In late 2007 I heard the "R" word was coming. This brought back memories of the recession that occured in 2002-2003. At that time, I was moderately in debt and my income was dwindling. I had been an avid listener to the Dave Ramsey radio show, but not fully on board with his advice.
Luckily, at that time, my house was up for sale while I was having a smaller house built. My house sold quickly and I was able to live a few months with my brother while our house was being built. We used our equity to payoff all our debts. Fortunately, my business had picked up by the time we moved into our house.
So, this time I took the "R" seriously. I had not yet built an emergency fund and I had about 3k left to pay on my truck. I immediately dropped my golf membership, dropped my cable, made an tight budget for necessities and began to work as much as possible. Within 8 months, we were able to payoff the truck and build an emergency fund of 5 months basic expenses.
Every since that time, we have invested 18%(mostly in Roths useable for additional emergency funds) of our income and established an additional 400 per month in an car fund(which could be used as additional emergency funds). We carry no debt but our mortgage. It is important to know that my family is an average income family. You do not have to make a lot of money to become debtfree and build wealth.
With that said, it seems to be common place for many americans to live in debt from payday to payday. Many will not or do not know how to change this behavoir. Many will stumble over the status quo or keep up with the Jone's mentality. As Dave Ramsey has said many times, personal finance is 80% behavoir and 20% head knowledge, all you need is a basic understanding of money and a lot of will to change.
But, here is the good news, once you commit to changing your financial health you will not suffer as you think. When you see progress you will transform away from an addictive consumption lifestyle. Once you get ahead of your finances you gain an sense of impowerment that will have you look at your life and freedom from an more independent point of view. Like me, you will begin to see the way government handles your money as an abomination.
Don't make the mistake in thinking that becoming an saver and living an debtfree lifestyle means living without. Not only will you gain financial peace, you will get more for your money while building wealth. Instead of you paying interest, you will start to reap the reward of earning compound interest.
Lastly, our country is headed towards financial storms. Many will be disapointed with the social programs in place. Social Security is not secure, I strongly urge you to prepare for yourself and not rely on these programs. I personally, would be saving less if I believed that SS would be there, but I have not faith in our government to become fiscally sound. Please, do not leave yourself vunerable, find the independent american pride within you to do what you must do.
Freedom
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Monday, May 31, 2010
Sunday, May 30, 2010
What is Freedom?
Freedom has many levels. Total freedom would be chaos, meaning there are no laws and governments. Every individual would walk this earth reaping or taking from others what he wants and needs. Obviously, this would not be good for mankind.
So we humans move to some level of cooperation with one another to get our wants and needs with some form of agreement of security. This can be from a few people(band, gang, tribe etc.) to an country of billions establishing some form of restrictions upon ourselves for the greater good of the society. This manifests itself in laws, rules etc.
But, where is the fine line between a social collectivism and an individual collectivism? What are the differences? We all know that in either collective, there will be a level of responsibility by every member to protect the rights and provide common services(geared to the masses, not the individual) to each individual. This occurs when establishing national defense, police and fire protection, courts for justice, infrastructure for waste management etc.
In an social collective there are different levels. You can have a certain level of responsibility to the others, for example:
You can have a government that collects a certain amount of ones income to be redistributed to another individual, or you can have that government take all of ones income and redistribute it evenly to the whole.
But, what is an individual collective look like? In a truly individual collective, each member would be required to provide his fair share of the costs of the collective needs no matter his income. This is not realistic so that society is likely to have those earning more pay more of the cost for common services.
Defining the line between an social collective and an individual collective is important. But, we need to explore first what the difference is between an social mentality is and an individual mentality.
A social mentality will have some level of shared societal responsibility for individual wants and needs. These wants and needs are defined as: Food, clothing and shelter for basic needs to healthcare, cars, expensive houses, fine dining, electronics etc. for wants. One of the problems that occur in a society is when it crosses into providing individual needs and deciding what exactly those needs are, and what are really indiviual rights as humans?
Defining a right is different between a social collective and an individual collective. Our basic rights are life, liberty and property. To an individual, life means my right to exist at my own provision of that life. To the collective, life means the right to life at the expense of the collective.
To an individual, liberty is freedom to pursue happiness within the fairly regulated rules of the collective. To the social collective, liberty is aquired after the provision of the mandated guarantee of some level of equilibrium to the society.
To the individual, quantity of property is based on the individuals production. To the social collective, quantity of property is achieved based on collective output and not that of an individual. Humanity needs to ask itself: Which system motivates more production?
So, how much freedom do you want? How much socialism do you want? These are the important questions for an society to define. Our current Constitution was established to provide the utmost freedom to the individual as possible. During the early 1800's this was not difficult due to there was little advancement to define as a right or need or want. Important to know is that, the Constitution did not define food, clothing, shelter or healthcare as an right. So why does society today, struggle so hard with these issues?
What kind of society do we have when the government has taken on some level of provision and responsibility of an individuals personal wants and needs? Our government now is involved in an individuals personal healthcare, education, housing, food, retirement and charitable giving. All of these programs have an effect on the individuals motivation to produce and achieve by ones self. At what degree has the individual lost his freedom?
Society needs to step back and look at the big picture that is occuring around it. Today in america, our country is in massive debt, it has massive unfunded liabilities, it has high unemployment, high foreclosure rates, high rates of those collecting government sustenance. What really caused this to occur?
In my opinion, society needs to take an honest look at what defines individual freedom and social responsibility. It needs to be honest about what motivates an individual to provide for him/herself, what is an right and what is the true failures of our current system. Every individual needs to prepare for the possibility that the socialist mentality, that it denies exists, is occuring and failing quickly. Everyone needs to accept that his/her investment into these programs has been squandered and does not exist, that the promises its government is making cannot be fulfilled without further maluse of current resources and the freedom and resources of future generations. Every individual needs to prepare for eventual collapse of these social programs.
At what age do I have the right to live to? To the military servicemen that defend our freedoms, that life is 18. To the fetus, it is not one breath. So really, what is one individuals responsibility to another for food, clothing, shelter, healthcare and retirement benefits?
It is hard for me not to show my conservative values. It does not matter what I think, what matters is what is really happening. Mankind has faults, it has to be motivated to provide and prepare for hardships. At the same time, humans are compassionate, as an whole, we still want prosperity for our fellow man, but this first has to come at his own sweat, then we can help those in true need. Everyone needs to be honest about what kind of compassion is good and which is bad. Our country and personal freedoms survival depends on an honest view of what are personal rights and responsibilties and those of the collective.
So we humans move to some level of cooperation with one another to get our wants and needs with some form of agreement of security. This can be from a few people(band, gang, tribe etc.) to an country of billions establishing some form of restrictions upon ourselves for the greater good of the society. This manifests itself in laws, rules etc.
But, where is the fine line between a social collectivism and an individual collectivism? What are the differences? We all know that in either collective, there will be a level of responsibility by every member to protect the rights and provide common services(geared to the masses, not the individual) to each individual. This occurs when establishing national defense, police and fire protection, courts for justice, infrastructure for waste management etc.
In an social collective there are different levels. You can have a certain level of responsibility to the others, for example:
You can have a government that collects a certain amount of ones income to be redistributed to another individual, or you can have that government take all of ones income and redistribute it evenly to the whole.
But, what is an individual collective look like? In a truly individual collective, each member would be required to provide his fair share of the costs of the collective needs no matter his income. This is not realistic so that society is likely to have those earning more pay more of the cost for common services.
Defining the line between an social collective and an individual collective is important. But, we need to explore first what the difference is between an social mentality is and an individual mentality.
A social mentality will have some level of shared societal responsibility for individual wants and needs. These wants and needs are defined as: Food, clothing and shelter for basic needs to healthcare, cars, expensive houses, fine dining, electronics etc. for wants. One of the problems that occur in a society is when it crosses into providing individual needs and deciding what exactly those needs are, and what are really indiviual rights as humans?
Defining a right is different between a social collective and an individual collective. Our basic rights are life, liberty and property. To an individual, life means my right to exist at my own provision of that life. To the collective, life means the right to life at the expense of the collective.
To an individual, liberty is freedom to pursue happiness within the fairly regulated rules of the collective. To the social collective, liberty is aquired after the provision of the mandated guarantee of some level of equilibrium to the society.
To the individual, quantity of property is based on the individuals production. To the social collective, quantity of property is achieved based on collective output and not that of an individual. Humanity needs to ask itself: Which system motivates more production?
So, how much freedom do you want? How much socialism do you want? These are the important questions for an society to define. Our current Constitution was established to provide the utmost freedom to the individual as possible. During the early 1800's this was not difficult due to there was little advancement to define as a right or need or want. Important to know is that, the Constitution did not define food, clothing, shelter or healthcare as an right. So why does society today, struggle so hard with these issues?
What kind of society do we have when the government has taken on some level of provision and responsibility of an individuals personal wants and needs? Our government now is involved in an individuals personal healthcare, education, housing, food, retirement and charitable giving. All of these programs have an effect on the individuals motivation to produce and achieve by ones self. At what degree has the individual lost his freedom?
Society needs to step back and look at the big picture that is occuring around it. Today in america, our country is in massive debt, it has massive unfunded liabilities, it has high unemployment, high foreclosure rates, high rates of those collecting government sustenance. What really caused this to occur?
In my opinion, society needs to take an honest look at what defines individual freedom and social responsibility. It needs to be honest about what motivates an individual to provide for him/herself, what is an right and what is the true failures of our current system. Every individual needs to prepare for the possibility that the socialist mentality, that it denies exists, is occuring and failing quickly. Everyone needs to accept that his/her investment into these programs has been squandered and does not exist, that the promises its government is making cannot be fulfilled without further maluse of current resources and the freedom and resources of future generations. Every individual needs to prepare for eventual collapse of these social programs.
At what age do I have the right to live to? To the military servicemen that defend our freedoms, that life is 18. To the fetus, it is not one breath. So really, what is one individuals responsibility to another for food, clothing, shelter, healthcare and retirement benefits?
It is hard for me not to show my conservative values. It does not matter what I think, what matters is what is really happening. Mankind has faults, it has to be motivated to provide and prepare for hardships. At the same time, humans are compassionate, as an whole, we still want prosperity for our fellow man, but this first has to come at his own sweat, then we can help those in true need. Everyone needs to be honest about what kind of compassion is good and which is bad. Our country and personal freedoms survival depends on an honest view of what are personal rights and responsibilties and those of the collective.
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