Thanks to everyone who participated in the survey I sent out last month. Here are a few highlights:
86% are very satisfied overall
71% are interested in contributing
50% want more articles on travel
50% are most interested in personal growth & health
Someone commented on the fact that the content isn't always relevant to them and cited adventure racing as an example. Perhaps it wasn't clear that I was using adventure racing as an example of something I longed to do for many years and finally achieved. I hope my experiences serve as a catalyst for you to revisit your dreams and take steps to bring them about. Because while you might not dream of competing in an adventure race, you do dream of something.
Dreaming as far as we know is a quality that makes us unique amongst the animal kingdom. There are certain dreams that are nearly universal. We've touched upon a few of these already in previous issues: overcoming physical challenges (Siege on Fort Yargo), travel and adventure (Where in the World?), and educational pursuits (Endings). In this issue I will be highlighting the universal dream of financial independence.
"Follow your dreams, for as you dream you shall become."
Follow is an important word in that sentence because without it your dream is merely a wish. A wish is a desire without the commitment to see it through and you might as well save that for the tooth fairy!
Dreams are your ultimate destination and goals are the well-defined targets that can lead to the fulfillment of your dreams. Without goals, dreams can seem overwhelming in their enormity and without dreams, goals are nothing more than an elaborate To-Do list.
Take financial independence as an example. Sounds great, doesn't it? But what is it exactly? If you don't know what it is, how are you going to get there? Does it mean never having to work again? Never having to work for someone else again? Being completely debt-free? Or, sitting on that beach in the above photo sipping mojitos? There is no wrong answer, only a right answer for you.
Press PAUSE and take a few minutes to think about what financial independence means to you.
I like this definition of financial independence:
"Enough money to meet your needs whether you work or not."
Before we go any further I should offer a disclaimer: I am not a financial advisor or monetary master. I am merely sharing with you some of the reading and research I have done on this topic. Please treat it as food for thought rather than as a prescription for financial health. I encourage anyone who has tips, strategies, or an elderly aunt in need of an heir to contact me (immediately!) so I can (selectively) share the information with our other readers. In the meantime, press PLAY to hear more.
I've read books, listened to audio tapes, subscribed to financial newsletters, and talked to advisers. One of the programs I want to share with you is Transforming Debt into Wealth (TDIW) by John Cumatta. It's a good place to start because it applies to 96% of the population and it's simple to understand and follow. It emphasizes changing the thoughts and behaviors that got us into our current financial mess.
The TDIW program consists of 6 CDs and a 200+ page workbook so consider this the "Readers Digest" version. Hopefully, it will be enough to get you motivated to start paying closer attention to your financial health because like it or not, our finances have a huge effect on our physical health, our relationships, and our feelings about our self.
Here's the program in a nutshell: Be completely out of debt - including your car and home - in as little time as possible, usually between 5-8 years, and then put the money you would be giving to creditors each month, in low-risk investments that will allow you to retire early on the money you earn today.
Principle #1 - Credit is your financial enemy.
Buying things on credit makes you a slave to your creditors. You can't be a slave and financially independent at the same time; the two are mutually exclusive. Advertisers, credit card companies, and banks are in business to do one thing - keep you working for them your entire life. The first step towards financial independence is to stop creating more debt.
Question: What if I am a very disciplined person and pay off my credit cards in full each month?
Answer: Congratulations! You are the exception, but you should still get rid of your credit cards because just having credit cards causes the average consumer to spend 30 percent more than if they were paying with cash. It's just too tempting when you go to the store to replace an iron and see a great deal on candles not to pick up a couple.
Question: My interest rate is 0%. Why should I give up my credit cards?
Answer: 0% interest rates are promotional rates that usually last only a few months. For most of these cards if you are late by even ONE day the rate jumps up 13.99 to 19.99%! They are counting on you being late and if most people weren't, they wouldn't offer it.
Action Step #1 - Cut up your credit cards.
If you were trying to quit smoking would you carry a pack of cigarettes around with you in your pocket? Not likely. So, don't carry your credit cards around with you either. There are things that require the use of plastic - renting cars, reserving hotel rooms, etc. For these, use a debit card. If you feel you need to keep a credit card for emergencies, try this clever solution: fill up a metal can with water, put your card in the water, and then put the can in the freezer. By the time the water thaws your desire to incur more debt may have thawed as well.
You can't become financially independent spending more than you make and making more money won't get you out of debt unless you change your spending habits.
Here are some small purchases that add up to big money drains. Plug these drains and put that extra money to work paying off your debt.
1. Bottled water. If you don't trust your public water supply, buy a filter and a durable water bottle instead of buying bottled water - it's way better for the environment too! In fact, before you buy that next bottle of water, you may want to read this National Geographic article.
Here's the math:
$365 = 1 bottle/day/year ($1/bottle is a conservative estimate)
$55 = filter (each lasts ~6 months)
$26 = 1 replacement filter
$5 = water bottle
$86 = total
That's a savings of $279/year!
Here's the math:
$730 = 1 cup of coffee /day/year ($2/cup is a conservative estimate)
$100 = combo coffee maker (makes espresso and drip coffee)
$208 = coffee ($8/lb every 2 weeks/year)
$122 = creamer and sugar
$430 = total
That's a savings of $300/year!
In a future issue, I will be telling you about the Cascading Debt-Elimination System and your Accelerator Margin. I will also share with you more ways to plug some of those money drains. So, stay tuned!
In the meantime, if you just cant take your eyes away from the screen, read this gentleman's 10 Tips for Financial Independence.
Health & Wellness
I made a realization this week. It's a simple idea, but it hit home so I thought I'd share it with you.
As our interests shift as we move from our 20's (college, playing sports, partying with friends) to our 30's (working, buying a home, possibly raising a family), and into our 40's (advancing in our careers, maintaining our home) so does our metabolism, but our eating habits often remain the same. This is why the average person puts on 10 lbs for every decade older they become.
This has been true for me. As active as I am, I'm less active than I was as a teenager when I was competing in gymnastics, diving, and water polo. Or, when I was in my 20's and played club soccer and rode my bike in the Southern California hills after class. Or in my 30's, when I played softball and still rode a fair bit. Now, in my 40's, while I'm still active, my work- outs have become less intense and regular, and my eating habits have remained more or less the same while my metabolism has slowed.
My weight has reflected these shifts. Through high school and most of my 20's I weighed 117 lbs. In my 30's, I weighed 127 lbs and now comfortably in my 40's, I seem to have settled on a new plateau of 137 lbs.
Now I know there are some of you who can eat ice cream for breakfast and not gain weight, but for the rest of us, we simply can't consume the same number of calories and not gain weight. So, unless you're going to become significantly more active as you age, you're going to need to change your eating habits. To get you started on the path to healthier eating, check out Harvest Eating. They promote seasonal, organic, local healthy foods that are better for you and the environment.
Travel & Adventure
You'll find some delightful international fare on Sharon's blog, Where in the World. Sharon is the young Filipino who was preparing to travel around the world. So far, she's served up tales of biking in Ireland, taxiing with goats in Morocco, and other tasty tidbits from Turkey that I'm sure you'll want to sink your teeth into. Bon appetite!
Here's an excerpt from one of her posts, "Top 10".
Here are some things I've learned about public transportation while travelling through Morocco:
Monday, September 24, 2007