Getting Rich
We live in turbulent economic times and the headlines are full of alarms. Of course, that's what sells newspapers and attracts attention. After all, the networks won't sell many ads for a broadcast that headlines, "Nice Day, Millions are Safe and Happy!"
At the same time, I've received an astounding number of calls and emails from people facing real panic over home foreclosures, lay-offs, health or education costs. I have no idea why I'm suddenly getting these emails--it's a new thing compared to past years--but they concern me. While I hope the fear is largely based on media hype, for individual families, the anxiety is real.
Obviously, millions around the world (this is not just an American problem) are faced with rising prices, especially for food. We're faced with economic uncertainty and in too many cases, with real emergencies. Some of us are losing our jobs, our homes, even our hope. This is not acceptable!
Fortunately, history shows that over time things tend to get better, but what about the family who needs help today? As individuals and as groups, I think we should be upset about this. We need to get involved.
We need community conversations about globalization, housing costs, health care and job training. Fortunately, most TIPS subscribers live in democracies where we can voice our opinions. We can agree, or disagree. We can share our point of view--especially if we are willing to listen to opposing viewpoints. In this election year, get involved. I'm not suggesting any particular candidate, party or perspective, but I think democracy is a good thing and it works best when people get in the game.
On a personal level, however, I think we also need to be dramatically more aggressive about individual responsibility. I'm going to say some very blunt things, and some of you will disagree. Good for you! But here's my point of view:
1. Debt is bad. Most of us live beyond our means. As individuals and as a nation, we are addicted to spending money we don't have. Consumer and credit card debt is nuts! Pay off debt and set yourself free.
2. Greed is bad. Many (not all!) foreclosures happen because buyers got caught-up with brokers and took "leverage" to ridiculous extremes. People bought homes, cars, vacations, and other things counting on rising incomes and luck to bail them out. Like any form of gambling, over time the casino wins and the players lose. Every time.
3. Ambition is good. I love setting goals and having big dreams. A healthy desire to create, to have more and live better is good and it's best when based on solid plans, hard work, and patience. In building a great life, some boredom and routine are good. Adrenalin is usually a bad sign.
4. Saving is good. The hardest part of getting rich is accumulating the first $20,000 in savings. Week by week, putting money in a savings account is something any child can learn, and it's the first step to wealth. Live below your means, save a little every month. Getting rich fast is exciting, but rare. Getting rich slowly is easy and absolutely reliable.
5. Investing is good. The second step to getting rich (after learning to save) is investing for growth. I'm talking about Warren Buffet's attitude of steady, predictable growth over a lifetime. If you want to speculate with some of your hard-earned savings, I suppose that's alright, but never confuse speculation with investment. They are different games and have different results.
These are turbulent times and the news media may bring bad news for a long time to come. I don't know about that. But I do know each of us is in charge of our own decisions. We have the power to live well and we can encourage others to do the same. We can do our work and build a great life. We can save for the future and make a difference in our community. And along the way we can love well, and maybe have some fun!
Written & Published by Philip E. Humbert, PhD
Visit our website at:
http://www.philiphumbert.com
We live in turbulent economic times and the headlines are full of alarms. Of course, that's what sells newspapers and attracts attention. After all, the networks won't sell many ads for a broadcast that headlines, "Nice Day, Millions are Safe and Happy!"
At the same time, I've received an astounding number of calls and emails from people facing real panic over home foreclosures, lay-offs, health or education costs. I have no idea why I'm suddenly getting these emails--it's a new thing compared to past years--but they concern me. While I hope the fear is largely based on media hype, for individual families, the anxiety is real.
Obviously, millions around the world (this is not just an American problem) are faced with rising prices, especially for food. We're faced with economic uncertainty and in too many cases, with real emergencies. Some of us are losing our jobs, our homes, even our hope. This is not acceptable!
Fortunately, history shows that over time things tend to get better, but what about the family who needs help today? As individuals and as groups, I think we should be upset about this. We need to get involved.
We need community conversations about globalization, housing costs, health care and job training. Fortunately, most TIPS subscribers live in democracies where we can voice our opinions. We can agree, or disagree. We can share our point of view--especially if we are willing to listen to opposing viewpoints. In this election year, get involved. I'm not suggesting any particular candidate, party or perspective, but I think democracy is a good thing and it works best when people get in the game.
On a personal level, however, I think we also need to be dramatically more aggressive about individual responsibility. I'm going to say some very blunt things, and some of you will disagree. Good for you! But here's my point of view:
1. Debt is bad. Most of us live beyond our means. As individuals and as a nation, we are addicted to spending money we don't have. Consumer and credit card debt is nuts! Pay off debt and set yourself free.
2. Greed is bad. Many (not all!) foreclosures happen because buyers got caught-up with brokers and took "leverage" to ridiculous extremes. People bought homes, cars, vacations, and other things counting on rising incomes and luck to bail them out. Like any form of gambling, over time the casino wins and the players lose. Every time.
3. Ambition is good. I love setting goals and having big dreams. A healthy desire to create, to have more and live better is good and it's best when based on solid plans, hard work, and patience. In building a great life, some boredom and routine are good. Adrenalin is usually a bad sign.
4. Saving is good. The hardest part of getting rich is accumulating the first $20,000 in savings. Week by week, putting money in a savings account is something any child can learn, and it's the first step to wealth. Live below your means, save a little every month. Getting rich fast is exciting, but rare. Getting rich slowly is easy and absolutely reliable.
5. Investing is good. The second step to getting rich (after learning to save) is investing for growth. I'm talking about Warren Buffet's attitude of steady, predictable growth over a lifetime. If you want to speculate with some of your hard-earned savings, I suppose that's alright, but never confuse speculation with investment. They are different games and have different results.
These are turbulent times and the news media may bring bad news for a long time to come. I don't know about that. But I do know each of us is in charge of our own decisions. We have the power to live well and we can encourage others to do the same. We can do our work and build a great life. We can save for the future and make a difference in our community. And along the way we can love well, and maybe have some fun!
Written & Published by Philip E. Humbert, PhD
Visit our website at:
http://www.philiphumbert.com
1 comment:
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