Category: Finance / Money / Wealth

Money Streams

7/16/2016

Financial opportunities and the flow of money are like streams of water in nature. Water flows when it rains and follows the path of least resistance. As a stream gathers more water along the way, it flows faster and stronger. If a stream hits an obstacle, it changes course in some way. It may flow over the obstacle, join an adjacent stream, or carve a new path altogether. If the rain stops, a stream eventually dries up. Streams are ever changing; they never stay the same.

Financial opportunities exist were people are ready, willing, and able to spend money (rain)..and it is easy to make a transaction (the path of least resistance). A stream of money begins to flow. If an obstacle pops up, via a new government regulation, competition, newer technology, or otherwise, that particular money stream will start to dry up. But people will find something else to spend their money on and create a new money stream somewhere else.

Financial opportunities are ever changing, and so are the streams of money that accompany them. A new technology/product/service/information will be invented and people will spend money on it as long as they find it useful and a good value. But things will change and that new technology will eventually become old technology and the money stream will dry up. When this happens, you must learn to jump to a new money stream.

If you are thirsty, look for water. If you have financial desires, look for a money stream.

How to gain personal financial freedom

7/10/2016

Do you desire less financial stress and more financial freedom? Here is a proven strategy...

Get familiar with Dave Ramsey. Memorize his seven steps to financial freedom which can be downloaded for free from his website.
Avoid debt in all forms and fashions. If you do not have the money in hand, do not buy something.
A mortgage on your primary home is tolerable, but not preferred. A mortgage should have the shortest term possible. The longer the term, the longer the bank has rights to your home, and the more money you pay them in interest.
Any personal debts outside of a mortgage should be paid off as soon as possible.
Always use a budget.
Talk to your spouse about the budget categories and amounts. It must be something you both can agree on.
Develop separate budgets for each adult, plus an overall family budget. This allows each adult some freedom and flexibility within their own budget, while keeping a focus on the overall family budget.
A budget needs to be as detailed as possible without being too complicated to track. Think thoroughly about what general categories you spend you money on or need to save for. Think through an entire year and include all major expenses and even those little expenses that add up over time. The more detailed the better. Once you have a complete picture of what you need to spend and save for, then you can compare this to how much money you earn after taxes, retirement saving, etc. Then adjust spending and savings accordingly.
Consider ways to increase your income if your budget is in the red. Taking on another job is a worthy consideration, especially if you have debts outside of a home mortgage.
Use cash whenever possible. The physical act of handling cash will force you to track how much you spend, and will it make you think about why your spending it. Plus, it feels good knowing the money in your hands is truly yours and serves as a physical reward for your hard work.
Do not use credit cards. They make it easy to loose track of spending and make spur of the moment purchases that you otherwise would not or should not.
The use of debit cards is acceptable on a limited basis, though not preferable. Only use debit cards for convenience purchases like gas station pay-at-the-pump, or larger expenses like hotel stays, etc.
Use envelopes to keep cash for your various budget categories. Write a category on the envelope and the amount that you have budgeted for it.
Budgeting on a weekly basis is best. It forces you to review your spending frequently enough but without being too cumbersome.
Go to the bank or ATM every week to make necessary deposits and withdrawals. Again this is a financially healthy habit that forces you to think about your saving and spending on a regular basis.
When getting cash for the week at the bank, be sure to get a mixture of $1, $5, $10, and $20 dollar bills. This makes it easier when distributing the cash into your weekly budget envelopes.
If you borrow money from one category for an emergency in another category, use a note card to write an I Owe You and put it in the envelope.
As you see cash building up in your various envelopes, you will enjoy saving even more.

Random Musings from a Wondering Mind

Money Streams

How to gain personal financial freedom

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