5 Easy Life Hacks to Massively Boost Your Disposable Income

Disposable Income is what you have left from your pay after you’ve tossed the rest up the wall on bills, basic foods to live, essentials, and given the tax man his due.

For most people in the UK, this number will be around zero – hopefully, on the positive side of zero – while for many the number will be deep in the red – payday loan time.

We are comfortable financially because we are investors – and we can afford to be investors and buy stocks, property and other people’s debt because we make sure our disposable incomes are well above zero each month.

This video covers the basic life hacks you can use to ratchet up your disposable income by several hundred quid a month, so that you can be in a position to be a serious investor – or if the fancy takes you, to have a load more money to toss up the wall.

5 easy life hacks to massively boost your disposable income… let’s check it out!

Editors note: Links to many of the cash boosting bonuses mentioned below can be found on the Offers page, including one of the top Peer-to-Peer Lending platforms in the UK: open a new account with RateSetter for as little as £10 you will get a £20 cash bonus!

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Life Hack #1: Take Advantage of All the Free Money on Offer

By far the easiest way to crank up your disposable income is to take advantage of all the free money being given away by companies vying for your custom.

If you regularly take advantage of this type of deal, of which there are always more and more of, you will have more disposable income to play with.

Investment Platform Bonuses

Including all of links that are on MoneyUnshackeld.com, linked below – you can sign up to an investment platform and they give you £50/£100/£200 cash reward for your trouble.

This is making extra money from a thing you should be doing anyway – investing for future financial freedom.

Switching Banks

At time of writing, HSBC are giving away £175 to new customers who open an account with them, and First Direct are giving away £100 for the same thing.

These deals may not be live by the time you are read this, but this proves our point – there are constantly new deals of this type on the market, and in theory you could switch your bank account every month and scoop up those wicked bonuses.

£175 just for switching a bank account one month – that’s more than most people’s disposable income to begin with!

In fact, while writing I thought, “really it’s criminal that £175 is just sitting there crying out to be taken”, so I actually did take 5 minutes to switch my bank account to HSBC. £175 headed my way for doing jack-all!

Change Your Providers

Not only to save money on the cost of bills, but also to take advantage of more sweet cash hand-outs. Octopus Energy, who I have also signed up with, give you a £50 cash reward when you switch your gas and/or electricity to them.

Get £50 back with Octopus Energy

There will be other similar cashback offers all over the internet that could also be taken advantage of!

More cash for doing practically nothing. Plus, they happen to be one of the cheapest providers on the market, and rated Excellent by 92% of people on Trustpilot for their customer service.

This offer is only available through special links like the one on our website – don’t sign up direct or you’ll miss out!

Credit Card Stoozing

A way to start saving more now – you get a 0% credit card and use it to pay for all of your expenses.

This leaves your current account balance healthier, and you have more cash to play with. Stoozing could even be used for investing for those who are brave.

This is only a strategy for the financially confident and should not be tried if you have had problems with debt in the past, or aren’t good with money management generally.

You will have to pay back the credit card balance eventually, before it slips from the 0% rate to something far higher, usually after 2 or so years.

The brilliance of credit card stoozing is that you can invest the money you would have spent on expenses now, and make interest or dividends from it. So long as you have a plan to pay that balance back at the end of the deal term.

Andy took advantage of a 0% interest period for 4 years when he purchased his sofas. By investing the money he otherwise would have had to spent upfront he effectively reduced the cost of the sofas by around 25%. Sweeeeet!

Don't fear your bills - make money from them!

Earn While You Spend

Many websites offer you cash back on your receipts, or when you take out a subscription or other purchase online.

The site we use is called TopCashback – Andy actually made £1,200 on this site by buying things that he was going to buy anyway. Some people have reportedly made many thousands!

Life Hack #2: Cashflow Investing

Can it be that we are only on Lifehack Two? There’s just so much free money lying around!

This lifehack involves investing in cashflowing assets – if your aim is to invest your disposable income anyway, start with this type of investment instead of focusing on capital gains – then you can choose how to reinvest or even spend the income.

And those of you who haven’t thought about investing before – get thinking!

Assets that Cash-Flow

Cash-flowing assets include rental property (also known as buy-to-let), Peer to Peer Lending, and dividend paying stocks and funds. Anything that pays out cash regularly, instead of you having to sell it to get the gains.

For most starting out, it will be P2P Lending and high-dividend paying funds that will be within your price range, as buy-to-let property usually needs upfront investment of £30,000+ for the deposit.

It is these types of asset classes that pump out cash to supplement your disposable income.

Help each other to get rich with Peer-to-Peer Lending

Peer-to-Peer Lending

P2P works by you lending your savings to businesses and individuals who want to borrow them, and you get paid a high interest rate. There is usually some form of protection built into the system to defend your investment from defaults, such as a provision fund, or being backed by business property.

If you had savings of £9,000 in a P2P Lending platform in active loans paying 6.5% interest, it would pay you £50 a month in interest. Sweet!

This is an investment, so capital is at risk, but in our view the risk is low compared to shares and many other asset classes when properly diversified across platforms.

Again, this is one way that both of us significantly improve our monthly disposable incomes.

Property

Buy-to-let might be expensive but it’s not to ignored. I get around a third of my income from rental property, hundreds from each. Maybe this is something you can benefit from too.

Life Hack #3: Affiliate Marketing and Advertising

Online

Fans of South Park may have seen an old episode where the guys make 1 million “theoretical” dollars on YouTube when a video they make goes viral. The episode when it was released in 2008 was making the point that back then people couldn’t make money online even when their content is great.

Poor Butters only made "theoretical dollars" for his YouTube efforts back in 2008!

This is happily no longer the case! Affiliate marketing and pay-per-click advertising is the answer to how millions of ordinary people can make extra money online from their channel, website or blog.

If you have a space on the internet that people want to visit, you can supplement your disposable income by letting other companies advertise on there, just like the 3rd party advert you’d probably skip past at the start of the video version of this article!

Or you can put a link on your website to a product that you think your readers may be interested in purchasing from a 3rd party.

The most commonly used affiliate links are from the Amazon Affiliate program, where if people buy a product on Amazon via a link you provided, you get a small share of the sale proceeds.

The key to making a success of affiliate marketing is volume. You usually get a pittance per click, so you need a big audience doing the clicking.

How do you get a big audience? By being genuinely awesome, and providing useful or entertaining value. Let us know how we’re doing on that front in the comments!

Physical

Getting paid for advertising other people’s stuff isn’t limited to cyberspace. Car Quids are a company who will pay you to display company logos and slogans on your car.

If you drive regularly through a city or population centre, or major motorway, your chances of being selected as an advertising partner are improved.

Life Hack #4: Side Hustle

Perhaps taking the previous Hack to the next step, a side hustle is a business that you set up and run in your evenings and weekends outside of the grinding hours of work.

You need to be committed to the money-making cause to invest your free time like this!

A home business could be a website selling products you’ve made, a blog/YouTube channel reaching the masses with an online store similar to what we do, or again could be in the real world selling things locally.

This last one could bring the fastest immediately results, actually selling things or time locally. But the beauty of an internet based business is scalability – your customer base is the planet Earth.

The end goal is to scale a side-hustle to global levels

Life Hack #5: Requalify

Requalify can mean 1 of 2 things:

Official Qualifications

Wage-slaves toiling in the mine of a job they hate will usually seek out a new nationally recognised qualification that will allow them to step up in their career or step sideways into a new one.

You might even seek a new qualification to escape the rat race and start a small business, such as a Receptionist deciding that she’d be happier and make more money as a self-employed fitness instructor. Even that would require her to have specific recognised qualifications.

Unofficial Levelling Up

Do you think anyone cares what qualifications Bill Gates has? Or Jeff Bezos? Of course not!

The internet is littered with spaces that you can level up your skill base for a small fee: Udemy; Khanacademy; Codeacademy; Google Digital Garage; or better yet for free on YouTube. By learning new skills you can make more money.

Bill Gates taught himself programming. He used it to create Windows, which in turn created him 110 billion dollars.

Learning new skills is never a waste of time, and ideas for starting businesses aften come as a result of having a unique skillset that makes you a gap in the market.

What business might you have started if you’d taught yourself Spanish, programming, barista coffee making, carpentry, and engine repair? We have no idea! But we’re betting your skillset would be unique and show you ways into a market niche.

Get that disposable income flowing, starting by scooping up all that free cash lying around that we covered in Life Hack #1 – go back and take notes because it adds up to a tidy sum! And get thinking about levelling up as well as adding extra income streams onto your life.

What’s your disposable income, the amount left over each month that you can invest or save? Let us know in the comments section, along with what you’ll be doing to increase it!

Written by Ben

What to Do When Stocks Crash – Don’t Panic

Stocks and shares are constantly going up and down in value. If you can’t stomach this volatility, then you need to keep away…well away. But if you do this you will regret it. Having your money invested in the stock market is the easiest way to make your money work hard for you, rather than you having to work hard for money.

We wrote this during the beginning of the Coronavirus stock market crash and time will tell if it was a flash in the pan – or conversely – far worse. Either way we are confident that this is just another minor blip on the stock market’s march to ever greater heights and gives you an awesome buying opportunity. Price volatility is your friend if you are brave enough to strike.

Keep Calm and Buy More

We don’t know whether stock markets will be down further in 1 years’ time but in 5 years’ time it’s likely to be higher, in 10 years it’s almost certain to be higher and in 20+ years it’s practically guaranteed – and you will of course have collected some juicy dividends along the way.

And in a way it’s these dividends that reduce the risk of investing. The FTSE 100 hasn’t had the best 20 years, which is why it’s so important to diversify and why we have always encouraged world-wide investing as seen in our ‘How to Own the World’ series. Other indices around the world have fared much better over this time period, which highlights just how important it is to own everything.

Anyway, we’ve done some serious analysis on the FTSE 100, and our findings demonstrate that selling after a crash is the worst thing you can possibly do. Let’s check it out…

Editor’s note: Don’t forget to check out the Offers page where we have hundreds of pounds of cash bonuses that you can snap up when you sign up to any of the investment and P2P Lending platforms listed – including on the Nutmeg robo-investing platform; one of the easiest ways to buy into and take advantage of the low market right now! 

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FTSE 100 Over the Last 20 Years

Below is the FTSE 100 for almost 20 years, which shows a pretty bleak picture. But it at least shows that that after every crash it does eventually climb above its previous high.

And to be honest unless you had bought in at the peak of the market it’s not a problem at all.

And by buying regularly, known as pound or dollar cost averaging, you average out your purchase price meaning your average purchase price is never the top of the market.

FTSE 100 Price History Over 20 Years

By this logic a big price fall such as what we’ve seen in February 2020 due to Coronavirus gives us an incredible buying opportunity. It is this reason why Ben and I are always ready to pour more money into the market, which is exactly what we have been doing recently.

The market had crashed by about 10%, so we buy a little. If the market continues to crash, and we’re very happy if it does, then we will buy big. We consider a 10% fall to be a nice gesture from the market but 20% or more is a time to splash the cash big time. Everything is on sale!

The problem many people face is the emotional hurdle that a stock market crash creates, which is why many successful investors automate their investing. I take advantage of Interactive Investor’s free monthly investing service, so I don’t need to worry about exact timing. But I also buy big when everyone else is panicking.

If we look back at that FTSE 100 graph, we can see that it always recovers when people realise that it’s not the End of the World. We’re just showing you the data we could get our hands on, but we know this story goes back until the beginning of time – or at least the beginning of the FSTE 100.

FTSE 100 Total Return

Over time we know that dividends, particularly when reinvested, are the biggest drivers of investment performance. So worrying over short-term price fluctuations is completely unnecessary.

FTSE 100 Total Return

Above we’re looking at the FTSE 100 vs. FTSE 100 Total Return Index for about 7 years. Total return means that it also factors in the effect of dividends reinvested. From this graph we can’t really see too much. It appears that the Total return index just perfectly tracks the main FTSE 100 line.

However, we want to see relative performance so a technique we can use is to rebase the graph. Each line now starts at the same point, which will show us the real story.

FTSE 100 Total Return - Rebased

We can now see that although the Total return line still mimics the FTSE 100, it quite quickly powers ahead and therefore the impact of small price fluctuations become less important as the end point is leaps and bounds ahead of the starting value and your original investment.

This is a key reason why we can both handle large price declines comfortably because we know that just by being invested in the market it is going to make us lots of money in the long term due to the power of dividends compounding our returns. We wish we had been able to show you a longer time period because the gap compounds even more and would become enormous but unfortunately, we couldn’t get our hands on the data.

Nevertheless, even in this 7-year period the difference is still significant with the FTSE 100 showing a return of just 10% but the FTSE 100 TR index returning around 50%.

Why Selling Immediately After A Crash is Stupid

Neither of the graphs we’ve looked at so far really demonstrates the size of the crashes and speed of recovery.

The next graph shows the week-on-week percentage movements of the FSTE 100. What we can see is that whenever we see a period of sharp decline, this is always followed by a quick reversal soon after.

FTSE 100 Weekly Movements - Comebacks After Crashes

What we can see is large drops around 2001 relating to 9/11 and huge drops around 2008 due to the financial crisis. Then there’s a crash in 2011 due to the debt crisis. The last 20 years is littered with crashes and we’re sure the Coronavirus crash is just another blip on the graph as all that proceeded it have been.

What shocked us the most from this graph is the speed of the reversal in the weeks that followed a crash. The end of September 2001 saw the FSTE rally 10.59% in one week.  In 2008 there was a week where it climbed 12.72% and another week shortly after rallying a further 13.41%.

The graph shows this pattern throughout the 20-year period. We’re betting the same will happen again now and in future.

If you sell immediately after the crash, you will miss out on these incredible price rallies. Shockingly people have very short-term memories and previous impending dooms are long forgotten.

When putting together this graph we had to look up the reasons for the crashes as we couldn’t remember either, but at the time they would have been all front-page news predicting the end of the World!

When Markets Crash, They Always Get Back Up Again

What About Individual Stocks?

We are very confident that overall markets will continue to climb until the end of time. However, we cannot say the same about individual stocks. The financial crisis saw the destruction of the banking sector and on the most part it never recovered.

When an index such as the FSTE 100 falls that’s fine by us but individual stocks fall and often never bounce back. Stocks have their own unique characteristics that can mean they become permanently damaged by whatever caused the price to decline.

For example, travel companies have had a particularly tough time recently. Who knows what a Pandemic could do to the long-term prospects of a travel company? A ban on travel could cause losses to spiral and the company could go bust before any chance of recovery. The difficulties of predicting the outcome is a major reason why we both limit our involvement with investing in individual stocks.

What You Should Do About The Crash

#1 Do Nothing

Assuming you own well-diversified index trackers, do not sell. If you’re the type of person who has an itchy trigger finger, then sometimes the best thing you can do is just not monitor financial news and these events will blow over before you even notice.

See the Opportunity in the Noise

#2 Buy Buy Buy

If you’re a little braver like us, then start buying when everything is on sale. As we’ve just seen in the graphs, very large downwards swings don’t happen very often. Make sure you’re ready to take advantage when they do. It is times like this which give stocks a huge advantage over less liquid asset classes such as property because you can take advantage of lower prices before they rise.

#3 Rebalance

Big swings will often leave your portfolio out of line with your intended allocation. This might be the time to rebalance. What this does is move money from the assets that have performed well, which perhaps have little room to grow, and allocates more to the past underperformers, which may have better opportunities.

How do you react during a stock market crash? Let us know in the comments section.

Written by Andy

Robert Kiyosaki: Legend or Con Artist? Cashflow Quadrant – Rich Dad

Assets, assets, assets. Buy them, hold them, get rich from them. This is the philosophy of Rich Dad Poor Dad author Robert Kiyosaki, distilled to few words, and yet he has a lot of detractors who like to call him a con man who doesn’t understand what an asset is.

A lot of the hate comes from the probably correct perception that his fortune was made from the books that described his fortune, rather than the assets which he writes about.

Take a step back from the man and look at the words in his books however and you are left with a treasure trove of sound advice – an investors’ Bible which both of us have used to plot the course of our lives over the last 5 years, culminating in massive increases to our portfolios as well as the creation of the Money Unshackled business.

It is no small exaggeration when we say that we owe our own successes in part to the teachings of the likely fictional Rich Dad in the books, whose words on the Cashflow Quadrant and the power of Assets we both took to heart.

Robert Kiyosaki – Legend or Con Artist, or both? Let’s check it out…

Editor’s note: People interested in investing in Peer to Peer Lending now have a new way to ease into it with our latest offer – open a new account with just £10 in the RateSetter platform and you will get a £20 cash bonus when you use the link on the Offers page!

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Asset Theory – We Like

The core concept of the Rich Dad series is that Assets are things that create a positive passive cashflow without any further input from you, and that everyone should own a whole bunch of them.

We absolutely love this simplified view of investing, and it inspired each of us to new investing heights. Appraising an investment for its cashflow potential is how we pick investments to this day.

We took this concept and ran with it by buying assets such as rental property, dividend stocks and ETFs, and Peer-To-Peer Lending portfolios.

And now we can each draw good cash incomes from our assets every month. Winning advice from Robert there.

Fiction Sold as Truth? – We Find it a Little Dishonest

The “Rich Dad” story of Robert as a young boy and having 2 father figures who taught him everything he knows about money has widely been ridiculed as fiction, despite the author insisting it happened word for word as he said it did.

But as a parable it holds its own truths – all the advice given by the (likely fictional) Rich Dad is sound advice that we and many other investors live by.

And much of it was out of step with the thinking at the time that investing should be for long term growth rather than income creation.

We still find the majority of the investment media encourage a long-term growth strategy aiming at freedom in old age, rather than the “investing for passive income generation” method that we promote.

In this regard, the story of Rich Dad talks truth to power by going against the grain of common investing theory. But Robert should really stop pretending that the story is literally true.

Is the story true? Does it really matter?

Financial Freedom – Our Reason for Being

MoneyUnshackled.com is an investing site unlike most others because we promote Financial Freedom now, while we’re young, instead of the freedom in old age that most leading gurus including Tony Robbins and countless others around the investing world promote.

The story of Rich Dad Poor Dad is one of building up a portfolio of cash-flowing property assets and start-up businesses that Kiyosaki could then live off of, instead of employment.

By all means build a sweet global portfolio of shares to grow your wealth – we do this too. But alongside that have cash flowing assets like Peer-to-Peer Lending and Rental Property or REITs to pump out regular cash that you can start living off.

Then we say to use your freed-up time to start businesses that can be turned into passive income streams. This is also what Robert Kiyosaki says.

Financial Freedom can be pictured as the movement from the left side to the right side of the Cashflow Quadrant

Courses – An Absolute Con

When I started out buying investment properties, it was to the Rich Dad University that I turned to get an introduction to the world of rental property.

I’d read the books and concluded that Robert Kiyosaki and his team must know their stuff. I paid to attend an online seminar, which cost me £120, and came out the other end more confused than when I went in.

And this course was a precursor for further courses, all of which would have cost a fortune. Many other players in the financial education market charge their loyal fans thousands for courses that are nowhere near worth it, so Kiyosaki is not alone in this regard. But it still strikes us as either a con or certainly not value for money.

We may one day create some paid-for courses, but these would be affordable, complete packages, with the aim to educate rather than to up-sell further courses.

The reason we give our tips away for free on YouTube is because we passionately want to change the country and get individuals to take care of their financial futures – because nobody else will do it for you.

Cashflow Quadrant as a Concept – Life Changing

The Cashflow Quadrant, Kiyosaki’s second book, opened our eyes to the truth, Matrix style. At school we are told there is one place to find income – a job.

The Cashflow Quadrant shows that Employment is just 1 of 4 ways to make money, and the 4 ways are equally weighted as there is no reason why Employment should be any more important or worthy than the other 3:

The E is Employment, where most people end up.
The S is Self-employed or Small Business owners – working full time in a business you own, including Self-employed contractors.
B is Big Business owners, people who own companies that make money without the owner’s continued input, because other people run it for them.
And finally the I is Investors, who buy Assets that pay them a passive income.

The Quadrant is further split down the middle, with those who work a 9-5 on the left, and those who don’t have to work anymore on the right.

This concept is eye opening in so many ways that we can’t stress enough how much we love this book. It’s there on the MoneyUnshackled website in the Top Books section along with a load of others that we consider essential reading – check it out book lovers!

The Downplaying of Small Business Owners – A Bit Misguided

Kiyosaki is very critical of small business owners who work in their businesses day to day – in his words, all that they own is a job.

We see his point, but there is a world of difference between being told what to do every day by a line manager, and owning your own little empire.

Plus, Big Businesses do not appear overnight. They start as small businesses, whose owners have to be very hands on.

We find the Cashflow Quadrant makes more sense as a line than a grid – the most common route to fast Financial Freedom follows a route from Employment, to save money to start a Small Business, to develop through time and effort into a Big Business, that ends in a passive income stream being established.

The Investor quadrant is really more of an overlay, that sits behind or around the other 3. Investing compliments and enhances your wealth and income streams throughout your working life.

The Investor quadrant as an overlay; E > S > B is a route map

Your House is Not an Asset – Yes We Totally Agree With This One

Your house in itself does not produce income, in fact it costs a fortune in mortgage payments, council tax, bills, and regular maintenance.

When your boiler blows up, is your house an asset, or did it just cost you several grand?

Kiyosaki has taken more stick for this idea than any other over the years, in fact it’s what made him famous in the first place. His declaration that people’s precious homes were not assets upset millions of people; and intrigued many more.

People don’t want to be told that the thing they’ve spent years overpaying a mortgage on and adding new kitchens and new bathrooms to is not an asset; but is really a liability costing them a fortune.

Kiyosaki’s main point is that you can’t spend a house – because you’re living in it. Its value might go up, but you can’t retire on the value of your home.

Not unless you sell up and move to a poorer city or country where you can buy a far cheaper house and live on the difference for a bit.

But even that is likely to be unsustainable for retirement. The hard truth that your house is not an asset is one that people need to understand, and then start investing in real assets instead.

Asset? Or a Liability packed full of expenses?

Your House is Not an Asset – oh, yes it is! – wait…

Although we totally agree, we also disagree completely 😉

I am far better off and further on my investing and financial freedom journey for having bought a house.

I had a lodger for nearly 2 years, paying by nearly £500 a month, and I have remortgaged my house twice, withdrawing equity to the sum of £50k to help finance 2 of my rental properties.

We’re not saying you should do this – it of course carries risk. A lodger may be dodgy, or an equity release could be invested in an asset that loses money.

But it goes to show that your home can be of financial use, and not always a total liability!

What have we missed? Is Kiyosaki wrong in any other regards, or is he just at the end of it all, a total legend? Let us know your thoughts in the comments below.

Written by Ben

Check out the recommended reading on the Top Books page for budding investors