Saturday, December 29, 2012

My Book Review: "The Legend of the Monk and the Merchant" by Terry Felber

I seriously feel like I say this every few months, but this honestly is one of the best books I have read this year. This is one of those books that makes my certified list of, “you need to read this before you die.” Charlie Tremendous Jones said that 20 years from today, you will be the same person you are today except for the books you read and the people you meet. This is one of those few books that needs to be on your list, right along with Dave Ramsey’s “The Total Money Makeover.” J

Terry Felber’s story and 12 keys to successful living were motivating and inspiring. Felber put into words what I have always felt in my heart but couldn’t put into diction with eloquence. My favorite aspect of this tale is the relationship between clergy and those of us in business. Felber perfectly relays that both sides have power and influence to further God’s kingdom on this Earth.

Yes this story has a religious context but I really feel that the central message is relatable regardless of your religious (or non) affiliation.  As someone whom is pursuing wealth building, it was happily refreshing to have one of the central characters defend business and making profits. Someone other than Dave Ramsey believes that making money is not evil and that with the right heart and approach, success in the business realm can even help make our world better. The interconnected relationship between the business and clerical worlds was perfectly laid out in this book. I absolutely give this book my stamp of approval and it will be one I re-ready several hundred times in the years to come. Its message is remarkable and reinforces my spirituality as I march on from 0 to one million.

Wednesday, December 26, 2012

My Christmas Shopping Experience

This past week before Christmas I did something that I have not done since I was in college working retail: I closed down the mall. With $1,000 budget money in hand, we decided ahead of time to take advantage of Christmas sales going on to stock up on clothing items. Personally one of our goals in 2013 is to get out and do a bit more traveling. So at this point our travels will take us to a friends’ wedding in Arkansas, out to California a few times to visit my family, a high school reunion, possibly Europe or the Asia-Pacific as well as Nashville and Charleston. So in anticipation of these events my wife and I decided that it was time I stopped piecing together outfits from thrift stores and buy myself a few new suits, shirts, ties and a decent pair of dress shoes. These are all things that I have not paid retail for since I was in high school, and truth be told my parents paid for it (yes I was a spoiled brat).

And even with $1,000 in hand I still wanted a deal. So I figured the best possible prices I could get on these items would be right before or after Christmas to take advantage of the seasonal mark downs. Our first stop took us into JCPenny where I’ve had my eyes on getting slim fit suits that are priced a bit lower than 1,000% of cost to start with before sales even enter the equation. Penny’s had a decent selection but not enough variety. So my trek had my next destination set at Macy’s where all suits and related accessories were grossly over priced. I absolutely refuse to pay $300 for a suit, even if it is on sale. Call me crazy but searching on Google points me in a direction that with materials, labor and shipping from regions across the Asia-Pacific, that suits cost between $80 and $100 to bring to market. I would love to pay at or slightly above cost for these items, and through a major retailer I dream to beat them up on price and purchase these items at below cost. But I think it is crazy and outrageous, even with budgeted money, to pay substantially above retail price for the sake of a brand.

Needless to say I did not stay at Macy’s long. The last place on my hit list proved to be fruitful. At Sears my wife and I hunted to find an excellent assortment of what I was shopping for at excellent prices. So after tediously making sure that items fit and my wife giving her thumbs up and down to what she can/can’t tailor personally and triple checking with a sales clerk regarding what was in stock, my search to revamp my wardrobe at reasonable costs came to an end. When all was said and done we had purchased two suits, an extra pair of dress pants, a little more than a dozen dress shirts, a little more than a dozen ties, a belt, a sweet pair of great looking dress shoes and several items for my wife for a grand total was well under $600. And all we had to worry about was how to navigate our way out of the mall now that operating hours had been over.

So armed with $1,000 we took advantage of holiday sales to buy our list and then some and still had over $400 to spare. Our Christmas presents were already purchased and wrapped well before we stepped foot into the mall. And in the end I’ve come to the conclusion that Christmas shopping is not necessarily a bad thing. If you head in with a planned budgeted ceiling and the perspective of a hunter, Christmas shopping can become oddly enjoyable J!

Thursday, December 20, 2012

My Christmas Priority

The Christmas shopping list is completed, the items have been purchased and with the exception of a handful of gifts left to wrap our household is just about across the finish line for Christmas shopping 2012. Now we can get to the business of enjoying the holiday and celebrating it appropriately.

I am happily looking forward to Christmas this year. Aside from being about $70 under our budget I actually managed to have a few days off work this year. In years past I have actually come into the office and worked half days on Christmas. On the income side it was a no brainer. We were working our debt snowball and through my employer when working holidays I get paid time and a half for the holiday hours put in. So it was extra money to help get our snowball rolling. But now, truth be told, we really don’t need the money. Yes we have goals to reach like annual travel, systematically invest and hit the pinnacle point, buy a home and start a family, but I see these as marathon type goals and fiscally we shifted from a sprint to a more maintainable long-term pace.

So what did I replace gazelle intensity with? For me it has always been important to get my time back. Time for myself, time for my wife, time for volunteering and of course time for family. I figured if I could sprint through the early baby steps, build my fiscal foundation and rid my life of debt, later I could start making decisions and choices not based on money but where I want to spend my time. I am starting to feel that the time is now. So I bypassed the opportunity to pick up holiday hours at the office and instead will be spending as much time as possible with family.

Just thinking about making this choice brings me peace of mind. I mean sure, we could use the money from bonus hours to put towards any of our sinking funds, but I honestly think I am hitting a point where I am happy right where I am, in the direction I am moving, and my time is one of the most valuable things I cherish in my life. My ultimate goal is to hit the pinnacle point, where our investments make more in a year than we make for us in a year, and this will be the apex where can maximize all of our time to do exactly what we want to do day in and day out and not rely on an employer for income. But now I am starting to get a taste of having my time back. That is just one of the many blessings that I am thankful for this year, and that I look forward to experiencing more of in the New Year.

Tuesday, December 18, 2012

My Imminent Fiscal Cliff

The fiscal cliff is looming and I for one am licking my chops for the opportunity that will be presented once we are collectively pushed over the edge by the government’s inability to comprise. While Bonehead (Boehner) and The Great Socialist (‘bama) ram their rhetoric minded heads against a wall I am giddy with joy of what is about to come.

Back in 2008-09 the stock market dropped and signaled the formal kickoff for what has been considered “The Great Recession.” Back then I was a young and inexperienced baby gazelle. My wife and I were at the onset of putting together our emergency fund and beginning to snowball our debt. I knew routine and systematic investing would come in our later baby steps, but I wanted to move like a bat out of hell in ridding our lives of debt. Then the market dropped and collectively we were in a free fall.

At that point in our fiscal journey investing wasn’t even on my radar. We were getting through our first steps in building a sound personally fiscal foundation. When we did get to investing I resolved to follow a long term approach of buying a diverse group of historically proven mutual funds in our portfolio and hold each asset for at least five years. But back in ’08 my wife had a, “feeling.”

As the market fell my wife proposed, that for a few months as the market was hitting its perceived bottom, that we pay minimum payments on our debt and begin investing with all of our disposable income through our brokerage account. Admittedly in essence she was trying to time the market to maximize “buying low.” I was reluctant, hesitant and frankly scared to do so. But as Dave Ramsey says, sometimes as a husband you don’t have to mentally, “get it,” you just have to physically, “get it.” So I charted out the free fall for a few weeks and used our disposable income, when I subjectively found the market’s bottom, to invest instead of pay off debt.

As a disclaimer, as of today we have not sold a single mutual fund that we have purchased…EVER! After about 3 months of investing with every dollar we could squeeze out of our budget we went back to the baby steps and eventually became debt free with a fully funded emergency fund and routinely invest for the long term through our retirement vehicles and taxable brokerage account. But nevertheless, buying when there was blood in the streets was fiscally one of the best decisions I have made in the last five years. Our investment returns are solid and we hold a diverse group of mutual funds with historically proven track records and our first dollars investing found us buying these superstar mutual funds at great prices.

So this year I am stoked to base jump in style off the upcoming fiscal cliff. We have close to $5,000 in cash ready to be invested when the market drops. But of course there is always the “what if” factor. What if the government kicks the can down the road and postpones the cliff deadline to Q2 or Q3? What if they reach a resolution? If a resolution is reached or the fiscal cliff deadline is moved I won’t swoop in and spend $5,000 buying mutual funds all at once. Instead I will systematically buy historically proven and diverse mutual funds monthly until the $5k is depleted. If a resolution is reached I’ll work that cash amount to 0 over a period of maybe 3-4 months. If they kick the can down the road I’ll subjectively buy some mutual funds but will still keep at least $3-$4k in cash for when the new deadline approaches.

Please allow me to be clear. I do not advocate trying to time the market. 99% of the investing I do is systematic and consistent over a long period of time. I buy mutual funds that have been around for at least 10 years, have average annualized returns of at least 12% since inception, I plan to hold the investments for at least 5 years, and I spread my investments equally between these 4 types of mutual funds: Growth, Growth & Income, Aggressive Growth and International.     

But every now and then a major geo-political event hits that sends the markets down. In the past it has been things like the Cuban missile crisis, September 11th, the bombing of Pearl Harbor, the dot com bubble burst and the real estate bubble burst. I expect the fiscal cliff to push the overall market down and when it does, I’ll be ready with just a little more cash than usual J!

Monday, December 17, 2012

Our Broken Heart

My heart, thoughts and prayers absolutely go out to anyone and everyone impacted by the shootings in Connecticut last Friday. I would be the first to admit that no amount of financial planning can mitigate the devastation that comes with the loss of life. As a prospective parent this real life tragedy was something I could have only envisioned in a nightmare.

I am not going to use this platform to politicize any kind of agenda. I am also going to refrain from talking about insurance options. Instead I want to extend my heart and soul to all of those impacted and say that you are on the forefront of my thoughts and prayers. My heart absolutely broke upon hearing this news. For too many years too many of our families have suffered through the loss of our children.

No amount of money and no thoroughly designed insurance policy will ever be enough to replace a family member. Even out here where I live I have began to question my own personal sense of safety and have began to question whether my personal faith in humanity has been completely shattered.

But then I see the attendance of makeshift vigils. I read the Op-eds from major news publications. I see comment feeds across social networks and other blogs like this one. And there is a glimmer of hope and an outpouring of love and support from those across this nation (and even world) that encourages me to write this today.

To the friends and families of those impacted from Columbine to Connecticut, I stand with you, I weep with you, I pray with you and I promise to do everything I can and within my power and control to bring joy, hope and peace into this world. I am not going to point blame at guns, policies or even at others. Instead I am going to look internally and ask myself how I am bringing positive change into this world. It may not be flashy. It probably will never grab news headlines. But at the end of my life I will stand before God and look back on my life and know that I cared, loved and supported my brothers and sisters in this world, especially during our darkest hours.


My Debt Free Trip to Hawaii

Now that was quite the sabbatical J! I am back from our debt free vacation to Hawaii and I have to say our visit was refreshing and invigorating. During the spring of this year we paid off my wife’s student loan and we decided to take a celebratory trip back to the islands this year. We are also utilizing an earmarked savings account specifically for travel that we prioritize and save for every month so that we can take lots of little trips and an annual one to a far destination. Travelling together and seeing the world is a priority to us right along with saving for retirement and paying cash for our first home and becoming completely debt free has enabled us to realize these plans and dreams.

One of my points of pride from this trip is that we ventured to 2 islands, Kauai and Oahu, and we check marked everything we wanted to do on our itineraries and came under our planned budget by $2,000. What I find even more remarkable in retrospect is that I feel we did not instinctively scrimp and save while we were out on the islands. We enjoyed dining out for lunches and dinners and we both experienced some spending fatigue while out there.

At first though I had to push myself to actually spend money. We were driving along in Kauai and the morning sun began to break through and we stopped along to get some sunscreen because we only brought carry on luggage on the flight to avoid the check fees for baggage. So I ran into a local market and was immediately appalled at the price gouging done on the sunscreen products I was looking at. I was just about to run out of the store, hop back into our rental car and tell my wife to drive to the nearest Wal-Mart when I heard a voice in my head say, “Just buy the sunscreen and quit complaining, stupid!” What helped is that when we vacation I carry along our daily budget and tally our expenses as they are incurred. At this point (first day) I already knew that we were going to come under our daily budget regularly (we did) and have to get really creative to come out of our frugal spending shells just to even come close to our daily budget amount. So I hit a really cool pivotal point where I put my spending shield down and began to live in the present and enjoy life.

With my notes in hand I made sure that my wife and I knew our daily spending limit but in reconciling that along with our daily activity plans I was at ease knowing that we could enjoy our trip, do all of the things we wanted to do and still not even come close to our daily limit. It really helped me downshift from the hustle and bustle of daily life here in Chicago to a relaxed state of mind and I instantly began enjoying every second of our vacation without worry.

To help deflect costs my wife found excellent rates on At that site she tracked down 2 gorgeous resort locations. In essence the resorts she found are time-share centric and these companies rent out their unsold units on sites like Yes we were offered a pitch to sit down for a timeshare presentation, but if you know me at all I am only looking to invest in real estate that appreciates, not prepay for vacations. So we happily said no to attending the presentation.

Call me odd and weird (I’m happy to be so by the way) but I also enjoy making breakfast while on vacation. So we set criteria for our lodgings to have a full kitchen and we picked up some essential breakfast items and made breakfast for our each during the course of our stay. On this note it’s a piece of my frugality that I enjoy doing and probably won’t ever let go of J. To me it’s a delicate balance to walk between frugal and hyper-consumer. Being frugal to me is fun and enjoyable, I love getting a deal and finding unique ways to off-set costs. Could we have dined out for every meal every day and have stayed under budget? Sure, but the quiet mornings of making a meal for my wife and not having to rush out the door to get somewhere is priceless to me.

We had an absolute blast being back in Hawaii. My wife and I met out there roughly seven years ago while in college and had not been back since we graduated. For the most part our old college spots have remained the same but I was surprised with how much Waikiki has changed. The influx of Japanese tourists has dramatically changed the landscape in my opinion. Newer buildings and improved landscapes have given Waikiki such a modern and new feel to it from the place I remember. Nevertheless it was fun to walk down memory lane and make wonderful new memories in the same locale.

We also received the compliment of the year when a student working the bookstore was surprised to learn we were not undergrads. So even though we are close to 30 we still look like we are in our early 20s! I’ll take that compliment to the bank every day of the week J! We even managed to use our alumni discount when buying some apparel so even on vacation I avoid paying retail. But the bulk of our souvenir and clothing purchases were done as we made time to scour through local thrift stores. We both found great apparel at a fraction of retail cost, and I even walked away with a new(er) collegiate duffle bag for work for literally $2.

We had a fantastic trip back to the islands and are now planning to go back at least once every 2 years. But it is great also to be back in the Midwest in time for Christmas. So I’m looking forward to writing even more posts to close out the year.