Personal Economics 101

The Richest Man in Babylon  is an absolute gem of a book that imparts timeless financial wisdom in a captivating and relatable manner. George S. Clason's storytelling takes you on a journey to the ancient city of Babylon, where simple yet profound financial principles come to life. This book is a masterpiece in teaching the art of managing money, showcasing principles like saving a portion of your income, investing wisely, and living within your means. Through relatable parables and anecdotes, Clason delivers valuable lessons that remain as relevant today as they were when the book was written. What sets this book apart is its ability to simplify complex financial concepts. The storytelling format makes it engaging and easy to understand, even for those who are new to financial literacy. As you follow the characters' journeys to financial success, you'll find yourself not only entertained but also inspired to apply the lessons to your own life. "The Richest Man in Baby...

 I got this question on Quora today. It's a common question. The answer I provided is below.  I got into debt young as I didn’t realize how important it was to have a good credit score. How can I get myself out of this mess? I’m worried it’s going to affect future relationships. You really must to want to be debt-free. There is no other way. It’s a process, of both knowledge of personal finance, and modifying your financial behavior. But it is something you can achieve, if you create a plan and follow the steps of sound financial planning. I’m going to tell you up front that it will take quit a bit of work and effort on your part, depending on how much debt you have, and what you are willing to do. We had a saying in the military about what needed to be done do accomplish our mission: “Whatever is necessary.” This will be the same kind of thing. So you have to develop the same mindset. Be hungry. Personal finance is 20 percent knowledge, and 80 percent behavior. When I starte...

This is a question I get asked a lot on Quora. "What are the best ways to get out of debt?" Here's my most recent answer: You really must to want to be debt-free. There is no other way. It’s a process, of both knowledge of personal finance, and modifying your financial behavior. But it is something you can achieve, if you create a plan and follow the steps of sound financial planning. I’m going to tell you up front that it will take quit a bit of work and effort on your part, depending on how much debt you have, and what you are willing to do. We had a saying in the military about what needed to be done do accomplish our mission: “Whatever is necessary.” This will be the same kind of thing. So you have to develop the same mindset. Be hungry. Personal finance is 20 percent knowledge, and 80 percent behavior. When I started I had more than $50,000 in credit card debt, had two mortgages (one on a rental house that was actually costing me more than I made in rents), and a cou...

I too once lived paycheck to paycheck. It's a hard way to live, at least financially. But I got out. Here are some suggestions on how you can too.  Living paycheck to paycheck isn't uncommon these days. Recent studies suggest many Americans are doing just that, which in turn makes it next to impossible to save and invest. Overspending can be part of the problem, but even more often people get squeezed through no fault of their own—low wages, unpredictable income and high costs for essentials like childcare, healthcare, housing and college. On the other hand, even people with high incomes can find themselves caught in a seemingly never-ending cycle. When you’re in this situation and just barely making ends meet each month, it can seem as though you’re on an endless financial treadmill. So how do you jump off? It's a combination of attitude and action. First realize that you can do it—then take these steps to make it happen. Budgets are key Start by tracking your spending wit...

 You are a product of your environment. You are a product of who you hang out with. And how to deal with people you can't cut off. https://youtu.be/d3uAaz1jaDg

Key insights from Happiness is a Choice You Make: Lessons from a Year Among the Oldest Old By John Leland What you'll learn This book began as a series of in-depth interviews that New York Times reporter John Leland conducted called "85 and Up." The book's title is...

Don’t over-leverage the property. Borrowing money to purchase and improve a property is a good strategy. Just don’t overdo it. Two things happen when you over leverage a property. You may not have adequate financial reserves to take care of any unexpected problems that come along. Also, it costs money to borrow money. It will eat into your profit. Today’s low-interest rates are tempting but do the math first. If the interest rate is likely to go up later (balloon payment or adjustable mortgage), run the numbers for the worst-case scenario before committing to the loan. Be conservative in your cost estimates and schedule. It almost always costs more and takes longer than you think it will to make repairs or remodel a house. Especially if you don’t have a lot of experience with real estate or a particular type of deal. Be conservative when estimating costs and schedules and then add another 20% to both. The bright spot here is that when you come in under budget and ahead of schedule, th...

I moved #10 to #1, because it is actually the most important. 1. You need a written budget and a written plan for your money 2. Spend less than you earn 3. Create an emergency fund immediately 4. There is no tomorrow; start today 5. It's purely on your shoulders 6. The "Joneses" are living a lie 7. Pay off your debt 8. Create multiple sources of income 9. Personal finance is 20% knowledge and 80% behavior 10. Income does not determine your wealth

https://youtu.be/UFX09wke9BI

Spoiler alert: Savings rate.  https://youtu.be/Y0cibIa1N38

I slept and dreamed that life was beauty. I woke and found that life was duty. 

It's important to fully screen information you may be getting from various media sources. Some, like MSNBC and CNN are sensationalizing this crisis in order to get you in a fearful state and go against the Trump administration, which the hate. And hate is the right word. Chuck Todd, Chris Hayes, Rachel Maddow come immediately to mind. Avoid these people. If you must, ad the end of this article, I've included a few articles if you are a glutton for punishment. These people are nuts. So having said that, more rational minds are needed, and many are available. How you weather this storm is up to you, but I've assembled some articles that may be of help. Weathering The Storm: Coronavirus And Its Financial Impact On Homeowners One way or another, future historians will consider the Coronavirus Pandemic among the most noteworthy events of the early 21st Century. Schools and businesses are shut down, and, throughout the country, Americans have been directed to “she...

I challenge anyone reading this to spend two hours with this video of Jim Rohn. It's a classic. You'll be glad you did.

It takes time and discipline to become money smart. It doesn't happen overnight. Some people go through life never saving and living paycheck to paycheck. Learning how to be able to handle your money at an early age may not seem sexy, but it will certainly put you down the right path. But if you think you have enough time to become serious about your finances, think again. You may still feel young and invincible even when you hit your 30s, but the scary truth is that you are halfway to retirement. It is time to put the financial foolhardiness of your 20s behind you and become more frugal with your cash by mastering these top financial habits. 1. Actually Stick to a Budget Most 20-somethings have played around with the idea of a budget, have used a budgeting app, and have even read an article or two about the importance of creating a budget. However, very few individuals actually stick to that budget, or any budget at all. Once you turn 30, it's time to ditch the wishy-wash...

From Barron's: Richard Thaler is a prolific academic, a successful author, and a principal at an investment firm with billions of dollars in assets under management. He has also appeared on the silver screen and has a Nobel Prize for his contributions to behavioral economics. Thaler, a professor at the University of Chicago Booth School of Business, recently sat down with several of us at Barron's to explain how investors can be overconfident, nudged, and where they commonly go wrong. Leslie Norton has some of the highlights: It’s the new year. What behavioral errors should people watch out for? Most people are under-saving. I blame the plan sponsors, because it means they haven’t employed my favorite intervention called “Save More Tomorrow,” where you automatically increase the saving rate over time. We know that the best way to reduce biases is just to make decisions automatic. Investors are less stupid if they’re in a target date fund that prevents them from p...