Net Worth November 2015

Stairway to Heaven - Kyle Gendary

pc: kylegendary

Here is my first real net worth update. It feels a little intimidating putting this out to the world.

I’ve read many articles and stories saying that people would rather speak in front of crowds instead of talk about their finances openly. Maybe it’s because they have  little bit of shame hiding within themselves to let out the truth.

Being able to talk about my net worth with real numbers is tough. I feel that it will keep me accountable for where I am at, and where I want to go in the future.

Net Worth 113015

Total Cash and Bank Accounts (+$857.06): This consists of two life insurance polices that I use as banks. I am able to freely loan from it. Annually there is a dividend that is given, and it grows at 5%.

IRA(-$3.90): My investments didn’t do too well this month. I’ve invested 70% it into a Vanguard total stock index and 30% into a total bond index. I’m glad that I get a dividend every month from the bonds, and a quarterly dividend from the stocks.

Credit Cards(-$2,586.16): I ended up borrowing money from my life insurance policy to pay off a balance transfer a while back. The terms of the loan made it more costly than I had hoped.

Tax (-$267.37): I ended up having to pay some tax to the federal government a while ago, and I am deciding to pay myself back for that. It also goes into my emergency fund.

With my current payment plan, this debt will be paid of by February.

Car (-$233.59): I’m paying myself back with interest on this loan. I’m excited because this allows me to put it back into my cash account.

Do I see my car as an asset? Not really. It doesn’t appreciate in value over time, and I don’t plan on selling this car or trading it in for another car anytime soon.

Student Loan (-$172.20): This is by far the hardest thing for me to get rid of. It’s also going to be the last thing I’ll end up paying off. The interest rate on this isn’t too bad at 4.47%.

You may say that it’s kind of dumb to have my money in a life insurance policy vs paying off my student loan. After running numbers, I’m actually getting more money back by having the money compound in my life insurance policy. (I’ll explain this more in a later post)

Misc Loan (-$3.24): This consists of money that was used in a bad way. This actually has some debt I paid off because I tried to do a balance transfer to see if it would work in my favor. In a short answer, it caused more headaches than I would like to admit.

I also used some money in my cash account to pay for the balance transfer on my credit card. I’ll be paying myself back on this as well.

Overall, the progress is going in my favor. Slow and steady, and having a specific plan will help me pay down these debts.

Personal Finance in Paradise – Debt Elimination Series: Part 3 – 5 Step Plan of Attack toward Debt

Wailua Falls. Kaua'i

Photo by: thisworldexists

In this final step of the process. This is where you plan your month before you start it. This is like an architect who begins the process of building a house. You start with blueprints and then you begin the building process with raw materials to start the foundation. Your budget and debt snowball is the blueprint and the building of the house are the actions you take to get out of debt (budgeting).

You can do this on Microsoft excel or a notepad.

Step 1 Income: Start your month with your first paycheck and have this at the top of your sheet.

Subtract your fixed expenses first. This will let you know how much get to spend for the rest of the month. Then subtract the amount you may need for variable expenses. This will give you the remainder that you can spend on anything that may come up.

At this point, every time you make a purchase subtracted from your paycheck amount. This is going to keep a running tally of how much you can spend for the month. This will keep you from going over budget

Step 2 Fixed Expenses:  Find out what your monthly recurring expenses are.  They are typically savings, cell phone, subscriptions, donations, student loan payment, car payments, health and life insurances. It’s best to know theses expenses before you get caught in a crisis. You will probably end up having to use your credit card to pay for these expenses, and then get further into debt.

Savings is first on the list because your goal will be to live the remaining money. Trust me, you will be able to make better judgments throughout the month with the rest. You can start saving with 1% of your income. Get your feet wet, and over the months, you can increase the amount you save by 1 more percent.

My car insurance is paid every six months, so I take the total amount and divide it by six. It helps me to break down the payment into smaller manageable amounts instead of having to come up with $360 in one month.

For instance, if you have a car insurance to in January for $360 you would take $360 divided by six to get $60 dollars which would you will put away in either a savings account or leave in your checking until it becomes due in January.

Step 3 Variable Expenses: Like I said in the previous post, we are bad at estimating our true expenses. What we want to do here is get a general idea of what we may be spending in each category of non reoccurring expenses and then add 25%. It’s better to overestimate than underestimate your expenses.

These are things like groceries, gas, and other miscellaneous expenses that you may come up with over the month.

Remember for the categories, like groceries, make sure to add what you spent as an expense, and then subtract from what you had set aside for groceries for the month.

Step 4 Tracking: Take your notepad and and pen, and every time you use your debit card, credit card for use cash, will write down the expense. What you are doing is keeping a register of the expenses you have during the month.

The act of writing your expenses will keep you accountable to yourself. It also makes you think about what you’re buying. For instance, will I need this extra water bottle? Will this handbag be worth it in the future?

Step 5 Make Adjustments: If this is the first time you’re making a budget, you will make mistakes and overestimate expenses. This it took me a few months to get a handle of what I could pay for variable expenses. It’s a learning process and the more you track, the more practice will get by doing it.

Let me know your thoughts and if you have any better ideas please let me know.

See you soon

Personal Finance in Paradise – Debt Elimination Series: Part 2 – 5 Steps to get a handle on your debt

Hanauma Bay

Image by propst7pl

This is part two of the personal finance in paradise debt elimination series. The focus of today is to set a step-by-step process of getting your credit card debt down, and to be able to set up plan to follow so there is no wiggle room..

The major thing that holds people from investing and building wealth is credit card debt. If you are getting charged anywhere from 12.99% to 24.99% on credit card debt, it is going to be an uphill battle to building wealth if you’re losing money by paying interest.

This is a simple detailed plan of what to do and how to get out of debt so you can begin building wealth.

1. Find out where you are: in scientific studies, it has been found that people are really bad estimators. When it comes to managing their time or estimating the amount of debt that they owe, people tend to underestimate the amount of debt they really do have in their accounts. For instance, a person may think that they have $10,000 worth of debt, when in reality it can be anywhere between $12,000-$15,000.

There are online websites such as CreditKarma.com, credit.com, and mint.com that’s are good resources which I have used in the past. These resources can access your account information and give you an overall picture of the types of debt that you have.

CreditKarma.com and Credit.com both have access updating your FICO scores as well. These may not be completely accurate at the time, but it gives you a good idea of where you currently stand.

Think of it as your adult report card. It gives you a snapshot of how well you are doing. If you have a negative net worth you can be doing better, and if you have a positive net worth, what can you do to invest more.

2. Negotiate Interest Rates: one of the ways to pay less on your credit cards is to lower your interest rate. It’s pretty easy to do, all you need to do is call your credit card company to ask for a lower interest rate. Give them a compelling reason, like you been paying on time, you have been a longtime customer with the company, and or you have also been struggling with payments. It may not work the first time or with the first person that you speak with, continue to call and ask for manager if necessary.

I personally have called the credit card companies when I have missed the payment, and my interest rate shot up from 9.99% to 24.99%. They were very lenient and they had told me that I needed to pay on time for six months or my interest rate would shoot back up to 24.99% if I miss another payment. It’s worth a try, you may get shot down, continue until you are able to get that credit card breakdown.

3. Stop getting credit card offers: when I began college, I got stacks upon stacks of mailers from credit card companies to sign up for their cards. To prevent being enticed by the credit card companies stop the credit card offers from coming to you.

One way to stop credit card offers is to contact one of the three U.S. credit bureaus three credit bureaus, Equifax, Experian, and Transunion, and have them remove you from all pre-screened credit lists. When you contact one of the credit bureaus they must contact the other two to let them know that you do not want to receive any offers from credit card companies.

Another way of doing this is to go to optoutprescren.com and click on the bottom link that says “Click Here to Opt-in or Opt-Out”, and fill out the the form and mail it in. I sent in the information, and I do not receive any other offers.

4. Choose Your Strategy: Use the debt snowball strategy, popularized by Dave Ramsey, which lists your debts in order from smallest to largest. You start to paying off the smallest debt with all the extra money you have while paying the minimums on the rest of your debts. Once the first debt has been paid off, take the money you are putting to the smallest debt and use that money to pay down the next debt on your list. Continue doing this until you you are done paying off your debts.

5. Track Your Progress: Make sure to log your progress. It’s easier to keep going if you know how well you have been doing.  You want to be able to create good tracking habits so that you can focus on the rest of your life.

One good habit is to put reminders on your phone calendar every month to update your accounts, or piggy back a habit on something that occurs regularly.

Personally, I track my information on Quicken and I forecasts my expenses for the month on an Excel sheet. I get paid on the 15th and the last day of the month. I update my accounts and prepare for the next month on payday.

it doesn’t matter how you track, just find a system that works for you.

 

Personal Finance in Paradise – 3 Steps to Achieve Your Goals (which helped me pay off $35,000 in debt)

Stairway to Heaven  pc: @ricahyokoi

The New Year is coming around and about time when I personally start thinking about my goals for the the next year. I feel it’s always good to update yourself on how you are doing on your goals. Another good habit is to continually make new goals as you complete others that you have finished.

One of my goals is to go to the CrossFit box here in Honolulu at least 2 to 4 times a week. Sometimes I don’t go because I’m not motivated. It’s good for me, but at the same time we all go through the love-hate relationship at the gym.

My current financial goals are to payoff at least $10,000 of debt, which will also increase my net worth by $10,000.

In my studies and my own personal practice, there are practical ways to reach your goals, which are easy to do and also easy not to do. when I was able to pay off $35,000 of my debt, before I was married, I followed the following steps:

1. Define Your Goal

This is where you decide what you really want. My goal was to get rid of debt, and I had choices to make. Like I said above, my goal is to pay off $10,000 of debt. This is attainable and specific.

A good outline is using the SMART criteria for goal setting. It’s a good way for you to gather your thoughts, and to know the general idea of where you are going.

Specific – target a specific area for improvement.
Measurable – quantify or at least suggest an indicator of progress.
Assignable – specify who will do it.
Realistic – state what results can realistically be achieved, given available resources.
Time-related – specify when the result(s) can be achieved.

2. Plan what what small steps you’re going to take

Define the most important tasks that you can make so that you can get to your goal.

Be specific  with what actions you are going to take. Some people call this having a black-and-white goals, meaning that there will not be any gray area of what you can and cannot do.

For instance if you’re going to pay off a specific amount say $650 a month to your credit card bills. there is no gray area, it is a specific number and you know what you’re going to have to do.

3. Define your “Why”

Getting to your goal is easier when you know what you’re trying to achieve and why it is good for you. My why was getting to travel to Taiwan, and be able to fly around the country with friends.

This is the motivator for you and only you. There will be trials that you will go through reaching toward your goal. Getting on to the road of wealth creation is a marathon. Sometimes you just want to quit.

4. Take Action and Celebrate the Small Wins.

People find it more motivating to be partly finished with a longer journey than to be at the gate of a shorter one.

Once you start, you’re already that much closer to the finish line than you might have thought.

For your money this is where you track your expenses when you make them, and to enter it into a program like Quicken where you can see what you have done with your money. This allows you to have a history of what you’ve done, and it lets you know where you have spent your time.

It’s also writing down your expenses at the end of the day. It’s a transitional habit because you become more aware of what you are spending your money on, and you know you have to be accountable for tracking where every cent and dolalr goes.

While I’m Crossfit, and I’m looking at the countdown timer to see how much longer I have until the clock with hit 00:00 or counting the reps until I’m done with the workout, I celebrate the time passing by  doing another rep or seeing the clock tick away. I know that I’m almost done with the workout no matter how grueling it can be.

The steps are easy to do and also easy not to do. at least, for me, it gives you a framework of setting goals and achieving success.

Personal Finance in Paradise – Let Me Introduce Myself

Akaka Fallsjpg

My name is Mike

I’m the creator of Personal Finance in Paradise. The reason behind why I started this blog is because I hate debt.

Prior to getting into debt i had quite a bit of savings, and I used it all on trips and training in other parts of the country.

I’ve been in debt as far as $66,500 and having not much to show for it, and I felt that I needed to do something different with my life.

I looked and searched for all of the ways possible to get out of debt. I read online for specific tips and tricks, even paid for a program that said it would pay off $25,000 in debt be 24 months with an annual net income of $40,000. (Come to find out that program lied, and I believed the impossible). I continue to read both secular and non-secular ways of how people do with money.

I’ve been around the block. Making bad mistakes along the way, and trying to find out the best way possible to get out of debt.

A Few Examples of Bad Decisions

I cosigned two loans that the original payers defaulted on, and creditors came after me for that as well. I was able to fend off those creditors and point them into the right direction.

Creditors called me, and I was able to fend them off. They tried to subpoena me, and force me to tell them that I owed a debt that I didn’t own personally.

I’ve had an “a wide” set of experiences in my life. At the top that all off I do live in Hawaii. That’s one of the most expensive places in the world to live.

Sometimes you you may have seen that you get a two bedroom home here in Hawaii for the price that you would get a mansion out in Texas. The goal of this site is to keep not only myself accountable, but to also teach my experiences to help you get out of debt as well. My goal is to reach out to you who have been in my situation.

Some of this may sound not so “grammatically correct”, because I’m not a grammarian nor am I a grammar Nazi. I’m using a program called “Dragon Dictate” to record my voice  and put it down here on the website. So going to apologize ahead of time that this may not be completely grammatically correct.

I’ve heard it said that “smart people learn from their own experiences, and wise people learn from the experiences of others.” My goal is to help you to be wise.

I’m excited to hear from you, and I’m glad that were going on this journey together.

Personal Finance in Paradise – My Story

Aloha

pc ig: cq__

I thought about chronicling my debt story into a book, and thought the background of how I got into debt would be interesting.

I found myself being college student who seemed to go back and forth between wanting to stay in school and feeling that it wasn’t the right place for me. Hearing all of the stories of Bill Gates and Bill Wozniak fascinated me about what they were able to do in business and in life. Hearing the stories built a strong desire in me to find something to invest in. I didn’t know what I wanted to do so I began searching. I started to read self development books, and how some of the writers were able to pull them out of poverty and build great wealth. I continued to read business books and came up to the subject of real estate investing, becoming a stock market millionaire, and building businesses from nothing into multi-million dollar corporations.

A friend invited me to a weekend seminar in the summer of 2005 where you would get a feel for real estate investing, find out if investing in real estate was the right choice for you, and if it was even plausible to make money in it. It was my first time going to one of these events and all you could see were rows and rows of chairs. At the front of the room we heard the music pumping as the eight hour day began. A short blond woman with glasses walked up to the front and introduced herself. She began talking about how she had used other people’s resources get into her first real estate deal. I was mesmerized because she said that you didn’t need to have much to start your real estate empire. You just needed to make the right contacts, buy some houses, and resell them to investors.

It was the height of the real estate boom. She asked to the crowd “does anyone know what hard money is?“ I thought I had answer, so with great and utmost confidence, I threw my right hand into the air and stood up. One of the volunteers quickly grabbed a mic, and began rushing toward me. When he got there, I took it, and in front of 500 people I said with my with the greatest bravado and confidence I said “hard money is money that you need to work hard for.” The crowd laughed so hard that it reminded me of the stories of Santa Claus’ belly shaking. I was thinking in my head “that probably wasn’t the right answer, but at least the crowd was happy.” I was embarrassed, and I sheepishly gave the mic back to the volunteer and sat down. The speaker looked at me a little awkward at first, and she smiled. She said hard money is hard to work for but in this case that’s not what I meant. Hard money is really the money that you borrow from a hard money lender. A hard money lender is someone who lends their money for short period of time with a high interest rate to investors in real estate. The speaker’s voice started to fade out and at that point in time something in my mind clicked, I wanted to know more, and I thought I could build an empire.

Later that weekend I picked up a book and I found myself gorging on a book about real estate. I found myself being sucked in, and the information felt so fascinating that I just wanted to finish the book as soon as I could. I felt as if this was the right path for me. Greed had gotten to me. At another meeting that weekend they revealed the the tuition which was $30,000. I thought if I can buy and turn around I real estate property for thirty thousand dollars I would make up the cost of my tuition. All I could think about was building an empire.

Two months later, I found myself traveling to Arizona and learning about real estate acquisitions, business theory, and trying to get deals done. Then I found myself in a room, a conference room filled with hundreds of people trying to do the same thing. Little did I know that all of these people were broke, and there were not very many success stories from this pool of people. All I wanted to do was become wealthy by any means and have fun while doing it. I was beginning my life as a wannabe entrepreneur that chose not to go to college.

It took a while for the blinders to come off, but they finally did. January 2010 I found myself with $66,504.69 of debt. A bulk of this debt was a student loan $29,242.86 and the rest piled into three credit cards amounting $37,261.83 in three credit cards. I didn’t realize what I had done to get in so much debt.

I could have done a lot of things like complain about my situation. I realized that I created my own reality. I violated all of my values of being prosperous, saving money, and paying for things when I only had the money. I chose not to complain about the situation. I chose to buckle down and get to work. Many people put stock into worrying of what cannot be done. If you choose to focus on the actions that you can control you will be better off.

Personal Finance in Paradise – Veteran’s Day – How You Handle Your Money: Mindset

How mental accounting affects your spending

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It’s Veteran’s day!

I want to thank all the veterans who have served our country. Thank you for being able to protect the freedom we take for granted and are able to take part of today.

Let’s talk about how we label money affects our buying decisions as some of us shop online and at the stores.

The Scenario

Let’s say this morning you wake up and start the day off great with a good breakfast, and you even got to sleep in. Then you go online and start shopping at your favorite clothing store site. You see a great looking shirt that you think you would look great in, and you buy the shirt on credit. For the moment, it makes you happy, and you don’t give it a second thought because you can just pay it off later.

Later in the day, you go on a hike with a few friends and you have a blast being in the sun. On the way home, you see your favorite coffee shop, and you haven’t had anything to eat since breakfast. You remember that they the best coffee cake. You and your friends decide to go take a peak. Once inside, you find that your favorite barista is working. You ask him to make a large iced caramel macchiato. You have a few laughs with the barista, and he gets your name wrong again on your cup. You pull out your credit card again, and you notice you have a dollar and some change in your wallet. Feeling generous, you place the money in the tip container as you leave.

Then in the evening, you take it easy and you go to a movie with your friends. You have a great day celebrating veterans, sharing some laughs, and enjoying life. Then later in the month you get your credit card statement, and you are confused on why you spent so much. What happened?

Mental Accounting

Why did we decide to go out and spend more money than we wanted? We’ve fallen victim to mental accounting. It is a concept where we treat dollars differently depending on where it comes from and how we have labeled the use of that money. The difference is that when we pay for merchandise with cash or with checks we see immediate consequences. The obvious answer is that that we have less money to spend.

We place less value on money we put on credit cards because we do not see the immediate consequences. At the same time, we don’t see that buying merchandise on credit is more expensive because of the interest that gets charged when we use the card.

Small Amounts of Money

People who have harder time holding onto small amounts of money, like putting small amounts into tip jars, have a harder time saving money. It’s because that the money we have wasn’t labeled for anything important. I”m not saying that you shouldn’t be grateful and tip your barista, it’s that if money isn’t labeled for a specific use, we will find a way to spend it.

Takeaway

To get around mental accounting, place money in accounts that are labeled for a specific purpose. For instance, a savings account, which was marked for the down payment of a house. We would be placing a higher value on the account because it limits what we are willing to do with the money.

Pre-spend money before you have the chance to spend it yourself. Let me say it this way, have your money sent over to a savings account, or investment account before you have a chance to see it in your account. Psychologically it’s much easier to set your money aside this way than by writing a check to your savings or investment account.

Track your spending at the end of the day, and keep a list of your expenses.

Have a great veteran’s day. Please feel free to comment, and let me know if there’s anything you want me to talk about.

Personal Finance in Paradise – How to develop a Financial Plan

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“If you were to show me your current financial plan, would I get so excited by it that I would go across the country and lecture on it? If the answer is no, then here’s my question: ‘Why not?’ Why wouldn’t you have a superior financial plan that is taking you to the places you want to go?” — Jim Rohn

Many of us have never been taught how to develop a financial plan, and we walk through life guessing what is the next financial move that we should make. It’s possibly the main reason why people are live paycheck to paycheck.

It took me a year or two of research and testing to figure out what I wanted in my life. One thing I recommend is the worksheet from Missouri State University which is provided in the link. The worksheet is a good start point.

The process

1. Determine your current financial situation

One of my mentors told me that your net worth is your adult report card. We lose sight of how we are doing financially, and one way is to measure how we are doing is by looking at your net worth. My financial plan started out with me being $66,500 in debt in 2007 and no savings. I started to track every purchase, and it helped me to clarify where I wanted to go in the future.

Begin with how much you have saved up (in savings accounts, Roth IRAs, and other investments), and then subtract your liabilities (all of your debt from credit cards and loans). Begin tracking your expenses and organize your financial records.

2. Develop your financial goals

I wanted to get out of it the fastest way possible and not lose any of the activities that made me happy. I asked the following questions. It helped me find out where I wanted to be in the future.

  • What do you want for the future?
  • What do you want to achieve?
  • Do you want to save a certain amount of money a month?
  • Where do you want to travel?
  • What are your financial values?

3. Identify alternative courses of action

Seeing that my purchasing behavior and spending got me into trouble, I knew that the behavior was the first thing to change. I thought to myself “there’s nothing wrong with making mistakes with money. Learn from the experience and move forward.”

Remind yourself that there is no reason to beat yourself up over the situation that you’re currently in. Your circumstances can change. It’s a learning process and it’s alright if you don’t know everything now.

4. Evaluate alternatives

Because the $66,500 price tag was looming over my head, there needed to be a major decision to be made. How much could I put toward paying down the debt. After running numbers in my budget, I decided to put $1,250 a month to the debt and that was the first thing to come out.

Of course I had to give up a few luxuries like being able to eat out often. As I learned and searched for alternatives, I gained respect for money, and relearning delayed gratification. The choices you make now get will get you closer to your goals in the future.

Weigh the costs of the choices that you make. For instance, Can I make steady payments of $650 to my debt per month? What better choices can I make with my money so I can get to the $650 goal

5. Create and implement your financial action plan

After I decided to take action, all the stress and emotion was taken out of the decision making process. It ended up becoming a game of how could I make better decisions to pay the debt down faster.

Once you have made a few decisions on what you want, and the direction you want to go, it’s time to make that plan work. This is the testing phase to see if you are able to work with your plan, and if it will work for you. The hardest part of gathering all the information and planning is complete.It will be hard at first, and the process will be worth it because you are beginning to change habits that you didn’t know you had before. You are on the road to becoming better with money.

6. Review and revise the financial plan

Your first plan isn’t going to be your last. As you move along in life, your financial situation is going to change. My financial situation changed many times over the years. Yours will too. Trust in the process, adjust when you have to, and restart from the beginning when you have to.

For more detail go to wikiHow to get deeper into the planning. Let me know if this helped you, or if you have any suggestions please let me know. See you again soon.

If you go to work on your goals, your goals will go to work on you. If you go to work on your plan, your plan will go to work on you. Whatever good things we build end up building us. – Jim Rohn

Money Moves October 2015

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Welcome to Money Moves for October. This is the section for review and to reflect on the things I have done and what could have been done better for the month. I hope you find it interesting. Hopefully it will help you make better decisions for yourself.

Let’s begin with what the end of the month with my my financial report card. It looks something like this:

Net Income from Work  $2652.99
Expenses $2652.99

Reoccurring Monthly Expenses:
Rent: $1045 1 bedroom 1 bath. It’s Hawaii, rent is expensive
Car Payment: $316.97
Student Loan $202.05
Life Insurance $187.51
Extra to debt 130.98

Assets:

Cash value in 2 life insurance policies $16,276.48
SEP IRA $11,630.85
Total: $27,907.33

Liabilities

student loan $20,023.06
Car loan $10,015.61
Chase credit card $3448.54
miscellaneous loan $6312.88
Total: ($39,800.09)

Current Net Worth: (11,892.76)

A few things to note, I had my credit card paid off, but  I had an idea a few months ago that  I could do a balance transfer and continue to use my credit card without paying interest due to the CARD Act. I wanted to continue using my credit card to take advantage of the 1% cash back, and it would benefit me as long as I continued to pay my balance off in full. I confirmed it with a representative, and he confirmed that I could use my credit card and not be charged interest.

When I got the statement the next month, I found saw that I was charged interest. I had to talk to two different managers to find out that the initial guy was wrong. I have nothing against with balance transfers, if you have a plan to pay it off and get the right information. To say the least, the idea bombed, and I get to have a nice conversation with my credit card company to reverse the interest charge.

 Another thing you might notice is that my expenses are exactly what I make in a month. I pay for all of my purchases in the same month that I charge them, and I am paying more toward the principal balance of the loan. Essentially, I am using the debt snowball method of paying down my debts.

My checking account is attached to a personal loan account where an overdraft amount is taken out to cover any charges that I make beyond what is in the account. There is no fee charged if I use the overdraft amount, which is really nice, and I am able to pay down my balances on my debts a little bit faster.

Using the debt snowball method and using all of the money in my checking account; I save a little bit on interest charged daily.

I have cash value in my whole life insurance policy (actually it’s 2 policies) that I use as a bank. Cash value life insurance has many living benefits, and being able to use the money in your policy as a “banking system” gives a person a lot of flexibility when purchasing something and being able to grow and get dividends on the amount in the policy as well.

The last thing to note is that I received income from my employelr in a retirement fund. As you can see above income, from the SEP IRA, has been into the 70% stocks and 30% into bonds. Using Fidelity as the brokerage firm, the money is invested into a few stocks of Netflix, a total stock index fund from Vanguard, and a total bond index from Vanguard. I did that so that I would have the ability to have growth in the stock market and pay the least amount of fees possible. I’ll talk about fees and how it hurts the growth of your investment in the future.

Plans for the Next Month

I’ve finalized how I am going to pay off the debt in the most efficient way. I’m going to pay off the remainder of my credit card balance with cash that is in my whole life policy. That way I won’t have to pay any interest on my credit card, and I no longer have to call my credit card company to reverse the interest charges.

Paying myself back for the loan balance I have taken out at my insurance company. The policies do not accrue interest on a daily rate like credit cards, and interest is only charged to me when my premium is due. That means that I pay my premiums in in July and October, and if there is an outstanding balance, I pay interest then. Also, I’ve got it set up where I don’t have to pay interest at all on the loan by filling up my policies before the billing statements come out.

Setting up this website and making it look presentable. I’m doing my best at getting this website started with a little mishap of setting up the domain and host of the site. As this site begins to grow, I hope that I can add more to it in the future.

Welcome to Personal Finance in Paradise – What This Site is About

Welcome to part two of my financial adventure. I’ve been wanting to heart a blog and put my thoughts out into the world so that people can learn from what I have been learning. I feel that people can learn from my mistakes and also from my victories along the journey.

I hope you get to share some thoughts with me along the way, and that we are able to learn from each other.

I’m excited to be able to go on this journey with you, and that we are able to be driven to grow your net worth, destroyed debt, be able to construct good habits around money, and change your mindset along the way to become prosperous during the journey.

I look forward to hearing from you. Thanks for joining me