You Are Money's Master - Financial Fasting and How To Control Your Spending Using the Principle of Kaizen: One Small Step At A Time

One financially-related activity that I like to perform as often as possible - especially when I've gone through a bout of either over-spending or a period of reduced cash flow - is to force myself to not spend at all for at least one day a week, if not the entire week. It's an activity that's similar to fasting, and like that activity, can help you purge pysche of spending guilt, and maybe even help you on the road to financial recovery.

I got the idea from a yearly event where, on a specific day of the year, you are encouraged not to buy anything. Obviously, there are many people who are not going to promote such a day, so you may not have heard of it. In fact, I'll be honest and say that I can't remember what day of the year this unofficial event is on. But that doesn't mean you can't follow its principles on any other day. In addition to this "spending fast", I also apply the Japanese principle of Kaizen (originally part of the Chinese principles of the Tao te Ching). Kaizen is the practice of improvement through slow degrees, or one small step at a time.

Try it yourself. It's not an easy task, and you may only be able to accomplish it for one day a week. Or you may manage to go through it for a few days, but then go through spending withdrawal and end up spending more after this "fasting" period. If so, fight that withdrawal by spending very small amounts. Spending addiction almost always exists due to depression or feelings of low self-esteem. To fight such addiction is not easy without solving the real problem, but I find that my "spending fast" helps me. Applied regularly over a long term, it has helped me not only reduce my "urge" spending but also to live on a smaller budget.

Here's the easiest way to start: pick a day of the week when you typically don't spend very much. For many people who work a regular 9-5 job, this day is Sunday. People tend to stay at home, do laundry, or visit family members. Remember, the idea is to not spend a single cent, including debit cards, credit cards, etc. If this impossible because you need gasoline or a bus ticket, or some other "necessity", then give yourself a very low limit of, say, $3-5. Then next time, try reducing this limit or buy gas or transit tickets on a different day. Or consider a monthly pass.

Curtail all your spending for a single day each week. This means no going out to dinner, nor even buying a packet of chewing gum. The goal is no spending in any form. You can, however, use any coupon that does not require you to spend any extra money, including taxes.

As I said, you'll probably go into withdrwawal at first. So spend only on items that are an absolute necessity. If you are aware of your daily habits - such as coffee or chewing gum or croissant, etc. - then try to abstain one item at a time. Even if it takes you weeks to accomplish a wholly spend-free day, that's better than never getting there if you give up. Go slow.

Perform these "financial fasting" periods properly and without anxiety, and you'll experience a catharsis that actually boosts your feelings of self-worth. This creates a positive feedback loop, which allows you to continue this activity. Similar to the way that food fasting clears your body of toxins, financial fasting helps you slowly clear your mind of negative perceptions about money and yourself. Just make sure, however, that you have some long-term positive purpose selected for the money you save: it'll help you to continue these exercises.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

Technorati : debt control, debts, financial fasting, kaizen, one step at a time, saving money, spending addiction, spending guilt

Penny Stock Investing? Burn Your Money Instead

I could give you my standard metaphysical bent on money, success, and wealth. But not today. Let me get to the point: If you have a choice between investing in penny stocks - i.e., shares are worth less (worthless?) than a dollar - or throwing your money into a bonfire, choose the latter. At least you'll get some warmth as you watch the sparks and pops of your hard-earned cash burning. Having invested $3000 into a mining penny stock, watched it go up several cents (about $600 increase in my holdings) in one day, then thrown in another $2000 of my job bonus money, I yanked out my hair when the stock dived down for the next five market days. At this point, I called up the company and got one of the top dogs, who was chuckling on the phone while eating a peanut, as he told me. Something about his tone of voice, something about the way he evaded my questions suggested that maybe he was chuckling at me.

So, now this is only my opinion, but there are only three reasons to invest in a penny stock:

(1) You own the company.
(2) You know someone that owns the company (but this is dangerously close to insider trading).
(3) You like to throw away money. (Instead, throw some my way, and I'll invest it for you.)

Enough said.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

Technorati : day trading, investing, penny stock, stock market

Poorest People Are Happiest Part II

I can't explain the rationale, but during the time that I was at the poorest in my life was also my most spiritually-fulfilled and happiest - aside from my worries that I should be taking care of my parents sometime soon. It may have been the fact that I was freed from the normal stresses of a career: sitting in traffic during daily commutes, meeting impossible deadlines, reporting to a boss with some twisted agenda, working with colleagues who always seem to think that I'm a threat to them because of my experience. Whatever it is, I found some happiness, despite the struggle to pay my bills. Money might make us happy, but it isn't ever enough by itself.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

Technorati : happiness, poverty, spiritual fulfillment, wealth

Don't Take Cash/Pay Advances - Charge Yourself Interest.

I know this is obvious, but it helps to be reminded: Don't take cash advances if you can help it. Cash loans can turn into evil temptors/temptresses. Having cold hard cash in advance is so alluring. And if you have a spending addiction, it gets very easy to keep going to your local friendly cash-chequing place and get an advance on your next paycheck. Think about how much interest you're paying them. I know from hard experience that, once you start doing this a few times, you start spending the next paycheque sooner - even before you get it. This is the surest way to financial debts as well as personal problems with those that care about you. Use one credit card maximum, and only for emergencies or big ticket items - where you know that you'll be paying it off by the end of the month, before your credit card company charges you interest on the purchase.

Now that said, I know how damn hard all this is to do if you do have an addiction. As a starting point, the next time you're about to spend cash on something you don't absolutely need, turn around, turn away from wherever you were going. Either put the entire amount into some form of savings (piggy bank rather than bank), including the amount of service charge the cheque-cashing place would have docked you.

If you have no discipline, hand your money over to a trusted friend or relative. Or put it in a "one way" piggy bank. Then, every other day, don't spend your money if you don't have to. If you can go one day without spending money, you can go two. Obviously, you can't keep this up forever, but try to never spend money two days in a row for anything other than, say, parking, toll booths, or emergencies. It gives you some structure to work with, something most of us spending addicts have trouble establishing.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

Technorati : check cashing, cheque cashing, finances, interest charges, pay advance, saving

The Downward Spiral of Spending Addiction

In my lifetime, because of my nature and my careers, I've had the good fortune to meet many thousands of people (my goal is to meet 2 million people). Over the years, I've noticed, in speaking to many people, that an overwhelming cause of addiction - whether to intoxicants or to overspending or something else - is depression. Some forms of depression appear to be chemical; others are due to unresolved feelings about a traumatic experience. Addiction, particularly to spending, then becomes a means of controlling some small slice of euphoria, of positive feelings. The downward spiral - sometimes into severe financial problems - is due to the fact that the euphoria experienced is impermanent, and so it increases the level of depression.

North American society has been suffering unprecedented levels of what is called "functional depression". In this form, you can carry out a career and day-to-day tasks. But your depression erodes your physical and mental health, eventually reducing your competency in almost anything you do. You're likely to take increasingly more sick days, which usually leads to being fired or possibly long-term disability.

The net result can be total nervous breakdown, violent outbursts, or even financial self-sabotage, possibly resulting in the breakdown of family and personal relationships, inability to hold down a job, and sometimes serious debt problems or even bankruptcy (although the latter can happen for other reasons including bad business decisions and being cheated by partners).

While I personally don't believe in medicating all of our problems, I don't think I need to tell you, if you're depressed, to go see a psychiatrist, therapist, doctor, or some other alternative health practitioner. Your mental, physical, and possibly your financial future depend on it.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

Technorati : addiction, depression, finances, spending addiction

Unusual But Sensible Investment Ideas - Common Goods

Ask yourself, what group of products do most men and women use, every single day? Hygiene and related products: shaving cream, razors, toothpaste, toothbrushes, tampons, hairspray, hair colouring products. Search for any of these terms using Google or another search engine (MSN, Ask Jeeves, Excite) and track down the largest makers of some of these products. What do you want to wager that, long-term, regardless of the state of the economy, these stocks are all making a profit? That's because everyone, to some degree, needs these products. Increased sales usually equate to increased stock price. That's not to say that these stocks never have a downturn, but there might be obvious cycles in their prices.

Other industries that also weather economic downturns, but not always as well, are: clothing and shoes (non-designer); pet food, snacks and play toys/ accessories; utilities (hydro, phone). There are more industries, but these are the ones I've either observed, worked for, or know someone who has. I also speak to consumers regularly to get an idea of what they buy during different states of the economy.

While I'm not saying to put all of your investment money into these industries, it's worth your while to track some of their stocks and consider a few LONG-TERM shares. (I.e., don't buy them to day-trade.) And please, before you do any investing, speak to your investment advisor.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

Technorati : finance, investment, metaphysics, money, stocks, success, wealth

The (Financial) Truth Is Out There - Or Why Read This Blog

I know my posts so far have been more cryptic rather than straightforward. But there's a solid reason for that. Two, in fact. The upfront first reason is that there already are so many "financial" blogs dispensing solid advice. I have long approached money from a metaphysical point. Personally, it's the only way I can justify having money at all. It sounds kind of new-agey, but that is not necessarily a bad thing. When it comes to something like money, which we all need in varying degrees to live on, if one method of acquiring money isn't working for you, why not try something else? As long you follow the Golden Rule, and don't spend more than you make, a road to wealth is out there. I'm hoping to explore some of those roads in this blog, over time.

You might ask yourself, "What does a person who just got out of bankruptcy know about money? He's the last person I'd listen to." Fair enough; that's a logical reaction. However, I've heard it said many times over the years that the wealthiest people failed first. In fact, most of them failed at least three times before they made it "big". (By this measure, my success is around the corner.) By failing, they learned valuable lessons about what not to do for acquiring wealth. And they tried. Those who never try rarely become successful, unless it's handed down to them.

I certainly feel like I know what not to do. Add to that the fact that I've studied numerous biographies of successful people; read, absorbed, and applied various principles of wealth acquisition; advised others on stock choices that made them a small fortune; and have enough knowledge to actually try for my broker's exam.

I'm not bragging - well maybe a little :D. I'm simply stating that despite the downturns I've experienced, I am fortunate enough to have gained enough knowledge over time to also have enjoyed some very good years. (My biggest flaw repeatedly being that, instead of saving, I feel so successful that I spend to expand - too quickly.)

It's also easier to listen to me, a strange hybrid between an artist and techno-math geek, than someone like a stock broker or financial analyst, etc. I've been recently poor. I know how hard it is to make do with very little. And yet, I have both book and real experience in gaining wealth. I've come close to that magical million several times. In fact, if not for a few accumulated mistakes, I'd probably be worth 3-4 mil right now. Not stinking wealthy, but comfortable - which is all I really want. (Sure, I once wanted to be a billionaire. Not anymore.)

I also have had the very weird experience of having met a lot of now-famous young people (mostly Canadians, some Americansl) just before they hit it big. Each and every one of them had a specific mindset way back that I can say now, in hindsight, guaranteed that through perserverance, they would eventually "make it".

I can't guarantee you wealth, but I think that you will learn something from here that you don't know about money, wealth, success, and even about perceptions of these most nebulous ideas. Which leads me to my second reason for being so cryptic in my posts: If you have the patience to put up with them, I feel that you'll have enough patience to acquire the wealth. My own personal goal has always been that I want to become a millionaire, through legitimate, honest means, and will take anyone of a like mind along for a ride with me. If that's you, then please stay tuned.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

The Haves and the Have Nots - Sometimes, the Poorest People are the Happiest

We've come to rely on the car… I know that not having a car now for the past 2 years has been very hard on me. I miss all the travelling I did. (Anyone want to make a car donation :? Just kidding.) Except when I'm stuck in traffic, I actually enjoy long drives. I found it exhilarating to drive to unknown places with the music cranked up and the sun roof open.

But when I consider that my car-related monthly expenses were upwards of $1200/month, maybe not having a car isn't such a bad thing. Let's see. That was $560/m for the bad lease agreement, $100+/m for insurance, loads for gasoline, variable amounts for parking, and occasionally as much as $450/m for highway TOLL FEES!! Then there's the repairs, as I'll only drive stickshift vehicles. In fact, I'll only drive Subarus, unless I'm forced to otherwise.

Considering how much money I'm not spending on a vehicle, maybe it's a blessing in disguise. For the money I was spending, I probably could have a bought a house. (But hindsight is 20/20, as they say.) Sure, I have no line of credit, just got out of bankruptcy, have no life insurance (not married), and no mortgage to worry about. I don't have to stress out each month whether or not the mortgage rate is going to change. In general, I'm sort of enjoying a recharging period in my life from all the stress that can come from having been a high earner. You can fall from grace. But then you pick yourself up and start over. Sometimes it takes a while, but situations do change.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

Six Million Dollar Man - The Harder They Fall, The Sooner They Try Again

When my father was still in his teens, shortly before his mother passed away, she took him to a fortune teller. The fortune was that my father would become a great success in a foreign land. These kinds of prophecies usually become self-fulfilling with the right person, someone like my father. But he's had his ups and downs, too. I, too, had my fortune told by several different tellers, all of whom said that I'd become rich and famous. Now consider that East Indian tellers don't all just say that. If they "see" bad things, they say so. They're pretty upfront about what they see.

I can't tell you the number of times I've come close to being a millionaire, but then found myself subconsciously sabotaging my success. Each time, I come closer to that mystical million, but each time I fall even harder. My father, though, made it. At least for a brief period of time. The wealth was all on paper, but through very hard work, he managed to acquire 6 million dollars in real estate, both commercial and residential. Let me clarify. That's actually 6 million in mortgages. But sometimes it's the perceived wealth that matters.

The hardest thing he found, however, was that many people were jealous of his success, not caring how about much toil he put into his "success". Ultimately, their jealousy turned to sabotage, despite my father's generosity about late rents and such, and he finally found himself with a negative cash flow.

While his millionaire status was hard-earned, it didn't last. Eventually, he lost it all. It cost him dearly, in finances and in pride. However, now, at the age of 74, he's picked himself up, brushed himself off, and set about towards that magical million level once again. I admire him for his tenacity. The moral of the story is that no matter how hard life gets, don't give up. Your goals will be realized if you keep your vision and your faith. Anyone who says otherwise either hasn't kept trying or doesn't want you to succeed. Part of success should be the journey as well as the end result.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

Dreams of Financial Grandeur and the Harsh Realities of Spending

It's alright to have dreams of great, financial success, of wealth, of scenic vistas outside your window, but it's even better to set initial achievable goals and work your way towards your financial dreams, in case a little snow falls, obscuring your vision. It's far too easy to get caught up in the media's portrayal of how we should live. People who do marketing are paid to convince you to buy things. I know that this is so obvious I shouldn't have to say it. And yet, credit card debt is at an all time high. The number of personal bankruptcies (compared to the corporate type) is increasing.

Marketers cannot always care whether or not their target buyers can afford to purchase or not, else they'd never convince most people to spend their hard-earned money. So you have to care for yourself. A few dollars not spent now, saved away in a safe money-market fund or high-interest-bearing savings account will pay off later. It's much more satisfactory, in the short term, to spend the money now, and I'm guilty of it as well. But find your own motivation for saving that money, and it will reward you later.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com
 

Building Bridges To Success

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com

Seeing The Financial Forest For The Trees

Sometimes, the greatest favour that you can do for your financial life is to take a long walk through a forest. Things aren't always as they appear. These trees in the above picture look like they've weathered a few storms, but at the first hint of the next Springtime, they're still standing. Your choices are survive or fade away. If you choose to survive, decide on your path, any path, and keep your eye on it.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com
 

The Rich Man/ Poor Man's Financial Wisdom

I've been well-to-do, I've been poor. I've lived from paycheck to paycheck, and I've had so much money I didn't know what to do with it. I've fed others, and I've had to rely on the kindness of others. Like many people, I have a love-hate relationship with money. But unlike most people, I hate it when I have it and love it when I don't. At least, that's what I try to convince myself of. My experience with money has been a rollercoaster ride, leaving me currently in a valley for far longer than I would ever have imagined. But things do eventually change, and money does once again flow through your life. It's the transitional periods that cause the havoc in life, forcing you to adjust your daily routine. This blog talks about these transitional times, as well as various perceptions of money and wealth, and mostly about turning one loaf of bread into several. This isn't your typical blog about money and finances, as I'll be getting deep into the metaphysical aspects of life. Tune in for something that promises to be different.

(c) Copyright 2005-present, Raj Kumar Dash, http://smackeroonies.blogspot.com