Skip to main content

This Guy Is Kidding Himself

I will admit it; I'm a tiny bit obsessive about money and money-related topics. For example, I just read this little blog entry at scottburns.com with statistics about national net worth. And in the comments someone wrote: "I have to confess I love looking at data like this. I know it’s not a race and it’s really pretty much irrelevant where I stand compared to other people but it is very fun to look at. "

I love looking at this data also. I'm a data person. But this last statement in a comment to the entry is where I totally disagree. "I know its not a race...," the comment states. Well, I disagree, strongly. It absolutely IS a race.

Not What You're Thinking

I'm not saying I think we should all get caught up checking out our neighbor's wealth etc. because that is not what I mean. But I do believe that it makes sense to remain above the median net worth if you can.

One saying that I've heard and that rings true with me is this: "He who has the gold makes the rules." The idea being that poor people generally don't have much influence or choices. They cannot decide to not work, they need the money. Rich people, on the other hand, have options. They can decide where, if, and how to spend both their money and their time. Since they may not have to work, their time becomes much more free as well.

"Rich Dad" likes to point out that working to earn more to spend more is a rat race; a race we should be trying to get out of. I suppose that is one way of looking at it. But even if we "get out" of the rat race, we are still in another kind of race. We cannot simply sit back. If you have your own money, and have more than other people in your normal age/income bracket, it is likely that you will have the most options. And if there's anything I've learned, its that you should always give yourself as many options as possible. With options, comes freedom.
Labels:

Comments

Post a Comment

Popular posts from this blog

On Buying a Lifestyle...with a Fixed-Rate Mortgage

Despite all of the back and forth about sub-prime mortgages and the housing bubble, I am feeling just fine. The reason is that when purchasing, I followed some old advice: Don't expect to flip. In general, I've been told by many people that you shouldn't buy a home unless you plan to hold on to it for 7 years or longer. If the market does well and you decide to sell, fine. But if you want to be sure not to lose money, don't buy something that you only want for a year or two. I've been in my current location for more than 3 years. I like it. And I have no intention of leaving in the short or medium term. It seems to me, that real estate, like any asset class, has its ups and downs. But as a practical point, I don't look at my home as an asset per se. Rather, I consider it to be a fixed expense that I need to survive, much like food and water. Therefore, as long as the payment is reasonable and it functions to keep me warm and sheltered and comfortable, that is a...
Post a Comment
Read more

Do Better With Your Time

Recently, I've been extremely busy with some work commitments. The interesting thing for me is that this increased work activity has really helped crystallize some of my feelings with regard to time. And these ideas are a critical part about my view on personal finance. I'm curious to know if others feel similarly. Time is money. That is, Time, in some way, contains energy. Money, is also energy. In the act of working, I am able to compound and increase the amount of money that I have. I am exchanging my time and effort and thought which are components of my work, for the productivity that I produce. And this production gets me money from my employer. However, the first dollars that I make each day, week, or month are the most valuable. Then the ones that I make at the end are the most valuable. (Forget about taxes for a minute.) The reason is, the first ones help me have a place to live and food to eat. And the last ones are the ones that I can use to really improve my life lo...
3 comments
Read more

Blogging WealthTrack: Christine Benz (Retire Early? Or not?)

 This morning I've watched an interesting video on Consuelo Mack: WealthTrack. Here, Consuelo's guest, a longtime contributor, Christine Benz, a personal finance expert from Morningstar joined Consuelo for a discussion on issues related to retirement, in particular in the current market environments. This conversation is even more interesting against the backdrop of The Great Resignation. I found Christine's advice to be particularly interesting on a couple of fronts. Her advice in dealing with talking about retirement in general, in particular for people who are in the process of thinking about retiring early gave me pause. She is considering the traditional advice of a 4 percent withdrawal rate to be dangerous and indeed, actually concerning. According to the recent research she cites, a 3% withdrawal rate is a better option. Even more than the four percent rule, I think that her comments on annuities are particularly interesting. While annuities have been given a bad nam...
Post a Comment
Read more