The time has come to update everyone on our net worth for the Month of March. Sorry I missed February. We had our fist kid. I was worried how that would affect our Net Worth. As it turns out I should not have worried. We really haven’t done a whole lot different with our finances. We have had to spend some more money. Our car’s starter went out so I replaced that. Having the kid wasn’t cheap either. The good is we haven’t used our credit cards for any purchases for quite sometime. If we did use them we had the money in the bank and mailed off the payment the next day. But here is the skinny on my net worth. $-15,232.07. It’s a lot of fun to see that our debt is shrinking our investments growing and our net worth climbing. We even had a surplus of money this month so we paid off a credit card. Now that we are able to apply that payment to one of our other card, our credit card with the highest interest rate will be completely paid off in 8 months. Of course our goal is that anytime we do have extra money we will apply it to a debt. My wife and I are currently researching cars so that when all our debt is paid off we can buy one. The great thing about that is we could honestly afford any car we want. Currently we are paying $1008 toward debt a month. That means we can have a really fancy car when we are debt free. Of course we won’t but a car that cost anywhere near that much, and the bonus is we’ll have decent down payment ready plus the trade-in value of our car that is already completely paid off. So well have a new car a small monthly payment and be spending less about a third of what we are now a month on debt. Who knows if we have been able to survive with 1000 coming out of my paycheck every month this long we might just keep going and get that car paid off within a year.
Next month my wife and I are setting the goal that we will not eat out at all. I excited to see how much money we will save. It will take some planning so that I have a lunch everyday but it should be worth it. I can’t wait to see the result reflected in my net worth come May.
26 March 2007
07 February 2007
Jan Update
Well here is the update for the month of January. My wife and I now have a net worth of -$24,000 dollars. Not as big as an improvement as last month but our truck did break down and we had to spend $1,500 to get it fixed. So things are still working. I am stressed because I'll need to determine how to save for my daughter’s education.
21 January 2007
Snowballing Effect
Another month as past and my wife and I have figured our net worth to be approx. -$26,000. This is a vast improvement. We have gain $2,000 of net worth in on month. It is even more impressive when you consider that my wife and I make less than 2,700 in a month. That translates to the fact that we have bought food, paid for gas, utilities, and rent, and paid down debt or saved money. It excites me because if proves that our investments and 401k’s are really working for us. Helping us increase our net worth, and making us money that we don’t even have to work for. For clarification, this is not my overall debt. It is much higher. This, the $26,000, is what I would still owe if I were to sell all my assets. This may seem really scary, and in fact it is, but you should keep in mind that more than 60% of all our debt is due to student loans.
I would like to share with you a “secret” that perhaps the lenders use to entice and trap you, and how I’m using this to my benefit to get out of debt and beat them at their own game. I hope you are as frustrated as I am with all the advertisement from any financial business (I’m carefully not to use the term institution, by financial business I mean any entity that exchanges money to make money. i.e. banks loan center, ect.) and all their advertisements about getting some type of loan or another, to pay for or refinance another loan you may have. This is a very good thing and can in fact save you a lot of money. IF IF IF you only borrow what you need to pay of the original loan. That’s the bait they dangle, but when you go in they convince you take out even more money because you getting such a better rate and can “do something fun” with that money. This is what is commonly referred to as snowballing debt. Many of you may be familiar with it. Just like in a cartoon you picture a snowball rolling down a hill getting bigger as it rolls. The illusion these businesses portrait is that you’re getting out of debt, but anytime you add more snow, no matter how minuscule, to the snowball, the snowball is in fact getting bigger.
So why don’t you reverse that tactic on all these entities that want you to forever pay them your hard earned money. First, make a list of all you debts, in fact make two lists. Order one of the lists from highest interest rate to lowest interest rate. Order the other list from least amount due to highest amount due. Before making these lists, you must convince yourself that no matter what the total debt is you’ve been making these payments and surviving. (If you haven’t you need more help than I can give you.) Decide how much extra you can pay per month. Make it at least $50, I guarantee that you can budget and come up with $50 more dollars to pay towards bills. Now you have to decide what is more important to you. Paying off you debt quickly or saving the most amount of money. If it is the first, start by paying off the creditor that you owe the least too. This is very good if you tend to get discourage or need to see results to stay motivated. If you want to save the most amount of money, pay off the Creditor with the highest interest rate. After you have paid off the first creditor roll that payment into the next creditor bill, you’ll be snowballing you way out of debt in no time.
I would like to share with you a “secret” that perhaps the lenders use to entice and trap you, and how I’m using this to my benefit to get out of debt and beat them at their own game. I hope you are as frustrated as I am with all the advertisement from any financial business (I’m carefully not to use the term institution, by financial business I mean any entity that exchanges money to make money. i.e. banks loan center, ect.) and all their advertisements about getting some type of loan or another, to pay for or refinance another loan you may have. This is a very good thing and can in fact save you a lot of money. IF IF IF you only borrow what you need to pay of the original loan. That’s the bait they dangle, but when you go in they convince you take out even more money because you getting such a better rate and can “do something fun” with that money. This is what is commonly referred to as snowballing debt. Many of you may be familiar with it. Just like in a cartoon you picture a snowball rolling down a hill getting bigger as it rolls. The illusion these businesses portrait is that you’re getting out of debt, but anytime you add more snow, no matter how minuscule, to the snowball, the snowball is in fact getting bigger.
So why don’t you reverse that tactic on all these entities that want you to forever pay them your hard earned money. First, make a list of all you debts, in fact make two lists. Order one of the lists from highest interest rate to lowest interest rate. Order the other list from least amount due to highest amount due. Before making these lists, you must convince yourself that no matter what the total debt is you’ve been making these payments and surviving. (If you haven’t you need more help than I can give you.) Decide how much extra you can pay per month. Make it at least $50, I guarantee that you can budget and come up with $50 more dollars to pay towards bills. Now you have to decide what is more important to you. Paying off you debt quickly or saving the most amount of money. If it is the first, start by paying off the creditor that you owe the least too. This is very good if you tend to get discourage or need to see results to stay motivated. If you want to save the most amount of money, pay off the Creditor with the highest interest rate. After you have paid off the first creditor roll that payment into the next creditor bill, you’ll be snowballing you way out of debt in no time.
22 December 2006
I took the plung into Metals
I made my first diversification into precious metal last week when I bought four Silver rounds for almost $56. The person that I talked too seemed very knowledgeable. Of course it may all be perspective because I’m still new to investing in precious metals. What he told me made a lot of sense. I went there with that idea of buying one to several 1/20 oz. Canadian Maple Leaf gold coins. When I found out that that buying 20 of those would cost me $100 more than just buying a 1 oz coin I decided to go with the silver. I found this to be very rewarding. As we all know everyone likes to spend money. Especially on something they enjoy. Buying coins is the best of both worlds. I get to spend my money on something that is valuable that I get to keep but really I’m not losing anything and in the long run I’ll be money ahead because precious metal historically have always beat inflation. After all our money was once based on a gold reserve.
Make sure to check back next week, I’ll be blogging about a good way to reduce you debt and first of next month I’ll be giving a update on my net worth.
Make sure to check back next week, I’ll be blogging about a good way to reduce you debt and first of next month I’ll be giving a update on my net worth.
18 December 2006
First Step: Learning to Invest & Teaching your kids
My fist step in investing was when I bought two shares of delta stock and one share of Lockheed Martin the commission was $15 per trade so the total commission for three shares of stock came to $30. I didn’t have much money so I bought what I thought I could afford. I didn’t realize at the time you could invest in mutual funds for as little as $50 a month. I had no idea what I was doing, and looking back on it, it shows. I’ve learned a lot since, but do not consider my “three share folly” a waste or time or money by any means. It gave me a valuable education and I have even managed to turn a profit. I’ve done some great things with the delta stock, so even though my two shares are now worth six dollars less then when I bought them, I am currently up $1.94. My one share of Lockheed Martin has a profit of $29.61 which means I could sell today, and even with the $15 commission fee I’ll still be money ahead. Not to mention the $.30 dividends I’ve been receiving every quarter from that one share. Who knows, if I save my money and buy bulk shares the profit will increases even faster. Then I can sell for an even higher profit but for right now my money is going towards more lucrative investments. (If actively buying and selling stocks interests you I would strongly suggest opening up a brokerage account with USAA if you are eligible for membership. Their rates are some of the best I’ve found.)
I call the experience mention above First Step A. My true first step to accumulating wealth efficiently actually started with Fist Step B. This was a very simple first step and it came when I admitted to myself that I knew nothing of investing. I didn’t know where to go. I didn’t know anyone that was wealthy, or if I did I wasn’t aware that they were wealth. I was married, a student and having trouble making ends meet (I still am but I have security knowing I have access to an emergency fund) so I decided to look towards the “Dummies” series of books. This was one of the best things I ever did. The book was called Personal finance for Dummies by Eric Tyson. It set me back about $20. $20 I probably had to put on a credit card. Setting the interest of the credit card aside and looking at this book as an investment it has made me over $3,000. That equates to almost a %1500 return in two years. Being realistic that return needs to be split between two other books, George S. Clawson The Richest Man in Babylon (on CD), and Richard Paul Evans The five Lessons a Millionaire taught me.
Having the chance to do it all over again I would skip First Step A and change a few things about First Step B. If you are just getting started with investing here is what I would recommend; Buy all three books, make sure to by them used, except maybe Dummies as it would be worth the money to have the current edition, and I would get Clawson’s book and CD. I would begin by reading Evan’s book first. It’s a fast read and can really get you motivated. Concurrently I’d be listening to Clawson book during any commuting I might have, and then finish up with the Dummies. I would caveat this plan by suggesting that you start saving when you are motivate according to the ideas present by Clawson and Evans but wouldn’t begin investing until you’ve finished the Dummies book.
This last bit of advice if for all the parents that might be reading this, PAY YOU CHILDREN IN GOLD or Silver (probley start with the silver as gold is very expensive)!!!!!!! You might wonder about this, and while I don’t have kids, my wife can attest that I still act like one. Think about it for a second, when you were around the age of 5 if you had received a silver coin, what are the chances you still have that silver coin today? If you still had that coin you would likely have earned higher than a 5% return times the number or years past. Again imagine that you are five but instead of a silver coin you had received a $20 bill (roughly the price of some silver coins). Now what are the chances you’d still have the $20? If by some miracle you did, remember what inflation has done for you, and what buying power that 20 now has. I believe that one of the worst disservices of our time is that we teach our children to get rid of money. That money is evil; we should stay away from it. How many times will your children hear the phrase that money is evil before they are 16 (the age at which most people begin to work and earn a “meaningful” income)? As toddlers and adolescents how many time will they curiously explore money with there five sense and be told, “don’t do that you don’t know where it’s been.” “That’s dirty you might get sick.” “Give that to me it’s full of germs.” Don’t get me wrong I’m not saying that we should make children pack coins in their mouths, but there exist alternatives. Silver and gold coins provide one alternative.
I can already hear people screaming and see the email flooding my inbox “WHAT!!!!! GOLD???? Mutual funds have a much better return!!!” “I’m going to get my kid a savings bond. That way he’ll be forced to save it.” Both of these arguments are true, but who cares. Being the great parents that you are you’ve already got a mutual fund set up for your child’s college expensive (of course you don’t have it in their name, one of YOUR mutual funds is dedicated for such a purpose, if you want to know why you’ll have to email me) and as far as the Savings bonds go, I recommend that grandma and grandpa do that. How much learning really goes on when you are forced to do something? The important thing here is that the youth learns something. First and most importantly they will learn how to save. Period. Any save by choice. Second they will learn that money is tangible. (Granted the tangibility of money is open for debate but I’ll save that for a later blog.) What child wouldn’t love to have their very own gold and silver treasure? The fact that gold and silver must be exchanged before it can be used will give the child incentive to hang on to it. They still have the choice of spending but are less likely because they will have something they understand is even more valuable than candy or toys. You can even make it game to help your children cumulate more by exchanged their silver coins for gold coins.
The fact that elementary schools don’t teach an understanding of money to children is a great disservice; however I blame parents for the situation of our society. I accept that the society we live in is great, however I believe it could be much much better if everyone had a basic understanding for money.
If you have any question please feel free to email me at xn2flyfishing@gmail.com. Currently I am researching investments in Gold and Silver and will keep you posted on such. Soon I will Bloging on a plan for getting out of debt
I call the experience mention above First Step A. My true first step to accumulating wealth efficiently actually started with Fist Step B. This was a very simple first step and it came when I admitted to myself that I knew nothing of investing. I didn’t know where to go. I didn’t know anyone that was wealthy, or if I did I wasn’t aware that they were wealth. I was married, a student and having trouble making ends meet (I still am but I have security knowing I have access to an emergency fund) so I decided to look towards the “Dummies” series of books. This was one of the best things I ever did. The book was called Personal finance for Dummies by Eric Tyson. It set me back about $20. $20 I probably had to put on a credit card. Setting the interest of the credit card aside and looking at this book as an investment it has made me over $3,000. That equates to almost a %1500 return in two years. Being realistic that return needs to be split between two other books, George S. Clawson The Richest Man in Babylon (on CD), and Richard Paul Evans The five Lessons a Millionaire taught me.
Having the chance to do it all over again I would skip First Step A and change a few things about First Step B. If you are just getting started with investing here is what I would recommend; Buy all three books, make sure to by them used, except maybe Dummies as it would be worth the money to have the current edition, and I would get Clawson’s book and CD. I would begin by reading Evan’s book first. It’s a fast read and can really get you motivated. Concurrently I’d be listening to Clawson book during any commuting I might have, and then finish up with the Dummies. I would caveat this plan by suggesting that you start saving when you are motivate according to the ideas present by Clawson and Evans but wouldn’t begin investing until you’ve finished the Dummies book.
This last bit of advice if for all the parents that might be reading this, PAY YOU CHILDREN IN GOLD or Silver (probley start with the silver as gold is very expensive)!!!!!!! You might wonder about this, and while I don’t have kids, my wife can attest that I still act like one. Think about it for a second, when you were around the age of 5 if you had received a silver coin, what are the chances you still have that silver coin today? If you still had that coin you would likely have earned higher than a 5% return times the number or years past. Again imagine that you are five but instead of a silver coin you had received a $20 bill (roughly the price of some silver coins). Now what are the chances you’d still have the $20? If by some miracle you did, remember what inflation has done for you, and what buying power that 20 now has. I believe that one of the worst disservices of our time is that we teach our children to get rid of money. That money is evil; we should stay away from it. How many times will your children hear the phrase that money is evil before they are 16 (the age at which most people begin to work and earn a “meaningful” income)? As toddlers and adolescents how many time will they curiously explore money with there five sense and be told, “don’t do that you don’t know where it’s been.” “That’s dirty you might get sick.” “Give that to me it’s full of germs.” Don’t get me wrong I’m not saying that we should make children pack coins in their mouths, but there exist alternatives. Silver and gold coins provide one alternative.
I can already hear people screaming and see the email flooding my inbox “WHAT!!!!! GOLD???? Mutual funds have a much better return!!!” “I’m going to get my kid a savings bond. That way he’ll be forced to save it.” Both of these arguments are true, but who cares. Being the great parents that you are you’ve already got a mutual fund set up for your child’s college expensive (of course you don’t have it in their name, one of YOUR mutual funds is dedicated for such a purpose, if you want to know why you’ll have to email me) and as far as the Savings bonds go, I recommend that grandma and grandpa do that. How much learning really goes on when you are forced to do something? The important thing here is that the youth learns something. First and most importantly they will learn how to save. Period. Any save by choice. Second they will learn that money is tangible. (Granted the tangibility of money is open for debate but I’ll save that for a later blog.) What child wouldn’t love to have their very own gold and silver treasure? The fact that gold and silver must be exchanged before it can be used will give the child incentive to hang on to it. They still have the choice of spending but are less likely because they will have something they understand is even more valuable than candy or toys. You can even make it game to help your children cumulate more by exchanged their silver coins for gold coins.
The fact that elementary schools don’t teach an understanding of money to children is a great disservice; however I blame parents for the situation of our society. I accept that the society we live in is great, however I believe it could be much much better if everyone had a basic understanding for money.
If you have any question please feel free to email me at xn2flyfishing@gmail.com. Currently I am researching investments in Gold and Silver and will keep you posted on such. Soon I will Bloging on a plan for getting out of debt
14 December 2006
Introduction
I've decided that I want to be rich. Actually I didn’t just decide that, nor was it a decision I made over night. It was a process. The decision was a formality in the process, but a very necessary formality. Investing has become a hobby of mine. Just as I love to fly fish and fly, investing and building wealth is right up there. Just like fly fishing and flying it is a life style.
Soon after investing I realized that many of my peers are in a much worse situation than I am. Being only 26 years old and wishing I’d stated my investing ventures long ago, I wish I could reach my peers and show them the wealth they begin to mass.. This blog is meant to do so, and help anyone else that wish to learn more about investing.
Unlike Robert Kiosoke, I haven’t hat the privilege of someone teaching me what to do with my money. So I will write about some of the mistakes I’ve made, what has worked and what hasn’t work as well. I would like to make clear that I DO NOT regret anything that I have done with my money as far as investing goes. Even before I knew what to do, doing something is always better than doing nothing.
I am in not claming to be rich, at month ago my net worth was $-30,000, remember I’m a student and have many student loans. I during this process I will be tracking my net worth. Again I would stress that this is my path to wealth, and I invite all of you to join me one it.
Soon after investing I realized that many of my peers are in a much worse situation than I am. Being only 26 years old and wishing I’d stated my investing ventures long ago, I wish I could reach my peers and show them the wealth they begin to mass.. This blog is meant to do so, and help anyone else that wish to learn more about investing.
Unlike Robert Kiosoke, I haven’t hat the privilege of someone teaching me what to do with my money. So I will write about some of the mistakes I’ve made, what has worked and what hasn’t work as well. I would like to make clear that I DO NOT regret anything that I have done with my money as far as investing goes. Even before I knew what to do, doing something is always better than doing nothing.
I am in not claming to be rich, at month ago my net worth was $-30,000, remember I’m a student and have many student loans. I during this process I will be tracking my net worth. Again I would stress that this is my path to wealth, and I invite all of you to join me one it.
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