Success Warrior: Alan B. Rowley II - Beachbody.com, P90X, Voluntaryism, Voluntarism

My point and I do have one

I never read the book by Ellen Degeneres but I have always remembered the title because I tend to take the scenic tour to points that I want to make.  So, here we are coming back around on emergency funds, why I build mine up slowly, don't worry about the 3 to 6 month advice, and probably won't touch mine.

Let's say for example that you've been working this plan for a year and all of the sudden, out of the blue, how shocking is this, you need four new tires for your car.  How will you deal with this "surprise" expenditure?  Credit card?  Hell no!  Dip into the emergency funds that you've been building up?  You could but why not just pay cash? 

Cash?

Pay cash?

You can do that in 2007?  There are people out there that accept cash?

As a matter of fact, there are. 

You'll be encouraged to charge of course.  "Do you have one of our Nifty New Tire credit cards?  You'll be saving 10% on today's purchase."  You'll have to pay 22% interest over 3 years for that 10% "savings" but what a deal, eh?

You will be surprised at the amount of cash that you free up as you pay off debts.  On this plan, you take all that money and put it toward another debt.  If you follow this plan, you'll be out of debt in about 5 years.  I mean, completely out of debt including having a house paid off.

The fewer debts that you have, the easier it is to deal with the "surprise" expenses with cash.  When you haven't promised your money away, you can use it where you want or where you need.

I'm not saying that it's super easy.  The financial system that we have is a trap built by banks and once you're in the trap, it can be hard to get out.  I *am* saying that it's worth it.  You'll have more money and so much less stress.  Too great things in your favor when hit by an "unexpected" expense.

The Beauty of Money

My wife and I talk about this often because of the path that we are on.  Once we have money working for us exclusively, once we have stepped across that line, we are going to help those around us.  We have family and friends that could use help or just our thanks.  There are charities that we would like to help. 

Right now, we are working on our situation.  We need to be in a position of financial strength so that we can help others to the best of our ability. 

A lot of people probably think of money in a negative way because there never seems to be enough.  Money equals stress.  Really, it's debt that equals stress but people transfer the feeling to the money. 

This plan could be called the Success Warrior Stress Reduction Plan.  =)

Think about what it would be like to not have any bills and to be able to give money to people around you that could use a little extra help.  That would be the opposite of stress.  It would be a joy.  Money would equal the warm feeling of generosity instead of stress.

Getting trapped in the addiction

My wife and I have been doing this plan for 7 months now.  Apparently that is long enough to change how we think.  That is probably the biggest aspect of this plan is that it changes how you think about money.  When you start looking at money, really examining it, and do this plan which is going to put money into your pocket instead of the banks, you will never think about money in the same way ever again.  That's a good thing.  It's worth thinking about.

In fact, 7 months has been long enough to get addicted to the plan. 

We've been discussing the purchase of a new TV over the last few days.  After 7 months, my wife and I are at a point where we could purchase a new TV with cash.  You can substitute any purchase in for the TV that you would like.  People that know me know that TV is a poor example anyway since I don't watch it.  The bottom line is that we can purchase most everything that we go, "Oh, that would be nice to have," but we don't. 

We see how much our debt is being reduced with each payment.  It has been our own source of instant gratification.  The debt we are paying off right now shows how much interest we pay each day.  What a great motivator!  We watch our debt go down with each payment and we see the amount of daily interest go down as well.  I'll have to ask my wife how much it has changed in 7 months.  I'm sure the number will be amazing and I'll let you know.

Instant gratification is great and I won't talk bad about it but our snowball is rolling and with each payment toward a debt, we build more momentum and get that much closer to freedom.

Tomorrow: financial slavery

P.S. Feel free to ask questions or request a topic.  If I don't know the answer, I'll try to find it.

What's the price of stress?

Medical and marital problems are probably somewhere near the top of the list.  Some doctors are saying that stress causes diseases and others are saying that stress lowers the immune system so that people are more susceptible to disease. 

Remember we are talking about the stress that comes from a lack of control.  Stress that we accept as a price to achieve our goals has been labeled eustress.  Some people are calling the bad stress, distress.  When you say stress, people generally think of the bad kind and that's the label I'll be using.  Stress.

My wife got an offer yesterday in the mail that would solve our financial problems.  A bank sent her an ad that said, "Use our money to pay your bills."  Isn't that nice?  We can use the banks money to pay our bills.  Don't they make it sound like that's the end?  In fact, we could HAVE as much as $150,000.  Such generosity, how do they stay in business?

That part is found on the back of the ad.  You have to repay them at somewhere between 8% and 12% interest.  What?  You have to repay them?  What happened to using their money to pay off my bills? 

And how much do you repay them?  It seems that people in general are having credit problems but we'll go with the middle ground of their offer and say that you get an interest rate of 10%.  Remember, it's only 10% if you pay it off in one year.  For a loan of $150,000, we're probably talking about a refi so we're looking at a 30 year loan.  When you make that last payment in 360 months, you will have paid the bank $473,089.60.  Who's the generous one?  Them for loaning you you 150k or you for giving it back and adding 320k on top. 

Ahh, that's how they stay in business.

Tomorrow: Why they make the offer.

Stress

There is no such thing as stress free.  At least not in a the real sense.  I suppose it is possible to use drugs and alcohol to achieve a short-lived sense of being stress free.  Sobriety brings back the reality of the situation and in many cases, more stress.

Life is stressful.  Life is supposed to be stressful.  We need to accept that.  Stress is a catalyst for growth and improvement.  If there was no stress in this life, we would all still be living in a cave eating barbequed mammoth.  The lack of language wouldn't be much of a problem because we wouldn't have much to talk about.

Everything that you undertake in this life is going to come with stress.  If you are starting an exercise program, it will be stressful.  It will be stressful mentally because you are trying to make a change for the better.  Additionally, exercise itself is stress placed on the body so that it can adapt to the stress and improve.  If you are going to work this financial plan, it's going to be stressful.  Stress brings improvement and instead of being seen as bad, it should be seen as good.  Improvement and growth are good.  In order to improve, you have to deal with stress to become stronger.

What people commonly refer to as stress in our world is actually a lack of control.  It's still stress and it can still bring growth but many people look for the short fix and as such, the stress quickly returns. 

Being in debt is stressful.  The more debt, the more stressful.  This stress is a call to arms.  It's a signal that you need to grow and improve.  It's a message sent to you that you need to change something.  The alarm is going off.

Are you going to wake up or hit the snooze button?

Tomorrow: more on stress