Welcome to Financial Spiderplant! I’m here to track my progress towards financial success and the pursuit of the freedom wealth provides. I’ll start it off with a statement that is a little out there because that’s my style.
Finance is easy.
The concepts behind various financial instruments can be hard to understand but all of the underlying ideas can be reduced to simple concepts.
I’m not kidding. There is so much information out there that you can learn to do anything but without forming your own ideas and your own understanding based off of input you collect, you will not be able to easily identify opportunites that present themselves.
You become a better football player by analyzing specific weaknesses in the oppositions defense and offensive playstyle. Most of us now drive with a specific set of instincts that we developed based on our own experiences. You can’t learn how to drive without driving. You can’t learn how to swim without learning how to spash. You will not learn finance unless you practice finance.
I’m here to encourage anyone who wants to learn more about finance. I’ll happily send you personalized responses to your questions because I want to be aware of the obstacles that people often face when dealing with finance. While I might not always know the answer, I’ll pursue that answer until I do because…I’m good at it and I enjoy it.
Write me at david113@gmail.com.
Why Spiderplant?
If you plant a spiderplant, once it has grown to a point where it is large enough to survive, it begins to bud with new spiderplants. These smaller versions of the initial spiderplant can grow large enough that you can cut them from the first plant and pot them. Then, the seedlings grow, produce more seedlings and the process continues. It is all about the growth of the initial plant.
If you don’t plant the initial seedling, it won’t grow; it won’t survive; it won’t prosper and produce more seedlings. If you don’t plant the first seedling, you’ll never have more spiderplants.
Finance is like a spiderplant. You can make an investment (planting the seedling) and as the investment (plant) grows via additional contributions/dividends/capital gains, it grows to a point where it is a solid investment. (surviving plant) As growth continues, your initial investment can yield capital for more investments .(seedlings) The new investments ‘grow’ via additional contributions/dividends/capital gains/contributions from your already prosperous initial investment. Growth continues, more investments are created and before you know it, you have enough spiderplants, er…investments, to start giving them away to friends/family/charity. You can allocate specific investments (seedlings) to cover your rent, car payments, charitable contributions, or travel and vacation.
It isn’t difficult once you make the first investment. If you don’t make the first investment, you’ll never see growth and you’ll never have multiple investments which contribute towards you having a better life; which can contribute towards many individuals having a better life.
Your first investment might be an investment to cover your emergency expenses should you face emergency car repairs or unemployment. Your investment vehicle might be anything from a savings account to the purchase of a specific stock which you could sell should an emergency arise.
OR
Your first investment might be one to help your children’s education via a 529 College Saving Plan. If your child was 6 years old and you started contributing just $500/yr into an investment account that yielded 10%, you would have over $13,000 to pay for their college education when they were 18 years old. Bump that up to $1,500 and you are talking about over $40,000 to help out with those college tuition costs.
OR
You might want to focus on your own retirement and start contributing to a 401K/TSP plan that your employer offers or increase your current contribution rate. You could even use the all-powerful ROTH IRA to assure that you are more than taken care of. Just an example, I’m 25 and if the ROTH contribution limit stayed at $4,000 and I made a full contribution from now until I’m 50 (the latest I plan on retiring), I’d have made contributions of $100,000 ($4000/yr over 25 years) and would have an account valued at $665,336 if I managed a 12% return. That’s enough of an account balance to produce over $30,000 in income and that’s if I left it in 100% bonds and CDs. (For the record, ROTH contribution limits ARE going up and the above calculations make no allocation for additional investments in any other accounts)
Investing isn’t difficult. Finance isn’t difficult. The underlying rules behind all financial vehicles are the same. Plant, allow growth, and use gains to either foster more growth or simply spend it. I guess my real question is, if you have no investments, do you plan on starting an investment/planting that first seedling? Are you willing to even toss a couple of seeds (money) you have lying around in spare change jars or the leftover money you have in your wallet after going out?
Come on, lets take a little responsibility for the position we are in! We have so many opportunities, there is so much out there. If you are happy with where you are, congrats! If you want to learn a little, stick around. If you want a better life, stick around! I’m just starting my real planting and I’m tracking all of the moves I’m making, maybe you can at least learn something from the mistakes I’m bound to make! I HATE making mistakes but I LOVE what I learn from them. Let’s get started!
You are welcome to send me an e-mail at david113@gmail.com and I would be happy to answer any questions you have and post the answers on the website.
