Whether it’s the latest Stranger Things season that’s your guilty pleasure or you get your fix from Netflix’s newest crime show, The Alienist, the streamlining giant has a show or movie for everyone. With a catalogue as vast and diverse as Netflix’s, it’s all too easy to get pulled in by an original series and lose a whole weekend to binge-watching. Emerging only on Monday, your deep-dive into TV gives you excellent fodder for conversations around the water cooler. Though it may help you survive breakroom chatter with a boring co-worker, don’t confuse Netflix for anything that it isn’t. While it’s a great resource for entertainment, it’s a terrible resource for finances.
Last year, Netflix reported it planned to finish the next three years with a negative cash flow. Its 2018’s budget has been bumped up to $2 billion. The streaming giant justifies the future red in its ledger by saying the move will bankroll more original content. Great news for us Netflix junkies but momentary bad news for its accountants.Its founders promise it will pay off, as new content will increase subscribers and cement its title as the reigning streaming service.
Netflix isn’t alone in igniting a substantial burn rate. It’s joined by Hulu and Amazon Prime Video, both of which are swallowing net losses to increase its subscriber count. Though risky, this move may prove to pay off for all three companies, as streaming video continues to grow in potential each year.
Comparatively, running a deficit in your personal finances just doesn’t offer the same potential advantages in the long run. Eventually, overspending will catch up to you, and you’ll face poor credit and bankruptcy as consequences to your fast and loose fiscal ways.
Unlike major corporations with billion-dollar investors, you don’t have stakeholders willing to lend you millions of dollars. Without that kind of backing, you need to spend within your means. If you aren’t sure what that is, a budget can help you determine how much cash you need to make meet your basic living needs. This financial tool can do much more than that. In outlining every purchase you make and comparing it to your paychecks, you can see if you’re spending more than you’re making. By making an exacting list of your purchases, you can identify specific categories of spending that are pushing you beyond your means.
Beyond damage control, a budget can help you prepare for your future. When you eliminate unnecessary spending, you can use that money for savings. A nest egg, an emergency fund, a vacation plan, and a retirement plan are features of healthy finances.
Depending on the financial experts, how much you put aside in an emergency fund differs. Some believe three to six months will cover you should you lose your job or incur expensive, unexpected expenses. Others believe this range is outdated and doesn’t reflect the current job market. Suze Orman, previously of CNBC and the O Network, says you should have as much as 12 months income sitting in savings because it may take you a full year to find a job.
A full year’s worth of income will take a long time to generate. Even three months can be a challenge if you have relatively little expendable income to work with. This may leave you feeling stressed, knowing you won’t have the funds to cover any unexpected bill or repair.
Luckily, a direct lender like MoneyKey offers a simple and convenient way to boost your emergency fund during these financially difficult times. As an online direct lender, they offer installment loans that are an alternative to the typical borrowing experience. You don’t need to find time to visit a bank or financial advisor. You can secure quick payday loans online. You’ll seethe application process doesn’t have nearly the same red tape that can slow down or complicate traditional loans, making them a faster and more convenient stopgap.
Eventually, with a balanced budget you won’t have to rely on assistance, as you’ll be able to establish an emergency of your own making. Until then, check in with other fintech startups to see how they can offer alternative assistance and financial services to conventional banks. They may just offer an innovative and progressive solution to your budgeting needs.
Innovation through frontline fintech companies is much safer than the risks a multi-billion-dollar conglomerate like Netflix can take on. While it can survive three years of negative cash flow, you can’t. Leave Netflix and other streaming giants to what they’re good for: wasting time with a beloved television character. As for your financial advice, check in with dedicated financial companies you can trust.