Tempis Fugit & Letting Sleeping Investments Lie

Well, it's been a few months since I posted here! I promised a video, and here I haven't even put the darn thing up!

To be honest, I've been really swamped with schooling (welding, which is going along quite nicely), and keeping up with the social groups I've joined in the last few months. So, lets just get on with one of my favorite topics: Money.

Over the last few months, going to school, I haven't had any money to invest, and I have been hesitant to sell any of my investments as they have been both paying dividends, and rising in value. Don't fix what's not broken, right?

So I come to my point of the day:

If you are comfortable with your investments, or you can't think of a really good reason to sell them, then Do Not Sell Them!

I have made that mistake in the past, feeling so embarrassed that I didn't even mention it in this blog. I lost about $300 (a mere rounding error for some, but a good chuck of money for me!) when I sold low because I was SCARED.

Unfortunately, as in life, the brave and the bold walk away with the prize.

So the moral for today is:
1. Research your investments thoroughly
2. Follow a contentious plan
3. Keep to the course!

Do you have any topics you want me to tackle?
Let me know by dropping a comment below!

So you want to be rich.

So you want to be rich, eh?

Well, this may come as a bit of a shock to the trust-fund babies in the back row, but most of the 'rich' in North America (which I personally define as having over $500,000 in net worth), do not come by their money by ways of inheritance or gifts.

Actually, the largest majority of the rich are working class folks such as your tradesman neighbour.

Ye of little faith, check out 'The millionaire next door'.

Although this book is a little old, having been published in 1998, I personally believe that many of the tenets within have held true.

By working a steady job, earning a decent wage (much like most trades will provide), early in ones life, living below ones means, and investing patiently, I believe that anyone can retire at an earlier date, and with more assets then most.

For example, we can take a person such as myself:

Age: 26
Occupation: I.T. - soon to be Welder
Expected Wages:
   I.T. - ~$40,000 /year
   Welder - ~$45,000 / year + Overtime

I will work hard and make $50,000 take-home, with raises of ~$2000 /year as I gain experience and education.
I will invest as much as comfortable (~$25,000 + $1000 /year)
I will seek investments that are >2% dividend yield.
If I realize a return of ~4% after inflation (~3%), I will see a growth of ~7%.

Over the next 14 years, this investment will grow to over ~$733,000!

This means that when I am 40, I will have 3 quarters of a million dollars to my name.
Does this take into account taxes? No.
Does this take into account large raises or significantly higher wages? No.
Does this take into account market volatility (up or down)? No.
But, it does show that if you have the balls, and some luck, you can be rich before you're 40.

Will it be easy? No.

But it is possible, and as a wise man once said:

"The first hundred-thousand was hard. After that, it got easier."


----

Want to see the math in action? I've posted the results of my spreadsheet calculations below, and also ran them out to the usual '40 year' working period:


Bonus Calculation Chart:

Year	Invested	Rate Of Return	Result
1	25000.00	0.07	26750.00
2	52750.00	0.07	56442.50
3	83442.50	0.07	89283.48
4	117283.48	0.07	125493.32
5	154493.32	0.07	165307.85
6	195307.85	0.07	208979.40
7	239979.40	0.07	256777.96
8	288777.96	0.07	308992.42
9	341992.42	0.07	365931.88
10	399931.88	0.07	427927.12
11	462927.12	0.07	495332.01
12	531332.01	0.07	568525.26
13	605525.26	0.07	647912.02
14	685912.02	0.07	733925.86
15	772925.86	0.07	827030.68
16	867030.68	0.07	927722.82
17	968722.82	0.07	1036533.42
18	1078533.42	0.07	1154030.76
19	1197030.76	0.07	1280822.91
20	1324822.91	0.07	1417560.52
21	1462560.52	0.07	1564939.75
22	1610939.75	0.07	1723705.54
23	1770705.54	0.07	1894654.92
24	1942654.92	0.07	2078640.77
25	2127640.77	0.07	2276575.62
26	2326575.62	0.07	2489435.91
27	2540435.91	0.07	2718266.43
28	2770266.43	0.07	2964185.08
29	3017185.08	0.07	3228388.03
30	3282388.03	0.07	3512155.20
31	3567155.20	0.07	3816856.06
32	3872856.06	0.07	4143955.98
33	4200955.98	0.07	4495022.90
34	4553022.90	0.07	4871734.51
35	4930734.51	0.07	5275885.92
36	5335885.92	0.07	5709397.94
37	5770397.94	0.07	6174325.79
38	6236325.79	0.07	6672868.60
39	6735868.60	0.07	7207379.40
40	7271379.40	0.07	7780375.96

Want to use this spreadsheet for your own calculations? Comment below and I'll e-mail it to you!

I'm going to try Welding as a career.

I'd like to pardon the break I've been having - I've been particularly busy, and my health has begun to suffer with the colder weather.

I had mentioned previously that I am taking a part-time welding course at a local school.

Well, over the last six weeks, it has peaked my interest, and now I have signed up to take the foundation levels course, which is 7 months long, full-time.

The province of BC, where I live, has recently received a very large, $8 billion dollar contract to build non-combat support ships (boats) for the federal government's navy. This means that there will be alot of work for trades people (especially iron workers, welders, millwrights, et al).

Between getting all of my ducks in a row to apply for the university level course to learn how to be a level C welder (the most basic, and often used level of techniques), I have been incredibly stressed and anxious. My health has been slowly getting poorer due to this and the chill that recently cut through our area.

I planned on having a long-term income for my investing, such as what I have at my current workplace. But the lure of making over $25/hour, and being eligible for overtime has made me see that I could make over double what I make at my current job if I go into a trade and upgrade my education in that trade as I go along.

My current job makes $35800 a year, gross (before taxes).
A C-level welder can make $42,000 gross at $25/hour (40 hours/week, no overtime, before taxes)

My current job has told me that will provide a $5000 raise every year (based on performance, and not guaranteed).

After 1 year total experience as a C-Level welder, (7 months of school + 5 months of work), you gain a C-Level sticker in your 'trades book'. This means that you have the possibility of asking for a higher wage, as you are an 'accredited' C-Level at that point.

Then, you can take the B-Level testing, which is 5 months. After 1 year total experience as a b-Level (5 months of school and 7 months of work) you can get the accreditation as a 'B'-Level, which means, again more job eligibility. There as also more accreditation down the road that can add more to your 'trade book', and offer additional opportunities.

So basically, by going to school for 7 months, I would have to move back in with the parents, which I had hoped to avoid, as I want to allow them to have more money to save for retirement.

But, I don't see much other choice, as it would be very tough for me to somehow make enough money (be it on the markets or elsewhere) to pay for the rent for me, and my girlfriend, in our current residence.

So, I am looking for decent exit points for most of my investments, so that I have a surplus of cash available for all of the expenses that will come up when I am going to school.

I have yet to tell my work that I am leaving though. They are a small business, and frankly, I think the business owner would become very, very agitated that I am leaving (he is Italian, and very, very irritable).

I just finished the last of the tests and entry requirements for the course last week. I am pegged to go at the start of March or April 2012 at the earliest, depending on if people drop out of the March course, and let me go earlier.

The primary work for the big ship-building contract start late 2012, so if I get in early enough, I can try to apply directly for that work. Otherwise, there will be many shops and companies that lose their welders to that large contract at the docks, and I can apply for those openings as well.

I just hope to hell that this works out. Maybe there won't even be any work for me to do - Maybe this schooling will be worthless, and an entirely futile exercise.

We'll see.

Giving a Friend Permission to Spend

I have a friend at work who fulfills any and all of his wants, on a whim.
Whenever he has more then a $100 in his chequeing account, he immediately liquidates it on a want.
If there isn't quite enough to cover the want, then it goes on a credit card.

This would be a decent, if future-less life strategy, if he paid off his credit card every month, and had no debt.
The problem is, he has nearly $30,000 of debt in a line of credit.

He will come to me asking for advice on his most recent want.
I tell him the same thing every time.

1. Make an emergency fund of $1000.
2. Set a small monthly amount (~$100) for discretionary spending.
3. Pay off the debt with everything left over after necessities.

He does not follow this advice.
Instead, he will come back to me for more advice.
Then I realized something.


He is asking for permission to spend!


I  I think this is why we have such a strained friendship at timesonly give him permission to spend a the small discretionary budget, and. Personally, I don't feel a need to spend money all the time; I am usually happy with inexpensive or free diversions.

It has gotten to the point where I can't even bear to speak to him about money anymore.
Everytime I tell him to save money and pay off his debt, he will leave depressed.
Worse yet, he will come back to see me again with a new toy in hand, happy as a clam.

He knows that this is not a healthy pattern of behavior, but he continues never-the-less.




What can we do to help this wild spendthrift?

There isn't much we can do directly.

But, we can make our frugal lifestyle seem better and better every time we see them.

We can also show them a calendar that states exactly when you're planning to retire, and how it is many years (maybe decades!) before they even thought possible.

Then, explain that the date keeps inching earlier and earlier due to our good habits, and putting windfalls towards it.

Leading by example, we can help those without the natural willpower to save and invest.



EJ

Planning Ahead - How to make goals for your future - Pt 2.

Yesterday, I talked about the levels of goals I use.
Today, I'll talk about how to use those levels to speed your progress to making your dreams come true!



Jack, Dreams are silly. 
Dreamers are lazy and always fail.

This is incorrect.
Dreamers are the visionaries of the future.

Many of the most successful (and famous) people in the world are dreamers.
CEO's, actors, inventors, pilots, astronauts, scientists, etc.

These people use their passion to do something that isn't commonly thought possible, and make that dream come true by following through.

I believe passion for dreams is at the heart of every goal (and success).

If you can't feel a warmth in your heart for a goal (or the payoff of that goal), then I believe it's nearly impossible to achieve it.



Take your big goal and make it smaller.

No, I don't mean moving to Idaho instead of Australia.

I mean you should break down your big goal into smaller, and more easily accomplished 'pieces'.

If you try to 'move to Australia on only $380.50' then you will be sorely disappointed when you fail to succeed on that goal.

But if you put that $380.50 a week into your 'move to Australia' fund, then you have accomplished a 'piece' of that larger goal. You can feel proud of that. You will be moving towards meeting your goal. And every time you do it, and see the balance increase, you will feel empowered and accomplished.

This sense of accomplishment helps drives us to our goals!



Build 'sub-goals' from the pieces of larger goals.

Take all of those large goal 'pieces', and make them into small 'sub-goals'. Smaller goals are easier to follow through on, and still give you a sense of accomplishment.

Plus, many small efforts will nearly always provide a better result then one large effort.

This is true in goals, and also in investment.



Putting it all together.

Let's run with the example about the person that wants to move to Australia.
Imagine that the person created sub-goals when she:

• Broke down the saving into a weekly amount.
• Concentrated on searching for good, discounted housing in Australia, instead of moving into a more popular, expensive area.
• Worked hard to lineup a job for her when she gets there.

All of these smaller 'sub-goal's have a positive effect on her chances of success.

Immediately
Cost to move to Australia immediately (housing, travel costs, no job): $ 200,000
Cash in pocket this week: $380.50
Immediate goal success rate: 0%

3 year deferral
Cost effect of deferring move 3 years: $120,000
(hunting for discounted housing, travel, and lining up a job in Australia)
Cash in hand from saving $380.50 a week (@ 1.5%) for 3 years: ~$60,780
Goal success rate: ~50% - She is short by approximately half. She may be able to make it, but maybe not.

5 year deferral
Cost of deferring move 5 years: $110,000
(hunting for discounted housing, travel, and lining up a job in Australia +1)
Cash in hand from saving $380.50 a week (@ 1.5%) for 3 years: $102,945
Goal success rate: ~92% - She has almost the entire amount in full, and has and excellent chance of making a good life in Australia.

By saving up, and achieving sub-goals, she has changed her chances of success from 0% to over 90%.

It's very similar if you have any sort of 'overwhelming' large goal, like paying off a house, or investing for passive income.



Moral
If your goal is overwhelming, break it up into smaller pieces that are easier to accomplish. 

Then get out there, and Start Accomplishing!



EJ

Planning Ahead - How to make goals for your future - Pt 1.

Jack, I'm trying to get my life in order, but I'm not making any progress!
How do you get to your dreams?

I'm not very good at planning, but I am quite good at making (and reaching) goals.


Goals.

Take a long look at that word - It's going to give you bulls-eyes on the wall to aim for. Without these targets, much of your efforts will simply not move you any closer to where you want to be (your 'dreams').

I personally imagine 5 main levels of goals:



Daily Goals.

These goals are very simply, easily attainable goals that you can accomplish in about a day.
Examples would be:

• Cutting the lawn.
• Browsing over your investments.
• Rolling some coins to deposit in the bank.
• Reading a self-help book.
• Learn a basic part of a new skill.
• Clean the house.
• Write a few pages for a book

Short-Term Goals

These goals are a little more involved, as you have to start to apply some concerted effort to complete them. They should span about one week.

• Get through the work-week.
• Search for & research a new car.
• Clean up a storage unit & dispose/donate old items.
• Prepare for a large social gathering.
• Research and Invest some money in an equity.
  

Medium-Term Goals

These goals are those that you will have to revisit quite a bit over a longer period of time to complete. These will generally take you approximately one to three months.

• Search for / inspect a new home.
• Earn a paycheque.
• Write a few chapters for a book.
• Pay off a small portion of debt.
• Teach someone else one of your skills.

Long-Term Goals

These are goals that will need to have a large amount of additional effort put towards them for a long time in order to be fulfilled. This group is where you place any goals that you have a decent idea of the completion time, but will take over three months.

• Paying off a house.
• Paying off a large debt.
• Living off passive income

Lifetime Goals

This is where goals that are not 'explicitly plan-able' go. That is, you are not able to make an decent, short-term estimate about how this is going to happen yet. When you do have the means to make a fairly accurate estimate of when this goal will be fulfilled, then move it into the 'long-term' goals.

• Live off passive income.
• Find a life-long partner & raise a family.
• Travel or move someplace far away.
• Purchase a large piece of property in the country.

But Jack, all of my goals will take over a year to complete!
I don't have any shorter term goals at all!

Make some.

By not having any easily attainable goals, you miss out on feeling the rush of accomplishment that comes with meeting and exceeding those goals!

Next day, I'll talk about some strategies for breaking down your larger goal into smaller goals that are more easily accomplished.



EJ

Being Addicted to Investing

Now that I have started investing in companies through the Toronto Stock Exchange (The TSX), I have begun to constantly wish that I had more to invest.

If I only had more, I would be able to take advantage of the growth and passive income opportunities of the market!

But then again, I have to live my life, pay my rent, buy groceries, pay bills, and all the other 'fun' things that people do these days.



How do you know you're investing too much, let alone too much in a single company?

I believe that if you put more then 50% of your income into stocks, you are either crazy, or absolutely driven. Both of these states are very risky, and you can lose control very easily.
I'd like to make it clear that I am currently one of these 'crazy or driven' people.

Some of the things that 'driven' investors may do:

• Take a loan to invest.
• Sell low value objects to secure funds for investment.
• Bypass low-cost opportunities that may enrich their lives in non-financial ways.
• Lower their cost of living to sub-poverty levels to free up funds.
• Take a second job for that 'little bit extra'.

All of these habits are similar to what someone with a substance abuse problem would do to secure funds for their next 'fix'.

Investing is a positive thing. Taking a Tylenol for pain occasionally is also a positive thing. They both improve quality of life.

But if you need to invest, and it drives you like a burning craving in your soul, perhaps it is time to step back and take a look at your plan. Does it really make a difference if you sell the $10 coffee gift card you received for your birthday just to buy one more share of EXE.UN ?

I guarantee you there are a few investors who would say yes.

And I would like to say right now, that there are more important things then having that one more share.

• Go outside.
• Walk to the library, and read a novel.
• Meet for coffee with an old friend.
• Paint a picture.
• Have a family member over for dinner.

Make the most of your life, and enjoy the low-cost activities that are available to you.

After all, that share may eventually help pay for your work-free lifestyle, but it will never bring back the people, places, and experiences that you are able to have today.



EJ

Happy Thanksgiving!

Happy Thanksgiving, everyone!

I hope that all of you are enjoying the warm company of familiar faces, friends and family. Perhaps there is a bird in the oven, and the small is already making your mouth water.

Take this time to remember all that you are blessed to have, and that as long as you plan to succeed, you will only come closer and closer to your dreams :).

Know that you have my warmest wishes, and that I hope you have a very Happy Thanksgiving!

I'm going to go help prepare our dinner feast!

Taking loans from family members

I'd like to talk today about a topic that I've often had come up from my friends (and even some of my relatives).



Should I take a loan from a family member, Jack? They really want to help me, and I really need the money!

There are a few questions we have to ask ourselves:

1) How badly do you need the money?

Are you so broke you can't buy food, or are you just paying off your credit card enough to let you get another double-fudge mocha-chino?

2) How long until you will be able to pay back the loan?

If you have no idea when you will be able to pay the person back, then you should seriously review your reasoning behind considering this a loan, and not a forced 'gift' from a relative.

3) What is the money for?

Do you need the money to purchase something you don't need, like a new TV, or a high-end coffee-maker? Then you don't need that money, you need to grow some will-power.

4) Does the person you are taking the loan from need the money more then you?

I have seen people take a 'loan' from a parent that didn't have two pennies to rub together, and was hair-deep in debt. The person taking the loan didn't even flinch when they spent the considerable wad of loaned cash at the bar, treating all her friends to cocktails and martinis.



But Jack! I really want the new (Consumer garbage) now! It's only (Inflated price), and I can't live without it! Daddy will pay for it from his RRSP!

Grow the hell up.

You are an adult now, or soon will be. You've got to belly-up to the reality that you're rarely going to be able to afford everything you want.

You've also got to accept that by being so spineless, you're influencing people to be just like you.

Your relatives don't need to lose more money. They likely had to endure some sort of hardship for it, whether it was working for 20 years straight, or inheriting it from a loved one.

And just think, if your children grow up to be just like you, eventually, you'll be on the receiving end of these same pathetic cries for money.

Key Points:
- Be responsible.
- Don't pull others down into your pit of debt.
- Consider other people's situations.
- Don't spend money when it's not nessicary.
- Grow some willpower.

Watching my investments (and the market) fall

Well, with the recent downturn, I've been watching nearly every one of me investments tank.



Well, Jack, I bet you're feeling like a big fat fool now; all that money down the drain!

Not so fast.

My investments were all into decently strong dividend stocks. The fact is, the investment I've put the most into pays a healthy monthly dividend. At these current prices, my Synthetic DRIP (Dividend Re-Invesment Plan) will buy two whole shares instead of one.

Which means that these low prices have actually ACCELERATED my plans, not caused them any lasting harm.

In fact you could say that with this downturn, my investments are worth MORE to me then before!

They will purchase a nice boost of shares, and I win. My dividend income goes up, because more shares are purchased.

So, Am I throughly stressed by the market's fall? No.
Am I somewhat nervous? Yes, of course.

Remember, I've only been invested in the market for just over a month.

I don't have the personal experience of long-term investment woes.

But at the current state of the markets, am I running for the hills? No.
I'm going to sit here at my desk at work, and write posts, and read non-market news, and try to relax, and think about having a nice fat passive income stream to look forward to in the future.

Rent or Buy in Vancouver, BC

I received a comment on my previous post, and I wanted to write a bit on it today.

Anna said...

I am currently renting and want to buy a home of my own. The housing market where I live is very expensive - Vancouver, B.C. Would I be better off investing my money and waiting longer or should I save as much as I can and jumping into the real estate game as soon as possible?? Thanks. Anna.

Should I Rent and Invest, or Buy in Vancouver B.C, Jack?

This is a bit of a loaded question because I don't have the whole picture. There are quite a few questions that would be needed to be answered for me to make any sort of recommendation.

How much does she make in a year?
Is she in a sustainable industry?
Does she have any dependents?
Does she have to remain in Vancouver for her job?
How much does she have saved up for a down-payment?

I'm going to dig deep and make up some numbers here.



Anna Version 1
Age: 25
Annual Income: $42000 (Gross)
Job Industry: Stable
Job requires remaining in city: Yes
Dependents: None
Down-payment Saved: $32000

For this Anna, she could survive by renting a postage stamp apartment, without much room, and have still have a bit left over at the end of the month. If she expects to be able to live in style, she is sorely mistaken.

In my search for rental apartments in Vancouver I was unable to find hardly anything to rent for less then $1500 a month. And that is a small, 1 bedroom apartment in the rougher part of town.

To purchase, the costs are in the range of ~$200000 for a 'dumpy', old apartment on the wrong side of town. She would be able to swing this, and maybe even ~$225000, and still be under the ~38% maximum percentage of income mortgage payment.

What would she have in the ~20-25 years it takes her to pay off the mortgage?

A dumpy, old, smelly apartment on the wrong side of town.

I would rent for the moment, invest any largely spare money into stable, long term, passive income investments, and try to go for a promotion. If she purchases in Vancouver's core, in a few years, I don't believe she'll be happy with the results.

After she has some more saved up, and perhaps a small passive income stream to help her along, I would move out of the city, and secure a house at a fraction of the cost. She could get a part time job, and start enjoying her life instead of living a hand-to-mouth existence in the city.



Anna Version 2
Age:31
Annual Income: $75000 (Gross)
Job Industry:Unstable
Job requires remaining in city: No
Dependents: 1 Child, Single Parent

Down-payment Saved: $12000

This Anna was blessed with a child earlier in her life, at 23. She had finished school, and now works as a sales rep for a pharmaceutical company that sells a newer, untested drug for good profit. She will be the first to get fired if the profits stop flowing, but she makes good money at the moment.

She doesn't have enough money saved up to even think about buying in the city.

She needs a little more space, and would prefer to be nearer schools for her child.

The 'husband' disappeared a long time ago.

I believe that she should consider moving out of the city. I feel this way because I don't believe that the city is the best place to raise a child, especially when you work full-time and don't have any help from a spouse.

She may even be able to work out a tele-commuting agreement with her current employer, and the locational-leeway would allow her to pick a place that has some space for her child,  as well be nearer to schools and other family oriented activities (parks, playgrounds, cinemas, etc).



Anna Version 3
Age: 27
Annual Income: $38000 (Gross)
Job Industry: Stable
Job requires remaining in city: Yes
Dependents: None

Down-payment Saved: $52000

This Anna has a sizable down-payment saved. Perhaps it was inherited, because her job certainly doesn't allow for that amount of savings.

She could get a mortgage for a place up to around ~$250000, but that still isn't much better then a slummy apartment.

She has to stay in the city for her job, but her job is pretty poor income for a city-living person. It's likely that she could move out of the city, and put that down payment to far better use on a house outside of the city.

There are even tracks of land in the 'boonies' that are less then ~$100000. She could own a few acres on the outskirts of civilization in a few years, take a few more to set up a long-term passive income stream, and raise her child in the peace and quiet of the country.

Maybe she would even have the time to teach her child the value of hard work and having a good savings and investing plan.



Jack, you obviously don't like the city! What if I want to live in the city, and buy a scummy apartment for a small fortune?

All the more power to you.

Just don't say I didn't warn you when you're gaining on 45 and you don't have anything to your name but a mortgage for a scummy apartment on the wrong side of the tracks, with a gorgeous view of a brick wall and the cringe-worthy stench of the docks.

Hate working? Invest in passive income!

I'd like to talk about why I put nearly 85% of my income into passive income investments.

The fact of that matter is: I hate working.

I dislike the idea of being under someones thumb so much, that I will suffer in a dead-end, decent wage job for a long time, if it means I wont have to work for someone else ever again.

Every time I plunk down some of my paycheque on a passive investment, I feel like a little piece of me has ascended away from the daily 'rat race' toil, and if I just sock a little more away, I just might be able to get away from the god-forsaken hell that is full-time work.

So, I watch my investments, I view the market as a key to a problem that I have never been able to solve - Living without having to work for that living.

Will my $19.74 this October allow me to live without a care? No.

But it will make a small difference, and if enough of those small differences stack up, it just might allow me to live the way I've always wanted:

Professionally Unemployed.

Dividend Income Update - October 2011

This month, I jumped in on some more SLF (Sunlife Financial) because I believe them to be a bargain price for such a well-run financial firm.

I purchased 45 units at $24, which makes the $.36 quarterly dividend approximately a 6% yield. I believe this to be excellent for a company that has never dropped it's dividends.

This month is probably going to be one of my slowest months ever for dividends. Add that to the fact that the weather is pretty rainy and depressing makes for more of a slog then a slide into dividend-funded happiness.

I'm going to add an additional Dividend Income Update for the end of October, and show what I truly received as opposed to what I'm estimating to receive this month like I am here.

Here's hoping that I'm able to add another great position this month! :-D

Equity (Stock, Bond, ETF, etc)	Amount (In Shares)	Dividends Paid This Month
Artis REIT (AX.UN)	200	$18
Canadian REIT(REF.UN)	1	$.12
Bank of Montreal (BMO)	1	$.70
Bank of Nova Scotia (BNS)	1	$.52
Emera Inc. (EMA)	1	$.33
Pengrowth Energy (PGF)	1	$.7

Total Dividends for month of October: $19.74

Net Worth Update: September 15th, 2011

So, this month, I dove in and bought some quality dividend stocks.
If anyone tells you that your first trades are without worry and peril, they are lying :-P.

I also rolled my taxable stock certificates into my TFSA - I was reading online about some of the records you have to keep for tax purposes when you have stocks in non-registered accounts, and I am honestly doubtful that I could keep up to date with such calculations.

My goal progress increased by about .19%  (from .42% to .61% of my goal of $1,000,000 dollars net worth), and my down-payment fund has been consumed by my TFSA brokerage account.

I'll be making another net worth update in a few days on September 30th.

(This post summarized my current net worth in an easy to read table - It's a snapshot, so as unforeseen expenses or windfalls accrue in the month, this will become less relevant.)

Net Assets	Aug-31-11	Sept-15-11	Change	%
Emergency Fund	$ 1,000.00	$ 1,000.00	$ -	0.00%
Taxable Accounts	$ 3,000	$ 0.00	$ (3,000.00)	(100.00%)
Taxable Brokerage	$ 665.94	$ 0.00	$ (665.94)	(100.00%)
TFSA Brokerage Account	$ -	$ 5577.44	$ 5577.44	+++%
RRSP Accounts	$ 565.00	$ 565.00	$ -	0.00%
Stock Options	$ -	$ -	$ -	0.00%
ESPP	$ -	$ -	$ -	0.00%
House	$ -	$ -	$ -	0.00%
Receivable (Payable)	$ -	$ -	$ -	0.00%
Other Assets	$ -	$ -	$ -	0.00%
Total Assets	$ 5,230.94	$ 7142.44	$ 1911.50	36%
Liabilities
Credit Cards	$ -	$ -	$ -	0.00%
Mortgage	$ -	$ -	$ -	0.00%
Tax Liabilities	$ -	$ -	$ -	0.00%
Other Liabilities	$ -	$ -	$ -	0.00%
Total Liabilities	$ -	$ -	$ -	0.00%
Goal Progress ($1,000,000 CAD) (Investments + House - Liabilities)	$ 4,230.94	$ 6142.44	$ 1911.50	0.61%  (Total)
Net Worth	$ 5,230.94	$ 7142.94	$ 1911.50	36%

(This chart is a modified version of Brien's 'Net Worth' chart from www.2millionblog.com. It is used with permission.)

Being made fun of for being frugal

Now, we have all been peer-pressured into buying something.
And when we say 'No, I'd rather not spend $100 on monster truck show tickets', our 'friends' retort:

"You're no fun!"

"You're too cheap!"

"You don't have a life!"



You're right, Jack! All my friends bug me and act like I'm a frugal fool!

It's happened to me too. Both of us know the pain of being ridiculed. So what can we do about this socioeconomic menace?


1) Try telling them the truth:

Tell them that that $100 is the water for your wealth-tree, with karma fueling it's ever-present upward climb...

Or, you could tell them that that $100 will let you retire 1 or 2 days earlier, while they are still slaving away at the 9 to 5.

Or maybe that $100 will be the last straw in the haystack that allows your future child to seek out the higher education that they always wanted.


2) Try telling them a lie:

Tell them that $100 is going to quintuple in the next 3 weeks, and you will be an overnight millionaire.

Tell them that you have to get an ass-transplant, and $100 is the last step towards the rear you've always wanted.


3) Ignore their idle financial prattle:

This is probably the most difficult, and effective tactic. It's a proven fact that friends poke fun because they want to get a reaction. By ignoring them, you rob them of the payoff of the activity.

No reaction -->  No reward


4) Show them your 5 page asset sheet, complete with lots of very large numbers:

... And watch them stammer as they wobble away to their fully-leveraged car and mortgaged-up-to-the-hilt condo.

I like this option BEST.

I thoroughly ENJOY the look on people's faces when they come to the realization that saving and investing soundly will beat the pants off of spending like you're going to die tommorrow.

I guess I'm sort of a jerk that way :-P.



Jack, they won't stop bugging me about being frugal, no matter what I do!

Well, you can always get new friends.

In-fact, go to www.meetup.com, and you can find lots of groups nearby you that share your interests, including being frugal.

It's nearly always free to go to meetings, and the people you find there can be incredibly supportive; after-all, they have probably been in the same situation as you!

An unofficial break

 Well, I am back.

I hadn't posted anything for nearly 2 weeks.

As with almost every other blog writer that 'lapses' on his or her duties, I will blame life, and it's infinite complexity.


What kept you so busy?

I have enrolled in a welding course, occurring on the weekends, and it is definitely a physically demanding task. I come back from the classes absolutely spent.

I have also started 'investing'!

I have put my money where my mouth is, and started buying quality dividend stocks. Between the 'stress' of a full-time job, and my welding course, and my investing on my off hours, I've been very tired. Add to that then I am starting to fit in some time at the gym, and still keep up with my writing group meetings (and actually contribute something)...

I am just exhausted all the time :P.


Why do you do so much work, Jack? You're wasting your life (and youth) away!

That's a very good point.

Should I really be doing all these activities?
Shouldn't I stop and smell the roses and all that?

Well, I like to think that I work hard early in my life, and try and fit in as much 'stuff' as possible, and then later in life, when money isn't as much of an issue, and I have more important things to worry about (like raising children), then I will start easing off on the 'stuff'.

We'll see how well all that goes. I'm thinking I'm wearing rose coloured glasses a bit there, instead of smelling roses.

A Tough Week, A Demanding Boss, & A Loss.

Well,

Jack's been having one hell of a week so far.


Monday
One of our oldest cats had been laying on the floor, in pain obviously. I petted him a bit before the girlfriend took him to the vet, and I left for work. I received a text message an hour later that he 'had' cancer. It wasn't even said that they put him down. I miss him immensely.

I felt awful at work. It was one of those day that just make you want to walk out the door, telling you boss that he needs to get the hell out of your way. And that every single customer that calls your phone is going to get sub-par service, even if you don't mean to take it out on them.

I went to my folks, and had a light dinner. I wasn't hungry. We talked about things, idle chatter, really, and it helped me feel a little better.


Tuesday
Labour work day, taking boxes up and downstairs. Frantic rushing to get orders done, working with parts that are flimsy and prone to break. Using tools purchased for price and not functionality.

I finally got the order done, a small prize in an otherwise agrivating day.


Wednesday
First thing, my boss comes down to tell me that I am not charging our customers enough for service calls. "Anything over 5 minutes is a $200 yearly contract!".

The products they call for support on are worth less then $500. Who in their right mind is going to pay almost half the cost of a product for support! They'll just buy a new one - from our competitors.

*shakes head*


On a lighter note,
I read 'The Richest man in Babylon' yesterday. It's quite a good (abet short) book about nuts and bolts financial success in ancient times. I liked the characters, and the morals are all pretty decent. I sometimes found the language difficult to decipher, and it would often get in the way of my understanding the events correctly. I would still recommend it, though.

I'm also reading "The Wealthy Barber" at the moment. I would likely agree with the general 'internet consensus' that it's required reading for those beginning in personal finance (or anyone over the age of 10).
 
It's books like these that can really provide some clear, easy-to-understand insight into personal finance. I would wholeheartedly recommend that anyone, and everyone, pick them up at the library or inexpensively online.

Working on the side: Pt.5

Over the last couple of days, I have written a fair amount about how I overreached with my business, and allowed my emotions to get the better of my business sense.

Today, I'll look at a few general tips that worked well for me, and helped me cope with my business 'underperforming' in my mind.

1)  The big one was taking my business performance too personally, and trying too hard.

I've found that this is a big mistake for a few reasons:

• You can't make people buy things from you. You can only make your 'product' as appealing as possible.
• In 'service' industries, you are called when you are needed, not when you are broke and need work to pay the rent.
• People often wait a very long time before having their belongings serviced - Often because they believe it can be more cost-effective to buy a new one, and throw the old one out.
• People may like you, and give your card out, but that doesn't guarantee any work, ever.

It's part waiting game, and part painful effort, made all the more difficult if you sit around and worry, or sweat every single second that you don't get work/calls/sales.

I realized that I was stressing myself sick, sounding desperate on calls, and advertising door-to-door, which I didn't want to do in the first place. So I made a decision.

2)  Start applying for jobs.

Not just any work though - I only applied for jobs that I could reasonably see myself doing, longer term, and without a ridiculous level of stress. I didn't want to burn out.

Part of the reason I had went to self-employment was a string of jobs at places where employee satisfaction was valued lower then the muck we swept off the floors. Staples was one such place.

So, I finally got my interview for my current position as a key & inventory management support specialist, and for all intensive purposes, it is leagues better then anything I've ever had before. The stress level is also manageable, so I can still take work on the side, and not let it frazzle me too badly

3)  A full-time /side business split means less money stress, more stability, and better earning without the risk.

I can't describe how great it feel to be able to put away that extra money from my side business, and place it in my 'future savings' account.

The strangest thing about the entire arrangement is that I am getting more side business work now, after I started a full-time job then ever before.

It's seems to be very true, at least in my case:

4)  People call more and pay more to busy people.

I have a friend that I will talk about tomorrow that is in the opposite position, through no fault of his own.




Do you have a side business that you enjoy?
Do you trust busy people more?
Let me know! :)

Working on the side: Pt.4

Last-day, I was just about at the bottom of my side business venture, or at least it sure as heck felt like it.

I had called in nearly all my prospects from my back-list of clients, without a single bite. I felt incredibly rejected, and din't really know what to do. My grandpa, one of my major mentors, had suggested that it was because I was in a 'reactive business'.


That is, 'Don't call your customers, they call you'.

I still wasn't satisfied with that. I still felt as through they had 'betrayed' me, and went with other service providers (pizza techs that work for nothing).

But then, out of the blue, a few days later, I get a call from one of my oldest clients. Seems he had 3 units that needed work done, and a 4th one built. I took the call, and made an appointment as professionally as I could, trying had to sound unsurprised that he had called me back.

He actually thanked me for calling him, and offering him such a good deal - He had recently had someone else do work for him (a bit cheaper then my rates, he admitted), but the work was shoddy, and he wasn't at all satisfied.

In fact, the other tech had up and disappeared on him when he had an issue, taking the money with him.

I honestly couldn't imagine doing that, considering how I was trying to make as good a reputation as possible. So, went to his home office, and performed the job. It took nearly 2 days with all the things that needed to be done, and he was positive during the whole thing, even when I handed him a healthy invoice.

He was happy to pay me because he knew I did good work.

I also handed him a few business cards, and asked him if he knew anyone else that needed work done. He said he did, and I should expect a call in the coming weeks.

So, I felt like a true entrepreneur again, a fat cheque in hand. It seems I was making my business much more dramatic then it had to be.

And that's really the secret of owning a business. It's not about emotions, or personal grudges, or feeling like you're being cheated.

For me, owning a successful business is about doing a solid, reliable job, and slowly growing your client base through excellent referrals and excellent workspersonship. This is the best way.

Today, I do not perform my business full time, or even what I would call part time. I simply get a few calls a week, and schedule them in when I am able to get to them. Most of my clients are more then happy to wait a bit longer.

Quite frankly, if you look busy, people will wait longer, and pay you more.

I tell my clients that I am booked up during nearly every day, and that I am only able to get to them after 5:00PM (When my day-job ends, but I do not tell them I have a day-job.). They always are very understanding, and we come to a compromise on when and where is best.

Tomorrow, I'll throw out some general tips about how I make my side business successful.





Do you have any tips for prospective entrepreneurs?
When was a time you let emotions over-run your business sense?
Let me know :)!

Working on the side: Pt.3

Last time I wrote about my side work, I had just bought my 'first pair of professional shoes' and was busily calling all my previous clients to drum up business.

It was at this point I was getting nowhere, fast.

I combed through my phone lists, categorizing people by the last time I had served them, and how much I charged. I attempted to recall if they seemed to like me or not. In my mind, it seemed like everyone liked me, as I was pleasant and helpful, and I gave them a good deal.

Yet, every person turned me down, and shied away from my services, even when I offered them for nearly free.

What was my problem? I couldn't believe that people wouldn't want to have my do work for them for free. I looked good, I brushed my teeth, and even brought magnets for their fridges, so they would always have my name and number.

I talked with my grandpa. He's basically about the nicest guy on the outside, but he dishes out the cold hard truth if you ask.

"You're trying too hard. People don't want you right now, and by pushing, you're pushing them away. Don't bother people when they don't need you. They'll bother you when they need you."

So, I was trying too hard, and pushing too hard. I was coming off like an overbearing salesman, trying to make a quick buck. I worried that I had ruined the few client contacts I'd had, crushing the tenuous lines of communication under my giant boot of irritating salesmanship.

But if I was offering my services for free, then why did they turn me down?

I wasn't going to make any money on the deal. In-fact I was going to lose money in gas and travel to go to these people's houses.

And if I didn't call people, how would they know I existed to request my services?

It was a catch-22.
I couldn't get work if I didn't contact them, and if I did contact them, I wouldn't get work. I was understandably distraught.

But most of all, I felt like a complete failure.

Where could I go from here?
I'll let you know tommorrow :).






Have you ever felt like a failure in your business?
How do you cope with the tough times?
Let me know :).