Welcome to a new guest contributor, the Broke Bytch. She is a new college grad with a minimum wage job. Enjoy her irreverent tips for saving and spending. Caveat; Her ideas are her own and I bear no responsibility for their content!

Broke Bytch Background

Like most people in their early twenties, I’m strapped for cash.  Sometimes I feel like my monetary impairment keeps me from going out and living life to its fullest.  What can you do for fun these days for free?  I’ve done my research and most articles professing solutions to a lack of funding suggest things like: reading a book, taking a walk, going on a hike, stargazing, window shopping, renting a movie from the library, sunbathing; I think you get the idea.  Well if you’re like me, you can only go on so many walks and hikes or read so many–ha! I had to stop, its too absurd, I’m out of college, please, like I read.

So I  made a list of my greatest spending categories and came up with cheaper alternatives, so I wouldn’t feel so burdened by my my financial state.

My greatest spending categories list looked something like this:

1. Housing
2. Food
3. Entertainment
4. Transportation
5. Cell phone
6. Clothes

True Confession About My Housing Arrangements and Other Cheap Living Options

First, before I begin showering you you with my unbridled wisdom, I must confess I partake in one of the biggest money-saving techniques out there:  I live with my parents.  However, if you are unable to afford this luxury, there are other solutions.

A potential option, other than cramming into a hole in the wall with twenty other roommates is to look for an in-house caregiver or nanny position. Aupair-World is a cool site to check out.

Ever considered farming? If you are flexible in where you live you could work on an organic farm or WOOF. This organization profiles farms world wide, so it’s a great option for those broke souls with wanderlust.  Other benefits of farming are, you won’t need a gym membership or sleeping aids because you’ll be working so hard doing back breaking labor.

Skip the apartment altogether and travel instead. In terms of traveling on the cheap STA travel  and couch-surfing are awesome options. In fact couch surfing is promoted by NPR, the Frugal Traveler, the New York Times, the Guardian, and Time Magazine, so it must be okay.

If you can’t live with your folks “rent free” you could even rent a room in someone’s home. All those people who got slammed by the mortgage meltdown are now renting out rooms to help with the mortgage payments. And if the family is really helpful, maybe they will even do your laundry (although don’t count on it).

What to Expect From the Broke Bytch

…Wait, wait, one more thing: as you can already gather from my previous paragraphs, I’m not exactly a short-winded person, so in order to make my mind-numbing awesomeness easier to digest for all of you weak-minded individuals, I’ve broken down my entries into manageable chunks.  Therefore my subsequent entries will be grouped as follows:

1. Food: How to not eat through your wallet, no matter how high the fiber content
2. Entertainment and Transportation: Time to wake up from your drunken stupor and get home (oh wait, that’s me..)
3. Phone and Clothes: Brrrring, brrrring, Its the 90’s calling, time to get some new duds, dude (because that is apparently how the 90’s talk)

I would like to promise a particular schedule, but I’m too busy trying to make a buck to commit. Why not pick up the RSS feed and then you’ll be sure to catch every column.

See you next time,

Broke Bytch

How do you slash living costs?

Secrets from the Millionaire Teacher, Andrew Hallam

“Review or door stopper,” read the subject line of the email.

Now that is a book review request I enjoy. Make me laugh, and you have my attention.

But this is not going to be a book review. This article will give you actionable tips from inside the book. Suffice it to say, Millionaire Teacher is a comprehensive personal finance book for beginning or intermediate investors. And I recommend that you read it!

Take Action

Read this article and come away with actions to implement to become a Millionaire. Some of these may not be completely new and that is because there are tried and true strategies to grow your resources.

First come the Quick Tips; next is the in depth information and motivation.

Nine Rules of Wealth Checklist

1. Spend like a Millionaire, if you want to become rich. That means don’t spend too much. In general, millionaires live conservatively, not extravagantly.

2. Start investing early to allow your funds to compound and grow over time.

3. Invest in low-cost index funds to maximize your future wealth.

4. Learn about stock market history, greed, and fear, so you don’t become a victim of buy high and sell low.

5. Learn to build a complete stock and bond portfolio using index funds. You will beat most professional investors.

6. Use index accounts, no matter where you live.

7. Don’t fall for an advisors ”hard sell”.

8. Watch out for “too good to be true” scams that promise outsized results.

9. If you want to dabble in individual stocks, do so only with a small portion of your portfolio.

In Depth Advice for Wealth Building

More detail pilfered from Hallam, a high school English teacher who built a million dollar investment portfolio on a teachers salary.

Spend Like you Want to Grow Rich

You’ve heard it before, the millionaires are not the folks riding around in Cadillacs and Porches but are those living in the modest home driving an older car. Hallam’s path to millionaire status was peppered with a cheapskate lifestyle for many years. This guy rode his bike 70 miles per day to work through rain and sleet. He lived on clams salvaged from the beach accompanied with low cost pasta and potatoes. Free rent was the byproduct of house sitting gigs for those Canadians wintering in the south.

That’s how he can afford to live well today; travel, live in a condo with a pool and squash courts, and drive a classic Mercedes.

What’s the takeaway for you? I certainly don’t want to get my food from the beach or ride a bike to work. Yet there are other ways to live conservatively with an eye towards the future. Substitute low cost alternatives for life’s necessities. You need a place to stay, you don’t need a luxury apartment. Take in a roommate or two. You need food, but you can cook at home instead of eating out. Have a peanut butter sandwich (I have one at least three days a week) for lunch once in awhile and pasta for dinner.

The lesson is this, delay gratification for a while and understand that the wealthy “Look to the Future.” Spend responsibly, think creatively, save profusely, and you can become wealthy on a teacher’s salary.

Conquer the Enemy in the Mirror; Watch out for Fear and Greed

I tend to worry a lot, so anything to do with “mental money” strategies catches my interest. Hallam explained that mutual funds tout 10% average annual gain. Great, that means that all the investors in the fund earned 10% annually as well? Not quite.

Investors tend to be influenced by the bifurcated emotions of fear and greed. When the price of a mutual fund falls, many investors get scared and pull their funds out. Then after the fund goes up for awhile they get back in.

What just happened is that those investors missed the largest portion of the funds’ gains. Hallam underscores the importance of the classic statement;

It’s not timing the market, but time in the market, that leads to long term financial growth.

The stock market goes up and down. In the short term, these movements are completely random. In the long term the trend is upward. Jumping in and out of the market leads to buying high and selling low. Not a great way to make money!

Hallam disclosed that he put money into the stock market after 9/11, when the fearful were pulling out. He reasoned that businesses weren’t worth less because there had been a terrorist attack. And of course, taking advantage of bargains when fear is in the air is a wonderful method of buying low.

Fight the tendency to follow the crowd and your profits will grow.

In sum, for those just starting out, there are engrossing stories and time tested wealth building strategies showcased in Millionaire Teacher. There’s even a section on how to make money buying and selling your vehicle. It’s a fascinating approach that anyone can try.

Remember, live sensibly, spend smart, and invest regularly. You may not get rich overnight, but you will set yourself on a path to a wealthy future.

Can’t Get Enough Wealth Building?

• 10 Rules for Building Wealth; CNN Money and Fortune
• How Young Adults Can Build Wealth; Young Adult Finances
• Side Businesses You Can Start Today; Wise Bread by Ashley Jacobs
• 12 Tips to Build Wealth for Early Retirement; Financial Mentor

Tried any of these strategies? What additional wealth building advice can you offer?

I’ve been a mom for 2 decades and a daughter for quite a bit longer. I’m also a bit of a control freak when it comes to consumption. I don’t want anyone telling me what to buy and when. That said, I’m not a total malcontent. I’m lucky to have a wonderful spouse. El Carino doesn’t share my viewpoint and insists on taking me shopping for Mother’s day. (And of course I appreciate it!)  So, last week end we hit the outlet mall for a sale outfit from Banana Republic! At 40% off it was quite a bargain.

Cheap Mother’s Day Gifts Any Mom Would Love

Jr. Carina is not as financially set as her dad, and this article is informed by her wonderful gifts to me over the years.

Gifts Under $20.00

Magazine Subscription; I love decor and anything “home” related. There are many magazine subscriptions to be had for under $20.00. Some mom friendly recommendations include; House and Garden, Redbook, More, Good Housekeeping, Oprah, Real Simple, Self and many more. Although that list is rather gender stereotyped, consider your mom’s interests and hobbies and choose one that is a fit for her. Obviously, if your mom is interested in personal finance like I am there are scads of magazines. One of my low cost favorites is Fast Company.

Books; Sometimes mom wants a particular book but hesitates to buy it for herself. Downloads for Kindle and eReaders are a real bargain and you could surprise your mom with one she would enjoy. Used bookstores are great spots for bundles of bargains. I recently picked up a coffee table book chronicling the American Home for $1.00. Two recent favorite reads are The Girl with the Dragon Tatoo by Stieg Larsson and Risk Less and Prosper by Zvi Bodie and Rachelle Taqqu. Game books like Sudoku and Crosswords are great for keeping mom’s mind sharp. One of my all time favorite gifts was a Doonesbury cartoon book.

Pampering Treats; It doesn’t cost much to indulge mom. Buy a designer lipstick for under $15.00. Lotions and bubble baths are so sensuous. What about a premium nail polish? Buy a small perfume sample, on sale during this season. Consider the treats that mom covets.

Music; Who doesn’t like music? Downloads, full price, and discount CDs abound. Introduce mom to a new artist you think she might enjoy. Download it onto her phone or MP3 player. If your mom is a bit old school like I am, you can grab a CD from the bargain bin or a music resale shop. Songs from your mom’s teens and younger years can bring back those memories of carefree days.

Free

I adore home made gifts. Anything my daughter has made me over the years is still a treasure. In fact, a beautiful plaster of paris shell paper weight has a place of honor on my bedroom shelf. There’s nothing like those adorable kids paintings in a frame to spruce up a bare wall. And the framed photos with artistic editing  are sitting in my office.

Arts and Crafts; The list is only hindered by your imagination. Mom will appreciate a painting, drawing, sculpture, or collage for the day. Paste some photos of you and mom on a box (use one that’s laying around the house), cover with a few coats of mod podge, and you have a lovely keepsake box. For inspiration check out pinterest.

Beauty Services; Give mom a home manicure or pedicure. The time you spend together is priceless and creates a memory. Or treat mom to a massage.

Time; Mom’s cherish time with their kids, especially as they get older. Give mom an afternoon of mom and kid time. Do something free like visit a park, go for a walk, visit a gallery, window shop, or go antiquing. Jr. Carina and I recently visited a local museum and made clay sculptures together. It was so fun, and her two clay animals are a constant reminder of the afternoon together. Gear the time towards mom’s interests and passions. Select a special and memorable activity.

Food; Of course there is the time tested breakfast in bed. What mom wouldn’t like that? How about trying a special family lunch or dinner with a unique menu? Barbecues are perfect this time of year. For brunch there are amazing pancake and french toast recipes. My mouth is watering right now!

Spend some time thinking about what mom likes. If she’s like most moms, she puts others first and would really appreciate a nice hand written card and a “from the heart” gift.

HAPPY MOTHER’S DAY

For More Cheap Mother’s Day Gifts;

• Country Living
• Savvysugar
• Free Money Wisdom
• Financial Highway

What are your favorite low cost Mother’s Day Ideas?

image credit; google images_ingles360_blogspot

PRINT THIS ARTICLE OUT AND SAVE FOR REFERENCE

I started investing in my 20′s when I came into a small inheritance from a great aunt. My fear of the stock market and recollection of stories of the great stock market crash of 1929 led me to consider investing in bonds as a safer way to grow my money. Flash forward several decades, as I prepare the lectures for my university Investments class, I am struck by how easy it is to decide whether to invest in taxable or tax free (tax-exempt) bonds. Learn this quick and easy formula and you will never wonder again whether it is better to snatch up those state or city municipal bonds that are offered by your locale or stick with corporate bonds paying a higher yield.

What is a Bond?

First, a quick tutorial for those just getting started. A bond is a loan to a company, city, state, or federal government. In exchange for the loan, the borrower pays the lender a coupon or interest payment. When you purchase a corporate bond, you loan money to a company and pay tax on the interest income received. Corporate bond  taxable.

What are Tax Free Bonds?

A bond in which the income produced is free from federal, state and local taxes. Most tax-exempt securities come in the form of municipal bonds, which represent obligations of a state, territory or municipality. Investopedia

Purchase a bond issued by your state to improve the roads and the interest you receive is exempt from federal and state taxes. Sounds like a great deal doesn’t it? Since the bonds are tax- exempt, they usually sport lower coupon (interest) payments.

So how do you determine whether you are better off buying a 5 year municipal bond issued by your state and paying 2.5% or buying a 5 year corporate bond paying 3.5%?

Tax-free or Taxable Bonds?

There is an easy way to determine which bond offers a higher after tax return. Calculate the Tax Equivalent Yield of the tax exempt bond and compare it with the yield of the taxable bond. Then choose the one that offers the greatest after tax return.

Try it out

Let’s assume that your state and federal combined tax rate = 30%

You can purchase a 5 year taxable corporate bond with a yield = 3.5%

Or, you can purchase a 5 year tax-exempt municipal bond from your own state with a yield of 2.5%

Which is the better deal?

This simple formula will tell you in under a minute.

Tax Equivalent Yield

Compare which is higher:  municipal bond return/(1-combined tax bracket) = taxable return (or tax equivalent yield) 

Taxable return = 2.5%/(1-30%)=tax equivalent yield of 3.57%

A taxable bond must pay at least 3.57% in order to beat the 2.5% tax exempt return on the municipal bond.

Since the best return on a comparable taxable bond is 3.5%, the investor in the 30% tax bracket is better off purchasing a tax free bond paying 2.5% interest, as this yield is equivalent to a taxable yield of 3.57%.

With the Bush tax cuts expiring at the end of this year, it may be time to check out investing in tax free bonds.

Can’t Get Enough Tax Free Bond Info?

What are Muni Bonds and Should I Own Any? @ Oblivious Investor

7 Pillars of Investing in Tax-Free Bonds @ Kiplingers

Put on for my City; Tax-Free Bonds @ Young Adult Finances

Investing in Municipal Bonds @ About.com

Bond Investing-What are Tax Free Bonds? @YouTube-eHow Finance

Have you considered investing in tax free bonds? 

image credit; google images_scminvestment

Interview with best selling author, Dr. Charles Richards, author of The Psychology of Wealth – Part 2

“For every problem, there has to be a solution.” Dr. Charles Richards

What specific strategies can one employ to stop the green monster of envy and jealousy?

Accept the idea that that there’s more than enough for everyone. You don’t have to feel that if I don’t get mine, there’s not going to be enough for me. By understanding the divergent archetypes of wealth you can conquer your inner envy.

The Archetypes of Wealth

There is both a positive and negative archetype of wealth.

The negative archetype is fear based and focuses on lack and insecurity. This viewpoint is highly competitive and constrictive. You always try to hold on to what you have. You believe that there is only so much to go around.

The positive expression of wealth is more creative, not competitive. You focus on creating what gives your life more value and more of what you want. This viewpoint employs the belief that there is more than enough to go around.

There’s not enough time to worry about beating the other guy or gal. Holding an expansive, empowering, generous, and helpful viewpoint can obviate the green monster of envy and jealousy.

This goes back to my former advice to have an ideal or goal that transcends self interest.

 What are the best 3 pieces of advice for someone who wants to be wealthy?

 Tip 1 to Become Wealthy

First, consider what you plan to do with your wealth. What is the value of the money, and how will it serve you and others?

Then, identify what you are good at and enjoy doing. Where do you excel?

Tap into your special strengths and immerse yourself in activities that are congruent with your strengths and passions. Join organizations and activities that will further your interests and contacts.

 Tip 2 to Become Wealthy

After identifying your personal areas of excellence, make a plan and write it down. It’s not enough to think about it in your mind. You must write out the steps you need to take and what you need to do to make it happen.

Review and revise your plan regularly.

Do this even if you’re not sure of how it will exactly play out.

 Tip 3 to Become Wealthy

Have the idea that ultimately you are going to be successful, if you persevere. Embrace the reality that failure is just a stepping stone to success, as long as you persevere.

For example, Steve jobs was kicked out of his company and persevered. He created Pixar, rejoined Apple, and propelled the company to amazing success, after being removed from his own company.

By making a plan, writing it down, and further revising and reviewing the plan every day, you are training yourself for success.

Wealth is doing what you love. Maintain the mindset that you will be successful. Persevere through adversity. Wealthy and successful individuals hold these attitudes.

What mental money strategies will help?

Maintain an optimistic, positive, and hopeful perspective. Know that you will find a way to make your life work and that you will find a way to bring into your life the wealth that you need.

Do not lose hope; you need to accept the challenge and find the solution. Dr. Richards reminds you that there are solutions for every problem.

Barb Recommends; Personal Finance Reading

• Money Crashers continues on the topic by explaining How to Feel Wealthy.
• Thad’s Thoughts on Decluttering-Thad has a gift for saying a lot in a few words. Check out his site.
• Wealth Informatics had me laughing out loud with her fall into internet oblivion article; Want to be More Productive? Create a Not to do List
• Hope to Prosper asks “Is Gasoline Busting Your Budget?” My response is, YES.
• Krantcents asks, Do You Want to Earn More?
• On Target Coach is echoing a concern of mine and asks you to Prepare for High Inflation.
• Miranda Marquite, at Bargaineering writes about 10 Side Businesses You Can Start from a Hobby.
• Wise Bread inspires with 9 DIY Projects from the Dollar Store.
• KNS Financial explains How to Start a Blog.

Barb Across the Blogosphere

• Findthebest Blog, Expert Blogger article-Do You Need an Investment Advisor?
• Findthebest Blog, Expert Blogger article- Factors to Consider When Choosing a Bank
• Busy Executive Blog published How to Handle a Tax Audit
• Carnival of Personal Finance at My Personal Finance Journey-Selected for Editors Pick
• Carnival of Financial Camraderie at 101 Centavos featured  58 Habits to Increase Wealth
• Carnival of Wealth at Control Your Cash featured 58 Habits to Increase Wealth
• Festival of Frugality at This That and the MBA

 How do you cope with the green monster of envy?

Don’t miss the book review (The Psychology of Wealth) and author interview-Part 1. 

image credit; google images_ chicagosean.com

Check out The Psychology of Wealth book review

Enter to WIN a free copy of the Psychology of Wealth, by signing up for my Wealth Tips Newsletter.

“I wrote The Psychology of Wealth to discover what it takes to create true abundance. The people whose stories I’ve included have a great deal to tell us about how we can prosper and achieve wealth in the fullest sense of the word. Their answers provide a roadmap for success and tremendous optimism about our prospects.”

— Dr. Charles Richards

After reading Dr. Richards outstanding Psychology of Wealth, I had to get more information about the man who penned this thought provoking book. He generously agreed to be interviewed, and what started with eight brief questions turned into one of the best one and a half hours I’vespent in quite a

TAJ MAHAL

while.

Richards looks at life through a unique lens inspired by his Tai Chi practice and early study of Philosophy. But don’t think this is a “touchy feely” type of guy. He is all action, motivation, optimism, and inspiration.

Life lessons learned from a conversation with Dr. Richards

What motivated you to write the book?

As a practicing psychotherapist, I deal with relationship issues all the time. Individuals’ relationship with money repeatedly surfaced in the course of treatment and I realized there was a need for help with the psychological issues of money. The economic downturn made things worse, with high unemployment, people losing their homes, and the difficulty of finding a job. As a devotee of personal growth, I realized that what we put our attention on will be a reality in our world. I knew I had a message that needed to be heard.

How did you schedule in the time to research and write the book? Were you also working full time?

I was very fortunate to have a circle of friends and business associates who wanted to help me with this project. After offering the concept to McGraw Hill in late 2010, they offered me a contract and advance to have a publication ready manuscript by August, 2011. With less than 6 months to write the book, I hired a researcher and editor. I cleared my schedule and wrote non-stop, completing the draft in a bit over 4 months.

How can a motivated young person succeed personally and financially without positive role models in his/her family?

My parents divorced at age 8 and my grandparents didn’t talk much about money. At age 15 I started reading philosophy and metaphysics in search of answers. I had questions about life and realized I had to find my own answers and perspective.

Find Role Models

For those looking for direction to build life and wealth skills, go outside of your family of origin to get role models that engage and excite you. Find mentors that are achieving what you are aspiring to.

Start by reading biographies about people you admire and respect. Read about successful individuals and you have a window into their minds.

Establish friendships and affiliations with people who are doing things that you value and aspire to. Look around you for mentors.

If you are a student on campus, join groups and organizations. When you find one that you resonate and identify with, get involved. If you’re not in school, check online for community organizations in which to participate. The more you go out in the community, the more you can make contacts and learn from others.

 Set a Goal that is not Self Serving; Look Outside Yourself

If you just think about yourself, you are always going to be limited. If you are serving a higher ideal, whether it be environmental, political, educational, or religious a greater flow will propel you. Look beyond yourself and to experience a greater flow of money, energy, and succes

How are wealth building strategies different for people of color than for those of the majority culture?

I don’t identify with the limitations associated with being a person of color. For example, I don’t embrace the negativity of the economic downturn. It’s not that I deny that there is a problem, I just don’t let it define me. I take it as a challenge to live beyond the limiting factors of race.

Although it is a reality that there is discrimination, it doesn’t have to be my truth, if I don’t identify with it. And I don’t expect people to act racist towards me.

DWB-Driving While Black

It’s no secret that African Americans get stopped by the police for no reason, on occasion. It’s happened to me. When stopped, most folks assume there is nothing they can do and will just get a ticket.

Although I’ve been stopped, for no apparent reason, I was always let off with a warning. I just never identified with the limitations of being a person of color. I hold the belief that “you are what you believe and what you assume to be true.” I just didn’t own the limitations associated with being a person of color.

Actually, Charles identifies with the advantages of being a person of color, and he does not expect harsh treatment or a raw deal. So in fact, he is not constrained by his race.

I don’t expect the worse, but take a positive viewpoint.

My advice to people of color is this; take the advantages and don’t get caught up in the disadvantages.

Stop back next time for Part 2- Secrets of Wealth

Enter to WIN a free copy of the Psychology of Wealth, by signing up for my Wealth Tips Newsletter. Let me know that you signed up for the newsletter in the comments section please.

What are your wealth building secrets?

image credit; Howard Hillman

Put The Psychology of Wealth on Your Reading List Immediately

& ENTER TO WIN A COPY OF THE PSYCHOLOGY OF WEALTH HERE. Contest ends May 15.

“Action is a great restorer and builder of confidence. Inaction is not only the result, but the cause, of fear. Perhaps the action you take will be successful; perhaps different action or adjustments will have to follow. But any action is better than no action at all.” by Norman Vincent Peale as quoted in the Psychology of Wealth

At the risk of sounding self aggrandizing, when I was contacted by the marketing department at McGraw Hill Publishing to review this book, I assumed it would be a boring rehash of everything I already knew. Having read a multitude of finance, personal finance, and psychology texts, I thought I knew pretty much everything on the subject.

Charles Richards, PhD, author of The Psychology of Wealth

I WAS WRONG

Quick Recap of The Psychology of Wealth

Based on research, anecdotes, and and personal experience, Dr. Richards accomplished a very difficult task. He took the breadth of wealth, psychology, mindfulness,  and money management fields and integrated them into an inspiring and informative book. Richards starts out with a definition of wealth, and it’s integration with self esteem.

Wealth has less to do with money and more to do with personal responsibility, risk taking, achievement, and determination.

Don’t let me suggest that this book has a pollyannaish approach. On the contrary, the role of debt and wealth is front and center, yet there is so much more.

The central concept of The Psychology of Wealth is that wealth and poverty are both states of mind. This singular statement reifies both the simplicity and complexity coexisting in this book.

How Your Life Will Improve from Reading The Psychology of Wealth

If you really consume this book and take the messages to heart, here are some outcomes you can expect;

An awareness of how your family operating system programs your beliefs, attitudes, skills, anxieties and expectations and contributes to your life satisfaction.

How to get beyond the awareness of your background, and use it to overcome any negative messages about wealth, success, and prosperity. Get inspired by real life stories of people from difficult backgrounds who transcended lack of financial wealth and prospered.

For example, Leticia manifested a sense of abundance which led to great personal success, in spite of an impoverished upbringing. Her family had little money, yet her father ingrained a sense of value by focusing not on Leticia’s appearance but upon her accomplishments and intelligence. He helped her to understand that the tiny size of their family home did not define her.

Learn the true meaning of money. Currency, another word for money, represents transferring cash for services or work. In and of itself, money is without value. So many folks focus on the magic “number” to signify their financial status. It is a fact that money is only a means of barter to help you buy goods and services.

According to Dr. Richards, “Price is what you pay. Value is what you get.”

Giving back is another familiar concept in the wealth literature, but Richards take on this subject can be summarized by one quote,

“The psychology of wealth requires trusting that, no matter what happens, we will have enough.”

The story of Donald Trump stopping his limousine on the way to a speaking engagement to give advice and encouragement to a bevy of young people clamoring for his attention is a perfect example of the types of stories Richard’s interweaves to enliven his prose.

Chapter 7, “Living Consciously” discusses the popular living in the moment concept. Have you considered this concept in relation to debt? The book links conscious living to conscious debt and offers a rich rubric for the debt decision-making process. Carry the living consciously concept into every corner of your life and you will master the psychology of wealth.

The book is so rich with anecdotes, advice, and action steps, I want to savor every page. It’s not often that a money book is so satisfying.

It’s difficult to find a criticism with the book, but in order to be evenhanded, following is my one complaint; the seamless integration of money and life fulfillment concepts makes me sorry that I didn’t write the book myself .

Enter to WIN a free copy of the Psychology of Wealth, by signing up for my Wealth Tips Newsletter. Let me know that you signed up for the newsletter in the comments section please.

You’ll even get a free bonus eBook of my award winning 20 Minute Guide to Investing, just for signing up. The winner will be chosen on May 15 and will be selected at random.

Don’t believe my review? Read what other personal finance bloggers are saying about The Psychology of Wealth

• Financial Samurai
• Retireby40
• Enemy of Debt
• Balance Junkie
• CNBC review by Dr. Richards

Stop by next time and read The Secrets of Wealth an inspiring 2 part interview with the author, Dr. Charles Richards.

How does your mind impact your feelings of wealth or lack thereof?

“I always leave with less than I had before” The Wrestler, Bruce Springsteen

Educate, Inspire, Motivate for Wealth in Money and Life

EDUCATE

For all you rock fans out there, you know who the boss is …..Bruuuuuuuce. I recently saw his memorable Wrecking Ball concert tour performance. While I’ve been an avid listener, I’ve never seen him in  concert; what a mistake.

The boss fulfilled his self appointed roll as “the minster of rock and roll.” He reminded me that the essence of rock and roll is passion and freedom. Clearly, Bruce’s music and performances are political. He highlights social issues from racism in “American Skin”, to the current economic inequities in “Jack of All Trades”, to a call for compassion for others in “We Take Care of Our Own.”

I want to make sure that I emphasize the ethics and virtues of social justice in this blog.

Wealth is granted through service to others. Notice how wealthy you feel after giving of yourself.

INSPIRE

I resonated to the message in the music because it is so similar to what I try to communicate in this blog Educate……Inspire…….Motivate.  Through his performance, Bruce inspired me. While I’m a veteran of many concerts and live performances, I was struck by the profound generosity of his performance. He really cared that I was there. He involved me. Second, I was inspired by his presence, as he shared a bit of his story; I knew he was talking to me. Not only did I have a great time, but it was clear that he and his band mates, The E Street Band, were profoundly having fun.

So I aspire, due to his inspiration to be more giving and more present in my advice to you. I am recommitted to giving you the best wealth building tools possible.

MOTIVATE

Springsteen’s well documented working class background resonates with me. We share the sense that persistence, self discipline, and hard work are inherently satisfying. His work ethic was clearly demonstrated by playing for over 3 hours nonstop, despite near exhaustion at the end. He committed to giving the concert goer more than she paid for. His passion for serving the audience was sensed by all.  Like my father, he embraces the virtue of hard work done exceptionally well. I am re-motivated to improve my own work practices and meet the needs of those I serve.

 Where do you get your inspiration?

Barb Across the Blogosphere

• Wise Bread featured 58 Habits to Increase Wealth
• Hope to Prosper included my article on Why I usually do my Own Taxes
• Read my latest Benzinga, Brain Trust post; Trend Watch: Traditional Retail is Dying
• Carnival of Financial Planning at Thriftability promoted You don’t need an IRA; There’s always Social Security
• Krantcents Included my 58 Wealth Tips in his Friday Night Likes

image credit; google images blogs.ajc.com

Google Can Help You Out; For Free

When my world is organized and in control, I am happy. When things are in chaos, not so much. I just got caught in one of my periodic urges to create organization in my world. Read about my light bulb moment to create order out of chaos.

In reality, a sense of wealth has very little to do with money and everything to do with intangibles. No matter your stage in life, wealth is obtainable. For me, organization creates feelings of contentment and control. Actually, research has shown that feelings of control lead to greater life satisfaction.

I’m trying to create “systems” that simplify my life and keep me from going off on hours long trips into the mania of focus on the unimportant.

Have you ever found yourself sitting down for  a quick email check only to look up 2 hours later and wonder where the time has gone? That’s exactly what I am trying to avoid!

FREE AND EASY ORGANIZATION TIP

I’ve heard folks talk about evernote. I probably even have an account there. I also tried other online organization systems. At home, I have so many notebooks and scraps of paper floating around, I could wallpaper a room. Then of course there are the numerous folders, binders, stand up files, and stackable files. You would think that with all these cool tools, I would have the organization thing totally under control. Not really.

This morning I had a brainstorm.

What about GOOGLE DOCS?

Before you run away screaming, “I already have Google docs.” Check out the depth of functionality of this application.

According to the Google Docs page here are a few benefits ;

“Faster, real-time collaboration
Edit documents with others and see changes as they type.

Import from the desktop
Easily move documents between desktop applications and Google Docs.

Online word processing
Margins, indentations, tables, footnotes, comments and much more.”

This morning as I was trying to clean up the house, as usual I came upon a bunch of notes written on scraps of paper. The topics varied from blog building ideas, blog article ideas, names and phone numbers, and tips on how to refinish furniture. That’s when the light bulb went off! Create documents for each of the general types of information. I already had a “contacts” spreadsheet going in google docs, so I just input the names and phone numbers there. Next I started a doc for home repair and decorating projects for the furniture refinishing idea. The blog stuff was added to existing “blog building” and “blog post” ideas docs.

No, Google is not paying me for this article. In fact, I’m not even sure if Google likes me or not.

In addition to the documents feature, they offer spreadsheets, presentations, drawings and forms.

USE GOOGLE SPREADSHEETS FOR EASY ACCESS TO FINANCIAL RECORDS

I use the spreadsheets a lot. They are a bit tricky at first, especially if you are accustomed to Excel, but after awhile, they become easier to navigate. What I really like is collaborating with others and access from anywhere. I work everywhere these days; library, coffee shop, laptop on the patio, and even desktop (yea, I’m one of those dinosaurs).

Since I maintain my personal and corporate financial records on a secure desktop in my home office, it’s nice to upload non-sensitive financial spreadsheets to Google docs. For example, all of our personal investments as well as our family asset allocation are on Google spreadsheets. That way, if I want to complete a quick Morningstar analysis on a stock or fund, or view our asset allocation, I can do it from anywhere. I keep notes on my latest fund and stock research as well.

But I didn’t stop there. My list of google docs was getting long and unwieldy.  That’s when I figured they must have a way to categorize, kind of like a file cabinet for all of my varied information.

HOW TO SET UP A GOOGLE COLLECTION

Setting up a collection is Google-speak for organizing your information into files. Instead of writing my take on this organizing topic, I stole Google’s explanation verbatim;

 ”Create a collection

 Collections are a combination of the best features of labels and folders. A file can have multiple collections, much like the labels in Gmail. Collections can also be stored hierarchically, like folders on your desktop. In addition, collections can be shared.

Over the past several years, I’ve gradually moved my family portfolio and my corporate portfolio away from individual stocks and into Index Mutual Funds and Exchange Traded Funds (ETF’s). Although both portfolios have sported excellent recent double digit returns, not every holding was a winner. In the case of two stocks, I did not fare well.

First a bit of background, I have been investing for decades with excellent outcomes. Many years both the portfolios I manage have outperformed the S & P Index handily. I am not a frequent trader or market timer, but stick to a well thought out asset allocation in line with the goals of my family for our personal portfolio and the goals of the corporation for the professional portfolio.

As anyone in the investing field understands, no matter how many winners one holds in a portfolio, there are bound to be a few losers.

Over the years, I tired of the hours of research required to invest in individual stocks. On top of that, finance research convincingly supports the out-performance of index fund investing over that of stock picking. In fact, in a typical year, a majority of actively managed mutual funds do not beat the returns of their index fund benchmarks. And those managed funds that outperform one year, rarely repeat that performance year after year.

The takeaway is simple; it is quite difficult to beat the overall market consistently.

In spite of my resolve to transition to mutual funds and exchange traded funds (ETFs), I did not immediately sell all of our individual stocks.  I decided to get rid of them gradually, after analysis and determination that their growth prospects were fading.

In the case of Nokia (NOK) and Best Buy (BBY), I waited a bit too long to sell.

Best Buy and Nokia = Terrible Performance

Best Buy has been a remarkable growth story over the years with nationwide store expansion and offerings of any electronic one could want, either in the store or online. With the closure of Circuit City, I thought Best Buy would go through the roof and pick up all of their growth. Several years ago, when I purchased Best Buy, it’s future looked promising and its growth initiatives and store expansion foretold an expansive future for the company.

Nokia a former technology darling seemed like a sure fire holding. With a market share topping 40% in 2008, how could the company falter? Here’s how, with the advent of the smart phone, Apple and the android, Nokia’s market share fell to its current 29%, with no rebound in sight. At present, the fortunes of this company are going in the wrong direction and suffered a $1.2 billion loss its most recent quarter.

Take a look at the five year performance of Best Buy and Nokia;

As the Yahoo Finance chart so graphically illustrates, both stocks have plummeted during the past five years.

When investing in individual stocks there are some key factors to consider;

• Accept that individual stock prices are random in the short run. Some will rise, others fall, and some prices won’t move much in either direction.
• Before purchasing an individual stock it is crucial that you study its growth prospects, competitive landscape, valuation, and financial statements.
• This type of analysis should be ongoing during the time you hold the stock.
• Before purchasing a stock, it’s important to write down the reasons to buy the holding and what would cause you to sell.

Investing Caution

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