Meeting mortgage broker next week to sign docs for refinancing of home loan.

Had some misgivings after we gave him the green light to go ahead with loan application. After all the reading we've done, realized we (still) didn't really understand x-collateralization, line of credit vs offset vs redraw, standalone loans, implications of mixing personal funds with investment funds...

In the midst of getting a second opinion from a mortgage broker who is himself a property investor.

On the home front, bro-in-law and real estate agent called today to say they were at HDB for the first appointment. As our sale is a 'negative sales proceeds' transaction, we have to refund the $5k downpayment and deposit to HDB. Am getting BIL to pay first and we'll ETF him the money.

Buyers have asked to have the flat early to begin renovation. The agent has advised that we say yes subject to buyers assume responsibility for anything that might go wrong before settlement, and also get their contractors to clear any belongings still there that they don't want.

It's great to have a professional and ethical RE agent on our side for a change!

What is Money? (extract from Business Lyceum e-Letter by (J.F.) Jim Straw

What is MONEY?

MONEY IS ONLY A MEDIUM OF EXCHANGE. -- That simply means that ANYTHING that can be exchanged for something else is MONEY.

Until you finally learn and accept the fact that ANYTHING (and I do mean anything) you can exchange for SOMETHING ELSE is money, you will be doomed to a life-long futile search for something you already have.

Now ... let me tell you a true story about George. He "borrowed" a whole factory.

George is a real person, but, since his company is still in business and I'm sure he wouldn't want a bunch of crazy telephone calls interrupting his business days, I have not given you his last name or where his company is located. I've also used "generic" terms to describe his business; rather than the specific product lines, just in case you're in the same kind of business and might recognize him from clues in his story.

When I first met George, he was a successful manufacturer of an industrial product. -- That's a product that is sold to other manufacturers who use it to manufacture other products.

One day, in my office, over a cup of coffee, we were swapping war stories about our various business activities. After telling George how I had started my business, he told me how he had "borrowed" a whole factory to start his business.

Before he was a manufacturer, George was a salesman; selling the same industrial product he later started manufacturing. He was a pretty good salesman and made enough to support his wife and 7 children comfortably but not lavishly.

George had always dreamed of owning his own factory. He had approached a number of lenders, but had always been turned-down. The money he thought he needed was just too much for his provable limits.

By the way, one of the reasons George was a successful salesman was because he was (and is) a meticulous record keeper. He made it his personal responsibility to take exceptional care of his customers. And, his customers knew they could depend on him because he had proven it over and over again in their dealings.

When George celebrated his 40th birthday, he started considering where he had been, where he was, and where he wanted to be. If he was going to make his dream come true and own a factory of his own, he had better get moving, or he would be too old to enjoy it later.

Taking a look over all of the packages and proposals he had prepared for various lenders over the years, George made a list of all the things he thought he needed to get his factory going. After he had that list, he went through it again and again. Each time, he eliminated more and more of the nice-to-have items, until he had a bare-bones list of only the most necessary items. That list included:

1) Incorporation of the business.

2) A building to work from.

3) Office equipment & supplies.

4) Manufacturing machinery.

5) Employees.

6) Raw materials & supplies.

7) Operating cash.

Everything on his list could be had with "cash," but George didn't have, and couldn't get, that kind of cash. So, he "borrowed" all of it, one piece at a time, until he had all of it.

To get started, George felt he had to, first, incorporate a business.

Since George didn't have cash for the attorney fees, filing fees, etc., he talked to a friend of his who was an attorney. After George explained that he was going to manufacture the same product he had been selling for about 20 years, the attorney prepared the corporate charter, paid the filing fees himself, and agreed to act as Secretary of the corporation for ten thousand shares of the company stock (out of 1,000,000 authorized shares). After all, he knew George could sell the product and make a profit, if he could manufacture it.

George's proven skill of selling the product had gotten him one item on his list. -- Only 6 more to go.

Down the road from George's home, there was an old run-down mill building. It had a railroad siding, loading docks, and even a set of old truck scales, but it was really in a sorry state of disrepair.

George had driven past that old building thousands of times. He really hadn't noticed it until he started looking for a building for his factory. The only real reason he noticed it even then was because, after pricing buildings for rent or purchase, he had all but given up on finding a building he could afford.

The owner of the building lived in a house on the other end of the property. The old building had been there when he bought the property, about 10 years before. He had meant to do something with the building, or tear it down, but he just never got around to it.

After a number of conversations, the owner agreed to let George use the building for a period of 2 years, rent-free. During that time, George would repair the building, make it usable & presentable, and clean up all the debris that had accumulated around the building. At the end of 2 years, George would either vacate the building leaving all of the improvements, or he would enter into a rental agreement with the owner at $1,500 per month for the next 3 years.

George had his building -- but -- it was far from being serviceable.

Working nights and weekends, with help from his wife & children, George managed to get the building cleaned-up; inside & out. At work, during the day, he enlisted the help of other salesmen. At church, on Sundays, he enlisted the help of his friends.

As time went by, more and more of his friends helped-out with the painting, wiring, plumbing, and general fix-up of the building. And, a friend of a friend, who worked for the telephone company, even put in an extension of George's house telephone; since it was less than a half mile from George's home. -- The old building took on a new life; to the amazement of the property owner.

While George and his friends were working on the building, his brother-in-law closed a small branch office of his Insurance Brokerage. Since his brother-in-law didn't have a place to "store" the excess office furnishings, George told him about the factory. -- George borrowed the office furnishings, including an almost-new typewriter.

George was well on his way. He had his business structure, building and office, but an empty factory doesn't produce much products.

Because George had worked in the industry for a good many years, he knew most of the manufacturers. So he knew that two of the manufacturers had replaced some older, out-dated equipment with brand-new equipment over the past two years. -- Maybe one of them would have some used equipment he could get.

Talking to the two manufacturers, George discovered that between the two, they had enough old equipment to set-up one full production line. Although neither of them would agree to let George just "use" the equipment, they both agreed to allow him a one-year option to purchase. -- George would move the equipment to his location and at anytime during the year, he could pay for the equipment or arrange financing. If George did not buy the equipment within one-year, he would be required to reimburse the companies for the use of the equipment at a set rate per month on each piece of machinery, and pay all cost involved in returning the machinery (if he didn't have someone else to buy it).

Actually, the manufacturers were so glad to get the machinery out of their buildings, they used their own labor and trucks to deliver the machinery to George at his building.

It's one thing to have machinery, but yet another to operate it. Especially when you don't have any cash money to cover payrolls for employees.

Talking to some of the machine operators at the other factories, George made a deal with 3 of them to run his machines for him in the evenings and on weekends. And, since he didn't have any cash money to pay them salaries, he made an agreement with them to pay them a percentage of each order produced and shipped. This way, they would get their pay as soon as George was paid for the products they produced.

After he had his machinery installed and ready to operate, and had his signed agreements with his part-time employees, George went after the Raw Materials and supplies he would need to manufacture his product.

By showing the suppliers of the Raw Materials and Supplies through his factory, George was able to get them to agree to ship their materials and supplies on a 90-day billing. That meant he would have 90-days to pay for those materials after the materials were delivered. But, George could only get the materials he would need to fill each order. Therefore, he would have to show the suppliers confirmable Purchase Orders before they would ship the goods.

George quit his job and went on the road selling the same products he had been selling for years -- but -- this time, he was selling for his own company.

As George got Purchase Orders from the buyers, he took them to the Raw Materials Suppliers so they could be confirmed. -- The raw materials and supplies were shipped on the agreed-upon 90-day billings.

When the raw materials and supplies were delivered, George notified his part-time employees. They produced the product and shipped it to the buyers.

Even though George invoiced his customers on a net 30-days basis, there was a time lag between billing the customer and receiving payment. During that time lag, some things that George couldn't borrow had to be paid for with cash money. Such things as electricity and gas were increasing in direct relation to the amount of manufacturing being done. And, the freight lines that delivered the product to George's customers required cash payment or George's product wouldn't be delivered.

To get the cash money he needed to cover operating costs, George ran a classified ad in his local newspaper; something like this:

PRIVATE INVESTORS WANTED for going manufacturing concern with orders in hand and production scheduled. Call George at 555-1111.

Although the response to the ad wasn't very big, George showed each of those who responded his new factory, the purchase orders he had in hand, and delivery slips & invoices on the product already manufactured and shipped. George sold enough of them some of his stock at $1 per share to cover his cash operating cost until the cash started coming in from the billings already made.

George had "borrowed" a whole factory.

When you finally accept the fact that money is ANYTHING you can exchange for SOMETHING ELSE, you may be able to do even greater things than George did. All you have to do is break your desires down into their basic component parts. Then acquire each of those component parts using someone else's money in whatever form it may take.

Of course, you should ONLY use someone else's money for things you really need. Beyond that, you must always remember that when you do use someone else's money, you take on a responsibility far beyond any you would bear using your own money. If you mis-use someone else's money, you will pay penalties that could be disastrous to your financial position for many years to come. And, it doesn't matter whether the money you use is "cash" or something else of a tradable value.

Believe it or not, I have just revealed to you some of the most powerful tricks, techniques and methods used in the world of business and finance. - Tricks I have used over and over myself to build my own fortune. - The beauty of those methods is that anyone can begin using them immediately to achieve financial independence. But, I'm not going to itemize and annotate them for you.

If I were to itemize and annotate the various and many tricks, techniques and methods, you would simply nod your head and never use the information. But, if you really want that knowledge, you'll read and re-read this report until the knowledge you seek strikes you like a bolt of summer lightning.

Anyone can get all of the money they need; someone else's money, when they finally learn what money really is.

The fine print I missed

Hubby and I are on a $29 Cap plan with '3' for our mobile phones.

My conversation with iPrimus customer service yesterday inspired me to take a closer look at our latest bill.

I'm trying to see if there's any way to cut down the monthly cost.

And here's what I discovered: the plan requires a minimum spend of $29 per person per month. If you spend more than that, they credit you the difference (you get rewarded). If you spend less than that, you get charged (penalized!).

Not only that, our plan actually has a $150 cap limit that includes $100 of international calls.

Which we've never used.

We've always just bought a $10 ICC and used it up till it expired, if we didn't remember to recharge it before.

Hubby spent only $10 last month and was charged $18 for breaching the minimum cap requirement.

I spent $34 and received a $5 credit that brought me back down to $29, so I actually benefitted.

Two options going forward - either use hubby's mobile to make international calls to SG to get up to the $29 cap, or ask '3' how we can downgrade hubby's plan.

We've had the plan for more than a year and this is the FIRST time I've actually bothered to scrutinize the plan.

All we've ever focused on is paying the bill on time (and this goes for all our other bills).

Until now.

Simple Savings

Yesterday was one of those productive days where I got down to ticking off things I'd been putting off for ages.

First thing in the morning, I rang the lady who runs the Kumon Centre in HX. I had left her a message on Monday but hadn't heard from her. I normally don't follow up on calls; I hate talking to answering machines and I try not to call someone if I can because I just can't handle the interaction. But for some reason, I thought I'd try and see if I could get through to her.

And she picked up!

The result was we had a very friendly and informative (for me) chat and I had most of my questions answered. We are booked in for a parent info session on Monday and Beth will sit a diagnostic test to see where she's at with her math. [Math ability is generally poor in Aus and I'm hoping Kumon can help Beth get an edge as she gets older.]

The next thing I did was to compare energy supply rates using GoSwitch and SwitchWise. I finally went with the supplier and plan that will save us $269 a year on a Loyalty Saver plan (the same retailer has an Easy Saver plan that would save us $270, but requires us to lock in a contract for 2 years, and I wasn't sure I wanted to do that).

The retailer is supposed to call me to confirm details.

Finally, I filled out an inquiry form on iPrimus, our broadband and home phone service provider (another way of avoiding direct contact!). I wanted to ask about their VOIP Lingo service.

The customer service officer called me back within the day, talked me through the options, answered all my questions, and after analyzing our monthly spend, actually advised me to downgrade to a cheaper plan so we could save money.

Instead of the $87+ we currently pay, we are switching to a plan that costs $59.95 with no change to our home phone or broadband usage, and with line rental included. So we get to enjoy a savings of $27+ every month. And it cost us nothing, just a couple of minutes on the phone.
Wow.

That's not all. The same guy suggested we look at the SIM Saver mobile phone plan that would allow us to retain our numbers while spending less on phone calls and texts.

It was a bit of info overload at that point, so I said I would look into it at a later time.

In all, we're looking at saving potentially $593 pa. Awesome.

The only thing that tops that is going through my insurance policies and writing up a table for my financial planner so he could review them and advise on the best strategy for the future.

I ended up writing three letters to my respective insurers asking questions and informing them (in some cases) that I wanted to surrender the policies. That should free up some cashflow to be redirected to where they are most needed.

Taking charge of where our money is going is so empowering!

Faith in action

A follow up on earlier post about Faith vs. Action.

Have emailed Good News Lutheran to request a school tour. Received an acknowledgement email yesterday and hope to hear from them soon. After that we'll have a chat with the principal and hopefully get all our questions answered so we can submit the enrolment form.

Have been dropping hints to Beth that she may be transferring out of Heathdale in two years' time so it won't be such a massive shock when it happens. I know she'll grieve over the separation from her friends and her comfort zone, but kids are resilient, and we've tried to highlight the positives: the $ saved could go towards holidays (RACV Royal Pines is still high on her list of favourites).

Other ways I can think of to cushion the blow: regular play dates with her Heathdale friends, Good News Gang on Wed (which is attended by GNL and Heathdale kids).

Last night, I finally got round to reading up on the ASG terms and conditions to get a grip on what we signed up to when we enrolled the girls in '07. More importantly, I needed to know how we would benefit and when.

The good news: when Beth turns 13 (Year 7), ASG will send us the amount of projected benefit ($4k+). The amount goes up every year until Year 12. Then when she starts uni, she is entitled to a scholarship benefit of $1k - 2k for 3 years. Same for Jordanne, except her benefits are more because she enrolled at a younger age.

It's good to know we'll get some help with school fees (esp if Beth's still in a private school and not at Suzanne Cory or on a scholarship to Westbourne Grammar, which is our best-case scenario) five years from now. Which means the years of financial stretch are actually just Years 4, 5 and 6 (2012 - 2014).

Still, at $6k pa for 3 years ($18k), that's still a huge outlay compared to GNL's $2700 x 3 years ($8100).

Imagine how much more good we could do and how much more we could give for God's kingdom with the savings.

Why should a good Christian education have to be prohibitively expensive?

Doing nothing with my law degree?

Took Beth along to visit with an artist friend today.

She was impressed by the studio at the back, by our friend's numerous paintings which made her home a veritable art gallery, and by her treasure trove of Little Red Riding Hood stories.

I was touched by the stories behind how the paintings came to be.

Towards the end of our visit, our friend asked what were my career plans. Had I, for instance, considered what was required for me to become a solicitor or legal assistant?

This was rather confronting for me, as I had just had to articulate and defend myself on the same subject last evening at the church's newcomers' tea. One of our pastor's break-the-ice activities was for each person to talk about our past and current careers.

It is not that I have nothing to say on the subject. It is just that doing it exposes me once more to my fears, insecurities, self-doubt and lack of confidence. I feel the enormous weight of my law degree and eleven years of work experience and how it must (might) look to outsiders who for various reasons may conclude that I should/should not return to fulltime work.

It is not that I stand on one side or the other of the SAHM fence. I struggle all the time with self-identity and financial concerns. Who am I when I'm not being a mother and wife? Is this all I can do with my talent, time and skills?

If only there was money to be made every time I write an article or blog post or tell someone about the organic products I use, my life would be perfect.

"All the things I could do/If I had a little money/It's a rich man's world"

The reality is that whether I choose coaching or writing or the law, it's all about high-touch marketing, putting yourself out there, being visible and making an impact.

None of which I'm good at.

Money Money Money

Just arranged ETF for school fees and council rates.

Tomorrow is deduction for ASG and home and contents insurance.

Gas deduction is next Wed.

Payday is next Thu.

Had to redraw from home loan AGAIN.

Can't wait for 2011 when J will stop going to daycare and we can put the savings ($230 a month) back into the mortgage.

The Simple Savings Challenge

Beth and I looked through the Simple Savings website last night.

It was fascinating to watch her scroll through the tip sheets and actually take in the info.

I think I know what I want for my 40th: a subscription to the Vault! It costs $47 and gives you access to ALL the tips suggested by readers over the years.

I'm getting excited thinking of all the $ that I can save if I just start implementing some of the tips. Maybe I won't have to go back to work at all!

I've been resisting buying things that I just happen to see at the supermarket, and to make do with what I have in the freezer/pantry/fridge. Yesterday, I spent just $28 on meat and nuts at Tasman Meats, our supply for the week. Hubby loves the cashew nuts, yay. For dinner last night I made chicken soup using one of the chicken carcasses (3 for $1), plus carrots, potatoes, garlic and a tin of organic cannelloni beans.

Unfortunately, hubby has not caught on. He still buys potato chips and cookies and Dip-Its just because he happens to be near ALDI when Beth goes to jujitsu on Mondays. Oh well, better one of us spending than two!

For afternoon tea, I made a batch of banana-blueberry muffins from the overripe bananas in the fruit bowl, and added ALDI blueberries. They tasted good, although Beth wanted to know why the muffins were all sunken in the middle!

Today I made scrolls using frozen puff pastry, tinned fruit, almond meal and crushed peanuts. All from stuff I already had in the pantry and freezer. Note to self: make sure fruit is completely drained so it won't make scrolls all soggy!

Earlier in the month we trialled Aussie Farmers Direct. Love the convenience and being able to support the farmers, but the prices!!

Am staying away from those money-suckers Safeway and Coles as far as possible, and making ALDI our pitstop of choice. Hubby once found Excel study guides at $2 cheaper than our usual bookstore.

With ALDI you have to be vigilant because the specials change all the time and once they're sold out, you miss out. Anyone who wants to save $ has simply got to make ALDI their first choice for groceries and staples. Every time I leave the checkout and examine my docket I feel SO happy, like I've spent my $ well and lived responsibly. Very important when you're a one-income family with kids!

FB Experiments

A week after enlisting help from other FB users, the fan count is up to 86.

Amazing.

Am having fun checking out other biz pages and posting favourable comments about their products and services.

Perhaps I am more suited to building up other people's businesses rather than flogging my own.

Chatted with hubby today cos he was home sick. He asked me the usual pointed questions about business plans, working for others vs. working for self, how much $$ return I was getting on my marketing efforts etc. Felt depressed and low for a while and talked to God about it on the way to pick up Beth.

Have no answers for now but am praying that He shows me what He would like me to do.

Work for someone ...again? Maybe it's time to dust off the CV and start looking around. A part of me looks forward to interacting with like-minded professionals in a nice office somewhere in the Big Smoke.

And having spending money to call my own.

Am I Wasting My Time Being A Writer?

If something I desire does not flow to me naturally, does that mean I am not meant to have it?

And if so, does that mean pursuing it would be a waste of time and energy and I should instead be focusing on what I naturally do well?

This thread came out of a long Skype conversation I had with my uncle yesterday.

He observed that while my passion lay in writing, I do not seem to be profiting financially from it, because marketing is not my strength. I may need to team up with someone who is a natural at marketing.

Point taken.

Guess it all depends on how I want to measure my success.

If being a successful writer means being a well-fed one, then I am definitely in the category of the starving artiste who needs a regular day job to pay the bills. Ouch.

But if being a successful writer means doing what I love, being happy and fulfilled because of it, and enjoying the occasional affirmation from a grateful reader, then regardless of how many zeroes there are in my bank balance, I guess I am a successful writer.

Things I Need To Think About, Even Though I Would Rather Not

Had an interesting chat over Skype with an uncle today.

Lots to think about:

• Pros and cons of converting PPOR to IP
• Setting up family trust
• Gary Chapman's The 5 Love Languages (what are mine? what are my mum's? what are my children's?)
• What is my natural preference in relation to wealth dynamics - am I an ideas person? A connector/deal maker? A trader? A systems person?
• As an introvert, what am I marketing: myself? the products? What is important to me: building relationships and gaining trust, or selling to anyone who will buy?
  

HDB Flat: To Sell Or Not To Sell

Received an email from our tenant this week, asking if he and his co-tenants can extend the rental agreement for another year or two because they love our place so much and are so comfortable there.

First thought:
How nice! Of course, stay on, by all means. Couldn't find a nicer bunch of strangers to look after our place.

Afterthought:
But what happens if we want to sell?

J starts school in 2012 and I would really feel more financially secure if we dispose of the flat and bring some of the money over for school fees ($10K a year) and the added expenses of having two school-going kids.

More random thoughts, stream-of-consciousness style:

Should we ask the tenants if they have any plans to buy a flat and if so, would they like to make us an offer?
That would solve the problem of paying an agent to find buyers and go through the sales process, AND remove the burden of maintenance and upkeep as the flat ages. At least, the latter would no longer be our problem!
But how do we get a good price when the market for EMs hasn't moved in our favour?
We're looking at $450K based on sales statistics.
Not a very encouraging figure considering what we paid for it.
But we have to move on at some point and accept the possibility of losing money on the transaction.
How do we move our remaining possessions here at minimum cost?
And where will we store them?
Who should I get to draft the sales contract?
What if things go wrong because I didn't use an agent and miss out on an administrative procedure or two?
When is the best time to sell - 2011? Does the whole family need to go back to Sg?

More questions than answers.

I know the answers will come at the right time.

I just wish the path were clear RIGHT NOW and that someone Wise, Trustworthy and with our best interests at heart (God) would tell us CLEARLY what is step 1, step 2 etc.

Are We Doing It As Tough As They Tell Us?

Read this enormously interesting piece in the Domain newsletter today (Crying poor? Count your rooms and houses, and think again).

You know how the media and pollies keep telling us the average family is struggling with rising interest rates, defaulting on mortgages, struggling with the consequences of job loss etc etc?

The writer Ross Gittins has taken a counter view to prevailing opinion.

He observes that the person/s to blame for this pity party is ourselves.

Why are we upgrading to McMansions, renovating/altering existing houses and buying holiday homes?

Is anyone making us do it?

"We buy ourselves a fabulous new house, take on a huge mortgage then, when we find the payments a bit of a struggle, think of ways to blame it on the government or the banks.

And the media and the politicians - which sell themselves using self-pity rather than truth - encourage us. We take what's clearly a self-sought rise in our material standard of living and, driven by self-pity, mentally convert it into a rise in the cost of living."

That's what we need.

The inconvenient truth told like it is. Rather than the truth we prefer to hear.

*Update*

Just after I finished this post, I stumbled on to a serendipitously related article in the Brisbane Times: A Fate Worse Than Death. Enjoy.

Overwhelmed By Gratitude

I went to the ATM this morning to get some money for the gardener for tomorrow.

As I studied the tiny balance displayed on the screen, the feeling that came to me was one of...GRATITUDE.

Strange, isn't it? Here I am feeling blessedly provided for and taken care of even though my bank balance is missing a few zeroes at the end.

Yet why should I not feel thankful?

I have a home that is perfect for us and for our guests.

My husband has just had his contract renewed.

There are redraw funds available for school fees.

The children are healthy.

My creative right brain continues to suggest random ideas and to hear where Brass or Fantasia might fit in during band practice.

My passion for words, careers, wellbeing and growth is alive and well (sometimes a trickle, sometimes a torrent).

And I still (foolishly, perhaps) believe that each of us can make a difference in the world.

Yes, God is good - even in the midst of bushfires, floods, unsolved murders and the seeming senselessness of life.

Happy Valentine's Day!

I know Valentine's Day is such an overcommercialized occasion.

But let's look at how we can make it what it was meant to be: a time to remember those we love.

What do you do for those you love? What do you wish for them?

I'm guessing you would spend some time, effort and maybe money making them feel special.

And you would wish only good things for them.

Health. Peace. Abundance. Joy. Freedom.

So if your loved one could use some health-giving information, you could point her in the right direction, say to a book about nutritional medicine or a website dedicated to organic health products.

If your loved one has lost his job because of the recession or is struggling to find meaning in his work, you could show him how to create an income that doesn't depend on the economy or the benevolence of his employer.

As the oft-quoted wisdom says, the simplest and best things in life are free.

Happy Valentine's Day!

Lending To The World's Poorest

I was reading a one-of-a-kind blog post today and it gave me an idea.

How's this for a unique Christmas gift - make a microloan to a poor entrepreneur in the developing world.

The idea is not new. Think Dr Mohamed Yunus and Grameen Bank.

But Kiva.org is the first of its kind. It uses the power of the Web to connect small lenders like you and me directly to real individuals who need the money, who know what to do with it, but whom banks won't lend to.

For as little as US$25, you can change lives.

As the borrower repays the loan, you get your money back.

What a powerful and sustainable way to lift someone out of poverty.

How's that for a Christmas gift that keeps on giving?

Read on about how Kiva.org has inspired Ken Evoy.

The Entitlement Mentality

In the book Why We Want You To Be Rich - Two Men, One Message, Robert Kiyosaki and Donald Trump share their concern that Americans have become complacent.

People have come to expect the government to handle their problems and fix the future. Rich and poor alike expect government handouts. Big corporations are subsidized by the government. Farms and ranches would close down but for government handouts. The President of the US and members of the House and Senate expect retirement benefits from the government.

At the time of publication (2006), Social Security was in debt $10 trillion and Medicare, $62 trillion. It was projected that in a few years' time, the first of 75 million baby boomers would retire...and expect their government pension checks.

2 years on, the subprime crisis has thrown America into even greater financial straits. In such circumstances, how can the government possibly afford to take care of 75 million retirees?

The authors point out that the cause of this problem - our lack of financial resources - lies in a lack of financial education.

We have got to stop blaming others and expecting others to save us from the consequences of our own poor choices.

We have to start taking charge of our own situations.

We need to be part of the solution, not part of the problem.

To do that, we need to invest in our minds - our greatest asset.

Instead of relying on financial advisors or accepting unquestioningly the wisdom of the herd, we should take the time and effort to gain understanding.

Here are just a few suggestions from the book on the knowledge and understanding that we need to acquire:

• why the rich get richer
• the three types of investor and which one we are
• the four CASHFLOW quadrants, the values they represent and which quadrant we really want to belong in
• the difference between a saver and an investor
• the power of leverage
• good debt vs bad debt
• the financial challenges facing the US and the rest of the world and how they came about
• the history of the world
• the role of India and China in the world economy
• why diversification is not necessarily good financial advice
• why the middle class in America is shrinking

The Benefits of Failure and the Importance of Imagination

I love JK Rowling.

Not just for Harry Potter, but for her incredible life story.

It's an inspiring tale of resilience, of self-belief, of passion, of purpose, of courage.

She shares some of the magic in her commencement address to the 2008 Harvard graduates, which you can read here:
http://harvardmagazine.com/go/jkrowling.html

May you be inspired to fully live the life God has given you.

The knowledge that you have emerged wiser and stronger from setbacks means that you are, ever after, secure in your ability to survive. You will never truly know yourself, or the strength of your relationships, until both have been tested by adversity. Such knowledge is a true gift, for all that it is painfully won, and it has been worth more to me than any qualification I ever earned.
JK Rowling

Can you survive without a job?

I got thinking about this recently when we had dinner with friends who are new migrants.

The husband had just received a job offer from the Government, and you could tell the couple were elated.

He's waited six months, sending out applications and waiting for the phone call or email that can change his life and his family's financial position.

For a highly qualified Singapore professional, being jobless in a foreign First World country can be excruciating, a sort of baptism by fire.

That got me thinking.

Is it possible to have a life where you make money without getting a job?

Can you go against herd instinct and make money in other ways?
Why does everyone seem to think that getting a job is the best and only way to make money?

I was at the doctor's today for laryngitis. J had a nasty cough as well.

When I requested a medical certificate, the doctor's first question was: "What work do you do?"

I had to explain that I'm a stay-home mum, and that the MC was actually for my husband because he's taking carer's leave to look after us.

So he made out the MC in my husband's name.

It struck me as particularly galling that being a stay-home requires me to justify the work I do.

Perhaps I should have said "I am a writer" or "I am an online business owner".

Even then, I suspect the doctor would have looked suspiciously at me and thought I was being funny.

Isn't it interesting how the default position is that everyone who is able-bodied and not studying or raising a family should have a job?

Look at the way superannuation and bank loans are designed.

If you are an employee, your organization puts in the 9% or 17% contribution into your super.

The seeds of your retirement funds start from there.

When you want to borrow money to buy a house, the bank calculates your borrowing capacity and your serviceability capacity.

One criteria they use is your income.

Without evidence of a stable income over a period of at least 12 months, you might have to resort to borrowing from a second-tier financial insitution at a possibly higher interest rate (what they call lo-doc or no-doc loans).

How do you demonstrate a stable income over a length of time?

Again, a job is the best way to do it.

And yet, when you think of it, a job is hardly any form of security these days.

Recently, Ford Australia laid off 600 jobs. This was followed by a second-round cut of 350 jobs. On the same day that the 350 job cuts were announced, the company president resigned and returned to USA.

We are talking of nearly a thousand workers and their families whose livelihoods are suddenly threatened through a corporate decision completely outside their control.

If these workers receive job offers soon after, good for them.

What happens if they don't?
What happens if their reserves run out before the next job offer comes along?
What if they are single-income families where one spouse has stayed home to raise the kids?
What if there's an accident resulting in a disability, and the insurance company or TAC drags its feet about paying out?

These are the possibilities no one likes to think about.

We think it won't happen to us.

But bad things do happen every day that could threaten our family's welfare and put us in financial stress.

Studies have shown that finances are the main cause of domestic disputes.

If the sole source of income dries up, what then?

It is too awful to think about, so most of us refuse to go there.

But this is precisely why we need to make advance preparations.

We have to start thinking of alternative ways to make money while we are relatively financially stable, not when that stability is gone.

Banks lend money to you when you don't need it.

When you actually need money, you can be fairly certain the bank manager will politely show you the door.

Let's think for a minute of alternatives.

If you haven't got a job, or don't plan on getting one because you hate being tied down to one organization (which in a sense is what having a job is about), you could do one of several things:

• Hire yourself out as a freelancer or consultant, and do what you're skilled at, but for many clients rather than one. This way, you diversify your risk. If one client folds, there are always others.
• Convert a hobby into a stream of income. Teach music to the kids in your neighbourhood, walk people's pets, sell hand-crafted jewellery at craft fairs.
• Do jobs most people would be glad to pay someone else to do. Mow lawns, distribute fliers, do packing at ALDI's, do the ironing for someone who hates domestic chores.
• Start a business. If you have the capital and your market research has turned up an opportunity for your kind of business, by all means go for it. You could start from scratch or invest in a franchise. Not many people have access to large amounts of capital though, so if this is your situation, you may have to consider other low-cost ways of doing business.
• How about joining an MLM company? Of course you will have to do your due diligence and evaluate the opportunity before you part with a single cent.
• Now consider going online, like so many people dream of doing. When you do your research carefully, you will be surprised at how easily the Internet medium lends itself to all sorts of individuals, life situations and types of businesses. Including all the ones we've just discussed.

An online business is the perfect income-producing avenue for almost anyone.

Retirees who want to enjoy life their own way.

Career changers who - like 72% of American households - want to work from home.

Work at home parents looking for a way to help with the family expenses while looking after the kids.

Info publishers and infopreneurs.

Turn your specialist knowledge about something people want into a stream of income.

Elad did it with kids' parties.



Sellers of hard goods. You could be a maker of goods, a sourcer of goods, an artist, or someone who has found a unique way to present an array of goods from different sources.

Sellers of e-goods.Watch Tomaz turn tennis into checks.

Affiliate marketers who specialize in marketing and selling other people's products. They get a commission on each sale they make.

Network marketers who prefer a unique website to the company's duplicate website. With your own website, you have a better chance of reaching out to more qualified prospects than you could ever find time to meet or call individually.

Real estate agents. If you are an agent, you may have discovered that your company website doesn't do much to help you grow your business. How do you capture some of that online passing traffic and use it to bring in the buyers and sellers who are interested in the properties you are listing?

It's incredible just how useful and how flexible the Internet is. It can help you start a business, take control of your career and finances, and enhance the quality of your lifestyle to fit better with what you most love doing.

Mary Poppins & The Abundance Mentality

I've watched the musical Mary Poppins countless times with the kids.

Each time I do, I either learn something new or get an old lesson reinforced.

There's this bit in the story where , Bert, Mary and the kids travel back from the racecourse where Mary had just won a trophy and taught Supercalifraglisticexpialidocious to her audience.

It was raining back at the park and Bert's chalk drawings on the pavement were all ruined.

"Oh Bert," sighed Mary, "all your fine drawings."

Bert saw it differently.

"There's plenty more where they came from," he replied.

"Besides, looks like good chestnut weather to me."

Just think of that.

Bert is able to put a positive spin on what looks like a setback - he's no longer thinking of what he's lost (the chalk drawings) but what he can create afresh.

And he's looking at other opportunities the bad weather can provide, that silver lining every cloud has if we look hard enough.

If he can't sell chalk drawings, he can sell something else - hot chestnuts.

What a clever, resourceful, creative chimney sweep.

I can think of more applications.

Did you notice Bert hasn't confined himself to chimney sweeping? He's a chalk artist, a busker and a streetside vendor of hot chestnuts on cold, wet days.

Multiple streams of income. Yep.

But I'm thinking of something else too.

Bert hasn't allowed his current reality (being a lowly chimney sweep, which surely was fairly low on the social ladder for his time) to limit him from doing good, living well and expressing himself the best way he can.

In the story, he's also a friend to children and a counselor to adults (even those adults who wouldn't normally socialize with chimney sweeps).

Action Challenge
What's keeping you back from living a full life?
What can you start doing today to live a fuller, more vibrant life?