YOUR PAD - A HOUSE OR A HOME?

It's interesting being invited into people's homes not only to receive their hospitality but also to gain a greater insight into their characters by observation. Just looking around a home tells it all. Maybe there is a bookcase with a preponderance of craft books or paintings on the walls of some special artist or a piano with some classical music ready to play. The lounge may be comfortable and lived in or it may not be inviting. Often it appears that people match their type of furniture and so we could go on.
It got me thinking that house maintenance means one thing to one person and something totally different to another. One section of the community treats their houses very casually. They usually wait until something has broken or the paint starts flaking off before they get around to fixing the situation. Others are so house proud that every speck of dust is chased off the premises and the paintbrush is poised to obliterate every spot or blemish. Again some people are never satisfied with their house. They are continually upgrading and buying items to titivate it up.
It always interested me when I was in the lending game for housing to observe the modus operandi of young couples about to purchase their first house. Some would opt to buy a broken down old house determined to spend the next decade pulling down walls and renovating from top to bottom. Other young couples would mortgage themselves up to the hilt to buy their dream house so that they could walk in with nothing to do and then work like crazy to reduce the mortgage to a reasonable level so that they could eventually raise a family.
There must be a better way and I suggest a middle of the road attitude can be helpful in determining how and when we should maintain or upgrade our property. I like to walk in and around the house pretending I am a Real Estate agent looking for deficiencies jotting down things to be done. Then I try to put them in order of priority determined often by the cost involved and finally setting target dates for completing each task.
Once you set yourself a task and complete it there is great satisfaction generated.
That's my theory anyway but I hope my wife doesn't read this - I might be painting instead of writing. Someone said, "Those who can, do, those who can't, teach!"

IS THERE A BETTER WAY?

Is there a better way? If so, do I want to change?
Fred Smith, the famous consultant, said that when called into a sick Company he always looked for one of two attitudes, either IGNORANCE or CONCEIT. If it was ignorance he heaved a sigh of relief. They could easily be taught the right principles and practices. But if it was conceit, "We have done it this way for umpteen years", or "Nobody can teach us anything", he would give up.
There seems to be an "Effective Curve" that operates on about a five-year cycle. It may be a business, a project or our household financial plan; we start off with high hopes being innovative, enthusiastic, creative and eager. Things happen, life is rosy and our effectiveness rises sharply. Then we start to ease up and allow inefficiencies to creep in. We learn to coast along on past successes and in fact look backwards instead of forward. Then the curve starts downward until we often can end up where we started, ineffective, disillusioned, a life of tedium and totally lacking in excitement.
It's good to evaluate just where we are on the effectiveness curve so we can take immediate, corrective action if necessary.
A famous aircraft engineer has a picture of a large bee in flight with this caption. "Aerodynamically it has been proved conclusively that the bee cannot fly but the bumble bee doesn't know it and just goes on gathering honey."
A great many people over the ages have "proved conclusively" that this or that could not be done only to wake up too late to discover somebody has done it and like the bumble bee gathered the honey. Maybe we need a few lessons on "Creative Thinking" just to get us back on the upward curve again.
Here's a little test to see whether you limit your thinking by assuming requirements that are not asked for and may not even exist. Draw nine dots in the form of a square. Now you are asked to draw four straight lines so as to intersect each dot. You must not cross any dot more than once, not retrace any line not lift your pencil from the paper until all nine dots have been crossed.
Don't give up - it can be done - only you have to start thinking laterally. However thinking is not sufficient. Creativity needs to be applied. Our country needs original thinkers, not a bunch of robots who only do what they are told. We need those who are prepared to be innovative, think outside the square and willing to test out and improve until like the bumble bee we gather enough honey to set our economy straight again.

FOUND ANY DIAMONDS LATELY?

One of the most famous lectures ever delivered was the one made 5700 times by the American, Dr. Russell Conwell. The name of the speech was "Acres of Diamonds" and I think we can learn something from the moral. The fable was told to him by an Arab guide he used on a tour of the Middle East in 1870. It concerns a poor Arab who was told by a Buddhist priest how the world was created and how all the minerals and gems came into being; that diamonds were among the last of the precious stones to be made and that they were in fact congealed drops of pure sunlight. The poor Arab, made disconent by the story of the diamonds, asked the priest where they were to be found. Told to look for rivers that run over white sand, the Arab sold his farm, left his family with relatives and began the search. After years of fruitless searching and ultimately becoming penniless, he killed himself.
Then one day, the new owner of his farm, took his camel to a stream running through the property. While the camel drank he noticed a gleaming rock in the river, retrieved it and took it to the house.
Coincidentally the same priest who had sent the Arab on his search for diamonds came around for another visit, noticed the diamond and helped the farm's new owner retrieve fabulous stones that soon adorned the crowned heads of Europe.
There were indeed acres of diamonds on the poor Arab's farm. But he did not look in his own garden. He missed finding the diamonds in his own back yard.
I wonder if you are still looking for the pot at the end of the rainbow? Too often our own circumstances seem mundane - we never seem to have enough money to satisfy our wants and we go searching for some get-rich method that will solve all our problems in one fell swoop.
I believe that is why the share market is artificially propped up by the thousands of investors who want to get rich quickly even if it means borrowing to do so. Recent history has been studded with booms and busts and the '87 crash brought many investors to their knees.
Some investors enjoy the cut and thrust of speculation and have the flexibility to ride the highs and lows with equanimity. Others are more intense and are either in a state of euphoria when their shares gain a few points or suffer ulcers when they take a dive. The large remaining group of investors if asked, "Do you want to sleep easy at night or are you prepared to take the risk for high returns and wouldn't worry too much if you lost out", would plump for security every time.
I believe there are diamonds in our own back yard. A big one is the ability to learn how to live within the income we receive. The second is to plan our spending in such a way that we have sufficient surplus to save for the necessities of life without using easy credit. But the most sparkling diamond is reserved for those who are willing to help the poor and needy - those who have no access to the things in life that we take for granted.
Hope you discover a few diamonds in your back yard that you can share with others.

MONEY IN PERSPECTIVE

I have hust read about a thrifty young woman who became concerned over the lavish amount of money her boyfriend was spending on her. After an expensive dinner date she asked her mother, "What can I do to stop Bill from spending so much money on me?" Her mother replied simply, "Marry him!"
Is that an unfair generality or a very perceptive comment on the state of our Kiwi male who within a year of marriage reverts to type and becomes buried in the dull routine of existence. As far as the purse strings are concerned he is likely to pursue one of two directions. Either he says to his wife, "I'll make the money - you handle the pay packet. Mind you any overtime or extras usually finds its way into his hip pocket.
The other option is for him to keep tight control of the chequebook so that his wife has to plead when she needs money to buy a new outfit.
Very seldom do I see a totally shared responsibility when it comes to handling the household finances. Yet this is the very essence of good money management.
Take two people, one male and one female, from totally different homes with different upbringings and experiences each with different likes and dislikes, each with some degree of independence and self-centeredness living in the same house with different tasks and responsibilities trying to work from the same budget and trying to meet the same goals. Will they agree on everything? Not in your life! Despite their firm commitment of love and loyalty these differences make some degree of conflict inevitable. There are more disagreements about handling of money than possibly any other subject.
So, what should a young couple do when setting out on life's journey? I would like to see them take these steps:
1. Get some expert advice to set up their initial financial plan.
2. Open the required number of joint Bank accounts with either to sign.
3. Enrol in a few courses like cooking classes for low-cost meals, repairs and maintenance etc. and teach each other these skills.
4. Start right from scratch while there are two incomes to save a healthy deposit on their first home.
5. Take it in turns to decide what will be the next financial goal to save for but put a ceiling on the limit.
6. Have a family conference every few months to discuss finances, evaluate progress, allocate tasks and modify plans.
7. Plan an annual holiday and decide where to go and how much it will cost. Then save specifically for the holiday.
8. Above all, get some enjoyment out of your hard-earned money and use it for innovative purposes. Give each other a surprise present apart from birthdays and Christmas.
Enjoy a dinner out on occasion. The reciprocal rewards will be great!

PERSONAL FINANCES

I wonder what your Personal Finances are like. Have you found Financial Freedom for your family? If not do you realise that careless management of your finances can produce stress in the home, debt depression and even separation. Lack of planning can induce:
* Compulsive or impulsive spending
* Leaving it all to the other partner
* Trying an inferior system that won't work.
* Establishing plans that aren't followed
* Establishing unrealistic plans.
* Buying now, paying later "with interest."
There is a better way. For many years I took Personal Financial Seminars showing people how to plan expenditure for the ensuing twelve months - how to set up a system using three Bank Accounts so easy that a 12-year old could operate it - plus many tricks of the trade to reduce expenditure etc.
Over the years I have processed a few thousand Personal Financial Plans using my computer by interview and mail order and many are operating this system successfully. The problem was that all you got was a printout and diagram to set the system going. But when changes in expenditure or income came it was awkward to revise your figures. Now I have great news. You can have a plan on your own computer, make your own adjustments and print out your financial plan for the year.
DO-IT-YOURSELF FINANCIAL PLAN;
I've put my plan on computer disc using Microsoft Excell and am making it available for purchase. The disc has full instructions and hints that you can print out. All you need is to insert your Regular Committed Payments on the Financial Plan, then insert the amounts you require for Housekeeping and Allowances - then alot an amount for Contingencies and Holiday Spending. Finally insert all Income.
Trigger the calculating icon and up comes a weekly surplus or shortfall. Whilst on the computer you can make adjustments to balance the budget with a reasonable surplus.
But all the instructions are on the disc to take you right through to a completed plan for the ensuing year.
There is a Setting Up Diagram that automatically includes your figures so you can set the system going with your preferred Bank. Retaining the Plan on your computer allows you to make necessary adjustments and gives you the capacity to make larger spending decisions. Revised figures put in will determine if you would still have a reasonable surplus.
To order a disc:
Send Name, Address and Phone No. plus a cheque for NZ$40 made out to Tranzsend and post to
Buck Pound,
50 Magnolia Lane,
Wilson St., THAMES 2801
New Zealand.

ADVICE

Where do you go these days for general advice that (a) doesn't cost you the earth and (b) hasn't someone on the other end with an axe to grind? Again how do you separate Financial Advice, Legal Advice and Consumer Advice?
Things are getting a trifle complex for Mr. & Mrs. Average who spend the bulk of their time making an honest living and raising a family to do likewise. They usually don't have the time or inclination to read up all the current available literature. However when a sudden emergency arises, who are they to turn to. I've been asked all sorts of questions - some relatively easy to answer but some really curly ones that over stretch the memory banks and resources.
For instance, one couple came to me who were leasing glasshouses and having hassles with the landlord. Their Solicitor recommended court action but with lack of montary resources to pay legal expenses they could well end up flat broke. So they were directed to the Family Court to endeavour to have the matter sorted out amicably.
Another couple wanted to know whether they could afford to separate. I did individual feasibility budgets on the computer but with the extra expenditure on one income each revealed an unhealthy shortfall. I then asked if I could do a combined one and even though finances were the problem, up came a healthy surplus. My instant advice was, "Why not stick together and sink your differences?"
Those appoaching retirement usually come up with a spate of queries. It's going to be a totally new ball game so shall we sell the big house and purchase a unit or beach house. Shall we invest the maturity proceeds of our Life Policy or clear the house mortgage? Investment advice is a hardy annual. There is such a variety available with so many institutions competing for the surplus dollar that it can be confusing to the uninitiated.
I have a few basic rules I endeavour to abide by:
1. I remind myself that I am operating under a legal "Duty of Care", thus I can be accountable for the advice I give.
2. I try not to give generalised advice without seeing the present financial situation in toto. So often the gut feeling advice would be inadequate when the present financial situation demands another course of action.
3. I endeavour to bat ideas around showing the reactions and possible results of certain courses of action.
4. Ultimately I say, "It's totally up to you now - you've heard the pros and cons - you choose!"
So, if you can find a financial advisor who has a wide knowledge, political skill and above all moral credibility, my advice is to listen carefully, weigh up the pros and cons then make your final decision. Proverbs 12:15 has the last word, "The way of a fool seems right to him but a wise man listens to advice."

WHERE ARE YOU GOING FINANCIALLY?

Most couples don't seem to be going any place. If you ask them what their financial goals and objectives are they usually give a nervous laugh before answering, "Just keeping body and soul together," or "We're keeping the wolf from the door," or "With the help of our friendly Bank Manager we are making ends meet."
It's a tragedy that money dominates our lives to the extent that there never seems enough to satisfy our desires. The more we have, the more our needs and wants close the gap between income and expenditure.
So the first question I wnat to ask you is:
Where are you now financially?
It can be quite a frightening question because in come cases it will reveal how unpleasant or serious the problem really is. Indeed many people are totally incapable of answering that question. They literally don't know how to find out.
The same question could be legitimately asked of many small businesses. Some don't realise that they are in a deteriorating situation until it is too late for a rescue operation. Others have a hunch that all is not well and hope against hope that some miracle will hapen to reverse the situation. The only way to answer that question is to spend sufficient time to work out the present financial situation, "What I own minus what I owe."
The next question is:
Where are you going financially?
You and your family are on the journey of life. A journey begins with knowledge and proceeds with action. Knowledge of where you are is essential. Knowledge of where you are going is just as vital. With the two in mind you take action. The answer to the second question is to work out a budget for the first twelve months. A budget plan is the proposed expenditure and income over the ensuing year that will give a weekly surplus or shortfall. It is as clear a picture as can be worked out in advance of how objectives will be reached financially. It's like a road map before a journey in a car.
Once a budget plan is developed, the discipline of sticking with it can be played like a game and enjoyed rather than a gritting of the teeth in sheer determination. The basic thrust should be adhered to but adjustments should be made to maintain flexibility. Remember that any action begins with the first step.
Ask yourself:
1. Where do I want to be financially? (What are my goals?)
2. Where am I now? (What is my Financial analysis?)
3. How will I reach my goals? (What is my budgeted Surplus to enable me to achieve my goals?)

PAYING YOUR DEBTS

There's a generation growing up knowing nothing of the Biblical adage to "Owe no man anythng." National debts keep on rising and the future of our youth has already been mortgaged.
When a country can't pay its debts the rot seems to filter right through the economy. I venture to say that if it became mandatory for all Companies to pay all debts by the old tradional 20th. of the month a large proportion of them would go under. Many a small man has been forced into bankruptcy because big firms wouldn't pay them on time.
However it is personal debt that is my special vendetta. For many years now I have had a mission in life - that is to reverse the trend and show people how to get rid of debt and enjoy that special privilege of paying bills as they come in. Maybe if enough people learned this habit the cumulative result would cure our country's ills.
Every year thousands of families are destroyed because of financial bondage. They encumber themselves with debts beyond their ability to repay. Every family has a "point of not return." If they borrow up to this point and some emergency tips them over, they lose their capacity to climb back again.
Too many times I have put figures on the computer to discover that not only is expenditure exceeding income but liabilities exceed assets. It's a no-win irretrievable situation that leads to insolvency and more often than not the break up of the marriage. Why do so many people fall into this trap? And I'm not talking about the compulsive spender or alcoholic. I've had professional and business people succumb to this temptation of borrowing more than their capacity to service. Proverbs 22:7 says, "The rich rule over the poor and the borrower is servant to the lender." So what do you do if you find yourself loaded up to the hilt with debt?
Firstly you need to set aside a night to pull all those bills out of the drawer and write down every thing you owe leaving the first mortgage out. Add up the whole raft so that you arrive at the total. Then add on a comfort level amount like $1,000 so now you have a target figure to aim for.
Secondly you need to acquire a mind-set about debt and determine that once you have extricated yourself from this bondage you will never, ever use easy credit again but save up for future purchases.
Thirdly you need to work out an economy budget eliminating all unecessary expenditure and reducing other expenditure. The housekeeping is the great variable and usually can be reduced with ease.
After you have the best weekly surplus you can achieve and maybe supplement this with overtime or extra work, go like crazy to pay off the debts. Try to eliminate the smallest ones first and have a little celebration with each finally repaid.
If you have any assets that you do not absolutely require then have a garage sale to get rid of a few more debts. It may be a long haul but don't give up as you will win out in the end.
Keep going until you have that $1,000 as a nest egg buffer.