Investing In Yourself – Using Pillars to Build Your Core
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Setting Budgets + Saving for Black Swans
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How to Open My First Brokerage Account
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Diversify your Life (Mind, Body, Soul, + Investments)
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Thanks for tuning in. I've heard from so many people so these discussions will frame my upcoming blog posts. For example, I raised the discussion of what to do with your retirement accounts so I'll be addressing that soon. This week, I fielded multiple questions on should I start buying. I will try and address all of these items but not in a frantic manner --- remember we were built for these moments. We've been investing in ourselves, setting our budgets, saving for black swan events, diversifying our portfolios and strengthening our core for these very moments.
People and Safety First
First things first ☝ always remember that people...yes I said people and safety always come first. That is why I was so passionate about what the next steps should be for this country during an outbreak like this. As a risk manager, this is the number 1 rule and it must not be forgotten. If this were my favorite show "Heroes" you would hear the phrase 'Save the Girl' --- well my response to the administration is 'People First Profits Will Come'. Sometimes we all need that subtle reminder. 👂
Stick 2 Da Script
If this is your first time get familiar with my pillars above. If you've been here before don't forget them because this is a life-long journey of having the tools you need when things are GOOD and when they are BAD. Again I've received a lot of questions this week and I assume people will take their time to read through my blog before firing off their questions but that isn't always the case. The most common questions I get are:
- Is it a Good Time to Buy?
- What Stock(s) Should I Buy?
These are solid questions if you are a seasoned investor, who invests in the markets often. However, I want to start a new trend --- where people are comfortable talking about how much they got in savings first! You tell me what car you drive, where you work, your favorite drink, damn some people even rattle off their credit score BUT people get real quiet about their savings. So I'm here to remind you of my Rules above...because the first investment you should be asking me or anyone about is How Can I Invest In Myself. And here is my answer:
Set a Budget Every winter its 2 things -- cuffing season 💑(if you're single) and budget cutting season ✂. I revisit my budget and guess what I found out -- It goes UP, DOWN, or stays the same. It rarely ever stays the same so I challenge everything that goes up.
Mortgage - Have you refinanced?
Insurance - Have you asked for lower rates or called a new competitor for quotes?
Bills - Can't fight these much but do you need that super cable -- when you work 5/7 days a week a least? Can you phone a friend for that Netflix account?
Urb Lesson of the Day - Being a boss means doing the dirty work, and having tough conversations. This week alone, I had CEO discussions with my banks and what they need to do to keep my business --- remember they work for you.
Start Saving 💰 - Real savings IMO is the money saved up AFTER you have no outstanding debts in your household. So set your budget to get on a plan to begin saving for your future and future BLACK SWAN events. Before the coronavirus crisis, I've talked about black swan events being the one thing we are always on the look out for. Well that event is here and a deep savings account helps ease those of us panicking if schools are closed, your company shuts down temporarily, you unfortunately get laid off, medical bills surface, etc. Remember the government shutdown, H1N1, 2008 financial crash make sure you're not a part of this statistical group: Roughly 70-80% of American workers live paycheck to paycheck. (Source: 2017 Careerbuilder Report)
This is why I was passionate about putting money in hands of the American people. I predicted state and national shutdowns would be required to slow down a contagious disease (note: China, Italy, S. Korea all showed why this is necessary). That finally happened here in the US. Why was the response so slow? Well, they are scared to shut the system down --- because the capital machine has most people living paycheck to paycheck. So work can never stop (for those who cannot telework/work from home), I guess even when your health may be at stake. I applaud this gent for keeping it real on national TV, he acknowledged its a big problem when most Americans live paycheck to paycheck:
Urb Lesson of the Day - I live to save because there will always be black swans, moments that shock you and your family --- weddings, deaths, travel, layoffs, medical bills --- you want to have the savings to get you through these moments. I know the rent, bills, and food has to be paid but the long-term plan is we need a healthy you to be a provider for yourself and family for years to come. Use these markers to benchmark how much you need to save for a rainy day:
2 Weeks Pay --- Rookie
1 Month Pay --- Rising Star
3 Months Pay --- Honorable Mention
6 Months Pay --- Veteran
12 - 24 Months Pay --- All Star (Cue Biggie: "I'm not only a client, I'm the player president")
I personally have moved to cash in my individual retirement portfolio because you have to sit down and map out what happens next: businesses slow down, layoffs will rise, and earnings from corporations will be bad for the next few quarters. My retirement money is just that a second savings account I can afford to be very careful with. Your primary savings account is a cushion for whatever is to come. Stay tuned for more, I will address what to do with your individual retirement accounts and for those aggressive people trying to gain an edge in the market --- YES we'll discuss stocks to buy.
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