Archive for the 'Finances' Category

May 5th, 2007

Financial Independence Series #4 – How To Get Started

Now that you’ve learned about what financial independence actually is, why you need to achieve it, and how to track it, you are probably wondering how you can actually get started. This is the concluding article to our 4 part series of financial independence.

Taking 1 Step Can Make You Financially Independent

In order to begin your road to financial independence, you first need to get started by actually doing something. It doesn’t matter if it’s a great investment, something that hardly gives you any monthly return, or if it turns out to be a flop. By getting started it’s like standing on top of the mountain and letting the snowball start to roll down for the first time.

Here are a few suggestions on how to get started:

  1. Real Estate – Real estate is one of the most stable and lucrative investment opportunities in the world. It has made more people wealthy than any other investment. All you need is a little knowledge, a few bucks in the bank (or none if you have a lot of knowledge), and some determination to get started.
  2. Build a Business – Whether you would like to run an online or offline business, it doesn’t matter. Just get something started that only takes up a few hours of your time each week so it doesn’t interfere with your current job. As it grows and exceeds your job income, you can replace the job with your business.
  3. Start an Information Website – This is possibly one of the best things you can possibly do. It doesn’t take very much money to get started and you can start today. When I started my first website, www.crazyfortea.com, I was a total beginner with absolutely no website experience. However, the company I went through eliminated all my fears and now I’m making a substantial income.The company I went through is Site Build It (Click On That Link For A Brief Tour Of How It Works). They provide every resource you can possibly need to build a money-making website. If you can type in English, you can own a website! The best part is, it’s almost unbelievable how cheap it is to get started. After only about 6 months of having the website online, I can now pay off the yearly fee in 1 month’s income. That means 11 months of free income for me for writing about something I love!If you have any kind of passion or hobby, I strongly suggest you try out Site Build It to start your quest towards financial independence.
  4. Invest In Stocks/Forex – Although investing in something like a mutual fund won’t give you a great monthly income, it’s still better than nothing. I personally invest in higher risk/higher rewards and have a trading adviser who takes his cut at the end of each month. I just started it this week so I won’t give a recommendation, but if you sign up for the RSS Feed or put your e-mail address in at the top of the page you can find out whether this trading adviser is worth the money.
  5. Invest In Other People – If you have a lot of money and don’t know where to put it, consider being someone who invests in others. For example, if I wanted to borrow $100,000 for a real estate transaction but didn’t want to go through a bank, I could get it from what are called “hard-money lenders”. These people lend their money out at high interest rates (generally 10-20%) and the other investor pays them that money back. If they default on the loans, you would pick up the property they owned in most cases (consult your attorney on how to properly set this up) – so it’s a win-win either way!
  6. Prosper - www.prosper.com is an online community in which you lend people other money, very similar to the example above. However, this is done through the Prosper company and it involves you loaning other people money for things they need, such as money to pay off loans, adding additions on to their houses, etc. I suggest only investing in those who are in groups because if the person defaults, the group will pay your loan back to you. I don’t believe this happens if they aren’t in a group.
  7. Invest In Yourself - Although it might not seem like it, investing in yourself can be one of the smartest things you’ll ever do. If you are still stuck in the mindset of “saving is the best thing to do” I recommend you read the books by Robert Kiyosaki. You can also read books or listen to audiotapes on real estate, trading stocks or Forex, or any other investing opportunity which will increase your likelihood of achieving financial independence.

Investing in any of those 7 examples is a great way to amplify the money you currently own. If you have a high risk tolerance, you might be better off investing in only 1 or 2 which can bring higher returns. If you don’t like risk, don’t feel as if you’re cheating yourself by diversifying – at least you’re doing something!

As I mentioned earlier, I personally believe starting a website is one of the easiest and best ways to start gaining passive monthly income. It takes some hard work, but the faster you grow your site the easier the work will get because of the amazing magic of momentum. To see why Site Build It is so amazing, go to this link – www.quicktour.sitesell.com

No matter what your preferences are, the important thing is that you start today.

Your perfect life awaits,

Jeremy

Read The Rest Of The Series:

Series #1 – What Is Financial Independence?

Series #2 – Why You Need To Be Financially Independent

Series #3 – Tracking Financial Independence


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By Jeremy in Finances,Financial Independence,Wealth Building  .::. Read Comments (6)

May 1st, 2007

How To Track Your Financial Independence: Series #3

After reading my first post and second post on the basics of financial independence and why you need to achieve it, you should have a good grasp on the concept.

You’ve probably realized that becoming financially independent is something that needs to be a necessity in your life, and hopefully you’ve already started to take action in achieving it!

In this post I’m going to be talking about how to track your financial independence so you can keep focused and work on improving your status every single month.

Tracking Your Financial Independence

Without keeping track of your expenses, income, and passive income, you are going to have a very hard time keeping focused and improving your wealth each month.

Here are 2 different suggestions that you might try to keep track of your financial independence:

1) Go to www.richdad.com and look around for the “cashflow 101 game sheets”. They are made for the game but are perfect for a beginner in keeping track of expenses and income.

I’ve been using these since I started my road to financial independence, and they are a great motivator. I simply put my name at the top, and the previous month (for example, today I just filled out exactly what happened in April).

You can put down what you’re making at your job each month, how much passive income (if any) you currently receive, and what’s in your bank account, stock account, mutual fund, CD’s, etc.

You also fill in all your monthly expenses, including things like credit cards, mortgage payments, what you spend on your children, car payment, school loan, etc.

Then you add everything together and subtract your expenses from your total income to see how much monthly cashflow you have. However don’t mistake monthly cashflow with passive income, because it’s not the same thing.

Becoming financially independent means that your passive income is higher than expenses, not that your monthly cashflow is higher than expenses.

For a beginner this is a great exercise to do each month, but I would recommend doing it with an excel spreadsheet, which is described below.

2. You can also do this using an excel sheet if you don’t feel like spending $10 or so for the cashflow sheets.

Open up a spreadsheet and put the current month in bold letters at the top.

Make 3 different columns – Expenses, Income, and Passive Income.

Then simply go down the rows and list each expense and how much it’s costing you each month.

Do the same for income and how much it’s bringing in each month.

Then again the same for passive income.

At the bottom add up your income and passive income and subtract it from your expenses to see how you stand financially.

You can also divide your passive income by your expenses to see exactly how far along you are. For example, my passive income for last month ended up being $345, and my expenses were $655. Therefore last month I ended up being 52.6% financially independent.

Comparing that to March, my passive income was $286 and my expenses were $706. By reviewing my expenses and figuring out ways to cut them down, I ended up reducing them by $51 per month. Last month I was only 40.5% financially independent so I made major progress in the month of April.

No matter which method you use, please make sure you start today. It’s the first of the month so it’s a perfect time, no excuses. By reviewing your financial status each day and thinking creatively on how to reduce your expenses or increase your passive income, you will gain momentum very quickly in becoming financially independent.

If you have any questions on how to set up an excel sheet, feel free to make a comment and ask. Sometimes they’re a little tricky to figure out so you might need some help.

Your perfect life awaits,

Jeremy

The Rest Of This Series 


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By Jeremy in Finances,Financial Independence,Wealth Building  .::. Read Comments (2)

April 26th, 2007

Why You Need To Be Financially Independent: Series #2

In this series I’ll be explaining what I believe will happen to families and individuals if they retire without being financially independent.

You can choose to believe me or refuse to accept these beliefs, but either way they are true. My goal is to put forth the best information I can to prepare people for what’s ahead of them. After that, it’s up to you.

The Danger Of Not Being Financially Independent

According to Fidelity, the average amount in a persons retirement account is a measly $61,000. Considering the fact that you absolutely need about $12,000-$15,000 just to get by in a given year at the lowest level of poverty, these people are in for a serious awakening when they retire.

They are relying on Social Security to help them survive through the times which they will refer to as their golden years. However, for the majority of people in the next few decades, their golden years are actually going to turn out to be something more along the lines of the Dark Ages.

Although Social Security was a great idea when it was first signed into law by Franklin D. Roosevelt, the implications it has for todays society has changed drastically. With the baby boomer generation retiring, there isn’t going to be enough money for everybody. Unfortunately, most people didn’t think anything like that could ever happen.

When Social Security eventually falls through, 2 things could happen.

  1. Millions of people of 65+ years are going to be working until the day they die and never get to enjoy retirement.
  2. The rate of homeless folks in the country is going to skyrocket, and poverty is going to be a major issue.

Even for people that are middle-aged now, this has major implications. Most people, my father included, think that Social Security is going to be a long-term solution to living a happy retirement. Although I’ve preached to him many times about it he still doesn’t believe me, probably out of fear that I’m correct. He just doesn’t want to accept it.

By looking at the facts and listening to many top economists around the country, there is a high probability that what I’ve just said is in fact correct. I honestly hope that I’m wrong, but what is the point of hoping that some kind of miracle will happen? You’re much better off getting started on creating financial independence for you and your family than relying on the government for anything – period.

Now on the other hand, what if your investments were making you just as much or more than your job was when you decided to retire? You could then live the same lifestyle, but have even more time to enjoy it!

Once the ball gets rolling, it’s hard to stop it. Compounding is a fantastic thing, which is why you need to start now on your quest to be financially independent. It’s amazing how much of a difference just a few thousand dollars or a year can make in how fast you accumulate money.

In my next article I’m going to talk about some of the things I suggest you look into so you can start to build your financial empire. Some of them I’m already involved in, some of them I will be involved in shortly but have studied them extensively. Everything is different for each individual person.

If you’d like to learn a lot more that is beyond the scope of this blog, please read “Why We Want You To Be Rich” by Donald Trump and Robert Kiyosaki. It will open your eyes up to the tragedy that’s about to happen in the next few years.

Your Perfect Life Awaits,

Jeremy


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