College degree debt is the newest big debt trend that sinks people after mortgage debt, vehicle debt, & credit card debt. In the past the debt ratio to return on investment was lower then it is today. An ounce of prevention is worth a pound of cure so looking for way to prevent college debt is better than trying to pay off the debt…
Radio host Dave Ramsey has a debt elimination framework he calls Baby Steps. It seems to work well from the people I have talked to who have used it. I often think many frameworks can be improved. This is just a not so quickie article on what ways I would tweak the Baby Steps to “improve” it. (In fact it is part II because part I started to get long)
Welcome to Part II
A few articles ago I analyzed the budgets and profits of Mockbuster movies. That got me thinking about what is the profit margin for big studio blockbusters and how does overhead effect the film’s success.
Do nothing and nothing happens. Do something and something happens.
The power of action is not something that can be taken likely. Procrastination is the opposite of progress. Progress can only be made when action is taken, even if the movement is backwards you are a step closer to move forward. Sometimes a bad action is needed to get started on anything. Sometimes writing these articles I have a loss for words. The way I bust through it is to just write about anything and eventually I come up with something I like. Sometimes what I write is so-so in my eyes but, It gets me to move forward on something I really want to say.
Procrastination is Opportunity’s Assassin
~ Victor Kaim
I like to look at things through a financial perspective because it is easier for me to try and value anything. Money no matter what the currency ultimately is valued by labor. It is all relational. To make bread you have to factor the ingredients, the labor to make it, and the production tooling. The ingredients are a factor of labor by themselves as well as the manufacturing of the tooling. So all money is wealth which is a representation of labor.
In part one the example of a 14 year old who invests $5000 one time of the money earned while babysitting showed the power of compounding over a long period of time. Of course as effective as it to invest one time for a long period of time is the most effective way to make use of this is to do the same process multiple times .
Parcheesi with 72 Spaces
Previously I went over briefly the Rule of 72. After going the rule over with a few people in the last couple of weeks it seems the power of the tool is lost until it is applied in a personal finance context. The math behind the rule is simple. The number of 72 is divided by the interest rate of an investment equals the time in years the money will double.