Thought for today:

The term “time value of money” means that each payment applied to a loan’s principle amount (the amount before interest) will slightly reduce the remaining interest payment.  It shortens the life of the loan a bit more each time you pay an extra amount.

Paying off the highest interest rates first makes the most sense.  Making extra payments on the highest interest loan also makes sense.

The same principle works with investments.  After we have created a prudent reserve from our surplus, we can begin to invest money in a retirement or other interest-baring savings account.  As we make deposits, our investment can earn more interest.

A member shares:

“I am not planning on retiring for at least ten years.  I went to a family financial advisor whose funds had a good track record when compared to other funds.

“They advised me on the level of risk that was right for me. Since I have no need to get the money out any time soon, then I can ride market fluctuations.

“I look at my investments every day on an App on my phone.  The totals show up along side my loans, so I get a complete picture of how my finances are doing at  a glance.  Today I have more visibility on my investments than I ever did when I was younger.

“I never would have invested this way if it wasn’t for my Pressure Relief Meetings.  They set the stage so I could explain my financial situation to my Financial Advisor.  I even told this person that I was in DA, because it made it clearer where I was coming from, and where I had been.  They appreciated this fact, and kept my confidence.  I’m glad I was able to find people I could be honest about my finances with, who could help me along the way.”

A word about risk:

Many investments involve a risk of losing principle.   A trusted financial advisor (especially one who is a Charted Financial Analyst or CFA) is often worth the fees they charge.  A good professional will consider how soon you need the money, and base your investments on your particular time horizon – so the money is there when you need it.

We don’t invest blindly.  We go in with our eyes open.  We ask questions, knowing that if it doesn’t make sense to us, we need to ask more questions.

Ask:

Am I applying the snowball effect on my money?  Am I taking the right amount of risk for me?

Meditation for today:

We can learn a lot from a child’s play.  One makes a snowball and sends it rolling down a hill.  It starts small, and grows larger the further it rolls down.  This is the basis for the term “snowball effect”.

We learn how things work when we break them down into smallest elements.  Any complex problem is really many small, simple stepping-stones strung together.   Such is the story of DNA, and the stars.

A paycheck has in it dollars, rubles, yuan, euros.  We can divide these into as many separate envelopes as we need for our Spending Plan and Visions.

How should we parse our day?  Our time is also made of infinite possible divisions as well.  Each parcel of time is a gemstone moment – a kinetic but potentially transformational event.

When we combine the elements of money, time or energy (read “love”) in new ways, we can see their properties press into action, and we can admire the power and possibilities they represent.

Affirmation for today:

“I am a ‘possibility thinker’.”

“I will break down any problems into their smallest tasks.  I will then build solutions out of understanding.”

Check out these two inspiration books:

DailyOM: Inspirational Thoughts for a Happy, Healthy, and Fulfilling Day

Tough Times Never Last, But Tough People Do!

Click this book images for product information.

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