Rule #1: Do Not Lose Money
In his book The Richest Man in Babylon George Clason describes how someone could become wealthy by saving and investing 10% of his earnings every year. However, what was done with that money was very important. The vehicle for the money had to be safe. In the book he tells the story of one man who gave his money to someone pretending to be an expert investor and he never saw the money again. He was the Bernie Madoff of Babylon! So if you work hard to be able to put that 10% aside, the first rule has to be: do not lose the money. Or as he put it in step 4, “Guard thy treasures from loss.”
Their Investments Were a Waste of Time
Have you lost money in the market? You are certainly not alone. And yet, it may not be as bad as you think, for your investments are not what will create your wealth. Instead, look at the last lesson in Clason’s book: “Increase thy ability to earn.” In a study done at Harvard Business School that followed a group of people who wanted to become millionaires, they found that their investing was largely a waste of time. Those who did become wealthy did so not in the market but by continually increasing their earning potential. They made themselves more valuable and earned more, or they grew their business; ultimately their cash flow, not their investing, made them wealthy.
Rule #2: Refer to Rule #1
This bit of wit and wisdom is attributed to Warren Buffett, who detests risk, and has carefully built up a track record of strong returns. Yet even he, a full-time investor in the market, has lost money. So what can we do? Look for a place to put your money that cannot lose money, and yet has potential for making gains when the market goes up.
The Power of Zero
One solution that has these qualities is the equity-indexed annuity (EIA), which offers returns tied to a market index, such as the S&P 500. It also features a minimum return rate guarantee like traditional fixed annuities. In the past this minimum, or floor, was often 0%, and so the insurance companies used the phrase “the power of zero.” That is, when the market goes up, you participate in the gain. When the market goes down, your annuity holds it’s value. Now, however, many annuities have a floor not at 0% but somewhere between 1 and 3%. Indexed Annuities are popular with investors who want to benefit from the upside potential of the market without forfeiting the security of a guaranteed return.
So to follow the path of the richest man in Babylon – to guard and increase your treasure – consider indexed annuities as one vehicle to get you where you want to go.
Showing posts with label wealth. Show all posts
Showing posts with label wealth. Show all posts
Tuesday, October 13, 2009
Wednesday, August 19, 2009
Your Health is your own Choice
Make a Decision
How long do you plan to live?
What steps are you taking to get there?
And will you be healthy and wealthy, or decrepit and broke?
Placebos
The first thing that you need to realize is that you are responsible for your health. The mental attitude comes first, because all else flows from that. There have been too many placebo studies to have any doubt that our beliefs have a very powerful effect upon our health. Even medicine that itself is quite potent will often only be as useful as the patient thinks it will be. So you need to think healthy all the time. Picture yourself as completely healthy, and as acting only as a completely healthy person would act.
Action
The next thing you need to do is act on your beliefs – otherwise you will consider yourself a fraud and erode those very beliefs. Begin by moving more. Movement is the key to life. Muscles, blood, oxygen, and waste – everything needs to move. I have done Aikido, a Japanese martial art, where we move our bodies, our breath, and our ki (or chi/energy). In fact, in the East, they measure your health by the movement of your internal energy. When you are ill they say you have a blockage. So move. Take a walk. Climb the stairs. Do some gardening. Slow and steady is the safest, and will keep you living the longest.
Eating
Again, many studies confirm that you will live longer if you simply eat less. Digestion is the largest single expense of energy your body has to make during the day. We literally wear ourselves out with our large plates of food. Also, another handy guide to eating that is less well known is to compare the acidity and alkalinity of your food more than the calories. Your body and blood need to be slightly alkaline to make the most energy out of your oxygen. Foods like avocadoes and almonds may have a lot of fat, but they are alkaline foods, very healthy. Green foods are alkaline. Meats and dairy and breads are acidic foods. Eat them in moderation and make sure that you have a lot of vegetables and water to go along with them. If you are really serious, check out apple cider vinegar, the elixir of the Greeks, & favored by the Braggs.
How will you feel?
When you reach your target age, whether it is 75 or 100, how are you going to feel? Of course our health care system has serious problems – but what if every individual took it upon himself to think, act, and be completely healthy? It will be a small consolation when you end up feeble and diseased to be able to blame the poor health care system. Instead, take control of your destiny, and choose today to think, act, and live as healthy as you possibly can.
How long do you plan to live?
What steps are you taking to get there?
And will you be healthy and wealthy, or decrepit and broke?
Placebos
The first thing that you need to realize is that you are responsible for your health. The mental attitude comes first, because all else flows from that. There have been too many placebo studies to have any doubt that our beliefs have a very powerful effect upon our health. Even medicine that itself is quite potent will often only be as useful as the patient thinks it will be. So you need to think healthy all the time. Picture yourself as completely healthy, and as acting only as a completely healthy person would act.
Action
The next thing you need to do is act on your beliefs – otherwise you will consider yourself a fraud and erode those very beliefs. Begin by moving more. Movement is the key to life. Muscles, blood, oxygen, and waste – everything needs to move. I have done Aikido, a Japanese martial art, where we move our bodies, our breath, and our ki (or chi/energy). In fact, in the East, they measure your health by the movement of your internal energy. When you are ill they say you have a blockage. So move. Take a walk. Climb the stairs. Do some gardening. Slow and steady is the safest, and will keep you living the longest.
Eating
Again, many studies confirm that you will live longer if you simply eat less. Digestion is the largest single expense of energy your body has to make during the day. We literally wear ourselves out with our large plates of food. Also, another handy guide to eating that is less well known is to compare the acidity and alkalinity of your food more than the calories. Your body and blood need to be slightly alkaline to make the most energy out of your oxygen. Foods like avocadoes and almonds may have a lot of fat, but they are alkaline foods, very healthy. Green foods are alkaline. Meats and dairy and breads are acidic foods. Eat them in moderation and make sure that you have a lot of vegetables and water to go along with them. If you are really serious, check out apple cider vinegar, the elixir of the Greeks, & favored by the Braggs.
How will you feel?
When you reach your target age, whether it is 75 or 100, how are you going to feel? Of course our health care system has serious problems – but what if every individual took it upon himself to think, act, and be completely healthy? It will be a small consolation when you end up feeble and diseased to be able to blame the poor health care system. Instead, take control of your destiny, and choose today to think, act, and live as healthy as you possibly can.
Wednesday, August 12, 2009
Health Savings Accounts
Is a Health Savings Account for you?
A Health Savings Account can be a great option to consider as more and more employers are cutting back on their health care offerings. The health care industry also recommends that employees understand the true cost of their health care, and having to pay for more of their health care certainly is doing that. But a Health Savings Account is one way to take more responsibility for your family’s health care that has a number of benefits.
How it works.
An HSA can only be created alongside a high-deductible health insurance option. The idea is that the savings in your account will cover your first health care costs until you reach the deductible in your plan. The insurance companies can charge much lower premiums for the coverage because they don’t have to pay for all the small charges that fall under the deductible.
The benefits:
· The high deductible health plans save on premiums
· The HSA belongs to the individual, even when he changes jobs
· HSA contributions – and growth – are non-taxable
· Qualified withdrawals (for health care expenses) are non-taxable
· No limits to the amount that can accumulate in an HSA
· HSA’s roll-over; they are not “use it or lose it.”
· Employer and employee can both contribute.
· Contribution limits are released on June 1 every year, so you can plan ahead. And if you start mid-year, you can still contribute the maximum amount.
Healthy, Wealthy & Wise
Having more financial responsibility for your health often leads to making healthier lifestyle choices. And as you become healthier, your Health Savings Account could grow wealthier.
A Health Savings Account can be a great option to consider as more and more employers are cutting back on their health care offerings. The health care industry also recommends that employees understand the true cost of their health care, and having to pay for more of their health care certainly is doing that. But a Health Savings Account is one way to take more responsibility for your family’s health care that has a number of benefits.
How it works.
An HSA can only be created alongside a high-deductible health insurance option. The idea is that the savings in your account will cover your first health care costs until you reach the deductible in your plan. The insurance companies can charge much lower premiums for the coverage because they don’t have to pay for all the small charges that fall under the deductible.
The benefits:
· The high deductible health plans save on premiums
· The HSA belongs to the individual, even when he changes jobs
· HSA contributions – and growth – are non-taxable
· Qualified withdrawals (for health care expenses) are non-taxable
· No limits to the amount that can accumulate in an HSA
· HSA’s roll-over; they are not “use it or lose it.”
· Employer and employee can both contribute.
· Contribution limits are released on June 1 every year, so you can plan ahead. And if you start mid-year, you can still contribute the maximum amount.
Healthy, Wealthy & Wise
Having more financial responsibility for your health often leads to making healthier lifestyle choices. And as you become healthier, your Health Savings Account could grow wealthier.
Subscribe to:
Posts (Atom)
