Unemployment and Work

Unemployment and Work

By Keith Bunn Jr.

July 31, 2011

Unemployment

According to Google Public Data Explorer, unemployment in the U.S. in the month of May 2011 was at 9.1%. In my home state of Michigan it was at 10.3% for the same month. That doesn’t sound too bad. What!? How can you say that!?  Well, look at it this way. According to About.com, the U.S. population is about 310 million people. That means, just a little over 28 million people or 9.1% are unemployed. That would also mean that about 282 million or 90.9% of Americans are employed. The same goes for Michigan. According to Trueknowledge.com, the population of Michigan is just over 10 million people. That means, just over 1 million people or 10.3% are unemployed. This again also means that just over 9 million or 89.7% of the Michigan people are employed. If you took a test and got a 90.9% or 89.7% right, wouldn’t that be like an A and B? Wouldn’t you have taken an A or B in high school? I would have been ecstatic!!

Look, I don’t like that people are unemployed, but we’re never going to see 0% unemployment state or country wide. In fact, the lowest percentage we’ve seen was 2.6% in 1953 for the U.S. and 3.3% in 2000 for Michigan. The worst we’ve seen was in December 1982 for the U.S. at 10.8% and Michigan’s highest point was in July 2009 at 14% according to the Google Public Data Explorer.

On top of that, a resent study was just released stating that in 2009, entrepreneur activity rose to its highest rate in 14 years. Normally when someone starts their own business, they do it because they were laid off and can’t find work all the while they are considered unemployed and receiving an unemployment check. What I’m saying is, maybe our country’s 9.1% or Michigan’s 10.3% are not accurate numbers due to the fact that those entrepreneurs have not been counted as employed. So things are getting better. We have to start thinking about things from more than one point of view. If there is anything I’ve learned in the past few years is that there is always more than one way of looking at things.

Work

Most of the blogs I’ve posted to date are based on the outgo portion of our finances, but there is another side to it, the income side. The income side is just as important as the outgo side. Because lets face it, sometimes we just need to have a more money coming in. I mean, when your budget is down to the bare bones and you still can’t take care of the necessities of life (food, shelter, clothing, transportation and utilities), then its quite possible you either need a second, part time job or a better first job. Now, do I think that all our problems will be solved when we get a bigger income? Absolutely not! Personal finance is 80% behavior and 20% head knowledge. Too many times I’ve seen family and friends get more money coming in and all they do is increase their lifestyle. Additional income is only the answer if properly applied to your finances. Meaning, applying it in a way that you and your family benefits from it, like catching up your mortgage or rent so you’re not evicted or foreclosed on, paying down your debt so you reduce risk in your families’ financial world, etc…

Like I said, sometimes all we need to start changing our lives is some part time income. For some of you, an extra $1000 a month would absolutely change your lives, but I think sometimes egos get in the way of doing the right things to start winning with money and they won’t take a job like a cashier, deliver news papers or pizzas. I heard this story sometime ago where this big time white collar executive, who was in charge of training people in the company he was working for, found himself in a bunch of debt. Deciding that he needed to clean up his mess, he bit the bullet and got a job delivering pizzas at night. One of the most embarrassing times he had delivering pizzas was when he had to deliver a pizza to someone he was training at work. Don’t let pride get in your way of winning.

So what do we do if a part time job is not the answer? What kind of new job should we get that will pay more? Well, I would suggest that you look inward for that answer. Ask yourself, “what do I like to do?”, “how can I make money doing that?” I heard of a guy who liked to play golf. He went around garage and yard sales and bought used golf clubs. He would then clean them up and sell them on EBay and in one year he made $2 million just because he found out how to take something he liked and made money doing it.

But figuring out what you like and how to make money doing it is just part of the thought process. As Dan Miller, the author of the book 48 days to the Work You Love, suggests that the jobs we have should blend with our skills, abilities, personality traits, values, dreams and passions. If they don’t, then we’re going to be unhappy in our work no matter how much we make. To give you an example. The band Def Leppard  had a guitarist by the name of Steve Clark. After the band made it big in the 80’s with several number one hits, it was reported that on several occasions Steve would be found in the rest room before going out on stage for a concert, smacking his fingers on a sink trying to break them so he wouldn’t have to go out on stage to play. By the band’s 5^th album, Steve Clark died from an accidental mix of alcohol and prescription drugs in 1991. Someone who knew Steve said that he had never seen a more unhappy millionaire. That’s sad, but do you want to hear the exact opposite of that? Gene Simmons, a vocalist and bass guitarist for the band Kiss, was reported saying that in all his years of being in the band, he has never taken a vacation because he loves what he does. So what’s the message here?

Being unemployed sucks, but it’s not as bad as the news media is telling us. If you have lost your job or about to, cut your life style down and start figuring out what you want to do with your life. Maybe your job lose is a blessing in disguise. It maybe God pushing you in the direction you were meant to go and then get about doing that. When you find work that you love to do that blends your skills, abilities, personality traits, values, dreams and passions, it will no longer be work, instead it will be a vocation that has turned into a vacation. You will wake up every morning with all kinds of energy and not dreading having to go to work whether you are working for someone else or working for yourself.

This is an awesome quote from Calvin Coolidge that I’d like to share.

“Nothing in this world can take the place of persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent. The slogan ‘Press On’ has solved and always will solve the problems of the human race.”  

Get to the business of finding the work you love. It will not only benefit you and your family, but I’ll bet that others around you will benefit from it too.

 

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Readers are always Winners!

Readers are always Winners!

 By Keith Bunn Jr.

July 24, 2011

Now I have to admit, I am not the best reader in the world. I’m a pretty slow reader, but when I was told that one way to be successful was to find out what successful people are doing and copy them. So when I learned that the average millionaire reads a non-fiction book a month, I started reading! 

I set out and found what some people I trusted were reading and this is what I found out… 

For spiritual, I have read Max Lucado’s books Fearless and Outliving your Life. Fearless is basically how to deal with the fears that inflect us in our everyday lives. It is where I came up with the “Why are you afraid” blog. Outliving your Life, is about doing something in your life today that affects people in a positive way, that will last and remain ongoing long after you have passed. These are both great books and I recommend them to anyone. 

For financial, anyone who knows me more than a day knows that would be anything from Dave Ramsey. I have read Financial Peace and the Total Money Makeover. There is also More than Enough and How to have More than Enough, which I haven’t read yet but are on my list to read. In Financial Peace, Dave discusses about how he became a millionaire by the age of 26 and then lost it all in bankruptcy and foreclosures. After a long and hard climb back to the top again, Dave shares what he learned about money and debt. As he has put it, “God’s and grandma’s ways of handling money.” The Total Money Makeover, is a more “how to” book about handling money. It introduces you to the baby steps which is a step by step plan on how to get out of debt, stay out of debt, and build wealth. Both are excellent reads and I highly recommend them to everyone. 

For leadership, I recommend anything and everything of John Maxwell’s books. I have only read 2 short reads, How Successful People Think and Make Today Count. My wife Julie has a book of his called, The Complete 101 Collection, which is a collection of 6 of John’s books. Attitude 101, Relationships 101, Equipping 101, Leadership 101, Mentoring 101, and Success 101. I have not read this book yet, but it is on my list to read. In his books, John shares how he has learned to be an effective leader in his many years as head pastor in the many churches he has served in. I have found his knowledge to be very inspiring. 

For business, I have read The E Myths by Michael Gerber and 48 Days to the Work you Love and No More Mondays, both by Dan Miller. Gerber’s book is about why small business’ fail and what you can do about it if you have a small business that maybe in trouble. 

In 48 Days to the Work You Love, Dan explains that you don’t need to hang on to that job you dread going to day after day, week after week. That there is no such thing as a ‘secure’ job and that no matter who you are, you can find a job and land it that best fits your skills, abilities, personality traits, values, dreams and passions, no matter you age, sex, back ground, or education levels. No More Mondays, Dan again touches bases on the 48 Days concept, but this book is more on the entrepreneur side of things. Thinking outside the box, what kind of business could you start up that best fits your personality, passions, values, and abilities and make a ton of money doing it. 

If you want to become some kind of ‘Coach’, financial coach, life coach, career coach, etc… a good book to read would be Become a Coach by Justin Lukasavige. In his book, Justin shares with you all kinds of tips and tricks of the trade, so to speak, on how he went from a commercial airline pilot to a financial coach to now a business coach. Great tips from a great book. All of these books are a must read. Especially if you are thinking about or are starting a small business. Now here’s a heads up. On September 22nd, Dave Ramsey’s new book, EntreLeadership: 20 Years of Practical Business Wisdom from the Trenches will hit the store shelves. I have one pre-ordered to be shipped to my house on that date. I have been to Dave’s EntreLeadership one day event and it was awesome! In this book, Dave shares what he calls his ‘play book’ on how he started his business from a card table in his living room to a multi-million dollar company today. I can’t wait! 

Ok, I have just two more books to tell you about and then we’ll recap. The next book is Who Moved My Cheese? By Dr. Spencer Johnson. I know that’s a funny title for a book, and it even sounds like it could be a children’s book. Believe me, if you read it, it even reads like a children’s book, but I have to tell you, everyone who is reading this blog NEEDS to read this book! Because American, your ‘Cheese’ has been moved!! 

Last one. It’s called Guerrilla Marketing by Jay Levinson. Now I have to admit, I haven’t read this book yet, but it is sitting on my book shelf, waiting in turn to be read. It is about “Easy and inexpensive strategies for making big profits from your small business”. I have heard nothing but good things about this book and I can’t wait to read it. 

Now, Lets recap… 

For spiritual 

I recommend Fearless and Outliving your Life. Fearless by Max Lucado. 

For financial 

I recommend Financial Peace, the Total Money Makeover, More than Enough and How to have More than Enough by Dave Ramsey. 

For leadership 

I recommend How Successful People Think, Make Today Count, and The Complete 101 Collection by John Maxwell. 

For business 

I recommend The E Myths by Michael Gerber, 48 Days to the Work you Love and No More Mondays, both by Dan Miller, Become a Coach by Justin Lukasavige, Guerrilla Marketing by Jay Levinson, and in book stores September 22nd, EntreLeadership: 20 Years of Practical Business Wisdom from the Trenches by Dave Ramsey. 

For dealing with change 

I recommend Who Moved My Cheese? by Dr. Spencer Johnson. 

"The more that you read, the more things you will know. The more that you learn, the more places you'll go." - Dr. Suess – 

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In the Beginning

In the Beginning

By Keith Bunn Jr.

July 17, 2011

On May 1^st or 2^nd, I posted my first blog on here not knowing what I was doing or what to except. After that posting, I e-mailed a bunch of family and friends and asked their opinion on what I had posted and how the page looked. Out of a bunch of people e-mailed, I only got a few responses, which was fine. I thought about what they had said and made changes where I agreed with what they had said. Or not if I disagreed.

There is a friend of mine that I served with in the Army that answered my inquiry. Even though I have made some changes he suggested, there was one I had to really think about and ultimately decide not to do. He had made the suggestion of not talking about religion in these blogs. Not that he’s an atheist or something like that, he’s not. He just thought it might be a turn off to some future readers.

I totally respected and understood his suggestion. You see, it wasn’t too long ago I was the person he was talking about. Whenever someone started to talk about religion, I’d either leave the room or respectfully stay and just nod my head like a bobble head. Then in 2007, my wife Julie drug me to a Dave Ramsey, Financial Peace University (FPU) free preview. I really didn’t want to go thinking it was some sort of “get rich” scheme, but I went anyway. I had lost my job and we were really sucking with our money. Needless to say we went and signed up to take the class.

As we were going along into the 13 week class, Dave would say stuff like, “credit cards are a rip off and debit cards can do everything a credit card can do.” or, “people will only save money when it becomes important.” And he was right! I have always believed credit cards were terrible and the only time I had ever saved any money was when I did think it was important, like going on a trip or something. But, then he would back all that up with scripture saying, “The rich rules over the poor and the borrower is slave to the lender.” Proverbs 22:7 or, “In the house of the wise there are stores of choice food and oil, but a foolish man will devour all he has” Proverbs 21:20. Those scriptures hit me like a ton of bricks! They made perfect sense! And I thought to myself, if I thought those were true, what else was in the bible that I was missing, that were also true?

So, sometime later we joined the White Cloud United Methodist Church and we also joined a 30 week bible study. That was the first time I ever owned or opened the bible to read it. It was a very long class, but it was well worth it. Between FPU and our church, my life has completely changed and I see now that God has always been in my life. I was just too blind to see it.

So it was this part of my life that made me decide to leave the religion part in my blogs. There are over 800 scriptures in the bible that deal with money and Jesus talked more about money than he did love in the New Testament.

So if what I post on my blogs helps someone with their finances, great. If what I post on my blogs starts someone down on their spiritual path and help them to have a better relationship with God, even better!

“Next time you hear a baby laugh or see an ocean wave, take note. Pause and listen as his Majesty whispers ever so gently, ‘I'm here.’ ”

-        Max Lucado –

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Credit Cards, Car Loans, & Mortgages, Oh My! Part 3

Credit Cards, Car Loans, & Mortgages, Oh My! Part 3

By Keith Bunn Jr.

July 10, 2011

Mortgages…

Remember all the cable shows of all these companies and individuals buying and flipping houses? And almost as soon as the housing market crashed and burned, those shows disappeared. I have wondered a time or two, if those people or companies got out of that market with there shirts left on there backs.

There is no doubt that the housing market is hurting. When the interest rates dropped, my wife and I tried to refinance our home to get the better rates, but found out after the appraisal, that our home had lost $39,000. of it’s value. OUCH!! And at the time I’m writing this blog, all the news channels are talking about the housing values dropping even more. Let’s hope not!

What kind of mortgage should you get…

Pretty much the standard mortgage today is a 30 year mortgage with a good portion having an adjustable interest rate (A.R.M. or balloon) attached to it. Why a 30 year mortgage? No one really knows why, and it is pretty obvious why they attach an A.R.M. to it. If interest rates go up, so does the bank’s or mortgage company’s profits. But there is an alterative.

If you are out house hunting or you want to take advantage of these great low interest rates out there, try to get a 15 year, fixed rate mortgage that is 25% or less than your annual household income. The reason behind the 25% is if something were to happen, like a job loss, your spouse passes away, something that would have a negative effect on your household income, you would more than likely survive that event and not have to sell your home in the process. Mortgage companies and banks will tell you that you qualify for more than 25%, but remember this, they are looking out for their best interests, not yours. If something were to happen with your income and you get behind on your mortgage, they don’t care.

15 year vs. 30 year mortgage…

When it comes to 15 year vs. 30 year mortgages, the 15 year mortgage is ALWAYS a better deal. Let’s see why…

Let’s say you’re going to buy a home that will have a $225,000. mortgage on it that will have a 6% APR on it. Your payment on a 15 year mortgage will have a payment of $1,899. per month. The 30 year mortgage will have a monthly payment of $1,349. A difference of $550.

That’s a lot of money, but what does this picture look like 10 years from now…

The balance on the 15 year mortgage would be $98,210. The balance on the 30 year mortgage would be $188,292.! A difference of $90,082.!!! In 10 years, on that 30 year mortgage, you would have paid out almost $162,000. and only paid down the loan $36,708.! On top of that, you still have another 20 more years yet to pay on the 30 year mortgage and only 5 more years on the 15 year mortgage.

Keeping a Mortgage for a tax deduction…

To tell you the truth, I don’t do my own taxes. It just confuses the snot out of me. What can I claim, what can’t I. There is enough crap in the tax code to make you want to pull your hair out! But there is one thing I have learned, and that is you do not want to keep a mortgage on your home and use it as a tax deduction. Let me explain, because I know some of you have been told different.

Let’s say you have a mortgage of $200,000. with an interest rate of 5%. In one year, the interest you would have paid on the $200,000. mortgage is $10,000. $10,000 is your tax deduction, right? Now, if you paid off your home that would mean that you would have to pay taxes on an extra $10,000., right?

If you were at a 25% tax bracket, taxes on an extra $10,000. would be $2,500. So in a sense, what you’re saying when you say, “I want to keep my mortgage for the tax deduction.”  is, “I’d rather pay the bank $10,000. to keep from paying the IRS $2,500.”  If you want to have a $10,000. tax deduction, or whatever your deduction is, why not give that amount to your favorite charity or church? You have the exact same math except you don’t have to go into debt to do it.

What would you guess the average millionaire's home costs? $500k? $700k? $1 million? $1.5 million? It's $320k. That's how they became & stay millionaires!

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Credit Cards, Car Loans, & Mortgages, Oh My! Part 2

By Keith Bunn Jr.

July 3, 2011

Buying Cars with Cash…

Smart Money Magazine says, according to the National Auto Dealers Association, if a car dealer sells you a new car for cash, their average profit is $82. The No. 1 profit area at a dealer is the garage. No. 2 is the finance office.

Car Loans…

I kind of touched base on this subject in the Who wants to be a Millionaire blog, car payments are just stupid! A car loses 70% of its value in the first 4 years. It is the biggest thing that we buy that loses value like that. And if you’re a road warrior like me, you can forget about it, you warriors are absolutely destroying any value your car has by putting tons of miles on it.

 Statistics show that one-third of car buyers take out a $26,000-six-year loan at an average interest rate of 9.6%. That means that one-third of the cars on the road today have a $475 payment attached to them. Put simply, after six years, you would have paid about $33,000 for a $26,000 car, that’s now worth maybe $6,000. What part of this sounds smart to you?

Car Leases…

A car lease is basically renting a car. You pay “X” amount of dollars per month and at the end of the lease, you turn it back in. If you want to buy it, you are buying it for the market value they estimated it to be at the beginning of the lease.

If you pay $400 a month for 60 months, you have paid $24,000 at the end of the lease, before turning it in, it’s called the residual value. The car will not go down in value any more than that, because the car companies would lose money. You will have paid them more than the car has depreciated during that time when they get the car back. Now, if you rented the car for $24,000 and its value only went down $15,000 out of the $24,000, then the car company has made a profit of $9,000. On top of that, the Federal Trade Commission does not consider car leases debt so the interest rates on a vehicle leases are not disclosed because there is no federal disclosure involved.  So you have no truth in lending disclosure sheet. Now if you knew how much you were being charged in interest you would then know how much you were being ripped off.

“The worse car accidents happen on the showroom floor.”

- Dave Ramsey -

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