WealthBlog.net

 Just heard a great podcast I wanted to share with you.  In case you hadn’t yet noticed, the global economy isn’t doing so great.  People are watching their 401(k) and IRA accounts lose 40% or more of their value.  If you’re a “hard money” person, you’re not surprised by this economic crisis.  Paper money and flim flam stocks are only part of the problem.  How do you protect yourself against economic disaster and inflation?  Buy gold.  Gold has proven over time to be one of the best assets to own in order to preserve wealth.  Listen to Lew Rockwell interview Burt Blumert of Camino Coin.  Burt shares some tips on how to get started buying gold.

 If you’re just starting out on your path to wealth, every dollar you can save helps.  That’s why there’s no excuse for continuing to throw away your money for cable or Dish TV.  Unless you simply must have access to the dreck being pumped out by the cable news networks, MTV, Oxygen, a million sports channels, etc, you can instantly start saving close to $1000 per year (not to mention the cost of a new HDTV…). How?  Here’s how:

1.  Hulu
2. Netflix (the cheapskate plan - $8.99)
3. ABC.com and CBS.com 

With these three websites, you can enjoy endless hours of free entertainment (minus the cost of your monthly ISP bill and Netflix subscription).  We watch movies on our 24″ iMac (near HD-quality with some content on Hulu) and that’s $75 less that we’re handing over to Time Warner every month.  If you really think that you can’t live without cable TV, you’re probably not ready to be serious about building wealth.  When you’re just starting out, it takes sacrifices, something that should be all the more apparent in this economy.Cancel the cable or satellite service, sell your TV on craigslist and instantly give yourself a $1000 a year raise. 

I have a rule about “stuff” in my home:  If it’s not being used, it’s creating clutter and potentially tying up money.  So every 6 months or so, I try to set aside a Saturday to do an audit of my stuff.  I go through closets, my desk, the garage, and put unused stuff I find into two groups.  Group A is for stuff that will never or rarely be used but might have some monetary value.  Group B is for stuff that I never use and likely never will, that has virtually no monetary value.  Once I have identified all my unused stuff, I make a complete “manifest” for each group, a list itemizing everything.  Then on my list for the items in Group A, I add two columns next to the item description:  “Potential Value” and “Channel”.  In the Potential Value column, I write down a dollar range that I think each item can realistically fetch from a buyer.  (The key word here is “realistic”.  Don’t be wildly optimistic; the goal here is to reduce clutter and become more efficient.) 

In the Channel column, I write down where the best place would be to market/sell the item, e.g. Craigslist, eBay, Amazon, LiveDeal, etc.Next, add up the value ranges in your Potential Value column to get a range for what you might make by selling these items.  For anything you plan to sell on eBay, LiveDeal or Amazon, deduct 15% from that item’s potential value to account for listing and transaction fees.  Next, prioritize your list from most expensive item to least expensive, and begin the process of listing the items for sale in your chosen channels.For Group B items, I usually make a trip to the Salvation Army to donate the items in good working condition.  You get to help a good cause and also get the added benefit of a tax deduction.  You can also simply list everything in Group B on Craigslist in the “Free Stuff” category, but in my experience you will get a lot of strange people coming to your door.

Some highlights of my last audit include:  An unused G4 Mac Powerbook with a messed up hinge, about 15 DVDs, and a collection of 20 books I was never going to read again.  My total net gain from this audit was just shy of $900.  Not bad for one Saturday. 

The 2008 stimulus package puts up to $1,500 (married, filing jointly with dependents) in your pocket if you file a return.  If you’re wondering (like I was) when you can expect to get your stimulus, it all depends on two factors:

1.  Whether you are opted for Direct Deposit or not
2. What the last two digits of your social security number are

If you chose the Direct Deposit option you’ll probably get your stimulus faster.  You can use this IRS page to see when your check is scheduled to get mailed out.

Ever since I was first introduced to the wonders of compound interest, I’ve enjoyed fantasizing about future account values by plugging in theoretical lump sums, annual additions and return percentages.  It’s always reassuring to use very conservative values when playing with theoretical money; even a small amount of money put away at a 7% return with a modest annual addition adds up to some serious retirement cash.  Starting with $12,000 and adding just $1,000 consistently every month for 30 years, you’d be able to quit working with $1.3 Million in the bank and live comfortably off the interest.  Of course, no one knows for sure what the future holds, and if inflation continues to be a problem or get worse, 7% real returns could themselves become a fantasy.

Even though the advice contained in Ben Franklin’s ‘Poor Richard’ chronicles is more than 250 years old, it remains relevant even in the 21st century.  Sound money principles for personal finance are still not followed by the vast majority of people–the current credit crisis is a perfect proof point.  Instead of filling schoolchildren’s young minds with dire global warming predictions, perhaps a better alternative would be to make ‘Poor Richard’s’ mandatory reading.  Here are a few of my favorite lines:

•  ”Industry pays debts; Despair increases them.”
• “If you’d be wealthy, think of saving, more than of getting.”
• Wealth is not his that has it, but his that enjoys it.” 

 You can read more here.

After spending the last three years going from earning $0 to $250+ per day from my off-the-clock efforts, I figured it was time for me to start sharing some of the strategies, techniques and tools I have used and evaluated to build a full-time passive income and slowly build wealth for my future.  I will discuss general wealth-building strategies, ideas and techniques as well as specific advice for building passive income from legitimate (i.e. non-scheme, affiliate program, etc) sources.  Stay tuned.