WEALTH
KEY ACTIONS - Earning, Saving, Investing, giving, spending
Basically what this page views as wealth is not just having in monetary terms but making the most out of ones assets such as real estate that continuously generate more and more income as life goes on. Being wealthy is something that is gradual not a get wealth quick scheme. It is possible once in a while to get rich quick from may be a bet, but nobody gets wealthy overnight without a considerable amount of discipline and effort (either by the person involved or someone else) being applied before the wealth is accumulated.
Wealth, in economics, an accumulation of goods having economic value.
Economic value has several characteristics. First, an object must have utility.
It must have, or be suspected of having, the capacity to satisfy some human
want. Wealth can be increased by discovering uses for things previously not
regarded as useful. Thus, the discovery of uses for petroleum in the 19th
century added enormously to wealth. Second, economic goods must be in scarce
supply. Air does not normally have economic value because it is freely
available. Air that is artificially conditioned is economically valuable,
however, because it is relatively scarce. Third, economic goods must be
transferable; that is, it must be possible to buy and sell them at definite
market prices. Finally, an object must have measurable economic value. Because
the only common unit of value today is money, the worth of goods must be
expressible in monetary terms. Some economists also regard a definite skill in
performing a job as human wealth, as such skill has a determinable market value.
Wealth must be distinguished from income. Both involve utility, scarcity, transferability, and measurability. Whereas wealth is an accumulation, a stock existing at a certain instant of time, income is a flow of goods and services during a certain period of time. Wealth may be regarded as a lake, and income as a stream flowing into and out of it.
A person's holdings of currency, bank balances, and other financial
instruments constitute personal wealth as distinct from national wealth.
Economists estimate wealth by measuring the actual physical stock of assets.
National wealth is the sum total of economic goods in the possession of the
national, state, and local governments; business and nonprofit institutions; and
the individual inhabitants of a country.
Microsoft® Encarta® Encyclopedia 2003. © 1993-2002 Microsoft Corporation. All
rights reserved.
7 Little Known Success Secrets Of The Rich & Famous
The Secrets Of The Rich & Famous:
(1) People Form Habits And Habits Form Futures
(2) The “Success Six”
(3) ‘Perfection’ Can Be The Enemy Of Success
(4) Guard Your Time Like A Hawk
(5) Go After The Carrot
(6) The Consistency Principle
(7) ‘Inch By Inch And Anything’s A Cinch’
Copyright © Clifford Mee – All Rights Reserved -
http://www.SuccessRichFamous.com
Forex Trading
Forex (foreign exchange) refers to the foreign currency
exchange market, the world’s largest financial trading
market. Pass yourself as a forex expert with these buzz
words:
• Bid – to buy
• Ask – to sell
• Liquidity – financial ease of transaction, i.e. cash
• Trading volume – the amount traded
• Bid/ask spread – the difference between the proposed
buying price and the actual selling price
• OTC – over the counter
• Exchange rate – the difference between currency values;
for instance, a Canadian dollar is valued at .86 of a US
dollar
• Hedge funds – large mutual funds companies that
control vast amounts of money and are able to
manipulate the value of a currency through speculation
• Central bank – the national bank of a nation, which
usually exerts control over the value of that currency
Forex trading is the investment in the currency of one
nation. Multinational Corporations doing business across
national boundaries find value in keeping their cash
reserves in a variety of countries, and holding their funds in
a myriad of ways.
THE 100 SIMPLE SECRETS OF Successful People David Niven, Ph.D.
1. Competence Starts with Feeling Competent 1
2. It’s Not How Hard You Try 3
3. Creativity Comes from Within 5
4. Take Small Victories 7
5. You Can’t Force Yourself to Like Broccoli 9
6. Resist the Urge to Be Average 11
7. There Is Plenty of Time 13
8. It’s Never Just One Thing 15
9. Don’t Keep Fighting Your First Battle 17
10. Change Is Possible, Not Easy 19
11. Seek Input from Your Opposites 21
12. Write Down the Directions 23
13. Anticipate Irrationality 25
14. The Best Defense Is to Listen 27
15. Winners Are Made, Not Born 29
16. Do Things in Order 31
17. Get Experience Any Way You Can 33
18. Self-Motivation Works Once 35
19. Speak Slowly 37
20. Where You Stand Depends on Where You Look 38
21. Use Your Own Self-Interest 40
22. Remember Who You Are and Where You Are 42
The 100 Simple Secrets of Successful People
23. Negotiate with Confidence, or Don’t 44
24. Volunteer to Feel Better 46
25. Remember the Task, Forget the Rankings 48
26. Avoid the Second-Guess Paralysis 50
27. Seek a Tall Plateau, Not the Peak 52
28. Play the Odds 54
29. The Past Is Not the Future 56
30. Get a Good Night’s Sleep 58
31. It Starts and Ends with You 60
32. Notice Patterns 62
33. Efficiency in Everything 64
34. Tomorrow Will Be a Better Day (But How Exactly?) 66
35. Lessons Can’t Threaten 68
36. Success Is Formula, Not Fantasy 70
37. You Need to Know More Than Just How Talented You Are 72
38. Role Models Are Not One Size Fits All 74
39. Learn from Losses 76
40. Embrace Work; It May Have to Last Forever 78
41. Exercise and Eat Right 80
42. Boredom Is the Enemy 82
43. Be Clear About Your Role in the Outcome 84
44. Make Change Count 86
45. Listening Is More Than Not Talking 88
46. Take Off Your Blinders 90
47. You’ll Get What You’re Afraid Of 92
48. Think About Who You Ought to Be 94
49. Leadership Is Contagious 96
50. Want Support? Deserve It 98
51. You Will Give Up Faster if You’re Not in Control 100
52. Life Is Not a Zero-Sum Game 102
53. You Don’t Have to Get Straight A’s Anymore 104
54. Whet Your Appetite for Success 106
55. Remember the Difference Between You and Everybody Else 108
56. Your Work and Home Lives Must Fit Together 110
57. Nobody Wins Without a Loser 112
58. Tell Clean Jokes 114
59. Don’t Want Everything 116
60. Look for Value 118
61. Get Your Motivation Where You Can Find It 120
62. Be an Expert 122
63. Failure Is Not Trying 124
64. You Are Not in This Alone 126
65. Your Goals Are a Living Thing 128
66. Avoid Roller-Coaster Emotions 130
67. Care 132
68. You Can’t Be Persistent Without Perspective 134
69. Changing Jobs Doesn’t Change You 136
70. It Might Get Worse Before It Gets Better 138
71. If You Don’t Believe, No One Else Will 140
72. You’ll Work Harder If You Feel Wanted 142
73. Don’t Talk to Yourself 144
74. Seek Coherence and Congruence 146
75. If You Doubt, You’re Out 148
76. Always Think About What’s Next 150
77. Value Practical Knowledge 152
78. See the Risk in Doing Nothing 154
79. Face Conflict Head-On 156
80. Money Isn’t Everything 158
81. Be Realistic About Yourself 160
82. Find Your Own Path162
83. Own What You Do 164
84. Be Honest for Your Future 166
85. You Need to Know What You Are Looking For 168
86. Don’t Forget Packaging 170
87. Learn to Lead Yourself 172
88. A Victory at All Costs Is Not a Victory 174
89. People Who Have It Right Work Harder to Make It Better 176
90. Don’t Run in the Wrong Direction Just Because You’re Near the Finish Line
178
91. Hope Springs Internal 180
92. Think as if Others Can Read Your Mind 182
93. You’ll Get Knocked Down and Then Get Back Up 184
94. Keep Your Goals Where You Can See Them 186
95. Don’t Settle 188
96. What Is the Point? 190
97. Win Your Own Respect First 192
98. Your Goals Must Engage All of You 194
99. Take Action 196
100. Only You Can Say if This Is a World You Can Succeed In 198
David Niven, Ph.D.
THE 48 LAWS OF POWER by Robert Greene and Joost Elfers
1 Never outshine the master.
2 Never put too much trust in friends, learn how to use enemies.
3 Conceal your intentions.
4 Always say less than necessary.
5 So much depends on reputation- guard it with your life.
6 Court attention at all cost.
7 Get others to do the work for you, but always take the credit.
8 Make other people come to you - use bait if necessary.
9 Win through your actions, never through argument.
10 Infection: avoid the unhappy and unlucky.
11 Learn to keep people dependent on you.
12 Use selective honesty and generosity to disarm your victim.
13 When asking for help, appeal to peoples self interest never to their mercy or gratitude.
14 Pose as a friend, work as a spy.
15 Crush your enemy totally.
16 Use absence to increase respect and honor.
17 Keep others in suspended terror cultivate an air of unpredictability.
18 Do not build fortresses to protect yourself - Isolation is dangerous
19 know who you're dealing with - do not offend the wrong person.
20 Do not commit to anyone.
21 Play a sucker to catch a sucker - seem dumber than your mark.
22 Use the surrender tactic, transform weakness into power.
23 Concentrate your forces.
24 Play the perfect courtier.
25 Re-create yourself.
26 Keep your hands clean.
27 Play on people's need to believe to create a cult like following.
28 Enter action with boldness.
29 Plan all the way to the end.
30 Make your accomplishments seem effortless.
31 Control the options: Get others to play with the cards you deal.
32 Play to people's fantasies.
33 Discover each man's thumbscrew.
34 Be royal in your own fashion: Act like a king to be treated like one.
35 Master the art of timing.
36 Disdain things you cannot have: Ignoring them is the best revenge.
37 Create compelling spectacles.
38 Think as you like but behave like others.
39 stir up water to catch fish.
40 Despise the free lunch.
41 Avoid stepping into a great man's shoes.
42 Strike the shepherd and the sheep will scatter.
43 Work on the hearts and minds of others.
44 Disarm and infuriate with the mirror effect.
45 Preach the need for change, but never reform too much at once.
46 Never appear too perfect.
47 Do not go past the mark you aimed for in victory, learn when to stop.
48 Assume formlessness.
1 Never outshine the master.
KJV Matthew 6:24 No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon.
KJV Matthew 24:10-12
10 Neither be ye called masters: for one is your Master, even Christ.
11 But he that is greatest among you shall be your servant.
12 And whosoever shall exalt himself shall be abased; and he that shall humble himself shall be exalted.
4 Always say less than necessary. (Bridle the tongue, quick to listen, slow to speak.)
KJV James 1: 26 If any man among you seem to be religious, and bridleth not his tongue, but deceiveth his own heart, this man's religion is vain.
KJV 1 Peter 3:10 For he that will love life, and see good days, let him refrain his tongue from evil, and his lips that they speak no guile:
KJV Proverbs 25: 23 The north wind driveth away rain: so doth an angry countenance a backbiting tongue
KJV Proverbs 25: 15 By long forbearing is a prince persuaded, and a soft tongue breaketh the bone.
KJV Proverbs 21: 23 Whoso keepeth his mouth and his tongue keepeth his soul from troubles.
KJV Proverbs 17: 20 He that hath a froward heart findeth no good: and he that hath a perverse tongue falleth into mischief.
KJV Proverbs 17: 4 A wicked doer giveth heed to false lips; and a liar giveth ear to a naughty tongue.
KJV Proverbs 15:4 A wholesome tongue is a tree of life: but perverseness therein is a breach in the spirit.
KJV Proverbs 10:31 The mouth of the just bringeth forth wisdom: but the froward tongue shall be cut out.
KJV Proverbs 6:16-17
16 These six things doth the LORD hate: yea, seven are an abomination unto
him:
17 A proud look, a lying tongue, and hands that shed innocent blood,
6 Court attention at all cost. (How does wisdom look like?, Who has seen GOD the FATHER. What about Wisdom, love, knowledge, vision, etc)
KJV John 1:18 No man hath seen God at any time; the only begotten Son, which is
in the bosom of the Father, he hath declared him.
KJV 1 John 4:12 No man hath seen God at any time. If we love one another, God dwelleth in us, and his love is perfected in us
KJV 3 John 1: 11 Beloved, follow not that which is evil, but that which is good. He that doeth good is of God: but he that doeth evil hath not seen God.
11 Learn to keep people dependent on you. (JOY, Happiness and prosperity come from GOD)
20 Do not commit to anyone. (Commit to GOD, He make independent and brings mastery)
22 Use the surrender tactic, transform weakness into power. (Live to fight another day)
25 Re-create yourself. (Not conformed to this world but renewing your mind.)
KJV Romans 12:1-2
1 I beseech you therefore, brethren, by the mercies of
God, that ye present your bodies a living sacrifice, holy, acceptable unto God,
which is your
reasonable service.
2 And be not conformed to this world: but be ye transformed by the renewing of
your mind, that ye may prove what is that good, and acceptable, and perfect,
will of
God.
26 Keep your hands clean. (Do no evil/ repent for evils done.)
KJV Deuteronomy 19: 20 And those which remain shall hear, and fear, and shall henceforth commit no more any such evil among you.
KJV Jeremiah 4: 22 For my people is foolish, they have not known me; they are sottish children, and they have none understanding: they are wise to do evil, but to do good they have no knowledge
KJV Jeremiah 18:12 And they said, There is no hope: but we will walk after our own devices, and we will every one do the imagination of his evil heart.
KJV 2 Corinthians 13: 7 Now I pray to God that ye do no evil; not that we should appear approved, but that ye should do that which is honest, though we be as reprobates.
27 Play on people's need to believe to create a cult like following. (Man created to worship God. In His absence, man worshipped anything.)
KJV Romans 1:21-23
21 Because that, when they knew God, they glorified him
not as God, neither were thankful; but became vain in their imaginations, and
their foolish heart was darkened.
22 Professing themselves to be wise, they became fools,
23 And changed the glory of the uncorruptible God into an image made like to
corruptible man, and to birds, and fourfooted beasts, and creeping things.
28 Enter action with boldness. (Count the cost before committing to follow Jesus)
KJV Matthew 10:337-39
37 He that loveth father or mother more than me is not
worthy of me: and he that loveth son or daughter more than me is not worthy of
me.
38 And he that taketh not his cross, and followeth after me, is not worthy of
me.
39 He that findeth his life shall lose it: and he that loseth his life for my
sake shall find it.
KJV Romans 8: 18 For I reckon that the sufferings of this present time are not
worthy to be compared with the glory which shall be revealed in us.
33 Discover each man's thumbscrew. (They defeated evil by the blood of the lamb and the word of his testimony)
KJV Revelation 12:11 And they overcame him by the blood of the Lamb, and by the word of their testimony; and they loved not their lives unto the death.
34 Be royal in your own fashion: Act like a king to be treated like one.
KJV Matthew 5:1-16
1 And seeing the multitudes, he went up into a mountain:
and when he was set, his disciples came unto him:
2 And he opened his mouth, and taught them, saying,
3 Blessed are the poor in spirit: for theirs is the kingdom of heaven.
4 Blessed are they that mourn: for they shall be comforted.
5 Blessed are the meek: for they shall inherit the earth.
6 Blessed are they which do hunger and thirst after righteousness: for they
shall be filled.
7 Blessed are the merciful: for they shall obtain mercy.
8 Blessed are the pure in heart: for they shall see God.
9 Blessed are the peacemakers: for they shall be called the children of God.
10 Blessed are they which are persecuted for righteousness' sake: for theirs is
the kingdom of heaven.
11 Blessed are ye, when men shall revile you, and persecute you, and shall say
all manner of evil against you falsely, for my sake.
12 Rejoice, and be exceeding glad: for great is your reward in heaven: for so
persecuted they the prophets which were before you.
13 Ye are the salt of the earth: but if the salt have lost his savour, wherewith
shall it be salted? it is thenceforth good for nothing, but to be cast out, and
to be trodden
under foot of men.
14 Ye are the light of the world. A city that is set on an hill cannot be hid.
15 Neither do men light a candle, and put it under a bushel, but on a
candlestick; and it giveth light unto all that are in the house.
16 Let your light so shine before men, that they may see your good works, and
glorify your Father which is in heaven
KJV Revelation 17:14 These shall make war with the Lamb, and the Lamb shall
overcome them: for he is Lord of lords, and King of kings: and they that are
with him are called, and
chosen, and faithful.
KJV Revelation 19:16 And he hath on his vesture and on his thigh a name written,
KING OF KINGS, AND LORD OF LORDS.
35 Master the art of timing. (Haraka haraka haina baraka. A kiswahili proverb that directly translates to hurry hurry has no blessing)
36 Disdain things you cannot have: Ignoring them is the best revenge.
KJV Proverbs 13:5-6
5 A righteous man hateth lying: but a wicked man is loathsome, and cometh to shame.
6 Righteousness keepeth him that is upright in the way: but wickedness overthroweth the sinner.
KJV Proverbs 6:16-21
16 These six things doth the LORD hate: yea, seven are an abomination
unto him:
17 A proud look, a lying tongue, and hands that shed innocent blood,
18 An heart that deviseth wicked imaginations, feet that be swift in running to
mischief,
19 A false witness that speaketh lies, and he that soweth discord among
brethren.
20 My son, keep thy father's commandment, and forsake not the law of thy mother:
21 Bind them continually upon thine heart, and tie them about thy neck.
KJV Proverbs 28: 9 He that turneth away his ear from hearing the law, even his prayer shall be abomination.
KJV Proverbs 21:27-28
27 The sacrifice of the wicked is abomination: how much more, when he
bringeth it with a wicked mind?
28 A false witness shall perish: but the man that heareth speaketh constantly.
KJV Proverbs 16:12 It is an abomination to kings to commit wickedness: for the throne is established by righteousness.
KJV Proverbs 16: 5 Every one that is proud in heart is an abomination to the LORD: though hand join in hand, he shall not be unpunished.
41 Avoid stepping into a great man's shoes. (Be greater)
KJV Matthew 23: 11-12
11 But he that is greatest among you shall be your
servant.
12 And whosoever shall exalt himself shall be abased; and he that shall humble
himself shall be exalted.
42 Strike the shepherd and the sheep will scatter. (Garden of Gethsemane Jesus is arrested Mark 14:43-52)
KJV Mark 14:43-52
43 And immediately, while he yet spake, cometh Judas, one of the twelve, and with him a great multitude with swords and staves, from the chief priests and the scribes and the elders.
44 And he that betrayed him had given them a token, saying, Whomsoever I shall kiss, that same is he; take him, and lead him away safely.
45 And as soon as he was come, he goeth straightway to him, and saith, Master, master; and kissed him.
46 And they laid their hands on him, and took him.
47 And one of them that stood by drew a sword, and smote a servant of the high priest, and cut off his ear.
48 And Jesus answered and said unto them, Are ye come out, as against a thief, with swords and with staves to take me?
49 I was daily with you in the temple teaching, and ye took me not: but the scriptures must be fulfilled.
50 And they all forsook him, and fled.
51 And there followed him a certain young man, having a linen cloth cast about his naked body; and the young men laid hold on him:
52 And he left the linen cloth, and fled from them naked.
Stephen Covey's best-selling book The 7 Habits of Highly Effective People.
He says that these basic principles of effectiveness may be found in all world religions; and it can be noted that many highly successful people seem to have naturally developed them.
Habit 2 - Begin with the End in Mind
Habit 4 - Think Win Win
Habit 5 - Seek First to Understand then be Understood
Habit 6 - Synergize (Synergise)
Habit 7 - Sharpen the Saw -Spiritual Exercise, Physical Exercise, Mental Exercise, Interpersonal
If you want to be extremely successful in business or very happy in life or achieve some large goal, then being effective is consistently doing the things that will bring about the results you are after.
Following the amazing popularity of his work on The 7 Habits of Highly Effective People, Stephen Covey published a second book that deals with the 7 Habits; and the title of that book is also First Things First. Both the book and this habit deal with subject of managing your time effectively.
The 21 Secrets to Succeeding When It Matters
Most - Brian Tracy
Chapter 1 Stay Calm 6
Chapter 2 Be Confident in Your Abilities 11
Chapter 3 Dare to Go Forward 14
Chapter 4 Get the Facts 18
Chapter 5 Take Control 22
Chapter 6 Cut Your Losses 27
Chapter 7 Manage the Crisis 31
Chapter 8 Communicate Constantly 35
Chapter 9 Identify Your Constraints 41
Chapter 10 Unleash Your Creativity 45
Chapter 11 Focus on Key Result Areas 50
Chapter 12 Concentrate on Priorities 55
Chapter 13 Counterattack! 59
Chapter 14 Generate Cash Flow 63
Chapter 15 Care for Your Customers 68
Chapter 16 Close More Sales 74
Chapter 17 Keep Things Simple 80
Chapter 18 Conserve Your Energy 88
Chapter 19 Make Your Connection 94
Chapter 20 Character Is King 99
Chapter 21 Pull It All Together 105
The Brian Tracy eBook - Principles Of Success
Chapters
• A Balanced Life
• Becoming A Person Of Integrity
• Cultivating Your Self-Esteem
• Empowering Others
• Everyone’s A Sales Person
• Gaining Visibility
• Generating Energy
• Leading & Motivating
• Make Every Minute Count
• Making The Most Of Change
• Managing Your Time
• Setting Priorities
• The Power Of Charisma
• The Power Of Positive Self Talk
The 100 Simple Secrets Of Successful People - David Niven, Ph.D
What Scientists Have Learned and How You Can Use It
THINK and GROW RICH by Napoleon Hill
Time Management - Marc Mancini
101 Internet Businesses You Can Start From Home by Susan Sweeney, C.A.
177 Mental Toughness Secrets of the world class by steve seibold
The Greatest Money-Making
Secret in History! by Joe Vitale
Author of the #1 best-seller, Spiritual Marketing,
and way too many other books to list here
KJV 2 Corinthians 9: 7 Every man according as he purposeth in his heart, so let him give; not grudgingly, or of necessity: for God loveth a cheerful giver.
BobBrinker.com (www.bobbrinker.com
The Intelligent Investor, by Benjamin Graham (HarperBusiness Essentials)
Investing For Dummies, 5th Edition, by Eric Tyson, MBA, and Value Investing For Dummies, 2nd Edition, by Peter J. Sander, MBA, and Janet Haley (both published by Wiley)
The Science of Getting Rich, by Wallace D. Wattles (Tarcher)
Think and Grow Rich, by Napoleon Hill (Wilder)
Many of the most financially successful people are not
necessarily people who have creative ideas; many of them often just copy other
people’s ideas and turn the idea into millions
or even billions of dollars. Fashion designers watch young kids to see what new
fashions they are wearing, and then they simply mass-produce those fashions.
Bill
Gates did not invent the operating system that made him the richest man in the
world. He simply bought the system from the computer programmers who did
invent it and then licensed their product to IBM. The rest is history.
Amazon.com
simply took Sam Walton’s idea for Wal-Mart and put it on the Internet; Jeff
Bezos
became rich much more quickly than Sam Walton. In other words, who says you
need to have creative ideas to be rich? You just need to be better at the B-I
Triangle and at taking ideas and turning them into riches.
In today’s ever-changing world, the most important
investment you can make is an investment in on-going education and searching for
new ideas. So keep searching, keep challenging your old ideas. One of the main
points of this book is that you have the power to create a world of not enough
money as well as a world of an abundance of money. In order to create a world of
an abundance of money it does require a degree of creativity, a
high standard of financial and business literacy, seeking opportunities rather
than
seeking more security, and to be more cooperative instead of competitive.
When a person has money, they suddenly begin receiving phone calls from stockbrokers, real estate brokers, and investment brokers. Rich dad also had a joke about brokers, “The reason they are called ‘brokers’ is because they are broker than you.” My apologies to any “brokers” who are offended, but I think my rich dad’s stockbroker is the one who told the joke to him originally.
“I use my expenses to get richer and richer and the average person uses their expenses to become poorer and poorer.”
From RICH DAD’S GUIDE TO INVESTING - Robert and Kim Kiyosaki, Sharon Lechter
Why You Should Never JUST Work for Money [Top 5 Reasons]
Why do you do what you do for a living? If you say that you love what you do,
you are lucky. Only a small minority can actually claim to be happy doing what
they do.
Most people will say they do their job for the money. They would ideally want to
do something different but they believe they have to stay and do more of the
same to get that income. Here are the top 5 reasons you should not just chase
those dollar bills:
1. You will never make enough
There will never be enough hours in the day to earn enough if you are not having
your money work for you. There is only so much one individual can do in a job
and this is what you will be paid for. You can only be paid for the work you are
doing and never earn passive income. Being employed is very much “the more you
put in, the more you get out” when in fact you could put less in and get more
out if you only knew how to. Starting a business on the side, investing in the
markets or in real estate, creating work that will generate royalties will allow
you to make passive income. This will in turn free you up to focus on what you
really enjoy in life. Your day job will not make you wealthy and will not open
you up to new opportunities outside of your day to day tasks.
2. The debt spiral
Being in the rat race and keeping up with the Joneses will lead to the
accumulation of debt. It starts with paying for a university degree to get a
job. Once you have the job you want to buy a house. The house is bought for the
bank’s money and you are now locked in to a lifetime of debt. On top of this you
have financing for a new kitchen, the better car, the exotic vacations and
obviously all kinds of spending on credit cards. As a rule of thumb, the higher
the income an individual has , the higher the spending and the debt leveraging
they will engage in. This becomes a vicious circle where you can end up just
chasing your own tail by every month getting you pay check and straight away pay
interest on your debt. It may feel like you are treading water at times when
chasing the money. At the end of the day, your job is only a temporary solution
for paying off your debt.
3. Taxation
However you look at it, employees will always have the highest tax burden in any
society. The rate of tax is standardized and the people with jobs will
invariably have to pay for the people without jobs. The taxes are taken both
from your income and the payroll tax for your employer, effectively taxing you
twice. If you were to own a business or be a full time investor, the tax rate
would be lower and the system will allow you to make deductions and postpone
paying tax. The tax system is designed like this to stimulate business and
entrepreneurship. By demanding less tax, the government is in a sense rewarding
the individual willing to take the risk of running their own business. As the
employee takes less risk, they have to pay higher tax. If you are looking to
make money from working, being an employee is the worst place you can be from a
taxation point of view.
4. Risk of stagnation
When you are only chasing money, you are less likely to learn and develop in
your job. If you are in the comfort zone and making the level of money that you
feel is fair, you are on cruise control down the path of least resistance. You
will be exposed to less business scenarios and environments, disabling you to
develop the deep problem solving skills that you will need to make money outside
of your job. Look at the people in your office and ask yourself who are going
places and who the journeymen are. I would venture to guess that the former will
be the learners and are enabling themselves to create their own destiny, the
latter will run on empty and will run the risk of being laid off one day.
5. You become a slave to money
If you are controlled by money as opposed to controlling money, you will never
be happy. In the real world, 9 out of 10 employees will work just in order to
make ends meet. We lead our lives in fear of losing our jobs, not being able to
provide for a family and so on. Fear is very destructive and will lead to risk
aversion, meaning it will be very difficult to persuade you to take the plunge
and let your money work for you. Instead, you are likely to be angry and blame
others for the fact that you do not have enough money. Blaming your manager for
not increasing your salary is only a projection of the anger you have toward
yourself for not creating value on your own. By harnessing money and having it
work for you, you will be emancipated and in control.
OK, I get it so what should I work for then?
Instead of working for money, you need to aim to get to a stage where money
works for you. Have a look at the well-to-do, they would only take a job to
acquire assets of some sort. This could mean acquiring the knowledge of a
job/company/industry so they can replicate it. It could mean obtaining the
financial intelligence to realize how to beat the system and become the person
at the top shaving off profits from the system every day. You should be working
to develop assets, be that real estate, stocks and shares or even investing in
fine wines. Your aim should be to move up the value chain of life and change
from being employed to being a business owner or investor. This way you can earn
a passive income without any continuous effort.
Bottom line
This article is not about you quitting your job, merely to open your eyes and
shift your expectations to different opportunities of wealth creation out there.
If you are not happy in your job, you should consider learning how to invest
your money or even how to start up a part time business that can lead to passive
income. These actions are likely to be more lucrative than simply putting more
work in your current job and hoping for a pay raise.
What are your thoughts on working for money vs. learning to create income
yourself?
What do you want from your investments? Are you looking to start a business? Retire strong? Build on a family legacy?
"Don’t pay attention to anyone who promises to make you rich quick."
1. Budget
2. Get Out of Debt
3. Save Your Money
As a younger investor, you have more years ahead of you to weather the ups and downs of the market, more possibilities for your money to compound and potentially a greater share of your income to invest, since you may have fewer financial obligations.
Higher risk equals higher reward, right? Nope. Higher risk equals higher potential for reward, a big difference. Stocks are riskier than bonds.
One of the biggest differences between the wealthy and the not as wealthy is that the wealthy people earn interest and everyone else pays interest. It is important to realize that money is a tool that can help you to achieve your goals. In order for you to reach true financial independence you need to have your money begin to work for you--not you for it.
Fixed-income investments, usually bonds, are a form of debt. When you buy a bond you are making a loan to a company, government or governmental agency that borrows the funds for a defined period of time at a specified interest rate. Maturities range from one day to 30 years. Traditionally, bonds offer lower risk and returns than stocks.
Equities, usually stocks, provide an investor with an ownership stake in a company. The return on your investment will come from dividend payments and growth in the value of the stock if the company is profitable.
Alternative investments, which include everything that is not cash, bonds or stocks, include real estate, commodities and hedge funds, to name a few. These long-term investments can help diversify your portfolio because they behave differently from stocks and bonds.
The Facts
ü Investing is the process of placing money into a security, such as a stock, bond, or mutual fund, and letting it grow over time.
ü Individuals invest their money to offset its loss in value due to inflation, which is the rate at which the prices of goods and services change over time.
ü The earlier money is invested, the better. That’s because the longer money has to compound, or build growth upon growth, the greater its value can increase. And for young investors, although strapped for cash, time is always free.
ü Return is the profitability of an investment over time. It’s found by dividing the profit by the total amount of an investment and is typically expressed as a percentage rate.
ü Risk is the chance that the value of an investment will be diminished or lost over time due to circumstances of forces beyond your control.
ü In the investing world, risk and return go hand in hand. To obtain a higher rate of return on an investment, an investor must increase her or his risk. The lower the risk of an investment, the lower its return.
ü Before investing, it is critical to determine your risk tolerance and aversion. Selecting investments that match these personal preferences is important for a number of reasons, including wise money management and a good night’s rest.
ü There are a number of different investment and savings options that an individual can explore. On the savings front, there are
o savings accounts,
o certificates of deposit and
o
money market accounts.
On the investing end, there are
o corporate stocks,
o bonds,
o mutual funds and
o Treasury securities.
Investing for Retirement
ü Retirement may seem like a long way off, but to accumulate the amount of money you will need, it’s important to start saving now. The current entitlement programs like Social Security and Medicare that provide income and benefits to senior citizens will probably not be around in their current form for us because of demographic changes that may seriously weaken or bankrupt the system.
ü Congress has created two ways for individuals to save for retirement now. They are known as
o (1) employer-sponsored retirement plans, such as 401(k)s, and
o (2) Individual Retirement Accounts (IRAs).
ü Accounts, such as 401(k)s, allow employees to contribute money tax-deferred. That means the money that goes into the account – as well as the growth of the account itself – is exempt from taxes until some point in the future, usually retirement. The advantage to this is that it decreases an individual’s taxable income and enables the investment to compound more quickly.
ü Employers have the option to match some or all of the money contributed by the employee.
ü The employee does not own the money contributed by the employer to this account until he or she is vested. There are two kinds vesting;
o Cliff vesting is when you can keep 100 percent of the employer – contributed money at the end of a predetermined length of service, say five years.
o Graded vesting is when you gradually become vested between a certain number of years. An employee’s contributions are always 100 vested.
ü Money invested into a 401(k) may go into a number of options, including mutual funds or company stock. It’s important to select an investment option that matches your needs and risk tolerance.
ü Money contributed to a 401(k) is for long-term use. In general, therefore, any money taken out before age 59 is subject to a 10 percent early withdrawal penalty and all applicable taxes.
ü It is possible to access money in a 401(k) for what’s known as financial hardship. The tax code recognize four specific hardships:
o unreimbursable medical expenses,
o purchase of a primary residence,
o payment of post-secondary tuition for you or a dependent for the next year,
o
or to prevent eviction from or
foreclosure on your home.
Hardship withdrawals are still subject to the 10 percent early withdrawal
penalty as well as taxes.
ü There are certain circumstances in which you are exempt from the 10 percent early withdrawal penalty.
o These are severance of service from your company,
o if over the age of 55,
o disability,
o or death.
ü An individual may take out a loan against the balance of his or her 401(k) plan. The advantage to doing so is that the interest rate is often below that of the commercial bank, and the interest payments go back to you instead of being lost to a bank or credit union.
ü When leaving a job where you’ve opened a 401(k), there are several options of what to do with the plan. They can include
o keeping the money in the account where it is,
o moving the money into the 401(k) of a new company,
o rolling the funds into an IRA,
o
or cashing out the account
altogether.
That last option requires that the investor pay an early withdrawal penalty and
all applicable taxes.
ü IRAs are also tax-deferred accounts that can be opened through
o banks,
o mutual funds companies,
o insurance firms, and
o other institutions.
ü Individuals can make contributions of up to $2000 a year or 100 percent of their salary (whichever is less) to an IRA. These contributions are fully tax deductible in the two following situations:
o (1) You are not covered by a company retirement plan
o (2) you are covered under a company plan but are single and have adjusted gross income of less than $25,000, or married and have a joint adjusted gross income of less than $40,000
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BIBLICALLY. TRUE WEALTH IS A BLESSING FROM GOD.
KJV Proverbs 10:22 The blessing of the LORD, it maketh rich, and he addeth no sorrow with it.
KJV Joshua 1:8 This book of the law shall not depart out of thy mouth; but thou shalt meditate therein day and night, that thou mayest observe to do according to all that is written therein: for then thou shalt make thy way prosperous, and then thou shalt have good success.
Major People were wealthy in the bible.
Abraham had to separate from lot because their cattle were so many that the herds men began fighting for grazing land.
Solomon had so much wealth he could afford to maintain Over 999 women several with children and servants.
Job was so wealthy that even the devil got jealous and went to accuse him before GOD.
Isaiah had a wealth of prophetic utterances. For a sample visit the Isaiah page on this site or http://www.spiritlessons.com/Documents/Isaiah_53.pdf
Joseph became the second in command in Egypt which at the time was seen to rule the world. The nations of the world were starving and went to Joseph to get fed.
As much as the bible does speak of being wealthy on earth it also states that true wealth is not seen and not stored in this world. A wise man would be considered wealthier than a fool (KJV Psalm 14:1) regardless of how much the fool has.
KJV Psalm 24:1-5
1 {A Psalm of David.} The earth is the LORD'S, and the fulness thereof; the world, and they that dwell therein.
2 For he hath founded it upon the seas, and established it upon the floods.
3 Who shall ascend into the hill of the LORD? or who shall stand in his holy place?
4 He that hath clean hands, and a pure heart; who hath not lifted up his soul unto vanity, nor sworn deceitfully.
5 He shall receive the blessing from the LORD, and righteousness from the God of his salvation.
Haggai 2:8 The silver is mine, and the gold is mine, saith the LORD of hosts.
KJV Malachi 3:8-12
8 Will a man rob God? Yet ye have robbed me. But ye say, Wherein have
we robbed thee? In tithes and offerings.
9 Ye are cursed with a curse: for ye have robbed me, even this whole nation.
10 Bring ye all the tithes into the storehouse, that there may be meat in mine
house, and prove me now herewith, saith the LORD of hosts, if I will not open
you the
windows of heaven, and pour you out a blessing, that there shall not be room
enough to receive it.
11 And I will rebuke the devourer for your sakes, and he shall not destroy the
fruits of your ground; neither shall your vine cast her fruit before the time in
the field, saith
the LORD of hosts.
12 And all nations shall call you blessed: for ye shall be a delightsome land,
saith the LORD of hosts.
(Not that the store house in verse 10 is not some conmen preachers that are selling mansions in heaven, the ministries one is involved in should be Godly, that is centered)
KJV Matthew 6:1-4
1 Take heed that ye do not your alms before men, to be seen of them: otherwise ye have no reward of your Father which is in heaven.
2 Therefore when thou doest thine alms, do not sound a trumpet before thee, as the hypocrites do in the synagogues and in the streets, that they may have glory of men. Verily I say unto you, They have their reward.
3 But when thou doest alms, let not thy left hand know what thy right hand doeth:
4 That thine alms may be in secret: and thy Father which seeth in secret himself shall reward thee openly.
• LUKE 16:19-30 THE RICH MAN AND LAZARUS, PARABLE OF HEAVEN AND HELL
• 3 JOHN 1:2 GOD WANTS PROSPERITY, HEALTH IN (SOUL) AND OUT
KJV 3 John 1:2 Beloved, I wish above all things that thou mayest prosper and be in health, even as thy soul prospereth.
• 1 TIMOTHY 6:3-10, HOSEA 4:6 MATERIALISM TEACHINGS AND EVIL LOVE DESIRE THAT MAY LEAD TO PAIN AND DEATH (PHYSICALLY AND SPIRITUALLY TO A STATE THAT ONE CANNOT REACH GOD. ) WEALTH IS NOT GODLINESS, UN HOLLY PEOPLE GET WEALTHY TOO.
• 1 CORINTHIANS 10:24 SEEK WEALTH TO SHARE WITH OTHERS
KJV 1 Corinthians 10:24 Let no man seek his own, but every man another's wealth.
KJV Matthew 6:19-21
19 Lay not up for yourselves treasures upon earth, where moth and rust doth
corrupt, and where thieves break through and steal:
20 But lay up for yourselves treasures in heaven, where neither moth nor rust
doth corrupt, and where thieves do not break through nor steal:
21 For where your treasure is, there will your heart be also.
KJV Matthew 6:24-34
KJV Philippians 4: 19-20
19 But my God shall supply all your need according to his riches in glory
by Christ Jesus.
20 Now unto God and our Father be glory for ever and ever. Amen
Page still under construction, yet to add methods of getting wealthy physically and spiritually in today's economy. Some of the information to be covered include:
Still to come:
E: Employee — Working for someone else
S: Self-employed or Small business owner — Where a person owns his own job and
is his own boss.
B: Business owner — Where a person owns a "system" of making money, rather than
a job to make money.
I: Investor — Spending money in order to receive a larger payout in return.
OPM – Other People’s Money
Real Estate Investing
Get Out of Debt
Business Plan
Financial intelligence
Save to buy more and more assets.
Expert financial advisors: tax accountants, real estate brokers, bankers,
attorneys, and investors. Good Financial Advice
Financial statements
Purchasing
Your greatest "wealth" is not money
Your Own Corporation
Asset
Business
Spend Discretionary Income Wisely
Savings Plans
Investment Club
Investment Educational
Make Your Money Hard To Reach
Risk Management
Waste is a thief
Start Investing Earlier Rather Than Later
Build a Team
Financial Education
Put Your Wealth Building On Auto-Pilot
Tax Deferred
Have fulfilling lives with the health and wealth to enjoy.
“Goals that are not written down are just wishes . . .”
Many studies show that those who write down their goals will accomplish significantly more than those who do not. However, writing down your goals is just the first step in achieving them. Just as important as writing them down is revisiting and reevaluating them.
Why Do Rich People Go Bankrupt?
Health is Wealth
"None was sick or fible among them" referring to those that fed on manna in the desert. What represents the manna today?
KJV Psalm 34:10 The young lions do lack, and suffer hunger: but they that seek the LORD shall not want any good thing.
HUMOUR
Borrow money from pessimists--they don't expect it back
Take her somewhere expensive
Girlfriend always complains that don’t take her anywhere expensive.. So take
her to the Petrol Station.
http://www.txt2nite.com/take-her-somewhere-expensive.html
Jokes Home : True Humor : Love, Wealth and Success
A woman came
out of her house and saw 3 old men with long white beards sitting in her front
yard. She did not recognize them. She said "I don't think I know you, but you
must be hungry. Please come in and have something to eat."
"Is the man of the house home?", they asked.
"No", she replied. "He's out."
"Then we cannot come in", they replied.
In the evening when her husband came home, she told him what had happened.
"Go tell them I am home and invite them in!"
The woman went out and invited the men in"
"We do not go into a House together," they replied.
"Why is that?" she asked.
One of the old men explained: "His name is Wealth," he said pointing to one of
his friends, and said pointing to another one, "He is Success, and I am Love."
Then he added, "Now go in and discuss with your husband which one of us you want
in your home."
The woman went in and told her husband what was said. Her husband was overjoyed.
"How nice!!" he said. "Since that is the case, let us invite Wealth. Let him
come and fill our home with wealth!"
His wife disagreed. "My dear, why don't we invite Success?"
Their daughter-in-law was listening from the other corner of the house. She
jumped in with her own suggestion: "Would it not be better to invite Love? Our
home will then be filled with love!"
"Let us heed our daughter-in-law's advice," said the husband to his wife.
"Go out and invite Love to be our guest."
The woman went out and asked the 3 old men, "Which one of you is Love? Please
come in and be our guest."
Love got up and started walking toward the house. The other 2 also got up and
followed him. Surprised, the lady asked Wealth and Success: "I only invited
Love, Why are you coming in?"
The old men replied together: "If you had invited Wealth or Success, the other
two of us would've stayed out, but since you invited Love, wherever He goes, we
go with him. Wherever there is Love, there is also Wealth and Success!!!!!!"
Courtesy of http://www.eforu.com
Oil
Two old friends met one day after many years. One attended college, and now was
very successful. The other had not attended college and never had much ambition.
The successful one said, "How has everything been going with you?"
"Well, one day I opened the Bible at random, and dropped my finger on a word and
it was oil. So, I invested in oil, and boy, did the oil wells gush. Then another
day I dropped my finger on another word and it was gold. So, I invested in gold
and those mines really produced. Now, I'm as rich as Rockefeller."
The successful friend was so impressed that he rushed to his hotel, grabbed a
Gideon Bible, flipped it open, and dropped his finger on a page.
He opened his eyes and his finger rested on the words, "Chapter Eleven."
Preachers dying wish
An old preacher was dying. He sent a message for his banker and his lawyer, both
church members, to come to his home.
When they arrived, they were ushered up to his bedroom. As they entered the
room, the preacher held out his hands and motioned for them to sit on each side
of the bed. The preacher grasped their hands, sighed contentedly, smiled, and
stared at the ceiling.
For a time, no one said anything.Both the banker and lawyer were touched and
flattered that the preacher would ask them to be with him during his final
moments. They were also puzzled; the preacher had never given them any
indication that he particularly liked either of them. They both remembered his
many long, uncomfortable sermons about greed, covetousness, and avaricious
behavior that made them squirm in their seats.
Finally, the banker said, "Preacher, why did you ask us to come?"
The old preacher mustered up his strength and then said weakly, "Jesus died
between two thieves, and that's how I want to go."
Courtesy of http://www.makeitclearnow.org
Wealth?
One day a father of a very wealthy family took his son on a trip to the country
with the firm purpose of showing his son how poor people live. They spent a
couple of days and nights on the farm of what would be considered a very poor
family.
On their return from their trip, the father asked his son, "How was the trip?"
"It was great, Dad."
"Did you see how poor people can be?" the father asked.
"Oh, yeah," said the son.
"So what did you learn from the trip?" asked the father.
The son answered, "I saw that we have one dog and they had four." "We have a
pool that reaches to the middle of our garden and they have a creek that has no
end."
"We have imported lanterns in our garden and they have the stars at night."
"We have a small piece of land to live on and they have fields that go beyond
our sight."
"We have servants who serve us, but they serve others."
"We buy our food, but they grow theirs."
"We have walls around our property to protect us, they have friends to protect
them."
With this the boy's father was speechless. Then his son added,
"Thanks, dad, for showing me how poor we are."
Too many times we forget what we have and concentrate on what we don't have.
What is one person's worthless object is another's prize possession.
It is all based on one's perspective.
Take joy in ALL you have, especially your friends.
Courtesy of http://www.theblackriver.net
Wealth, Wisdom or Beauty
An angel appears at a faculty meeting and tells the dean that in return for his
unselfish and exemplary behavior, the Lord will reward him with his choice of
infinite wealth, wisdom, or beauty.
Without hesitating, the dean selects infinite wisdom.
"Done!" says the angel, and disappears in a cloud of smoke and a bolt of
lightning.
Now, all heads turn toward the dean, who sits surrounded by a faint halo of
light.
One of his colleagues whispers, "Say something."
The dean sighs and says, "I should have taken the money."
http://www.jokebuddha.com
Work vs. Prison
Just in case you ever got the two mixed up. This should make things a bit
clearer.
IN PRISON: you spend the majority of your time in an 8X10 cell.
AT WORK: you spend the majority of your time in a 6X8 cubicle.
IN PRISON: you get three meals a day.
AT WORK: you only get a break for one meal and you pay for it.
IN PRISON: you get time off for good behavior.
AT WORK: you get more work for good behavior.
IN PRISON: the guard locks and unlocks all the doors for you.
AT WORK: you must carry around a security card and open all
the doors for yourself.
IN PRISON: you can watch TV and play games.
AT WORK: you get fired for watching TV and playing games.
IN PRISON: you get your own toilet.
AT WORK: you have to share with some idiot who pees on the seat.
IN PRISON: they allow your family and friends to visit.
AT WORK: you can't even speak to your family.
IN PRISON: the taxpayers pay all expenses with no work required.
AT WORK: you get to pay all the expenses to go to work and
then they deduct taxes from your salary to pay for prisoners.
IN PRISON: you spend most of your life inside bars wanting to
get out.
AT WORK: you spend most of your time wanting to get out and go
inside bars.
IN PRISON: you must deal with sadistic wardens.
AT WORK: they are called managers.
Wealth buys leisure
Wealth buys leisure, but not wisdom.
Glossary of Terms
Amortization. The process by which loan payments are applied to the principal, or amount borrowed, as well as the interest on a loan according to a set schedule.
Annual Percentage Rate (APR). The finance charge or total amount it costs per year to use credit, calculated as a percentage of the amount borrowed (percentage rate), including interest, transaction fees, and service charges.
Annual Percentage Yield (APY). The actual interest rate an account pays per year with compounding included; calculated the same way by all banks/credit unions.
Appreciation. A rise in value or price.
Assets. What a person owns, such as cash, stocks, bonds, real estate, and personal possessions.
Back-end load. A sales charge paid when investments are sold.
Bait and switch. An illegal sales technique in which sellers advertise a product with the intention of persuading customers to buy a more expensive product.
Bankruptcy. Legal process for selling most of the debtor’s property to help satisfy debts that can’t be repaid, in exchange for (a) relieving debtors of the responsibility of paying their financial obligations or (b) protecting them while a plan is created and they try to repay debts.
Budget. A plan for managing money, dividing up expected income and expenses among spending and saving options based on personal goals during a given time period.
Capacity. Ability to repay a loan from present income; one of three factors in credit scoring.
Capital. The value of personal items that one owns, including savings, investments, and property, one of three factors used in credit scoring.
Career. Pattern of activities and positions involved in an individual’s lifetime of work to which the person has made a long-term commitment.
Cash flow. A measure of the money a person receives and spends.
Character. Refers to trustworthiness; one of three factors in credit scoring (e.g., paying bills on time shows financial responsibility). Creditworthiness indicating a responsible attitude toward living up to agreements.
Check. Written order directing a bank or credit union to pay a person or business a specific sum of money.
Compounding, or compound interest, Rule of 72. Earning interest on interest. Rule of 72—how long it takes money to double in value. Divide 72 by the interest rate to determine the number of years it will take money to double.
Consumer. Buyers or users of goods and services for personal use.
Consumer advocates. Individuals or groups that actively promote consumer interest in areas such as health and safety, education, redress, truthful advertising, fairness in the marketplace, and environmental protection.Wisconsin’s Model AcAdeMic stAndArds
Consumer economics. The study of the role of the consumer in an economic system.
Consumer movement. Efforts to protect and inform the consumer by requiring such practices as honest advertising, product warranties, and improved safety standards.
Contextual factors. Personal, historical, and socio-cultural aspects of a financial situation that influence an individual or family’s attitudes and behavior, including goal setting, decision making, and judgment about what to believe or how to act.
Historical aspects of context: Each individual and family brings a unique personal history to the financial situation, and each interacts with the workplace, school, and neighborhood environments with personal norms, expectations, and social structures that have evolved over time.
Personal aspects of context: The perceptions, values, and goals of all parties involved in the financial situation.
Socio-cultural aspects of context: The larger social institutions (such as the media, business and industry, economy) and cultural values, folkways, mores, and language that influence financial decision making.
Contract. Legally enforceable written or oral agreement between two or more parties to do or not do something.
Cost/benefit analysis, risk/reward relationship. Tool used to choose among alternatives involves weighing the cost of a product or service against the benefit it will provide.
Credit. Amount of money a creditor is willing to loan another to purchase goods and services, based on trust and the expectation that the money will be repaid as promised with interest.
Credit card. Card that enables holder to charge expenses for purchases or to get money, often with interest; synonymous with "buy now, pay later."
Creditworthiness. A measure of one’s ability and willingness to repay a loan.
Credit rating/score. A measure of creditworthiness based on an analysis of the consumer’s financial history, often computed as a numerical score, using the FICO or other scoring systems to analyze the consumer’s credit. A creditor’s evaluation of a person’s willingness and ability to pay debts as judged by character, capacity, and capital; a mathematical model used by lenders to predict the likelihood that bills will be paid as promised.
Debit card. Card used to pay for goods and services directly from a checking account by transferring funds electronically from one’s checking account to the store’s account to pay for a purchase; also called check cards.
Debt. Entire amount of money owed to lenders.
Decision making. The process of considering alternatives and analyzing information to make a choice.
Demand. The quantities of a particular good or service that consumers are willing and able to buy at different possible prices at a particular time.
Depreciation. Decline in a product’s value that starts the moment a product is purchased (car).
Diversification. Distributing funds among different types of investments to minimize overall risk.
Economy—global or world. Worldwide system that results from choices of consumers, workers, business owners, manufacturers, and government officials in multiple societies and with increasing trade and cultural exchange.
Employee benefits. Additional benefits, beyond a paycheck, offered by employers (e.g., health insurance or pension plan).
Entrepreneur. A person who owns and operates her or his own business. A person who creates a business from scratch, based on a need or personal expertise, and puts creativity and ingenuity into action to provide a
• • • Wisconsin’s Model AcAdeMic stAndArds
service or product. A person who organizes, manages, and takes the risks involved in creating a new product/service or developing a better way to operate a business.
Entrepreneurship. A process that involves (a) seeing an opportunity to provide a product/service, (b) taking initiative to find out about competitors and what customers want from the product/service, and (c) developing plans to market the business, analyze potential profit or losses, and produce the product/service. Imagination, innovative thinking, and management skills needed to start and operate a business.
Ethical/ethical reasoning. Applying criteria, standards, or principles for judging what to believe or how to act. For example, some widely held criteria include: it is good to pay bills, keep promises, and be healthy; it is wrong to cheat, lie, deceive, or otherwise harm others. These principles work both ways in the trust relationship between consumer and business/producer. They reflect personal or business values involving actions and attitudes that affect more than one person or affect one’s character. Choice involves the consideration of regulations of conduct such as rights and obligations, and principles such as respect for others, justice, and reciprocity. In financial terms, ethical questions focus on fulfilling obligations, furthering the well-being of others, or resolving dilemmas and conflicts in a particular financial situation.
Financial plan, financial planning. Personal financial planning is the process of (a) setting goals, (b) developing a plan to achieve them, and (c) putting the plan into action. Ongoing thinking process to develop an orderly program or blueprint for handling all aspects of one’s money, including spending, credit, saving, and investing.
Fraud. Intentional misrepresentation of information with the intent to deceive or mislead.
Front-end load. A sales charge paid when investments are purchased and sometimes when dividends are reinvested.
Goal. Statement about what a person wants to be, do, or have, accomplished by taking certain steps; provides direction to a plan of action.
Goal setting. The process used to determine what an individual wants to be, do, or have, i.e., what a person wants to accomplish.
Green products. Products considered environmentally safe according to objective, authoritative testing.
High-balling. An excessively high offer for a trade-in vehicle.
Implied warranty. Unwritten guarantee that a product is of sufficient quality to fulfill the purpose for which it was designed.
Impulse purchase. A purchase made on a whim, without using a decision-making process.
Income. Any money an individual receives.
Information processing. Analyzing and organizing information for decision making.
Insurance. Risk management tool that limits financial loss due to illness, injury, or damage in exchange for a premium; usually provides protection against large-scale financial loss.
Insurance premium. The payment a person makes to an insurance company in exchange for its promise of protection and help.
Interest. Payment for the use of someone else’s money; usually expressed as an annual rate in terms of a percent of the principal (the amount owed).
Investment. Setting aside money for future income, benefit, or profit to meet long-term goals; using savings to earn a financial return.
Liabilities. Amount a person owes, such as unpaid bills, credit card charges, personal loans, and taxes.
Lifestyle. The way people choose to live their lives, based on values they have chosen.
Liquidity. The ease with which an asset can be converted to cash without serious loss.Wisconsin’s Model AcAdeMic stAndArds
Loan sharks. Unlicensed lenders who charge illegally high interest rates.
Loss leader. Sales tactic where an item is priced at below cost to attract buyers who will then purchase other merchandise.
Low-balling—repairs, new-car deals. Advertising a service, then adding other services or repairs that are not necessary or not expected. An unrealistically low price offered by a dealer for a buyer’s old car as part of a new-car deal.
Money. Anything that is generally accepted as payment for goods and services; a medium of exchange; legal tender.
Mortgage. Loan to buy real estate, such as land or a home.
Needs. Essentials or basics necessary for maintaining physical life, including food, clothing, water, and shelter, sometimes called material well-being.
Net worth. The difference between a person’s assets and liabilities.
Opportunity cost. Whenever choices are made, the cost of something expressed in terms of what had to be given up to obtain it. The resources used to satisfy one goal that cannot be used for another, i.e., weighing of one alternative against another rather than merely considering the cash price or value of a specific good or service.
Payroll deductions. Amounts subtracted from gross income that are withheld by an employer for items such as taxes and employee benefits.
Pay Yourself First (PYE). Disciplined saving or setting aside money as a regular part of the budget for later spending or investing.
Philanthropy. A personal or corporate interest in helping others, especially through gifts to charities or endowments to institutions.
Points—mortgage. A one-time service charge by mortgage lenders at closing to increase the return on the loan; each point is one percent of the amount of the principal.
Predatory lending. Lending practices which promise loans that are "too good to be true" and pressure borrowers to take loans on the spot. Lending practices include a variety of financial abuses such as excessive fees, penalties for early pay-off of the loan, balloon payments, loan flipping, high interest rates, monthly payments the borrower can’t afford, and unauthorized refinancing of loans. Examples of the practice include predatory mortgages, payday loans, overdraft loans, excessive credit card debt, and instant tax refund loans.
Profit. The difference between the cost required to create a product or supply a service and the money received from selling it.
Puffery. Relatively innocent exaggerations used to sell products.
Purchasing power. The value of money measured in the amount of goods and services that can be bought with it.
Reasoning. The process of making and supporting a judgment; giving reasons to defend the conclusion.
Resources. Human resources are those resources people have within themselves, such as working knowledge, skill, mental effort, motivation, energy. Non-human or external resources include money, time, and equipment.
Rate of return. How fast money in savings account or investment grows.
Reverse mortgage. An arrangement in which a homeowner borrows against the equity in his/her home and receives regular monthly tax-free payments from the lender. Also called reverse-annuity mortgage or home equity conversion mortgage.
Risk—investment, personal, insurance. The probability of making a profit or losing money on one’s investment; the chance an investment will decrease in value; possible losses involving income or standard of living. The possibility of a loss from perils to people or property covered by insurance.Wisconsin’s Model AcAdeMic stAndArds
Risk management. Deliberately and systematically using various strategies for controlling against potential personal or financial loss from pure risks.
Risk tolerance. The amount of uncertainty or possibility of loss the individual can bear.
Savings. Money set aside for short-term goals.
Scam, rip-off. Swindle or fraud, especially to cheat or swindle by a con artist in a confidence game, e.g., home repairs, cell phones, gasoline and oil stocks, Internet, telemarketing, credit card, securities, pyramid schemes. See fraud.
Scarcity. An economic condition created by an excess of human wants over the resources necessary to satisfy them; an inability to satisfy all of everyone’s wants.
Shared risk—insurance principle. Using premiums from many policy-holders to reimburse the losses of a few, so that no one suffers a financially devastating loss.
Social security. The federal government’s basic program for providing income when earnings are reduced or stopped because of retirement, or disability. Income is also provided to families when the working parent(s) dies and underage children are a part of the family.
Supply. The quantities of an item that producers are willing and able to make available for sale at various prices over a given time period.
Taxes. A compulsory payment by individuals/organizations to the government; fees placed on income, property, or goods to support government programs.
Time value of money. The relationship between time, money, and rate of return (interest), and their effect on earnings growth. The more time, money, and rate of interest, the more money yielded at the end of a period of time.
Values—personal and cultural. Criteria, standards, or principles that individuals use when making a selection among alternatives in decision making. Prevailing beliefs and value systems of a given society passed on through social conditioning/enculturation.
Value judgment. The process of reasoning to conclusion using facts and values for purposes of determining worth, quality, importance, fairness, and credibility.
Value system. A set of criteria, standards, or principles that guide an individual or group’s behavior and provides a sense of direction to life.
Vision—financial. Description of (a) how an individual defines future financial success and (b) what he/she wants to accomplish; provides direction for decision and actions that invent the preferred future: What will the future look like if financial strategies are successfully implemented and one’s full potential is achieved.
Volunteer service. Working to help others or one’s community without being paid.
Wants. Items that a person would like to have but are not essential for life. Items, activities, or services that may increase the quality of life, but one can live without them.
Warranty. A company’s promise that its product or service will meet specific standards over a given period of time, or the company will repair or replace it, redo the work, or give a refund.
Wealth-building. Increasing the total value of what one owns; one’s tangible assets using strategies to increase savings and personal asset accumulation, thereby promoting individual/family economic well-being and financial security.
Withholding. Employer deductions from employees’ earnings to pay employees’ taxes.
Work, job. Employment, occupation, effort exerted to make or do something. On a relative basis, short-term work or tasks completed for pay.
Glossary of terms from Wisconsin’s Model Academic Standards for Personal Financial Literacy © 2006 by Wisconsin Department of Public Instruction