Wealth creation tips.

Discussion in 'Et Cetera, Et Cetera' started by The Dragon, Jun 20, 2008.

  1. The Dragon

    The Dragon New Member

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    To those who deal with investments.
    Have you ever had a tip, mentor or book that has really worked in the market place?
    Starting out investing can be a daunting place to be and while there is lots of advice and self help books on the subject there seems to be a very real dirth of "how to" that really work.
    I encourage others who have had experience in these matters to use this thread to share the advice that WORKED and helped them.

    Three books that helped me the most are -
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    Buffettology - written by Mary Buffett.

    It gives detalied analysis of HOW Buffett commits capital to investment from a business perpective, the strategy and most important of all the mathematical equations to workout a companies Intrinsic worth and what is the correct price to pay for the stock using nothing more than a common hand held calculator.

    The step by step instructions and the equations in this book work.
    It is written in plain english with very little jargon.
    This book is one of my most prized posessions.
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    The whole series of Robert Kiyosaki's books.

    Straight forward.
    Once again written in plain english and I found they dovetail in well with the concepts in Buffettology.
    Covers alot of ground that Buttettology doesn't like property investments and Start up finance.
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    Your Mortgage and how to pay it off in five years by someone who done it in three - Anita Bell.

    Gets down to the nitty gritty of househould expenses and personal dept reduction without heartache.

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    Tips-
    # Get the very best proffesional help you can afford e.g - Lawyers, accountants all of whom specialize in finance, company law and taxation.
    Remember it is Tax minimisation, Not Tax avoidance.
    Pay these people well.
    My team Do not make mistakes, they are the very best in their feild and I pay them above their hourly rate.

    # Don't cling to deals.
    Know when t walk away.
    Never feel like You have to make a deal work.
    There are always good profitable projects that need money.
     
  2. vince

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    Those are good tips Dragonfly. Number 2 is difficult to learn, but my rule of thumb is that after analyzing the numbers and I'm not sure, if my gut says no, then I don't accept the deal. Saying no, especially to people more financially powerful than me, has been the best thing I learned. You'd be surprised how often they come back and sweeten the pot.

    For example. Two years ago a well known, but aggressive potential client approached us to do a medium size project. He thought we were desperate for the job (which we were, kind of) and offered to pay a price that was only break even. We negotiated, but he still would not let us make a reasonable profit. I just said sorry, no. Six months later, we met socially and he took me aside and we made a reasonable deal. Since then we have done another bigger project for him and are about to sign for three more.

    The point is don't let them push you around and don't get pressured into a deal you are uncomfortable with.
     
  3. jason_els

    jason_els <img border="0" src="/images/badges/gold_member.gi

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    Meh, a good printer, a big basement, and the right rag paper is all you need.
     
  4. Wyldgusechaz

    Wyldgusechaz New Member

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    The new James Cramer book is pretty good. It's commonsense stuff that we should all know but we forget.

    My thoughts: Start young and start buying good quality stocks. In 2003 ExxonMobil was $30/share. If you could have found $3K and bought 100 shares, you would have had 5 years of dividends and now the stock is $90. Was it any sort of reach to imagine Exxon to not go up in value back then?

    Buy low, sell high. Brainless, eh? But thats the truth. Stocks are falling right now. If you can afford to get into the stock market, there is really no better time than when the market is falling as it is now. Citibank is at $20 now. Its been as high as $60 recently. Are the odds greater that it will fall to $0 or climb to $40 again? It may take 2 years, but I think $40 is doable.

    Real estate is hands on and hard work. I own tons of dollars of real estate, good quality stuff and it still can be a fucking roller coaster of harrowing ups and downs. Rich Dad, Poor Dad is ok but its not nearly as easy as he says it is or he wouldn't be in the book business. :biggrin1:

    $10 stocks are usually shit. Their initial public offering was likely higher than that. Why did it fall below its opening day price? Cause its shit. You could find a gem but not likely.

    Just open an online account today. Its easy. Scotttrade, optionsexpress, Schwab. Put $100 in monthly, and start small. While you are in your 20's. Buy 50 shares of Citibank. Then buy 20 shares of something else. Caterpillar Tractor maybe.

    Then if you have any spare money left over, spend it on yourself like a drunken sailor. And NEVER feel bad about spending it. Splurge if you can. You did the right thing first, by buying some small chunk of stock, now its time to play.
     
  5. mista geechee

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    1. Don't invest in anything you don't understand.

    2. You don't have to have a doctorate in fincance or investing or accounting or anything related to have complete knowledge of it. Pick up an encyclopedia and read about it yourself. That way you can better understand the multi-faceted business world. You will also be able to better understand hte double-speak used by "insiders". Homeboy from Mad Money on CNBC is ok though. Jim or James Cramer? You should also learn about world market and not jus the market in your country.
     
  6. AlteredEgo

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    dragonfly, I really like you. I'm glad you started this thread, and I hope it will fill up with useful information. I own (but have not yet read Buffetology), and I will look for the mortgage book you recommended because Hades and I will be buying a house in three years, and because whatever methods work for a mortgage will surely apply to my student loan.

    My grandmothers both paid of their mortgages in under 10 years. One of them did this as a single parent. They both say:


    1. Ignore interest and pay the principle.
    2. Find a loan with no penalties for early repayment.
    3. Even if you are ahead of your debt always pay at least what would have been the minimum monthly payment.
    4. If for some reason you are going to have a problem making a payment, contact your lender immediately. Do not wait for them to contact you. Something can often be worked out.
    5. Whenever possible, buy property with room for a tenant.
    I have also read all of Robert Kiyosaki's books, and most of his affiliates' books. One thing I'm about to try from advice therein is to live off of one income, and save the other. I'm moving in with Hades in a few weeks. When I find work in my new city, we will be living off of whichever is smaller of our two incomes. (We're hoping it will be his.) With the other income, we will pay off his credit card, my student loans, and (after trading in BOTH of our cars) buy one new (more fuel efficient) car . When we are married, he will be dropped from the insurance policy, and it will become my car. He can be legally covered by my insurance as my spouse, and I am far more cheaply insured than he is. I've digressed. Free of debt, and after a very inexpensive wedding, we will save the larger of our incomes in its entirety and invest in real estate.

    Anyway, great thread. I hope it garners responses. A revolution is coming, and I fear that though they are outnumbered, the wealthy will win.
     
  7. D_Bob_Crotchitch

    D_Bob_Crotchitch New Member

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    Learn the basics before you invest even one dime. Read good basic books like Personal Finance For Dummies, Investing For Dummies, and start reading the financial websites like Money, Yahoo Finance, Marketwatch.com. Learn before you get burned.
     
  8. AlteredEgo

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    I have The Complete Idiot's Guide to Personal Finance in your 20's & 30's. It's boring as hell, but it's helping.
     
  9. The Dragon

    The Dragon New Member

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    Every time I start a new project I do it under the name of a $800 "shelf company".
    These (in Australia) are pre-named legal entities that can be brought through accountants.
    All funds for the project and all business for the project are done in the shelf companies and business numbers name.
    This is done for legal reasons in case one of my contractors falls off a scafolding or gets run over by a cement truck they can only sue me for and take the assets held by the company.( Australian Law)
    It quarantines all my other assets held in diffrent companies names.

    I live by the 1/3-1/3-1/3 rule..but with a twist.
    I have a trust fund so instead of the 1/3 to principle, 1/3 to live on and 1/3 to charity(taxation purposes)
    I live by 1/3 to the principle, 1/3 liquidity(cash), 1/3 to high risk, specutative investments.
    With the specutative investments I offer start up finance to "ideas" people.
    I do so for a share of the company, a seat on the board and full voting rights.
    In these cases I am putting money not so much behind the idea but the people behind it.
    Remember with the right people sand can be sold to the Arabs.
    I at these sort of investments as a calculated gamble - all due care is taken to ensure success and then I don't worry after the money has been paid and the paper work signed.
    After all, this is money I could have taken to the casino or blown buying over priced clothes and shoes, so when it comes to these sorts of investments I sleep very well at night not having to worry if they succeed or not.
     
  10. D_Bob_Crotchitch

    D_Bob_Crotchitch New Member

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    Recent studies have shown that most people in the USA are financially illiterate. It's sad. People need to teach their kids all about finances. Maybe, parents should take a course along with their kids.
     
  11. D_Ivana Dickenside

    D_Ivana Dickenside New Member

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    the only wealth creation tips i can give are to save a piggy bank! or in my case, a super sayin dragonball Z bank :smile:
     
  12. AlteredEgo

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    Has that really helped you or someone you know create wealth for themselves? Even despite the lack of interest? Is there a "part B" to that plan?

    Could you please discuss further how you find these people? This is fascinating!


    My mother didn't know anything in this area. She had no idea that she didn't know, either, or she'd have tried to find out. So, I started at zero. It was less than zero, actually. When I started, I was in debt for no real reason. At least what debt I have now serves a purpose.

    It's one thing to be ignorant, but quite another to be willfully so. I have no one to teach me, so I'll read everything I can get my hands on, and eventually I'll also attend classes and seminars.
     
  13. D_Bob_Crotchitch

    D_Bob_Crotchitch New Member

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    My parents didn't teach me much about money. I learned on my own. Not having any extra growing up made me save every penny I could get in my hot little hands. It is part of the journey of growing up. I hope the books I recommended make sense to you. They are a good place for a novice to start.
     
  14. exwhyzee

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    Real estate has never let me down, even in the current situation in the US. You have to know when property is overvalued, and when it is undervalued. Hard to beat the cash flow of an income producing property.
     
  15. lucky8

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    I've actually been studying finance and entrepreneurship for the last four years with an emphasis on investments. A couple good books I've been assigned are The Little Book that Builds Wealth by Pat Dorsey and The World is Your Oyster by Jeff Opdyke (SP?) Anything by Warren Buffett is a good read in my opinion.

    What kind of investments are you seeking? Are you thinking stocks? Business investments? Land investments? Bonds? I'm sure you already know this, but if you're investing in start-ups, you really have to make sure that the owners are really on top of their game and have a desire to grow their company into a large corporation. There are so many people out there that have no idea how to grow their business, it's scary.

    I know I'm young and my opinion probably doesn't matter much to you, but all finance majors that are focusing on stocks at my university are in charge of an $800,000 fund, and we're currently looking at KDN (Kaydon Corporation) to invest in. My advice, probably not the best but hey, you asked, is to look for things that are involved in the "going green movement" if you want to play the market. There is A LOT of money to be made there. I have read so many damn 10Ks in the last year i don't even know where to begin on which companies are a waste. 3 things there will always be a large demand for though: food, housing, and energy. Have you considered investing in international markets?

    There are so many businesses right now that are trying to go global, if you do your research and find the right one (especially manufacturing businesses, and especially steel), there's no telling how big you ROI may be. Good luck. Isn't making money with money fun?
     
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