Posts Tagged ‘investing’

“You can almost always get a little boost by spending money you don’t have. But unless you’re investing in something that will make a profit, you’re just wasting time and money… and making the situation worse.” -Bill Bonner

“Even if you buy a car with cash, you are forfeiting the opportunity of investing that cash and earning a return on it. So even people who always ‘pay cash’ still experience the same implicit trade-offs between spending now versus later…the real question is whether you are going to obtain your financing from a bank controlled by outsiders, versus a bank that you control.” -Robert Murphy

“An individual doesn’t enrich himself by borrowing capital.  He can only enrich himself by carefully increasing his utility (his skills), saving his excess production, and investing that capital wisely to further increase his production.” –Porter Stansberry

“Most people assume that if you know about investing, you must also know about economics, which is a related discipline.  But that’s completely untrue.  It’s analogous to thinking that someone who knows how to drive a car also knows how one works.  Economics is the study of how men go about producing and consuming; investing is the practice of allocating capital for maximum returns.” -Doug Casey

Building wealth involves much more than just investing in stocks and bonds.  Most rich people get that way by consistently doing five things:  1.  They understand and manage their debt.  They don’t let debt manage them;  2.  They spend their money wisely, getting maximum value for every dollar;  3.   They continuously work to increase both their active and their passive incomes;  4.  They are aggressive savers, far outpacing their peers;  5.  They are disciplined investors.  When they find a good strategy, they stick with it. -Mark Ford

Warren Buffett, in his 2011 letter to investors, defined investing as “the transfer to others the purchasing power now with the reasoned expectation of receiving more purchasing power – after taxes have been paid on nominal gains – in the future.” What’s important to remember is “It’s not the dollar value of your investment returns that count. It’s how much your investments increase or decrease your spending power after you’ve paid taxes.” -Chris Hunter B&P Briefing

“You cannot reach financial independence through stock investing and options alone.  You need to increase your income through different avenues and opportunities.” –Mark Ford

1.       “The first thing you must do is accept the fact that you are solely and completely responsible for your current financial situation.

2.       The next thing you must do is set realistic expectations.

3.       The third thing you must do is thoroughly understand the difference between spending, saving, and investing.

  4.     The fourth thing you must do is recognize that your net investible income (the amount of cash you have after spending and saving) is the single most important factor in determining how quickly you will become wealthy.”

Mark Ford     The Palm Beach Letter    April 24, 2013

Cost of Debt

Posted: April 29, 2011 in Money Matters
Tags: , , ,

A person who made $25,000 per year in income would have $1 million pass through their fingers over a 40 year working career.  If this person was an average American, they would spend $350,000 of that income servicing debt.  Overcoming debt is a different way of looking at investing.