Financial tip of the day

[ecotourist]

Why calculate your net worth? Doing so regularly provides a good measure of how you're doing financially. It's a really simple scorecard.

If your net worth goes up year over year, you're gaining. If it goes down year over year you're losing. And if you keep losing, unless you reduce your spending or raise your income you'll end up broke. [That explanation is generally true but a bit oversimplified because if you own a lot of quality stocks they can still go down in value (reducing your Net Worth) but be back up again in a year or so (raising your Net Worth), so you have to apply a bit of discretion.]

 

[BaronHK]

Why calculate your net worth? Doing so regularly provides a good measure of how you're doing financially. It's a really simple scorecard.

If your net worth goes up year over year, you're gaining. If it goes down year over year you're losing. And if you keep losing, unless you reduce your spending or raise your income you'll end up broke. [That explanation is generally true but a bit oversimplified because if you own a lot of quality stocks they can still go down in value (reducing your Net Worth) but be back up again in a year or so (raising your Net Worth), so you have to apply a bit of discretion.]

It's getting harder to get ahead when the landlord adds 10-12% more for himself every year, and it seems like every time you go to the store, there's 10% less product in the container and they raised the price 15%.

But people who buy a house here tell me what their property tax bill was that they just opened up and that alone is often more than my rent, and that's not even the mortgage, the insurance, the upkeep, everything else. My sister-in-law opened up the property tax bill, it was an outrage, so she hired some stupid lawyer who promised the moon and the stars and went to the PTAB (Property Tax Appeal Board), and they ruled against her and she paid the lawyer too. And the taxes. All of the taxes.

With the dollar rapidly becoming less valuable, even if you manage to have the same amount of "assets" in dollar terms this year as last despite all this, you are still worse off because when you spend it, you won't get much for it.

Years and years of unrelenting inflation breaks people. Economies don't work right anymore.

A friend in Venezuela told me what's probably an image of the future here. "People have closets full of cash that's worth so little it's not worth taking to any bank. If you grabbed the entire closet full you might be able to buy a hotdog from the street vendor."

He also said "We paid De La Rue the equivalent of millions and millions of dollars for security features, and that contract work cost more than the money it got printed on is worth."

The only investment that's been on a tear since late last year is gold, which is booming because people realize what's happening.

It's not just seen as a hedge against inflation. It's now seen as a hedge against the breakdown of the US Dollar. A lot of this demand is in response to Fed rate cuts and is being pursued by various central banks.

So it makes me wonder if...the rest of the world is re-assembling a follow up to what once was Bretton Woods (a system essentially based on gold) that will exist without the US, which ends up with money not worth the paper it's printed on. And I think there's rather a lot of threatening and screaming going on, but that's really not productive against the backdrop of the world economy.

I'm largely investing in AAA investment grade interest-bearing debt and precious metal ETFs.

I think that value in the US stock exchange ETFs that most people have access to in tax advantaged retirement accounts tend to fool them into thinking they have more diversification than they really do. When you go by market capitalization, they've stacked it so that a handful of tech companies are really representing almost half your money, and they've even thrown in meme stocks and valued them like highly respected companies that make profits in some cases. The risk is concentrated in largely a single sector, it's leaving people exposed, and these companies actually stand to lose the most if we get into a peeing match with trade barriers.

It's actually going to be less costly to just transition away from American tech as a reprisal for tariffs than it will be to just keep paying out the nose for it. Some countries had no choice because they were sanctioned, but they're still there. They survived it.

For the American tech sector it will come at the worst time because they're using their profitable business units to heavily subsidize a massive expansion into R&D onto products that are years away from viability, if they ever are.

 

[BaronHK]

A corollary is do not get tax advice off BITOG.com.

I hate the IRS. I've figured out every possible way to make deductions and take credits I'm legally entitled to over the years to minimize my taxation, and I've gotten pretty good at it.

But you also shouldn't get cute with them because they have all the power and from what I've heard being audited is terrible and if they send you to prison, some nights are even worse than others.

I've never been audited, even when I did a couple paper returns in my younger years and mailed them to the Infernal [sic] Revenue Service in Kansas City.

 

[skyactiv]

This thread is in the Humor section and is why I added a silly response or two. Many people on this board like to brag, tell others what to do and point out people are foolish unless they are like mined, not in exact words but its obvious. I'm guilty of it.

 

[BaronHK]

I had to get 2 dozen brown organic yesterday (regular white all gone) and it was over $8.49. I spent at least $2 more than if I had gotten them 1 week ago. I'm so upset I'm not even going to watch the Super Bowl. I know I'm taking it to the extreme but it's all about net worth

I got a dozen for $5.49 this week, brown Eggland's Best. I just buy whichever kind is cheaper. In this case I needed some for baking banana bread and some for scrambled eggs and chorizo one morning to use up some of that after I make arroz con pollo tonight.

Sometimes brown eggs are less depending on what kind of hens they had to slaughter more of due to the bird flu.

What I think will be disastrous for the consumer is when stores go to replace the labels on the physical shelves and they'll adjust all the prices multiple times a day with those stupid digital shelf tags. They said if it's hot outside, the computer will just make things like ice cream and soda more expensive, if it's cold outside the algorithm determines how much more likely you are to buy coffee, tea, and hot chocolate.

When the Super Bowl comes around, it'll automatically raise the price of the snacks people tend to buy, and lower them as soon as the game is over.

Prices are going to turn into this sort of elastic blob that can morph to fit how desperate people are to buy that thing, and there's no disincentive to do it because there won't be any labor costs to change the shelf tag.

One of the best things you can do in response to overall inflation in the economy is to control what you can, including food waste (especially) by eating your leftovers withing the 3 day window after you make them.

My spouse is always complaining that I say "Take that to work." then it's "That's dinner. Get a bowl and hit up the microwave." but it's part of the reason I have plenty of money. I don't do a lot of retail shopping, and much of it is at the thrift store.

Some of the music I listen to in my car is on cassette tape. I have a Walkman and I plugged it into the auxiliary port in my car radio. I don't do streaming. I use the library, I use thrift shops. I can't bring myself to pay and pay over something that's either cheap or I already bought with taxes for the library.

If someone came up with the idea of libraries today, they'd be illegal. They'd be called pirates, socialists, and thieves, but the idea goes way back and as anyone knows, things that are old get authoritative.

 

[Jetronic]

These never counted in your net worth.

But again all such consumables should be offset or you got trouble ahead caused most likely by trouble behind

but buying them lowers your ban account balance, and that lowers your net worth.

 

[Pablo]

but buying them lowers your ban account balance, and that lowers your net worth.

Huh?

Bank?

Think about it this way- how often do you calculate your net worth? And you do have income yes?

 

[Jetronic]

Huh?

Bank?

Think about it this way- how often do you calculate your net worth? And you do have income yes?

I never do, I'd get depressed.

 

[John105]

I got a dozen for $5.49 this week, brown Eggland's Best. I just buy whichever kind is cheaper. In this case I needed some for baking banana bread and some for scrambled eggs and chorizo one morning to use up some of that after I make arroz con pollo tonight.

Sometimes brown eggs are less depending on what kind of hens they had to slaughter more of due to the bird flu.

What I think will be disastrous for the consumer is when stores go to replace the labels on the physical shelves and they'll adjust all the prices multiple times a day with those stupid digital shelf tags. They said if it's hot outside, the computer will just make things like ice cream and soda more expensive, if it's cold outside the algorithm determines how much more likely you are to buy coffee, tea, and hot chocolate.

When the Super Bowl comes around, it'll automatically raise the price of the snacks people tend to buy, and lower them as soon as the game is over.

Prices are going to turn into this sort of elastic blob that can morph to fit how desperate people are to buy that thing, and there's no disincentive to do it because there won't be any labor costs to change the shelf tag.

One of the best things you can do in response to overall inflation in the economy is to control what you can, including food waste (especially) by eating your leftovers withing the 3 day window after you make them.

My spouse is always complaining that I say "Take that to work." then it's "That's dinner. Get a bowl and hit up the microwave." but it's part of the reason I have plenty of money. I don't do a lot of retail shopping, and much of it is at the thrift store.

Some of the music I listen to in my car is on cassette tape. I have a Walkman and I plugged it into the auxiliary port in my car radio. I don't do streaming. I use the library, I use thrift shops. I can't bring myself to pay and pay over something that's either cheap or I already bought with taxes for the library.

If someone came up with the idea of libraries today, they'd be illegal. They'd be called pirates, socialists, and thieves, but the idea goes way back and as anyone knows, things that are old get authoritative.

I think the consumer is easy to trick today with faux sales and somehow it’s not cool to discuss savings. Like chunky soup for $1.25 ea, or limes 5 for $1, or Italian sausage $1.99 lb. I bought these this AM. My son and I go to Shop Rite after the car wash and his 7 am hockey practice. Easy to get hoodwinked and I’m not sure if I’ve seen digital price tags, that will be an effective tool for the retailer…

 

[BaronHK]

I think the consumer is easy to trick today with faux sales and somehow it’s not cool to discuss savings. Like chunky soup for $1.25 ea, or limes 5 for $1, or Italian sausage $1.99 lb. I bought these this AM. My son and I go to Shop Rite after the car wash and his 7 am hockey practice. Easy to get hoodwinked and I’m not sure if I’ve seen digital price tags, that will be an effective tool for the retailer…

I think savings are cool. I know I'm weird like that.

In macro, people are essentially "brainwashed" to avoid savings and to take on all sorts of odious and high interest and unwise debts because of consumer culture, the economy.

Savings are bad for the economy, but they're good for you. When you save you're not causing economic activity this very minute, but you are building a safety net for yourself.

That's important because when people with no savings and lots of debt run into trouble, they end up bankrupt or homeless or something, because their brilliant plan was to run to the unemployment office and get 6 months worth of checks (2 in South Carolina) that are less than minimum wage usually.

So before you do anything *Bill Lumbergh voice* "I want you to ask....'Is this good for my bank account?'"

And the answer is usually no, it's not.

What does debt look like? When you're in debt and have no savings and have payments every month and your boss comes in and starts laying people off. He hasn't gotten to you yet but you think it's coming. Debt is ugly.

When you look at the payment for the car and go "Well, the car only costs $28,000 but since I had no savings [music from The Godfather starts] I had to go ask for a bank loan and now it costs almost $43,000." Debt is ugly.

When you need to buy groceries, and they offer you "Pay in four." and you pay off January's food in April, with interest. Debt is ugly.

Mark Cuban said it best, he said "The worst investment is owing money to a credit card company." because what you're doing is you're giving up tomorrow for something you want today. If you make only the minimum payments (like 11% of people are now doing!) it will take 4.5 years to pay off $20,000 in credit card debt and you'll pay them $35,500. And that's if you cut the card up and pay them $700 a month for 4.5 years on things you already bought which may not have been useful.

The only way credit cards make any sense at all is if you pay the full statement balance off every month and keep the rewards, but the rewards are generous because they're bait. They hope you won't do that. If you drop the ball even for a few months it'll probably obliterate any rewards they ever paid you on that card, and if you make a habit of being in debt, it won't matter at all what the rewards were.

I tell people if you don't trust yourself with a credit card, use a debit card. They make a few debit cards that have rewards. There's a Discover checking account where the debit card brings back 1% in rewards points. It's not terribly lucrative but you can't spend more than you have. There are some people, many people, who have to look at their bank account and go "If I buy this, and subtract from that, OH MY GOD I'LL BE BROKE!" It helps to restore fiscal discipline because it forces you to confront the elephant in the room that this is money, money you worked for, which will be gone right now if you spend it.

The banking sector is one of the biggest components of the economy. It's bigger and more profitable than healthcare. They get rich by financing purchases for people who don't have the discipline to save money and buy things, or who think they won't have to work hard now, but can buy stuff, and quickly find themselves in trouble.

Prices have tended to be stable in Japan's economy, so savings are a lot higher. There's no freaking out and seeing if you can get much for your money when prices haven't moved a whole lot in decades. The United States Dollar is being severely devalued currently and it's unclear when it will end, but the high inflation unfortunately "subsidizes debt". It creates a moral hazard because no savings still means no security.

We get by fine with credit card reward schemes because my brain is wired differently than most of the people I know. I am very frugal and I didn't change my spending patterns and I remain cognizant of my spending. And the credit cards, for me are, "How do I say no to 6% back on groceries, 5% at restaurants, 5% on gas, 3% overall?" Well, it's hard. It's a passive revenue stream that nobody even charges taxes on.

So I like money, that I didn't have to do anything for, that I don't have to pay income tax on. How often do you get that deal? The St. Louis Fed studied credit card rewards. They're basically socialism for the rich and upper middle class. The way it works is they come out of credit card slide fees and the interest other people pay. (Mostly....some have annual fees that help the bank offset, and some won't use the full value of the main benefit of the card.) So people who pay cash or pay an annual fee then don't get the full value realization of the card, or end up paying interest, will end up subsidizing people who the bank loses some money on.

It's a bad system. It should end. There have been rounds and rounds of debate over whether it's fair, and I don't think it's fair, but it's become a fixture and you can basically take it or leave it. I prefer to buttress my savings and invest them.

 

[Paco Pena]

I used to buy a used car and drive it until it was worth a $1000 , sell it and repeat. Worked for me.

Paco

 

[John105]

I think savings are cool. I know I'm weird like that.

In macro, people are essentially "brainwashed" to avoid savings and to take on all sorts of odious and high interest and unwise debts because of consumer culture, the economy.

Savings are bad for the economy, but they're good for you. When you save you're not causing economic activity this very minute, but you are building a safety net for yourself.

That's important because when people with no savings and lots of debt run into trouble, they end up bankrupt or homeless or something, because their brilliant plan was to run to the unemployment office and get 6 months worth of checks (2 in South Carolina) that are less than minimum wage usually.

So before you do anything *Bill Lumbergh voice* "I want you to ask....'Is this good for my bank account?'"

And the answer is usually no, it's not.

What does debt look like? When you're in debt and have no savings and have payments every month and your boss comes in and starts laying people off. He hasn't gotten to you yet but you think it's coming. Debt is ugly.

When you look at the payment for the car and go "Well, the car only costs $28,000 but since I had no savings [music from The Godfather starts] I had to go ask for a bank loan and now it costs almost $43,000." Debt is ugly.

When you need to buy groceries, and they offer you "Pay in four." and you pay off January's food in April, with interest. Debt is ugly.

Mark Cuban said it best, he said "The worst investment is owing money to a credit card company." because what you're doing is you're giving up tomorrow for something you want today. If you make only the minimum payments (like 11% of people are now doing!) it will take 4.5 years to pay off $20,000 in credit card debt and you'll pay them $35,500. And that's if you cut the card up and pay them $700 a month for 4.5 years on things you already bought which may not have been useful.

The only way credit cards make any sense at all is if you pay the full statement balance off every month and keep the rewards, but the rewards are generous because they're bait. They hope you won't do that. If you drop the ball even for a few months it'll probably obliterate any rewards they ever paid you on that card, and if you make a habit of being in debt, it won't matter at all what the rewards were.

I tell people if you don't trust yourself with a credit card, use a debit card. They make a few debit cards that have rewards. There's a Discover checking account where the debit card brings back 1% in rewards points. It's not terribly lucrative but you can't spend more than you have. There are some people, many people, who have to look at their bank account and go "If I buy this, and subtract from that, OH MY GOD I'LL BE BROKE!" It helps to restore fiscal discipline because it forces you to confront the elephant in the room that this is money, money you worked for, which will be gone right now if you spend it.

The banking sector is one of the biggest components of the economy. It's bigger and more profitable than healthcare. They get rich by financing purchases for people who don't have the discipline to save money and buy things, or who think they won't have to work hard now, but can buy stuff, and quickly find themselves in trouble.

Prices have tended to be stable in Japan's economy, so savings are a lot higher. There's no freaking out and seeing if you can get much for your money when prices haven't moved a whole lot in decades. The United States Dollar is being severely devalued currently and it's unclear when it will end, but the high inflation unfortunately "subsidizes debt". It creates a moral hazard because no savings still means no security.

We get by fine with credit card reward schemes because my brain is wired differently than most of the people I know. I am very frugal and I didn't change my spending patterns and I remain cognizant of my spending. And the credit cards, for me are, "How do I say no to 6% back on groceries, 5% at restaurants, 5% on gas, 3% overall?" Well, it's hard. It's a passive revenue stream that nobody even charges taxes on.

So I like money, that I didn't have to do anything for, that I don't have to pay income tax on. How often do you get that deal? The St. Louis Fed studied credit card rewards. They're basically socialism for the rich and upper middle class. The way it works is they come out of credit card slide fees and the interest other people pay. (Mostly....some have annual fees that help the bank offset, and some won't use the full value of the main benefit of the card.) So people who pay cash or pay an annual fee then don't get the full value realization of the card, or end up paying interest, will end up subsidizing people who the bank loses some money on.

It's a bad system. It should end. There have been rounds and rounds of debate over whether it's fair, and I don't think it's fair, but it's become a fixture and you can basically take it or leave it. I prefer to buttress my savings and invest them.

I never thought about rewards that way and it’s interesting. Imho working from home is the same. My buddy got hired as a hybrid worker and in 4.5 years he’s been in the office 3 times. Routinely doing work on his home, shopping, kids’ appointments, and the kicker, looking for a second six figure full time job since he has let’s say as little as 2 or as many as 7 free hours every work day. I told him 20 years ago you do so much as 1/2 hour on a consulting side gig you’re fired, and you’re looking for another job to do on co time. He told me I’m a hater and we simply don’t see things the same way. So I say wfh is this middle upper middle class activity as well. Whereas the lower class and working class have to physically show up and perform work. Interestingly with all that income my buddy has zero savings. Maybe it’s mentality dunno so working 1-3 hours a day possibly creates other problems

 

[BaronHK]

I never thought about rewards that way and it’s interesting. Imho working from home is the same. My buddy got hired as a hybrid worker and in 4.5 years he’s been in the office 3 times. Routinely doing work on his home, shopping, kids’ appointments, and the kicker, looking for a second six figure full time job since he has let’s say as little as 2 or as many as 7 free hours every work day. I told him 20 years ago you do so much as 1/2 hour on a consulting side gig you’re fired, and you’re looking for another job to do on co time. He told me I’m a hater and we simply don’t see things the same way. So I say wfh is this middle upper middle class activity as well. Whereas the lower class and working class have to physically show up and perform work. Interestingly with all that income my buddy has zero savings. Maybe it’s mentality dunno so working 1-3 hours a day possibly creates other problems

Well, office space in Chicago is more expensive than assuming employees might goof off but choosing to disregard if they get their work done.

Many offices that shut down in the region during COVID never reopened. Maybe half did. There's a huge problem in commercial real estate right now and I'm surprised nobody is talking about it much.

The problem is the management. They try to measure employee productivity by how much time they spend on Microsoft Teams or something. Microsoft came up with this "productivity score" that can be very high when nothing of value is getting done.

Basically with money, you need to do three things:

Earn it. Keep other people's hands off of it as much as possible. Invest.

(This means getting mean and frugal. Even in stupid ways that other people laugh at sometimes.) I had the toothpaste argument with my spouse. The $7 tube or the $1 tube. It's grit with fluoride. They're testing you.

I started using a safety razor and buying blades by the hundreds. I only use kitchen trash bags for gross trash. I use those big Jewel reusable ones that bring me tons of for clean trash. I cut my own hair. I wash my own car whenever the weather possibly permits it.

I have an empty plastic cat litter bucket I rinsed out thoroughly for soapy water, and a few for rinse water, and car wash mitts and drying towels, and a battery powered pressure washer that doesn't need a hose. I avoided going to the laundromat and busting out rolls of quarters by gettin a 0.9 cu. foot portable washer and double straining the wastewater for lint.

I mean, I pinch pennies so hard they scream. I used to be poor. Being poor sucks. It's not just about a wallet full of credit card points, it's shopping sales, using coupons, eating your leftovers and not wasting food.

You know what makes me mad? They think we're freaking stupid. Corporate America thinks we're freaking dumb. Like get this. Liquid hand soap. It cleans your hands. It moisturizes them, it's got all the same ingredients as body wash. But you get three times as much of it for $1 less per bottle. I had to have another "slight argument" when my spouse noticed no "body wash". I said "Oh, so you can wash your hands with hand soap but not your armpits, feet, and butt, right?" I wash my hair in the stuff too. I have great hair, I don't need anything special. Shampoo is $6 or more, why? I use a hand mirror in the shower and just wet shave, with the hand soap.

They say men have no "life skills". No, I'm not stupid. I'm not spending another $30 a month I don't need to on an assortment of products.

My spouse started bringing home that Dawn Powerwash spray. So I bought a ton of them for about a buck each with coupons when they were promoting them then grabbed all the empty bottles and started refilling them with a squirt of dish soap, some rubbing alcohol, and (mostly) water. Spouse has not noticed. These things are $4 each for refills so they can sell you a squirt of dish soap.

I don't have any debt. If all our income stopped right now and we didn't even get unemployment checks, we could live for over three years at our current rate of spending. If we pulled the 401(k) (not something you want to do), we'd last another 5-6 years I think.

Experts suggest a 6 month emergency fund. But I say you need to anticipate what's the worst thing that could happen, plan for that. Plan for unemployment and all sorts of disasters happening at once. The worst thing that happens is you park it in conservative investments and it gets bigger.

 

[ATex7239]

What’s the point in having money if you’re just going to enjoy yourself with it. Better off hoarding it so you can just sit there and stare at it all day. Now you’re thinking.

 

[BaronHK]

What’s the point in having money if you’re just going to enjoy yourself with it. Better off hoarding it so you can just sit there and stare at it all day. Now you’re thinking.

Cash hoarding would be like if I had billions of dollars and was living in a $50,000 house and driving a 2006 Cadillac.

Oh wait, that's Warren Buffett. Did you know the only reason one of the richest men in the world got rid of a 16 year old Cadillac (when he got rid of it) was because his daughter said it was "embarrassing" for him to drive a 2006 Cadillac?

He went and bought a new one with Mary Barra in tow.

Anyway, my point is that rich people are actually famously stingy with money. Bill Gates wears a wrist watch that costs about $30. He's not flashing around a $50,000 watch, although he wouldn't even miss it.

It's bad financial habits that wreak havoc on people, of modest means especially, but many more than that if they're not careful.

Every dollar has a job. Every dollar must be spent efficiently. Every dollar that doesn't have a job can go over into the corner and compound for me so it reproduces and makes new dollars, mostly off the dumb car loans and credit card debts that the bank uses the money for.

It's not like I walk in with a whip and say "No vacations! *smack* Ever!!!!" I don't fly. I just rent a car with unlimited miles and take a few extra days. I hate flying. I hate the people who get on the plane with me and fart on me and give me a respiratory infection.

Imagine the horror when I was on the commuter train one day and they had track repairs going on, and I got stuck sitting behind Robert C****e. Who is Robert C****e? Well, he was the guy with the cell phone that called the airport saying he was Robert C****e and he'd be late because he didn't read the travel notice and would they please delay the flight an hour for everyone else. He is Robert C****e after all.

When I got back home I was sick for the next month with COVID. Thanks to Robert C****e.

I prefer driving because of the whole personal space bubble. You never get people who fart on you and give you the flu, or kids that kick the back of the seat the whole 4 hours, or Robert C****e who thinks they're going to delay a takeoff because he's him.

 

[ATex7239]

Cash hoarding would be like if I had billions of dollars and was living in a $50,000 house and driving a 2006 Cadillac.

Oh wait, that's Warren Buffett. Did you know the only reason one of the richest men in the world got rid of a 16 year old Cadillac (when he got rid of it) was because his daughter said it was "embarrassing" for him to drive a 2006 Cadillac?

He went and bought a new one with Mary Barra in tow.

Anyway, my point is that rich people are actually famously stingy with money. Bill Gates wears a wrist watch that costs about $30. He's not flashing around a $50,000 watch, although he wouldn't even miss it.

It's bad financial habits that wreak havoc on people, of modest means especially, but many more than that if they're not careful.

Every dollar has a job. Every dollar must be spent efficiently. Every dollar that doesn't have a job can go over into the corner and compound for me so it reproduces and makes new dollars, mostly off the dumb car loans and credit card debts that the bank uses the money for.

It's not like I walk in with a whip and say "No vacations! *smack* Ever!!!!" I don't fly. I just rent a car with unlimited miles and take a few extra days. I hate flying. I hate the people who get on the plane with me and fart on me and give me a respiratory infection.

Imagine the horror when I was on the commuter train one day and they had track repairs going on, and I got stuck sitting behind Robert C****e. Who is Robert C****e? Well, he was the guy with the cell phone that called the airport saying he was Robert C****e and he'd be late because he didn't read the travel notice and would they please delay the flight an hour for everyone else. He is Robert C****e after all.

When I got back home I was sick for the next month with COVID. Thanks to Robert C****e.

I prefer driving because of the whole personal space bubble. You never get people who fart on you and give you the flu, or kids that kick the back of the seat the whole 4 hours, or Robert C****e who thinks they're going to delay a takeoff because he's him.

BITOG: where others people’s money is none of your business. Unless you disagree with their choices.

 

[BaronHK]

BITOG: where others people’s money is none of your business. Unless you disagree with their choices.

I like reading about what rich people do with their money. Although I would never ever own a luxury car, Steve Jobs always loved to own a Porsche as his daily driver. A 911 iirc. This was in the 1980s.

He got forced out of Apple and replaced by a former Pepsi executive who nearly bankrupted Apple. Seriously, Apple was worthless in the 90s and almost failed. It took a humiliating bailout that Steve Jobs had to practically beg Bill Gates for in exchange for huge concessions.

But in the interim, he was the CEO of a company called NeXT which made UNIX workstations, which at that time I'm sure you know were incredibly expensive and had little use outside of government, business, and universities.

H. Ross Perot (yes, the Independent Presidential Candidate in 1992 and 1996), was considering investing $20 million dollars in NeXT and he did, in exchange for a seat on the Board of Directors.

He announced that he wanted to visit on short notice, and Steve Jobs and several other executives that had a Porsche or another expensive car drove theirs to work that morning thinking nothing of it. They were wearing (in some cases) expensive watches, all kinds of things really.

So Steve Jobs flew through the office, as fast as he could, screaming "Hide the Porsches!" basically, and he had to stop and explain who Ross Perot was and why this was important, so the Porsches all got parked somewhere else, the expensive watches came off, and Jobs changed from his suit to a t-shirt and a pair of jeans.

Jobs and the rest probably didn't have the resources at that point to make all that stuff a good idea, but they bought it anyway, but they were at least smart enough to hide it and look humble in front of an investor.

Why? "I don't want [Ross Perot] to know we have this much money!"

Jobs understood perception management. It's true that people who look rich get worse deals. He wanted to send the image of an upstart company that was struggling with cash to help him secure financing. If Perot walked in and saw Porsches, gold Rolex watches, and expensive suits, then he may have concluded that they didn't need that investment.

NeXT's operating system became the base of all the Apple products in use today, from Mac OS, to iOS, to Watch OS.

John Sculley, the guy from Pepsi, got fired. Almost nobody even remembers now how bad Apple's products were during Sculley's stint at the company, or how he cheapened the brand by licensing cloned firmware to run licensed Mac OS on third party systems that suffered from poor and uneven design. Or his other failures like the Newton or the Pippin.

I'd go so far as to say that this is what happens when a person's primary qualification is a business degree. They come in, they have no understanding of what anyone does at this company. They think they do but it's like one of those "bad lip reading" videos on YouTube, and they look to extract "value" and make all sorts of horrible decisions.

Perception Management, is humorous. People with Business degrees are humorous.

Dave Ramsey has made a career out of explaining how to become an every day millionaire. He said if you're trying to become a billionaire, that involves debt and risk and he said his goal is to create people who are millionaires and secure a comfortable and dignified retirement, not people who go broke 6-7 times trying to become billionaires.

And if you listen to what he tells you to do, you will probably go from negative or zero net worth to tens of thousands, then hundreds of thousands, then millions. And although he doesn't advise people not to buy a home, he's been careful to say you need to be able to afford the payments without it breaking you and not go longer than 15 years on the mortgage. If you can't do this, don't even try.

My mom spent most of her life making good money, she made terrible decisions on where it went. Decisions that were hers and hers to make, and she now has 72 cents to her name, and owes several thousand dollars in credit card debt.

I could pay it all off for her but I'm not going to. I could pay it all off with less than 3% of what I have, but I won't.

After she spent years trash talking me, and looking down her nose at me, and not taking any advice I gave her, what would be the point?

She filed bankruptcy and the foreclosed mortgages, credit cards, and buy here pay here car went away and it all reset to zero, and within a year she was in debt up to her eyeballs again. If I paid off her debt, she'd just rack up new debt, and that's not a cycle I dig. If she didn't learn anything from being branded as a bankrupt and being sent on her way, she wouldn't learn anything from me. Something given has no value.

She gives me "advice". I don't ever take it. Dave Ramsey said if someone offering you financial advice is broke, that's like having a shop teacher with missing fingers. Be careful about anything they tell you.

Sophisticated people who use debt (there are some) do not use their FICO score to buy a $60,000 car when they have 60 cents in the bank.

 

[ATex7239]

I like reading about what rich people do with their money. Although I would never ever own a luxury car, Steve Jobs always loved to own a Porsche as his daily driver. A 911 iirc. This was in the 1980s.

He got forced out of Apple and replaced by a former Pepsi executive who nearly bankrupted Apple. Seriously, Apple was worthless in the 90s and almost failed. It took a humiliating bailout that Steve Jobs had to practically beg Bill Gates for in exchange for huge concessions.

But in the interim, he was the CEO of a company called NeXT which made UNIX workstations, which at that time I'm sure you know were incredibly expensive and had little use outside of government, business, and universities.

H. Ross Perot (yes, the Independent Presidential Candidate in 1992 and 1996), was considering investing $20 million dollars in NeXT and he did, in exchange for a seat on the Board of Directors.

He announced that he wanted to visit on short notice, and Steve Jobs and several other executives that had a Porsche or another expensive car drove theirs to work that morning thinking nothing of it. They were wearing (in some cases) expensive watches, all kinds of things really.

So Steve Jobs flew through the office, as fast as he could, screaming "Hide the Porsches!" basically, and he had to stop and explain who Ross Perot was and why this was important, so the Porsches all got parked somewhere else, the expensive watches came off, and Jobs changed from his suit to a t-shirt and a pair of jeans.

Jobs and the rest probably didn't have the resources at that point to make all that stuff a good idea, but they bought it anyway, but they were at least smart enough to hide it and look humble in front of an investor.

Why? "I don't want [Ross Perot] to know we have this much money!"

Jobs understood perception management. It's true that people who look rich get worse deals. He wanted to send the image of an upstart company that was struggling with cash to help him secure financing. If Perot walked in and saw Porsches, gold Rolex watches, and expensive suits, then he may have concluded that they didn't need that investment.

NeXT's operating system became the base of all the Apple products in use today, from Mac OS, to iOS, to Watch OS.

John Sculley, the guy from Pepsi, got fired. Almost nobody even remembers now how bad Apple's products were during Sculley's stint at the company, or how he cheapened the brand by licensing cloned firmware to run licensed Mac OS on third party systems that suffered from poor and uneven design. Or his other failures like the Newton or the Pippin.

I'd go so far as to say that this is what happens when a person's primary qualification is a business degree. They come in, they have no understanding of what anyone does at this company. They think they do but it's like one of those "bad lip reading" videos on YouTube, and they look to extract "value" and make all sorts of horrible decisions.

Perception Management, is humorous. People with Business degrees are humorous.

Dave Ramsey has made a career out of explaining how to become an every day millionaire. He said if you're trying to become a billionaire, that involves debt and risk and he said his goal is to create people who are millionaires and secure a comfortable and dignified retirement, not people who go broke 6-7 times trying to become billionaires.

And if you listen to what he tells you to do, you will probably go from negative or zero net worth to tens of thousands, then hundreds of thousands, then millions. And although he doesn't advise people not to buy a home, he's been careful to say you need to be able to afford the payments without it breaking you and not go longer than 15 years on the mortgage. If you can't do this, don't even try.

My mom spent most of her life making good money, she made terrible decisions on where it went. Decisions that were hers and hers to make, and she now has 72 cents to her name, and owes several thousand dollars in credit card debt.

I could pay it all off for her but I'm not going to. I could pay it all off with less than 3% of what I have, but I won't.

After she spent years trash talking me, and looking down her nose at me, and not taking any advice I gave her, what would be the point?

She filed bankruptcy and the foreclosed mortgages, credit cards, and buy here pay here car went away and it all reset to zero, and within a year she was in debt up to her eyeballs again. If I paid off her debt, she'd just rack up new debt, and that's not a cycle I dig. If she didn't learn anything from being branded as a bankrupt and being sent on her way, she wouldn't learn anything from me. Something given has no value.

She gives me "advice". I don't ever take it. Dave Ramsey said if someone offering you financial advice is broke, that's like having a shop teacher with missing fingers. Be careful about anything they tell you.

Sophisticated people who use debt (there are some) do not use their FICO score to buy a $60,000 car when they have 60 cents in the bank.

TL;DR.

This is the humor section people who take it seriously should be tarred and feathered.

 

[BaronHK]

TL;DR.

This is the humor section people who take it seriously should be tarred and feathered.

I think it is humorous that people who drove nice cars and had Rolex watches were moving like greased lightning in a blind panic to hide it all when an investor was coming.

Most people who don't understand perception management think you rush to flaunt the (appearance) of wealth, or "fake it til you make it".

 

[TimeFlies]

After years of knowing many really rich people, I've learned that the truly rich don't brag about their wealth. The braggers, are not truly rich, but want to pretend they are. My last boss is rich, I mean truly rich, but he never ever acted rich like most people would assume that he may. But he could write a cheque for 10 million dollars and it was absolutely nothing to him. His bedroom is larger than most peoples homes, and wow what a house, but he only says humbly, ya its an okay place to hang my hat after work. When his son got married, his wedding gift to them was a 6 million dollar home. But he works hard 12 hours a day minimum, wears dirty old jeans, and sure doesn't play rich guy.