Category Archives: Planning

Is Being The Best The Most Important Thing In Life?

by

Some people are very competitive, even at an early age!

Here is my question to you, the readers: “Is being the very best the most important thing in life“?  After all, do you really think it’s healthy to be as competitive as Tonya Harding (see skating scandal)?

Why I ask this is because I see young kids on my son’s soccer team have different reactions when they lose.  Some cry, others yell at their teammates, some quit and some go to other cities to play.  The most ironic thing is that after all the little league, supposed superstars take such measures, they often leave a more cohesive team.  I believe this is one of the reasons that my son’s team won every game except one this season, and finished by winning the regional soccer championship this past soccer season!

Of course everybody on the team has to be a pretty decent player and play their hardest for that position they play.  But without the superstars trying to hog all the glory, the entire team improved as a whole!

The same is true with normal life!  You can’t fight a real war being a force of one, no matter what the movies portray (see the character Rambo in “First Blood“)…

So after your investment portfolio, business or whatever in life get to a certain size, it’s a smart move to hire help and/or join networking groups that can offer advice and support (see Yakezie).

-MR

Can Your Financial Body Fix Itself Naturally?

by

Be Financially Fix

I was complaining about my weight to a friend at work today, and he said something that stopped me in my tracks.  He said that he started working out a hour a day, and that this enabled his body to fix itself! 

I never really thought of my body as being sick, but what he said makes incredible sense!  After all, when I’m heavy, I’m more slow, get tired more often and have a tendency to take it easy, this is similar to the behavior I exhibit when I have a cold. 

So in the financial realm, spending (coughing) to excessively on unnecessary stuff and being in debt because of it, is like being sick!  When you are in debt, you eventually can’t do as much because you have your debt acting like a parasite sucking your money away… 

So what would the prescription steps to help your financial body fix itself? 

  1. Recognize that you are sick!  Do you constantly carry a high balance on your credit card (in total)?  Personally, if I carried a $2,000 balance, I would consider that as being sick, if you are higher than that… well…
  2. Go on a financially healthy diet.  Review the things you are buying and your expenses, then cut out the unnecessary ones.
  3. Exercise!  Find ways to make money (side jobs, etc) or play an even better defense by being even more frugal than typical!

If you do all three steps above, your financial body should be able to naturally fix itself.  I personally track my progress in a net worth spreadsheet much like I would journal my weight loss progress. 

Remember being healthy and fix is a life long endeavor, just like your financial fitness! 

-MR

The Difference Between Lifestyle Creep and Lifestyle Inflation

by

This is how I define the following:

Lifestyle Creep is when you expand your lifestyle by purchasing things or activities that are more expensive or better in some way.  Here is a list that I would use to describe events that can only be called Lifestyle Creep:

  • You go out and buy a boat, when you didn’t previously have a boat. 
  • You go skiing, which you’ve never done before.
  • You buy a third trophy car, but previously you only had 1 or 2 cars.
  • You buy a vacation home for the first time
  • You vacation overseas for the first time.

Lifestyle Creep is a superset of things you buy for the first time, and the set of items that “Lifestyle Inflation” represents.

Lifestyle Inflation is when you increase the cost of something that you have done before or owned before.  Here is a list that I would use to describe Lifestyle Inflation:

  • you have a small used cheap boat, and now you go out and buy a boat twice as expensive or better yet, a very expensive yacht
  • you replace your cheap watch with a Rolex
  • you replace your Chevy Malibu with a Lexus (wish I could…)
  • You replace your 36″ CRT Television set with a new 60″ LED HDTV.

With Lifestyle Inflation, you are replacing an existing object with one that is more expensive and usually better, an improvement.  All of these are also include in the Lifestyle creep catagory!

 

Why am I pointing these difference out?

I’ve been reading articles where people are using “Lifestyle Inflation” instead of “Lifestyle Creep” (or expansion).  And I just wanted to distinguish what I think the difference is between the two.

Today, there many misuses of the means of words.  For example when Columbus came over to the Americas, he called the native Americans “Indians” because he though he had landed in India.  Opps, very embarrassing, and yet we continue to still use that word to describe native Americans, even as it’s obviously incorrect.

Here are other ways we misuse words:

  • Turn on the TV– at one time TVs had a knob that you turned to make the TV come on.  Why do we still say this? (same with wall lights).  Wouldn’t it make more sense to say “switch on the lights” or “power on the TV“?  Foreigners probably think we’re stupid for saying it that way…
  • I got electrocuted touching that live wire – Electrocuted means killed by electricity.  The person is clearly alive though if they are telling us what happened to them…

Today I’m going to conclude by asking questions in the format that our friend the Financial Samurai would use:

Readers, With The Lifestyle definitions above, do they make sense to you?  Wouldn’t it make more sense to use the language in the truest meaning of our words, or should we continue to use them inaccurately? 

Do you think people just repeat and use what they hear even though they know that the word is being using incorrectly when someone famous say them?

Tell me if you think I’m being too picky or missing some bigger picture?

Thanks,

-D

Thinking about 2010 New Year, Random Thoughts

by

I can’t believe I writing this article on Christmast Day (for tomorrow’s post).

I only have 6 more days left of the 2009 year to formulate my plans for next year.  The following are just some random thoughts I’m having:

  • The MoneyReasons.com site hasn’t progressed as much visually as I had hoped, so that will be a top priority of the first quarter of 2010.
  • I’m thinking of developing a patternized posting format.  Currently (with the exception of a few series I have), I kind of write about what I think of on a day by day basis (kind of like living paycheck to paycheck).  I’ll be going for a more structured approach next year.
  • I still haven’t formalized (or organized) my financial plan for the extra money I’ll have at my disposal after our mortgage is paid off in Feb. 2010…  This is something I don’t want to rush in though, after all, this will be a new financial foundation for me.
  • I’ve been thinking of changing what I invest in for my kids, but this will take a back seat to my mortgage-free finance planning.  Besides they are in good stuff for now.
  • This might sound odd, but I’m excited about starting to get back into shape (diet and exercise) via frugal means.
  • I have to post a “Reasons to save Money” post soon.  I feel a bit like a hypocrite not having that list and having a blog called Money Reasons.
  • I want to be more socially creative than I am presently.  Writing to this blog (almost) daily, has improved my communications skills (I hope).
  • I definitely want to expand the Dividend/Goal Funds I’ve been working on…  See my Lunch Experiment/Spot Budget post for details of one such fund.

Well, back to Christmas for me 🙂

-D