Breaking Bad Tradition

On the road to financial freedom, we are most prone to emulating the lives and habits of those we learn from. And, more often than not, those models are our parents. Some of us had parents who exhibited awesome financial habits, and managed to learn from them. Others of us were not so fortunate, and may have developed poor financial habits and practices. But that doesn’t mean all is lost or that it’s too late to change direction. Over at the Art of Manliness, guest contributor Jeff Rose shares a couple tips that will help us to not make the same money mistakes as some of our parents. Keep in mind, that these tips are things you will have to work on with diligence; a lot of lessons we learn self consciously, and can be hard to shake. Check them out after the jump!


  • It’s all in the mindset: Thoughts such as debt being inescapable or financial hardship just being part of life are usually just poppycock. While certain hardships do come, folding to defeat or using them as an excuse for poor habits are no way to improve your condition. Maybe the reason you believe these things are because of what you have been taught as a child. But the first step to correcting this mentality is coming into a sense of self awareness. This idea of change starting with the mind is far from self evident, and by all means, you should share this with others less fortunate than you. Anyway, how do we break free from the prison of our minds; how should we frame these situations? Again, it starts with awareness. If ever you find yourself jealous of the material gains of those around you, do not automatically blame it on circumstances or the idea that they have more than you. Take a step back and look at your own financial habits. What are you doing differently? What are you not-so-great at or what could you be doing better? Consider that you don’t have all the answers, and look around you, ready to emulate better role models.
  • Mentorship: Next, you’re going to have to find a model to stick with. This may seem to be unnecessary at first, but you will soon enough realize that there are a ton of nuances to the finance game, and have questions upon questions. It would certainly help if someone could answer them! A good first step is joining a personal finance site (like this one!) that is teeming with tips for the person trying to gain control of their wealth. Rose suggests The Debt Movement and Enemy of Debt. Or, you could take the old fashioned route, and pick up a book by a reputable finance guru like David Ramsey or Napoleon Hill. Next up, you should definitely try to forge a more personal relationship. Unless you know a financial powerhouse firsthand, it can be a bit awkward to start a relationship like that. So what can you do? For starters, why not reach out to financial institutions and directly ask questions for experts in that field? Want to learn about loans? Talk to a loan officer. Interested in small business? Talk to the owner of your favorite shop!



How to Control Personal Debt

At some point in your life, you may find yourself in debt.  Whether it’s from credit cards or mortgage loans, there are always ways to improve your personal debt and get on track towards accomplishing your financial goals. To start, it’s vital to pay attention to your own spendings so you can avoid falling into financial debt.  But, if you do find yourself struggling with your finances, make sure you gain the knowledge you need in order to aid yourself to recovery.

CNN money urges you to be aware that some debt is good, as long as you can pay it back.  For instance, borrowing loans for college is a smart decision, because with the degree you earn, the higher your chances are of landing a job and having a better income.  Just always make sure you look for the best rates and be comfortable with knowing that you will have to pay back the loans – you don’t want to put them off for too long.

Many Americans are overwhelmed with credit-card debt, so make sure you aren’t using a credit card to pay for things that are rapidly consumed.  In 2012, according to, the average American household has around $15, 950 in credit-card debt.  This is the fastest way to fall into debt.  It also means that you should refrain from using your card on things like meals and vacations, especially if you don’t think you will be able to pay off your monthly bill in up to two months.  Be smart about what you’re spending your money on.  Always ask yourself if you really need it.  Of course, we all have our own splurges from time to time, just make sure they’re worth it.

money, cards, bills

There are several means by which one can control debt.

A good way to know what you’re spending each month is to write it down.  Most people spend more money than they think they do without much thought about what they’re buying.  Start knowing your expenses, because once you are aware of your spendings you will cut back on unnecessary items.  This simple task of keeping a written record of your purchases will help you save money are quickly help to reduce your debt.

Another key to reducing your financial debt is paying off your highest-rate debts first.  Many people tend to avoid taking care of these debts because they get scared by the high numbers.  In reality, paying off the balances of loans and credit cards that charge the most amount of interest will help immensely reduce your debt.  Take it one step at a time, you don’t have to pay off each of your highest-rate debts at once, but you’ll feel much better about your financial situation once you start to pay off those big debts.

Remember, knowledge is power – so know knowing how much you spend each month and what steps you need to take in order to improve your personal debt is key for financial success.

Investing in Stocks: A Brief Primer for the First Timer

Stock investment is a fundamental aspect of being involved with your personal finances.  Buying a share of stock means that you are taking a share of ownership in a company. And stocks aren’t just pieces of paper; they have a lot of value.  Before you decide to buy a stock, it is important to have knowledge on what stocks are and how you should invest them. Thanks to an article over at CNN Money, there’s no need to be intimidated when making the big jump to investing in stocks.


john j bowman jr accountant stocks

There’s no need to be afraid when getting into the stock market for the first time.

  • First, you should keep in mind the vast variety of stocks that exist.  This will guide you to dividing the stock market in an organized manner, either based on growth patterns, sectors, the content of particular stocks, or any other way that helps you arrange stocks in a systematic way.
  • It is important to remind yourself that company earnings are the primary factors of whether or not a stock’s price will go up or stagnate.  Everything else, like the market behavior, is usually based on fear, news, rumors, and spirit.  Like most things involving finance, remember that there is truth in numbers if you look at them in terms of their long-run.
  • Thirdly, you should know that stocks are extremely important for getting above the pace of inflation.  In a year, the average large stock returns near ten percent.  This is ahead of real estate, inflation, and bond returns, which results in the conclusion that stocks are the optimum way to save money for long-termed goals.
  • Learning to assess a stock’s value is another key aspect to becoming a well-learned stock investor.  Most investors compare a stock’s price to revenue, cash flow, earnings, and other substantial material.  It is also helpful to weigh a company’s expectations regarding performance to the whole of the industry.  By doing this, you can get a good sense about if a stock is over or undervalued.
  • As a last rule of thumb, investing in stocks of various industries is a smart way to enhance long-term growth.  In case a specific area of the economy experiences an economic downfall, you will not have all your stocks in that target area.  Think of it as not putting all your eggs in one basket.