Prove Them Wrong!

Andy Murray with trophyFor any tennis fans out there I know I’m not being a spoiler to tell you that Andy Murray won his first major tournament Monday when he beat Novak Djokavic in an amazing five set match at the US Open. There were plenty of people who thought he couldn’t do it, didn’t have the extra little something to be a champion. I confess I also felt that at times including Monday evening as I saw his decisive lead chipped away forcing a fifth set.

We all face naysayers and our own doubts, but the people who persevere are the ones who keep coming back, tournament after tournament, failure after failure. These people believe in something no one else does (at least it sometimes feels like no one else believes).

I have two stories relating to that which I’d like to share. The first takes place in the principal’s office of my middle school when I was in 7th grade. I was not a very good student back then. I rarely did my homework prompting many parent teacher conferences and frustrating my parents. My science teacher, Mrs. Gillen (I still remember her name), was also quite frustrated with me. On this occasion she took me to the principal’s office to try to talk some sense into me. I remember her words very clearly. She said that I needed to apply myself, get better grades or I was in danger of having Brain“my brain atrophy.” Mrs. Gillen then asked if I knew what atrophy meant. I did and defined it for her. I think she was as shocked with my knowledge as I was with her idiotic statement. I knew my brain was just fine and that my real problem was boredom.

Needless to say, my brain did not atrophy and I have gone on to be quite successful in spite of Mrs. Gillen’s dire predictions that I wouldn’t. The second story is much more recent and involves a very embarrassing  mistake on my part.

Two years after accepting a new job with an increased salary I noticed that I wasn’t being paid properly, that I was short several thousand dollars a year. Yes it took me two years to realize this – as I said embarrassing. The company’s response was “too bad.” Unless I could prove that I was being paid wrong they wouldn’t do anything about it. In one meeting an executive said to me “after all the nice things I’ve said about you to (the president of the company) what do I say now? AJ’s still a good guy but he’s apparently not good with money?”

MoneyI smiled because I knew that was so far from the truth that it was indeed laughable, and said, “Well that’s your opinion and you’re entitled to think what you want but that doesn’t change the fact that you aren’t honoring the agreement I entered when I took this job.” I was able to prove my case and got the back pay I deserved.

In both of those examples the people I was dealing with had very little confidence in me but I kept moving forward, working to improve myself and achieve the desired outcome on my terms. It is hard when you feel isolated but that’s exactly when you need your inner voice to come through loud and clear. I’m sure Andy Murray had doubts, was fearful and nervous, but he stayed focused and knew that a positive outcome was still very possible. The same goes for you in whatever is giving you pause right now.

It’s up to you to prove the doubters wrong so what are you waiting for?

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You Have More Than You Think

You have more time, money, knowledge, stamina, desire, influence and ability than you know. Those that recognize this fact are more likely to succeed.

You have the power!When faced with an impossible task you either rise to the occasion or you don’t. I think of the rare stories of people being lost at sea or while hiking, people who have survived difficulties none of us prepare for. These people found stamina they never would have imagined they had sitting in the comfort of their homes which means you have much more than you think as well.

There are everyday situations that require extraordinary commitment and focus, that many people either don’t have (I don’t believe that) or aren’t willing to put forth (all too common).

I’ve always considered myself entrepreneurial but I’ve been that way on my terms, meaning I’ve been somewhat conservative. My latest project has me taking on moreCash risk financially than I ever have and while it is daunting, I’m having the best time I’ve had in a long while. The joy I have from working harder than ever before comes from my confidence, I believe I’ll do well, and my sense of adventure, I want to explore my abilities and discover new strengths. These things, confidence and adventure, often lead to flow, a mental state in which a person in an activity is fully immersed in a feeling of energized focus and full involvement. In flow, times flies and before you know it, hours have passed.

So many people complain that they need more of something, more time or money but it’s there if they only look more carefully. You would be amazed how much money you could find if you just figure out where you’re spending it or prioritize things and give up the less important expenses that cost money but give you little benefit. You can find more desire by really exploring what it is you want to do, what you love to do, what excites you.

When we began our latest business journey, Julie was rightfully concerned that with our already busy schedules, we wouldn’t have enough time for this project, and that if we found the time, then we wouldn’t have enough time for each other. So far, I’m happy to report, we’ve found the time to devote to this adventure and, since we’re doing it together, we still have each other’s company – a win-win! But time is only one aspect and we’ve seen that we need more than we thought when it comes to money, knowledge (I’ve done more research for this than I ever did in college), and patience.

We need more of everything but it’s there if we’re willing to do what it takes to get it. In the case of money, maybe we have to give up somethings for the more important stuff and so we reduce discretionary things like cable tv or stop one type of investment in favor of another (which is what we’ve done).

As for time, this blog has suffered. I haven’t been writing new posts in a while but something has to give. As we move forward with this project I’ll blog more about it but that will happen when I’m finally ready to reveal this latest What Next. Stay tuned and check back here often (and explore – there are lots of posts with lots of good information if I do say so myself).

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When You Can’t Go Left Go Right

No this is not a political Left Vs. Right post. It’s about overcoming obstacles and setting yourself up for success.

Brick WallIn What Next A Proactive Approach to Success I write “When you cannot go right, go left. When you cannot go left, go right. When both left and right are not available, keep going straight. Whatever you do, keep going.”

There have been many times in my life when I’ve put this into practice. As I write this I can think of three examples that are just perfect for the concept of maintaining momentum in spite of obstacles. Each one is related to the other in that the decisions I made in one instance provided the option for other decsions.

A Big Life Change

Tired of my career in 2006, I began exploring the option of starting over in a field I not only enjoyed but was very good at, financial planning. Though I was a broadcasting major in college, I wanted to also major in economics but I simply wasn’t that ambitious at that time. In September of 2006 a much older and wiser me made the decision to pursue a change, spending a total of $7,000 over the next two years to study, take the CFP exam, and travel to two Financial Planning Association conferences. The first obstacle was starting a new career from scratch. I knew that this would be a big change so I dramatically altered my spending habits in order to save as much money as possible to make starting at the bottom less of a financial burden.

If there is anything I’m good it, it’s saving money, and I exceeded my goal, saving enough that even a 60-70% pay cut would not derail my lifestyle. One obstacle was overcome. When I began job hunting in my new career, I found nothing to fit the narrow, principled criteria I set for myself. Once I decided not to make the change the question of what to do with the money I’d saved came up. If I hadn’t planned well and saved for the possibility of a smaller income, I would not have had this next option. I decided to completely remodel and convert my three family rental property at the Jersey Shore to a two family home maintaining one rental unit.

A Personal Choice

Welcome to my second obstacle. My plans and the town’s zoning laws didn’t agree and with the prospect of spending thousands of dollars just to find out that I would be prohibited from making the alterations to the property, I dropped my plan. Another change of direction. The question of what to do with the money remained. That’s when a simple conversation with a friend in California led me to consider and then decide to buy a second rental property in California.

Becomes A Decision For The Future

The goals changed as I was able to navigate the barriers I encountered but my options expanded and that is the goal of any action, to increase your options for success. Like a game of chess you have to think several moves ahead and recognize how the actions of others will affect your path to victory. If you can do that while increasing your choices then you are on your way to success.

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The Calm After the Storm

HurricaneAfter a hurricane the weather is often beautiful, it’s the calm after the storm. Making a decision, particularly a decision that involves money and risk, you often feel you’re in a storm, being buffeted about in a sea of fear, concern, enthusiasm, confidence, and doubt.

I’m not yet ready to declare my decision final but while sitting on the train yesterday I was Beachovercome by a sense of calm, a sense that fear and doubt were completely vanquished. More than being calm, I was serene, totally comfortable with the decision I’m about to make.

I know it won’t last as problems are sure to arise because problems are a part of life, but I also know that during the worst of times I can have faith that the feeling of calm will return.

Do you have stories of calm after a storm? I would love to hear your comments below.

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An Optimist in a Pessimist’s World

The Optimist

Optimism sometimes feels so lonely.

I haven’t always been such an optimist. I remember dark days when I questioned life itself. Something changed and I became an optimist, a confident believer that if you think you can do something then you can. Do you believe that? Please tell me there are other people like that out there, please.

If anyone reads a prospectus for a mutual fund (not exactly beach reading material) they would see the statement: “Past performance is not an indicator of future performance.” No one really cares. They buy the fund anyway. When it comes to me, however, it seems people believe a variant of that statement: “Past success is not an indicator of future success.” I wonder why that is?

In spite of all my optimism I’ve never proven myself reckless, thoughtless, impulsive, or irresponsible. Many believe I have taken risks but as Scott Loughmiller points out in What Next, I don’t take risk, I manage risk. Taking risk is being impulsive but managing risk is gathering all the information possible and then making an informed decision. The thing with information is that the one piece everyone wants to know can’t be known, the outcome.

I have failed in some ventures, I did not successfully make the career transition to financial planning (in spite of passing the rigorous CFP exam) and I did not become a best selling (or much selling) author. Those two items carried a relatively small financial burden. The plans and schemes I’ve had that involve large amounts of money have all done well.

Of the few ventures I’ve gotten involved in I have turned down many, many more. That means I decided the risk was too high, that I didn’t have all the information I wanted or needed. Past success really isn’t an indicator of future success but sometimes it feels like I’ve never done anything right.

Anyone else have that experience? Let’s get the optimists support club going!

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ChangeMy latest newsletter The What Next Trail-Map to Success is out and the topic this week is change. I used this image for the newsletter and started to think of the link between actual change, coins, and change in our lives.

I like change, both the physical coin type and change in life. Each day I put the coins I’ve gotten into a jar and once it’s full I cash it in. It usually takes two to three years to fill up the jar. Not all change is immediate. My pockets fill up first, then I add to the jar. The growth I see as the money rises to the top is satisfying because I know I’m making progress. Change can be measured.

Some change is small, pennies for example, or the decision to dress better for work. Some change is a bit larger like a nickle or dime, decisions that bring you closer to your goal a little more quickly. Then there are the big changes, the quarters of life, the decision to leave your job or to start a business. These are the changes I like but as I’ve pointed out many times in my book and in previous posts, this is the change most people think is crazy or too risky.

Every once in a while I’ll get a dollar coin. I’m never quite sure what to do with those. Do I put them in the jar and wait until I cash it in? It would sure make the total higher if I did that. Maybe I’ll hold onto that and use it since it’s a fairly large amount, why wait? I do both, sometimes I put the dollar coins in the jar sometimes I keep   them. I don’t need change for change sake, I rather the change serve a purpose and that’s my goal in life.

I’m in the process of investigating a change, a big one, and as I’ve noted, Julie isn’t really on board yet. Julie handles her coin change differently, choosing to spend it rather than using bills and getting more change. And there we have the difference I want more change and she doesn’t.

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Trading Up

The headline today (May 2012) read “Housing Market Recovery Gains Traction.” I guess that’s a good thing. It’s certainly good for anyone trying to sell a house or hoping that it will at least be worth what they owe on it. I suspect we’ll see more of those stories as time goes on and eventually (probably not for a very long time) we’ll see that home prices have surpassed their 2006 peak.

Don’t get too excited because, human nature being what it is, I’m sure people will fall right back into the trap of bad habits.

I wrote the piece below for a previous blog I ran in March 2006 (before the collapse) about why owning a home is a danger for some people. As long as you don’t get caught in this trap, you’ll be fine.

Trading Up

My parents have owned the same house for more than 30 years. My cousin owned her home for 40 years, raised her children in it and one of those kids will probably live in that house after she’s gone.

Modest HomeHave you ever heard of a mortgage burning party? Well, it used to be that people would buy a house and live in it until they died, working year after year with one goal in mind, paying off the mortgage. When the day finally came and the mortgage was paid off the homeowner would burn the mortgage as a final act of freedom. It was a significant event.

This has become rare these days as people continue trading up to ever larger homes with more amenities that end up costing more to maintain. It’s theBig House common roadblock to wealth – status.

It’s not a conscious thing. We don’t wake up one morning and say “I’m going to put status over saving today.” But when it comes time to buy something major like a car, you probably want the newest model with the most amenities and biggest engine. If you could get a Mercedes or BMW you would.

It’s the same with a home. You’re probably going to stretch to afford the most you can and, in time, when your financial picture brightens and you’ve built up some equity, you’ll want to upgrade. Never mind that you already have rooms that are rarely used or that it will cost more to heat and cool the house. No, you want a bigger house so that you can impress friends and family. Like I said, this might not be a conscious decision but if you would just ask yourself the question “is it really necessary for me to move” you’ll be surprised at the answer.

We do this all the time. Do you really need that new DVD? Do you really need that new grill or would a bit of cleaning work just as well and save you hundreds of dollars?

Yeah little things add up but big things add up quicker. So stay in your current house a bit longer. Keep that car for a few years after you finish the payments. It may be a subconscious thing, seeking status, but you can make a conscious effort to fight that urge and do more by spending less.

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Financially Bipolar

When I decided to buy my second rental property I made sure to run all the numbers, consider many scenarios, and set up plan B, C, and D in case things went wrong. I was confident that this was a good idea, my wife, Julie, on the other hand, Tug of Warwasn’t convinced. We do that a lot, counteract the other’s enthusiasm and that’s a good thing.

What’s really funny is that at some point in this decision and others of this Swappedmagnitude, we swapped. Julie suddenly became confident that this risk was worth taking and I became very uneasy. I began to wonder if some other investment would be better and less difficult to handle. Julie laid out the reasons why the rental property was a better idea.

That’s when it occurred to me: we’re financially bipolar, swinging from mania, we can do this, to depression, this will never work, and back again. The fact that we do this on completely different schedules is funny (and really weird).

I think more people should be like this. It’s an excellent check before making a decision that could have dire consequences. If many folks, even trusted experts, had done this before buying a house they really couldn’t afford, they might not have been in as bad a situation as they were or still are.

Stop and ThinkBeing financially bipolar gives me the ability to stop myself from being impulsive, it forces me to think through a decision as I am my own skeptic and my own cheerleader. It also means that sometimes I worry about a twenty dollar purchase one minute but want to buy another rental property the next. That’s where Julie comes in to balance me.

What it comes down to is a conscious choice to consider a different perspective, something not many people seem open to doing these days.

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Wealth Builder Carnival #75

CashGathering articles on topics such as Earning, Investing, Living Frugally, and Taxes, Super Saver (who I talked about in this post) presents the Wealth Builder Carnival #75. Super knows a thing or two about building wealth since he set the goal of retiring in his 40s and accomplished it. The articles in each edition of this carnival will educate you about finances and set you on the path to building wealth. You have to take action, click over, and read the articles for any of the advice to work.

The article that Super included from me is called Functional Financial Illiteracy. There are many more excellent posts to read so what are you waiting for?


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You Can Retire Early


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Retire SunsetHow do you think about retirement? Is it something that’s too far off to worry about, or too close to deal with? Is retirement something you feel ready for or scared about? Do you want to retire early or will you have to work longer than you want?

In yesterday’s post I wanted to turn the cliché “Money is the root of all evil” on its head and I came up with some suggestions such as money is the root of self-confidence, independence, and security. The fact is, money is a means to an end, it’s just a tool to use.

Retirement is thought of as an escape from work, from responsibilities, from the rat race or the grind, but retirement is none of those things if you are ill prepared without enough resources, otherwise known as money.

I know that early retirement will be a reality for me (whatever retirement means for someone who asks What Next). But what is early retirement? If 65 is “normal” retirement is 60 early? How about 55 or 50? My goal is 50 but is that really possible? And how?

The answer is yes it’s possible and I present “Super Saver” as exhibit A. Super is a blogger who retired in his 40s and, as I indicated yesterday, he didn’t use any get rich quick schemes, there were no tricks, and he doesn’t have a system he’s selling to teach you how to do it.

There are three key points to how Super retired so early and how I plan on doing the same: First, he started young and got a good education in a field with potential for good income. Not every career has the same potential for high income but you have to accept that fact if you choose to take a job because you love what you do rather than for the money. As a student you should also think twice about how much debt you’re willing to take on for a job that doesn’t pay well.

Second, he knew that hard work in the short term would lead to options in the long term, he was able to advance in his career getting raises and promotions along the way. I, too, have worked long hours and pushed hard to achieve certain goals at work but I know I won’t be doing this forever.

Third and probably most important, he was able to restrain himself and live significantly below his means. No matter how many times people hear this advice, live below your means, they simply don’t listen. Yes my wife and I have a very good income but we also save a large amount. Super says he saved 10% of his income in the early years but I don’t see how much he saved later. Julie and I save an astonishing 27.7% of our income, on average, over the last 6 years.

Wealth Builder PostsSuper wrote an excellent series of posts recounting exactly how he was able to retire in his 40s and I highly recommend reading all 10 posts.


So many people ask, wonder, and dream of retiring early without realizing that they have the resources to do it if only they were willing to give up some immediate pleasures for the future promise of their dreams.

It comes down to choices. Do you have what it takes to make the right choices now for a better future?

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