Disappointed

by debtfreesaints on June 24, 2009

I’m really disappointed today in Mark Sanford.  Obviously, there were some really bad things going on under the surface for him to make such an error in judgement.  I think he does realize what he did wrong, and I hope that he will repent and make better choices.  I also hope that he and his wife are able to reconcile.  What an awful, awful thing.

…One more comment on this.  It seems that all the press can talk about is the impact this has to Sanford’s political career and to the Republican Party.  Those things are tiny compared with the impact that this has on his wife, his children, and his relationship with our Heavenly Father.  Those are HUGE things.  Infinitely huge.  The state of South Carolina and the Republican Party are fine.  The repurcussions on his relationships with his family and with his God are not.  I hope he can repair them.

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Stop Making Minimum Payments on Your House

by debtfreesaints on June 20, 2009

Pretty much everyone knows that it is a really bad idea to just make the minimum payments on a credit card.  If you only pay the minimum, you might never pay it off, and even if you do, you’ll pay a huge amount of interest during the years it takes you to pay off your loan. 

Did you ever think about how a 30 year mortgage is essentially equivalent to making minimum payments on your house debt?  Look at your statement, and look at the interest amount that you paid last year.  For us, it was $13,922.87.  That’s almost $14,000!!!!  Can you imagine all of the awesome things we could do with that money if we weren’t paying it to the bank.  But, of course, we are in a standard loan, so we are paying it off, albeit slowly.  Last year, we paid off $4,623.37.  Now, if I told you that I had $50,000 in credit card debt, and last year I paid off 4500 of it, and also paid 14,000 in interest, you’d tell me I was crazy and that I should pay that thing off ASAP.  But…when we look at mortgages, we get these lengthy explanations about how we can make so much more in the market, and the interest rate is so low, etc, etc. 

The best time to pay off your mortgage is early in the mortgage.  Stop making minimum payments on your house.  In my family, we’ve now made a very serious commitment toward paying off our house in short order, and with God’s help we’ll make it.  (Maybe more to come on that in future post.)  I hope and pray that if you still have a house to pay off, that you’ll make a similar comittment.

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A major award!

by debtfreesaints on June 14, 2009

I always feel so privileged when I get emails like this.  Somehow I got on some Nigerian spam email list, so a few times a year I find out that I have been awarded some large amount of money.  To anyone in doubt, these are all scams.  You should not email back.  Once you have shared the email with friends and family and gotten a good laugh, you should get back to more important things.  You can read the wonderful email I got below:

Contact for Processing:
CLAIMS PROCESSING OFFICER:
Mr. Shffie Bin Hassan
EMAIL: exxonmobilpromo55@yahoo.com.hk

Tel:-              +60163859365
                      +60125493611
====================================
(Congratulations!!!)
Date:13-06-2009.

        This E-mail is to inform you that you Awarded $500,000.00 US Dollars ATM CARD on our online draws by the ExxonMobil Oil Company, Malaysia.This Draw is part of our Yearly Bonus to all internet users World Wide,This email is randomly sent to 10 people worldwide.Your email address was attached to Reference Number: MY0/2057/1286 and Verification number is: (EM2009-10/6) which subsequently won you in the {2nd category B} matches 5 Bonus.You have therefore been approved by the ExxonMobil Oil Company Payment Service to claim a total sum of ($500,000.00 US Dollars ATM CARD).

You are also advised to provide him with:

1.Full Name:……………….
2.Address:…………………….
3.Phone number:………………..
4.Age:………………………..
5.Gender:……………………..
6.Occupation:………………………….
9.Country:…………………………….

    We know you must be excited and very happy about this news you have just received from us and the truth is that we are doing this to put smiles into homes and hearts of people worldwide. Special greetings from the entire Staffs of United NationsTrust Funds Worldwide.

Yours Sincerely,
A’shadieeyah Fatimah Khatoon
(Online Co-ordinator)

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How to Evaluate a Multi Level Marketing Opportunity

by debtfreesaints on June 11, 2009

I’m going to give you a really easy way to evaluate a multi level marketing opportunity. 

The rule is:  If you would buy the product at the price advertised even if there wasn’t a business opportunity associated with it, then you should go ahead and evaluate the business side and see if it’s worth it.  If not, then do more important things with your time then look into the MLM, no matter how intriguing the money aspect is. 

For example, if you would pay 30 dollars a bottle for mangosteen juice just because you think it’s worth it, then maybe you should sell it too.  But if you only think it’s worth it because of the great opportunity you would have to sell it to your friends and neighbors, then run away.  You shouldn’t be involved.  Pyramid Schemes are based on the premise of people only making money if they get others to join as distributors.  Real businesses are based on great products that people want, whether they are selling them or not.  These businesses can succeed irregardless of the distribution method. 

LDS, Mormon, lds, mormon

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Use the windfall to pay off your mortgage

by debtfreesaints on June 9, 2009

Early in my career at Intel, I became friends with two different people who were here during the 90’s when the stock was doubling and tripling.  During that time, it looked like it would keep going up forever and almost everyone was planning for an early retirement. 

Well, in 2000 the stock crashed, and 9 years later it is lower than ever.  Shortly after the crash, I found out that one of my new friends had sold enough of his stock near the peak to pay off his mortgage.  Even though the stock had crashed, he felt good that he had no debt and could deal just about any economic calamity because he knew his family had a roof over their heads.  I found out shortly thereafter, that another friend had exercised his Intel stock options at the peak, but rather than sell them and keep the money (and pay higher taxes) he bought them at the peak.  He had to pay a large alternative minimum tax on the difference between the value he was able to buy the options at and the value they were worth when he bought them, which happened to be the lifetime peak of the stock’s value for Intel.  He didn’t, and this is key, sell enough of the stock to pay that tax.  He either didn’t realize it was coming or he didn’t think it would be a big deal to pay it later.  This decision proved to be tragic, as the value of the stock plummeted that same year, and he ended up owing about the same in taxes as his stock was now worth.  He then made another tragic mistake.  He assumed the stock would go back up soon, so he took out a second mortage on his house to pay the taxes and he didn’t sell any of his stock.  Eight years later, that stock is now worth half the value it was then.  When I asked him why he didn’t just sell the stock and pay off his house or at least diversify into some other investments, he said that he was sure Intel’s stock would just keep going up.  It seemed like the best investment out there.

There is a financial moral in these stories.  First, watch out for your tax liability.  Make sure that when you sell, you set enough aside in a safe bank account of something for the taxes.  Second, use the windfall to pay off your debt.  There is no more stable investment than that.  Third, if you already have all of your debt paid off, then diversify your investments. 

When a windfall comes your way, I hope that you’re able to enjoy the peace that my first friend enjoyed and not the disaster that my second experienced.

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Have Faith

by debtfreesaints on June 2, 2009

And Christ hath said: If ye will have faith in me ye shall have power to do whatsoever thing is expedient in me  –Moroni 7:33

And again, verily I say unto you, concerning your debts–behold it is my will that you shall pay all your debts.  And it is my will that you shall humble yourselves before me, and obtain this blessing by your diligence and humility and the prayer of faith.  — D&C104:78-79

 

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Check out this story on how one couple got totally out of debt, including their house:

http://www.freemoneyfinance.com/2008/01/how-i-paid-off.html

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Dave Ramsey’s Car Advice

by debtfreesaints on May 28, 2009

I heard a great rule of thumb on Dave Ramsey’s show tonight.  Add up the value of the cars you own, paid off or not.  (If you’re not sure of the value, you can go to http://www.kbb.com)  This combined value should not be more than 50% of your annual income.  If it is, even if you own the cars outright, too much of your money is in an asset that is going down in value. 

For example, let’s say you make $50,000 a year.  Let’s say you own 2 cars that you’ve recently paid off with your Debt Snowball.  One of those cars is worth $18,000 and the other is worth $12,000.  That’s $30,000 you own in cars.  Hopefully you really like them, because they will be going down in value every year.  In light of how much you make a year, you’d be better off selling your cars, buying cheaper ones and then investing the difference.  Let’s say you did that, and ended up with $15,000 in cars instead of $30,000.  You then invest that excess $15,000 a year and make 10% a year, giving you an extra $1,500 a year.  That offsets the amount you lose in the 15,000 worth of cars that drop about 10% a year.  The alternative is to keep the expensive cars, which will decline about 10% a year, causing your total assets to drop $3,000.  The choice seems clear. 

A quick side note on this.  I have a friend that retired around age 50.  He had worked for Intel for many years and I figured that he’d gotten rich off of stock options.  He did make some money that way, but the secret to his early retirement was more clear when he picked me up for a ride to work one day.  I was suprised to see him pull up to the house in a very old brown sedan.  The car looked about 30 years old.  My first thought was, if he has all of this money, why doesn’t he buy a nicer car?  And then I thought, that’s why he has all of this money and is able to retire early.  He values freedom and the ability to help his wife (who has MS) more than a nice car.

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I read a fantastic article yesterday in the Wall Street Journal about Chile’s ability to fund a stimulus plan from cash reserves, because they were extremely wise about saving money when times were good.  This is the example we should follow in our country as well as in our personal lives. 

http://online.wsj.com/article/SB124337806443856111.html

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Check out the June Ensign.  There is a lot of great information in there about becoming debt free, living providently, etc.  Something I love about it is the practical advice and counsel that you can use immediately.  My faith in the power of tithing and provident living has greatly increased during the past six months.  The articles in this month’s Ensign reflect that faith.

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Payments on Toasters

by debtfreesaints on May 17, 2009

I served my mission in Ecuador about 12 years ago.  I remember the first time I saw a large, new television set in a cane house.  It was such a stark contrast, but it  became a rather common occurrence for me.  In one such house, we asked the family to come to church, but they declined because someone always had to be home to keep the television from being stolen.  When they weren’t home, they were generally out working in order to make the payments on the TV. 

Another person I met had a toaster, and I made some comment about not having seen a toaster in a while or something.  They said that it was super easy to get a toaster, you only had to pay xx sucres (Ecuadorian dollars at the time) a month.  It was some low amount, but it amazed me that they were making payments on a toaster. 

There is so much wisdom in the counsel to avoid debt, and to only go into debt for a MODEST home, or education that makes sense (e.g. HOW TO GET RICH and other such seminars are not education, they are scams–no debt allowed), or a MODEST car.  There is no reason you should ever go into debt for a TV or furniture or anything else that you can get by without.  This is not a new principle.  The leaders of the church have been teaching this forever.  Heber J. Grant said, “We cannot tell all that is coming in the future.   But there is on thing that we can tell, and that is if we have the money in our hands to buy a radio, automobile, or anything else, and we buy it, no matter how much it comes down in value it is outs.” 

A friend of mine recently had to give back his truck that he could no longer make payments on and that was underwater.  He bought an inexpensive truck in its place.  It’s too bad he didn’t buy the inexpensive truck in the first place, because the lender will probably still come after him for the amount he was underwater on the truck.  He won’t make that mistake again though.  Another friend felt that they had to buy a TV on credit, because they got a great no-interest loan, and they wanted to “establish credit.”  The words of salesmen and lenders were more present in their mind than the words of living prophets. 

Remember that Christ’s yoke is light.  His way is easy.  Part of that way includes living well within our means.  It can be hard to have the willpower at first to say no to things we can’t afford, but there is tremendous peace afterwards.  Of course, that is pretty much how it is with all of the commandments.

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Life isn’t as hard as we make it

by debtfreesaints on May 14, 2009

I realized something really important yesterday.  I realized that I make life much harder than it needs to be.  I spend a lot of time thinking about the jobs I want, the news, and other things that are incredibly temporal.  If I dropped those concerns and spent my time focused solely on my family, my relationship with God, making a difference, and enjoying the journey, then I could be much happier and I could also do a better job of accomplishing what I’m supposed to do in my life. 

So, that’s what I’m working on.  Focusing on what’s important, making a difference, and enjoying the journey.  It’s a wonderful life.

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L. Tom Perry and the Gift of Enthusiasm

by debtfreesaints on May 10, 2009

Elder L. Tom Perry wrote a wonderful book entitled Living with Enthusiasm.  The following is a quote from the introductory chapters.  It’s especially good for someone that struggles with the feeling that they’re not as talented as everyone else.

In my early years, I developed something of an inferiority complex. After all, I was part of a family in which my brothers and sisters all had great abilities. My older sister had remarkable artistic talent. She was always writing a story or poem that was used in church or in other community gatherings. I determined that since I was her brother, I must possess some artistic talent too. So I analyzed myself and determined that I since I had a strong voice I could become a great singer. I launched a childhood singing career only to discover that although my voice was strong, my range was very limited. In fact, I was a monotone, and the supply of music written in one note is extremely limited. I had to give up my singing career.
My next sister had great athletic ability. She could run faster, hit the ball farther, and catch better than any of the other children on our block. Surely I must have some of her ability, I reasoned. So I stood in front of the mirror and analyzed myself to determine what sport would be most suited to my special athletic abilities. It was obvious. I was taller than most and had average speed. I would become a great basketball player. Once again, I launched a new career. Unfortunately, it was nearly as brief as my singing career. After being hit in the head several times by passes from my teammates, I discovered that my reflexes were too slow to excel at basketball.
My next sister and my brother who was just younger than I were blessed with great minds. They both skipped grades in school, and they still managed to be ranked number one in all their classes. I used to wonder what might happen if they were ever forced to take a class together. Of course, I made no effort to compete with them.
It is interesting to read what my father wrote in his life’s history about each of his children. He wrote an entire page about each one of them, reporting their many accomplishments—that is, everyone except me. About me, the only thing my father wrote was “Tom surprised us.” That is all the good he could say about me.
Before you feel sorry for me, you should realize that in spite of my lack of talent, I was enthusiastic. I learned from a very early age what an asset my enthusiasm could be. At the dinner table, I complimented my mother so enthusiastically that she consistently gave me the biggest piece of pie. At school, I would raise my hand enthusiastically before my teacher even finished asking a question; fortunately, she would never call on me. As with Joseph, my enthusiasm often helped me turn disadvantages into advantages.
The true test of my enthusiasm came during the years I was an Explorer Scout. The Explorers in our ward had developed quite a reputation for playing volleyball. The year before I became an Explorer, they had gone to the all-Church tournament and placed second.
The year I became eligible to play volleyball, we had another good team. I went to the tryouts and did poorly. My heart was broken, but much to my surprise they selected me for the team anyway. I learned the reason some time later. You see, my father was the bishop of our ward, and the team needed new uniforms. They decided that with the bishop’s son on the team, they stood a better chance of receiving new uniforms.
As I sat on the bench that year, I fine-tuned my one talent. I had more enthusiasm than anybody else on the team. I could fire up the players and the crowd while just sitting on the bench. We went all the way to the Church finals and came in second again.
The next year my enthusiasm increased. I even played a little bit. Again, our team went to the all-Church finals, and for the third year in a row we came in second. The fourth year, my final year of playing with the Explorer Scouts, I had the great honor of being elected the team captain. We had lost all of our talented players, and there was not much of a nucleus left. We lost most of our preseason games. The members of the ward who had given the team such solid support began to stop coming to our games. As the season progressed, however, we began to improve. First we won the stake tournament. Then we won the regional tournament. We surprised our entire ward when we won the area tournament and, for the fourth year in a row, found ourselves in the all-Church finals.
In the first game of the all-Church finals double elimination tournament, surprisingly, we won the consolation championship, which allowed us to come back and compete in the championship bracket. Once again we made it to the final round to play for the Church championship.
We lost the first game 15 to 4. Our coach called me aside between the first and the second games. He reminded me that we didn’t have a great deal of talent, but it wasn’t talent that won tournaments—it was enthusiasm. He told me to go out on the court and use my enthusiasm to convince my teammates that we could win. My enthusiasm must have helped. We won the second game 15 to 10.
The third game was played very evenly, 1 to 1, 2 to 2, all the way up to 10 to 10. Then one of our players discovered the middle man on the back row couldn’t handle his serve, and the score went 11 to 10, 12 to 10, 13 to 10, 14 to 10. We were just one point away from ending a string of second-place finishes and becoming the all-Church champions.
I called time-out and huddled with my teammates. I instructed our server to hit the same spot and we would be Church champions. This time, however, the player on the other team handled the ball. He made an excellent setup to their best player, who pounded a vicious spike over the net. Fortunately, the ball hit one of our players in the chest and bounded off him. I could see the ball was rising to the perfect place and at the perfect angle for my spike. With a short run and a jump, I struck the ball with my fist with all the power I could muster. The ball hit the floor on the other side of the net, and we were the all-Church champions. Enthusiasm had carried us through.
I have never forgotten the lesson of enthusiasm that we learned in winning the all-Church volleyball championship. Someone has written that “enthusiasm is a telescope that advances the misty, distant future into the radiant, tangible present.” I believe it. I have found throughout life that my only real talent, the talent of living enthusiastically, has enabled me to accomplish much more than my modest talents would have led anyone to expect. I surprised even my father.

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You and 29 Friends Can Make a Difference

by debtfreesaints on May 4, 2009

My wife heard that Congressmen usually receive around 10 letters on any particular issue.  If it jumps up to 30, they really take notice.  Think about that.  The average district has over 600,000 residents.  If 30 of those residents write, the representative takes notice.  You do have influence.  Write or call today!

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Sharing Gospel Anchored Financial Principles

by debtfreesaints on May 3, 2009

I have a family I hometeach that is really having a hard time financially right now.  He’s looked high and low for a new job but without success.  The husband and children are not members, and the wife has been less active for years.  I took him to the employment center with me and have looked for jobs online.  Still, nothing was turning up. 

I finally realized that what they needed most from me was to teach them the laws that, when obeyed, enable us to receive the blessing of sufficient food, clothing, and shelter.  In a nutshell, these laws encompass: 1.  Putting God first in your life  2.  Keeping the sabbath day holy  3.  Helping the poor  4.  Paying tithing   5.  Praying for help  6. Avoiding debt.  

I was really nervous about how they would take me coming in and telling them that what they really needed to be doing was praying, going to church, paying tithing, etc, but I finally realized that it really wasn’t fair for me not to share these things because I’d seen them work in my life.  So, I shared them and it went really well.  I had prayed so much for Heavenly Father’s help during that visit and it was so evident.  I hope and pray that they will fully follow the counsel I gave through the spirit, but at least they have a choice now.  They can decide whether to follow God’s counsel and be blessed, or go it alone.  Our role is to provide a guide and an example as to how to access God’s blessings.  I think that teaching others about gospel principles that can bless them is one of the most important things we can do for people that are struggling right now.

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