financial nuggets

Monday Financial Nuggets: The Poor, The Rich, and The Wealthy

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The poor, the rich, and the wealthy: God made them all. Baring any financial inheritances, and level playing fields, God created all equal – one head, two eyes, and two legs. None was born with two heads and three or four legs, right? Such a being will no longer be human.

Why then are some poor and some rich or wealthy? Why isn’t everyone in a level financial field? And why is it that some no matter how hard they labor, it’s as if the money is being thrown into a basket with holes and yet have to worry about food, clothing and shelter? Yet, some only work a few and have all the luxuries of life and not a care in the world?

Is it right to say that God intentionally created some to be poor? God, the One who owns the hills and cattle on the hills (meaning that God is abundantly wealthy and owns everything) will desire that His sons and daughters live in abject poverty, while reserving the wealth for a few 1% (10%?)? That is not the kind of God I have come to know. Let’s think about this for a second.

The above verse has weighed heavily on my heart until I came across another statement, then I understood what the verse meant.

The Three Types

There are three types of people in the world: the poor, the rich, and the wealthy.”

Dr. Myles Munroe

“There are three types of people in the world: poor, rich, and wealthy.” This statement was made by the late Dr. Myles Munroe, the Sr. Pastor of Bahamas Faith Ministries International. Dr. Munroe went on to say that:

  1. Poor people always talk about money. “I don’t have enough.”
ThinkerTalker says: Change your words and start speaking in abundance and positives, lest it becomes self-fulfilling.
  1. Rich people think about “things” and what they have. “Look at my clothes, yacht, car, stock, etc.”
ThinkerTalker says:  Don’t let “things” be the yardstick for measuring your life. There are tons of invaluable feats that we can invest in. Let’s look for those.
  1. Wealthy people think and talk about ideas. They don’t think or talk about their money or things.
ThinkerTalker says:  May God bless us with multi-million dollar ideas and creative abilities.  Could it be that we are already blessed with those million-dollar ideas but we’re sitting and procrastinating on them or allowing fear to keeps us from moving forward with them?

Looking at the three different types of people, we can deduce the outcomes based on each’s mindset, focus, time and money management. Including each’s proactiveness and reactiveness.

In order to become a different type of person, one has to desire the type and vigorously pursue it. what it is that is done differently by those types.

Income Inequality

Put another way, there is income inequality and the gap has widened for the top 10% while shrunken for others. “Income allows a family to get by; wealth allows a family to get ahead.”

Credits: Federal Reserve, St. Louis

“Income is also a fairly common indicator of financial well-being.”

Education has been deemed a necessary tool to help in reversing the lack. Still some debate the need of education because of such people like Bill Gates and Steve Job. Such folks should engage in however means they know or have to stay informed, 

Demography may not be economic destiny, but it is strongly related to financial outcomes

St. Louis Fed

In conclusion, we can reverse an unhappy financial situation, be it personal or generational, by investing early in life for the long run, having cash (or readily convertible to cash) in hand, spending wisely, and managing the money we have.

Thanks for reading. Cheers to your wealth and improved financial situation

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Monday Financial Nuggets: 10 things I wish I knew about Insurance

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  1. Keeping the life insurance I had when I was younger. Generally speaking, we are all more agile and healthier at 20-30 years old than we are at 40 and over. Buying life insurance at an older age is more expensive. I realized that if I had retained the whole life insurance, I could have locked it in at the former premium.
  2. Buying whole life is better than term. At end of term, one is older and life insurance becomes more expensive. Exception is only if one dies before the term life ends.
  3. Auto insurance is higher for a leased or financed car than for a car bought outright or owned free and clear. This is one of the reasons people talk about preferring to buy used cars.
  4. You get a better (I hate to use the word “cheaper”) rate/premium having the same insurance company for multiple cars, as well as using the same insurance company for your other needs; for example, home, renters, personal, life, etc. It’s called bundling.
  5. That auto insurance companies can use your no-fault auto claims as a potential negligence on your part and raise your premium.
  6. In insuring personal items, keep detailed information and receipt of valuables, as well as take photographs. This will help in case of loss.
  7. Having a fireproof safe box is a good investment.
  8. Staying with the same phone company is good. You can lock-in the plan/price you initially got if your needs remain unchanged.
  9. The essence of having insurance for cellphones, especially when new. The concept is similar to any other insurance, but not necessarily worth it after 2-4 years of owning the phone.
  10. Your good, and long, driving record can get you discounts off your auto premium.

The above are based on my experiences. Insurance companies’ policies do vary. As always, please do your due diligence (research, compare premiums, and ask questions) before purchasing any type of insurance.
Have a financially-wise week.

Monday Financial Nuggets: Youngsters and Money

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Few working youths (per United Nations’ referenced ages 15-24) know what to do with money, either earned or gifted to them. I used to be one of those several years ago. Maybe not totally, but looking back, I acknowledge that I could have done better.

A working teenager has no money responsibilities like bills or rents/mortgages, except to splurge on new outfits, shoes, makeups, eat-outs, and other mundane things. Not that those things are unimportant, but it’s sheer vanity to acquire and accumulate endless amounts of them, most of which lay unused.

By the way, if you have tons of these mundane things lying unused in your closet or house, have a garage sale or post them on platforms like Depop, OfferUp, or Facebook Marketplace. Of the three, I have only used OfferUp, but my daughters have successfully used Depop and FB Marketplace. Please do your due diligence before choosing one for your purposes.

Once those mundane items have been sold, resist the urge to buy more things, and invest the money or put it in your savings account.

But what if the teenager could save at least half the amount of their paycheck every week and never touch it. For example, saving $50 every week for three months (using summer when most work), s/he would have saved $600 . On top of this, interest accrued depending on where the money is saved or invested, could add an additional $1-$25 or more per year. Imagine leaving that money untouched for another four years while in college, with compounded interest … Think about that for a second.

If a teenager could discipline him/herself to save and/or invest, it becomes a habit that will stick and only get better. The teenager would have mastered a money habit where most have failed.

Similarly, graduating out of college and starting full time job is the dream of almost every graduate. Some however are anxious to be independent and live alone. But precious one, what is the hurry? Ponder for a second how great it would be if you could live rent-free with your parents while working in an effort to save the most that you can for down-payment for your own house? It becomes harder to save when the bills start pouring in and/or when you start a family. I am puzzled when kids look forward to being 18 and independent. “Now I can drink alcohol” seems to be the most popular reason they give for the excitement! Hello?! There are better and more things in life than the liberty to be able to buy and drink alcohol. Why not think on those things?

Needless to say, the earlier you start saving and investing, the better. The rule of thumb is to save three to six months’ living expenses. Some say three months’ salary. Either way, the goal is to start and save the minimum of either three months’ salary or living expenses.

There’s no need to rush out of your parents’ home. It is a shield for you. Use living with your parents wisely and to your advantage before the bills start rolling in.

I acknowledge however that there are several other reasons when a young adult might decide to move out. Reason such as finding their first job in a different City or State. This is understandable but should be the exception and not the norm.

The essence of this post is to encourage youths to save, invest, and spend wisely. I hope it communicated that. If not, do let me know.

Monday Financial Nuggets: 10 Tips for Success

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youtube.com/watch

Financial Words of Wisdom from Dr. Myles Munroe. I hope the video blesses you.

. . .

  1. Everything is subject to change (To everything there’s a season and a purpose under heaven Ecclesiastics 3:1-2). Never make a permanent decision in a temporary problem.
  2. Do not pursue success or money or things. Pursue purpose, vision, ideas. There are three types of people; (1) poor, (2) rich, and (3) wealthy people. Poor people talk about money all the time; rich people talk about things, while wealthy people talk about ideas. Ideas, not money, control the world.
  3. Look for deployment; not employment. Your job is what you’re trained to do; your work is what you’re born to do. Job:Compensation:Retirement vs. Work:Fulfillment:Never Retire.
  4. Change. There are again four types of people: (1) Those who watch things happen (2) Those who wonder what happened; (3) Those who don’t know that anything is happening; and (4) Those who make things happen. Be the proactive people who effect change. Not all change is positive, but without change there can be no improvement. You have to decide what kind of change you want.
  5. Become a person of value; develop yourself and focus on self-improvement and self-expansion. Intellectual capital.
  6. Pursue God. Follow your passion.
  7. To be a genius, just do a little extra. “When experience is your best teacher, progress is imprisoned.”
  8. Use your adversity for your benefit.
  9. Discover your purpose.
  10. Learn from every experience; good or bad.

Have a great and productive week. 😊

Monday Financial Nuggets: Earl Nightingale’s Checklists

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youtube.com/watch

The above Earl Nightingale’s video has been popping up for a while. I finally watched it and what a goldmine! Please watch till the end as I believe that the platinum nuggets lie within the 5-7 final minutes of the video.

Haves and have nots. The have nots always begrudge the haves! (p.s. Tyler Perry has a series with this title. The only series that I have watched religiously in the last ten years! Love it. Check it out on OWN. You can also find various streams on YouTube.)

Why do few manage to be financially well-off in a country where success is available?

Statistics

  • 10% of men 65 years and older have income of $6,000 a year; >80% of all men >65 have income of $4,000 a year
  • Starting a career in your 20s, would mean you would have worked >40 years at retirement. Using a meagre $25,000 per year salary, (a paltry in this tech age), means you would have made >$1 million. How much of this was saved or invested?
  • Only about 10% will be financially secure when the age of 65 rolls around.

Questions to ask yourself

  • What are you doing at the present time to increase your income now?
  • How much do you want to earn?
  • How much money are you planning to be worth at age 65?

Constructive thinking on the above questions is necessary for change in how much you earn.

Big income earners made the decision to earn more. Have you? Will and when would you?

Analogies:

  • A woman who does not think about baking an apple pie for dinner tonight will not think of looking up a recipe for apple pie. Without the decision for pie, there’s no motivation for checking out the recipe. Likewise,
  • A man who does not think about driving his car to St Louis MI or Nacogdoches TX will never make the decision to get roadmaps that will help him get there. Therefore,
  • A man who never decides to earn more money will never think of learning how or looking up the rules for making more money.

Lifestyle Quotes

It’s a free country; anyone has the inalienable right to be just as wrong as they want to be!

We must view with profound respect the infinite capacity of the human mind to resist the inroads of useful knowledge. – Thomas Lounsbury

Knowledge is available to everyone. We can either listen to those qualified to teach us or we can go along with those ancient stumbling blocks we get from people who don’t know any more than we do.

. . .

A jet pilot goes over his checklist item-by-item before a takeoff from the airport and before he lands at his destination. Living successfully is just as important as flying an airplane.

. . .

Checklist

  1. Our rewards in life will always be an exact proportion to our contribution our service. (Similarly regarding JOB: The money you’re paid by the company you work for will always be in direct ratio to the need for what you do, your ability to do it, and the degree of difficulty involved in replacing you.)
  1. The gold mine. “The only thing about a man that is a man is his mind; everything else you can find in a pig or a horse.” – Archibald MacLeish. The key to any man’s success is his mind!
  • How many good ideas have you come up with in the past year?
  • Are you being a copycat or following the follower?
  • Whose drum are you marching to?
  • Do you want to be a contributor or a beneficiary?

3. Attitude. Alter your life by altering your attitudes of mind. (We become what we think about!) – Williams James

Think. Start getting up one hour earlier than you’re accustomed to. One hour earlier a day gives you 6 1/2 40-hour week a year. Take a refreshing shower, dress, have a hot cup of coffee (or tea) and then sit down with a clean sheet of paper. At the top of the paper, write your financial goal which is the amount of money per year you intend to earn soon. Then start to think; think about your goal and see how many ideas you can come up with to help you reach that goal; ideas to improve what you now do for a living, ways of increasing your contribution to match your income goal . . .

Cheers to a strategically financially you in 2021!