Tag Archives: finance

the ultimate measure of financial success

How many times have you heard someone suggest that all their financial problems would magically disappear if they only made more money? But high incomes can’t guarantee financial freedom; there are countless examples of people who earned millions yet still ended up bankrupt. The common thread among folks who get into financial trouble — no matter how much money they make — is their inability to consistently spend less than they earn.

The bottom line: The ultimate measure of financial success is not the size of your paycheck. Rather, it’s the money left in your pocket after paying for all your obligations.

source: Len Penzo

check your home, auto, and plp insurance policies

Every few months to year I take a look around to see if anyone can give me a better rate on my auto & renters’ (home) insurance. This month, after 3 years, I found a carrier who could knock about $60 a month off my payment *and* give me more coverage.

Interesting things I learned in this process:

  • you want a Personal Liability Protection – “umbrella” – policy
    • provides coverage over-and-above the limits on other policies you hold
    • follows you world-wide (at least with my carrier)
  • individually-scheduled items on a renters’ (or home) policy are covered even if something happens away from home
    • say you have your wife’s engagement ring individually-scheduled
      • if she loses it at the beach, it’s still covered
      • if it’s stolen from home, it’s still covered
    • the cost of adding individually-scheduled items is a fraction of their cost to you if something goes awry
  • max-out your auto policy’s limits – you’ll get better rates
    • if you carry state minimums (25k/50k in KY), you will have a higher rate than if you increase your coverage levels (it was a $300/year difference for me (not that I’d ever take minimums, but it was still interesting)
    • the insurance companies factor-in your “insurance intelligence” when giving a quote
      • if you pay for more coverage, you’re “smarter” about insurance, and less likely to have a claim
  • the company you’ve been using for years takes all the factors in your driving, credit, and other relevant histories and calculates your risk to them differently
    • so shop around!

I was with my last carrier since moving to KY in 2010. I don’t know how long I’ll have my new one, but for now, increasing my coverage, expanding its scope, and reducing my payments are all great.

I went from 2 to 3 policies (including the new PLP), and am pretty excited (though, of course, I also hope to never need them).

the richest man in babylon by george s clason

The Richest Man In Babylon by George S Clason is one of the few audio books I have enjoyed – and one that I think everyone should read/listen to frequently: it’s the early 20th century version of Dave Ramsey’s Total Money Makeover (another great book).

The advice/suggestions in this book are things I didn’t listen to soon enough – and I’d hasten to help anyone do earlier what I didn’t 🙂

If you take nothing else from this book, follow the first “law”:

The first 10% is mine to keep

From a Christian perspective, that should be reworded to “the second 10% is mine to steward” (if you presume the first tenth belongs to God).

This sounds difficult – but if you incorporate that single principle into your financial thinking early, you will be very well served later in life.