Debt Free?

I was reading a book recently that said, “Debt free? Are you kidding me? Have you seen our national deficit?” That woke me up a little bit. Being debt free is a concept few people around the world understand. When you take into account national debts even fewer understand that being out of debt personally doesn’t mean you aren’t in debt publicly as an individual. Just look at our national debt clock.


In conjunction with debt free shenanigans, Robert Kiyosaki, Rich Dad Poor Dad best selling author, said being debt free, i.e. go to school, get a degree, work hard at a job, save your money, live conservatively, is boring, dream crushing, and wrong. Instead people should focus on how they can make their dreams come true. Again this touches on the Why and not the how, but if people could figure out Why they should have investments, in all their forms, that generate passive income for them and then they wouldn’t need to live within their means.

That brings me to good debt and bad debt.

What is bad debt? Bad debt is a liability. What is a liability? It is something that adds to your expenses and takes money out of your pocket. It can range from a car, which is also a depreciating ‘asset’, or the more common credit card. Credit cards are especially bad due to their rising and adjustable interest rates, which are already impossibly high.

What is good debt? It is an asset. What is an asset? It is something that adds to your income and adds money to your pocket each month. It can range from dividend paying stocks and bonds to rental properties to businesses that pay you in the form of dividends. Robert Kiyosaki and his wife are independently wealthy. They’ve got over, no joke, 3,000 rental units. Yet they do not know their net worth. Why not? Who cares is why. They are tens of millions of dollars in debt…good debt. Their debt services its own payments AND generates positive monthly cash flow and so who cares what the total net worth is for that couple or any couple for that matter. Answer: nobody should care.

Hopefully people wake up and realize good and bad debt when they see it and take advantage of the good and shun the bad when they can.

Italy is...screwed?

By Liam Halligan, Economic Agenda


7:40PM BST 29 Oct 2011

“…The Italian government on Friday paid 6.06pc for 10-year money, up from just 5.86pc a month ago and a euro-era high. Such borrowing costs are disastrous, given that Rome must roll-over €300bn of its €1,900bn debt in 2012 alone. A default by Italy, the eurozone's third-biggest economy, and the eighth-largest on earth, would make Lehman look like a picnic…”

"What are your plans to be rich one day?"

     Sometimes I ask people, “What are your plans for being rich one day?” Mostly it is out of curiosity, but also to see if there is anything I can glean from them. Surprisingly most say, as two of my coworkers this last week said, that they’re never going to be rich or don’t want to be. I am always baffled by this and will continue to be. Who wouldn’t want to be rich?! Now there are different reasons for all of us for why we’d want to be rich and some are good and some are bad. Certainly being rich for the wrong reasons is bad, but being rich or having goals to be rich isn’t evil.


     Who wouldn’t you want to be well off in order to spend more time with their spouse, kids, family, hobbies, or even work? If you were well off wouldn’t you like to go and do what you REALLY wanted to in life?  What is that even?  I'm sure most people haven't even thought about that since they don't have time to or don't want to.  They wouldn't want to since once they did they'd then learn how much they hated their current situation AND they'd be too afraid to do something about it.

      I’ve been studying and reading a lot of books over the last several months on the economy and finance in general. I’ve found that there are very definitive ways to profit in the coming economic collapse (this is what my studying and reading has discovered) and these ways aren’t get rich schemes or hard for the average person to understand. I’m interested in them as my end goal is to be the kind of spouse/father that I want to be or know I can be, but can’t truly accomplish them to the level I have in mind by NOT being wealthy like I am right now.

     Part of the reason I’m doing this blog is to get rich. Not to sell anything, but to get my thoughts in order and have them critiqued so that I can improvise my ‘moves’.  It is to learn and grow.  I am a fan of the book and thinking in Rich Dad Poor Dad.  Financial education creates an Unfair Advantage for the rich.  I think this unfair advantage is what the OWS people should learn about.  I've got a blog post to come on OWS later.  I also want to give back to the global community what I feel I’ve been blessed to stumble upon and understand. I truly believe that the more you give, the more you get. Some call that Karma.


Try it out for yourself. Ask someone what they’re going to do to get rich one day and see how you feel and see what you think afterwards.