Life

Saturday, September 22, 2012

How Dividends Work

I am a huge fan of dividend paying stocks. I like companies that are paying back their investors now and only use their investor's money so they don't get into a situation where they have a deal on the table that they can't do because they don't have the capital to back the deal.

So, let me talk a little about how dividends work. This discussion is inspired by a talk with a good friend who asked me why a person would not just buy a stock before the dividend paid out and then sell the stock after the dividend paid out. He also did not know about the x-dividend date, so I will clarify that here.

If a stock pays dividends quarterly, the board of directors will meet after each quarter to declare a dividend (or decide not to pay a dividend). In this scenario, I will just assume the second quarter has finished and the board of directors are meeting on July 10th to declare a $1 dividend. We can just call July 10th the "meeting date". This means the company will pay $1 to each shareholder for every share owned. In the meeting, let's say they also decided to make the "record date" on July 20th and the "payable date" on July 30th. Then, the "x-dividend date" is July 18th, which is determined by FINRA to be two business days prior the "record date".

June 30th - End of second quarter
July 10th - Meeting date (determined by board)
July 18th - X-Dividend date (determined by FINRA)
July 20th - Record date (determined by board)
July 30th - Payable date (determined by board)

If the stock cost $50 per share on July 17th, the price would automatically be adjusted to $49 per share on July 18th. Whoever owned the stock on July 17th would be paid the $1 dividend, even if that person sold the stock on July 18th. The owner of the stock on July 17th would be recorded by the company as the owner of the stock on July 20th and would be paid the $1 dividend on July 30th.

The important thing to note is that you do not want to purchase the stock on July 17th because you will buy the stock for $50 per share and then be paid a $1 dividend per share and then taxed on the $1 dividend per share. It is better to purchase the stock after the "x-dividend date", once the stock has been discounted to $40 per share.

Support My Mission

1. You can support my mission by visiting http://www.izuservices.com and donating. A dollar lets me know you support my mission or like my posts. Thank you for those who have already donated.

2. Donate to SAGE via http://sagescholars.berkeley.edu/. The UC Berkeley SAGE (Student Achievement Guided by Experience) is a self-funded experiential leadership program that provides education, professional development, mentoring and internships to UC Berkeley students who come from poverty and low income backgrounds. I serve on the Leadership Council for SAGE and want to help raise money for their cause.

3. Call toll-free (877) 855-8111 or log on to www.PrimericaSecure.com to save yourself some money on either your home or auto insurance policies. Be sure to use my last name (IZU) and solution number (2MTFT). PrimericaSecure automatically compares rates from multiple companies such as Progressive, Travelers, Safeco, Hallmark, etc.

Sunday, September 16, 2012

Izu's 100-200 Property Valuation Rule

According to the United States Census Bureau (reference), in 2011, there were about 312 million people in the US of which 38 million lived in California. In California, there were nearly 14 million housing units. According to an analysis done for San Mateo County (reference), in 2009, close to 503 thousand of these were pre-foreclosures and about 390 thousand of these were foreclosures. That means, nearly 892 thousand of the 14 million housing units or about 1 in every 15 homes was in jeopardy of being lost to the bank.

The statistics above state why I am such a fanatic about following specific rules when you purchase your home. I know that one of the four d’s (death, divorce, disease, disaster) could cripple you down the road. While many renters feel their entire rent is going down the drain, in reality only a small portion of the rent money is paying down the house. When I purchased my first home, I estimated only saving $70 a month based on tracking expenses, even after factoring in the equity being built (this is plenty when you are actually ready to buy, because you will be getting rich slowly). In addition, renters have the flexibility to move in case they lose their job and they can find a cheaper place to live if necessary. So here are my rules of thumb for buying your home:

Only purchase after your car loans, student loans and credit card debt are paid off.
Don’t purchase over 3 times your annual household income.
Put 20% down on your home.
Don’t pay over 200 times the monthly rent in the area.

When it comes to business ventures, leveraging can be very profitable. However, if you are a new investor, at least for the first investment, I would modify these rules:

Put 25% down.
Don’t pay over 100 times the monthly rent in the area.

Lets look into where the numbers 100 and 200 come from in the 100-200 rule.

During March 2012, the California median home price for single-family detached homes was $291,080 and average interest rates for thirty year fixed mortgages were 3.95 percent (reference). So typically, people are paying $1381.28 for 360 months. That is $497,261 it total payments and $206,181 in interest over 30 years.

Interest rates these days are very low but historically, they have not always been this low. Holding a 9% interest rate would mean paying 190% in interest which means almost paying 3 times what the home is worth over 30 years!

California counties collect an average of 0.74% of a property's estimated fair market value as property tax (reference). The average home insurance rate was $803 (reference). Average maintenance costs for home owners are about $672 for the year (reference). In addition, home owners tend to tack on projects around their home, which I will assume cost about the same as maintenance. Based on these numbers, one can expect to spend 1.5% of their home price yearly to cover property taxes, insurance and maintenance.

Suppose you see a home that rents for $1455 a month and you are interested in purchasing this home for personal use. Then, I would advise not paying over $291,080 for this home, using the 200 factor from the 100-200 rule. The reason is that every month, you should expect to pay $1381.28 to your mortgage company and $363.85 for additional expenses. This is a total of $1745.13 a month. Many people make the mistake of thinking that since the mortgage is lower than the rent, they have a good deal. Making a mistake here and losing this home would cost you about 11% of your home price (loan closing costs, legal fees, buyer and seller commissions) which would be about $32,019 for an average home in California.

Following my 100-200 rule gives you staying power. It allows you to hold the home long enough to have something great happen, like appreciation. Banking on appreciation because you know house prices will go up is gambling. Doing the numbers ahead of time and make sure you can afford the home is good business. Later, people will say that you are lucky, when you know different. You have planned ahead of time, just in case you hit some hard times. Doing this, I have no doubt you will get lucky and when you move into a bigger home, you will have rental property which still fits the numbers. This means rather than selling and losing that 11%, you now have an investment property, adding an asset to your collection.

As a landlord, one should factor in repair costs, appliance costs and additional costs (changing tenants, new carpet, painting). A renter should also assume 2 months of vacancy per year. If property management is involved, one might also include a $300 lease fee and 10% of the monthly rent going toward property management. In addition, unlike owning the home, an investment property should make a return like 2.5% of the property’s value (this is 10% of the 25% down). Using the 100 factor from the 100-200 rule, the same home which rented for $1455 a month, should not be purchased for more than $145,500 as an investment if you expect to make a good profit. Many investors just hope to make some profit. However, it is a good idea to compare to expected returns with the returns expected from other investments.

In terms of taxes, rental income may be considered active income if this is your job. Otherwise, it is passive income. This is important to calculate your depreciation deduction. In general, active income can offset active income and passive income can offset passive income. If you make major decisions, you might say that you actively manage your properties, but the income is still considered passive. This is a whole blog topic in itself, so I won’t cover it. In either case, both depreciation and appreciation should be considered icing on the cake and should not be factored into the equation, because one might not ever see these benefits if they can’t own the home long enough to see them.

Support My Mission

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Tuesday, September 4, 2012

My Personal Proclamation

See, I learned something at a very young age. If you asked people who knew me growing up, they might tell you that they noticed something different about me. What I learned has manifested itself as a truth throughout my life as I put various principles into practice and worked to achieve my goals. What I learned will be present in what I write here and some may see it, some may not.

I am going to build one of the largest brokerages in San Jose. I am willing to put my reputation on the line and risk everything to do it. I want to let people know now, before I have any major successes, because I don’t want someone to be able to say that I was lucky. I want people to know that it was planned from the beginning. I have written my one page business plan. My goals may seem impossible, but they are just improbable, not impossible. My goals are meaningful specifics and I will be reviewing them often, possibly changing them and improving upon them. I have a game plan to succeed. The only question I have is “How long will it take?”

I have always been a teacher. I love to share knowledge and will continue to do so. In high school and college, I tutored others, so that I could share what I had learned. I think that if we build upon the ideas of each other, our society will benefit. I refuse to hog knowledge, even though I know knowledge is power. I have been willing to publically post my successes and failures, along with various ideas, in hopes that others will benefit.

For two years, I wrote in my blog about various topics, a majority of them being finance related. About 4 months ago, in May of 2012, I started sitting down with clients for free to offer financial advice on various topics. I did this for free because I felt I had abundance at the time and I wanted to start giving back to the community. It was during this time that I was offered a whole life insurance policy. Then, I became aware of three major disasters occurring in our society: stock market disaster (stock crashes of 2001 and 2008), real estate disaster (subprime mortgage crisis) and life insurance disaster (80% of people owning whole life policies). Three is a magic number and enough to make me devote my life to educating people about each of these areas.

Unlike most people, who get recruited by Primerica, I was looking for Primerica. As soon as I saw what the company did, I hopped on board. In my eyes, the company does 3 things as stated in their mission statement: “Help families become properly protected, debt free and financially independent.”

Before I started with the company, I did a ton of research on the company. I also interviewed clients, previous business owners and people who had been approached by business owners within the company. What I found were almost all people who know the company will say the products are great. Some struggled with the business model. For me personally, it comes down to ethics and values. On two occasions in my life, I have had to say the following: “I will not take a job, even if it means doubling my salary, if I do not believe in what I am doing.” Although, I might have profited greatly, that was that. In addition, a non-conventional business model means those that normally might struggle to find jobs can actually generate income. I’m sure some stay at home mothers could use some financial education and some extra income based on working with only two clients a year.

In high school, someone once asked me, “How are you able to stay so happy?” I responded, “Everyone has a choice. I choose to be happy.” I was fortunate to have been taught many great principles while growing up and even more fortunate to have learned many great principles throughout my life. Primerica is an interesting company that is dedicated to self-development. The interesting thing is that even with Primerica throwing out the keys to success, people can still fail. This is because people must first be open to receive before they can learn. My brother (Kevin) often says, “You can’t change people. You can only make it easier for them to change.”

Primerica offers a great business opportunity. However, this opportunity is not for the faint of heart. Only 1% of the company makes a six figure income. For everyone who starts training only 20% get licensed. Furthermore, 60% of the business is done in house. Still, if you knew what I knew, you would do this business. I know 70% of businesses fail, 90% of small businesses fail. In a calculus class I once taught, over 50% of the students either withdrew or dropped out. Unlike other businesses, this is an excellent business to fail in. Even those who fail may learn information that can save thousands, tens of thousands or hundreds of thousands of dollars, depending on what they are able to pick up while they are here.

I know that the best way to learn is to do. I will partner with people and families one on one to help them succeed. However, I can only influence so many people. What I really want is a team, an army of people devoted and dedicated to financial education and bettering our society. We are swimming against the tide. We are battling advertisements and marketing agencies. We are exposing potential issues with banks, credit card companies and insurance companies. I cannot do this alone and I am willing to learn what is necessary to guide my team. I have a voice and it will be heard.

There are three articles which I have read which would deter most people. These are great articles by the way, with many truths:

Even reading these, I find myself not moved but stagnant in my position. If you really look at various companies, what Primerica offers is completely opposite, like night and day, even though other companies seem to be similar on the outside. Primerica was built based on the crusade to stop life insurance companies from ripping off people, whereas some similarly structured companies continue to rip off middle class families. Years later, Primerica has expanded to include products to help people get out of debt and save for retirement. To me, this means the company has branched out to further their crusade, almost completely in line with the problems I see.

When people believe in what they do, an almost cult like organization is formed. When people have such strong beliefs and a single mission, they can move beyond their individual imperfections and work together to achieve a common goal. As people leave the organization, the crusade lives on, because at the end of the day, others still believe in the mission.

While some may be concerned about what they can get today, I like to let the marshmallow sit on the table, thinking up ways I can add more value to society. I like to build up a foundation of small bricks which will show returns in a residual fashion. I have a vision to build something great and realize it starts with the laying of a single brick. If I can build it right, it will stand forever.

Support My Mission

1. You can support my mission by visiting http://www.izuservices.com and donating. A dollar lets me know you support my mission or like my posts. Thank you for those who have already donated.

Monday, August 27, 2012

The Second Tier of Building Wealth

The second tier of building wealth is learning how to have your money make money. If you don't know how to earn money, you won't have any money anyway, which is why the first tier is so important.

Managing Your Money

The first part of this tier is learning how to manage your money. Rather than flying by the seat of your pants, it is important to have a game plan and set goals. Learning how to make a budget and having the discipline to stick to that budget are key.

"A penny saved is a penny earned."

"Those who make 4 dollars and spend 3 will always be better off than those who make 5 dollars and spend 6." - me

“Most people don’t receive a formal education about financial matters, but it’s an important life skill.” - http://www.northbaybiz.com/General_Articles/General_Articles/Amazing_Savers.php

Avoiding Debt

Debt is a cancer. Debt is a disease. It affects stress, health and relationships. On the national scale, we are about 70 trillion in debt, if we include future debts such as Social Security and Medicare (http://www.truthin2008.org/"http://www.truthin2008.org/). On the individual level, "Credit card debt is the third largest source of household indebtedness, averaging $15,587 per indebted household as of June 2012" (http://www.nerdwallet.com/blog/credit-card-data/average-credit-card-debt-household/). While some people believe debt increases productivity, I think we should be attacking the statistics above head on.

People often get upset when taxes are raised, yet will gladly pay a 3% tax to use their credit cards. Of course credit card companies are smart so they charge businesses and people think they are not being charged if they pay off their credit cards on time. Even worse, people don't pay their credit cards off each month which leads to 10%-25% in additional fees.

A quick side note. There are arguments that businesses should have debt because they leverage money and increase investor returns. I absolutely believe in the power of leveraging money, but that is another blog posting.

Create an Emergency Fund

Everyone should have 3 to 6 months of living expenses saved up for emergencies. I have heard it quoted that for every $10,000 in your annual salary, it may take a month to find that pay in a job, if you were to lose your job. That is, to find a 100K job, if that is your salary, it might take 10 months to find that job. In addition to losing your job, you may have to replace your car or take care of another emergency.

If you do not have an emergency fund and have credit card debt, I would advocate eliminating your credit card debt and building an emergency fund at the same time. An emergency fund can be placed in a checking, savings, money market account or certificate of deposit. This purpose of this fund is not to make money, but be liquid, meaning that you have access to the fund within a week's time frame.

Playing the Money Game

Once you have followed the above rules, you will be able to start playing the money game. You will become a lender and not a borrower. That's right, I said you be the bank. Rather than give the money to the bank, find out where the bank is investing the money you are giving it. I think that its very sad that we have become a society where we go to the bank to get loans, rather than visiting that rich uncle. What has happened to the strength of an individual's word? Why not register a promissary note which is based on a mere handshake?

Besides, the emergency fund and the 529 plans for college savings accounts, you should have a couple more buckets used to build your financial house. Diversification is an important word. For those who had all of their savings in mutual funds or stocks in their 401(k) plans in 2008, they may have had 50% of their estate taken out. On the other hand, suppose you had something like a 50% real estate, 25% stocks and 25% bonds. Now, imagine you lost 50% in stocks. This means you really only lost 12.5% of your estate.

Any well built financial house will include a diversified portfolio along with tax considerations. It will also include considerations on liquidity (like short or long term).

More importantly, realize that "No one will protect your money better than yourself." If your financial planner is not teaching you about money, they are not doing their job. A good financial planner will give you information and then let you make decisions about your money. They will not give you a single option and tell you that its the perfect plan, because no one can predict the future. Rather than pass the buck to your finanical planner, learn enough to be able to ask the right questions.

Most people who lost money in real estate, lost because they didn't know how to evaluate home prices or do other number crunching. This is true because over the past ten years while many were losing, those who knew were still making money. It is shocking to me that right after the sub prime mortgage crisis, people are still putting 3-5% down on homes and taking out a 30 year loan.

Most people who took a huge hit in stocks, also lost because they didn't know what they were investing in or how their investment worked. With the advancement of the internet, people can now invest in any publically traded company with the click of a button. They do not look at the investment, they just tell themselves, "Well, Apple is a great company with a great product." So, if someone told me that, I might respond, "If you had 1 trillion dollars, does that mean you would be willing to purchase Apple with that 1 trillion dollars?" It is shocking to me that right after the stock market crashes of 2001 and 2008 people continue handing their money off to someone who is making money whether they gain or lose money.

Whether in real estate or in the stock market, based on many people I have interviewed, I have found a huge difference between people who know how to have their money make money and people who don't. Those who do, often live by this phrase, "If the numbers work, I will do the deal. If they don't, I won't."

Support My Mission

1. You can support my mission by visiting http://www.izuservices.com and donating. A dollar lets me know you support my mission or like my posts. Thank you for those who have already donated.

Sunday, August 19, 2012

The First Tier of Building Wealth

Today, I want to start a discussion on the three tiers of building wealth. This will be a three part discussion, over the next few weeks. The first tier of building wealth is to maximize your earning potential. Be sure to check out http://www.thejobyoulove.com/, which has some related topics.

EDUCATION

Often times, people get to a point where they are happy with their careers and they become complacent. While they think they have made it, in reality, standing still is really falling behind. For example, if you fail to continue learning, you will soon be phazed out by new technology and new times.

By nature, life is progressive. While people have great value at each phaze of their life: baby, child, adult, parent, grandparent, they naturally need to progress to be the most valuable during each of these phazes. While children are innocent and full of love, one will not be very valuable as an adult, without maturing beyond their childhood state. For one thing, nature will not allow us to keep the innocence we had or let our love flow as freely because we will have impacting experiences in our life. However, if we do value these characteristics of our children, we can have an even greater impact based on how we mature as adults. Imagine, as adults, if we all behaved like children, how our society would be. Sometimes we do behave like children, but hopefully, we are seeking how to grow through life and its progressive nature.

One thing that amazes me is that many highly successful people mention how we should never stop learning. I read somewhere that 42% of college graduates, never read another book. On the other hand, you talk to world class athletes and they continue to train being coachable, which makes them the best of the best. You talk to successful CEOs and they talk about how they need to learn even more. It shocks me.

"The best entrepreneurs never lose sight of the big picture, and they never stop learning until they die." Marty Zwilling (http://articles.businessinsider.com/2012-03-11/strategy/31144567_1_big-picture-business-ideas-new-idea)

When I was a teenager, I used to say I wanted to get 3 PhDs. I didn't even know much of what that meant. Now, I say I will someday write a book and someday become a lawyer. This is the mentality of "Never stop learning."

No matter what you do in life or where you go, you can always learn. You should be learning through every experience in your life. Some people say "I don't know why I went to school, I don't even use my degree." I like to look at this a different way. I like to think that no matter what your degree was, it will always affect your earning potential because you learned things and had experiences that shape your life. If you start a new business and you fail, you should learn something which will help shape your future. If you attend a meeting and it doesn't apply to you, you should still try to pick up something valuable.

OPPORTUNITY

One should always be looking for new opportunities. I have talked about this in previous blogs. Basically, I strongly believe that people on average have a million dollar idea each year. Most people just don't act on it or aren't willing to apply the effort necessary to profit from that idea. As you live your life, you will constantly find something lacking as you try to accomplish what you are trying to accomplish. It may be something small, like a garden hose or coffee cup sleeve. Or it can be something big like software program to teach people how to sing. You can either continue on in your life, or you can perform a great service by trying to fill that void.

If you want to double your salary, you have to reinvent yourself. If you are making 25K a year and want to make 50K a year, you have to reinvent yourself. If you are making 50K a year and want to make 100K a year, you have to reinvent yourself. The reason is that part of the things you value and know have led you to where you are today. However, part of the things you value and know are also preventing you from reaching that next level.

If you are making $8/hr going to school, why not look for a job that pays $10/hr. When you find that job paying $10/hr, why not search for something paying $12/hr. Continue sharpening your skills until you get to where you want to go. I would even say, don't stop there. If you make $100K per year, why not try to look at what it would take to make $200K per year. If anything, do it because life is short and you want to challenge yourself to be the best you can be.

NEGOTIATION

Did you know, you can get paid more for what you already do? Negotiation is so critical in determining wages and salary. I once negotiated a 10K raise. I told my employer that I had no intention of leaving and that I loved what I did. I just added some information that gave the employer an incentive to give me a raise. In any case, you may be working at a job where your employer is making a profit from keeping you on board. If you learn some basic negotiating skills it can go a long way. Time and time again, I have seen the best people on a team have some of the lowest salaries, simply because they did not have the skills to negotiate.

Here are some quotes from a Forbes article I read: (http://www.forbes.com/sites/meghancasserly/2012/04/03/why-american-women-lose-negotiation-linked-in-career/)

1. "A new survey from LinkedIn reveals that not only are professionals uncomfortable with negotiating for higher salaries, roughly one in four of us are so anxious with the process that we’ve decided to skip it altogether."

2. "According to the numbers, fewer than 26% of women feel comfortable negotiating compared to nearly 40% of men."

Just a quick suggestion. When starting that new job, even if its the only job you have on the table, ask them to mail you an offer letter for you to look over the entire package. After they do, say it looks promising and you'll have to think about it because you really wanted to see such and such a number. Little things like this mean you will pick up the job either way, so you don't have to worry about not having a job, but they also mean you can get what you are worth. And by that, I mean, don't ever let some company tell you what you are worth. I know there is no cap on your potential. If you can speak English, your brain has enough power to do so much more than you realize.

Support My Mission

1. You can support my mission by visiting http://www.izuservices.com and donating. A dollar lets me know you support my mission or like my posts. Thank you for those who have already donated.

Tuesday, August 14, 2012

The Four D's and the Cycle of Life

From sitting down with people, I have heard many stories. These stories are what have inspired me to continue on my mission to sit down with people and help them sort through their finances.

In one situation, a person was pulling in close to a quarter million a year and now struggles to pay rent. In another situation, a person spent much of their career in software, only to be laid off and replaced by a younger engineer. In another, a small business owner had business booming, without enough people to handle all the work coming in. A few years later, the business had died down, close to only one tenth of the work from previous years.

It is surprising how different we all are, yet how similar we are. We all tend to feel the same feelings and go through the same things in life. I love to speak to older people and learn about their experiences. You would be surprised what people have done in their life, if you only take the time to ask and listen.

As an investor, you can be paid well by learning to solve people's problems when one of the four D's occurs. Here, disaster typically means something like fire/earthquake, but you might also include being fired or losing a job.

Death
Divorce
Disaster
Debt

All too often, I speak with people who say they are doing well. I think that is great and of course hope that life will continue to be well. However, I hope that people can "Hope for the best while planning for the worst." When times are good, enjoy them and put some money away for a rainy day. Remember, you are one event away from a financial disaster and unfortunately, the statistics are not on your side. Can you honestly look at the list above and say you don't think any of those things will affect you in your life? What about the next few years?

I'd like to give a new interpretation to an old parable. What I love about parables is that they have different meanings for different people. The parable I am interested in is the parable of the ten virgins. Most people think that this has to do with the second coming or when they death. However, I think of this having to do with life and its cyclic nature, since when one of the four D's occurs, the bridegroom tends to arrive right at the front doorstep.

So, while you are thinking that your life is going well, I want you to just take a second to think. Does that house you are looking at fit your budget? Do you really need that new car? Do you already have furniture that you can be happy with? If you can answer these questions correctly, then maybe true happiness will enter your life when you are able to help your loved ones through hard times.

“At the end of the day, the questions we ask of ourselves determine the type of people that we will become.” – Leo Babauta

While some ask themselves, if they will be successful, I ask myself, when I will achieve success. That is why I can achieve anything I set out to achieve. People who know me well, know this about me. In the last year, I was involved in a 3 mile river race, in which our boat fell apart and all hope was lost. Most thought I would quit. Most thought I wouldn't get to the 1 mile mark. But then again, most didn't know me. It was said of me, "I don't know when he will finish, but I do know one thing. I know where I will meet him to pick him up." I never asked myself if I would finish the race, I just asked myself how long it would take.

So maybe the questions above are not the right questions. Maybe you should ask, "Will this house provide the things you need, no more, no less, so that you can pay the mortgage in the next 15 years?" "Can you live with a slightly older car, if it means you can put extra money into your kids college fund?" "Would you rather purchase this new furniture set or be able to send your mother money if she loses her job?"

Support My Mission

1. You can support my mission by visiting http://www.izuservices.com and donating. A dollar lets me know you support my mission or like my posts. Thank you for those who have already donated.

Monday, August 6, 2012

The Get Rich Slow Scheme

So, the topic today is to address the idea of getting rich quickly and the concept of get rich quick schemes. Let's admit it. Sometimes people are lazy. Sometimes they want to maximize their rewards and minimize their efforts.

CHOOSE TO BE HAPPY

If you want to get rich quickly, you can. Its really simple. Close your eyes. Think of all the great things you have in your life. Despite your situation, despite where you are, you are already rich. Rich with many blessings you probably just don't take the time to realize you have.

"But whosoever drinketh of the water that I shall give him shall never thirst", John 4:14. I usually don't quote scripture because I'm not really worthy to but let me just throw it out there as it may mean something special to others.

Some people always want more. They want this or that in their life. No matter how much they get, they take and take and take. What I propose is that people choose to be happy, appreciate what they have fully and attempt to enjoy each day of life. If they do this, they should not find it difficult to live within their means.

MOTIVATE YOURSELF

One of the great things about all those get rich quick schemes out there is they are very motivational. Yes, I tend to see the positive in many things. Two of my good friends opened my eyes to Robert Greene's book called "The 48 Laws of Power". You can check this list out on wikipedia. When I first looked at this list, I thought, "EVIL!". I almost shunned away when I read some of this page because the idea of manipulating other people just didn't sit right with me. Then, I decided to read it so that I could protect myself from others trying to manipulate me. I don't know if this is just a euphemism, but I prefer to be an open book, providing information and let people make their own decisions. Now, I am not like most people, so I sat and thought about how these 48 laws could be used as something positive in my own life. Here is what I decided. People can be their own motivators. They can use the 48 laws of power to motivate themselves to achieve the goals they set out for themselves.

A great way to motivate yourself is to attend two professional seminars or conferences per year. You may come back refreshed and motivated. I like Robert Kiyosaki because he often knocks those with a traditional college degree. While, I am a huge fan of getting a traditional education, I also believe that one should never stop learning.

Despite how many achievements I have in life, or what I think I have accomplished, life always has its way of humbling me, sometimes with a devastating knock out. I spoke to an old gentleman yesterday and he told me a story of the Dalai Lama. About a business man who went to the Dalai Lama in search of advice and basically couldn't stop talking. The Dalai Lama proceeded to fill his cup of tea until it overflowed and continued pouring. The point was that the business man could not learn anything because his cup was not empty.

"Even the strongest current of water cannot add a drop to a cup which is already full."

"The most difficult subjects can be explained to the most slow- witted man if he has not formed any idea of them already; but the simplest thing cannot be made clear to the most intelligent man if he is firmly persuaded that he knows already, without a shadow of doubt, what is laid before him."

One great way to motivate yourself is to focus on your dreams and goals. Write them down. Usually, I have heard about a Harvard study about goal setting. I think this is a myth, but here is an interesting study: http://cdn.sidsavara.com/wp-content/uploads/2008/09/researchsummary2.pdf.

“Ordinary people believe only in the possible. Extraordinary people visualize not what is possible or probable, but rather what is impossible. And by visualizing the impossible, they begin to see it as possible.” – Cherie Carter-Scott

TIME VALUE OF EFFORT

Albert Einstein was quoted as saying, “The most powerful force in the universe is compound interest.” I want to take this one step further. "The most powerful force in the univerise is the time value of effort."

I often talk to other people about the revolutionary concept I like to call the "Get Rich Slow Scheme". It is not what you do over the span of a few years that makes the difference, but what you do over the span of your lifetime. Rather than try to hit home runs, learn how to hit a single and repeat the process. You may "fail" and if you do, learn from your failure and try again. Eventually, after years and years of learning, modifying, strengthening, you may just hit a home run. Once you do, you may just hit a few more. Like compound interest you will also find that your efforts tend to stack exponentially.

I guess it is ironic that I have always been very happy with what I have had and at the same time been motivated to grow and build more. A somewhat zen concept of maintaining an abundance to help the suffering of those around me. This is thanks to those who have shared their abundance with me whenever I was suffering.

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