Category Archives: Motivation

Debt: Reaching Step Zero

The first step in correcting a problem is to admit that there is a problem.  Prior to admitting that there is a problem, there is another step.  That is when a person reaches their breaking point and cannot go on living the way that they are living.  That is often referred to as step zero.  Step zero is when a person says to themselves “this crap has to stop”.  It is the breaking point.  It is the point where a person becomes willing to take corrective action.  They become willing to try a different approach of living because of a psychic change.

Have you reached the point where you realized that your way of managing money is not working?  Are you spending more than you earn?  Does all of your earnings go towards paying bills?  Do you have creditors calling you who want to be paid?  Do you have to borrow money when an emergency occurs?  Do you find yourself spending money that you do not have in order to keep up with your friends, neighbors, or relatives?  Do you feel broke even though you work hard and earn a good income?  Do you contribute any money to your retirement savings accounts?

Have you reached step zero? Do you want to change how you manage your finances?  Do you want to take control of your life?  Do you want to break away from the bondage of debt?  Are you at a point where you are totally dissatisfied with how you are living because of debt?

The good news is that there is hope.  It can get better.  It is all up to you.  It is based on your willingness to change.

Now that you have admitted that your way of managing your finances does not work, how should you start the mending process?

Measuring the Damage

Start by measuring the damage that you created.  Before you can move forward, do an analysis of what you owe.  My favorite tool to assess debt is the debt-to-income ratio.

To calculate your Debt-to-Income Ratio, see the formula below:

Debt-to-Income Ratio = Monthly Debt Payments/Monthly Income x 100

Example: $1000 in Monthly Debt Payments/$3000 in Monthly Income x 100 = DTI of 33%

What is considered a bad DTI Ratio?

If your DTI Ratio is higher than 36%, you are in the danger zone.  The higher your DTI Ratio is, the less money you have to cover your living expenses.  A healthy DTI Ratio is less than 16%.

Where to Start

After you know your DTI Ratio, it is time to start paying down that debt.  Start with paying off all of your bad debt.  Pay off all of your payday loans, credit cards, and auto loans.  Next, start to pay down your student loans, mortgage, and business loans if they exist.

Stop the Bleeding

Stop buying stuff you do not need on credit.  Identify what you need and only pay cash for those needs.  A few examples of needs are food, clothing, medical supplies, transportation costs, and housing expenses. Wants are fancy cell phones, cable TV, designer clothes, eating at restaurants, or any other expense that is not required to live.

Income

If you are part of a dual-income household, learn to live off of one salary.  Use the higher of the two salaries to pay for all of the household living expenses.  Use the lower of the two salaries to pay down debt.  After your debt is paid off, you can start to focus on saving money.

Get a second job.  Find a side gig to earn money to pay down debt.  If you spend your free time working, you will be less likely to spend money on stuff you do not need.

Create a budget.  A budget is a plan that allows you to break down where your earnings will be allocated based on a percentage.  For example, 25% for housing, 11% for transportation, 20% to pay off bad debts.  Once you have a budget established, all you need to do is follow it.

Recreation

Even though you have debt, you still have to live your life and have fun.  Find ways to enjoy what your local community has to offer.  Instead of going to high priced movies or amusement parks, go to local parks or free museums.  Instead of going to a high priced gym, exercise outside by walking.  Instead of going on a luxurious vacation, take a staycation.

Guilt & Shame

There is no use in feeling bad about having debt.  You have identified the problem.  Now is the time to move ahead and to make positive changes.  Having ill feelings is not a solution.

Focus on the positive and on everything that is possible once your debt is under control.  Try to take small steps and to monitor your progress.  Don’t strive for perfection.  If you have a slip, don’t beat yourself up.  Pick yourself back up and keep striving for progress.

Conclusion

Debt is similar to hiking.  Once you walk 5 miles into the woods, you have to walk 5 miles to get out.  Now that you have decided that a change is needed, it is up to you.  At this point, there is no use in looking for someone or something to blame for your debt.  You cannot change the past.  You can just pick up what is left and apply a solution.  If you learn from the situation, it was not a waste.  As you move forward, you can also use it to help other people who are struggling with their own financial issues.

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Be Intentional

I recently attended a leadership training seminar at a local college.  This seminar was about managing the multi-generational workforce.  The facilitator covered many topics and I am not going to get into any of those details in this post.  He said many interesting things, but the one statement that made me think was that he said that we should always be intentional.

Everything we do should be with intent.  Our actions should have an intended outcome.  Our words should have an intended message.  Even our thoughts should be focused and have a purpose.

The purpose of this training was meant for workforce development.  The message can easily be applied into everyday life.  It is ideal for managing money.

Too many people just coast in life.  They walk around making noise and bumping into things.  By not having a plan, they will just land at a random destination.  What could possibly go wrong with that approach?

To be successful in all your affairs, practice being more intentional.  A great place to start is with how you manage your personal finances.  You should know the why behind everything that you do.

Savings

Do you know what your savings rate is?  You should be able to answer this question without giving it any thought.  Is it 10%, 20%, or more than 30%?  Your savings rate is the most important factor that will determine if you will reach financial independence or not.  It is also one of the rare aspects that you have control over.  Nobody can control what the S&P 500 will return this year, what direction interest rates are headed, or if there will be a spike inflation.  Everyone, however, can control what their saving rate is.

Spending

Your savings rate is directly impacted by your spending.  Do you just spend money without thinking?  Do you go to the mall, outlets, or online and buy things that you do not need?  If you want to change this trend, become intentional with your spending.  Before you buy something, ask yourself if you need it or truly want it?  If you must spend the money, did you shop around for the best price?  Is there a low-cost alternative to making the purchase?  Even if there isn’t a better alternative, at least you did your due diligence and gave thought to the purchase.

Debt

Does your credit card bill arrive, and you cringe when you look at your balance due?  Do you make late payments or just pay the minimum balance on your credit cards?  Do you know what your credit score is?  Do you know what your debt-to-income ratio is and what a healthy ratio should be?  Do you know how to calculate your debt-to-income ratio?  If you want to improve how you manage debt, take a more intentional approach.  Learn what your credit score is, identify if you have too much debt for what your income is, and ultimately establish a plan to get out of debt.

Earnings

I bet you know what your annual salary or hourly wage is?  You get a paycheck every week or bi-weekly, so you are reminded frequently about that rate.  Do you feel that you are underpaid?  Doesn’t everyone?  Maybe you are underpaid or maybe you are overpaid.  Before you ask for a meeting with your supervisor demanding a raise, you should do your homework.  Be intentional and research what the market rate for your position is based on your location and level of experience.  If you are under market rate, you might have a case.  If you are over market rate, but not satisfied, you might need to develop more skills or ask for a more challenging assignment.

Investing

If someone asked you what type of investor you are, could you answer them?  Are you a market timer?  Do you buy and hold equities?  Are you a passive investor who invests in a few different mutual funds?  Do you simply try to capture what the market returns with a total stock market fund?  Do you use value tilts?  Do you buy dividend stocks?  Are you trying to get rich by investing in Bitcoin?  You are free to decide how you invest your money, but you should know the why behind your plan.  Your approach to investing should be intentional.  Nobody knows what the future market returns will be, but you should at least know what you are intending to accomplish with your asset allocation.

Financial Independence

Do you know how much money you need to have in savings to reach financial independence?  To declare financial independence, the general rule is to have 25 years worth of living expenses in savings.  That is based on a 4% withdrawal rate that most financial professionals consider to be acceptable.  Do you know if you have obtained this milestone or how close you are?  Most people who reach financial independence do not get there by accident.  They live intentionally for many years.

Early Retirement

Do you have a target-date as to when you want to retire?  It might be next week, or it might be in 10 years.  If you have an established early retirement date, what are you doing to make that goal a reality?  Are you doing everything you can to maximize your salary and taking on side gigs?  Are you saving until it hurts?  Do you have the right mix of investments to both reach your goal and sleep comfortably at night?  If you do, you are acting in an intentional way.

Conclusion

The nice thing about being intentional is that you can start this process now.  Start by reviewing your current financial situation.  Can you answer why for all your financial decisions?

If you have a financial plan, use it as a guide.  If you do not have a written plan, write one.  That is a good starting point if you want to become intentional.  Review your plan for areas of your financial situation that might need to be amended.

Some fixes are quick, and others require time to implement change.  Moving forward, wherever money is concerned, ask yourself why before you make a final decision.  If you cannot answer why you are doing something, give it some thought and find out what your true intentions are.

This is just another example of how to improve your financial situation.  It provides a pause before you act.  Sometimes giving a decision an additional few seconds of thought can turn a bad decision into a good decision or a good decision into a better decision.

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Financial Unmanageability Transcends Money

When it comes to finding ways to better manage your finances, there are unlimited resources.  There are many great books, blogs, forums, websites, and apps.  There is not a shortage of information, tools, or even professional services.  If a person wants to make improvements when it comes to spending less, paying down debt, saving more of their earnings, or learning to invest, they could find out how to do it in a matter of minutes by doing a few simple online searches.

If the solution to finding ways to improve your financial situation is so readily available, why are so many people struggling?  Yes, we can blame the marketers for always trying to sell the newest gadget.  That excuse, however, only carries so much weight.  Consumers are more educated than ever and many tune ads out.

What if the problem is more pervasive?  What if the problem is beyond simple behavior modification? What if the problem is based on unmanageability?  Yes, the inability to have mastery over your life.

If the problem is based in unmanageability, there is not a blog or app to solve the problem.  If your life is truly unmanageable, trying to get a better handle on your financial shortcomings is just treating a symptom.  To gain control of your life, it will take a little more than spending less and saving more.

Denial

Nobody truly wants to admit their life is unmanageable.  Just like nobody wants to admit they drink, spend, eat, or gamble too much.  It is natural for many people to think, I don’t have an issue with my finances and then go spend more money.  It is common behavior for people who have addiction problems or a spiritual malady to deny what the problem is.  The thought process is like a broken record that skips the same verse over and over.  I do not have a problem with my finances – go spend more money.

Resentment

To resent is to keep going back to a negative feeling.  Instead of feeling and processing those bad or negative feelings, you spend money.  Resentment is not always based on harboring ill feeling towards someone who you believe wronged you in some way.  Resentment can also be rooted in harboring ill feelings towards someone who did exactly what you expected them to do.  The problem was that you were still not satisfied.  They were unable to fill that void that exists within you.  To find temporary relief, you continue to spend and try to fill that void with an external fix.  Unfortunately, it does not last.  After you exhale out and feel relief, you almost immediately inhale the resentment back in.

It is All About You

When you live an unmanageable life, there will always be a conflict with self.  It is all about you.  You cannot be of real use to others.  Sure, you might be physically present in their life, but are you truly living in the moment?  Or are you just physically there, but mentally bound to your troubles?  When your self-centered thoughts and feelings are the focus of your existence, it is difficult to make meaningful connections with others.

Anxiety 

You are not a bad person.  You might even do nice things for others.  You believe that you are thoughtful and caring.  You spend money on the people you care about and on those who you want to care about you. Externally that all might be true, but aren’t you just doing all those things to find more relief and to feel better about your current state of unmanageability?

Do you live in fear?  Do you spend more than you earn and panic when the bills arrive?  Do you lay awake at night and worry that you will never be able to get out from under all the debt you are in?  Do you see retirement as a possible option for others, but something that you would never be able to afford?  Do you obsess over your finances in one thought, but follow it up with more spending that pushes you further away from having healthy finances?  Do you feel hopeless?

Is this fear leading to other health concerns?  Is it leading to weight gain or panic attacks?  Have you gone to see your doctor because you feel overwhelmed?  Did your doctor put you on meds to take the edge off and to help you cope?

There is a Solution

Yes, getting your finances in order is great, but you first need to get your mind right.  I am not a therapist.  I am just a guy with a personal finance blog.  If you are honesty suffering from the symptoms that I listed above, you should seek outside help.  Find out if your health insurance covers visits to a psychologist without a referral from your primary care doctor.  If not, ask your doctor for a referral to one that they recommend.  You might have to pay a low co-pay, but it will be worth it.

There are also 12-step programs.  As I stated earlier, your spending might be just a symptom of a larger issue.  There are 12-step programs for spending, gambling, drinking, and just about any other type of obsessive disease.  It is up to you to dig deeper and decide if you think a 12-step solution would be a good fit for you.

Conclusion

Don’t beat yourself up.  Don’t wallow in guilt, shame, remorse, or any other negative feeling.  The past is the past.  It is time to move on.  Pick up the pieces.  You are not a bad person.  You might have made poor decisions and you might suffer from the disease of addiction.  After you put your own house back in order, you can make amends to those you feel you might have harmed including yourself.

There is hope.  There is also help available.  It is now up to you to find the right help that will be a catalyst for positive change.

Once you get your mind right, great things will start to happen in your life.  Not only will your financial situation improve, but every area of your life will get better.  How could it not, you will be moving away from the problem and in the solution.

You will be able to better accept people and situations as they are.  You will be able to let go of the past. You will better assimilate into the mainstream of life.  You will become more useful to the people around you.  You will finally find the peace that you have been searching for all along.

As a bonus, you should be able to better budget and save money.  Your whole life will become more manageable.  Having a few more bucks in the bank will just make life more enjoyable.

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Joining a Board of Directors

Have you ever thought about joining a board of directors for an organization that you are interested in serving?  I recently was invited to join the board of directors for a local non-profit organization.  It was flattering to be invited.  Of course, I jumped at this opportunity to be of service.

My wife has always been involved in community and church service.  Slowly, her good nature has rubbed off on me.  Over the past few years, I have volunteered to help the clients at the local chapter of The ARC to prepare for job interviews.  It is such a rewarding experience.  When I finish with a lesion, I feel that I receive back more in gratitude than they receive in development.

By joining this board, I see it as an opportunity to give back more to the community.  The board that I joined is for The Mature Workers Program that is part of the National Council on Aging.  It was a good fit for me since I work in HR for a not-for-profit healthcare organization.

There are many benefits of joining a board of directors:

Career

Joining a board of directors is a smart move for your career.  It looks great on your LinkedIn profile.  It shows that you are service orientated.  By being on a board of directors, it reflects that you are a well-respected individual by people of influence.  It shows that you see the big picture.  When a potential employer sees that you volunteer as an advisor, they interrupt it as that you want to contribute to something that is bigger than yourself.  Those are all great characteristics that might not normally stand out on a standard chronological resume.

People of Influence

Many boards attract people of influence.  It is common for boards to be made up of lawyers, executives, community leaders, business owners, and other financially independent people who are passionate about an organization or cause.  It is an opportunity to meet and interact with these folks.  It is a chance to partner with them and work to improve the organization that you now help to oversee.  It is a networking opportunity that is not readily available to everyone.  By closely interacting with these individuals, there is the potential to develop close relationships with them because you share a common bond.  Work to foster those relationships.  You never know how or when those connections can be helpful in the future.

Community Pride

Do you care about the area where you live, an organization, or a cause?  By joining a board of directors, you are able to have input.  Today, everyone has an opinion, but by being on a board of directors, you have an option that matters.  It is an opportunity to become a community leader and to develop an abundance mindset.  Even if it is on a small level, it is still a trusted role.  It is a position where people care what you have to say.  Everyone might not agree with you, but you still have a voice and a vote when it comes to the management of the organization that you serve.  It is truly a position of respect.

Leadership Skills

Being on a board of directors will help to develop you into a leader.  You will have to review and approve of budgets.  You will have input when it comes to shaping policy.  You will be presented with the goals of the organization and how management is working to reach these goals.  As the member of a board of directors, you are responsible to lead and to present input that shapes the best practices of the organization.  Your negotiation skills will be sharpened.  You will learn true team building skills as you work with other board members to shape the future direction of the organization.

How to Join

In most cases, you must be invited or elected to join a board of directors.  There are organizations, however, that are looking for people to join.  First, do research on organizations that you are interested in.  Try to identify organizations that have a mission, vision, and values that you feel strongly about.  Do some deeper digging and find out if you have any connections to the organization.  Use LinkedIn to identify possible connections.  Share your interest in the organization and look for ways to volunteer.  After you learn if the organization is a fit, make a formal request to join the board or to be nominated if the selection is based on an election.

Conclusion

The organization that I am now on the board of directors for wants to increase the number of clients that they serve.  They have an adequate marketing budget.  They run television ads, radio ads, and attend most community events where people over the age of 55 might attend.

At my first meeting, I suggested that they allocate some of the marketing money towards social media and brought up the idea of creating a blog.  The suggestion went over well.  It is going to be added as a topic for debate and to be voted upon at a future board meeting.

I have truly enjoyed my short experience serving as a board member.  It feels good to be able to give back.  It has been a privilege to volunteer my time.  I am looking forward to future board meetings and for the opportunity to be of service.

Have you ever served on a board of directors?

If yes, please share your experience.

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My First Year as a Personal Finance Blogger

My blog just celebrated its first birthday.  The Financial Journeyman was launched on April 8, 2017.  Time sure does go by quickly when you are having fun and interacting with great people.

When I launched this blog, I had very low expectations.  My expectations were low because I never created a blog before.  After I decided to create this blog, I did some research on how other blogs performed during their first year.

Many of the general posts that I read about initial blog traffic stated that traffic will be slow in the beginning.  Some bloggers wrote that they received zero traffic for months.  For some, the only person who read their blog was their Mom.  That had me worried because I knew that I would be in trouble if I had to rely on my Mom to read this blog.  Joking aside, I knew that creating a blog was going to take a great amount of time, effort, and some money.

Before I created The Financial Journeyman I never interacted on blogs or forums.  They have always been useful sources of information.  My approach was just to visit, read, and move on.

That approach had to change.  I did not know anyone in the Financial Independence Community.  To meet people and make connections, I had to start interacting with people who were sharing about their personal financial situations on various online platforms.

In a sense, I felt like the personal financial blogger who came in from the cold.  This blog was not about tracking a transformation that followed a psyche change about money.  I was already saving and investing for 20 years, close to being financially independent, and planning on retiring in 2028.

The Financial Journeyman was created to share what I have learned along this journey.  It is written for those who want to achieve financial independence first and then plan for an early retirement.  The content is for both beginners as well as for those how are already taking the required actions to make their own financial goals a reality.

Social Media

Since my blog is anonymous, Twitter seemed to be the best option to start with.  I keep my blog anonymous because I talk openly about my financial situation.  There are some people like my boss and extended family who I do not want to know about the details of my financial situation.  The other reason is that I do not want to be robbed.  I read the book In Cold Blood by Truman Capote at a young age and I suggest it to anyone who has considered sharing about their wealth without protecting their identity.  Twitter has been a great tool for growing traffic and interacting with other bloggers.  In my first year, my list of followers has grown to over 2,700 people.

The Financial Independence Community

Rockstar Finance has been an invaluable resource.  I have had three posts featured in the past year:

How the Mob Influenced My Asset Allocation

Keep Your Hands Off My 401K

Funding Retirement with the Bucket Approach

J. Money was kind to me and greatly helped to get my blog some traction.  ESI who now owns Rockstar Finance is also a good guy and featured me as M25 in his interview series about millionaires. Being featured on those sites truly helped to get my blog some needed exposure among 1,500 other personal finance blogs.

Guest posting is also important for new blogs.  It is a way to get introduced to new readers.  My first guest post was on My Millennial Guide.  Over the past 12 months, I have written guest posts on several websites including Chief Mom Officer, Keep Thrifty, Abandoned Cubicle, and for Michael Dinich.  All those posts have helped introduce me to new followers.

It is fun to meet people and chat online.  For me, however, I like to meet people in person.  It is fun to hang out and talk with people who share the same passion for financial independence.

In the past year, I have started attending my local Bogleheads Chapter Meeting in Philadelphia, Pennsylvania (120 miles away).  At that group, I have had the opportunity to meet some nice people who welcomed me to the group.  At the most recent meeting, I had the opportunity to meet Erin Arvedlund from the Philadelphia Inquirer.  Erin Arvedlund might not be a familiar name, but she was the original journalist who broke the Bernie Madoff Ponzi Scheme story while working for Barron’s Magazine.  Yes, she is the real deal.

In November, there was a Rockstar Finance Meet-up in New York City.  This was a chance to meet some of the best personal finance bloggers who live on the East Coast.  At this event, I had the opportunity to meet Stefanie O’Connell, Josh Holt from Big Law Investor, The Luxe Strategist, and Liz from Chief Mom Officer.  At that event, I also met another Pennsylvania Guy named Church who blogs at My Mattress Money.  Like myself, Church is a big Philadelphia Eagles fan.  He and I frequently chat about the Eagles and message each other during the games.  It was fun to root for the eagles together on their way to a Super Bowl victory.

It seems like I am making new friends every week.  A short while ago I was able to meet a financial blogger who lives near me.  I had the opportunity to have dinner With Michael Dinich.  Michael is a financial professional as well as a blogger.  He is a generous guy.  He and I are currently working on a few collaborations together.

My most recent financial meet-up was the ChooseFI meet-up in Philadelphia.  There are many outstanding financial podcasts, but ChooseFI is one that I tune into almost every week.  It was fun to expand my circle of friends even more.  I had the pleasure of meeting Kait who blogs at Not Your Average Millennials. This was a very friendly and welcoming group of people who are working hard to reach financial independence.  I am looking forward to hanging out with this group again.

People might think I am crazy to dedicate a whole Saturday to drive to these big cities to talk money with strangers.  If I was not passionate about it, I would not do it.  If I want to make new friends and expanded my reach, I need to put forth the effort and go to them.  It is not different from any other personal or professional relationship.

Writing

This post is about a blog, so I guess I should touch on writing.  My advice is simple.  The first post is the hardest.  I thought about creating a blog for a very long time.  I decided that I did not want to one day reach old age and look back and wish that I had written.

It is a craft.  It takes practice.  It is difficult, but I am striving for progress.

Reading makes writing easier.  You might be a personal finance blogger, or you might blog about something entirely different.  Read other bloggers that are in your space.  Read books, journals, and forums too.

Just keep writing.  Dedicate some time to write every day.  The more you do it, the easier it becomes.

Blog posts are short.  Even longer 3,000-word blog posts are short compared to a book.  I have found that diction is super important in blog posts. It is crucial to be as clear as possible.  As a personal finance blogger, the logic is the easy part.  The difficult part is capturing the ethos and pathos.

Finding Balance

I post about 5 times per month.  This is a part-time blog.  On top of managing this blog, I have a full-time HR job where I manage the Recruiting for four different healthcare campuses in two different states.  That job eats up a good chunk of my time and energy.

Every morning, I try to dedicate about 45 minutes for reading before work.  Every evening, I dedicate at least one hour for writing and editing posts.  My time is limited, so I need to be efficient.

Blog Performance Metrics

So, how has this blog performed over the past year?  The Financial Journeyman was raked as the 15th fastest growing personal finance blogs over the past year.  That statistic truly humbled me.

This is the third post about performance metrics that I have written.  If you want to see some of the early stats, I wrote a six-month as well as a nine-month review.  Below are some of the metrics for the 1st quarter of 2018 as well as my total metrics for the past 12 months:

January 2018

  • Sessions – 1,050
  • Users – 724
  • Page views – 1,859
  • Pages/Sessions – 1.77
  • Average session Duration – 1:23
  • Bounce Rate – 71.14%
  • Number of Sessions per User – 1.32

February 2018

  • Sessions – 980
  • Users – 753
  • Page views – 1,699
  • Pages/Sessions – 1.73
  • Average session Duration – 1:38
  • Bounce Rate – 69.59%
  • Number of Sessions per User – 1.30

March 2018

  • Sessions – 3,956
  • Users – 3,289
  • Page views – 5,370
  • Pages/Sessions – 1:36
  • Average session Duration – 1:09
  • Bounce Rate – 84%
  • Number of Sessions per User – 1.20

April 2017 – March 2018

  • Sessions – 16, 537
  • Users – 12,300
  • Page views – 25,454
  • Pages/Sessions – 1.54
  • Average session Duration – 1:17
  • Bounce Rate – 76.74%
  • Number of Sessions per User – 1.36

Conclusion

There you have it.  That was what it is like to be a blogger for one year.  It is now easier than ever to create a blog.  If there is a subject that you are passionate about, you owe it to yourself to write.  You also owe it to others.  People want to read about what you have to offer.  It is a therapeutic process.  It is hard but rewarding.  It is your opportunity to share with the world. People want to read about an experience, direction, and what is possible for them to achieve.

It has been a pleasure to share this year with all my readers.  I am looking forward to an even more exciting second year of blogging.  When it comes to personal finance and especially investing, we do not know what is coming next.  That is why it is important to have a plan and find trusted resources that you can stick with.  My goal is to be one of those trusted resources for you.

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Should Millennials Contribute to a 401K?

No, that is not a rhetorical question.  I was having lunch the other day with my co-worker Jill.  Jill is an exceptional young woman.  Jill’s parents divorced when she was young, so she grew up in a broken home.  That did not stand in the way of her excelling in school.  She went on to earn a BA in Psychology from one of the best state universities in the country.  She is also considering going back to graduate school for a Master’s Degree in Public Administration.

Jill and I have worked together for almost one year.  Jill was lucky because she was hired just a few months after she graduated from college.  She is a great employee, person, and is highly ambitious.

She told me that she developed her work ethic as a young teenager.  She said that growing up without a dad around, she had to work to help her mom pay the bills.  Jill started working at age 14 and has always had a job during high school and while in college.

When we were talking, she told me that when her parents divorced they had an agreement to give each child $40,000 towards their college education.  Her brother went to Notre Dame and the money he received from his parents covered about one year of his education.  Jill opted for a state university that was only a 2-hour drive away from her Mother.

Jill’s education cost her parents $30,000.  Her parents tried to be fair about the dollar amount.  After graduating college, her parents also bought her a used car for $10,000.  Even though she did not get to watch the Fighting Irish play football in South Bend, she still made out well.

During our lunch, she told me that she feels bad for her current roommates.  Most come from families that are more affluent than her family. However, they all have student loan payments that cost $700 or more every month.

She asked me my opinion about her situation.  Should she feel bad?  What should she do with the extra money she has compared to what her roommates have?  She said that she did not grow up with much and does not want to waste it.

I told her that she is in a fortunate situation.  She has a unique opportunity to save a great amount of money since she does not have any debt and her only large bill is her monthly rent.  I suggested that she pretends that she has as much student loan debt as her roommates and to contribute $700 per month to our employer’s retirement plan.

She asked me “Should Millennials contribute to a 401K”?

I told her that millennials should absolutely contribute to a 401K.  I said that she especially should because she does not have any debt to pay back or major bills.  These are the reasons why she should start contributing:

  • She is 22 years old and by starting at that age, she can be well on her way toward financial independence (FI) in 15 years or less
  • Our plan offers low-cost index funds
  • Our employer matches 100% up to the first 5% an employee contributes
  • The contributions lower her taxable income
  • The money grows tax-free and is not taxed until she withdraws it at retirement
  • She can take advantage of dollar-cost-averaging
  • She can enjoy the benefit of compound interest
  • If she gets a different job, she can take the money with her and roll it over into an IRA
  • Even though I would advise against it, she can borrow against her account if need be

I explained to her that time goes by very quickly and she has a golden opportunity to build some serious wealth for herself.  Unless she lands a government job, she will not have a pension.  She will need this money to support herself in the future.

Jill has a unique situation.  She is a young millennial without any debt.  What makes her even more unique is that she is a new college graduate without any student loan debt.

If you have student loans, you should still contribute to your employers 401K account.  Even if it is just enough to get the match.  After you pay down your debt, take the dollar amount that you were paying towards your loans and direct it to your 401K.

You might not get to Financial Independence as quickly as Jill does.  You will, however, get there if you take a few steps.  If you have debt, pay off your debt and don’t create new debt.  Save as much as possible.  Sign up for your employers 401K plan as soon as you are eligible.

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Note: This post was originally published as a guest post.  The post was moved here because it was not available to be read on dollardiligence.com. That site is no longer active.

Know Your Competition

We start competing the moment we are born.  Competition is everywhere.  Completion is natural.  It is the cycle of life.  Eat or be eaten.  We must compete every day.  Only the strong survive.

When I was a boy, our dog had a litter of puppies.  They too were competing from their earliest days.  They would compete to get to the bottom of their basket to stay warm.  The puppies would compete with their brothers and sisters to get closer to mom to eat.  When I would watch and care for this litter, it did not take long to establish who the alpha of the litter was.  He always ate first and would not roll over when playing with the other pups.  How could such a young and tiny dog have established such will?

You might not see yourself as an alpha or even a competitive person.  If you are working on reaching financial independence, odds are you are more completive than you might think.  I would guess that you are very competitive.

Before I really gave it much thought, I never saw myself as a competitive person.  For the most part, I am a laid-back guy.  Growing up, I played baseball but was not very good.  The only football that I have ever enjoyed playing was when I played Madden.  The chess club or the debating team were also not for me.  I always saw myself as a Type B personality.

The first time that I realized how competitive I truly was when I read about capitalism.  I realized that I was competitive when I read that capitalism as an economic system where trade and industry are controlled by private owners who compete for profit.  I have been competing for a buck since I started earning a paycheck.

Even though I have only won a few trophies and awards in my life, I am hyper-competitive.  My whole adult life has been focused on competing.  I am not referring to being in competition with my neighbors.  What they have is not my concern.  The type of competition I am referring to is competition with myself and society to reach my goal.

I set a lofty goal.  My goal was to become financially independent.  For anyone to reach financial independence, there will be a great deal of competition.  On the road to that level of success, a person will have to face off against and defeat internal and external competing forces.

Postponing gratification is a form of competition.  The ability to save money is always at odds with the desire to spend money.  It is like there is an angel on one shoulder saying to save as much as possible.  On the other shoulder, there is the temptation to spend and waste money.  Temptation says if you want to be happy, buy that new car, house, or boat. You can afford it and you deserve it.

It is easy to give in to temptation.  Who wants to work hard and sacrifice to get ahead?  How can anyone sacrifice for decades to become financially independent?

Spending and having a good time is much easier than saving and investing for the future.  Internal competition is fierce.  At times, It is an internal fist fight.  It certainly felt that way for me.  As the saying goes, it is harder to conquer yourself than to conquer a city.  in order to conquer self, a person needs to develop emotional intelligence.

While it might be harder to conquer yourself, the external competition is also not exactly easy.  Most resources are limited.  Everyone is fighting to get ahead.

If you own a business, you are competing with other businesses and market forces to be successful.  Even if it is a side gig, there is still competition.  To survive, a business owner must provide the best products or services at the lowest price.

While it might appear that being an employee is easier than being an entrepreneur.  Being an employee is far from being easy.  An employee must compete to land a job.  There is competition to keep the position.  There is competition with peers to advance in the organization.  If your boss is a jerk, dealing with them brings on a level of competition.

The competition does not end after you earn the money.  There are competing forces who want to take your money.  Marketers are out to sell you stuff that you do not need.  They don’t care if you land in debt.  They are just competing to sell you something and to take your money.

You might have to compete at home to keep your money.  You might have your emotions under control, but your family has their own needs and desires that need to be considered.  It is not easy to keep a family on a budget.  It takes creativity to keep a family satisfied and not bored.

They might be the most difficult completion that you have to face.  You should not play a zero-sum game at home unless you want to have your family resent you.  It is wise to approach this level of competition with good faith and to negotiate.

Competition truly is all around us.  We face competition daily.  It does not mean that you are not competitive just because you were not the captain of the basketball team in high school.  For some people, it takes longer for their competitive drive to develop.

If you have decided that you want to be successful in this world, that thought alone requires a competitive nature.  If you are taking the required steps to get ahead in life, you are more competitive than you give yourself credit for.  If you are working on reaching financial independence by paying off debt, saving, sacrificing, and investing, you are extremely competitive.

Do you see yourself as being competitive?

Please share in the comment section below.

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New York Personal Finance Meet Up

I did not have the opportunity to attend Fincon 2017.  This blog was newly created in April and in all honesty, FinCon was not even on my radar of things to do this year.  After reading the many blog posts about FinCon 2017, I am defiantly going to attend next year’s event in Orlando, Florida.  I was, however, able to attend the New York Personal Finance Meet Up (#NYPFMeetUp).

The New York Personal Finance Meet Up was not a formal convention.  There were not any vendors or presentations.  It was an informal meet-up of people from the RockStar Finance Forum and the FinCon Community.

Most of the people who attended the meet-up were from New York City.  I was one of the few people who came from out of town to attend.  To attend this event, I traveled from my home in Pennsylvania.

When you think of New York City, you normally do not think of it as a place to live if your goal is to reach financial independence or early retirement.  Don’t get me wrong, Manhattan is about making big money.  It is also about spending big money because of the high cost of housing, taxes, transportation, and just about everything else.  The group of people who I met prove that you can reach financial independence while enjoying everything that New York City has to offer.

Prior to attending the event, there were some people who I wanted to meet because I was familiar with them from the financial independence community.  There were others in attendance who I did not know.  The financial independence community is very big and it is hard to read everyone’s work.  As the result of attending the event, I had the opportunity to meet a few new people and am looking forward to reading their blogs in the future.

Stefanie O’Connell

I was the first person to arrive at Tacombi in the Flatiron Section of New York where the meet-up took place.  I was only there for about two minutes and Stefanie O’Connell arrived.  Stefanie asked me if I was there for the blogger meet-up and our conversation took off from there.  Stefanie is a big deal in the financial independence space.  She is a full-time professional blogger and has been at it for 5 years.  She has over 10,000 followers on Twitter and has been featured many times in the financial media.  Stefanie’s target audience is millennial women who want to be as confident with their money as they are in their lives.  Stefanie O’Connell has an impressive blog and is doing a great job at helping her audience reach financial independence.

Chief Mom Officer

The second person to arrive was Liz from Chief Mom Officer.  She did not have to introduce herself because her gravatar is her likeness.  Like me, Liz traveled from out of town to attend this meet-up.  Liz was one of the bloggers who I was looking forward to meeting.  I stumbled upon her blog not long after my own blog was launched.

Even though I am not a mom, I can relate to Liz in other ways.  We both attended college and graduate school the hard way.  We worked full-time jobs in the day and went to school in the evening while managing our other responsibilities.  Liz’s blog is about reaching financial independence, raising her three children, and caring for her husband who has serious health issues.  At first, I was going to write that Liz is a good role model for moms, but she is a great role model for everyone to follow.

I had a great conversation with Liz about blogging and personal finance.  As a new blogger, she gave me some solid information on growing my blog.  We also spoke about her recent experience at FinCon.  She gave me some tips and suggestions for next year’s event.

Big Law Investor

Another personal finance blogger who I was looking forward to meeting was Joshua from Big Law Investor.  As the title of his blog suggests, Joshua is a lawyer and personal finance blogger who is living in New York City.  While Joshua’s blog is about personal finance for lawyers, the principles that he writes about are useful for anyone who wants to achieve financial independence.

Even though I am not a lawyer, I enjoy reading his articles that are written for lawyers.  His posts about the legal profession are objective and educational.  He writes about the challenges that lawyers face in their career, with student loans, and as investors.  I would highly suggest his blog to anyone who is interested in personal finance or is considering attending law school.  It was a pleasure to meet and chat with Joshua.  He is a rising star in the financial independence community.

The Luxe Strategist

It was also a pleasure meeting Luxe from The Luxe Strategist.  She and I launched our blogs around the same time.  We also follow the progress that each other is making.

Luxe was one of the coordinators for this meet-up.  Luxe is living an awesome life in New York City.  She writes about saving 50% of her salary while indulging in the finer things that New York City has to offer.  Who says you cannot have the best of both worlds?  If you want to learn how to have a high savings rate while living a posh lifestyle, check out The Luxe Strategist.

Pleasant Surprises

Again, since there are so many people in the financial independence space, it is hard to know everyone unless you are J. Money.  Another new blogger who I met at this event was Church from My Mattress Money.  I enjoyed chatting with Church.  I am not just saying that because he is a Philadelphia Eagles fan.  He and I had a good conversation about how important it is to first focus on reaching financial independence before considering early retirement.   His blog is about one year old and has some great content about tracking your net worth, insurance, and how his family shaped his views about money.

As the meeting went on, I had some other great conversations.  I had an interesting conversation with a gentleman named David.  We spoke about using Pinterest to grow blog traffic, the optimal frequency for blog posts, and about different personal finance forums.

About 15 minutes before the meeting was scheduled to end, a gentleman named Jack walked over to me and struck up a conversation.  I was not familiar with Jack’s blog because he is not on RockStar Finance.  Jack explained how his blog is about travel hacking.  He also explained to me how he gets to take great trips for almost free by applying travel hacking strategies.  Jack and I exchanged contact information and he has provided me with some solid tips on how to implement these practices.  Thanks, Jack, you rock!

Conclusion

As you can tell from my post, I had an awesome time.  It was great to be able to meet this group of people who are working towards financial independence, helping others, and living exciting lives in New York City.

There was only one part of the evening that I regret.  As my wife and I were walking back uptown to catch our bus home, I realized that I did not get to talk with everyone who attended the meeting.  It was my fault for not taking the time to introduce myself.  It was difficult because there were 15 people at the meeting, the meeting was only 2 hours long, and as you can imagine the conversations with this group of dynamic people went way beyond small talk.  Next time, It will be my priority to talk with everyone who attends.

 

My Uncle Xavier: Veteran, Millionaire, Mentor

I have been thinking about writing this post since I started my blog.  As you will read, Veterans Day might be the most fitting day to publish it.  This post is about my Uncle Xavier.  As the title suggests, Xavier was a veteran, millionaire, and mentor to me.  Below is his story and a little bit about our relationship.

Like many members of the Greatest Generation, my Uncle Xavier had humble roots.  He grew up in West Scranton, Pa during the Great Depression.  His Father owned a small corner grocery store.  His mother was home-bound because she went blind at an early age from diabetes.

After high school, there was not much opportunity for Xavier.  He lived with his parents when he was in his early 20’s.  Jobs were hard to come by in those days.  He used to tell me about taking the Laurel Line Train from Scranton to Pittston to work at McCrory’s Department Store.  He described the scenery as “the outskirts of hell” as the train would pass by the stripping pits where coal was once mined.

When Xavier was age 26, he was drafted into the U.S. Army.  It was the early 1940’s and the world was at war.  While in the Army, he served on 2 major theaters in Northern Africa and in Europe during World War II.  Even though he saw horrific fighting, he spoke highly of his time in the service.

After the war ended, he returned home to Scranton, Pa.  While the economy was booming for most of the country, the good times skipped Scranton as they always seem to do.  He could not find a decent paying job.  He decided to take advantage of the newly created G.I. Bill and went to The University of Scranton where he earned a BS Degree in Economics. He then moved to New York City and went to graduate school at NYU.

My Uncle was a straight-laced guy.  He did not enjoy living in Greenwich Village all that much.  He said the bohemian crowd was not for him.

Following graduate school in New York, he decided to move to the Washington D.C. area.  He said that there was a tremendous amount of job opportunity there.  He had an easy time landing a government job because he was a veteran.

While in Washington D.C., he met and married my Aunt Ann.  They both worked for the State Department.  They settled into a townhouse in Arlington, Virginia.  He said it was a great investment because it was near a new Metro Station.  They also bought a weekend house at Bethany Beach in Delaware.

My Aunt loved to travel.  She made my Uncle Xavier join a travel club.  They took many trips to Africa, Europe, Asia, and South America.  They were truly jet-setters.

Even though they lived the high life, my uncle was a great saver and investor.  This was many years before index funds were available to individual investors.  My Uncle invested his money in blue-chip stocks.  He was a big believer in the consumer staples sector.

My dad would talk about Uncle Xavier from time to time, but I do not remember meeting him until 1998 when I was age 21. He moved back to the Scranton area because he had to move his wife into a nursing home and wanted to be closer to the family.  One Saturday evening, he called my dad and said that he wanted him to come to his apartment to talk about money.  He brought me with him for the visit.

It was a surreal meeting.  My Dad was an Accountant and he wanted him to be the executor of his will.  He also needed help picking out a PC because he wanted to track his investments online.

When we were at his apartment, he showed my dad his investment portfolio.  He had $1.8 million dollars invested in stocks with Merrill Lynch, tax-free bonds with Fidelity, and mutual funds with Vanguard.  I think my dad almost had a heart attack when he found out he was worth so much money.

I never met a millionaire before.  I was taken aback.  It felt surreal.  I thought that this would be a great opportunity to learn more about the markets.

Moving forward, my dad felt obligated to spend time with Xavier.  It was truly a pleasure to hang out with him.  We went out to the local diner for breakfast almost every Saturday for many years.  We took him to see a Notre Dame football game at FedEx Field in Washington D.C. and my parents took him to Las Vegas twice.

I was already saving and investing for over one year when Xavier came into my life.  Meeting him enhanced my desire to become financially independent.  He taught me so much about living below your means and investing.  He was worth almost two million dollars and lived in a one-bedroom apartment.  He spent his days reading the Wall Street Journal, watching CNBC, and taking two trips per day to the nursing home to have lunch and dinner with his wife.

Uncle Xavier was in my life for seven years.  I spent a great amount of time with him.  Other than going out to eat, I would take him to his appointments as he was getting older.  I was in college, so I had some free time to do so.  My Aunt passed away in 2001 and he passed away in 2004.

I have experienced death before, but never mourned anyone the way I mourned when he died.  It hurt.  I felt like I was punched in my chest.  I remember crying for a good 10 minutes when he passed away from a heart attack.

I miss him.  It has been a while since I gave him this much thought.  He was my Uncle, but also my friend.

While other 21-year old kids were out messing around, I was learning how to live and be a man from a guy who truly was the millionaire next door.  Spending time with Xavier has shaped my life.  I am truly grateful for the time that we spent together.

I hope you enjoyed this special veteran’s day post.  It is a tribute to my uncle, my father, as well to all the men and women who served in the armed forces.  Thank you all for your service.

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Six Month Blog Review

Thank you for taking the time to read about my first 6-months as a personal finance blogger.  I have read that reaching the 6-month point is a major milestone because it is when many bloggers call it quits.  The past 6-months have gone by in a flash.  Creating The Financial Journeyman has been an educational experience.  Other than being a learning experience, it was fun to try to be creative and to watch the blog develop.

What I have most enjoyed about creating this blog is the interaction with other bloggers in the personal finance space.  Everyone has been friendly.  Whenever I reached out to someone with a question, they have always been willing to assist if they were able to do so.  It is such a great experience to be part of a community that is working towards helping others to improve their financial situation.

Along the way, I have interacted with people from many different walks of life and who are in different financial situations.  There are moms who blog about their family finances, Asian finance bloggers, Millennials, Gen-Xers, Baby-Boomers, and Professionals.  There are blogs that focus on getting out of debt, budgets, dividends, index fund investing, financial independence, and early retirement.

Launching the Blog

I did not know what to expect with this blog.  I do not classify myself as being technically savvy, but more along the lines of technically functional.  My blog was created and launched on April 8th, 2017.  My good friend, Tim @timtekk volunteered a whole Saturday of his time to build the blog.  Without him, this blog would not exist.  He is also my go-to guy when my Word Press plugins are not working correctly.

My First Post

The first post that I published was about how my grandmother taught me about money when I was just a boy.  I did not know if anyone would ever read it.  The post was only about a day old and it received a comment.  The first comment that I received was from @My_Sons_Father.  He gave me encouragement and I appreciated that.  A few weeks later, J. Money commented on the post.  I was taken aback knowing that J. Money stumbled across my new blog that had only 3 posts at the time.  That motivated me to keep at it.

Performance Metrics

The first few months of traffic was slow.  Traffic did pick-up, however, after I became more involved in The Rockstar Finance Forum.  My big spike in traffic came when I joined the “chain gang” for the Drawdown Strategy.  By being active in Rockstar Finance, I have been able to interact with many great people.  September was my best month because I had a post featured on RockStarFinance.com.    Below are the traffic metrics for the past 6 months:

April

  • Pageviews – 415
  • Sessions – 228
  • Pageviews/Sessions – 1.82

May

  • Page views – 645
  • Sessions – 323
  • Pageviews/Sessions – 2

June

  • Page views – 1,325
  • Sessions – 711
  • Pageviews/Sessions – 1.86

July

  • Page views – 1,980
  • Sessions – 1,062
  • Pageviews/Sessions – 1.86

August

  • Page views – 1,450
  • Sessions – 821
  • Pageviews/Sessions – 1,76

September

  • Page views – 3,822
  • Sessions – 2,720
  • Pageviews/Sessions – 1.40

Earnings

In the first six months, I have joined Amazon Associates, Google AdSense, The Pepperjam Network, and CJ.  Below are the metrics for the past six months:

Amazon Associates – $13.35

Google AdSense – $19.30

Pepperjam – $0.00

CJ – $0.00

The earnings have not been great.  However, Jim @RouteToRetire explained that this is a process that takes time.  The monetization goals for this blog are primarily based on paying for expenses and sustainability.

Top Traffic Sources

Rockstarfinance.com – 1,770

Direct – 950

Twitter – 363

Google – 304

Forums.rockstarfinance.com – 114

Directory.rockstarfinance.com – 79

Top Posts and Pages

How the Mob Influenced My Asset Allocation – 2,055

Home Page – 272

Blog Page – 259

Early Retirement Portfolio & Plan – 135

The Aldi Experience – 91

About Me – 82

Twitter

Prior to launching The Financial Journeyman, I had a twitter account but only used it for following financial writers, a few financial bloggers, and mainly my favorite sports teams.  Twitter has been a source of my relative success.  I have used to communicate with many of the top financial bloggers.  My Twitter metrics are:

Following – 4,406

Followers – 2,005

Tweets – 1,713

Likes – 2,110

Conclusion

I waited six months to publish any type of metrics on my blog.  Moving forward, I am going to publish a quarterly blog performance report.  These types of posts are not my favorite to write because I feel like I am creating a report for my boss.  However, I do feel that publishing these reports are a great way to track progress, celebrate success, and motivate others.  There have been a few other big moments for The Financial Journeyman, but they were not metrics driven.  I will write more about them on my end of year review post in late December.

How do my metrics compare to your first six months of blogging?

Do you think my blog is heading in the right direction?