30-Day’s Cash

How much cash does a person need to survive a month of no income? While we cannot plan for every emergency, we can give ourselves a safety net that will give us a little peace of mind. If you were to lose your job for some reason, you would have at least one month to find work or retrain. Here are some things to take into account when planning your 30 day emergency fund.

Gas

What if gas prices are high? How far would a tank of gas get you? What if gas prices rose to twice what they are now?

Currency

What kind of currency will you need? Precious metals may ride out any fluctuations in the dollar value but what happens when it comes to paying? It is a good idea to have your cash in small bills and some coins. If you have nothing but hundred-dollar bills and there is no way to get change then you may be forced to pay a hundred dollars for something that only costs a few bucks.

Emergencies

What unexpected problems might eat up your cash, like car trouble, medical problems, or plumbing disasters? It is impossible to know whether it will be minor or devastating, but a few hundred bucks already set aside is a great blessing whatever happens. You will be glad you did.

Food

How much do you spend per month on food? Such a time would certainly demand that you cut down on outings and pizza nights. However, just because the future is bleak doesn’t mean you’ll have to boil leather either. You need good nourishment, especially in stressful situations. Save enough to be able to eat well and even have a few comfort foods.

Though this article is focused on money, I should mention that in addition to your financial reserve you need an actual storage of food. Stocking up now gives you the freedom to find foods on sale or wait for case lot sales. We cannot hope that food will be cheap when we need it most. The same goes for fuel and clothing.

Season

You never know what time of the year you may need to pull out the emergency fund. What difference is there in your expenses during the winter vs. summer? Imagine an exceptionally cold winter. The cost to heat your house could rise outside the planned budget, which could throw your whole budget out of proportion.

Education

What if you had to get some kind of training to be able to work again? A mechanic from fifty years ago would have a hard time finding work in these days of computerized cars and alternative fuels. Who knows what new of technological advances might render your marketable skills cheap or useless? Statistics show that the average person changes jobs seven times in their lifetime. The odds are not in our favor that our current employment will last us our lifetime. Things happen and times change. At the very least, you should expect to have to upgrade your skills. 

Security

Another issue to plan for is where you are going to keep all this cash. The logical place would be the bank. What happens if your bank shuts down for some reason? (Insert a few examples) The alternative would be keeping it in your home. Obviously, this presents some risk. A coffee can with thousands of dollars is enough to entice all kinds of scum. A safe box is a good investment if only to stash important documents. There is a variety of such boxes on the market. There is a box for whatever level of security you want, be it child-proof, waterproof, crush proof, fire-proof, or all the above.

After everything, though your first and greatest line of defense will be a zipper on your lip. This is not fool-proof though and should be backed up. If it becomes common knowledge that you keep cash stashed in your home you might be able to feed that rumor a red herring. Find a reliable blabbermouth and let slip that you moved it to a bank. On the other hand, you might make it so outrageous that it turns into myth. You could say that you have an underground vault with armed guards or that you spent it gambling.

Safe boxes are a good idea, but a burglar might just decide to take it with him and crack it elsewhere. A better idea is to get a floor safe or come up with a hidden place to stash your cash. It wouldn’t hurt to find a way to camouflage or hide your safe, like building it into the wall or some such ploy. The poor man’s version might be to stick with the traditional coffee can under the bed. Who does that these days anyway?

How do I start?

For even those with no one depending on him or her all this adds up to a pretty big price tag. However, for anyone who is working, it should not be very hard to set aside the necessary cash. It might take a while, but if you are living within your means then there should be a few bucks every month that you can put in a can. Keep the cash separated and labeled so that you know exactly what you have covered. Something I used to do is use envelopes and write on them what the money inside was for. That was before I upgraded to the underground vault.

It doesn’t make sense to put yourself into debt or take away from current expenses to reach your goal. There are a few ways to accomplish this. You might find financial drains that can be plugged or funneled into your 30-day savings. Some examples of such drains are as follows: household inefficiencies (wasting water, and other utilities), frequently eating out, toys (electronic gadgets, motorized recreation, etc.), home improvements, trips and vacations, TV, etc. Understand, I’m not saying that these things are bad, but when one’s spending is beyond one’s means there is a problem, and a little evaluation could fix it. You know what is essential and what really is not. It can be hard to change some spending habits, but imagine how you feel when there is too much month at the end of the money and you recall where your money went. When food gets scarce or the kids are sick, it gets hard to justify having a boat.

The first thing you should do after deciding to act is make a plan. Plan whether you will save by redirecting funds, finding part-time work, or both. There are many plans on the internet that help people painlessly amass a respectable sum over time. A secondary source of income might even become your primary source if things go awry at work. Use your own judgment to figure out how aggressively you will save and how soon you will reach your goal. Eventually this fund should be increased to six months and then a year but 30 days is a practical start, plus it will put you in the right mindset to continue saving.

Doubts

Everywhere I look I see the ideas and paradigms, from which I have tried to break away, being projected in front of my face, as though teachers were standing over me with a stick, pointing out the ways I am failing by not conforming to the norm, I feel pressured to put off, even abandon, this foolhardy crusade. Discouragement sets in as I apparently stand still while everyone around me continues to work normal jobs, provide adequate means for themselves, and move forward in life. Months have gone by and I haven’t earned a cent. I haven’t even settled on a decent plan of action. What would make my situation attractive to anyone? What have I to offer society? Am I really working towards something or have I just stepped out of the stream, letting everyone go on ahead? I have no proof that I am going in the right direction to reach what I would call success. As I listen to certain messages coming up all around me, I begin to feel like this pursuit isn’t quite as important as I had imagined. I can’t tell if this is just me losing focus on my original vision or whether I am beginning to see things in a clearer light. What does the word of the Lord say? Trust not in the arm of the flesh. The rich cannot enter the Kingdom of God… Do these scriptures say that to have riches is bad? Job had quite the fortune, and after all was said and done, ended up with several times what he had before. Lehi was a respected and wealthy man. King Solomon was at one point the richest man in the world. Abraham, Joseph, were these men poor in the eyes of men? No. These examples trump the deduction that those who have material wealth are evil and will be damned. Of course, neither is wealth necessary for salvation. The world is full of people who find joy in life even though poverty afflicts them every day of their life. Will money make me happy? Not in itself, or I would do anything for money. Can I buy happiness and success? No. Why then is money important to me? I don’t want to have to stress and worry about paying bills. I want to be able to be there for my spouse and children, to teach and help and play with them instead of existing solely to bring groceries. They might as well be on food stamps if that were all I was good for. I want to be able to make a difference in people’s lives. I feel like I cannot do that as an average Joe. Why do I feel like this is too easy and too hard at the same time? I had decided to not follow the 97%. I will not go out to get a job to support myself. It’s not that I can’t. I feel confidant that I could get a job most anywhere on minimum wage. There are places that take just about anyone, I am able-bodied and plenty qualified. I feel like I could even get a job without a resume, but so far I haven’t felt it necessary to attempt. I will work for someone to help them out. I guess the real test is whether I can work for others without monetary compensation.

3rd World Living (continued)

Recently I spoke to a man who grew up in a family where hundreds of thousands of dollars changed hands on a daily basis. Money was certainly not a problem for them. I mentioned my ideas to him about how the way we think and understand things affects our circumstances.

I asked if he had observed something different about the way his family thought and did things. He thought  for a minute and then said that he had. He said that most of his friends got an allowance each week. He asked them what an allowance was, they said that it was money that they got from their parents each week. He asked what they did to earn it. They said they didn’t have to, that it was what their parents owed to them. ??? He mentioned how his father would give him and his siblings money but always in return for work. This was nothing new to me, I had to work for every cent that I received.

He also said that his father talked about the role of risk and how there is no gain without risk. I found that interesting. I had no concept of risk in relation to money. Only recently have I begun to understand how value can be created through strategic use of risk. That is where I need to investigate more thoroughly in the near future.

The man is now a Real Estate salesman, making million dollar deals on a regularly. He found that he was good at and enjoyed sales when he was in high school selling subscriptions for school publications. So he worked at a few different firms and eventually started his own business. He is doing very well, from what I have observed.

It makes me wonder what other things people learn in their youth which leads them to make winning decisions throughout their life.

Responses to Third World Living

I wrote about a situation of living and invited a few people to consider how they would handle it. http://wp.me/p3ocfS-5K
These are some of the responses from people close to me:
Female, age 49:
Maintain furniture, save up for paint, toilet seat, grow garden, bring flowers into the house, find ways to make extra money, sell television, Save portions of food and money over time, scavenge for useful items to use around the house: shelving, flower pots, blocks, boards. collect books. Use whatever I could get my hands on to make things more comfortable. Use time otherwise spent watching TV to do something useful and productive.
Male, age 24:
I would move. I would take my family and do everything I could to either move to the country, or out of the country. My goal would be to homestead if I couldn’t get into America. But I wouldn’t stay in the city, or the country if I could help it. Heck, if they can homestead somewhere where it’s mostly winter, then I can homestead in Mexico.
 Female, age 27:
I would go to a paca and buy sheets or cloth to cover the furniture and maybe the walls. I would save up for a toilet seat, (however I have lived several weeks without one and it’s not so bad ;P). I’m not too worried about how to flush the toilet either. I would pipe water from the rotoplast on the roof to the bathroom and save up money for a heating shower head, obviously I have electricity because of the television, hot showers are nice, unless you are in somewhere hot. I might even sell the television, even though it would be hard (sniff). In a 3rd world country things are cheaper, so even though I would be earning only a dollar a day, I could still make ends meet, (if I ration my money properly, heh, heh!)
Female, age 18:
That sounds absolutely miserable, but at least you are entertained. Good grief, sounds actually pretty good for a third world country considering you actually have a house even if it is unfinished. Sounds dark and dreary and very tedious and unjust. I earn 7 dollars an hour and I don’t think I have enough to pay my own rent, given I have never tried or calculated how much a rent would cost or how much I would earn each month and how much of it would go to paying the rent. In short it doesn’t sound so good and I definitely would want to improve on my situation or get out of there. The camper is bad enough when it comes using a restroom you have to dump out, or rinse by hand. I could go on for ever about this but I have to go to bed so for now it would not be that great. Seriously, sell the TV and by a new toilet, though easier said then done, but seriously.
 Male, age 52:
Sell the television and work harder and smarter.  Call upon the Lord to inspire you to increase your ability to provide,  go to the mall and steal a toilet seat, and thank the Lord that you had a roof over your head, unfinished as it was.
Female, age 20:
First of all I would look for other ways for income, any way possible within reason. Then I would sell the TV and use the profit towards bills and food. Then I would continue with life, saving the extra income I got and would buy a library card so I would be entertained (by going to the library, not from the card alone). Continuing with life, I would continue to save and put the money towards what I needed, until I became a millionaire.
Female, age 19:
Honestly how does one get into such a state? First off, sell the TV  who needs that kind of garbage any way? Then get a better job. Or visa verse. Once you get enough money saved, or just enough money, get food, clothes and either a better house or start working on this one. Get a book on budgeting, plant a garden  be creative for crying out loud! Think of ways to save money, do things yourself. Who needs the government to take care of you? That’s how one  gets there in the first place. (sheesh.)
Male, age 19:
Well, the first thing I would do is pray for help and guidance to get me through. Usually my response to this kind of question would be something along the lines of, “Well, I would start by saving up 1,000 dollars in cash as an emergency fund, then building the nest, and slowly utilizing my resources and investments,” but in this situation there is a sense of hopelessness. I would study on how to work the system in Mexico, and then if all else failed do everything I could to make my way to the United States.
Male, age 21:
I would definitely change. I have seen it so I changed a bit but all priorities and sense of duty and fun would be altered forever. Every time you wake up after that your thoughts would be on making sure that all is well for the family you love so much. I would use what I know about being smart financially and make the best of it while always trying to improve my circumstances. One fear I would have is letting the situation bring out the worst in me, but that is why I would cling to the gospel.
My hypothesis is that since we have been conditioned/trained to live at a certain level of civility or social status we could take any situation in which we are placed and, through our ingenuity, reconstruct our accustomed life-style. I believe that we are not a victim of our circumstances but of our mind-set, or what we believe we need or can have/be/do.
Suppose a millionaire was placed in your shoes. Would he live like you do? Or would he make certain changes that would bring his situation back to what he is accustomed to, just as we would seek to better our situation placed in a third world country? It makes sense.
Why does someone from such a low living standard stay where he is? Why do we struggle so much to raise our standard of living? How can we condition our thoughts to think like a millionaire and hence become one?
This hypothesis is gaining credence in my mind as I learn more about life. I recently read a book called Rich Dad, Poor Dad where the author explains the different mindsets and lifestyles of two different men in his life. The one that happened to be his real father was a teacher and always sought benefits, higher salary through education, job security and so forth. He was also the poor one, always struggling to make ends meet. The other man was the father of a friend, who although not very educated according to contemporary standards became the owner of a small empire.
The book explains how people are driven by certain emotions that put them into a rut that eventually leads to what we call the rat race. These emotions are not necessarily evil but they do have negative effects on us. There is no question that base, carnal desires can turn a sophisticated society into hell. So how do we maintain the level of civility that we have? The same challenges and problems inherent in human beings were suffered by the heathen and the roman alike, the difference was how they dealt with those challenges. The British Empire was never free of sin and depravity, yet it thrived, I believe, because such depravity was discouraged, even though it existed it was not openly tolerated. They had a sense of propriety and civility. Unfortunately such propriety is not so prevalent today. But that’s another issue.
In Isaiah 55:8-9 it reads,”For my thoughts are not your thoughts, neither are your ways my ways, saith the Lord. For as the heavens are higher than the earth, so are my ways higher than your ways, and my thoughts than your thoughts.” This indicates that there is different understanding and intelligence, there are different motivations.
There are different levels of thought that are manifested in our actions and therefore our physical surroundings. A friend very simply stated that when you are unhappy with where you are, then you think about something better and you change it so that you can be happy.
Now ignorance doesn’t necessarily equal poverty or depravity. How is it that doctors can go broke or high-school dropouts can be heads of corporations?
In the book The Laptop Millionaire, Mark Anastazi says he saw his mentor (the Laptop Millionaire)  as though he was standing on top of all his books, looking over a wall at all the opportunities and saying “wow, making money is so easy!” While he stood below seeing nothing but the wall and wondering how he could possibly say that since he couldn’t see anything. In my mind that says the same thing as Isaiah when he says that the Lord is on a higher plane and can see things that we can’t and understands things that we can’t. The Lord also tells us that if we keep his commandments we shall prosper (1 Ne. 2:20; 2 Ne. 1:9; Jarom 1:9; Mosiah 1:7; Alma 37:13; 50:20) and “… seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you. (Matt 6:33) There are over thirty passages in the scriptures that talk about how abundant life can be achieved through obedience to God’s laws. It is not magic, but the natural result of trusting a higher intelligence. The beauty of it is that God is our father and he loves us. Sometimes I think we hear that phrase so much that we become callous to its meaning. It means that we are his greatest interest. We are not here by accident but for a purpose and that purpose is us.
Do our thoughts change our circumstances? Is there a connection between faith and prosperity? Is apathy dangerous? What holds a person in his life position? If you were placed in a lower standard of living would you stay there? What happens that makes a billionaire out of a homeless man? How can a millionaire go broke and then regain his fortune multiple times during his lifespan while the common man struggles to make retirement?

Third World Living

I like to read books that make me think. I always have a notebook or a scrap of paper handy so that I can capture any ideas that come to me. On one of these moments I thought about how someone from a middle class lifestyle would react if he were to be placed in a third world situation. I wrote out a situation with which I was familiar from my two years serving a mission in Mexico.

Here is the situation and what follows is a collection of responses.

Suppose there was a person who had a family of four, a job that earned minimum wages for a third-world country, a house of cinder-block with no finish and no paint, tile floor. The doors consist of blankets held up by nails, the bathroom is a toilet without a seat, a bucket of water is used to flush, and the shower is another bucket of water next to a bare cement floor with a drain. You do have television and a few amenities such as a stove and a refrigerator. Minimum wage is 60 pesos per day, which is about $1.00 per hour.
Knowing what you know now and having the experience and mind-set of your current self, what would you do if you suddenly woke up and found that this was your life? Would you change it? If so, what would you do?

Why 100,000?

I want a better car, one that gets better gas mileage and has four-wheel drive. I’d like a nicer apartment, eventually a nice house. Girlfriends can be expensive I hear, not to mention marriage and a family. I like my laptop but what if it crashes or gets stolen? How about some nicer clothes, my old ten-dollar hoody is getting a bit frayed and I’m embarrassed to where it in public. But it’s better than my last one, which I wore while working as a welder’s assistant, I get embarrassed wearing that even in private. A mobile device with WiFi would be nice.

These are some of the more frivolous reasons that I came up with. But these hardly generate enough drive to get me to do what it takes.

Favorite pastimes: I like to fish but a fishing license is pretty expensive. I would love to be able to buy some nice fishing equipment and maybe even go fishing in Alaska. I like to play the guitar. I’d like to get really good, but to do that I need practice and who has time to practice the guitar when there are bills to pay? Spare moments are spent learning useful skills, not dinking around with something that requires all your time to actually get good at it. I’d also really like to have a shop where I could build or create whatever I come up with. I would like to have the means and materials to dream up something and make it a reality. I might even be able to solve some problems.

I served a mission in Mexico, and met a lot of great people there. I made a lot of friends and became quite attached to them and their families. I’d love to visit in person rather than Facebook messaging and Skype. But such a trip also costs more money and time than I can justify spending.

Something else that I value is education. A couple of things which keep me from learning about some interesting subjects (aviation for example) is the cost of instruction and cost of time which in normal circumstances would be dedicated to work and living expenses. I also would like to be able to help others to afford the opportunities to educate themselves, including my children.

Hobbies would be nice to be able to spend time on but I imagine that even if I did find time and means enough to work on them I would probably use most of it developing the security and well-being of my family instead. I would like to reduce dependence on other organizations and sources as much as possible. Being financially independent is a huge factor.

Another point: can I be so selfish as to spend my life worrying about myself and my own interests? I had never thought about poverty as selfishness, but someone mentioned it in a blog and it makes sense to me. See http://wp.me/p3d0bn-8

I’m not sure how much money all this would add up to, maybe more, perhaps less than the 100,000 dollar mark. But if I can achieve this goal it would be very significant to me in itself. It would give me an idea of what I am capable of doing. It would prove to me the power of desire and dedication. I would have validated my ability to realize my own dreams. And having stretched myself to win such a sum I would not only have learned many valuable lessons about how to do it, but know that I could do it again.

So in summary, what are my leading motivations?

  1. Family
  2. Education
  3. Career
  4. Giving back
  5. Personal Validation

Time

Why don’t we apart time to do things that we want to do? time is a limited resource. We have many things that clamor for attention but our salary is always the same allotment each day. What we have to ask ourselves is what do I value? There is so little time that we cannot afford to spend one minute on things of lesser worth. We have so much to do. As with money, the bills should come first because they represent the preservation of our lives and those whom we love.

There is actually a lot of time that seems to slip through our fingers, at the end of the day we wonder where it all went. The fact is that we often spend it on things that have no real value to us, or we spend an excess of time on something. What we have to figure out is how much time each activity is worth, so that we don’t get ripped off for cheap stuff. Figure out what your values are exactly. Write down the things that are most valuable to you.

Good health is important to me, being relatively comfortable (warm home, bed, shower), my family is important to me so that merits a good chunk of time, my career is important to me.

What about my career is important to me?

ability to provide for my family

personal education and fulfillment

ability to contribute to society