Today, I am thrilled to cross another huge writing goal off my list by guest posting on:  Financial Samurai.  I just hope it makes a positive difference in someone’s life out there.  Making a positive difference in people’s lives is the most fulfilling part to me.  So here’s the article I wrote for Sam at Financial Samurai:

DON’T EVER GIVE UP:  SURVIVING 10 YEARS IN PRISON:

I walked into my jail cell. I heard the door close behind me. I had just been sentenced to ten years in prison. It was my first time ever in trouble and I was in shock. I didn’t know what to think.

The emotions came in horrible waves. I felt an overwhelming sense of relief at first. The night before, my attorney had braced me with the reality that the negotiations with the district attorney had not gone well, and that the state was going to be recommending 20 years of incarceration.

In court that day, the judged looked down at me in handcuffs and I heard him read his sentence in shock: “The state sentences you to ten years in prison. Due to sentencing guidelines, you will have no chance at early release or parole. Good luck to you.”

That night the harsh reality of being sentenced to 10 years in prison settled in my mind like slow mental torture. How was I going to survive it? How could I hold onto my sanity with such a horrible future ahead of me?

Read the full 3,000 word article on Financial Samurai by clicking here. 

The post Financial Samurai Guest Post: Don’t Ever Give Up!!!! first appeared on Wealth Well Done.

7 Tips On How to Break Bad Shopping Habits:

Tip #1:  Buying Items on Sale: Don’t Let Sales Fool You!

People spend a lot of money during sales because they assume they’re saving money. In fact, this is exactly why companies run sales. The idea that you’re getting a great deal can propel you to spend money you don’t have on things you don’t need.

When you’re looking at clothes, for example, you might be tempted if something’s on sale for a discount. But if you spend money on clothes you won’t wear, and don’t need, just because they’re on sale, you’re basically setting your money on fire and watching it burn.  Most people have closets full of clothes that were “great deals” when they bought them, but they never get worn because they don’t need them.

Rich people are experts at only buying the things they need, and saving and investing the rest of their income.

Sales are just marketing tools.  The purpose of sales is to inspire customers to make impulse purchases that they didn’t plan on making when they came into the store. The vast majority of “discounts” aren’t worth it, because they’re just marketing gimmicks to get you to spend more money than you would normally spend.

Tip #2: Plan Your Shopping Trips

Rather than walking into a store without a plan and buying whatever strikes your eyes, and is advertised on sale, discipline yourself to write a list of what you need first.  If you know the exact items you need when you walk into a store, and how much money you need to buy them, you’re much less likely to be distracted and tempted to buy shiny things when you see them advertised on sale.

Stop viewing sales as automatic deals.  You only save money if you were already planning to purchase the item.

Just a thought:  Human beings are wired to accumulate as many resources as they can, because we all need resources to stay alive.  Without resources like food, water, warmth, and comfort, you’d die.  You need money to buy the resources you need to live, which is why it’s always smarter to save your money, rather than spend it on a bunch of junk that doesn’t help your mission to survive in any way.

One trick I’ve learned is that you don’t don’t need a ton of stuff to stay alive and be happy.  Re-wire your brain to resist the natural temptation to accumulate unnecessary.  Resist the constant flood of advertisements, sales, and promotions you see in daily America, and instead, accumulate the cash you need to live your deepest dreams.  

Tip #3:  Avoid Going Into Debt

Going into debt should be terrifying!  To me, bad-debt is like a nightmare that transforms your life into a horror story where deranged bill-collector zombies try to suck happiness out of you for the rest of your life.  Don’t do it!  Especially with consumable purchases!

Nobody wants to go into bad-debt, like credit-card debt, when they walk into a store.  But it happens all the time.  While swiping a credit-card might not feel like spending money that you don’t have, that bad-debt adds up. Going into debt for shopping or any other expense is one of the most common bad money habits.

Credit cards are tempting tools to buy stuff you want, especially when you don’t have the money.

Credit cards are often a gateway into the mindset of putting off the real cost of things to try and avoid real financial issues for as long as possible.  But anytime you put off serious issues in life, the bigger these zombie bill-collectors become.  Using credit cards to shop isn’t a sustainable solution, so avoid it all cost.

Why should you avoid credit-card debt?  Because credit-cards typically have much higher interest rates than other types of credit. Falling behind on your payments can have a significant effect on your financial situation, and your balance will only continue to grow each month.

Tip #4: Budget for Shopping

Budgeting is a great way to save the money for the things you want without feeling guilty about it. A clear budget tells you exactly how much you have to spend on every category each month.

For example, if you have $100 left over in your budget after paying for essential obligations, you won’t have to go into debt to pay for buying something that costs $100 or less.  A budget can also help you buy things that you can’t afford.

To become financially secure, and build wealth, it’s critical that you get out of the habit of spending more than you have as soon as possible.

Tip #5:  Making Impulse Purchases Online

The internet makes shopping easier than ever before.  But e-commerce websites are designed to make shopping so easy that you spend more money than you want to!

The goal of online retailers is to inspire you to spend your money, so that they can get rich off your money, instead of you getting rich from your money!

Most online stores now allow you to enter your credit card information and make new purchases in just a few clicks. This system takes advantage of your desire for instant gratification and turns the money you’re spending into an afterthought.

Instant gratification = usually means the gateway into the reality of being broke.

Digital vendors add to this dynamic by constantly sending emails that are designed to make you feel like you’re missing out. From coupon and promo codes, limited-time offers and flash sales, there’s always a new online sale that you just can’t miss.

There’s nothing wrong with online shopping in itself, but many people struggle to control their spending when they shop online. Simply recognizing that online shopping is a problem and temptation, and not a solution to your problems, is the first step toward entering the gateway into being rich.

Tip #6: Unsubscribe From Newsletters

The quickest and most effective way to remove the temptation of online shopping is to simply unsubscribe from digital marketing newsletters.

Take a month-or-more break from credit card usage, because you can’t make online purchases without credit cards.

This prevents you from falling into the traps of marketing emails, and making non-essential purchases, before you’ve had a chance to evaluate your budget.

It’s much healthier to look at sales as a perk for something you’ve been waiting for, rather than an impulse buy to buy something you weren’t interested in before you saw the advertisement.

Tip #7: Delete Your Payment Information

Repeatedly entering your credit card number can be tedious.  But the few minutes it takes to enter your payment information, gives you a moment to think about your purchase before it comes back to haunt you as a regrettable purchase or bad-debt.

Develop your own creative ways to give yourself a few minutes, hours, or days to contemplate every purchase to see if you really need it or not.

Once you train your mind to think about each purchase, you can then extend your thinking time to hours, days, and even months before you make a non-essential purchase.  In time, anyone can break the habit of online impulse shopping.

The Bottom Line On Bad Money Habits and the Tips to Break Them:

Bad financial habits come in many forms, but there are a few common trends that lead people to buy things they don’t need. These tips will help you overcome your current money mindset and develop better habits for long-term financial success.

Building wealth isn’t even about money.  It’s about avoiding the things you don’t need to buy, so that you can buy the things and experiences that your soul dreams of living.

So What are some of the bad money habits you have experienced, and how have you overcome them?

STUFF WE LOVE:

Personal Capital is a net-worth calculating tool that turns your finances into a puzzle that’s fun to solve.  It’s free and makes monitoring your money easy.

Bluehost is how we started this blog.  Launch yourself onto the internet.  Your friends are out there.  It’s an easy to start your blog today.

The post 7 Tips to Break Bad Shopping Habits. first appeared on Wealth Well Done.

I told the kids not to stress about understanding their entire purpose in life all at once.  Their purpose will come in time.  The secret to a successful life, I said, is by staying out of three prisons that will try to incarcerate their souls.  More on these prisons below, but here are the main ideas I tried to inspire the kids with:

I tried to go deeper than a normal motivational speaker would.  I wanted to share some of the insights that I have learned in my 37 years of experiencing failure and success.  Insights such as: There’s many prisons you can get trapped in if you’re not careful with your decisions.

I talked about my past drug-use in my teenage years, and struggles with my addictive personality throughout my life.  I described my feelings when I lost a good friend to a drug overdose when I was 21 years old, and how that horrible event impacted all of my views on life.  I talked about how I chose to abandon many of my old destructive behaviors and relationships after my friend died, and how I pursued a better life that has led to me to the drug-free and successful life I live now on a daily basis.

Ultimately, I tried to inspire them that they can live any dream they want to in life if they start with small goals, and raise their goals with each achievement they make.  What insights have I learned in my 37 years of life that are worth sharing?  To me, life is pretty simple and awesome if you can just master this one powerful insight:

Avoid bad decisions that will incarcerate your soul, and turn your life into a prison, and you will be free to live your dreams forever. 

Important note:  And I don’t just mean the physical prisons.  Every person knows they should avoid the obvious prisons, such as: jails and correctional-institutions.  But I told them there are many other “invisible prions” that are just as damaging to creating happiness as real prisons.  These “invisible prisons” come in many shapes and forms, such as: mental, emotional, and financial cages we lock ourselves in each time we make a bad decision.

I told the kids that the secret to achieving your dreams, is to make decisions that will lead you to freedom, and not get you trapped inside physical, mental, and emotional cages, such as:

Self-Esteem Prisons:    

Too many people in the world get stuck inside self-esteem prisons because someone lied to them in their life.  They get caught in these psychological prisons because some loser in their life once told them they weren’t smart, pretty, or good enough.  They were told they wouldn’t amount to anything by someone who probably hadn’t amounted to anything, and they make the mistake of believing them.

I explained that these lies then create cages inside our minds and they trap our souls inside them.  These lies become like vampire leeches that slowly suck our self-esteem out of our souls.  People who believe lies about themselves become locked in emotional cages for 10, 20, 30+ years, (or their entire life), because they choose to believe they’re not good human beings.  But the truth is nothing is wrong with them.  They are exactly who they should be.  They just believed the lies of another flawed human being.

Achieving your dreams, is all about escaping these mental prisons that want to steal your potential, and lock you inside a black hole of depression.  The secret to success is to unlock your mind from these cages of lies and harmful thoughts.  Listen to your heart.  Be who your soul wants you to be.  You are good enough.  You are pretty enough.  You can be a warrior.  You can change your life.  You can do anything you set your mind to as long as you’re willing to work your butt off to achieve your dreams.

Financial Prisons:

I told the kids that as they graduate college, there’s going to be a lot of banks, credit card companies, and loan sharks that will come hunting for their money.  These credit and lending operations are going to seem friendly and helpful at first.  They are going to offer to pay for their education, and buy them a new car, and a home, and a bunch of nice clothes, and a bunch of junk they really don’t need, as long as they keep signing on the dotted line every time new a new loan is approved and their credit limit increases.

But I warned the kids: it’s all a trap.  Those loans are just financial prisons they want to get you in.  Financial prisons look like fun and a great deal at first.  Until you realize they have to pay it all back with monthly payments eventually. Those monthly payments become so big and overwhelming eventually that they start feeling like nooses around your neck.  Suddenly your freedom to do what they want with your life is gone.  Your ability to think about the dreams you want to pursue is also gone.  You are now stuck inside a financial prison, where your entire life purpose is paying the loan companies back.

Once you’re stuck inside a financial prison, with it’s razor-wire fences of debt, your decisions will be forced to revolve around paying your bills, and not exploring your soul and finding out who you are meant to be.  The more time you spend doing things you DON’T want to do, the less time you have to do the things you really want to do.  That is my definition of a prison, even if these types of prisons are mostly invisible.

Physical Prisons:

I know not everyone will end up in handcuffs and in physical prisons, but 30% of American’s do have a criminal record.  That’s 1 in 3!  So the odds are that some of the kids in that classroom will make bad decisions that put them in the back of a squad car, or a jail cell, or even into a prison-institution at some point in their life.  Making bad decision is a slippery slope if you’re not careful.  These misfortunes can happen to anyone.  A lot of people have had one too many drinks and get behind the wheel of a car.  A lot of people make bad decisions with drugs, and end up waking up in jail for God knows what.  Sometimes people make even worse decisions, that can lead to even worse consequences.

Ultimately, I tried to tell the kids that the easiest way to stay out of all of these prisons in life, is to really focus on the decisions they are making.  I asked them to examine where their decisions leading them to.  What type of people did they want to become?  How could they make better decisions that will naturally lead them to achieving their dreams?

I tried to get them to think for themselves and discover the answers to these questions on their own.  I tried to lead them to the revelation that if they can avoid the three prisons I listed above (physical, financial, and self-esteem prisons), then their life will be in better shape than 80% of the American population out there right now.  If you can avoid the prisons trying to incarcerate your soul, then you will be free to achieve the dreams that you were created to live.

Ultimately, our definition of what wealth means here at Wealth Well Done, is much more than how much money you make or have.  Our definition of wealth is also determined by how many prisons you avoid becoming trapped inside.  The wealthiest person in the world is NOT the person with the most money.  The wealthiest person in the world is the person who has the ability, time, money, energy, and freedom, to go on an adventure in life and achieve their dreams no matter how big, crazy, or wild they are.

I believe wealth is the ability to listen to God full-time, and then execute the vision God gives you.

The kids in the High School classroom seemed to be super-engaged with these insights.  I spoke for an hour for each class, and filled that entire hour up with a segment for questions at the end.  My answers to their questions reminded me of this chart my wife recently made for our blogging friends over at Millennial Revolution.  (If you want to read an even crazier, deeper story that inspired this post, click this link when you’re done reading this article)  This info-graphic below shows the steps it takes to achieve your dreams and live the life you were created to live:

The Steps to Achieve Your Dream Life:

The First Step to Achieve Your Dreams: A Stable Life.  When you first commit to changing your life, just try to stop being a black hole of badness in the world.  Haha.  Take a deep breath.  Slow down.  Pay off debt.  Cut the cord connecting you to harmful friendships and relationships.  Turn to God.  Ask for Help.  Save an emergency fund of $1000 cash.  Do everything you can to stop the negativity spewing out of your life and contaminating your reality.  In this first stage, just focus on making the small decisions that will make your life stable again.

The Second Step to Achieve Your Dreams: A Comfortable Life.  Once your life begins to be stable again, and negative energy isn’t erupting out of your life like an exploding volcano, focus your energy on creating comfort in your life.  Relax.  Chill.  Take some time off.  Take an affordable vacation.  Learn to think happy thoughts.  Become grateful that your life isn’t a black hole spewing radioactive negativity anymore.  Your actions aren’t sucking you into a prison of depression and misery on a daily basis.

Be proud that you saved an emergency fund of $1000 cash in your bank account.  Enjoy your hard-earned comfort.  You now have a buffer between you, and the harsh realities that happen to all of us on earth. Soak in the feelings of your new found peace and bliss.  Enjoy some faith that you will be OK in life.

The Third Step to Achieve Your Dreams:  A Happy Life.  Now that you’re stable and comfortable, begin to seek small achievements and experiences that create happiness in life.  Exercise.  Talk to God.  Listen to your soul.  Make positive friendships.  Enjoy the presence of inspiring humans.  Be grateful for what you have, where you’ve been, and where you’re going.  If you’ve made mistakes in your past, be willing to forgive yourself.  It’s Ok to be sorry.  Make amends with yourself, and the world, and be willing to move on.  You’re only alive once.  It’s Ok.  You can be happy again.

The Fourth Step to Achieving Your Dreams:  A Wealthy Life.  Now that your stable, comfortable, and happy, increase your savings goals (target saving 20%-50% of your income) and start saving major money and start creating wealth!  Focus on creating a positive, healthy relationship with money in your new life.  Money is not a substance that makes you happy.  Money is just a tool — a resource — that can buy your adventures to go out into the world and create your happiness by achieving your dreams.

I believe money is one of the greatest resources known to man because it can be transformed into almost anything by trading it for the things and opportunities you need to achieve your dreams.  This is why it’s important for you to save as much money as you can if your goal is to achieve your dreams.  Money can’t buy happiness.  But it can buy you the adventures you need to create your happiness.

The Fifth Step to Achieving Your Dreams:  Attack Your Dreams:  Take everything you’ve learned from steps 1-3, and all the money you’ve saved in step 4, and the only thing left is for you to travel fearlessly into the world to attack and achieve your dreams.

Remember this for motivation as you go through these steps:  You are going to die one day.  Your time here on earth will end at an unknown place and time.  Don’t die with regrets.  The only way to die without regret is to do everything you can to achieve your dreams while you are alive.  Even if you don’t achieve every dream you have, it’s Ok.  Peace, purpose, and meaning are found in the minds of those who try. There’s great honor and peace in doing your best, and trying your hardest.  I believe dying without regrets is a form of wealth even more valuable than all the money in the world.

So that’s all I have to talk about this week.  Look at the chart again.  What step are you on?  Where do you want to go?  How are you going to get there?  How soon?  All in all, enjoy your life, your family, and your journey.  God bless you as you take your steps toward your dreams:

STUFF WE LOVE:

Personal Capital is a net-worth calculating tool that turns your finances into a puzzle that’s fun to solve.  It’s free and makes monitoring your money easy.

Bluehost is how we started this blog.  Launch yourself onto the internet.  Your friends are out there.  It’s an easy to start your blog today.

The post How to Achieve Your Dreams & Avoid The Prisons That Trap Your Soul first appeared on Wealth Well Done.

I’ve felt a burning desire to write again, like gasoline touching the flames in my heart, so here I am.

My last post was back in April when I was invited on Marketwatch for an interview…

But as the snow began to melt in Minnesota, and summer rolled in with hot and humid days, I felt like I had hit a mental wall and I needed a break from my computer.

I’d spent the previous three years, writing weekly on this blog.

I loved it, but I had gotten to the point where I felt exhausted all the time.

I looked at myself in the mirror and realized I didn’t need more money, fame, or page views to make me happier.

I was already happy.

I stopped myself and re-evaluated my life:

My kitchen was full of food. I live in a beautiful home.  I have a good relationship with my wife.  My net-worth has climbed above $300K.  I have years of savings in the bank.

I realized I didn’t want more work in the form of regimented blog posts.

The thing I wanted most was simply rest, and a summer free from self-imposed writing and deadlines.

I save my money so that I never have to do what I don’t want to do.  I save money so that I can buy freedom over my time.

So I gave myself what I wanted the most…  I took the summer away from writing and just lived, felt, explored, and thought.

We traveled to Colorado to see family, and Washington DC to see our financial friends at Fincon…

One of the best days of my life!

I like to work with my hands on occasion.  It’s a stress reliever for me, and I feel a sense of achievement building equity in my homes.  So I did a few real-estate projects throughout the summer, such as: I built a shed in the backyard of my duplex, and learned how to do my own brakes and install a new front door on my rental property:

Testing out my new landlord saw. :)

Built the foundation first…

Nice shed to store all my outdoor tools in and act as a privacy barrier between the two side by side properties!

And we spent a bunch of weekends fishing and swimming a lot at our family cabin:

This is why we live in Minnesota – The summers are perfect.

Playing a top #3 Minnesota golf course for CHEAP because we know someone ;)

And I worked hard keeping the invoices going out, and the rent checks coming in at my 2 main businesses (promotional sales, and real-estate) so I could keep the cash coming in while I was out having fun in the sun.

I even learned how to buy my first nice car this summer after my 2004 Toyota Camry with 230K miles was rear-ended and totaled in July.  Rather than putting a bunch of money into fixing up an old car, I decided to buy a “newer car” so I could spend the next decade not having to worry about buying another car.  I eventually found this awesome 2018 Toyota Rav4 that gives me a little more space to haul landlording tools around while getting good gas mileage in case gas prices ever shoot into the stratosphere.

I won’t lie.  It does feel awesome driving a newer, fancy car after rolling around in an older car for the last 7 years.  I feel like a rock star when I pull up into parking lots and my appearance now matches the strength of my portfolio.  BUT…  it wasn’t fun writing the $20,000 check to buy the car with cash.  That $20,000 check cleared out most of our emergency fund, but that’s what our emergency fund is there for.  We’re currently working hard saving that $20,000 back up again.

“Buy Assets, Avoid Liabilities,” is the motto of our blog.  So I was pretty happy I was able to buy the car with cash, and still have 95% of our net-worth invested into assets,  Assets are what make you rich.  Assets create wealth.  The path to wealth is buying as many assets as you can (stocks, real-estate, investments) and as few liabilities as you can. (Cars, clothes, expensive homes with high taxes that steal money from you.)

Finally….

By the time October arrived, I had gotten tired of traveling and having fun in the sun, I realized I wanted to write again.  So here I am….

I’ve had to learn that it’s Ok to take breaks. I’m Ok to take a rest.  Life doesn’t have to be 100% work and stressful deadlines all the time to get rich.  The whole purpose of why we save and invest our money, is so that we can do whatever we want, whenever we want, and it’s Ok to take a break when you need one.

The best part of building financial independence is that you never have to ask anyone for permission to live the life you want to live.

So what’s next for us?

We’re going to keep working to get our net-worth to $500K in the next 1, 2,or 3 years.  How are we going to do this?  By being smart and frugal with our financial decisions, and keep re-investing the rent checks, sales payouts, and dividends that we receive monthly.

As Dr Frankenstein said when he created his monster, “It’s Alive!!!  It’s Alive!!”   That’s how I am starting to feel about my portfolio.  It’s growing even when I’m not actively working on it!  Compound interest is starting to take root.  Now we just have to stay focused, on track, and let the investments grow.

I plan on writing over the winter more, so stop back and say hi.  I’ll have a new net-worth update up soon, and I want to share the lessons I learned buying my newer car for $2,500 below its blue book valuation.

Writing is a long term goal for me, so I don’t have to kill myself meeting self-imposed deadlines along the way.  I’m healthy, happy, and feel fulfilled.  That’s always my ultimate goal and I am achieving that dream.   Let’s keep the party moving forward, and always keep reaching for better, more-fulfilling lives to lead.  Peace.

STUFF WE LOVE:

Personal Capital is a net-worth calculating tool that turns your finances into a puzzle that’s fun to solve. It’s free and makes monitoring your money easy.

The post Gasoline Touching the Flames in My Heart first appeared on Wealth Well Done.

To build wealth, just keep checking goals off your list.  Conquer one goal at a time, enjoy the experience, set the next goal and get to work.  I’m re-publishing my interview with MarketWatch below:

“After 10 years in prison, this reformed inmate has multiple streams of income and a new view of life.”

“Billy B., an entrepreneur and salesman, realized he wanted transform his life, save more and become someone who could help others — but first, he had to get out of prison.

The 38-year-old from Minnesota, who also blogs at Wealth Well Done, said he came from a loving family but started using drugs when he was 14. At 21, he was charged with reckless homicide by delivery of a controlled substance when a friend of his overdosed and died after using drugs with him at his apartment. He spent the next 10 years in prison. The next steps were small ones, he said….”

Read the full interview at MarketWatch, by clicking here:  After 10 Years in Prison, this Reformed Inmate has Multiple Streams of Income and a New View on Life. 

The post My Interview On MarketWatch: Multiple Streams of Income and a New View on Life first appeared on Wealth Well Done.

Why do I publish my financial reality on the internet? Because I want to show a real-life example of how real-life people can succeed with money. I want to inspire as many people as I can become wealthy, because it’s one of the best feelings I’ve ever had. There’s a bliss that comes with not having to stress about money.

The truth is, you don’t have to make millions to become a millionaire. Millionaire’s are made $10 at a time. This is my story of becoming a millionaire so I can achieve my dreams in life. So let’s jump into quarterly net-worth update #2. I use the free Net-Worth tracking software, Personal Capital, to track my money. Try it here, it’s fun.

It’s been a nice 3-month stretch as you can see. The market bounced back after an ugly December. My sales business has been busy, which have helped make my paychecks solid. Rent checks have cleared. And compound interest is really starting to make an impact on my investment accounts.

Think about it: I’ve had a +$27,159 net-worth increase since my last net-worth update (A 4-month period) and I’ve only had to save around $15,000 of that from working. Proof that my investment income is starting to create crazy money. Especially since I’m still a humble guy who thinks $100 is a lot of money.

6 years ago, I owned 2 assets worth $10K each. I now own 6 assets worth $20K-$70K each. “It’s the compounding of assets, not just money, that creates true wealth.” – Robert Kiyosaki.  Compound interest is real if you keep making, saving, and re-investing.

The other cool number I’m looking at in this update is our potential down payment for investment property #2. We combine our emergency fund and VTSAX accounts for down-payment money since we can access those funds at any time without paying a penalty.

Those accounts equal $46,000 right now. That’s almost a 25% down payment on a $200,000 investment property, which is what we’d be targeting. That means we can at least afford to buy another one. We’ve even gotten pre-approved for mortgage #3. Now we just have to find the right deal that will cash-flow, and be a perfect long-term, buy-and-hold rental. (In the next few weeks, I’ll write about the criteria we’re looking for in our next rental property. The last property worked out so well for us since we didn’t compromise on any of our rules, so we’re not going to sacrifice on these rules on the next property either.)

Looking at this net-worth update, cash flow is also looking great. $3,463 in totally passive income over a 4-month periods is pretty sweet. My goal is to cover half of my annual expenses (around $16,000) with passive income, so I can further my goal of reducing financial stress in my life. I’m getting closer.

First-quarter (Jan-Mar) will always be a higher than normal cash-flow numbers, because our retirement accounts pay out their annual dividend on December 31^st once per year. Of course I’d have to pay a 10% penalty to access those retirement dividends before age 59.5, but it’s still real money and a cool number to monitor.

I invested my first $1,000 into a retirement account 6 years ago in 2013. My first dividend from that $1,000 was like $10. I’ve come a long ways from that first $1,000 investment, and it’s a pretty awesome feeling to see that Amanda and I have built our retirement accounts to $50,000+ in only 6 years. It’s even cooler to see that those accounts are starting to pay us $1,137+ in dividends every year. I can’t wait to see what my retirement dividends will look like at the end of 2019 after we invest another maximum investment of $12,0000 into our tax-free retirement accounts this year.

Only downside to report, is that our wallets are going to be $3,500 lighter by the end of the day, because… taxes are due.  It’s April 15th today.  Don’t forget to get your taxes paid if you owe like we do this year.

$6,500 to go and we’ll climb into a new 6-figure net-worth into the $300,000 range. What’s our plan to get beyond the $300K milestone? Our plan is to just keep doing what’s got us this far:

We’re going to keep seeking happiness on as small a budget as possible, and aggressively saving and investing the rest of our money.

It feels good to be wealthy, because we can accomplish any dream that comes to mind. Anyone can do this.

So many people want a different life than the one they’re currently living. The biggest thing holding most people back from living their biggest dreams is their financial reality. I write this blog so that you can see the steps one needs to take to improve the financial reality in their lives. Become a millionaire $10 at a time, and go on a mission to achieve the purpose you were created to live.

STUFF WE LOVE:

Personal Capital is a net-worth calculating tool that turns your finances into a puzzle that’s fun to solve. It’s free and makes monitoring your money easy.

Bluehost is how we started this blog. Launch yourself onto the internet. Your friends are out there. It’s an easy to start your blog today.

The post Net-Worth Update #2. first appeared on Wealth Well Done.

I first met POF two years ago at a Minneapolis meet-up.  Later that year, we went on a mountain biking trip to some of the best mountain biking trails in Northern Minnesota and discussed the four traits that have helped him be successful.

He invited me to write a guest post about my search for meaning, happiness, and my search for financial freedom.  Because my ultimate goal is to never stress about money again.  You can check the guest post out here: Christopher Guest Post: Wealth Well Done.  POF opens the guest post below:

Crank It Up To 11:  Wealth Well Done

I prefer my wealth medium-rare, just like my filet mignon.

My friend Bill also likes his beef medium-rare, as well learn below, and I believe we enjoyed a couple of rare tuna sandwiches after a bike ride in Crosby, MN a couple of years ago.

When it comes to wealth, however, Bill prefers his wealth well done. That’s the name of his blog, a site that he’s used as a creative outlet to help others find purpose and fulfillment while growing their wealth.

I’ve known Bill for several years now, and I’ve been impressed with his commitment to sharing his story, which is painful and unique compared to most of us bloggers who weren’t sentenced to 10 years in prison.

Some of us lament our mistakes and struggle to overcome them. Bill made mistakes that led to the death of a friend and a decade in the clink, yet he makes strides daily to overcome those. Think about that the next time you’re feeling down and out about your own problems.

You Can Keep Reading The Article By Clicking Here: Christopher Guest Post: Wealth Well Done.

The post Guest Post: Physician On Fire and Wealth Well Done. first appeared on Wealth Well Done.

We had just finished an outdoor activity class with her.  During small talk afterward, I had told her I write a financial blog as part hobby and business.

I wasn’t prepared to answer such a deep question about retirement as I stared back at her.  Potential answers flashed in my brain like internet hyperlinks pointing to some of the best articles I’ve read on the subject. So many life-changing pieces of literature came to mind, like: the Trinity Study and the 4% rule in retirement planning. Mr. Money Mustache’s article, “The Shockingly Simple Math Behind Early Retirement.” JL Collins book, “The Simple Path to Wealth.” All these references impacted me deeply and did a great job explaining how, and when, a person can retire successfully.

As I thought about how to respond to the question, “How do I know when I can retire?” I didn’t want to spew everything I knew all at once like an exploding volcano. Too much information at once can overwhelm a person.  I didn’t want to feel like I was aiming a flame-thrower right at her head, rather than sparking her curiosity and interest with a little talk about FIRE.

We’ve become so immersed in the financial independence community while writing this blog, that I sometimes forget that most American’s have questions like this floating around inside their brains with no answers. I have to remind myself that a lot of people haven’t yet found their answer to a question like, “How do I know when I can retire?”

At that moment, I realized I wanted to write a post that could tackle this question.  As I started to write my response to, “How Do I Know When I Can Retire?” I broke my answer into the four sections listed below:

#1 Why Retirement is An Artform. Not A Science or Law.

#2 The Math behind Retirement.

#3 Why Do Most People Retire after 60?

#4 So When Can You Retire?

DISCLAIMER: Read our disclosure page before you take my advice as eternal truth or law. I’m only a creative writer who likes to experiment with money and share the lessons I’ve learned.  In 6 years, I turned $10,000 into $300,000, so I have learned some things.

“How Do You Know When You Can Retire?”

The first response that floated through my brain is that there is no perfect answer on when you can retire.  Retirements are like a dream date.  It’s all in the eye of the beholder.  All retirements are different, and all carry some unique risk. Therefor, discovering when you can retire is more of an art-form than a one-size-fits-all science.

My quick thought is that a person can retire whenever they want.  But that doesn’t mean every retiree will experience a successful retirement.  The real question to ask is, “How successful will your retirement be?”  A successful retirement is just having income streams large enough to cover your annual expenses without having to go to work.

So now that we’ve defined retirement, how do you figure out when you can retire?

Since retirement is more of an art-form than a science, your ability to retire will mostly be determined by how easily you can design a lifestyle that you love to live, on a fixed investment-income that you can afford.

Meaning, if you’re extremely skilled at saving and investing, and designing an inexpensive lifestyle you love to live, you can retire rather quickly. But if you’re horrible at controlling your spending, investing, or living life on a modest salary, then retiring successfully will be much more difficult and take more time.

This is my favorite thing about experimenting with personal finance: It’s so personal and unique to each individual. Your financial future is determined by the financial decisions you make today. Want to retire a multi-millionaire?  Achieving that is easy, as long as you make the financial decisions today which will transform your future into that dream.  We all get to choose what retirement we experience by the decisions we make today.

Since retirement is really a personal choice, then the answer to the question of, “When can I retire?” comes down your ability to do the below three things:

#1 How skilled you are at saving money?

#2  How easily can you create happiness on a limited budget?

#3  Do you like learning how to invest to build new investment income-streams?

If you are good at doing the above three things, you can begin creating your retirement at any age.

Ultimately, personal finance and retirement is a lot like living in a choose-your-own-adventure novel. We create our financial futures by the financial decisions we make every day.  The more skilled you are at budgeting, investing, and living frugally, the quicker and easier you can retire.

So Mathematically How Do I Know When I Can Retire?

Answer to the above question: The 4% Rule can tell you when you can retire, and the 4% rule was first published in the Trinity Study.

In 1998 three finance professors from Trinity College published a paper on retirement planning that has become a massively influential document in the financial world. You can read more details of the Trinity Study here. But in short, the study argued that a retiree could withdraw 4% of their investment portfolio per year and never run out of money.

The findings of the study advocated that if you could happily live off 4% of your investment portfolio per year, you could in theory retire at any point in life.

To keep the math simple, if a person invested a portion of their paycheck every week for years into a retirement account, (Here are some of my favorite low-fee investment funds that anyone can buy to help prepare for retirement.) and all those little investments added up to a million dollar portfolio after 10, 20, or 30 years of compounding growth, a person could withdraw 4% of that million-dollar portfolio annually and never run out of money.

What’s 4% of $1,000,000? $40,000! Could you live on a firm budget of $40K a year? If you could, and you had a million-dollar portfolio to withdraw 4% annually, then you could theoretically retire today.  You’d never have to go to work again because you’d have a steady investment income-stream making money for you that could support you without needing to work for a paycheck.

Do you dream of a lifestyle with a budget bigger than $40K annually in retirement? Then just keep doing the math and work longer to save a $2 million dollar portfolio. 4% of $2,000,000 = $80,000 per year. Want a retirement bigger and flashier than an $80K budget per year? Then keep increasing your income, saving and investing rates, and build a portfolio worth $3,000,000+. A 4% withdrawal-rate on $3 million dollars, is $120,000 per year.  As long as you can live happily off 4% of your investments, you can theoretically retire at any time and never run out of money.

Why do Most People Retire in Their 60’s?

If retirement is as easy to figure out as the 4% rule, why don’t more people retire much earlier?  Here’s a few major reasons most people delay their retirement until the “normal” age of 60 or 70 years old:

#1) It’s NOT easy to save a million dollars quickly. Most people don’t want to live the majority of their best years on extremely tight budgets, just so they can retire a decade earlier. Most people need decades to save enough money.  They need to allow their retirement accounts to compound into sums that are large enough to provide significant income streams in retirement.

#2) It gets easier to retire the older you get. At age 59 1/2 years old, you can start withdrawing money from your retirement accounts without paying an early-withdrawal 10% penalty. Therefore, if you delay your retirement until after 59.5 years of age, you’ll be able to withdraw more money, penalty free, than if you tried to retire before 59.5. (The early-retirement blog, Mad Fientist, is a great resource for strategies to access retirement-account money to retire early without having to pay penalty fees.)

#3) More Government programs start to help you retire the older you get. Programs like social security kick in at age 62, creating new income streams to retirees to help fund their retirement.

#4) Medicare becomes a possibility at age 65. Un-affordable health care is one of the biggest reasons most people don’t retire early.  But medicare helps make health-coverage more available and affordable to retirees who no longer have access to employee-sponsored insurance plans. Once you no longer have to worry about paying inflated prices for health insurance, your cost of retirement becomes a lot easier to figure out and balance.  Again, it’s just easier to retire when you’re older.

#5) Risk is scary!! Most people avoid risk like it’s a billion-tooth monster ready to devour them every time they screw up, and early-retirement is a huge risk!   It’s a risk, because the earlier you retire, the longer you are depending on an uncertain economic future to support you. A million dollar portfolio is a huge accomplishment anyone should feel proud of.  But it’s still a risky gamble to think a million-dollars can support a person in retirement that needs to last 40 or 60 years if you retire in your 40’s or 50’s. The mathematics work a lot better when you retire at 60 or 70, and a retiree only has to depend on their million-dollar nest-egg to support them for 20 or 30 years.

So When Can You Retire?

As I’ve shown in the above paragraphs, discovering your unique retirement-date is a 3-part equation to figure out. A successful retirement is part art-form, part mathematical-equation, and part personal-tolerance for risk.

But if you’re creative with your outlook on life, disciplined with your finances, and ambitious with your pursuit of inexpensive happiness, you can find a way to retire at any age you want.

If you want to retire earlier than later, the logic is simple: Be more ambitious during your working career to increase your salary, so you can save more, invest more, and build a portfolio that can support you using the 4% rule sooner.

The quicker you build an investment portfolio that can cover your expenses, the quicker you can unlock the mystery of what retirement date is right for you, your family, and your personal dreams.

So after reading all of that, when do you think you can retire?

STUFF WE LOVE:

Personal Capital is a net-worth calculating tool that turns your finances into a puzzle that’s fun to solve. It’s free and makes monitoring your money easy.

Bluehost is how we started this blog. Launch yourself onto the internet. Your friends are out there. It’s an easy to start your blog today.

The post She Asked Me, “How Do I Know When I Can Retire?” first appeared on Wealth Well Done.

How Buying A Community Center Membership Totally Changed Our Lives This Winter.

We avoided paying for a gym membership for the last five years because we didn’t think we could afford it.  Fitness was one of the things we tried to avoid paying for because we thought we could replicate it at home.  It costs money to exercise at a gym, but it’s free at home.  Free things = More money we could save.

So for the last 5 years, we’ve taken the cheap route with our physical health.  We took the money we saved by not paying for a gym membership, and dumped that money into our investment accounts. 

But to be completely honest, we weren’t always happy with our “free” exercise plan.  Especially during the cold and dark winter months in Minnesota.

Sure, we bundled up in winter clothes occasionally to get outside to snowshoe or ski.  But it was hard to get motivated to exercise in the middle of winter on a consistent basis.

As a result, winter ended up taking a toll on our physical and mental health the last 5 years.  Rather than really pushing ourselves physically in the winter, we were spending the cold nights just trying to survive them. We were passing our time engaging in mindless activities like staring at the internet, watching TV, and sleeping until the next spring season would come around and we could get outside again.

Our plan to be cheap with our physical health wasn’t a total failure.  It did help us increase our savings so we could bolster our financial plan.  But it was causing wreckage on our physical and mental health because were spending 3 months out of the year feeling bored, lazy, chubby, and unhappy.  We felt trapped inside all winter long doing next to nothing.

But this year we finally got sick of trying to survive winter.  We wanted to enjoy all 12 months of our lives.  So we decided to make a change.

Since neither of us were ready to move to a warmer climate (Our friends, home, and business is here), we decided to try something a little easier than moving…  We decided to become members at a fitness center.  We wanted to see if being active every evening, rather than sitting home bored, would improve the quality of our lives.

The decision on which fitness center to join was an easy one for us.  When we bought our house 5 years ago, we had no idea that we lived only 5 minutes away from one of the best maintained community centers in the state of Minnesota. We knew this place existed, but since it cost $10 per visit, and we were being cheap, we rarely checked it out.

But this community center had it all:  a water park, basketball gym, indoor walking-track, full fitness-gym, and even an adult only hot-tub area with reclining beach chairs surrounded by waterfalls and palm trees.

We looked at the membership prices, and surprisingly, I thought the prices were pretty reasonable for what we were getting.  I mean, what price do you put on trying to be happier?  Happiness is worth WAY more than a few hundred bucks over a year for me.

For Example:

A 90-day seasonal membership was $240 for 2 adults.  I instantly thought this seasonal option could be a perfect solution to help us through the dark and cold months of December through February.

A full-year membership was $590 for 2 adults.  But since we’re so active in the summer, I was a little hesitant to spend $600 on something we probably won’t use much during the summer when we’re traveling and outside all the time.

Our Decision:

So on December 1^st  this year, we invested in a gym membership for the first time in our lives to see if it would be worth the money.  We bought the 3-month membership at first to see how much we’d like and use it.  We decided we could always upgrade to a year membership if the fitness center brought us $600 worth of value in a year.

Our Results:

In the first few weeks, we went there every night and we were in awe each time.  For the previous 5 years, we spent our evenings struggling through the dark and cold nights sitting at home.  We felt lost wasting away the winter nights until spring, summer, and our happiness would return.

But everything changed for us once we got the gym membership:

We were able to establish a new winter routine.  Now, after dinner, we would get to the fitness center by 6 PM and still had a few hours to enjoy in t-shirts and shorts.  Did we want to go for a run on a treadmill?  Lift some weights?  Join a fitness class?  Or put on our swimsuits and go for a swim?  Or just relax in the tropical adult-only hot tub area and pretend like we were in Florida every night.   It was amazing that spending a few hundred bucks allowed us to now have an activity to choose from every night  rather than sitting at home and feeling lazy, fat, and bored out of our minds.

We immediately regretted being so cheap the last 5 years, that we had missed out on an easy opportunity to make our lives better.  In fact, we deemed the overall life benefits so enormous, that we upgrade to the year membership for $590 total within the first month.  Because ultimately if you can improve your physical and mental health for $590 a year, we consider that to be one of the best investments you could ever make.

But the investment got even better.

A week after upgrading to the year membership, I was reading through a city magazine we got in the mail, and I saw an advertisement that said certain health insurers would reimburse each member of the community center up to $20 each if they fulfilled certain health goals each month.

I called our health insurance company the next day.  I learned our insurer would reimburse us $20 each per month if we visited the fitness center at least 12 times per month.  I quickly did the math on that deal: I could get $40 per month x 12 months = $480 in reimbursements.  Our membership was only $590 for the year!!!!  So if we just went 12 times a month, an entire year would only cost us $110 out of our pocket for something that had made our winter lives radically better.

It was a no-brainer!  I immediately realized we had made a mistake the last five years.  We had been so cheap that we missed out on a massive health and lifestyle improvement because we had been living in a cheap mindset thinking we couldn’t afford a gym membership.

Ultimately a gym membership is only worth the amount of happiness and health it brings you.  But for us, we learned that it was worth every penny and more.  We use it on average about 5 times a week now.  We work out about 2-4 times a week, and for the nights we don’t want to work out, we bring our swimsuits and relax in the hot tub, beach chairs, and pretend the place is our own personal spa.

In fact, weekend mornings have become my favorite time to go there and write rough drafts for this blog.  The pool is closed to the public on weekend mornings for swim lessons, but they keep the hot tub area open to adults.  So I bring my computer, coffee, and headphones, and usually have the place to myself to write, relax, and take a swim before it opens to the public and gets busy at noon.

The best part is that this will be the first winter in 5 years that I’m not feeling fat and lazy by the end of winter.  I’m not going to have to spend the first few months of spring dusting off my knee joints and back muscles to get into shape.  I already am in shape and spring hasn’t even started yet!!  I don’t have to lose 5-10 pounds of fat I packed on during winter, because I’m already 5-10 pounds under where I typically am in early spring.

I wouldn’t be surprised if the fitness center will help me add 5-10 healthy years to my retirement years because I was able to keep myself in good mental and physical health throughout my 30’s, 40’s, 50’s and into my 60’s and 70’s.  I don’t even know if there’s a price to put on extending your healthy and happy years by half a decade or more.  At the bare minimum, it’s easily worth $590 per year to me.

In the end, the fitness center has become such a major part of our lives that even if we wanted to buy a new house, we’d probably try to buy another house in this area just because our winter lifestyle is so wrapped around our fitness routines now.  It has been one of the best investments and lifestyle improvements we’ve ever made.

For years we made the mistake thinking we didn’t have enough money saved to afford a fitness membership.  But it’s become one of the best investment’s we’ve ever made.

Have you invested in a fitness membership?  Has it been worth it to you?  What’s one non-money investment you’ve made that has totally improved the quality of your life?

STUFF WE LOVE:

Personal Capital is a net-worth calculating tool that turns your finances into a puzzle that’s fun to solve. It’s free and makes monitoring your money easy.

Bluehost is how we started this blog. Launch yourself onto the internet. Your friends are out there. It’s an easy to start your blog today.

The post The Best Non-$ Investment We Made This Year. first appeared on Wealth Well Done.

Mainly, I learned that I need to work harder, and I need to be more self-reliant.  But I also need to be easier on myself and others when things aren’t going perfectly.

This learning lesson was summed up perfectly during our first day in Kauai, Hawaii….

We were picking up our rental car early in the morning after traveling 11 hours the previous day. I was exhausted.   I felt uptight and irritable.  My husband, Bill, wasn’t standing in the rental line as patiently or quietly and it was driving me nuts.

I stared at him.  I got so wound up and short with Bill.  I was ready to have a domestic disturbance right there in the middle of the renal car lobby and tell him exactly what I thought.  I felt like nobody was paying attention to me or the rules of the line, especially my husband!!!

We finally got to the counter to pick up our keys to the rental car.  A native Hawaiian woman greeted us at the front desk when we finally got to the front of the line.  She looked at me, and I could tell she sensed my short-temper and stress right away.  She calmly said:

“You’re in Kauai, Hawaii Honey. Loosen up, everything is going to be just fine.”

You should have seen the smile my husband gave me when the woman said that.  He said, “See, it’s not just me telling you to mellow out about all the little things in life.”

I was shocked when it happened.  But looking back on it, I have to admit it was a pivotal moment in my life.

I never expected that my external stress would be so insanely high that a total stranger would notice my stressed-out behavior and call me out on it!  But she was right, and I’m glad she did it. It made me realize that I have a bad habit of stressing out over small, inconsequential stuff.  I then take that stress out on the people I care about the most, mainly my husband when we are traveling together.

I immediately looked at the woman, and replied, “Thank you. I needed to hear that.”

Because I did.  For too much of my life, I’ve been way too uptight about so many minor and meaningless things.

I need to learn to only be uptight about the big, important things in life, and let everything else just roll off my back like Hawaiian raindrops falling on a palm tree leaf.

This vacation was different for me.  It was different because I have been making huge, positive changes to my life the last few months, and I was worried about losing my routine. I have been working out on a regular basis, and learning how to discipline myself so that I can accomplish more, and regret less.

I was worried while on this vacation that all of the idle time relaxing would cause me to backslide into old bad habits like excuse-making, and daydreaming in a fantasy world.

But now that I am home, I realize I didn’t have anything to be afraid of.  I am a totally different person than I used to be.  I like growing, changing, and learning too much.

I now realize that I have the choice to keep moving forward, or to give up, at any time.

But I am sick of quitting. Quitting has gotten old and it never gets me to where I want to be.  But moving forward has become exciting and it takes me to places I never imagined being.

So that’s what I am going to keep doing: I’m just going to keep working hard and moving forward.

Creating happiness and success is really simple: Just wake up every day and keep moving forward.  If you can do that, you will naturally grow into the person you were meant to be, and live the life you were meant to live.

Ultimately, I came home from vacation realizing this about myself: Every day I live will either be a step forward, or a step backward, for me. I always get to choose which direction I want to go. I will either be going one step closer toward my dreams, or I will be going one step backward.

Nobody can live my life for me. I have to take control of it.  I have to destroy my negative behaviors to allow the positive behaviors to grow in my life.

Today, I am healthy.  I am strong.  I am able to pick myself up faster when I fall short, and I know I am alive for a reason.

I’ll never forget that Hawaiian woman who confronted my uptight attitude while in Hawaii. She made me aware that it’s Ok to lighten up sometimes.  It’s Ok to let loose and let life take you where you least expect.  Just always move forward.

Just like the Hawaiian woman told me: “We’re in Kauai, Hawaii Honey…”

I need to remind myself every day that: “We’re on earth – a giant floating rock in the middle of the solar system – and it’s Ok to loosen up and enjoy this magical ride.  Just improve yourself as you go, and use every day to chase after your biggest dreams.”

Mahalo!

Let us know in the comments what you have learned while traveling:

STUFF WE LOVE:

Personal Capital is a net-worth calculating tool that turns your finances into a puzzle that’s fun to solve. It’s free and makes monitoring your money easy.

Bluehost is how we started this blog. Launch yourself onto the internet. Your friends are out there. It’s an easy to start your blog today.

The post My Everyday Motto: I Am Not Ready Yet, But One Day I Will Be first appeared on Wealth Well Done.