Real Wealth

Robert Kiyosaki, Rich Dad, defines being wealthy as having your investments exceeding your expenses.  This can be done through your own business or businesses, investments in the stock market, real-estate and/or minimizing your expenses.  The day you don't have to rely on someone else for enough of a salary to cover your expenses you're wealthy.

Changes to Calculating Credit Scores Pending in Congress

We can see how this will help most, but it will hurt some. 

More - Money Mistakes to Avoid in Your 20s

In the Market for a Car?

Buying a used car is likely the most cost effective.  Do your homework first, however, and make sure you're getting what you're expecting.

More - You Can Afford the Car But Can You Afford to Drive It?

Interest Rate? What Interest Rate?

The gap between 30-year fixed rates and one-month CDs or a saving's account rate is widening, making it more difficult for savers.  This especially hurts the middle class and retirees

Despite Washington's Best Efforts to Ruin The Economy

Retail stores are poised to hire temporary workers this holiday season.  That's a relief for many.  Expectations are that many of these positions may lead to full-time work. 

College Degrees Aren't Worth It

So say two-thirds of American.  68% believe that degree programs currently cost more than they are worth, and 36% said that the cost of a degree has risen disproportionately to its value in the last five years.

5 Retail Tricks to Turn on the Retailer

Retailing has become a science meant to induce you to buy more.  Here are tips retailers use on us that you can turn around and use on them and save money.

Know Your Goals and Stick to Them

In 2006, we got the bug to stop renting and buy our own home.  Who didn’t, then, right?  Like most couples, we wanted a place of our own.  We first educated ourselves on the process and the real estate market in the Denver Metro Area.  We didn’t want to live far outside because this is a great location between our work, family and friends.

We looked at homes in our area when there was an “open house”.  We distinctly remember one home located in Denver’s Capitol Hill.  It was going for just over $950,000.  We knew before walking inside that we couldn’t afford it, but we wanted to see it anyway.  It was a beautiful home with a nice yard.  The kitchen and dining room were recently remodeled.  We liked it, but it was more than we could afford and we decided to leave.

On our way out the door, we passed the selling agent.  She was a blond woman, about our age, lying in the recliner in the front living room.  While chewing gum, we swear, she asked us if we were interested in submitting an offer.  She had no clue who we were! One of us, we don’t remember who, said, “It’s a nice house, but we can’t afford it.”  In her best Valley Girl accent, she said matter-of-factly, “Just get a no-interest ARM.” 

It was all we could do to not laugh.  We were raised right.  What was she thinking?!  We were novices to the real estate market, for sure, but our backgrounds are in financial services and we had an understanding of how interest rates work.  Neither of us wanted to stress about where mortgage rates would be in five+ years.  Bill Gross can’t even predict that. 

After more self-educating, we did some soul searching.  We asked ourselves, “What’s most important to us?”  We had three objectives and still do; we want to travel, save for retirement and not be house-poor.  We have a tough time sitting at home and when we’re finally forced to, we want to do so comfortably.    

Based on our income in 2006, we calculated the maximum we could afford and meet our goals was $130,000.  You may think that’s a lot or a little.  We decided this would let us make monthly payments on a mortgage, while still having money to travel, save and enjoy our life. 

We searched far and wide and quickly learned it was hard to find a decent place for $130,000 or less in the Denver area.  We should, also, add that neither of us is particularly handy.  We can paint like bad-asses, but can’t do much beyond that.  Our real estate agent knew our income and frequently suggested increasing our maximum.  We held fast.  We knew what we could afford and were determined to make it work. 

After looking at several places, we found a condo we liked and would work.  Our negotiations eventually broke down.  We were frustrated.  We took ourselves out of the market for several months.  After time passed, we became re-engaged.  We started looking at homes and nothing suited us.  The more and more we thought about it, the more we wished our negotiations on the condo worked out.  We decided to wait for another condo in the same building to go on the market.  We practiced patience and eventually a condo became available.  This one was four floors higher and faced west, the opposite direction, with a city and mountain view.  It was much better than the previous place.  We submitted an offer and after some negotiating, our offer was accepted.  We closed on April 20, 2007.

We have a two-bedroom/two-bathroom, 1,008 square foot condo and a huge, west-facing balcony.  It’s small relative to most of our friends and family.  It was a fixer upper.  It still is a little.

 

 

Since our purchase, we’ve been to London, England; Ibiza and Sitges,Spain; Sydney, Melbourne and Cairns, Australia; Auckland, Waiheke and Kaikoura, New Zealand; two times to Puerta Vallarta and once to Playa del Carmin, Mexico; several times each to San Francisco, CA, Philadelphia and Hershey, PA.  While doing all this travel, we’ve saved a bunch for retirement and feel comfortably on track.  We’re meeting our goals.

To this day, we still talk about the real estate agent in that $500,000 house in Capitol Hill and think how bad our situation would be if we had taken her advice.  We’ve all seen the stories since 2008, so it’s not hard to imagine.

The point of this story isn’t to show off our great life.  We want to share what we learned.  The lesson we learned is that it’s up to each person or couple to decide what they want and make their life fit what they want.  Most of us aren’t rich and we need to weigh trade-offs.  For us, we need to decide what’s important.  We may need to practice patience, save extra money and ignore what others say.  If you want a house full of kids, do it, get earplugs and consider you may give up some things to fulfill this dream.  If you want a large, fancy house with no kids, that’s also great and you’ll likely have trade-offs, too.  If you want something else, don’t let other people’s objectives or dreams influence yours.

NFL May Stop Blacking Out Games

Because it's punitive and unprofitable.

If You Have to Ask Then, Yes You're Spending Too Much

A list of five things on which you're overspending.  Gifts, weddings and cars are certainly included.

This is a Travesty - A Chocolate Price Spike

The main ingredient in chocolate, cocoa butter, is up 70% in the last year.  Your Hershey bar may get smaller and your higher-end, dark chocolate will likely increase in cost.

If The Queen Can Cut Back, So Can You

Looks like The Queen's private train may be too costly to repair.  Are we watching The Queen live below her means or be money conscious?

Are Politicians Profiting Off Of the Market Volatility They’re Creating

When I got home from grocery shopping, I checked to see how the stock market closed.  It closed up today.  The consensus is that the market closed up due to speculation that a debt-deal was eminent.  Lately every day is different.  One day it’s down due to a lack of an agreement.  The next it’s up due to the speculation of an agreement.  This made me wonder if our politicians are investing long and short contingent on the sentiment they share with the media. 

60 Minutes did a story in 2011 on high-level government officials profiting from insider trading, making government deals and investing accordingly before the information was public.  This got Washington up in arms and they finally decided to pass the “Stop Trading on Congressional Knowledge” Act or the “STOCK” Act.  You know someone gets paid a lot of money to come up with acronyms in Washington?  That’s an “essential” job, of course. 

Congress passed the bill and everyone patted themselves on the back.  That was, until, they realized enforcing it was going to be hard.  So, on the DL (down-low), Congress, both Democrats and Republicans, quickly passed an amendment on April 12 and 13, 2012, gutting key provisions of the act and President Obama signed it into law the following week. 

Essentially the amendment to the STOCK Act removed requirements to create a searchable database listing disclosures of high-level officials and file their disclosures electronically.  This makes oversight virtually impossible.  Yes, insider trading is still illegal, but without critical oversight, who knows who’s profiting off the rollercoaster we’ve been riding.  Insider trading was illegal prior to 2011 and clearly the oversight and adherence to the law was questionable.   

This makes us wonder if politicians are profiting off of the market volatility they’re creating with the government shutdown and debt deal negotiations.     

Considerations When Applying for a Store Credit Card

In general, the rewards for signing up for retail store credit cards aren't worth it.  If you're considering one, ask yourself these questions.

Great American Beer Festival Winners

We're fortunate to live in Denver, home of the annual Great American Beer Festival.  We didn't go this year.  We do have a list of winners and will try them throughout the year.  If we're staying home to save money, we'll spend just a little more on quality beer or wine.  Being Money Conscious doesn't mean having a bad life.

Money Mistakes to Avoid in Your 20s

Unfortunately, some people are still making these mistakes in the 40s and 50s. 

Cut Your Cable Cord and Still See NFL Football

Apparently this technology has been around for a while, but we're not the savviest techies.  We're not sure how legal this is.  Watch free NFL Football at your own risk. 

More - Cutting the Cable Cord

If You Feel Like You're Working Harder For Less . . .

it's cause you are.

More Wine for All We Say

Millennials are changing the wine industry.  Money quote: "In the same way [millennials] don’t trust the banks, insurance companies or the government, they don’t care what critics say about a wine or how many medals a bottle has won.”  They are more about the experience of finding and drinking the wine, how they found it and how it tastes, not how much it costs or how many medals it earned.

Jobless Claims Increase

Jobless claims are up 66,000 to 374,000 through October 5th.  Looking at the market, you wouldn't know this was a bad thing.  Wall Street is more concerned about  E Capitol St. NE.