Credit Card Debt is for Losers: 4 Quick Tips to get it Under Control

Debt is a form of slavery. It can be crushing and debilitating, as well as a major hinderence to building wealth, which is why in most cases it’s wise to avoid it like the plague if you can. Check out a few tips to get out of credit card debt.

  1. Stop Spending

When you find yourself in a ditch stop digging. Get a hold of yourself you don’t need that Louis Vuitton belt buckle.

2. Make a Budget

Track your spending, create a budget and trim the fat from expenses. A little here and there can add up.

3. Increase your Monthly Payments

If you just pay the minimum payments it can take years to retire the balance. So pay as much as you can and as often as you can.

4. Make your Payments Sooner Rather than Later

The earlier you pay in your bill cycle the less interest you’ll pay for that month. Credit card interest is calculated based on the average daily balance. By making payments earlier the interest that accrues is reduced.

Those are just a few quick and dirty ways to reduce your debt that have worked for me. What are some of your tips to eliminate debt? Hit me on the Gram.

Martel

Guess How Many Millionaires there are in America

The Credit Suisse Research Institute recently released their Global Wealth Report for 2016. The report notes that the U.S. has 13,554,000 millionaires.

The best way to join the millionaires club is not by playing the lotto (the odds of winning the powerball are 1 in 292 million). Here’s the tried and true formula for becoming a millionaire, before I tell you I must warn you it’s boring but it will get you to the promised land. Okay here you go:

  1. Spend less than you make
  2. Commit to saving $5,500 per year, invest it in a low cost index mutual funds.
  3. Increase the amount you save by 5% each year i.e. $5,500 x 1.05 = $5,775 in year 2 and so on.
  4. Repeat this process for 30 years and you will have $1,136,661 (assuming an average 8% return on principle each year)

For some cool retirement and 401k calculators check out NerdWallet.

There you have it. The secret is yours my friends. Live within your means and save. Once you’ve got these basic principles down we can experiment in business and try to expedite this process.

Martel

Not Every Pro-Athlete Goes Broke After Leaving the Game, Just Ask Jamal “Monster Mash” Mashburn who Owns Over 80 Franchises

80% of professional football players and 60% of NBA players experience financial failure shortly after retirement. The list of horror stories of athletes going belly up when the “music stops playing” seems endless; Vin Baker, Antoine Walker, Lenny Dykstra, Curt Schilling, Mark Brunellthe list goes on.

Jamal Mashburn was a college phenom at the University of Kentucky and the 4th overall pick in the 1993 NBA draft by the Dallas Mavericks. He played 12 seasons in the NBA averaging 19.1 pts per game, before injuries took their toll.

Early in his career Jamal was conscious that the fame and NBA checks would not last forever and conducted himself accordingly. He adopted the philosophy of “always working with the end in sight.” Jamal viewed basketball as a means to an end. It was a vehicle to help aquire the capital and relationships to launch sustainable businesses. He lived well below his means and saved for the proverbial “rainy day.” Mashburn always knew he wanted to get into business and upon retirement he began to immerse himself into developing his empire. As a result of his prudence, he’s proven to be as successful off the court as he was on the court. Today Jamal owns over 80 restaurant franchises (Papa John’s, Outback Steakhouse, and Dunkin’ Donuts), several car dealerships, real estate, a marketing firm and a venture capital firm. Whew! I reckon he’s not too bored in his retirement years.

The key takeaways here are:
  1. Stack your paper, work hard and save for your initial capital in order to invest it.
  2. Don’t invest willy-nilly, take chances but be be smart about them and do your due diligence. As noted above Mashburn invested in tried and true business models such as franchises while also allocating a small portion of his portfolio for moonshots (riskier investments with a chance for higher returns) via his venture capital firm. (Strike the right balance of risk for your portfolio.)
Kudos, to Mashburn we wish him continued success! Are you building an empire? Hit me on the Gram, I’d love to hear about it.

Martel

Lots of gems in this video, hope you enjoy and pay it forward.

11 Best Careers In America

MogulGrind is all about entrepreneurship but sometimes you need to keep your day job while you’re building your empire. If you have to work a 9 to 5 you might as well enjoy it, and be compensated well. With that said check out Glassdoor’s recent ranking of America’s top jobs for 2017. Glassdoor used three factors in the rankings: Average annual salary, an overall job-satisfaction rating, and the number of job openings available for that particular occupation.

Interesting to note, that 7 of the top 11 jobs are tech related. Get your math and science skills up kids!

  1. Data Scientist – Median Base Salary: $110,000
  2. DevOps Engineer – Median Base Salary: $110,000
  3. Data Engineer – Median Base Salary: $106,000
  4. Tax Manager – Median Base Salary: $110,000
  5. Analytics Manager – Median Base Salary: $112,000
  6. HR Manager – Median Base Salary: $85,000
  7. Database Administrator – Median Base Salary: $93,000
  8. Strategy Manager – Median Base Salary: $130,000
  9. UX Designer – Median Base Salary: $92,500
  10. Solutions Architect – Median Base Salary: $125,000
  11. Marketing Manager – Median Base Salary: $90,000

Check out the full list of 50 jobs here.

Martel

Guess What the Average 401K Balance is in America: How do you Stack Up?

Fidelity Investments manages over $5 trillion in investment accounts. According to their most recent analysis of Individual Retirement Accounts (IRA) and 401k accounts here’s what they found:

  • The average IRA account balance for the 3rd quarter in 2016 was $94,100, up from $88,000 in 2015.
  • The average 401k balance for the 3rd quarter in 2016 was $90,600, up from $84,400 in the previous year.

Now Is This A Good Or Bad Thing?

Great question. If you’re young then it’s fine and dandy, but if you’re about to retire then not so good. Let’s look at the math:

$90,000 in an IRA adding $5,500 per year (approx $114 per week) over 30 years compounding at 7% interest rate per year, you wind up with $1.2 million.

On the other hand if you take the same scenario but only have 10 years before retirement you end up with approx. $253k over 10 years.

The Moral Of The Story

Save! Save! Save! The sooner you start saving the better. Compound interest is your friend. Take advantage of it as soon as possible.

Martel

Not Saying There’s a Housing Bubble But…

Record Debt Outstanding

Over the past couple of months the big banks (Wells Fargo & Co., Goldman Sachs Group Inc. and J.P. Morgan Chase & Co.) have begun offering credit lines to lenders that specialize in house flipping (investor buys a property, makes updates then quickly resells it). The amount of loans outstanding for house flippers neared $48 billion in 2016. That’s the highest since 2006, the peak of the housing bubble. Through the 3rd quarter of 2016 the number of home flippers hit it’s highest level since 2007. House flipping deals tend to typically be done with cash, however in 2016 one third of the deals were made with debt. That’s the highest in over 8 years!

Low Doc Loans Making a Comeback?

Home prices nationwide are the highest they’ve been since the 2008 crash. Some borrowers have reported that they’ve been offered loans that exceed the value of their homes. Others have reported that lenders are relaxing their loan requirements by requiring bank statements but not the standard W-2 tax documents. Additionally more and more people are getting in on the flipping action. Seminars are popping up left and right teaching people how to flip homes and promising boatloads of cash. The average flip nets approx $61k, this is up from $19k at the bottom of the crash in 2009.

If It Walks Like a Duck and Quacks Like a Duck…

Hmmmm I’m not saying a bubble is brewing, but c’mon son, judging from the previews this movie is looking pretty familiar. It might be time to start slowly increasing our cash positions in order to be able to take advantage of opportunities and/or ride out the storm in the event of a downturn. The economy naturally tends to correct itself every 10 or so years and guess when the last recession occurred, 2007.

Martel

 

 

Becoming a Millionaire is Easier than you Think: 5 Wealth Building Tips

1. Pick The Right Profession – You can become a millionaire on a small salary with proper saving and spending habits but it will be a lot more challenging. Look to boost your income either by improving your skillsets through education or supplementing your income via a side hustle/second gig. Check out this list of best and worst jobs for the future.

2.The Stock Market Is Your Friend Bruh… – The stock market has it’s ups and downs but over the long term it returns approx. 7%-8% per year. If you invest $10,000 and let it sit in the market for 3 years compounding at 7% you’ll have $12,250 at the end of that period. Now let that compound for a long period of time and routinely add to the principle to accelerate the growth and you’re on your way to building considerable wealth.

How Compounding Works

Year 1 = $10,000 + ($10,000 x 7%) = $10,700

Year 2 = $10,700 + ($10,700 x 7%) = $11,449

Year 3 = $11,449 + ($11,449 x 7%) = $12,250

Albert Einstein is famously quoted as saying “compound interest is the 8th wonder of the world.”

3. Save! Save! Save! – The sooner you start saving the better. If you save/invest $671 each month at age 35 you’ll have$1 million by the time you turn 65, assuming you earn an 8% annual return. The sooner you start and the more you save, the quicker you get to $1 million just from saving!

4. Step Out Of The Matrix (Live Within Your Means) – If you don’t have it, then don’t spend it period point blank. We don’t need a fraction of the things that we think we need. The realization of this, is what I call stepping out of the matrix. Advertisers are so adept at tricking us into thinking we can’t live without their products. A little discipline and sacrifice now will go a long way toward gaining financial independence. Soon enough you’ll be able to purchase what you want with cold hard cash instead of financing it and building a mountain of debt. Debt is a form of bondage, it can be suffocating so shun it like the plague.

According to the National Foundation for Credit Counseling, one out of every three American households carries credit card debt from month to month. And the average credit-card debt is $16,061, according to the Federal Reserve.

Total owed by average U.S. household carrying this type of debt Total debt owed by U.S. consumers
Credit cards $16,061 $747 billion
Mortgages $172,806 $8.35 trillion
Auto loans $28,535 $1.14 trillion
Student loans $49,042 $1.28 trillion
Any type of debt $132,529 $12.35 trillion

Debt balances are current as of Q3 2016; figures are updated quarterly by the Federal Reserve.

5. Create a Budget – It’s important to know where your money is going. Once you’re able to track how your money is being spent it’s easier to control and make adjustments where necessary. I use both an old fashioned excel spreadsheet and also track my expenditures using Mint.

To paraphrase the late great Biggie Smalls “now you’ve got the manual, a step by step booklet for you to get your game on track…”What are some of the tools & techniques that you use for building wealth and staying debt free?  Hit me on the Gram.

Martel

What’s Billionaire Buffett Investing in these Days?

The second richest man in the world, Warren Buffett added a cool $12 billion to his stacks in 2016, bringing his net worth to $74 billion. That’s a 20% increase over last year. Bill Gates still owns the title of richest man in the universe with a net worth of $84 billion, but the “Oracle of Omaha” is on his heels.

Buffett’s investment company Berkshire Hathaway recently released its results for the year and here’s some of Warren’s top performing investments for the 4th quarter of 2016.

Airlines

  • United Continental Holdings Inc. (UAL) up 46%
  • American Airlines Group Inc. (AAL) up 34%
  • Southwest Airlines Co. (LUV) up 32%
  • Delta up 27%
  • Arca Airline Index (XX:XAL) up 27%

Financials

  • Wells Fargo & Co. (WFC) up 23%
  • Goldman Sachs & Co. (GS) up 49%
  • M&T Bank Corp.(MTB) up 36%
  • U.S. Bancorp(USB) up 22%
  • American Express Co. (AXP) up 16%

Media and Food

  • Charter Communications(CHTR) up 44% on the year.
  • Kraft Heinz Co.(KHC) up 21%.

How’d The S&P 500 Do?

The S&P 500 (SPX) was up a scant 4.2% during the same period (last 3 months).

They don’t call him the world’s greatest investor for nothing. Mighty impressive sir!

 

Martel

Solar Energy is Now as Cheap as Fossil Fuel Energy: Elon’s a Friggin’ Genius!

Interesting “Did You Know”

According to the World Economic Forum, solar and wind energy are now the same price as fossil fuel energy. 10 years ago the average cost for generating a megawatt hour of solar energy was $600. Today the cost is down to $100 per megawatt, the same average price of coal energy. In 2016 renewable energy investments exceeded fossil fuel investments for the first time ever.

Maybe Elon Musk is on to something with merging Tesla & Solar City…. It’s all about renewable energy duh. Stevie can see it’s the next wave, along with autonomous vehicles, virtual reality and marijuana. Hmmmm maybe it’s time to consider adding Tesla to the stock portfolio as a spec tech play?

What are your thoughts? Hit me on the Gram, Bam!

Martel

 

If Mark Cuban Lost it All Here’s How He’d Get It Back.

Mark Cuban is a billionaire who knows a thing or two about the mogul grind. He owns the Dallas Mavericks and is a star on the hit entrepreneur reality TV show “Shark Tank.” In an interview on the podcast “How I Built This” he talks about what he would do if he had to build an empire from scratch. Mark admits he might not become a billionaire, because in addition to hard work it takes an immense amount of luck as well. However, he’s convinced he would become a multi-millionaire.

Here’s what he would do if he lost it all and had to start over:

Step 1 – Go out and get two jobs. He would get a job as a bartender at night and a sales job during the day. He’s had success as a salesmen in previous jobs and would draw on that skillset to generate income.

Step 2 – Between selling a product with substantial commissions and working as a bartender he would save enough capital to start a new business.

And from there my friends the rest would be history, according to Mark.

Only if it were that easy. It’s tough starting a business and convincing people to give you their hard earned money for your product or service, unless you’re a drug dealer. Wait a minute isn’t marijuana legal now?

I’m on it!

He does make one very good point, you have to do something to generate startup revenue. It’s not going to fall off a tree and hit you in the head. If you can generate enough revenue with one job great, but if not  then pick up a second. You won’t do it forever, just enough time to generate the seed capital to make your next move. From there you can put your money to work for you in a number of ways.

If you could start any business what would it be? Hit me on the Gram.

Martel

 

 

So You Want To Get Rich, Then Do These 5 Things: Secrets of The 1%

First let me preface this by saying I’m not rich, so take this advice with a grain of salt. I do pretty well for myself and since I’ve been following these principles I’ve established a good trajectory toward one day joining that 1% club I’ve been hearing about. In my life I’ve had the privilege of hanging around a lot of uber wealthy individuals. I’ve jotted a few notes down along the way and it’s only right that I share the wealth with my fellow Moguls on the Grind.

Keys to Building Wealth:

1: Pick a High Paying Career

Yeah I know what they say about pursuing your passion and all, but if your passion pays minimum wage maybe you should pursue your passion on the side and if you blow up from it then cool. My advice is to choose a career that pays well. It makes it that much easier to save and jump starts you on the path to generating significant wealth. Here’s a list of top paying gigs that might be worth taking a look at.

An alternative to picking a career that pays well is getting a side job to generate extra income i.e. driving for Uber/Lyft, Postmates, etc. The bottom line is take action to increase your net income.

As you advance in your career or generate more revenue be cognizant of “Lifestyle Creep,” the more you earn the greater the temptation is to increase your expenses. You’ll want to avoid this if you’re interested in getting rich.

2: Save a Minimum of 20%

A lot of financial advisors suggest saving a minimum of 10% each paycheck for retirement. I’m of the ilk that you should save as much as you can without going insane. Have fun every now and then but stack your paper. In addition to the 10% saved for retirement purposes, save an additional 10% for near term expenses/emergency funds. In other words save at least 20% of what you make (and more if you can).

3. Say No to the New Car (and other expensive wants)

You’ve got a little cash saved and you’re doing well in your career. Resist the urge to buy a new car. This is a surefire way to remain in debt and slow your wealth creation.  Remember you don’t need the latest and greatest just to keep up with the Joneses. The goal is to be rich not look rich!  Now let’s stay focused. Run your existing car into the ground then if you need a new car pay with cash.

Interesting story, A close friend of mine was fortunate to play a number of years in the NBA, at the height of his career while making millions, he was getting around in a Toyota Prius and his wife drove an old Mercedes Benz that used vegetable oil for fuel.

Like the rapper Nas once said “By the time you can afford it the car aint important.”

4. Make a Strategic Home Purchase.

I think owning real estate is an important vehicle for creating wealth. My wife and I currently own two properties. My philosophy on real estate is this: If you’re going to be paying someone’s mortgage why not pay your own or have someone paying the mortgage for you (a tenant in an investment property)? Of course you have to get into a position to purchase real estate, hence this is why we do steps 1, 2 and 3.

When it comes to real estate, there’s only 3 things you need to remember, location! location! location! Agents say (and history confirms), the extra money you spend purchasing in desirable neighborhoods in a good school district is money well invested (high demand equals higher returns).

5. Start a Business

The first 4 points listed above will get you to a solid foundation and generate wealth for you, but I found one thing very common among the super wealthy that I’ve had the privilege of meeting. The majority of them created their own businesses. Whether it’s their own Sports Agency, PR Firm, Tech Startup etc. They all took a chance, in fact they took several chances. They’ve failed plenty of times in business but they learned from those hard lessons and came back even stronger.

If they can do it, you and I can do it. Let’s get to work!

What are some of your tips for wealth building. Hit us on the Gram.

Martel

 

“By the time you can afford it, the car aint important.” Nas (around the 2:30 mark)

Ever Wonder How Much Money You Should Have Saved For Retirement By Now?

Are you on track for retirement? Here’s a few rules of thumb courtesy of the good folks over at Fidelity Investments.

Wanna hear it? Well here it goes:

  • At age 35, you should have saved an amount equal to your annual salary.
  • At age 45, you should have saved three times your annual salary.
  • At 55, you should have five times your salary.
  • When you retire at age 67, you should have eight times your annual pay.

Start early! The sooner you begin saving the longer you have for the interest on your money to compound. Albert Einstein once said “Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.”

Live below your means and shun debt like the plague. To paraphrase Nas “These are some jewels for your skull that you can sell if you chose.” In other words heed this valuable advice folks.

 

Martel
One Love!