How I Will Be Rich

Archive for September, 2007

This weekend was an insanely busy weekend. Saturday morning we woke up to rain storms and we wanted to go to the Red Bull Air Races. We bought some tickets online and bundled up, hoping they wouldn’t be canceled. We got down to the San Diego bay at about 11:30 and it was still raining. We had out sweatshirts pulled over our heads with umbrellas and all. To our surprise, they were still letting people in with no sign of clear skies in sight. We walked in and found a spot on the grass where we could see the entire race course and waited with our umbrellas over our head. It was about ten minutes to race time and the clouds parted. The sun came out in full force and I wouldn’t be surprised if it got to be about ninety degrees. Everyone started stripping off layers of clothing and by the end of the day, our whole group was bright red. We came expecting to freeze our butts off and got sunburned instead.

The races were nothing short of amazing. The air races are a series of timed flights by little, single prop planes. These planes are crazy. They need to weave through tight turns and fly in between pylons. They must fly through the pylons at a certain height and they must have their plane tilted at the exact correct angle. It was amazing to see what these guys could do with their planes. I don’t usually spend money to go to things like this but it has never been in San Diego before and I had no idea if it would ever come back. I thought it would be worth the money for this, possibly, once in a lifetime event.

From the air races, my girlfriend, Alana, and I walked down the street to Petco park to watch the Padres get beat by the Colorado Rockies. That was really fun as well and I received the tickets for free from my sister who had season tickets. It was a bummer that the Padres lost but there was a fireworks display following the game and we had fun, nonetheless.

On Sunday morning, I woke up with anticipation for the one thing that I look forward to every Sunday; Football! I’m in San Diego and I’m a huge Charger fan. Unfortunately, they lost as well (This wasn’t a good weekend to be a San Diego sports fan). Alana, Joe and I all get together every Sunday to watch the Chargers game. I could probably write a whole blog about my opinions on the Chargers so far this season and what they accomplished last season but that’s for another time and another place.

After the Charger game, Alana and I went couch shopping. That was actually pretty fun. We went from store to store and lounged around in various couches. Alana eventually purchased one with inheritance money from her grandparents.

We finished our day with a trip to Best Buy. This is where I spent more money than I would usually spend. I bought myself a 500 GB Western Digital Hard Drive. I believe this is one of those items that could actually save me money in the long run. I bought it with the idea of transferring all of my CDs and a lot of my movies on to it. This way I can go and sell a lot of them in an attempt to de-clutter a little. I think I can probably make my money back on the hard drive by selling about 20 of my old CDs…

Sorry for the long personal post. I figure it’s probably a good idea to give some insight in to my personal life here and there so readers can understand a little more about who I am.

-M

Since the beginning of this blog, Matt and I have been swimming with ideas for future business plans and directions we would like to travel. By starting and writing this blog, we have been given an opportunity to discuss some of the ideas we’ve had while considering various strategies to achieve them. Matt has written posts How to start a Business in California (Pt.1) and (Pt.2) that have showed the preliminary steps that we have been starting to take. These posts only show the tiniest pieces of the pie that’ll need to be taken care of while starting a business. These are very important and necessary steps to complete, but an equally required point to cover is the planning and strategic side of the equation.

A vital tool to figuring out the strategic side of any business idea is knowing and understanding the acronym: SWOT. First, after fully planning and figuring out what will go into your business idea on paper, the next step is to analyze the company’s SWOT. While going through this process you’ll be able to focus on the strengths and realize weaknesses early so the business plan can be amended. With this well-rounded business plan and a completely understood approach, you’ll be able to safely move towards getting the ball rolling.

The acronym SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. This is an analysis of the business plan that covers both internal and external factors. By using this tool, you’ll be able to see the pros and cons before even putting any money into a project.

The Strengths and Weaknesses categories are both internal factors. These are pretty self-explanatory, but they are the aspects of your business that you would be directly in control of. Some of these would include the proper management of staff, managing cash flow, knowing the company’s capacity of supply and demand, and the overall efficiency of your operations.

The Opportunities and Threats portion are external factors. These two are influences outside of your control and are normally external environmental factors. By pointing out these aspects of the business, you’ll be able to try and cradle the Opportunities to make the most of them and, hopefully, avoid the Threats before they occur. A few examples of these are changes in the economy, new technologies, outsourcing, industry/customer needs, and weather issues.

All in all, after using the SWOT analysis on your business plan, you’ll have a much better understanding before contributing a large start-up financial investment.

About a week ago I received a response to my post, “No Reason Not To Have a Roth IRA“, with some reasons to actually not have a Roth IRA.

Richard Wrote:

1) The amount you save each year for retirement does not exceed the amount necessary for full 401(k) employer match. I have decided calculated that I can save X percent each year for retirement. Since my employer matches 25% for that X percent, I would be losing out on an instant gain of 25% (not to mention that it otherwise would be after tax dollars) by putting the money into the Roth.

Whenever I have discussed this with friends, they say that if I’m only contributing up to their match, then I’m not contributing enough. To this I respond that my employeer (though this is rare) will match 25% on up to the government limit (15,500). So my X is actually a pretty hefty sum.

2) The other money I am saving (like for a downpayment) is for short term goals. For this reason I invest the money in an ING account. Although I could invest this money in an ROTH and pull it out when I need the house, what if the stock market drops right before I decide to buy this house. The one thing people neglect to mention about ROTHs is that although you can pull out your contributions, you can’t do that if the value of the account is below what you’ve put in. With my ING account I’m guarenteed (FDIC) to have the money I’ve put in.

I believe Richard makes some very valid points. In response to #1, I agree that if you have an employer matched 401K, you should definitely take advantage of that. A lot of employers do not offer this sort of benefit. I do believe, however, that a Roth IRA can be beneficial on top of the 401K. The downside of a 401K plan is that the tax is deferred and must be paid once you withdraw. With a Roth, you are paying income taxes before investing and you are not required to pay taxes on your capital gains. A lot of companies limit what you can invest in with your 401K funds as well. With a Roth IRA, you are limited only to what your broker provides. You can allocate your assets differently between the two.

As far as a response to your second comment, I do agree that a Roth IRA is not the best plan for saving for house. The point that I was trying to make is that those funds aren’t untouchable if you absolutely need to use them for a down payment. When purchasing a house, you are much better off coming up with a down payment without touching your retirement accounts. But your IRA is there if necessary.

-M

I was surfing the web the other day and you’ll never guess what I found. It was a blog post called My 4-Hour Work Week Experiment over at a blog called Small Business Guru. I thought this was very interesting seeing as Joe and I had originally planned an outsourcing experiment. This guy has actually done what we were planning on doing. He looked at three outsourcing companies in particular. He looked at Your Man in India, Brickwork and Elance.

He basically found that:

• Brickwork was not at all cost effective. It was going to be about $600 per month.
• YMII had communication issues and didn’t quite produce the results that he had hoped for and
• He found a company on Elance called Kaya Systems that he just loved.

Joe and I still plan on using a virtual assistant to get a few tasks done and do some experimenting. This blog post, however, has probably affected who we will experiment with. Chances are, Brickwork will be a little more expensive than what we can hang with and if they had issues with YMII (which is actually Get Friday), we probably will as well. I’m thinking about giving Kaya Systems a shot and also investigating some of the other companies available through ELance.

I’m a huge fan of Tim Ferriss’s Book but I’m starting to wonder about the validity of some of his outsourcing claims. I’ve realized that these outsourcing companies are out there but are they really as affordable as claimed?

Anyway, the point is, go check out that blog post if you had any interest in our outsourcing experiment but feel like you were left hangin. (We’re sorry, we will get back to it).

-M

I’ve decided to compile a list of blogs that I like. This is a list of sites that if read and followed may make you wealthier, healthier and happier. I know it seems like a lot but if you have a good blog reader, you can subscribe to them and then once a day browse through the titles and just come back to the posts that grab your interests. Originally I was going to make a list of sites to make you wealthy but due to the fact that we’ve launched a new site about health, I thought it would be appropriate to give you some blogs that I read regarding health and happiness as well.

Wealthy

1. Andy Beard -Search Engine Performance, Wordpress, Niche Marketing and Affiliate Marketing Tips
2. Blogging Away Debt – A great site about making money and reducing debt
3. Blue Hat SEO – Tips for marketing and Search Engine Optimization.
4. Blueprint for Financial Prosperity – Earn More, Save More, Live More
5. Boston Girl’s Open Wallet – A single 30-something Bostonian who is seeking enlightenment and control of her Net Worth.
6. Calvin Warr – Fun marketing ideas
7. Clever Dude – Personal finance advice.
8. Consumerism Commentary – More personal finance advice.
9. Copyblogger – Copywriting tips for online marketing success
10. Daily Blog Tips – Another great site that will help you make money blogging.
11. DoshDosh – Helping You Make Money Online
12. Entrepreneurs Journey – Another great site about building wealth through blogging.
13. Finance is Personal – Finance advice posting about 3 times a day. Always fresh material.
14. FiveCentNickel – More personal finance advice.
15. FreeMoneyFinance – Another great site for personal finance advice.
16. Frugal For Life – A site about frugality and spending wisely.
17. Get Rich Slowly – Some more great business and finance advice from a fellow business owner.
18. Hannes Johnson Dot Com – Make money online marketing on the internet.
19. Home Based Business – Online home based business opportunities. Free home business ideas.
20. I Will Teach You To Be Rich – Follow his advice and he may make you rich. (The first finance blog I started reading)
21. It’s Your Money – A Site about wealth building and personal finance.
22. John Chow – This guy wants to teach you how monetize your blog (By any means necessary).
23. Kyle’s Cove – Technology, blogging, WordPress, SEO, and making money online
24. Lazy Man and Money – Another great site for more personal finance advice.
25. Make Money Online The Quick and Easy Way – Watch the journey of one women going from stay at home mom to internet millionaire.
26. Matt Cuts – Great SEO information
27. Mighty Bargain Hunter – A site about being frugal.
28. Money, Matters and More Musings – Another great site about wealth building and personal finance.
29. MsDanielle – Internet Marketing, PPC, and Online Social Networking
30. My Affiliate Journey – Affiliate marketing
31. My Money Blog – A great site about wealth building and personal finance.
32. My Personal Finance Journey – Another really good site about wealth building and personal finance.
33. My Two Dollars – A place to discuss money for the rest of us.
34. North x East – A site with a lot of blogging tips.
35. Not Made of Money -A Site about saving money and frugality.
36. One Man’s Goal – Watch one man make the journey to become a full time blogger.
37. Online Marketing Blog – A blog about online marketing.
38. Personal Finance Advice – The name says it all.
39. ProBlogger – Want to make money blogging? This site can teach you how.
40. Pronet Advertising – Read about one man’s experiences in online marketing.
41. QuickSprout – Tips for marketing and Search Engine Optimization.
42. Search Engine Land – Learn about Search Engines.
43. ShoeMoney – Another site with ideas on making money on the internet.
44. Simply Thrifty – A site about being frugal.
45. StockTradingToGo – A great resources for investing tips.
46. The Digerati Life – Personal finance advice from a great writer.
47. The Simple Dollar – All sorts of personal finance advice.
48. Young and Broke – More personal finance advice.

Healthy

49. DietHack – A great site for health related articles.
50. FatBlokeThin – Losing weight the Buddhist way.
51. HealthMad – More tips to live healthy by many authors.
52. Healthy, Fast and Cheap – A site about cooking foods that are healthy, fast and cheap.
53. Her Active Life – A great site about eating healthy and excersize (great tips for men and women).
54. He’s Fit – A great site about eating healthy and excersize (great tips for men and women).
55. Live Live… Organics & Your Health – A great site with tips on healthy living.
56. Nurture Your Life – Another great site with tips on healthy living
57. Raising a Healthy Family – The name says it all.
58. Ririan Project – Tons of great tips to live a healthier lifestyle.
59. Sexual Health Buzz – A site about staying healthy while being sexually active.
60. Spine-Health – For those people who suffer from neck and back pain (Like I often do).
61. The Diet Pulpit – Eat healthy.
62. The Final Sprint – A great health site with a major focus on running.
63. Total Wellbeing – Healthy living for the body and mind.

Happy

64. 43 Folders – Personal productivity and ways to make your life better.
65. Brip Blap – A blog about life, family, career, personal finance, career, productivity, health and the environment.
66. Dumb Little Man – A group blog of people giving tips for anything and everything.
67. Genius Types – Creative Life and Money.
68. LifeHack – Another Site about pretty litterally, everything.
69. LifeHacker – Literally, A site about everything.
70. Pick the Brain – A great site about self improvement.
71. Scott H. Young – Another great site about self improvement.
72. Steve Pavlina – Personal development for smart people.
73. The Blog of Author Tim Ferris – A great site with tons of advice about everything.
74. The Consumerist – A Site about everything to make life better.
75. The Happiness Project – The name says it all.
76. The Positivity Blog – Be happy and be positive. Great Advice.
77. The Thinking Blog – Expand Your Mind.
78. ZenHabits – A site about organizing your life and becoming a happier person.

That’s my long, comprehensive reading list. As you can see, I read a lot of blogs. Feel free to comment on who else deserves to be on the list and what not. Check out these blogs and enjoy!

-M