Wisdom of Rich Dad

Most of us read Robert Kiyosaki’s Rich Dad series and then get fired up and made promises to ourselves that we are going to do something for our own financial freedom.

But days goes by, we get busy and soon enough, we forgotton what we had in mind about achieving our financial goal.  Isn’t that familiar.

How can we conquer that inertia?  I found this article a great way to affirm our objectives.  If you do it regular enough, I am sure you would have achieve some improvement in your quest for financial freedom!

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I’m sure most of you have heard of, and perhaps read the book “Rich Dad, Poor Dad” by Robert Kiyosaki. If you haven’t read it yet, I highly recommend it along with his book “Cashflow Quadrant.” Both of the books are simplistic and introductory by design. But there are some important concepts that Kiyosaki highlights that are fundamental to accumulating wealth. Here are a number of Power Affirmations that I have created based on studying his material.

One of the reasons I prefer creating power affirmations instead of just notes is that they focus my mind on the positive application of the knowledge and not just the knowledge itself. By conditioning my mind to take positive action on what I learn, positive results eventually follow.

Here some of the affirmations:

My financial intelligence is now increasing everyday. Financial intelligence is more important than money.

1) I now create regular, positive cashflow. I create money.

2) Through controlling cash producing assets whose cash exceeds my living expenses, I am on the Fast Track to unlimited abundance.

3) I don’t work for money, I make my money work hard for me.

4) I regularly study accounting and investing.

5) Today I choose to be wealthy. I choose to use my ideas and money to create ever increasing wealth and abundance.

6) I study and learn about money from people who are already wealthy.

7) When I come across an investment worth making, I ask myself “HOW can I afford it?” I am a possibility thinker.

My thoughts create new wealth generating opportunities everyday.

9) I study so that I can find good companies to buy.

10) I increase my wealth by following strategies to manage risk.

11) I pay myself first. I always pay my bills, but I pay myself first.

12) I am financially self-reliant. Through creative intelligence and planning, I now create new wealth far beyond my personal needs.

13) I write strong and sound business plans that create successful businesses that create jobs for others. I create wealth for myself and for other people.

You may have heard of using OPM, or Other People’s Money, to leverage yourself to true wealth. This wealth building strategy has worked for many investors in the real estate and options markets. But have you heard of OPT?

What is OPT?

The OPT wealth creation strategy uses the same principle, leverage, but here we are using a totally different medium – the power of the mind. The power of the subconscious mind to create a prosperity mindset has been highly touted, especially recently.

But first let’s lay some groundwork.

Today, more and more enlightened folks are achieving greater success in their lives by elevating their thoughts. When applied specifically to the realm of manifesting abundance they practice such prosperity rituals as abundance affirmations and abundance meditations. They also engage in visualization meditations to create financial prosperity.

For instance, in a quest to attract abundance you might practice advanced visualization exercises in which you picture yourself manifesting money in your life. Often specific amounts or specific material goods are visualized in the mind’s eye. For example, you might repeat positive affirmations and conduct a creative visualization in which you see $2,500 coming into your life in the next month. Or maybe you visualize yourself manifesting a new Mustang to replace your junker.

These techniques have been written about and are being practiced more and more by those wishing to develop a wealth consciousness.

Is there any evidence, though, that this abundance mentality and these prosperity affirmations can create wealth? And, if so, what is the secret wealth system, OPT, that you might use to leverage this ability?

There is now an abundance of testimonials from those who practice these creative visualization meditations and prosperity affirmations stating that these techniques have often catapulted them from debt to wealth. They often laud these techniques saying that they have become wealth magnets attracting abundance – often from unlikely sources!

Having seen the testimonials to their effectiveness, you might agree that it would be wise to start implementing some of these prosperity rituals in your own life. But, is there a way to attract abundance beyond just honing your own mental powers?

What about OPT?

OPT stands for Other People’s Thoughts. You’ve seen the power of developing a wealth consciousness in order to attain wealth. That means expanding your own mental power in order to become a wealth magnet. That is great, but why not try to leverage the mental power of two minds, or 20 minds, or 200 or even 2000 or more minds to attract wealth?

That is the power of OPT. Using other people’s thoughts means having other folks send you energy from a distance in order to create what you want in life. Of course, this principle is not limited to attracting money. It can work with healing energy, achieving success, improving relationships, etc..

I know what some of you might be thinking – “sounds like a lot of mumbo jumbo, is their any hard evidence to support these claims?” Actually, there is now a surprising number of studies that point to the effectiveness of sending thoughts at a distance.

Dean Radin, PhD, in his powerful book, The Conscious Universe, said this, “is there any evidence that thinking about people at a distance, directing either calm, loving thoughts or aggressive, malevolent thoughts, actually affects their physiology? Four decades of laboratory experiments…reveal that the answer is quite clearly yes…”

And Katra and Targ in Miracles of the Mind noted, “For over two decades, Dr. William Braud has conducted more than 30 experiments, involving over 650 testing sessions, examining the “direct mental influence of living systems.” Braud has demonstrated that it is possible for one person’s mental processes to telepathically affect those of another person, both directly and from a distance. All of these experiments in mental-influence-at-a-distance were successful, and most important, they were repeatable.”

The two quotes above are indicative of the numerous studies that now point to the effectiveness of sending energy to others. But, how can you use this knowledge to help yourself and others?

Why not form a group and start sending each other energy. From the results of the studies it appears that distance is Not a factor when sending the energy. This will allow you to indiviudally hone your creative visualization skills while at the same time attempting to manifest the dreams of those in your group.

You might mix it up and send different energies in different months – love energy one month, abundance the next, healing the next and so on. Or, create a group focused on just one energy, say healing or attracting wealth.

by Mika Hamilton

In today’s current investment markets, there has been an increase in the number of individuals deciding and adhering to an investment plan. Perhaps this is caused by the drastic increases in the cost of living or the profound insecurity about the future of social security, and retirement funds. Many families are looking for investments plans which help them build two funds – one for the future and one for the present. Most people are not interested in purchasing stocks and bonds. This is both time consuming and complicated.

Investment plans essential allow the an investor to buy a set number of stocks, bonds, and securities. Purchasing is done on a regular and consistent basis. Funds for the investment are taking directly from a check, savings, or money market accounts automatically. These money is used to buy stocks and bonds that were pre-decided upon. For the most part you can change any of variables at anytime. These variables include amount, frequency, and what stocks are bought. There may be fees associated with changes. Make sure these fees are known before you sign your contract with your broker. However, if you are looking for more freedom most online investments firms allow you to change your variables anytime for free.

The next important step in an investment plan is figure out how much money you would like to invest.

It is a good idea to have a household budget. This will allow you to clearly analyze how much extra money is available for investing. Due to the long term nature of investment plans, you would suffer a financial lost if you had pull out early because you invested more money then you could afford. Make sure the amount you pick is readily available for each time the investment comes up. Remember just because you have extra money now does not mean in the future you will. Many investors come up short several months after starting their investments plans because they did not budget for an emergency fun. If you do feel you are at point where you can not no longer make a regular investment more investment companies will allow you to reduce or hold the next schedule investment.

Now you know how an investment plan works and you have the money to invest. The next question is how do you decide what to invest in. Research is the key component to this step. It does take time to decide but it is well worth the effort. Make sure you find stocks that have a history of performing well in the long term. At the time of purchase they may be expensive however they will probably also continue to increases which will directly benefit you. As you feel more and more comfortable with investing feel free to add more stocks and bonds to your portfolios. Many financial experts believe that diversification is a great way to increase your investment profits.

Investment plans are a great for the casual investor to make safe, low risk investments which will lead, in the long term, to increased profit and financial stability.

by Jake Bernstein

In order to make money in stocks, a trader has to be aware of two key factors: price and timing. Though many traders are good at discerning the trend of a market, their timing is often poor. Although they may know that a stock will move in a given direction, they find it difficult to profit from that knowledge because their market entries and exits are timed incorrectly. Timing is the most important consideration for a short-term trader, trumping even price. In Hot Stock Market Strategies (Entrepreneur Press, February 2005, $19.95, Trade Paper Original), market expert Jake Bernstein teaches traders to recognize and profit from seven basic timing indicators.

1. Moving Average Indicators. A stock closing above its average is a buy signal, whereas a stock closing below its average is a sell signal. This method lets traders get in on a trend after it has started and ride it to the end. However, the lag time may be detrimental, as it forces traders to enter late and leave late.

2. Stochastics and the Relative Strength Index. These mathematical formulas, described in more detail in the book, identify tops and bottoms of trends as well as indicate when a stock appears to be overbought or oversold.

3. Chart Patterns and Formations. These highly visual indicators are logical and allow anyone to observe a stock’s trend. However, it is difficult to objectively test for accuracy.

4. Parabolic. This mathematical formula provides traders with two values each day, a “sell number” and a “buy number.” When a stock reaches the buy number, traders should go long and close out short, whereas the sell number indicates close out long and go short.

5. Directional Movement Indicator. This indicator measures the strength, not the direction, of a market trend. It is most useful in conjunction with other indicators.

6. Momentum and Rate of Change. When momentum crosses above its zero line from a negative reading, a stock is considered to be in a bull trend. When momentum crosses below zero, the stock is in a bear trend.

7. Accumulation Distribution. One of the more important indicators, this gives a measure of whether the market is overall bullish or bearish.

A combination of two or more of the above strategies can give a short-term trader a fairly accurate general picture of the market and give some guidance as to the trader’s actions. Jake Bernstein gives examples of these indicators, as well as more in depth explanations, in Hot Stock Market Strategies, now available from Entrepreneur Press.

Jake Bernstein has been involved in the stock market since 1968 as an investor, analyst and consultant. He is the author of more than 35 books on trading and investing, and his expertise has been sought by the Wall Street Journal and other national media. His latest book, Hot Stock Market Strategies, covers four short-term trading strategies and one day trading strategy, as well as giving an overview of the stock market

by Alexander Korablev 

Do you believe that the world economy will grow? Do you believe that US economy will grow? I do.

The major stock indexes are indicators of economy grow. You can make money use this opportunity buying index funds.

Investing into index mutual funds is easy, interesting, and profitable. It takes 5 minutes every month! If you are long-term investor, index funds is for you!

It doesn’t matter what index you choose. This index will grow due to economy sector grow rate. There are many indexes in the world. But how to get money from indexes grow?

There are many indexes mutual funds. Fund share price change accordance index performance. There are thousands of mutual funds have S&P 500 as a base of their portfolio. The differences from one fund to other are operating company and expenses. Choose fund with fell known operating company and smallest expenses.

Small expenses are very important. If fund have big expenses, the managers steal investors’ money. Index fund manager don’t buy expensive stock market researches, don’t arrive at a difficult decision witch stock to buy. Index fund manager buy stock included into index only. It isn’t expensive!

The best investment strategy for indexes mutual funds is to invest some dollar amount monthly. And be the long-term investor – invest for 10 years or more. Our computer modeling of this strategy shows that you will receive profit, if you invest on monthly base during 10 years. I can’t give you guaranties that you will get profit but the probability of this is close to 100%.

And the last, if you can, diversify you portfolio. Divide you portfolio into three parts. Buy large capitalization company index fund (S&P 500, DJA), small capitalization index fund (S&P 600) and developed market index fund or international index fund. It makes you portfolio more profitable and more stable.

The very first kind of investment that I have been exposed to is in stock market.  And guess how I started?  Through co-works at the work place who discuss about their profit and tips during lunch hours and breaks.  Soon enough, I was influenced and bought some shares on the “advices” given by co-workers.

Does that happen to you too?  You invest into the stock market because your friends talk about it and recommended you some good information?

How should we then evaluate our stock investment?

MangingMoney.com has the following 8 points:

You should thoroughly analyze a stock before purchase. However, if you pick up a company’s annual report you can quickly become overwhelmed by all the numbers. What figures should you concentrate on when evaluating a stock? At a minimum, you should look for answers to these eight questions:

• What are the company’s earnings? Earnings per share (EPS) is the company’s net income after taxes and preferred stock dividends divided by the average number of shares outstanding. Look for steadily increasing EPS, which shows a pattern of consistent growth.

• How does the company’s price relate to earnings? The price/earnings (P/E) ratio is calculated by dividing the company’s stock price by EPS. It basically indicates how much investors are willing to pay for a dollar of the company’s earnings. P/E ratios can be calculated using different earnings numbers. Trailing P/E ratios use earnings per share for the most recent four quarters, while forward P/E ratios use forecasts of future earnings per share. To get a feel for the reasonableness of a company’s P/E ratio, review its historical P/E ratio, the P/E ratio of other companies in similar industries, and the P/E ratio of the market as a whole.

• How does the company’s book value relate to its price? A company’s book value equals its assets less its liabilities, commonly referred to as stockholders’ equity. Dividing the stock’s price by its book value per share will give you the price-to-book value. Companies with low price-to-book values are often considered value stocks.

• What is the company’s return on equity? Return on equity (ROE) is calculated by dividing the company’s income by its shareholders’ equity. It is used to measure how well a company is utilizing capital retained in the company.

• What is the stock’s total return? Total return equals dividends plus or minus changes in stock price divided by your purchase price. This is the overall measure of the stock’s performance and is useful when comparing one investment with other investments.

• What is the company’s debt level? The debt ratio is the company’s outstanding debt divided by shareholders’ equity, which measures how leveraged a company is. High levels of debt can make a company more vulnerable during economic downturns. Also take a look at the current ratio, which is calculated by dividing current assets by current liabilities. It is a measure of a company’s ability to pay its current obligations.

• What is the company’s growth rate? A company’s growth prospects can be evaluated using the price/earnings growth, or PEG, ratio, which is calculated by dividing the P/E ratio by the company’s projected earnings growth rate. A PEG ratio of one is considered standard, meaning the growth rate is incorporated in the stock’s price. A PEG ratio higher than one means the stock is trading at a premium to its growth rate, while a ratio of less than one may mean the stock is undervalued.

• How volatile is the stock? Beta is a statistical measure of how stock market movements have historically impacted a stock’s price. By comparing the movements of the Standard & Poor’s 500 (S&P 500) to the movements of a particular stock, a pattern develops that gauges the stock’s exposure to stock market risk. The S&P 500 is an unmanaged index generally considered representative of the U.S. stock market and has a beta of one. A stock with a beta of one means that on average it moves parallel with the S&P 500. A beta greater than one means the stock should rise or fall to a greater extent than movements in the S&P 500, while a beta less than one means it should rise or fall to a lesser extent than the S&P 500. Since beta measures movements on average, you cannot expect an exact correlation with each market movement.

The decision to purchase a stock can’t be made solely from a review of financial ratios. You will also need to evaluate subjective factors, such as the quality of management, prospects for the company’s industry, and where the company stands in relation to its competitors.