Wisdom of Rich Dad

Money alone does not solve your money problems — financial intelligence does.

This is according to world best selling author Robert Kiyosaki, who will be in the country next week to promote his new book Increase Your Financial IQ.

In his book he says it is not the love of money that is evil, but the lack of it that causes evil. With the current high interest rates and soaring petrol and food prices, many consumers are finding it difficult to service their debts.

According to online money advice company www.justmoney.co.za South Africans use as much as 75 percent of their income to service debt.

The old adage, “knowledge is power”, has never been more relevant now as many people are selling their homes and cars to survive.

A recent survey by www.justmoney.co.za shows South Africans are cutting back on partying and eating out, by as much as 40 percent, as they watch their pennies.

Trim the Fat Off Your Spending

Getting out of a financial pickle is as easy as getting in it. It starts with changing your habits. Start by cutting out luxuries.

~ Abdul Milazi

Robert Kiyosaki on KTLA News on real estate.

Robert Kiyosaki explains why many commonly held truths about managing money are obsolete. In their place, he offers financial solutions anyone can follow.

“Investing,” he points out, “is not risky, but following bad investment advice is.

* Your future is created by what you do today, not tomorrow

* The size of your success is measured by the strength of your desire; the size of your dream; and how you handle disappointment along the way.

* The only difference between a rich person and poor person is how they use their time

* Academic qualifications are important and so is financial education. They’re both important and schools are forgetting one of them.

* The poor, the unsuccessful, the unhappy, the unhealthy are the ones who use the word tomorrow the most

* I have a problem with too much money. I can’t reinvest it fast enough, and because I reinvest it, more money comes in. Yes, the rich do get richer.

* Do today what you want for your tomorrows

* Tomorrows only exist in the minds of dreamers and losers

* The most life-destroying word of all is the word tomorrow

* A lot of people are afraid to tell the truth, to say no. That’s where toughness comes into play. Toughness is not being a bully. It’s having backbone.

* Money is kind of a base subject. Like water, food, air and housing, it affects everything, yet for some reason the world of academics thinks it’s a subject below their social standing

* We go to school to learn to work hard for money. I write books and create products that teach people how to have money work hard for them.

Let’s face it; we all don’t make millions of dollars a year, and the odds are that most of us won’t receive a large windfall inheritance either. However, that doesn’t mean that we can’t build sizeable wealth – it’ll just take some time. If you’re young, time is on your side and retiring a millionaire is achievable. Read on for some tips on how to increase your savings and work toward this goal.

Stop Senseless Spending
Unfortunately, people have a habit of spending their hard-earned cash on goods and services that they don’t need. Even relatively small expenses, such as indulging in a gourmet coffee from a premium coffee shop every morning, can really add up – and decrease the amount of money you can save. Larger expenses on luxury items also prevent many people from putting money into savings each month.

That said, it’s important to realize that it’s usually not just one item or one habit that must be cut out in order to accumulate sizable wealth (although it may be). Usually, in order to become wealthy one must adopt a disciplined lifestyle Read the rest of this entry »

Last night I happened to catch an episode of “Larry King Live” which included a feature on the current housing crisis along with a panel of participants including Robert Kiyosaki, author of ‘Rich Dad Poor Dad’, and Donald Trump.

While the stats by now are known to most people – The Shiller Home Price Index was down 15.5% for April ‘08 vs April ‘07, and over 1 Million foreclosures have been filed with many many more expected, the real overarching questions were a) is this a good time to sell and if you have to sell then what can you do to sell, b) what do you do if you are a homeowner facing foreclosure, and c) is this a good time in terms of opportunities to buy and invest?

The unanimous consent amongst the parties was pretty much as follows

a) This is not a good time to sell obviously and if you do not have to sell then you shouldn’t. If you do have to sell then you can sell if you price your property appropriately. This means first of all IGNORE what other homes are listed for, the only thing that matters is what homes have actually SOLD for recently as a valuation bench mark. If you must absolutely sell then discount your home 20% below current market value and you will find that it sells very rapidly. The bottom line is that it is not that there are no buyers, it all boils down to the numbers.

At our business we have been working diligently for the past 2 years, communicating to our sellers that the one thing that is more important than anything else in determining whether or not a listing will sell is price. We have some listings that have lingered without activity for a year where sellers simply refuse to face the realities of the market, and then other listings that are selling in a week, because in those cases the sellers are realistic and follow our advise. The Sarasota real estate market is what it is and if you ignore market realities then you simply will not sell.

b) If you are a home owner in trouble the resounding agreement was that the very worst thing you can do is ignore the lender when you get your notice. Lenders do not want to own your home, and they are willing to work out loans with home owners and today you have a lot of leverage as a owner in renegotiating your loan. The only predicament today is unfortunately that lenders will not discuss your loan until you are at least a couple of months late. Once you are late however you will find that you have the ability to get the lender to agree to work with you so you do not lose your home.

In our business we are working with a lot of short sales and I do see many lenders making amazing concessions. Some lenders are Read the rest of this entry »

By Weamein Yee

In times of economic distress, investors flock to safety.  The bond market usually acts as a safe harbor for many investors but the precarious financial position of many bond insurers has many shying away from corporate and municipal debt.

Since last summer, demand for treasury securities as well as the Fed’s rate cutting campaign, has steadily driven down yields.  Demand for 1 month T-bills has been especially brisk, with a number of money market funds reluctant to invest in short term commercial paper.

Back in March, in the wake of the near collapse of Bear Sterns, the yields on 1 month T-Bills fell to 0.27%, it’s lowest in over half a century.  Yields recovered slightly in the beginning of this month but are once again below 1 percent.

With many institutional investors feeling that the stock market hasn’t hit it’s bottom yet, the short maturing T-Bill gives them a safe haven to tide their money away until they feel the time is right to jump back into stocks while sacrificing very little liquidity.  The Treasury Department has also decreased the minimum face value of it’s securities to $100, down from $1,000 as of April 7, which makes it viable purchase for a larger number of investors.

Keep in mind that this is all taking place while inflation is on the rise and that the “real” yield is actually negative.  What we have now is an upward sloping yield curve, which is a favorable situation for banks.  Banks are able to borrow short at lower rates and lend long at higher rates.  Depending on how inflation plays out, long term interest rates may even rise further in the near future.