A full-time income on part-time hours revisited part one: An exciting business opportunity for you!

“Remember to keep an open mind and get some new information!”

Two key focuses of my blog are Financial Literacy/Money and Business/Entrepreneurship. I originally published this series back in November of 2013 when I wrote for the Examiner. Of the businesses that the average working-class person can get involved in, none are more controversial than “Multi-Level Network Marketing” businesses (MLMs). I bought into a MLM when I first started my federal career which was a learning experience. It sounded like a good idea at the time but didn’t go quite as planned. This series talks about what I both experienced and learned during that little experiment.

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This next series of articles will veer off the path of scholastic education and literacy, and venture into the world of financial literacy. This series will look at Multi-Level Network Marketing businesses (MLMs). It’s an subject area rarely explored in print, but one which we’ve all experienced through personal participation, being recruited or being sold a product or service by someone else.

These business models and the people involved with them are already highly scrutinized, thus the intent of this series is not to do more of the same. The goal will be to simply take an objective look at them from multiple perspectives: the business associate, their prospects, friends, relatives and coworkers. As a writer, my goal will be to be fair in my commentary.

This topic will potentially touch multiple people. It’s particularly relevant in this era of recessions, further potential government shutdowns and sequestrations where people are being forced to consider alternative ways of earning income. Again, the goal here is not to sway anyone to a particular side, but simply to educate readers curious enough to read this series.

“Hey man, I want to talk to you. I’ve been watching you. You look like a serious brother, and I have a business opportunity to turn you onto,” a bus driver told me at the beginning of my commute one morning. “I don’t want to drive this bus forever, and I want to make some real money! Take this brochure and if you text me your number, I’ll invite to one of our meetings so you can get some more information!”

I could hear some contempt in his voice, particularly about having to work his job which was interesting. It raised a couple of questions in my mind. Why would someone feel contempt about working their job? Why would someone feel contempt about working a job? Why would someone feel resentful about having a paycheck? Many would say that there’s dignity in working. We’ll revisit this later in one of the subsequent parts of this series.

Besides being surprised that one of the metro bus drivers ‘prospected’ me for recruitment into his business, it brought back memories of my own experiment with Multi-Level Network Marketing. Just briefly, Multi-level Marketing is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of the other salespeople they recruit.

What made this bus driver prospect me? And what made him consider me a “serious brother?” It could’ve been my regular ridership on his route most mornings. Perhaps it was my “serious” appearance and disposition that made me seem like someone who could effectively work in his business and help he and his colleagues achieve their financial and life dreams.

My thoughts reflected to the many network marketers encountered during my travels in person and on social media, and what their motivations were. My motivations at one time for participating in one were: becoming rich, taking advantage of business tax breaks, and being able to walk away from my job.

Since 2005, multiple opportunities have come across my path. The first was from an Indian man in his late 20s in a supermarket late one night just before I moved away from Michigan. After striking up a friendly conversation with me about my life and aspirations, he started talking about an ecommerce business he was involved in. He encouraged me to learn more about it and to, “keep an open mind and get some information,” common phrases used by prospectors. Have you ever experienced anything like this?

Since then there have been numerous offers to participate in businesses involved in ecommerce, financial counseling, travel services, weight loss/health products, legal advice, organic coffee, and health care services. The list goes on. You name it, and someone has gotten it covered.

At their informational meetings, most if not all the network marketing businesses had elaborate presentations, and marketed dreams of:

• Financial independence;
• Making multiple residual passive income streams;
• Walking away from 9-5 jobs;
• Taking vacations whenever desired;
• Making your own schedule and;
• Making a full-time income on part-time hours.

This topic will be examined in greater detail in the subsequent articles. People’s motivation for joining this type of enterprise will be examined in part two of this series.

Thank you for reading this blog post. If you enjoyed this piece, you might also enjoy:

Are you getting your Matching Contribution? A discussion on saving for retirement
A look at the Law of Compounding Interest and why you should care
Your Net Worth, your Gross Salary, and what they mean
Is there power in budgeting your money
I still don’t have a car in 2018: A story about playing financial chess
We should’ve bought Facebook and Bitcoin stock: An investing story

If you’ve found value here and think it would benefit others, please share it and or leave comments. To receive all the most up to date content from the Big Words Blog Site, subscribe using the box in the right-hand column in this post and throughout the site, or add the link to my RSS feed to your feedreader. Please visit my YouTube channel entitled, Big Discussions76. Lastly follow me on Twitter at @BWArePowerful, on the Big Words Blog Site Facebook page, and on Instagram at @anwaryusef76. While my main areas of focus are Education, STEM, and Financial Literacy, there other blogs/sites I endorse which found on that particular page of my site.

What are you getting for that? Learning to write and unlocking one of Robert Kiyosaki’s riddles

“When you are young, work to learn, not to earn!”

The first principle of my blog is Creating Ecosystems of Success. The idea for this piece came to me at least six months ago. As a writer, sometimes you have ideas that roll around in your head for a while asking to be put on paper. Sometimes the timing isn’t right and then one day, that time comes. This blog post will bring together multiple topics: entrepreneurship, writing and life skills. In fact, I plan to gradually create a series just on writing and blogging, and I hope you enjoy this piece. The images used throughout this piece are from one of the business cards I had made up for myself, when I was a writer for the Examiner.

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“What are you getting for that?” Someone I dated several years ago asked me this question with a bit of snark and petulance in her voice. I suspect it was because she felt that she was competing with my writing activities which had become my passion. I was writing for the online publication, the Examiner, in addition to a host of other activities I was involved in. The Examiner had several rules for its writers, and one of the biggest rules was that contributors had to publish something at least once a month. So, during that time I was always literally ‘on the clock’. Once two weeks lapsed without publishing something, they’d send an automated email reminding you of their policy and its consequences.

“What are you getting for that?” I did receive ‘something’ from the Examiner as I pumped out article after article for them. The publication paid it’s writers on a commission, though it was admittedly only ‘peanuts’. It was by no means enough to pay the mortgage, and it was enough to only get a lunch from time to time. My significant other at the time was tickled when I told her what I typically got for the effort I was putting in.

The dollar amount I received didn’t necessarily bother me though, as deep in my heart I knew that I was after something else at that time. I was after something that couldn’t be easily spent up or paraded around. The most valuable compensation I received from the Examiner wasn’t the money, it was the experience!

“Have you ever thought about taking a writing class?” The impetus for writing for the Examiner was the dream of a book I wanted to write. On a visit back to Buffalo, I showed my mother, a trained writer herself, a sample of what I’d written. I watched nervously as she quietly read it on the couch. She softly responded with the above-mentioned question which was as they say, “letting me down easy.” The message clear though. I may have had some great story ideas, but I needed to learn how to write.

She was right, but I had to go forward with my dream somehow. Thanks to my friend George, I’d read the Passion Test and knew that I had to give it a legitimate try. But where was I going to learn how to write quality content consistently?

Two things happened at the same time right around 2014. I found The Writer’s Center in Bethesda, MD and took a couple of writing classes there. One was a personal short essay class, and the second was a beginner’s Science Fiction class. I also took a workshop about publishing.

“In order to become a writer, you have to read a lot and you have to write a lot!” As noted in the story of my blog, Dr. Gerald Early gave me this advice back in 1995 when he presented one of his books at the SUNY College at Brockport. He recommended that I could start writing for the school newspaper. I didn’t take his advice back then, but I remembered his advice 20 years later when a woman named Kelley recommended that I apply to write for the Examiner. By chance we met at a STEM fair at Bowie State University.

I subsequently applied to be an “Examiner” and they accepted me. I specifically applied to be an “Education Examiner” as everyone had to specialize in an area. What ensued was a writing adventure that lasted for two to three years. Education was a vast umbrella and I could make almost anything fit under it. I was particularly interested in: education, science, money and life stories about my path as a minority scientist and others.

In addition to their time stipulation, the Examiner had other guidelines. They didn’t want a ‘blogging’ format, so the use of “I” was limited and highly policed. They wanted large paragraphs to be broken up into smaller ones, and they wanted the pieces to be as short and concise as possible. They also gave us the Associated Press’s guidelines to follow for properly abbreviating states, for reporting dates and times, and even for what and what not to capitalize in the titles of our pieces. Lastly, we were to add hyperlinks to our pieces, but only legitimate sources. “Wikipedia” wasn’t considered a legitimate source.

Being on the board of directors of the Friends Arlington’s David M. Brown Planetarium, I had a guaranteed supply of stories nine months out of the year, and the board enjoyed the free coverage. In addition to any education or life-related pieces I wanted to write, there were always current events in the news that were worth discussing. The racial controversy in the NFL’s Seattle Seahawks’ locker room comes to mind. The blackness of quarterback Russell Wilson was questioned by some of his teammates which set off a firestorm.

The retired and controversial professional basketball player, Charles Barkley, openly talked about the black community’s, “dirty dark secret”, regarding education and, “talking white”, which further fanned the controversy. With my own experiences, I wrote a piece backing up Barkley which temporarily vaulted me into the number one ranked education writer, as it was so racially charged.

When you logged into your online ‘dashboard’, the Examiner ranked its top five or 10 writers in your area. The number one spot was usually held by a woman who I’ll call “Nancy G”. Nancy must’ve written for the Examiner fulltime and didn’t have a ‘nine to five’, because she was always pumping out content.

It was amazing. Some of the black commenters were so worked up over my supporting Barkley’s position, that they confronted me in the comment section of the article which surprised me. It was very educational as I learned about how people can be racially ‘triggered’, even by members of their own race over things that are true. I’ll probably revisit this in the future.

I eventually learned that the internet is like a vast ocean where people are looking and fishing for different things. As a writer, unless you see your number of subscribers rise, or you see your social media likes/shares spike, you don’t know who is looking at your pieces. That said people are out there watching you, even when you don’t know it.

In January of 2015, I was contacted and offered the opportunity to interview actor Hill Harper regarding his collaboration with the National Honor Society (NHS) on its “Honor Your Future Now” campaign. Afterwards I also got to interview the President of the NHS, Dr. Jonathan Mathis. It was a lot of fun and something I never thought that I would do. It was the first of many interviews that I’d do when writing for them.

“You should work to learn, as opposed to learning to work!” This quote from Robert Kiyosaki’s anonymous “Rich Dad” is one of the many riddles found within the Rich Dad Poor Dad series. In his books, Robert’s core messages are about wealth creation and financial independence. He discusses how individuals who are interested in becoming ‘investors’ and ‘business owners’ should be willing to first seek out the knowledge they need to create their wealth, even if it means working with someone or on projects, for little or nothing simply to acquire the knowledge, experience and expertise which can be leveraged later.

This was in part what I was doing as I wrote for the Examiner. I was acquiring the experience as I had other bigger projects in mind further down the road. Up to that point though, I hadn’t had any experience writing my own pieces, and publishing them. One of the biggest rules the Examiner warned us about up front, was that of ‘quality control’. That is every piece we published had to be polished and ‘squeaky clean’ in terms of grammar.

In 2013 I gained a “Press Credential” at the “Congressional Black Caucus Annual Legislative Conference”. I had published pieces for the Examiner for at least two years and earned the right to directly publish my pieces and bypass their editors. I was hoping to get ‘news worthiness’ for the piece which meant that it had to go up within 48 hours of the conclusion of the event.

Either by doing too many things at once, or just becoming complacent, I tried to publish an overview of the conference which was riddled with errors. One of the main errors was a misspelling of then President Barrack Obama’s name. The Examiner staff flagged it and reprimanded me. I was so embarrassed as I read their editorial comments.

It was my second or third piece which was below standard and my right to publish without the editor’s approval was revoked. I should’ve known better, but before the Examiner eventually closed its doors, I got the privilege back, though I had to earn it. The lesson was clear; don’t attempt to publish poor quality work – a lesson I’ve brought with me here to my own blog.

What I got from writing for the Examiner making ‘peanuts’ was the experience – something money can’t buy. The hours of writing, creating content, and my mother editing my pieces were all to set up some other writing projects I’d always dreamed of writing, and to be able to start my own blog. Back to Robert Kiyosaki’s riddle, depending upon what you’re doing, and what you want to do, acquiring the experience is the critical piece which sets you up to make the money later. It’s one of the reasons he and others stress being “life-long learners”.

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In the process of writing and earning those peanuts from the Examiner, I gained the experience, confidence and I developed my own writing process which includes:

• The initial conception of the idea;
• Creating the first draft of the idea;
• Revising the piece two-three times, and approving of it myself before sending it for final editing by someone else and;
• Making any revisions after final editing as some last-minute ideas sometimes trickle in.

Much of this is not new by the way. I do liken it though to what Berry Gordy learned from working in the automobile industry. He learned the process of creating quality cars and then he translated that knowledge into creating quality records. So, in summary, while earning peanuts while writing for the Examiner, I learned:

• To write quality content (my own ideas and actual events);
• To use visuals with the pieces (with attribution when necessary);
• To add quality hyperlinks to my pieces;
• To write using the Associated Press’s guidelines when applicable;
• To identify specific ‘tag’ words (used five times) in my pieces so that the piece will more readily show up in any Google searches and finally;
• To add the links to my other work at the end of pieces to allow readers to see what else I’ve written in that area or others.

I incorporate all these elements here on my blog. So, yes, sometimes to perfect your craft, or to learn from an expert/mentor, you may need to do it for free or next to nothing. As Stephen Covey stated in The Seven Habits of Highly Effective People, “Highly effective people start off with the end in mind!” Furthermore, as Stephen King said in On Writing, if it’s something you love doing, no one will have to force you to do it, and you will likely do it for little or nothing, at least initially anyway.

In closing, thanks to the advent of Search Engine Optimization (SEO), my blog-platform has begun generating more than just peanuts and I’ll just leave it at that. Again, this will be the first of many pieces I’ll generate on blogging and writing. Stay tuned for more. I want to thank the Examiner for letting me contribute to their website.

I want to acknowledge my mother’s eldest sister, my Auntie Melva for introducing the money-term ‘peanuts’ into my vocabulary as a kid. I first heard her use it in one of her many spirited discussions one day with her siblings. That might’ve been my first time in life comprehending that words in the English language can have multiple meanings.

I finally want to thank my mother for helping me along on this adventure. She’s edited most of my stuff. Also, many of the seeds for this were planted several years ago in elementary school when she insisted that my brother and me learn proper typing technique. Neither of us understood why we were doing it at the time.

Thank you for taking the time to read this blog post. The following articles that I wrote for the Examiner which have been updated, revised and republished here on the Big Words Blog Site:

The benefits and challenges of using articulate speech
Challenging misconceptions and stereotypes in academic achievement
Hill Harper discusses Honor Your Future Now campaign
Dr. Jonathan Mathis discusses Honor Your Future Now campaign
A Black History Month look at West Indian Archie: A story of wasted scientific potential

If you’ve found value here and think it would benefit others, please share it and or leave a comment. To receive all the most up to date content from the Big Words Blog Site, subscribe using the subscription box in the right-hand column in this post and throughout the site. Please visit my YouTube channel entitled, Big Discussions76. You can follow me on the Big Words Blog Site Facebook page, and Twitter at @BWArePowerful. Lastly, you can follow me on Instagram at @anwaryusef76. While my main areas of focus are Education, STEM and Financial Literacy, there are other blogs/sites I endorse which can be found on that particular page of my site.

Important considerations when buying a condominium unit revisited part two

This is a continuation of my series entitled, Important considerations when buying a condominium unit. Part one ended with a discussion of the nuances and caveats of buying into condominium communities. This second part will talk about what can happen when condominium owners must finance common projects within their complex in emergency situations.

To start this discussion, I want to introduce a key financial term, the “Residential Assessment”. Residential assessments are basically lump sums of money every owner must pay which is typically the condominium fee. In some instances, based upon the community’s by laws and constitution, a residential assessment can also be mandated from every owner should a project need to be done affecting the entire complex under ‘emergency’ circumstances.

This was painfully revealed to me when the first of many assessments in my condominium community was due in the Fall of 2010, just after purchasing my unit. Clues that something was up were there before closing though. When visiting my prospective unit for the first time, and when going through the inspection process, a large project was underway requiring the excavation of the land around the foundation of my soon to be dwelling. As a first-time home buyer, it didn’t occur to me to press the seller about what was happening – ultimately a good thing for her.

The question did come up though. She simply said, “Oh it’s just some foundational work.” She didn’t say however that the entire building was sliding and shifting on its clay foundation, and that the entire project would result in an $8,500 assessment for me, my entire Obama Tax Credit. Needless to say, having to cough up $8,500 unexpectedly was a bitter feeling.

Truthfully, the information about this project may have been in the “Condo Docs” or condominium documents. They were a binder of documents (at least 300 pages) provided prior closing. Another piece of advice; take the time to flip through any information given to you about your property prior to purchasing it, especially if it’s in condominium community. In the real estate world, this is part of what’s called doing your ‘due diligence’. Why didn’t I take the time to read the documents? I’ll chalk it up to ignorance and being a novice to the home buying process.

In any case, having the $8,500 Obama tax Credit was a blessing as it saved me from having to take out a loan. In addition to the $8,500 assessment, there was a $1,600 assessment preceding it due to delinquent condominium fees from other owners throughout the complex. This all occurred just after the bursting of the 2008 housing bubble and the subsequent recession, so there were quite a few folks in the community who either lost their jobs, ran out of money, didn’t have enough money on hand, or both. Either way, the rest of us owners had to pick up the slack.

Since those first two assessments, there was another $8,500 assessment to help replace the old underground piping of our complex which seemed to break every winter like clockwork. The board of directors created a payment plan so that the payments could be spread out over three years. The installments would be paid with interest, while those who could make the payment at all once, would be charged no interest. Years later there was yet another $8,500 assessment to cover updates to our HVAC system. If this all sounds like a lot of money, it was.

So, what are the takeaway messages from this? Aside from the points Dave Ramsey made in part one of the series, they are as follows:

• No matter what type of real estate you decide to buy (a detached home, a townhouse or a condominium unit), budget so that you’re as debt-free as possible and so that you have extra money on hand (Dave Ramsey’s Emergency Fund of 3-6 months of expenses for example);
• When you buy into a condominium community, every owner’s destiny and finances are intermingled;
• Before you buy and piece of real estate, ask as many questions as you can of the seller, especially the obvious ones and;
• This last bullet comes from one of Suze Orman’s books. Before you buy into a condominium community, go as far as to hunt down the board of directors and ask questions. Try to figure the history of the community, its overall financial health and any additional issues it may be facing going forward.

Part three will conclude this series and discuss a key part of a condominium community; its board of directors, and the ongoing challenges my community is facing. Thank you for taking the time out to read this blog post. You might also enjoy:

Are you getting your Matching Contribution? A discussion on saving for retirement
A look at the Law of Compounding Interest and why you should care
Your Net Worth, your Gross Salary, and what they mean
Is the power in budgeting your money?
I still don’t have a car in 2018: A story about playing financial chess
We should’ve bought Facebook and Bitcoin stock: An investing story

If you’ve found value here and think it would benefit others, please share it and or leave comments. To receive all the most up to date content from the Big Words Blog Site, subscribe using the box in the right-hand column in this post and throughout the site, or add the link to my RSS feed to your feedreader. Please visit my YouTube channel entitled, Big Discussions76. Lastly follow me on Twitter at @BWArePowerful, on the Big Words Blog Site Facebook page, and on Instagram at @anwaryusef76. While my main areas of focus are Education, STEM, and Financial Literacy, there other blogs/sites I endorse which found on that particular page of my site.

Important considerations when buying a Condominium Unit revisited part one

I’m republishing my series regarding considerations for buying condominium units. I originally published it in March of 2015 on the Examiner. I’d lived in my condominium community for six years, and within that time there were quite a few surprises which I wanted to warn first-time home buyers about.

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Some of my earlier pieces discussed my experiences with Dave Ramsey’s Financial Peace University (FPU). Recently at the Alfred Street Baptist Church our class went over module number nine which dealt with real estate and mortgages. In the module, Ramsey and one of his teachers, Chris Hogan discussed several dos and don’ts regarding mortgages and purchasing homes. Some of their key points were:

• Don’t rush into owning if you’re not ready as it can have long-term ramifications if not properly prepared for;
• Make sure you have enough money saved up for the down payment and for maintenance;
• Make sure the mortgage payment doesn’t exceed 25% of your monthly income and;
• Don’t agree to adjustable rate mortgages, interest only mortgages, or 3% or less down mortgages.

Watching the video was humbling for me as my own path to ownership involved some of the very things they said not to do, such as agreeing to a 3% down mortgage – something I did out of ignorance. Just briefly, agreeing to something like a 3% down mortgage is bad because the buyer is ‘over-leveraging’, and it usually creates two loans to payback. This will be discussed in greater detail in a separate piece.

My first home purchase was a condominium unit. It was purchased in 2009, just as the damage and after effects of the Great Recession started settling. It was also just in time to benefit from the $8,500 “Obama Tax Credit”. My unit was particularly close to Washington, DC’s metro system (WMATA) which appealed to me since my car was on its last leg. Being so close to the metro, the unit fell in line with the “Location, Location, Location” rule about real estate.

After getting approved for the financing, and closing on the unit, it seemed to be victory. I jumped from being a renter to an owner and good times seemed to be on the horizon. While the purchase of my condominium unit seemed to be a ‘slam dunk’, and all my years of schooling seemed to be paying off, a great deal of heartache and hardship were on the way.

Neither of my parents were familiar with condominium units. They both owned duplexes in Upstate New York (~2000 square feet total for each house) with front and back yards, and garages. Both their homes were ironically valued less than my condominium unit (~950 square feet). Both of their homes had two separate units under one mortgage, something you can’t find in the Washington, DC area, probably due to local laws and ordinances.

Just briefly a condominium is a building or complex of buildings containing several individually owned apartments units. When you buy a condominium unit, you’re not just buying your unit, you’re also buying into a community with a “Homeowner’s Association”, a “Board of Directors”, and more importantly, common financial interests, costs and destinies. The board is charged with maintaining the complex and taking care of repairs to common areas (walls out), while the unit owners are responsible for the maintenance of their own units (walls in).

This short series on condominium units will discuss:

• Why it’s important to ask the right questions when purchasing a condominium unit;
• As a unit owner, why it’s important to plan to keep extra money parked one’s savings and on hand for emergencies;
• What happens when condominium associations don’t plan for routine maintenance and how that catches up with unit owners in the long run and;
• What happens when the board of directors and unit owners are split on issues concerning their condominium community.

As will be described in part two of this article, there are unique issues to buying into condominium communities. Specifically, the importance of doing one’s due diligence and what condominium communities do when money needs to be raised within the community for emergencies and special projects will be discussed.

Thank you for taking the time out to read this blog post. You might also enjoy:

Are you getting your Matching Contribution? A discussion on saving for retirement
A look at the Law of Compounding Interest and why you should care
Your Net Worth, your Gross Salary, and what they mean
Is there power in budgeting your money?
I still don’t have a car in 2018: A story about playing financial chess
We should’ve bought Facebook and Bitcoin stock: An investing story

If you’ve found value here and think it would benefit others, please share it and or leave comments. To receive all of the most up to date content from the Big Words Blog Site, subscribe using the box in the right-hand column in this post and throughout the site, or add the link to my RSS feed to your feedreader. Please visit my YouTube channel entitled, Big Discussions76. Lastly follow me on Twitter at @BWArePowerful, on the Big Words Blog Site Facebook page, and on Instagram at @anwaryusef76. While my main areas of focus are Education, STEM, and Financial Literacy, there other blogs/sites I endorse which found on that particular page of my site.

Mother’s Day 2019: Thankful for my upbringing

The original version of this piece looked much different then this published version. After much consideration, I cut it down. I realized that as a storyteller/writer sometimes less is more and more is less.

With a million and one things on my plate right now, I wondered if I’d have time to craft something for Mother’s Day 2019. After creating pieces in 2017 and 2018, I’ve decided to continue the ritual. If you’re a man and thinking about marrying someone and paying for it yourself, you should read my 2017 piece. It may save your life and sanity. The 2018 piece is a tribute to my maternal and paternal grandmothers. In this 2019 piece, I’m going to reflect on the home my mother created for me and my brother early in our lives.

In the process of discussing my upbringing and some of the tools I had to develop after leaving my home ecosystem, I may have sounded unappreciative of my parents which was an unintended effect. Regardless of how ungrateful I may have sounded of my upbringing as a child, I’m actually VERY thankful for it. As I got older, went away to college and started dating, I slowly realized that everyone’s home wasn’t like mine. I can discuss numerous examples, but I’m just highlight a few.

I’d say that Mom masterfully walked the line between “grace and legality” as Dave Ramsey said in one of his Financial Peace University modules. She established discipline and a behavioral standard that lasted all the way through adulthood for both my brother and me. I picked up on this early in the company of my best friend, who either didn’t have as tight a ‘leash’ on him at home, or he just rebelled against it. I hope reflecting on this doesn’t get me in trouble with him. In a way I admired his rebelling at the time, but it had consequences.

Mom always made sure we were well fed and that we ate together. The first time I realized that all homes weren’t like ours was when we spent the night over one of her close friends’ home who also had boys around our age. After a night of playing around and doing what boys do, I woke up the next morning expecting our typical ‘royal’ Saturday morning breakfast. At our house, breakfasts usually consisted of homemade pancakes or waffles, a meat, and scrambled eggs. Instead we had only had cereal that morning. It was better than nothing, but it was different than our home.

Yes, the pancakes were homemade and they were good. Sometimes we had French Toast instead. On Sundays before church we had donuts from “Tops Friendly Markets” instead of the pancakes. Mom also made those breakfasts for us on Wednesdays before we went to school and before she went to work. We had cereal the other four days, hot cereal during the long Buffalo winters.

“You all had privileges growing up that I didn’t have.” A cousin told me this at a family gathering within the last year. I’m going to keep returning to this revelation because in my community, there’s a fixation on ’white privilege’, but there are in fact ‘privileges’ that black families have over other black families, many of which are driven by the personal choices of the parents.

The cousin who told me this is black, and I agree with her assessment. Yes, my mother was college educated and hers wasn’t, but let’s strip it down even further. As kids, this particular cousin annoyed the hell out of me in terms of her behavior, and she always wanted to come over to our house and stay a while. It wasn’t until I got older that I understood the depth of her situation, and that her coming over was good for her.

I’ll just say that our house was safe and there was a lot of love there from my mother and grandmother. There was no cursing (except when my Uncle Poo-Dee came to town), violence, no abuse of any kind, and there were no illegal drugs being used or sold. In general, there was a certain level of peace normalcy there. Without going into detail, my cousin’s house was the exact opposite of ours which is why she always wanted to come spend time with us.

The point I’m trying to make is that my mother made conscious choices to create a safe and love-filled home environment for us. Had I been born to a different mother, my nurturing at home could’ve easily been very, very different. Check out my YouTube video on the concepts ‘Nature vs. Nurture’ if you don’t understand the interplay between these two concepts and how they impact who we become later in life.

I could expound further on some of these things, but I’m going to shift the discussion to the concepts of love and positive affirmation. How important is it for parents to tell their children that they love them? How important is it for parents to tell their children that they’re proud of them? They’re very important. Some kids never hear these two essential words from their parents.

They’re critical as hearing them impacts our socialization and also the adults we go on to become. As I transitioned into adulthood, I discovered that not every one of my peers received positive affirmation at home, and in most instances, it impacted their abilities to give it to others. In my home, we heard these words all the time.

Why would the parents not give their kids positive affirmation? Well maybe those parents didn’t get it themselves. Maybe those parents received it, didn’t appreciate it and didn’t pass it on. In some instances, maybe they endured some life circumstance that beat it out of them so they couldn’t pass it on. As we get older, we do start to see that our parents are people themselves with their own experiences, flaws, shortcomings and vulnerabilities. They have their own scars and have made their own mistakes.

In terms of our upbringing and home, yes, I think both my brother and me did win the ‘lottery’ of sorts in terms of growing where we grew up and growing how we grew up. My Aunt Adele told me several times when I got old enough to understand things that my brother and myself were ‘sheltered’. When she came to town to visit us, she was frequently amused by how my mother seemed to ‘baby’ us in the mornings as we headed off to school.

As a pre-teen and a teen, yes, I did intuitively see that the other kids knew about more mature things than we did early on. Many of them were more ‘street smart’ and there were pieces socially that needed filling when I left our house to go to college. The lack of some of this ‘Consequential Knowledge’ definitely manifested in the dating arena, and that’s all I’ll say. According the great Dr. Thomas Sowell, Consequential Knowledge is knowledge for which there are consequences if you don’t have it.

As a man being raised mostly by a single mother, many of these gaps have taken years to fill, and for some it’s an ongoing process. A part of my personal message now is that single mothers can’t do everything. Many have their hands full just paying the bills and keeping food on the table. They might not be able to come to every basketball game for example. They might support you playing and may make sure you’re nourished enough to go to school and to participate in your sport of interest, but to succeed at the craft, you’ll likely have to find the expertise you need elsewhere, and you might not find it at all. I’m working on a book project on that right now.

“Of my eight children, your mother is my most loving child Anwar.” My grandmother told me this frequently when we talked, and it might be the thing I remember her saying the most. Not taking anything away from my two aunts and five uncles, but I think myself and my brother did win the lottery in this case because we grew up with a lot – not necessarily all the material items that my best friend and other peers had, but a lot of things you can’t buy with money. And those are the most valuable things in life.

I’m more careful these days about discussing the tools I did and didn’t get in my home ecosystem. If I do venture into those waters, I’m sure to do it with an understanding mind as it’s never to demonize anyone. For ourselves and for our community at large, some discussions with my contemporaries and peers need to be had, and interestingly many of us black ‘Generation X-ers’ have common experiences.

We’ve realized that there was some consequential knowledge that we somehow arrived at adulthood without knowing. Wealth-building and relationships are examples, and we’ve still had to line up with everyone else and run life’s ‘marathon’. Our parents, like all parents, could only teach us what they knew, and it’s up to us to make up as much ground as we can in the race using the tools we have.

I’m going to close by saying that I’m thankful and grateful for everything my mother did for us. Everyone’s home is not the same. At the end of day, it’s about being grateful and content about what you do have. What are you grateful for that your mother did for you? Happy Mother’s Day 2019.

Thank you for taking the time out to read this blog post. If you enjoyed this post, you might also enjoy:

Father’s Day 2018: Dad’s doctor and his lawyer and discussion on careers
Two well-behaved boys left to figure things out on their own: reflections on growing up ‘Blue Pill’
Father’s Day 2017: reflections on some of Dad’s money and life lessons
Mother’s Day 2018: Memories of my grandmothers
Mother’s Day 2017: one of my mother’s greatest gifts, getting engaged, and avoiding my own personal fiscal cliff

If you’ve found value here and think it would benefit others, please share it and or leave a comment. To receive all the most up to date content from the Big Words Blog Site, subscribe using the subscription box in the right-hand column in this post and throughout the site. Please visit my YouTube channel entitled, Big Discussions76. Lastly follow me on Twitter at @BWArePowerful, on Instagram at @anwaryusef76, and at the Big Words Blog Site Facebook page. While my main areas of focus are Education, STEM and Financial Literacy, there are other blogs/sites I endorse which can be found on that particular page of my site.

Are you getting your Matching Contribution? A discussion on saving for retirement

“If you’re not contributing up to the five percent match, you’re leaving money on the table!”

Note. Like my Net Worth piece, the subject matter of this blog post is not new. It has been known for years by those who’ve learned about it in their families, learned about its concepts in business school, or have discovered it on their own. It’s a discussion from my personal perspective which I think is worth visiting. Also, while this is a ‘money’ topic, I’m discussing it from a ‘scholarly’ perspective. I’m not rendering financial advice where I’m telling readers what they should do. In the spirit of the first principle of my blog, Creating Ecosystems of Success, I’m simply introducing a concept and discussing why it’s important for the lay person, so they can make their own life choices.

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At the beginning of this week, a mentor emailed me telling me that April is “Financial Literacy Month”. He asked me if I was writing anything on this subject. I shared with him that I already had something coming out of the pipeline regarding a topic we’d coincidentally discussed at length. He also shared an article with me entitled, There is a savings crisis and many Americans don’t know how to fix it. Here’s how. It serves as the perfect jumping off point for my financial offering for the month of April 2019.

I saw many retirement commercials during my young adult life. They were usually run during sporting events. I wasn’t thinking about my older years at the time, which seemed too far away to imagine. The commercials I remember the most are those by Dean Witter where, in the black and white film, he states, “We measure success one investor at a time!”

My next thoughts of saving for retirement came courtesy of Robert T. Kiyosaki, author of Rich Dad Poor Dad. I believe it was in his book, Conspiracy of the Rich. In the book he described the “Employee Retirement Income Security Act” (ERISA) enacted by President Richard Nixon. The new law made employees responsible for their own retirement savings, converting most everyone over from ‘Defined Benefit’ (DB) plans (pensions), to ‘Defined Contribution’ (DC) plans. That was during my postdoctoral fellowship and I think I set up a ‘Roth IRA’ at my bank, shortly after reading the book.

It wasn’t until I started working in the federal government that I seriously started thinking about retirement, but it wasn’t due to my own volition. It was due to a friend I was dating at the time. I’ll facetiously say that the relationship didn’t last, but her asking me about whether I started saving in my government “Thrift Savings Plan” (TSP) was a major contribution on her part. She caused me to think about retirement in the relationship context.

I realized that I might be a liability as a partner if I didn’t have my own retirement ‘nest egg’ which in some respects is true. (See my Mother’s Day 2017 blog post to get a feel for the potential dangers of two people settling down when only one has savings and the other one doesn’t.) In terms of relationships, are money and resources everything? No, but they count for a lot and are worth pondering and discussing ahead of time!

At this point I’m going to transition and point out that in the financial world, there are different rules for different people. I first learned this after reading the above-mentioned Robert Kiyosaki’s second book, Cash Flow Quadrant, which discussed the differences between: Employees, Self-Employed Individuals, Business Owners, and finally, Investors. To make a long story short, in addition to having their own unique ‘tax laws’, employees by nature have a ‘working life’, and they must figure out how they’re going to survive once their working life is over. That’s if they’ve thought about it.

Some of my relatives are beneficiaries of the DB plans described above, but they’re “Baby Boomers”. My father is a retired educator who started teaching in the late 1980s. My uncle, a retired firefighter, started his career around that time as well. I could be wrong, but I think that most municipal workers such as the police officers and firefighters receive Defined Benefit pensions. Most teachers now must contribute to a Defined Contribution plan. If I’m wrong, please leave a comment below. What if you’re responsible for your own retirement savings? Read on.

“If you’re not saving the maximum amount so that you’re getting the government’s five percent ‘Matching Contribution’, you’re leaving money on the table!” The first person to point this out to me was a counselor at work who was helping me with relationship issues with the above-mentioned lady friend. By the way, this anonymous friend inspired me to write my piece entitled, The difference between being Cheap and Frugal, so she deserves a lot of credit in terms of inspiring some of my content.

I’d told the counselor that she’d called me ‘cheap’ on multiple occasions, a label which hurt me at the time. One of his immediate questions was about whether I was saving into my retirement account to get my government match. When I told him that I was saving less than the five percent, he responded that I wasn’t taking full advantage of what the government was offering me. Also getting the match should’ve been first and foremost in my mind.

So, what is a Matching Contribution and why is it important? I’m glad you asked. A Matching Contribution is a dollar amount that your employer matches in relation to what you’re saving in your retirement account. For the federal government, it’s five percent, and it differs from employer to employer. Some don’t match at all. The point is that if you’re not contributing anything, you’re not going to get anything, or maybe the bare minimum. If your employer matches what you’re put in, you’re effectively getting free money.

Your employer match makes it easier to get to the holy annual retirement threshold of 15% and beyond. If you’re consistently saving five percent, and your employer is matching that with their five percent, you’re already at ten percent for the year. At that point you must come up with another five percent or more to get to 15%. If you don’t know where you’ll get that extra five percent, look at your personal budget. I wrote a piece on that recently.

If your employer doesn’t match your contribution, should you still save for your retirement? Absolutely. First, if you’re going to work until your 60 years old or more, you do want something for yourself, or else you’ll have to keep working, or someone will have to take care of you.

Second, from experience, your retirement savings contributes to your ‘Net Worth’ and this translates into other areas such as qualifying for mortgages. Most lenders want to see that you can save money and something they consider qualifying you for a mortgage is your Net Worth – the difference between your assets and liabilities. I wrote a piece on that as well.

When refinancing my mortgage two years ago, I realized that that my lender actually had a form entitled, ‘Net Worth’. Calculating it quarterly was routine for me by then. I’d already built up an ‘Emergency Fund’ and I’d started methodically saving into my retirement account, so I knew I was in good shape. This was in stark contrast to when I barely qualified for my first mortgage due to being too ‘overleveraged’ (carrying too much debt) ten years earlier. See my post on Dave Ramsey’s ‘Debt Snowball’, to see how I dug out of my own debt-hole.

Speaking of debt, as an employee living off one paycheck, budgeting, controlling costs, and minimizing debt are all keys to being able to build a retirement nest egg. You want to be able to create enough ‘Cash Flow’ so that you don’t miss the amount going into your retirement account every pay period. Furthermore, you don’t want to be in position to have to raid or borrow against your retirement savings should an emergency arise – both of which could hurt you.

Speaking of Dave Ramsey’s group, a good book to read is Retire Inspired by Chris Hogan. It gives a nice discussion about what retirement is and why it’s important, which brings me to my closing point. If we all know we’re going to age, why doesn’t everyone save for their retirement? I think the answer is a lack of awareness and a lack of understanding of why it’s important.

“You should’ve learned about this when you were 18 years old!” My mentor scowled at me after we finished talking about my retirement savings and why I hadn’t maximized it a couple of years ago. It stung for a moment, but I laughed about it inside afterwards. It would’ve been nice to have been educated on the subject 20 years earlier, but honestly those in my ecosystem back in Buffalo just weren’t talking about investments or retirement savings.

One could argue that the change from DB-pension plans and DC plans needs to be better explained in the school system so that all kids get exposure to these concepts early. I do agree with that, but the reality is that if these things aren’t discussed in your family circle, you must figure them out on your own somehow.

I don’t want to make this racial, but over the years I’ve heard stories of Jewish families regularly and openly talking about money and investments at family gatherings. It’s not race-specific as my mentor’s family which is black, regularly engages in these types of discussions. What does your family talk about at gatherings?

The financial world has a language all its own. When you’re entering your first job fresh out of school, being told to start your retirement benefits and then hearing all the esoteric terms can literally sound like ‘gibberish’. It can be daunting like talking to your surgeon or your auto mechanic. Unless you understand why it’s important to start saving for your later years, you’ll likely neglect it and use your precious resources on other things, but hopefully not for too long, as it’s difficult to catch up beyond a certain age.

Why is it hard to catch up? This brings us to the “Law of Compounding Interest” of which time is a major component. I wrote a piece on that as well which I’m sure you’d enjoy, but the quick version is that the earlier you start your retirement savings, the more time they have to grow and multiply. Furthermore, depending on the nature of your plan, you could be missing out on significant annual tax savings which add up over the years.

The last important piece is figuring out what your retirement savings should be ‘allocated’ in. This is a completely different but related subject. The point is though, that you must have something to allocate first and foremost.

Thank you for taking the time to read this post. If you enjoyed it, you might also enjoy:

A look at the Law of Compounding Interest and why you should care
Your Net Worth, your Gross Salary, and what they mean
The power in budgeting your money
I still don’t have a car in 2018: A story about playing financial chess
We should’ve bought Facebook and Bitcoin stock: An investing story
My personal experience with Dave Ramsey’s Debt Snowball revisited

If you’ve found value here and think it would benefit others, please share it and or leave a comment. To receive all of the most up to date content from the Big Words Blog Site, subscribe using the subscription box in the right-hand column in this post and throughout the site, or by adding the link to my RSS feed to your feedreader. Please visit my YouTube channel entitled, Big Discussions76. Lastly follow me on Twitter at @BWArePowerful, on Instagram at @anwaryusef76, and at the Big Words Blog Site Facebook page. While my main areas of focus are Education, STEM and Financial Literacy, there are other blogs/sites I endorse which can be found on that particular page of my site.

Jordan and Mr. Troy: A mentoring story

I originally published this piece on the Examiner back in August of 2015. From 2010 to 2014, I mentored in a program called Higher Achievement which was a very educational experience. I made lots of friends there. One was a fellow mentor named Troy. Our ‘scholars’ were encouraged to address us formally. After I finished volunteering in the program, Troy passed suddenly. To honor him, I wrote this piece about him and one of his problematic scholars who at the end of it all, appreciated Troy’s efforts.

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My last article outlined tips for adults looking to mentor young people. This article will reflect on a former peer and one of his mentees.

Mr. Troy was a fellow mentor in Higher Achievement, where our middle school-aged scholars (mentees) were encouraged to refer to us adult mentors formally as Mr., Mrs. or Ms. (fill in your first name). My title was Mr. Anwar. Though we had met a year or two prior, it wasn’t until the end of my fourth year in the program that we became friends. Not having a car, Troy generously gave me rides to the metro after mentoring and on a couple of instances we had drinks afterwards. He was from Detroit and with me being a University of Michigan alumnus, we were both familiar with Southeastern Michigan. Our discussions covered numerous topics, but many of them involved his scholar we’ll refer to as Jordan in this article.

Of Mr. Troy’s scholars, Jordan kept him the busiest. Jordan was a pale complexioned kid with curly brown hair. He was very energetic and pretty much did whatever he wanted to do even when instructed otherwise, similar to his identical twin Jason who was slightly taller and older. Both brothers regularly challenged authority and deviated from the night’s activity. After being told, “No,” by one adult mentor, it wasn’t uncommon for them to run to another one who wasn’t privy to what was going on to get what they wanted. There were several nights when we’d look on as they would run around the center wreaking havoc and getting into things they shouldn’t have been.

Mr. Troy, a father of two grown young adults himself, speculated that Jordan was the middle child and as such, felt the need to seek attention, sometimes in the most destructive and disruptive ways. Interestingly even though Jordan had tested his patience on numerous nights, Mr. Troy still found a space within himself to understand the kid.

Mr. Troy even decided to have some fun with the situation. One night he bet Jordan that if he could go a certain number of nights without being disruptive, he would shave his head. Mr. Troy wasn’t worried though because he felt that Jordan had little chance of controlling himself enough to win the bet. He was predictable in that way and Mr. Troy was right. Then, at the night of the graduation ceremony, Jordan said something that none of us expected.

“I want to thank Mr. Troy for everything he’s done for me, and for being my mentor over the last four years,” Jordan said in front all of the mentors, scholars and parents. We were shocked. We looked at each other and chuckled a little bit in a restrained way. The one scholar who seemed to want to follow directions the least, ultimately appreciated all of the effort that had been put into him over the previous four years. We reflected on it over drinks again at the end of that night.

Mr. Troy’s mentoring of Jordan showed that sometimes you’re making a difference in a young person’s life even when it doesn’t feel like you are. This extends well beyond Higher Achievement’s mentors and scholars. Back at Hutch-Tech High School in Buffalo, NY, a teacher once told me that several former students returned and thanked him for being hard on them because they found that the adult world could be an unforgiving and demanding place, and that all workplaces (the public and private sectors, and the military) were in need of mature and responsible individuals with internal structure and discipline.

That night of Jordan’s revelation was my last time seeing and speaking with Mr. Troy. We lost him around this time last year. We were all surprised to hear of his passing, and Jordan probably was too. He was the recipient of one of Mr. Troy’s last great gifts; a conscientious adult willing to mentor him, discipline him and provide structure for him.

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Thank you for taking the time to read this blog post. If you enjoyed this one, you might also enjoy:

The benefits and challenges of using articulate speech
Challenging stereotypes and misconceptions in academic achievement
Challenging misconceptions and stereotypes in class, household income, wealth and privilege
Lasting lessons basketball taught me: Three years of basketball camp
Father’s Day 2018: Dad’s doctor, his lawyer and a discussion on careers

If you’ve found value here and think it would benefit others, please share it and/or leave a comment. To receive all the most up to date content from the Big Words Blog Site, subscribe using the subscription box in the right-hand column in this post and throughout the site, or add my RSS feed to your feedreader. You can follow me on the Big Words Blog Site Facebook page, and Twitter at @BWArePowerful. Lastly, you can follow me on Instagram at @anwaryusef76. While my main areas of focus are Education, STEM and Financial Literacy, there are other blogs/sites I endorse which can be found on that particular page of my site.

I still don’t have a car in 2018: A story about playing financial chess

“Most successful people operate off a healthy fear of failure!”

Three of the principles of my blog are: Creating Ecosystems of Success, Wealth Building and Long-Term Thought. Hell, I’ll also pull in both Creative and Critical Thought. As we’re riding into December of 2018, I’ve wondered what to write next. A friend of mine who runs her own magazine and has her own audience suggested that I write something about budgeting. I do intend to do that, but my mind thought back to something I wrote on the Examiner several years ago which will serve as a nice prelude to budgeting. It involves several important considerations when budgeting, and it might admittedly ‘trigger’ some people, but try to keep in mind the overarching messages.

I originally published a series called; You Still Don’t Have a Car Yet? around 2012. It was inspired by a question from a lady friend who went to my church and whom I briefly dated. We bumped into each other again one Sunday and she was surprised that I still didn’t have a car after getting rid of my old Saturn SL2 which was on its last leg. I heard in her voice that there was more to her question – something I’d experience again in the future.

It’s a topic that never gets old, and instead of resurrecting and republishing the entire series, I’m simply going to pull out its main points and discuss why I still don’t own a vehicle six years later. Keep in mind that this piece was written from the perspective of a single man (due to life circumstances), and your life may be different. I hope you enjoy it and that it inspires discussion in your own circles. So, let’s dive in.

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My personal finances crashed and hit rock bottom right around 2011 – two years into my federal science career. I started my career with very little savings based upon my educational path and life circumstances. I was still a new homeowner and just paid out my entire $8,500 “Obama Tax Credit” for a condominium project I didn’t know about before closing – the first of many ‘assessments’ over the years which ended up equaling the price of a brand-new car. I also tried my hand in the investing world, at one point trying to do too many things at once, both money- and time-wise. The result was getting into a debt hole of greater than $20,000 on top of my student loan and other bills.

Around that time, I was fortunate that two friends shared Dave Ramsey’s “Financial Peace University (FPU)” with me and over the course of the next five to six years, they invited me to help teach the class with them at our church. I was also fortunate that I met a mentor who ‘adopted’ me into his group of proteges. He was very strong-willed and had a business background. He both taught me and stayed on me about some important aspects of money including: understanding what a ‘Net Worth’ is, saving into my retirement account and getting my ‘Matching Contribution’, and understanding the ‘Law of Compounding Interest’.

Now armed with this new information, it started guiding my decision making. FPU is admittedly just one of many financial programs out there, and it works very well. There are several others, but for the sake of my familiarity with it I’ll discuss it. A major pillar of it is budgeting – numerically think about your ‘needs’ and ‘wants’ with the aim of getting out of debt, building up an ‘Emergency Fund’ and then positioning yourself to stay ‘liquid’, invest, and give. To get a feel for why this important, I’ll once again refer you to back to Ylan Q. Mui’s 2016 article from the Washington Post entitled; The shocking number of Americans who can’t cover a $400 expense.

This is a good place to introduce the concept of ‘Cash Flow’. Cash flow is simply the amount of money you have left over once all your monthly bills and obligations are paid. The greater your expenses and debts are, the less cash flow you’ll have. The less they are, the greater your cashflow will be and the more life choices you’ll have. You’ll probably also have a healthier state of mind and body as financial stress can impact your overall quality of life.

When I looked at my budget in 2012, I sought to identify where I was trying to go in life and then what my needs and wants were. I wanted to live in a place of abundance, and I didn’t ever want to feel the shackles of debt again. I also didn’t want to be in position to have to ask relatives or friends for financial help ever again. Finally, I wanted to go that next step where I had an emergency fund, where I could get some investments, and lastly where I could help others – giving back to my alma maters for example.

While there were quite a few surprises in my condominium complex, it was a smart buy because it was right next to the metro. As such owning a car became less of a priority. Let’s unpack that a little bit. Keep in mind that I’m not telling anyone that they should get rid their car.

For you it might be something else and this would admittedly my approach may not work in cities like: Atlanta, Buffalo and Charlotte. In any case when I looked at my budget, getting rid of my car meant getting rid of: car insurance, gas charges, upkeep and maintenance, having to renew the vehicle’s registration, and any other associated costs. The state of Virginia charges personal property taxes on vehicles for example.

Yes, it was strange at first not having a car in my parking space and not being able to jump in a vehicle and drive off whenever I wanted to. As I describe later though I adjusted. It was a ‘trade off’ as the great Dr. Thomas Sowell says – giving up something in the short-term for what I saw as a greater gain in the long-term. I included the game of Chess in the title because like this, winning that game involves an understanding of the value of the pieces in your army, and in some cases, sacrificing your lesser pieces early on to ultimately win the game.

Let’s move on to some other important concepts. Among the things I learned from Robert T. Kiyosaki’s Rich Dad Poor Dad books were the concepts of ‘Assets’ and ‘Liabilities’. Under Robert’s definitions, assets are things that put money in your pocket every month, while liabilities are things that take money out of your pocket every month.

One of the things he described in his books under liabilities was cars. Was he saying not to buy cars? No, but he was encouraging his readers to look at finances in alternative ways – in this case while cars are symbols of power for some people, they also ultimately take money out of our pockets.

Speaking of which, something that’s been documented in numerous books and which wasn’t explained to me early on was that brand-new cars depreciate significantly as soon as you drive them off the lot. This is something I pondered as I decided to get rid of my car and not immediately get another one. I also realized that I was never really a ‘car guy’ meaning that I never really fantasized or obsessed over them. In fact, I got to a point where saw them as ‘necessary evils’ in a way which were put here to keep us dependent on the energy and auto industries, and at the mercy of those running them.

I’d like to now introduce the concept of ‘Minimalism’. Though this was always a part of my nature, I didn’t know what exactly it was though I had been called both ‘cheap’ and ‘frugal’ in my lifetime. Minimalism is basically the practice of getting what you need, and not wastefully looking to consume more. I credit writer and YouTube content creator Aaron Clarey for the term because I first heard it from him – something he encourages – something which goes against the grain of most of our society. If you’re in the mood for a laugh, his video content on culture and economics are both very funny and insightful.

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“If you live right next to the metro, why would you own car?” I’m going to say something controversial here. I’ve gotten this reaction from a certain group of people. It’s the same group of people who are content to eat soup and sandwiches according to my Dad as described in my piece entitled; Challenging Misconceptions in Wealth, Income and Privilege. I’ve gotten the ‘side-eye’ from another group of people, and for the single guys reading this, I’ll just say that many ladies frown upon a man who doesn’t own a car. Interestingly the other more important aspects I described above usually don’t come up in conversations about why I don’t own one.

I’ve also been ‘clowned’ about it in some instances. When you’re doing something like this, knowing in your heart why you’re doing it, and keeping your goals in mind is very, very critical when someone challenges you. Oh, and if you’ve thought it out and it’s working, don’t argue with anyone over it. It’s not worth it. This is an instance where even in adulthood, being the leader of your own life and not caving into peer pressure is key.

How does one get by without owning a car? Well again it helps to live right next door to a metro system. My first year of college at SUNY Brockport, I was amazed by the number of classmates from New York City who didn’t have their driver’s licenses. Where they were from, they just didn’t need them and openly admitted that.

Once I got rid of my car, I now noticed that there were quite a few other people in the Washington, DC metro area using “Zipcars”. Then within the last couple of years ‘ride share’ programs and ‘apps’ like “Uber” and “Lyft” became prevalent. Admittedly if you need to go to an area that’s further out, it usually requires some planning – maybe using a Zipcar, or maybe just renting one, but again you must keep your overarching goals in mind.

Again, it’s a tradeoff. There’s a definite convenience to getting in your car whenever you want to and zipping off some place, and that’s what you’re paying for when you own one unless of course it’s giving you some sort of social prestige or personal confidence boost. How much is that convenience worth to you?

So in summary, again I’m not telling anyone what they should do with their lives. I chose to make a tradeoff (a car and certain people) with specific goals in mind. Now that I had a grasp on money and finance as described above, my new ‘drivers’ (no pun intended) were:

• To become ‘financially peaceful’ and to build wealth;
• To be able to handle all the costs associated with homeownership – something I stumbled into which came with its own set of financial costs and surprises and;
• To maximize my cashflow so that I could save, invest and to be able to give.

In terms of giving, we often think about giving to our churches and alma maters but sometimes there are other needs. A fellow alumnus from Johnson C. Smith University recently needed to raise money to buy winter clothes for the students at his school in Grand Rapids, MI. Because of some of the personal choices I’d made, I was easily able to support his effort and help the kids in his community stay warm this winter.

Again, major components to all of this are long-term thought, and budgeting which I’m going to cover shortly in its own blog post. Another important piece is being a secure individual, following the beat of your own drummer and not being peer pressured into keeping up with other people’s thoughts of what’s acceptable for your life. The other piece is being malleable and willing to continue to learn more information and applying it to your life.

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I’m going to end this post with some quotes. The opening quote for this piece is from the popular and outspoken sports talk show host Colin Cowherd who weaves life parables into his sports commentary. This one involves our personal drivers and motivations. “My investing advice to the average individual, is don’t be average,” is a quote that has stayed with me from Robert Kiyosaki’s books. It involves thinking outside of the box and doing the opposite of the crowd.

Dave Ramsey’s famous quote is, “We’re going to live like no one else, so later we can live like no one else!” It involves making temporary sacrifices for greater gains later. Finally, one of the content creators on a YouTube show I regularly watch often says to, “Keep your savings high, and your overhead low!” I think you get the picture. What are your motivations and where are trying to go in your life?

Thank you for taking the time to read this blog post. If you enjoyed this one, you might also enjoy:

Your Net Worth, Your Gross Salary, and what they mean
A look at the Law of Compounding Interest and why you should care
My personal experience with Dave Ramsey’s Debt Snowball revisited
The difference between being cheap and frugal
We should’ve bought Facebook and Bitcoin stock: An Investing and technology story
Challenging misconceptions and stereotypes in class, household income, wealth and privilege

If you’ve found value here and think it would benefit others, please share it and or leave a comment. To receive all of the most up to date content from the Big Words Blog Site, subscribe using the subscription box in the right-hand column in this post and throughout the site, or by adding the link to my RSS feed to your feedreader. Please visit my YouTube channel entitled, Big Discussions76. Lastly follow me on Twitter at @BWArePowerful, on Instagram at @anwaryusef76, and at the Big Words Blog Site Facebook page. While my main areas of focus are Education, STEM and Financial Literacy, there are other blogs/sites I endorse which can be found on that particular page of my site.

Ohio State 62, Michigan 39: My short take

Okay I’m going to try to keep this short. As one of the many Michigan football fans still hungover from yesterday’s 62-39 loss in Columbus, the idea to write a short take on yesterday’s annual game literally came to me during the conclusion of a church service here in my hometown of Buffalo, NY. I’m not trying to be funny, but it’s true. In any case here goes.

First, I want to sincerely congratulate Head Coach Urban Meyer and his staff, the Ohio State Football Team, and their fan base. They did a great job preparing for the game and they executed their game plan damn near perfectly. Despite the rankings and all the chatter leading up to the game, I had a feeling they were going to play at a high level and they did. I also want to note that the game seemed to be officiated fairly and there was little controversy surrounding this contest as was the case in 2016.

I watched the game with my usual crew at Buffalo Wild Wings on Niagara Falls Boulevard in Tonawanda, NY – our annual spot for watching the two school’s annual meeting. What stood out to me as the game unfolded, was that our team didn’t seem to be prepared for the contest in terms of intensity or scheme. Offensively, the game started off positively with a nice run by Karan Higdon. The second play was a pass play in which Shae Patterson got sacked which was a bit of a head scratcher for me, as I would’ve gone back to the running game.

In general, the offense did what it had done all year long which was to try to pound the ball with occasional shots down field. Throughout the year despite its talent level, our offense was never a consistent force, but instead methodically picked and chose its spots with varying amounts of success – sometimes due to a lack of execution, and at other times due to questionable play calling. This worked well as long as the defense stood its ground and repeatedly got the ball back which brings me to my next point.

Early on it was clear that Ohio State’s approach to our physical and blitzing defense was to get the ball out of Dwayne Haskins, Jr.’s hands quickly using crossing and wheel routes out of the backfield. In instances where Ohio State spread its receivers out and were able to neutralize Coach Don Brown’s pass rush, Haskins which is not known for his mobility was able to run the ball up the middle and slide when our coverage held. In other instances, Ohio State was able to draw pass interference calls on our defensive backs which were left on ‘islands’ by themselves in ‘Man’ coverage – No. 28 Brandon Watson particularly got targeted and torched by Haskins. Their running game by itself didn’t hurt us so much.

Approaching halftime, our Wolverines were down 21-6, and with the Buckeyes getting the ball back after the half, it seemed as though it was going to be a maize and blue ‘blood bath’. A special teams fumble by the Buckeyes helped put us in position for Chris Evan’s touchdown late in the second quarter. If not for that gaffe, we would’ve been in serious trouble. That said there was a potential touchdown that we missed out on because Zach Gentry couldn’t secure the ball after a Buckeye defender slapped it out of his hands.

On both sides of the ball as the game progressed it seemed that Jim Harbaugh and his coaching staff were being outcoached by Urban Meyer and his. Our offense started slow, interestingly didn’t seem to be taking advantage of our three talented receivers: Donavan Peoples-Jones, Nico Collins and Tariq Black. I also wondered why our 6’8” tight end Zach Gentry wasn’t getting targeted more. In a game of this magnitude, we needed to challenge the Buckeye defense more downfield especially when they were ripping our defense to shreds and scoring at will. This brings me to my next point.

My comments on many of the postgame YouTube press conference footage mostly involved my surprise that Don Brown seemingly didn’t look at what Indiana and Northwestern had done his defense and planned for Ohio State to do the same thing or more. During the game, I wondered if he would adjust his blitzing style, and go with more defensive backs, like how Bill Belicheck and Bill Parcells did to my Buffalo Bills in Super Bowl XXV where they slowed down the Buffalo Bills’ powerful offense. Instead he seemed to stick with the same game plan which he used all year which brings me to my last point.

It’s very easy for us as fans and commentators to criticize what’s happening on the field and I acknowledge that. I’ve also never coached a sport though it’s something I’d like to try one day. That said, I know enough to know that in athletics, particularly in big games it’s important to be able to adjust your plan of attack if necessary – or to anticipate having to do so. I discussed this in my interview with legendary Niagara Falls high school basketball Coach Pat Monti, who thoroughly scouted his opponents and figured out what he needed to do to give his teams the best chances to win even if meant making games ugly and unwatchable.

As we’re closing in on the end of Jim Harbaugh’s fourth year, this is something I’m wondering about, and something I wondered about during yesterday’s game. As much fanfare as there was when he got hired, how well can he and his staff really coach when going head to head with opponents like Urban Meyer and his staff on the opposite sideline? I asked myself this for the first time as yesterday’s game unfolded. One of my buddies I watched yesterday’s game with came down hard on defensive end Rashan Gary who was the top high school player five years ago and with good reason. That said it’s the coach’s job to motivate the players and put them in position to succeed. While we support him, right now, me and others in the fan base are questioning the ability of our coaching staff to do this on the biggest stages.

What’s going to happen from this point on? I honestly don’t know. I’m going to close by saying that I feel bad for our players, some of whom may have been looking ahead to Indianapolis and beyond – some of whom who have never beaten Ohio State which is something they’ll always have to live with. As we got closer to the Ohio State game, I became weary of talk of the “Revenge Tour” and Karan Higdon’s guarantee of victory as the team, the program and the fan base might suffer a black eye like we have now. Anytime ever I’ve competed, I’ve never been a trash talker and am a firm believer in just letting your play do the talking.

Like Michael Jordan’s Chicago Bulls teams who couldn’t get over the hump, for the remaining players and staff, perhaps this humiliating loss may be a part of their growth process that will eventually push them over the hump. We’ll have to wait and see. This year the Wolverines will once again be in Ann Arbor during the College Football Playoff. Hopefully Coach Harbaugh and his staff will ready first for their bowl game, and then when the Buckeyes come back to Ann Arbor in 2019. There’s a whole year to think yesterday’s game over.

Thank you for taking the time to right this blog post. If you enjoyed this one, you might also enjoy:

Michigan loses to Ohio State 31-20: Reflections on the 2017 game and the season
John U. Bacon presents his new book Endzone to Michigan’s D.C. Alumni Club: A look back
Michigan defeats Maryland 35-10: Two weeks until the 2017 Ohio State game
Michigan beats Florida 33-17: A recap of the maize and blue’s season opener
The 2016 Michigan-Ohio State game, the Big Ten Officials, and the College Football Playoff

If you’ve found value here and think it would benefit others, please share it and/or leave a comment. To receive all of the most up to date content from the Big Words Blog Site, subscribe using the subscription box in the right-hand column in this post and throughout the site, or add my RSS feed to your feedreader. You can follow me on the Big Words Blog Site Facebook page, and Twitter at @BWArePowerful. Lastly, you can follow me on Instagram at @anwaryusef76. While my main areas of focus are Education, STEM and Financial Literacy, there are other blogs/sites I endorse which can be found on that particular page of my site.

A look at the Law of Compounding Interest and why you should care

“Compounding Interest is the ‘Eighth Wonder of the World’. He who understands it, earns it. He who doesn’t, pays it!”

Note. Like my Net Worth piece, the subject matter of this blog post is not new. It has been known for years by those who’ve learned about it in their families, learned about its concepts in business school, or who have discovered it on their own. It’s a discussion from my personal perspective which I think is worth visiting. Also, while this is a ‘money’ topic, I’m discussing it from a ‘scholarly’ perspective. I’m not rendering financial advice where I’m telling readers what they should do. In the spirit of the first principle of my blog, Creating Ecosystems of Success, I’m simply introducing a concept and discussing why it’s important for the lay person, so they can make their own life choices.

* * *

“Because we’re getting our Ph.D.s and we’re in school for so long, we won’t start making our money until much later,” my lab mate and senior graduate student Damon adamantly said. “When you save and invest your money, it doubles about every 10 years, and we’re missing out on the ‘doubling cycles’! The classmates I attended Colgate University with, who’ve already gotten out and started working, are already seeing their money double!”

To start this off with some humor, coming from Buffalo’s eastside, anyone named Damon I’d ever met up to that point was black, but this Damon was of Greek descent. Damon was a very smart, opinionated and short-tempered guy. He was knowledgeable on numerous topics: current events, politics, and economics, and I loved talking with him while in our research lab as I always learned something.

Damon introduced me to one of my current heroes, Dr. Thomas Sowell and let me borrow his copy of Inside American Education, which Dr. Sowell wrote. I didn’t know it, but that day while our Pharmacology experiments ran, Damon gave me my first lesson ever on the “Law of Compounding Interest”. I was in my late 20s, and similar to my learning about the ‘Net Worth’ and a ‘Matching Contribution’ concepts, it was late in the game, but still much earlier than many people learned about it. So, let’s talk about the Law of Compounding Interest and why we should all care.

As opposed to trying to piece together an explanation of Compounding Interest myself, I’m going to simply reference the book How To Turn $100 Into $1,000,000 which I referred to in my post entitled, Challenging misconceptions and stereotypes in class, household income, wealth and privilege. In that story I talked about how my mentor challenged me to read what appeared to be a children’s book. While it is written for children, the book contains lots of valuable information that many adults don’t have a handle on – even those in their 40s and beyond. Since reading the book I’ve consequently given copies to my younger cousins and other youngsters in my circle to give them the chances I didn’t have. You should too!

Before discussing the Law of Compounding Interest, I’m going to jump ahead to Chapter 9: Investing, because for the sake of this post, it needs to be introduced first. According to Chapter 9, investing is defined as, “Putting your money into something that can potentially make you more money.” There are lots of investment classes out there: Stocks, Real Estate, and Businesses of all kinds.

Coincidentally, the same buddy I discussed in my post entitled; We should’ve bought Facebook and Bitcoin Stock, recently approached all of us, looking for ‘investors’ because he wants to start his own Amazon store – a ‘speculative’ investment. When you think about the Law of Compounding Interest though, you want to think about putting your money in places where it will steadily ‘appreciate’ over time – someplace safe where you’d place your retirement savings for example (discussed below).

Two important concepts to understand here are ‘Principal’ and ‘Interest’. Financially, Chapter 8 assumes readers understand the meanings of Principal and Interest in the context of getting a ‘Return on Investment’ (ROI), as opposed to the borrowing context where you’re paying someone else interest on a loan. The chapter quickly starts discussing how Interest can steadily build your Principal from year to year.

If for example you have a $100 and it’s invested in something at a 5% interest rate after one year, you’ll have earned $5 so your total principal at the start of year two will now be $105. If you keep that $105 principal invested, it will earn the 5% and not the $100, so your new total after year two will be $110.25, and so on. This is just an example, and this is just with the starting a principal of $100, but what if you started with a greater principal – let’s say $2,000, and you steadily added more money to it every month for 10-20 years? For retirement purposes the ideal scenario is to be invested for 40 years allowing one to retire well at age 65. Ideally the person should have started investing/compounding at age 25. However, getting started at any age is the key.

The second aspect of the Law of Compounding Interest discussed in the book is the “Rule of 72” on page 84. The Rule of 72 is a calculation which allows investors to determine how long it will take for their money to double based upon a given interest rate. To determine this number, you simply divide 72 by the interest rate that you expect to earn over time. The higher the expected ‘Rate of Return’, the less amount of time it takes to reach your goal. For example, if you divide 72 by an interest rate of 10%, it would take 7.2 years for your money to double. If you divide 72 by an interest rate of 2% the time would be 36 years – hence the importance of looking for the most competitive rate of return relative to your personal risk tolerance when looking for investments.

The chapter cites two more examples which highlight the importance of continuing to add to your principal and then the importance of time. The example on page 86 shows the difference in returns when two siblings both start with a $5,000 investment at the same age at an interest rate of 8%. One sibling continues to contribute to her account out to age 50 – that is $1,000 every year and arrives at 50 years of age with $750,000. The other doesn’t contribute anything further and arrives at 50 years of age with a total of $200,000.

The last example on page 87 gives an example of two people who start investing at different times in life. In this example both subjects become millionaires by 70 years of age. The first individual started saving $1,000 per year starting at age 15 and paid in only $55,000 to reach their $1,000,000. The second individual started at 30 years of age and had to put in a total of $140,000 to reach their $1,000,000. The take home lesson here is that because the first person started earlier, it took them less than half the principal of the second person the reach their $1,000,000.

* * *

My classmate Damon’s words at the start of this post, underscores these last two points. Our peers who started working immediately after earning their Bachelor’s degrees, were in theory able to start taking advantage of the Law of Compounding Interest earlier, assuming they knew to do so. Working towards our Ph.D. s, we wouldn’t be able to start the process until much later. But there were other professionals from our peer group who were getting even later starts than us due to the nature of their fields and the amounts of debt incurred during their educations; the Law and Medical students come to mind.

There’s another piece to this though. What about individuals who didn’t go the college route at all? They too would’ve been able to start using the law earlier in life assuming they knew about it and followed it. So, as I’ll describe below, having a degree has nothing to do with using this law.

Who should care about the Law of Compounding Interest? Everyone. That goes for STEM professionals like me and Damon, ‘Blue-Collar’ workers swinging hammers, Cooks in the kitchen, Lawyers in courtrooms, non-degreed individuals, business owners/entrepreneurs – everyone. No matter what your profession is, you only must know about the law, start it, and start it as early as you can.

To start using the law and to using it correctly, one must embrace two of the principles of my blog; the learning of Financial Literacy/Money, and Long-Term Thought/Delayed Gratification. Thus far in my writings I’ve discussed the latter principle sparsely, but it’s key here because to take advantage of the Law of Compounding Interest, the individual must think long-term. This means that they must be disciplined enough to live without a certain percentage of their paychecks every month.

They’ll also forgo or delay some short-term luxuries and indulgences for greater gains later – playing the game of ‘Chess’ in a way. This isn’t something that’s necessarily easy to do in the presence of considerable peer, societal, and in some instances familial pressures. See my Mother’s Day 2017 post, to get an idea of how to lose both money and time due to personal and cultural pressures.

What are the real-world applications for this? I’ll cite two articles. The first is by Rodney Brooks of the Washington Post. I cited his article entitled; 71 percent of Americans aren’t saving enough for retirement in my post about the Tax Reform and Jobs Act. It discusses reasons why people can’t take advantage of the Law of Compounding Interest. Another piece is entitled; Club Fed millionaire: Membership 23,000 and growing by Mike Causey which discusses the growing number of federal employees who are retiring as millionaires – most self-made. I’ll say it again, the majority are self-made meaning no one gave them anything, and they simply methodically prioritized, saved, and invested their money.

There’s a final context for the law, and that’s giving. When you think about Higher Education, Philanthropists and generous alumni often leave gifts to their schools of choice through ‘Endowments’, many of which are invested so that they’re continuously compounding and generating returns used for scholarships and operating expenses. The famous Jim Kramer runs his “Charitable Trust” of which he is continuously thinking about out how and where to safely invest its funds for charitable purposes. Lastly, consider how the lives your relatives and your community could be changed by having a continuously growing principal and interest you can use in any fashion you see fit: saving up a down payment on a home, college tuition expenses, seed money for building businesses, supporting political campaigns, etc.

* * *

If it sounds like an underlying theme of this post and others like it is that your financial (and life) success is about what you know and don’t know (outside of your profession), then you’re correct. In an upcoming story I’m going to discuss how I didn’t understand these pieces when I first started my federal science career and didn’t take advantage the Law of Compounding Interest or the federal government’s ‘Matching Contribution’ – both of which have cost me money. There were actually several personal ‘blunders’ in these areas.

The opening quote for this piece is from the famous Physicist Albert Einstein and it pretty much sums up the importance of this topic – either you’re getting paid, or you’re paying out. Compounding Interest is something anyone can take advantage of regardless of: race, creed, color, sex, gender or religion. One just must know about it, and then start living by it. If they don’t know about it, they must be curious enough to find out about it. Most financial literacy programs cover it in some way.

There are other necessary pieces such as ‘Budgeting’ which I’ll cover as well in another post. As I stated in my Net Worth piece, it’s not something that can be worked out with your boss, or even legislated by the government, though I do think schools could do a better job of teaching this information at an early age. In closing, two other principles of my blog do tie in here, and they are Self-Accountability and Self-Reliance, because first, the individual must realize that no one can make them practice and incorporate this law into their lives, and secondly, it’s themselves who have to do it. And with that, I hope you’ve learned something here about the Law of Compounding Interest.

Thank you for taking the time to read this post. If you enjoyed it, you might also enjoy:

Your Net Worth, your Gross Salary, and what they mean
The difference between being cheap and frugal
We should’ve bought Facebook and Bitcoin stock: An investing story
Challenging misconceptions and stereotypes in class, household income, wealth and privilege
What are your plans for your tax cut? Thoughts on what can be done with heavier paychecks and paying less tax
My personal experience with Dave Ramsey’s Debt Snowball revisited
Mother’s Day 2017: One of my mother’s greatest gifts, getting engaged, and avoiding my own personal fiscal cliff

If you’ve found value here and think it would benefit others, please share it and or leave a comment. To receive all of the most up to date content from the Big Words Blog Site, subscribe using the subscription box in the right-hand column in this post and throughout the site, or by adding the link to my RSS feed to your feedreader. Please follow visit my YouTube Channel entitled, Big Discussions76. Lastly follow me on Twitter at @BWArePowerful, on Instagram at @anwaryusef76, and at the Big Words Blog Site Facebook page. While my main areas of focus are Education, STEM and Financial Literacy, there are other blogs/sites I endorse which can be found on that particular page of my site.