From Ramoncito:
What does it take to become a millionaire?

INQUIRER.net
First Posted 10:12:00 05/20/2008

(This is part of Take Charge of Your Money , a partnership between INQUIRER.net and Citibank to help readers handle their personal finances well.)

Question: What does it take to be a millionaire? With my modest income, it seems a near impossible dream for me. I can't imagine being able to save up enough money to be one. – Lisa S.

Answer: These days, the day time and prime time game shows on TV are raking in the audience and the advertising support — 1 vs. 100, All-Star K!, Gobingo, Pilipinas Game K N B?, Singing Bee, Wheel of Fortune, etc. Filipinos are tickled pink at the thought of taking a chance at becoming a millionaire in one day.

Lotto outlets also get long queues when there’s an upcoming super lotto draw. People, from the low-income to the middle-income classes, are lining up in hopes of winning the elusive jackpot.

But the chances of winning in game shows and lotto draws are very slim. Instead of dreaming about becoming a millionaire through these schemes, choose to work on becoming a millionaire yourself. No, Lisa, it’s not too far out to dream of becoming one.

Look around you. There may be millionaires you already know living in your neighborhood or going to the same office as you do. These are the people who live in their own homes with their own cars, whose assets total more than P1 million. Whether or not they feel like millionaires is up to them. But the crucial factor is that they have built up an asset base valued at over P1 million. It is an attainable goal.

There are the really rich and visible millionaires who are business taipans. When you read their life stories, you’ll be struck with the fact that some of them were born poor. If they made it from rags to riches, there’s no reason why you can’t try.

To reach that goal, you have to learn the secrets of millionaires. Here they are:

1. Treat money as something to save and invest. The minute you receive your paycheck or a windfall (example, an inheritance or a bonus), think of how much you can put away as savings. Then look for venues where you can invest your money. If you think this way, you won’t be tempted to splurge money.

Some people splurge their retirement pay on BMWs or Mercedes Benzes. But when they get really sick, they find themselves with not enough cash to pay the hospital. So save more, rather than spend more.

2. Assume some risk when investing. When you play safe in investing, you’ll get safe (but low) returns as well. Millionaires have gone out on a limb putting up businesses which they hoped would earn — nothing is guaranteed. But it is in taking calculated risks that they are rewarded.

When investing, look at higher-yielding investments. Sure, they may be more risky than regular ones (such as savings and time deposits), but you may earn more in the long run. Just be wary of get-rich-quick investment schemes. Remember the adage: If it is too good to be true, it is.

3. Live simply. If you keep your cost of living low, you will have more cash to save and invest. Some millionaires have lived in the same homes they have had for the past 30-40 years. Or they live in the homes they inherited.

You can also take a cue from the way millionaires live: not all party every night, nor do they buy every new car model that’s released. Instead, you’ll find these millionaires working at their desks at 8 a.m. and having just two cars in the garage.

4. Have a goal. Don’t just dream; set financial goals for yourself. By being specific, you will be more motivated to reach your goal. For instance, make it your goal to have your own home by the time you are 35 or 40. It may be a studio condo unit or a three-bedroom home in a subdivision—it will depend on your income and how you save over the years. Having a goal will help you focus your efforts well.

5. Choose good debt over bad debt. Take out a loan only when the loan proceeds will be used to earn you more money. For instance, apply for a bank loan to expand a business that’s feasible. But to take out a loan to buy assets that depreciate quickly (examples: sports cars, yachts, etc.) may not be wise as these assets will not earn you enough to pay off the loan. If you really want to buy such assets, pay in cash so you don’t have to pay the cost of borrowing.

6. Share your blessings. There seems to be a unique mathematical formula at work: The more you give, the more you are blessed back in return. Help those who are in financial need, and you may find yourself blessed all the more. If you’re an employer, share profits with your employees; they’ll be more motivated to work for you, leading the way to increased productivity.

7. Train children to handle money well. It would be sad if money you earned will just be spent unwisely by the next generation. Teach children the basics of money management, and caution them against vices such as gambling, drugs, and the like. Being responsible about wealth will be rewarded in the long run.

(INQUIRER.net and Citibank invite readers to ask questions regarding financial matters. Send your questions to personal_finance@inquirer.net or comment through our personal finance blog called MoneySmarts)

PS:
...don't forget: The ability to produce wealth comes from God (Deut. 8:18)

Received by email, thanks to my friend Ronald. A good read!

INTERVIEW OF WARREN BUFFET

There was a one hour interview on CNBC with Warren Buffet, the second richest man (now the richest man) who has donated $31 billion to charity. Here are some very interesting aspects of his life:

1. He bought his first share at age 11 and he now regrets that he started too late!

2. He bought a small farm at age 14 with savings from delivering newspapers.

3. He still lives in the same small 3-bedroom house in mid-town Omaha , that he bought after he got married 50 years ago. He says that he has everything he needs in that house. His house does not have a wall or a fence.

4. He drives his own car everywhere and does not have a driver or security people around him.

5. He never travels by private jet, although he owns the world's largest private jet company.

6. His company, Berkshire Hathaway, owns 63 companies. He writes only one letter each year to the CEOs of these companies, giving them goals for the year. He never holds meetings or calls them on a regular basis. He has given his CEO's only two rules. Rule number 1: do not lose any of your share holder's money. Rule number 2: Do not forget rule number 1.

7. He does not socialize with the high society crowd. His past time after he gets home is to make himself some pop corn and watch Television.

8. Bill Gates, the world's richest man met him for the first time only 5 years ago. Bill Gates did not think he had anything in common with Warren Buffet. So he had scheduled his meeting only for half hour. But when Gates met him, the meeting lasted for ten hours and Bill Gates became a devotee of Warren Buffet.

9. Warren Buffet does not carry a cell phone, nor has a computer on his desk.

His advice to young people: "Stay away from credit cards and invest in yourself and Remember:

A. Money doesn't create man but it is the man who created money.

B. Live your life as simple as you are.

C. Don't do what others say, just listen to them, but do what makes you feel good.

D. Don't go on brand name; just wear those things in which you feel comfortable.

E. Don't waste your money on unnecessary things; just spend on things that you really need.

F. After all it's your life, then why give others the chance to rule your life."

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MY QUESTION? Can you live with that? Add your suggestion/s...

How to buy a cheap car

By billvankoughnet
Source: eHow.com

Be realistic. You can find a great car for about $1000 if you can deal with a few facts about the cars available to you.
- most cars will be 10-15 years old; in rust belt areas, age is more important than any other factor. In sunbelt areas, old cars; ie. 60's,70's & 80's in good running shape are good bets, since they often are exempt from smog checks and are easier to repair.
-Choose mechanical integrity over appearance. In fact, many of the cars you can buy for this price may have dents or bad paint
-less desired models are better buys because good ones will often go cheap. For example, a Chevrolet Cavalier will be a better buy than a Honda Civic since the Cavalier has a lower resale value. You can find a nice Cavalier for about $1000, any Civic for that price will be thrashed.
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