You think that when you make enough money at work all your money related problems will take care of themselves
Actually the opposite is true - over 90% of people winning a multi million dollar lottery end up with less money just after 5 years of winning.
Getting rich takes effort and planning. If you are not interested in money then chances are that money is not interested in you.
9. You are afraid to lose your money
You are so afraid to lose your money that you keep it in an ordinary bank account with a terribly small interest rate. You are afraid to invest your money because you think that the risk of losing everything is too great.
By keeping your money on a savings account, it generates less interest than the inflation. This means that by keeping your money in a safe place you are actually losing it to inflation.
8. You invest in what you don’t know
After reading a story about a new high tech invention you decide to invest all your money into this startup company. If it’s high tech and complicated it must be a great invention, right?
Wrong!
Investing your money in what you don’t understand is the fastest way to losing everything. Something that looks like a good idea doesn’t have to be one. Stick to what you know and you will be able to keep yourself from the dumb ideas and go along with the great ones.
7. You hope that other people will take care of your money
You give professional money managers free will to take care of your money as they wish. Everyone wants to have more money so they will just end up making a lot of “necessary transactions” - of course you are the one paying the transaction fees.
Take care of your own money - always have the last say in what to invest and what to buy.
6. You want too much too fast
You want to get a lot of money fast and with little or no effort. This makes you go along with tens of get rich quick schemes that always end up losing money. Your decisions are affected by the need to get a lot of money fast, which makes you take unnecessary and stupid risks.
You need to remember that there is no such thing as easy money.
5. You don’t have an emergency fund
You spend everything you make and don’t keep an emergency fund for unexpected things. If you are not covered by insurance an accident can set you back tens of thousands of dollars.
Without an emergency fund you would need to borrow to come up with the money. This also means that you will have to pay interest - not having an emergency fund can end up loosing you a lot of money.
4. Your goals suck
You don’t have any goals and even if you have one - its awful.
Just about every 10-year-old wants to be rich and famous but only a few will actually get there.
You need a goal that says what you want to achieve, how you are going to achieve it and by what time will it be achieved.
After coming up with a goal you will also need to make a plan on how to achieve it. You must be able to measure your progress at any point to get feedback on how you are doing.
3. You have bad habits
You smoke, drink and watch TV all day long. You spend money on the things that will never bring you anything back. In the long run you need to spend even more money on health in order to get back to your best drinking shape!
A bad and devastating habit can also be negative thinking. Research has shown that people who are more willing to keep their mind open and positive to new ideas are wealthier than pessimists.
2. You are impatient
You want to have everything now and are not willing to wait in order to buy it later. The concept of saving money for something you want to buy is not known to you - instead you use one of your many credit cards.
You probably haven’t heard that using a credit card makes other people rich (owners of credit companies) and keeps you poor.
1. You buy everything your neighbors and friends have
Trying to impress your neighbors and friends by buying all the stuff they have plus everything they would like to have? Don’t do it - spending money on things that you really have no need for is the number 1 reason why people have less money than they want to. Having a lot of things and having a lot of money are 2 things that contradict each other - you need to give money away in order to get stuff.
True wealth and money comes to those who are willing to wait - the 1000 dollars you choose not to spend on a new plasma TV with a giant screen can turn into 100 000 dollars in 20 years. Think of how much TV-s this money would get you then (as opposed to how much you would get when selling your TV after 20 years)
Bad news is good news for media companies - it sells way more than positive stuff.
Writing about negative things can have a positive impact - it makes it more difficult for these things to happen in the future. If a newspaper exposes wide spread corruption it is almost certain that the officials involved will lose their positions.
Giving journalists the freedom to write about whatever they want ensures that in the long run the country they live in will have a better business environment which is good for sustained economic growth.
Reporters Without Borders is a world wide organization that stands for press freedom across the world. They also manage the Worldwide Press Freedom Index that lists the countries of the world by their press freedom.
Top 10 countries with free press in the world
1 - Iceland 2 - Norway 3 - Estonia 4 - Slovakia 5 - Belgium 6 - Finland 7 - Sweden 8 - Denmark 9 - Ireland 10 - Portugal
Other notable countries
Canada - 18th place
Germany - 20th place
United Kingdom - 24th place
USA - 48th place
Russia - 144th place
Map of press freedom
On the freedom of press map below green indicates the countries with highest press freedom and red lowest press freedom
FinancialJesus.com is a true believer of press freedom, so we are very delighted to see Estonia (this is where we run our business) ranking in the 3rd position.
If you are reading FinancialJesus.com, you are probably here because you want to get rich.
Everybody wants to get rich!
Before setting your mind into achieving that first magical million you should have a clear vision what to do with the money once you have it.
If you had a lot of money, what would you use it for?
Could it be possible that you want a lot of money for something that you could probably do with a lot less money and a bit more imagination?
If you need money in order to travel, then you could probably do it with a lot less. If you want money to insure the lives of your children if you were to suddenly die, you could probably just sign up for a life insurance contract.
Take care not to save money for something that you could already afford just by changing your mindset.
Things you only get with enough money
There is a vast amount of stuff you can only do or get when you have enough money. This can include things as different as buying expensive supercars or living of interest that your money generates.
Why do you need money?
Money can be a solution to problems but is it also a solution for your problem? Think.
If you truly believe that you need more money you should write down how much do you need and for what. Money doesn’t have any value just by itself - it is only useful when you can exchange it for something else.
If you have a clear idea of how much money you need in order to exchange it for something of real value, you will also know how much you need. Having goals makes things a lot easier!
I am a big fan of Firefox and use it almost exclusively for all my web surfing.
Firefox was also the only browser that I used when redesigning the theme that this blog comes with.
Here is what I thought FinancialJesus.com looked like to our visitors:
And indeed it looked like this for 75% of all my readers - because they use Firefox.
Here is what FinancialJesus.com looked for the 24% of visitors who used Internet Explorer or Safari:
Notice the magically appeared Google Adsense ad on the right! It was not inserted there by me and until yesterday I had no idea that it was there at all!
Whose ad was it?
The ad was included by the author of my blogs theme. When redesigning the theme I tried to comment out the code for the ad but I did a sloppy job! The ad did not show up in Firefox but it displayed just fine in Internet Explorer.
This was totally against my policy of keeping the site clean and ad free. I have recently added some experimental ads but none of them were above the fold (the part of the website that is visible without scrolling down).
This ad had probably the best CTR on FinancialJesus.com. Unfortunately I have no way of knowing how it did, since it made money to someone else and I don’t have a way to getting my hands on its statistics!
If you want to be sure what your website looks like and you don’t like making money for someone else you should check your website with different browsers.
You never know when something strange (and somewhat stupid) like this happens!
I’ve gone over more than 10 “How to calculate your net worth” guides, only to realize that none of them really give what people want - a good real-life example.
Here is a tutorial on how to calculate your net worth based on my current real life situation. Yes all the “money numbers” in this post are real - they are not made up.
What is Net Worth?
Your Net Worth is basically a sum of money that you will have when you sell all your worldly possessions and pay off all your debts. The bigger the number that you get, the better.
Calculating your net worth can be a good way to bring you down to earth - it only takes into account the things you have already done in your life and doesn’t take into account the fact that in the future your knowledge and education can be major source of wealth.
This keeps things in perspective.
When first calculating their net worth most people are startled to find that they are worth a lot less than they thought. The first time I calculated my net worth I was very surprised to find it negative - I had more debt than valuable assets that I could sell. It was a blow to my ego - I had always thought better of myself.
Basics of Calculating Your Net Worth
Calculating your Net Worth consists of 3 main parts:
Adding together the value of everything you own
Adding together all your debt
Subtracting all your debt from everything you own
Your Net Worth is positive when you can pay off all your debts after selling everything you own.
Your Net Worth is negative when your total amount of debt is greater than the total value of the things you own.
Why Calculate Personal Net Worth?
It is safe to assume that most people calculating their net worth for the first time will find it negative - this is not necessary a bad thing. The goal of calculating your net worth is that it enables you to improve your financial situation.
My Net Worth
Assets
Ownership in companies – $ 1 076 Pension funds – $ 940 Real estate – 0 $ Cars – 0 $ Stocks – $ 571 Cash on hand at the moment – $ 2 179
Things I own
Mobile phone – $ 395
Camcorder – $ 148
Digital camera – $ 30
Laptop – $ 592
All assets combined – $ 5 931
Liabilities
Student loan – $ 4 685
Credit card – $ 66
Laptop payment - $ 316
All liabilities combined - $ 5 067
Net Worth = Assets – Debts
My Net Worth = $ 5 931 - $ 5 067 = 864 dollars
As of June 5th 2008 my net worth is 864 dollars!
Why is my Net Worth like it is?
As you can see above I don’t like buying expensive stuff and I don’t like borrowing. I only take a loan when there is absolutely no other way.
That being said I am not satisfied with my current net value because I feel I should be worth a lot more. But that’s just the emotions talking, not the facts.
The facts are that I own very little and at the same time I owe very little. My assets and liabilities pretty much cancel each other out.
I am more than certain that there are people reading all this that have a lot more assets but at the same time their total net worth is lower than mine (this means that they also have a lot more debt than I have).
Tips on getting started
Different people calculate their net worth differently. As you can see I have included the things I own all the way down to my digital camera that I estimate to be worth only about 30 dollars. Some people don’t include things that are worth less than 500 or 1000 dollars. It would just end up being too complicated and take too much time to complete.
Of course I have things that are more expensive than the things on the list, but I did not include them because they are very difficult to sell.
Two week rule
Coming up with the values of your assets can be tricky. I usually take an educated guess – For how much could I sell this in two weeks? Whatever time frame you choose - stick to it with all your assets. You should only consider doing an exception to costly assets like a house or maybe a car. Expensive things take a little longer to sell.
Check the prices of similar things
If you are not sure about your “educated guess” you should check the local classified ad magazines or the internet for prices of similar things. If you live in the US a good place to start is Craigslist or Ebay.
Don’t exaggerate
Take care to list everything you own with the prices you could really sell them for. While inflating the price of your house on paper can make your net worth look bigger, there is really no benefit in doing so. It might give you a false sense of security and thus do you more harm when you are suddenly in need of selling your assets. If anything it’s a good idea to list your assets as little cheaper than they really are - that way you can be absolutely sure that you can sell them for the price that you have listed.
Should you include the money in your pension plan or a 401K?
Yes you should. While this money might not be accessible to you at the moment it is still YOUR money and on some occasions you can use this money to secure a loan.
I have a house and a mortgage. Do I need to put both of them on my net worth?
Yes. List the price that your house would sell for under assets and the mortgage you still need to pay under liabilities.
If the price of your house is less than the mortgage then it means that after selling it you would need to come up with extra money to pay for your home loan.
If you take a close look of my net worth above you will see that I did exactly the same thing with my laptop that I recommended you do with a house.
I still need to make 316 dollars worth of payments for my laptop (as seen under debt) and I estimate it to be worth about 592 dollars when I would need to sell it right away. That means that after selling my laptop and paying back the debt I would end up with 276 dollars.
Why Everyone Should Calculate Their Net Worth?
A good reason to start calculating your net worth is to increase your financial situation. By calculating it regularly you will have an overview whether your decisions during the last month made you financially better or worse off. Learning from your own mistakes is the surest way to success.
I recommend making the calculating of your net worth a monthly habit. It does magic on making you think about your finances.
If you start thinking about your net worth your chances of multiplying what you already have grow exponentially
If you wish to get more real life information about calculating your net worth be sure to sign up to our full feed RSS or subscribe via email.
If you have questions regarding how to calculate your net worth, leave them in the comments and I am more than happy to answer them and update this article accordingly.
“Money does not smell” was first said by Roman Emperor Vespasian to his son Titus, when he ordered a new tax on public bathrooms (or toilets, as we say here in Europe).
What he probably meant was this:
“If you see an opportunity to make money - use it!
I have written the following story on several of my notebooks and on my calendar.
It is by far the best story about success that I have ever heard.
A young man wanted to know how to be successful
He was sent to a wiseman who made him promise to follow his instructions very carefully.
He agreed and the wiseman took him to a river.
The wiseman asked him to kneel down in the water and submerge his head.
Once under the water, the wiseman grabbed his head so he couldn’t come up for a breath. After the young man failed and fought for a minute, the wiseman released him, threw him up on the bank, and started walking away.
“You crazy old man!! How did THAT teach me how to be successful?!”
The wiseman turned and said:
“You will be successful if you want something as bad as you wanted that breath of air”
Research shows that income rises with happiness, but being too happy can be bad for you.
University of Illinois psychology professor Ed Diener is the author of numerous studies that show the relationships between happiness and money.
Money can’t buy happiness
Ed Diener’s various studies have shown that money can’t buy happiness, but happy people tend to make more money. His studies show that happiness is not the consequence of having more money - just the opposite is true - having more money is the consequence of being happy.
Too much happiness can be a bad thing
In his latest study professor Diener and his team studied the income levels of people who had previously rated their happiness with a score from 1 to 10.
The results were somewhat surprising.
The amount of money a person made grew with their happiness but not all the way to the top level. The 10s (happiest people) made significantly less money than people who rated their happiness with an 8 or 9. The people whose “happy levels” were a bit less than 10 were also more likely to attend college and save money!
Happy people are strivers
Diener’s conclusion was that people who are happy but understand that it is possible to be even more satisfied with their life are strivers (people who rated their happiness with 8 or 9). These people understand that whatever their current situation, it is possible to be better off.
This insight seems to make people tick. They know that there is something to strive for.
Don’t be too happy
The top happy people who rated their happiness level with a 10 were money wise a lot worse off than the people who rated their happiness with an 8 or 9.
The explanation to this is also quite logical.
Tremendously happy people are always happy - whatever happens. If you work in McDonalds and you are happy with it, why look for a better job? If you get fired but you are still happy, why look for a job at all?
Overly happy people make bad decisions
According to a study done in Duke University the people who rate their happiness level with the maximum grade tend to overestimate their lifespan by more than 20 years. They also found that extreme optimists can have problems with controlling their urges - but they are happy with it.
It was found that extreme optimists tended to overspend and accumulate debt. They were happy to take a loan, because they were mistakenly positive that they could pay it back.
One thing I have realized is that whoever you are and whatever you do - there is no escape from money. Everyone has credit cards, bank accounts and even loans.
We deal with money every day
Almost every person on this planet has to deal with money on a daily basis. So why are some people well off and other people not?
It’s because for some people money is an enemy and for others it is a friend.
Money as an Enemy
Money has no feelings. This means that whether money is your friend or enemy is entirely up to you.
The people who have trouble with credit cards and who spend way more than they can afford are not friends with money. In fact - for them money is an enemy. The more money these people have the more problems they will get into.
Make money your friend
If you are one of those people who have constant trouble with money you should take action to make money your friend.
You should understand this
It is not money that controls you, but it is you who has the power to control money.
Changing the relationship between you and money can be the start of your first million.
Take your life into your hands
If you are serious enough and want to get rich, then deciding do become rich is the first and single most important thing that you need to do.
Everything that comes after that is still going to be difficult but it wouldn’t be there if you hadn’t decided to become successful in the first place.
Develop entrepreneurial thinking
Changing the way we think about money can be difficult. A good way to start is to think about the everyday things you do and how much money they will make for someone else.
Example 1
If you drive to work every day and need to pay 1 dollar at the toll booth you can do a fast calculation in your head. Lets say you estimate that 50 cars drive through the toll in a minute. This means that it makes someone $50 in a minute or $3000 an hour. That’s $77 000 a day (minus expenses).
Example 2
Lets say that you have lunch at McDonalds every day (this is America after all ). You can count the number of people in the restaurant, make an estimate about their daily visitors and calculate their approximate daily cash flow. After a little practice you can probably have a pretty educated guess about their profit as well.
These mental calculations can at times be rather far off from what a company is actually making but the more you practice the better you get. Eventually you will be able to spot good money making opportunities in minutes.
Keep your eyes open
Always be on the look out for ideas that you have not seen before. That’s the main reason I like traveling - You get to see a lot of new things that someone is successfully using to make themselves some money. Whenever I see a business like that, I automatically calculate how much it roughly makes! I recommend you do the same.
Here is a short video about the things that make us successful in life. The presenter Richard St. John made observations based on over 500 interviews with successful people.
8 things that make us successful
1. Passion
Do it for love not for the money. The money will always follow when you truly enjoy what you are doing.
2. Work
It’s all hard work. Nothing comes easily. But remember to have fun.
3. Good
Put yourself into something and get damn good at it.
Practice makes perfect.
4. Focus
Success is all about focusing yourself on one thing
5. Push
Push yourself. Physically, mentally. You have to push, push, push. When you are done pushing - push some more!
6. Serve
Serve others something of value - that’s how people really get rich.
7. Ideas
Have ideas and make them come true.
Listen, Observe, Be Curious, Ask Questions, Solve Problems, Make Connections - Ideas will follow.
8. Persist
Persistence is the number one reason that successful people are successful.
This site is about how to make money online, how to reach your wildest goals and dreams and how to succeed in online marketing.
The main topics I talk about are personal finance, online marketing, making money online, success and how to get rich.
). You can count the number of people in the restaurant, make an estimate about their daily visitors and calculate their approximate daily cash flow. After a little practice you can probably have a pretty educated guess about their profit as well.
