Distraught

I'm meeting with a financial adviser today. I want to setup an asset allocation rather than just this random conglomeration of mutual funds.

Part of the prep work is to write out your financial portfolio. So today is the first time I've realized how much it has gone down in the past month. I think total I'm down about $35,000. If you take out taxes, medicare, and social security, that's probably about as much money as I'd make in an entire year.

So at this point I have to leave all that money in the market and wait for it to come back. That means my assets are essentially frozen for probably 5 years.

It makes you wonder about if I had put the money all into a savings account and waited to put it into the market till right now.

Honest

So I'm gonna be honest. I've been really slacking with my business ever since I read that article talking about how all these people are doing it better then me. I probably would still be more enthusiastic about it now, but I haven't had any luck reaching my latest investor. The prospect of paying $20 a week in parking and trying to get up to a farther away county every Friday just to get 5-10 leads isn't very inviting either. At this point I think I just need to regroup and find a better approach.

The best idea for now would probably be to attend some REI meetings, not as a "Jobber" trying to find investors to work with, but just as someone who wants to learn more about the industry. I think just taking some time to do market research and learn about the purchasing process while I look for my own house would be extremely helpful. Not only would it save me money but after going through it, I'll have experience to look back on and compare with, rather than just playing with the ideas I've read in various books.

Also, I might be able to just volunteer to work with an investor on the weekends who is already doing these deals. That way I see what they do and get some advice, since usually having a mentor to learn from is a great shortcut and extremely valuable. I've noticed that at my day job, whenever I work with a more experienced member of the staff I pick up different tips and tricks that save me time in the future. Plus, by working with an investor, I can get a better idea of the information they want and where they would go to get it.

So for now I'll keep working on trying to find a car, building up my stock portfolio and putting money into my house fund. While I do that, I can start attending REI meetings and see how things go from there. Also, I'm planning on going to a Toastmaster's club meeting this Monday, so we'll see how that goes as well.

Update of Financial Plans

So I've finally reached the point where I've "primed the pipe" when it comes to my stock portfolio.

If you've read what I've written previously, you know that I'm following the advice of The Little Book that Beats the Market in how I screen my stocks and when I buy and sell. Basically, it screens on two filters, the overall price/earnings ratio of the stock and the ROA the company gets. Each month I've been buying a couple of stocks off of the report it creates and now a full year has gone by. This is significant because owning a stock for 1 year qualifies it as a long term investment so I will have to pay the lower long term capital gains rate on the profits instead of short term capital gains.

One thing I did not do correctly based off of the books suggestions, is that I bought stocks every month this year. Instead I should have determined the total amount I wanted to invest and then put a percentage of it in every couple of months for 3 years. Since the formula is suppose to average a >=20% ROI each year over the course of a three year period, unless I continue to add to my portfolio for the next two years, I will be very heavily front loaded. If this was the market highpoint of the three years, I will have bought less for more.

Regardless, I am excited to have finished building my portfolio base. While I will most likely continue to add to my portfolio, having set this future fund up, it gives me more security. I'm planning on doing some rebalancing of where I move my money, esp since I am planning some large purchases for the next year ( a car and a house). I will most likely stop funding my separate Roth IRA and move to my company's Roth 401k program.

Another reason I'm very encouraged by this, is that now that I have a security base, I can move into a little more concentrated and riskier investment. After consulting various sources for information over the last year and a half, I've determined one source that seems to have excellent stock filters and a very broad market view. I think I'm going to build up a risky investment fund and direct the resources towards their recommendations to test what kind of results they can produce. So that will be a side project for the year to come.

Also, I've been reading Having it All. The descriptions it has about how the mind and body work have been very interesting. Some of the ideas about each person's personal beliefs shaping their reality corresponds to what is discussed in The Greatest Salesman in the World and Rich Dad, Poor Dad. It seems the part of the book I'm at now is moving in the same direction as The Pathfinder right where I am on hold. They start discussing how to figure out what your dream life would be like and how to move towards it through goal setting, positive affirmations, and directing your subconscious through positive speak and such. While this is all good stuff, I've actually come to peace with where I am for the time being. While I plan on changing things in the next year, I have established the goals I want to reach and for now I'm trying to live in the present and enjoy the situation instead of ratcheting up more and more expectations on myself. So while the advice will be helpful in the future, I'm putting it on hold until I really want to focus on it.

Things have also picked up at work. I've moved away from doing testing and bug fixing (finally) and am back to doing some development work. This is actually the main part of the job that I enjoy, so I'm trying to learn from the people I'm working with and develop a real skill that I can rely on in the future. That way, no matter how things turn out I'll have the safety net of knowing I have a desirable skill that people will be willing to hire me for.

Long Weekend

So the long weekend has come to an end. I knocked off a number of things on my "To Do" list including participating in the Buy One get One program for One Laptop Per Child. Also, I was able to test drive a few cars and focus in on what exactly I'm looking for in the one I end up buying. To top it off, the updated x-rays from the chiropractor looked good so I only need to go in every two weeks for maintenance. So, just like that a lot of my weekly routine is suddenly gone.

Disappointingly, I did not manage to get to the Real Estate Investor meeting I wanted to attend yesterday. I ended up with some schedule conflicts and difficulty finding the location the event was held. Next time I'm going to have to bring my A game and make sure to get everything inline before the date, potentially even making a dry run to the location.

I recently started reading Made to Stick, which is starting to feel like the next Never Eat Alone. It contains some solid advice about clarifying your message and saying something with meaning. I'm still early on in the book, but I like everything I've read so far. It seems to build off of part of The Tipping Point, where the idea of stickiness is introduced as part of process of viral marketing. I still have a few other books in my queue like The Art of the Start and True Professionalism, but currently they are checked out at my local library so they are pending.

The stock market has been choppy at best recently. I've taken huge hits the last three market days with a small rebound today. This market dip is actually a good thing, since a lot of stocks are dropping to under priced values. I wish I had planned to have more money outside of the market right now to move in, but since I'm still building a base I haven't reached that point yet. If I do come up with some extra funds, I'll probably jump in near the end of November when another big dip should hit, and then hang on as some resurgence comes from December sales.

I'm going to go through some local newspapers again today in an attempt to find new investors. I'm staying away from the major local paper since that seems to have little returns. Hopefully I'll have some prospects to send this weeks leads out to.

Weekend Plans

Another trip to the courthouse today. Rounded up 10 leads for my basic location. That's about average, and from what I've read the foreclosure rate is only going to continue to go up. The greater problem of nothing actually being done with the leads still exists, but hopefully I will make some new contacts on Monday that I can funnel the leads out to.

I've been rereading The E-Myth Revisited, and I hope that once I get a steady amount of investors who are producing sales, then I can really put a system around my business. The training that I read for how to be a Jobber was essentially all the system I need, but I hope to automate the process more and eventually move myself to more of a supervisor role. Eventually I should be able to get jobbers underneath me to go to the courthouse or be doing driving trips to find leads. Also, I plan to setup a website. Then I could have jobbers log in and input the data online, only to have the system then send emails out to the investors based on some rules that I setup. But that's all in the future for now.

Stocks are having a terrible day for the second or third day in a row. It just reemphasizes how important getting my business to a productive level is. With the business I actually have some control over what happens rather than playing the role of the middle man, hoping that the unruly mob that is the market continues to push up in my favor. Stocks are a great and extremely passive source of income, but when you're trying to get to a substantial amount of wealth, they are very slow and unhelpful. Getting a strong business cash flow is really the best fuel for filling up your asset portfolio.

The car hunt is continuing this weekend. I may just settle and buy the car I test drove on Wednesday. It seems the most powerful tools available for negotiating the purchase of a used car are the ability to walk away and the ability to buy the car outright on the spot. I'm hoping to use them to knock $500-1000 off the price tag. I figure if I can get the car for about $5K, then it's really a steal. So we'll see how it works out.

I've begun filling out some business school applications. The essay seems to be the hardest part because it's hard to write to a target audience that you know nothing about. Write now I have some basic framework for the content and a mild attempt to string it together, but nothing that would amount to a full first draft. If I don't finish the applications before the spring semester deadline then I'm not really going to worry about it. Usually bigger classes start in the fall which might play better into my favor.

Don't forget - One Laptop Per Child starts their Buy 1 get 1 program starting 11/12. So enjoy your 11/11 holiday and help some kids on 11/12!

Stand Still

So I blew off the meeting on Saturday. My plans didn't work out as expected on Friday and I had my first basketball practice for the team I'm coaching on Saturday. So instead of getting up early and passing out poorly made business cards, I staid home and slept in.

Disappointed? Yeah, me too.

I'm not making any real strides in my business or in my hunt for a car or a house. I feel like I'm in a rut right now and have been for a while. Part of my thinks it all stems out of my dissatisfaction with my job, but it may be other things as well. This is usually the hardest time of the year for me since I fight against my SAD. Also, my computer crashed over the weekend, corrupting key files for the operating system to boot so I may have lost everything I've done since I upgraded my computer in February. Luckily, I copied my financial information over to my new (old) laptop, so that has remained intact.

I'm hoping that the reason my hard drive isn't being recognized is that the RAID drivers were corrupted and maybe if I reinstall them things will be ok. I've had a lot of problems in the past that ended poorly, so my hopes aren't very high at this point. At least I have a backup hard drive and I was able to access all the data from before February without any problems.

Normally when I run into a rut like I'm currently in, I put together some plan of action and try to push to make some changes. After that I'll get a few things done from the list and nothing big will change. So I guess I"m going to do it again. Here is my current situation:

I need a car.

I have a budget of about $8K setup to buy a new/used car. I'm looking for something mid sized that will get pretty good gas millage, has less than 60K miles and will last me for 5+ years. Right now, the make and model I'm targeting is a Chevy Malibu. I found a few online and I'm going to setup test drives for later in the week.

I need a new job.

While software development was fun to learn, I hate the environment and I don't like the subject matter enough to put outside time into learning more. Instead, I'd be happy to take a job with less pay in the finance field. I'm looking for a place that will pay for me to get an MBA and will give me an opportunity to actual use my skills. I think I'd like to work in a larger company rather than a smaller one.

I need a new place to live.

I have a down payment built up to about $10K, which is not that much. It will only be me living there, so I don't need a very large place, just something that I can exist in and potentially setup a small business operation.

So now I have to find a way to make this stuff happen.

Stalled Progress

Sadly, I haven't made any progress this week. I keep forgetting to look through the classified section of the newspaper for new investors. On the upside, I looked at some directions to get to the meeting on Saturday and it shouldn't be a problem. I have to work late today so that I'll have time to head into the other county on Friday. With my new (old) laptop, the lead collection time should be significantly less so I won't stay too late.

My stocks have been slowly inching up the last few days. Earnings reports for the most recent quarter are trickling in each day, and for the most part, they've been good enough to boost my overall performance. The trend for the US economy is down though, which could mean problems in the future. The Fed could lower interest rates today, which would boost stocks in the short run but probably hinder the economy in the long run. I'm shifting, not in the approach I take to screening stocks, but more in the approach of what markets my stocks target. I'm trying to pick up stocks that will benefit from foreign market growth rather than relying on the US economy. Everything seems to be pointing to this being a lean shopping year in the US during the Christmas season.

Today is Halloween and I'll be working most of it. So I open it up to the readers. Leave some comments about your favorite Halloween story or a great costume idea. Let's see if you guys can come up with something scarier than working late at the office.

More Questions than Answers

I'm really starting to dislike the "blogosphere".

At first I loved it. The almost constant flow of new information, pearls of wisdom on various subjects, advice advice and more advice! You start to think that if you read whatever people post each day, after a few months you'll be the best and most intelligent person you can be. But that's wrong, so so wrong.

First of all, most of the people writing blogs have no real idea what they're talking about. They've read a book or two (if you're lucky) on a subject and are just regurgitating what they read. Usually very little critical thinking has been applied and only some of the main points the original authors researched and tested are whittled away by the blog author's opinion.

Second, when you read something online that is written coherently and in a certain structure, your mind starts to trick itself into thinking that this is factual, indisputable information. I'm very doubtful that this is correct. The formats almost lull you into a state where your brain's natural pattern matching kicks in, separating key ideas from useless fluff based on pre-existing patterns that it's been trained to hunt out. Then the main ideas are digested, even if the whole thing was actually fluff.

Third, a large amount of blogs broken down into lists are just throwing extra points in to make the content look stronger. The first few points are well thought out and sometimes backed by actual statistical evidence, but the last few points are after thoughts, thrown down in a stream of conscious write out.

Fourth, once you've read enough blogs filled with advice on different subjects, not only does it all start to blend, but eventually it'll start to contradict other information. No longer will you end up on a default path to self improvement and greatness, but rather just confusion amongst mixed messages and opinions.

I'm going to take a moment here to point out the obvious irony. Yes, I know I do the same thing. Yes, I've been slowly trying to adapt these same formats. Yes, I'm trying to break my way into the blogosphere to collect a loyal following of readers. I have no defense for this. I'm doing exactly what a large number of other bloggers are doing. The main focus of my blog though, is a journal of my actual experiences as I try to build a Real Estate Investment business from nothing. So, anything along that thread is actual experience, not just my take on different ideas. I hope to gain credibility as my business takes root and grows, I don't demand it now or expect everything I write to be taken as gospel truth. I live with myself knowing that at least I'm making the effort to walk the walk that I talk.

On that note, here is a status update.

I sent out the leads from one courthouse to my investor on Friday. I included a note asking him to contact me so I knew he was still receiving them as well as letting me know what progress he's made. I received no reply.

At this point, I need a new investor. It would probably be best to collect a large number of investors and then see what ones actually pan out to some results. Last week I had found a potential ad in the paper but never called the person. This week I'm going to have to go hunting again and actually make calls towards whomever I find, if any at all. Also, I have setup plans to go to a REI meeting on Saturday, so I should be able to get some new investors from that.

I'm also working on putting together a template business cards. I'd also like to setup a couple of websites, one as my personal resume to track my work experience and developed skills, the other to start establishing more of a professional presence in the Real Estate industry. That will be my focus this week.

I hope that the people who read this get something out of it. My main goal from my writing is not just to entertain or spout off conjectured advice, but rather to inspire those who are in situations like my own to break free and do what they want. To focus their time outside of the job that they do to keep their standard quo and start building the future they want. Hopefully that idea will stick.

Weak Week

Courthouse

So I bailed on the second county today. I know, it's lame and I should have found a way to go. But I'm going to make some excuses instead.

I stayed up later than normal again last night. World Without End just has this power of sucking me in so that I keep reading, chapter after chapter, until it's late. I can't say I regret it because I'm too fascinated about what will happen next to care a lot about what's going on in my own life right now. Probably also because there isn't much going on in my actual life.

The courthouse I normally visit had about 10 leads today. I brought my new (old) laptop and used it. It was struggling because the battery doesn't hold charge very long, so I had to hunt around for an outlet. Also, the processor is pretty weak so Open Office did not open. I ended up typing the leads in notepad and then moving them to my Master Lead Log later.

I figure, since I'm not supremely confident in my investor right now and I don't have any others lined up, getting a lower amount of leads this week is not that big of a deal. Also, if he does get my emails, maybe he'll notice the lower amount and contact me back. That would be nice, since then I would know he's actually doing something still. I'm planning on going to the REI meeting I mentioned previously next Saturday regardless of his status. At this point I need to really focus on actually creating something out of this.

November

For some reason I'm really looking forward to the beginning of November. I can't put my finger on why, but I almost feel like something is going to change. It might end up being as little as me flipping the page in my calendar, but any change would be nice at this point.

I go to a chiropractor 3 days a week. My medical insurance covers the whole bill and back in July I figured, why not? I had been having some back pain and people had recommended it. The pain is gone at this point, but this process called "traction" that I do to correct the angle of my spine leaves me aching. I think that's part of the reason why I'm so tired. In November we'll be done the second stage of the treatment process and maybe I won't have to go as frequently. Going three times a week forces me into a pretty tight routine, esp with when I get to and leave work.

I'm thinking about getting season tickets for my local NBA team this year. It's $600 per seat for the season, which isn't bad considering the high part of the range is $32,000 a seat. My thinking is that when you have something other people don't, it can be used as an asset. If I get two seats, I can always try to sell the second one or both if I don't want to go to the game. If I do want to go, I can call up a friend and ask them if they want to go, so it's a way to reconnect. The final benefit is that I can give the second seat ticket away as a gift for different occasions, like birthdays or graduations. My brother-in-law has the local NFL team's season tickets and he does essentially that. Every year he seems to get his money worth, so I think it'll be worth it. I've built up all the money I need to purchase a car outright, so I feel like this is a good way to reward myself and make my life a little more enjoyable.

That's all I've got for today.

A New Week

Last week's expeditions went very well. I was able to collect 93 leads for the week and send them off to my investor. Sadly, I still haven't heard anything back from him, which, along with a total lack of production, has made me lose all the faith I had in him. So I think I'm going to go back to the drawing boards and try to collect a bunch of new investors. Specifically, I'm going to target ones that deal exclusively or mainly in foreclosures, since they should be up to date with all the laws and capable of actually making deals happen. I figure, if I'm going to have the production like I had last week, I need to actually start capitalizing.

Today has been pretty depressing outside of potential business success. The stock market is taking a beating and there seems to be large amounts of talk about a recession. I've built my portfolio around some international stocks or at least ones that should benefit from international markets, but it seems that when the US isn't doing well, there is almost a gloom around the whole market.

The other thing I'm frustrated about is the lack of returns on my money. At this point I've built up a pretty solid stockpile of capital, but it's growing so slowly that it might as well be sitting forgotten in the bank. This, along with this book I'm reading, has me thinking about the "class system" that exists even today.

The Class System

Way back, there was a clear separation between nobility, middle class, and poor. The nobility were the lords of the land, who didn't do any of the work but rather played on people's fear of God and lack of education to get them to follow them without question, working their land and paying taxes to them for the privilege. The middle class would work through apprenticeships for years, slowly learning and practicing a skill, until they became a master themselves with their own business. Then, based on the type of work they did, their trade pretty much determining their income level and social standing. The poor, with little or no education, did the manual labor that was needed to supply the goods and food for society. I think that, while slightly different in form, the system still exists today.

The poor nowadays are those who are right at or around the poverty line. Maybe they don't have a college degree or maybe they just don't care about the quality of their work, but they sit at minimum wage or so, barely able to get by. The middle class are educated, usually with degrees, but end up working for companies, doing skilled labor but not having any real holdings in the assets that they are building. Content with their paycheck, they live through there days keeping up with the status quo and being entertained by sports and TV.

Todays nobility are the business owners. Those who, through whatever means, own the company they work at, or a large apartment or office building that generates revenue for them with little actual work needing to be done. They employ the poor and the middle class and keep them content with benefits and slow pay raises. Meanwhile, they're paying less tax and pulling in money just because they are willing to go outside the main society lines and do things differently.

Great, so now what?

So, the real question in all of this is, how do you cross the lines up the class system? I've struggled with this one for a while. I have I read numerous books, learned about many investment tools and had many conversations with various people of different social standing. There is only one way to do it.

People are a product of their habits and their environment. If you want to change where you are and who you are, you have to change who you spend your time with, what habits you foster and what thinking process you support. The three classes just think and do fundamentally different things. If you are always around people who think like you, you will continue to do things the way you do. If you have problems, you'll ask your close friends for help and they'll give you the solutions that will keep you where you started. The only way to break free is to change all of that.

It's not an easy path. Hard work and persistence are the habits of the rich and powerful. By the time they've reached a certain status that you are aware of who they are, they have already done the hardest parts. You see the end result, the wealth, the freedom, but all the extra effort and behind the scenes work that it took to get there is gone from view.

So don't be fooled. If you want to change, do it, be bold. Step outside the box, find those who want to help you and see you succeed, help them as they help you. For the rest, leave them behind and move on. You can't help them by lagging behind and trying to hold their hand. Be a beacon of success for them by being a success yourself.

Jackpot

I took off work today and headed to the courthouse. The one I normally go to had 9 new leads for today, which is below average but still beat last week. Then I headed to a nearby county to see if it would be a good idea to expand my route. Turns out that there were 40 leads in that county. I had to pay $17 for parking and it's a little out there, so it'll be a challenge to add it to my weekly routine without taking a day off each week. But it seems that figuring out some way of doing it will be worth the effort.

So I wrote up the leads and sent them to my investor. With 49 or so leads per week, I'm looking at what should average 2 purchases per month. That's a lot better statistic than previously. I imagine that it'll take a while for a pipeline to be built up with a good amount of purchases coming in each month, but this definitely makes things seem more promising.

The rest of the day was pretty productive as well. I had time to watch my brother's soccer game as well as hit the gym. I've been sick for the past 2-3 weeks with an annoying post nasal drip so I had been ditching the gym in hopes of helping recovery. I figured I'd go anyway today, and thinking about it now, it might help me push through this. Regardless, it felt good to get in a work out.

I also updated the breakdown of my finances. Interestingly enough, my savings are still 60% of my net worth, my liquid amount is up to 12% and my investment percentage is up a percent to 28%. My net worth went up a good chunk in the last two weeks overall, so while the balance isn't exactly how I'd like it to be, it's still an improvement.

Alright, that's all I've got for today.

Engineering Business

I had a revelation a few days back about business. I believe one of the main reasons a business will fail is because the person running the business treats it more like a hobby than a business. What I mean by this, is that in order to succeed there has to be metrics to track where you've been, where you are and where you are going. If you only focus on doing what you've always done, or just whatever task is at hand and leave out this perspective you lose your propensity towards growth and it becomes more of a job than a business.

I read somewhere recently about this kid in a third world country. He spends his day begging on the side of a popular road. What's special about him is that he varies what he says, how he says it, his body position and various other factors for each situation. He then keeps statistics of the results in order to determine what combinations work best for what types of tourists or other people that pass by. Now that is using an engineering approach to business.

My current favorite TV show is House. The reason I love it is because, unlike how I envision most doctors, he takes an engineering approach to diagnostics. He creates a list of symptoms, determines treatment and proceeds. If the output does not match what he expects, he now has another symptom to use to analyze the problem and determine a new diagnosis. The beauty of this is that he is able to remove all the clutter of potential traps towards figuring out what is wrong with the patient, including emotional attachment.

Now, keeping this in mind, I've been analyzing my own business.

Since starting going to get leads, the weekly numbers have been as follows:

8/24 - 15 leads
8/31 - 21 leads
9/14 - 19 leads
9/21 - 10 leads
9/28 - 6 leads
10/5 - 8 leads
* 9/14's results are slightly skewed since they include 9/7's results as well.

So I'm averaging a little over 11 leads per week. Since usually you will get positive results from 1 out of every 100 leads, this means that every 10 weeks I should get 1 commission. So, maybe between $500-$3000 ever 2.5 months, or an average of $200-1200 a month, with a start delay of 3 months.

Based on this, I think my conclusion to start going to other counties in order to pull in a larger amount of leads is a good idea. Also, I need to start determining other potential sources for leads, such as houses with tax liens or code violations as well as just the foreclosures. Once I've developed a healthier flow of leads, hopefully in the range of at least 25 per week, then I can do some analysis of my investor to see how good or bad he is versus the average 1 connection for every 100 leads.

Clearly though, these statistics point out how great a need I have to increase the number of leads I find and move my pursuits forward to the next step.

The other important thing in business that ties in well with statistics, is goal setting. My current goal is to expand my operation this week by visiting courthouses in other counties. This will give me some familiarity with their locations, best routes to get there, amount of time it will take to visit them, as well as how much potential they have for leads. Then with this information, I can start finding ways to incorporate visits in my weekly routine. The goal being to hopefully double or triple my flow of leads. I'd like to get my average up from 11 to at least 25 by the end of the month by incorporating these new methods.

Now with some stats and goals, I'm hoping to move this business to the next level and actually start seeing some strong results. Then I'll be able to keep pushing for more growth by doing more statistical analysis and setting new goals.

Courthouse Sum Up

Courthouse results for this week were only slightly better than last week. Eight new listings for the county. In doing some checking, it seems that Monday will be a holiday for the courthouses and they will be closed. What I might do, is go to work on Monday and then take the holiday on Wednesday or Thursday since it's an optional holiday that I can move around. I'll have to see how I'm feeling on Monday.

Recently, the subject of retirement and investing has come up a lot in what I read and conversations I've had. A friend of mine said that his Financial advisor told him that with some smart planning he would be able to retire by the age of 50. This shocked me because the guy is an engineer, is already buying his own house and is putting money away towards retirement. You'd think he would be farther ahead than just 5 years. Apparently justification for only 5 years is based on theoretical expenses for children and some emergency funds in case something else comes up. I still think he should be much farther ahead than that.

Personally, I have three accounts setup for retirement saving. First is my 401k through my company. I have this balanced pretty well in some mutual funds that will avoid a lot of current USA domestic problems caused by the credit crunch going forward. My rate of return for the year is only 3% in this account, mainly because I set it up at the start of June and it got whacked pretty hard by the dip in the market before I did some more research and setup a better selection. Ever since I rebalanced I've been charging back and I plan on leaving this alone and letting it grow for the remainder of the year. The combination of not having to pay tax on what is put in and my employer matching really helps this grow.

I also have another 401k from a previous company that is averaging about 9% return so far this year. If last year is any view of how the last quarter will turn out, I should end up with about a 15% return for this year.

My second account is a Roth IRA that I setup last year. It's focused on some foreign markets that are mainly revolved around gold mining. It's been averaging 11% growth per year, so it seems fine to leave alone. I'm not sure how high the management fees are, but it's more of a bonus fund so I'm not tinkering with it much. I realize I can't touch this money till I'm 65, but not having to pay taxes on earnings is worth it since it's a solid long term setup.

My third account is my individually selected stocks. I'm taking the value investing approach and following the system of Joel Greenblatt, the investment stud who has averaged insane returns over the last 25 years. This is my pride and joy account that I've been priming for almost a year now. I've heard a lot of people talk about their failures in picking individual stocks, but I believe in value investing and I'm dedicated to sticking this out, esp since it's already produced 10% gains even during the dry period of the market and should really excel during the upcoming months.

The combination of those three accounts are the backbone of my retirement savings plan. My current goal is to prime them and let them compound over the next 20-30 years. The result should easily leave me in a comfortable position to decide if I really want to keep working long before the retirement age.

Like I stated previously, I'm trying to move away from saving now that I've setup the backbone. The greatest and worst thing that stocks have going for them is that they are so passive. While I don't have to do any work to see change, I also have no control over that change after the initial buy decision. I'd like to shift my money flow into priming other things that I have control over into a larger state of growth. The best example is the Jobber business I'm building. Eventually I would like to significantly increase operations by purchasing a laptop to use to collect lead information as well as start using some paid sources to acquire leads. At that point I will increase the number of investors I work with as well as pay to join some local REI clubs. But again, this growth hinges on some capital investment. But the nice part is that I have direct control over the results.

The final thing I want to mention is the use of mutual funds. My guess is that a large number of "investors" throw their money into a mutual fund and then go on with the assumption that someone's active management of that fund will lead to their profit. I'm warning that this is not the case.

Mutual fund management is a job like any other, and with any job there is always a range of how good or bad the person doing it actually performs. Just because they hold that position does not mean that they are really more educated about the market than you are. They most likely are just following a corporate system that does not take into account any of the real factors that determines how a business will perform. Warren Buffett follows the value investing approach of determining the actual value of a company and its shares. He takes it a step further than just that, though. He looks at the management and decision making and sees if they are intelligently directing the business.

I read the book Good to Great a year or so back. This book was a brilliant analysis of what are the differences between a company destined for success and one that will walk the average line. They are real, they are true and they are greatly overlooked. Never forget that what you are investing in is not just a name, it is a business. A business is only as strong and capable as the people who do the work.

Weekly Update

The courthouse was pretty disappointing today. Only 2 new listings for this week. I'll probably drop by again tomorrow since I'm taking the day off just to see if more pop up. I'm also going to try to visit another county's courthouse since I'll have the free time. If it goes well and I get a good feel for the lay of the land then I'll try to find a way to fit it into my weekly routine.

It's interesting to read about the various companies making plays in the market. Berkshire Hathaway just purchased 12-15% of two of these major railroad companies and are also rumored to be purchasing some of a hedge fund that took a huge hit from the sub prime market collapse. They're moving millions of dollars around like its a drop in the bucket. I suppose it is for them since their net worth is in the billions, but its just a hard concept to wrap your head around. When you compare conversations you have with people who would be happy for the rest of their lives with 3 million dollars, versus people who throws hundreds of millions around, its just a monumental context change. If you've got hundreds of millions of dollars then $10 for lunch really isn't a big deal anymore.

I finished the fight yesterday, which is why I'm having trouble writing and focusing today. Staying up a little late and waking up early to go to the courthouse is a dangerous combination. Luckily I'm done for the week after today so I'll have some time to recover.

I've been doing some work to try and make this blog more popular. I'm not sure what people want to read though, so if there are any topics or ideas someone reading this would like to hear my opion on or discuss, please feel free to email me or leave some comments.

Weekend Digest

I got a call from the investor I'm working with over the weekend. He had some questions about the leads I sent him. I think it was too late for some of the ones that I had gathered a few weeks before sending out. I told him the ones for this week were all relatively new and should not have gone to court yet. So, hopefully he'll have better luck with this attempt.

His call restored some of my confidence in him. Although, him actually being able to lock in a deal would really make me confident. I'm still pretty early on in this business at this point so I'm not trying to get my expectations up. I would like to expand some and start checking some other nearby county courthouses for leads. I'd also like to purchase a laptop to use for recording the leads and managing business documents. The biggest problem is that the courthouses are all open from 8:30-4:30pm, so I can't really get to them during the work week unless I get up early and get into work late.

I feel like the 12-15 leads I average per week is good enough for one investor. I would like to expand to more than one investor and get another lead source going in order to pick up the pace. I was thinking about recruiting my brother but, I reconsidered due to results of past business ventures I've attempted with him. Some of the advice I've read also says it may not be a good idea to work with family members, and in this case I think they are right. It's harder to establish a chain of command with family, esp if they are older than you.

If I get a laptop, I also might be able to start doing some work from home. I don't really need to laptop in order to do it, but I feel like it would help me keep everything separate. If I work from home the commute time I would normally spend going to work can be exchanged to a trip to the courthouse and then I can still work the same amount of time. So I'll be mulling over ways to work that out.

I was doing some reading last week of this book that discusses how to write winning business plans. The key focus they discussed in the section I read was defining your "Mission Statement". My first instinct, to make money, they didn't seem to like. Apparently you need a stronger reason than making money in order for a business to survive. How about, to not have to work for someone else? How about, to retire young? How about, because I hate my current job? I'm not sure if any of them work either.

I think the biggest problem I'm running into is the same problem I've had all along. I can not seem to convert my business pursuits into something that pulls in money. Each one I've tried has yet to actually generate any money. The closest I came to was the Quixtar business, but all I got was this $10 check that I ended up not even putting into my account. I felt like it would be stupid to, since I ended up being given the money under shady circumstances (part of the reason I bailed on the Quixtar business). I need to find a way to take my talents and efforts and convert them into a measurable and sustainable source of income. I was hoping this blog would start generating something, but so far my total from Google Adsense is 8 cents. I don't think they send you the money until it gets above the cost of a stamp at least. Again, it's still early though.

Well, this is a short week at least because I'm planning on heading out to IL for the weekend. So at this point I'm close to 25% of the way through to the weekend.

Back in Action

So, I've been out at a training class for a week so I haven't been updating at all. A lot has happened since my last post on many fronts.

First off, I managed to do my weekly trip to the courthouse last Friday. Picked up a pretty substantial amount of leads since it had been two weeks since my last visit. This was great since I took the big plunge earlier in the week. I got over my qualms and made some calls to my potential investors. Some of them were duds, more real estate agents that weren't actually investors, but I found one who acts as a wholesaler. He is willing to split any sales profits with me 50/50, which was an unexpected but positive happenstance. So after I gathered my leads on Friday I emailed my collection to him. I didn't do the extra research this time since I'm not sure what information he wants. It seems the approach he takes is to send out letters to people and then work with whomever contacts him. I'm not sure if anything will come of this yet, but it's a nice feeling to think that there is a potential out there for my efforts to come to a profitable conclusion.

I ran into an older guy named Jim at the courthouse while I was there on Friday. He was looking at the foreclosures as well and does his own wholesaling thing. Apparently he normally goes to the courthouse near where he lives in Annapolis and every so often will make the trip out to Howard county. He gave me some advice about joining an REI and to hang in there and stick with it. I should have asked him more questions, but running into him caught me off guard. Maybe I'll run into him again, so we'll see.

I had not given any thought to going to other courthouses. The investor I talked to said that he use to go to the one in Baltimore and would get hundreds of hits each time. I'm not sure the frequency he went, but the idea sounds pretty good.

My current plan is to procure a laptop, which will greatly increase the speed I can copy down lead information, and then maybe try to find ways to hit up the other courthouses. It's hard to fit in time to do it around work, since they are open during normal business hours only, which is the same time I'm required to be at work.

I'd like to start working at home more, since that would eliminate commute time and give me some more flexibility. There seems to be some snags and grumbling about my training from last week and what budget to charge it to, so I'm currently keeping a low profile until whatever details are causing problems get ironed out. I'm hoping after a few solid work days back at the office things will be closer to back to normal. I guess I'll just wait and see.

At this point I'm happy with my current progress. I'd like to contact some more investors, solidify the information for my leads and then start adding other lead sources for the future goals. I'd also like to expand my operation to more than just me. I realize having investors that provide the capital and finish the purchase process counts as more than just me, but since I don't have an opportunity to do much during normal business hours, I need to find someone who can.

I'm also done with the GMAT. My scores weren't as high as I wanted but I am proud of my writing score of 5.5/6. I need to being the process of putting together all the information I need to actually apply to the schools. Plus there is still the matter of how to pay for it. Now that I'm back at the grind I guess I have more time to look into that.

Long Short Week

Despite having Monday off for the holiday and it being only Thursday, this has been a long week. I did not reach my goals for last week again. I keep hesitating on calling investors and trying to actually setup a pipeline of moving leads. I don't know why I hesitate, maybe it's just a wall I have to break through, maybe it's my own laziness.

Things are picking up and running wild at work. I went from not having enough to do to having too much to do. I'm balancing between multiple projects with multiple assignments. Plus, neither set of managers seems to know that I'm taking some online training and then going onsite for training next week to become a Remedy Administrator. I thought I had rapped up all these tasks I needed to finish so that I could focus, but other people have other ideas.

Also, this is the final week before I take the GMATs on Saturday. I feel relatively prepared but I wanted to run through practice exams each day this week. This has not happened at all. Usually when I get home I'm so worn out that I end up playing video games and watching tv and then my whole evening is shot. With two nights left, I need to make some big mental pushes to stay on task and really focus.

I stopped by my old job location on Monday and chatted with a friend of mine that still works there. He had mentioned to me a while back about how I have a tendency to get pulled into too many projects at once, and then lose focus and ending up spread too thin to make any progress. I've noticed this trend as well. Usually when I am spread that thin, the lack of progress frustrates me and I give up on everything. I've found that if I have too little to do I get bored and just put off doing anything. So it's very hard to maintain that certain perfect balance.

Yesterday at work this guy was blaming me for a lot of problems that were occurring with this one task. That guy was the one who wrote all the code that created the problem, plus never provided any clear requirements for what he wanted. Situations like that, where you are setup for failure or blamed for something you aren't responsible for, really bother me. This guy I use to work with did that all the time. He would say, "I don't micro-manage", but in reality he just had no idea what he was doing and would just give vague directions without much substance. Then when everything inevitably went wrong, he dumped all the responsibility on you. If things did go well, due to your personal heroic efforts, then it was good job but he got the credit. Which made it a lose situation to work with him at all. Eventually I just stopped talking to him and helping him at all until I left the company.

Theoretically, I will be spending the next two weeks at these training sessions to become a Remedy Administrator. Then I'll start being sent on travel to do installations and setups. If that does happen, this will be the first time I've ever really been sent to training for a task before doing it and might actually feel adequately prepared. Although, since you're actually suppose to have 1-2 years of Administrator experience before doing the third level training, it will probably be tough to absorb all the information and then be able to act on it. I guess I'll have to wait and see.

I shouldn't have stayed up so late last night watching the Fed/Arod match. It was worth it to see the dominance, but I am going to be tired all day now.

Weekly Courthouse Visit

So today is Friday. I got up early and headed over to the courthouse before work. Ended up with 21 hits today. I'm not sure if that's really more than last week or not because last week I ended up stopping before getting to the end of the list so I wouldn't end up too late for work. This week I knew what I was doing so I got in, got what I needed and got out pretty quick. I did not end up looking up other types of leads other than foreclosures, but I will eventually.

I also setup a spreadsheet this week to help better organize the leads I've collected. I have papers where I wrote out all the original data still, but I feel like having it in digital form will be very helpful. Once I get a laptop I'll be able to enter and keep track of this information a lot easier. I would like to actually generate some kind of income before I make any business purchases though.

In order to continue to get closer to actually making some money, I filled out a contact form for one of the investors websites that I had found previously. They offer $3000 for a lead that ends up in a sale, so that would be a great payday. That's 3x as much as the REJ course talks about asking for a qualified lead, and these people only want some basic information about the potential property. So I'll have to wait and see how that goes.

It would be great leaps and bounds to get to a point where I feel like I can generate income outside of the normal work groove. Once I make that real connection then I should be able to start coming up with more ideas on how to generate money as well as fine tune the avenues I get to work. Back when I was doing a Quixtar business they did send me one check for something like $10. I didn't deposit it though because I felt like something was wrong. Normally they don't send you a check if you only purchase goods yourself, but my "mentor" did some shady dealing or something. I was really turned off to the whole thing and didn't want to start off on the wrong foot. I didn't like a lot of the things this guy was doing and that's what eventually pushed me to stop going to meetings or putting any effort into it.

I've been reading this guys blog (http://geniustypes.com/) where he (or I assume it's a he, might be a she), discussed different types of passive income as well as how passive they really are. It's really insightful and I feel somewhat like we are working towards the same goals. It's nice to feel like there is someone out there working with you, unlike the people I am use to who are sitting on the sidelines waiting to see if I succeed before offering any help.

I was talking with a coworker at lunch about potential business plans in the future. He was saying how no matter what you do there is a level of hard work you put into it. We always see the rewards people receive in society and think of them as gifts or just luck. The reality is that they worked hard to get themselves to the point where they could succeed, where they were in the right place at the right time. My Dad always says to get invested in what you are doing, become the go to guy, put in the work. I guess in a lot of ways I've been looking for an easy way out. I should really just be looking for what makes me happy, what gives me a sense of enjoyment and satisfaction.

My coworker also mentioned "The Art of the Start" by Guy Kawasaki. I'm going to look into that and potentially start reading through it. It sounds like a very positive and perspective changing book.

Scrolls and the Daily Grind

So tomorrow I will partake in my now weekly ritual of heading to the courthouse. I imagine there will only be a few new leads there, but it'll be worth it. I feel like going somewhere and doing something makes my business feel more real. Although, I am still having trouble with the concept of creating an income, rather than just putting in hours and working for one.

I think its because I look too intently at the current rather than seeing the long term potential. I get so stuck on trying to do something quickly because I want my current situation to change. I'm not sure exactly what is the cause of that, my best guess is because I still live at home.

Today was the start of my last scroll. In January I started reading the book "The Greatest Salesman in the World". It is a great story that contains 10 scrolls of wisdom in it. The first one outlines the process, which is just that you read the scroll in the morning, afternoon and out load in the evening for 30 days so that its message becomes a habit. In truth, I only read the scroll in the morning and outloud at night everyday. But I am finally on the 10th scroll after sitting on the other 8 habit scrolls for 30 days each. I bought the sequel book months ago, so once I'm done this scroll I can move onto reading that. I'm hoping it doesn't have the same kind of format though, since reading these scrolls everyday has become burdensome.

Sadly, I feel like I haven't really developed any of the habits it promotes. I was excited when I first started, and I really tried. The problem is the same as the problem I ran into with the Rich Dad coaching. You have to change how you think, but you also have to change who you spend your time with as well, otherwise you won't end up doing anything different. They give the example of crabs that, once you catch two, will remain in a small container. Even though they could climb out, once one starts to, the other one will pull it back. That's how I feel. Whenever I try to start changing the way I do something, my family routine and mentality pulls me back down.

If I bring this up to any of them they get insulted. I tried to explain it to my mom again this morning but she always get defensive. Then she proceeds to the "I'm doing what I want to be doing" and "you just need to get your head on straight" habitual defense. Then she starts with the guilt of "not appreciating what you have". After a while I've gotten extremely tired of having the same arguments. The problem is that I like to talk out my ideas, and while I live at home the people I talk them out to will always be the same and they will always say the same things.

Well, aside from all that, the routine marches onward. I started to reread "Never Eat Alone", the modern day "How to Win friends and Influence People". I almost feel like its a spit in the face. Clearly the author has had a lot of success, but he also has a different background and situation. His parents made large sacrifices to push him forward, plus they have personalities that support him and encourage him, instead of always thinking in conflict and promoting their own visions of success onto their child. Also, at this point I've been working towards some specific goals for years, it would be a huge waste to do something rash and throw it all away.

The other problem with a lot of these books is that they exist in their own time. They just jump over the hard parts and talk about the rewards. Positive change and success is a byproduct of habitual action over a long period of time. It's hard to do the day to day things and make those sacrifices with only the promise of rewards in the future, esp with the future always in uncertainty. Sure you should find ways to enjoy the present, but that isn't always possible when you get crushed by the quagmire of the normal routine. It seems so pointless to have daily time commitments just for the sake of having them, without any freedom to use that time towards something productive that would require being at another location.

I guess my frustrations really just come from a few specific sources. Clearly I have a conflicting fundamental viewpoint with my parents, and while I live at home this is a constant source of aggravation. Also, I am unhappy with what I do at my job since most of the time I feel like I am trapped at a location, forced to pretend like I am doing something productive when I have nothing productive to do and see little opportunity to find something. I guess that just leads to a continuing cycle of feeling like my talents and abilities go to waste as I sit in a constant state of on call.

I don't have much of a resolution to end with today. I'm just kinda tired and frustrated, trying to push forward to the holiday weekend ahead.

School Year

So, again I fall short on my goals from last week. I did get the number of leads I was aiming for (and more), but I did not get the surrounding information and put them in my Master Lead Log. Also, I failed to contact potential investors to establish a path for my leads to go so that they can actually do me some good.

I need to get back on track. Or rather, on track in the first place. Recently I've been getting tied up in other stuff instead of focusing on what I should be doing. I've played through Final Fantasy Mystic Quest and half of Ogre Battle, and yet I'm still at the very early stages of getting this business going. I guess the 'procrastination bug' has really got me.

Well the goal for this week is to actually contact some investors. I should contact all the ones I've found, as well as continue to check the newspaper for new ones until I have a large pool. Also, I'm going to duck over to the courthouse before work again on Friday and try to pull in some more leads. In the mean time I should read the REJ course information again and get prepared. This should help me branch out from just foreclosure leads. The hope then will be to learn of potential areas to look for leads in drive bys that I can start doing on the weekend.

There has been some good news recently. On Saturday I did my first full run through of the GMAT exam in preparation for taking the test on September 8th. I did ok, ending up with 9 wrong on the verbal and 9 wrong on the math. Almost all of my verbal errors were in sentence completion questions and almost all my math errors were in data sufficiency questions. This gives me an idea of how better to focus in the future to improve my score. I did some reading during lunch today of strategies for these sections that were helpful. This weekend I will see if I can find more practice books at the library when I go to take another practice test.

Things are slowly improving at work as well. I'll eventually be signed up for these training classes that will teach me how to be a Remedy Admin. Once I've gone through them, I can start traveling to different government facilities and doing installs. I'm looking forward to some travel since I've only actually been to handful or so places around the country, let alone very limited foreign travel.

I'm curious if anyone actually reads any of this stuff that I write. If I do have any readers I'd love some feedback or potential suggestions/viewpoints. Let me know.