40 Tips to Invest From Warren Buffet (Part II)

Thursday, December 26, 2013
Warren Buffet is the richest man of the entire world, let´s follow his counsels on value investing philosophy.

21. Crisis? Yes, but not for everyone.

Some companies do resist to crisis. Just watch them when economy is low because they can be wonderful opportunities to invest.

22. Manage your investments

Make a check-list before taking any decision just like plane pilots do, because the brain will get used to put aside the things which are not convenient. Using a check-list will bring you to reality and to the necessary discipline to take decisions.

23. Be humble

Humility should be part of human behaviour but it is essential to the investor because it will allow you to accept your errors in order to correct them.

24. Be calm to invest

No prevision can determine the time your investment will need to return profit. Do not use capital that you could need.

25. Diversification

"Exaggerated diversification is only justified when investors do not know what they are doing."
But diversification will dilute risk too.

26. Invest on a good brand

Investing on a well known brand means success in the long term.
Well known brand will deploy time and energy to impose themselves and success. Logically your portfolio will have a better long-term valuation.

27. Be objective in all your decisions

Learn to be critical towards your own decisions. Determine the reasons that compel you to buy or sell a stock.

28. A good record

A good record remains a good record even after a fall of 3%. The swings of the stock market in the short term can offer you beautiful buying opportunities at the best price.

29. Watch the leaders

Do not forsake the simple investment. Some values have grown steadily but sometimes they go unnoticed because often
investors do not like the simplicity and are more reassured by investing more complicated cases.

30. Work hard

Investing is about dedicating your time and working hard to attain objectives.

31. Free thinker

Stay free and independent for all your decisions. Being of the same opinion is not a guarantee of success.

32. Capital and growth

Study the companies that do not need regular investment for their development. These companies always have
sufficient reserves to ensure their financial stability.

33. Watch for overvalued stocks

Be aware as well of the market realities. An overvalued value may represent a good opportunity to sell

34. Look for small golden opportunities

Many small values which are neglected by institutional investors and the media are often very beautiful investment opportunities.

35. Accounting, you know?

Understand the business and its value will require a minimum of knowledge. Be sure to read some books so you are familiar with the language of business.

36. Be watching

Take advantage of the swings of the market to be always ready to catch opportunities that present themselves to you. Learn how to be a reactive investor!

37. Invest without precipitation

Investment takes time and careful study for each selected value. Override these rules will transform you in an speculator unable to ensure the sustainability of your investment.

38. Look for the keys of success

A company with a high growth potential has probably innovation, patents and know-how... which will ensure its success.
Try to find the keys of success of the company on which you want to invest

39. Keep a cool head

Your judgment must not be altered by the swings of the market, publications in the media and analyst opinions. Stay objective and be confident in your own judgment.

40. Do not compare

If your neighbor has made 18% profit last year, do not try to imitate him or her, but develop your own investment strategy and your own analyzes.

40 Tips to Invest From Warren Buffett (Part I)

Thursday, December 19, 2013
If you had invested 1000 dollars in Berkshire Hathaway Inc, the financial holding company of Warren Buffet, you will have 5 millions dollars today.

1. Rule number one: do not loose money. Rule number two: do not forget rule number one.

  • Whether it's socks or stocks, I like to buy the goods quality when is marked down. Stocks have ups and downs all the time. When stocks go up then prices are really high, when they go down prices are cheap.
    In real life when you want to buy yourself a good coat you wait for the mark down period, they why should you buy stock options when prices are so high?
    Wait patiently till the market will propose you a good price and to recognize a good price, learn to value a good company.
  • It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price. Don't hurry, be patient and invest in good quality companies when prices are cheaper. You'll take less risks and get better results, just watch to not buy too expensive.
  • We're just trying to be to be fearful when others are greedy and greedy when others are fearful. The ideal situation is to buy stocks that people are selling for reasons that do not concern the fundamentals of the company. To do so, you must learn to value a company and control your emotions.
  • I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.
    Invest into companies which are simple to understand and simple to manage. If the activity of a company is too complex, keep away from it. You won't be able to value it and if you are not able to value it you'll never know if it is a good opportunity or not.
  • Risk comes from not knowing what you're doing. Everybody thinks that risk comes from market volatility, that is what they learn at the commerce school. But it is a stupid thing because the real risk of investing comes from the probability to definitely loose your capital. And this probability becomes bigger when we don't know what we are doing.
    If you want to buy yourself a car you spend weeks to compare prices and look for the best offers. This is common sense.
    But it is strange that when we are dealing with stock options we act by impulse without thinking or reading the WHOLE financial report of a company and we just act because one line impresses us.
  • You just need to learn one single lesson, that it is of vital importance: to know how to value a company. It's the only way to know if you're paying a fair price, otherwise it is not investing but casino playing.

2. Invest in companies you understand

An investment you understand is a sure success. Many people ignore this but it's so important. We can take the example of Warren Buffet which has almost never invested in technology (with the exception of IBM from which he owns 5% in shares).
But in general if you don't understand a company, do not invest.

3. Patience always pays

Look for quality companies but wait for good opportunity prices.  It is very important to not pay too much.

4. Committed managers

A company whose executives are shareholders will always be responsible in the decisions and directions it will take in the future towards its partners and investors.

5. Leaders of impeccable honesty and integrity

The integrity of the company's leaders is a sign of success and confidence in the business world. It's up to you to watch over the managers of the company you've chosen.

6. Buy cheap, sell expensive

This seems logical but it is easy to forget if you jump over an opportunity following an impulse that is often too expensive.

7. Patience

Patience pays and investors know about it. Nevertheless if you act on an impatient mood your decisions will be less objectives.
If you haven't seized an opportunity just be patience as the price will
become attractive sooner or later.
Think that the market is huge and that there are many others opportunities out there.

8. Knowledge

Knowledge is the key to success. So read, study, keep informed yourself and compare things all the time; it's the best way to be completely objective.

9. Passion

Investing with passion will allow you to put the time and energy in your job as investor.

10. Fear, the chance to get good opportunities

Ask yourself why values are overly sold on markets because they are often unfairly sold off, an this is an excellent opportunity for you to acquire them.

11. Price is what you pay. Value is what you get.

Cheap stocks does not necessarily mean a good deal, for you may still be buying them at its highest price. You must observe its value in time to really see if it's the moment to buy.

12 Motivate your decisions

Do not invest without taking the time to note down your motivations, then you can compare your writings with the reality of markets and get conclusions.

13. Risk

Investing your money without controlling the risk is like being in the back seat of a car at whole speed without driver.
If you can't define the rules to handle risk, do not invest.

14. Markets influence

Do not be fooled by the markets and sell your values only if they have achieved what you set out in your trading plan.

15 Undervalued stock, yes, but for how long?

To buy undervalued stocks is a good opportunity, but ask yourself about the reasons for its devaluation.
An event such as a takeover bid or launching a patent could bring investors interest on this value

16 Stocks smoke screen

You may think that you know a value by its image, its marketing, its name, its products... but focus your attention more on its annual reports on its figures, projections ...
This approach will allow you to remain objective and have a length ahead of many investors.

17 Footnotes

You may find important revelations in the annual reports small printing footnotes.

18. Short term investing for long term investments

Enjoy the markets in the short term, the companies offering good prospects in the coming years.
The market often tends to amplify the good or bad short-term news which represents many opportunities for invest in promising values.

19. Macroeconomic forecasts: myth or reality?

Do not attempt to predict macro-economic figures to motivate your investment decisions. Do not expect an economical upturn  because it is often too late.

20. Compare, Analyze

To invest you need to compare and analyze markets, but as an investor you need to compare and analyze your failures as much as your success. Write down a plan.

Change Anything You Want in Your Life in 3 Steps

Wednesday, December 11, 2013
To change a bad habit, overcome a behavior that does not suit you, or to adopt a different attitude you have to go through these 3 steps.

If you skip one you just wont make it. Whether if it is to achieve financial independence, become more efficient, learning to not to procrastinate, develop your leadership or make a significant change, you have to go through these key steps.
If you do not respect, it will be difficult to get to it .

The 3 steps to change anything you want in your life are simple:
  1. Understand the mechanisms that trigger factors, difficulties and performance.
  2. To have the desire to adopt a new behavior .
  3. To be willing to make efforts .

Apply this to the domain of your choice and see that these are essential steps. You'll see that if you skip a step, it will be hard to make it.
For example if you want to stop procrastinating and you  "force " yourself you are going to burn because you do not understand what you are facing and you will misdirect your efforts.

If you want to negotiate your salary and you assume that you had a positive opinion of your job last year, you better go thorough these steps before.
To understand how a salary negotiation work, you'll have to change to get it and accept the efforts you have to do.

Step 1: Understand what is happening.

If I take the example of time management  we realize that what works well is illogical. It is often the opposite of the basic advice that everyone gives you .
They say that to be effective you must make a list of everything you have to do. The problem is to listen to people who know nothing about it. The other problem is that sometimes there are people who makes you believe that they know what they are talking about.
To overcome a problem you must understand the key mechanisms and especially those that apply to your situation .
But you do not you need to become an expert in time management to learn effectiveness, you just have to understand the mechanisms .
Triggers are situations or stimuli that cause the problem. For example, you are overwhelmed each time a new project comes. You lose patience when Tom is involved in a meeting, etc. .
These are signals.

Ask yourself the good questions to understand what's happening.

What are the consequences of my current behavior?
When a new project arrives and you feel overwhelmed you destroy the work in progress and your customers suffer.
When you lose patience you lose credibility in front of your team.
You 're committing self sabotage.
Then you have to understand the process with a more broader view .
What are the cognitive processes, behavior and what goes through your head when the problem is occurring? The goal is to "understand".

Step 2: Have the desire to change.

Change anything you want in your life
Image courtesy of [Stuart Miles] / FreeDigitalPhotos.net
I know it's obvious. Who would strive to change if it was not his desire? But how do you change? What is it that motivates the change?
Sometimes we force ourselves when the desire is not strong enough or because it comes from others and we are not really convinced of wanting to change.

Step 3 : Make efforts.

Yes, change will require an effort, that is evident. To make an effort is to commit yourself to take time and money if necessary. To make an effort is to consciously work on that behavior that needs to change.
It is not that you must exhaust yourself or get frustrated about it, but to be aware that there will be a time when you have firmly decided that things really must change and you feel ready to accept the transformation.
What will you do when you'll face the first challenges?

Should I Invest in Bitcoin Now, Exploring the New Currency

Monday, December 9, 2013

What are bitcoins?

The word bitcoin literally means currency in bits. It is a decentralized virtual currency that no one controls. You can buy bitcoins as if you bought currencies. You can get paid or pay in bitcoins and there are more merchants accepting that currency.

Maybe at first the idea of using bitcoins is a little bit scary, but it is very simple: the programs to handle bitcoins are open source and free to use and the transactions are encrypted and public.

It is a mode of payment and a way to save money as well, but investing in bitcoins is another subject.

Why bitcoins?

Bitcoins exist in response to traditional currencies which are 98% virtual and the rest is in the banknotes in circulation.

The drawbacks of the traditional coins are:
  •     It is controlled by a central bank.
  •     Is in constant devaluation, that is manipulation.
  •     The state controls all movements.

Why bitcoins are interesting?

You can send and receive money around the world at no cost.

Nobody controls, limits or prevents your transactions.

The bitcoin is relatively independent from traditional currencies and allows, in theory, to protect your assets in case of collapse of the euro or the dollar.

This means that you could buy anything even if it is illegal, bitcoins are just a tool and what you do with it is up to you alone.

How much do they cost?

The value of bitcoin it's just shooting up and no one knows how far it can reach. The mass of bitcoin is limited to 21 million today, which in theory also limit its value once everything has been distributed.

The value of bitcoin is very volatile

The volatility is hight from 700-540 dollars in two days last November and now (December 2013) has surpased $1000 and the value changes every five minutes.
Source : http://www.businessinsider.com/bitcoin-540-2013-11
At the moment while I'm writing this article (9 Dec 2013) China's government has banned bitcoins so the value has gone down to $576.
I would say that news and rumors are the only rules with bitcoins.

The risk of bitcoins

The dangers of having bitcoins are basically these two :
  1. Fraudulent intermediaries such as the case of China Limited Global Bond platform http://www.techienews.co.uk/972880/bitcoin-trading-platform-gbl-shuts-5-million-bitcoin-disappears/  that was supposedly an exchange platform on bitcoins registered by the state, when in fact it was all about scammers that have stolen 5 million in bitcoins.
  2. Cyber thefts victims because of the lack of security of platforms hosting wallets.
As everything is new it is easy to find unscrupulous people, these are the limits of a currency that is not subject to any rule, but it is something you can easily avoid working only with services or recognized companies only.

Another possible risk is to invest in bitcoins and then to have to get the money out in a time when the value is lower. But this would be the same risk as if we were investing in foreign exchange.

As the whole system is in a period of experimentation it could disappear suddenly and you could lose all the capital . The probability of this happening is remote, but we can not exclude by prudence.

How does it work?

To use bitcoins you do not need a card id and an appointment with the bank, you do not even have to give any information.

You have to download a program that lets you have a wallet with wich you can generate code that is the key that you will communicate to receive the money .

By the way if it is installed on a computer you must either save the information for this KEY if you do not want to "lose" money if you computer is stolen, damaged or reformated.

With this wallet you can also send money to someone you have communicated your code.

How to buy bitcoins

To feed your wallet you can convert your euros or dollars in bitcoins in specialized agencies (for approximately 1% commission) or "mining" for Bitcoins (a long operation that requires calculation power from your computer).

You can also get paid something in bitcoins it's the easiest way to get them.

Should I invest in bitcoin now?

I'm thinking of getting a small wallet to experiment. The truth is that I like the idea of bitcoins, because it seems consistent with individual freedoms.

But I would not invest in bitcoins for the moment because there are no rules and because I think that is in a growing bubble period that could burst in any moment.

I consider it an interesting experience to make transactions and a good tool, but would I not use it to seriously invest or deposit a significant part of money.

You can find all useful information on bitcoins in the site: http://bitcoin.org

Leonardo da Vinci, that Ignorant Man

Sunday, December 1, 2013
Leonardo da Vinci considered himself as an ignorant man because he had not learned Latin. All the books on science and knowledge of his time were written in Latin and the language of the universities was also Latin.
But he just had a basic education in school, he learned to read and write and some basic maths, nothing more.
If Leonardo da Vinci was an ignorant, how come he created so many fantastic things?
I would say because of these three reasons:
  1. To ask the right questions and seek solutions.
  2. To take action to end.
  3. To write everything he did.

To ask the right questions and seek solutions

Leonardo da Vinci created a new way of thinking, he wanted to know how everything worked and find the answers based on good observation.

Here are some of the questions and answers of Leonardo:

Leonardo da Vinci, that ignorant man
Credit: Janaka Dharmasena (shutterstock)

Why in the distance the mountains are blue?

Until then, the artists of the time painted the distant mountains green or brown and only the sky could be blue when they painted a landscape.
Leonardo said, the blue color of the mountains is the reflection of the water vapor in the atmosphere in the distance. And so he was the first to paint the distant mountains in blue.

What are the proportions of the human body?

The man of Vitruvio drawing are a good examples of his study of these proportions.
You can read all about these proportions here: http://en.wikipedia.org/wiki/Vitruvian_Man

What is the movement of water?

For Leonardo water movement looked the way hair grows, in spirals. He said that the movement of water is like the air movement, and that movement is the principle of nature.
His research on movement led him to very important inventions, such as gears and the endless screw, without which the industry and mechanics would not exist as we know them today.

How do birds fly?

To design his flying machines he observed the flight of birds and also the flight of a bird without wing flapping or just planning, hence the invention of what we now call a delta plane.

How does the human body work?

Studying the anatomy and the functioning of the heart he discovered how do the valves work inside the heart and how it directs the flow of blood in the body.
He performed autopsies and did detailed drawings of the inside of the human body. His writings could be classified as the first treaty on cardiology.

To take action to end

Experiencing, sketching, creating and manifesting were his constant passions. The most impressive is the perfectionism, the precision and how prolific his work is. His innovative spirit, the desire to go beyond to find the light like no one had done in painting, to find answers in the fields of engineering and mechanics.
The mixture of art and science in a perfect renaissance man. In those times a wise and instructed person knew about maths, art, literature, philosophy, engineering and sometimes medicine. That was a complete person. Today is the opposite, people are so specialized in one single subject that they do hardly get a global vision of things.

He wrote everything he did

Thanks to the diary of Leonardo da Vinci the Codex Atlanticus along with the other Codex, in which he wrote three pages a day, today we can read about all these wonderful things .
Because he left a record of all his creations, ideas and new inventions, the Codex Atlanticus is undoubtedly one of the most important contributions to the advance of our world.

And if Leonardo da Vinci was an ignorant ... that's what he thought of himself.
And you, what do you think about it?

Christmas Time and Consumerism

Tuesday, November 26, 2013
Did you figure out what to put in your budget for Christmas?
As every year we are submerged into a new wave of consumerism, shopping madness and uncontrolled expenses. Some times you have a hard time just finding out what you are going to offer as a gift.
Because a simple, full of love and meaningful gift doesn't have to be expensive. But, would it be appreciated?

We are stuffed ourselves with things. How many things did you buy, then you used it only once and is forever kept in a box?
The other night we went to one of the most fantastic restaurant in Paris, food was great and servers were kind, and even prices were quite affordable!
But reading comments on the forums later, there was someone who said: they don't even have any live music on!
As you can see some people always find a reason to complain, but when you go to a concert you don't get invited to dinner by the musicians, do you?

People are already stuffed with things but Christmas time and consumerism go together well, so people get stuffed up with even more things for fear of lack.
But it is the perception of lack that blocks abundance. Those needs are not real, but the belief of lack and loss are a real thing that make unwanted needs to come true.
We create it.

Christmas and Consumerism
Image courtesy of FreeDigitalPhotos.net
We've got all an automatic reaction towards lack and need. It provokes a permanent dissatisfaction and marketing and publicity people know about it so they are trying to make us believe that with this or that object this feeling of need is going to stop to allow us step on a life of plenitude.
But promises are only for those who listen to them.

We live in an abundant world

In the very ancient times we had to hunt and fight for our lives in order to survive, but today you do not have to kill a bear who is trying to kill you, so you can get rid of it and go and kill a rabbit for your breakfast. Those were hard times, times of survival.

Today we must take a step forward and realize that we've got more than plenty, in opportunities and in values.
I think that that is the mind of a millionaire, the spirit of somebody who sees abundance, who appreciates what he's already got and only get new things when he knows that is going to be enjoyed and used, or just because he likes it and not to fill up a hole of unreal lack.

A millionaire doesn't fall into the trap of Christmas time and consumerism, that is an unreal feeling of lack that will enslave you more into debt, and you are looking for financial freedom, remember?

So, what do you think?

Creativity is Creating the Life You Want

Sunday, November 24, 2013
We are all artists as we are already creating the life that we want. In fact you do not have to be a so called artist, you do not have to be a painter, writer, photographer o any other form of accepted artist to be creative.
If you are creating a family then you are an artist and your family is your master piece or your best piece of art.
If you are creating a business of your own, that is also art.
Are you writing a blog? that is also art and it's intended to be the best possible blog that you can produce.

Putting your art into action

There is one thing I like about creativity the way I understand it, and that is that it is not only imagining things in a sort of long daydreaming state, laying on the clouds playing a harp but it's also manifesting and putting your ideas into action.
Daydreaming with no action it's a pitfall but creativity is putting feet to your thoughts.

Creativity is creating the life you want
Image courtesy of [khunaspix] / FreeDigitalPhotos.net
So many artists were not creating the life that they wanted because they confounded creativity with inspiration and they stayed hanging in a world of ideas only.
They though about their inspiration but never crowned it with the needed action to achieve their work till the end including promoting their master piece, so no creativity!
Here is a simple principle:
Creativity = imagination + action
When you are manifesting you are creating the life you want, it is productive and by far the best work you can do.

Manifesting your own thoughts and not someone's else   

One key step in all this is knowing what you really want and detecting that your desires are your inner ones being born from your deepest heart and not someone's else.
Sometimes we want to please our loved ones and we take a role in life that is not truly ours and we may end engaged into doing something that we don't really want to, filling up the needs of others, but we convince ourselves that we've got to.
It's like lying to yourself, you adopt the desires of another person, to please him/her, that's what happens with contagious emotions, but those needs are they really yours?.
If you don't manifest your own thoughts the voice will quite down and you’ll be unhappy, but this doesn't have to happen. You may also get to a real agree together and use the synergy power to boost your lives.

Ask yourself, am I creating the life I want?

When you ask questions deep inside yourself there is always an answer and you can go beyond and ask yourself: what action can I take today to create the life I want?
That is called aligning with your inner self, that's what I did when quitting my job or when I started this blog, just listening to my inner voice.
I’m sure you will find that little thing to do that will light up your day and get you in the right way to manifest your creations.

How to Quit a Job

Wednesday, November 20, 2013

You know I’ve been thinking a lot lately about quitting my job and there are three things that I need to make clear to my self before I jump out:
  1. To know real reasons why I'm quitting my job
  2. To face my fears before I jump into the emptiness
  3. To quit my job gracefully
The first thing was to tell my loved one that I wanted to quit my job and I was encouraged when I've heard the answer: I see that you stagnate. That was a confirmation and a relief too.

I also had a coffee with an ex-colleague wich quitted a year ago. He gave me real good counsel about how to quit a job and he was a sample of gracefulness all the time.
He told me to get a break as he did by negotiating with the boss to be able to quit the job with unemployment aid or unemployement benefits to which you are eligible right away if your employer laid you off for lack of work.
This is true here in Europe, the thing is that in my case there is no lack of work for me in my company.

1. To know real reasons why I'm quitting my job

I really pondered about this because it is better to know why you are quitting your job before you do it and not find out that you could have stayed when you are in the middle of the process. So I did this little exercise and asked myself:
  • Do I see myself working here for the next five years?
  • If so, could I progress, get promoted or get new knowledge and new experiences?
Well, the answers were negative and I feel my time's finished. I read once that people do not quit companies, but they quit other people. Leaders should stop managing people and just manage the work to do.

2. To face fear before jumping into the emptiness

The defy is about trusting in your capacity to raise funds in the future, to live and pay the bills and to have more than enough money left to enjoy life.
But fear is paralyzing, it just stops you from acting, it's telling you: you are here so cozy in your comfort zone, no need to stir up things, just quite everything down... hush, hush!
But let me tell you that if you don't act, nothing changes, nothing happens and water get darker and muddier and as the time passes by it becomes more difficult to make a move.

3. To quit my job gracefully

I planned my resignation meeting as I planned my first interview to get the job. I had meditated on every word I was going to say to make it really positive.
I explained that the main reason for leaving was the need of new technical challenge and new projects to enhance my experience as a programmer.
I'm also accomplishing and finishing tasks in the best possible way, I've never talked bad about any person, so I'm ready to quit gracefully, ready to start my new adventure.

Money and Couple Problems: a Very Delicate Matter

Wednesday, November 13, 2013
Why do couples argue about money and how to better organize home budget.

Money and personal values can happily go together with your couple life.
Let numbers speak.
Putting money goals together should boost your finances, like a sort of synergy effect (1 + 1 = 3), and in many real situations money and couple problems can be solved with a basic organization and a simple budget.

But which are the basis for happy domestic economy?

Step one: define common expenses

Just sit down together and take pen and paper, or open up an Excel worksheet if you prefer it and type in detail all monthly expenses which may be:
  • Rent
  • Electricity
  • Food
 ..and so on,.. please write down all the expenses in detail even if they are very small..

The goal is to quantify monthly expenses and to determine the exact amount to pay it all.

Step two: how to contribute to common expenses

Money and couple problems
Image courtesy of [sdmania] / FreeDigitalPhotos.net
To find the formula to contribute to expenses and to organize the bank accounts are the key to solve this money and couple problems.
I've found two methods that seem interesting to me:

1. By giving 50% each. 

This method is very interesting when the two salaries are similar. Each one pays half of everything because each one consumes just half of everything.
I will not advice you to split expenses by two like saying: I pay the rent and you pay food and the rest of invoices.

2. Contributing in proportion to each one salary

If there is a difference of more than $500 between the two salaries, each one should contribute in proportion to the amount he/she makes.
This seems right to me because even if salaries are not similar the individual participation is fair.

Step three: create a common accounting system

Even if it is a very simple thing it is always good to keep track of money flow, when things are clear on paper (or computer screen) things are also clear on each one mind.

A common bank account comes handy to pay monthly expenses, once a contribution method is established.

The principle of paying one self first it also works when you are in couple, and in order to work it out you can set up a simple automatic money transfer system that will feed the individual bank accounts with savings.

Each one should keep and watch his/her individual bank account and so you can offer your loved one a present and it always be a surprise without affecting home economics!

And of course these are not the only systems, if you make $2000 more than your loved one you will want to share it with her (or he) so she can get as much personal money as you.
We are talking about love, not a corporation accounts report, and with love balance and sharing are the keywords.

How to make all this work

Each one could have a personal bank account that receive the salary.
Each month an automatic money transfer will pass the accorded amount to the common bank account which will pay common expenses, feed common saving projects and investments.
Each month you would sit together to check bank movements and correct the necessary things to attain the ideal budget together.

There are many more solutions to money and couple problems, of course, it all depend on you, the way you both like it and agree, all that seems fair to you both.

And so, they lived happily forever and ever by letting numbers speak.

How Does the Stock Market Work?

Sunday, November 10, 2013
The stock market is all about companies and dividends and before investing your money in stocks options you need to understand how does the stock market works.

The birth of a company

At the beginning there are entrepreneurs with an idea and a vision. That is transformed gradually into project, but to materialize it they need capital or assets such as machines. These assets are brought by investors, sometimes the contractors themselves. In exchange for these contributions, each investor was awarded with shares of the newly created company.
Then investors become shareholders each with a percentage of the company determined by their contribution. It is important to remember that an action is nothing more than a share of the company. You therefore become owner of a part of the machines, the stock of cash and everything the company owns. The company is therefore launched and can start its activity.

How does the stock market work?

Actions and shares, how does the stock market works?
Image courtesy of [photokanok] / FreeDigitalPhotos.net

The search for new capital on the stock exchange.

After some time the company needs to invest to continue to grow.
There are two options: to borrow money or to issue shares.
When it borrows money from a bank or investors, it works int he same way as it would with you with  your banking institution with regular repayments.
The second option is to offer shares on the stock market. Investors buying these shares bring new capital to the company.
This means that if the total number of shares of the company increases, the share of the company for each share or action decreases.
It is better for the company to have an action from the available 100 which gives right to 1% of the company than 1 action out of 10000 which gives the right to 0.01%. Investors are therefore the new owners of the business.

As long as they keep their shares they receive a part of the distributed dividends and have the right to vote at the general meeting of the company.

In the mean time the stock trade evolves. One day a shareholder decides to sell his shares, he sells them to the market price and gets back more value if the course has mounted since its purchase or a less value otherwise.
As soon as the shares are sold, the rights to the company are obviously lost.

How to buy shares on the stock exchange

There are two markets for the purchase of shares:

The primary market.

When the company goes public and offers directly to investors the shares at a fixed price determined by the company itself.

The secondary market.

It is when investors exchange shares between themselves by buying and selling in the stock market without the intervention of the company.
The price is then determined by a confrontation between supply and demand. Note that companies may decide to buy back some shares which is a sign of good health and good news for shareholders. The stock exchange is a market regulated by the financial markets authority in your country. The companies listed should have the obligation to provide information regularly about:
  • Their annual accounts once per year.
  • A financial report, an activity report and report of the Auditors.
Many companies have habit to publish quarterly financial and activity reports to inform investors.

Why not all companies are in the stock market

Do you see how does the stock market work? Some times investors are making decisions on the company and certain managers don´t like that. Specially if they don´t own a mayor number of stocks, they´ll have no voice.
Being ruled by investors add pressure on performance and reports but especially this imposes additional pressure on leaders. If the stock price is too low, the company could be acquired by a competitor or by investors who would impose a different management policy.

The leaders of the largest companies have part of their remuneration which consists of actions, they have therefore every interest in the fact that the course rises to make a profit on the future resale. Another advantage of a high stock price is that it facilitates the supply of new capital.

Let´s say that the company needs $ 1000, and its course is € 10 then it will issue 100 shares. If its course is € 1 it will be obliged to issue 1,000 shares.
The more it issues shares and the more the value of each is one 'diluted' or low, which is not interesting for investors.

What is a stock market index

A stock market index is a set of values which reflects the global movement of the companies that make it up.

Some examples in America are:
  • Dow Jones
  • S&P 500
In Europe:
  • FTSE 100
  • CAC 40
  • Swiss Market Index
In Asia:
  • Nikkei 225
  • Hong Kong Hang Seng Index
Usually the number after the name represents the number of companies that are included in the index. For example, the CAC 40 index is made of 40 companies.

There are many other products that are traded on financial markets besides the stocks, such as bonds, warrants or raw materials. I did not go in the details on this article on how does the stock market work because they are more complex and need to be explained more extensively.
And now, do you understand how does the stock market work?

Investing on Dairy Cows

Monday, November 4, 2013
Have you ever heard of investing on dairy cows? It sounds funny, but it is a real thing! Here is how it works:

The investor buys heads of cattle (dairy cows), then he addresses to a specialized manager who rents them out for him at a selected breeder or farmer. The breeder provides work, buildings, equipment and land. He raises the cows, feeds them and pays for the illness and accident insurance.

Each cow who dies is replaced by another of the same quality, the owner suffers no loss of profits as everything is covered by the insurance. The farmer keeps the milk, manure and males.
The female offspring are shared between the farmer and the owner, after a levy designed to keep a young flock (this levy ensures sustainability of the flock).
Therefore one does not become a breeder... It is all about investing money.

At what interest rate? 

Investing on dairy cows, buy cattle and get the return
Image courtesy of [digitalart] / FreeDigitalPhotos.net
The owner (the investor) collects about 4-5% of its population a year in nature. He then has the choice between reinvesting its earnings (heifers will be added up to his flock each year, with an average growth rate of 4.2%, then the flock will double in 19 years) or sell.
If he decides to sell, the heifers due to him are sold as soon as they are adults.
In short, this is another investment not often proposed by bankers, but it is a way to diversificate passive income.

Small farmers can benefit from cattle he didn't have to pay for and owners (investors) can colaborate to grow our planet resources and get money from a real "tangible" thing.

An example of investing on dairy cows

There are two options for the return of benefits:
The grow option (keeping new born heifers and no yearly cash income)
A yearly cash income (by selling a fixed number of animals every year)

These are the costs and benefits.
- cost per head 1 167 €
- average yearly yield (in number of heifers) 4,20 %,

The thing is to start buying heads and chose the growth option for a number of years (let's say you grow your cattle) and then get the return of investing on dairy cows.

Let's say we start buying ten heads and then we buy two extra heifers for a period of five years.

Start 1 167 x 10 = 11 670
Buy two extra by year 1 167 x 2 = 2 334
In five years you will have 20 heads, worthy 23 340 wich will yield 980.28 euros/year

It seems that this idea comes from the the middle age, the old times of Richard Lion Hearted, where herd was considered as the real richness.
All this figures and conditions are samples here in France, to read more:
Cows will always be a growing market, what do you think?

Too Much Taxes on Your Savings

Monday, October 28, 2013
Do you know how much you are taxed on your savings?
If you are looking for financial freedom it's the time to watch new laws about taxes passing through.
Just look through all your investments and check for new possibilities, do not hesitate to surf on better waters, as Warren Buffet says: "if you ever find yourself on a sinking boat, the energy to change boats is more productive than the energy to fill the holes".
New laws are passing now here in Europe and taxes are booming everywhere, how can you adapt to all that?  This is the Robin Hood syndrome!

But the situation is delicate and it is difficult to predict what's going to happen and that makes this moment a very interesting and intense one!


  • Debt has never been so big.
  • The price of money is very low.
  • Taxes are not effective anymore because of the Laffer effect, which explains why too much taxes will get no income tax at 100%, because there is no incentive to earn income.
  • The assets level is artificially high.
  • The developed countries are all going through a similar situation.
  • The Euro unbalance does not allow countries to recover.
  • Because of some foolish laws which are making that part of capital, ideas and entrepreneurs are going away and how many will get back?

So, if you are getting too much taxes on your savings, what to do?

  • Get assets for essential values at a fair price.
  • Develop your self, you are your biggest asset.
  • Be prepared to buy assets at a good price when panic hits and prices fall.
  • Keep open to opportunities, keep mobile.
  • You may create a new activity in another country.

Keep calm

Yes, panic is the worst thing, really,  you need to stay cool and calm to handle this situation for the best, and it will be your very best indeed.

Real estate is, for me now, too expensive at least in some areas.

This does not mean not to invest (good profit is always a good profit) but prepare for a medium-term capital loss and be very selective about the choice of the property.

Prefer the security of international companies with a competitive advantage rather than companies depending on the state or the financial market.

Do not fall into panic by converting your entire patrimony to gold or silver, but rather study your actions and get financial wisdom to not get too much taxes on your savings and invest on the best products.

Leading Yourself: You Are Your Best Teammate

Wednesday, October 23, 2013
When you feel good about yourself everything is easier. Your ideas flow freely and you have creativity.
It seems that creativity needs a good environment to grow, it seems to come when we are focused and we are in balance, when things go well.

But life presents swings, those times when we need to provide more resources, to put more into it and give more of ourselves to overcome obstacles and prove our worth.

How do you react when things do not go as you want?

As the old proverb says:
He who controls his spirit is stronger than he who takes a city.
And this is the biggest test of all: to look deep in the mirror and see what relationship do you have with yourself.

If you want to achieve great things then you've got to be able to act when you do not feel like it or when things are not going well.

  • When you take care of yourself leading the conversations within yourself and knowing that to criticize or complain inside your mind is dangerous because the brain can only concentrate on one thing at a time, and you know you need all your capacities to seize the best opportunities.
  • When you're leading yourself you have prepared the necessary actions to manage emergency situations.
  • When you're leading yourself you accept the criticism and try to learn from it without anger, without turning back to crush the enemy, because you recognize that if you are criticized it is because you are impacting people.
  • When you're leading yourself accept praise without ever troubling your sight, just give thanks and keep on going.
  • When you're leading yourself you have a plan, you have goals and a vision to fulfill.
  • You've got ideas that are out of the routine and do not allow the system to run your destiny. You behold this world as a wonderful place, a place full of mystery and beauty that moves, lives and experiences , rather than seeing it as na hostile and full of injustice place where you can only protest or complain.
  • When you're leading yourself you've got the power of anticipation and believe in your ability to create your future because only you have full responsibility for your present, taking the necessary decisions about your life now.
  • When you're leading yourself you are acting now, because you recognize the value of an opportunity.

Watch your thoughts, directs your intentions

Our mind "speaks" constantly, it's like a continuous stream of ideas - words that runs through our mental screen. We have to monitor the source of these ideas, whether it is television and newspapers and all the information circulating on the Internet, what do we tell to our brain ?

It is clear that we have to keep up with what is going on, but we must filter all that information and minimize the input to the essentials.

It is the only way to have enough room to listen to your inner voice, or intuition, which represents the true guide in your life.

If you allow the media and the Internet to take up all your space, then they will be your leader.


Intention are the first ideas that feed your brain when you are going to perform an act, that's why it is so important to monitor them.

And when you undertake something, examine your intention.

One idea is like a seed, is the first idea that drives you to take action. According to your intention, so will the result be.

As I wrote about saving for your financial freedom and the creation of an emergency fund in case of need, where you are creating a savings plan focused on the need, and that is precisely what you are attracting with this intention : the need, something that works against you.

Saving would be like loosing rather than save to create money.

In this case it is better to decide to save to invest or to save for a project, something you want and it will return to you.

It's like creating a blog, I created MoneyAndPersonalDevelopment.com to share all the information about financial freedom and encourage people to get out of economic problems.

Money coaches are in the trends now, and they will charge you many dollars for an hour of consultation, well, just start reading all this free information that will pave the way for you to learn to manage your money and achieve your goals.

A large part of this web site is dedicated to personal development, and that because it is that something is related to the other: inner wealth is the first intention to manifesting abundance and balance in your life.

And you, what do you think ?

Save for your Financial Freedom

Tuesday, October 8, 2013
You have surely heard it said: save money for the lean times, save for the bad days, or save for the rainy
Even I myself have written enough about creating an emergency fund to deal with any problems or immediate
But in this way we are turning the act of saving in a projection of loss, I mean that it is like saying, Save
now to lose it all later.

While it is prudent to start a savings plan for prevention, this should not be the only goal.
The road to financial freedom has to be a way that makes you enjoy, that changes your scheme of scarcity by a

State of abundance, is a way of learning and training yourself and is very exciting to know that every dollar that you save or invest works for your freedom.

Save to create money

To win you need to take some risk, provided that it is a smart and calculated risk, obviously.
A part of your income or your savings could be for a risk's controlled project as shares in stock market (if

you know what you are doing and do not invest money that you can not loose).
Because I think that the more constructive thing you can do to generate revenue is to take action.

Just think, what can I do to create money today?
Just focus on the only thing that you have in hand: the present moment. Do not sink with concerns about the future when the only thing you can change is today, think on what actions you can take today.

Save for a project

The most important project is to save for your financial freedom, this is what will help you to manage all the other projects in your life, because when you have financial independence then you can decide for yourself about what is really important.

Don't forget that biggest investment it's yourself, you are the potential you're most interested to build
already by learning or implementing your projects. This positive attitude will make you believe in you,
because you are the source of your money.

If your action today is to save for financial freedom, study the financial product you have chosen,
performance, taxation, availability, cost, etc.. And if you find something better, please do not hesitate to
change it soon.
In short, it is all about saving to build, create, or for any project that motivates you and do not think of
saving as a cure for disaster.
It is important to rectify the intention and that is positive from the beginning, as it is the only way to
harvest good fruit later.

American Middle Class Financial Portrait

Monday, September 30, 2013
Europe looks towards the Uniteds States economy as to a mirror and so do almost all the other countries. American middle class families are a model of prosperity and well being to the whole world.
But I'd like to share with you this financial report to check how things are going on now.

Real Estate Sector

Image from: http://stawealth.com/images/stories/1dailyxchange/Home-TotalActivityIndex-072513.PNG

In the real estate sector, whose collapse is at the origin of the financial crisis of 2008-2009, home prices are certainly increasing ("12.2% year on year, according to the July S & P/Case Shiller index), and the resale market is also growing.
However, the real estate industry confirms a slowdown in demand this summer, faced with the recent rise in mortgage rates.
The total of the mortgage debt in the United States is now about 5 times larger than it was 20 years ago. And the rate of delinquency these mortgages which was of the order of 2 per cent in 2000 is today to almost 10 percent.

The rate of home ownership in the United States is the lowest it has been in 18 years and it has become more expensive than ever to rent a home in America. In fact, the rent charged median rental vacancy comes to reach a new record ever observed.

Retail Sales Sector

Retail US is 'active' at first sight for a year, especially in the sector of the automobile ("0.9% in August). But the consumer confidence declined significantly in September, and the store sales slowed in August ("0.2% after a gain of 0.4% in July), which is a sign that American households is diminishing quickly.
Is that the indebtedness of consumers in the United States increased 1700% since 1971, and 46% of all Americans are to postpone a balance from month to month paying credit card.


As it confirmed from the most recent statistics (August), unemployment in the United States certainly continues to decline (7.3% or 0.1% less than in July). But the decline is slow. And if unemployment decreases, this is not for good reasons.
This is not so much the hiring which increase than the the growing number of Americans who give up looking for a job.
More than 90 million Americans of working age are considered "not or no longer on the labour market"... What is called the 'participation rate', or the share of the population that has a job or seeking one, fell to 63.2%, a low in 35 years!
In short, Americans abandon the market of labour by the thousands. -516,000 Americans "have left the labour force" only last month. What constitutes a record upward the largest ever observed!
"Employees who have given up work represent three-quarters of the decline in turnout since the start of the recession," in an economic note, deplored the Economic Policy Institute.
Even workers in the prime of life drop out: more than half of people (53.7%) have renounced work are aged 25 to 54.The number of private sector jobs fell by 278,000 last month. 77 percent of the jobs that were "created" so far this year have been part-time jobs.

Not to mention that the quality of jobs created is often unsatisfactory. The U.S. economy continues to exchange jobs paying against low paying jobs.
60 per cent of the jobs lost during the last recession are average wage jobs, but 58 percent of the jobs created since then have been in low-wage jobs.
In 1980, less than 30% of all jobs in the United States were low income jobs. Today, more than 40% of all jobs in the United States are low income jobs. According to the Brookings Institution, some 70% of hirings since the end of the recession were in areas with low labour costs, like fast food and retail.

What economists call "McJobs", a reference to low-paying jobs of the type fast-food restaurants.In this regard, the portrait is distressing: adjusted for inflation, wages at McDonald's have not progressed in 50 years, according to American studies.

Household Income

According to the Census Bureau, the median household income was in 2012 and US$ 51 017, almost at the same level in 2011.
It is still 8% at the level of 2007 and 9% below the historic Summit of 1999 (adjusted for inflation). It dropped 7.8 percent since the year 2000.

According to research, between 1969 and 2009, median salaries earned by American men ages 30 to 50 declined 27 per cent taking into account inflation.

French source: http://leblogalupus.com/2013/09/29/breves-de-trottoirs-du-dimanche-29-septembre-2013-la-longue-descente-au-enfer-de-la-classe-moyenne-americaine/

How Much Money do your Dreams Cost

Wednesday, September 25, 2013
See how much money does your dreams cost and just create a financial plan to get them true.
Maybe you've talked to someone about your dreams and maybe you've heard that answer: "You're not realistic, you could never afford those things".

But why?

On the other hand when you're a child they allow you to have all kinds of dreams and you can become an astronaut, mountaineer, artist, pilot or whatever.

Then when you reach the adult age then you have to be a lawyer, a doctor or a consultant, then create a family and make sure you put your money in your favorite savings plan. In the best case you can pay you a few weeks of vacation if your home and auto credit allow it.

However I know some people who even earning less than 1500 dollars have made trips to Bali, New York, Thailand...and I was wondering which may be their secret.

How much money do your dreams cost?

Imagine that your dream is to go to visit Paris and you need about 4,000 dollars. But what if you'd about it on a monthly basis cost rather than the total amount?
It would be exactly 333 dollars/month for a year.
To go around the world with a budget of € 6,000 will you cost 500 dollars by month for a year.

How did you spend the last 333 dollars?

Maybe you can save 333 dollars every month by trimming here and there because now you realize that you could have done many things with those 4000 dollars that would have gotten in just a year.

Finishing One Thing at a Time

Tuesday, August 6, 2013
Finishing one thing at a time is a virtue, as you work kind of block by block towards the construction of a bigger building. I have a bunch of dear old projects and my "to do" list was growing too big.
There is only one way to get things done:
  • Set your priorities
  • Work on one thing at a time

I was kind of overwhelmed these last times and couldn't keep the pace with all so many wonderful things I've got in my mind willing to manifest in our real world, but I've just decided to:
  1. Finish my first eBook (written in Spanish)
  2. Go on to work on my web sites
  3. Look for better professional opportunities

It took me nine months to write a 90 pages book, but it wasn't the only thing I was doing, so to set my priorities right I had to decide what was more important and leave the other things to finish them later.

Some times the most important things are the foundation of others, they kind of rely on it. Or they are just an important step for you to climb higher.

Multiprocessing things

But when your mind is really in a creative state, there is a kind of multiprocessing phenomena that takes
Finish one thing at a time
Image courtesy of [koratmember,] / FreeDigitalPhotos.net
place, and when you are working on one idea in a very concentrated way there just: boom! another one pops up. Just because one idea acts as an inspiration for a new one.
 This is a real quality and a gift that we need to learn to handle and organize it. This takes real discipline at the very moment, because our human trend is to jump to the new rainbow and explore the new heaven right away.
What I usually do is to jot down quickly the sketch of the new idea or the basis of it, so I just can keep "calm" to work on my current one.
Because for the practical manifestation of what you've created you need to finish one thing at a time, once you've finished you can check it as "done", which will give you a great satisfaction.
But if you've got too many open fronts, too many activities going on at the same time your efforts will be dissolved and you'll be less effective and you will end up with nothing in your hands.
Personal power is taking action and responsibility and only by finishing one thing at a time you will get things done.
And you, how do you manage things?

I Need a Job Change

Monday, July 15, 2013
I am looking for a new job, I want a job change. Sometimes you don’t know when to shift and change or when to stick and stay. It all comes mostly from your inner heart.

Here are some good reasons to change jobs:
  • You are not learning.
  • You can not give ideas nor take initiatives.
  • Your work is routine, almost industrial.
  • Your salary is well below the average.
  • It’s been a long time since you had a salary increase.

Work to learn

We are in a new era, the era of communication and progress. Before it was enough to do what you were told and that was it.

But working only to run the race to see who does it better and faster, is not the solution.

Someone will do it better and faster than you.

There is only one way to do things and it is to do them better and for this we must analyze the process and change what it is necessary.

This act can only be done if we share our ideas, if we listen to the ideas of others and talk about ours.

You need to learn.

Being in a job that will not let you learn will make you lose time, and in the end even your job! Learning does not necessarily mean going for a training or courses.

You can learn from the process and it is therefore necessary that the information flow.

The salary

The salary is not always an indication that you are in the best job for you. You may have a good salary but you're wasting time because of stagnation.

While a raise should go with the fact that you are in a place that makes you progress.

If you stagnate and your salary is well below average, start to looking for a new job and change things now!

Motivation to Get Out of Debts

Thursday, July 4, 2013
One year ago I started writing this blog about financial freedom.
Until that moment I looked at the state of my accounts, just waiting to get my bank counselor's call towards the end of the month to warn me that I had an important overdraft and I had to do something about it.

In one of the interviews with my counselor she convinced me to ask for a new credit to pay the one I already had to cover the overdraft and with the rest I could buy me some extra things.

Obviously this was a big mistake that I'm still paying for.

Instead of increasing credit costs that had to be reduced, I should had put some money aside to lower the debt.

Besides this error, I also asked for other small loans to pay the continuous overdraft.

There you have the vicious circle: you spend, you go into debt, you feel guilty and back again.

Well, this created a huge snowball debt and at that point I started looking for inspiration to get out of trouble.

Seeking financial peace

The first was start putting things in order.

Reading the book Rich Dad, Poor Dad gave me great motivation to take my finances in my own hands.

Here are some of the basic ideas I've learned from the book:

  • Being independent and not to rely on the government or your boss. Some people now are asking themselves whether they'll get a retirement pension here in Europe. It is wiser to have some snap to always be financially independent anyway.
  • Make the difference between good debt and bad debt: good debt is used to invest. Bad debts are those contracted to buy consumer goods or to buy a car.
  • Learn personal finances: knowing how to manage money and know what your bank do with your money.
  • Having assets that generate income, or invest in real estate.
  • Work to learn, not for money.
  • Know who you need to talk to. If you want to invest in a domain, look for the right person (the agent, banker), which has already taken this step. Do not go through a broker who does not have the perspective of an investor.

Motivation to solve financial problems

To transform these parts of our lives that have become routines we need motivation.

That is why it is best to start small, with small gestures that will help us learn new habits and see the results that encourage us to move forward.

Of course, if you are 100% motivated, go on!

No need to be an expert in finances or taxes to begin with these changes.

Kiyosaki gives very simple ideas talking about passive income and how to get assets to generate them:
  1. Buy or create passive income generating assets.
  2. Every dollar saved and invested is a dollar that works for you.
  3. Financial freedom is achieved when your passive income is at or above your salary.

What you do not learn in school

School is only a training center for future employees.

I think he's right, because that is where they begin to create the robotic race individuals.

On the other hand it is clear that we need advanced education, particularly regarding  money, something we've never learned in school and sometimes economic problems help us see that we have to change things.

What do you think?

SEO Experts will Make you Loose Money

Monday, July 1, 2013
If you're starting a new web site because you want to boost your business or build your personal brand or reputation, or for any other reason, stop doing SEO.

Wasting time on SEO forums, following the advice of those SEO 'gurus' and putting into practice the tricks of these experts, will make you make mistakes that are going to be very difficult to correct.

Two days ago I've got an email from someone who was desperate because after hiring some SEO services his site rankings and visits are going down, down. He wanted me to analyze his site and report him the problems. Those SEO services were doing some massive link building, artificial links and links schemes.
This is the case of many web masters who are loosing ranking and visits with the latest Google Penguin 2 update roll out.

SEO tricks are dangerous to the health of your web traffic

Especially all those tricks that go against the best practices published by Google and against common sense.

One of the strategies that has done more damage is the creation of satellite web sites, web pages that are created specifically to put links aiming directly or indirectly to other pages target.

Since link building is becoming more complicated, these schemes create artificially made links that have worked for a while, until I the latest Google algorithm update, the Penguin 2 that has brought down many pages.

The worst thing is that they had paid for SEO services and so lost money, and the worst of all, they lost traffic.

If you want a web site that works well and that will attract visitors, concentrate on building up  a good web site, and that was your intention, anyway? It's too risky to expose yourself to a penalty, simply because you are in a hurry to get results.

Natural SEO and authority

Now you cannot fool so easily the search engines as it was before, and before losing half of your business or visits, works positively on these things:
  1. A good SEO on page.
  2. Avoid duplicate content on your own web site.
  3. Create good content: if what you offer is good it will go long way, if it helps someone, somewhere it will reward you back.
These three elements help give your page authority, because you have something good to offer, and time and perseverance will bring your visits.
Natural SEO is the only way to stay when many others will be gone.

Leave Credit Cards at Home

Sunday, June 23, 2013

With credit cards you spend what you haven’t got and you go into debt more than you should.

In this country is almost mandatory to have a credit card. If you pay the toll booth with a Master Card it does not work and in many toll booths the payment is automated so you can not pay in cash. The only thing that works is the credit card.

But unless you have to go down the highway every day, you don't need a credit card to live.

Leaving our credit cards at home

Live without credit cards
From now on we decided to organize our domestic finances differently: at the beginning of the month, just after getting our salaries, we’ll withdraw a certain amount of money to take in our pouch, let’s say $ 100, and leave our credit cards well keeped at home.

The problem with credit cards is that you do not control what you spend because you do not see money coming out.

The card payment gesture appears to have no impact on the domestic economy, when it is just the opposite: it is the easiest way to spend without counting, the beginning of the disaster of your finances.

Now we get our only credit card for certain major expenses, such as shopping the month or going on holiday, when it is safer to pay with a card.

And to go shopping we make a list and we set a limit amount to spend that we should not normally exceed.

Having the cash in your wallet helps you to control it better, to count how much you spend, to think twice before buying anything and cheer up when you see that you can buy something extra for you with bills you didn’t spend.

All this is part of a healthy economy.

How are we going to control money with a credit card if you don’t see it?

Domestic economy the old way

I  remember the old days when the women in my family handled money at home. And although salaries were not very high, they always had money for everything. There always was a bill out there and they had provision for all expenses, then they went to the hairdresser, family outings or any other extras.

And as there were no credit cards, they could not spend beyond limits and have the bank account in red numbers.
The credit card has stolen us the pleasure to enjoy money because it is more convenient to have it, because it is safer if someone steals you, but mostly because it is easier to spend what you haven’t got.

I'm not saying we have to go back to those old times, but why not enjoy money as before?

Can You Get Out of the Crisis with a Barometer?

Wednesday, June 12, 2013
A physics professor calls a colleague about a problem with a student who has just had an examination.

The teacher wants to give a zero to the student, but the student thinks he deserves full marks.

So the other teacher has to be the referee and decide on the problem.

And here's the examination’s question: How can you calculate the height of a building with a barometer?

And the answer given by the student was:

- "You tie a string to the barometer and glide it gently to the ground, then calculate the length of the string, that gives the building height."

This solution gave a perfect answer, but it was not the answer the physics professor expected, so they decided to give him a second chance and agreed to allow him 6 minutes more to find the correct solution using his knowledge of physics.

And the 5 minutes passed by ...

But the student had not yet written anything!

One teacher asks:

- You don't know the answer, do you want to leave?

And the student replies:

- On the contrary, I have many answers to this problem, I'm just trying to choose the best one.

And finally responds:

- You put the barometer on the roof and let it fall down while measuring the time it takes to hit the ground with a stopwatch. Then using the formula: x = gt  / 2, this is the height of the building.

But this wasn't either the answer the physics teacher expected, but the teacher that acted as a referee decided to give the student the maximum score.

After the examination was over, the referee professor called the student and asked him:

- You told me you had several solutions to solve this problem. Could you give me another one?

- And the student quickly replied:

- If, for example, you put the barometer outside in a sunny day, then calculate the height of the barometer, the length of the shadow casted by it and the length of the shadow casted by the building. After a simple rule of proportion we find the height of the building.

- Very good! - Replied the teacher, what were the other answers?

- We climb upstairs with the barometer while we mark the height of the barometer on the wall from bottom to top. At the end we count the number of marks to get the height of the building measured with the height of barometer unit.

And then he gave other answers:

- You can also tie the barometer to a string and swing it like a pendulum. Then you can determine the value of g at the floor level and at the roof level. Then you can calculate the height of the building from the difference in g.

And finally he said:

- There are many other ways to solve this problem. The simplest way may be to get down to the basement and knock on the door of the janitor's house and tell him: this wonderful barometer will be yours if you tell me the height of this building.

Finally the teacher asked if he knew the answer to the other teacher expected of him and admitted that yes, but that he was tired of teachers trying to teach him how to think.

This is a true story, that of Niels Bohr, Nobel laureate in physics in 1922 ...

What can we learn from this story?

Obviously, we can draw many lessons from it, but for me the most important thing is to always seek alternative solutions to a problem! Our education teaches us that usually there is only one solution to a problem, the famous dogma of mathematics ... but it is wrong!

We live in times where we need more imagination (and more action), as the sources of income, the more you have, the more security you’ll get. Here are some more solutions that will likely help you to live in prosperity and ignore the crisis ...

The idea is to get out of your comfort zone and try new things ... If you're like everyone else, you will have the same results as everyone else ...

And you, what lessons do you take from this story?

How Would the World Be Without Money

Sunday, June 2, 2013
Have you ever imagined how the world would be like without money? Recently I was talking to a great friend of mine who was explaining to me his ideas about money and this made me to think about it.

According to him, an ideal world would  perfectly run without money because everyone could contribute according to their ability and receive according to his need.
Money is needed only because of the exchange of the property on which our society is built, if there were any other way to organize society then money would not be needed.

This long conversation made me think about many questions:
  • Why do we think that in a perfect world there would be no money?
  • If we remove money, would this make a perfect world?
  • And since we are talking about an economy of services, who would organize the equivalences?
In ancient times people used barter to get things: I give you a goat in exchange of four sacks of wheat, but who said that a goat was worth four sacks of wheat?

With barter one of the value scales is time: if it takes six months to raise a goat, for example, this is worth more than a crock pot that you can manufacture in one single day.

In our modern times we would need an enormous reorganization to determine a worth scale to sustain a balanced economy without money.

In my humble opinion money is not the cause of all the ills of the world, that would be a very easy way out for some who try to evade responsibility, but human condition should change to adapt to the new organization.

But if money is not the cause of all evil, why do without it?

Have you watched the film "In time" with Justin Timberlake? there's a good example of a world without money, a world in which time is the universal currency, when someone wants to get something he’d pay with a portion of his life time and work’s salary is time, more life to live.
The horrible thing is that when someone didn’t have anymore time left just died.

But going back to the main subject here's what I think of money:
  •     It is a world heritage whose price has to be determined fairly.
  •     It is a tool that we have to learn to use.
  •     It's what we exchange for something that has value, but money itself has no value, it is only a tool.
What do you think?

Financial Storm: Good times, and Bad times

Monday, May 20, 2013
When our finances are going well we tend to spend on things we had not expected to and we don’t take advantage of the good times to save.
And, as we see that we have a certain amount accumulated in our savings we immediately spend it, it's like an impulse there that sees that when there are more than 1000 euros saved in the account it invents up the need. (My car doesn't work so well, my TV screen is an old one, I need a last generation smartphone ... etc)

But if an unexpected event comes, as having to pay a lot of taxes we never expected, or a sudden need we had not anticipated, we find ourselves in financial danger.

If you've ever suffered financial turmoil these are those difficult situations that comes once in life to most people.

When this happens is when we pay attention to expenses and use the credit card very carefully, create spreadsheets to emulate an accounting program and follow up every cent and cut all  that is unnecessary, such as cable TV and the rates of mobile phones. And reduce cigarettes, the cinema, going out to restaurants and gambling.

But mostly we never ever want to go through there ... because we’ve been force to become frugal, even too frugal!

We can use this painful experience and learn the lessons necessary to not happen again, starting new habits and adopting new schemes that will change our attitude toward money.

Paying yourself first

One of the simplest techniques to adopt good habits is to pay yourself first, so you get used to save before spending, which is great. You can start an automatic savings plan that is scheduled at the beginning of the month before paying your bills.
It's best to put it in a separate account a different one from your regular income and expenses .. forget you have it there .. and let interests work for you.
You know what? When you save money the bank borrows money from you who will pay you back with interest (up to 3% - 4.5%), when you borrow money from the bank it is you who pays the interest (from 4%, 5%, 6%, 7% and on!).
It is better that the bank owes money to you!
What do you think? Have you ever been in a financial storm? What did you learn from it?

Buying a Car with Cash or Taking a Loan

Friday, May 10, 2013
We know that a car loses its value very quickly, which is really a liability in our small domestic accounting, but sooner or later you would want to buy one for family, professional or just for pleasure reasons.

The idea is that if you have to sell the car quickly, with the amount you'll get back you can pay the credit you asked for completely.

Case 1: Car price: 10,000 $ buy by borrowing 100% of the amount

To Buy Car: Loan or Cash?
Photo: http://www.freedigitalphotos.net
(I just thought of 10,000 because it's a simple number to deal with)

Suppose that you get a car loan at 5% interest rate over 5 years:

Monthly payment => 188 $

Total cost of credit => 11322 $

After one year the capital needed to pay your credit is => 9066 $

In this case there is a very small chance that you can resell the car for 9066 $

Case 2: Car price: 10,000 $ you ask for a loan of 6700 $, with a contribution of $ 3300 (about 30% of the whole price)

Suppose that it is a car loan to the 4% interest rate to pay in four years:

Monthly payment => 151 $

Total cost of credit=> 7261 $

After one year the capital needed to pay your car loan is => 5449 $

Now there! After a year, you can get the money back to pay it all and the opportunity to buy a new car if you wish to.

Purchase Plan

Having a purchase plan helps you to:

  1. Force yourself to save at least a part of the whole price to buy the car and think about the project taking in consideration your income and your other personal projects. It would be ridiculous to buy a car for 20,000 $ and take a credit of 400 $ for 20 years to repay.  
  2. When you save your money you are lending to the bank that will return to you an interest of at least 2% or 3%. However, when the bank lends you money you are paying a 5%,6%,7%... interest. So the less you ask to the bank, the more money you'll have in your pocket.

Case 3: Buy the car 100% cash

This means you had 10000 $ saved, well done! But what if you have empty off almost all of your savings, because let's say you've saved 12 0 15 000 $, and if you spend all this money at once, this will leave you unprotected against an important unexpected need, and you would have to sell the car again very quickly.

To be hurry to sell something is not good, because you would be selling for need and you could lose money.

So, I would keep my savings and buy the car with a 30% contribution asking for a credit for the rest.

And if you sell the car, try to sell it to a particular to avoid the salesman commission.

What do you think?

Generosity: Thoughts on Giving

Tuesday, May 7, 2013
The great American billionaires have a sense of giving mission and always end up becoming benefactors.
Rockefeller gave ten percent of his income since their first salary. Warren Buffet and Bill Gates are going much further and think that the rich should give half of their wealth.

Thus began their campaign for billionaires "The Giving Pledge" http://en.wikipedia.org/wiki/The_Giving_Pledge

They and many others, are all great philanthropists that are returning a portion of the money they make to the source where it came from: humanity.

But why giving?

For two main reasons:

  1. Just for sharing, you are giving the necessary first step to get rich: sow. Sowing the seeds that will give you rewards when the time comes. If there is no seed then there is no fruit. Without sharing, there is no harvest.
  2. By giving you are sending information to your brain and saying it that it has more than enough. Although you may not have it physically! To meet your expectations, your brain receives a message of abundance. From abundance because however little amount, it is enough to give.

Thoughts on giving
Image courtesy of [anankkml] / FreeDigitalPhotos.net
There are people who have accumulated so much and so much money that they end up being afraid of losing it and become greedy and will never be satisfied with what they have. There are those who having almost nothing are also greedy.

In both cases they have great insecurity and have not understood that to receive we must give. Nature itself teaches us that some of the best grain must return to earth to grow new fruit.

By contributing to the progress of mankind, the development of culture, art and communication we make ALL richer.

If you were a millionaire you probably like to see that the rest of the people also have prosperity, in which way would you like to contribute?

Personally I think that in order to give you do not have to be billionaire: to make money you have to learn to spend wisely. To receive we must give, not just money, but your time and personal dedication too.

But give wisely, of course.

Alejandro Jodorowsky, speaks of giving once a week, and every Wednesday he gives free consultations at a bar in Paris called "Le Temeraire", he says:

    Once a week, teach others for free  no matter how little or how much you know. What you give them, you give it to yourself. What we do not give, you take it off from yourself.

Humans are social animals, we are all united and we tend to serve, to add value and make this world a better place to live.

So we feel useful and part of a unity that is much bigger than us.

Therefore, everything we do for others, we are doing for ourselves.

What do you think?

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