Many Americans aren’t going to end up with money to retire on. These days, it’s a sad fact. Instead of complaining about that reality (and the injustice of it all) the best action someone who wants to retire can do is simply make sure they aren’t the average American. They need to take steps to make sure they will have the income to enjoy their retirement and be able to pay their bills, including their ever-increasing medical-bills.
The most effective way to avoid being one of these Americans who wind up working at some remedial job through their retirement, based on the opinion of Robert Kiyosoki, author of the “Rich Dad Poor Dad†book series, is to invest in real estate.
Buying investment property is an excellent way for people to prepare for our retirement because it supplies a great benefit called “passive incomeâ€. After someone has done the preliminary work, passive income keeps coming in without a lot of effort. A typical worker gets paid only for the time he puts in.
A real estate investor, after developing her system, makes money for keeping it running. And keeping it running, if she been very clever about it, will involve paying his employees to do the job of checking up on them every now and then.
A best thing about passive income (such as from investment properties) is, the more time the investor keeps them, the more ROI they should make for him/her, with less and less effort on the investor’s part. It’s the nearest thing to magic we will ever find in the world of finances.
It sounds attractive, but one should never simply take the plunge without looking first. Although it is all very learnable, there’s quite a bit to learn when you are thinking about real estate investing – things like comprehending economics and the laws related to real estate.
The most important concept to understand, however, is one’s own personal limitations. The person who knows where to locate the information she wants is much better off than the person who remembers tons of facts and formulas around in his/her memory.
In the book “Cash Flow Quadrant,†Robert Kiyosaki teaches newbie investors to raise their income as well as their knowledge. Mr. Kiyosaki writes of creating a business system that will set up and left alone, freeing up the owner to move on to the next deal instead of spending all his/her time babysitting his/her business. The next step is to continue that real estate education and start to look around for specialists to employ and property to acquire.
Robert Kiyosaki also refers to this change as moving from one part of the cash-flow-quadrant to the next. He emphasizes that, the 1st step someone needs to take toward transforming his or her life is changing the thinking process. If a person changes the way he thinks about money, then he will wind up in a much better position to change his relationship with it.
The way people think determines the actions they take throughout the day, and those actions determine the level of their success. The main value of studying books like Robert Kiyosaki’s “Rich Dad, Poor Dad†series – brings you closer to a new paradigm about things. When investors see how easily it is to establish new skills and acquire better knowledge, they are virtually impossible to stop.
Alex Anderson Uses The Minnesota MLS To Help Her Clients To Find Minneapolis homes for sale. Download A Free Copy Of “The Investors’ Rental Guide†At GreatInvestmentProperty.com.
~ By Lindley Press ~~
Are those “golden years” approaching, and if so, have you thought about your financial retirement plans?
Robert Kiyosaki, world-famous author and financial advisor, said before you retire, if you want sell your home and move to greener pastures, you have to balance your books first.
“Retirees are on fixed incomes , let’s say it’s $1,000 a month, last year in 2007. The value of a dollar dropped 15 percent last year and it was even more this year,” said Kiyosaki.
“So that means that your $1,000 a month last year is now only worth $850 and this year it may go down to $600 a month.”
According to Kiyosaki, if you follow a few simple rules, you will really be protecting yourself for the long haul.
“It really becomes important to be able to differentiate good financial advice from bad financial advice. Do you know what’s going to work for you and not work for you?” said Kiyosaki.
“I think the biggest mistake is “Well, I’ve been with the same financial planner for 20 years,” and I say, ËœWell are you rich?” and they say Ëœno.” Well, maybe you should change.”
Consumer Reports recently found out what their retired readers wished they had done differently, so yet-to-be-retired readers could avoid similar mistakes. While 93 percent of their readers were satisfied with how they had prepared themselves, those who had some regrets said they wished they had saved more.
Getting ready for retirement
Are those “golden years” approaching, and if so, have you thought about your financial retirement plans?
“Never count on your pension being enough, even a federal pension or a government pension,” said one retiree.
Those with many years until retirement said they know this has to be a priority. Many others said they wished they had started saving younger, and that’s the advice they would give to others.
“The more financial education you have, the better you’ll be able to tell is this advice good for me or bad for me. Does this advisor know what they’re talking about or not know what they’re talking about,” said Kiyosaki.
Read more from the original source:
Financial retirement plans: figured out sooner is better
~ By Jason Zweig
(Money Magazine) — Slow and steady wins the race, but a bird in the hand is worth two in the bush. Those dueling proverbs sum up the investing mind.
When you imagine choosing between making a quick buck or growing rich later, you know the right answer: Be patient and hold out for the bigger gain. But as soon as you face a real rather than an imaginary choice, the fast money seems irresistible.
New discoveries in neuroscience labs are helping to explain why it’s so hard to resist the allure of instant gratification. It turns out that your brain is much more aroused by $1 today than by $1 tomorrow. And $1 six months from now barely registers.
Only the promise of a much bigger reward later can fire up your brain the way an immediate score does. No wonder it’s hard to save instead of spend and, when you do save, to think long term; the average holding period for a stock, among individual and professional investors alike, is just over 11 months.
And the temptation to buy dotcom stocks in 1999, energy stocks in 2005, real estate in 2006, emerging markets in 2007 or gold right now — what’s hot when it’s hot — is overpowering for many people, no matter how often they’ve been burned before.
A sip now or a slurp later?
Recent experiments conducted independently by three teams of researchers at leading universities have focused on the battle in the brain between now and later.
Tracking people’s choices and their brain activity, one group tested whether college kids would rather have a sip of fruit juice soon or a slurp later. They also tracked how folks decided between Amazon.com gift certificates redeemable the same day for a small amount and those redeemable up to four weeks later for a larger amount.
A second team offered people the choice between $20 immediately and an array of alternatives ranging from $20.25 six hours later to $110 six months later. And a third group measured how individuals responded to the choice between various dollar amounts today and an extra 5 percent to 30 percent up to six months later.
“When our emotions are charged, we have a hard time waiting for a reward,” says Carnegie Mellon University’s George Loewenstein, one of the first study’s authors. Even the chance of getting a slightly bigger reward tomorrow doesn’t have the same stimulating effect on your brain as a gain today does.
It’s all downhill from there. A gain the day after tomorrow carries even less of an emotional kick, and so on. In fact, to the typical person, $20 now is better than $23 three weeks from now, $40 three months from now or $47 six months from now, according to the second study, led by a pair of New York University researchers.
In short, for your brain to be willing to wait a mere three weeks for a higher payout, that $20 would have to grow at an annualized rate of roughly 4,800 percent.
Rational? Hardly. But evolutionwise, the response makes sense. In our hunter-gatherer days we often faced scarcity. And when we’re really hungry, a future feast has to be huge to justify choosing it over eating now.
So are we moderns doomed to save and invest like cavemen? Not necessarily. Knowing that you operate in what NYU’s Paul Glimcher calls “as soon as possible” mode is the first step to making better financial decisions. Willpower and good intentions, though, aren’t enough. You need help. Here’s what to do:
Lock in for later. Saving now is harder than planning to save later. So commit yourself to doing the right thing a year from today. Want to raise your 401(k) contribution? Use calendar software to mark the distant date when you’ll take action — and send an e-mail to a small group of friends now and on that day reminding them that you have committed.
Don’t take your lumps. When you change jobs, it’s tempting to take the money in your old 401(k) as a lump sum instead of rolling it into a new plan or an IRA, especially if you’re decades from retirement. So whenever you’re starting a job hunt, pledge in writing to a friend that you will roll over the retirement account.
Likewise, if you are older and are fortunate enough to have built up a sizable pension benefit, pledge that instead of taking a lump sum when you’re eligible, you will string your pension out over many years as an annuity. Have that commitment witnessed by friends or family members who are younger than you are so they will likely be around when you put away the work shoes.
Similarly, when you’re investing your savings, you need to resist the temptation to simply go for whatever looks as if it will provide a quick return. Take these steps:
Answer two big questions. Why — other than a rising stock price — should I invest in this business? Do I have any reason to think that I know more about this company than whoever sells me the stock?
Sleep on it. If putting money into a hot mutual fund is really a good idea, it’ll still be one tomorrow. Waiting until the next morning won’t cost you much profit, but letting your brain’s anticipation circuitry cool down overnight could save you from an ill-timed bet. And you’ll be richer for your patience.
The rest is here:
Can?t save? Blame your brain
