“How can I help people become better investors?”

That is the question I’ve been asking myself lately. As most of you know, it is my passion statement to help people accomplish far more than they ever thought possible with their personal finances. And “accomplishing far more than you ever thought possible” is IMPOSSIBLE without learning and using investment knowledge.

I want to make sure our team can serve you best so we have prepared a brief survey to learn a little more about this awesome group of people we call the “I Was Broke. Now I’m Not.” Tribe. By the way – we’re honored to have you as a part of it! Below is an 8 question survey. Would you help us out by taking 2 to 3 minutes to fill it out? Your feedback really matters, and I would be so grateful!

 

Anyone who has attended a Financial Learning Experience has heard me say that it is important to INVEST money and to do so every single time you are paid money. At the end of our live events, I am regularly asked or emailed the following question:

“What investments do you recommend?”

My answer is always, “I don’t recommend specific investments. I can only tell you the investments I own, and they have worked well for me. The investments you choose are up to you.”

Occasionally, I update everyone on the investments I currently hold. Below is a chart of the current investments we hold. If it is publicly-traded, I have included the ticker symbol. Click on the chart itself (or HERE) to see a larger version.

We have finally seen the market improvement that many people expected. With companies declaring record profits and sitting on record amounts of cash, I’m seeing that they are finally beginning to invest again. That should bode well for investors and the economy at large. At this moment, I will continue to purchase individual stocks as well as research private investments – particularly small businesses (my favorite!).

Here’s the pie chart showing the investment distribution:

My thoughts:

1. The stock market has been hot, but nothing is ever hot enough for me to put all my eggs into one basket. I greatly prefer diversification beyond the open markets.
2. A lot of day traders think they are incredible geniuses right now. That’s not because they are all awesome – it’s because it is hard to lose in this type of market! As enticing as day trading may seem, it feels a lot like gambling. I prefer being a “slow & steady” and “stay the course” investor.
3. Tracking net worth on a monthly basis has made me a “first-hand witness” to the incredible momentum of my investments. Without consistently tracking net worth, I’m pretty sure I would have missed it!

Your thoughts?

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Disclosure

Anyone who has attended a Financial Learning Experience has heard me say that it is important to INVEST money and to do so every single time you are paid money. At the end of our live events, I am regularly asked or emailed the following question:

“What investments do you recommend?”

My answer is always, “I don’t recommend specific investments. I can only tell you the investments I own, and they have worked well for me. The investments you choose are up to you.”

Occasionally, I update everyone on the investments I currently hold. Below is a chart of the current investments we hold. If it is publicly-traded, I have included the ticker symbol. Click on the chart itself (or HERE) to see a larger version.

In my last update on March 30, 2011, I shared that I was focused on diversifying my investments beyond publicly-traded instruments (stocks, bonds, mutual funds, ETFs, etc.). The below chart shows continued progress as a result of that focus.

Can’t see the chart? Click HERE.

My Thoughts:

• It is vitally important to maintain margin. Cash on hand is essential to the long-term success of any effort – personal, small business, or large business. As a result, you can see strong cash holdings.
• Some of these funds are not open to the general market, which is why they do not have a “Ticker Symbol”, but I am able to invest in them through my previous employer’s 401(k) plan.
• One reason I hold so many mutual funds is because of a variety of 401(k), 403(b), Roth IRA, and 529 holdings – each plan has different mutual fund selections available.
• I do not “eat, sleep, and breathe” the stock market on a daily basis. I update my net worth once per month, but rarely jump in and out of funds. Day trading is definitely not for me.
• Our small businesses are growing – and we are putting people to work! That FIRES ME UP!

I would love to hear your thoughts on these investments!

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Equipping my children to be a blessing to others is one of my top priorities in life.

As part of this quest, I have had my daughter invest some of her money into a mutual fund.  As I explained mutual funds to my beautiful seven-year-old girl, she immediately grew alarmed.

“I could LOSE some money?!?!?”, she exclaimed.  This outburst was immediately followed by, “I am not interested in that type of investment.”

It was a very interesting discussion that helped me understand why so many people are financially stuck – they absolutely refuse to take any risk.

I know a couple that have budgeted their entire lives and have always lived within their means, but they are arriving at retirement with virtually zero savings.  Why is this?  Because they never prioritized investing because it would require risk and “they might lose some of their money.”

Many people jumped out of the stock market when it collapsed in 2008.  They jumped out at rock bottom due to fear of losing it all.  Those who remained in the market were generally financially whole within two years and have gained substantial ground since then.

Some people have said, “I would have been better off to leave my money in a CD instead of investing it into the stock market.”  I ran the numbers on my investments and discovered that even with the drop of 2008, my investments were still way ahead of CD rates of return!

In fact, CD rates are lower than the inflation rate.  Even if the CD interest earnings are tax-protected, the saved money will still lose overall purchasing power.

What are your feelings about taking risks with your investments?

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It has been over three years since I provided an update on the investments that I hold.   Anyone who has attended a Financial Learning Experience has heard me say that it is important to INVEST money and to do so every single time you are paid money.

At the end of our live events, I am regularly asked or emailed the following question:

“What mutual funds do you recommend?”

My answer is always, “I don’t recommend mutual funds.   I can only tell you the investments I own.   In general, they have worked well for me.   The investments you choose are up to you.”

So today, for those inquring minds who want to know …   I am publishing some of the mutual funds/investments that I own.   Click the image to see a larger version.

I have went even further in my analysis this time to indicate my portfolio diversification.   Over the past several months, I have been writing and speaking to the fact that I am diversifying my investment portfolio to include land and real estate.   The portfolio below indicates some of those decisions.

NOTES

• As you may have noticed during the latest recession, a rising tide will lift all ships and a lowering tide lowers all ships.   If you have market funds, you saw this happen.   There were many great companies that retained profitability throughout the market downturn, but their stock value was pummeled due to the overall market conditions.   While I have been greatly diversified in my investment choices, I was diversified WITHIN the stock market.   This is one of the reasons that I have made a focused effort to diversify my holdings beyond the open market.
• I believe it is important to maintain margin.   Cash on hand is essential to the long-term success of any effort – personal, small business, or large business.
• Some of these funds are not open to the general market, which is why they do not have a “Ticker Symbol”, but I am able to invest in them through my previous employer’s 401(k) plan.
• One reason I hold so many mutual funds is because of a variety of 401(k), 403(b), Roth IRA, and 529 holdings   – each plan has different mutual fund selections available.
• I do not “eat, sleep, and breathe” the stock market on a daily basis.   I update my net worth once per month, but rarely jump in and out of funds.   Day trading is definitely not for me.

Investment Junkies:   What are your thoughts on my portfolio?   What are some key funds that you really like that have worked well for you?

Looking for additional Personal Finance Resources?   You can obtain FREE FINANCIAL TOOLS by clicking HERE and purchase books/materials by clicking HERE.

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In THIS POST back in August 2007, I shared several of the mutual funds that I own.  A quick glance will reveal the name "American Funds" six times in my mutual fund portfolio.  Why do I own them?  Because they had great track records and lower ongoing management fees than most of their peer mutual funds.

(logo borrowed from AmericanFunds.com website)

However, American Funds mutual funds are front-end loaded mutual funds.  A load means that there is a sales charge to purchase a share of the mutual fund.  If one is just getting started out, there is a 5.25% sales charge.  This means that if you have a $100 bill to invest, only $94.75 will make it to the mutual fund.  Which is annoying.

BUT, I still invested in American Funds' mutual funds because they simply had great track records.

So, as I was reading CNN's Personal Finance web site, I was very interested to read an article titled "Are American Funds A Good Buy?"

Very interesting.

By the way, I don't sell mutual funds or ANY investment product.  I DO sell copies of my book, I Was Broke. Now I'm Not.  I truly believe that the information in this book will help you take control of your finances and achieve financial freedom.  You can purchase a copy via PAYPAL or AMAZON.

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Jenn and I purchased a thirty-year-old home in February.

This is not like a new home.  This house has neat features like creaks, leaks, painted over wallpaper, rotten decks, aged/dated appliances.  It also lacks the wonderful feature of "maintenance-free lifestyle".

It has been VERY interesting doing the home updates/upgrades/repairs thing.  However, the to-do list is over 5,130 items long.

We have decided to spend some money to upgrade something on the house soon.  I have heard that updating the kitchen and the master bathroom is the smartest thing to do because it is what really helps resale value.

So, Jenn and I are debating which of these two projects to do next.

1) Update the kitchen (complete tear-out, new flooring, cabinets, appliances, and restructure walls)

2) Update the master bathroom (complete tear-out, new flooring, cabinets, tub, toilet, vanities, and restructure walls)

I would love to hear of other's experiences with this!  How much did you spend?  Did it help resale value?  What lessons did you learn?

I am PUMPED UP to be in Dayton, Ohio this coming SATURDAY to teach the Financial Learning Experience!!!  If you are anywhere near the Dayton area, I would love to meet you there!  You can sign up for the event HERE.

Looking for additional Personal Finance Resources?  You can obtain free tools by clicking HERE and purchase books/materials by clicking HERE.

Anyone who reads this blog with regularity knows that one of the key reasons I want you to become debt-free is so you can invest more!  Investing means that Jenn and I will be able to achieve many of our hopes and dreams!  It means that our current sacrifice will allow us to purchase financial freedom for our future!  (Perhaps the number of "!" indicates my level of excitement about this!!!

Well, one of the most common questions I receive is "What mutual funds do you recommend?"

My answer is always, "I don't recommend mutual funds.  I can only tell you what ones I own.  What you choose is up to you."

So today, for those inquring minds who want to know, I am publishing some of the mutual funds/investments that I own.

As I prepared this list, I realized several things:

• We have too many accounts.  We have a rollover 401(k), rollover 403(b), 529, Roth IRA, 401(k), and a SIMPLE IRA.
• I am OK with some risk, but for some reason or other I have purchased some bond funds.  Maybe that is part of my inner-security needs bleeding out … ?
• I can't tell you exactly why I own all of these funds – that CAN'T be good.  I really hold to the belief that I should not own anything that I can't tell you exactly why I own them.

Do you have any funds that you really like that you think I should be considering?

Looking for additional Personal Finance Resources?  You can obtain free tools by clicking HERE and purchase books/materials by clicking HERE. 

Purchasing a home can be a HUGE task – especially for a first-time homebuyer.

In hundreds of financial counseling sessions, I may not have seen it all, but I have seen a lot.  So here are some tips to make your home purchase a winner.

• Don't buy a house that has a total house payment (principal, interest, insurance, taxes) greater than 25% of take-home pay.  The bank will lend you far more than 25%, but trust me.  If you go purchase a house that has a payment of more than 25%, you will start really feeling a pinch on your overall lifestyle.  Your entire existence will be focused on making the house payment.
• Put down at least 5% of the purchase price.  Even better, make that 20%.  You can purchase a house with 0% down or 3% down, but to obtain a conventional mortgage with the best rates, you will need to put down at least 5%.  However, if you do not put down at least 20%, you will have to pay PMI (private mortgage insurance) and that will cost you $500 to $1,000 or more more year!
• Buy a house that is at the average or lower of the other houses in the neighborhood.  This allows better opportunity for your house to increase in value.  When you are the largest and most expensive house in the neighborhood, you stand a good chance of have a decreased growth rate in your home's value.
• Wait overnight before signing a contract on a house.  You will think more clearly about a house when you have slept on the purchase decision.  It also puts separation between you and the emotion of the house.  This allows you to make sure it is a good financial decision.
• If you are not convinced that you will be in the house for two years or longer, consider NOT purchasing a house.  Renting is so much easier in short-term situations.  Yes, you might have to pay to break a lease, but it is WAY easier than preparing a house to sell, actually selling it, and then closing on it.

OK commentors – What are some tips you want to add?

Looking for additional Personal Finance Resources?  You can obtain free tools by clicking HERE and purchase books/materials by clicking HERE. 

Ever had "gotta-have-a-house" fever?

This is a condition that affects many people.  It causes them to say, "I've got to get a house.  I am throwing money away by renting.  We've got to get a house."

When you get this condition, you are VERY LIKELY to pay full retail price and make a decision you will later regret.

Anyone can catch "gotta-have-a-house" fever, but for some reason it really infects those who can't afford a house!  I'm talking about folks with debt up to the eyeballs, $4.13 in the bank, and behind on half of the bills.

Here are some ways to avoid catching "gotta-have-a-house" fever.

• Wait overnight before making a purchase decision
• Seek wisdom from someone who really knows about real estate
• Pray
• Save up 20% for a down payment – when you are really spending YOUR money, it changes the way you think about a purchase!
• Buy a house that makes you work on it day and night for five years because it was a ramshackle, low-down, termite-ridden, leaking, rodent-infested, soggy, sloppy, messy, butt-ugly trash hole.  This will certainly help make you immune to that type of purchase in the future.

Looking for additional Personal Finance Resources?  You can obtain free tools by clicking HERE and purchase books/materials by clicking HERE.

I constantly receive questions about where one should invest their money.

Many folks hear about investing in the stock market, and it all starts sounding like a bunch of gobly-gunk.  This is because of the huge quantity of options that are out there.

DISCLAIMER:  I am no investing specialist.  I don't sell mutual funds.  I am not an investing guru.  So go see your investing professional before you invest.

I thought today I would explain how I have invested in the stock market.

• I start with the company's plan.  The fees are cheaper and this is where the company match goes.
• Since I have a long time until I need the money, I split my investment choices into mutual funds that are highly focused on small, upcoming companies that have a lot of potential for growth.
• My current retirement investment split is about 90% stock/10% bonds.
• My retirement investment choices currently are about 30% International Stock Mutual Funds, 20% Aggressive Growth Stock Mutual Funds, 20% Growth Stock Mutual Funds, 20% Growth & Income Stock Mutual Funds, and 10% individual company stocks.

Now, the market has been on a run lately.  I am not able to predict market performance, but I have a long time until I need my retirement money.  SO, what is Joe and Jenn doing with their money?  Continuing to invest.  Every single month.  If the market goes down, we will continue to invest.  Every single month.