Obtaining God's Peace & Blessings in Finances - P3

Touched on two of these right here in the beginning.

I've got them written out there for you.

I think management-wise, when I'm looking at people for management, and if you're wanting to be in management, there's three things you need to be able to do.

You need to know how to manage cash flow.

In other words, if you're running a business, if you're running a family, you've got to manage the cash flow that's coming through there.

You've got to be able to manage people.

If you're in a family, you've got to manage the people in your family.

Manage may not be the best word, but you've got to create harmony.

You've got to create motivation, you've got to do the things within a family or within a business.

Managing your people.

And then the third thing is managing your time or managing the time of those that you're working with.

I find if I can find people in management who know how to handle budgets and handle cash flow, who know how to manage people, motivate people, work with people, and know how to manage their time and other people's time, you've got some of the basic elements for success in management.

So that's kind of a little extra deal.

Let's see.

My desire is to learn a lot about a little.

I read a lot, and that's how it I accomplish it.

I I took a Evelyn Wood reading course when I was a senior in high school, and I never really realized how important that was going to be.

But it uh improved my reading skills and allows me to read about five magazines a week, cover-to-cover, business week, different magazines like that.

And uh to when I need to study and when I need to read books, I'm able to read a lot of books.

I've got a sec here of books I'm gonna show y'all later tonight.

I've read nine books in the last three weeks.

Uh reading skills are very important, and I think that's overlooked some by our schools.

It's overlooked by us as adults.

We just we make excuses and say, I'm not a good reader.

Well, you can become a good reader.

I, you know, I wasn't very good at at uh a lot of things until I worked at it.

And there's classes and there's skills and there's things that you might want to do if you really want to be a success, because you can gain a lot of knowledge nowadays by being able to just search it out and read it.

It's it's free in a lot of cases, but you need to be able to read it.

Another thing that's important for success is a great attitude.

Uh I I find a lot of people with skill are overdone by people with great attitudes.

So that's an important uh quality for success.

Another one is super communication skills.

Uh to get along in life nowadays, communication is important.

And your family, communication skills are important.

A lot of times a person who is is brought up in a family where you don't talk about things marries a person who always everybody talks about things.

And they go through years and years of trying to understand why they don't communicate is because they've been brought up with different skills and they've never learned how to communicate.

This happens in a family, it happens in a business, it happens in a lot of situations.

Uh there's people who can't communicate in front of groups.

Uh there's people who can't communicate in a small group.

You know, people just sit quiet all the time.

And I mean, I do believe in listening skills.

Those are very important.

That's why God gave us two ears and one mouth.

But you also have to have good communication skills.

It's an important thing.

And if you need to take a Dale Carnegie course, if you need to take some speaking courses, if you need to do whatever, I think it's an important quality for success.

So don't underrate the importance of communication skills.

Again, I hear a lot of people say, Well, I just can't do that.

I'm just not a good communicator, I'm not this, or I'm just a quiet type, or I'm just this, or I'm just that.

Well, we're we're all born a little bit more naturally with one thing than another.

But if we didn't in our life do anything except what comes natural, we wouldn't do anything but eat.

That's about the only thing when you come out and you're born that that happens naturally.

You say, Wow, I'm hungry.

And after that, everything else is kind of learned.

So some things we work harder at than others, but you know, we we need to work through our life developing some of these important skills.

Good education, uh, don't have to really expand on that.

I think that uh good education, the only thing I want to say about that, I'm not talking about going to school.

I am still getting educated.

I've been uh in my business for this will be my 30th year that I've been uh in business.

And uh I study, I study tapes, I listen to other business people, I read magazines, I'm learning and educating myself all the time.

Don't think when I say good education, I mean that you do good in school.

There's a lot of people who did lousy in school, there's a lot of people who made bad grades, there's a lot of people who didn't go to college, but they're well educated because at some point in their life they said, you know what, I'm gonna get an education, and I'm gonna get it from reading, I'm gonna get it from studying, I'm gonna get it from applying myself in some other areas.

So education and ongoing education all your life is an important quality for success.

And then a productive work experience.

You know, no matter what you're doing, you can have a productive work experience.

There's a uh story that I really like in uh one of these books that I'm gonna talk about a little bit later on.

Uh this this was a uh um New York Times bestseller.

It's called uh Rich Dad, Poor Dad.

And uh I really like some of the stuff in here.

There's there's some of the stuff I don't agree with, but an example, just a quick short one that applies to what I'm talking about in here.

This this guy had a dad uh who was a uh well-educated, I think he had a doctorate's degree, he was a professor, and he taught him one system of economics, and he had a best friend who had a dad who, and they both lived in the poor part of town.

They were both uh thought they were poor, and uh, but they went to school because of the way the lines were drawn with all of the rich kids in town, they they thought.

And one dad, his dad taught him one set of values, and the other dad, uh who kind of took him under his wing, uh, taught him a whole other set of values, and he would hear one thing here and one thing there.

And one dad would just tell him, and the other dad would let him experience things.

And an example that is given in this book about where he really learned things was dad number two, his friend's dad, he he said, uh he he went to he said, I want you to teach me how to be rich.

And so uh his his his dad says, uh Mike, his friend's dad says, Okay, you guys go to work for me up here at the uh convenience store, and I want you to dust cans.

And he said, Okay.

And he said, What are you gonna pay me?

And he said, ten cents an hour.

And even back when this guy was working ten cents an hour wasn't anything.

And he said, You that's gonna teach me how to be rich?

And he said, Yeah, I'll teach you how to be rich.

And so he worked there three weeks, and the the Mike's dad never came around.

Never taught him anything, never told him anything, never did anything.

So he said, I'm gonna quit.

This is ridiculous.

They're just taking advantage of me.

And all his dad his dad and other people said they're just out to take advantage of you, you know.

So he uh told his friend, he said, I'm quitting, this is ridiculous.

You know, all I got enough money to do is buy a comic book and a and a coke, and and that's about it.

This is a lousy job.

I'm having to skip my baseball games on Saturday to do this and on and on and on.

And uh so he he said, Well, my dad said you'd say that, and when you said that, he said for me to for us to go talk to him.

So his dad went to talk to him and he said, he said, You hadn't taught me anything, blah, blah, blah.

And he said, Okay, well then you want to learn?

You promise you want to learn.

He said, Yeah.

He said, Okay, here's the deal.

You're not gonna work for nothing.

And the kid said, What?

You're not gonna work for nothing.

And he said, Yeah, you want to learn.

You're gonna now work for nothing.

The guy said, Well, maybe I'm really gonna learn something now.

Maybe he was just waiting to see if I work for nothing to teach me.

You know, so he says, Okay, we'll work for nothing.

So he works for nothing.

A couple more weeks go by and nobody said anything to him.

The father hadn't taught him anything.

And he's like, Man, this is even worse than it was before.

I don't even have any money to buy a comic book or a drink or anything else.

So uh, you know, he says, Let's talk to your dad again.

So he goes in to talk to his dad.

I'm trying to kind of shorten some of this for the time being.

But his dad said, Well, you know, right there in front of you is a lot of learning that you can do.

I want you to look around, use your eyes, and think about how you can make money.

I want you to use this experience I'm giving you as an opportunity to make money.

So he went back and he thought about it, and uh they were they were looking around, and as they were leaving one day, they noticed that what happened when they had the comic book section is the uh comic books got out of date, and they took and and the lady cut off this deal on the front that was running the store and would put them all in a deal, and then the distributor would come in and would um pick up those and give her a credit for them and give her replacements that were new and tell her to toss the old comic books.

And uh so they thought, hmm, there's some comic books.

Well, how can we maybe we can sell those things and make some money?

That's a good idea.

And uh so they said, Well, you have to talk to the distributor, I'm supposed to throw them away.

So the distributor came and said, uh, no, you can't you can't sell those things.

In fact, that's one of the requirements we're supposed to uh do away with them.

He said, but but I can do this, I will give them to you if you promise not to sell them, and as long as you work here, you have to be an employee of this store to be able to have a right to have them, and you have to promise not to sell them.

They said, Okay.

So they took the books, the comic books, and they took them to their basement.

They hired their sister to run a reading room after school each day for a couple hours and on the weekends, and uh kids would come in and read all the comic books they wanted for ten cents an hour.

Okay, so it's a good deal for kids to have comic books, and uh they were making about ten dollars a week, paying their sister a dollar or two a week, and uh they had a business, and the only requirement that they had was to stay working at this place for nothing uh so that they could get the comic books every week.

Okay, and they they made a lot of money doing that.

That's just an example of a story, but but it's an example that that hit me real strong because right wherever you're working, there are opportunities.

Wherever you are, there are things you're overlooking and things you're missing.

And if if you sit there and gripe about the money you're making, gripe about not being paid enough, gripe about the opportunity, you many times are missing something that God has put right there in front of you that is a provision for income.

So it's a long way of saying that your work experience can be productive regardless of what you're doing.

Look for a way to turn that into something from what you're doing.

Okay, what is the easiest way to get rich?

I've had some people been asking me that.

Um, you know, they they said uh, hey, just just just cut to the the important stuff.

What's the easiest way to get rich?

And there's a real easy answer to that question, just inherit a lot of money.

All you gotta do is just inherit a lot of money, and that's the easiest way to get rich.

I'm not gonna lie to you.

But since most of us, that's not the situation, we need to have a plan B, right?

We need to have a plan B that will work for the rest of us.

That the uh everybody's looking for kind of like a secret success formula, you know, that will guarantee that you're gonna have more than enough money when you get into retirement.

And there the secret success formula is two words, really.

Spend less.

That's all is to it.

Spend less.

Spend less than you make and invest the difference.

Spend less than you make and invest the difference.

There's uh a good book in here uh in the reading list, a guy's whole deal is how to teach you to learn live on 70% of your income.

Spend less and invest the difference.

I'll give you an example of what happens uh and and how I say that money isn't the problem.

We all think money's the problem.

Money's not the problem.

And I'll give you an example, they've done a lot of studies.

In one study they did, they took and uh took a hundred people that had been inherited or given ten thousand dollars.

And then they went back and checked with them a year later.

Out of that, eighty of the people, eighty of the hundred, guess what happened?

Not only did they spend the entire ten thousand dollars, most of them went in debt and had additional liability.

I mean, they use it to put a down payment on a car, on a big new car, and uh justify the fact that they had this ten thousand to go buy a forty thousand dollar car when they might have bought a twenty thousand dollar car before, and now they had a huge payment to make.

So they a year later not only didn't have their 10, not only didn't invest it, they had more bills than what they would have had if they hadn't even had the$10,000.

So many times money can be a curse and not a blessing.

It can put you in worse shape than it is, and that's sometimes why God, you say, why doesn't God bless me with more?

Because He doesn't want to put a curse on you.

He knows that it would just be a reason for you maybe to go in debt.

So he's waiting on you to learn the lessons that you need to learn.

Eighty people out of a hundred will spend it and increase their debt to buy something on credit.

Sixteen people, sixteen percent of the people would probably be very cautious with the money, would put it in some type of a uh account that would earn between five and eight percent interest.

That's good.

I mean, they're they're at least building something for the future.

They're saying, hey, something's going on with this money, and I can count on it with the compounding that's going to go on.

Four people, four people one year later, would have increased the money by 300 to 1,000 percent by being able to start a business, make an investment, do something with it that was really productive.

Uh I mean our goal is to get into the 16 percent.

It would be nice if we could get into the four percent, but don't find yourself in the uh eighty percent and wonder why God's not blessing you financially.

Now, what's the difference between these people, between the eighty, the sixteen, and the four?

Most people, when given money, just spend more.

They just spend more.

Smart people invest more.

If you give somebody ten thousand dollars, most people spend it.

Smart people invest it and know the value.

We talked about how ninety-six thousand can grow to a million, and that's just with ten percent interest.

If you have an investment that's a pretty good investment, it can grow a lot faster than that.

People who are going to be rich develop biblical financial habits.

The Bible has, we've studied these the last two weeks, have studied biblical financial habits.

People who are going to be poor develop worldly financial habits.

Worldly financial habits say, buy it, buy it on credit, buy it now, you deserve it.

Go out and spend everything you got and then some.

Biblical financial habits say always put back some, always have a storehouse, build a strong foundation, don't go in debt, don't owe people.

The biblical foundations are the foundations that work, whether you're a godly person or not.

You look at look around the world and just see.

Poor people work for money.

Smart people or rich people that have money work for them.

Think about it.

Are you working for money or is money working for you?

Which way is it?

Most of us are working for money.

Poor people pay interest.

Smart people are rich people earn interest.

So who are you imitating?

Are you imitating the world's philosophy?

Are you imitating God's philosophy?

Are you imitating the philosophy of smart rich people, or are you imitating the philosophy of poor people who find themselves never quite having enough?

You know, you ask yourself, are you rich or poor?

Well, first, I want to say that, as you well know, money doesn't make you rich.

And I want to remind you about what true wealth is.

We talked about that the last two weeks.

A person's wealth cannot be measured by how much money they have.

You just can't do that.

It's measured really by how many things you have that you would not take money for.

Think about that.

Your wealth is not measured by how much money you have or how many things you have that you could buy with money.

True wealth to me is measured by how many things you have that you wouldn't sell for any amount of money.

You know, I wouldn't sell my relationship with God for any amount of money.

I wouldn't sell my relationship with my family.

I wouldn't sell, there's some pictures I've got uh that I wouldn't sell for any amount of money.

There's uh stuff that my grandmother gave me that uh I just wouldn't sell for any amount of money.

It wouldn't matter how much it was.

There's there's special things in your life, special memories that you wouldn't take anything from.

A truly wealthy person is a person who has a lot of things in their life that no amount of money would they take for it.

Not a person who just stacked up a bunch of money.

But most of you are here to learn about financial richness and financial uh poorness.

So one of the ways I want to do this is to talk about the way that we value a company.

We value a company with a process called assets and liabilities.

It's a balance sheet, and we have assets over here, and we have liabilities over here.

Any company has that.

And what happens?

You take your assets, which are things of value, let's say you have assets and they total to$100,000, and you take your liabilities, and let's say they're zero, that means your worth for the company is$100,000, because you have no liabilities, have$100,000 in assets.

The way most of our financial situation looks is we have$100,000 in assets, we have$100,000 in liabilities,$120,000 in liabilities, and we have very little assets down at the bottom, very little net worth, excuse me, down at the bottom.

So let's talk about that word asset and liability.

Some of y'all may not even know what an asset and a liability is, so I want to give you a real simple definition of what an asset is.

An asset puts money in your pocket.

An asset is something that's going to put money into your pocket.

A liability is something that's going to take money out of your pocket.

Okay?

If you own a stock that's paying a dividend, that's just sitting there, they're sending you a check, putting money in your pocket.

That's an asset.

If you own a uh boat, I've had some of those, it's a liability.

It's just taking money out of your pocket, you're buying batteries, you're paying for the stall to keep the thing in, you're having to get the motor tuned up, the rope is breaking, it's just a liability.

A lot of y'all consider that an asset, but it isn't.

It's a liability.

It's just taking money out of your pocket.

So look at your assets, look at your liabilities, and determine how do we get more of these things in the future.

When we spend money, how do we figure out how to spend it more on assets and less on liabilities if we want to increase our net worth?

Rich people buy assets, poor people buy liabilities.

Rich own many assets, poor people own many liabilities.

You say, uh, well, what about a bigger home?

Is that an asset or a liability?

If uh if you both have if if if two people have homes and one's a hundred thousand dollar home and one's a million-dollar home, and they both have twenty thousand dollars equity in it, which one which one has more liability?

The million-dollar home has a lot more property taxes, a lot more utility bills, a lot more yard maintenance, a lot more everything.

You know, sometimes the guy that's got the big home has just got a big liability around his neck.

I see this all day long.

I see people who put on the show like they've got a lot of stuff, but all they got is a lot of liability.

Don't admire people with a lot of liabilities.

You need to hold up as a role model people who have a lot of assets.

Remember, it's not how much you make, it's how much you keep that makes you wealthy.

I can I can give you a quick example here.

Um I may have told you a piece of this story before, but most of uh uh my life when I did have a mortgage on a house, uh I I think all my life, but I hate to make that statement, but all my life when I had a mortgage on a house.

It was never more than one year's income.

And I took the extra amount of money and always invested it.

Invested in a business, invested it in something that was going to earn money.

And the difference in spending 20 years in living in a more conservative home and investing money every month is huge.

Other than saying, what's the most home we can buy?

You know, there's some financial people that say, hey, go for all the home you can get.

I really think that's bad advice.

Unless you've got still the ability to put the invest the money and put it aside over there.

Think about it, a$400 golf club or$400 in clothes are now worth next to nothing.

But$400 in Microsoft stock back some years ago would be worth over a million dollars now.

Would you rather have the stock certificate or rather have the golf club or those old clothes that you gave away and outgrew a long time ago?

Most people spend, rich people invest.

It's just a principle that's there.

You know, I I've also wondered what causes us to spend money we don't have.

I think it's the same thing that causes us to take drugs.

It's kind of a weird thought, but it's the same thing that causes us to take drugs.

There's kind of we need something in there.

And, you know, in in people who take drugs, it's like this is gonna make me feel good for the moment, or this is gonna dull out the pain in my life, or this is gonna, you know, make it better.

And the reality is it doesn't last very long.

It may not even make you feel better, and it's gonna make you real sick in the long term.

Well, money is the same way.

A lot of people go out and they feel bad, they feel unhappy, they feel enjoyful, they feel down, they don't feel good about themselves, so they go spend some money, and it temporarily maybe gives them some joy, but long term, just like drugs, it pulls you down, it digs a deeper hole, it causes additional problems, and it will ultimately lead to your ruin.

It'll cause bigger and bigger and bigger problems.

So the same unhappiness, the same lack of joy that causes people to do unhealthy things causes us to make unhealthy financial decisions.

If we've got an issue in our life, we need to deal with that.

We need to come to God, we need to come to godly counsel and deal with what's going on in our life where we don't have to try to treat it with things that are really gonna be unhealthy for us.

We've got to turn to God for our joy, we've got to turn to God for our answers, we've got to turn to Him for everything.

Let me uh I've been been threatening to do this with you guys.

Uh I'm gonna give you a uh the SAT test that we've been talking about.

Um just just think about yourself on some of these things and see how you score.

If uh I think there's there's uh 11 questions here.

We'll we'll uh let you see what your score is when we get through.

I'm not gonna call on anybody, but you may want to just ask yourself.

And really, the way we're gonna do this is just it's either that's me or that's not me.

Okay?

Just ask yourself if that's you or it's not you.

Yes or no?

You can see yourself doing that.

Um I I told you this one last week.

I'm the kind of person who sneaks food into the movie theater.

Is that you or is that not you?

I told you last week my wife does that.

I do too, but my purse always looks funny.

Um I'll split an entree with somebody I just met to avoid having to pay for an entire meal.

Just met somebody sit down, and they said, Hey, do you want to split an entree?

And you think, yeah, that'll save me some money.

Would you do that?

Or would you kind of go, no, no, not me.

No, no.

I know the exact price of everything I'm wearing right now.

Is that you or not?

Are you that cost conscious on what you spend and where you get it and how much it was?

And did you think about it enough?

I know the exact price of everything I I've got on right now.

Number four, I try to compare prices on the internet before I make any kind of a major purchase.

I guarantee I do that on everything.

I'm amazed at the money that I can save doing that.

I had to buy two printers a few weeks back, and I priced them at uh Comp USA and several of the local places, and uh they had some good prices, what appeared to be good prices, they were discounts and what have you.

I did some shopping with shopping robots on the uh uh internet, and I bought two printers for the price that I could get one for here locally.

Uh and it was shipped to me, it was at my door within a couple of days, didn't have to get out and pipe the traffic or anything.

So are you the type that shops the internet before you make any major purchase?

I refuse to dry clean if I can wash it myself.

Is that you or not?

I never buy lottery tickets because I believe the odds are greater than the fact that I would suddenly turn to solid gold.

Is that you or not?

I rarely buy anything at a 7-Eleven or convenience store that I could get cheaper at the supermarket.

Is that you or not?

I try to cook for myself at least four nights a week, or I try to cook for my family at least four nights a week.

My wife cooks for our family four nights a week, we cook for ourselves four nights a week, however you want to say it.

Or if you're single, I cook for myself four nights a week because it's cheaper and it's healthier.

Is that you or not?

I get a bonus at work and I immediately pay off my debts or invest it in an interest bearing account.

Is that you or is that not you?

I shop sometimes at secondhand stores.

Is that you?

I use coupons at the grocery store and check the papers before making any purchases.

Okay, eleven questions there.

If you got seven or more of those, as yes, that's me, uh congratulations.

That's a great job.

You're you're doing a lot of things you need to be doing to really uh watch your money.

If you're somewhere between uh three and uh seven, three and six, I guess, then uh join the club.

You're like most of the rest of the people in the room.

And if you're less than that, uh you're gonna really be interested in the reading list when we get to the end of this uh session tonight.

Okay.

Um, you know what's happened is the world has really changed, but our education system hasn't.

We're still turning out students that can't balance checkbooks, don't understand the cost of credit cards, we haven't teached them how to really run the rules of money.

And so unfortunately, since since they're we're not taught in school, we have to teach it at home.

And if we don't, we learn hard lessons.

Life teaches us hard lessons.

By the time we learn those lessons, it's too late to even teach our kids.

Uh they're often gone and beginning to make some of the same mistakes again.

So learn as soon as you can the rules of money.

I I was I told you about how much I'm against credit cards, and I heard this week on the radio something that just really infuriated me.

I heard about uh that they've uncovered that OU has uh made a deal with a credit card company to uh let this credit card company have an office there on campus and solicit the students and give them the names and and help them as far as soliciting the students for credit cards.

And uh it was uncovered that they've got a 10-year deal and that the credit card company is paying OU$13 million plus like three-quarters of a percent interest on every charge that the students make from now on.

And that's how big a money the credit card companies are making to be able, and that's why they want to get in young.

Why do you think cigarette companies advertise Joe Camill and advertise young?

They want to get them hooked young.

Why do you think credit card companies, just the minute that you're old enough to get a credit card, they're wanting to send you credit cards, they want to get you hooked early.

They make a lot of money on this stuff.

Sometimes the greatest investment loss is a loss of a missed opportunity you have because you didn't have cash.

I want to give you a quick example on this from my personal experience, not because it makes me look good, but it's an example of what happens if you do have cash, uh, and you can make some some examples.

I had invested about$100,000 back when I was uh it was about 10 years ago.

And I I had done real well with some of my investments, and that had grown to about$350,000, and I was pretty excited about what I'd done with it, but I really you know was still always on the lookout for something that was a good investment.

And I was driving up down the freeway to Dallas, and I came across this piece of property that was sitting vacant along right there on Airport Freeway, and this was back when uh the uh FDIC was selling off properties that had gone back and been repossessed, and there were some really good deals out there on land and things.

And this property had previously sold for a lot of money, but had been defaulted on it and had gone back, and and uh Jan and I prayed about it and said, This this property is worth a lot more money than I think we can buy this thing for.

Let's let's go ahead and take our investment money and put it in the property.

So we did.

We put uh$350,000 in that property, and uh about a year, a year and a half later, we had an opportunity to sell the property.

We had a buyer on the property, and meanwhile, I was wanting to buy some property to be able to put a uh a new business on, and so I I did what's called a 1031 exchange, which means you don't have to pay tax on your gain on the property.

You take that property and exchange it for another piece of property that you're buying, and even though your property goes up in value, you've gone from 350 to 750,000 in one year, uh, or about a year and a half, and I didn't have to pay any tax on that because I traded it for another piece of property that was worth uh more than$750,000, but I was able to buy it for$750,000.

And two years later, that property is now appraised at a million and a half, and I've got my affinity dealership setting on it.

Okay.

Uh that is uh from a hundred thousand dollar investment that I had that I was willing to make, you know, about ten years ago, and let it go along, and it's grown to a million and a half value.

And so, you know, I just I can't I can't tell you enough about what would have happened if I hadn't had saved that money and had the cash, I could close fast on that property.

It was a cash offer that I made.

I said, I said, I'll have you check in two days on this property.

It was a cheap price, but they there the FTIC was wanting to do deals for cash.

They had other offers on the thing, but they were to go get finance.

I said, cash money right here, right now, and boom, they took my offer.

You need to be able to have the ability to deal in cash if you want to get some good deals on things.

That the only reason I was able to do it because of a a uh cautiousness in my financial investing.

So we we talk, I've talked a little bit about investing, and what what is investing?

Investing is managing risk.

Now, somebody was saying the other day, they said, Well, isn't investing just gambling?

And it can be.

It can be.

There are people who are gambling on the internet every day, playing the stock market, in my opinion.

Because they're really not making good sound decisions on the investments that they're making.

But investing means that you've investigated, that you have managed your risk, you've minimized your risk because of what I call due diligence.

You've checked out the company, you've checked out the prices, you've checked out this, you've checked out that, and you're investing a cautious amount of money.

For instance, one of the things that they tell you to do in investment strategy is to never put over 10% of your money in any one investment, in any one company.

If you had$100,000 you were investing in the market, you'd never put more than$10,000.

Another method is to put$10,000 in 10 stocks.

And that way you've lowered your risk if one of these companies uh gets in trouble.

Uh this is another way to do that is by getting into a mutual fund that owns a variety worth of stocks.

But again, you might get into a variety of mutual funds at the same time.

So one of the things I suggest is no load mutual funds for people who don't know a lot of stuff about it.

I like no load mutual funds and I like real estate.

If you're if you have a knack for real estate, if you understand real estate, and if you can can real estate sometimes is not very liquid, it's not easy to get rid of.

I don't like having debt on real estate.

Uh, but if you if you know enough about it, it is something also to get into, but it's not just for the paint at heart if you're just kind of thinking, oh, let's go jump into real estate.

Uh one of the reasons I like no load mutual funds, and what I mean by no load is I mean there's no commission.

The typical investment that you buy, there is a two to an eight percent commission that is paid.

Like if you buy a mutual fund from a broker, there's typically either an upfront or when you sell it at the end, commission that goes to the broker of somewhere between two and eight percent.

There are investments called no load mutual funds that you actually buy directly from the mutual fund company.

And they say no load, they mean no commission.

And you can buy straight from Vanguard, Fidelity, some other people, their uh investments.

You can uh go on to uh the the uh internet and sign on to Swab or eTrade or Fidelity or any of the ones there, and they have a computer page where you put in, I want low risk, I want this, or I want this, and they will give you a rating according to who's got no load, who's got commissionables, which ones, how they perform in the last years.

You can get more information in three minutes on a computer nowadays as a novice that knows nothing than a stockbroker could give you in a day 10 or 15 years ago.

So the information is available at your fingertips to make some fairly good decisions.

If it's something that you're you're interested in and you're wanting to do, I would suggest looking at uh Susie Orman's book.

Uh she's got a list of 800 numbers and of companies and stuff like that.

Her book is uh look on page 263, and uh you'll see that list.

You'll hear her on a lot of talk shows.

She was on a talk show this week, in fact, at Good Morning America or something.

Uh her book, Nine Steps to Financial Freedom.

She's an investment banker, stockbroker lady, and 263 tells you some stuff about no load funds uh and about different people you can call on that.

So if you're interested, look look at that.

You can I'll leave his books up here, you can look at them afterwards.

Another program that I like, there are several of the banks that have what's called a share builder program.

I know Wills Fargo has one, and what a lot of people do is they take a certain amount of their check and invest it every month.

Like they'll take$200 out of their check, their paycheck, and invest it every month.

And that can get expensive if you're going out and paying stockbroker commissions.

So banks uh like Wells Fargo have a uh division that does investments, and you go into their share builder, and for two dollars, they will buy a same amount of stock every month.

So if you wanted to buy$20 or you wanted to buy$2,000 worth of stock every month or every four months or every six months or whatever period it was, they will automatically do that on the timetable you've told them to do it on, and they'll do it for two dollars a trade.

Uh so there are some programs out there that are pretty reasonable to be able to make monthly investments.

Because I know the first thing you're gonna say is, well, you know, if I start saving$200 a month, what am I gonna do with it?

I don't know where to put it.

Uh put it into it to one of these mutual funds, put it into an index fund.

An index fund is a fund that indexes a certain thing.

For instance, there's one uh that indexes the standard in poor, there's one that indexes the NASDAQ index called QQQ, there's one that indexes the uh Dow Jones average.

Uh you've got different index funds, and you actually buy one stock and you're buying all of those.

Like if you buy QQQ, which is the NASDAQ fund, or you buy DIA, which which is uh the big board, uh you buy a hundred stocks that they own, you're buying an interest in a hundred stocks, or in fifty stocks, or in thirty stocks, just by buying one stock.

So one transaction actually buys you 30 or 50 or 100 different stocks.

It's called an index fund, and you can do that on the$2 deal each month through Share Builder.

So, I mean there's some indexes you can buy that just save you a lot of this trouble.

If you think generally the market's gonna be going up, uh buy into the Dow Jones average or buy into the Standard Import average or buy into the NASDAQ if you like technology, you buy a little bit of it each month and just have it come straight out of your bank account.

And that way you don't have to go through the temptation of, well, I've got to save it, I've got to do this, I've got to do that.

It's just a direct deduction that's automatically done at whatever intervals you you set up.

Another question that people have asked is what is a 401k?

I've I've mentioned a couple times about a 401k.

401k typically, that 401k, by the way, if you hear about these different things, that's that's typically the section of the law that refers to that.

If you go to the actual uh code, there's a book that's about this thick that is the uh code of all our income tax laws and what have you.

And if you go to section 401, item K, it talks about an account that uh corporations can set up and they can employees can put money into, and then the company matches some percentage of that typically, and it has a vesting period of when uh that money that the company has put in becomes yours.

Sometimes it's a couple of years or whatever.

Uh but anyway, the the company is adding to your money, you're getting a deduction.

So let's let's take a for instance, let's say that you make$50,000 and you you can put up to 15% of your income into a 401k.

So let's say that you put 10%, put$5,000 in there.

Instead of being taxed on$50,000, you're taxed on$45,000.

The$5,000 that you put into a$401 each year is not taxable income at this point.

The only time that it will be taxed is when you retire and you pull it out on a slower amount at hopefully a lower rate at retirement.

And all of this that normally would be taxed, you're growing your tax.

Like if you're in a 30% tax bracket, you're getting that 30%.

We saw what money would do.

Hey, 30% is growing for all those years, and then you have to pay your tax instead of having to put in a net amount.

So a 401k investment if your company offers it is a very good way to save money.

And it also is good because normally the companies match a percentage of what you put in.

It's a way, it's one of the few things in America where savers are rewarded.

Savers, the more you put in, I've got employees at my company that max it out at 15% a year.

They get rewarded because I put a percentage of whatever they put in.

You know, here's two people that earn the same amount of money.

One of them every year, I'm giving a bonus of X per 15% to of what they're putting in, and another one I'm giving zero bonus to.

They're determining their own bonus by whether they're a saver or not.

So I love the 401k plan because it rewards savers.

Now, one thing I want to remind you about it if you take your money out early, there's a 10% penalty.

Uh you can borrow money out of it as long as you pay it back, but I don't suggest doing that either.

Um, there's a few other exceptions.

If you need to use it for this, this, this, or this, you can take it out without having a penalty, but there are some penalty provisions in there, so you need to be uh aware of that.

If I was given a choice of borrowing from my 401k or taking a second lien on my house, which one makes the most sense?

Which one would you do?

Okay, second lien, Robert says.

And the reason for that is you can charge off a lien on a home.

There's not a lot of debt that you can charge off.

You can charge off a lien on the home.

If you take out a debt on your 401k, you're having to pay back the interest to yourself, but you're paying interest, and that's not deductible.

If you pay the interest back on a second lien, it is deductible.

Another thing uh is a Roth IRA.

You may have heard about this.

This is something that came out in the last few years.

It's named after the uh senator, I believe it is, who introduced the bill, uh, Senator Roth.

And uh a Roth IRA is an individual IRA.

Uh IRA, by the way, individual retirement account is what that means.

And uh what that's for is people who don't work in a company and who want to set up their own individual retirement account.

And a Roth is is one of the new vehicles that we've got out there, and one of the reasons that that uh people like it, you you do take on a Roth IRA and you pay taxes on the income when you put it in.

But whatever earnings there are on that income, for however long it is in there, you don't pay taxes on until you draw the money out.

And there's no penalty.

The reason some people like the Roth is if they're not sure that they're gonna have to draw the money out and they don't want to take a chance on the penalty issue, they go ahead and pay their taxes, put it in, let it accumulate.

All the earnings in that are tax-free.

Have to pull it out, you can pull it out without a penalty.

Most of the uh penalty provisions kick in uh up to 59 and a half years of age.

So if you pull your money out anytime after 59 and a half, there's there's never any problems or any penalties with just about any of the IRA laws.

Okay, let's look at some do's and don'ts.

Y'all have asked me to kind of just get down to the basics and tell me what I should be doing, what I shouldn't be doing.

So I gave you a list here of things.

Uh let's just kind of run down through them real quickly.

Don't buy lottery tickets.

You got better odds of being hit by lightning.

I I call lottery tickets a tax on stupid people.

If you want to buy a lottery ticket, just think about it.

And I want you to put this in your mind.

I want you to walk up and say, hey, I'm stupid.

Could I buy one of those stupid tickets?

That really is what it is.

The odds of winning are terrible.

I mean, there is just just no chance that you're gonna do it.

I know some somebody wins, but aren't you amazed they sell 15 million tickets and nobody wins this week?

We're gonna carry it on over till next week.

Yeah.

Fifteen million to win.