Don’t Let Saving Paralyze You

Saving is a crucial part of financial stability. However, it’s important to recognize instances where the fear of risking savings can lead to missed growth opportunities. Don’t let savings paralyze you from taking calculated risks through investment for a more secure future. 

Role of Investments:

• Savers often prefer the safety of savings accounts, but low-risk options may not always provide sufficient returns for long-term goals. Investments, such as stocks, bonds, and mutual funds, offer the potential for higher returns over time. I’d encourage you to acknowledge the role investing can play in creating increases in wealth. 

Risk Tolerance:

Investments can carry a degree of risk, but understanding and managing that risk in relation to your financial goals can lead to more confident decision-making. Consider your comfort level with market changes and invest accordingly. 

Retirement:

• Savers who aspire to retire comfortably need to recognize that relying solely on savings accounts may not be enough. Investments like 401(k)s, IRAs, and other retirement accounts provide avenues for long-term wealth growth. By strategically allocating funds to these investment vehicles, you can maximize your retirement savings potential.

Leaving A Legacy:

• Building wealth through investments can ensure that your legacy extends beyond your lifetime. Consider exploring investment options that align with your legacy goals, such as creating a trust or investing in assets that appreciate over time.

Savers, it's time to break free from the paralysis of saving and explore the world of strategic investing!. Remember, calculated risks are a vital part of financial growth, and by incorporating smart investments into your strategy, you can unlock new possibilities for a legacy that lasts! 

Top 5 Ways To Improve ROI

Everyone wants to receive a positive return on their investment. We are delaying the use of our money so that we can have more money in the future – at least that is the goal. However, many people are seeing negative ROI over the past several years. These are the five rules that can help you maximize your money!

1. Don’t invest for the short-term.

I am just not smart enough to make sense of every single nuance of the entire world. And sometimes seemingly unrelated items have a major impact on financial performance. For this reason, I spend a great deal of time thinking about which investments to choose before I acquire them, and then I hold them for the long term. Day-trading (or anything like it) has a feeling very comparable to gambling in Vegas, and it usually winds up with the same result.

2. Diversify Your Investments

Don’t think just about the stock market. I have personally invested about 50% of my money into publicly traded stocks and mutual funds, but my best returns on investment over the past ten years have occurred through private investments. When managed correctly, rental real estate is an excellent investment that provides an immediate return through rental payments and a long-term return through property value appreciation. Other alternative investments include starting a business, investing in another’s business, land, commercial real estate, and private bond offerings.

3. Maintain Substantial Margin In Cash

If I do not maintain liquidity, it becomes very difficult for me to maintain rules One and Two.  Without financial margin, I am more likely to be “jumpy” and leap out of investments when they trend downward.

Having substantial cash on hand also allows me to take advantage of tremendous opportunities – many of them may be “once-in-a-lifetime” opportunities that will require cash money right away.  If all of my money is tied up in investments (or all of my money is gone), then I am not able to take advantage of these great investments.

For me, it is helpful to keep 10-15% of my money in cash or cash equivalents.  I hold a lot of my savings in online FDIC-insured savings accounts that pay interest equivalent to a two-year CD, but do not have the liquidity issues that CDs have.  I really like Capital One 360 – it’s my favorite!

4. Conduct Trades Online

Brokerage commissions and fees can consume substantial portions of an investment’s return – especially when one accounts for the fact that the fees continue even when the market value drops.

I personally use Sharebuilder for my online trading platform, but all of the online trading platforms like Scottrade, E*Trade, and TDAmeritrade are great as well.  There are numerous ways to learn more about how to invest in stocks and bonds, and it is important to gain that knowledge.  However, once you are ready to roll with the actual transaction, the online route is much more economical and does not require a phone call and a reliance on a broker to execute the trade.

5. Invest In What You Know

I don’t invest in random items that I have “heard” are good investments because it will be extremely difficult or even impossible for me to know if things are going well or how certain news might impact that investment.  I like technology.  This means that I naturally follow what is happening in the technology market.  I’m a consumer of their products.  When I see a good solution or product, I know it because I am directly impacted by it.  That means I am a more informed investor when it comes to technology companies.  I love manufacturing, and I continue to watch and monitor what is going on in the world of manufacturing.  It also means I am an investor in it.

My dream of “helping people accomplish far more than they ever thought possible with their personal finances” has been the largest single investment I have ever made – because I BELIEVE IN IT and because I KNOW IT.

Mutual Funds: Explained

Mutual funds can certainly sound confusing – especially when there are so many options available.  So for those who do not know what a mutual fund is, let me explain it the best I know how.

If something has been FUNDED, it means that money has been given to it.

If you and I come to a MUTUAL agreement, it means that we both were involved in making the agreement.

So if you and I have MUTUALLY FUNDED a project, then it means that we both provided money for the project.

A MUTUAL FUND means that you and I have both put our money in the same place.  It is not unusual for a mutual fund to have over 5,000,000 people MUTUALLY FUNDING the same investment.

So we have mutually funded an investment along with three or four million of our closest friends.  The amount you have invested is different from how much I have invested, but it is all in the same place.

So, we now all understand that we have mutually funded this investment and that it is called a mutual fund.  The next question to answer is: “Where does the money go once it is in the mutual fund?”

Well, each mutual fund has a specific objective.  Some mutual funds have an objective to produce income.  Others have an objective to maximize the long-term growth of the invested money.  Still others may have an objective to invest only in international companies.  The bottom line is that each mutual fund has a specific objective or charter.

Based upon a mutual fund’s charter, the mutual fund managers will purchase part-ownership in a lot of companies.

The Mutual Fund managers use the money provided by you, me, and three million of our closest friends to purchase ownership in anywhere from 50 to over 1,000 companies.  As these companies earn profits and grow, the value of the investment grows.  This means that each individual who owns a portion of the mutual fund can enjoy that growth as well.

I hope this post has helped understand exactly what a mutual fund is. Let me know below if you have any additional questions about mutual funds.

3 Reasons Why It Is Important To Set Investment Goals

You set goals for your budget, for eliminating debt, even for amount of dollars saved…but are you setting investment goals? These goals can help you achieve your Fully Funded Life!

3 reasons why you should set investment goals:

1. Goals help you create clarity and focus:

   • Defining Your Objectives: Investment goals allow you to clearly articulate what you want to achieve. Whether it's saving for retirement, creating ‘x’ amount of passive income, or leaving a legacy, your goals give purpose to your investments.

2. Goals provide motivation and discipline:

   • Maintaining Commitment: Knowing exactly what you're working towards can provide a daily dose of motivation. Your goals serve as a reminder of why you're investing in the first place, and they can help you stay committed even during market uncertainty.

3. Goals give you the ability to measure your progress:

   • Tracking Your Success: Regularly reviewing your investment performance against your goals enables you to gauge how well you're doing. Are you on track to meet your objectives? If not, you can make adjustments and adapt your investment as you move forward.

Setting investment goals is not just a good financial practice; it's a fundamental step toward achieving your fully funded life.

Remember, investing is a marathon, not a sprint, and the goals you set today can pave the way for you to accomplish your plans, hopes, and dreams. So, take the time to define your investment objectives, and stay focused on them, your future self will thank you for it.

Money Lies: I Can't Save & Invest

Have you been telling yourself this lie? “I can’t save money and invest.” That is a LIE!

This lie keeps people broke for their entire lives. When we are young, we believe we have forever to prepare for retirement. After all, young people and young families need to provide for their household, their children, and are just starting out in life. There never seems to be enough money to put away for a rainy day or for the future.

If you tell yourself this money lie, there never will be enough money to save or invest. If this is you, TODAY is the day you stop believing the lie and begin funding the future!

Here are some practical steps you can take to explode your financial future:

1. Understand compound interest.  Compound interest is what will allow an investment of $100 per month to reach $1,176,477 in just 40 years! If you just save a little ALL of the time, you will end up with a LOT at the end of your time! Use our “Investment Value Calculator” to see how much you could save!

2. Take advantage of retirement plan matching.  If you work for another company or organization, there’s a good chance your retirement plan contributions are eligible for matching contributions from your employer. Whether it is a $0.50 per $1.00 match or a full “dollar for dollar” match, it is FREE money! Visit your Human Resources Department TODAY to ensure you are receiving the full company match.

3. Make saving and investing MONTHLY (at least) and AUTOMATIC.  If you have to rely on yourself to write a check each month, your savings plan could be in great danger! Make it automatic – have it deducted from your paycheck before you ever receive it or have it zapped out of your bank account at a predetermined date each month.

You will be on your way to becoming a wealthy individual who will be able to live a life of generosity like you’ve never dreamed!

What Are Oxen?

Where there are no oxen, the manger is empty, but from the strength of an ox comes an abundant harvest. Proverbs 14:4

This verse had a profound impact on me as I went through my financial freedom journey. From this verse, I realized that I could either live a life with an empty manger or with an abundant harvest and the choice was up to me. In the pursuit of financial abundance, I could choose to rely on myself and my own abilities, or I could acquire oxen to help me. Which do you think I chose?

In my book, Oxen, I have outlined the different types of oxen, how to acquire oxen, and how to lead oxen. These principles will help you maximize your financial resources and experience an abundant harvest, just as I did so that you can fund your biggest and wildest dreams.

Most people earn money by showing up to work and in turn, they get paid. If you do not show up to work, you do not get paid. Oxen can allow you to earn money whether you are working or not! There is only so much time in a day and therefore there is only so much work that one person can physically put in. This is why oxen are so important: they allow you to eliminate the time barrier.

Oxen can do things you cannot do. They have the ability to carry a load that you cannot carry and can endure more than you can endure. Oxen can be trained and can work together and accomplish even more. They work rain or shine, night and day so that you do not have to. They can multiply and take you places you may have only dreamed about. Oxen can provide.

Furthering Your Financial Education

Have you ever found yourself feeling stuck when it comes to your finances? Could it be because you haven't had the chance to dive into the right knowledge or education about personal finance?

Like any subject, we don’t know every answer to our financial questions. We can’t. That’s why it’s so important to continually strengthen yourself in the areas of personal finance. Just think for a moment: you might have a strong budgeting habit, but are you confident in your savings plan?

Here's the good news – you're not alone! Many of us have asked similar questions or faced challenges due to a lack of knowledge.

So, how can you find ways to consistently educate yourself?

• Educational Blogs

• Financial Community

• Helpful Tools

Another way to take the next step in leveling up your financial knowledge? Complete a personal finance study!

With foundational truth from scripture, learn how to budget, save, invest, plan ahead, and maintain momentum on your financial journey. The I Was Broke. Now I’m Not study blends scripture and money in a relevant, engaging, and life-changing way for you!

Let's Talk: Compound Interest

Few concepts are as magical as compound interest. It has the ability to turn small, regular contributions into substantial wealth over time.

INVEST and capture the power of COMPOUND INTEREST.

When it comes to compound interest, three things matter a lot:

1. Amount of money invested (start with whatever you can and work to increase it from there)

2. Time (start early!)

3. Interest rate (growth rate of your investment)

Here’s how YOU can achieve $1,000,000 at a constant Interest Rate of 12%:

1. Invest $85.00 per month for 40 years at 12% annual interest.

2. Invest $286.13 per month for 30 years at 12% annual interest.

3. Invest $1,010.86 per month for 20 years at 12% annual interest.

4. Invest $4,347.09 per month for 10 years at 12% annual interest.

Here are some ways YOU can achieve $1,000,000 in just 20 years:

1. Invest $1,697.73 per month for 20 years at 8% annual interest.

2. Invest $1,316.88 per month for 20 years at 10% annual interest.

3. Invest $1,010.86 per month for 20 years at 12% annual interest.

4. Invest $768.54 per month for 20 years at 14% annual interest.

Here is how YOU can achieve $1,000,000 with just $300 per month:

1. Invest $300.00 per month for 473 months at 8% annual interest.

2. Invest $300.00 per month for 404 months at 10% annual interest.

3. Invest $300.00 per month for 355 months at 12% annual interest

4. Invest $300.00 per month for 318 months at 14% annual interest.

For those familiar with investing, I already know one of the biggest questions you want to ask:

“Where on earth do I get 12% annual interest?”

It’s a great question! The number one way to get 50% or even 100% interest is to contribute to an employer-sponsored retirement plan where matching contributions are made. For example, if your employer matches your contributions “dollar-for-dollar” up to 3% of your pay, that is a 100% interest rate that AUTOMATICALLY HAPPENS with NO RISK! It’s called FREE MONEY! Beyond that, I like investing in mutual funds that are older than me. Also, in other great investments like residential or commercial real estate and small businesses.

Got Oxen?

Where there are no oxen, the manger is empty, but from the strength of an ox comes an abundant harvest.

Proverbs 14:4 (NIV:1984)

I will never forget the day I first read Proverbs 14:4 in my Bible. My family had embarked on a journey to become financially free, and I was reading the entire book of Proverbs to find verses providing wisdom about money and money management. Many verses in Proverbs were already well-known to me and had made a profound impact on my life. But, Proverbs 14:4 never registered on my radar until that day. Its wisdom gripped me and stopped me in my tracks. “Where there are no oxen, the manger is empty, but from the strength of an ox comes an abundant harvest.”

I grew up on a small farm. We raised or grew just about anything and everything. We had pigs, cows, ducks, and chickens. Our crops included corn, soybeans, wheat, and hay. I loved growing up on a farm. It is where I learned the value of hard work, about sowing and reaping, the cycle of life, and how everything in God’s creation is interconnected and dependent upon each other.

Maybe Proverbs 14:4 connected with me so strongly because it was talking about a life I knew that included farm animals, farm equipment, and a harvest, but I think the real reason it connected with me is because it described my financial situation – my manger was empty.

I don’t know if you have ever watched cattle eat from their mangers, but they will stand eating at a manger until all of the food is gone, and then they will lick the manger clean just to ensure all remaining scraps are consumed. This described my financial situation. I could scrape together enough money to pay the bills, but beyond that, there was absolutely nothing left over. Every single spare dime we gained inevitably departed our presence – never to be seen again. Our version of “licking the manger” was running out of money and then physically turning our piggy bank over to find enough coins to buy food off the dollar menu.

The same scenario played out every single month. We made money, and then we consumed every last dollar. Just like the oxen, we would be faced with an empty manger and were forced to stand around waiting for the next paycheck to refill it. It seemed like there was never enough for the moment, let alone storing up for the future.

On the day I encountered Proverbs 14:4, I realized that the writer shares two potential outcomes: an “empty manger” and an “abundant harvest”.

Two Potential Outcomes – Proverbs 14:4

1. An empty manger

2. An abundant harvest

An empty manger is barren. It represents hunger and potential famine. The manger once held food, but now it is cleaned out. It has nothing left over. To more fully comprehend this, imagine that your entire house is void of food – the pantry, cupboards, and refrigerator are completely empty.

An abundant harvest is presented as an alternative outcome. I liked the sound of this much better than an empty manger. An abundant harvest suggests that we have a full manger – all of the time. Dictionary.com defines “abundant” as “present in great quantity; more than adequate; over-sufficient.”

As I pondered these two potential outcomes. I sensed a life-changing moment approaching. I knew if I could truly grasp the wisdom contained within this verse, my life would be radically changed. As I read Proverbs 14:4 again, I saw what made the difference between an empty manger and an abundant harvest: oxen.

A farmer knows it is impossible to reap an abundant harvest without oxen. The same is true for all of us even if we aren’t farmers.

If I continued managing my money without the help of financial oxen, the opportunity for an abundant harvest would be greatly limited. After all, there was only so much I could accomplish on my own. Like most people, I was working a “Work, get paid. Don’t work, don’t get paid.” job. Even if I worked twelve hours every day, there was a limit to how much I could earn on my own. My earnings would allow me to feed my family, but without a serious change to the way we managed our money, the income would probably only be enough to maintain our household. We would continue to be stuck in the “empty manger” cycle, cleaning out the manger each month and then standing around waiting for the next paycheck to arrive. The worst realization of all was knowing that even if I worked for fifty years of my life, my income would cease the moment I chose to retire. It became imminently clear that I needed oxen in order for my family to experience abundance.

There is a choice each person must make. In pursuit of financial abundance, you can choose to rely on yourself and your own abilities, or you can acquire oxen to help you. Don’t miss my wording here. It is a choice, whether a conscious one or not, that each one of us will make as we journey through life.

I have chosen to acquire oxen, and have found Proverbs 14:4 to be absolutely true. While my family’s oxen acquisition journey has been adventurous, frightening, incredible, and exciting, I have discovered that the strength of oxen has indeed led to an abundant harvest. The same can be true for you. All you need is some good oxen.

Now I have one question for you:

Got Oxen?