You're looking at posts tagged with right now.

25 years left to be a millionaire.

Since last year, as I started to have a steady income by having a real job instead of applying to graduate schools, I decided to read more about finance so I bought some books: the automatic millionaire, smart couples finish rich, and the millionaire next door. Obviously you could tell that I want to be a millionaire and unlike my dad, I can’t become a millionaire by buying those lottery tickets every week.

First of all, please don’t take avatrade scored well in this review because I think I have a greedy side that I want to become a millionaire. It’s because I want to be finanically independent so that I don’t have to work well into my sixties. Life is way too short for that. Besides, I’m fascinated by this idea that you don’t have to be earning six figures to be able to become a millionaire. You can earn as little as 40k to achieve a million dollars in your savings.

After reading those books, I learned quite a number of things. Most of them are pretty common sense like don’t put yourself in debt. Good thing to know that the only debt I have is my car loan, which I hope to pay off in about 2 years. I learned that being rich and being wealthy aren’t the same. They are two different things. Another thing I learned was to always pay yourself first, which means money goes into your savings immediately after you receive your paycheck. The author, David Bach, suggests that you save 20% of what you earn and you’ll be well on your way to being finanically sound. “The Next Door Millionaire” author said he found that what set them (the millionaires) apart from millon other people who are in debt more than 10k is because they simply track their money and keep a cash flow spreadsheet of my payday loans. After reading those words, I decided to keep a spreadsheet of my cash flow—how much I earn and how much I spend. It may turn to be the best move I have ever made in my whole life.

In the past, I thought I had a pretty good idea of where my money was going and thought I was doing a pretty good job at saving my money but I was completely wrong. After putting a large sum of my savings on buying a new car, paying off all the outstanding transactions that my college had billed me before they would send me my diploma, and moving into a place far from my hometown, my savings was pretty much blown. It didn’t help much that I was in my “college guy” mode that I thought if I’m going to get a job in the future, I’ll spend this money now and I’ll get it back later when I get a job and put it into savings. Nope, it didn’t exactly work out like that.

So, I started a spreadsheet about a year ago and I thought I would have abandoned it a long ago but thanks to online banking, it was actually easy to track my money and record every transaction in my spreadsheet. A year passed, my spreadsheet begins to look like, well, a spreadsheet, instead of a blank empty white spreadsheet. I could have sworn that it was done by a CPA, not someone like me. Maybe it’s just me but I find it fascinating to look at my spreadsheet and see how much I spent on electronic stuffs, foods, gas, clothes, etc. And realizing the mistakes I’ve made, which is a lot.

This is how my 2005 budget looks like:

  • In the foods category, I spent about $3,000 or about $250 a month on groceries and eating out. Shit, I’m a hungry man with an expensive palate. (how do buffets and sushi sound?)
  • I’ve withdrawn a total of $2,150 dollars out of ATM. Anyone wanna rob me?
  • I paid $830 on gas. Could have been a lot worse if I owned a SUV.
  • Being a golf avid player (and a wanna-be pro), I spent $855 on course fees, equipment, etc.
  • I enjoy reading books, so I spent $160. Education sure comes with a price. And dammit, I need to sell these books.
  • I spent $370 on clothes. Not too bad for a guy, don’t you think?
  • I read somewhere that someone put “stupid mistakes” category for not paying bills on time, fines, fees, or penalities he has to pay, so I thought that was a good idea and it was a very costly one.

    So, in bank fees, I had to pay $170 and this next one, I’m not very proud of myself, I paid a whopping $825 dollars in parking tickets (lots of them), stupid speed camera tickets, and traffic tickets (for failing to stop completely and among others). I guess that’s what you get for living in DC your first year. That comes to almost one thousand dollars that I could have avoided to pay if I followed the sign, pressed on the brake more, and eased off the gas pedal a bit more. This year, my goal is to pay zero. My right foot, please behave.

  • For us who own a sidekick, I paid $386 in subscriptions and extra programs like games. I can’t wait when my employer will cover my sidekick. Hehe.

Even all with those expenses I had to shell out, I was still able to save 20% of my total earnings in 2005 and I wouldn’t have done that if it wasn’t for my precious spreadsheet and by paying myself first. Now that year 2006 has started, my goal is to save 30% (large part of that will go toward housing down payment wherever I decide to settle down), pay nothing in “stupid mistakes”, and perhaps reduce my ATM withdrawls but I’ll never ever reduce my food budget. :-)

Anyone up for some sushi?

Tags: , |

Being financially savvy

Ever since I’ve been supporting myself on the income that doesn’t come from SSI, VR, or my parents, I’m learning a whole lot about the game of finance. It’s one of the first things you’ll face once you step out of college and into the real world, with no one backing you but yourself. Housing rent, car loan, groceries, buying things that you’ll never buy if you were 60 years old, etc. If you live in DC like I do, it sucks to learn that it’s nearly impossible to find a house or a condo under 150k (hey! I hail from Illinois, known for its never-ending cornfields), thus, I have to rent a place till I know for sure that I’m gonna live here for the rest of my life (I sure hope not.) That leaves the question when I’ll ever own a place someday….

I’ve always strived to be knowledgeable about things—I don’t mean in a way that I think I know everything—just being in the know. Thus, I read, study, ask questions, ponder abt things, talk with friends over certain subjects, that contributes to the learning process and like Gandi said, you never stop learning. So, lately, I’ve been reading nonfiction, mainly on finance. Why is that? Well, if you want to continue working well into your seventies, please do help yourself. I sure don’t. To do that, I have to reduce my spending and save money. After reading “the Next-Door Millionaire” book, I discovered that I’m an under-performing accumulator. It means that I’m not saving as much as I should and that I’m spending too much, or like the book said, not frugal. The author in the book said that those who are millionaires don’t even have six figures income, they do it by being frugal or PAW ( Prodigious Accumulator of Wealth). They save whatever income they have and minimize their spending. Over time, they build up a million dollar nest egg and once their mortgage has been paid off, they say good-bye to their work. Sounds nice, doesn’t it? Now, I know a friend who’s a year younger than I am and she has already saved nearly a half hundred thousand dollars. That pisses me off…

So, if you want to get off to a good start, and that you’ve read this far, I have some good news to tell you. I realize I’m not the only one who seems “obsessive” about his finance and there’s tons of blogs that are almost completely devoted to accumulating wealth and to retire with a million dollar by the time s/he is 50 years old. That makes me feel somewhat better and not too nutty. Yahoo! lists the top ten money blogs here. That’ll give you a good idea of what’s their goals and what they’re writing about.

“What? is that the good news?” you might ask. No no, the good news is THIS. Need an interpretation of that? Simply said, you get 5% cashback at supermarkets (Giants, Safeway, etc), drugstores (CVS, Walgreen, etc), and gas stations and 1% at any other places. Those places make up, like, 80% of my whole expenses excluding the rent and car loan. In case you need a loan I recommend to check out billige forbrukslån. If you were to spend $100 at those places, you get 5 dollars in return. How about $200? that’s 10 dollars. $500? 25 dollars. Now, you’re really getting something back! However, the big trick here is that you need to pay it off every month, otherwise, they’ll charge you 10% or more for it as an interest, which means you’re not getting advantage of the cashback (And they’re probably laughing at you for falling into that pitfall). That gets you down? Well, don’t forget you can ask for real cashback dollars, like at an ATM, at those places. Say bye-bye to those stupid bank fees!

Tags: |

“Cliff-Notes style” guide to Financial Independence

I usually find good stuffs via and saw this page. Thought I’d share with you guy, that is if you’ve been meaning to save money, pay off your credit card debt, start some investments and most of all, you don’t want to be still working into your sixties or seventies.

This guy said he’s read over a dozen books on financial independence and he’s found a recurring theme almost in each of them. He summarized them up and include a guide or rules in a bullet-style list. That way, you don’t have to spend $20 on each book (I’ve read three) and you can remember the points better and use the page as a quick reminder or reference.

Learned something from that article. He said financial independence is achieved when your monthly investment income equals or exceeds your monthly needs such as car payments, house payments, etc, which will take a long time to acheive. How nice would that feel when that happens. No more getting up early in the morning and dragging my ass to work. Play golf all I want.

Mantra #2: “Is this a need or a want?” Ugh, I hate this question but it’s vital to your financial independence. Dang, I want more golf balls, new suspension (sway bars, shocks, short-throw shifter) for my car, new G5 powerbook, and the list goes on endlessly, sigh.

This sentence got my attention.
Mantra #4: “Cash is better than credit.” There is almost no reason to carry a credit card.
True, ‘cuz it would incur debt (doh). I carry my debit card instead and some cash when they don’t accept debit cards like Vietnamese Pho cafe.

So, if you read the article, followed the steps, and for the rest, you have to be committed and disciplined. Doesn’t that sound familiar?

Tags: |

Millionaire Next Door: The Surprising Secrets of America’s Wealthy

Since I’ve started working at the U.S. Dept. of Agriculture and getting steady paychecks, I’ve 6 month bad credit loans and become conscious of my cash flow. I want to be more financially responsible and grow my wealth. So I went to the Barnes and Noble bookstore and browsed through aisles. Found this bestseller and bought it. Man, I really learned a lot from this book—-common sense, advice, and wisdom make up the most part of this book. The book explains that being rich and being wealthy are not the same thing. It’s “Income vs. Consumption.” You may be earning more than 100k (only 5% of all Americans earn more than 100k) but you spend on a lot of things (consumption), such as 60 inch tv, fancy house, 2 or 3 different luxury cars, pool, and so on. These prevents you from becoming wealthy. You may look “rich” to your peers but inside, you’re really not.

The book has a formula of how wealthy you should be. (I left my book at home so I’ll look up the formula again) The big key to become wealthy is to “live below your means”. That means don’t overspend your income earning and try to have the widest margin between spending and saving as much as you can. The less you spend, the more you can save. Then your money begin to accumulate and build wealth. That’s all there is to it. But we are in the capitalism world and we’re surrounded by marketing—billboards, tv commercials, even competition with your peers who just bought a brand-new car or a big screen tv.

It also talks about Offense and Defense. We have to defend ourselves from those marketing pitfalls. Offense is accumulating wealth while defending against spending on items. I learned more about taxes and why people are always trying to avoid paying taxes. I realize that the government really takes a big chunk of your money (approx. every 30 cents of a dollar goes to the government), so the best you can do is to minimize your income taxes.

To do that, start investing in tax-deferred accounts such as 401k, TSP (Thrift Savings Plan for those who work for the Federal), IRA (Individual Retirement Account). Your paychecks will be deducted first before tax is charged. I plan to invest in these accounts as soon as I build up my savings account first (for emergency).

Finally, if you’re 25 years old or less, like I am, USE YOUR AGE AS YOUR ADVANTAGE because the younger you are, the more you are able to accumulate your wealth over time. So that’s what I’m gonna do. Start investing early and live below my means. That’d be a struggle for sure and takes some time to become used to it. My goal to be financially independent before I become 50. :-)

Tags: , |


korea deafness Life pics blogging thoughts Links birthdays family Writings videos adoption running google reviews workouts design sign language beers apple psychology economics philosophy education Golf languages travel food snowboarding traveling finance tips wordpress tech sports science identity asl reading childhood movies news coding honda shoes people buildings beauty surfing nature twitter obama blackberry howto time toys ergonomics party dreams textmate speeches wiki gmail san francisco dinosaurs extinction trains technology hydration element bike human capital deaf olympics xbox dating productivity communication ego hockey iphone