Little Machines that Print Money

Little Machines

Imagine there exists a little machine you can purchase that costs $100. This machine prints out $8 per year each and every year. You can buy more machines growing your yearly print out of money, or simply enjoy the $8 a year. After a few years you could sell your machines if you are in need of some money or hold onto them for decades enjoying the cash production of your money printing machines. When you decide to sell the machines the price might have risen giving you $140 for the little machine you once paid $100 netting you an extra $40. Would you go to the store to purchase one of these machines and watch as it slowly prints out money?

Hidden Gems

If you read my Intro to Budgeting blog post, you know about Net Worth. Most people focus on their house and vehicle part of their assets which makes sense since they are the largest assets people have. But, in all of our homes we have stuff, sometimes referred to as crap by those we live with. This stuff may not be worth anything to us, but it can be worth a lot to someone else. As they say, “Another man's trash is another man's treasure”. Obviously something’s value is only worth as much as someone is willing to pay. So it's important to note that although most people would not pay for an unopened StarWars Pogs from the 90s (I actually have this). A handful of people would be interested and a smaller amount would pay good money for it. Everyone’s home is just like this, full of hidden gems, just like the show Antiques RoadShow or American Pickers and Canadian Pickers.

12 Money Tips You May Not Know

 

1. Saving money is much easier than making money. There are a thousand ways to save money but getting a better job is the only way to make more.

2. A $1.00 saved is $1.30 Earned. Money in your bank account has already been taxed, if you can save $500 on a purchase you are actually saving yourself from having to earn an extra $800. Give or take

Maximize Your Dollars

Spending

Spending is inevitable.

That's why it is good to have a spending plan or at least some strategies on how to maximize your dollars. Money is a representation of work done and conversion to goods and services. You could have a billion dollars in Venezuelan but that would only be worth 278.67 USD. Money is only worth what you can purchase with it, or in other words, purchasing power. Most people are making as much money as they physically can each year so their income or purchasing money is fixed. But there are some strategies to extract more value from your dollar.

Mindset Shifts for Financial Saving

How to Save

Saving is easy, just don't spend money. I am over simplifying it, but it's pretty much impossible not to work. Saving money is like losing weight on a diet. In both cases you are cutting back in order to reach your goals. Everyone knows in order to lose weight you need to eat less and exercise yet there is a billion dollar industry that relies on helping people achieve weight loss. Financial literacy is similar. Saving money is straightforward yet people pay for count books, guides and coaches. Financial literacy is lacking in society and most of the reason why I started a blog in the first place. There are mindset shifts and tricks that can help one be more mentally  decisive and mindful in their financial decisions.  

Investing to Secure Your Financial Future

Need for Investing

Investing is just taking money and stashing it away for your future self. It is sacrificing what you want or could have so that you can have more at a later time. Now if we all had perfect immortal bodies that would never get sick or tired there would not be nearly as much need to invest. One could simply work right up until they died paying all their bills and living paycheck to paycheck maximizing their income. But life is messy and unexpected bills come up and we have mortal bodies that get old and break down. Saving for a rainy day is not just a good idea, it's a necessity. 

Needs vs Wants

Needs vs Wants

It's important to note while cutting back on spending is good, there are some things you should not cut back on, just like you should not cut out all food and eat nothing on a diet. There are Needs and Wants. When it comes to anything in life it is easier to do nothing than it is to do something. Not taking a vacation is easy, we do it all the time. Not buying a luxury car, super easy because these are large wants. Wants can be avoided, but Needs, need to be taken care of. Wants can be put off and neglected which of course can save money. If we give into every impulse to spend we would be in rough financial shape. You may even say, well when I am making more, then I can buy whatever I want. False, according to CNBC 50% of those making more than $100,000 a year are still living paycheck to paycheck. This is called Lifestyle Creep. It is important to try and live minimally and do less in order to save. Keeping your appétit in check.