All About Money All the Time!

money and finance adviceWelcome to our financial blog. We are a financial blog like many other financial blogs.

But there is a difference. We aren’t stuck in boredom land with a stick up our assess too lame to enjoy life.

That may be a little harsh for you. Holy hell I hope not. But that’s the core of what we are. This blog will incorporate a realistic look at money and finance with a realistic perspective. Not salesy. Not pushy. Not pretentious.

When you read this blog you will know that you are reading the real ideas of real people. Not sugar coated. We want you to feel like we are just like you–just regular people who want to save properly and learn better ways to be financially responsible.

But personally, I’m just not your run of the mill guy. I’m not going to lie I like a lot of things. I’m into music, skydiving, painting, writing, motorcycle riding, and a lot of other things. These are a part of me. What would a blog be without the truth? Well, it would probably be most blogs out there.

See most people out there, in my opinion, are trying to be something they aren’t. This makes them easy to see through. And honestly, it makes them a little boring.

Sure, anyone can go Google the newest contribution limits on the 401k and write a post on it, in fact you will probably see it on every lame blog out there.

And every one of those people will have a special Christmas post, Easter post, and holy hell any other lame ass idea possible.

Boring, trite, predictable.

I promise this–not on this blog. I’ll do Easter posts for Halloween if I want to. I am not going to operate this based on someone else’s unspoken pattern and design.

The only rule I’m following is a simple ‘words per post’ rule so that big G will give me some love. Other than that, if it’s a rule, I want to break it.

And if you want to email me or give me advice in the comments… do it. If there is a rule I’m following, tell me so I can break it.

I know it’s not really living on the edge to be a rule breaker in the blog world, but I am just going to be myself. That you can be sure of. These posts will be (mostly) financially based, but hey, that’s the point of a money blog right?

In the end I might do a podcast, or some videos, but we’ll see. If you have question about something email me, if you want to chat call me, I’m always ready and willing to chat with fellow internet lovers such as you.

So sit forward, don’t relax at all, and try not to enjoy anything that will come from this blog…then, 100 years from now, when my predictions are all correct, someone will find my blog and it will become famous. I will be the Vincent Van Gogh of the blog world.

Kudos to me.

Boom! Let it begin with 21 guns.

Spring Clean Your Retirement Plan

Spring Clean Your Retirement(Some ideas for eliminating financial-resource-sapping clutter)

Spring! In warmer regions of the world, spring doesn’t have near the impact as it does for those living in colder climes. Spring for those shaking off winter means packing away boots, shovels, plows; sweeping out a few months’ worth of dustballs; and opening the windows to let some fresh air in! Spring is liberating.
If you’re like me, spring is also time to evaluate one’s financial position. Partly because income-tax deadlines are looming; it’s impossible to put off the inevitable annual chore of gathering up receipts, payroll slips, bills – whether you hire someone to file your income tax or do it yourself.

If you are on the eve of retirement, or already there, spring is a great time to take an objective look at your financial situation. After all, retirement (unless you plan to generate a limited income through part-time or self-employment) will mean being dependent on three sources of income: Social Security (or Social Insurance if you live in Canada), pensions, investment income. Depending on your lifestyle, this income may or may not cover your retirement expenses. After all, depending on your retirement age, you could potentially be looking at 30-40 more years. That’s a long time!

Take a good hard look at your statements. Look for items you don’t normally pay attention to, especially service charges and fees. And interest rates if you still owe money. One of the most-cherished rules of retirement is not to retire when you still carry debt. Looks good on paper, doesn’t it? The reality for many boomers is that they are retirement age but still owe money, whether in the form of mortgage or credit-card debt. It becomes especially important in retirement to slash any unnecessary expenses.

One way to do this is to consolidate debt into the most favorable accounts. Not every credit card, for example, is created equal. Interest rates vary from 6% to 22% (more if your credit history has not been exactly stellar). Some charge annual fees, some don’t. Too many charge a killing over-limit fee if the account goes even $1.00 over the limit (often pushed over by their monthly interest charge), others are more lenient. Examine bank statements. If you have a few different accounts in different banks (perhaps some business-based), look at transferring your funds into one.

Savings accounts are generally less costly in terms of monthly service charges and will even provide a small (very small at current rates) interest income. If you do not plan to withdraw frequently from the account, this may provide a savings in terms of fees. Investments, too, may be consolidated in order to eliminate brokerage administration fees (which can quickly chew up the value of low-yielding accounts).

Take an objective look at what’s coming into your home. Unless you’re living off the grid with solar and wind power, you will need electricity. But the World Wide Web has created all sorts of alternatives for everything else that simply didn’t exist when boomers were young. Phone service no longer has to be through a landline connection. TV service can be set up via the Internet through services such as Netflix. Even magazine and newspaper subscriptions no longer need to be received in paper form; they can be accessed over the Internet. A good high-speed Internet connection offers the opportunity to bundle at a significant cost-saving.

Consider selling your house and moving to a smaller one. Many retirement-age people do just that. They may have lived in the same house since their children were young and bought it with children in mind. Now they no longer need the six empty bedrooms. A two-bedroom house would suit them just fine and be more economical to maintain. Moving is also one of the most effective motivators in de-cluttering a house. As you’ve grown older, have you realized just how few material possessions you need to be happy? Host a big moving sale.
Rather than pack those two dozen teacups that have sat in your kitchen cupboard gathering dust since your grandmother passed away 30 years ago, put them up for sale.

Whoever buys them will actually want them and make use of them. Leaving them for your kids may just add to their burden when they settle your estate. If you haven’t even looked at a particular item in several months that probably means you can happily live without it. You might as well receive a little money for it now and spend the money on something you do enjoy (or tuck it away in that savings account for a rainy day).

Retirement can be a wonderful time to explore new opportunities to realize your long-cherished dreams. But with a reduction in income, it is particularly important to examine and reduce the clutter in all areas of your life that may drain limited financial resources unnecessarily. Spring is the perfect time to start!

Life Insurance? As an Investment?

Life Insurance InvestmentLately I’ve been doing a little bit of light reading…and for me that means being intensely involved in a topic that I never knew anything about. This time around, it’s life insurance as an investment vehicle.

I haven’t heard of this before a few weeks ago. I’ve always heard people talking about whole life insurance vs. term insurance or something along those lines, but this time seemed different. It wasn’t really about the insurance, it was more based along the lines of investments.

I’ve read most of the Dave Ramsey stuff and honestly I never really believed that crap. I’ve always been more of a simple minded type, do what works in the long run and don’t try to solve problems with quick solutions–they don’t work.

When I was reading about this life insurance as an investment it really made me think I might be missing out on something. I was on http://www.HighCashInsurance.com, which is where I’m getting my information. If this is what they say it is, it may be something I need to get more into.

I guess I’m opening this up for questions and responses. Anyone that has experience in this. Is this real? What’s the catch?

I’m always leery about something new, especially if I haven’t heard of it before. It may take some time for me to digest all of this but so far I guess I would say it seems pretty legit.

A few of the points I found interesting.

1. Keeping money tax free forever. I honestly hate paying taxes. There is something so morally wrong about the situation that has been imposed on us. I am all for keeping up roads and police and those necessities but other than that I shouldn’t be forced into covering costs I don’t believe in.

On top of that taxes always kill my investments. Having an investment that I can keep out of Uncle Sam’s hands forever seems mighty nice for a guy like me.

2. The insurance – I pay a lot of money in term insurance costs, that’s just the nature of insurance. People who talk about this cash value life insurance always seem to say it’s not about the insurance. But, there isn’t anything wrong with the insurance itself. If it can give me an extra 100 dollars a month on top of my investment returns, meaning saving me the cost of my insurance, and that insurance will last for my entire life? That’s money I’m getting back, sure it will go to my family, but that’s better than to the insurance company which is where my term will go.

3. The investment – I have always been on the side that people earn much less in their accounts than the numbers and the indexes say they do. Most people would do well to earn 5-67% consistently in their retirement accounts. On top of that, most people are in 100% risk investments and they don’t really understand what that means. Having a 0% risk investment that earns 5-7% tax annually seems pretty smart to me.

4. Taking control – I am all for taking complete control of my investments. Having access to my money has always been my number 1 priority. I want to be a huge investor in the future, I want to own real estate and big investments that produce income. I’ve always known that. I’ve always known a 401k or IRA is NOT the way for me to go because of my goals. However, many people I talk to say the same thing, but they put their savings into their 401k.

Duh? You won’t get anywhere like that. Don’t they realize if they put money into their 401k then they are toast. They won’t be able to access that money when they need to invest it somewhere else. That money is locked up tight. Time to wake up and smell the sunshine, right?

I want access to my money. That’s another place this life insurance investment has really got me hooked, having complete access to my money–that’s really important. I have always invested in areas where I know I can get access to my money when I want to. Just another point that caught my attention about this life insurance.

So, I’m still researching and looking into things. However, this seems like a pretty solid idea in my book. I’m going to keep looking into it for probably another 6 months. I need to be sure. Any feedback from the readers is obviously welcome. Is this cash value insurance something I should be getting into?

Giving to Charity

charityCharity is a topic of conversation that can get a bit personal. It’s not really easy to say what’s right and wrong here but I think it’s something to be aware of and reminded of. The fact is giving to charity is a good idea, but obviously not something you have to do. I’m just going to share a little of what I have learned and what experiences I have had with giving to charity.

Giving to charity, in my mind, is giving to anything or anyone who needs help. Whether you take it into your own hands to find someone or even some homeless person to give your money or time to it really doesn’t matter. I don’t think charity should be a big thing that we announce to the world. Charity is something you do in your heart and it needs to stay that way Hollywood. (Did I say that out loud?)

Giving to charity does have some financial benefit as well and I’m not just talking about tax deductions.

Giving to charity is a personal issue, that’s just where I wanted to start with this. I don’t have a charity in mind and I’m not trying to convince anyone to give to charity, I don’t care what you do (lol).

What Charity to Give To

Here are some charities you should be giving to. Just a joke. Like I said before, this is your own decision. Find something you believe in or someone you care about. If you don’t believe or care about anything then donate to your church, if you don’t have a church then I’m sure there are online charities that accept paypal. This shouldn’t have to be a chore although I can see how it could be for some people.

The point is, we get caught up in our lives. I’ve always liked how Tony Robbins talks about getting caught up. It’s true. We forget about the world around us and we focus so much on ourselves.

How Charity Helps

That’s the first and most important part about giving to charity–it makes you see the world around you. We get so into our own lives we forget that there are people out there struggling who need our help. This is where charity can be a great help. It gets you out of your own mind and helps you see what is going on around you.

Charity also brings joy. It helped Ebenezer and it can help you too. There is a certain feeling when you give that you just can’t get anywhere else. Sometimes money can be hard to give, however, it’s actually the easiest and laziest thing we can give. Try giving 10% of your time to a charity or cause; some people may do this, however that is a much harder charity road. Giving money is a simple pen and ink participation.

There are also stats that suggest charity helps you in your overall life. Scientific studies have proven that people who give have better and more fulfilling lives. That’s pretty interesting to say the least. Giving to charity not only helps others, it really does help you as well.

How Much?

If you think of charity as a tithe then most people give 10%. I believe 5-10% is a good amount. 10% is what I give, in case it matters.

I personally think charity can be very helpful. I am a dick. I’m a dick on the outside, I’m a selfish prick on the inside. I am stubborn and rude and crass. However, that being said, I have a soft heart. I care about people. Whenever I see a homeless person I want to give them money. I have chosen not to believe the bullshit, and you should too.

People will tell you that giving money doesn’t help. I think rich business owners have convinced themselves that giving money makes people more reliant and selfish. I do believe this in some cases. However, there are many people who actually need help, and I would give to 9 horrible people if it meant that 1 person who actually needed help was getting it.

So do some research, find something you can believe in, and at least try giving to charity and see how it feels. It’s already been proven to work and help so I don’t really have to say anything else. Try charity on for size and see how it fits. Apparently it is a one size fits all.

Is Diversification a Joke?

diversificationI am constantly hearing about diversification and asset allocation. Most every TV show, newspaper article, or magazine dealing with financial planning will mention this. The truth is that there is a lot of organized chaos in the financial world and financial planners and planning firms have done a good job keeping your money in their pockets while losing your money.

The truth is that diversification is rarely done correctly. It has mostly just been a hot button for many salesman to use in order to make you feel secure on a sinking ship.

For instance, many people in 2008 were diversified, but they lost hundreds of thousands of dollars in their 401ks. The reason? They were diversified in the stock market.

First of all, this isn’t diversification. If the market drops and all your money is in the market then most all of your money will drop with it. That’s the natural cause of putting all your money into the stock market. This is usually how most advisors will sell you diversification.

How do I know? Because I’ve been there. I’ve seen it happen. People feel more comfortable when they think they are diversified.

But this is not true diversification.

Let me tell you a quick story about a financial advisor who diversified himself with his clients.

I remember hearing this from him. We’ll call him Jim.

Jim had 100 clients. He knew he couldn’t keep all of them so, what did he do? He made a plan. He chose 4 stocks that he thought would do well. He put 25 clients in each stock.

2 of those 4 went down, and 2 went up. So he had 50 happy clients and 50 mad clients.

Then, he did the same thing again.

And then he did the same thing again.

He knew in the end he would have about 20-30 clients who loved him. That was what he hoped for.

And that’s diversification.

See, most of these advisors and financial planners are about as smart as you, maybe a little bit smarter because they took a government test on a bunch of things that don’t matter to financial planning. But they don’t really have any edge over you on finding good stocks. Stocks are inherently risky and unpredictable.

So what can you do to be truly diversified?

If You Must Take Risk

I am a huge proponent of “don’t take risk unless you have to, absolutely have to, take risk.” I’ve seen how most of the wealthy treat their money and that is exactly how they think.

However, if you want to be in the markets constantly then diversify. I’m not saying diversification is bad, but you have to diversify right.

Which of these 3 options is true diversification?

1. Buy stocks and mutual funds

2. Buy stocks and stock options and gold

3. Buy stocks and real estate and whole life insurance

???

Obviously number 3 is the right answer.

True diversification is putting money in different, completely different, investment areas. Mutual funds are the exact same thing as stocks–they are made up of stocks. So putting your money in many stocks and then putting money in a mutual fund–which is just a bunch of stocks–is not really diversification.

Diversify right if you are going to diversify.

The Rich Don’t Diversify Like You Think

Many people think that you need to put little bits of money into a lot of things. This is not how the wealthy do things. If you look at people like Steve Jobs, Warren Buffett, etc. you’ll see they have one thing in common–they find something they believe in and they go at it full speed.

Warren Buffett finds a company that he wants to own and he buys the controlling share of that company.

Steve Jobs put all his time and money into his own company.

Many of the wealthy believe in themselves and that is what earns them their wealth, not a stock broker.

Diversify correctly but find things that you really believe will do well. Having your own education and making your own moves will give you the education and knowledge that you need to hit home runs. Diversifying and not understanding anything may make you a little bit safer but it certainly won’t make you rich. It takes careful, calculated decisions to get you to where you want to be as an investor.

Don’t buy into diversification. It’s a joke and a salespitch. The best thing you can do is learn for yourself and find investments that will make you money, that’s how you will win in this investment world, not by giving your money to someone else to get rich off of.

The Shark: Act Like One, Think Like One

the sharkShark Tank. If you haven’t seen it then you need to. But I will assume you have because it’s really amazing. These guys are true sharks.

But what is a shark? What makes a shark?

When I was growing up I used to love to play street hockey. I would get so pumped up and imagine myself as a pro hockey player. I imagined I knew all the right moves and I could see myself scoring a goal. And you know what? It worked! It made me actually a descent hockey player.

On the other hand, I remember hearing about Tony Robbins working with a pro basketball player who had lost his game. You know what he did to get the player back in it? He took him to the court and had him do shooting drills, without a basketball.

What do these two things have in common? They show us that there is real power in believing that we can do something. The visualization and imagination play a huge part in success and failure.

It’s amazing how much we dream as kids. But, where does that go? It seems to fade as we get older. But that act of visualization, or call it meditation or whatever you want, works…and it works well.

That’s rule number one of the sharks: Believe in Yourself.

If you can’t believe that you can do something you will never do it. If you don’t want something bad enough, you will never do it. A shark, where is he on the food chain? He’s at the top. He doesn’t worry himself with all the other worries of all the other fish. He just wants to kill and eat. And, he does it.

He knows he can do it. And, really, he has to do it in order to survive.

If you want to be a shark, you have to start acting like one.

In business and money, what does this mean? It means putting in the time and the effort. On top of this, it means convincing yourself you can and you know how to do something. It’s the only way.

A Shark Has To Eat

Now, on top of this, what if a shark misses the fish he is going after. Well, a dead shark will go and sulk in the corner. Don’t be a dumb, dead shark.

Luckily for actual sharks, they don’t run based on logic and emotion. They run based on instinct. If they miss, they try again, if they fail, they try again…or they will die.

Can’t we learn from this? Yes we can. How many times do you make a decision based on logic that turns out horribly? Our logic will fail us. Our emotions will fail us. These things rarely work. Our instincts, that gut feeling when you know you should get up and try again, that’s what we need to have inside us. The hunger. Insatiable hunger.

This really is the only way to being successful. The best training you can have is failure. The question is: how long until you let yourself fail.

Let me tell you a little about myself.

I wanted so badly to be a salesman when I was younger. But, I was afraid. So, what did I do? I tried a few 1-2 hour a day sales jobs and, after a few months, I would quit.

Why? Because I wasn’t making any money.

And why wasn’t I making any money? Because I wasn’t getting any sales.

And why wasn’t I getting any sales? Because I had no confidence.

And why didn’t I have any confidence? Because I wasn’t getting any sales.

It’s a vicious cycle. But, if you want to be a shark you can’t live on land most of the time and then swim whenever you feel like it. You have to be always swimming, always hunting.

That’s the only way it works being a shark.

I failed to sell well because you can’t have a shark mentality only a few hours a day.

So, a few years later, what did I do? I got a ‘more than full time door to door sales job.’ And, I got good. I had the shark mentality.

I wanted it. And I made a lot of money.

That’s the key. If you want to make money you have to want to make money. If you want to be an investor, you have to live the mentality of an investor. Always be investing.

The shark is the man. He ‘s owns the waters. He has control and he knows where he stands.

So be the little boy who jumps into the ocean and acts like he’s a shark. Eventually, you will evolve, and you’ll find that you don’t feel comfortable on land…you will be comfortable being the shark.

Here’s my favorite quote from Kevin O’Leary on Shark Tank is at 41 seconds in, to take us out…

For Those About to Budget

budgeting rock and rollIt has always blown my mind how awful I can be at budgeting. A lot of times, budgeting just sucks…hard.

Funny part about it is that I love budgeting. What I mean is, I love to sit down with a calculator and an Excel spreadsheet and look at this and that scenario with this and that added in subtract this. I freaking love it to death. I am a planner at heart so it gets me motivated to sit around and plan something out.

But what I have found is the spreadsheet mentality doesn’t follow me to the town shopping center. And, I would assume, because I haven’t done any scientific studies to prove my next theory, that most people’s budget fails at the store and not at home.

I mean back in the day it seemed different. I had my little checkbook with the little back page that had all the little spreadsheet numbers so I could see what I had and didn’t have. And hell, if I wrote a bad check I was screwed, so there was no way that was going to happen.

But the mentality changed. It went from the thought process of, “what do I have,” to, “I don’t know if I have.”

What do I mean? I mean credit cards.

See, with credit cards I don’t have to have. I don’t even care if I have a lot of times. I know it’s going to go through because it’s been created to spend money I don’t have.

So, life has changed.

The at home budgeting is always a necessary thing to do. However, it’s the ‘when I’m out and about at the store’ budgeting that really makes the difference.

So, that’s why I say, “for those about to budget, we salute you.”

I’m not talking about sitting down at home with the spreadsheet.

“For those about to budget, we salute you.”

What am I talking about?

“For those about to budget, we salute you.”

That’s right (talking much faster and much more enthusiastic now)! I’m talking about when you are sitting in line with your cart full of items.

That’s when you sing the song. That’s when you get pumped up for budgeting. That’s when the heat starts picking up and your hands start sweating. Why?

“For those about to budget, we salute you.”

Because now you are making that decision. Now is when you decide to put that item back that you really don’t need that costs 100 dollars. That’s where your budgeting mindset kicks in.

And it unites the two great feelings together into one.

The Two Great Feelings – Feeling Number One

What then are the two great feelings?

Well for me, when I pick something out, man (or woman) I feel like a hundred bucks. I love it. I get giddy. I get excited. I just feel good.

But I always feel just a little nervous. And that little guy in the back of my head starts talking.

To be honest, if I really want to make a purchase that I really don’t need, I have to shut that little guy up and just move on…or he’ll just keep talking.

Now, the little guy in my head is always met with Aaron Eckhart from, “Thank You for Smoking.” He’s a genius and he always knows what to say. He convinces the guy in my head to shut up, or this or that. But usually, I end up believing Aaron Eckhart…but it doesn’t sit very well because I’m pretty sure I was just manipulated.

Then I get going and I shop some more, etc. (well not usually, I probably get sick of shopping, personally, after I find one item).

Eventually, I end up in line.

Now, this is where I have installed my trigger song. Every time I get in line at the store, I see that cashier, I see all the lame magazines with news about Juan Pablo, I have triggered my brain to start up the cannons…

And it starts to play.

“For those about to budget, we salute you.”

“For those about to budget, we salute you.”

“For those about to budget, we salute you.”

I know. It’s freaking lame, right? But hey, it’s kinda fun and it works. What it does is it allows the little guy in my head to get some air time again.

“Do you really need this?”

“Does this fit into your budget plan?”

And that’s when my second feeling comes into play.

The Second Feeling

The second feeling I get is the joy of not making that dumbass purchase.

When I put the item in front of Juan Pablo’s, or whoever is on the cover of E News Magazine, face and walk out the store, I get a rush of adrenaline. I did it. I beat Aaron Eckhart. I won the budgeting battle over my brain.

And it most always lasts.

There are only a few times I’ve gone back and bought the item. Usually, that means I can use it or I need it.

Here is a list of some of the items I wanted in the past that I didn’t ever end up purchasing.

#1 – Palm Pilot – 2002 – Ya that would have been useful for 1 year and had no resale value.

#2 – Snowboard Boots – 2004 – Broke my foot 1 month later, haven’t been able to snowboard since (tragic though).

#3 – Macbook Pro – 2010 – Actually, I bought this. Then the little guy spoke up. Took it back the next day to Best Buy. Found a much, much, much better one a few weeks later on Ebay for the same price. That was a genius move.

So, that’s just a few of my adventures. I am sure I could think of a million more. I also have a list of purchase I still wish I never would have made, but that’s for another time.

“For those about to budget, we salute you.”

I’m out.