Financial Topics Archives | Page 715 of 791

Nov

2022

ICO Investing: How to Purchase Initial Coin Offerings

By Samuel Becker | Growing Wealth, invest, Investing | Comments Off

Initial coin offerings, or ICOs, are like IPOs but in the crypto space. When new cryptocurrencies make their debut on the public markets, they go through the ICO process — which is more intricate and involved than many people may believe. Given that it can pay off big to “get in early” on investments, ICOs understandably capture the attention of many crypto traders and investors.

Read on to learn more about initial coin offerings, how to invest in ICOs, where to find ICO listings, and what you should take into consideration before betting on a new crypto.

What Is an Initial Coin Offering (ICO)?

As mentioned, ICOs are similar to IPOs (initial public offerings) which mark the first time that the public can purchase a stock on an exchange. The big difference is that ICOs concern the public sale of cryptocurrencies, while IPOs concern stocks.

And just as some investors take part in IPO investing, they can likewise participate in ICO investing. That basically means buying a stock, or a cryptocurrency, as soon as it hits the market, with the hope that it increases in value.

How an Initial Coin Offering (ICO) Works

Companies go public in an effort to raise money. They’re essentially selling pieces of their ownership for cash. The same logic applies to ICOs, which are crowdfunded efforts to fund a new cryptocurrency.

As such, ICO stands for “initial coin offering,” and allows crypto investors to get in on the ground floor of a cryptocurrency startup. These investors are among the first wave piling into new crypto, and as such, stand to potentially benefit the most if (and it’s a big “if”) the crypto in question appreciates in value.

As for how an ICO actually works? It’s different from an IPO, which has a very standard process involving multiple parties and regulators. Bringing a new crypto to the market is more of a do-it-yourself process. In short, the person or team behind a new crypto outlines their plans in a white paper, explaining what the crypto is and how it’ll work.

After that, the crypto creators focus on a marketing push to get people to invest and buy into the currency. Those who opt to participate and become investors will exchange money for the new project’s coin or token.

Cryptocurrency creators collect money from some investors by making the coin available pre-ICO for sale. During this period, they typically issue coins at a discounted value, often in order to get capital to continue building out the currency.

This is, of course, a basic overview — the process can get much more granular. But this should give you an idea of how ICOs work.

Types of ICOs

Initial coin offerings can use a variety of structures to achieve their end goal: Additional financing for a crypto project. Here are a few of the main types of ICOs:

Static Supply and Static Price

An ICO involving a static supply and static price has a specific funding goal. That means that each token being sold has a preset value, and that there is a fixed supply of tokens. The tokens are then sold at the predetermined price until the supply is exhausted.

Static Supply and Dynamic Price

An ICO utilizing a static supply and dynamic pricing model does not have a specific funding goal. There is a predetermined number of tokens, however, but the value or price of those tokens can change, and consequently, the total amount of funding raised at the end of the process.

Dynamic Supply and Static Price

An ICO with dynamic supply and static pricing is one in which tokens have a predetermined value or price, but the supply is not static. Again, this would mean that there is no set funding goal, and the total raised would depend on the number of tokens sold.

3 Types of ICOs
Static Supply & Price	Static Supply/Dynamic Price	Dynamic Supply/Static Price
Preset token value	No preset token value	Preset token value
Fixed token supply	Fixed token supply	Undetermined token supply
Predetermined funding goal	Funding goal undetermined	Funding goal undetermined

How to Value ICOs

IPO valuations typically reflect careful research into the underlying company’s books and performance. But the process of valuing ICOs is different, since there is no underlying company with financial records (or history) to comb through.

As such, hype and investor sentiment represents a big underpinning of ICO valuations. Crypto assets, in general, derive their value either from functioning as cryptocurrencies, or as security or utility tokens for specific networks and systems. That makes it difficult to determine a monetary value out of the gate.

Investors typically determine the value of an ICO value based on potential uses the coin may have in the future, which could lead to price appreciation. The more hyped investors get, the higher potential values can soar, but the reverse is true as well.

Negative investor sentiment can lead to negative first-day returns for an ICO, which can impact the performance of the currency for at least six months.

That makes ICOs a notoriously risky investment. Hype men and con artists can easily take advantage of investors with little knowledge of the crypto space, and government regulators have only recently started outlining potential regulations for the industry.

Factors to Consider Before Investing in ICOs

It bears repeating: ICOs are incredibly risky — they are the opposite of safe investments. Because of that, there are some key considerations to make before putting your money on the line.

First and foremost is that investors will have little, if any protection if an ICO goes awry. As the crypto space is still largely unregulated and investors aren’t afforded many of the same protections that those in the stock market may see, there’s a real chance you could lose your money.

Finally, know that you may not receive your tokens, even if you paid for them. There are no guarantees in crypto, at least not yet, so if you’re particularly risk-averse, then ICO investing may not be for you.

How to Buy ICO Tokens in Five Steps

Wondering how to buy ICO tokens? Follow these five steps:

Step 1: Do Your Research on the ICOs

As a crypto investor, you should always be doing some homework and research on a specific token before putting your money on the line. As mentioned, this can be tricky in crypto, since there’s limited historical data and information related to many projects out there, but you should do the best you can.

In crypto, your research usually begins with the project’s white paper; you’ll want to learn everything you can about the development team behind it, and whether it has attracted much interest from other investors. If the white paper does not have details about token’s code or security features that’s a potential red flag that may require more due diligence.

Step 2: Register for the ICO

Once you’ve found an upcoming ICO that appeals to you, sign up to take part in it. This may require some legwork, but you can track down a pre-ICO list and ICO listings on numerous crypto-focused websites.

Be aware, though, that each ICO typically has different registration procedures. So, if you’re interested, poke around to learn the appropriate procedure, and follow it as needed.

Step 3: Set Aside Funds for Payment

Next, you’ll need to prepare to actually invest when you’re ready to put some money up. This means having money set aside in order to facilitate the investment.

You’ll need to have either fiat currency, such as dollars, or some other crypto ready to make an exchange, as needed (typically, either Bitcoin or Ethereum, the two biggest cryptos). You’ll also need to have money and or crypto standing by in a digital wallet so that you can make the trade.

💡 Recommended: How to Send Bitcoin to Another Wallet

And finally, be sure that you’ve joined the appropriate or correct crypto exchange for the ICO. Some exchanges only allow investors to trade certain cryptos. You’ll want to be sure the ICO you’re targeting is listed on the exchange you’re working on.

It’s also a good idea to do a little research on any platform that you plan on joining. There are factors that make a good crypto exchange, and not all are created equal.

Step 4: Make the Exchange

This part is pretty simple: Execute the trade! The specifics here will depend on the individual ICO, exchange, and procedures.

Step 5: Receive and Store Your ICO Purchase

Ideally, after the execution of the trade, your new coins will go right into your crypto wallet (whichever of the many types you choose) for safekeeping. From there, ICO investors are largely at the mercy of the market to dictate what happens with your new investment.

It may be worth it to closely watch the ICO and other news around the new crypto, so that you can make wise decisions about when or if you should sell. One upside to ICOs compared with IPOs is that there’s no IPO lock-up period preventing sales.

How to Buy Tokens After an ICO

After a crypto token completes an ICO, it’s now available for purchase on the open market. So, if you want to buy tokens that recently made their market debut, all you need to do is buy them on an exchange or through a brokerage. The key, though, is making sure you’re using an exchange that trades the token you’re looking for.

Similar to how stocks trade on the open market following an IPO, tokens are on the secondary markets following an ICO. It’s just a matter of investors making sure they’re on the right exchange to trade them.

The Takeaway

ICOs involving bringing new crypto tokens to the market, just like an IPO brings new stocks to the market. The ICO process varies from project to project, but ICOs give investors a chance to get in early on a new or emerging crypto asset. But investors should keep in mind that ICOs are risky, and do their homework before putting their money into this type of investment.

FAQ

Who can participate in an ICO?

For most projects, anyone can participate in an ICO granted they’re registered, and have a crypto wallet and cryptocurrencies to trade with. Depending on the specific ICO, prospective investors may need to join a certain exchange to facilitate the transaction, too.

What’s the difference between an ICO and an IPO?

The main difference between an ICO and an IPO is the asset that’s being debuted. ICOs involve crypto tokens or cryptocurrencies, whereas IPOs involve stocks, or shares of companies going public.

Who can launch an ICO?

Anyone can launch an ICO, granted they know what they’re doing. Because the ICO and crypto markets are lightly regulated in the U.S., anyone with a crypto project can bring a new crypto to the market.

Is an ICO legal?

Yes, ICOs are legal. But there are some considerations to make before engaging in one. Regulators in the U.S. may consider an ICO a securities offering, and as such, could enforce securities law on those engaging in an ICO. As always, it’s best to consult with a professional about the details.

What is an ICO used for?

An ICO’s primary purpose is to generate funding for a crypto project. The project sells tokens which generates money, which can then be reinvested in the project.

Photo credit: iStock/ismagilov

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Nov

2022

13 Great Haggling Tips

By Caroline Banton | Budgeting & Goals, money | Comments Off

In the United States, people tend not to bargain too much: A price is a price, period. Yes, when you are bidding on a house or negotiating the price of a car, there is typically a bit of give and take, but otherwise, not so much. In other parts of the world, however, haggling in shops and markets is an indelible part of the culture.

Maybe American consumers should borrow this global tradition. Even here in the States, haggling can result in significant savings on electronics, household goods, hotels, and clothing. Also, haggling is really about the art of negotiation, and successful haggling can work wonders for your confidence and business savvy.

Read on to learn:

• How to haggle

• Where to haggle

• The pros and cons of haggling

Then, read 13 clever tips for getting what you want at the price you want to pay.

What Is Haggling?

Haggling is a way to bargain. It’s a process of negotiation between the buyer and the seller. While almost everyone would agree on the importance of saving money, different cultures have different approaches to haggling. For example, westerners are often unaccustomed to haggling, but in less developed countries of Southeast Asia, for example, bargaining and haggling is expected. Locals will engage in a back and forth on price for everything from fresh food in markets to hotel prices in order to save money.

Haggling can take some practice because it requires a measured approach and a strategy. The more you haggle, the more successful and confident you become at it. What’s more, as you build your haggling skills, you’re likely to unlock more discounts. In fact, many people enjoy haggling and find it to be an easy way to save some money.

Recommended: 15 Creative Ways to Save Money

How Does Haggling Work?

If you’re wondering how to haggle successfully, let’s consider a specific example. Imagine you have your eye on a new car. The price of the car is $25,000, but you only have a budget of $22,000. To try to negotiate a price of $22,000, first determine if $22,000 is a fair price for that car. Look up the make, model, and year in Kelley Blue Book and check to see at what price other sellers are listing the same exact car.

If you determine that $22,000 is a fair price, a savvy haggler would offer a somewhat lower price, perhaps $20,000. At the same time, the buyer would make a case as to why their offer is fair. They might point out damage to the paintwork or worn tires. The seller may counter the buyer’s offer with $24,000, to which the buyer responds with $21,000. Eventually, the two parties may meet somewhere in the middle and agree to the price of $22,000. At least, that’s the theory of how haggling works.

Places Where You Can Haggle

Haggling, or negotiating, is acceptable in many contexts, not just when buying a car, a home, or in salary negotiations. Here’s a list of other places to haggle:

• Uncommercialized markets and craft fairs

• Retailers

• Suppliers

• Resale platforms and dealers

• Appliance repairs

• Home improvement services

Places Where You Likely Cannot Haggle

Haggling is not socially acceptable in many commercial enterprises. Here’s where you typically should not to haggle:

• Many commercialized businesses

• Restaurants

• Supermarkets

That said, if you were at a Target or a department store, and were trying to buy an item that is a floor sample, is damaged (scratched or torn, say), or has some other reason that might merit a price reduction, it’s fair to politely try to haggle your way to a discount.

Advantages of Haggling

The obvious advantage of haggling is paying less for something you want, but there are a couple of other pros as well.

• For sellers, haggling may allow them to sell more products and yield better returns.

• Haggling is a way to practice negotiation skills and build confidence.

13 Money Saving Haggling Tips

Now, dive into the details on how to haggle. Here are 13 more tips on how to approach haggling that can help you save money.

1. Adopt a Strong Mindset

Learn to control your compulsive or impulsive spending. If you feel as if you “have to have” an item, be it a car or a handbag, it will be even harder to resist a high price or a bad deal.

Adopt a strong money mindset and know the difference between needs and wants. Tell yourself you won’t overpay, regardless of how badly you want the deal to work out. You can always find something similar at a better price.

2. Do Your Research

What is a good price for a purchase you’re planning on making? Before you enter into negotiations, you should know the item’s market value. Look up other similar items to see what they are going for. In the case of a car, refer to the Kelly Blue Book. For other items, an online search should yield comparable items with prices to inform your decision.

3. Consider Other Factors and Items in Your Haggling

How to bargain effectively can call for creative thinking. For example, if you are buying a car, you could offer cash to the seller instead of paying in installments. Or you might consider trading an item you have with a seller in order to secure the item you want.

4. Have a Target Price in Mind

It can help to know your haggling limits in advance. In the example of a car negotiation given earlier, the buyer had a target price in mind that they kept under wraps. They attempted to reach agreement at the desired price with the seller by first offering a lower price than they were really willing to pay. Then, they and the seller gradually came to a mutually satisfactory price. Having a strategy like this when haggling can help you avoid the risk of paying more than you want to.

5. Let the Seller Know Your Budget

Alternatively, a haggling tactic can be to let the seller know your budget at the outset. For example, you might say, “I love that rug but I see that it’s $750, and I can only pay $600. Is a deal possible?” That way, you are taking control of the situation, and the seller can take it or leave it.

6. Find Out the Condition of the Item

Just because you’re haggling, it doesn’t mean that you drop all of your usual smart-shopper moves. Don’t hesitate to inquire about the item in detail; it’s important to ask questions before making a purchase. Its condition is critical to the item’s value. You may be able to use any blemishes or wear and tear to negotiate a lower price.

7. Be Confident

Be direct about the fact that you are negotiating and are looking for a discount. Approach the seller with confidence, rather than apologizing for trying to get a better price. This can give the impression that you know what you are talking about and are serious. A seller may well be more likely to consent to a confident buyer’s request or offer.

8. Avoiding Insulting the Seller; Don’t Lowball

When haggling, always respect the other party. Lowballing a seller can be insulting because the implication is that you are not taking them seriously or you think their merchandise is wildly overpriced. Have a good idea of the market value of an item before you make your lowest offer by researching other similar items and their prices.

One rule of thumb is not to expect a discount of more than 25% when haggling. However, there are some forums (like eBay’s “Best Offer” listings or on Poshmark) where you might get lucky with an offer of closer to 33% off the listed price.

9. Time it Right

Many salespeople have monthly sales quotas, and, as the end of the month approaches, they may be more inclined to accept a lower price. To find the best deals, hold off on haggling until the end of the month. Also, sellers may want to move inventory at the end of a season or if the item is going out of style. If your seller wants to get rid of inventory, you are more likely to get a better deal.

10. Make Life Easy for the Seller

Here’s another trick for how to bargain effectively: Let the seller know that you can make the deal easy and quick for them. Explain that you’ll take possession of the item immediately, or that you can pay cash. The less work the seller has to do to move inventory and the less a transaction costs them, the more inclined they will be to accept your offer.

11. Turn on the Charm

A little flattery works wonders. Believe it or not, part of knowing how to negotiate a better deal involves being as polite and friendly a customer as possible. Be interested in the person you are talking to and compliment them on their business. Another good strategy is to listen more and talk less. Rather than asking questions that require a yes or no answer, ask open-ended questions. For example, instead of asking “Can I make you an offer?” ask “How flexible are you to negotiation?” In addition to getting the seller to engage, you learn more about their needs and are in a stronger position to bargain.

12. Know When to Walk Away

Haggling won’t always work in your favor. Be prepared to throw in the towel if the seller does not agree to your final offer. There’s no point going in circles or thinking if you wait long enough, the seller will relent. And don’t let any frustration or temper come into play.

Sometimes, it’s best to just walk away. And you never know: Some sellers may see you leaving and wind up taking your best offer after all, rather than lose the deal.

13. Don’t Take Things Personally

Haggling is simply business. It is not a reflection of the buyer or the seller. If you don’t reach agreement on a price for an item, chalk it up to experience. People don’t always agree on things, and nor should they. Don’t let feelings of failure creep into the picture.

The Takeaway

Haggling is the process of negotiating a price for an item or service. Except for situations like negotiating a house purchase or bargaining down the price of a new car, when some back-and-forth is a given, Americans tend not to be hagglers. However, there may be plenty of situations when you can haggle and get a better deal, whether on a floor model at a big box retailer or a vintage chair at an antiques fair. By knowing the right polite haggling moves, you may be able to snag some satisfying discounts.

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FAQ

Is haggling illegal?

Haggling is not illegal, but in the United States, there are contexts where haggling is not socially acceptable. These include commercial businesses, such as restaurants and supermarkets.

Is haggling frowned upon?

Haggling isn’t necessarily frowned upon, provided it’s done politely and in the proper context. In some cultures, it is even expected and part of the buying experience. However, lowballing is universally considered insulting. A rule of thumb for how to bargain is to never offer less than 25% percent of the price tag.

Can you return something you haggled over?

If an item does not meet your expectations, even if you managed to get it at a discount price, you can try to return it.The terms of the sales agreement, if any, will outline the legal obligations of the seller. If there is no written agreement or receipt with returns stated, the seller is under no obligation to accept the return or to give you your money back.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Nov

2022

What Is a Luxury Item and Tips for Budgeting for One

What Is a Luxury Good?

By Alene Laney | Budgeting & Goals, money | Comments Off

Luxury goods are sometimes called the finer things in life. Think about those fancy sports cars, watches, handbags, shoes, and jewelry that can cost a mint. Those beautiful objects of desire are not at all necessary to support basic human needs, but they may make life a lot more enjoyable.

Demand for luxury goods is typically driven by perceived value (that is, being a status symbol) as much as product quality and design. Brand awareness is an important aspect of the luxury market. These high-end items from exclusive brands are expensive, putting them out of reach of many consumers, which can add to their allure.

If you’re simply curious about luxury goods or contemplating buying some, read on to understand what makes them special. You’ll learn:

• What is a luxury good?

• What makes luxury items different from other goods?

• Examples of luxury goods.

• The pros and cons of buying luxury items.

• How to afford luxury goods.

What Makes a Luxury Good ‘Luxury’?

Luxury items are defined by their exclusivity and higher cost, which limits access to them. To put it simply, they are expensive! Once a luxury item becomes more readily available at a lower price point, it may lose its appeal, and demand wanes.

Different cultures around the globe have varying tastes about what luxury goods are. That is, what is considered a highly desirable luxury good in one society may not be as valuable in another. However, there are brands that have become international icons of living well; you’ll learn more about them shortly.

Luxury goods are linked to the economics term “conspicuous consumption,” which occurs when consumers buy higher priced goods to display their wealth and class status. People who want to publicly communicate their economic and social status will buy luxury goods that signal that message. Purchasing luxury goods is typically tied to a consumer having more expendable cash. The item may not exactly be affordable given their income, but it could be more accessible as a splurge as their earning power rises.

Examples of Luxury Items

What exactly is a luxury item? There are lots of examples in the $300 billion industry. Luxury products have traditionally included aspirational items, such as:

• Yachts

• Top-of-the-line cars

• Fine and antique furniture

• Art

• Furs

• Watches

• Jewelry

• Designer clothing and handbags

• Wine

• State-of-the-art electronics

• Cosmetics and fragrances

You’ll likely see some familiar names in the luxury goods market. Many companies have established themselves as luxury brands with their exclusive products.

Some of the top, recognizable luxury brands include:

• Porsche

• Ferrari

• Chanel

• Hermes

• Balenciaga

• Alexander McQueen

• Louis Vuitton

• Burberry

• Gucci

• Cartier

• Tiffany & Co.

• Rolex

• Dior

• Prada

• Bulgari

When you see those names when shopping, you probably are looking at what are known as luxury items.

Pros of Purchasing Luxury Goods

If you’re looking at purchasing a luxury item for the first time, there’s more to it than its price tag. Purchasing a luxury item can bring other benefits. These can include:

• Status

• Better quality products

• Better service at retail locations or service centers

• Better resale value than other goods

• Strong value appreciation in some goods (such as jewelry or art)

• Exclusivity

Cons of Purchasing Luxury Goods

Conversely, purchasing a luxury item isn’t always a good idea. Some of the downsides to purchasing luxury goods include:

• High cost

• Money used to purchase a luxury good could be used elsewhere

• Can lead to more conspicuous consumption

• Depreciation on certain goods may be high

• Can undermine confidence; some people wind up feeling inauthentic (as if they are “faking it”) after spending a lot of cash on luxury items

Quick Money Tip:When you overdraft your checking account, you’ll likely pay a non-sufficient fund fee of, say, $35. Look into linking a savings account to your checking account as a backup to avoid that, or shop around for an online bank that doesn’t charge you for overdrafting.

Luxury Goods vs Normal Goods: What’s the Difference?

Buying normal goods means you are buying items whose cost increases at the same rate as your income increases. If you, say, shopped for clothing at garage sales to save money at the beginning of your career, and now you spend money on clothing at a traditional retailer, your consumption increased to the higher-priced clothing at the same rate as your income increased. These goods are within a reasonable range given your earning power.

Compare that with what is a luxury good. In this case, the cost of consumption increases, but not at the same rate as income. The price tag for a luxury item is often exponentially more than could be afforded by one’s salary raises.

Luxury Goods vs Inferior Goods: What’s the Difference?

According to the principles taught in economics class, an inferior good is one whose consumption decreases as a consumer’s income increases. If you ate ramen in college, for example, but no longer consume them now that you’re making more money in your career, that pack of noodles is an example of an inferior good. Your consumption of it decreased as you made more money.

Typically, with luxury goods, consumption increases with a higher income; with an inferior good, consumption decreases with a higher income.

Tips for Affording a Luxury Item

If you’re gunning for that aspirational luxury item and you weren’t born with a hefty trust fund, you’ll need to adopt some stellar financial habits to snag one (or more) of these pricey items. You can learn how to afford luxury items without paying full price for them. Here are some tactics to try.

Saving for a Luxury Good

Saving up for a luxury item and then paying in cash can be a good strategy. Whether the object you’re craving is a handbag or a sports car, you won’t feel guilty about spending money when you’ve stashed the money away for it and can pay without creating credit card debt. If you automate your savings for the luxury item, you may well reach your goal without too much effort.

Waiting for Sales

Even luxury goods can go on sale, though perhaps less often than with lower-priced items. Even if you miss their sales, you may be able to find some premium items discounted at outlet stores.

Avoiding Trends

When saving for that luxury item, it can be wise to avoid trendy luxury products. Those probably won’t stay in style for long, and if you’re making a major purchase, it can be smarter to spend your money on things that will last.

Recommended: Tips to Stop Overspending

Renting Luxury Items Over Buying

You might want to consider renting a luxury item rather than paying loads of money to own it. For instance, you could lease a luxury car for a while and see if you truly love it. And there are many businesses that rent designer clothing and handbags, such as Rent The Runway and Bag Borrow or Steal. That can give you a taste of luxury at a more affordable price point.

Lowering Your Other Expenses

If you’re really set on affording a luxury item, see where else you can cut back on spending. Knowing you’d rather own a luxury car than go out every weekend can help you feel more motivated to cut back on dining and entertainment expenses.

Buying Pre-Owned

Another way to afford luxury items is to buy ones that have been pre-owned. From BMWs to Louis Vuitton handbags, there’s a large marketplace for gently used posh goods. How to afford luxury items can be a matter of being the second owner rather than the first of the item you desire.

The Takeaway

Now that you know what a luxury good is, you probably realize that such items are usually quite costly. They can also be of superior quality and retain their value better. Owning them can also be an ego boost and a source of pride.

Saving to obtain luxury goods can help you cultivate good financial habits, which in turn can help you reach other goals and build wealth.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.20% APY on SoFi Checking and Savings.

FAQ

Why do people buy luxury goods?

Luxury goods can signal exclusivity, wealth, and a higher social status. People who buy luxury goods typically want to communicate this to themselves and others. Also, luxury items are often very well made and can last for many years.

Do luxury goods have high resale value?

Luxury goods, especially when in excellent condition, can have a high resale value. Some brands, such as Chanel and Hermes, have a better resale value than others. Jewelry by well-known brands (like Tiffany & Co.) tend to hold their value well too.

Does luxury always mean expensive?

A luxury item is typically highly desirable and very exclusive, which is usually tied to the amount of money it costs to obtain it. However, many luxury brands produce cheaper alternatives of their signature products to sell to more consumers at a more affordable cost. The Coach outlet stores are one example that luxury items don’t always have to be expensive, and the Mercedes A220 starts at about $35,000.

Photo credit: iStock/MoustacheGirl

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

SoFi members with direct deposit activity can earn 4.20% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.20% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 10/31/2024. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

SOBK0822026

Nov

2022

Cheap Ways to Live: 12 Low Cost Housing Alternatives

13 Cheap Ways to Live

By Emily Greenhill Pierce | Budgeting & Goals, Financial Independence, money | Comments Off

The cost of housing is the biggest living expense for most people, and lately, it’s been rising fast. In 2022, housing prices were expected to shoot up 11% over the prior year, according to the National Association of Realtors (NAR), and modest gains are forecast for 2023 as well.

If you’re struggling to make ends meet, finding cheaper housing alternatives could be the solution to mending your money woes. There are less expensive ways to live that don’t involve selling your worldly possessions and couch-surfing indefinitely. With a little creativity, and a willingness to simplify your life, you can find affordable, comfortable housing.

Read on to learn:

• What is considered affordable housing?

• How to find and live in cheap housing?

• How can you save money on housing?

What Is Considered Affordable Housing?

The average American spends $1,784 per month on living accommodations. A sound financial goal is to allot 30% of your gross monthly income toward your housing budget, including electricity, heat, and water.

The cost of living by state can vary tremendously, but with rents and utilities rising across the country, the suggested 30% rule can be unrealistic. In certain cities and areas with a high cost of living, housing can eat up 50% of a person’s budget, straining their ability to save and meet financial goals.

13 Cheap Housing Alternatives

When thinking about the cheapest ways to live and trying to open up some breathing room in your budget, ask yourself, “Is my housing situation affordable?” If you are living paycheck to paycheck and not saving, your living situation may have to change. Fortunately, there are a range of possibilities when it comes to seeking cheap housing.

Here are 13 housing alternatives to help cut the cost of living and bring balance to your budget.

1. Moving to a Cheaper Area

When looking for cheaper accommodations, one of the biggest moves you can make is a literal one: Move to a place with lower housing costs.

For instance, the costs of the Los Angeles housing market are typically far more than in rural Idaho. Your choice of locale can add hundreds, sometimes thousands of dollars to your monthly bill.

If your job and life situation permits, you could look for a less pricey neighborhood nearby or something more affordable that is within commuting distance of your work. If that doesn’t help make ends meet, it might be wise to consider relocation to another state where the rents are cheaper.

Unfortunately, relocating can be expensive. It can be difficult to tabulate how much money you’d need to move. Resettling in another state may involve the cost of typical moving expenses and supplies, getting a new license and vehicle registration, and typical costs.

2. Living in a Recreational Vehicle (RV)

The use of recreational vehicles surged during the pandemic, with people itching to get out of their quarantines and onto the open road. Having an RV can do more than satiate your wanderlust, it can be an affordable housing option.

While a new RV is not cheap, you can find used ones for around the price of a used car. Despite their somewhat restrictive quarters and the constant need for parking, the sense of freedom, including financial, could be worth it, especially if you’re a nature lover. While it may not be a forever move, it can give your budget a break for a while.

3. School Bus Homes

Here’s a quirky way to live more cheaply for a period of time: Get on the bus. A converted school bus is cheaper than an RV. A used school bus can run between $3,000 and $10,000 dollars.

The interior renovations are the biggest cost factor. A school bus conversion, complete with hookups for electricity and water, can cost around $30,000.

Parking can be an issue, so do your homework first on everything from national forests to a friend’s roomy property in terms of where to pull up.

💡 Quick Tip: When you overdraft your checking account, you’ll likely pay a non-sufficient fund fee of, say, $35. Look into linking a savings account to your checking account as a backup to avoid that, or shop around for an online bank account that doesn’t charge you for overdrafting.

4. Living on a Boat

Perhaps you prefer life on the water vs. life on the road. In that case, choosing a boat as your primary residence could satisfy your inner sea captain and your financial needs.

Not including the cost of a boat, maintaining your nautical lifestyle can run an average of $2,000 to $3,000 a month. But you can reduce your costs by spending more time at sea and less on marina fees. Of course, if you have a Monday-to-Friday office job, this will be a challenge. For those with flexible or work-from-home schedules, it could work.

5. Living Abroad

With the cost of living rising in America, some people are looking beyond the borders for affordable housing. Your dollar can go far in places like Vietnam, Costa Rica, and Thailand, as long as you can work and procure the proper visas.

However, establishing a permanent residency in a foreign country can be tricky, and shipping your stuff internationally can be a hefty expense. You’ll want to do the research and do the math before making a move, but it could be an option — and an adventure — for some.

6. Renting a Guest House

You can lower your housing costs by moving into a garage apartment or a mother-in-law suite in someone’s home. What you sacrifice in space and privacy can be made up in savings on rent and utilities. If a friend or acquaintance has one to let, great. Also look at the usual rental listings for options on this front.

Recommended: How Much Should I Spend On Rent?

7. Living in a Mobile Home

What else is among the cheapest ways to live? Purchasing or renting a mobile home can be way more affordable than an apartment or house. Utilities are sometimes included, but be sure to factor in the costs of the lot fees, community fees, and other charges imposed by the trailer park landlord.

8. Moving into a Tiny Home

Tiny houses have exploded in popularity, popping up on TV shows and social media feeds. The term describes compact dwellings of no more than 600 square feet or so, with many of them being just 225 square feet. If you don’t have enough of a down payment for a traditional house, a tiny home offers a more budget-friendly alternative and hip design options. The national average price for a tiny home is $52,000, a fraction of the figure for a full-sized home.

Not ready to commit to close quarters? Renting a tiny house can run between $600 and $800, still cheaper than a lot of apartment rentals. But you may have to pay for storage for all your oversized belongings.

9. Living in a Shipping Container Home

Believe it or not, one of the newest cheap ways of living can involve cutting-edge high design. Repurposing shipping containers into industrial-chic small homes has become a trend lately. These containers are way cheaper than a house and can be configured in unique ways, combining multiple containers for more square footage.

In terms of how much you’ll spend, converting a container to a livable space could cost you up to $45,000 per unit.

10. Living as a Live-In Caretaker

If you’re looking for employment as well as more affordable housing, being a live-in caregiver can be an ideal situation. You could look after an elderly or disabled individual in exchange for a free room and a monthly salary. Another option is being an au pair or nanny, which can work well if you love kids.

11. Being an On-Site Property Manager

In terms of finding cheap ways to live, you might explore becoming an on-site property manager if you’re handy. You’d be responsible for superintendent-type duties — garbage removal, cleaning common areas, and the basic upkeep of the building — in exchange for low-cost or free rent.

12. Renting Out a Room in Your Home

Here’s a way to save on housing costs that flips the script. If you are fortunate enough to have a spare room in your house or apartment and don’t mind having a roommate, renting out your extra space can cut your expenses significantly. Just be sure to properly vet the renter before agreeing to an arrangement.

13. Move in with Friends or Family

If you need to cut housing costs to the barebones (perhaps you’re trying to financially survive a layoff), think about family members or close friends who could make room for you. In some cases, you may be able to pay no rent but contribute to the household via cooking, cleaning, and other chores. While a temporary move, it can help you.

While likely a temporary move, it can give you time to break out of habits that make you bad with money and prepare to get your own place again.

The Takeaway

Housing costs can take a big bite out of your budget. If you want to save money or stop living beyond your means, reevaluating your housing situation is a great place to start.

If you are willing to be flexible, and a little unconventional, you can secure an affordable home that suits your lifestyle and your bank account.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.20% APY on SoFi Checking and Savings.

FAQ

Is living cheaply worth it mentally?

Living cheaply and within your means can typically bring financial peace of mind and allow you to save for the future. However, if taken to an extreme, frugality can cause some people a high level of stress.

What are the hidden costs of living in affordable housing?

While affordable housing can save you money down the line, there are expenses such as down payments, first-and-last month’s rent, security deposits, and the costs of moving or storage units to consider. Also look out for broker’s fees when renting if cheap ways to live is your goal.

Are there monthly rent payments at mobile homes?

Yes, you can rent a mobile home by the month. Be sure to ask the landlord about common fees, who covers utilities, and other potential additional costs. Different properties have different policies, and you don’t want any surprises if you move in.

Photo credit: iStock/Marje

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

SoFi members with direct deposit activity can earn 4.20% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.20% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 10/31/2024. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

SOBK0822036

Nov

2022

What Are Bitcoin Mining Pools?

By Brian Nibley | Growing Wealth, invest, Investing | Comments Off

Bitcoin mining pools provide a way for multiple parties to “pool” their efforts when mining Bitcoin. Over time, mining Bitcoin has become increasingly difficult and resource-intensive. As such, pooling resources can make it easier and cheaper to become a Bitcoin miner.

In a Bitcoin mining pool, many network participants combine their computing power into one collective effort. The block rewards are then split among the pool members in proportion to the amount of computing power they contributed.

How Does a Mining Pool Work?

The mining process for a proof-of-work cryptocurrency like Bitcoin involves numerous miners attempting to find and solve a block on a blockchain network. The first miner to find a block receives the rewards for that block in the form of newly minted Bitcoin. Currently, the block reward is 6.25 BTC. It also takes around 10 minutes to mine one Bitcoin as a part of a pool.

💡 Recommended: Proof-of-Work: How It Works

As more and more miners join the network, however, mining difficulty rises. This is thanks to one of the ingenious aspects of the Bitcoin protocol, known as the difficulty adjustment.

Approximately every two weeks, mining difficulty will rise or fall according to how much hashing power is currently on the network. If the hash rate is higher, difficulty will rise, and the lower the hash rate, difficulty will fall.

In general, a high hash rate is good because it helps keep a crypto network secure. But with today’s hash rate hovering near record highs (and tending to rise higher over time), finding a block as an individual miner has become difficult for all but the largest of miners with the most powerful equipment.

That’s where Bitcoin mining pools come in.

A crypto mining pool gathers together connections from miners, potentially around the world, that could be all over the world and pools their hash rate together. This way, they are all mining at a higher level, giving them better odds of solving a block.

After a block has been solved, the rewards are split up among mining pool participants according to how much computing power each contributed.

This calculation is made using a set “Share Difficulty” for each miner and a “Share Time” for the pool. Basically, pools establish a time when hashes will be submitted by all participants, while also assigning a difficulty to each individual miner (more powerful miners have a higher difficulty).

All miners will automatically send a “share” of their hashes at set intervals, e.g., every five seconds, with miners who contribute more receiving a larger number of shares each time according to their higher difficulty rate. Pool participants are then paid out with block rewards proportional to their shares.

Is a Bitcoin Mining Pool Worth it?

For the average person looking into mining Bitcoin, a miner pool may be the only feasible option if you hope to earn a return. But when it comes to asking “is a Bitcoin mining pool worth it,” it all depends on how the term “worth it” is defined.

For those who believe in Bitcoin technology and simply want to help the network thrive by processing more transactions, mining might be worth engaging in, even if it’s not profitable.

For those who are looking to make a profit, however, the answer is more complicated.

Mining is a complex and difficult process for all but the most technical of crypto users. While there are services that help make the process easier for the average person to get into, there are still many nuanced factors that contribute to whether or not mining will be a profitable endeavor.

Those factors can include, but are not limited to:

• Cost of equipment

• Cost of electricity

• The amount of time it will take to recoup equipment costs

• How difficulty adjustments might impact profitability

• How BTC price fluctuations might impact profitability

• When it will become necessary to upgrade to new computers or machines

These considerations have to be calculated and recalculated if a miner wants to stay profitable. There are a lot of unknowns, particularly concerning the fluctuation of Bitcoin prices and difficulty adjustment, which are constantly changing.

When Bitcoin was first created, the calculations involved in mining were so simple they could be accomplished by the average laptop computer.

But over time, the calculations became more complex, eventually requiring high-powered graphics-processing units (GPUs). Today, the majority of mining is mostly done with advanced Application Specific Integrated Circuit (ASIC) machines. These are computers created for the express purpose of mining Bitcoin.

The hardware required is constantly evolving. Every so often, existing machines become obsolete due to difficulty adjustments. An ASIC that was powerful enough to be profitable six months ago might not be able to produce enough coins to match the cost of electricity needed to run that same ASIC today. When this happens, miners must acquire new, more advanced hardware.

Finally, it should be noted that mining is perhaps the most difficult way to acquire Bitcoin or any other mineable cryptocurrency. The easiest way is to simply buy cryptocurrency on a crypto exchange.

💡 Recommended: How Does a Crypto Exchange Work?

Functions of a Bitcoin Mining Pool

The primary function of a Bitcoin mining pool, or any cryptocurrency mining pool, really, is to make mining more accessible to prospective miners no matter what resources they have at their disposal.

Secondarily, mining pools can serve as a sort of introduction to mining for beginners who don’t have the know-how to try and get started on their own. In effect, pools may help you learn the ropes of mining without making too much of an investment in equipment and resources.

What Is the Best Bitcoin Mining Pool?

There are dozens of Bitcoin mining pools out there, and for the most part, there’s not a whole lot of difference between them. Besides the small fee they may charge participants, pools only differ based on whether or not they are open to the public and what proportion of the network’s total blocks they mine on average.

Some of the world’s largest Bitcoin mining pools are located in China and include names like F2Pool and Antpool. Together, those two pools mine 36.5% of all Bitcoin, as of 2022. The biggest pool is Foundry USA, which mines almost 25%.

How to Join a Bitcoin Mining Pool

Bitcoin pools allow users to get started mining with any amount of mining power. The process of joining a Bitcoin mining pool involves programming mining software to direct its efforts to a particular pool, which can be done in a few simple steps:

1. Choose which pool you want to join.

2. Add the stratum addresses of the selected mining pool to your mining software client.

3. Connect the wallet you wish to deposit mined coins into.

4. Configure your mining client for your chosen mining pool.

Finally, the information needed to complete this process will be provided by the pool itself.

What to Consider When Choosing a Cryptocurrency Mining Pool

Joining a Bitcoin mining pool will have its pros and cons, so there are some considerations to make before diving in.

First, there are some clear positives to joining a mining pool. The most obvious, as discussed, is that they are beginner-friendly ways to get into mining, and you don’t need a lot of expensive equipment to get started. And since you’re pooling your resources, there’s probably a better chance that you’ll end up seeing rewards in some shape or form, which may be much more difficult to do if you’re flying solo.

On the other hand, a key consideration is that you likely won’t make much, if any, money. Any coins you do mine will get divided up, and you could be disappointed with what you take home. There may also be fees to join a pool, so you’ll want to do some research on any pool you’re thinking of joining.

Finally, don’t forget that mining isn’t free. You’re using resources, like electricity, to contribute your computational power to the pool. Even if you don’t take home any coins, you may still be burning money.

Mining Pools Beyond Bitcoin

There are numerous types of mining pools out there, not just for Bitcoin. For example, there are pools for mining Ethereum; but note that Ethereum has recently moved to a proof-of-stake model, so you can no longer mine it.

If you’re interested in joining a mining pool, an internet search will yield some results. But know that many cryptos are moving away from mining-based protocols due to their resource demands. So, it may be more difficult to find a pool today than it was a couple of years ago.

The Takeaway

A cryptocurrency mining pool provides a way for multiple smaller miners, or even beginners, to pool their resources and combine their hashing power. Mining at this higher collective hash rate benefits everyone in the miner pool as it increases the odds of earning rewards, and allows miners to leverage whatever level of computing power they have at their disposal.

Those interested in learning about the mining process first-hand could consider experimenting with smaller mining machines and joining a mining pool. But for the average person looking to acquire Bitcoin, buying cryptocurrency from an exchange might be a lot simpler.

FAQ

Can I mine Bitcoin without joining a pool?

You can mine Bitcoin without joining a pool, but most individual miners likely lack the equipment and computing power to effectively turn a profit through mining. As such, many people may benefit from joining a pool to increase their chances of actually realizing a return.

Can anyone join a mining pool?

Yes, anyone can join a mining pool, as they’re designed to be open to miners with all sorts of “rigs,” or no matter where they’re physically located in the world.

How do mining pools share rewards?

In simple terms, a pool that is rewarded for its mining activity divides up the reward (or coin) into shares, and doles it out based on how much work each member contributed to the pool. The more work your computer puts into the mining pool, the bigger your share, in other words.

Photo credit: iStock/MicroStockHub

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Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.

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Terms and conditions apply. Earn a bonus (as described below) when you open a new SoFi Digital Assets LLC account and buy at least $50 worth of any cryptocurrency within 7 days. The offer only applies to new crypto accounts, is limited to one per person, and expires on December 31, 2023. Once conditions are met and the account is opened, you will receive your bonus within 7 days. SoFi reserves the right to change or terminate the offer at any time without notice.

First Trade Amount		Bonus Payout
Low	High	Bonus Payout
$50	$99.99	$10
$100	$499.99	$15
$500	$4,999.99	$50
$5,000+		$100

SOIN0922053

ICO Investing: How to Purchase Initial Coin Offerings

What Is an Initial Coin Offering (ICO)?

How an Initial Coin Offering (ICO) Works

Types of ICOs

Static Supply and Static Price

Static Supply and Dynamic Price

Dynamic Supply and Static Price

How to Value ICOs

Factors to Consider Before Investing in ICOs

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How to Buy ICO Tokens in Five Steps

Step 1: Do Your Research on the ICOs

Step 2: Register for the ICO

Step 3: Set Aside Funds for Payment

Step 4: Make the Exchange

Step 5: Receive and Store Your ICO Purchase

How to Buy Tokens After an ICO

The Takeaway

FAQ

Who can participate in an ICO?

What’s the difference between an ICO and an IPO?

Who can launch an ICO?

Is an ICO legal?

What is an ICO used for?

13 Great Haggling Tips

What Is Haggling?

How Does Haggling Work?

Places Where You Can Haggle

Places Where You Likely Cannot Haggle

Advantages of Haggling

Get up to $300 when you bank with SoFi.

13 Money Saving Haggling Tips

1. Adopt a Strong Mindset

2. Do Your Research

3. Consider Other Factors and Items in Your Haggling

4. Have a Target Price in Mind

5. Let the Seller Know Your Budget

6. Find Out the Condition of the Item

7. Be Confident

8. Avoiding Insulting the Seller; Don’t Lowball

9. Time it Right

10. Make Life Easy for the Seller

11. Turn on the Charm

12. Know When to Walk Away

13. Don’t Take Things Personally

The Takeaway

FAQ

Is haggling illegal?

Is haggling frowned upon?

Can you return something you haggled over?

What Is a Luxury Good?

What Makes a Luxury Good ‘Luxury’?

Examples of Luxury Items

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Pros of Purchasing Luxury Goods

Cons of Purchasing Luxury Goods

Luxury Goods vs Normal Goods: What’s the Difference?

Luxury Goods vs Inferior Goods: What’s the Difference?

Tips for Affording a Luxury Item

Saving for a Luxury Good

Waiting for Sales

Avoiding Trends

Renting Luxury Items Over Buying

Lowering Your Other Expenses

Buying Pre-Owned

The Takeaway

FAQ

Why do people buy luxury goods?

Do luxury goods have high resale value?

Does luxury always mean expensive?

13 Cheap Ways to Live

What Is Considered Affordable Housing?

13 Cheap Housing Alternatives

1. Moving to a Cheaper Area

2. Living in a Recreational Vehicle (RV)

3. School Bus Homes

4. Living on a Boat

5. Living Abroad

6. Renting a Guest House

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