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The Deal of Your Lifetime

sale We have an idea for your personal finances. Now if you’re one of our regulars, we may surprise you a little with what we’re about to say …

Go out and spend some money!

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Markets go through cycles. Sometimes it’s a seller’s market. But right now, we’re in a buyer’s market for almost everything!

Now, before you take our advice and rush out the door on a quest for that perfect item, consider these four questions:

  • Do you feel relatively secure in your job or your business?
  • Are you debt-free except for your low-cost mortgage on which you’re current?
  • Are you funding your long-term obligations (e.g. the kids’ college, your retirement)?
  • Do you have a nice stash of cash set aside for emergencies?

If you clear those four hurdles, you’re good to go … to go get the deal of your lifetime.

Spend, baby, spend!

It’s good for the economy, but even more important, it’s good for you. Because we’re seeing deals right now that we will probably never see again in our lifetimes.

Like the car dealer who is offering a two-for-one sale – buy a car and he’ll throw in a second car of equal or lesser value for free! That’s right … free! Did you ever think you’d see anything like that?

Many contractors are starving for work. It’s a great time to remodel your home – get those improvements done you’ve been putting off, add that room, remodel that bathroom or kitchen.

While we normally don’t suggest building a new home, for financial reasons as well as the emotional strain it can put on a relationship, it’s a fantastic time to think about having that dream house built.

And let’s not leave out businesses. Vendors in so many product lines just want some business. It’s a great time to expand or upgrade your business.

The paradox

Here’s the irony in our current situation – spenders are faced with great deals, but they often can’t clear the hurdles above. So they can’t spend!

Many savers have seen the value of their investments fall back ten years. So perhaps the lesson – live a little now, too! It will go against your grain to go out and shop. But look at it this way – you’re saving money because, by doing it now, when suppliers across the board need the money – you’ll get the deal of your lifetime! 

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Thanks so much for reading our post today. Join us next time when we diss on Plan B. Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes. 

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Direct link to The Bigg Success Show audio file:
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Savers Spenders and Investors

investments When personal finances are discussed, the experts usually divide people into savers and spenders. We ran across a press release from Fidelity, the mutual fund giant, about a survey of workers in the non-profit world. They asked the participants if they were a saver, a spender or an investor.

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We thought it was very astute to add that third category. Which one do you fit in?

The workers in the study split themselves about evenly between saving and spending. 46 percent claimed to be savers while 45 percent admitted to being spenders. So that leaves only 9 percent who classified themselves as investors.

Merging the two categories

We suspect that fewer people today would classify themselves as spenders than say a year ago. A lot of us are getting on the savings bandwagon. That’s definitely a step in the right direction, but saving it isn’t good enough.

This data suggests a bigg idea. We shouldn’t think of ourselves as either savers or spenders. We should always think like an investor. We should merge the two categories – spender and saver – into the third category – investor.

We must know how to invest it or we won’t end up with the resources we need to live the life we want.

From spender to investor

Here’s some good news for spenders: thinking like an investor doesn’t necessarily imply that you don’t spend. It means that you spend differently.

You look at every single dollar you spend as an investment. Is it going to bring you enough return to make it worth giving it up? And that “return” may not come in dollars earned on dollars invested.

It may mean that it adds enough to your level of “happiness” to make spending the money worth doing. If it passes that test, then spend, spend, spend! If not, hold onto it.

For example, you may see a real deal on some non-perishable consumer good. Buy it. Stock up. Say an item is on sale for half off. Let’s pretend that you know that it only goes on sale once a year. If you buy a year’s supply, you’re making 100% on your money. That’s hard to beat!

So get to know the promotional cycle of the brands you use regularly and time your investment appropriately. Know when various businesses need the money more. For example, from car dealers to contractors, there are seasons when people are buying a lot and times when people aren’t. Time your purchase for their slow periods and reap the benefits.

From saver to investor

Now let’s think about savers. It’s great to save, but if you’re only earning two percent on your money, where’s that getting you?

We know … we know … you’d rather earn 2% than lose 40%! We completely understand that thought process.

However, investors don’t operate out of fear. They operate rationally. And we have to resist the temptation to go with the masses because they’re usually wrong in the long run.

Just like with consumer goods, there are some real deals out there on assets right now if you can afford to hold them long-term.

The best time to get out of a particular market is often when everyone else is getting in. And the best time to get in is usually when everyone else is getting out.

Years ago, we were told by a very successful real estate investor that when you see the no-money down real estate infomercials proliferating, it’s time to get out of real estate. How many of those do we see now compared to three years ago? 

Now think about stocks. Many of the same people who are touting doom and gloom now were spouting off about the end of the business cycle and the ever-upward spiral of stocks just a couple of years ago.

So to think like an investor, think for yourself. 

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Get the tips and tools you need to be a BIGG success.
Subscribe to the Bigg Success Weekly – it’s FREE!

___

Thanks so much for spending some time with us today. Join us next time when we ask, “Does haste still make waste?” Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes. 

Subscribe to the Bigg Success feed.

Direct link to The Bigg Success Show audio file:
http://media.libsyn.com/media/biggsuccess/00336-022309.mp3

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(Image in today's post by woodsy)

Does It Pay to be Greedy?

It’s okay to be stupid if you’re not greedy. It’s okay to be greedy if you’re not stupid. But it’s never okay to be greedy and stupid.

George said that’s why he’s never been greedy. A man has to no his limitations!


Bridge over troubled waters

But greed is a bit like confidence and cockiness. Picture a bridge … on this side of the water, we’re confident. But cross the bridge and we’re cocky. We adore confidence; we despise cockiness. And this bridge between the two can be very short. Of course, some people go way over to the other side. 

That’s also true with greed. There’s a short bridge between ambition and greed. It pays to get right up to the bridge … that’s where you’ll find bigg success.

But don’t go over it … that’s where mistakes are made.

This applies to our businesses, our careers, and our personal finances. If your goal is to achieve bigg things, you have to think and dream bigg.

But don’t cross the bridge, because greed is like a drug. Once a person starts, it’s hard to stop. Once they’re in deep, they start to do stupid things because they have to feed the addiction … the greed.

In this context, stupid means that someone isn’t thinking logically. They’re letting emotions rule the day, not making decisions based on the facts. They start thinking like a gambler, just rolling the dice and hoping for the best. 

A recent example

A great example is the most recent real estate boom. George has a friend who invests in real estate. During the boom, George saw some market data about returns on real estate investments. He didn’t think it made sense because the returns were projected at a lower rate than the known cost. So George asked his friend about it. His friend had an explanation that still didn’t make sense. They went around a few times. Finally George’s friend said that you had to count on someone being a bigger sucker than you (those are George’s words), but his friend confirmed it.

Look at what’s happened – a lot of people have lost small (even large) fortunes because of untimely real estate investments. We know the rest of the story. It all came crashing down.

What Warren Buffett says about greed

We’ve said that it’s okay to be ambitious, but don’t be greedy. But it appears that Warren Buffett may disagree with us. Warren Buffett, of course, is the great investor and chairman of Berkshire Hathaway. He says,

“Be fearful when others are greedy and greedy when others are fearful.”

So, according to Warren Buffett, there are times when it pays to be greedy. And apparently it pays well because he’s built his career (and his fortune) on being greedy when others were fearful. 

So we say it’s okay to be ambitious, but don’t be greedy. Warren Buffett says you should be greedy when others are afraid.

What do you think … does it pay to be greedy? Leave a Comment to share your opinion.

Subscribe to The Bigg Success Show in iTunes. 

Subscribe to the Bigg Success feed.

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Don’t Make This Costly Mistake

Which is better – a $100 decrease in costs or $100 increase in income?

It’s always good to increase our income, but more people get in trouble on the cost side. This applies to your business as well as your personal finances.

Your business
Assume that you own a retail store. Every product in your store sells for $100 and costs $40. So you keep $60 every time you sell a product.

Now let’s say you’re able to cut your expenses by $100. You get to keep all of it!

So, which is better? Cutting expenses by $100! That yields $40 more!

Now, you may ask, how do you do that? Here’s something we have learned …

As you get busy running your business, it’s easy for costs to creep in that aren’t increasing sales like you thought they would. Get rid of these costs!

One of the biggest complaints bankers have about small business people is that they are too focused on their top line (sales) and they don’t spend enough time thinking about the bottom line (profit).

In the long run, your profit can only grow as fast as your sales. But in the near-term, your bottom line will grow much faster if you keep a close eye on costs.

Your personal finances
This is the same story, but for a different reason. It’s all about taxes.

Let’s assume that you will pay 30 percent on your next $100 of income. So, if you make $100 more, you get to keep $70 after taxes.

But if you can spend $100 less, you’re $100 ahead because you’ve already paid the taxes on that money!

Let’s say you get a $5,000 a year pay raise. You decide to celebrate by buying a new house … you upgrade! Your mortgage payment is now $4,800 a year higher than it was before. But hey, you have $5,000 more income, so you’re still $200 ahead, right?

That’s BEFORE TAXES.

Once we factor in 30 percent for taxes ($1,500), you’re $1,300 behind!

And the bad news has just started. This new, bigger, more expensive house probably has higher property taxes; it costs more to insure; it requires more repairs and maintenance.

Before you know it, you’re $5,000 in the whole!

What should you do with the raise?

Once again, your specific situation will determine what you should do. Consider giving yourself a SMALL reward – you’ve earned it! Then, if you have any debt – particularly credit card debt – pay that off because your return will exceed almost any investment. And it’s a guaranteed return!

Once you have that debt paid off, the money becomes yours! Now you can invest it in things that will jump start your passive income.

The bottom line is this – you have complete control over your expenses. You have to convince someone to say “yes” to make a sale or get a raise. It’s much easier to control your costs!

Where have you cut costs in your biz or personal life?
Share your tips with us!

You’ve probably heard our bigg quote today, but it was so fitting that we used it anyway. Here’s Ben Franklin –  

“A penny saved is a penny earned.”

And we bet that, if ole’ Ben Franklin was around today, he’d think about the taxes he was paying and modify his quote to – A penny saved is BETTER than a penny earned!

Next time, we’ll continue the money talk, but with a twist. Comedic writer Jake Novak joins us to share his “Top 5 Signs You're Managing Your Money Like Wall Street.” Until then, here’s to your bigg success!

Related posts

Does It Pay To Be Smart?

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Freedom Or Security – Which Do You Choose? 

Don't Make This Costly Mistake

Which is better – a $100 decrease in costs or $100 increase in income?

It’s always good to increase our income, but more people get in trouble on the cost side. This applies to your business as well as your personal finances.

Your business
Assume that you own a retail store. Every product in your store sells for $100 and costs $40. So you keep $60 every time you sell a product.

Now let’s say you’re able to cut your expenses by $100. You get to keep all of it!

So, which is better? Cutting expenses by $100! That yields $40 more!

Now, you may ask, how do you do that? Here’s something we have learned …

As you get busy running your business, it’s easy for costs to creep in that aren’t increasing sales like you thought they would. Get rid of these costs!

One of the biggest complaints bankers have about small business people is that they are too focused on their top line (sales) and they don’t spend enough time thinking about the bottom line (profit).

In the long run, your profit can only grow as fast as your sales. But in the near-term, your bottom line will grow much faster if you keep a close eye on costs.

Your personal finances
This is the same story, but for a different reason. It’s all about taxes.

Let’s assume that you will pay 30 percent on your next $100 of income. So, if you make $100 more, you get to keep $70 after taxes.

But if you can spend $100 less, you’re $100 ahead because you’ve already paid the taxes on that money!

Let’s say you get a $5,000 a year pay raise. You decide to celebrate by buying a new house … you upgrade! Your mortgage payment is now $4,800 a year higher than it was before. But hey, you have $5,000 more income, so you’re still $200 ahead, right?

That’s BEFORE TAXES.

Once we factor in 30 percent for taxes ($1,500), you’re $1,300 behind!

And the bad news has just started. This new, bigger, more expensive house probably has higher property taxes; it costs more to insure; it requires more repairs and maintenance.

Before you know it, you’re $5,000 in the whole!

What should you do with the raise?

Once again, your specific situation will determine what you should do. Consider giving yourself a SMALL reward – you’ve earned it! Then, if you have any debt – particularly credit card debt – pay that off because your return will exceed almost any investment. And it’s a guaranteed return!

Once you have that debt paid off, the money becomes yours! Now you can invest it in things that will jump start your passive income.

The bottom line is this – you have complete control over your expenses. You have to convince someone to say “yes” to make a sale or get a raise. It’s much easier to control your costs!

Where have you cut costs in your biz or personal life?
Share your tips with us!

You’ve probably heard our bigg quote today, but it was so fitting that we used it anyway. Here’s Ben Franklin –  

“A penny saved is a penny earned.”

And we bet that, if ole’ Ben Franklin was around today, he’d think about the taxes he was paying and modify his quote to – A penny saved is BETTER than a penny earned!

Next time, we’ll continue the money talk, but with a twist. Comedic writer Jake Novak joins us to share his “Top 5 Signs You're Managing Your Money Like Wall Street.” Until then, here’s to your bigg success!

Related posts

Does It Pay To Be Smart?

How To Get Rich

6 Easy Steps To Financial Freedom

10 Signs That You Are Ready To Quit Your Job And Start A Business

Freedom Or Security – Which Do You Choose?