Wisdom of Rich Dad

1. Boost consumer confidence. The very public food fight between Republicans and Democrats has been terribly damaging to public confidence. Our “leaders” need to discuss their differences in less hostile ways, reach a solution, and give Americans some reason to trust that their national government has their best interests at heart. Even if sharp differences remain, Congress and the White House should abandon their scorched-earth politics.

2. Agree on a long-term deficit reduction plan. Yes, this is a no-brainer. But we haven’t seen one yet. To be credible, the plan must address healthcare and other entitlement programs. Don’t expect seniors to applaud fiscal restraint that comes at their expense. But they know cuts are coming and will accept them, particularly if accompanied by higher taxes on wealthier Americans. Shared sacrifice must be apparent.

3. Start fixing the mortgage mess. It will take years to work off the excesses of the housing bubble. But the clock won’t start moving in earnest until and unless the government does a more effective job of speeding the review of troubled mortgages and helping to get them cleared off the books. These mortgages are a toxic overhang to a housing recovery, and the lack of home purchases and new-home construction is a huge drag on the economy.

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It is my passion to be a continuous learner. Here are some key financial lessons I have learned from financial experts.

David Chilton, author of “The Wealthy Barber,” a personal finance book that sold more than 2 million copies in the 1980s, taught me that compound interest is my greatest and most gracious friend when it is working for me and can be quite a vile enemy when it is working against me. I read this book when I was a teen, and it set the course for me to be a lifelong investor.

William Danko and Thomas Stanley, authors of “The Millionaire Next Door,” conducted detailed research on the financial habits of individuals worth $1 million or more. They taught me that most millionaires do not “look” like millionaires, and that most millionaires have started businesses or view their personal financial investments as a business. As such, millionaires are highly interested in acquiring assets that build net worth.

Robert Kiyosaki, author of “Rich Dad Poor Dad” and “The Cashflow Quadrant,” opened my eyes to the importance of viewing items as liabilities or assets. Robert challenged me to ensure that a large component of my assets is focused on investments that produce profits and net worth growth regardless of my ability to work. This lesson has easily been one of the most influential in my life.

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Think about the last time someone gave you a compliment. It could be your boss, your friend or even a stranger on the street. What was your reaction? Did you graciously receive the compliment and reply with a heartfelt “thank you”? Or did you stammer and find it difficult to accept the compliment? Or maybe you would try to discredit it by saying, “Oh it was nothing really”, or “It was all HIS idea…or HER idea…not mine?”

If you said “yes”, you’re not alone!

Since young, we have been taught to be humble and not brag about our accomplishments and wealth. This is especially true if you’ve been growing up in Asia, where unconditional humility is a common practice. For example, when we visit our relatives, our parents would always remind us to give compliments to our elders the moment we step into their homes, before we expect to receive anything in return.

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Having a car accident is often a big headache — literally sometimes from the crash itself, but almost always figuratively as well. Making calls to the insurance company, completing mandatory paperwork and being without your car while it’s repaired are all nuisances.

Ensuring your car is repaired correctly requires more than just handing over the keys to a local body shop. You must make sure you are satisfied; if you have complaints later, you might find yourself in a debate with the body shop or your car insurance company. Here’s how to ensure the auto body shop has completed the repairs correctly.

Be proactive from the start. If you don’t have personal experience with body shops in your area, ask friends or co-workers for recommendations and read reviews of other customers online. Once you’ve chosen the body shops to get quotes, have them go through exactly what they see that needs repair and have them explain the repair process.

Ask questions if you don’t understand any part of the process. A good shop will clearly explain what needs to be done to return your car to its original condition. Ask what the shop’s warranty policy is, and get a copy of it in writing.

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My son took out a Sallie Mae loan for college expenses. To my astonishment, I found out that I was a co-signer. I don’t recall ever co-signing the student loan documents. Sallie Mae says I have to repay the loan and that I am completely responsible for it. It sends me a statement every month and is now threatening collection action. They have not asked my son for a single penny. Although the loan is only for $6,000, shouldn’t Sallie Mae try to collect from my son first before going after me?
– John Juice

Dear John,
I think your first step is to review the loan documents. Sallie Mae didn’t dream this stuff up. They’re contacting you for a reason. If you don’t have ready access to the loan documents, I’d suggest contacting the Office of the Consumer Advocate at Sallie Mae.

Without specifically referencing you, I discussed the issues surrounding the loan with Patricia Christel, a spokeswoman at Sallie Mae. Her assistance was invaluable in helping me to frame this reply.

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An Auckland school has this week provided thousands of parents with a glimpse at the future of education – and it’s an expensive one.

This won’t come as a surprise to many – most parents will attest to the cost of putting their children through school, particularly with the ever-increasing price of uniforms and stationery materials.

However, what may raise a few eyebrows is Orewa College’s decision to place the latest model of Apple’s iPad on its “compulsory” stationery list for Year 9 students next year.

It’s hard to see the majority of Wanganui schools going the same way, at least in the short term.

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