This blog is intended for educational purposes only. None of these posts are meant to give legal or financial advice. If you need advice you should consult an appropriate professional.

Monday, January 30, 2012

status is dumb

Wanting others to know we've made it in this world is a powerful drive for many people.  It's silly really.  If we really thought about our decisions I bet many of them would be about impressing others in some way.  I live in a fairly high status neighborhood.  But I'm a stow away in my cute little garage apartment.  I wonder how many of the families living in those houses have real wealth though.  My guess is it's not many.  They're probably on the earn to spend treadmill.  And that's not a good place to be.  What's better to do is not care what others think of us in this world and build real wealth.  Is this easy to do?  Absolutely not!  We all want to be accepted by our fellow human creatures.  So expensive houses and cars really don't get you anywhere unless you're already rich.  Even then why not live modestly.  Status also extends to where people shop.  You can usually notice a certain type of clientele that's similar to each other when you walk into a place.  Yeah this a yuppie store or this is a hippie store.  That type of thing.  Always try to get the best value or some kind of deal for your hard won dollars no matter the level of the store on the status totem pole.  It doesn't seem like people talk about status much either, but it's very real.  I notice it all the time.  Some businesses sell steak, and some sell sizzle.  Give me the steak any day baby!  So fight this culture a little bit, and don't go along with this dumb status game.  Build real wealth, and enjoy your life.

Thursday, January 26, 2012

financial independence

Financial independence is a term that's used a lot today.  What does it mean?  I define it as having a source of income other than paid employment that covers ALL of your living expenses.  This is possible to achieve in a capitalist system.  Is it easy?  It most certainly is not.  I think most of us are taught to get jobs then spend all or more of our earnings on consumption items.  This is not the way to build wealth.  It's inevitable that we'll all reach a point where we're no longer able or don't want to work anymore.  Why not plan for it now?  So building capital of some kind comes to the front of the line if you want to be free from the grind.  The foundation to all this is to keep expenses lower than income always so your surplus is free to be employed to produce freedom.  Remember a consumption spending based lifestyle is a treadmill.  I'd rather jog outside.  Remember appearances can be deceiving.  The person with all the flashy stuff often has little real wealth, and they often are deeply in debt.  If you have a source of income today then it's possible for you to get on the path towards financial independence.  Start small.  Aim to pay a little bill with some sort of recurring income then repeat.  That's really all there is to it.  Enjoy the process.  Always think about ways to make an income that doesn't depend on you being in a particular location or showing up and trading hours for dollars.  Even if you never pull it off it's fun to dream.  You are only truly financially independent when you don't have to work for survival anymore.  Until then enjoy yourself.