...is how you do everything.
Everything you do matters
Harv Eker likes to say: "How you do anything is how you do everything."
At a basic level, your actions determine who you are (or, arguably, who you are determines your actions).
Therefore every little thing you do makes you more like that action
Why so I say this?
Sins - God's Perspective & Man's Perspective
Well, Rebecca and I have been going through catechism at church, and I am learning (or at least more fully understanding) interesting things about sin:
1) We sin pretty much constantly.
2) All sin is equal to God - we have put our own hierarchy on which sins are not too bad or really bad.
For example, not reporting when you are undercharged at Wal-Mart is stealing. So is taking a pen home from work and never bringing it back. So is robbing a bank. In God's eyes, you are stealing in any of these cases.
We tend to make excuses for situations like the first two or think they are "no big deal".
The Little Things Make a Big Difference
So if we want to be people of integrity, we need to demonstrate that everywhere.
If we want to help people, that should start with those we are closest to.
Every little decision you make to take action (or not take action) takes you farther down that path.
I know I have done - in all likelihood - millions of things that I wish I had not (or wish I had in the case of omissions). They did not lead me to become the person I want to be.
For instance, I haven't murdered anyone physically, but I have murdered people in my heart. That is just as bad in God's eyes.
Help!
Unfortunately, it is much easier to see someone else's inconsistent actions than your own. If you are married, you may have noticed that your spouse is painfully good at pointing out some of your faults :)
If you really care about the people you are close to, you can help them out by very gently letting them know if you see them do things that you know are not consistent with the person they want to be - help hold them accountable.
Let me stress that you want to talk about this beforehand with them and make sure they will be receptive to your help :) Otherwise, it call easily come off as overly critical or naggy.
Everything we do makes a difference - let's help each other start acting like it.
Tuesday, November 27, 2007
How you do anything...
Wednesday, November 7, 2007
Costa Rica summary
What I left out of our detailed description of the Costa Rica trip was a summary of our Costa Rica experience and how we feel about having land down there.
What I Liked
1) The natural environment. At our lot, the water has 50% fewer contaminants than Evian. Everything is raised "organically" - just because they don't need to use chemicals, etc. All of the food we tried really tasted great. Costa Rica protects the natural environment so that everyone can enjoy it.
2) The people. Everyone was incredibly friendly. Apparently it is a fairly conservative Catholic country and they even like Americans. Can't get much better than that for international investing.
3) The way of life. Costa Rica is very laid back and family-oriented. I can't think of a better culture to spend time relaxing in (not that I know that many cultures...).
Why We Want to Live There
1) It's Costa Rica! I have yet to meet anyone that visited Costa Rica and did not like it. If you are one of those people, I would love to hear why it wasn't for you.
2) The natural food (and water). See above.
3) Plan B. In case something goes wrong in the states - economically (Social Security crisis, anyone?), socially, politically...who knows. I just like having someplace I can go if necessary.
4) The climate. Although it is slightly humid for my tastes, it is not bad. Anyplace that you can essentially go without heating or air conditioning year-round and still be comfortable is my kind of place!
As with anyplace, it is not perfect - the roads leave a lot to be desired, cars are very expensive because of duties/taxes, etc. I strongly recommend checking it out sometime. We might even have a rental villa that we can give you a deal on :)
To find out more about the properties that we invested in, check out: http://www.best-costa-rica-real-estate.com. Unless you want to spend a lot of time learning the culture and finding someone down there you really trust to help you, I think Ventana del Pacifico is a great place to buy (I suppose that's obvious since we bought property with them).
If you are serious about learning more about Costa Rica real estate, I am also happy to answer any questions I can about travelling down there, etc.
Pura vida! (means "pure life", the unofficial motto of Costa Rica)
Sunday, October 14, 2007
Costa Rica - Day 5 (and 6)
Notice no railings or anything. Presumably the kids around there are quick learners. Even though the crocs are well fed, I think they view everything that comes off the porch as food, so don't fall off!
We also saw a croc over on the bank next to the porch (probably 10 m away) with its jaw hanging straight down. One of the people that lived there tried to explain to us that his jaw was broken, probably in a fight with another croc (our driver helpfully interpreted for us). Nothing kept the crocs from coming up the bank and onto the concrete porch from the side, either. Again, don't think I would really want to live there...
We had a good show, so we gave the owners $5 when we left, and headed on our merry way to the airport, glad to have had a very interesting experience!
Palmar Sur
We got to the "airport" in plenty of time and were just waiting for the flight to get there. We were supposed to be there by 10:00 in case of an on-time 10:30 departure. I think we got there about 9:40.
While we were waiting, I noticed a starfruit tree between the covered waiting area and the runway (it was just to the right and a little behind the 2 boys in the picture). There were a lot of fruits on the ground and on the tree, so it was clear to me that noone was harvesting them regularly, so I went over and picked a ripe fruit and starting munching on it. Did I mention I love Costa Rica?!
Patrick (from the developer's office) was on our flight (the only one to San Jose each day), and told us after he got there that the plane had left San Jose around 10:00 and should be there around 10:40, which was closer to on-time then usual, apparently.
After a while, the ticket lady was explaining a situation to me in Spanish. What I got out of her explanation was that the flight had been cancelled because of something.
After talking to Patrick, we learned that a plane had crashed at the end of the runway. (The pilot was fine - he walked away - it looked like the plane had just tipped over on the side of the runway, I am guessing on takeoff.) The airport would therefore be closed to all flights for the rest of the day as the civil aviation authority came down to investigate.
"So what do we do?" we asked Patrick. Patrick advised that he was trying to charter a plane at a nearby gravel airstrip because he had a 1:30 flight to catch out of San Jose to Canada for meetings. He said that we could hitch a ride with him, and he didn't want any money.
Well, after about 15 minutes, it was clear that he was not going to be able to get a plane. So he was going to head home to try and rearrange his flight schedule. Since our flight was the next day, Patrick said we could take a taxi - it would take about 4 hours. He asked a local taxi driver how much it would cost to go to San Jose and Patrick translated $200. Since the airfare was $172 (which should be refunded), that was not too bad.
To San Jose via Taxi
So Patrick hitched a ride with us back to the guest house, and we headed off down the road at about 10:45 to San Jose. Patrick had advised us that we had essentially rented the taxi driver for the day, so we should feel free to stop for a restroom or restaurant break as frequently as we needed to. Once we got on the road, we decided that we just wanted to get there, then we could have an early dinner there.
Although the speed limit on the coastal highway was typically 80 km/h (50 mph, though people would often go 100 km/h), on the roads through the mountains - the vast majority of the trip - the speed limit is usually 50 km/h.
Our driver would regularly exceed the speed limits, and in his high-centered Toyota Hilux 4x4 crew cab, we moved around a lot. We learned that our abs were somewhat sore from our zip line adventure yesterday, and the bracing was giving them an additional workout.
We were making decent time until Cartago (about 20 km from San Jose). Traffic was stuck there, and I don't think our driver knew the area very well. He made a couple of calls, got out of the traffic, drove around for a bit, then ended up in the same line of traffic except like a mile farther back.
He stopped to ask a pedestrian, and it sounded like traffic was not moving AT ALL, nor did it look like it was going to. Then he talked to another driver, and followed him out of traffic and into neighborhoods. Eventually we made if to where a bunch of people were gathered and as we drove across the bridge, we saw A LOT of muddy water flowing very rapidly (picture isn't great, but hopefully you get the idea).
I think the flooding was why traffic was not moving and would probably not be moving anytime soon.
After stopping to ask several more drivers, we ended up on backroads through industrial areas and back out into the country, then got to a small town up in the hills. We took a right, and all of the sudden we were on this really nice paved road.
This wound through the hills around the back side of San Jose. To make a long story short - after stopping to ask around 20 people total, we finally made it back into San Jose and back to our hotel. We got there at 4:45, so it ended up being about a 6 hour trip (apparently the detour took about 2 hours).
People were very helpful in providing directions - not one person that he tried to stop refused to help (try stopping random people in the US for directions). It may have helped that the taxi "badge" on the truck had the Osa province on there, so people may have noticed that he was a long ways from home.
When we got there, he told us how much it was - I thought $210, but when he wrote it out (good idea he had there!), it was $220. Well, since we had not planned on paying for our return trip with cash, we were not absolutely positive we had enough. (We could have always had him take us to an ATM if necessary.)
ASIDE: This is a good place to mention that you really don't need to change your US dollars to Costa Rican colones if you visit Costa Rica. I believe everyplace will accept US dollars. Maybe sometimes you don't get the best exchange rate, but at worst you take a 3-4% hit - most credit cards charge 3% now for foreign currency conversion. We did take a lot of smaller bills, though (Pat - thanks for that advice), because you get your change back in colones. If you give them a $20 for something that costs $5, you get $15 back in colones, which can be inconvenient.
We had a lot of $1 bills left (that explains why), so picture us standing at the back of his truck counting out all of these ones (in piles of 10) to pay this $220 bill. I think we paid about $60 or $70 in ones, the rest were larger bills, thankfully. And we ended up with $22 left over!
We felt really bad for our taxi driver because he still had a 4-6 hour trip ahead of him, mostly in the dark since it would be dark around 6. I would NOT want to do that drive in the dark (not really in the daylight either, but definitely not at night). I guess he made some pretty good money for the day, though.
We got settled in our hotel and walked down to Antonio's Italian Restaurant, which was highly recommended by the hotel clerk (Fernando) as a nice place to eat. It was VERY good food, although it was a little funny to have the Costa Rican staff serving Italian food. Very good and authentic, though. Then we came home and went into a food induced coma in order to get up for our early flight in the morning (the cab is coming at 4:30 am).
Costa Rica - Day 6
Not much to report here. I liked this sign in one of the shops. Apparently ED knows no borders.
We wanted to get some duty free stuff at the airport - coffee for family and us, and at least some sort of Costa Rican liquor (my idea). The Cafe Britt stuff that they had at the airport was really good. They had lots of different varieties - it wasn't all that cheap as far as coffee goes (they had a 8 12-oz bags for $39 special), but it is EXCELLENT.
As far as I can tell, Costa Rica only exports two types of liquor - rum and coffee liqueur. So I got some of each for good measure. (On the US side of customs where we were packing the liquor into our checked bags, we ran into a guy that brings an extra cooler with him going down in order to pack everything in coming back. He recommended using the coffee as padding for the liquor. He seemed to be pretty good at this...)
Rebecca was thrilled to be back in Kansas City, as you can tell by this photo.
Thursday, October 11, 2007
Costa Rica - Day 4
Morning at the Hotel
Today we certainly did more activities than any other day in Costa Rica. We got up early to start a walk around the hotel's rainforest path (about 1.25 mi) at 6 am. Although they had guided tours available, Rebecca doesn't really like guides (goes along with her general aversion to people she doesn't know), so we just did it on our own.We did not see any wildlife (except for the huge spider and web outside of the rainforest), but really enjoyed just walking around in the rainforest. In retrospect, I think it may have been good to have a guide because they know where to look for animals, but there just may not have been many out because of the rainy season.
We got back to the hotel about 6:45a, and since breakfast did not start until 7a, we decided to hop in the pool to refresh ourselves before showering and heading down for breakfast.
The complimentary breakfast was awesome - I especially enjoyed the fresh fruit. That has to be one of my favorite things about Costa Rica - that fact that (almost) all of the food is extremely fresh. They use a few packaged things (like flour, sugar, etc) but not nearly as much as we do in the states.
Design Meeting
After breakfast we had a meeting with the Ventana del Pacifico house designer. (As you can tell, we really planned on buying property as we already had a meeting set up with the house designer.) We had been told by someone else that had bought property (but not yet started the design process) that you had to have one meeting with the designer on site and the rest could be handled remotely.
The meeting took less than an hour (Patrick had told us this yesterday, and the short time surprised us), and the purpose was to 1) know which lot they were designing for, and 2) understand what we (the owner) wanted in a house.
We gave him some details, but mainly general ideas of what we wanted in a house - mainly a lot of outdoor (still under roof) space with a very open feel. I don't want to bore you with details, so we will leave it at that.
He did say this was going to be fun - he really hates ones where the people already have an exact floorplan picked out that does not really take advantage of the lot. Especially as most floorplans are designed for flat lots, and very few Costa Rican lots are flat.
We realized that we could have done this meeting remotely, but I feel that there is real benefit in a face-to-face meeting so that the designer understands the owner as much as possible (and vice versa). We look forward to getting the first draft of the design in about a month!
Hacienda Baru
After another light lunch (and a small nap), we prepared to go on a canopy tour at Hacienda Baru. We had scheduled a time the day before - the tour cost $35 per person (I thought that was fair for 2 hours hiking through the rainforest and sliding around on zip lines), but the taxi cost $50 there and back.
A very worthwhile trip - because it was the beginning of October (a month when then tourist industry is almost shut-down in southern Costa Rica), we were the only 2 on the tour. We saw bats, a couple of 2-toed sloths, a 3-toed sloth, a poison dart frog, a couple of toucans, and lots of leaf-cutter ants.While we weren't way up in the trees usually (the exception being on one platform 120 ft above the ground) the zip lines across a valley were really an incredible experience. For some it wouldn't have been that exciting, but we really enjoyed it.
And the weather was beautiful - usually it rains in the afternoon in the rainy season, but it was actually cloudy all morning (with a little rain) and the sun came out for a beautiful afternoon.
We came back to the hotel after that, hopped in the pool for a bit, then showered and relaxed before dinner. Mmmm....dinner...
Wednesday, October 10, 2007
Costa Rica - Day 3
They started maintenance on the guest house today (the workers looked eager for us to leave so that they could tear things apart). This picture of the shrubbery trimming is telling - the top 2/3 that they are cutting off is a year's worth of growth (probably with some trimming along the way). They will use a lot of the cuttings (with leaves cut off) for stakes and fencing - if they stick them in the ground, they will grow, as we noticed several stakes growing as we were looking at properties!
We just relaxed the rest of the day - hung out by the pool for most of the morning, had a couple of nutrition bars for lunch since we had such a large breakfast at the guest house, then napped a bit in the afternoon.
Saturday, October 6, 2007
Costa Rica - Day 2
- Estates - generally more ocean views and more expensive. You can build house up to 3 stories tall here.
- Rutchailo Verde (aka NWA-A named after the seminar they sold our packages at) - generally flatter, mostly in a valley, and less expensive - more of a neighborhood feel.
- El Chiverre (aka NWA-D) - terrain more similar to the estates, but more mountain views and generally cheaper prices.
It was quite an adventure looking at lots, especially since I am from mainly flat areas of the U.S. In order to get from the road to the place on the lot where the best view is, you usually have to go either up or down. The slope is usually good and the wet foliage on top (anywhere from one to 3 feet tall) adds to the challenge and the adventure.
We were warned ahead of time and had brought long pants and closed-toed shoes and socks. We also borrowed Don's organic bug repellent for our ankles. (I don't know if it was the bug repellent or intermittent rain, but I ended the day with no noticeable bites.)
We had a smaller group than normal (8 vs. 14) since we were the last group of the year before the guest house shut down for 3 weeks during the height of the rainy season. This allowed us to all get into one vehicle instead of the normal two.
I think we were the most serious buyers there (Nate came down to get the same deal we got, but knew he would probably not be buying this trip), and it showed looking at lots. We were the ones saying "can you stop here?" or "we want to look at a couple of lots up here."
We certainly got our exercise for the day by lunchtime. Speaking of lunch - did I ever mention that my life is very food-centric? - I am always looking forward to the next meal. Lunch consisted of a good variety of food - baked pork pieces (I don't remember the name), and various other things I can't remember right now. It was all very good, though.
In the afternoon, Don took us down to the beach (Playa Ventanas) - wow! what a beautiful area. The coconut trees grow up to the beach (as does a nice carpet of grass-like ground cover) and the coconuts they drop start to grow new trees.
As 96% of the coastline in Costa Rica is public access (as are all of the waterways), you can just go down to the beach and grab a coconut tree "seedling" to plant at home.
Which brings me to another very important point - the soil in Costa Rica is so fertile that you can drop just about any seed on the ground and it will grow (the only exception is if the plant needs actual "seasons"). This makes it critical to choose what you want growing and keep other things out. We plan to have various fruit trees on our property - starfruits, mangoes, papaya, banana, coconut, and any others that catch our fancy between now and then.
So the beach was nice - amazing views as well as a couple of caves that actually go all the way through a small jungle peninsula. It was mid-tide when we were there, so you couldn't walk all the way through the caves - OK, maybe you could, but the waves were getting quite turbulent in there, so noone was willing to risk it :)
After being there for a while and having some extra time, Don asked us if we wanted to go see a neat waterfall that is not on the normal "tour". Of course, everyone said yes, and off we went.
Apparently the waterfall is on property that used to belong to the developer. Fortunately for us, waterways have public access, so we ccould still visit it. Because of recent rains, the water was really moving (and cold), so we couldn't go as far into the pool as normal, but we enjoyed the natural beauty and got a nice picture of Rebecca, Nate, and I in the pool.
Afterwards we attempted to ruin our dinner at a local tilapia farm where we went fishing, then ate. OK, "fishing" may be a stretch - they put bait on the end of a line attached to a handle for you and you throw it in to the pool they are growing the tilapia in - needless to say it does not take long to catch one.
The appetizers (bocas) we had were a salad, flattened and fried plantain slices (can't remember the name), and fried fish. The fried fish is slightly different than you would see in the states - they still gut the fish, but then they chop it in cross-sections (instead of fillets) and fry everything but the head. So skin, fins, and tail is still on the fish. Don said we had to try a tail or fin as they were like potato chips - he was surprisingly correct.
Rebecca doesn't eat seafood (at least nothing that tastes fishy, which really leaves only lobster), so I was surprised when she tried the fish. I was even more surprised when she liked it - it did not have a fishy flavor because it was fresh - just a few minutes (or maybe hours) from catch.
Apparently the ceviche available in the roadside stands is very similar - they catch the fish (usually Maui Maui) in the morning, make ceviche in the morning, sell it all day, then use any remainder for bait the next day. (If you don't know, ceviche is another boca consisting of chopped up fish that is "cooked" in lime/lemon juice along with cilantro, onion and perhaps other seasonings. It is not heated but the strong citrus juices sort of pickle it, I guess. Rebecca's brother loves it, but it is hard to find in Kansas City because of the general lack of fresh seafood.)
So we demolished the three appetizers, then headed back to the guest house for dinner (after I took a nice dip in the pool). Again, I don't remember exactly what we had for dinner, but it was good! I do remember the bananas foster for dessert, though, which was great even without ice cream.
Nate, Rebecca, and I played a little bit of pool, we grabbed pictures off of his camera (since we forgot ours in the afternoon), and then Rebecca and I spent time deciding which lot(s) we wanted.
We still didn't have complete understanding of the package we bought for $1500 (we were to get it clarified in the morning), so we came up with two options: 1) if we did not have a price freeze on land until 2010, then we would just get a couple of lots and put off building, or 2) if we did have a price freeze on land, then we would get one lot and start the desin process for our custom house.
Our top two lots were (drumroll please...):
- NWA-D, lot 37 - over 1/2 an acre and backs up to a river area. This provides the "down in the jungle" feel that we want (and it is cheaper since it is not an ocean view).
- NWA-D, lot 7o - this lot was more expensive, but potentially provided mountain views in 2 directions (from the top of a ridge). It also had the slope most of the way down into a valley to get a little of that "in the jungle" feel.
Tune in tomorrow to see what happens!
Friday, October 5, 2007
Costa Rica - Day 1
This was what we woke up to our first full day in Costa Rica - for being the middle of the rainy season, it sure was a beautiful day!
I have been on small planes in the states, but this was by far the smallest "passenger plane" I have ever been on. That is Rebecca and me in the picture with the only other person on our flight in the background. (He apparently is a Costa Rican - a "tico" as they proudly call themselves - and he tried to bring his new chainsaw on the plane with him. I was glad that they did not allow him to carry it on (or even check it), and I had more confidence in the air safety of Costa Rica after that.)
We stayed at the property developer's guest house - next door to their house - about 900 ft above sea level (though it was only about 10 minutes to the beach, even on bad roads). Their older developments were in that general area, while the newer developments where lots are now for sale are about 15 minutes closer to Palmar Sur and where the new international airport will be going in.
Many of the lots were also on hillsides for views, which made it convenient to design with several stories (some lots are limited to 1-story construction on the front side in order to preserve views for others).
Costa Rica - Day 0
Well, we just got back from Costa Rica - what a trip! Instead of trying to sum up everything in one huge post (because there is a lot!), I decided to summarize the trip by days to provide logical divisions and see it unfold from our perspective. (I would have liked to do this every day, but I did not have internet access, and I was not forward-thinking enough to just do it in Word.)
Without further ado...
Day 0
We flew from Kansas City to San Jose, Costa Rica today (September 28, 2007). I travelled with my wife Rebecca and our good friend Nate. Got to watch a couple of movies on the plane, which was a pleasant surprise (Surf's Up and Evan Almighty). By the time we got in - about 9 pm - it was dark, but temperature was still very pleasant (apparently it had been raining in the afternoon).
Rebecca and I had Chipotle (mmm...Chipotle) for lunch and a "dinner" on the plane, so we weren't very hungry, but we shared a delicious ginger/lemon grass flan (more like sweetened butter - quite good but filling) while Nate had a cheeseburger at the hotel restaurant. (I couldn't believe Nate got a cheeseburger at a restaurant in Costa Rica :) )
Thursday, September 20, 2007
Focus
Wow - I can't believe it has been over a month since I posted. My apologies to everyone.
This post is about a topic I have sort of known the importance of for a long time, but I am just recently realizing how important FOCUS is to achieving success (and in a timely fashion).
Successful People
Successful people have focus. They have a drive that keeps them focused on a specific business or dream, and many of them keep pushing that business long after they are successful.
Look at people like Michael Dell and Warren Buffett. I often wondered why you would not "cash out" once you were already a billionaire - why keep working when you have that much money? Because they are focused - the have drive and passion for the business and it is not just about money.
Buffett turned over about $30 billion to the Gates Foundation to distribute because he wanted to stay focused on running Berkshire Hathaway. That's what I call focus - turning over almost all of your wealth to someone else for charitable distribution while you continue to do what made you the money in the first place.
How to Use Focus in Your Life
I don't know where you are in your life, but focus is extremely important. As I began to undertake ventures outside of my regular job, I began focused, but then saw more and more opportunities and therefore lost focus.
In retrospect, I know exactly what I should have done: put all of my energy outside my job into only ONE venture - both physical energy as well as the focused thought to really make my physical energy produce great results.
Put energy into one venture until it is self-sustaining then decide whether to continue to focus on its growth or make it a passive business (or sell it off). Then you can start a new venture once you have been successful with one.
People with several successful businesses did not grow them all at the same time. They focused on one at a time, then moved on to the next.
How Focus Helps
I have only recently begun to realize the power of focus - ironically it is at a time when I am not focused on anything.
From simple-ology (see a future post - I promise less than a month :) ) we know that the quickest way to get what you want is a straight line (i.e. go straight to your goal).
If you have multiple goals at once, you cannot go in a straight line to all of them at the same time, so you end up wandering around, hopefully eventually hitting one or more of your goals.
But if you have multiple goals at once, in addition to all of the basic things of life that have to get done, your "to do list" can quickly become overwhelming. Your brain gets overwhelmed and either gives up or makes you extremely stressed out, both of which provide serious barriers to progress.
Enter FOCUS: by focusing on one goal at a time, you put all of your energy into one activity. Not only does your brain like focused activity much better, but you also feel much more rewarded as you are always making progress towards an identified goal.
My Focus
So right now I am focused on figuring out God's purpose for my life to ensure that my focus is consistent with His purpose.
See I believe that God has given us certain abilities and passions in order to accomplish certain things in this world. Each of us has different gifts, and I believe that we were meant to use those gifts for His purposes and enjoy our "work" using those gifts.
I do not believe that we were meant to do work we don't like or be content with dead-end jobs. We are to use our gifts to accomplish things we are passionate about. "Work" is intended to be satifsfying, not meaningless.
I know that I have been blessed with some wonderful innate abilities (as have you), and I want to maximize my use of those to God's purpose in the world.
P.S. I will let you know when I have it all figured out :)
Monday, August 13, 2007
Other Passive Income Blogs
Never one to hoard all of the glory for myself (at least I like to think I am getting better at this), I want to share some of the other good passive income blogs I have found, along with my comments on them:
Blogs (in no particular order):
1) http://www.geniustypes.com - great blog on trying to develop passive income (further proof that I'll never figure out search engines - comes up #2 in Google on "passive income" but #11 on "passive income blog")
2) http://www.theroadtoperfection.com/ - although not many new posts will be added, this is an interesting story of a college student getting very close to financial freedom - Jeremy and I keep in touch to keep each other motivated and welcome others to help
3) http://www.netpassiveincome.com/ - great site for online passive income development, especially blog related!
4) http://income-opportunities.blogspot.com/ - depite the similar website name, we are not related :) Apparently Malathy is in India, but that doesn't keep him from highlighting some interesting opportunities.
5) http://www.kchut.com/ - mostly online oriented, again, not necessarily passive (but most online ventures lend themselves to being passive - except blogging, of course, unless you can get other people to blog for you...)
I will highlight more as I run across them. The beautiful thing about the current internet is the ease with which you can find people that share your interests.
We need to get a passive income mastermind group together... (for any literary types the "..." is my version of foreshadowing)
Speaking of groups with similar interests - Anyone ever played Kiyosaki's Cashflow 101 board game? Great game that really helps develop some passive income knowledge and strategy. If anyone in the central Kansas area ever wants to play - let me know!
Friday, August 10, 2007
Amazon Context Links
So Amazon has an affiliate program where you get paid if people buy stuff from Amazon by linking from your site.
SIDEBAR
From a moneymaking standpoint, Amazon is not that great because it only pays 4% to start up to 10% based upon your volume of business - but when I have checked Amazon always has the lowest prices, so I strongly recommend them as a place to buy books, especially when you get free shipping on orders over $25!
They recently (I assume - it's in beta) rolled out a new application (or "app" to use the "lingo") that scours your text for search terms and makes those words "live" where you get a preview if you hold your mouse over it and can click it to go to Amazon to buy.
e.g. if I wrote "Harry Potter and the Goblet of Fire", this should become an active link to Amazon where if you hold your cursor over it, you will get a preview of the item, which you can then click on to go to Amazon.
I think this is really cool (putting on my "old man hat" for a minute) - it's incredible what that there technology can do these days. Seriously, I do think it is cool, and given my experience with Amazon being very cheap, the idea seems really cool, if it works.
After some trial and error (and consulting the all-knowing Google oracle), I figured out how to incorporate this into Blogger.
Please give me feedback on these context links:
1) Do you like them or not like them?
and of course,
2) Let me know if they are not working for you!
Thanks for your help!
Thursday, August 9, 2007
Costa Rica Update
This has been a long time coming because I have more details on Costa Rica. (For those of you that didn't see the "formal" site before or just want a refresher - I love the pictures - check out: http://www.best-costa-rica-real-estate.com/).
Rebecca and I are headed down to the Costa Rica development September 29/30. (We will probably spend a few extra days in Costa Rica truly vacationing as well.) We are awaiting approval on the mortgage to finalize our plans - we hope to have that by next Wednesday.
The mortgages are done just like any other mortgages in the United States or Canada with somewhat higher interest rates (8.25% and up), but typical 30-year rates, up to 90 or 100% financing. There does appear to be a 3% origination fee, however. Overall, a very good program (so I've heard) compared to others for international investing. Since I've not done other international investing, I can't speak from my own experience on that one :)
If and when you come down with us, you have the opportunity to purchase the same "option package" that we did. I am slightly jealous (and extremely happy) that anyone that comes down can get the same package I did (recall that I changed plans and attended a seminar in Orlando just to get this deal). It costs $1495 USD.
This is what you get:
1) Price-freeze on lot/house (combination) until June 20, 2010 (about the time the international airport 20 minutes away goes into service).
2) Referral program - you make 3% commission on anyone you refer that purchases property and 2% commission on anyone THEY refer. (Kinda sounds like network marketing, huh?) With the average purchase being around $300,000 USD, a referral would be worth about $9,000, which would pay for this package and several trips down to CR.
3) $1500 travel voucher if you purchase a property. (i.e. if you buy something, you get this package FREE)
4) Reduced property management rates (I am checking on whether it is 10% or 20% to manage your property as a vacation rental - typically these rates are around 40% if you have looked into this in the states).
5) Millionaire mentoring - webinars with Ed Mercer (the owner of the development). In addition to being very successful, Ed is of the highest integrity, cares so much for other people, and just radiates positive attitude - a great combination in anyone, especially a future neighbor.
They will never offer this package again (they offered a similar package at a recent seminar, but as I understand it did not have a price freeze until June 2010 and had 20% property management fee instead of 10%).
Again, if this sounds interesting to you, let me know ASAP as we will be making travel plans in the next week or two. I am checking to see if this would be available for future trips down to CR, but frankly, I feel very lucky that they are even offering it for one trip.
Friday, August 3, 2007
Commercial building downtown
I haven't written anything for awhile. That either means nothing interesting has been happening or I have been so busy that I haven't had time to write. I think a bit of both...
Rebecca (my wife) and I went and looked at a commercial property for sale downtown yesterday. Now it is downtown retail space which I normally wouldn't have much interest in except that it has 2 upstairs apartments as well, and boy are they cool!
The property is listed at $99K. The two upstairs units rent right now for $350/mo each, but they are much larger (and cooler!) than the apartments in our 4-plex that we have rented for $400/mo each. We think without doing anything, we could raise the rents to at least $950/month total.
These apartments have hardwood floors, lots of brick (in the larger one especially), I would guess 12-foot ceilings through most of it, and dining rooms! The larger one even has a beautiful wood staircase up to a "penthouse" room on the roof. From the outside it looks like someone plopped a small house on top of the roof. The penthouse has hardwood floors, a baseboard heater (window A/C could be added, I think), and access to the roof, where there is plenty of space to hang out, BBQ, watch fireworks, etc.
Needless to say, I like the apartments, but I am not going to get all emotional and do something stupid! (at least I hope not!)
The retail space could potentially lease for about $800/month. There is also a 2500 ft^2 concrete basement under this the building with tons of shelves. Great to storage - either for the retail lessee (you know, the person that leases the space - I just know that term because I looked at a lease today) or someone else that needs storage.
Right now, the apartments are occupied (no surprise at $350/mo) but the retail space is not.
Where it gets tricky (for me) is the fact that it is commercial property. A loan on commercial property will be at higher rates (typically around prime with a small bank, currently 8.25%) than residential (where even for investment property we might be looking at 6.5-7.5%). They also typically want a lot of down payment. Oh, and interest rates adjust to the index rate every 3-5 years (so it is not a fixed rate). And terms are generally not as long (20-25 years).
We don't have a lot of money laying around right now (really not any with our upcoming Costa Rica purchase), so the down payment becomes a little tricky. Also, if we are looking at 8.25% with a 20-year term, we might just be break-even on cash flow even with a renter in the retail space.
There are also several repairs that need to be made. Nothing too major, but probably $5-10K (up to $30K if you wanted to make it really nice). Factoring all that in makes it less of a slam dunk than I first thought.
I think it could be a very good property, though (at the right price). I will keep you informed as to what happens!
Sunday, July 29, 2007
Passive Income
Although this blog centers around passive income and its usefulness in providing financial freedom (see previous post for definition of FF), I don't think I really did a good job of defining passive income.
This is a fundamentally important concept, so I want to spend a post on it.
Definition
Passive income is income received while you do nothing.
Passive income is typically either investment income or income from PASSIVE businesses. By passive businesses, I mean one in which you can completely walk away from for a year and it will be making more money than when you left. (Hint - it still requires someone to be minding the business, it just doesn't have to be you!)
There are VERY few truly passive income investments (usually you are doing at least a little bit of decision making - e.g. whether to buy a certain mutual fund or stock), but I use the term for any income where you can either set it up and forget about it or you have the ability to highly leverage your time using: (1) systems, (2) other people or (3) assets (money or other assets).
Passive Income Example
As an example, let's look at the credit card tradelines I previously discussed.
The money I make from authorized users (usually about $100 for 5 minutes worth of work) - good compensation for the time as I am leveraging an asset (good credit), but not passive income.
I also get paid a fixed fee for referrals - not quite as good a compensation for the time as I am not leveraging anything.
Finally, I get a % of earnings from the referrals as long as they are earning money - THAT is passive income. Once I get referrals set up, I continue to earn and collect income without doing anything (except cashing the check - whoops, direct deposit has even eliminated that "hassle").
Passive income and THE BLOG
Now in this blog, I will discuss a lot of activities that are not truly passive, but at the very least I will try my hardest to avoid trading time for money (where you are compensated by the hour, month, whatever).
Some will have more involvement from me than desired (at least initially), but the hope from each is to be able to either turn it into completely passive income or produce great compensation for the time involved in order to invest that money in other investments or businesses that produce passive income.
I hope you will see the same usefulness in each of these opportunities. I realize that everything that I try (or even hear about) is not going to appeal to you, but my hope is that this blog provides you a "smorgasbord" of opportunities from which you can pick and choose.
Friday, July 27, 2007
Making money with your good credit
Many of you have now heard of this - it has gotten a lot of press recently, but I got involved with this back in April, before most people had heard about it.
The subject is "seasoned tradelines" or "piggybacking" - companies help people improve their credit (for a fee of course) by adding them as authorized users on credit cards of people that have good credit. This improves the credit of the new authorized users and does not affect the credit of the primary cardholder.
The company helping people improve their credit gets paid for playing "matchmaker" (and their knowledge and expertise of how to best improve someone's credit). The get paid by the person with bad credit and pay part of that to the person with good credit in order to use their authorized user spot.
The Industry
The recent press on the subject has stimulated demand (from people with bad credit) as well as supply (of people with good credit). I am worried that there are a number of questionable companies out there taking advantage of the situation - possibly outright fraud, but more likely charging large amount for questionable results.
The industry does not have storefronts - most companies are a handful or less of employees (probably located all over the U.S.) and then additional independent contractors acting as remote agents. Everything can be handled over the phone or electronically, so it is very important to make sure you are working with a company that is not going to disappear into the night.
The Criteria
In order to be able to sell authorized user spots, you have to have credit scores of 700 or better. You also have to have "qualifying" cards: preferably at least 2 years old, at least $5,000 credit line, perfect payment history, and keep balances below 20% of the credit line.
And only certain cards report the authorized users. As examples Citibank, Bank of America, and American Express are best, Washington Mutual also works, but Chase does not work.
Any decent company will have to pull your credit before being able to quote you rates they will pay for authorized user spots. Rates typically range from $50-$150 per spot (I most often see $80-100), and number of authorized users per card ranges from 2 to 10.
I believe most companies pay after the cards report (the only way they can verify you added an authorized user) at 30-45 days after adding the person, then remove the person at 90 days (after having enough time to positively impact their credit). If anyplace promises a better time frame than that, then are probably doing the person trying to improve their credit a disservice.
Citibank and Bank of America cards allow 9-10 authorized users, so if you have several of these cards, you can rake in a decent amount - $2,000-$5,000 every 3 month is not unreasonable.
Is it Safe?
One of the main questions people ask is can these authorized users actually make charges on the account? The answer is no. When you add authorized users to your account (typically online), the company sends a card to you (they don't even have an address for the authorized user). Because you have the card, they never have enough information to be able to use a
In addition, they cannot call up the credit card company to make changes because the card company has security measures (often your mother's maiden name and your social security number) to prevent others from accessing your account.
In the 3 years that Seasoned Tradelines has been doing this with thousands and thousands of authorized users, they have never had an incident with any of the primary users' cards.
The Company I Chose
When I was looking back in April, I chose to work with Seasoned Tradelines because they have been around longer than the others I saw (since 2004), they responded promptly, had a referral program (to make extra money), paid the same as other companies, and I now know that they are also working on other ways to use your credit to make money without much work.
I also saw some contracts from other companies that had a non-compete agreement for years after working with them, and I knew I did not want that.
Once this concept started getting a lot of press and Seasoned Tradelines started getting overwhelmed with calls, I was offered what I considered to be a great opportunity. They said if I would call people back and answer questions, I would get the referral fees for anyone who decided to come on board.
Upcoming Changes?
Now FICO is threatening to change how authorized users get reported (presumably removing the benefit that authorized users can now get). My understanding is that they are going to start with one credit reporting agency in September and then do the same thing with the other two agencies over the next year.
I am still not convinced that this will happen in September (there are a lot of people - in this industry and outside it - that are very opposed to these changes). Even if it does, it will happen slowly, and I like the fact that Seasoned Tradelines has other ways to help people improve their credit and let people with good credit use it to make money.
How to Participate
If you are interested in participating yourself and believe you meet the criteria discussed above, you can give me a call (cell - 816-896-6566) or email (sfweller@yahoo.com). As I said, I work as a remote agent for the company, and my job is getting people's information so that we can provide a proposal based upon the specific cards you have.
It usually takes a day (or two) to get a proposal, then you just fax back the paperwork if you are interested. From there, you slowly get requests to add people to your cards and ultimately make money!
Like I said, they also have several other ways of making money with good credit that they are working on, so even if you don't have many (or any) qualifying cards right now, it is good to get your name on their list for future opportunities.
PS - If you want to improve your credit, I just need your name and phone number to have someone from the company who is knowledgeable about that side of things get in touch with you.
Thursday, July 26, 2007
My first network marketing adventure - Part 2
So we needed to figure out how to get more customers or bigger customers.
We looked at what our sponsor did - a number of shows every year. You know, tradeshows, where vendors pay to have a booth and people pay (generally) to get in, and the only people guaranteed to make money are the ones putting on the show.
Well after a few tries (OK, probably 5 or 6), we got fairly good at converting shows into customers, but those customers would not always make that first order. We found that once customers made the first order, they generally stayed around for quite awhile because most people really like the products
We also got a few accounts (places that did oil changes or sold oil products) both through the shows and by just calling on local businesses. These accounts made a difference to the bottom line faster just because AMSOIL pays better (initially) for these type of accounts.
So we plugged away, doing 5-10 shows per year, spending some very long hours at some of those shows. (I especially remember the 10 straight days of 12-13 hour days at the Kansas State Fair.) We eventually determined that our effort was perhaps not yielding the rewards we were looking for, and we began to look for other opportunities (especially my business partner).
At the end of the day, we also realized that an LLC was not the greatest structure for a network marketing business, we split up the customer base (which was already largely done anyway), and we went our separate ways.
I still love AMSOIL products but I really don't market them aggressively. My wife's car is still covered in AMSOIL propaganda, but only because I am too lazy to try and take everything off.
Our checks now run $100-$350/month on an average of an hour or so of work. Nothing to set the world on fire, but the money on top of a great learning experience has been very nice.
Let me summarize some of the key points of my first network marketing business:
What I love about AMSOIL1) Fantastic products
2) Reasonably priced (much more benefit than other synthetic oils for just a little bit more)
3) Once customers start using AMSOIL, they keep using AMSOIL (goes back to #1 & 2)
4) Ability to earn money a lot of different ways (different account types, etc)
What I don't like as much about AMSOIL
1) The compensation is not competitive with other network marketing companies. Most of this stems from prices being too low - seriously, prices per quart of oil are only slightly higher than they were in the 1970s. People generally don't buy AMSOIL because of the low price, but AMSOIL (corporate) thinks they do. This does not leave enough compensation for dealers to make it competitive with other network marketing compensation plans.
2) AMSOIL is somewhat embarrassed to be a network marketing company. I don't know why this is, but they push direct sales to accounts rather than sponsoring other dealers into the bsuiness. I understand there is some stigma associated with network marketing, but you ought to embrace it if that is your distribution method.
3) Oil is complicated! Unlike other products (like nutritional juices, for example) where there are only one or two options, for synthetic oil and filters you have to look up the vehicle type in order to select from several different grades of oil and many different filter types. This is not convenient for either the dealer or the customers. The dealer has to be an expert, which hurts the duplicatability (is that a word?) of the business - and duplication is the foundation of network marketing (of course, see #2 above).
Lessons from my first Network Marketing Experience
1) Have products that you love! It is no fun learning about products and talking to people about their applications if you have no interest in the product itself. People also buy based upon emotion and justify with logic, so the emotions you convey are supremely important.
2) Have products that people buy more than once a year! There are a number of reasons for this. It is good to have relatively frequent contact with your customers. It is
3) Have higher-end products available for your best customers. Most businesses have more expensive, more profitable products for those customers who want the best or just more. With AMSOIL, that is very limited - there is better oil that costs $2/quart more retail or there is transmission fluid, grease, etc, but these generally last even longer than the synthetic motor oil.
4) Have distribution that matches your products. When AMSOIL was the first synthetic oil for cars and cost $5/quart in 1972, network marketing was the correct distribution method. In 2007 when it is selling for less than $6/quart and other synthetic oils are selling for more than $5/quart, I am not sure network marketing is the best method.
(By products, I of course mean products or services, depending on your particular business.)
Hopefully someone got some value out of that long story. It certainly helped me to verbalize some of my frustrations with AMSOIL's business model over the past few years as well as review all of the things I still like (which is why I still sell the products).
I do not recommend AMSOIL as a business for those looking to earn a "rockstar" passive income. I estimate the top earners in AMSOIL make in the $300,000-$1,000,000/year range, where top earners in other network marketing companies make 10x that.
On the other hand, $300k+/year ain't too shabby, and this could be a great business for someone passionate about cars and interested in becoming an expert on the products.
Stay tuned for "My second network marketing adventure...", coming in a future installment.
PS - If you want to go check out the AMSOIL products, use this link to go to my store. Unless you're analytical and love trying to figure things out for yourself, though, it is easier to call (816-896-6566 cell) or email (sfweller@yahoo.com) me for the best solution for your particular situation, even if it does not involve AMSOIL! After having been very active in the business for 3 years, I know more than anyone should know about motor oil and filters :)
Wednesday, July 25, 2007
My first network marketing adventure - Part 1
Just so it is clear during my discussions about network marketing - I am a proponent of it, I currently have a couple of network marketing businesses that produce small incomes, but I am not actively growing either business.
With that out of the way, let's talk about my first adventure with network marketing!
The year was 2003. A co-worker of mine had recently returned from a field assignment that had lasted about a year. When he got back, he was ready to start a side business.
I was just as excited as him, so we formed an LLC together. Only one problem - we had NO idea what we were going to do!
So we had a business, we had a bank account, and we even had business cards. We just didn't have a business plan or a way to make a profit. Small hitch, that.
So we first looked into rental real estate. We listened to some Carlton Sheets materials that we borrowed from someone else and read a few other books. We went to a few foreclosure auctions at the courthouse steps, but (thankfully) decided that real estate was not our first choice based upon what we knew then.
About the time we were deciding real estate was not for us, my business partner "stumbled" across a company called AMSOIL. The rest, as they say, is history.
He was looking for a bypass filter system filter system for his almost new Toyota Tacoma pickup (the same kind of filter system they use on steam turbines in power plants where they don't change oil - can you imagine a 15,000 gallon oil change?). The advantages of such a system would be extended engine life and not having to change the oil nearly as often, which he hated doing.
He found this company called "AMSOIL" that had these bypass filter systems as well as just a 25,000-mile, 1-year oil change. He called the local dealer to get a quote.
Well, the bypass system cost about $200 at the time, but you could pay $30 to become a dealer, which would drop the price of the system to about $150. That seems like a no-brainer.
So we decided to go out on a limb and pay $30 so that we could get the products (synthetic oil and filters) at better prices. (I should also mention that my wife and I were driving about 50,000 miles per year combined, so changing oil twice a year instead of 16 times a year REALLY appealed to me.)
As mechanical engineers, these products made A LOT of sense to us:
1) Generally cost less than regular oil changes over the course of a year (fewer oil changes),
2) Saved gas on top of that (1-4% better efficiency/performance),
3) Protected your engine better (so it lasts longer),
4) Are guaranteed for the longer service (yeah - if something breaks and it's the oil's fault, they pay for the engine repairs or replacement).
5) Reduced oil waste and gas consumption (I thank John Wachholz for my environmental awareness).
We figured if we thought this was cool, all of the other engineers we worked with would think it was cool as well.
As with many network marketing products, your friends and family don't always immediately join your excitement for the products that you are now marketing, and AMSOIL was no exception.
We got a few customers from work and family that started using it. And let's face it, a customer that switches to AMSOIL generates very little commission initially because they only need to buy product once a year! For me even now a customer that is only changing oil on two cars is worth about $8. Especially considering the time it took to get a sale, that is not a great wage.
So we needed to figure out how to get more customers or get larger customers (or both), and that is where I will pick up in Part 2...
Tuesday, July 24, 2007
The book that started it all...
While I had started looking for other opportunities in general before this, the book really took all of my endeavours to another level. I'm talking of course about:
T. Harv Eker's "Secrets of the Millionaire Mind"
I first read the book...OK, confession time - I bought the book but never read it, but I have listened to the unabridged audio version read by Harv himself about 6 times...back in about March of last year. There were a lot of great ideas, but I never really did much with them.
The cool thing about the book, though, is that you get 2 FREE tickets to a 3-day seminar about really changing your mindset about money. The retail price for two tickets is $2590, but you get them free. (Full disclosure - now it costs $97 per person when you register because you get a lot of materials with it - they found that the learning was more effective when people had materials to take home.)
Now, I'm notoriously cheap, as I have previously mentioned, but knowing what I now know about the seminar, I would have happily paid full price for it. It was absolutely worth $1295 per person.
Why would he give away so much value? The most effective marketing being employed right now involves giving away a lot of value in order to establish a relationship and generate revenue from customers down the road. In this case, many people will sign up for more seminars offered by Harv's company (I sure have!). The people that are willing to go to a free seminar are also likely to pay to go to more seminars if they get a lot of value out of it. If they won't go to seminars in general, most won't go to one, even if it is free.
Back to my story: I went with some good friends - Chris, Kelly, and Nate - to a 3-day seminar in December 2006, and I can safely say it changed my life. Not only with respect to money but also improving my attitude toward life in general and relationships with others.
Ever since then, the opportunities have abounded, and things have really taken off. I can safely say that I never would have started this blog had it not been for "Secrets of the Millionaire Mind" and the 3-day "Millionaire Mind Intensive" seminar.
I loved the seminar so much that I went back in February 2007 with my wife (Rebecca). Apparently I "dragged" her to the seminar (this is what she told 800 people at the end of the 3 days). She also told those 800 people that it was one of the best weekends of her life, and she was so glad I brought her.
We are going to volunteer for the seminar in Dallas in November 2007 and "drag" as much of our family with us as we can.
I've actually bought 110 of these books to sell and give to family, friends, and business associates. Now I did get some cool bonuses for buying this many books, but at the same time I strongly believe that everyone should read the book at some point.
Not everyone is ready for the book - you have to be open, which means you have to realize that you don't know everything already. That may come as a bit of a shock to some of you (it did for me :) ), but it is true.
Please - check out the book. Not because I want to make $0.46 or whatever it is from you buying the book off Amazon, but because everyone has great potential to achieve locked up inside them, and this book just might help you release that. If you know me personally, I can get you an even better deal on the book than you can get through Amazon - just let me know that you want one.
This is my strongest recommendation so far - if you can't spring for $14 for a book that will change your life (even if only in small ways), then what else are you going to do to break out of your rut? Think about it.
PS - If you do happen to buy the book and decide to go to the 3-day Millionaire Mind Intensive seminar (did I mention that I highly recommend it?), please use the following referral code: 403014. This does two things: 1) I get paid for turning you onto the seminar (kinda like network marketing!), and 2) it allows Harv's company to determine where the seminar attendees are coming from (whether word of mouth or just picked up in a bookstore). I think it is fair for them to know where their people are coming from.
Again, use referral 403014 when registering for the seminar - thanks!
Network Marketing - ewwwww!
I don't feel this way about network marketing, but a lot of people do, so I want to address some of the common issues around network marketing businesses.
First of all, network marketing is just one way of distributing product and services - getting it from the producer to the consumer.
Obviously traditional retailers (producer to wholesaler to retailer to consumer) is the most common method here in America, but direct order (catalog, TV, or now Internet) is another common method that is somewhat similar to network marketing. There are many others, but suffice it to say that network marketing is just one of many distribution methods.
I think most of our negative connotations with network marketing stem from 2 things:
1) Bad experiences with network marketing in the past. Most people that get into network marketing are very excited but have not received good training on how to introduce the products or business to others. Unfortunately, this can lead to "amateurs" approaching friends and family (the favorite first prospects) and really straining some relationships :)
and
2) Our general distate for promotion. This is one of the most dangerous mindset issues that keep people from achieving true wealth. Most people resent when people are "promoting" a product or service. Yet, how else do we expect to find out about it? We may not be interested in that product or service, but that doesn't mean we should be opposed to hearing about it - we may know someone who could really use that particular item.
But network marketing is really an effective way for distributing certain products that require more education or explanation. A couple of examples:
Let's say you had a synthetic oil that is guaranted to last 25,000 miles or 1 year without having to be changed, yet it cost 10-20% more than other synthetic oils (more about this later :) ). If you saw this brand that you had never heard of (which also costs more) next to the other synthetic oils on the shelf at Wal-Mart, would you even spend enough time looking at it to see this special guarantee?
Similarly, when you go to the drugstore to look at vitamins and you see a $20/month vitamin with what looks to be about the same ingredients of the $75/month vitamin, which one are you going to pick?
In both cases, education as to the specific benefits of the products is required to fully explain the value. It does NOT mean that everyone will be interested even after the explanation (some network marketers don't seem to understand that the majority of people will not be interested in your product even after you explain it). Some people will be interested based upon the educational process (which conveys the product value), whereas almost noone would have been interested without that education.
So network marketing can be a great distribution method for products that require more education or explanation to really explain their value/differentiation.
As an aside - there are a number of network marketing companies (I would say the minority) that created a product just to make money. There is little or no real value to the product, the company just needed to create something for their marketing engine to promote. This also happens in all other forms of distibution as well, but network marketing is more prone to it in my opinion.
Network marketing also allows quick promotion of products with very little money upfront from the producer of the product or service. Some very large corporations have launched products this way because of their ability to spread quickly without a lot of money upfront (money is only made by network marketers by sales of product - commission only). No money is paid out to your network marketing sales force until actual sales are made.
The potential rewards (especially passive income) attracts a lot of talent to network marketing. I mean incomes of $100,000-$1,000,000 per year are achievable. There are a lot of people in network marketing making that kind of money and more, but there are also a lot more people that tried it for a little while, didn't experience any success, quit, and now say "network marketing doesn't work." Of course, like many other things, it does work but not for everyone.
This discussion is prologue to my own experiences with network marketing that I will share shortly. Stay tuned...
Sunday, July 22, 2007
HELP! - How to make money with your blog?
Or to use the proper "lingo" - how do you efffectively monetize your blog?
I wish I had all of the answers on this one :)
As stated in the purpose of this blog, my primary intent for this blog is to journal my journey to financial freedom and share my successes (and not-quite-as-successfuls) with others. At the same time, I have put in some Google advertising (Adsense) blocks in an attempt to not only generate some revenue from the site but also provide more relevant content.
Adsense makes great sense (no pun intended) to me because many readers will stumble across my blog looking for information on a certain topic. You may or may not get value from the information I provide (hopefully you will!), but the ads provide information on similar topics that you (the reader) may find useful. If you do - it's a win-win - you get information you were looking for, and I get some advertising revenue.
My attempts to monetize this blog effectively (note also the link to Amazon.com for the 5-day book) are part of a larger goal of mine:
I hope to start a road trip blog where the revenues from the blog are what I have to live on each day. So no revenue would mean no gas, no place to stay, and no food.
Of course it would be critical to get some revenue generation before starting out because the blog about me sitting in my car in my driveway waiting for some revenue would be pretty boring (potentially very amusing, but still boring).
So that's where I need your help. How do I effectively make money from a blog? Adsense is easy to drop onto the sites, but any tips on generating click-throughs? Targetted advertising? eBooks? A "recommended reading" list linked to Amazon? I would welcome all ideas here - please make a comment to this post if you have an idea.
I plan to experiment on this site with revenue generation, so be aware of that. If you see things on here that you think are good ideas, please let me know. Likewise, make me aware of things that really "turn you off". I want this to be a positive learning experience for all of us.
Many people have great knowledge and experiences that they can share with the world. I think blogs are a great way to do that. If we can figure out the best ways to make some money at the same time, I think that would certainly provide more incentive for people to share via a blog.
Thanks in advance for the help!
Friday, July 20, 2007
Home sweet 4-plex
The financial freedom discussion was important background for this topic, which falls under the reducing expenses side of achieving financial freedom.
For those of you that don't know me personally (and how "frugal" I can be), you may find this interesting. My wife and I were recently looking for new digs in our new hometown of McPherson, KS.
Now McPherson is very interesting. Although it is a small town in Kansas (population of about 14,000, not including livestock), it has a great, stable industrial base which keeps the average wages among the highest in Kansas. As a result, home prices are almost as high as those in Kansas City (for those of you on a coast, that may seem low, but for those of you from rural Kansas, you know that seems high).
So we looked for houses on some acreage (like the one we currently have outside of Kansas City) and found we would have to pay just as much for houses that were about 80 years older.
Instead of buying what we considered to be an overpriced house on acreage, we instead decided to buy a 1920s house that had been converted into four 1-bedroom/1-bath units. And further reinforcing that this was God's plan for us was the fact that two of the four units were occupied, leaving the two larger bottom units open for us!
The way it worked out, we got a 100% loan on the property from a local bank. We ended up getting cash back at closing (we got the renter's deposits, pro-rated taxes, etc - I need to go back and look how we pulled that off - I didn't expect it), and the two renters will ending up paying about as much as the mortgage payment (we have some repairs to do, and we are going to roll that into the mortgage, so I don't know the final amount yet).
Now we do have to pay some common utilities and all of the taxes and insurance for the property, but overall, we will be living in 1400-1500 square feet of space - 2 bedrooms, 2 baths, for very little money.
It is also in the middle of McPherson, so we can walk or ride our bikes most places in town that we need to go (except in bad weather). Very importantly these days that will minimize our gasoline usage.
Just one more step towards financial freedom!
Financial Freedom
I did not really define this well up front, so I want to make sure and define what financial freedom means to me. I think one of Harv Eker's (or T. Harv Eker when he's an author - more on that later) declarations sums it up well:
"I have more than enough passive income to pay for my desired lifestyle."
In other words, you have more than enough income coming in without you having to work for it (from investments, passive businesses, hands-off rental income, etc) to more than cover your expenses.
There are several ways to achieve this financial freedom: 1) increase your passive income until it more than covers your desired lifestyle, 2) simplify your desired lifestyle until your expenses are less than the passive income you have, or 3) some combination of the two.
You can have financial freedom and still be generating an active income from work - you just have the freedom to stop working if you want and still have enough income to live off of. (Yes, I use dangling prepositions because the "correct" grammar just sounds wrong.)
The freedom to work or not as you desire and still have your desired lifestyle - this is financial freedom. I want us to have this common definition for future discussions :)
Thursday, July 19, 2007
Health Savings Account (HSA)
One of the joys of joining the ranks of the self-employed here in America is finding all of those benefits that we take for granted as employees. I have been calling and comparing plans today and thought I would share what I had learned.
For those of you that don't know (don't feel bad, I was in this boat just a few hours ago), health savings accounts act just like a savings account and are coupled with high-deductible health insurance policies. Let's take a look at each piece separately:
Health Savings Account
The health savings account itself acts much like a regular savings account, except that contributions are before tax (an above-the-line deduction - it reduces your federal adjusted gross income - the bottom line on the front page of the 1040 Form). Distributions can be used tax-free and penalty-free for the folowing:
- Qualified medical expenses defined by Section 213 of the IRS Code
- COBRA insurance
- Qualified long-term care insurance and expenses
- Health insurance premiums for individuals receiving unemployment compensation
- Medicare and retiree health insurance premiums, but not Medicare Supplement premiums
After age 65, distributions can be taken for anything penalty-free, but you have to pay tax if you do not use the money for one of the above categories.
The maximum HSA contribution for 2007 is $2850 for an individual or $5650 for a family.
The other nice benfit is most HSA plans pay interest on your savings. I have seen 4-6.15%. http://www.ushealthgroup.com/ claims to pay the highest rate at 6.15%, and I have not found any higher. My understanding is that this interest is tax-free if used for medical expenses as well.
High-Deductible Heath Insurance
The high-deductible health insurance is intended to cover larger expenses that you cannot cover with your HSA money. Key things to look for in the insurance coverage:
Make sure providers you plan to use are in network. You get the contract rates (discounts of up to 90% off "list price") and some plans only pay 100% of expenses above the deductible if you use providers in the network. Otherwise you may have to pay 10-20% of the additional cost.
100% coverage above the deductible. Some plans offer lower monthly rates for 80/20 coverage up to a cap. That means you still have to pay 20% of expenses above the deductible up to some cap ($24,000 on the one I saw). If you choose to go 80/20, make sure you can afford the base deductible plus the 20% up to the cap if something bad happens. It's not worth it to me...
Look at the lifetime maximum benefit. $3 million is typical, but I found Celtic Insurance Co. (1-800-477-7990) that has a $7 million maximum.
Confirm all expenses (including office visit and prescriptions) count towards the deductible. There are lower rate plans that exclude certain items.
"Bonus" coverages - as an example, Humana offers $300 of routine wellness coverage per year. This can be a good deal if a) you know that you are going to use it, and b) it costs less than $300 more than comparable coverage from someone else.
Maternity coverage - not an issue for us, but this is something that you typically have to add separately. Make sure you get it if you expect to be expecting :)
Well, that is all I know right now. I hope that information helps other people that might be looking at the HSA option. I certainly welcome any comments you might have on the subject so that we can all learn more.