The Money Answer Book

I posted earlier about Dave Ramsey's Total Money Makeover... and here is yet another gem from this money-guru: the Money Answer Book.

It's small, it's concise. It answers all of the important questions about everyday finances. Of course a lot of it has been said before but the format of this book makes it a super quick and easy read for those that may be intimidated (or just lack the time/focus) of reading one of the thicker books in his collection.






I'll go ahead and share two of my own personal take-aways (yeah, stuff I've already known but am actually focusing on during this point in my life):

Take Away One: Buy Used Vehicles with CASH

"Americans have a 'love-fest' going on with their cars. Where else can you find people flat broke, living paycheck to paycheck, with two vehicles in their driveway less than two years old?

The average monthly car payment is $378. If you only have one car payment you're shelling out almost $5,000 in one year. Investing $378 per month in a good growth stock mutual fund from age 25 to 65 will be worth more than 4.4 million!! A one-time investment of $25,000, leaving it sitting for 30 years (same terms) would net you more than $495,000. Hope you like your SUV!!"

Advice: Buy a car 2-3 years old with CASH instead of financing a new vehicle. Ramsey stresses the point that cars loose most of their value in the first two years so only the SUPER RICH should buy new cars.

I grew up thinking only new cars were good because I never knew much about maintenance or cars in general but my car is 5 years old now (it was paid off early) and it's still runs like new! I figure if I can keep a car like-new than other more car-knowledgeable folks must have amazing 1-2 year old cars! Plus thousands of leased-cars are turned in each year often with very low mileage and in superb condition.

Action Plan: I really do plan on driving my current paid-off trustworthy Honda for as long as I can (hopefully another 5 years!?) but in the meantime I'm going to build up that cash-for-car fund so when the time DOES come that it needs some TLC and/or I need to throw in the towel and purchase another ... then I can pay cash for something pre-owned.


Take Away Two: Invest in ROTH IRAs


"Because the Roth IRA growth is tax-free, you'll get to keep all the money in your Roth IRA"

Of course, the benefits of Traditional IRAs vs ROTH IRAs may be different for individuals (for example if you are not self-employed and your employer matches your investment aka Free Money... it may be worth investing in the company IRA before the ROTH).... but in the case for most of us investing in a ROTH IRA is a win-win because it's likely we're going to be in a higher tax bracket as we get older and closer to withdrawal time it would be beneficial to pay taxes up-front instead of on a huge lump-sum later.

The great thing is the government is increasing the amount we're allowed to invest each year so in 2008 we can put up to $5,000 in a ROTH IRA as long as we've made at least that much income. You can even get someone a ROTH IRA as a gift... that could eventually grow to hundreds of thousands of dollars if they leave the $ in there! Now THAT is the gift that keeps on giving!!

Action Plan: Finish rainy-day emergency fund then fully-fund a ROTH-IRA this year and every year following at the maximum amount. Research and think about gifting ROTH-IRAs vs giving gifts that depreciate and do not hold value :)



Well... there's MUCH much more in this little book packed with straight-forward $ advice.... so pick up a copy for yourself and pass it around when you're done!

Total Money Makeover

2008 has been an AWESOME year of good reads so far for me ... and here's another one that's going on my Recommended Reads list for sure!!

Many of you already know my story about how I was over 20k in debt and making 22k in salary right out of college... and how I turned that around by applying financial smarts to my life and business. There have been some great resources that helped me through all that... but here's one I REALLY could have used back then. Mainly because it is SOOO completely practical and has actual steps and numbers to go along with it... and lots of encouraging stories of others who have changed their financial worlds around too!

If I hadn't buckled down and learned about Running My Biz based on the Numbers, and being smart with my personal finances too I know I'd be in a completely different place today. Now my car is paid off, I have absolutely no credit card or school debt, and I've moved into a brand new home years and years before I thought I'd be able to. I've got a rainy-day fund so if business is slow, it's A-okay... and I've got a retirement fund, savings, and can give to causes I believe in. Oh, and did I mention I'm doing what I LOVE to do and not running the rat-race?? Live changes considerably when you're not worried about finances!

This one is a MUST read for everyone! Click the picture below to order.




Description:
The success stories speak for themselves in this book from money maestro Dave Ramsey. Instead of promising the normal dose of quick fixes, Ramsey offers a bold, no-nonsense approach to money matters, providing not only the how-to but also a grounded and uplifting hope for getting out of debt and achieving total financial health.

Ramsey debunks the many myths of money (exposing the dangers of cash advance, rent-to-own, debt consolidation) and attacks the illusions and downright deceptions of the American dream, which encourages nothing but overspending and massive amounts of debt. "Don't even consider keeping up with the Joneses," Ramsey declares in his typically candid style. "They're broke!"

The Momentum Theorem

While attending to some of the many errands I have to accomplish before I leave for Spain in a week, I minimized my driving-in-Atlanta-traffic-boredom-and-stress by listening to some pre-recorded CDs including one called the "Momentum Theorem" from when Dave Ramsey came to visit last Spring.

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Here's an excerpt from this article that explains exactly what the Momentum Theorem is:

"Isn't it funny how most people work their tail ends off for years only to be labeled an "overnight success"? Right now, our team is experiencing growth like never before! But this isn't how it's always been. We've paid an unbelievable price to get this momentum. We've put in the time, the money, the heartache, the sweat, and everything else we had left. And then, everything took off. But it sure didn't occur overnight.

One thing my team and I have learned over the years is that this type of unstoppable momentum doesn't just happen. Momentum has to be created. There is a process to go through before momentum can result. It takes focused intensity, over time, multiplied by God, to equal unstoppable momentum.

( Fi / T ) x G = UNSTOPPABLE MOMENTUM

Focus? Really? In a society where everyone "should be" on Ritalin? Focus? In a time when my teenagers can have five IM screens open while checking their e-mail, talking on the phone, keeping up with VH1, and doing the homework that gets them on the Honor Roll? We live in a world of true multi-taskers and I'm asking for focus! "

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You can access the whole talk for free HERE (5/6/07 called "Momentum").

This REALLY hit home and reinforced that I need to keep taking it ONE STEP AT A TIME -- persevere in what we're doing in business and life. I think we all go through cycles where things are exciting, new, and fun -- and a time when things balance out a bit and get to be routine. For us creative folks, the routine tends to get mundane (and that's where I'm tempted to "check out"). Then there's the freak-a-zoids like me that like to think up the ideas a LOT more than they like the execution part. In fact, most of the time the actually-doing-it part is a big feat.

In the past three years, God has opened a LOT of doors for me in areas that I'd been working on faithfully for years and years. After six years in this business, and twelve working in small business, I was a so-called "overnight success" as a destination wedding photographer according to magazines like PPA and such. I certainly do not feel that statement is warranted but heard it enough to know it was a common perception. People talked... gossiped... questioned.

Here's the thing though... there's no way for them to see all the blood, sweat, tears, and focus that goes before the "overnight" part. Do they know about the 4-hours-of-sleep-per-night for six years plus, or the working numerous jobs part, or the studying for three-degrees-at-a-time part, and bar tending before I could make enough in photography part? How about the 20,000k in credit card debt part? Then the smartening up and paying it off part? I look at the hottest people in different industries now and have a little flutter inside when they claim "it's so easy!" "it can happen overnight". Because, truth be told, it may seem to happen overnight... but true momentum only happens with focused intensity and TIME.

So a note of encouragement to all the photo-biz people I've been honored to spend time with this past year... keep on doing what you're doing... feeling uncomfortable... taking it ONE step at a Time... even if it becomes routine... because then you know "time" is taking it's turn in the equation ;)

What will you be focused on during your lifetime???

Breakfast with Rudy Giuliani

Archive: Originally published May 18, 2006

This morning I had the awesome opportunity to join a bunch of other Atlanta area business people at the AJC's 100 Best Georgia Companies Awards Breakfast with former NYC Mayor Rudy Giuliani.

We had killer seats right up front and it wasn't until 15 minutes into breakfast that I realized Giuliani was parked at the table diagonal from ours. He talked with us for about an hour about six qualities that strong leaders all have in common. It was interesting because just before he went on, they had a panel of 5 CEOs from the top-ranked Georgia companies for this year answer the question of "what is the most important quality a CEO must have to lead their organization successfully."





I would love to go in depth about "Rudy's Six" but fear that time is not on my side today so here they are:
1. Strong Beliefs (devote time to thinking and making goals)
2. Optimistic - focus on solutions and remain calm and positive
3. Courage - does not mean a lack of fear, it means recognizing fear and overcoming it. We MUST be willing to take risks.
4. Relentless Preparation - If you prepare for everything you can think of, when the unexpected happens you will still be prepared because it will be a variation of your practiced scenarios. He used specific examples from 9/11 how they had not planned for a disaster of that magnitude, but all the other plans (like triage and evacuation procedures) allowed them to move forward.
5. Teamwork - A leader asks themselves 'what are my weaknesses and how do I balance them with strengths of others.'
6. Communicator - A leader is able to communicate all of the above. i.e. A coach of a football team does not do a thing on the field but is a teacher and a motivator and leads the team to victory because they can communicate effectively with the team.

In the end, Rudy says: "You can do all of these things but none of it matters unless you CARE about people. Organizations are comprised of people. People with emotions, personal lives... you can not ignore these things. If you are successful in this area, you and your organization will be successful too."

If you ever get a chance to hear Rudy in person - go! - He's a phenomenal speaker and quite the comedian too!