A 10 Point Financial Survival Guide for Your 20s

It’s been said time and time again that we Millennials don’t appreciate the value of hard work. That we’re good for nothing deadbeats who don’t have any goals or ambitions.

If I felt that were true, then I wouldn’t have started New Inceptions. However, I know that there are many of us who are doing great things, but due to our focus on those great things, we start losing perspective in other areas of our life.

One of the things I believe that many of us don’t get the chance to focus on is finances. I know I didn’t know how to handle most of my finances until after my mom passed. It was because I suddenly had my inheritance that I was like “whoa, I need to figure out what I’m to do with these funds!”

So, now that it’s been a few years of managing assets, I feel that I should share with you some of the things that I did that have helped me keep above water.

Things I wish I would have Done in My 20s

1. Educate myself more about how long term investing works with day to day expenses. You know, I talk all the time about how I started paying attention to finances when I was in high school. And later in my early 20’s, I read Rich Dad Poor Dad series of books. But the truth is, the stuff I learned about finances is so out there from your day to day issues, that I started living for the future and not really paying attention to money planning that would benefit me in the nearer term.

For example, until 2011, I had no idea what IRAs (Roth or traditional), mutual funds, and annuities were or how they worked. I had no idea what index funds were and why I might like those more than mutual funds. No idea. I had no idea what I could be taxed on until I was actually taxed on it. Common Stock vs Preferred Stock? Distributions? Not a clue.

However, I have found some resources that have helped me get a better grip on where I am and what I’m looking to do, and I believe you’d get plenty out of them yourself.

Radio and TV:

  • Dave Ramsey Show (Start here if possible! Kinda all over the board.)
  • Suze Orman (She can be pretty truthful at times. However, you can tell she has passion!)

Blogs:

Books:

2. Build a Line of Credit

If you’re worried about taking on debt as a 20 something, that’s fine. Especially if you’re in college and don’t have a way to pay pack a huge debt that you can easily rack up on credit cards. That said, you need to realize that eventually you’re going to probably want to get a mortgage for a house. Let me tell you this can be a problem, even if you’re willing to put in 50% of the down payment. Any credit card will do nicely for this. Personally, I recommend something with a $1000 limit so that you don’t get tempted to use money that’s not yours on that new TV or wardrobe.

3. Start Tracking My Credit Score

If you’re going to start a credit card, you need to keep track of your credit score. The easiest way I’ve found to do this is by using a free service, but many times you’ll find out that they somehow start charging you on a monthly basis if they ask for a credit card or bank account. The best way to do that is through one of the three credit bureaus such as Equifax.

4. Start Watching My Identity

There are tons of ways that a person’s identity could be stolen today. So when you do use a card, you should probably figure out a way to put monitors up for your own piece of mind. Personally, I have two subscriptions. I use LifeLock AND Equifax to monitor my identity. I would think that LifeLock is good enough (there’s different plans available – I think mine is $100 a year?), but Equifax and the other credit bureaus have the ability to actually do something about your credit while LifeLock just monitors.

Even if you don’t get a service like LifeLock, I recommend checking your credit score at least once a year.

5. Start a retirement account.

Many people think that the word retirement refers to an age. To me, retirement doesn’t take an age. It takes an amount of money. It is the point where you no longer have to work to support yourself. Am I to that point? No. I don’t know if I ever will be. However, that doesn’t keep me from investing. The sooner, the better. In Tony Robbins book, he says, “You have to commit a certain percentage of your income to savings for your financial freedom. Whatever that number is — 10%, 15% — stick to it in good times and bad. Have it taken automatically from your paycheck and put directly into a retirement or savings account.” He says that if start doing this from your 30’s or especially your 20’s, you’ll live comfortably just as you hit your mid 50s.

In other words, it’s better to own a piece of Apple then it is to own the newest Apple phone. Personally for me, as I’m writing this, the one stock I do have is in Tesla and currently it’s up from where I bought it at $189/share to roughly $280/share. I also have a couple annuities, a mutual fund, and ownership in a couple of businesses, and some other odds and ends. Make money work for you sooner than later.

6. Start an emergency fund.

Even if you happen to strike it rich in your 20’s through your first job, you need to save some of that money. Always pay yourself first. Yes, I’d recommend starting to invest some of that, but you also need to keep some of it relatively free just in case. I mean, let’s face it – stuff happens! Instead of taking on more debt to pay for an accident with your car or first house, you’ll be able to pull from this emergency fund. I’d say make it a goal to set aside $1000 as a good starter amount. As you get older, you can increase it to better suit your needs.

7. Make a Plan to pay off Student Loans.

Currently, most of us who go to college do so partially thanks to Fannie Mae and friends. So make it a goal to start eating this elephant one bite at a time as soon as you get the previous items knocked out. First and foremost, get to the ones that have variable interest rates. You never know when the government will jack these up. After than, start looking at your federally backed loans. While the smaller per month payments might sound more manageable, in the long run you’re actually paying more through the interest. If you’re single and working, now’s a great a time as any to get started on repaying your loans. Get them knocked out before you start trying to do anything else in life such as starting a family or buying a house. I’d recommend using 10% of your paycheck towards paying them off.

8. Hustle Everyday (or at least every other day)

I was just listening to a podcast of Lewis Howe’s where he interviewed Kimberly Guilfoyle. Besides the fact that she’s a ball of fire (and if you listen to the interview, it’s easy to see why), she also has hustled most of her life. I mean, wow. Her track record is totally impressive. One part of the interview that stuck with me was when she was talking about when she was in school that she not only was a full time student getting a 4.0, she was also doing an internship at the local DA AND was manager in retail. I mean, that’s like… super hard. Being a student getting good grades was hard enough, let alone adding two other completely different roles on top of that!

Obviously, this shows that she hustled. She didn’t want to have loans when she was done. But it’s not like she did anything special. You can have her results too. Maybe instead of taking a non-paying internship, you can pick up something part time? Or if you already do work part time, perhaps you can pick something else up? Maybe be a tutor if you’re a upperclassman? Or if you’ve already graduated and are working in your first job, maybe the best thing you could do is start your first official business?

The point is, don’t put all your eggs in one basket. You never know what’s going to fall out the bottom.

9. Become a Picker

One of my favorite shows that I’ve been watching for a few years now is American Pickers. I started watching because of the old junk that they found and found value in – I inherited plenty and have a curiosity about it. Anymore, however, I’ve been watching to see how they start their negotiating with the people that they buy from. If you think about it, negotiation is something that those who are highly successful in business deals know how to do. Also, if you’re familiar with the movie Erin Brokovich, you’ll remember this clip. Needless to say, if you can learn to make a strong case to get something you desire, you’ll have the world by the horns.

10. Set Long Term Goals

Even though I read Rich Dad Poor Dad in my early college years, I never truly set any goals from reading it. I think if I had, I would probably be in a different financial situation than I am now. I’ve recently come to the conclusion that when it comes to goals, you definitely need a destination. However, I don’t know if the steps are nearly as important as everyone eludes to. If you don’t take part in the journey, it doesn’t matter where your destination is, you’ll never get there. Right?

If this is the case, it makes sense that we should be able to vividly describe what our ideal goals are. Where are you? Who are you with? What are you doing? These are all things that I think you should think about as you’re on your journey. That end might change a little here and there, but you’ll be much better off for doing it than if you had not.

Whatever your goals are, write them down and start working on them asap.

Can you think of any other financial goals a 20-something should do? Share them below in the comments!

5 Ways to Make Marriages Work

So, a few weeks ago during the middle of the Millennials as Entrepreneurs series, there was a little article that made some waves in my Facebook News Feed. While many friends agreed with it, Maria and I kinda thought it was a little off center.

As we were reading it, it occurred to both of us that the problems that the author, Anthony D’Ambrosio, noticed were superficial problems. That said, I think in general that the problems that many Millennials have are due to much deeper problems. Problems that are going to take some actual time and possibly some self investigation to figure out.

So, here’s my tough love advice in how Millennials (well, really, anyone) can make marriages work. After reading this list, I hope you’ll have better luck in the marriage department!

Statement 1: Sex Becomes Almost Non-existent

My Response: Check Yourself Before You Wreck Yourself

First and foremost, let’s not confuse sex columnists with relationship columnists. They are not one in the same. Sex experts generally run in the same circles as pickup artists and porn stars, while you usually find relationship columnists in circles of people like John Maxwell, Les Brown, or a Gary Chapman. They’re typically not the same people.

Need an example of who you might listen to? Ok. Then let’s take an example that I’m sure you’re familiar with: Dr. Drew Pinsky of Loveline.

Now, Dr. Drew has been in many of our lives since we were growing up. (It’s still hard for me to not think of him AND Adam Carolla hosting the show.) However, he’s not just about sex, even though many of us would think he is. He’s actually a licensed Physician and Surgeon. On top of that he’s been married since 1991 and has a couple of kids. So obviously, you can listen to him as he does have experience.

In contrast, sex educators like Emily Morse and Sandra Daugherty, while they might actually have credentials to talk about sex, you can tell just by listening to their podcasts that they have issues with relationships.

Also, you’ll also notice that in the political spectrum, relationship experts are generally more conservative while sex experts are more liberal.

So make sure you’re getting advice from the right kind of expert here.

Now that we have that ironed out, here’s something else to consider. Gary Chapman’s book, The 5 Love Languages tells you all you need to know about filling up your partner’s love tank. In the article, Anthony says that sex is the “most important part” of a relationship. Well, there’s a type of person that’s like that in Gary’s book. There’s also 4 other types of people who think that the most important part are other things.  One guess is that Anthony and his spouse might not have had matching love languages.

My recommendation? Find a partner who shares the same love language you have so that you don’t have to think about what fuels their fire, so to speak. 

Statement 2: Finances Cripple Us

My Response: Learn How to Live Under Your Means

Having grown up as the only child of a single mom, I’ve kind of always known about the problems of the household. People need to vent at times and frankly who else was she going to tell? Of the many things that my mom could have talked about, the thing that she did talk about the most was finances. I think mainly because she didn’t understand them herself until she was in her late 40’s. Even then, she wasn’t a master. So she made sure that I was interested enough to study them myself. In the end, I learned how to be frugal. Lol, who am I kidding. I might suffer from being a tight wad… but I’d sooner be that than out on the streets.

One of the things that Anthony talks about is that he can’t live life because of all the debt he has.

Well. I don’t have debt. Not much, anyway. Hell, I didn’t even have a credit card until a couple of years ago. Why? Cause either a.) I worked my tail off to get what I wanted in college and bought with cash. or b.) mom helped.

NEEDS vs WANTS

However, her helping me didn’t come free. There was a trade off somewhere. Many times my WANTS were put aside for my NEEDS. For example, I’ve never owned a brand new car. Would I like one, sure. Who wouldn’t? But instead at college, I rolled around in my 1983 Oldsmobile Firenza and later my 1995 Chrysler Lebaron. I made the trade of getting a college degree vs having a sporty looking import. (A side note, it’s 2015 and I just scored an awesome 2007 Dodge Magnum. Pretty pimp if I do say so myself. Has the space for the future me but the engine of the now me!)

Another want? To go on vacation. Like, for it to be paid for and not worry about money. As far as vacations go, the last vacation I took was my honeymoon in 2013. Thanks to gifts from my wedding. Before that, the last vacation I had was in 2003 to Las Vegas… where I didn’t play anything more than $50 at the slots? All other trips I’ve taken have been road trips to visit family. Not really vacation.

Don’t judge your life based on other’s high points.

Another thing he mentions is that he sees others having awesome lives. That we’re “forced to see the life everyone else is living.”

I don’t know what kind of life he’s living, but the awesome pictures that I see others posting on Facebook and other social media are more than likely those people’s high points. To judge yourself based on an endless stream of those highs, is really not fair to yourself. So stop it. Seriously. The people who travel all the time? They probably aren’t in a steady relationship unless you see that person too. The person who posts pictures of their family? They probably desperately want some alone time. One thing that has helped me out quite a bit is learning how to curate my news feed. Now all I get are pictures of cats, memes, and political stuff. Totally ok by me!

That said, if you have no idea how finances work, then you’re going to be the victim of your circumstances. Unfortunately, that rarely ends up at an ideal destination. Want to start learning about finance? A great source would be Dave Ramsey’s show and/or podcast. He’ll give you all the tough love you want.

Statement 3:We’re more connected than ever before, but completely disconnected at the same time.

My Response: Put down the controller and go outside, kid.

People who can’t learn to put down their phone or tablet or put down their laptop, apparently were never told to go play outside as a kid. I admit that I am the definition of a gamer and even I know when I’ve had enough. But that’s because I’ve been around technology all my life. I was a geek before it was trendy. I have this clock inside of me that tells me when it’s time to do something productive.

So, first hand, I’ll tell you this: If you want to lose time quickly, stare and interact with a screen that has moving things on it. Time will fly by, I guarantee it. Likewise, as an adult, poking at social media all day isn’t any different. The same synapses are firing in your brain.

Going outside to play makes life slow down as a kid. As an adult, putting down your phone and just being present is what you should be striving towards. Stop worrying about things you can’t control. You’ll drive yourself insane if you do otherwise. Don’t let your social media and technology control you. Learn to control it. Learn to know when enough is enough.

Statement 4: Our desire for attention outweighs our desire to be loved

My Response: There’s an empty hole inside you, dear serial selfie taker.

I have never taken a selfie. Not once. Have I had other take a picture of me? Yes, of course. There’s a difference. In my case, a big difference. I’ve never enjoyed having pictures of me taken – even when I was a kid. I know a part of it was that I didn’t like looking good in pictures – that kind of still lingers to this day. However, I think the biggest thing was that I didn’t like being the focus of attention. I’ve never been interested in being a celebrity.

However, there’s a difference in being a celebrity vs what celebrities have, don’t get me wrong. If I could be a part of the infamous 1%, I would. Even with the media hating on them and people constantly trying to assassinate them or the need of constantly having to worry about million dollar deals on a daily basis, I’d think that would be awesome. Why? Simply because with money does come options to help people in ways that no one person can do otherwise and frankly, who wouldn’t want the ability to have the finer things in life if it was desired?

But outside of being a teacher and speaker, I have no interest in being in front of people. If I am going to be in front of people, I better be adding value to them. 

Statement 5: Social media just invited a few thousand people into bed with you.

My Response: This is actually a continuation of Statement 4…

Ok, so you don’t take selfies. I’ll give you points for that. But why would people feel it necessary to take pictures of their wardrobes? Or during their date? Why? What’s that going to get them? Again… you’re going for bragging rights or least some form of being a celebrity. The last I heard, true celebrities are made the old fashioned way. They’re selected by the powers that be. Just because some people Liked your last Instagram picture, doesn’t make you an insta-celebrity. If you want people to stick around in your life, leave them feeling better than when they came in it. They’ll never forget you.

So, that’s just my 2p…

What about you? Are you or anyone you know struggling with the above problems? Are you guilty of some of these? Is your significant other? How about a friend and their mate? Did you say anything similar to what I’ve said above? In the comments below, I’d like to hear about cases in your life… and if they were a friend, what you told them!

Millennials as Entrepreneurs, Part 6 of 10: The 2nd Coming of the Lost Generation

It is said that we are a generation of victims. That we feel that someone has wronged us in the past. And due to that, many of us feel that we are entitled to some sort of compensation.

 

For many of us, that wrong was when our elders told us that there would be a job at the end of our college years. For others, that wrong was being told that they needn’t worry about a job because they would be taken care of.

 

Either way, we were told about something that wasn’t there. Many of us are still looking for the cheese at the end of that maze.

 

The Rich Get Richer, and the Poor Get Poorer… Right?

 

We’ve heard this many times before. But have you ever thought why this is the case? If you’re not familiar with how Washington works, then you might not know that there are people called Lobbyists who contribute to a campaign (read: bribe) for members of congress to do favors for them. Supposedly there’s supposed to be all kinds of regulation for this, but in reality it doesn’t seem to be that way.

 

What works for the rich in Washington generally works for the rich elsewhere. Obviously, money talks. So those that have money have the power. Those without money are fight a losing battle daily.

 

The Poor get poorer because they try to play by a system that doesn’t cater to them.

 

Let’s pretend that I’m poor with a young family to support. I don’t have a great education (didn’t have the resources to pay for it after high school) and I don’t have a great paying job. So chances are, I’m getting all kinds of subsidies from the government… or not (I might have moral standards that prevent me from applying for welfare).

 

Anyhow, I finally luck out. I get an offer for a decent job. However, the job is half an hour walk away. I’d drive, but I don’t have reliable transportation. I don’t have a bike either. So I’m going to hoof it.

 

Well, I’m doing this job for a couple of months and I finally have a little bit of money put away. It’s getting to be cold out so I consider buying a car. Why? Because I don’t want to spend a half an hour walking in the snow everyday (especially after work)! So, I get the least expensive car I can.

 

I’m doing pretty good, now. However, because I did pay for a cheaper car (with many miles already on it), I’m finding myself having to do repairs on said car. Well, crap. Now I got to pay for that!

 

Ok. Well, this rat race sucks. Maybe, I need to go to school and get a better job. Then I could get more income.

 

I start going and I’m doing fairly well, but it sure is tough having to balance work, school, and a family.

 

So I’m going and suddenly one of the kids gets sick. We don’t have the best insurance, so now I have to pay for that out of pocket. Oh and let’s not forget the car breaks down again.

 

Well crap. Now I have to figure out how to pay these two bills. I pick up a second job and now I’m finding it hard to study for school. Ugh… Ok. So do I struggle through the rest of the semester or quit and come back when I have the time for it again?

 

Hard decisions… hard decisions…

What would you do?


 

The previous story is actually the story of one of my past students who posed the question to me. They tried to play by the rules that society taught them. But due to lack of time and resources, they had a ton of issues. Luckily, this story had a happy ending… but many don’t. For most, it really isn’t as simple as pulling yourself up by your bootstraps.

 

The current economic system keeps them out not because they didn’t try but because they were told to do something that doesn’t cure what their symptoms are suggesting is their ailment. It would be like a doctor prescribing a hormone for acne treatment. It might work… or it might make the problem much worse.

 

What About the Middle Class?

 

This is currently where things stand for the rich and poor. And the middle class is stuck somewhere in the middle. With inflation and the cost of living going up, more and more people who once were considered stable middle class are finding themselves sinking lower and lower. How do the poor and middle class fix their situation?

 

By playing a different game. Two books that I’d recommend listening to (or actually reading) would be Robert Kiyosaki’s Rich Dad, Poor Dad and Robert’s book with Donald Trump Why We Want You To Be Rich.

 

In these books, you’ll learn mainly theory on how rich thinking is different than poor thinking. Ever since I read Rich Dad, Poor Dad in 2001, I’ve been looking for as much content that I can find that is applicable for people who need low overhead to start a business. (The results of that will be in another post.)

 

Formal Education is A Dinosaur

 

I grew up always kinda thinking that I was going to be a teacher of some sort. I always wanted to make an impact in other’s lives. In high school, I realized that it wasn’t going to be kids. A lot didn’t seem to take the information they received as vital information.

 

When I got to college, I thought “eh, this might work.”. So when I got the opportunity to finally teach, I realized it wasn’t going to be college students because of the administration.

 

I thought about this for awhile and with the help of a few videos and audios, I figured out that it wasn’t the kids in primary school. And it wasn’t really the administration’s fault in the secondary setting. It was the simple fact that the system itself is out of date!

 

The main part of this, I believe, is due to the Prussian Education System that our current education system is largely based off of. The main thing you need to know about the system is that it consists of a ton of a standardized testing AND one of the main results being that it creates a lot more followers than it does leaders.

 

With the internet completely giving everyone their own way to express their voice, the system is failing miserably. It just doesn’t fit today’s needs and culture. This is one reason I believe we’re seeing Millennials question early on whether or not college is worth going to. What’s the point if you don’t need it to do what you want to do?

 

The Choice is Yours

Again, I’d say that all Millennials are victims in one way or another. Whether or not you stay a victim is up to you. If you choose to stay one or think that you will forever stay one, then you’re probably right.

 

If you think that you’d like to get some wealth (not just money, but in relationships, health, etc.) into your life, then I know you have the ability to do so. I’m glad to be on that journey with you. We need more people like you involved with New Inceptions.

 

Below I’d like for those of you who would like to stop living paycheck to paycheck, quickly tell me why you’d like to get out and if you can, what you’ve done in the past to get out. If you haven’t tried before, I’m glad that you’re making the decision to now – welcome aboard!

 

In the next part of this series, we’ll be discussing Self Discovery. Personally, I think it’s one of the most important things you need to figure out to have success with not only business, but with life as well.

The Emperor of Books on Empire Road

Somewhere on a road in South Africa is a homeless man. This homeless man, is no beggar, however. Instead, he earns by adding value to those around him. How? By doing something that is so inherently simple but so removed from his current condition that it’s kinda out of this world.

Philani reviews books. Not only does he review the books, but he also reviews authors AND publishers as well. The guy is amazing. To have that kind of knowledge, you have to have to read a ton!

When asked why he doesn’t sell drugs, he says, “I hate what drugs can do to you. You continue on into a money making machine.”

Watch more about Philani below:

In a world where people are looking for the next handout, this should serve as motivation for them to add their voice to the world. This guy is homeless – but yet he has it figured out. He’s adding value to the world and I’d be surprised that he’s on the street that much longer. Comment below on how you are or could possibly add value to the world.