Classic “Money Rules” Applied to TIME
.Classic “Money Rules” Applied to TIME
FIRE is not a single point in time. It’s a lifestyle. If you follow a basic set of money rules it will lead to a financially successful life.
The same thing can be said about TIME. To me, 5am is not a single point in time, or a number on a clock face. It’s a lifestyle. Similar to FIRE, following a simple set of time rules will lead to a satisfying and life well spent.
I’ve written before about how the Pay Yourself First rule is similar to getting up early each day. (I pay the first few hours of every day to ME, not others – more here). It doesn’t matter if it’s 5am, 6am or 7… Paying yourself first each morning ensures you never lose out on personal time.
Classic “Money Rules” Applied to TIME
FIRE is not a single point in time. It’s a lifestyle. If you follow a basic set of money rules it will lead to a financially successful life.
The same thing can be said about TIME. To me, 5am is not a single point in time, or a number on a clock face. It’s a lifestyle. Similar to FIRE, following a simple set of time rules will lead to a satisfying and life well spent.
I’ve written before about how the Pay Yourself First rule is similar to getting up early each day. (I pay the first few hours of every day to ME, not others – more here). It doesn’t matter if it’s 5am, 6am or 7… Paying yourself first each morning ensures you never lose out on personal time.
So this got me thinking…. What other classic money rules can we apply to TIME?
Applying “Money Rules” to TIME
Money Rule: Equivalent TIME Rule:
Track your spending Track your time
Create a budget → follow it! Create a to-do or goal list → follow it!
Always max out your 401k Always max out your vacation time
Don’t buy shit you don’t need Don’t waste time on dumb stuff
Donate to charity / Tithe Volunteer and give time to others
Diversify, diversify, diversify! Always try new experiences!
Invest early, invest often Don’t wait. Do stuff while you’re young
You can’t predict a market crash, it could be tomorrow. You can’t predict when you’re gonna die, it could be tomorrow!
Tracking Your Time:
Just like your finances… Create a nerdy spreadsheet and track what you do each hour of the day. Start by gathering a full month of data, and tally up the results. If you’ve never done this before, I promise you the results will be sobering!
Next, compare all of your hours spent with your priorities in life.
How much time do you spend driving each week? How much time do you spend watching TV and movies? What about time spent browsing social media?
To continue reading, please go to the original article here:
Financial FOMO: What, Why and How To Avoid It.
.Financial FOMO: What, Why and How To Avoid It.
Financial Fear Of Missing Out
What is Financial FOMO?
You’ve probably heard of regular FOMO, which is the fear of missing out. It’s when you worry or have anxiety about missing out on fun and memorable experiences in life. What about Financial FOMO?
Financial FOMO is a little more specific. It’s when you worry about missing out on financial success or profitable events in life. You constantly research ways to make money, save money, and get ahead. You are excited about finances, but this feeling of excitement is matched equally with a feeling of disappointment from “not doing as good as everyone else seems to be doing”.
Personally, I don’t suffer from FOMO, financial or otherwise. I believe FOMO is an unhealthy mindset that makes people their own worst nightmare. Not only is it poisonous to let fear and anxiety occupy your mind, it leads you to do things you usually wouldn’t do.
Financial FOMO: What, Why and How To Avoid It.
Financial Fear Of Missing Out
What is Financial FOMO?
You’ve probably heard of regular FOMO, which is the fear of missing out. It’s when you worry or have anxiety about missing out on fun and memorable experiences in life. What about Financial FOMO?
Financial FOMO is a little more specific. It’s when you worry about missing out on financial success or profitable events in life. You constantly research ways to make money, save money, and get ahead. You are excited about finances, but this feeling of excitement is matched equally with a feeling of disappointment from “not doing as good as everyone else seems to be doing”.
Personally, I don’t suffer from FOMO, financial or otherwise. I believe FOMO is an unhealthy mindset that makes people their own worst nightmare. Not only is it poisonous to let fear and anxiety occupy your mind, it leads you to do things you usually wouldn’t do.
It might sound cool to have Financial FOMO, but it can actually be detrimental to your financial success. It’s the opposite of cool!
Example of Financial FOMO:
A week in the life of Steve…
Monday:
Steve wakes up at 6am and is very motivated. He goes for a morning jog while listening to his favorite podcast, The Entrepreneur Expert McMillions Secret Strategies Show.
The podcast features a guest speaker who built a $200,000/y business buying and selling raw land. He outlines 6 easy-to-follow steps for young and hungry beginners to start their own land flipping business. Truly inspiring content.
Steve is fascinated by what he hears! He gets home from his jog and writes down “land flipping” on his goal board for the year 2020.
Tuesday:
Steve goes out for drinks after work. His buddy, Tom, is at the bar bragging about his latest Bitcoin trade. Tom has been buying small amounts of Bitcoin ever since it was $30 per coin, and holds about $350k worth of Bitcoin today.
Steve feels a little bad that he never bought into Bitcoin back in the day, but Tom assures him he’s not too late to enter the cryptocurrency market. Tom’s advice is, “just throw 1000 bucks into bitcoin every month or so. It’ll be worth millions some day”.
That night Steve goes home and spends 3 hours reading news articles and watching YouTube videos about Bitcoin price predictions. Not ready to commit yet, he goes to bed without purchasing anything.
To continue reading, please go to the original article here:
Inflation Insurance
.Inflation Insurance
John Lim | Aug 23, 2021
ON AUG. 15, 1971, President Richard Nixon made the weighty decision to end the convertibility of the U.S. dollar into gold. By doing so, he drove a stake through the heart of the gold standard, a monetary system which fixed the worth of a unit of money to a specific amount of physical gold. Before that day, foreign central banks were able to exchange $35 for one ounce of gold from the vaults of the U.S. Federal Reserve.
By closing the so-called gold window half a century ago, Nixon ushered in the current era of fiat money. Fiat currencies—which include all currencies in existence today—aren’t backed by anything tangible. Rather, their value depends entirely upon the collective trust of people making transactions in those currencies. If that confidence evaporates, so does the value of that money.
Inflation Insurance
John Lim | Aug 23, 2021
ON AUG. 15, 1971, President Richard Nixon made the weighty decision to end the convertibility of the U.S. dollar into gold. By doing so, he drove a stake through the heart of the gold standard, a monetary system which fixed the worth of a unit of money to a specific amount of physical gold. Before that day, foreign central banks were able to exchange $35 for one ounce of gold from the vaults of the U.S. Federal Reserve.
By closing the so-called gold window half a century ago, Nixon ushered in the current era of fiat money. Fiat currencies—which include all currencies in existence today—aren’t backed by anything tangible. Rather, their value depends entirely upon the collective trust of people making transactions in those currencies. If that confidence evaporates, so does the value of that money.
What can lead to a loss of confidence in money? In a word, oversupply. Too much of anything can be a bad thing, and so it is with money. Print too much money and you devalue it. When a currency is devalued, inflation results.
Gold is called a precious metal precisely because it’s rare and difficult to mine. Though many have tried, gold cannot be fabricated. Because of this and other unique qualities, the yellow metal has been a store of value for over two millennia.
Gold’s value as an investment is far more controversial. Gold isn’t an investment in the traditional sense because it generates no cash flow. Result? There’s no way to assign an intrinsic value to an ounce of gold. In this regard, gold resembles other commodities. In all likelihood, however, gold will remain a store of value. Those who own gold, as I do, know that currencies have an uncomfortable history of being devalued. In my mind, gold is a form of insurance against this risk.
To continue reading, please go to the original article here:
Thoughts From DJ "Mind Pollution" 8-23-2021
.DJ: DID YOU KNOW?
In today’s world, no matter which direction you look, the constant bombardment of negativity is relentless.
The average person becomes engulfed with it like a flame gone wild. The COVID pandemic, nasty politics, inflation, border disputes, climate change, wars, a crumbling financial system, famine, energy needs, poverty, human trafficking and just about every conceivable and unconceivable horrible thing is all we are fed.
One cannot help but be infected by all this mind pollution.
When you are showered with so much negativity your mind begins to function in a different manor. Our capacity to envision a positive outcome to any venture one might partake in, in a given day, appears distorted and suddenly what would normally be an effortless task turns into questions and doubt.
DJ: DID YOU KNOW?
In today’s world, no matter which direction you look, the constant bombardment of negativity is relentless.
The average person becomes engulfed with it like a flame gone wild. The COVID pandemic, nasty politics, inflation, border disputes, climate change, wars, a crumbling financial system, famine, energy needs, poverty, human trafficking and just about every conceivable and unconceivable horrible thing is all we are fed.
One cannot help but be infected by all this mind pollution.
When you are showered with so much negativity your mind begins to function in a different manor. Our capacity to envision a positive outcome to any venture one might partake in, in a given day, appears distorted and suddenly what would normally be an effortless task turns into questions and doubt.
What should be effortless becomes a struggle. It’s like looking at beautiful picture with colors like no other and yet we fixate your eyes on the small fly that has landed on it.
We can become a victim of our own circumstances and continue feeling sad, scared and angry; or instead, we could choose to deal with injustice humanely and break the chain of negative thoughts and energies, and not let ourselves sink into it.
Listening to and emerging one’s self into the barrage of negativity is a barricade to living a true like. Without the capacity to feely shape our own lives, much like a sculptor might carve a stone, we inevitably slip into negativity and depression.
There are excellent and poor thinking habits just as there are healthy and unhealthy eating habits. We should try giving up all the thoughts that make us feel bad, or even just some of them, and see how doing that changes your life.
You don’t need negative thoughts. All they will ever give you is a false self that suffers. They are all lies.
We should not be so willing to believe in the words of others, (like the media and Intel bloggers). Instead, study the motives behind the words of the person or entity presenting them.
Stop for a second and think of how you would think or behave if you had zero influence from outside sources. All task would be doable.
DJ
How To Claw Back From the Edge of a Financial Cliff
..How To Claw Back From the Edge of a Financial Cliff
Cynthia Measom Fri, August 20, 2021
The pandemic hit many Americans right where it hurts — in their wallets. “Hitting rock bottom financially is something many people fear — and understandably so,” said Kate S. Mielitz, Ph.D., AFC, an assistant professor of family financial planning at Oklahoma State University. “To reach the point that you are struggling each month, maybe to just put food on the table, or you’re squeaking by but barely … or even have no savings, no accessible credit, no one that you can turn to for short-term or long-term assistance … those are all very scary situations.”
The good news is that once you’ve hit rock bottom, the only way to go is up. Here are some proactive steps you can take if you find yourself peering over the edge of a financial cliff and are overwhelmed with debt.
How To Claw Back From the Edge of a Financial Cliff
Cynthia Measom Fri, August 20, 2021
The pandemic hit many Americans right where it hurts — in their wallets. “Hitting rock bottom financially is something many people fear — and understandably so,” said Kate S. Mielitz, Ph.D., AFC, an assistant professor of family financial planning at Oklahoma State University. “To reach the point that you are struggling each month, maybe to just put food on the table, or you’re squeaking by but barely … or even have no savings, no accessible credit, no one that you can turn to for short-term or long-term assistance … those are all very scary situations.”
The good news is that once you’ve hit rock bottom, the only way to go is up. Here are some proactive steps you can take if you find yourself peering over the edge of a financial cliff and are overwhelmed with debt.
Change Your Mindset
“If someone has hit rock bottom financially, the first step is to get into the right mental mindset, said Khari Washington, broker and owner of 1st United Realty & Mortgage. “The stress, shame, and a feeling of defeat can do a lot of damage mentally.”
It’s easy to feel depressed and hopeless if you’re experiencing dire financial trouble. However, it will be more difficult to turn things around if you don’t change your mindset. For example, each time you feel defeated or have a negative thought, get into the habit of telling yourself that what you’re experiencing is a temporary setback, and you will overcome it in time.
Keep your head calm,” said Scott Spivack, marketing director at United Medical Credit. “In the event of a financial disaster, feelings of fear, grief and anger are natural. Well, you need to absorb these emotions and accept the new reality. Negative emotions like grief and fear can dent your ability to think rationally. So, it’s important to eliminate stress and stay calm in these trying situations. With a relaxed brain, you’ll be able to think clearly and make pragmatic decisions.”
Take Stock of Your Financial Situation
Even though it won’t be fun, you need to take the time to really understand where you are financially. “The first thing you need to do is to calmly and meticulously take stock of where your finances are,” said Eden Cheng, co-founder of PeopleFinderFree. “This will help you make a solid financial plan moving forward. This means taking into account any remaining income, your monthly expenses, your debt, and the amount of money you have in your savings.”
Make a Plan
To continue reading, please go to the original article here:
https://finance.yahoo.com/news/claw-back-edge-financial-cliff-155801347.html
Even Richer People
.Even Richer People
Posted August 19, 2021 by Ben Carlson
Working in finance is both a blessing and a curse.
The plus side is the industry pays above-average wages and it’s not back-breaking work. Some people in finance do work ridiculous hours but no one comes home with a sore back or blisters on their hands at the end of the day. 1 It’s also a profession you can perform well into old age.
The downsides are more psychological in nature.
There is a lot of money in the world of finance. You’re typically dealing with clients who have amassed vast sums of money. And there are always going to be peers or colleagues in the industry who make more money than you. If you’re addicted to keeping up with the Joneses, the finance industry can be a toxic working environment. There is an endless stream of people with more resources than you.
Even Richer People
Posted August 19, 2021 by Ben Carlson
Working in finance is both a blessing and a curse.
The plus side is the industry pays above-average wages and it’s not back-breaking work. Some people in finance do work ridiculous hours but no one comes home with a sore back or blisters on their hands at the end of the day. 1 It’s also a profession you can perform well into old age.
The downsides are more psychological in nature.
There is a lot of money in the world of finance. You’re typically dealing with clients who have amassed vast sums of money. And there are always going to be peers or colleagues in the industry who make more money than you. If you’re addicted to keeping up with the Joneses, the finance industry can be a toxic working environment. There is an endless stream of people with more resources than you.
I work in the world of finance so I know plenty of people who make a lot of money (way more money than me).
The problem is many of these people talk incessantly about money because they’re so insecure about it. It’s how they measure their self-worth which is a tough place to be because there is always going to be someone getting richer than you. Often times one of the biggest headaches for rich people is…even richer people.
Vanity Fair had an article recently about rich people in the Hamptons complaining about even richer people encroaching on their turf:
Along with random $50s strewn across the beach have come the ultra-monied themselves, who’ve flooded in in numbers many say they’ve never seen before, leaving even the rich people thinking the rich people are ruining the Hamptons. “There’s so much money now it’s nauseating,” said one woman who bought her house in Amagansett in 1991. “I’m a 1-percenter. But I bear no resemblance to these people.”
“Everyone with money is here,” she said. “If I weren’t here already, I wouldn’t come now. The conspicuous consumption is just gross.” After repeatedly passing by a house that belongs to “one of those hedge fund guys,” and watching him have enormous, fully-grown trees planted day after day, she said she finally stopped to ask the dozen or so workers on site about the cost. “They said they thought $50,000 to $75,000 a day,” she said. “I would suspect it’s closer to $100,000.”
Boo-hoo, am I right?
To continue reading, please go to the original article here:
https://awealthofcommonsense.com/2021/08/even-richer-people/
The 3 Phases of Making a Major Life Change
.The 3 Phases of Making a Major Life Change
by Herminia Ibarra August 06, 2021
Summary. The lockdown that we’ve all just lived through created a period during which a lot of people had the opportunity to reflect on plans for a career change. But reflection alone doesn’t get people very far. Those who are mostly likely to act during this kind of period are those who actively engage in a three-part cycle of transition — one that consists of separation, liminality and reintegration. The author explains how to make the most of each of these stages to effect real change.
Many of us believe that unexpected events or shocks create fertile conditions for major life and career changes by sparking us to reflect about our desires and priorities. That holds true for the coronavirus pandemic. A bit over a year ago, when I asked people in an online poll to tell me how the pandemic had affected their plans for career change, 49% chose this response: “It has given me downtime to rest and/or think.”
The 3 Phases of Making a Major Life Change
by Herminia Ibarra August 06, 2021
Summary. The lockdown that we’ve all just lived through created a period during which a lot of people had the opportunity to reflect on plans for a career change. But reflection alone doesn’t get people very far. Those who are mostly likely to act during this kind of period are those who actively engage in a three-part cycle of transition — one that consists of separation, liminality and reintegration. The author explains how to make the most of each of these stages to effect real change.
Many of us believe that unexpected events or shocks create fertile conditions for major life and career changes by sparking us to reflect about our desires and priorities. That holds true for the coronavirus pandemic. A bit over a year ago, when I asked people in an online poll to tell me how the pandemic had affected their plans for career change, 49% chose this response: “It has given me downtime to rest and/or think.”
That’s a good start. But if there is one thing I have learned from decades of studying successful career change, it’s that thinking on its own is far from sufficient. We rarely think our way into a new way of acting. Rather, we act our way into new ways of thinking — and being.
Yes, events that disrupt our habitual routines have the potential to catalyze real change. They give us a chance to experiment with new activities and to create and renew connections. Even in the seemingly “unproductive” time we spend away from our everyday work lives, we conduct important inner business — asking the big existential questions, remembering what makes us happy, shoring up the strength to make difficult choices, consolidating our sense of self, and more.
Enough has happened during this past year to make many of us keenly aware of what we no longer want. But the problem is this: More appealing, feasible alternatives have yet to materialize. So we’re stuck in limbo between old and new. And now, with most Covid restrictions at last falling away and a return to the office imminent, we confront a real danger: getting sucked back into our former jobs and ways of working.
How can those of us who want to make a career transition avoid that? How can we make progress toward our goals by building on what we’ve learned this past year?
Research on the transformative potential of a catalyzing event like the coronavirus pandemic suggests that we are more likely to make lasting change when we actively engage in a three-part cycle of transition — one that gets us to focus on separation, liminality, and reintegration. Let’s consider each of those parts of the cycle in detail.
To continue reading, please go to the original article here:
https://hbr.org/2021/08/the-3-phases-of-making-a-major-life-change
Are You Worth More Than You Earned
.Are You Worth More Than You Earned
Have you ever wonder how much money you earned over the years? I mean, it has to be a sizeable sum if you’ve been working for a while. I was thinking about this and came up with a natural follow-up question. Are we worth more than what we earned? After all, wealth is what you keep, not what you earn. We have been maxing out our 401k and investing for years. Our net worth is much higher than the average US household. However, I don’t know if it is higher than what we earned over the years. Let’s answer that question today.
This answer isn’t that difficult to find out, but you might be disappointed. It is extremely difficult for your net worth to exceed your cumulative earnings, especially when you’re younger. It gets a little easier as you age because of compound interest, but I’m sure only a small percentage of households can achieve this impressive feat. That’s because saving and investing aren’t enough. You need a lot of time and luck as well. It is not impossible, though.
Are You Worth More Than You Earned
Have you ever wonder how much money you earned over the years? I mean, it has to be a sizeable sum if you’ve been working for a while. I was thinking about this and came up with a natural follow-up question. Are we worth more than what we earned? After all, wealth is what you keep, not what you earn. We have been maxing out our 401k and investing for years. Our net worth is much higher than the average US household. However, I don’t know if it is higher than what we earned over the years. Let’s answer that question today.
This answer isn’t that difficult to find out, but you might be disappointed. It is extremely difficult for your net worth to exceed your cumulative earnings, especially when you’re younger. It gets a little easier as you age because of compound interest, but I’m sure only a small percentage of households can achieve this impressive feat. That’s because saving and investing aren’t enough. You need a lot of time and luck as well. It is not impossible, though.
Savings
For most of us regular employees, it is very unlikely to be worth more than we’ve earned. First, taxes take a big bite out of our paychecks. After that, we all have bills to pay. Money gushes out every month to pay for housing, healthcare, transportation, food, clothing, travel, entertainment, techs, and all kinds of stuff. It’s tough to save when you add up all the expenses of the modern lifestyle. In addition, we need to invest those savings. It is mathematically impossible for your net worth to surpass your cumulative earnings if you simply save it. Even if you save 50%, your net worth will only be 50% of what you made. You need to invest and grow those savings to even have a chance.
Generally, financial advisors recommend saving 10-15% of your income for retirement. This might be fine if you plan to retire at 67, but 15% won’t cut it here. Your net worth will never catch up to your total earnings by saving 15%. You’d need to save and invest at a much higher rate to win this one. Let’s look at our household as an example.
Income
First, we’ll look at how much we’ve earned over the years. The easy way to figure this out is to head over to socialsecurity.gov and check your Social Security statement. Here is a graph of our household earned income.
This graph is actually pretty neat to go over. My earnings shot up sharply when I graduated college and started working full time in 1996. It kept rising and peaked at $200k in 2012 when I quit working full time. The zenith was an anomaly because I worked just 6 months and sold a bunch of stock options. Part of the gains was counted as earned income. As expected, my earned income took a sharp dive after I retired from my engineering career. However, I continue to generate some income from blogging after early retirement.
To continue reading, please go to the original article here:
The Stuff They Don’t Teach You In Books
.The Stuff They Don’t Teach You In Books
Posted July 27, 2021 by Joshua M Brown
Once upon a time, when I knew nothing, I called myself a financial advisor. It’s true, I was giving financial advice. But when I look back to the caliber and quality of that advice from back then to now, it’s astonishing how much I didn’t know.
I was raised in this business to believe that stock and bond and fund selection was the most important aspect of helping investors succeed. We weren’t given a benchmark in terms of what a client succeeding even meant. Was it beating the S&P 500? Looking smarter than the client’s other broker?
Hitting a grand slam in a technology stock? Generating the highest interest and dividend income? I don’t know. The client doesn’t know. “Lets emphasize whichever of these things went well in the next conversation.”
The Stuff They Don’t Teach You In Books
Posted July 27, 2021 by Joshua M Brown
Once upon a time, when I knew nothing, I called myself a financial advisor. It’s true, I was giving financial advice. But when I look back to the caliber and quality of that advice from back then to now, it’s astonishing how much I didn’t know.
I was raised in this business to believe that stock and bond and fund selection was the most important aspect of helping investors succeed. We weren’t given a benchmark in terms of what a client succeeding even meant. Was it beating the S&P 500? Looking smarter than the client’s other broker?
Hitting a grand slam in a technology stock? Generating the highest interest and dividend income? I don’t know. The client doesn’t know. “Lets emphasize whichever of these things went well in the next conversation.”
Twenty years have gone by and now I know a lot. At least compared to the original version of me as a financial advisor. I’ve surrounded myself with Certified Financial Planners. I’ve attended hundreds of industry conferences. I’ve written three books and ten thousand blog posts. I’ve done fifteen hundred hours of financial television. I’ve read a million words on the profession.
I’ve sat in a thousand client meetings. Drank coffee, wine, beer and tequila with hundreds of financial advisors when their guards were down. I’ve been in the green rooms at all the events. I’ve seen the notes from the pre-interviews with producers. The private parties. The dinners (so many dinners).
I’ve met the chief marketing officers and the PR people for every trillion dollar asset manager in America. I’ve been there for the bell ringings, the product pushes, the service launches, the beta tests, the branding exercises.
I know some stuff.
Like finding my way up in the clocktower behind Big Ben, watching the gears turn. Everyone in London can look up and observe time going by from the outside. I can see how the big hand and the little hand got that way from the inside.
And some of the things I’ve come to learn have never been taught in any textbook or on any exam given industry-wide. These unwritten things are the key to everything. I’ll share a few today…
1. Every thousand dollars you help a client save on taxes is the equivalent of earning that client ten thousand dollars in returns, based on how grateful people are. I don’t know why it is that way. There’s something about “I saved you money” that’s ten times more emotionally satisfying than “I made you some money.” Probably because money made in the market usually continues to remain at risk in a portfolio, while money saved on taxes feels more kept and permanent.
To continue reading, please go to the original article here:
https://thereformedbroker.com/2021/07/27/the-stuff-they-dont-teach-you-in-books/
"Velocity of Money" From Virginia Gentleman
.Re-posted for our newest readers……
From Virginia Gentleman VELOCITY OF MONEY
I know I don't have to state the obvious...GO HAVE FUN WITH SOME OF YOUR NEW FOUND WEALTH. However, I would like to pass on some words of wisdom.
As we get ready to punch it in, please remember to act like you've been in the End Zone before. Take a deep breath and exhale slowly as you collect yourself with the full intentions of acting with class and integrity.
Respectful treatment of others will be an inherent responsibility of your new status, as well as respectful treatment of your money and assets. You owe this to yourself, your family, your neighbors, and your heirs.
Don't hoard it, and on the other hand, don't waste it or give it all away. Save, invest, and spend wisely.
One of the single best things you can do with a small portion, and in effect a very small portion, is to be more generous over at least the next 18-24 months (or the longer) spending your money locally. What do I mean? The answer is the ‘VELOCITY OF MONEY’.
Re-posted for our newest readers……
From Virginia Gentleman VELOCITY OF MONEY
I know I don't have to state the obvious...GO HAVE FUN WITH SOME OF YOUR NEW FOUND WEALTH. However, I would like to pass on some words of wisdom.
As we get ready to punch it in, please remember to act like you've been in the End Zone before. Take a deep breath and exhale slowly as you collect yourself with the full intentions of acting with class and integrity.
Respectful treatment of others will be an inherent responsibility of your new status, as well as respectful treatment of your money and assets. You owe this to yourself, your family, your neighbors, and your heirs.
Don't hoard it, and on the other hand, don't waste it or give it all away. Save, invest, and spend wisely.
One of the single best things you can do with a small portion, and in effect a very small portion, is to be more generous over at least the next 18-24 months (or the longer) spending your money locally. What do I mean? The answer is the ‘VELOCITY OF MONEY’.
The Velocity of Money is a fairly simple financial concept where a ‘community’ can be positively impacted by the way a group of individuals increase the spending of their money in their economy, and in turn, the ripple effect of that spending as it accelerates throughout that same economy.
It can be local, regional, national, and even global. Velocity of money is most effective in a smaller market with the smaller more predictive population of a local economy, and it isn’t just effective, it is fun for the people spending their increased earnings, or in this case, significant returns on an investment. Yep, that is you!
Anyone who has ever lived in a small town or Suburban area where a new large company has come in and opened a large facility and hired a large amount of employees has witnessed this phenomenon.
Money gets pumped in and spending from increased disposable income begins to spread out through the entire community finding its way into the wallets of all the inhabitants.
The goal is to spend your money at local establishments on services, appliances, home improvements, food, entertainment, and such.
More precisely on things like tipping an extra 5-15 percent, using a valet to park at the local steakhouse (tipping extra), go hear a local band (put money in the tip jar), buy cheese or pork or beef at a farmers market instead of 2 month old shrink wrapped processed cheese from a Big Box store or grocer, get an extra manicure or haircut (tipping extra!), get your car repaired at the mechanic down that side road instead of Walmart or the Dealer.
Buy those nicer hiking boots ‘Made In America’, get your computer cleaned up by that geek in the shop she set up in the old 7-11 building, buy your lumber from the local milled lumber supplier not the National Chain hardware store, deal with a local community bank or credit union with a substantial portion of your money… you get it now right.
Think about it. You may be spending either the same amount or perhaps an extra 10-20%, and you’re getting the same things… OFTEN WITH THE BONUS OF MUCH HIGHER QUALITY PRODUCTS WHILE GETTING TO KNOW YOUR NEIGHBORS ON MAIN STREET!!!
I personally look forward to trying some of the world’s best Craft Breweries in Richmond (tipping generously) and touring some of Virginia’s wineries (tipping generously)… jealous of you Kentucky folks that can tour the best ‘Bourbon’ distilleries on the planet, or you ‘Whiskey’ lovers in Tennessee just outside of Fayetteville down the Admiral Frank B Kelso highway or those in Nashville who can wander in a restaurant and catch a ‘local’ band like Kenny Chesney, lol. Believe it!
By doing this the dominoes of positive change begin to fall within your local community. The ripple effect is that the waiters, mechanics, manicurists, hairstylists, valet, carpenter, plumber, artisan cheesemaker, farmer, and others in your community begin to make more money.
And what do they do? They go out and spend more, tip more, consume more. Your local tax authority makes more sales tax revenue and spends it on improvements.
I’m in America, but the Velocity of Money is true in Canada, Great Britain, Iraq, Vietnam, or anywhere. And guess what? Since this is fun stuff you’ll be doing while spending your hard earned money, you will also be wearing a BIG smile.
There is nothing more infectious and quick to spread goodwill than passing on your smile accompanied by kind words. So be wise with your prosperity and have some fun …LOCALLY.
The fruit you bear will fall from your tree and spread its seeds…
Live and grow in the nine fruits of the Spirit and you will sow the nine fruits…
Love, Joy, Peace, Patience, Kindness, Goodness, Gentleness, Faithfulness, and Self-Control.
Take care –Virginia Gentleman
Other People’s Mistakes
.Other People’s Mistakes
Aug 5, 2021 by Morgan Housel
George Carlin once joked how easy it is to spot stupid people. “Carry a little pad and pencil around with you. You’ll wind up with 30 or 40 names by the end of the day. It doesn’t take long to spot one of them, does it? Takes about eight seconds.” Like most comedy it’s funny because it’s true.
But Daniel Kahneman mentions a more important truth in his book, Thinking, Fast and Slow: “It is easier to recognize other people’s mistakes than our own.” I would add my own theory: It’s easier to blame other people’s mistakes on stupidity and greed than our own. That’s because when you make a mistake, I judge it solely based on what I see. It’s quick and easy.
But when I make a mistake there’s a long and persuasive monologue in my head that justifies bad decisions and adds important context other people don’t see. Everyone’s like that. It’s normal.
Other People’s Mistakes
Aug 5, 2021 by Morgan Housel
George Carlin once joked how easy it is to spot stupid people. “Carry a little pad and pencil around with you. You’ll wind up with 30 or 40 names by the end of the day. It doesn’t take long to spot one of them, does it? Takes about eight seconds.” Like most comedy it’s funny because it’s true.
But Daniel Kahneman mentions a more important truth in his book, Thinking, Fast and Slow: “It is easier to recognize other people’s mistakes than our own.” I would add my own theory: It’s easier to blame other people’s mistakes on stupidity and greed than our own. That’s because when you make a mistake, I judge it solely based on what I see. It’s quick and easy.
But when I make a mistake there’s a long and persuasive monologue in my head that justifies bad decisions and adds important context other people don’t see. Everyone’s like that. It’s normal.
But it’s a problem, because it makes it easy to underestimate your own flaws and become too cynical about others’.
I try to stop myself whenever my explanation for other people’s behavior – financial or otherwise – is “well, they’re not very smart.” Or greedy. Or immoral. Yeah, sometimes it’s true. But probably less than we assume. More often there’s something else going on that you’re not seeing that makes the behavior more understandable, even if it’s still wrong.
A few things make it that way.
1. When judging others’ poor behavior it’s easy to underestimate your own susceptibility to the power of incentives.
The worst behavior resides in industries with the most extreme incentives. Finance, where scams are everywhere. High-end art, where counterfeits proliferate.
But it’s important to ask: Are immoral people attracted to industries where there are big rewards for bad behavior? Or do big rewards for bad behavior cause good people to slide into immorality, justifying their decisions along the way? I think so often it’s the latter.
It helps explain things like the 2008 financial crisis. Was it caused by greedy bankers? Maybe here and there. But the huge majority of it was good, honest people who wanted to do the right thing but whose definition of “the right thing” is instantly warped when they’re paid $8 million a year to sell subprime bonds.
Incentives are almost like a drug in their ability to cloud your judgment in a way you would have found unthinkable beforehand. They can get good people to justify all kinds of things.
That doesn’t excuse bad behavior. But it’s hard to know what you’d be willing to do until you’re exposed to an extreme incentive, and that blindness makes it easy to criticize other people’s mistakes when you yourself may have been just as tempted if you were in their shoes.
2. It’s hard to tell the difference between boldness and recklessness, greed and ambition, contrarian and wrong.
To continue reading, please go to the original article here: