Diversify your Portfolio (Financial Pillar #9)

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Check out the complete list of Financial Pillars Here   During the market crash in 2008, I kinda-sorta misplaced $20,000 worth of mutual funds. This represented 66% of my total funds invested in the market at that time.   That was a gut-punch.   Do you know what was worse?   When I lost 66% of my invested money, I also lost 66% of my net worth.   That was a kick in the groin… Followed by a gut-punch and a smack in the face. Then The Rock came by to give me the People’s Elbow… And when I got back up, Chuck Norris stopped by to roundhouse kick me in the face.     Yeah… It was like that…   After dusting myself off and eventually standing back up, I vowed to never let one attack take me down again.   I vowed to diversify my portfolio   Let’s […]

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Negotiate EVERYTHING – from a position of strength (financial pillar #8)


Check out the complete list of Financial Pillars Here   I’ve come to find (through experience and research) that whether you’re trying to pay, earn, save, or break even, many things in life are negotiable.   “Negotiate” – 1) Obtain or bring about by discussion, or – 2) Find a way over or through (an obstacle or difficult path).   The word ‘negotiate’ used to feel sleazy to me. It just didn’t sit right in my mind. I would hear negotiate and think that someone was trying to get over on someone else. Pull a fast one. Or to strong-arm someone into getting them to do something they didn’t want to.   It’s true that some may have this mindset and take this approach to use negotiation as a ploy to get what they want, but from my recent experiences and from learning from and reading some works by the most successful people […]

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Work with knowledgeable professionals (financial pillar #7)


Check out the complete list of Financial Pillars Here   Although I don’t typically struggle with self-confidence, I’ll readily admit to the following facts: I am not a licensed investment banker, insurance salesman, accountant, loan officer, doctor, lawyer, or personal trainer. I would probably argue that I could do a portion of some of the jobs above, but if you had any sense about you that argument wouldn’t last too long. And while there are many things I’m pretty good at, I wouldn’t consider myself an expert in more than a couple of fields.   Why, then, would I assume that I am the best person to handle those jobs for my family – all on my own? I can’t possibly know enough about the case law, current accounting practices, most worthwhile insurances, and hottest investment funds that would put our family in the best position possible to succeed. Taking it […]

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Pay yourself first (financial pillar#6)


Check out the complete list of Financial Pillars Here When there are credit card payments, student loan payments, rent, mortgage, car payments, utilities, groceries, …, and the good ‘ole gym membership competing for those precious budget dollars, it can be so easy to ignore savings. In this post, I’ll show you why it’s vital to save monthly. How will we do this? By paying ourselves first. That’s right – before all of those other bills. Don’t worry, if we do this right your lights won’t get shut off on you.   I’ve heard it when doing financial counseling, my friends have said it in random conversations, and the data show their comments to be true… “After all of the fixed expenses, it’s hard to come up with any money to save each month.”   I hear this and think about death to the savings account, death to retirement, and death to financial freedom itself. And I’m […]

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Learn to live below your means (financial pillar #5)


Check out the complete list of Financial Pillars Here   Learning to live below your means is not simply making a budget and sticking to it   Living below your means is a change in mindset. It’s practicing financial discipline – it’s an ethos. A foundation that will provide you freedom in the rest of your life. Freedom to choose, to vacation, to live the life you desire. But more than that, the practice of living below your means will show you that happiness doesn’t come with material possessions. Happiness and fulfillment come in the journey. And it’s this journey of being financially disciplined that will allow all of our following financial pillars to exist.   You want the nuts and bolts? Find out what your fixed expenses are, what your income is, and then save more than you spend. Many articles will try to dress these points up and […]

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Eliminate ‘bad debt’ (financial pillar #4)


Check out the complete list of Financial Pillars Here   Excessive use, or misuse, of debt is 1 of the top 5 reasons people go bankrupt. Bad debt can also be the harsh instrument by which your paycheck’s take-home, for example, goes from $1,200 to $500 (car payment, credit card balance, a monthly payment on furniture, …). The #1 way to fix your problems with bad debt is to NEVER, under any circumstances, let it into your life.   For some of us, unfortunately, bad debt is already in and roaming around our homes, apartments, and vehicles. What we’ll do here then, is this:   -Review how to distinguish bad debt from good (yes, there is such a thing), -Evaluate ways to eliminate any bad debt already accumulated, and -Make certain we have a plan in place to keep bad debt out of our lives for good.   What separates bad […]

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Sit down and make a budget (financial pillar #3)

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Check out the complete list of Financial Pillars Here   If you have tried to save money, spend less, improve credit, or build wealth at some point in the past, chances are you’ve heard that making a budget is a huge step in achieving your goal. If you’re anything like the previous version of me (I’ll call him splurgy Mike), then chances are you read the words about making a budget, they proceeded through your eyes, reached your brain, and were immediately disregarded. “I’ll just watch my spending and the money will save itself up eventually. I don’t need a budget…”   Flat. Out. Wrong.   Does a surgeon cut into someone’s chest and think, “A little patch here, stint there, maybe some stitching in this region, then this heart should basically heal itself?” No. They have a detailed plan. A football coach makes a game plan each week (topical […]

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Protect your income (financial pillar #2)

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Check out the complete list of Financial Pillars Here   Now that you’re doing what you love and earning an income, things should be looking up. Having an income allows us to pay bills, save for retirement, save for a rainy day, and take trips for vacation! Who doesn’t love vacation?   All this sounds well and good while the income is rolling in but what happens if it stops? What if you’re all of a sudden unable to work because of an illness? Now, paying what happens when it’s not just you counting on that income? What if you are your family’s breadwinner and something happens to you?   Unless you’re well prepared, only bad things would happen – very bad things. Bills pile up, credit scores plummet, houses get foreclosed on, savings are quickly eliminated… Not good.   How can we make sure that we’re protected in the unfortunate […]

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Do what you love (financial pillar #1)

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Check out the complete list of Financial Pillars Here   Do what you love…   It may not start out this way. You may do what’s necessary to get your income rolling in a positive direction but eventually, wouldn’t the ideal goal be to do what you love rather than to do what you have to – just to get by?   I believe that happiness in life rests in the freedom to do the things that bring you the most joy, professionally and otherwise. This could be spending time with family, hiking, working for yourself, painting, writing, or any number of activities that you enjoy. Some view this as their retirement goal… Work all of your life eyeing up the last 20 or so years. Man, retirement will be so sweet, but the first 65 will be… a bear. That’s no way to live.   There have been scores of […]

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We Had a Huge Financial Crisis, Now What?

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  The 2007-‘09 housing market collapse sent our economy into a tail-spin. People lost jobs, companies went out of business, and many nest eggs got cracked. CNN reported that from 2007-’09 American households lost a net of $16.40 Trillion (With a ’T’), or an average of 25% of a family’s net worth.   The effects were terrible and wide-reaching. Although the stock market did make a more-than-full recovery within the next few years, many were still left behind. People were unemployed, under-employed, or just terrified to invest again. So, although the economy was ‘recovering,’ many individuals didn’t (and still don’t) see or feel those improvements.   Personally, by mid-2007 we had saved close to $30,000 for a down payment on our house. In ’09 that got cut to about $15,000. We were young and invested aggressively so the crash hit us HARD (50% hard…).   After gradually dipping a toe at-a-time […]

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