Abundance

BLOG PROBLEMS

2006-10-19T11:20:00.000-06:00

We found out not long ago that many of our posts were not showing up on the blog! We use a special program to write our entries and it was showing us that everything was hunkydory! Over the next few days, expect a ton of posts to show up so scroll back and read what you have missed!

We are sorry for the inconvenience.

Great Reasons to have a Home Based Business

2006-10-19T11:18:00.000-06:00

We've always encouraged our clients to have a home based business. It is a wonderful way to provide extra income as well as to receive certain tax breaks and incentives. It is a great way to find something you enjoy and turn it into a money making venture. Many of our clients have subsequently made their part time business their full time company!

For those of you that might still be on the fence about this, the following article might help you make up your mind.

By the Census Bureau's last count in 2002, half of all businesses in the U.S. are home-based. The U.S. government encourages this kind of entrepreneurship. Dig deep and at-home entrepreneurs will find a few precious tax deductions, say Mark Birge and Steve Mentzer, accountants with Aldrich, Kilbride and Tatone, an Oregon-based accountancy firm.

...

Below are five deductions homebodies would be foolish to ignore. (The last two also apply to any small-business owners.) To increase your odds of success, be sure to keep your business and personal life separate--including all checking accounts, credit cards and phone bills. "Don't commingle," says Mentzer. "You'll always lose out to the IRS."

With that advice, lets see the deductions!

1. Infrastructure (utilities, phone service, housekeeping services, landscaping)

Run-of-the-mill homeowners and renters can't deduct these expenses, but at-home entrepreneurs can. To calculate the percentage of these "indirect expenses" that is tax-deductible, determine how much of your house is used as office space. If your office takes up 200 square feet of your 2000-square-foot home, you can theoretically deduct 10% of these expenses. The IRS doesn't require the area be confined by walls--only that you spell out why you call it an office.

This is awesome! Now that room that you have been using to store your computer and surf the web can be converted into your office and used as a tax break!

2. Home mortgage interest and property taxes

U.S. taxpayers can deduct these anyway, but as a small business owner, you can save even more by applying a percentage of mortgage interest and property taxes to the home-office section of your tax form, says Birge. Reason: Deductions for mortgage interest and property taxes are capped, but there are no limits on the home-office portion.

Read that last part again. There are NO LIMITS on the home-office portion!

3. Travel expenses

You can't deduct fuel expenses if you commute to work each day, but if you work from home, you can deduct the costs of traveling away from your home for any business-related activity. For each mile traveled in a car, deduct 44.5 cents. Alternatively, you can take the percentage of miles traveled for work and deduct that proportional amount from what you spent on gas, oil changes and repairs. Mentzer suggests keeping a mileage log and writing down the purpose of every trip and the date in case the auditors come calling.

With the cost of fuel these days, this is very important. We have some employees that are averaging over $600 a month on gas alone. Now, if they were able to deduct part of that because they had a home-based business it would be a huge lifesaver! The log mentioned above is very important. In fact, we recommend logging all home-based business expenses. This will help you avoid any problems with the IRS and allow you to prove to them all the deductions you take. Again, KEEP A LOG!

4. One-time office equipment purchases

Section 179 of the tax code says you can take a one-time deduction--up to $105,000--for the purchase of office equipment, as long as you don't purchase more than $400,000 of equipment in a calendar year. That's nice, but many startups don't generate enough pretax income to get the full benefit of the deduction. Married entrepreneurs have an edge: If one spouse spends $10,000 on equipment, but only brings in $5,000 in pretax income, he can still apply that entire $10,000 to the couple's joint tax return. "There are not too many situations where it is beneficial to file separately from your spouse," says Mentzer.

Read that and follow it carefully. We encourage our people to take every tax advantage possible when running a home based business. Sometimes, getting these advantages aren't easy and there are some hoops that you will have to jump through. Make sure that you do it!

5. Family affair

Sole proprietors with children under 18 who work for them can deduct their children's "wages." Just make sure you actually get some work out of the whippersnappers.

It is a great opportunity to teach your children the value of hard work in a safe environment. The world can be dangerous and having your children work in certain places might not be the best thing to do. Having a home based business allows you to control all aspects of the work they do and the people they work with. A win-win situation!

These are only a few of the reasons to have a home based business. We'll continue to write more about this in the future so come back often!

Real Financial Heroes

2006-10-13T14:43:00.000-06:00

These videos say it all. Hilarious and yet, far to true in today's world. You'll understand when you see them.

Real Financial Heroes

1. Mr. Impulse Buyer Guy

2. Mrs. Addicted to Big Sale Shopper

3. Mr. & Mrs. Too Much Home Buyer

Eight Great Year-End Moves

2006-10-11T14:28:00.000-06:00

It's hard to believe that it is getting to be that time, but it is! The year is coming to an end and it is time to start thinking about next year. With that in mind, this wonderful article tells you some of the things you need to do to get ready for next year. Let's take a look at them.

1. Rebalance your 401(k)

2. Revisit your estate plan

3. Sock it away

4. Give smarter

5. Review your health plan

6. Clean up your taxable account

7. Do a property insurance checkup

8. Check the new credits and taxes

Each section links to the appropriate area. There is some really good information in here for all of us.

Abundant Women Leaves Incredible Legacy

2006-10-10T14:17:00.000-06:00

A woman who died not long ago at the age of 100 leaves over $35 million to charity. She lived a life of abundance, not a lavish life, but a comfortable one. Her goal in life was to leave money for research to help others and she was able to do so.

A 100-year-old woman who quietly amassed a vast fortune before her death last year left $35.6 million to local diabetes and cancer research.

Eugenia Dodson donated two-thirds of the money to the University of Miami’s Diabetes Research Institute, the largest gift in its 35-year history. The rest goes to the university’s Sylvester Comprehensive Cancer Center.

What an amazing woman! We salute her and her example of Abundance!

Time for a Raise!

2006-10-07T11:27:00.000-06:00

Not our normal subject material, but we know that all of you are working hard, living abundantly and deserve to make more money! So, here are some tips on how to ask and get that raise you deserve.

1. Have your ducks in order. Of course, you can't march into a meeting with your boss armed simply with your opinions. You need to back it up. That means analyzing and cataloguing what you've accomplished in the past year, writing it down and then preparing for that all-important meeting. It's also a good idea to bone up on industry standards. One good source is salary.com's salary wizard.

This is so very important! You know you deserve that raise, your boss probably does as well; but unless you have the information needed to justify it, forget it! You need to be able to show just how much you are needed and what a wonderful job you are doing. When you do this, it makes it easier for your superior to justify giving it to you!

2. Know the business climate. It's also important to know the current economic environment -- not only in the national economy but also in the company. "If business is booming, then seeking your fair share of the wealth is understandable," says Mimi Greenberg, president of MRG Associates, an executive search firm in New York City. "But if you're employed by a start-up or a larger company actively looking to slash costs, it may not be a very good time to ask for a bump in your paycheck."

If your company just lost money or broke even, it might not be the best time to ask for that raise, even if you deserve it. Keep your eyes open for the right opportunity to ask, then pounce!

3. Rehearse. Know what you want to say to the boss and practice saying it out loud. Remember, you are selling yourself.

We thought about moving this to number 1. 99% of people asking for a raise seem to be doing it off the cuff by the presentations they give. Work on it! Spend time getting it ready! This should be the best, smoothest presentation you've given all year. You've wowed them all year with the work that you've done, now wow them with your raise presentation!

4. Prepare for the worst. According to CareerBuilder.com, one of the largest online job-search Web sites, less than 1% of people who ask for a raise get it right away.

If your boss won't give you a raise, ask for other things such as more vacation time, a laptop computer or other equipment. If you are turned down, express disappointment, shake hands and calmly walk away. The composed manner in which you take the rejection may give your boss the impression that you have something else lined up -- even if you don't.

Many times superiors won't give a raise immediately just to see what your reaction is. They can find out just how loyal you are and just how well you are able to handle adversity. You've done well up until now, don't blow it! Be calm, be cool and who knows, you might get a call back.

5. Be gracious. If the final answer is "yes," express appreciation, but do not go overboard. Work twice as hard to prove your boss made the right decision. "Start right then and there earning that next raise," says Greenwood of Common Sense at Work.

Yes, yes, yes! Very important. Be gracious and then work even harder to show them they made the right choice.

You are all living abundantly so this should come natural. Even if it doesn't, if you follow the steps given above, it will seem to flow naturally from you.

Now get out that and get the money you deserve!

Lower your Debt, RIGHT NOW!

2006-10-06T10:35:00.000-06:00

This is more for those who have just graduated college, although some of the advice is good for all. As we preach non-stop, get out of debt, get out of debt now! You can not imagine how good it feels to owe NOTHING! When you owe nothing, you own everything! Your life is your own!

Let's look at some of Kiplinger's ideas to debt reduction.

1. Consolidate your student loans
Consolidating your federal loans is like refinancing your debt into a single loan at a fixed rate.

2. Shop around for the best student loan perks.
Thanks to recent legislation, you are no longer required to consolidate with the lender who holds your student loans. You now can shop around for the one that offers the best terms that will help you trim your debt even further. For example, look for a lender that offers a discount on your interest rate if you opt to have your payments electronically debited from your checking or savings account each month and another rate reduction for making on-time payments over a 24- or 36-month period. Such perks can typically shave between 1 and 3 percentage points off your rate, saving you hundreds of dollars over the life of your loan.

These are both great ideas. People are shocked when they look at what just a 1% reduction in interest will save them over the life of a loan!

3. Ask your credit card company to lower your rate. Sometimes a solution really is this simple. A five-minute call to your lender could save you hundreds of dollars on interest charges. In 2002, the U.S. Public Interest Research Group asked 50 consumers of varying credit backgrounds to call their lenders and ask for lower rates. The strategy worked for more than half of the group, with the average rate reduction going from 16% to 10.5%.

4. Shop for a lower-rate credit card and transfer your balance. If your credit card company won't lower your rate when you ask -- or it won't lower it far enough -- shop around for a better deal. Once you have been making regular payments on your college-issue card for a while, you might have built enough of a credit history to get a lower-rate card elsewhere. Watch out for introductory offers, though. You don't want to get reeled in with the promise of a 5% rate only to find that it'll shoot up to 18% after three or six months. Unless you're confident you can pay off your entire balance within the introductory time frame, you'd probably be better off with a card charging a fixed rate.

5. Scrap the monthly fee. Your low-rate card may not be the deal you think it is if you're paying an annual fee. For example, if you pay $40 each month toward a $1,000 balance on a card with a 12% interest rate and a $50 annual fee, that's equivalent to a no-fee card with an 18.4% interest rate.

The killer of this nation, credit cards. There is nothing that can be more evil and destroy your independence faster than a credit card. Yes, they are necessary in life, but make sure you control them and not the other way around. Kiplinger's advice on the subject of credit cards is great! Follow it!

6. Trim the fat from your spending.

We like the title of this advice, just not all the rest that they give you. So, sticking with the title, we say, trim the fat and use the excess to pay off your debt! Be careful when trimming the fat that you don't go to far. Life is to live and enjoy! If you trim so much that you get rid of all the joy you'll just end up rebounding and going on a spending spree that will set you back years in your quest to become debt free! You need some excesses in life. You need to do those things that make you feel good. Just don't go overboard!

Of course, these are the things that we excel at. If they are giving you problems, give us a call! We are here to help!

Finally...

7. Stop using your cards. "If you're paying down one credit card and charging up on another, you may as well be a hamster on the wheel going around and around -- you're never going to get off," says Dvorkin, and you won't save any money. Put your credit cards away, and you'll whittle away at your debt faster, as well as spare yourself a future of more debt. But don't close the accounts -- having unused credit available from lenders you've been with a long time can actually raise your credit score.

We agree with this to a point. Put those cards away while you are paying off your debt. Once that debt is paid off, use your cards, just make sure to pay them off, completely, at the end of each month! NEVER, EVER, EVER, NEVER, EVER carry a balance on your credit cards again!

Kiplinger didn't do a bad job of giving advice. With a few tweaks here and there, it becomes great advice!

Now go out and have an AWESOME day!

A Nation of Addictions

2006-10-05T10:14:00.000-06:00

Nothing kills Abundance like addictions. It destroys families, friends, relationships, everything. It can eat up your last dollar and destroys your ability to make good, proper and wise decisions. Avoid addictions and if you are addicted to something, GET HELP!

People have no idea how much addictions cost. Leaving out the emotional burdens, lets look at the monetary burden alone.

The 5 most expensive addictions

* Alcohol. Estimated annual cost: $166 billion. Binge drinking hits the unemployed harder on a per capita basis -- 10.4%, vs. 8.4% of employed people. It is most prevalent in small metropolitan locales, rather than big cities or rural areas. The $18 billion spent on alcohol and drug treatment last year represented 1.3% of all health care spending.

* Smoking. Estimated annual cost: $157 billion. The tab includes $75 billion in direct medical expenses, with the rest in lost productivity from ill patients missing work. Given the low-tax (or no-tax) underground cigarette economy on the Web and on Indian reservations, it's unlikely that sales and usage have dropped much over the past decade, official government statistics notwithstanding.

* Drugs. Estimated annual cost: $110 billion. Like alcohol, illicit drug use is more prevalent among the unemployed. Most addicts are also heavy drinkers, though only a small minority of alcoholics are drug abusers. Crystal meth has followed marijuana, cocaine and heroin as the drug of choice among the young set.

* Overeating. Estimated annual cost: $107 billion. Overeating increases the risk of many health problems, including heart attacks. Obesity causes 14% of attacks suffered by males and 20% of those suffered by females, the National Institutes for Health says, and fewer than a third of adults get regular exercise. The bulk of the $107 billion is the direct cost to treat heart disease, osteoarthritis, hypertension, gall bladder disease and cancer.

* Gambling. Estimated annual cost: $40 billion. Addicted gamblers often feel compelled to chase after bad bets with more money in the hope of winning back their losses. And some who catch the fever develop the need to periodically raise the betting stakes to keep the same thrill. Also, addicts often face job loss, bankruptcy and forced home sales, and they are at greater risk to commit crimes like forgery and embezzlement.

Just look at all that money wasted! Scarcity, scarcity, scarcity! That is money that could have been used abundantly, sucked down a dark hole. Yes, someone will use the money and maybe, eventually, it will be used for an abundant purpose, but for you, the addicted individual, it is wasted.

Again, if you have an addiction, get help now!

When Did 40 Hours Become Full Time?

2006-10-04T09:20:00.000-06:00

As any of you that have started your own business realize, 40 hours being full time is a joke. Still for the guy or gal punching a clock, that 40 hours is sacred. So when did that begin?

Workin' nine to five, what a way to make a livin' -- but before 1938, many Americans spent sunrise to sunset on the job, six days a week. And you thought your job was bad.

Workers agitated for a 10-hour day as early as the 1820s. Laws were passed reducing work hours for U.S. federal employees and for women workers in a couple states, but these were poorly enforced and mostly useless.

Estimates of hours worked in manufacturing from 1830 to 1890 show that a 60- to 70-hour workweek was the norm. In 1909, New York garment workers organized a massive strike to demand a 52-hour workweek. Many of the young women who sewed shirtwaists worked seven days a week, 12 hours a day. Only some of the workers got shorter hours.

Finally, after several tries in Congress and battles with the Supreme Court, President Franklin D. Roosevelt got the Fair Labor Standards Act passed in 1938. While this law doesn't set the hours worked per week, it does require overtime pay if employees work more than 40 hours in one week. Of course, employers don't want to pay extra, so they tend to set the full-time week at 40 hours. Salaried workers aren't covered by this law, but it did turn the idea of a 40-hour workweek into the national standard.

There you have it! Be glad you don't live back in the 1800s!

Steer Clear of All Meetings

2006-10-03T09:05:00.000-06:00

Hilarious little piece on how to get along in the work. Great for a laugh, nothing more.

Here are just a couple of 'tips' on how to survive in the workplace.

3 Get yourself noticed

Getting ahead in business means getting noticed, but working hard makes you almost invisible. Therefore it's a lot better to work hard at getting yourself noticed. What senior management likes more than anything else is junior managers who show signs of initiative and volunteer to do things. Most of the reason for this is that the more junior managers volunteer to do, the less senior managers will have to do themselves. Of course, volunteering for things and doing things are two different matters. Once you have got the credit for volunteering for a project, it's best to get as far away as possible from the project before the work kicks in. The best way to do that is to volunteer for another project.

4 Remember that less is more

You would think that lazy people would form an inert mass at the bottom of an organisation. On the contrary they are found at all levels in business, right up to chair person. The reason for this is simple: when something goes wrong in business it's generally because someone somewhere has tried to do something. Obviously, if you don't do anything, you can't be blamed when it goes wrong. People who sit all day like a lemon, busily straightening paperclips, are therefore the only people with a 100% record of success, and with that sort of record, promotion is inevitable.

Plain Talk on Investing

2006-10-02T12:14:00.000-06:00

Once you get yourself completely out of debt, you can start to consider investing. Vanguard has a basic selection of podcasts on investing that are good for the beginning investor and those who are just beginning to learn about investing.

Click here to access the podcasts. Let us know what you think of them!

Retiring, Even More Difficult...

2006-09-26T16:09:00.000-06:00

We have always said that you can not rely on Social Security for retirement. Beyond that, we've always preached that you need to prepare yourself if you wish to retire in comfort at all. Now, that is looking to be even more true. It used to be that if you worked long and hard at a company, they would take good care of you when the time came. Now that is no longer true. While not quite as bad as the government, they aren't much better.

Geraldine Picha knew that her pension would be modest, given her tenure of just 15 years at the phone company.

What she did not expect was that her retiree health premium would eat up every penny of that pension — and more.

"It's frightening," said Picha, 63, whose former employer has raised her medical insurance bill steadily since she retired in 1998. At $560 a month, it now eclipses the $514 pension check Picha earned from her years at what was then AT&T Corp. and a spinoff, Lucent Technologies Inc.

OUCH! To think that you now are PAYING for the 'privilege' of being retired! How utterly ridiculous!

Let's look at more!

Over time, some maintain, growing legions of the elderly will find themselves with thousands of dollars in additional costs — posing difficult personal choices over care and new pressures on a federal government that already faces a vast, uncovered liability for the old-age needs of the baby boom generation.

"Across the board, retirement benefits are on the chopping block," said Daniel D. Doyle, an attorney for former Monsanto Co. employees whose benefits shrank after their division was spun off and filed for bankruptcy protection. "As companies try to restructure and squeeze out shareholder value, they are going to rely more and more on Medicare and other government programs to fill the breach."

Retiree health benefits first took a big hit more than a decade ago, when new accounting standards required companies to more clearly disclose those costs — prompting many employers to trim their offerings. More recently, the benefits are falling victim to rising healthcare expenses and corporate cost cutting.

On average, retirees account for 29% of the corporate medical bill for large employers that offer such benefits, according to Hewitt Associates, a benefits consulting firm. And like other medical costs, those for retirees have risen steadily — as much as 10.3% from 2004 to 2005, according to a survey of large private employers by the Kaiser Family Foundation and Hewitt.

Retiree medical benefits are now offered by just 1 in 3 large employers, down from 2 in 3 in the late 1980s, according to a study by the Kaiser foundation and the Health Research & Educational Trust.

For those that still provide such benefits, past commitments are being scaled back, and even steeper cuts are in store for future retirees. General Motors Corp. last fall announced a plan to save $15 billion in future healthcare liability for its retirees, for the first time charging retirees from hourly jobs a range of out-of-pocket costs for their medical needs.

"The double-digit cost pressures have been relentless," said Frank McArdle, head of the Washington research office of Hewitt Associates. "In many years, the annual increases for retiree healthcare have actually been greater than for active employee healthcare."

Such realities may provide little comfort to people who thought they earned the benefits when they were working and counted on them for security in old age.

"I thought I was going to live the good life," recalled Pete Wilson, 69, who took early retirement from Peoria, Ill.-based Caterpillar Inc. in 1992. He bought a 30-foot trailer and traveled the Southwest with his wife and friends. He even withdrew home equity, taking out a loan on his paid-off home, bolstered by a faith that his medical costs would never be a burden.

But last year, Caterpillar began charging Wilson $125 a month for his medical insurance premium. This year the bill jumped to $172. There is talk of future increases, Wilson said, although the company declined to confirm it. His medical bills continue to mount, most recently for a mysterious weight loss Wilson's doctors are trying to pin down.

Medicare covers most of the costs for Wilson and other Americans 65 and over. But patients are required to share Medicare costs for doctor visits, hospitals and prescription drugs, potentially exposing themselves to thousands of dollars in bills.

Private insurance helps, but it doesn't cover everything. Wilson recently had to pay $88 toward a magnetic resonance imaging procedure. His budget, meanwhile, has been strained by other expenses, such as a new furnace and air conditioner.

"We can't go to Arizona anymore," said Wilson, whose pension from his 33 years at the factory is about $1,000 a month.

Folks, it can't be much more plane. If you want to retire in comfort, you are going to have to be responsible for the majority of the money needed. Don't pout, don't be upset, just realize that it is up to you! If you need some help, not quite sure how to start? Give us a call, we are there to help you!

What it Takes to be Rich

2006-09-14T13:34:00.000-06:00

Money magazine has a fascinating article on what it takes to be rich. Let's take a look at it together.

Lesson 1: Make your own luck
Successful people create their own opportunities.

Jason, 66, had a 40-year career as a character actor in television and movies, and he could easily play the part of a soothsayer who lives deep in some medieval forest: He's small and good-natured, with a soft voice that suggests both wisdom and curiosity. (Incidentally, we're cheating a bit here; Jason lives and works a few blocks outside 90210 proper. But we're not holding that against him.)

Jason knows everybody in the business (he's married to Pamela Franklin, who once died on-screen in Brando's arms), but a decade ago he decided that he was ready to ease into a retirement gig.

He was in Eureka, Calif., of all places, when he had the revelation, filming Steven Spielberg's The Lost World: Jurassic Park, in which he played a dinosaur tracker. Jason had visited a bookstore and was examining his loot when Spielberg looked over his shoulder.

"Steven, I'm going to open a bookstore," Jason told the director. "I'm doing it."

Jason was comfortable, but he didn't want to lose money on a new undertaking.

Soon after opening Mystery Pier, he dedicated a corner to books that had been made into films - marrying the two things he was passionate about. He spread the word among that vast network he had built up, and business took off as Hollywood A-listers stopped in for first editions of books that they or their friends had made into movies.

Robin Williams, Jude Law and Bono became regulars. When I went in, Jason had everything from a full set of the Harry Potter books signed by J.K. Rowling ($40,000) to Humphrey Cobb's Paths of Glory inscribed by the star of the film version, Kirk Douglas ($6,500).

"It was really an inadvertent thing," Jason said of the profitable market niche he had stumbled on. After a moment, he added, "If I made a list of all the things in life I thought were coincidences and then looked back at them, I would see that they weren't coincidences at all."

BINGO! That is very important to understand. Things didn't just happen, Jason made them happen. He made good decisions. He had the ability to look at a situation and see it for what it was, either a good opportunity or bad opportunity. That is so very important, looking at a situation, seeing it for what it is and then making the proper decision.

Let's keep looking.

Have a growth mind-set
Lesson 2: Failing at something is the best way to ensure success at it the next time.

Carol Dweck, a psychologist and professor at Stanford University, studies the connections between people's outlook and their willingness to take risks. "The view you adopt for yourself profoundly affects the way you lead your life," she writes in her book "Mindset," which was published earlier this year. Dweck identifies two types of people: those who have fixed mind-sets and those who have growth mind-sets.

People with fixed mind-sets believe that they were born with a certain amount of intelligence, and they strive to convince the world of their brilliance so that no one finds out they're not actually geniuses.

Growth-mind-set people believe that intelligence, knowledge and skill need to be "cultivated" by trial and error. Failing at something, they believe, is the best way to ensure they'll succeed at it the next time.

Excellent! We meet people in the first category ALL THE TIME! The special ones are the ones in the second category. Those who are constantly growing, learning and becoming! It is also important to realize that it is okay to fail, just as long as you use it as a learning experience and keep on growing!

Never stop learning
Lesson 2, Corollary 1: Successful people are always on the look out for new experiences that they can later build on.

First I met Heidi Roizen, 48, a managing director at Mobius Venture Capital, a Silicon Valley firm with investments in the tech industry of around $2 billion. She's in the business of assessing risk, and I asked her if there are any lessons for the rest of us in the way she examines potential investments.

"Often when you mention risk, what people think of is the downside. Danger. That's not the entrepreneurial mind-set," she said. "The entrepreneurial mind-set is that risk is the heightened probability that there is a big range of possible outcomes."

Losing, she says, is no fun, but it's also essential to winning. When an investment doesn't work out as planned, Roizen analyzes her decision-making process to figure out what went wrong. She compares it to dissecting her performance after she delivers one of her frequent talks to Stanford M.B.A. students (building her network, as you've gathered by now).

"I usually spend a half hour telling my husband what went right or wrong," she said. "If I sit and think and talk out loud about what worked or didn't work, that becomes part of my psyche for how I figure out how to do the next lecture. I do the same thing in business."

Dweck, the psychologist who studies growth mind-sets, created an experiment to demonstrate how persistence and the pursuit of knowledge leads to success. She posed a series of trivia questions to a group of people with fixed mind-sets and another with growth mind-sets.

After each answer, one and a half seconds passed before the participants were told whether they were right or wrong, and, if they were wrong, another one and a half seconds lapsed before they were given the correct response. Their brains were monitored with electrodes the entire time.

Dweck found that the people with fixed mind-sets cared a lot about whether they were right or wrong but not at all about what the right answer was. The growth-mind-set participants stayed interested until the correct answer was given, showing an interest in learning new information rather than in simply validating their intelligence.

When the test was repeated right away, only the growth-mind-set group performed better.

Again, the focus is on growth and growing. Don't stop, keep going, realize that you can grow until the day that you die!

Their list goes on but these are the ones that we found to be very important. Each and every one of you has what it takes to be rich. We firmly believe this. It might take some time, you might make some mistakes at first, but that is okay. Keep striving, keep persevering, have a great attitude and put a smile on your face; your going to make it!

If your doing all this and still feel you need a little help, give us a call. Helping make people rich is one of the things we live for!

Insurance and Health Care

2006-09-14T10:54:00.000-06:00

Having good health is so very important. We have seen the other side of this issue as most of you know. That is one reason that we work so hard to insure that all of our employees have good health insurance. We try and offer the best available at an affordable rate. As employers, we see this as one of our responsibilities. Others seem to want to ignore it which is just wrong.

Individual health insurance — often touted as an alternative to employer-based group coverage — may be an option for the healthiest and wealthiest. But a study due out today suggests that the poor and sick need not apply.

The overwhelming majority — 89% — of working-age adults who shopped for health coverage in the individual market over the last three years were rejected for health reasons or found it too expensive, according to the study by the Commonwealth Fund, a private foundation that sponsors independent research on health and social issues.

Coverage was not affordable for 58% of the applicants, and 21% who had a medical condition were turned down, charged a higher premium or sold a policy that excluded the existing problem from coverage, the report said.

Individual insurance also is less affordable than employer-sponsored coverage, the study found. Two out of five people with individual coverage spent 5% or more of their income on premiums, compared with one out of seven people with employer coverage.

The study is the latest assessment of individual insurance, which is seen as an increasingly important form of coverage as employers drop health benefits for workers and their families because of the cost.

Most of the increase in the number of uninsured Americans — who now total, by some estimates, 46.6 million — was because of a decline in workplace coverage, said study author Sara Collins, an executive at the New York-based foundation.

This is just horrible. Here we live in the best country in the world with the highest quality health care and there are millions who can't access it. We are doing our part to make sure our employees are covered. If you are an employer, are you doing the same? This is part of living abundantly. Sure, we could make more money if we didn't offer health care, but what kind of scarcity mentality is that?!? Our employees are too important to us, they are like family.

This is an issue that we continue to watch. A solution for universal health coverage needs to be found, but it needs to be one that falls under the umbrella of abundance and not scarcity. We are confident that a solution is just around the corner, just waiting to be discovered. We are sure it will happen soon!

Fireman, Policeman, professional athlete?

2006-09-12T13:53:00.000-06:00

A little off the beaten path, but it is interesting to see what professional athletes make on average. A recent edition of Sports Illustrated went through the average salaries of athletes in various sports.

Here they are:

* Basketball (NBA) -- $5,000,000
* Baseball (MLB) -- $2,800,000
* Football (NFL) -- $1,750,000
* Hockey (NHL) -- $1,500,000
* Men's Golf -- $973,495
* Women's Tennis -- $345,000
* Men's Tennis -- $260,000
* Women's Golf -- $162,043

Interesting eh? So, when your child says they want to be a pro-athlete, at least you won't have to worry about them financially.

Now all they need to do is work with us so they know how to handle their money properly!

September 11, 2006

2006-09-11T10:01:00.000-06:00

Today we honor those who lost their lives in an incident that has changed us all forever. We mourn for those who lost loved ones. We salute those brave firemen and policemen who rushed in, knowing the buildings could fall at any moment. Our hearts are with the families of those brave passengers on flight 93 who vowed to retake their plane or die trying. Our prayers are with the soldiers who continue to fight for our freedom.

May God bless them all and everyone of us. Let us never forget what happened on that dreadful day. Let us learn from those events and live lives that help keep it from happening again.

God bless our heroes, those who have died and those who continue to live on, being shining examples for all of us. Who are those heroes? They are probably different for each of you, and that's fine. It's good to have heroes and we hope that each one of you has someone who you look up to that gives you inspiration.

Take care today and say a prayer or have a thought in your heart for those who have given their all either on this day or the days since.

DON'T pay cash for your home!

2006-09-06T11:28:00.000-06:00

Wow, we'll bet that headline shocked a few of you. Here we are, the biggest evangelists in the world for paying off your mortgage, and we are telling you not to go out and pay cash for your home. Why in the world would we do this? Well, the following article nailed a lot of the reasons why. We'll quote the parts we agree with.

(Q) DEAR BOB: I plan on paying cash for my next residence. Are there any hidden dangers in paying cash? -- Mark N.

(A) DEAR MARK: Please don't do that ...A better alternative is to pay a 20 percent or 25 percent cash down payment and obtain a fixed-rate 15- or 30-year mortgage for the balance of the purchase price. Then, just in case you have purchased a bad house or a bad condo, you won't have all your nest egg tied up. After a few years of owning and living in the home, if all turns out well, then you can pay off the mortgage. (Of course, be sure it doesn't have a prepayment penalty.)

I still recall a nightmare letter I received a few years ago from a retiree who bought her retirement condo for all cash. Only after moving in did she discover that the complex was badly managed and occupied by about 50 percent renters, who caused many problems.

When she tried to sell her condo, she discovered that mortgage lenders either refused to loan to new buyers or charged high interest rates because of the high risk with so many renters. The only way she could get her cash out was to sell to another all-cash sucker.

So there you have it. While we are huge advocates of paying off your mortgage, we are also advocates of being smart with your money. Unless you know everything about the home you are purchasing and the neighborhood where you are purchasing it, you are wise to give yourself some time before the big payoff.

Picking the Right Planner...

2006-09-01T14:10:00.000-06:00

Working single mom Kathy A. Gambrell has had no problem finding a lawyer to write her will or a certified public accountant to prepare her taxes -- professionals she found by asking friends and family for recommendations.

But a four-year quest to find a financial planner has left the editor of the District-based CongressDaily baffled, angry and, worst of all, unenlightened on how to find someone good to help her manage her money. Three weeks ago, she fired her latest adviser after he recommended she quit her job, fire her babysitter and yank her child from Montessori school -- then let him manage the money she would save, along with a small inheritance she's about to receive.

"As if!" says Gambrell, 46. "He had no idea what I was about."

This sounds far too familiar! We hear horror stories like this constantly from our clients. How can you find a planner that is out there for you and not for his own commissions! How do you know if the person is reliable? What are his/her qualifications? The list goes on and on and on and this article does a great job tackling the issues. Let's look at it some more!

Much of what makes hiring a financial planner so bewildering is the motley nature of the industry. There are more than 80 certifications or degrees advisers can place next to their names. Most were created since the 1980s, when financial planning came into its own, but only a few carry widespread recognition.

"It's a joke," says Ellen Turf, chief executive of the National Association of Personal Financial Advisors, an industry trade group. "Our goal is to have financial planning be a profession, but it's not quite there yet. We don't have a system like doctors or lawyers or accountants, where you know what to look for."

The absence of a uniform industry standard means that consumers must do their homework before they hire anyone. Experts say it is essential to know whether a prospective adviser accepts commissions that could influence which products he recommends. And equally important: Consumers should also ask whether that adviser is the kind that by law must put his client's profit ahead of his own. And consumers should check with federal and state regulators to see if that adviser has registered and whether he has been the subject of any recent complaints or disciplinary actions.

Can you believe that? For something that is so important, there is little organization. No wonder it is nearly impossible to find a reliable financial advisor! It gets even MORE confusing as we look further. Get a load of this next part!

As consumers wade through lists of prospective advisers, they will encounter many professional credentials. Three of the best-known designations are certified financial planner, or CFP; certified public accountant/personal financial specialist, or CPA/PFS; and chartered financial consultant, or ChFC.

Each of these credentials requires its bearer to complete an approved course of financial-planning studies, pass a certification exam and attain a minimum level of experience. But these designations, just as in any other profession, don't guarantee that someone is good or will act with your best financial interest in mind, consumer groups and government financial regulators caution.

As they look for a planner, consumers should remember two key legal designations created by the federal government. The first is that of registered investment adviser . With one important exception, this is anyone who charges money for giving advice on which securities to buy or sell. They must file as a registered investment adviser with state or federal securities regulators, and by law they are what is known as a "fiduciary." A fiduciary can recommend only those investments she believes are in your best interest -- even if she might make more money by selling you something else.

The second legal designation is that of stock broker , which the law defines as anyone who buys or sells securities for someone else. In general, brokers are not fiduciaries. They don't have to recommend a product that is best for an investor -- only one that is suitable. For example, three mutual funds might be suitable for you, given your investment goals and tolerance for risk. A broker could legally steer you to the one that will pay him a higher commission, even if its returns have not been as good as the other two.

To further confuse things, an adviser can be both a registered stock broker and a registered investment adviser. That means he or she could apply different standards at different points in your relationship, at times acting as a fiduciary recommending a mutual fund that will give you the best return, at others acting as a broker, recommending a fund that's suitable but perhaps a bit riskier.

An additional wrinkle was added last year, when the Securities and Exchange Commission decided to allow stock brokers, who traditionally have been paid with commissions and have given limited investment advice, to perform those same functions for a fee, without having to become fiduciaries by registering as investment advisers.

That decision angered many registered advisers, who argue that the policy allows brokers to appear to offer unbiased advice without in fact having to act in a consumer's best interest. One trade association, the Financial Planning Association, has sued the SEC over the issue.

Federal regulators, acknowledging the potential for confusion, require these fee-paid brokers to disclose potential conflicts of interest to customers. But a recent study by the SEC found that customers often don't understand such disclosures. The agency plans a larger study before it decides what to do next.

To cut through the clutter, Barbara Roper of the nonprofit Consumer Federation of America recommends that people hire a registered investment adviser. It provides an extra level of probability that the person will act in your best interest, she says.

Wow! Again, how do they expect the average joe to find what and whom he needs? Answer, they don't! You're dead meat if you go into this blind.

This next part is something that we discuss constantly and is the big reason why you just can't trust so many of the so-called 'financial advisors.'

Advisers can be paid with fees, commissions or a combination of both. Someone paid by commission -- for example, by a mutual fund or an insurance company -- is acting as a salesman. Someone paid only a fee is acting more like a lawyer, charging you for his time and expertise; he will not make more money by steering you towards one product over another.

The commission system still appeals to many consumers who can't afford or don't want to pay upfront fees, says Robert E. Plaze, associate director in the SEC's Division of Investment Management. But clearly, experts say, the popularity of fee-based services is growing.

In the past, fee-only planners tended to cater to wealthier clients, charging a rate that was a percentage of assets, usually about 1 percent a year. Clients often had to have assets of $1 million or more.

BINGO! There you have it. Most of the advisors that are available to the average person make a commission. Because they are making a commission they are NOT working on your behalf!

That is one area that we focus heavily on, teaching you how to invest. We'll never tell you what to invest in. We'll never give you a 'hot' stock tip. We won't tell you which companies to use or not use. What we will do is give you the knowledge needed to make your own, intelligent decisions.

Now, take a deep breath, go out and have a great and abundant day! Give us a call if you'd like, we'd love to talk with you!

Dumpster Diving

2006-08-31T13:45:00.000-06:00

It is amazing how much publicity has been given to Northwest Airlines over their employee guide to dumpster diving.

They will be regretting that pamphlet for years to come.

Here is what we had to say about it.

Who Needs a Shredder? EVERYONE!!!

2006-08-31T11:59:00.000-06:00

This is just so true. You don't think about it, but with all the problems with identity theft, a shredder is really just as important as a stapler, pens, pencils and any other item in your office or at home.

Fellowes, Inc., a major shredder producer, has recently put out a series of ads targeting college students and their need for a shredder. While at first this might seem laughable, the more you think about it, the more realistic it seems.

Here's some of what the company said in a recent e-mail release: "Credit card offers, communal dormitory garbage cans and unsolicited mail make college campuses an identity thief's dream," said Kristen Gehrig, senior marketing manager at Fellowes. "It's frightening how careless college students can be with their personal information. However, by shredding personal documents before throwing them away, college students can significantly decrease their risk of becoming a victim of identity theft."

They nail it. While it might seem trivial, it really isn't. We can't think of a bigger hassle for a college student than to have their identity stolen. They have enough on their minds with school, studies and other realities of college life.

Today, shredders are incredibly inexpensive and while a bit cumbersome, not too bad. Especially if you purchase one that fits on top of a waste basket, they are smaller and easy to move around.

If in the end, your student just doesn't want to take one with them, make sure they understand how important it is that they destroy anything with personal information on it that they are throwing away. They should also thoroughly destroy any mail received that offers them credit cards, loans or anything else dealing with financial things or money. While it might be a very small percentage that have their identity stolen, you just don't want to be part of that statistic. Destroying your information makes you a much smaller target, they are looking for easy marks because there are so many of them.

IRS Getting Tougher on Charitable Donations

2006-08-30T12:32:00.000-06:00

We believe that part of living an abundant life is being charity minded. We believe in supporting those in need and helping where we can. That is why we felt it important to pass on the following information about charitable deductions and the IRS.

The bottom line: Where the government once was willing to trust that you weren't padding the deducted value of small gifts, now you're going to need proof that you gave something — and something of real value — if you want to deduct it.

"I don't know if the Salvation Army kettle people are going to start giving receipts, but that's essentially what would be required if you wanted to claim the dollar you contributed as a deduction," said Mark Luscombe, principal tax analyst with CCH Inc., a Riverwoods, Ill.-based publisher of tax information.

Under current law, taxpayers are largely taken at their word when claiming $20 placed in the church collection plate, or the relatively minor amounts of out-of-pocket cash that they might throw into the Salvation Army's annual Christmas kettles.

Documentation has been required only for a donation of $250 or more. But, if audited, taxpayers are expected to supply a written record of how much they gave and to whom.

The new law, however, requires that taxpayers have a receipt or canceled check for every monetary donation. A taxpayer's written record is no longer enough.

So, make sure you get that receipt and keep it! It is important to give to charities that you support, but it is also important to be fiscally responsible. You can still give to your favorite charities and organizations. It is just important that you make sure your records are up to date and include the required items.

More Foolish Investing

2006-08-29T17:14:00.000-06:00

We read these articles and sigh and sigh again. Why don't people open their eyes and learn how to invest properly? Get some training so you won't make these foolish, amateur investing errors!

The most recent article deals with crisis investing. A crisis happens, some company seems to have the solution, and people, thinking this company is the next microsoft, invest heavily. After a short time, reality hits, everyone realizes that company is more like Enron and those 'savvy' investors just lost everything they put in the company.

Here is a real world example.

The recently thwarted plot in Britain to blow up airliners headed for the U.S. was chilling news that put the world back on high alert. But with the fear - for many investors, anyway - came the search for opportunity.

Some evidently found it in a Bloomberg.com article about the newly apparent dangers of liquid explosives. Buried near the end was a reference to a New York-based start-up called TraceGuard Technologies (Charts). The company has developed a machine that it says can detect chemicals used to create explosives hidden in carry-on luggage without opening the bags. The wee bulletin-board stock - its market cap didn't crack $19 million - spiked up 64% on the mention.

Not bad for a company whose product doesn't exist except in prototype. The machines aren't in any airports and aren't likely to be there anytime soon - they don't have federal approval. Within days reality returned, and TraceGuard's shares plummeted right back to where they'd started.

OUCH. How foolish would you feel if you invested at that 64% spike? If that was you, you took one in the shorts!

Here is another example along with a good explanation of why so many fail at this kind of investing.

A lucky few may have bought and sold at exactly the right moments, earning themselves a bunch of cash and bragging rights at their next barbecue. But the more likely result for an investment in such a stock was a lot less glamorous.

And that is the peril for those who seek opportunity in calamity. Crisis investing may seem savvy, but for most individual investors it's a slightly ghoulish version of stock market gambling.

For starters, information travels too quickly and too widely these days for the average investor to get a leg up after a news event. "Things get priced into stocks very quickly," says Dirk van Dijk, research director of Zacks Investment Research.

And often as not, investors have some information, but not the full picture, says Pete Morici, an economist and professor of business at the University of Maryland. "Crisis investing is extremely difficult for the average investor, who doesn't have the ability to quickly find other information about the consequences of an event."

He cites the Gulf Coast hurricanes as an example: "People grossly overestimated the immediate rebuilding effect of Hurricane Katrina." Some stocks popped - Shaw Group (Charts), an engineering and construction firm, jumped 46% in the two weeks post-Katrina - but more languished.

For example, investors piled into Bermuda-based PXRE Group (Charts), a reinsurer some thought would gain from the higher premiums that often follow disaster. But they were treated to their own storm last February when PXRE's operating units were downgraded by rating agencies after the company reported higher-than-expected hurricane-related losses. The stock tanked by nearly two-thirds in one day and now trades around $4.

An investor that is properly educated wouldn't make these foolish mistakes. These are some of what we teach, how to make wise decisions. We'll never tell you what to invest in, but we will teach you how to invest properly.

Here's hoping you never fall into one of the traps shown above! Have a great and abundant day!

Social Security -- 5 costly mistakes

2006-08-28T17:26:00.000-06:00

We've always taught that you should never count on Social Security for your retirement unless you want to live below the poverty line in complete squaller. Reviewing what this blogger has written just reinforces that thought. What he has written though is well worth reading.

Author James Mahaney recently emailed me a piece he co-wrote titled Innovative Strategies to Help Maximize Social Security Benefits. Part of this document lists the five costliest mistakes retirees make about Social Security. Here's the list and my comments on each point:

1. Underestimating the real value of Social Security. Key quote: "Some never take charge of this benefit [Social Security] because the discount the viability of the system in general. But whatever your personal beliefs are about the Social Security reform debate or a 'pay-as-you-go system', most new retirees have been paying into the Social Security system for many more years than they have contributed to their Defined Contribution plan. They can count on both as critical sources of retirement income."

Hey, is he talkin' to me? ;-)

I'm not going to ignore Social Security when I get to the age to "manage" it, I just have a hard time believing that it will be worth much in 25 years. I guess we'll see.

2. Rushing to collect, then regretting the reduced benefits for the rest of your life. Key quote: "And most [retirees] certainly didn't stop to think that they could potentially double their initial payments if they only waited until age 70."

I'm planning to wait as long as possible before drawing whatever Social Security has for me -- that's one advantage of not counting on it for anything (and saving myself accordingly).

3. Not understanding how one spouse's decisions affect the other one's benefits. Key quote: "In essence, the value of delaying Social Security 'lives on' as the higher benefit is passed on at death to a spouse. This is a wonderful way to protect a spouse from running out of money."

Good information here -- I never knew this. If you're close to retirement, you HAVE to read this piece.

4. Getting blind-sided by the "Tax Torpedo". Key quote: "The tax situation for the retiree is often worse than expected. Once a very low income threshold is met, every dollar received from an IRA causes up to 85% of a Social Security dollar to become taxed too."

Yikes! I had (mistakenly) thought that taxes would be much more of a non-issue in retirement. Guess again, huh?

5. Assuming that more control equates to more income. Key quote: "The inability to delay 'ownership' of their Social Security benefits may cost many retirees dearly."

Another great point -- and one that shouldn't be missed.

Like we have always said, you should never rely on Social Security for your retirement. These points above just add to our concerns. It is important for each one of you to take control of your finances and plan for the day when you no longer wish to work, or, if you plan to work forever, for that day when you slow down just a little.

For many of you, thoughts of retirement might seem to be so far off as to be unthinkable right now. It's time to change that thinking. Plan for everything and start right now!

Of course, we are always there to help!

Double and Triple Check

2006-08-24T11:19:00.000-06:00

This is a bit outside our normal blogging, but it showed just how important it is as an employer to check everything. It doesn't matter if you have one employee or thousands, check everything!

The financially struggling Northwest Airlines recently made a blunder that could easily be viewed as a sequel to "Snakes on a Plane."

The Eagan, Minn., company, which is in the midst of bankruptcy reorganization, did something that was as biting to some of its employees as the plane full of poisonous snakes in the recently released movie.

To help prepare employees for possible job losses or transitions, Northwest sent out a 165-page handbook titled "Ground Operations Restructuring Q&A and Employee Support."

The guide included information on pension and retirement benefits, relocation and résumé assistance, said Roman Blahoski, media relations manager for Northwest.

Now, this isn't bad so far. The company is struggling and knowing it is going to either fire some employees or severely reduce their salary, it is trying to help them get ready. What followed next is what was so appalling.

Northwest rattled some employees because of one section in the handbook, "Coping With Job Loss." In that section was a list of "101 Ways to Save Money" that was not reviewed by Northwest management, according to Blahoski.

Now, remember, this was given to employees, some of whom might be losing their jobs by no fault of their own. Here's some of what they were told:

· Buy spare parts for your car at the junkyard.

· Get hand-me-down clothes and toys for your kids from family and friends.

· Take a shorter shower.

· Buy old furniture at yard sales and refinish it yourself.

· Volunteer two hours a month at a food-sharing program to get reduced-cost food.

· Hang clothes out to dry.

· Borrow a dress for a big night out or go to a consignment shop.

· Ask your doctor for samples of prescriptions.

· Don't be shy about pulling something you like out of the trash.

Excuse me? You are a company that is failing financially and you have the gall to tell a former employee to go dumpster diving? What could they have possibly been thinking?!?

They also gave some ridiculous tips that, if you don't know a person's exact financial situation, could cause more harm than good.

For example, tip No. 41 said, "Refinance your mortgage." What? When was this list prepared? Although dipping a bit lately, mortgage rates have been seesawing all over the place and have mostly been rising.

Another tip (No. 44) said to convert your cash-value life insurance to term. That one-sentence suggestion needed far more explanation. I certainly wouldn't recommend this without explaining the pros and cons.

What if employees had just bought a cash-value policy? It's probable they would encounter a huge surrender charge. A surrender charge is what you have to pay if you withdraw money or cancel the policy within a certain period after your purchase (typically within six or eight years, but sometimes as long as 10). The policyholder could also trigger a tax hit on earnings. That, too, wasn't explained.

The list also advised people to trade in their cars for less-expensive, lower-maintenance ones. Okay, but what if you're upside-down on your car, meaning you owe more than the car is worth? Trading in a car in such a situation would cost an employee more money.

Tip No. 87 said to donate time instead of money to religious organizations and charities. Well, what if you believe in tithing?

As employers ourselves, it was a good reminder of what can go wrong when something is put out in your name that you didn't review. We're sure some heads are going to roll over this kind of blunder!

BEST RADIO SHOW EVER!!!

2006-08-21T12:52:00.000-06:00

At least to us it was.

We were down in Florida to do a video shoot and had to do our show from there. We decided that since we were in such a lovely place, it would be a great time to have some of our students come spend some time with us. We then interviewed a bunch of them on the show.

So, if you are curious about us, about our Institute and about our students, DON'T MISS THIS SHOW! It gives you all the information you could ever want about the Smith and Merritt Institute.

Download it here!

What are you waiting for?

Top 10 Lies Financial Advisors Tell

2006-08-16T12:48:00.000-06:00

While reading some other blogs, we ran across this wonderful piece.

What passes for investment advice is a pack of lies being told by a band of thieves. They keep telling the lies because you keep buying them. Here are ten perennial favorites, in no particular order:

Ah, reading this brought a tear to the eye. Another who understands that seedy underbelly that is the world of financial advisors. This group oozes their way to the feeding trough of 'eager but clueless' people who think they are making good decisions and actually brag to others about their use of gutterspawn, otherwise known as 'financial advisors.' Anyway, let's continue with this wonderful article and look at some of the points she makes.

3. "Options are risky." Options can't be inherently risky. For every transaction there is one winner and one loser. The problem is not with options but with the way people are taught to use them.

4. "The S&P will be at x by year-end." Stock prices are random. No one can accurately predict where they will be tomorrow, next week, or next year. No one can consistently pick tops and bottoms either. It can't be done - except by liars.

5. "You can afford to take more risk while you are young." The days of being able to take market risk are gone forever. We now live in a world where we must all fund 30+ years of retirement. Capital losses, at any age, are no longer acceptable.

6. "Our analysts believe this company has great potential." That would be great if stock prices actually reflected the true value of a company. They don't.

The whole time reading this, we just kept nodding our heads in agreement.

Take the time to read the entire article, you won't be disappointed!

Government Employees not Ready to Retire

2006-08-15T16:55:00.000-06:00

Reading this article, we were not surprised. It's like the rest of the nation, people aren't ready to retire. People aren't taking it seriously enough and will find themselves in a world of hurt when it comes time to quit, most will find themselves back in the workplace!

The OPM survey also found that fewer than half of the respondents had calculated how much they need to save for a comfortable retirement and that almost four in 10 said they were not confident in their ability to make investment decisions.

The survey grew out of a request by Congress for more information on retirement planning by federal employees and possible steps to expand retirement education programs. The request reflected a broader concern that most Americans do not save enough for retirement, may be failing to diversify their portfolios and may need help in calculating how much to save for retirement.

This is so true. People have no idea how much money they need to retire. So, not only are they not saving enough to retire, they don't even know how much they need!

Again, this is one of those things that we teach our students. As we have said so many times, knowledge is the key! It's impossible to live abundantly when you don't have the knowledge!

Take the time to give us a call, let us help you. We've made a free offer before and we want you to know that it still stands! Go here to read about it and give us a call. When you call us, use the special number reserved for our blog readers. That number is: 888-221-9394. Again, that number is ONLY for our blog readers and allows them to work with us for free!

2nd Radio Show

2006-08-14T17:31:00.000-06:00

Well, our 2nd Radio Show went off without a hitch this past Saturday. We are having a BLAST! We didn't realize how much fun radio would be. This week, we took some callers as well. We really think the show went well. If you didn't have the chance to listen to it live, please download the podcast of it here. We would love to have your feedback!

Be Careful of so-called 'Financial Advisors'

2006-08-14T16:17:00.000-06:00

The following interested us only because of the answer in comparison to what we have been preaching for so long. This comes from a question and answer column in the financial section of the Washington Post.

Q: DEAR BOB: I began getting Social Security last February and 15 months later I lost my job. A financial adviser suggests I take a reverse-mortgage lump sum and invest it to supplement my Social Security income. I have no other income and no heirs. My home is worth about $400,000 with a $77, 000 mortgage at 4.25 percent interest, which adjusts by 2 percent next year. I like my home and want to stay here as long as possible. Do you think a reverse mortgage will work for me? -- Loral C.

A: DEAR LORAL: Yes, but I am worried that that financial adviser might have suggested you take a reverse mortgage lump sum so he can sell you an annuity or other investment to earn himself a large sales commission. If you want to receive monthly lifetime income from a reverse mortgage to supplement your Social Security income, you can elect that choice directly from the reverse-mortgage lender...

Most of your 'financial advisors' are not advisors in the true sense of the word. A true advisor is there for you and only you. He is looking out for your interests, not his own. This is not the case in the world today where 99% of financial advisors make their money by selling you something! They are looking out for themselves, NOT YOU! The more they can get you to buy their products, the more money they make. It's a sad sad situation.

It is because of this that we don't sell products. We want to be able to offer true, unbiased, financial advice. We couldn't do that if we represented some financial organization. All we want to do is educate you and allow you to make your own decisions when it comes to investments.

So, when you meet a 'financial advisor', find out who he is working for and then see just how many products from that company he offers you. Then hold on to your wallet and run!

Your Child's College Fund; Congress Gives You Some Help!

2006-08-14T13:06:00.000-06:00

Let's give congress a quick round of applause, something we rarely do! They have now made 529s permanently tax-exempt! Before you start asking all sorts of questions, read the following:

Before members of Congress left for their summer break, they gave parents, grandparents, aunts, uncles -- anyone trying to save for a child's college education -- a welcome break.

Included in the Pension Protection Act -- passed by the House and Senate and expected to be signed by the president -- was a provision to give permanent tax-exempt status to college savings plans known as 529 plans.

This is a significant development for plans intended to help pay for the ever-escalating cost of a college education.

The 529 plans many people invest in now weren't always so tax-friendly. Before 2002, if you invested in a 529, earnings grew tax-deferred, but when the money was withdrawn it was taxed at a child's rate.

But state-sponsored 529 plans gained federal tax-exempt status in 2002. The change allowed contributions to grow tax-free, and earnings became sheltered from federal taxes as long as the money was used to pay for qualified higher education expenses.

This favorable tax treatment was scheduled to expire on Dec. 31, 2010. Had it expired, the tax benefit would have returned to its pre-2002 status.

A 529 plan operates similarly to 401(k) retirement savings plans. States, like employers, arrange for an investment company to set up and manage their 529 savings plans.

Again, kudos to congress! Now let's hurry and get our debts paid off so we can all start investing in these type of plans!

Debt Consolidation can CREATE more debt!

2006-08-14T12:26:00.000-06:00

This is one of those things that some people don't realize. When you work with a company that consolidates your debts and negotiates your credit card bills down, you can actually be creating even more debt and this debt isn't one that is going to be forgiven!

If you're working with a creditor to forgive some of your debt, there's something important you should know.

Any debt that is canceled could create another bill -- a tax bill.

"I am a tax preparer with a very large tax preparation company and have had to deal with unhappy taxpayers who are upset to find they have a tax liability they did not expect," said Larry Cohen, a senior tax adviser at an H&R Block office in Wheaton.

Cohen's remarks were prompted by a recent column I wrote about whether debtors should accept a settlement. That column was the first of several on the issue of debt collection. This second installment deals with an important downside of debt dealing.

Cohen remembers one client he tried to help after her consulting business failed. The woman had been living on her credit cards and eventually amassed about $30,000 in debt. She was able to negotiate that debt down to about $10,000, Cohen said.

But the cancellation of debt created a $5,000 federal tax bill.

"When I told her she would have to pay taxes on the $20,000 that was forgiven she was absolutely flabbergasted," Cohen said. "She was just completely upset. She just ran out of the office. She didn't even pay me."

This is just one example of the many pitfalls that can happen when you are trying to pay your debts. That is why we stress education so hard. You must become educated, you need to understand the world of money and money management. It is one of the most important things that we do, we teach. We teach about money and all aspects of earning it, saving it and spending it.

Take the time to educate yourself, it is one of the most important things you will ever do!

It's Friday!

2006-08-11T12:57:00.000-06:00

Here's wishing you a great weekend.

We have some wonderful video of the radio show. We've been working to edit it so we can put it online for you to see. The biggest problem is that the video camera didn't have great sound pick up so we're matching up the video with the podcast. As soon as it is ready, we'll have it up for you to listen to!

Again, have a great weekend and don't forget to listen to our radio show tomorrow morning!

Find out more about it here.

Best Credit Card for your College Student...WHAT?!?

2006-08-10T15:27:00.000-06:00

Okay, we did a double, then triple, then quadruple take when we read that headline. (hattip) We could not believe it! This shows just how far we've gone when we are actually talking about credit cards being good for someone. We were disgusted!

Laptop, iPod, a messenger bag and yes, a credit card - all the staples of modern college life. Nowadays, owning a piece of plastic has become as much as part of the college experience as griping about the dorm food.

In fact, over three-quarters of all college kids have a credit card, according to a recent study published by the student loan firm Nellie Mae.

GAHHHH!!!! This is just wrong wrong wrong! A credit card shouldn't be a part of college life. If we do this, we are just throwing our kids under the bus of debt. The only good I can see in the above is 1/4 of students DON'T have a credit card. Congratulations to them!!!

Parents and students should also realize there are plenty of issuers out there that are looking to make a buck off the financially naive, including college kids.

NO! REALLY?!? Credit card companies actually take advantage of people and would take advantage of our youth?!? DUH! How long will it take for people to realize that these companies are EVIL. They will take advantage of ANYONE, young, old, competent or not, they are only out for their next dollar. GET THIS THROUGH YOUR HEAD!!!!

YOUR CREDIT CARD COMPANY IS NOT YOUR FRIEND.
YOUR CREDIT CARD COMPANY IS NOT YOUR FRIEND.
YOUR CREDIT CARD COMPANY IS NOT YOUR FRIEND.
YOUR CREDIT CARD COMPANY IS NOT YOUR FRIEND.
YOUR CREDIT CARD COMPANY IS NOT YOUR FRIEND.
YOUR CREDIT CARD COMPANY IS NOT YOUR FRIEND.

We would say this 100 more times if we felt it would make a difference. We hammered this on our radio show. We discuss this during our seminars. Our financial advisors who work with our clients drill this constantly. We beg of you to listen!

Get out of debt. Get your credit cards cleared off and never carry a debt on them again!

First Radio Show

2006-08-10T14:05:00.000-06:00

Well, our first Radio Show went off without any major complications! It's only an hour long which we are finding is just far too short of a period of time for us, we have a lot to say.

If you want to hear the first show, download it here. It is the August 5, 2006 show. Let us know what you think! Also, feel free to send us a question or two if you have them. We promise that we will get to them in future shows. Plus, when you ask us questions, it helps us get ready and select topics to speak on.

So hurry up and speak up!!!

Wow!

2006-08-10T13:51:00.000-06:00

Hey folks, just wanted to apologize, it has been far too long since our last post. We have been busy, busy, busy! Look here for some video of our first radio broadcast to come soon!

And you wonder why we say be careful when getting a mortgage?!?

2006-08-04T13:09:00.000-06:00

Reading some of our favorite blogs, we can upon this story which exemplifies why we are so fanatical about being careful when purchasing a home!

Want a real-life example? The U.S. News piece titled "Mortgage Roulette" details a couple who got into a bad mortgage like the ones noted above. Here's their story:

Melvin lacked the cash for a traditional 20 percent down payment. Nor did he have the income needed to qualify for the best rates on a conventional fixed-rate loan. So a mortgage broker steered him toward what's known as an 80-20 loan package: an interest-only mortgage totaling 80 percent of the new home's $257,000 price, combined with a home equity line of credit to cover the 20 percent down payment.

The mortgage's 5.65 percent rate is fixed for the first five years, keeping Melvin's monthly payments low. But the credit line's floating rate has since ticked up by more than 3 percentage points, increasing his tab by about $100 a month. And with the chance that his total monthly payments could eventually double, he wonders if he should bite the bullet and refinance now. (For Melvin, it's a monthly payment that could double to about $2,500 when it resets.)

HELLO?!? We want to say, "What kind of stupid, ignorant MORON would sign this kind of mortgage?!?" We want to say that but we realize that this type of situation is far far too common with some of the slick, slimy mortgage brokers out there who just don't care if you lose everything in 5 years as long as you sign that mortgage. Scumballs.

Melvin is in some SERIOUS trouble. Doubling your monthly payment? Just how many of you could afford that on top of your other bills? Basically this guy purchased a home way out of his league and while he might have done this on his own, we have a hard time thinking that someone wasn't prodding him along.

Another interesting stat:

Over the next four years, about a quarter of all home mortgages will undergo a rate reset--almost certainly upward--on approximately $2 trillion in mortgage debt, according to estimates by the mortgage data firm LoanPerformance.

WOW!!! I hope you are all looking at that! It makes you wonder what this is going to do to the housing market? Just how many of these homes will end up being foreclosed on? How many families are about to be devastated?

Folks, we have counseled, talked about, pushed, prodded and shouted from the rooftops about this issue. Now, it is coming to a head. Sure, some will be okay. Some will be able to refinance and be just fine. Unfortunately, too many abused interest only mortgages and ARMs and are now in trouble. Let's hope the bleeding isn't too severe.

Starting Your Own Business

2006-08-03T14:31:00.000-06:00

We believe EVERYONE should have their own business. That's right, everyone! So, we were interested in reading the following article about starting up a business.

What attributes suggest someone's a good candidate to start their own business?

A college degree doesn't hurt — though dropping out didn't stop Bill Gates from launching the world's biggest software maker. Being rich would solve the problem of start-up financing — yet Sam Walton got his start in business on not much more than a wing and a prayer.

There are no definitive answers, but the entrepreneurs, private investors and academics USA TODAY's Jim Hopkins talked with suggested these experiences, traits and skills.

This is fine and good, but like they say, there is no definitive answer. We believe that EVERYONE is a good candidate to start their own business, all they need is a bit of help in some instances.

Family support

Prepare for crazy-long hours, including weekends, during a company's start-up phase — a work load that's also taxing for an entrepreneur's family. And vacations? What are those? About two-thirds of small-business owners said they planned to take a vacation of a week or more this summer, but more than half planned to check in with their companies at least once daily, American Express found in a survey. "Starting a business can require 80-to-100-hour weeks," Mark Ciavarella, an assistant management professor at Bucknell University, said in an e-mail. "Many spouses/partners don't understand this and won't tolerate it." As start-up adviser Ralph Sherman of Createabank near Detroit said, you know you're an entrepreneur when "your family has been looking for your picture on a milk carton."

Of course, we believe family support is important in whatever you do. Just remember that you don't have to start the kind of business they are talking about here. You can start one in your spare time, it can be like a hobby. Don't let the above scare you!

Money doesn't motivate

Two of the USA's most famous entrepreneurs — Bill Gates at Microsoft and Warren Buffett at Berkshire Hathaway — are also the two richest Americans. But they were driven to create great companies, not just huge fortunes. Indeed, Gates and Buffett are combining their riches to create a $60 billion philanthropic powerhouse in the Bill & Melinda Gates Foundation. "Entrepreneurs are much more interested in 'wealth' rather than 'riches,' " says Scott Laughlin, director of the University of Maryland's tech entrepreneurship program. Riches are piles of money, he says; wealth is broader, encompassing less-tangible rewards such as respect and independence. So, would-be entrepreneurs need to examine how they expect to be rewarded. "If the compensation is just cash," Laughlin says, "then the practice of entrepreneurship will not be very rewarding."

BEAUTIFUL! Just beautiful and very well put. Wealth is so much more, it is abundance, that is what they are really talking about, they just don't know it! It's all about having the right mentality!

Passion

You don't just think you've built a better mousetrap — you feel it in your gut, and know the world will be much better if only you can get your idea to market. "When something is important to you, then you know it with your heart as well as your brain," says Bob Barbato, a management and entrepreneurship professor at Rochester Institute of Technology. "You infect others with your passion, and they believe in you."

We've mentioned this before as well! Passion is so very important. More than just enthusiasm, you must have a passion for what you are doing!

Strong ethics

Start-ups depend heavily on good first impressions when entrepreneurs hire employees, court investors and line up customers. In a hyper-competitive economy, any whiff of dishonesty can deep-six a new enterprise. Penn State University's Anthony Warren, who advises venture capitalists, says honesty and trustworthiness are high on the list of attributes he looks for when he considers recommending a venture to potential investors. "Who wants to be in business with someone you cannot fully trust, especially in the start-up phase where the stress levels are high?" says Warren, director of the school's Farrell Center for Corporate Innovation and Entrepreneurship. The founders of Google, Sergey Brin and Larry Page, famously created a "don't be evil" mantra when they took their online search giant public.

YES! Another very important aspect and something that is sorely lacking from much of the business world today. HONESTY, HONESTY, HONESTY!

Tenacity

Sometimes the best business ideas fail to take hold — not because there isn't demand, but because the start-up was undercapitalized, or the entrepreneur lacked management know-how or simply gave up too soon. "If you really believe in it, you keep fighting for it," says Earl "Butch" Graves, president and CEO of Black Enterprise, the magazine founded by his father, Earl Sr. One-third of new small employers fail within two years; and 56% are toast after four years, says the Small Business Administration. About 672,000 small employers launched last year — but 545,000 others closed, the SBA says. A nobody entrepreneur who started a variety store in Arkansas in 1945 eventually lost the business when his landlord wouldn't renew his lease. But he didn't give up. "I've never been one to dwell on reverses," Sam Walton recalled in his autobiography, "and I didn't do so then." The company he fought to start, Wal-Mart, is now the USA's biggest private employer, with more than 1.3 million workers.

Very important! Stick with it and don't give up at the first sign of difficulty!

We didn't cover all the subjects in the article, just highlighted those we felt most important. Again, we want to state that EVERYONE should have a home business. You don't have to be the next Bill Gates, but who knows, you just might be the next Sam Walton!

Financial Planners to Give Free Advice

2006-08-03T13:54:00.000-06:00

Consumer credit is at an all-time high; personal savings is at an all-time low. Stock, bond and real estate markets all look volatile and dicey. Meanwhile, new and increasingly complex financial products are being created at a rapid clip.

There's no question that consumers could use professional help to make sense of it all, but only a tiny fraction of Americans seek assistance from financial planners.

All true. Most people could use help in making financial decisions, the biggest problem is that most of these financial planners have an agenda, lining their own pockets by selling you their products.

The article tries to give reasons why people don't get professional advice:

Some are blinded by misperceptions, such as believing that financial planning is only for the wealthy. And many are cynical of those providing advice because a lot of financial planners have products to sell that might taint their suggestions.

On Friday the Certified Financial Planner Board of Standards will conduct an experiment to see whether they can break down those barriers.

The board will bring together more than 100 financial planners at the Los Angeles Convention Center to provide a full day of free, one-on-one financial advice for anyone who wants to attend.

"There are no strings attached, but no one believes it," Teslik said. "We have sessions on financing college, getting started when you first go out on your own, handling financial issues for a small businesses, personal finance for Latinos — and we've got the world's leading expert on mutual funds talking about how to decode them."

There will be room for thousands of people to attend. At last count, only about 500 had preregistered.

The planner board is spending $2 million of its $15-million annual budget to sponsor the conference and bring in dozens of speakers, including Queen Noor of Jordan, former U.S. Sen. Bob Kerrey (D-Neb.) and Pfizer Inc. Chief Executive Hank McKinnell.

"We would have no problem, if we were giving away beer," she said. "But, nobody believes we have nothing to sell."

That last line is what is the biggest problem. While, at this seminar, they might not have something to sell, if you go see them at their office, they most certainly do have something to sell. People are tired of getting tainted advice! Still, this seminar might be interesting to attend if you are in the LA area. We would most likely go and help if we were in the area. The speakers are certainly worth going and listening to!

"We've got a couple hundred volunteers, sitting at tables," Teslik said. "People can walk up, and ask any question, get the answer and walk away. They don't even have to give their name."

Planners will not be making recommendations on individual stocks or touting insurance or mutual funds. The volunteers are prohibited from trying to sell or market any service during the event.

"We are not even letting participants give out their business cards," she said. "If the consumer wants to get a list of participants later, they can. But, they'd have to come to us. There is no selling here."

The afternoon will consist of a series of break-out sessions. Some are inside-baseball with planners speaking to planners. Others are geared to the public, providing primers on mortgage loans, mutual funds, budgeting and investing basics.

With these rules in place and being strictly enforced, we would certainly endorse this seminar and urge all to attend! Remember though, if you go, ask your questions multiple times and see the variety of answers that you receive. Write them down and don't be afraid to challenge the 'experts' that are there! This is one of the few venues where it seems you will actually be able to get some good, unbiased advice. We'll be fascinated to see how this turns out!

Read the rest here.

Artists Find Way to Make Ends Meet

2006-08-02T15:53:00.000-06:00

We applaud these artists for finding a way that allows them to follow their dream and make money at the same time. Part of living abundantly is doing something you enjoy doing. With the right mindset and doing what you enjoy, a way will come to allow you to make what you need.

Being a struggling artist isn't what it used to be. In fact, it might be worse.

Andrew Falkowski thinks so, and it's easy to understand why. The suburban Chicago resident and his wife have a combined five art degrees and six figures in debt because of them.

"Van Gogh was simply broke — he didn't have $100,000 in debt," says the 32-year-old Falkowski, who makes text paintings but works weekdays as a medical receptionist to make ends meet. "We all should be so lucky."

Mostly self-employed or relying on part-time teaching jobs, many artists tend to have shaky finances and scant prospects for improving them aside from going into another profession. But some institutions have sprung up in recent years to try to help — and ideally thrive financially at the same time.

Artist Pension Trust, Creative Capital and Fractured Atlas are among the options for artists with talent but limited wherewithal to pursue it. They offer creative workers financial education, career planning help, health insurance — even some steady income.

The Arts seem to be such a touchy subject today, especially here in the US. In many nations, they arts are far more heavily subsidized than they are here. It is hard sometimes to watch some truly talented people struggle as they try to make a living doing what they love. This group seems to have found an answer by working together.

Read the entire article to see how they have creatively worked together to overcome their problems.

Employees forced into 401(k)s

2006-08-02T11:59:00.000-06:00

We found this article to be quite interesting and a bit disturbing. The disturbing part is just how many employees aren't taking advantage of their companies 401(k) plans!

Shannon Scrivens discovered a surprise in her paycheck earlier this year: It went down.

But the mother of four was happy with the modest pay cut, because the money she missed was going into a retirement savings plan.

"I noticed that the 401(k) appeared one day in my pay stub and I was thrilled with it," said Scrivens, 35, as she took a break from her loading-dock job at a sprawling Costco warehouse near Washington Dulles International Airport.

The savings, she said, "is our only nest egg for retirement."

Scrivens is among a growing number of workers whose employers have steered them into retirement savings plans without waiting for them to sign up. The practice, known as automatic enrollment — or, to some workers, "forced saving" — is a tradition-breaking effort to push people into putting money away for the future.

Under a pension overhaul bill that the House approved Friday and the Senate is due to take up this week, companies would be granted explicit legal assurance that they could unilaterally shift some of a worker's pay into a retirement savings plan, such as a 401(k) program, unless the employee specifically opted out.

So, these workers aren't actually forced into this, they can opt out. But what they have done is forced people to face the issue of retirement and if they have done anything towards preparing for that day. It is amazing how many have just ignored the issue.

For workers in the bottom quarter of the wage scale, savings plan participation rates have jumped from as little as 42% to more than 90% after automatic enrollment was introduced, according to an analysis by the Employee Benefit Research Institute and the Investment Company Institute.

That is amazing! It's also good for this nations future. We all know what a joke Social Security is and this just might be one of the ways to keep our nation from becoming overrun with people who just don't have enough money to survive when they are older.

Blogger Goes to Jail

2006-08-02T11:36:00.000-06:00

While way outside out normal subjects, being bloggers ourselves and part of this great blogosphere, we felt it important to post on this and pass along our support of this young man.

A freelance journalist and blogger was jailed on Tuesday after refusing to turn over video he took at an anticapitalist protest here last summer and after refusing to testify before a grand jury looking into accusations that crimes were committed at the protest.

The freelancer, Josh Wolf, 24, was taken into custody just before noon after a hearing in front of Judge William Alsup of Federal District Court. Found in contempt, Mr. Wolf was later moved to a federal prison in Dublin, Calif., and could be imprisoned until next summer, when the grand jury term expires, said his lawyer, Jose Luis Fuentes.

We are strong supporters of the constitution and believe in a free press. Of course, the press can be annoying scum at times, but for the most part, we believe in the rights of a free press. It is one of the institutions that keeps everyone honest. With that in mind, we offer our support. We have read his blog and we might disagree vehemently with what he writes about; that isn't the issue. The issue is freedom, something we hold dear. So, good luck to Mr. Josh Wolf!

Tax Cheats Prosper

2006-08-02T10:54:00.000-06:00

We find this article very disturbing. Integrity is one of the most important things to us. Nothing will get you removed from a position in our company faster than lack of integrity. It is a growing trend and certainly not part of an abundant lifestyle. We are all for reducing your taxes, as long as it is done legally. It's truly sad when you see cheaters prosper.

Today's pop quiz will gauge your legal and business judgment. You don't have to have any special experience or training. Simply consider these facts:

A wealthy client is about to realize a $1.5 billion profit from the sale of a business and wants to minimize his tax exposure. He contacts you with a proposed transaction that would cut the tax on the gain from about $300 million to zero and asks you to render a written opinion about the deal's propriety that he can rely on if the tax shelter ever faces a legal challenge.

The tax shelter involves two entities on the Isle of Man, a tax haven known for its strict financial secrecy laws. The shelter is built around a basket of $9 billion of tech stocks, borrowed from European investors, that have recently fallen in value. These "losing" shares will be run through a series of complex transactions between the two entities, involving put options and collars, that largely cancel each other out while preserving the underlying tax losses for use by the client to offset his original $1.5 billion gain.

What should you advise the client?

(a) Because Congress was never really serious about collecting taxes from the super-rich, this transaction is "more likely than not" to survive any challenge by the Internal Revenue Service. Or,

(b) Don't go anywhere near a tax shelter built around what look like sham transactions by unknown entities in offshore tax havens that promise "indefinite" tax deferral. As my grandmother once told me, if something looks too good to be true, it probably is.

Grandma was right, of course. The correct answer is "b."

But if you answered "a," don't despair. You could be an excellent candidate for a partnership in the tax practice at Cravath, Swaine & Moore or Bryan Cave, or a managing directorship in the private banking divisions of Bank of America or HSBC.

The other sad thing is the lack of publicity this is receiving. I guess it is ho hum after mega-scandals like Enron. For us, it is a big deal, one that should be taken very seriously. We applaud the wealthy, but only those who got there honorably.

UPDATE: We found a far more indepth article on this subject and wanted to share it with you.

Among the billionaires cited in the report are the owner of the New York Jets football team, Robert Wood Johnson IV; the producer of the “Mighty Morphin Power Rangers” children’s show, Haim Saban; and two Texas businessmen, Charles and Sam Wyly, who the Center for Public Integrity found in 2000 were the ninth-largest contributors to President Bush.

Mr. Johnson and Mr. Saban, who are portrayed as victims in the report, are scheduled to testify today before the Senate Permanent Investigations subcommittee. They are expected to say that professional advisers assured them their deals to avoid taxes were more likely lawful than not. The Wyly brothers told the committee that they would invoke their Fifth Amendment right against self-incrimination and thus were not called to testify. The report characterizes them as active participants in tax schemes.

Cheating now equals about 7 cents out of each dollar paid by honest taxpayers, as much as $70 billion a year, the report estimated.

“The universe of offshore tax cheating has become so large that no one, not even the United States government, could go after all of it,” said Senator Carl Levin, the Michigan Democrat whose staff ran the investigation.

$70 Billion a year?!? While we realize that our nation spends trillions of dollars every year, $70 Billion is certainly nothing to sneeze at! Just think of the good that money could do if every cent was donated to a responsible charity! The more we read about this, the greater our anger and disgust grows. We also find it difficult to accept some of the excuses given. Before you invest, before you put your money into a plan, before you use some plan to reduce your taxes, it is up to you to do all the research necessary to make sure it is legal! No wonder so much money is lost every year in get rich quick scams and the like. People live in a scarcity world and don't understand that it doesn't take a scheme or something underhanded to become wealthy. All it takes is the right mentality, an abundance mentality. If you think, live and act the right way, riches will come. You don't need the other dreck!

MasterCard Results Beat Forcaste

2006-08-02T10:36:00.000-06:00

The world's second-largest credit card association also said net revenue increased 9.7 percent to $846 million, ahead of analysts' forecast of $802.47 million.

SUCKERS! That's $846 million that could have gone into a retirement plan or for someother purpose. Instead it went to pay for interest on credit cards and loans!

Abundance - Own Your Life Radio Show

2006-08-01T17:19:00.000-06:00

We are announcing it here first. We have decided to do our own radio show, starting this weekend! The name of the show will be "Abundance - Own Your Life".

We are soooooo excited that we can hardly stand it. So what will the show be about?

Well, to start with, this won't be your bland financial show where people call in with their problems and we find solutions for an hour. Not to say that we won't be helping our listeners and answering questions, but we are taking on the industry! We are going to expose the myths that big business wants you to believe. Credit Cards make your life worth living? How about how they DESTROY your life. Mortgage companies are NOT your friend. And more! We are going to take them all on, head on and tell the blunt truth.

Soon, our radio show website will be up and running, AbundanceRadio.com.

To begin with, our show will are on KMXE, 830 AM, in the Greater LA area from 7:00 am - 8:00 am. For those outside that area, the broadcast will be available via our internet site, both live and archived.

Don't miss our inaugural show this weekend!

Testimonials

2006-08-01T16:34:00.000-06:00

Not to toot our own horn, but...we've had various requests for testimonials and if we could post them here.

We've had a ton of testimonials and they continue to come in! Please visit our corporate site here to read what our clients have to say about us. Visit often as new testimonials are constantly posted!

We'll also be posting a video of testimonials as well...

Okay, so we are tooting our own horn!

Don't forget our FREE OFFER!

2006-07-24T12:04:00.000-06:00

We made this free offer a while ago and the offer still stands. We are pleased that while our readership is slowly growing, many of you have taken us up on the offer below! So, we are reposting this as a reminder to all of you and to again thank you for reading our blog!

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Many of you find our blog through our main website. We appreciate you coming here and reading more about what we think and feel.

If you came to us through the main site, you know that we offer a full, personalized financial report and financial consultation from one of our trained consultants for $179.00. Even though our blog is just starting, we thought it would be fun to offer all of you, our loyal readers, a special deal. We are going to give you a special 800 number to call where you can get this report and consultation for free! Yep, zip, zero, nada, nothing! You don't pay us anything. We'll even pick up our consultants salary!

If you have never heard of our report and consultation, please go here and read all about it, just remember, DON'T DIAL THAT NUMBER! If you do, they will charge you for the report and consultation. Instead, dial this number 888-221-9394 and get it for free!

Why are we doing this? Well, for one, we believe in this blog and its ability to help people. We believe in what we are writing here and we truly want each and every one of you to be successful and live an Abundant life! We know our report and consultation can help you get there. So, we are giving you the chance to have it for free. It will also allow us to gauge the readership that we have here and may offer us insight into how to make our blog better. For us, it is worth eating the cost to get this information.

Feel free to share this with your friends and family. Have them drop by the blog and see what they think about our ideas and beliefs.

Again, the number you need to dial for the free report and consultation is: 888-221-9394

Don't forget our FREE OFFER!

2006-07-24T10:56:00.000-06:00

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Chocolate Surges Ahead!

2006-07-21T10:59:00.000-06:00

Good news! Good news!

The Hershey Company, the nation’s largest candy maker, said yesterday that second-quarter profit grew 6 percent, helped in part by seasonal shipments and popularity of its Kissables candy-coated chocolates.

As chocolate lovers, we rejoice when a classic company like Hershey does well. A world without chocolate would definitely be a world of scarcity!

A tip for fellow chocolate lovers, you can never go wrong doing your gift shopping here.

Free Question Friday!

2006-07-21T10:19:00.000-06:00

Curious about us? Have a question about your personal finances? Want to know the answers to all of your questions?

Send us an email today asking and we'll do our best to answer! If we don't know the answer, we can always fake it! j/k!!!

Seriously though, take the time and drop us a note. We love to hear from our readers and love to answer your questions!

Finding The Right Job

2006-07-20T17:21:00.000-06:00

A couple of days ago, we discussed hiring the right employees. Today, we want to talk about about finding the right job to suit you. That is something of extreme importance! Unless you are one of the privileged few, you will spend a great deal of time during your life at work. It would really behoove you to find something that you enjoy. In fact, not just enjoy, but something that you have a passion about!

Anne Fisher, columnist of Fortune Magazine has some good advice in regards to this ultimate decision.

Alan L. Sklover (http://www.ExecutiveLaw.com), a New York City attorney who has represented executives in all kinds of negotiations for decades, says that many people don't take the time when they were young to choose the appropriate career. "Many of our clients, especially those in their 40s and 50s, have come to question the career decisions they made" when they were your age, Sklover says. "Most often, they regret not having taken the time to get a wider exposure to the working world before deciding on a chosen field."

The fact that you have several interests is a good thing, in his view. "Apply for every job you can find that is related to any of your interests. Always write down what you like and dislike about the jobs you do, and what you learn about yourself from them," he says. "Sooner or later you'll develop a sense of direction -- and maybe even a passion about what you do for a living."

Sklover calls his approach the Three Exes: Exposure, experience, and excitement. "Don't be afraid to take any job that interests you," he says. "You're not locked in for life. If there's one time you're supposed to take chances, it's while you're younger and relatively free of responsibilities. After that, trying something new takes courage that very few have." Exposure to a wide range of companies and roles can help you find where you belong -- and will make you a more marketable commodity later on too. Likewise, Sklover recommends that, once you find a company or an industry that suits you, try to get "the most varied experience possible within it. Practical skills, once learned, aren't forgotten. Every great building is built one brick at a time." As for the third "ex," excitement, it comes when you've caught a glimpse of work that you can pursue with passion.

This is fantastic advice. We want to add that you should put everything you have into each job you get. Each job deserves your all, it deserves a full chance to show you all there is in that field. If you don't apply yourself fully, you'll never get the chance to see what might be around the very next corner. It doesn't matter if you are the french fry cook at your local fast food or assistant to the president of the largest bank in your area, give it everything you have!

A good friend of ours always chuckles when he hears people deriding the fast food industry. He started there in high school, his first job was coming in at nights and cleaning up. He would scrub floors, counters, utensils, bathrooms and more. He put everything into it and was soon promoted. He stuck with it and by the time he graduated from high school realized that he loved the fast food industry. After getting his bachelor's degree in college and going to work for his father in the family construction business, his thoughts kept going back to those wonderful burgers and fries. His mind was filled with chocolate shakes and chicken nuggets. It didn't happen overnight, but he finally convinced his father that he would rather be surrounded with grease and ketchup than cement and steel girders.

With a loan from his father and literally years of experience, he purchased his first McDonald's franchise, the first that town had seen. Over 30 years have gone by and he now owns 10 franchises. He loved McDonalds from the first Big Mac he ever had. That love grew during the years he worked there as a teen, doing every job imaginable from scrubbing the toilets to head manager. He found his love, his passion and put his all into it. You can do the same!

Take some time and do the research. Try every job imaginable, you never know what might strike your fancy. Give each job 100% effort! Once you think you've found your calling in life, work every aspect of it. Do whatever you must to learn everything there is to know about the job. Finally, remember it's never too late. You can always change and go a new direction. The key is to understand yourself and realize that as life goes on, people change, you change. So what might have been your dream job 20 years ago might not be now. Understand that there is nothing wrong with that.

Thinking of this reminds me of another friend. A successful businessman and father, at age of 40 decided to go back to school and become a pediatrician. People said he was nuts, insane, but he knew that was what he needed to do. It wasn't an easy decision and one that he involved the entire family in making. With their loving support, he followed his dream and the abundance flowed. He is now a happy, successful pediatrician.

You can do it too! Whether it is your first job or you are a seasoned veteran, follow your dreams, let the abundance flow and your dream job will follow.

Answering Questions

2006-07-19T16:21:00.000-06:00

We wanted to take some time today and answer questions that have come in since we stared the blog, either via comments or email.
Probably the most thought provoking question came from a person who identified himself as Paul. Well Paul, lets look at it a piece at a time.

First, thank you for the offer for the free report and consultation. I recently was intrigued by the mention of your company and some of its financial philosophies on a radio broadcast. I called the given number, and have since talked to one of your employees over the phone. I also have a consultation set with another consultant tomorrow evening at 8:00 p.m. I have far too many questions to ask in this blog, but I am curious about a few things specifically, as they relate to your philosophy. I have been working with a financial advisor for a few years. A few of his key pieces of advise go against recommendations on previous blogs, yet, at the same time, some are akin. He (my financial advisor) suggests that carrying a mortgage is fine due to the given tax breaks. I know this differs from your recommendations, and I do understand why. However, how does compounded interest come in to play in this equation. Am I better off, (1) Carrying a large mortgage, putting money into investments such as mutual funds and IRAs, and letting the compound interest build over the next 30 years (I am only 30) or, (2) Using additional funds each month to pay down my mortgage, and then investing when my mortgage is paid off? Wouldn't I then be losing the value of 10 - 15 years of compounded interest.

This is a great question and one that we get a lot. It is one of the reasons that we give the offer of the free financial statement and consultation with one of our consultants. This is one of the areas that they discuss. First let’s ask why your financial planner would want you to do that. Remember you planner makes a commission on everything you invest and makes nothing on you paying off your debt. Why in the world would he tell you to go pay off your house then come back to invest with him years later. Hmmmmmmm??? To him your only way he can get you to invest with him would be to have you mortgage yourself to the hilt and then give your money to him. I’m sure he even showed you all sorts of nifty colorful graphs that seemed to assure you that his way was the best way to go. He may or may not have emphasized that all those graphs say that there are no promises or guarantees and the example is only for discussion purposes. When you pay off your debt you are guaranteed a return on your money. Not to mention the security that you own your life. The best way to look at this is to see a side by side comparison. That is included in the report. You will able to see with your own eyes that paying off your mortgage, then using ALL of that money to invest will, in the end, be far more money for you than if you keep the mortgage and invest. Again, it is simple math. Paying off the mortgage and then investing the money is definitely the way to go! Also remember you cannot effectively serve 2 masters at the same time.

What is your thought on insurance, such as life and disability? I currently carry life policies on myself, my wife, and one of our sons (the other was just born), and disability for myself and my wife. Despite the fact that we have disabilty insurance through our employer (we are both educators), our financial advisor still suggests we carry disability insurance through his provider. Is this really necessary? Are we truly gaining anything by hanging on to the additional disabilty insurance just to keep the premium down (if we cancelled and wanted to purchase in the future the cost would be much higher)?

First, ask yourself what you need the disability insurance for? Do you have savings in place if something was to happen to you? Or in the case of injury or death? Is that disability insurance going to cover you in the aspects you need to be insured on? Insurance is always sold not bought, so you have to know exactly what you are paying for because most of the time it doesn’t even cover the areas you need. Take time to understand what you are paying for and get educated on where your money is going. As for life insurance, you take care of your family now financially... would you want that to change if you were to die? Make sure you have the maximum amount of coverage for the least premium possible. Insurance generally goes up as you age because the risk is higher. The key is to become self insured at some point through investment and savings. Your focus should be not to have to pay insurance premiums forever unless you absolutely need too. I mean really... if you were debt free and had enough money for retirement is there a need for insurance? Again, the key is being educated on ALL areas of your finance and that is what we do is focus on education so you can be in control. Those are all great questions for your financial consultant. Lastly, remember that any insurance you purchase through your financial advisor pays him a commission. That can create a conflict of interest in some cases.

Finally, thank you for your input on the topics covered on this blog. I enjoy looking at varying points of view on these matters; your justification for your beliefs makes sense. I look forward to speaking with your consultant and hearing the answers to these questions, and others.

We appreciate the questions, feel free to ask more at anytime! Please, take advantage of the free offer, many of your questions will be answered there.

Pre-View SMI Infomercial -- ONLY for our blog readers!

2006-07-19T15:26:00.000-06:00

SMI is preparing some informercials for TV. We are early in the production cycle, but here is a couple minute preview of the first infomercial for you, our loyal blog readers, to see. Let us know what you think!

Click here to see the video.

Quicktime needed.

Personal Car Debt on the Rise

2006-07-19T14:42:00.000-06:00

Another sad commentary on the state of debt in this nation of ours.

It appears we've hit another consumer milestone, and it's not one we should be proud of either.

Last year it was our savings rate. In 2005, for the first time since the Great Depression, the personal savings rate fell into negative territory.

This year consumers have hit another landmark. The majority of auto loans are now written for five years or longer.

New-vehicle loans over 60 months accounted for nearly 55 percent of loan originations, according to the Consumer Bankers Association's 2006 Automobile Finance Study. Used-vehicle loans over 60 months accounted for 40 percent of originations.

In 2000, five-year or longer car loans made up just 22 percent of all such lending.

Hello!?!? What are we doing here? These are CARS for goodness sake, the go DOWN in value. If you can't afford the car, DON'T BUY THE CAR!

This is just another example of the scarcity mentality that we constantly talk about. We are so caught up in keeping up with the Joneses that we spend ourselves into a disaster. Buying a car with a loan is bad enough, but going over 60 months on the loan? This is completely unconscionable! Not only should the buyer be ashamed, but the banks and other lending institutions as well. They are handing you the shovel and stand there watching, as you dig the hole deeper and deeper. If you aren't going fast enough, they'll throw in a pick as well.

We can't say it enough. It's time to take control of your life. Stop this out of control spending on items you can't afford. Once you get control and get out of debt, you'll be amazed at how easy it is to have that dream car, that dream home or take that dream vacation. But its important that you do it in the right order. And of course, we are always, always here to help!

Pre-pay your Mortgage

2006-07-19T14:04:00.000-06:00

Reading some articles in the blogosphere the other day, we ran onto the smartest man in the world. Why is he the smartest man in the world? Well, of course, because he agrees with us! More and more, we are finding people who agree with our philosophy of paying off your mortgage and NOT using that money to invest in other things.

Here is what he had to say.

This piece is a question from a Money reader who's wondering if he should pre-pay his 5.25% mortgage or invest the $500 extra he has left over ever month. Here's what Money has to say:

My take is that as a purely financial matter, you're probably better off investing the extra $500 a month given your low mortgage rate. If you repay your home loan ahead of schedule, you're basically earning a 5.25% return, which represents the amount of interest you avoided paying by making the extra payments. I think you should be able to do better than that over the long term by investing in a diversified portfolio of stocks and bonds.

See, I told you I'd disagree. If it was me, I'd pre-pay the mortgage.

My problem with Money's answer is that:

1. You SHOULD be able to beat the cost of the loan. But paying off the loan is guaranteed, the return is not.

2. What if the interest rate increases? This guy has a fixed rate, so he's ok, but for holders of variable-rate loans, the answer could be different. After all, seems to me that rates are headed one way lately, and it's not down.

3. There is a HUGE difference between a philosophical answer and the practical execution of that answer. What I've seen most people do is to get this answer to justify why they shouldn't pre-pay their mortgage, then end up blowing (not investing) the $500 each month. It's a rare person who actually invests the amount as planned.

4. There's a great feeling to being totally debt free. I've been without debt for several years now, so I'm speaking from experience.

Amen, amen, amen and amen. He nails the answers every time.

Join the club! You know you want to! Pay that mortgage off and feel like you've never felt before!

Hiring the PASSIONATE employee

2006-07-18T17:07:00.000-06:00

Passion. What a wonderful word. It goes so well with Abundance! You need to be passionate about things! More than mere enthusiasm, passion envelopes a person, carrying them along, pushing them forward to places even they have yet to imagine.

These are the kind of people that we hire at Smith and Merritt Institute. We hire PASSIONATE people. People who are looking to go somewhere and do something big with themselves. Our employees come to us constantly with new ideas, big thoughts and big plans. Why? Because they are passionate about the work they do. They are constantly pushing, dreaming and working to build a bigger, better company, rising to levels they had previously never thought possible.

How do you find these kind of people? It isn't easy. This article gives some wonderful suggestions to help you find the kind of employee you want. If you are the one looking for a job, take these suggestions in the article and find a job that you are passionate about! Let's look at a few paragraphs about finding that passionate person.

To gauge that, Adler recommends digging deeply into a candidate's work history. "You need to take the time to do a detailed, job-by-job review. Where did this person excel in the past? What specific achievements got recognized and rewarded? Why did she get promoted? Which job or jobs really gave him a chance to shine? This will show you pretty clearly what the candidate is passionate about. Then you can assess whether her passions match the job you're trying to fill."

Excellent. Spend some time finding out about the person you are considering hiring. Not only do they need to be passionate, they need to be passionate about the job you have to offer!

"I always think that when companies talk about passion, one thing they mean is, a willingness to take risks," Sanford says. "So one question I ask candidates is, 'Tell me about some of the risks you've taken and how they turned out.' A person who has never taken a risk is probably not who you're looking for."

He adds that "passion really comes down to confidence and courage, including a willingness to push back and take an unpopular position if you really believe in it."

YES! Confidence and courage! This means the employer has to be the right person as well. He/She needs to want the passionate employee and be able to work with that kind of person. He/She needs to understand that others have vision and that someone else's idea might be the one that takes them to new heights, places they've never been before.

How can an interviewer measure that? "One test is, will this candidate debate with me?," says Sanford. "Sometimes during our conversation I'll roll out an opinion or an idea that I know is way out of left field, just to see if the candidate is willing to argue - politely, of course, but with conviction."

...

Another tip-off: "I ask people what they are passionate about outside of work. Someone whose eyes light up when they talk about a sport or a charity or whatever it is they do in their spare time - that is someone who will probably be passionate on the job too. People don't switch their passion off when they walk into work in the morning. It carries over. By contrast, someone who's just going through the motions with no special passion outside of work will probably be the same way in the office."

Excellent! We hired an employee not long ago to help with some of our media. One of the tip-offs for us was his outside interest. This young man had helped start a charity to help the impoverished in Iraq and had grown it larger and larger. You could feel the passion in his voice and the eagerness in his eyes when he spoke of the work they had done. We knew right then we had a person of passion.

"Too many employers pay lip service to the idea of passion but in fact they want cookie-cutter thinking, which is why they end up with cookie-cutter hires. They want everyone to stay in his or her neat little box," he says.

"I've seen it time and time again," Sanford continues. "Hiring managers will opt for the 'safe' candidate rather than a more provocative one - and then they're disappointed a year later when the person hasn't stepped up and produced fantastic results."

That says it all. This seems to be the majority of companies. Not only do people have scarcity mentalities, so do companies as well. Whether you are just starting out or a seasoned veteran looking for your next opportunity, find that place that will embrace your passion for life and will reward you for living abundantly! We're proud to have built a company like that with the Smith and Merritt Institute. It makes us enthused to go to work everyday and be with the passionate, abundant people that we have hired. We feed off their energy and they feed off of ours. It makes it almost difficult to go home at night. In fact, if our homes weren't just as abundant or more so than our work, we might stay there 24 hours a day. Luckily, we have abundant, loving families to go home to at night.

This is what it's all about folks! Abundance! Get it in your life, now!

Boeing vs. Airbus

2006-07-18T13:41:00.000-06:00

Here is another wonderful example that we love to look at when discussing Abundance and Scarcity. Boeing is the essence of Abundance and Airbus the epitome of Scarcity.

How can we say that? Easy!

Airbus relies on government subsidies and backing to stay in business. Back door deals and arm twisting keeps them in business. Don't believe it? Take a look at this example.

TSUNAMI-struck Thailand has been told by the European Commission that it must buy six A380 Airbus aircraft if it wants to escape the tariffs against its fishing industry.

While millions of Europeans are sending aid to Thailand to help its recovery, trade authorities in Brussels are demanding that Thai Airlines, its national carrier, pays £1.3 billion to buy its double-decker aircraft.

How disgusting can you get? During one of the worst disasters in recent history, you have the EU basically FORCING Thailand to purchase this white elephant of an airplane to escape future problems.

We despise flying when we have to ride an Airbus plane. You can just feel the lack of quality and the complete disregard the company has towards its passengers. Why should they care? They have governments to back them and force sales.

On the other hand, you have Boeing. An amazing company that has weathered it all. Its planes are magnificent, each new model overcoming problems of the past model.

In the past few years, there has been the hugh and cry of the need of a 'super-jumbo' jet, the jet that Airbus has built. The jet that will force airports to completely reconfigure their runways and terminals. Boeing saw this for the smoke and mirrors that it was and refused to play ball. Of course, they looked into things, even came up with some designs. But they went out and saw what was really needed, listened to their customers and decided to stay out of the market. Some pundits stated this would be the end of Boeing, but they were wrong.

Now we have Boeings latest announcement.

Boeing announces a modification to their flagship 747. We now have the 747-8. What's so special about that? Well, they incorporated some of the new stuff from the 787 dreamliner and other recent planes into the 747 making it faster, far more efficient, cost-effective and a bargain for the industry. With this airplane, you won't have to drastically retrain pilots and passengers are comfortable in a plane with such a long and safe history. Airports don't have to change their configuration and it holds only slightly fewer passengers than the beomouth produced by Airbus.

But what does that mean in the real world?

Well, just look at this:

Boeing secured orders for 493 aircraft over the first half of this year, four times the number recorded by European rival Airbus over the same period.

Even with the arm twisting and government subsidies given to Airbus, Boeing soars ahead! This is Abundance!!! Boeing a glowing example, one that we should all support. The next time you fly, ask what kind of airplane it is and insist on flying Boeing!

Interesting Comment of Scarcity and Abundance!

2006-07-18T13:37:00.000-06:00

We read an interesting comment the other day.

Even if peace reigned in the ME, even if all the world's terrorists turned pacifists and democracies flowered like dandelions, the rest of the world would still view the US with trepidation at best.

This is because the new wealth system the US is developing, by its very nature, threatens old, embedded financial and political interests around the world.

Moreover, in the US the rise of the new wealth system has been accompanied by the controversial changes in the roles of women, racial and ethnic minorities, gays and other groups.

This is truly fascinating. It shows a real scarcity mindset on the part of the author and 'old money'. Yet, we find it encouraging because of the way it shows America and the growth that is happening. This is Abundance in a huge way! Everyone, from every walk of life, all growing wealthy. This flies in the face of 'old money' with its scarcity ways. Why do you think there is so much stagnation in so many markets around the world? It's because they won't accept that ANYONE and EVERYONE can become wealthy!

We do, and just look at us grow!

Why SMI is Different!

2006-07-17T15:47:00.000-06:00

The Smith & Merritt Institute is different. It is unlike any other financial institution in the world.

Dan Smith gives you the reason why in this video clip.

Kathryn's Story

2006-07-14T05:00:00.000-06:00

As we mentioned before, we have been working on some video work. We'd like to share some of it with you, before sharing it anywhere else. We'd like to start with Kathryn's story.

Please click here to view Kathryn's moving testimony.

We hope you enjoy this peek into Kathryn's life as she shares her most difficult moments with you so you can understand just how important she feels this message is for everyone.

UPDATE: Kathryn's video has been re-editted. Watch it again to see the differences!

Apologies

2006-07-05T11:18:00.000-06:00

We apologize for not having written in so long. We have been working on a video presentation which we hope to debut on the blog! Look for it real soon!

Pay Day Loan Predators!

2006-06-22T11:30:00.000-06:00

We couldn't agree more with the following article.

They carry innocuous names like Doctor Check, Money Mart and Cash Cow. But critics of payday-loan stores say the high-interest products they peddle are anything but harmless and should be outlawed.

"Payday-loan companies say their growth indicates there is a big demand for their services," says Jordan Ash, director of financial issues for the national consumer group ACORN, which has a Baton Rouge office. "The same could be said for people buying crack cocaine. Lots of folks buy crack, but that doesn't mean there's a legitimate need for it."

ACORN claims a vast majority of stores are placed in minority communities, preying on the poor and elderly and dragging low-income wage earners and people who rely on monthly government assistance into deeper debt cycles.

Amen on this! These companies are a scourge on the nation. They are an abomination and should be illegal. We see their commercials on TV and they sicken us, making you think the money they give is almost free. That couldn't be further from the truth!

A typical example, ACORN says, follows this scenario: Someone on a fixed income takes out a payday loan to cover an extra expense--an unexpected medical bill, perhaps. Two weeks later, the borrower is forced to pay back the loan, usually less than $500, in its entirety and with substantial interest. But because of fixed expenses, another fast loan may be needed as soon as the first one is paid off, and the borrower has become entrapped in the payday-loan game.

They nailed it on the head. These companies perpetuate a scarcity mentality and way of life. They enslave people who become reliant upon them until they finally default.

The leaders of the industry try to explain it all away.

Schlein says people who seek payday loans are looking for a handy fix to a temporary financial problem. "A lot of our borrowers have pride--they don't want to bring family and friends into their personal lives. The elitist consumer groups have nothing to offer these people except demagoguery."

Oh please! These people are going there as, what they think, is a last resort. That just isn't so! There is always some other way!

John Braud, deputy chief examiner at OFI, says there has been no serious legislative push in recent years to ban, limit or further regulate payday lenders. Nor has his office suggested any new laws that could possibly affect the business.

"There wouldn't be so many of them, if people didn't want the product," Braud says.

There wouldn't be so many of them if there weren't so many desperate people. People that need to learn a different way of life, NOT an industry that shackles to their services like a drug user looking for his next fix. It is time to ban these illegitimate blights on society once and for all! It's time to educate people on the proper way of using their money and finances. We're embarrassed that our state allows these companies to flourish here. 12 states have banned them, let's hope others take the hint and follow their lead.

Whatever you do, avoid these businesses like the plague!

Personal Debt Soaring Worldwide

2006-06-20T07:54:00.000-06:00

Personal debt is not only a US problem, it is a worldwide problem. People all over are spending more than they have. It seems that keeping up with the Joneses is also a keeping up with any name you can think of indigenous to a country.

In Korea.

South Koreans have less ability to repay their debts than citizens of Japan and the United States because they prefer to invest in real estate and other types of non-liquid assets, the Bank of Korea (BOK) said Wednesday.

The bank said financial assets held by South Korean individuals amounted to 1,393 trillion won ($1,440 billion) as of the end of 2005. This is 2.3 times larger than their debt worth 602 trillion won.

The United Kingdom.

At the end of April this year, the total UK personal debt was £1.19 billion and our personal debt increases by £1 million every four minutes.

Ireland.

Levels of personal debt in Ireland are currently increasing at their fastest rate in five years, according to figures published by the Central Bank today.

The bank said total lending increased by 29.6% in the 12 months to April this year, the highest rate since March 2000.

Australia.

Figures from the Reserve Bank of Australia (RBA) show an increase in the amount of debt people are willing to take on for personal items.

The credit data shows that while business lending is still strong, the amount of finance provided for housing and private use has also risen.

And the list goes on and on...

It is a major problem, worldwide problem. You can change that though, you can make yourself the exception. It's time to own your life, get out of debt, get out of debt now. It isn't hard, really. We can help, give us a call!

Pay Debt or Emergency Savings?

2006-06-19T17:35:00.000-06:00

It's a major question that many people ask. Should I pay off my debts first or create an emergency savings first? With as many people as ask this question are those that are answering it, and they all have different answers.

USA Today recently tackled this problem and, in what seems to be the weasely way of many in the world, they fudge on their answer. They give a non-answer really. The USA Today says, do both! GAAAAAHHHHH!!!! Worms! A pox on their children! This is no answer.

For many couples, it's a familiar dilemma: You've got debt. You don't have much savings. And you have a bit of extra money at the end of the month. Should you pay off your debt or add to your savings?

Both, experts say. Having emergency savings is your best protection against running up debt. And paying down high-interest debt is probably the best investment you can make.

Well, duh! OF COURSE, both of those are necessary things, people understand that. What they need to know is which to do first!

Create an emergency savings first! It is the most important thing you can do. Without an emergency savings, you run the risk of running up more and more debt. You need that savings against the unknown.

The next question is how much savings should you have? We suggest at least 3 months income worth. It is different for each person and there are various variables to consider so this is a basic answer. Feel free to call the number given below in our special offer and one of our financial advisers can give you a more complete answer.

Again, we advocate doing both things as given above. They are BOTH very important. Once you get your emergency funds in place it is vital that you pay off your debts. We'll get into this more later.

Until then, live Abundantly!

Control Those Thoughts, Think for Yourself, Become Abundant!

2006-06-13T15:41:00.000-06:00

There are various claims as to the number of thoughts a person has a day, some say 60,000, some 100,000 and some even more. It really doesn’t matter. It could be 1000. What is important is what you are thinking.

Most people do not think for themselves. That’s a basic but true statement. No, we might not like it, but it is true. They allow their training or education and their culture to determine what they think. When I say training or education, I mean television, at least among most of our children. Most people are not even aware of what they think and why they think what they do. How many times to you hear people use clichés that were just used on the most popular TV show or cute commercial?

Most people don't even attempt to control exactly what they think. They just allow their random daily thought processes to go on, unexamined and uncontrolled. They are the ones that become the latest TV ad statistics. You can thank them for the TV programming you see today!

If you want to be successful you must determine what you are thinking and why; and then, you must determine to think on purpose. That is, you must consciously and intentionally choose to hold in mind those specific thoughts that will contribute to your success. This has got to be one of the most difficult things that you will do. It is so easy to let someone else control what think and do. Controlling your thoughts, changing them to be productive and helpful in your daily life will take a great amount of effort, but there is nothing more important you can do towards becoming abundant.

You must learn to think for yourself.

Your thoughts create your reality. If you want your reality to change, you must change your thinking. You must think your own purposefully chosen thoughts. You have to control the direction and attitude of your thoughts. Again, you can’t let others take control.

Examine your daily thought processes and then decide to control what you think. Once you start doing this, you can begin to control your life and bring Abundance into it.

Free Report and Consultation for our Blog Readers

2006-06-12T12:43:00.000-06:00

Another Good Reason to PAY OFF THAT MORTGAGE!!!

2006-06-08T14:32:00.000-06:00

Here is just another good reason to get that mortgage paid off just as soon as possible.

Many homeowners with adjustable rate mortgages, especially the poor, will be targeted by scam artists in the near future as mortgage interest rates move higher, industry experts cautioned on Monday.

"It's about lyin', cheatin' and stealin' -- it's as simple as that," said David McLaughlin, assistant attorney general for Georgia, which has put tough new laws on its books to target mortgage fraud.

When we discussed the evils of ARMs earlier, we forgot to add this to it. Just another good reason to get that mortgage paid off as soon as you can. Beyond that, STAY AWAY FROM ARMs! There really is little good to say about them. Now, you have scam artists preying on the desperate. People in a home they can't afford with an ARM is now looking at their interest rates to rise. These people are starting to panic. They don't know how they are going to keep their home and are wide open to these scams.

Some $1.5 trillion in adjustable rate mortgages will be reset in the next two years, Gottschall said.

Many at-risk borrowers in nine Chicago areas served by NHS have sub-prime loans that already carry rates closer to 10 percent or 12 percent than the low rates common on ARMS during the recent years-long housing boom.

A large slice of loans going into foreclosure within three years of origination were priced 300 basis points or more over the 30-year Treasury bond yield, Gottschall said.

"There will be more opportunities for fraud because these borrowers are often less sophisticated and have less opportunities," Gottschall said. "People sign papers that they don't understand."

Like we mentioned above, these people are desperate. Not only that, many of these people really don't know what they are doing and just sign what they are told to sign. I know this sounds nuts, but people, making the largest purchase they will probably ever make, really have no idea what the paperwork actually says. They just trust the real estate agent not to screw them over. Luckily, most of them will be honest and the buyer gets lucky.

Over $1 billion was lost to mortgage fraud in fiscal 2005, according to Suspicious Activity Reports, or SARS, filed with the Federal Bureau of Investigation. That was up from $429 million in fiscal 2004. Not all mortgage lenders are required to file SARS, suggesting those losses are understated.

"Mortgage fraud is the fastest-growing white collar crime affecting the United States today," said Karen Spangenberg, section chief with the FBI's financial crimes section in Washington, D.C.

Take a look at those numbers. This kind of fraud basically DOUBLED in one year. Considering the way the housing market is going, it could easily double again. We want all of you to be careful. Don't become one of the victims. Instead, work towards paying off your mortgage so you never have to worry about something like this again. It might seem daunting, a mountain too tall to cross, but it isn't. Most of the people we work with have their mortgage paid off in 7-10 years.

Living Abundantly

2006-06-06T19:54:00.000-06:00

Hello folks. It is time, overtime to get our message out. That message is one of financial health and wellness. As we look at the world today, we are concerned, very concerned. Poverty is rampant as well as greed. People die needlessly ever day from conditions that and diseases that shouldn’t exist in the world today. And yet they persist.

Why is that? Why does poverty exist? Why is there disease and starvation killing thousands and thousands every year? We live in the most technically sophisticated time there has ever been. There is more wealth then there has ever been. We have the ability to go to the heavens with ships and satellites, probe the depths of the oceans in submarines, fly faster than the speed of sound and communicate across the world instantly, yet we can’t seem to solve these problems.

The UN has made starvation and disease one of its leading causes. So have many of the first world nations. Billions of dollars have been spent (wasted?) trying to solve the issues but they continue to this day. What is the solution?

Folks, we have the solution. Sound arrogant? So be it. We are serious, we can solve the problems of the world. Because of this, we have no false modesty. Disease, poverty and starvation can be solved. How you ask? It’s real simple. It is time for EVERYONE to begin living Abundantly. That’s right, live Abundantly.

People don’t understand what happens when people start to live abundantly. Things change fundamentally for them and those around them. Those living Abundantly gain the wealth they need and what they need to help others. Those living Abundantly are the ones that come up with the solutions to problems.

Of course nations are needed. If it wasn’t for a US nuclear aircraft carrier after the recent tsunami, thousands more would have died from the lack of sanitary water. Only a nation has those kind of resources. But it is individuals who come up with the long-term thinking and methods that change the world. People like Bill Gates and his foundation, intelligently spending millions of dollars, are educating children that would have grown up in poverty and squalor. These children, with their knowledge and new found education will be those that change the living conditions of all living around them.

Bill Gates is only one of many; one of those at an early age that learned to think Abundantly. He and others like him are changing the world. You can be one of these people.

That is what we are talking about and that is what living Abundantly accomplishes. If you want to learn more about living Abundantly, please visit our corporate site, http://spendtowealth.com. We look forward to working with each and every one of you.

Living Abundantly

2006-06-06T16:27:00.000-06:00

Hello folks. It is time, overtime to get our message out. That message is one of financial health and wellness. As we look at the world today, we are concerned, very concerned. Poverty is rampant as well as greed. People die needlessly ever day from conditions that and diseases that shouldn’t exist in the world today. And yet they persist.

Why is that? Why does poverty exist? Why is there disease and starvation killing thousands and thousands every year? We live in the most technically sophisticated time there has ever been. There is more wealth then there has ever been. We have the ability to go to the heavens with ships and satellites, probe the depths of the oceans in submarines, fly faster than the speed of sound and communicate across the world instantly, yet we can’t seem to solve these problems.

The UN has made starvation and disease one of its leading causes. So have many of the first world nations. Billions of dollars have been spent (waisted?) trying to solve the issues but they continue to this day. What is the solution?

Folks, we have the solution. Sound arrogant? So be it. We are serious, we can solve the problems of the world. Because of this, we have no false modesty. Disease, poverty and starvation can be solved. How you ask? It’s real simple. It is time for EVERYONE to begin living Abundantly. That’s right, live Abundantly.

People don’t understand what happens when people start to live abundantly. Things change fundamentally for them and those around them. Those living Abundantly gain the wealth they need and what they need to help others. Those living Abundantly are the ones that come up with the solutions to problems.

Of course nations are needed. If it wasn’t for a US nuclear aircraft carrier after the recent tsunami, thousands more would have died from the lack of sanitary water. Only a nation has those kind of resources. But it is individuals who come up with the long-term thinking and methods that change the world. People like Bill Gates and his foundation, intelligently spending millions of dollars, are educating children that would have grown up in poverty and squalor. These children, with their knowledge and new found education will be those that change the living conditions of all living around them.

Bill Gates is only one of many; one of those at an early age that learned to think Abundantly. He and others like him are changing the world. You can be one of these people.

That is what we are talking about and that is what living Abundantly accomplishes. If you want to learn more about living Abundantly, please visit our corporate site, http://spendtowealth.com. We look forward to working with each and every one of you.

Secured Personal Loans - Your Personal Financial Titanic

2006-06-05T13:37:00.000-06:00

Boy, the following article just gave us the willies when we read it. Once again, we are getting advice on how to get deeper and deeper in debt. Not only does this article assist you to get deeper and deeper in debt, it is giving advice to those on edge, those ready to lose it all, on how they can get more money, maybe pushing them over the edge. This article is pure evil.

Secured personal loans- secure your “tomorrow”

This headline should probably read, “Secured personal loans – your personal financial Titanic.

Human beings have unlimited wishes. However the resources available to them are limited. It’s not easy to meet their personal requirements through their budget. Hence secured personal loan avails them an opportunity to fulfill their personal desires.

Aaaagh…how can this writer proclaim to be a professional specializing in personal finance? Yes, we have unlimited wishes, it doesn’t mean that we give in to them when we don’t have enough money to pay the rent! These loans don’t give us the opportunity to fulfill desires, they give us the opportunity to lose everything just that much faster. These loans are scarcity creating machines. Buying things on credit is false abundance

A secured personal loan is secured against your property, which is your home in most of the cases. This property is kept as collateral with the lender. He may repossess it legally, if you are unable to repay his money. In return you enjoy low interest rate and long repayment duration. You are also free to fix monthly installments according to your capacity and wish. Besides this you are also free to borrow a good amount due to the presence of collateral.

Oh my gosh! Let’s just put one of our most important resources, one of our most important possessions at risk, our home! And just what are you going to do if you can’t repay the loan? Do you think the people that give these loans, knowing that you have bad credit, are going to give you an inch of leeway? NO! They will snatch up your home just as quick as they can. Is that vacation to Hawaii that important now? Was it really worth losing your home over?

The multiple purposes of secured personal loan are as follows-home improvement, car purchase, debt consolidation, wedding, holiday expenditure etc. This loan is best suited when you need good amount of money for your personal expenditure. It can also be used for commercial activities.

Again, is ANY of this worth losing your home over? The one that really kills us is debt consolidation!!! Normally, when this is discussed, we are discussing credit card debt and the like. So, with this senario, you are replacing unsecured debt with secured debt. Grrrr…. Hello?!? Does this make any sense?

A secured personal loan is also beneficial for people with bad credit history. Their bad credit has now become a forgotten chapter. Lenders generally don’t feel any hesitation in helping you avail bad credit secured personal loan. This loan is designed for such people only. You can go online to search for various lenders available in the market. It’s a speedy and convenient process to get in touch with lenders.

Lenders have no problems with this kind of loan because they know they have a great chance of picking up some property on top of the money the borrower has been paying. Of course they have no hesitation, for them it’s a win-win proposition.

The best thing to do is be wise and frugal. Know what you can afford and what you can’t afford and don’t get caught up in the keeping up with the Joneses. You’ll thank yourself time and time again for avoiding this kind of scarcity situation and living within your means.

Once you realize how important this is, you will be on your way to living an Abundant life. Soon you’ll have the resources to do what you want without putting yourself and your family in such jeopardy. Soon you won’t even think about keeping up with the Joneses because they will be the ones trying to keep up with you!

Open Thread Friday

2006-06-02T17:15:00.000-06:00

We know that we are just starting with few readers, but we want to make this a regular feature. Open Thread Friday. From today until Monday, ask any question you like and we'll do our best to answer it!

Thanks!

Celebrating Wealth

2006-06-01T11:47:00.000-06:00

We celebrate wealth! It is good to be rich. It is good to have a lot of money and spend a lot of money. Nothing annoys us more than when people complain about the way others spend their money. We love big, opulent homes, audacious yachts, extreme supercars and more. It’s all part of our philosophy of living Abundantly.

Forbes recently had their list of most expensive yachts of 2006.

Following a few years in the doldrums, yacht orders were up 28.4% for 2005, according to Showboats International. While the current year's uptick was a bit less, the 7.9% rise in orders for 2006 is still impressive, especially in the face of rising fuel costs. To put it another way, there are currently 81,852 feet--or 15.5 miles--of yachts either contracted or under construction around the world. That's a lot of boat.

Things are looking especially good at the large-scale end. "Sales have not waned," says Diane Byrne, executive editor at Power & Motoryacht magazine, who compiles the publication's annual and highly anticipated list of the World's 100 Largest Yachts. "The upper end of the mega-yacht market never gets affected by things such as rising fuel costs or faltering economies. In general, the customers who are buying such yachts have already set aside the money."

Meanwhile, some 5,000-6,000 "mega-yachts" -- those leviathans of the sea that start at 80-or-so feet and can reach more than 400 feet in the hands of the right billionaires -- currently crowd the seas. And they're getting bigger all the time. "Top shipyards around the world that were turning out 150-foot yachts just a decade ago are now looking to build yachts of 250 to 300 feet," notes Byrne. "It's astounding."

This is amazing, amazing and wonderful! These people are living Abundantly. They understand what it takes to be wealthy and to gain even more wealth. They realize that money is meant to be spent, and they are doing just that! They are allowing money to flow through them to others where that flow will continue.

Just think of the number of people it takes to build one of these yachts! Consider all the furnishings, the wood, the metal, the gadgets and the list goes on. Thousands of people are involved in the process; thousands of people whose lives are blessed and enriched because one wealthy person understands Abundance. Let's take a look for a moment at one of these gorgeous vessels.

Alysia

$116.7 million

Launched in 2005, the Alysia is a whole lotta boat--for a whole lotta money. Built by Neorion Shipyard on the Greek island of Syros, the 280-footer sleeps 36 in 18 cabins upstairs, with room for 34 crew members below. The interior, by Alpha Marine Design, is long on luxury; twin 2,750-hp Caterpillar diesels have a range of 7,000 nautical miles and can keep the ship tooling along at 16 knots, or take it up to 18 knots in a pinch.

Amazing! She is a beautiful vessel. Just think how many people she will employ after the thousands who have already been blessed by her being built! This is an Abundance creating MACHINE!

So what is the point? I'm sure this article might have shocked some. They think of people buying yachts as EVIL. They are WASTING their money. How dare they spend it on such a frivolous item when that kind of money could do so much for the poor. Frankly, we're tired of people thinking like this. It is a scarcity mentality that locks you into your current situation leaving no room for growth. Abundance is really simple. Spending money is good. When you spend money, it goes to enriching others. The money continues to flow and a variety of people benefit. Get rid of that old way of thinking and realize that being rich is good. It is the rich and wealthy that have the ability to change the world for the better. They have the resources to help those in need and the vast majority of wealthy spend a great deal on charity. But charity isn't what is going to make things better. Allowing others to work, earn a fair wage and in turn spend money themselves is what this world needs more of. Buying a yacht is just one of those things as an example. Wrap your mind around that. Spend some time really thinking about all that benefit from just one yacht being purchased. The numbers are truly astounding. Once you can do that, once you can realize just how great a thing this is, then you will begin to live Abundantly.

2006-05-31T16:13:00.000-06:00

Borrowers are up in ARMS and that is a BAAAAAD Thing!

What are you people thinking? Do you think you are fooling anyone? Well let us clue you in, you aren't! Folks, come on, pull it back and re-examine where you are. Don't base your mortgage on what you can borrow or if you can make the payments now, but on what you can afford to borrow. Affording includes the ability to pay off the debt not just maintain the debt. So, what are we ranting about? We are ranting about this:

With interest rates rising, fewer people are applying for new mortgages - just as you'd expect.

But here's a worrisome surprise: More of the applicants are seeking adjustable-rate mortgages that could saddle them with bigger monthly payments if rates keep going up.

Clearly, many borrowers are using adjustable loans, or ARMs, to borrow more than they could with fixed ones. That means they may be taking on more debt than they should.

This is wrong on so many levels. These people are getting into places that they can't afford, not only with the mortgage but other payments as well. Let's face it folks, a larger home means more expensive all the way around. More electricity is used, more gas, more water. Your taxes will be higher. The list goes on and on. It isn't just the mortgage, which is bad enough! We're appalled at thinking what you will try and do when that ARM goes to 8, 9 or 10%! With rising interest rates many with ARM’s are actually becoming upside down with their mortgage. Frightening! It's time to take a deep, deep breath and re-assess your situation. Purchase a home you can afford and if you plan to stay in that home one that you can pay off. Choose to own your life and not just get by we promise you the feeling of owning your life will be much greater then just having a bigger house. There are some situations where ARM’s can be a good but as a general rule stay far far away from ARM’s.

Read the rest of the article, the author feels the same way we do!

Question? Comment? Request?

2006-05-30T16:26:00.000-06:00

As we are just starting this blog, we would like to ask if you have any questions, comments or something that you are interested in hearing about from us. If so, please leave a comment.

Lessons From a New Retiree

2006-05-30T15:19:00.000-06:00

Albert Crenshaw, a long time columnist for the Washington Post on all matters financial, is retiring. We'll hate to see him go as he has given wonderful advice over the years to the average worker. While we haven't always agreed with him, for the most part, his advice has been sound. With his retirement, we want to feature his final column.

Today's twenty- and thirtysomethings, more than any generation since before the Great Depression, seem destined to be left to their own devices when it comes to reaching their financial goals and securing a comfortable retirement. People this age have time -- time to save, invest and build assets. But they must have the discipline to do it. And that's no small matter because, for many lower-paid workers, the necessary savings will require economic sacrifices throughout their careers. It won't be easy, but it can be done.

Wow, isn't this the truth? If you think that the government is going to be there for you when you retire, you are seriously mistaken. It is up to you and you alone to be ready for that day to come. Not only do you need to plan long term, but short term as well. It is very important that you be financially fit from a young age. Youth today think they are bullet proof, they aren't. Situations arise, illness, injury that can force an early retirement. Are you going to be ready? If instead of 65, you were forced to quite working at 45, could you handle it? Do you have resources in place? the bottom line is the time to start is NOW!

All those books and articles you see about squeezing everyday expenses to generate savings are right. Almost everyone who has a job can manage to save a little every day. Simply substituting a Thermos of home-made coffee (tea is even cheaper) for the $3 latte could generate $500 a year, a good start on an individual retirement account.
But while the savings strategies work, they work best if you combine them with serious investing.

Yes! You can find money out of you current income. Do you know where your money is going every month? If you take the time, and track where your money is going each month you will be amazed at the amount of waste there is. If you truly are someone who has no waste as you assess where your money is going you can determine if there are things less important then building your financial security and you could redirect your money. Without causing a serious change in your life, you should be able to find a few hundreds of dollars every month out of your current income.

So what do you do with this money? This isn't your new entertainment fund. Sorry. You use this money to first, build a savings account in case of emergency, second, you pay off ALL of your debts, yes, all of your debts including your mortgage. Any that have worked with us know our system. If not, feel free to drop us a line and we'll clue you in. Finally, after all those debts are gone, including the big bugaboo, your mortgage, you can then start investing. This is a sure fire plan and one that will swiftly take you from in debt to on top of the world!

It's fashionable these days, in an era in which many marriages break up, for couples to keep their finances separate. Two checks for the rent. Splitting the dinner tab. His and hers bank and investment accounts.

My experience is that couples who act as a single economic unit do better. Ideally, young married couples should aim to live on one salary and invest the other. Not only does that seem to result in faster saving, it compels the couple to confer about their spending and investment. It's not his money, not her money -- it's our money.

If a husband and wife can't agree on money matters, their chances of staying married seem to me highly problematical. Operating separately may sweep disagreements under the rug, but they won't stay there. Marriage is a lifelong economic joint venture, and like a commercial merger, it won't last long if the partners think they're in different businesses.

BRAVO!!! A marriage is a partnership, it should be the strongest one you have. If you have been lying to your spouse about money, STOP IT! You are in this together, both good and bad. You need to work together on it. There is nothing more pathetic than when a spouse dies and the one left has no idea about the money, how much is left, insurance, investments, etc. It needs to be done together. Money will rip a marriage apart faster than anything else; it can also be a reason for a strong union. When finances are worked on together and both know where all the money goes, a major focus of contention is gone and a major stress on the marriage disappears.

The things we buy fall into two categories: those that lose value or disappear, and those that gain value. Borrowing to pay for the latter -- a house, a college degree -- is a likely to be a winning proposition. Borrowing to pay for the former -- a vacation, a pizza on a credit card you don't pay off -- at best makes these items much more expensive; at worst it's money down a rat hole.

The moral here is not to fear debt, but to use it wisely.

You know, we knew there was a reason we liked this guy! Again, he hits it just right. How many of you are still paying for that steak dinner from 1998 you put on your credit card? Remember there is a big difference between Debt which is borrowing money to buy things that decrease in value and leverage which is using other people’s money to make money. To many judge their monthly out flow by how much income that is coming in plus available credit lines. This is false affluence and will only lead to financial ruin. Get your education and don’t confuse debt with leverage. Buy that house; just pay it off as quickly as possible. Go to that expensive restaurant if you have the cash or have the ability to pay off the card you are using. Don’t go if you have to put it on your card because you lack the cash. Eat in or find a place that you can afford. It is easy to rationalize and say, "Just this once..." but that turns into one more and another here and one there... it never ends. You are better off to never let it get started. Decide today to taking small steps that will over time dramatically improve your financial life.

We recommend the rest of the article to you as it is chock full of good advice. We wish Albert a wonderful retirement; his words of wisdom will be missed by all of us.

2006-05-30T11:52:00.000-06:00

Haloscan commenting and trackback have been added to this blog.

Dwindling Incomes the Problem? We Think NOT!

2006-05-26T14:38:00.000-06:00

We ran across an interesting article the other day and thought it might be a great way to start off this adventure in blogging. It's a perfect example of what is going wrong in the world today with personal finances. Let's look at part of the article.

The article begins by discussing how mean income has declined since 2000.

One thing that sours working Americans is the feeling that they're losing spending power. After a recent speech, White House Deputy Chief of Staff Karl Rove fielded a question about why median income in the United States has declined since 2000, the year President Bush took office. Mr. Rove cited an increasingly youthful work force, with its generally lower overall pay, as the main cause. His implication: Aside from those low-wage earners, real income is on the rise or holding steady among older age cohorts.

That observation raised a red flag for researchers at the Economic Policy Institute, a labor-oriented think tank. The EPI believes that Mr. Rove has his facts skewed. Between 2000 and 2004, the institute finds, income fell an average of 3.6 percent for six of seven age groups ranging from "15" to "65 and up." Only the 55-64 group, representing just 15 percent of households, saw incomes rise--a modest 2.4 percent. The EPI also hits Mr. Rove's suggestion that more households are headed by young wage-earners. It finds, on the contrary, that the share of households headed by workers younger than 44 is down 2.3 percent since 2000.

Ignoring what might be the cause of a declining median income, we see that people are making less money depending on which age group they are in. So, what do people do when they make less money than before? What do you do? The intelligent answer, the obvious answer is spend less money. You aren't making as much so you spend less. Seems obvious, right? WRONG!

Yet Americans are so disinclined to "do without" that curtailing the spending habit seems to be a last resort. Instead, many of us opt to increase personal debt. Federal Reserve statistics show that Americans, at the dawn of the Bush presidency in 2000, were keeping their consumer debt to 96.8 percent of overall disposable income. Five years later, Americans' total debt is 127.2 percent of their income.

Many of us, quite clearly, have chosen to spend well beyond our means. Dangerous.

Moronic! This isn't just dangerous, this is fiscal suicide. It goes beyond that as well. Not only are we destroying ourselves financially, we are destroying our lives. This kind of debt is what breaks homes, destroys relationships, brings on depression and a myriad of other difficulties. Why is this happening? Before reading that last paragraph, any normal person with half a brain would say that when you make less you spend less. Yet, that isn't what we as Americans are doing. Instead we are putting ourselves into bondage to those we get the money from, banks, credit card companies and other loan institutions. It's just insanity. Unfortunately, 99% of us don't know any other way to live. We've been taught that debt isn't bad and it is important to have the latest computer, stereo, entertainment center, etc. etc. etc.

It's all so deceptively easy and those who control the money we are borrowing just keep sucking us in. Credit cards and their "priceless" memories makes it seem that we aren't living if we don't spend what it takes for a few fleeting moments of pleasure. Even our bank just sent us an advertisement to get a 'youth credit card' for our children so they can learn to use credit wisely. GAHHHH!!!!

Folks, this isn't about learning how to manage our debt. It's time to get out of debt, completely. It's time to teach our kids and those around us that 'net worth' is more important than 'credit rating' when determining value.

This is what we are going to be talking about as we continue to blog. It's far past time for us to wake up and realize we've been duped! It's time to get out of debt and start living abundantly. It's time for people to realize that no matter how much or how little you make, the first step to being financially independent and debt free is changing the way we think. People think if they just made a few more dollars each paycheck, all would be fine. WRONG! Unless thought processes are changed, that money would be spent and gone without our even noticing it. Think winning the lottery is going to solve your problems? NO! Not unless you change your thinking. Studies have shown how lottery winners many times have it all spent and are back in debt within years of their winning.

Thinking Abundantly and living Abundantly. That's what it's all about. Go back and read that paragraph quoted from the article above. Spending 127.2% of income. That is the problem. It's not how much money you make that really makes the difference, it's how much money you keep! The cure? A massive change in the way we think. If this doesn't happen soon, this nation is in for some serious problems in all aspects of life. Time for you, each of you, to take a serious look at yourself and see if you are part of the problem or the solution and decide today to change the way you think and act about money!

Let the Abundance Blog Begin!

2006-05-26T14:35:00.000-06:00

Hello and Welcome! This is Kathryn Merritt and Dan Smith, founders of the Smith Merritt Institute, a financial education company. Wow, there's a mouthful. We're pleased now to start this blog where we plan to comment on financial issues in the news and those that are close to us. We hope to make this a fun experience where comments are welcome and ideas flow freely.

We were looking for a way to be more accessable to the public, where anyone could make a comment or ask a question, and looking at the various ways to do this, decided on blogging. Feel free to play rough and tumble, challenge us, ask us questions. All we ask is you keep it polite. No foul language or rudeness. We love a good dialogue and we love explaining why we believe the way we do. Still, we do reserve the right to edit posts if we determine them to be offensive.

So, let this grand experiment begin!