like Amazon that takes care of the inventory and shipping.
#13. Be an Online Influencer
Instagram and Facebook provide the platform to be an online influencer. You can start a group and create a mass following and be an influencer.
The topics can be beauty, fashion, travel, health, fitness, money and relationships. Choose a topic that best resembles you. Businesses and brands look for influences for product launches and brand promotion.
#14. Start Day Trading
You have an understanding of the markets or are ready to learn a few things that you can earn online by day trading in stocks, forex, commodities, and indexes.
There are day traders who solely make a living while day trading. However, first, you should devote time to learn the tricks of the trade.
#15. Become a Freelancer
You can check Upwork and Fiverr for the kind of jobs that are available on the portal. Hundreds of freelance job requirements are posted in the areas of writing, content creation, video production, coding, graphics and others are listed.
Leverage your interest level and the present skill to get started as a freelancer on these portals.
#16. Online Tutor
People are in a look-out for assistance at subjects and work. Share your knowledge to help people learn new skills and topics. This can be school subjects like Maths, Physics for students.
You can tutor adults for learning management, finance topics, stock markets, investments and even setting up businesses.
#17. Start Online Consulting
You have skills that you have from your work experience and education that can be used to provide consulting services for small businesses. Your knowledge can help them tide over tricky situations.
Skills can be online marketing, coding, managing finances, relationships and whatnot. You just need to check where you can be helpful to people and businesses.
#18. Start Content Writing
All businesses, whether online or offline need content. If you’re good at writing then why not use that skill to earn money online.
All you need is basic level command over grammar and English to start writing.
#19. Be a Virtual Assistant
Solo bloggers and small businesses require helping hands at the back office for mundane works. You can be a virtual assistant and earn money without any investment.
#20. Manage Social Accounts
FB, Instagram has become huge online assets that require proper nurturing, engagement and management.
If you have past experience in managing social media or are interested in learning then you can use them to help businesses manage their social media effectively.
#21. Be a Designer
A lot of creative art, infographic goes into websites and blogs. Your graphic and designing skills can earn you a handsome amount of money.
These are some of the easiest methods that can help you start earning money. But, are they sufficient to fulfill your needs?
You need to build a solid wealth corpus to secure your future financial needs. Unless you do that the money either lies unutilized or is spent in unnecessary shopping. Which again has the potential to create a money deficit situation for you.
A prudent way would be to grow money by investing in various assets like stocks, real estates and mutual funds where you get returns on your investments and the money grows.
Best Places to Invest Money Right Now
Investing Money for Beginners
Beginners have a moot question – where to invest money now?
People give lots of suggestions and different investment options but are those best for your needs? Below are the best investment avenues for totally new beginners.
#1. 401(k) or Other Retirement Plans
People think the least about retirement savings. That is because of our spending culture, we tend to save very less for our golden years.
But, the fact is that one day or another we will be retiring from our job and the money will be limited. So, start contributing to retirement plans.
An easy way is to opt for 401(k) where your employer also contributes an equal amount. The max contribution amount is $19,500 (2020) and can be started for as little as 1% of your paycheck.
#2. Index Funds
If you are an alien to stock market investment then Index funds are a better place to grow your money in the long-term.
The money grows along with the benchmarked index passively at a lower cost compared to time-consuming and risky stock investments.
A brokerage like Charles Schwab, Fidelity and Vanguard help you invest in Index funds.
#3. Exchange-Traded Funds (ETFs)
ETFs are similar to index funds. They work on a passive investment strategy and track market index.
The difference is that ETFs are listed on stock exchanges and are traded like regular stocks. Depending on the fund that launched the ETF the minimum investment would be the last traded price that can range from $100 to $300.
However, some brokers charge a commission when you buy ETFs through their platforms while others offer them at $0.
How to Start Investing in Real Estate With Little Money
Real Estate investment can diversify your investments and lower the risk arising from a single investment. If you have little money then you can invest in real estate by;
#1. Real Estate Investment Trust (REITs)
REITs are dividend-paying stocks that you can own. It helps you invest in real estate without owning any property.
The trust in turn invests the collective money from all the stockholders in long-term leases and distributes 90% of the taxable profits in dividends.
#2. Look for Seller Financing
Seller financing is helpful if you do not get any formal loans from banks and lenders. Here the seller provides finance to the buyer and the buyer repays on the agreed terms.
#3. Look for Partnership
You can enter into a partnership to invest in a property if the price tag is higher than what you have in your pocket.
However, partnerships are subject to compatibility issues.
How to Start Investing in Stocks With Little Money
If you have little money for stock investment then you should;
Look for opening a brokerage account at a discount brokerage house. Discount brokers have a low-cost structure and charge a flat fee irrespective of the trading volumes.
Robinhood is a discount broker in the U.S. with $0 fees and no account minimums.
Zerodha is a discount broker in India offering flat brokerage fees.
#2. Look for Fractional Shares
Fractional shares are part of a full share that is created by stock splits and through dividend reinvestment plans (DRIPs).
You can connect with brokerage firms that split high prices shares. For example, Amazon shares at $1800 can be hard to purchase for everyone unless turned into fractional shares. Fidelity and Interactive Brokers provide investment in fractional shares.
Money Market vs Savings
If you do not want to invest immediately you have the option either to place your money in a savings account or money market account. Both the account types are insured by their respective authorities.
Best savings accounts are those that earn you higher interest on your balance with low or no fees. The APR depends on your bank. Few banks require you to maintain minimums that can be waived off on request.
You can keep a higher balance to earn more interest or link your checking account at the same bank. A traditional savings account offers you up to six check payments, drafts or electronic transfers per month.
Money Market Account
Money market accounts are held at banks or credit unions. The account carries the benefit of a savings account and a few of the checking accounts.
Money Market accounts require high minimums and balances, in turn, they have a higher APR than a savings account. You are allowed to make only six check payments, debit card purchases, drafts or electronic transfers per month.
They are different from the money market fund.
No doubt, presently the money-flow has grown, has a higher value and is easily accessible as compared to the 1920s. The trend will continue in the coming decades.
With the use of online channels and digital payments, money is easily accessible. Going ahead, the use of technology (crypto) and the internet will be the future of money. Where the money will be global, online, safe, and freer across borders.
But, you need to learn from the past crisis to use the money judiciously. You need to find ways to earn, save, and grow money so that your future financial needs and goals are met.