Archives For May 2010

Credit Union

Brent Pittman —  05/26/2010 — Leave a comment

Well my wife and I both have opened up our business accounts with a local credit union (email me and I’ll tell you which one).  It was a pleasant experience it seemed like the CU really wanted our business.  We have to keep $250 in savings or have 1 transaction a month to avoid a $5 fee, but other than that it is free checking and savings.  They are going to hold our first check deposits for 7 days until we show a history of “good checks”, but it makes sense to me  We also will get more freebies once we have more money and transactions with them like a free notary service.  Now the fun part…looking for another credit union to do our personal banking with…any recommendations for credit unions in L.A. ?

Don’t Buy Gold

Brent Pittman —  05/19/2010 — 3 Comments

Investing in gold is a hot topic these days.  Do you realize when the ads for gold come on?  It’s late a night, just after the commercial for a knife that has a laser beam for $19.99.  Why don’t they advertise during popular sitcoms?  Because they have a better chance of catching down and depressed people late at night!  A recent article on Bloomberg.com argues that gold is not a good bet against inflation

However, gold’s record as an inflation hedge is more mixed over the long-term. Because gold fell from 1980 to 2001, the metal’s total appreciation from 1972 to 2001 was just 336.5 percent. That barely beats inflation over those 29 years of 323.7 percent, and is way behind the 2,466 percent return of the broad Standard & Poor’s 500-stock index if dividends are included.

If you want a good hedge against inflation then why not buy and own a house that is easier to sell than gold?  Over the long run Gold barely beats inflation.  See Chart.  In 1910 gold was worth $18.92, as of today it is worth $1210.00 an ounce.  While this seems impressive, but over the long-term with inflation added, see what gold does.  An article by Motley Fool shows some research:

According to University of Pennsylvania finance professor Jeremy Siegel in his seminal book Stocks for the Long Run, here’s what a dollar invested in various things would have grown to, from 1802 to 2001. (Amounts have been adjusted for inflation.)
  • Stocks: $599,605
  • Bonds: $952
  • Bills: $304
  • Gold: $0.98

So do you still want to invest in Gold?  I recently heard a personal story about a man who called into one of those late night gold commercials and bought a large amount of gold.  A few nervous and scary days later the gold prices plummeted and he sold it all, resulting in a $20,000 loss.  This is not something that I personally want to be involved in based on the history of gold.

Sure you could get rich day trading gold or stocks, but I prefer to sleep well at night and not lose my shirt (like most day traders)  So go ahead you gold bugs, keep on buying…I hope you are able to  sleep tonight.

Photo Credit  liquidnight

Listen to Dave Ramsey on KFWB in Los Angeles, AM 980. Current Times are 11am-2 p.m.  I am so pumped that Dave is on in the L.A. Market now.  As a financial counselor trained by Dave Ramsey’s organization, I fully support the show.  Please support KFWB and let them know that you appreciate them hosting the DAVE RAMSEY SHOW.  Email comments@KFWB.com

 


Big Box Banks

Brent Pittman —  05/12/2010 — 1 Comment

Don’t I own some of those ATMs since the government owes a percentage of the banks and I am a tax holder?

Continue Reading...

It is fairly simple.  Income-Expenses=Net Worth.  Of course you can get much more complicated with exceptions and additions; especially if you are Goldman Sachs hiding money.  Debt would be included in the expenses of course.  You can expend a lot of energy reducing debt and watching your spending habits.

But there is another side of this equation…Your INCOME.  If you have a big shovel, then you can dig out of a big hole.  That is ‘down home’ talk for if you have a large income you can pay off a big debt fast.

If you are in debt and or desire to build wealth (so you can give it away later and do some good in the world).  You might want to make some money and even have fun doing it.  So, what do you want to be when you grow up?

Some great resources for finding jobs and start doing what you love can be found through Dan Miller (Affiliate Link).  He has written several books No More Mondays, and 48 Days to the Work You Love.  They will jump-start the way you think about work and assisting you in finding work that is really play.

So work on your math.  Get a bigger shovel, decrease your hole, and get to work!

Action: How can you increase your income?