Money Thoughts

If you like to learn while you read, but not be bored with academic textbook style reading, I suggest a book called “The One Minute Entrepreneur” by Ken Blanchard and Don Hutson. It’s a story with a lot of great lessons along the way. At the end of each chapter, the main points learned by the characters are highlighted. With so many great pointers about being a successful entreprenuer, and many quotes from some of the greatest business teachers, this was a book that I recommend for anyone who has their own business or would like to start one.

Remember, many times its the limitations of your “job” that will keep you poor. Only you can make the decision to do more with your life.

So my wife got me a really good book for my birthday and I came across a VERY enlightening comment this morning while reading it

“Happiness is a result of what you believe and what you do, not a result of what happens to you.”

If you come to really understand and study what this means to you in your life, you will see that your happiness depends 100% on you, and nothing else. If you are not happy in your life, start believing differently and doing things differently, and happiness can be yours.  Like the famous Apple Tag line says:

“Think Different”

There are a lot of business books out there that talk about how large companies neglect to adapt while the world that made them big changes around them. Change in our world is inevitable, and it’s up to people to adapt to it to survive. I am always amazed at how little companies rapidly get large because of their ability to change with the world around them. I highly recommend anyone thinking about entrepreneurship to read the book “If it ain’t broke, break it!”.

This week I am making a change in my life that some people would think I was crazy to do. In fact, I know MOST people would think it “unwise”. The fact of the matter is that the world is changing around me and I have been doing nothing but watching and resisting. Much like the big companies who fail to make necessary changes with their customers needs and end up bankrupt, that is where I felt I was headed. This pudgandplum blog was built to help me understand the world of blogging better and to help me change and grow a little more with technology. The next step for me has come to now focus harder on the website portion. I have been in companies that done changes that have negatively affected the lives of those around them. I see a storm ahead for the company I work for and count my blessings that there are clear warning signs that give me just enough time to protect myself and get out of the way of the turmoil.

I believe that the news we see and hear everyday are also giving warning signs of the years to come. There is a great possibility that our nation will have very hard times ahead economically, and people are ignoring the warnings. It’s like being told you’re standing in a building that will fall in an hour and even though you can see and hear the cracks forming in the walls, you stay to say that it’s not your problem, someone else better stop it from collapsing because your not leaving for safety because it’s not convenient right now. In the end, you will fall with the building around you. At that point you can try to blame everyone around you, but the fact will remain you ignored the warning.

If you are in a job that has bosses above you who have the ability to lay you off, you need to protect yourself. Find a second source of income that can sustain you if you lose your job. Don’t be foolish to think that you are indispensable. Everyone can be replaced, yes, everyone…  As much as people think they are too precious, they’re not. If the company gets sold or closes it’s doors, it then doesn’t really matter how valuable you “thought” you were.

Look at what’s going on around you. See change for what it is. Ask yourself how can you make lives easier for people, or is there a problem you are noticing that a product you create could make it easier for others in their everyday lives? Look at your company from the inside out and ask yourself what could be done better, or what is the company missing that you could do on your own? Open your eyes, then open your mind.

I remember reading somewhere that everyone has a million dollar idea, but most will never know it, or have the guts to implement it. Starting today, I will start working hard on what I think is my million dollar idea. Will you start on yours?

This week I had eye surgery done to remove some scar tissue that started to cover my pupil. One of the rules I had to follow was that I could not eat anything after midnight until the surgery was over. My surgery ended at about 2pm, so needless to say I was starving, but nauseous from the surgery and having a patch on my eye. At this point I was amazed at how easy we live our lives here in the US. When we are hungry, we eat. At anytime, we can go and get food practically anywhere. There are hundreds of thousands of people in Burma and China who are starving and can’t get to food right now due to natural disasters. Of course, there are those in other areas who never have food or clean water at their disposal either. So here I am complaining about feeling a little sick, and a sense of guilt overwhelms me. I guess I also end up getting a little worried about what I would do if I couldn’t afford to eat or had access to food. Scary.

With that being said, I have no words of wisdom other than to say, maybe each of us should really be aware and thankful of the blessings we have. (and it might not hurt to prepare in case we have not)

This is a good article on how any positive news about our economy could be just a mirage.

http://biz.yahoo.com/ap/080510/economic_mirage.html

I’ve been on a business sales trip again this past week. This time to Houston and drove out for a day to Austin. While meeting with clients, one thing I noticed was that all the business owners had other marketable skills that equaled, if not exceeded their current business, in other industries. It blew me away to see all of these VERY successful  entrepreneurs working on the side in things that were (in some cases) totally unrelated to their primary “bread and butter” businesses. On most occassions, these side ventures were definitely multi-million dollar ideas if marketed right.

The spirit of entrepreneurship is in their blood. It keeps them looking for opportunities to enhance their business, and sometimes better “new” ideas pop-up instead that seem logical to pursue. Many people know of the Post-it creator who was trying to create the ultimate adhesive and instead ended up marketing a super weak sticky stuff that makes itself removable on paper. Brilliant!

The lesson we all need to learn from this is that we all need to open our eyes and diversify our skills and knowledge better to create opportunity for ourselves. Never settle and be comfortable where you are or opportunity will pass you by. Think about what other things you have skills or interests in that could change the world completely for the better. If you don’t move on it first, someone else will.

Here is a story that I’ve heard a few times throughout my life. It’s always been a constant reminder to me of what kinds of obstacles are put in our way that stop us short of accomplishing great things when we are so close. There have been so many times I’ve quit in my life where others have said I was justified and my actions understandable. Fooling myself for every “non-accomplishment” of telling myself that I did the right thing, when in my heart I knew I could have done more, or done better, but instead chose the easy way out…to quit.

Keep Your Goals In Sight

When she looked ahead, Florence Chadwick saw nothing but a solid wall of fog. Her body was numb. She had been swimming for nearly sixteen hours. Already she was the first woman to swim the English Channel in both directions. Now, at age 34, her goal was to become the first woman to swim from Catalina Island to the California coast. On that Fourth of July morning in 1952, the sea was like an ice bath and the fog was so dense she could hardly see her support boats. Sharks cruised toward her lone figure, only to be driven away by rifle shots. Against the frigid grip of the sea, she struggled on – hour after hour – while millions watched on national television. Alongside Florence in one of the boats, her mother and her trainer offered encouragement. They told her it wasn’t much further. But all she could see was fog. They urged her not to quit. She never had . . . until then. With only a half mile to go, she asked to be pulled out. Still thawing her chilled body several hours later, she told a reporter, “Look, I’m not excusing myself, but if I could have seen land I might have made it.” It was not fatigue or even the cold water that defeated her. It was the fog. She was unable to see her goal. Two months later, she tried again. This time, despite the same dense fog, she swam with her faith intact and her goal clearly pictured in her mind. She knew that somewhere behind the fog was land and this time she made it! Florence Chadwick became the first woman to swim the Catalina Channel, eclipsing the men’s record by two hours! Even when you can’t see your goal with your eyes, you can always picture it in your mind. Let that be the strength to take you where you want to go!

Here it comes….The lecture on what to do with your money when you get a gift. Personally, I have a strong belief that there is a very specific breakdown on how you should take care of income. Whether the income comes from your paychecks or from a free rebate from the government, here is how income should be broken down.

1. Give at least 10% to tithing or if you don’t go to church, donate it to a worthy charity. For Christians, this type of action shows God how strong your faith is toward him. God promises blessings back 10 fold for being faithful in your giving. For non-believers, this act of giving us called the “Law of Reciprocity”. A principle of what goes around, comes around. Try it…See what happens!

2. Give yourself 10% to treat yourself. This is the principle of what the rich call “Paying yourself first”. What is left after the Giving and the Paying yourself then becomes more flexible.

3. Put 10% to long term savings. This is your retirement fund.

4. Put 20% toward, something you can invest in and take risks worth. I recommend breaking this down into half. put half of it into account to spend on the risky investment and the other half on educating yourself. Take seminars or buy books and tapes on the subject you want to invest in. This will help to minimize your risk.

5. Lastly, you should be left with the last 50% of the money you want to break down. Hopefully its enough to now pay bills with and survive on for everyday expenses. If it’s not, you have 2 big decisions to make. First, make more money. Second cut the regular expenses you have down so you can do 50% of your income to survive on.

This message above is a difficult thing to do for most people, but if its a habit created early by your kids, 2 great things happen. First, they will have secured their future and those of your future generations, and second, they will have learned to live within their means and be smart with their money.

So take that free rebate and show them how you and the family will break it down to where it makes sense!

Is there a refund for you?  Our accountant informed us we’re getting a refund this year. When we originally went for our tax appointment she thought we would end up paying about $6,000, but after she received all the additional paperwork she needed and was able to input all the final numbers into the computer the results changed dramatically.

Funny thing is this. My wife and I set a goal to go to Japan this year on the condition that accomplish making a certain “large”  amount of funds in additional to our regular incomes from our jobs by the end of May. Well..our tax returns covered over 90% of that goal. We’ve been praying on it and working on ideas to accomplish this and it seems that it’s working itself out. Now I am not saying that just because we prayed and set our sites on a goal that God dropped this money in our lap. We’ve been working at what we thought could be ways of accomplishing the goal. I truly believe that the combination of faith and action is what makes special “unexpected” blessings appear.

If you are a person who believes in Jesus, here are some things I believe can help you in your financial need.

1. Be faithful in your giving (tithing).  Nothing shows your belief in God and his power more than tithing your minimum of 10% of your gross income. (The bible says to be a cheerful and faithful giver, and God will bless you)
2. Take care of your money. (The bible says if you can take care of little, then you can be trusted to care of much)
3. Ask for what you want. Pray on it and look for ways God is trying to show you of opportunities to make more.
4. Work hard/take action. Do not expect for the blessings to be dropped in your lap. God wants you to appreciate what he’s blessed you with by making sure you feel you’ve worked to earn it.

Since statistically speaking 80% of the people reading this most likely believe there is a God, then why fear trying these steps? These 4 things are Bible based and have proven to work time and time again. I suggest reading the book of Proverbs, reading and analyzing 1 chapter a day. You’ll get through it in a month and be amazed at the simple wisdom in it for everyday successful living.

Hopefully you’re getting a refund this year. I am dreading what kind of changes we’ll see with taxes when the next President we elect takes office. Our economy is still sliding hard and the world is rattling from the fallout. I can’t wait till we get into a good position to buy apartment buildings. That’s my plan…What’s yours? If you do not have a plan for the future its like not having a road map in a foreign land. You’ll be wandering endlessly hoping to reach your destination.

This week has been a very busy one for me. Getting ready to travel next week on business for 3 days has kept me from doing too much reading on all the news I normally like to keep up on. Next week will be tougher, but all is good.

My wife and I have been taking care of a dog that my wife named “Peanut”. She’s a lot of fun, but needs a home with a yard and a family that has more time for her. Any takers? Here is how she greets us everyday we come home!

You were put on this earth with gifts to share with the world. You may not think you have a lot to offer others, but you are wrong. Yeah, this may sound a little harsh and your heart might start pumping a little faster now with anger, but know that I am telling you this for your own good. You have gifts, and if you are not sharing them with others, you are wasting your short time you have here on this planet. Think about anything you’ve ever taught someone that made them happy because they were able to now do it themselves. (Now if you’ve never taught anyone anything, you either do not remember doing it because it was effortless, or you don’t get out enough.) Have you ever been asked to train someone at work perhaps? Or if you have kids, have you ever shown them something that others could not?

With the internet today, your ability to share your gifts with the world can now be done with ease. What’s even better, your ability to make money sharing your gifts is also something that could help provide you with a little income. Duplicating yourself is the concept that the rich have mastered. Video tapes, books, ezines, etc are all ways that you can duplicate your knowledge, thereby duplicating yourself. With the internet, you can be in 1 million + homes teaching people stuff all at the same time. Embrace technology!

Today’s economy is getting rough, and it only looks to get rougher. Unemployment numbers today were bad, and the stock market is reacting to it today. Undoubtedly tomorrow holds more bad news as well, and I predict we’ll see a slight drop in the overall market. ATA and Aloha Airlines, 2 big airlines that service Hawaii, have both collapsed and another 5000 jobs are lost overnight. The trickle effect to other industries that survive on Hawaii tourism will be hit hard, which could also cause a lot of layoffs in the hotel sector, retail sector, manufacturing, and even restaurant industries.

Take the time to figure out what you can offer others and find ways to market your skills.

R.IS.E = Residual Income Solves Everything”(c)
Learn this concept and you’ll enter the world of financial security…

Good luck!

There is no doubt in my mind that Ben Bernanke is a very intelligent man and quick to make things happen. For a very long time I couldn’t figure out why he avoided saying that we are heading into a recession that can’t be stopped? I see today what is finally going on. He is starting to “hint” that we are going into a recession to cover his tracks about when he said he thought we were going to be fine, even when he knew better. My theory is that he needed to pump confidence into the market for as long as he could to prevent a massive disaster. Even Alan Greenspan, the former Fed Chairman, knew this was coming.

Recession is inevitable, but saying it now would be disastrous. American people need to believe the government can take care of them. They’ve been conditioned to believe the government has a handle on our economy and knows what it is doing.

The other thing today is Energy report. What a shock! (yes, it’s sarcasm) It basically pointed out gas prices may go up again. oh boy…

Prepare for a long summer. Stock up when things go on sale, because we are heading toward some big inflation trends.

I was watching a “how to sell” video presented by a guy named Blair Singer, who is the author of a book called “Sales Dogs“. Not only is he a great salesman, but he’s also really good at teaching others to sell and getting over mental blocks. While watching the training video, there was something that really stuck with me.

After talking a little about doing everything you can for your customer and the importance of making sure you ask for the sale, Blair Singer goes on to say that you need to ASK for something in return, otherwise “You breed what I call criminal behavior and you’re actually conditioning people to get something for nothing.”

Mmmm, let’s think about it. He may have a point there. There are many parents that may disagree with me, but I still want to make a point that I do not believe that children should be given spending allowance just for existing, or for doing things they are supposed to do as a member of the household. How would I teach my kids to deal with being responsible for money? Glad you asked, here are my 5 suggestions:

1. At the beginning of the week, give your kids all the money they need for the week for things they must spend money on to survive daily, like lunch money. Be clear what the money is for and that if they lose it, they will have to find their own way to get lunch. Show them the breakdown of what each penny is for,
2. Tell them chores are a requirement for living in the household, not for payment of allowance. If they do not do their chores, they lose privileges or get grounded. What ever means you normally do for punishment. If extra chores are done that are above and beyond normal household necessities, then payment can be made and extra things get done.
3. Require that all allowance be earned by extra chores only and that 10% be put toward saving and 10% to tithing. Make this a habit and you won’t regret it the earlier you start. These are habits that can be created that can save your children in the future.
4. Have them learn what types of things you have to pay for and how you make your money. Explain the benefits to them of saving and tithing (or giving to charity).
5. Lastly, and probably the most important, when you hear that they want something, sit them down and ask them how they can earn enough to get it. Let them think of ways they can create an income. You’ll be amazed at what they think of!

Remember, it takes effort to “earn” something. Don’t let your kids grow up with such a “something for nothing” mentality that they don’t end up doing anything for themselves. I see it around me everyday…Parents who give into their kids whining, when they should be disciplining them. There are lot of great kids out there, and one thing I noticed about those who are really good kids, they know if they do something wrong there will be consequences to pay from their parents… It’s how it should be.

My mother once apologized to me that she was sorry she could not help my sister and I more financially while we were in college. With a sad tone in her voice, she explained how bad she felt that she had to make a decision to save for her retirement over helping me pay for my education. Honestly, when it comes to decisions she’s made with regards to her finances, I think it was the best decision she ever made. My sister and I have a lot of college debt, so what, at least we don’t have to worry about supporting my mother (like many families today who are supporting both their kids and parents today). I personally have over $25,000 in student loans and I am glad that my mother never helped me with my college expenses and decided to secure her financial future first. Working 60+ hours while going to school was one of the best life lessons I could have ever received about how tough life can be, but also how much I can personally accomplish on my own. My mother would not have been able to take an early retirement and enjoy her free time today with her grandkids had she spent her retirement helping me through college. She has some medical issues that made her work painful for her, and if she had to stay employed with all that pain, it would’ve deeply saddened me. My mother instinctively knew that she could potentially become a financial burden to her children if she didn’t position herself well for retirement. Perhaps it was because she was never handed anything and raised 3 children all by herself.

Two years ago I was heavy into educating people on financial matters and understanding money. While doing seminars, meeting with people privately, and even co-hosting a financial education radio show I focused a lot of my financial teachings on helping parents understand that college is a huge expense that must be planned for early together with their kids and that it should be secondary to their retirement planning. As a Certified College Planning Specialist (back in 2006) learning the in’s and out’s of how to position and educate parents for the high expenses of their children’s education, time after time I found that many parents were putting themselves in positions where they would be hurting their retirement years in order to get their kids through college, without knowing the potential consequences.

If you are a parent, there are things you need to realize:

1. If you spend your retirement on your children’s education, you may end up needing them to support you in your retirement years. Think about what could happen if they had a spouse and kids and a portion of their income had to help you survive?
2. If your child does not know what they want to major in, send them to a community college to get their core classes out of the way, or don’t send them at all till they are ready to. Let them have the “real world” education and emotionally support them in whatever they decide to do. Encourage them to learn about how investing works and making their money work for them, instead of them working for it.
3. Something like 70% of college grads do not work in the field they got their degree in. Don’t expect too much $ value nowadays for a college degree if they are just getting one to get out into the real world without thought, because an “easy to get” bachelors degree doesn’t seem to hold much weight anymore, statistically speaking. I personally strongly believe that a college education is important  to help in growing up as a well rounded adult, but there is enough evidence to show that many times experience and good communication skills can out do a college education.
4. Let your kids learn the value of money by making them learn to earn it. This means, force them to get jobs if they want spending money. Getting into the workforce early teaches great lifetime skills on how to relate with others. Hopefully they also learn other valuable lessons like taxes will rob you of most of your wages and working for others is not going to make them rich.
5. I personally think that getting”let go”or “laid off” can sometimes be one of the best life lessons a young adult can experience. An experience like that can teach them early that they should never rely on anyone else to feed them, and when they recover, they will realize that it isn’t the end of the world. They need to learn to set things up that will secure their future.
6. Lastly, your teen children will need to be told that they are expected to help with college expenses while still in high school by:
   1. Planning ahead and committing to doing well (starting from the 9th grade).
   2. Taking as many college courses while still in high school.
   3. Getting good grades and work hard to get scholarships.
   4. Saving to help with some of the expected college expenses outside of tuition, like books and supplies. (computers aren’t cheap, but a definite necessity today)
   5. Working while in high school. (I know this is controversial amongst parents depending on your upbringing, but I have personally have seen many benefits when high school students used to work for me.)

Bottom line…I feel the best way to let your kids experience being an adult is letting them support themselves. Especially through the college years.