50% Money

If you're like most Americans the way to get ahead in life is to go to college, get a good job and in time get pay raises and bonuses. There are some problems with that strategy. Have you noticed that most people don't stay at their job for 20-30 yrs anymore? In fact, many businesses startup and go out of business within 10 yrs. We are in a very different age these days and the old ways our parents taught us regarding money just don't work! For our parents growing up in the industrial age it worked fine to go to school, get a job, work for the same employer for a long, long time and then retire. These days, in the information age, we clearly have to look out for ourselves and our own retirements. Nobody, including the government, is going to take care of us.

If we are going to make a solid plan for our financial future then we have to better understand our own finances. You earn money in at least one of four quadrants; employee, small business owner, big business owner or investor. If you are like most of us you earn 100% of your money as an employee. This is where the 50% money comes in. You see, if you think about it, the government taxes you on your money before you even get your hands on it. It is taxed before you have a chance to pay yourself or pay your bills. Right off the top, taxed. Federal tax, state tax, Medicare, social security, etc. After you get your net income, after tax money, you pay your bills and if you have any left over you might try to save some. Now as if you weren't taxed enough any money that you managed to save you are taxed on the earnings. If you put money into a 401k you are taxed when you withdraw it at retirement. There is gift tax, death tax and the list goes on. What it boils down to is the employee is the most heavily taxed of all the quadrants and this income is considered 50% money because that is about all your going to see of it in the end. It is very hard to get ahead with 50% money.

Now wealthy people have this figured out and that is why they earn their money as big business owners and investors. Small business owners are still getting earned income and all they have done is create a job for themselves instead of an employer doing that for them. A big part of the strategy to go from being broke to being wealthy is figuring out the tax system. Think of it this way; employee 50% money, self employed 50% money, big business owner 20% money, investor 20% and in many cases 0%. Yep, in many cases they pay zero taxes and it is so much easier to get ahead financially if you don't have to pay out 20-50% in taxes!! Also the nice thing about earning money in a business is that the government doesn't tax you on your gross income but on your net income. So you are able to deduct all of your business expenses, and they are many, and then the government taxes you on what's left. Pretty good deal eh?

So really the objective should be to go from the employee quadrant to the business owner and investor quadrants. It's a different mindset and will likely take years but remember "A journey of a thousand miles begins with a single step."

Tired Of The Rat Race?

If you are like most of us you are caught up in the daily grind of work with little or no chance of getting ahead financially. Ever wonder if there is something you can do to fix that? There is ... financial literacy. Financial literacy can be gained in many ways and it is an on-going process. I highly recommend a computer game that will illustrate the process and ultimately help you get out of the Rat Race and on to the Fast Track. The game is called Cashflow 101 the eGame and I'm here to tell you it is worth every penny. I personally play this daily and sometimes for several hours in a day. Why the heck would I put so much time and effort into a computer game??? Like most things, you learn a lot from immersion. You are consistently presented with an income statement and balance sheet and by playing the game you constantly see where to place items within and take items out of their respective areas on the balance sheet. It may sounds a little boring but far from it. I like the eGame because it is at your own pace and you can learn a lot from it. And fundamentally the way you play the game is also the way you need to be doing it in real life. It parallels real life strategies and formulas. And the very basic formula is what we learned as kids playing Monopoly. Buy 4 green houses and trade it in for 1 red hotel.

So if you want to build passive/portfolio income and actually retire one day then this is a must have item! It will change the way you look at money if you play it enough and learn the lessons built into the game. Good luck and have fun !!!

Handmade? What's That??

If you're like most of us when we need something we run to Walmart and buy it. I use Walmart all the time; low cost, always open.. oh yeah. But occasionally, when I actually plan ahead, I prefer to have something that's actually made by hand with a personal touch. My dad used to make a lot of things by hand including knives, wood projects, spurs, leather items, etc.

I recommend checking out Paula's Etsy site. She is a childhood friend and I knew her family when I was growing up. Very good people and believe me when I say a lot of personal time and care goes into these products. Her store has low cost items although the products are labor intensive. Why does she do it then? Because she really, really enjoys it!!

So for items you just can't buy at Walmart you might want to have a look.

Killing Me Softly

I have heard for years that diet drinks are really not all that good for you. But, did you know that it is much worse than that? I personally have been drinking diet coke for a long, long time. I believe for at least 18 yrs. And I get days where I drink a lot of it.

Apparently the real culprit is aspartame. When this artificial sweetener reaches 86 degrees F the wood alcohol in aspartame converts to formaldehyde and then to formic acid. This in turn causes metabolic acidosis or increase in total body acid. The formic acid is a poison that can be found in the sting of fire ants!

So it would seem I personally am running a high and unnecessary risk. I drink this stuff every day and often many cans a day. Yuck!! In fact, I have one sitting in front of me right now that I've been drinking. So if you are one of many that consumes drinks with aspartame you may want to reconsider. I sure as hell am!!

Bionic Man

Yeah, ok, not as impressive as the 6 million dollar man or the bionic woman but still pretty damn cool. Five individually powered fingers, the i-Limb hand is produced by a Scotland firm. Designed to take impulses from the muscles but I believe an implant in the skull is in the works that would relay a signal from the brain. After this war we are going to need solutions for all of the maimed soldiers. I am not sure who is a good candidate for this prosthesis but it looks like a step in the right direction. Any thoughts?

Which Is Which?

Can you tell that only one of these men are human? The other is an android. The day of the robot is coming folks. Three independent articles indicated that within approx. 15 yrs from now 50% of the U.S. households will have a robot in their home. Just as most people scoffed at the computer in the 80's ... here comes the robot.

How Much Does It Cost to be an Airline Pilot

The cost varies a lot but I would figure right at 80k for your degree and all of your flight training. I have personally been to many flight schools both touring them as well as training at many of them. They are not all created equal and by far the better choice is ATP (Airline Transport Professionals). If you are serious about flying for a living then go to ATP. Borrow the money needed and fly your butt off for 5 months. If you don't have a degree yet don't worry about it. ATP will charge you around 46-50k for training and will get you right seat in a jet quick!! The training is tough and full immersion is necessary but you will make it in record time. This is coming from a guy that has been in the industry for 18 yrs now. Believe me I have been suckered by a few but when I discovered ATP that was it!! Good luck to you and let us know how your training is going or any questions you may have.

The Mighty $

Somewhere around 1973 the government began printing money without the gold reserves to back it up. At that point money stopped being money and became a currency. Gold on the other hand is money and currency even today. When we get low on money we just print more of it to cover our debts. Approx. 44% of our nation's debt is to other countries and our spending is out of control. President Bush has spent more money while in office than all of the other U.S. Presidents combined. I don't know about you but I am very concerned about our nation's debt. Any ideas on how to fix it?

Gas Prices

Hmmm.... will the prices continue to climb? Why are the prices climbing? Is this a strategy so that eventually we will look at 3 bucks a gallon and say, wow, that's cheap!! Maybe condition us at 5-6 bucks a gallon for awhile to change our perception a bit. I remember when it was 60-80 cents a gallon, somewhere in there. People growled at the idea of it going over a buck a gallon. Sure the dollar wasn't devalued as badly as it is now but still a big difference don't ya think?

Childhood Memories

Any fond memories from childhood? I used to really enjoy it when the neighbors would visit or we would go visit them. Being on a farm it also meant we didn't have to work if we were visiting so that was good. But I really enjoyed seeing other people for a change and having some fun. What about you? Anything you want to share?

Medicare

There is now more money going out than is going into Medicare. Baby boomers retiring soon so guess what guys... Medicare is likely going bust at some point in the future. If you are around my age or younger I wouldn't expect any help from Medicare in retirement cause there won't be any money.

Mutual Funds Are Risky?

I thought mutual funds were good, safe investments. What the heck are ya talking about? They seem like safe investments and we are always hearing to diversify our portfolio. We turn our hard earned money over to a fund manager and hope all will go well. When the market is up they can do very well but when the market is down they lose more than any other investments. Many people will not be able to retire because they are relying on their 401k and very likely the money they thought they would have will not be there when they need it!

Who The Heck is this Dan Guy Anyway?

Just your average guy out there trying to make a living like most Americans. I have been poor all of my life and just recently joined the ranks of the middle class. By poor I mean my expenses equaled my income and I lived paycheck to paycheck. Now my income is higher than my expenses so I have money to pay expenses and some left over to pay towards liabilities or invest in income generating assets. My ultimate goal is to be wealthy. LOL... I have to laugh because I have never had that goal before until I read the book "Rich Dad, Poor Dad". Ever since then I just keep right on a reading and putting things into action... very cool :)

I spent part of my youth on a farm/ranch in eastern Oregon. I say part because from age 8-15 I had to leave every 6 months to live with the other parent. You can imagine, lots of fun. I like to think I gathered good, useful things from both lives... the country life and the city life. It is my intent to find myself back in the country in my 50's and I'm 42 now.

I have done various jobs in my life. Some of those jobs/industries were logging, fast food, ranching, farming, security officer, loss prevention officer, soldier, vehicle mechanic, tank mechanic, ditch digger, rock remover, medical oxygen driver, manager, dorm resident adviser, founder/CEO of a flight school, mailman, flight instructor, supervisor, airline pilot, etc. Most people would think that is bad, I can't hold a job, etc, etc... But little did I know I was indirectly doing myself a favor and in a sense being groomed for the next stage in my life. The stage, over the next 10 yrs, that will take me into big business ownership (not self employed) and investing. The area that is still lacking is sales experience so I may need to take care of that soon.

So you see I am just your average American guy just trying to get ahead in life. I am always open to discuss different ideas and strategies. Mutual funds are risky investments and social security will not be there when you need it so a financial plan is needed.

I currently live in Phoenix, AZ and teach the art of flying. I flew the ERJ 170 out of Denver, Frontier Express, until May '08 when Frontier went bankrupt. It was really fun flying and I enjoyed that experience a lot!

I have many different hobbies and interests so feel free to drop an email and/or post on my blog. My topics will be varied because after all the realm of discussion is wide open. You can think of the Journey of a Thousand Miles as one peering into a person's life from the beginning to the end. And as with all things in life it is so much richer and has so much more depth when shared with others. So feel free to share your thoughts and ideas!!

Robot Rights?

This sure doesn't look like a robot. If it is a robot it sure doesn't look lethal. This is actually a photo of the armed sentry robot that went on the border of N. Korea last year. It is autonomous and decides all on its own whether or not to shoot someone. If it decides to shoot it can hit its target exactly where it means to ... right between the eyes and dead center in the forehead. What we are seeing is autonomous robots in the infant stages and it is already causing a lot of debate regarding robot rights. You see at this time it is easy to hold people liable, criminally and civilly, for the wrong doing of a robot. For example, if the robot shoots and kills when it wasn't warranted. But in the future, as robots work more and more independent of humans, it will not be so easy to blame anyone but the robot. Therefore, robot rights are necessary. Any thoughts?

A Diamond In The Rough

Or is it? This particular diamond is never in the "rough" so to speak. Apollo Diamonds has mastered the art of the cultured diamond. They grow a flawless diamond in approx. 4 days and currently can grow one up to 2 carats. These are not gemstones and they are not mined but cultured. They are getting funding from the U.S. Army for making high powered lasers and from Intel who plans to replace silicone in their processors with diamond. The need for diamond wafers is high and Apollo is working diligently on perfecting that process. Any comments?