What Happens When the Desire for Wealth Overtakes the Sense of Reason?

May 13, 2011

I recently saw a news article that caught my attention.  The headline was a grabber:  A woman had been arrested for stealing half a million dollars from her in-laws to help pay off her gambling debt.  She had acquired about 14 million dollars in debt over 2 years.  But the real news for me lay in the sentence that followed.  She had also won 13 million dollars over the same period of time.  This fact seemed noteworthy.  Yes, the woman had a gambling addiction.  She was arrested for stealing from her in-laws.  But, she also had an obvious winning streak.  To amass 13 million dollars in winnings takes some luck, or possibly even skill.  However, by the end of her run (which coincided with criminal charges!), with all of her time and money she was no better off, indeed much worse off, than when she started. Continue reading “What Happens When the Desire for Wealth Overtakes the Sense of Reason?”

What the Navy Seals can Teach Us about Executing a Plan

May 06, 2011

The biggest news story all over the world right now is the U.S. Navy Seals Team Six’s mission into Osama bin Laden’s home.  This event has created an incredible amount of emotion across the globe and as of this writing, a controversy over publishing photos.  While I won’t go into a political discussion here or a religious one either, there are things that we can all take from this event and apply to our own lives. Continue reading “What the Navy Seals can Teach Us about Executing a Plan”

Good News Doesn’t Generate Headlines

April 29, 2011

So, I was in an airport waiting for yet another flight that’s been delayed, and I read this article about famous pro athletes that go broke within what seems like days of retiring.  The story is primarily about Latrell Sprewell, a former NBA star who turned down a $30 Million offer because it wasn’t sufficient enough for him to be able to feed his kids.  That line about feeding his kids became a punch line of sorts about the rich, pampered, spoiled athletes and stars who seem to run through money like they can simply print more.  (Wait, isn’t that Tim Geithner’s job?)  Rather than piling on and saying, “Yeah those guys are _________,” I’d like to tell a story about a different kind of person than the ones that make the headlines. Continue reading “Good News Doesn’t Generate Headlines”

Six Steps to Follow to Help Improve Your Credit Score

April 22, 2011

With the American economy still not firing on all cylinders, unemployment at very high levels (the rate only seems to come down when people have received the maximum number of weeks’ payments and fall out of the workforce altogether), and no sure signs of economic recovery imminent, it doesn’t surprise me that one of the topics that I talk about with people on a very regular basis is how to rebuild credit scores after a period of unemployment and falling significantly behind on debt obligations.  I don’t have any data to support this, but it seems like the average credit score of all Americans has probably dropped 100 points or more in the last several years.  (I think I just found a weekend research project for myself.  Yep, I just might need a hobby.) Continue reading “Six Steps to Follow to Help Improve Your Credit Score”

Financial Planning: It Starts with a Simple Goal

April 15, 2011

When I read the article, Sumo Wrestler becomes Heaviest Man to Ever Finish Marathon, about a Sumo wrestler who ran and finished the Los Angeles marathon and in doing so became the world’s heaviest man to ever finish a marathon (~400 lbs.), I felt inspired.  If you look at most marathon runners, the LAST THING you think of is sumo wrestling.  When you look at sumo wrestlers, the last thing you think of is long distance aerobic exercise.  That’s what makes this story so interesting to me.  This guy (Kelly Gneiting), not only did something that most people would think he had no shot at doing, he has set the bar even higher.  He wants to swim the English Channel.  He knows how to set goals and not only achieve them but set them higher again after reaching the 1st goal.  Many people could learn a thing or two from him. Continue reading “Financial Planning: It Starts with a Simple Goal”

Financial Advisors Speak Financial Mumbo Jumbo

April 08, 2011

I read a great column about the financial planning/financial advisory business recently.   The column was a mock conversation between a financial planner (who wanted to look at the big picture before offering ANY advice and spoke mostly in financial industry jargon) and a prospective client (who was looking for VERY specific advice on several topics and immediate investment recommendations, “ Should I buy gold?”). Continue reading “Financial Advisors Speak Financial Mumbo Jumbo”

Financial Goals: Looking for Greener Pastures

April 01, 2011

My girlfriend and I joke about her country life in upstate NY (almost Canada!) versus my city life in Baltimore.  While this time of year brings blossoms and green grass in my neck of the woods, her climate is still dominated by brown grass, barren trees, frigid winds and the residue of salt from the endless maintenance of those snow-laden roads.  She laughs as I brace myself for the cold every time I walk out the door of her house.  “My weather is so much better!” I joke, but deep down I am serious.  I am always wishing her weather was my weather.  I am always wishing my drive for a visit was on my terms…green, lush, and just plain old bearable. Continue reading “Financial Goals: Looking for Greener Pastures”

College Planning: A Conversation that Might Save Me $100,000 or More

March 25, 2011

One night not too long ago my daughter and I had a really good conversation about life, choices people make, who we like in this year’s American Idol (James!), and why she thinks her milkshakes are better than any that you can buy at an ice cream shop.  I’m sure there were plenty of other topics discussed too, but those are the ones that I remember the most.  And, she REALLY can make a mean milkshake!  Hey, a dad has to make sure that his kids don’t lie, right??? Continue reading “College Planning: A Conversation that Might Save Me $100,000 or More”

Money Management: Are Mega-earning Youth Receiving Too Much, Too Soon?

March 18, 2011

I read this article about Billy Ray Cyrus’ concern for his daughter Miley.  (I have a daughter, so you shouldn’t laugh at me for knowing who Hannah Montana is and being caught up in observing her personal drama.)  She isn’t the first, nor will she be the last child star to earn a fortune.  There seem to be more stories about “child stars gone wrong” than there are about those who have taken their fame, celebrity and wealth and done something good for themselves and their families.  Maybe it’s that only the train wrecks get reported – it’s not newsworthy when someone helps others or fades from the spotlight into a well balanced adult life, but that’s a different topic for a different blog.  While reading it, I started to wonder if the whole combination of youth and wealth is a poor one. Continue reading “Money Management: Are Mega-earning Youth Receiving Too Much, Too Soon?”

Retirement Preparedness: A Wake-Up Call for Generation X Investors

March 11, 2011

Talking with a group of pre-retirees, one of the people in the room (a born entertainer) used Styrofoam coffee cups as visual aids to illustrate his point.  We were talking about incomes and expenses during retirement, and he broke out into a comedy routine/illustration of his financial life.  He filled a big pitcher with water and filled the first cup, broke out a Sharpie and labeled it “Pension.”  He had been an employee of the phone company for 40 years and has a very solid pension income.  The next cup he labeled “Social Security” and he filled that cup about ¾ full.  The 3rd cup he put a few drops of water into and labeled it “Investments.”  He said the 401(k) plan arrived a little too late in his career and he had not participated until the last several years of his career, plus he had a number of children that all went to college which left his personal savings and investment balances rather low. Continue reading “Retirement Preparedness: A Wake-Up Call for Generation X Investors”

Financial Lessons from a Group of Retirees

March 04, 2011

I have had the opportunity lately to talk with a number of people who have been retired for at least a decade.  I asked them to take a look back at their financial lives to see if there were any lessons they had learned that today’s workforce could learn from.  All of these people were comfortable financially and had successful careers in their chosen fields.  I did not expect to hear so many comments about what they would do differently if they had the opportunity to turn back time.  They had some advice for their grandchildren’s generation, and here are just a few of their observations and recommendations: Continue reading “Financial Lessons from a Group of Retirees”

Frugal vs. Cheap: How to Tell the Difference

February 25, 2011

In my prior blog, Car Buying: A Way to Save a Fortune, I talked about how I like to be a bit frugal when it comes to buying my cars.  Many of my friends have read that blog and, of course since they’re my friends, they aren’t afraid to chime in and tell me what points I failed to make.  With friends like that…well, you know the rest of that line.

Here’s the overwhelming commentary I got from people I know.  There is a difference between being frugal and being cheap.   Continue reading “Frugal vs. Cheap: How to Tell the Difference”

With Football and Financial Advisors: Loyalty is Everything

February 18, 2011

A few weeks ago I had a conversation with my girlfriend about the concept of loyalty.  To products and services.  And football teams.  I guess I should add some background information here.  I have been a lifelong football fan and she is just learning about the game over the last few years and frequently asks awfully insightful questions.  One of her recent questions was about what happens when a player from another team that you don’t like comes to play for the team you do like.  For full disclosure, I grew up in the Baltimore area and I’m a Baltimore Ravens fan (and I really don’t like the Pittsburgh Steelers and Indianapolis Colts).  My answer was that most fans root for their team regardless of the players on it.  We essentially root for laundry.

[YouTube video: Seinfeld] Continue reading “With Football and Financial Advisors: Loyalty is Everything”

Why Financial Knowledge Isn’t Enough

February 11, 2011

Last week I talked about how there is an enormous volume of financial knowledge available to anyone willing to look for it.  Heck, you don’t even have to look, it’ll find you if you let it.  But even with the mountains of knowledge out there about how to become financially independent, there are countless people under financial stress who are considering bankruptcy, facing foreclosure or eviction, or who are a missed paycheck away from disaster.  How do we turn this knowledge into action? Continue reading “Why Financial Knowledge Isn’t Enough”

Why Financial Knowledge Isn’t Enough

February 04, 2011

I was reviewing my notes on the last 10 people that I have talked to about debt levels that they feel are overwhelming enough for them to contemplate filing bankruptcy.  Along with having high levels of debt, there is something else each of these 10 individuals have in common.  Knowledge.  They all knew that they were spending more than they were making.  They all knew that credit card interest rates are high.  They knew they should save for retirement and create a household budget.  They all had knowledge, lots of it; these are smart people.  We’ve all been taught that “knowledge is power,” but knowledge alone isn’t enough.  This article, Financial Literacy Won’t Fix Everything, talks about the limitations of financial literacy programs and how lots of knowledge doesn’t always equal sound financial behavior. Continue reading “Why Financial Knowledge Isn’t Enough”

8 Reasons Why it’s Now Better to Rent

January 28, 2011

In the last month, I have had at least 4 people in the early stages of their career tell me that they plan to rent rather than buy a home because they feel that home ownership is “just a myth” now.  They made compelling arguments as to why they prefer to rent rather than purchase a home.  Here are a few of the points that they have made: Continue reading “8 Reasons Why it’s Now Better to Rent”

Car Buying: A Way to Save a Fortune

January 21, 2011

One of my neighbors was telling me about the car he was thinking about buying.  It’s not a flashy car, and he is very happy that he’s making a “frugal choice.”  Because it’s winter, he is concerned about driving in the snow and ice that is all too frequent in the Northeast, so he is buying a Subaru wagon with all wheel drive.  The car is a few years old and has roughly 50,000 miles on it.  The mega-store that has a no-haggling price structure is selling this particular car for ~$20,000. Continue reading “Car Buying: A Way to Save a Fortune”

Investing: The Benefits of Starting Young

January 14, 2011

Over the past few weeks I have had the opportunity to meet with a number of people who are recent college graduates just starting their careers.  Boy, has the world changed a little bit since I graduated!  The first thing I noticed is that starting salaries today are what managers’ salaries were when I was starting my career.  And, as my kids would tell you, back when I graduated from college I still had to feed my pet dinosaur on my way to work.  Is it wrong to occasionally want to sell your kids on EBay?   Back to the point. Continue reading “Investing: The Benefits of Starting Young”

Christmas Toy with a Financial Purpose

January 07, 2011

As the father of three kids, the whole concept of toys for Christmas can sometimes be frightening.  The words “some assembly required” put fear into the hearts of parents all over the world.  I’d love to know what the line is between “some” assembly required and “MAJOR” assembly required!  But, I digress.

One of the coolest things I saw this year was a gift that my girlfriend’s son received.  It was a piggy bank that counts money as it is placed into the bank.  It was cool to hear “ten cents, you now have one dollar and fourteen cents” when I put a dime in the bank. Continue reading “Christmas Toy with a Financial Purpose”

Financial Planning: New Year, New Goals

December 31, 2010

Year end is a perfect time to take a look back at the progress you made in your financial life in 2010 and set new goals for 2011.  So many New Year’s resolutions fall by the wayside by St. Patrick’s Day.  (Dialing back on the chocolate consumption makes my list EVERY year.  Still, there’s something about dark chocolate that is stronger than my resolve.)  There are some resolutions, though, that are not only good for you but sustainable.  And, maybe a bit more realistic than my dark chocolate resolution too. Continue reading “Financial Planning: New Year, New Goals”