Want to be a millionaire? Don't overspend and use debt wisely.
We all may not be millionaires but there are plenty of financial and life-planning secrets we can learn from the well-heeled.
Most people know that wealth in the U.S. is in the hands of a small percentage of the total population. And, today, most of those folks with a net worth of $1 million or more have earned it themselves.
They're mostly entrepreneurs who create everything from high-speed networks to garbage haulers. They dig ditches and build houses and grow corn and make jewelry. They deal stamps or coins or artwork and control pests and cut lawns. They also cure people and give them new teeth. Others will defend their neighbors or even feed them.
And they're not big spenders. In fact, most of those with big bucks live well under their means -- think about Warren Buffett still living in that modest Omaha home -- and they put their money instead toward investments that help them stockpile more wealth.
"Wealth is what you accumulate, not what you spend," according to Thomas Stanley and William Danko, the authors of the seminal tome on America's wealthy "The Millionaire Next Door," first published in 1996.
"It is seldom luck or inheritance or advanced degrees or even intelligence that enables people to amass fortunes," the authors wrote. "Wealth is more often the result of a lifestyle of hard work, perseverance, planning, and, most of all, self discipline."
Wealth is defined in many ways, though it's generally determined as the value of everything you own minus debts. But there's a difference between marketable assets -- things you own that could be liquidated rather quickly, like stocks, bonds, real estate -- and possessions like cars, clothing and household items that you use regularly and aren't likely to sell.
Income alone does not make one rich. It helps, of course, to build wealth, but the financially independent look to their salaries as a means to an end, which is that pile of cash.
"The wealthy don't spend their wealth on discretionary purchases," said Pam Danziger, founder of Unity Marketing, a consumer market-research firm specializing in luxury goods and experiences. "They get rich by maximizing the value of their investments."
That doesn't mean they don't pay big bucks for pretty shoes or outfits, but that most choose those items carefully and shop for value and quality. "They truly evaluate the purchase as an investment, not an expense," Danziger said.
What they do though is diversify those investments, which gives them more flexibility to ride out difficult times. "The wealthiest clients have very, very diversified portfolios that go way beyond just stocks and bonds into hedge funds, currencies, commodities and emerging markets," said Leslie Lassiter, managing director of the JPMorgan Private Wealth Management.
"There are many, many mutual funds out there that will allow you to get exposure to those types of asset classes," Lassiter said.
Among the biggest differences between those flush with cash and those wishing they were is in how they pay for things. Millionaires tend to use cash for most of their purchases, including cars, homes and boats.
For the average wage earner, of course, that's not always an option but it still holds this lesson: Don't look to debt to fund your lifestyle.
Most wealthy people use debt for investment purposes and are careful not to over-leverage themselves. "A prudent use of debt is an appropriate thing for anyone," Lassiter said.
They also plan very well and spend a lot of time at it. Many are compulsive savers and investors who often say the journey to riches was far more fun than the reaching the goal.
And they're patient, willing to invest in the long term and wait it out. "They stick with their investments and are more likely to have a financial plan," said Sanjiv Mirchandani, president of National Financial, a subsidiary of Fidelity Investments.
Many take the long-term approach to investing because they're working at being financial independent. When they retire, for example, many will know exactly how much they need to live on, to give away and to leave as a legacy.
"The best ones really understand how much liquidity they need to cover their expenses and make sure they have that much cash on hand," Lassiter said. "That's something the average person should do as well."
At the same time, she said most are very careful about leveraging debt. "The wealthy tend to balance between the two," she said.
Recommendations for accumulating wealth:
Live below your means: People with high incomes who spend all that money are not rich; they're just stupid.
Plan: That means plan for today, tomorrow and 30 years after retirement. Take time doing it too and spend time monitoring it every day. Use budgets and stick to them.
Diversify: As Lassiter said, look for mutual funds that allow you exposure to asset classes that aren't related to each other.
Reduce use of credit and turn to cash: It's easier, of course, for a prosperous person to pay for a house in cash than it might be for most folks, but credit-card debt for luxury purchases or extravagant vacations will never pave a road to riches.
Have access to cash: While the rich keep much of their wealth invested, they can get cash when they need it. "Have some kind of line of credit available, like a HELOC (home-equity line of credit) that you never use," Lassiter said. "It's a safety valve." She suggests a year's worth of cash to cover expenses; Danziger thinks three years worth is a better bet.
Spread cash around: When the wealthy pulled money out of the equities markets two and three years ago, they opened a bevy of bank accounts, all guaranteed up to $250,000 of deposits by the Federal Deposit Insurance Corp.
Bring your children into the mix, and remember the importance of estate planning: The affluent can go to great lengths to teach their children about money and how to manage it -- something every family should do. Though talking about money with children consistently ranks as one of the most dreaded conversations, it's important that your heirs know where all the bank accounts and safe-deposit boxes are -- even that their names are on them, too -- who the attorney is, where the will and trusts are filed.
Saturday, May 7, 2011
Save $100 a Week with These 22 Tips
Follow these 22 simple tips and save at least $100 a week:
Buy a Water Filter
Purchasing bottled water hurts not only the environment but your wallet as well. According to the Learning Channel, a family of 4 can save up to $55 a week by making the switch from bottled water to water filters.
Take Advantage of Power Strips
You can cut down on your utility bill by unplugging your appliances when you aren't using them. Make the unplugging process easy by purchasing a power strip for your appliances.
Make Shopping and To-Do Lists
Make a list of everything you need before you shop. Make sure your list only consists of needs, not wants. Then, be sure to stick to your list. You can also use to-do lists to save a ton of time. By grouping together all your errands, you can get everything done in one trip, saving you valuable minutes and gas money.
Stay Away From "Foreign" ATMs
We've all done it: using our bank card at another bank's ATM to withdraw some extra cash. But every time we do this, we get hit with a wonderful little fee. Now, there is no reason not to use ATMs owned by your bank when apps like ATM Hunter can help you find the right ATM in seconds.
Buy Generic
You can save 30 to 60 percent by purchasing generic brand food and drugs. According to a study by Consumer Reports, 80% of the time trained tasters cannot tell the difference between store and national brand food products.
Cancel Your Landline
In an age when everyone has a cell phone, landlines are not necessary. You can also utilize free computer-to-computer calling via Skype, which beats using the phone because if you have a webcam, you can see the person you are talking to.
Utilize the Library
Instead of hitting up Netflix or Blockbuster every time you want to watch a movie, head to your local library for your movie rental needs. Or, if there is a new book you want to read, borrow it from your library instead of purchasing it at the bookstore.
Bye-Bye Gym Membership
Most exercises you do at the gym can be modified and done at home. Better yet, the most beneficial exercises out there are walking, pushups, and squats, all of which you don't need a gym to do.
Take Your Lunch to Work
Instead of going to the deli down the street for lunch, brown bag your lunch. You can make a week's worth of sandwiches on your own for the price you would pay for one or two sandwiches at the deli.
Carpool
With gas prices on the upswing, filling up the tank can be a huge money drain. Organize a carpool with your coworkers to save money. If you can't find any coworkers to carpool with, check out Zimride to find a carpool buddy.
Walk or Bike
To find out how walkable your city is, check out Walk Score. Ditching your car completely will save you a ton of money not just on gas but also on wear and tear on your car.
Avoid Convenience
Wash your own car, cut your own fruits and veggies, and clean your own house. If you don't think you have enough time to wash your own car, remember that there are 24 hours in the day. Even if you spent 10 hours at work, 8 hours sleeping, 2 hours cooking, and 2 hours hanging out with the family, you would still have 2 hours to wash your car or clean your house.
Pay Bills On Time
Most banks offer free electronic bill payment services that will automatically pay your monthly bills. It only takes a few minutes to set up. Do it today and never pay a late fee again.
Make Your Own Pet Toys
Try to steer clear of Petco and Petsmart when it comes to your pet's toys. It is easy to make pet toys on your own for a fraction of the price you would pay for them at a pet store. Beautify Yourself Instead of hitting up expensive salons, try trimming your own hair or getting a value haircut from a beauty school.
Pre-Game
If you are going out for a night on the town, pre-game before you leave. This way you will spend less money on expensive drinks at your favorite hot spot. You can spend up to $5 for a beer at the bar or find a 12 pack that's on sale and pay just over $1 per beer.
Cancel Cable
With the ability to watch TV shows online for free, the need for cable is virtually nonexistent. Yes, it may be nice to see a show as soon as it airs, but it's much nicer to have extra money in your bank accounts. Try using Hulu for your TV viewing needs.
Make Your Own Food
While it may not be as convenient as going to the drive through or having food delivered to your house, making your own food can save you a ton of money.
Stay In
Sure, it may be mellower than going out, but cooking your favorite meal, making your favorite drink, and watching a DVD can be just as fun as a night on the town.
Make Your Own Coffee
This is a tried and true money saving technique that we have all heard, but it bears repeating. Make your morning cup of coffee at home instead of paying way more than you should for a cup of Joe at your favorite coffee shop.
Avoid Bank Fees
Setting up direct deposit for a certain amount can often eliminate fees associated with keeping an account open. You can avoid paying overdraft fees by linking your checking and savings accounts, or by signing up for fee e-mail alerts that tell you when your account is getting close to the limit.
Use Coupons
A tried and true money saving method: before you head to the grocery store, check the ads to see if there are any coupons for the items you need. Or, go online and check out CouponMom or The Daily Deals Blog to find the latest discounts.
Ashley Jacobs is the college correspondent for personal finance blog Wise Bread. Follow her latest tweets on @CollegeCents.
Buy a Water Filter
Purchasing bottled water hurts not only the environment but your wallet as well. According to the Learning Channel, a family of 4 can save up to $55 a week by making the switch from bottled water to water filters.
Take Advantage of Power Strips
You can cut down on your utility bill by unplugging your appliances when you aren't using them. Make the unplugging process easy by purchasing a power strip for your appliances.
Make Shopping and To-Do Lists
Make a list of everything you need before you shop. Make sure your list only consists of needs, not wants. Then, be sure to stick to your list. You can also use to-do lists to save a ton of time. By grouping together all your errands, you can get everything done in one trip, saving you valuable minutes and gas money.
Stay Away From "Foreign" ATMs
We've all done it: using our bank card at another bank's ATM to withdraw some extra cash. But every time we do this, we get hit with a wonderful little fee. Now, there is no reason not to use ATMs owned by your bank when apps like ATM Hunter can help you find the right ATM in seconds.
Buy Generic
You can save 30 to 60 percent by purchasing generic brand food and drugs. According to a study by Consumer Reports, 80% of the time trained tasters cannot tell the difference between store and national brand food products.
Cancel Your Landline
In an age when everyone has a cell phone, landlines are not necessary. You can also utilize free computer-to-computer calling via Skype, which beats using the phone because if you have a webcam, you can see the person you are talking to.
Utilize the Library
Instead of hitting up Netflix or Blockbuster every time you want to watch a movie, head to your local library for your movie rental needs. Or, if there is a new book you want to read, borrow it from your library instead of purchasing it at the bookstore.
Bye-Bye Gym Membership
Most exercises you do at the gym can be modified and done at home. Better yet, the most beneficial exercises out there are walking, pushups, and squats, all of which you don't need a gym to do.
Take Your Lunch to Work
Instead of going to the deli down the street for lunch, brown bag your lunch. You can make a week's worth of sandwiches on your own for the price you would pay for one or two sandwiches at the deli.
Carpool
With gas prices on the upswing, filling up the tank can be a huge money drain. Organize a carpool with your coworkers to save money. If you can't find any coworkers to carpool with, check out Zimride to find a carpool buddy.
Walk or Bike
To find out how walkable your city is, check out Walk Score. Ditching your car completely will save you a ton of money not just on gas but also on wear and tear on your car.
Avoid Convenience
Wash your own car, cut your own fruits and veggies, and clean your own house. If you don't think you have enough time to wash your own car, remember that there are 24 hours in the day. Even if you spent 10 hours at work, 8 hours sleeping, 2 hours cooking, and 2 hours hanging out with the family, you would still have 2 hours to wash your car or clean your house.
Pay Bills On Time
Most banks offer free electronic bill payment services that will automatically pay your monthly bills. It only takes a few minutes to set up. Do it today and never pay a late fee again.
Make Your Own Pet Toys
Try to steer clear of Petco and Petsmart when it comes to your pet's toys. It is easy to make pet toys on your own for a fraction of the price you would pay for them at a pet store. Beautify Yourself Instead of hitting up expensive salons, try trimming your own hair or getting a value haircut from a beauty school.
Pre-Game
If you are going out for a night on the town, pre-game before you leave. This way you will spend less money on expensive drinks at your favorite hot spot. You can spend up to $5 for a beer at the bar or find a 12 pack that's on sale and pay just over $1 per beer.
Cancel Cable
With the ability to watch TV shows online for free, the need for cable is virtually nonexistent. Yes, it may be nice to see a show as soon as it airs, but it's much nicer to have extra money in your bank accounts. Try using Hulu for your TV viewing needs.
Make Your Own Food
While it may not be as convenient as going to the drive through or having food delivered to your house, making your own food can save you a ton of money.
Stay In
Sure, it may be mellower than going out, but cooking your favorite meal, making your favorite drink, and watching a DVD can be just as fun as a night on the town.
Make Your Own Coffee
This is a tried and true money saving technique that we have all heard, but it bears repeating. Make your morning cup of coffee at home instead of paying way more than you should for a cup of Joe at your favorite coffee shop.
Avoid Bank Fees
Setting up direct deposit for a certain amount can often eliminate fees associated with keeping an account open. You can avoid paying overdraft fees by linking your checking and savings accounts, or by signing up for fee e-mail alerts that tell you when your account is getting close to the limit.
Use Coupons
A tried and true money saving method: before you head to the grocery store, check the ads to see if there are any coupons for the items you need. Or, go online and check out CouponMom or The Daily Deals Blog to find the latest discounts.
Ashley Jacobs is the college correspondent for personal finance blog Wise Bread. Follow her latest tweets on @CollegeCents.
Monday, May 2, 2011
16 Ways to Make Yourself Unfireable
Be the First to Arrive and the Last to Leave
Showing up to work first and leaving last shows your boss that you are dedicated to your job. Make sure to leave your office door open so your boss can see you putting in the long hours.
Cut the Company's Costs
Take a look at where your company is spending its money. Then see if there are ways to reduce those costs. Your boss won't fire someone who is improving the company's bottom line.
Make the Company More Money
Even better, figure out ways to increase revenue. Find a new client or develop new products and services for your company to sell. (See also: How to Make an Extra Income.)
Just Say No to Drama
Be sure to avoid drama whenever possible. If someone starts gossiping to you, simply excuse yourself by saying "I'm so sorry, I really have to finish this project. Maybe we can catch up later after work?" This way you can avoid the drama without being too rude to the gossiper.
Be Aware
Even though you should avoid drama, try to stay informed about what other people are saying about you. If you know what is being said about you, you can figure out how to improve your relationships with coworkers or know if you need to step it up. By being aware of how you are perceived, you can always be on top of your game.
Learn New Skills
Take advantage of any training, certification, or back-to-school programs offered by your employer. The more skills you develop the more valuable you become to your employer. If your company doesn't offer any programs, buy some new books and start training yourself.
Give Progress Reports
Make sure your boss knows how hard you are working and what you are working on by giving him or her progress reports on a weekly basis. If your boss has evidence that you are pulling your weight, he or she will be less likely to fire you.
Make Everybody Love You
Be friendly with everyone. Never say anything negative, mean, or condescending. No matter how much you hate your job, always show up with a smile on your face. (See also: How to Thrive in a Job You Hate).
Show You Are a Leader
If you are on a new project and no one seems to be taking charge, step up and be a leader. They can't fire you if you're the point person of an important ongoing project.
Show You Are a Team Player
You have to be able to work well with your coworkers. Listen to their suggestions. Adapt to each person's idiosyncrasies. Treat each coworker with respect and courtesy. If you can't be a member of a team, chances are you won't survive the next layoff.
Get Personal
Make sure your boss knows about your family by keeping pictures of them on your desk or bringing them to company parties when appropriate. Also, show an interest in your boss's family in return. Employers are less likely to fire someone they have a personal relationship with. Just be wary of over sharing. Keep personal conversations light and upbeat.
Don't Take Unfair Advantage of Sick Days
Only take a sick or personal day when you absolutely need to do so. Be honest with yourself--are you really sick or just sick of going into work? Whenever you're feeling lazy, just remember the countless unemployed people who would love to have your job.
Take on Responsibilities that No One Else Wants to Do
Chances are there are responsibilities at your company that no one wants to do because, well, they are tedious and boring. Bite the bullet and offer to take on the task that no one wants to do. Your boss (and coworkers) will love you for it.
[6 Questions to Ask Yourself Before Accepting a Job]
Positivity Goes a Long Way
By remaining positive during tough times, you can help create a more optimistic work environment. Positive people are always the last ones to get fired.
Don't Abuse Internet Privileges
It is very easy for companies to track what you do on your computer while in the office, especially online activities. Stay off of Facebook, don't check your personal emails, don't surf the web, and don't use your company email address to send personal emails.
Be the Social Chair
Who would want to fire the life of the party? Probably no one, so make yourself the social chair at your company. Come up with fun events that your coworkers actually want to participate in. You will boost company morale by making sure everyone is having a good time and make your boss think twice about handing you a pink slip.
Ashley Jacobs is the college correspondent for personal finance blog Wise Bread. Follow her latest tweets on @CollegeCents.
Showing up to work first and leaving last shows your boss that you are dedicated to your job. Make sure to leave your office door open so your boss can see you putting in the long hours.
Cut the Company's Costs
Take a look at where your company is spending its money. Then see if there are ways to reduce those costs. Your boss won't fire someone who is improving the company's bottom line.
Make the Company More Money
Even better, figure out ways to increase revenue. Find a new client or develop new products and services for your company to sell. (See also: How to Make an Extra Income.)
Just Say No to Drama
Be sure to avoid drama whenever possible. If someone starts gossiping to you, simply excuse yourself by saying "I'm so sorry, I really have to finish this project. Maybe we can catch up later after work?" This way you can avoid the drama without being too rude to the gossiper.
Be Aware
Even though you should avoid drama, try to stay informed about what other people are saying about you. If you know what is being said about you, you can figure out how to improve your relationships with coworkers or know if you need to step it up. By being aware of how you are perceived, you can always be on top of your game.
Learn New Skills
Take advantage of any training, certification, or back-to-school programs offered by your employer. The more skills you develop the more valuable you become to your employer. If your company doesn't offer any programs, buy some new books and start training yourself.
Give Progress Reports
Make sure your boss knows how hard you are working and what you are working on by giving him or her progress reports on a weekly basis. If your boss has evidence that you are pulling your weight, he or she will be less likely to fire you.
Make Everybody Love You
Be friendly with everyone. Never say anything negative, mean, or condescending. No matter how much you hate your job, always show up with a smile on your face. (See also: How to Thrive in a Job You Hate).
Show You Are a Leader
If you are on a new project and no one seems to be taking charge, step up and be a leader. They can't fire you if you're the point person of an important ongoing project.
Show You Are a Team Player
You have to be able to work well with your coworkers. Listen to their suggestions. Adapt to each person's idiosyncrasies. Treat each coworker with respect and courtesy. If you can't be a member of a team, chances are you won't survive the next layoff.
Get Personal
Make sure your boss knows about your family by keeping pictures of them on your desk or bringing them to company parties when appropriate. Also, show an interest in your boss's family in return. Employers are less likely to fire someone they have a personal relationship with. Just be wary of over sharing. Keep personal conversations light and upbeat.
Don't Take Unfair Advantage of Sick Days
Only take a sick or personal day when you absolutely need to do so. Be honest with yourself--are you really sick or just sick of going into work? Whenever you're feeling lazy, just remember the countless unemployed people who would love to have your job.
Take on Responsibilities that No One Else Wants to Do
Chances are there are responsibilities at your company that no one wants to do because, well, they are tedious and boring. Bite the bullet and offer to take on the task that no one wants to do. Your boss (and coworkers) will love you for it.
[6 Questions to Ask Yourself Before Accepting a Job]
Positivity Goes a Long Way
By remaining positive during tough times, you can help create a more optimistic work environment. Positive people are always the last ones to get fired.
Don't Abuse Internet Privileges
It is very easy for companies to track what you do on your computer while in the office, especially online activities. Stay off of Facebook, don't check your personal emails, don't surf the web, and don't use your company email address to send personal emails.
Be the Social Chair
Who would want to fire the life of the party? Probably no one, so make yourself the social chair at your company. Come up with fun events that your coworkers actually want to participate in. You will boost company morale by making sure everyone is having a good time and make your boss think twice about handing you a pink slip.
Ashley Jacobs is the college correspondent for personal finance blog Wise Bread. Follow her latest tweets on @CollegeCents.
Sunday, March 20, 2011
How to Stash $1 Million+ in Savings
Did you always have a goal to front-load your savings?
Yes. I want to retire when I am still young enough to travel, hike and body surf. It was a race for me to put a large amount away so that I could enjoy it. I knew that if I got it in early, it could grow.
You've been in practice for 14 years. Why the big push for the past eight?
During the tech bubble, I put every cent into Cisco and other tech stocks. Within two years, I had accumulated $300,000, while I was living on about $35,000 a year. I went on vacation and came back to find that my $300,000 was worth $10,000 because the bubble had burst. So I started over at age 41.
How did you make it happen?
As a resident physician, you get paid about $26,000 a year for four years. Then when you're in practice, you start making big money. My first job paid $220,000 a year, so I had all this money coming in, but I didn't feel like I needed that much. I live in a small bungalow and drive a Chrysler PT Cruiser. I decided to live on what I was making before and just pay myself a little bit more each year. It would seem like a pay raise but still allow me to put a lot away for retirement.
In at least two of the past eight years, you contributed more than $250,000 to retirement savings. How did you do that?
Until recently I worked as a navy contractor, and I was basically self-employed, so I was able to save more money in tax-deferred retirement accounts than the average employee. In addition to funding my 401(k) account, I established a traditional defined-benefit pension plan for my business, which allowed me to contribute as much as $240,000 in one year. I used any excess money to pay down my mortgage or to add to personal savings and my IRA.
How do you manage your money?
I used to keep all my money with a Merrill Lynch manager, who invested it in mutual funds. The approach was diversified, but he wasn't as aggressive as I wanted to be. Three years ago, I diversified my money managers as well, and I split the money in the defined-benefit plan in half. My guy at Merrill Lynch invests in mutual funds with half of the money, and I have a guy at Schwab who invests in stocks with the other half. It has given me peace of mind that I'm not basing my future on one person's decisions or one company's philosophy.
How did you learn to be so disciplined?
My parents were very good with money and taught my brothers and me to be responsible. At age 14, we were required to get a job and budget our money. We budgeted for clothing, college, and room and board (which went into a college account), and we kept 20%. My family instilled good financial sense in me — your salary is for day-to-day expenses, and anything to play with, you work extra for. I don't borrow, except for my mortgage, and I pay my credit cards off every month.
What is your best advice for savers?
Save first and pay yourself later. If you pay yourself first and then try to save, your standard of living will always adjust up to what you're making, and you're not going to have money left to put in savings. Figure out a goal and what you need to save for that, and then keep the rest.
Now that you've saved so much, what's next?
Although I want to have the money to retire locked up by age 50, the savings habit is so ingrained in me that I'll probably just keep saving the way I have been and look at retiring early and getting out of the rat race. I plan on having a second career in retirement, something to get up to do every day, but without the responsibilities of being a physician. I'd be happy living a more comfortable lifestyle, although not a rich one. Still, I've always said that when I turn 50, I'll buy a doctor's car — a BMW or a Mercedes.
Copyrighted, Kiplinger Washington Editors, Inc.
Yes. I want to retire when I am still young enough to travel, hike and body surf. It was a race for me to put a large amount away so that I could enjoy it. I knew that if I got it in early, it could grow.
You've been in practice for 14 years. Why the big push for the past eight?
During the tech bubble, I put every cent into Cisco and other tech stocks. Within two years, I had accumulated $300,000, while I was living on about $35,000 a year. I went on vacation and came back to find that my $300,000 was worth $10,000 because the bubble had burst. So I started over at age 41.
How did you make it happen?
As a resident physician, you get paid about $26,000 a year for four years. Then when you're in practice, you start making big money. My first job paid $220,000 a year, so I had all this money coming in, but I didn't feel like I needed that much. I live in a small bungalow and drive a Chrysler PT Cruiser. I decided to live on what I was making before and just pay myself a little bit more each year. It would seem like a pay raise but still allow me to put a lot away for retirement.
In at least two of the past eight years, you contributed more than $250,000 to retirement savings. How did you do that?
Until recently I worked as a navy contractor, and I was basically self-employed, so I was able to save more money in tax-deferred retirement accounts than the average employee. In addition to funding my 401(k) account, I established a traditional defined-benefit pension plan for my business, which allowed me to contribute as much as $240,000 in one year. I used any excess money to pay down my mortgage or to add to personal savings and my IRA.
How do you manage your money?
I used to keep all my money with a Merrill Lynch manager, who invested it in mutual funds. The approach was diversified, but he wasn't as aggressive as I wanted to be. Three years ago, I diversified my money managers as well, and I split the money in the defined-benefit plan in half. My guy at Merrill Lynch invests in mutual funds with half of the money, and I have a guy at Schwab who invests in stocks with the other half. It has given me peace of mind that I'm not basing my future on one person's decisions or one company's philosophy.
How did you learn to be so disciplined?
My parents were very good with money and taught my brothers and me to be responsible. At age 14, we were required to get a job and budget our money. We budgeted for clothing, college, and room and board (which went into a college account), and we kept 20%. My family instilled good financial sense in me — your salary is for day-to-day expenses, and anything to play with, you work extra for. I don't borrow, except for my mortgage, and I pay my credit cards off every month.
What is your best advice for savers?
Save first and pay yourself later. If you pay yourself first and then try to save, your standard of living will always adjust up to what you're making, and you're not going to have money left to put in savings. Figure out a goal and what you need to save for that, and then keep the rest.
Now that you've saved so much, what's next?
Although I want to have the money to retire locked up by age 50, the savings habit is so ingrained in me that I'll probably just keep saving the way I have been and look at retiring early and getting out of the rat race. I plan on having a second career in retirement, something to get up to do every day, but without the responsibilities of being a physician. I'd be happy living a more comfortable lifestyle, although not a rich one. Still, I've always said that when I turn 50, I'll buy a doctor's car — a BMW or a Mercedes.
Copyrighted, Kiplinger Washington Editors, Inc.
Thursday, October 21, 2010
How to Be a Millionaire by Age 25
From the Yahoo News. Here is an advice from people who made their first million before their age of 25
Michael Dell
Age now: 45
Title/Company: Founder and CEO, Dell Computers
Made his first million by age: 19
His advice for young entrepreneurs: "You've got to be passionate about it," he said in an interview with the Academy of Achievement.
"I think people that look for great ideas to make money aren't nearly as successful as those who say, 'Okay, what do I really love to do? What am I excited about?' "
Catherine Cook
Age now: 20
Title/Company: Founder, myyearbook.com
Made her first million by age: 18
Her advice for young entrepreneurs: "Stop just thinking about it, and make it happen.
When you're young is the best time to start your own business, as you do not have the responsibilities you will have when you're older. The worst that can happen if you fail now is that you have firsthand experience to make your next venture a success."
Sean Belnick
Age now: 23
Title/Company: Founder, BizChair.com
Made his first million by age: 16
His advice for young entrepreneurs: "It is never too early to start. I started when I was 14.There was a lot of great information on the Internet. Just do the research and find a way to do what you want to do."
Juliette Brindak
ge now: 21
Title/Company: Cofounder/CEO, MissOandFriends.com
Made her first million by age: 19 (Brindak won't divulge when she earned her first million, but says that her company was valued at $15 million when she was 19)
Her advice for young entrepreneurs:: Find a solid support team who believe in your idea. "If someone starts to doubt your company and what you're doing, you need to get rid of them."
Matt Mickiewicz
Age now: 27
Title/Companies: Founder, Sitepoint, 99 Designs and Flippa
Made his first million by age: 22
His advice for young entrepreneurs: "People who say it takes money to make money are using the worst excuse ever. . . Create massive value for others by providing a solution where no other exists."
Michael Dell
Age now: 45
Title/Company: Founder and CEO, Dell Computers
Made his first million by age: 19
His advice for young entrepreneurs: "You've got to be passionate about it," he said in an interview with the Academy of Achievement.
"I think people that look for great ideas to make money aren't nearly as successful as those who say, 'Okay, what do I really love to do? What am I excited about?' "
Catherine Cook
Age now: 20
Title/Company: Founder, myyearbook.com
Made her first million by age: 18
Her advice for young entrepreneurs: "Stop just thinking about it, and make it happen.
When you're young is the best time to start your own business, as you do not have the responsibilities you will have when you're older. The worst that can happen if you fail now is that you have firsthand experience to make your next venture a success."
Sean Belnick
Age now: 23
Title/Company: Founder, BizChair.com
Made his first million by age: 16
His advice for young entrepreneurs: "It is never too early to start. I started when I was 14.There was a lot of great information on the Internet. Just do the research and find a way to do what you want to do."
Juliette Brindak
ge now: 21
Title/Company: Cofounder/CEO, MissOandFriends.com
Made her first million by age: 19 (Brindak won't divulge when she earned her first million, but says that her company was valued at $15 million when she was 19)
Her advice for young entrepreneurs:: Find a solid support team who believe in your idea. "If someone starts to doubt your company and what you're doing, you need to get rid of them."
Matt Mickiewicz
Age now: 27
Title/Companies: Founder, Sitepoint, 99 Designs and Flippa
Made his first million by age: 22
His advice for young entrepreneurs: "People who say it takes money to make money are using the worst excuse ever. . . Create massive value for others by providing a solution where no other exists."
Monday, August 9, 2010
Climb
When you try to Climb to the top, you will meet the people who give you a hand and also you will meet the people who push you down. When you meet the people that who push you down, all you need to do is just to avoid them. because they love the place where they are and they don't want you to take their place. Other hand they also admit that they don't want to go further up to reach to the top. You both has different goal. Just ignore them and keep on climbing....
Tuesday, June 1, 2010
How to Relest the Unwanted Stress
Here is a topic that is talked about by many, but is treated as being highly under-rated, usually ignored and sneered at by non-believers. Most people do not like to admit to defeat and will continuously push themselves to their limit. In hindsight they presume themselves to be emotionally, mentally and physically strong enough to endure any challenge or to overcome any obstacle or hardship thrown in their path. And yes, we have been blessed with superb physiology that confronts and deals with most difficulties. Unfortunately, in these modern times, with our fast-paced lifestyles and high expectations, we can become overburdened with insurmountable amounts of pressure.
Stress is rearing its ugly head in many different ways. There are a multitude of factors that can promote stressors, such as job insecurity or job dis-satisfaction, moving residence, death of a loved one, starting a new job or position, losing a job, first day at school, public speaking, writing an exam, pregnancy, peer pressure, keeping up to the Jones, doing or learning something beyond your comfort level or even something as simple as going to the dentist. When you find yourself in a predicament that is uncomfortable, you will usually feel a knot rising in your stomach. How it affects your body is actually much more complex and if ignored over a prolonged period of time, it can lead to serious health issues.
When stressors are present, they activate your nervous system. Your hypothalamus, which maintains your body's autonomic nervous system (or bodily functions that operate without your awareness) starts signalling your adrenal glands to produce more adrenaline and cortisol and releases these hormones into your bloodstream. Because of the influx in hormones, your heart rate, breathing rate, blood pressure and metabolism all speed up. At the same time, your blood vessels open wider allowing more blood flow to large muscle groups, which puts your muscles on alert. You experience increased stomach acid, increased cholesterol and as well, your pupils dilate to improve vision, your liver increases your body's energy by releasing stored sugar and more sweat is produced to cool your body.
These physical changes prepare you to react quickly and effectively in order to handle the pressure at that moment in time and normally your body can perform well while under pressure, but if stressors create over-reaction or if your body fails to return to its natural status quo, then this can lead to further complications. Unfortunately too much of a good thing can become disastrous. If you are overloaded with stress over an extended period of time you may feel dis-oriented, overwhelmed, flighty, scattered or unbalanced. Or even worse, it can weaken your immune system, overwork your internal organs, deplete your energy and lead to chronic illness or disease.
Stress can be indicated by many types and stages of warning signs. In the early stages, warning signs may show as insomnia or sleep disturbance, boredom, crying spells, arguing, decreased appetite, constipation or diarrhea, lack of sex drive, mild depression, procrastination, increased colds/flu, headaches, dis-interest in hobbies or sports once enjoyed, rigidity and inflexible thinking or behaviour, fatigue, marital, work or relationship discord and ulcers. If left undetected or ignored until later stages, then stress will create further damage which may show as asthma, heart conditions, severe depression, migraines, muscle or joint pain/stiffness, change of marital status, change of job, complete withdrawal from social or enjoyable events, forgetfulness, suicidal tendencies, uncontrolled rage or temperament, chronic fatigue syndrome, loss of self-esteem, lack of self-confidence, accident prone, overly agitated or an inability to maintain personal daily life.
If you suspect that you are suffering from the warning signs of stress, it is best to see your medical physician for further examination, analysis and treatment. But also be aware that overcoming the adverse effects of stress is not necessarily healed by popping medications. You will have a much better chance to restore healthy balance, mind-body-spirit, by combining your medical treatment plan to coincide with changes in your attitude, thinking and lifestyle patterns.
To release unwanted stress, the solution is to learn how to keep stress managed to your comfort level or better still, try to avoid it as much as possible. Stress-management is about learning how to welcome and deal with daily challenges, whether regarded as good or bad and to do this regularly, not just when you are in the pressure cooker mode. If you learn how to de-stress and simply keep yourself in a calm frame of mind, this can help you move through challenging circumstances. Here are different ways to help you keep stress under control.
1. Ask for help: Be aware that you cannot, nor are you expected to, know and do everything. Accept the fact that each person has limits and sometimes we need to help each other.
2. Avoid over-scheduling: Only be involved or do activities that are of interest and most important to you.
3. Avoid perfectionism: Be realistic, accept and realize that nobody is perfect, so don't expect you or others to be perfect.
4. Be Resilient. Try to go with the flow and resist trying to over-control a situation, person or circumstances. When you remain calm and cool under pressure you are better able to handle problems as they arise, because you maintain clearer focus. But building your resilience takes practice and patience by developing a positive attitude and behaviour in these different areas, so remember to....
1. Welcome change as a challenge and allow it to be part of your normal life
2. View obstacles or setbacks as a being temporary and believe that all will be solved for the highest good for all concerned
3. As each problem or roadblock arises, take the time to be pro-active in solving the dilemma in a peaceful manner
4. Surround yourself with strong, loving, positive-thinking, supportive friends and family
5. Ask your supportive friends and family for help when needed, but avoid becoming co-dependent
6. Enjoy yourself, have fun, relax, remain humble and always show gratitude
5. Break down your problems: Instead of becoming overwhelmed by trying to solve a huge problem all at once, learn to break it into smaller segments or categories, so that you feel a sense of control. Then calmly look at each category one by one, evaluate your options, list pros and cons, look at the bigger picture to assess how it affects your future before arriving at a conclusion. By learning this strategy you will build inner confidence and this in turn will reduce unnecessary stress. Avoid ignoring the problem altogether, because ignorance is not bliss and the problem won't magically disappear. Instead, it will remain unsolved, which will only add to your plate of stress and increase your lack of control.
6. Exercise: Maintain a daily exercise routine to strengthen your muscles and cardio-vascular system. Exercise also stimulates your lymphatic system to releases waste/toxins from your body, increases blood flow to your brain and circulates energy throughout your entire system.
7. Honour your body: Avoid abusing your body through excess use of drugs, alcohol, over-eating, smoking or over-indulgence of junk foods.
8. Maintain proper sleep: This keeps you better equipped, mentally and physically, by providing increased clarity and focus when dealing with stressors. If necessary, rejuvenate by taking short ten or fifteen minute power naps during the day.
9. Monitor your thinking: All thoughts are energy, all action follows a thought; therefore, you control your reality in which your outlook, attitude and re-actions influence your life. Energy attracts the same frequency vibration, so what you think, you will get or attract; therefore, be very careful what you think or wish for.
10. Nutrition: Eat a balanced variety of nutritious foods, drink eight, eight-ounce glasses of water, reduce fats and sugar and supplement with additional vitamins and minerals.
11. Relax: This creates calmness and a sense of well-being. So the next time you feel yourself tense up, breathe slowly, deeply and evenly until you feel calmer. Your body's chemical imbalances can be reversed or greatly improved simply by relaxing. You can learn to relax through doing such activities such as: walking, simple 1-2-3-4 breathing exercises, meditation, visualizations, music, reading, painting, enjoyable hobbies, a relaxing bath, massage, Reiki, reflexology; the list goes on. It is important to find what works for you.
An important key for releasing unwanted stress and increasing your over-all success, is to regard each challenge as a golden opportunity for spiritual growth and a means to learn valuable lessons. Then regard stressors as just temporary problems or hiccups. You cannot eliminate stress altogether, otherwise you would have no motivation to do anything worthwhile or constructive; therefore you would experience no personal growth. But moderate amounts of good stress will induce you to make sensible, achievable goals, monitor your growth progress, allow yourself time for relaxation and enjoyment, remain optimistic, believe in your capabilities, plus make positive choices to live your life to its fullest potential.
One final word of advice.... refuse to allow stress to control or dominate you; instead, make the effort to learn how to control and tame it.
About the Author
This article was written by Margaret Jang, who has been channelling inspirational guidance/teachings from Spirit, in poetry format since 2002. Margaret is a healing facilitator for Reiki & gemstone therapy and is also an instructor offering courses and workshops for Reiki, gemstone healing & psychic/soul development. She resides in Vancouver, BC and may be contacted at www.onesourcelearn.com or phone 604-879-7201.
Stress is rearing its ugly head in many different ways. There are a multitude of factors that can promote stressors, such as job insecurity or job dis-satisfaction, moving residence, death of a loved one, starting a new job or position, losing a job, first day at school, public speaking, writing an exam, pregnancy, peer pressure, keeping up to the Jones, doing or learning something beyond your comfort level or even something as simple as going to the dentist. When you find yourself in a predicament that is uncomfortable, you will usually feel a knot rising in your stomach. How it affects your body is actually much more complex and if ignored over a prolonged period of time, it can lead to serious health issues.
When stressors are present, they activate your nervous system. Your hypothalamus, which maintains your body's autonomic nervous system (or bodily functions that operate without your awareness) starts signalling your adrenal glands to produce more adrenaline and cortisol and releases these hormones into your bloodstream. Because of the influx in hormones, your heart rate, breathing rate, blood pressure and metabolism all speed up. At the same time, your blood vessels open wider allowing more blood flow to large muscle groups, which puts your muscles on alert. You experience increased stomach acid, increased cholesterol and as well, your pupils dilate to improve vision, your liver increases your body's energy by releasing stored sugar and more sweat is produced to cool your body.
These physical changes prepare you to react quickly and effectively in order to handle the pressure at that moment in time and normally your body can perform well while under pressure, but if stressors create over-reaction or if your body fails to return to its natural status quo, then this can lead to further complications. Unfortunately too much of a good thing can become disastrous. If you are overloaded with stress over an extended period of time you may feel dis-oriented, overwhelmed, flighty, scattered or unbalanced. Or even worse, it can weaken your immune system, overwork your internal organs, deplete your energy and lead to chronic illness or disease.
Stress can be indicated by many types and stages of warning signs. In the early stages, warning signs may show as insomnia or sleep disturbance, boredom, crying spells, arguing, decreased appetite, constipation or diarrhea, lack of sex drive, mild depression, procrastination, increased colds/flu, headaches, dis-interest in hobbies or sports once enjoyed, rigidity and inflexible thinking or behaviour, fatigue, marital, work or relationship discord and ulcers. If left undetected or ignored until later stages, then stress will create further damage which may show as asthma, heart conditions, severe depression, migraines, muscle or joint pain/stiffness, change of marital status, change of job, complete withdrawal from social or enjoyable events, forgetfulness, suicidal tendencies, uncontrolled rage or temperament, chronic fatigue syndrome, loss of self-esteem, lack of self-confidence, accident prone, overly agitated or an inability to maintain personal daily life.
If you suspect that you are suffering from the warning signs of stress, it is best to see your medical physician for further examination, analysis and treatment. But also be aware that overcoming the adverse effects of stress is not necessarily healed by popping medications. You will have a much better chance to restore healthy balance, mind-body-spirit, by combining your medical treatment plan to coincide with changes in your attitude, thinking and lifestyle patterns.
To release unwanted stress, the solution is to learn how to keep stress managed to your comfort level or better still, try to avoid it as much as possible. Stress-management is about learning how to welcome and deal with daily challenges, whether regarded as good or bad and to do this regularly, not just when you are in the pressure cooker mode. If you learn how to de-stress and simply keep yourself in a calm frame of mind, this can help you move through challenging circumstances. Here are different ways to help you keep stress under control.
1. Ask for help: Be aware that you cannot, nor are you expected to, know and do everything. Accept the fact that each person has limits and sometimes we need to help each other.
2. Avoid over-scheduling: Only be involved or do activities that are of interest and most important to you.
3. Avoid perfectionism: Be realistic, accept and realize that nobody is perfect, so don't expect you or others to be perfect.
4. Be Resilient. Try to go with the flow and resist trying to over-control a situation, person or circumstances. When you remain calm and cool under pressure you are better able to handle problems as they arise, because you maintain clearer focus. But building your resilience takes practice and patience by developing a positive attitude and behaviour in these different areas, so remember to....
1. Welcome change as a challenge and allow it to be part of your normal life
2. View obstacles or setbacks as a being temporary and believe that all will be solved for the highest good for all concerned
3. As each problem or roadblock arises, take the time to be pro-active in solving the dilemma in a peaceful manner
4. Surround yourself with strong, loving, positive-thinking, supportive friends and family
5. Ask your supportive friends and family for help when needed, but avoid becoming co-dependent
6. Enjoy yourself, have fun, relax, remain humble and always show gratitude
5. Break down your problems: Instead of becoming overwhelmed by trying to solve a huge problem all at once, learn to break it into smaller segments or categories, so that you feel a sense of control. Then calmly look at each category one by one, evaluate your options, list pros and cons, look at the bigger picture to assess how it affects your future before arriving at a conclusion. By learning this strategy you will build inner confidence and this in turn will reduce unnecessary stress. Avoid ignoring the problem altogether, because ignorance is not bliss and the problem won't magically disappear. Instead, it will remain unsolved, which will only add to your plate of stress and increase your lack of control.
6. Exercise: Maintain a daily exercise routine to strengthen your muscles and cardio-vascular system. Exercise also stimulates your lymphatic system to releases waste/toxins from your body, increases blood flow to your brain and circulates energy throughout your entire system.
7. Honour your body: Avoid abusing your body through excess use of drugs, alcohol, over-eating, smoking or over-indulgence of junk foods.
8. Maintain proper sleep: This keeps you better equipped, mentally and physically, by providing increased clarity and focus when dealing with stressors. If necessary, rejuvenate by taking short ten or fifteen minute power naps during the day.
9. Monitor your thinking: All thoughts are energy, all action follows a thought; therefore, you control your reality in which your outlook, attitude and re-actions influence your life. Energy attracts the same frequency vibration, so what you think, you will get or attract; therefore, be very careful what you think or wish for.
10. Nutrition: Eat a balanced variety of nutritious foods, drink eight, eight-ounce glasses of water, reduce fats and sugar and supplement with additional vitamins and minerals.
11. Relax: This creates calmness and a sense of well-being. So the next time you feel yourself tense up, breathe slowly, deeply and evenly until you feel calmer. Your body's chemical imbalances can be reversed or greatly improved simply by relaxing. You can learn to relax through doing such activities such as: walking, simple 1-2-3-4 breathing exercises, meditation, visualizations, music, reading, painting, enjoyable hobbies, a relaxing bath, massage, Reiki, reflexology; the list goes on. It is important to find what works for you.
An important key for releasing unwanted stress and increasing your over-all success, is to regard each challenge as a golden opportunity for spiritual growth and a means to learn valuable lessons. Then regard stressors as just temporary problems or hiccups. You cannot eliminate stress altogether, otherwise you would have no motivation to do anything worthwhile or constructive; therefore you would experience no personal growth. But moderate amounts of good stress will induce you to make sensible, achievable goals, monitor your growth progress, allow yourself time for relaxation and enjoyment, remain optimistic, believe in your capabilities, plus make positive choices to live your life to its fullest potential.
One final word of advice.... refuse to allow stress to control or dominate you; instead, make the effort to learn how to control and tame it.
About the Author
This article was written by Margaret Jang, who has been channelling inspirational guidance/teachings from Spirit, in poetry format since 2002. Margaret is a healing facilitator for Reiki & gemstone therapy and is also an instructor offering courses and workshops for Reiki, gemstone healing & psychic/soul development. She resides in Vancouver, BC and may be contacted at www.onesourcelearn.com or phone 604-879-7201.
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