Money and how it works

Alright, so i was about to post this on facebook, just to get peoples minds going, but it was way to long. so now im going to post it here. Lets discuss on the subject, and expand on the matter

Has anybody ever thought that, going to school and getting a good education may not be the best way to make money? Sure you have a good job, but, you have to depend on somebody to pay your salary. somebody that is more concerned with their own salary, and is always looking to pay you less so they have more money in their pockets. All while the value of the dollar is going down and the cost of living is always on the incline.

Nice! you make a lot money working for a corporation! unfortunately for you, your also in a higher tax bracket. so for putting in twice as much work, you now work to pay the government twice as much money. Infact, taxes are a persons biggest expense! Not to mention, the down sizing of a company could end your life the way you know it. And when a company down sizes their stocks rise, they are paying less people to do enough work that their profits still turn. Which means, companies will always be looking to cut back on workers, right? of course! its more profitable, you would do the same thing right?

The truth is, everybody is out to fuck you for there own greed. but can you really blame them? Money might not directly correlate to happiness. but in this world we live in, your only as important as the dollar sign that backs your name.

I suppose there are two ways you can look at things, "The love of money is the root of all evil." The other, "The lack of money is the root of all evil"

With that said, Respect and loyalty over money

 

but honestly, it may be a perfect system. every thing is designed so perfectly to fuck you. and unless your smart enough, your going to keep getting fucked, and there is no way out of it.

the more money you make, the more debt you place yourself in.

maybe its true that only the strong survive. the strong are the entrepreneurs that are fucking everybody, while the weak are forever in debt, getting raped by uncle sam, and all of these companies that dictate how much money you owe them.

 

dont get me wrong, you still need to be an educated person. there is no way to beat the system. you have to work your ass off.

but going to school, getting a good secure job i believe may not be the best way to become a millionaire. you need to be educated financially, and buy assest, while having the least amount of liabilities as possible.

your house, is NOT an asset. it has a mortgage, electric bills water bills maintenance fees. and the more expensive your house is, the more of a liability it becomes. and if your house is your biggest investment, your pretty much fucked.

let me type a page from the book "rich dad poor dad" explaining "The Rat Race."

everybody i know is caught up in the rat race. and thats probably true for you too. the only way to become successful financially is to avoid it AT ALL COSTS!

"The moving-picture show of hard-working people has a set pattern. recently married, the happy, highly educated young couple move in together, in one of their cramped rented apartments. immediately, they realize that they are saving money because two can live as cheaply as one.

the problem is, the apartment is cramped. they decide to save money to buy their dream home so they can have kids. they now have two incomes, and they begin to focus on their careers. their incomes begin to increase. as their incomes go up... their expenses go up as well.
****

This is best demonstrated by going back to the young couple. as a result of their incomes going up, they decide to go out and buy the house of their dreams. once in their house, they have a new tax, called property tax. then, they buy a new car, new furniture and new appliances to match their new house. all of a sudden, they wake up and LIABILITIES column is full of mortgage debt and credit-card debt.

They're now trapped in the rat race. a child comes along. they work harder. the process repeats itselt. more money and higher taxes, also called bracket creep. a credit card comes in the mail. they use it. it maxes out. a loan company calls an says their greatest "asset," their home, has appreciated in value. the company offers a "bill consolidation" loan, because their credit is so good, and tells them the intelligent thing to do is clear off the high-interest consumer debt by paying off their credit card. and besides, interest on their home is a tax deduction. they go for it, and pay off those high interest credit cards. they breathe a sigh of relief. their credit cards are paid off. they've now folded their consumer debt into their home mortgage. their payments go down because they extend their debt over 30 years. it is the smart thing to do.

Their neighbor calls to invite them to go shopping-- the memorial day sale is on. a chance to save some money. they say to themselves, "i wont buy anything. i'll just go look." but just in case they find something, they tuck that clean credit card inside their wallet.

their spending habbits have caused them to seek more income. they don't even know that the trouble is really how they choose to spend the money they do have, and that is the real cause of their financial struggle. it is caused by financial illiteracy and not understanding the difference between an asset and a liability.

more money seldom solves someones money problems. intelligence solves problems."

my parents are stuck in the rat race. so are most people i know to be honest with you.

high emotions tend to lower financial intelligence.

look at this.

"1. when it comes to houses, i point out that most people work all their lives paying for a home they never own. in other words, most people buy a new house every so many years, each time incurring a new 30 year loan to pay off the previous one.

2. Even though people receive a tax deduction for interest on mortgage payments, they pay for all their other expenses with after-tax dollars. even after they pay off their mortgage.

3. property taxes. my wife's parents were shocked when the property taxes on their home went to 1000 a month. this was after they had retired, so the increase put a strain on their retirement budget, and they felt forced to move.

4. houses do not always go up in value. in 1997, i still have friends who owe a million dollars for a home that will today sell for only 700k

5. the greatest losses of all are those from missed opportunities. if all your money is tied up in your house, you may be forced to work harder because your money continues blowing out of the expense column, instead of adding to the asset column, the classic middle class cash flow pattern. if a young couple would put more money into their asset column early on, their later years would get easier, especially as they prepared to send their children to college. their assets would have grown and would be available to help cover expenses. all to often, a house only serves as a vehicle for incurring a home-equity loan to pay for mounting expenses."


that might not answer anybodies questions, but it is a nice little piece of information.

my philosophy is to develop assets at an early age, when most people develop liability's. a new car, a new whatever. something that makes you lose money. the more assests you develop the more positive cash flow you have and vice versa. develop enough assest and your assest are making your money for you.

 

and the number 1 expense for most people is taxes. you spend roughly from january to april every year paying off your taxes.

 

you cant be succesfull any other way imo. you can bust your ass and hope for a raise, or you can be the guy that gets his balls licked from his employees for a 25 cent raise