General

Internet Financial Guru

Where Are All The Internet Financial Gurus?

Money Maroon

It is interesting, and most likely you have also noticed. During boom periods, there tends to be a lot more noise from internet financial gurus. It could be a matter of folks being willing to share their experiences as the market booms. More specifically, there is typically a weekly or almost daily update about individual net worth. But what happens when the stock market begins to go south? Most, will stop sharing. A lot of internet financial gurus become very quiet. No one likes to share that they are losing money and if they are following their own advice, they are. But that is the big question, are internet financial gurus following their own advice?

Financial Gurus

During boom times, it is very easy to say keep buying, or buy the dip. But when the market is heading into recession territory, this becomes very difficult. Right or wrong, the more you buy the more you are losing in the short term as the stock market goes into the red. Also, the dip keeps getting dippier. So this is a very difficult message. As such, many internet financial gurus will stay quiet during these times, even if they are following their own advice.

Look At Your Statements

As the stock market goes south, are you looking at your account statements? It is interesting that as soon as we get wind of the stock market going down, we begin to develop this ability to not check our accounts. Do check your accounts. This is not to provide a reason to sell, but it is important to know what is going on in your accounts. Do not be afraid to look at your loses on paper. The stock market goes up and it will go down, and it will go up again. 

The same messages that financial gurus disclose during boom times are also applicable during a recession. If the information was true/false then, it is true/false during a recession as well.

Do Not Buy Individual Stocks, Buy Index Funds

As we have discussed before, a monkey can be a better stock picker than a human. So it is advisable, unless you are Warren Buffet, buy index funds. But when the stock market is going down, it can be difficult to stick to this strategy. But a clever man once said to be fearful when others are greedy, and greedy when others are fearful.

Stick to your strategy but use the market conditions, information, and your own situation to adjust your strategy. A stock market down turn does not mean that you should abandon your current strategy. In effect, if you truly believe in what you are doing, continue to do it and modify as information changes. This is also a matter of doing your research before you implement any strategy such that you are able to plan ahead and handle different situations. 

Recessions Are Filled With Opportunity 

As the past has shown, recessions are filled with opportunities. If you are in a stable financial position, you have no doubt pay down debt and has bulked up your assets. These are two basic steps that will prepare you  for a recession. Especially if you are in a high interest rate environment. More specifically, because banks will quickly raise interest rates on credit instruments, do not maintain balances if at all possible. If you have low to no debt, this is not something that you will have to worry about. Again, many of the statements made by financial gurus during boom time may be applicable as a recession approaches. Save, pay down debt, invest. This works no matter how good or bad the stock market is doing.

Cash Is King

If there is a recession and people are losing their jobs, having cash on hand is one way to ensure that you will be able to navigate such a situation for a year or two. Another advantage of having funds in the bank during a recession is the increased interest rates of online banks as the stock market falls.  During such a time, interest rates are typically increased.

There are many lesson to learn from recessions. If you are fortunate enough to still have your job during a recession, where you are consistently bringing in money, continue to save and invest. Avoid trying to time the market, because guess what, you likely cannot. Many have tired and have failed. Instead, consider dollar cost averaging and ride out the recession. No matter the economic condition, continue your journey to financial independence.

Conclusion

During boom periods, there tends to be a lot more noise from internet financial gurus. It could be a matter of folks being willing to share their experiences as the market booms. More specifically, there is typically a weekly or almost daily update about individual net worth. But what happens when the stock market begins to go south? Most, will stop sharing. A lot of internet financial gurus become very quiet. No one likes to share that they are losing money. But no matter the economic condition, continue on your path to financial independence no matter the rate of chatter.

praying for student loan forgiveness

Is Student Loan Forgiveness Fair?

Money Maroon

It does not matter how much is forgiven and it really does not matter the reason. Forgiving student loans is a divisive issue. There is one main group that will directly benefit from student loan forgiveness. This group includes those for whom student loans are forgiven. On the other hand, there will aways be a number of groups that will be aggrieved. This group of the aggrieved includes at least those who have paid off their student loans, those who never took out student loans and those who did not have the opportunity to take out student loans because they did not attend college.

Student Loan Forgiveness

There is a student loan problem. Some students were victims of predatory lending from opportunist institutions. In some cases, students were given loans and then obtained worthless degrees. In some cases, the institutions were not up to par academically. For some, the college was closed down and students were stuck with student loans but no degree. For others, student loan terms were not clearly explained and students now owe more than they borrowed. In all cases, for those affected, it is likely that they are stuck with a mountain of student loans and no true path to ever pay off the borrowed amount plus the accruing interest.

On balance, should these students have done their due diligence? Should these students have read the fine print and better understood what they were signing up for? Also, should there have been more government oversight to prevent institutions from selling these subprime student loans to vulnerable students? Something to think about.

Students Who Paid Back Their Student Loans

There are some students and adults who have now paid back their student loans. Essentially, they made it a priority to not take out more than they needed during their school years. Many of these individuals did not attend their dream school because of the cost. Instead, they settled for a less expensive option. They may have also worked extra jobs. Some did not take fancy spring break trips while in college. Others have forgone buying nicer homes or cars. Instead of spending, these students were cost conscious. They buckled down and payed back their student loans.

How would you feel if you were one of these students when you hear of others getting student loan forgiveness? You will likely feel robbed. You have made the sacrifices and paid back what you owed. Now, you are being penalized for your diligence, being proactive and responsible. Would you view this a being fair?

Students Who Did Not Take Out Student Loans

Let’s face it, we live in an unequal society. There are a group of students who attended college and did not have the need to take out student loans. This could have been a result of their parents saving over time and allocating funds specifically for college. For others, their parents were in the position to pay their tuition as they went through college. Still, there are many who simply worked during college and were able to make enough to pay their costs or obtained scholarships.

For those who prepaid for college, those who worked multiple jobs to pay their tuition, and those who studied and obtained scholarships, how is student loan forgiveness viewed? Will they view student loan forgiveness as a penalty? Why work hard during college and forgo all the parties, why prepay for college, why work hard and obtain scholarships when the student loans will be forgiven anyway? 

Those Who Did Not Attend College

Of the groups that will likely view student loan forgiveness in a bad light, those who did not attend college will likely be the most upset. They are the most likely to be upset because as tax payers, they may view student loan forgiveness as paying for something they did not have the opportunity to part take in. These individuals are essentially paying for someone else’s college education or mistake. They may also see student loan forgiveness being applied to college educated citizens as causing a further divide between the have and the have nots. Some who will be helped by student loan forgiveness, where they attended reputable colleges, may end up earning more than those who did not attend college. So in effect, as a tax payer, those who did not attend college would be further subsidizing these individual’s lifestyle. For many, this will be viewed as being unfair. 

The Greater Good

No matter your stance on student loan forgiveness, one thing to consider in this student loan forgiveness debate is the greater good. Will forgiving a portion of student loans help the overall society in general terms. If citizens are not buried by student loan payments, will this translate into increase economic activity as more funds will be available to spend. If this works perfectly, all of society will benefit. However, will this affect personal responsibility and the motivation to live within ones means if there is a possibility that your debt will be forgiven?

Whatever the decision with regard to student loan forgiveness, one thing is for sure, the debate will continue.

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Video Summary

Crypto Crash

Crypto Crash 2022

Money Maroon

I typically do not talk much about crypto, but you cannot ignore the growth of crypto over the last few years. It is also difficult to ignore the volatility of the crypto market lately.  The volatility is so much so, that the dramatic downturn in crypto valuation are rising concerns of a total crypto crash. 

What Is Crypto

If you do not know what crypto is, here is a simplified definition. Crypto currencies are digital currencies that are not reliant on any central authority. Crypto essentially is a digital currency that is not backed by a government or bank. While crypto is designed to be outside of the traditional financial system, it can be affected by the system.

Crypto Crash

Over the last few months, the crypto crash has wiped out  an estimated $1.6 trillion. Coinbase has tanked in value. Bitcoin and Ether has also lost value. For the most part, much of the value gained over the last two years have disappeared. For example, Bitcoin has dipped below $28,000 after hitting a high of over $68,000. But one of the largest crash is that of TerraUSD.

TerraUSD

2022 has not been a great year for the stock market. The stock market has fallen, with some individual stocks dropping more than 70%. On the crypto side, one of the biggest losers in 2022 has been TerraUSD, one of the largest stablecoins. As a background, TerraUSD was intended to be pegged to the U.S dollar.  TerraUSD was backed by credible venture capital firms, but not backed by cash, treasuries or other traditional assets. The supposed stability of TerraUSD was derived from algorithms that linked its value to the cryptocurrency called Luna. 

The aim was to use algorithms to peg TerraUSD to the U.S dollar. Essentially, minting $1 of TerraUSD requires burning $1 worth of Luna and vice versa. So, as TerraUSD demand increase and its value goes above $1, to bring the value down, Luna would be exchanged for TerraUSD to increase TerraUSD’s supply to bringing the value down. The reverse would be used to increase TerraUSD’s value where low demand lowers its value. However, TerraUSD had a known issue, the possibility of a death spiral.

With large dumping of Luna on the market, Luna began to lose value as supply became inflated. This resulted in more Luna being minted for each TerraUSD burned. This in effect caused a death spiral effect on TerraUSD. As Luna’s value fell, investors panicked and sold off their tokens. This action further fueled the death spiral, until Luna went to $0 from a value of $116. It is estimated that this crash wiped out about $40 billion.

The Real World & Crypto

Just as the stock market is affected by the traditional financial system, so is the crypto market. The current crypto crash is part of a broader pullback from risky assets.  This pullback has been driven by rising interest rates and regulatory policies to tighten the monetary supply, inflation and economic uncertainty caused by Russia’s invasion of Ukraine. With interest rates rising, savings accounts are becoming more attractive to many. Many investors are taking profits and pulling money from the stock market and putting it where they can get predictable returns.

Additionally, as the stock market falls, some investors are liquidating crypto investments to meet other obligations. This all comes together to drive crypto prices lower which causes further panic in the crypto ecosystem. Another factor that is affecting the crypto ecosystem is the increase scrutiny being placed on crypto by governments around the world. There is more and more calls for increase regulation. 

Long Term View

As the crypto crash continues, it is expected that a lot of different crypto currencies will fail, while others will succeed. This is not the first time that crypto has fallen. Do not forget that in May 2021 to July 2021, crypto  also had extreme volatility where Bitcoin fell more than 45%. For those investing in crypto for the long term, massive price swings are expected.

Conclusion

As crypto continues to grow, it cannot be ignored. Whether you make crypto apart of your portfolio is a decision that you should not take lightly. As the crypto crash of 2022 rolls on, no matter the instrument, do not invest in things you do not understand, and invest only what you can afford to lose.

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Video Summary

I quit, quit your job

Quit Your Job And Get Another One

Money Maroon

As the great resignation has shown, it is ok to quit your job. Unsurprisingly, while some has stayed out of the labor market, many are quitting their jobs to get a new one. Some are moving laterally in the same position while others are getting higher positions. Some are getting better benefits or a better working culture. The move to another job is not really all that surprising because guess what,  people have bills to pay. If you are planning on quitting your job, do ensure that you are looking ahead and planning out what the future holds. For example, how will you support yourself?

Quit Your Job

In the United States, it is very easy to quit your job. Simply, say that you quit and do not return. That it is. It is customary to give a few weeks notice when you are quitting. But legally, you are really not requited to do so. This curtesy is such that you can wrap up your work or transfer your work to another colleague. Giving notice also provides your employer with some time to replace you. This is critical if you are an important member of the team. The curtesy also for the most part allows you to maintain certain relationships with work colleagues. Remember, do not burn bridges as you do not know where you will be in the future.

This works the other way as well. Most employment agreements in the United States are at will. As such, your employer can fire you anytime and the employee can quit anytime.

In other places such as Europe, quitting your job is really a few months in the working.  With strong worker protection laws, it may take a company 6 months or more to fire you, and maybe just as long for you to quit. 

When quitting your job, even if you have the most horrible boss, try your best not to completely nuke your bridges. Meaning, you may not like your boss, but there may be others at the company that you may want to maintain relationships with. Act accordingly.

Before You Quit

It may sound like a great idea to quit your job. Yes, you will finally stick it to your boss and leave. With a replacement not being able to fill your role, your hope is that they will recognize how under appreciated you were. But before you make that final decision, ensure that you have thought about what the future holds. It would be great if we could all quit our jobs and not work another day in our lives (financial independence). However, this is not usually possible. Typically, once you quit your job, you will need to find another one. The high of finally saying I quit can be easily overtaken by the fear and trauma of not being able to pay your bills and support your current standard of living.

It is advisable to find a job before you quit your job. It is much easier to find a job when you have a job. Further, because you do not need a job you can effectively ask for exactly what you want. Because you are not completely dependent on getting that new job. Essentially, you have options. So begin your job hunt early and ask for the salary and benefits that you want. The worst that a prospective employer can say is no.

Once you have lined up that new job, go ahead and quit, if this still is the correct decision. Of course, it is important to ensure that the new job is better that the old job. It is very difficult to make this assessment as you will likely be in the dark with regard to certain information about the new job. Is your new manager better than your old/current manager? Is the company’s culture better? What is your progression and development opportunities? There are a lot of unknowns and you must do as much research as possible. Information is the key here.

The Grass Is Not Always Greener

In your job hunt, if you happen to obtain an interview or is reached by a head hunter, do understand some very simple facts. It is in the head hunter’s best interest to get the role filled. As such, not all, but some head hunters will misrepresent the job. This is because once you begin to invest the time in the interview process and begin to picture yourself leaving your current role, it is a lot easier for you to move on.

Therefore, no matter what the situation, do not be afraid to ask the hard questions with regard to salary, benefits, environment, culture, promotion and what the future of the company is. Do your due diligence on the company. Do your due diligence on the role. If you are applying for a role that have high turnover, you may want to ask about this. Try to find who the last person that had the role and ask why did they leave. They will give you answers. Check and see if you know people who work at the company and ask them about the company. They typically do not lie. Get information and make an informed decision.

Know Why You Are Quitting

As the grass is not always greener, know why you are leaving your current job. Know what you and your family need to be happy. If it is culture, ensure that your new job has a better culture. If it is all about the money, ask for a higher salary. But ensure that you know why you are leaving and what your ultimate goals are.

Conclusion

As the great resignation has shown, it is ok to quit your job. While some has stayed out of the labor market, many are quitting their jobs to get a new one. The move to another job is not really all that surprising because guess what,  people have bills to pay. If you are planning on quitting your job, do ensure that you are looking ahead and planning out what the future holds. For example, how will you support yourself?

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Financial literacy

Financial Literacy Is Important

Money Maroon

Without a basic understanding of simple financial concepts, good luck. It will be almost impossible to achieve your financial objectives. Everyday we make decisions about banking, budgeting, saving, credit, debt, and investing. Financial literacy enables you to make informed financial decisions that will propel you toward financial stability and achieving your financial goals.

Financial Literacy

There is currently no one definition for financial literacy. However, generally, financial literacy is the ability to understand and use personal financial management, budgeting, and investing to your financial advantage.  Simply put, financial literacy is having the knowledge to know what to do in a financial sense. This does not necessarily mean that every financial decision will result in success. But over time, it is likely that you will improve your financial situation.

Why Is Financial Literacy Important

Financial literacy is important because it results in budgeting, being prepared for emergencies, and limiting debt. These are the financial forces that we deal with on a daily basis. But more importunely, the financial decisions we make today compounds. The decisions we make today are more important than ever because of the limited safety net available for retirement. 

Most pension plans have been replaced by 401Ks. Unlike pension plans, 401K plans leave the bulk of the decision making and planning to the employee. Without proper financial knowledge, many will be saddled with debt and be ill-prepared for retirement. 

Lack Of Financial Literacy Is Expensive

Not being financially literate is expensive. Some consequences of lacking financial literacy appears in everyday life. These consequences show themselves in increase costs that can be locked in for decades. For example, higher transaction fees, banking charges, higher interest rates on debt, and loses in the stock market. Financial ignorance also compounds as you will not understanding the concept of  compounding. Compounding in view of debt and also in view of income/interest. In a recent survey, it is estimated that financial illiteracy costed Americans about $353 Billion in 2021 alone. That is a crazy amount of money. That is a nontrivial amount of funds.

The Solution

The solution to lack of financial literacy is simple, educate yourself. It is to you and your family’s benefit to be financially literate. Financial decisions not only affect you, but also those around you. 

Financial education resources are available. Best of all, a lot of the information is free. You have this blog as an example and hundreds of others that you can subscribe to or follow. If you want to learn the thoughts of the biggest financial titans in the world today, just search for it. Financial literacy comes down to how important it is to you. Believe me, it should be at the top of your to do list.

For the same reasons why a coach is likely not the best player on a team, financial literacy alone will not be enough to win the financial game of life. Knowledge alone is not enough.

Financial Literacy Alone Is Not Enough

While financial literacy is important, it is not enough. To achieve your financial goals, you need a climate that facilitates wealth generation. This means that the country/jurisdiction that you are in has to facilitate wealth generation. You have to have access to tools and resources to build wealth.  For example, in starting a business,  you need to have/have access to capital, general money management, supply chain and transportation infrastructure. Financial literacy alone will not overcome infrastructure deficiencies.

Financial education is important, but you must also tackle your beliefs and attitude toward money. Having the financial knowledge alone will not change your attitude.

Additionally, having knowledge does not mean taking action. You, yes you have to take action. You have to put your plans in motion. Start today. Take action. Use money  as a tool and other resources around you to move toward your financial goals.

Conclusion

Everyday we make decisions about banking, budgeting, saving, credit, debt, and investing. Financial literacy enables you to make informed financial decisions that will propel you toward financial stability and achieving your financial goals.

Below, is the reproduced S&P Global FinLit Survey. Take the test. Answers are given below. Are you financially literate?

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Financial Literacy Test (S&P Global FinLit Survey)

RISK DIVERSIFICATION

  • 1. Suppose you have some money. Is it safer to put your money into one business or investment, or to put your money into multiple businesses or investments? 
    1. one business or investment; 
    2. multiple businesses or investments; 
    3. don’t know

INFLATION

  • 2. Suppose over the next 10 years the prices of the things you buy double. If your income also doubles, will you be able to buy less than you can buy today, the same as you can buy today, or more than you can buy today? 
    1. less; 
    2. the same; 
    3. more; 
    4. don’t know

NUMERACY (INTEREST)

  • 3. Suppose you need to borrow 100 US dollars. Which is the lower amount to pay back: 105 US dollars or 100 US dollars plus three percent? 
    1. 105 US dollars; 
    2. 100 US dollars plus three percent; 
    3. don’t know

COMPOUND INTEREST

  • 4. Suppose you put money in the bank for two years and the bank agrees to add 15 percent per year to your account. Will the bank add more money to your account the second year than it did the first year, or will it add the same amount of money both years? 
    1. more; 
    2. the same; 
    3. don’t know
  • 5. Suppose you had 100 US dollars in a savings account and the bank adds 10 percent per year to the account. How much money would you have in the account after five years if you did not remove any money from the account? 
    1. more than 150 dollars; 
    2. exactly 150 dollars; 
    3. less than 150 dollars; 
    4. don’t know.

A person is typically defined as financially literate when he or she correctly answers at least three out of the four financial concepts described above. What was your result?

Answers: 1(2), 2(2), 3(2), 4(1), 5(1).

Video Summary

Why Lottery Winners Go Broke

Why Lottery Winners Go Broke

Money Maroon

Ever since I understood the concept that buying a lottery ticket gives you the chance of winning millions, I wanted to win the lottery. As I got older, I realized that the probability of winning was extremely low, as such, I rarely ever play. When I do play, I see it as a donation to the State’s education system as a percentage of the lottery usually funds education. For the lucky few who plays and wins, congratulations. However, for winners there is happiness, that is typically followed by sorrow and many times tragedy. It makes you wonder, why does such tragedy follow many lottery winners? Looking at the financial side, why do lottery winners go broke?

Lottery Winners Go Broke Because Of Inexperience Money

A lot of lottery winners are not math or financial whiz. The fact is, the more educated you are, the less likely you are to play the lottery. It is simple, you understand that the odds of winning is extremely low and as such you do not play.

Those who win the lottery, tends to be those playing the lottery which is in effect proportionally not the most educated with regard to finances. Most lottery winners have the issue of having a large sum of money and not knowing how to maintain it. 

Many lottery winners fall prey to their wildest financial dreams. The dream of having one or more mac mansions, new expensive cars and other toys that are wanted but not needed. With a scarcity mentality, many lottery winners are frivolous with lottery winnings. Some winners see their winnings as “free money” to be spent. While individual purchases may not put a dent in the overall winnings, they can quickly add up if winners don’t keep a close eye on what they are spending. A bigger home comes with a bigger bill to upkeep. Luxury cars come with larger insurance and repair bills.

lottery check - why lottery winners go broke

The Payout Is Not As Much As You Think

When taking the payout from the lottery, winners usually have a choice. The choice is typically between taking a lump-sum or a fixed payment overtime. If you take the lump-sum, sometimes it is only around 60-75% of the advertised prize. This can leave winners with a lot less money than they expected. Then do not forget about the taxes. In most jurisdictions, lottery winnings are taxed. As such, in the end, while you will have a huge sum of money, the sum may not be as large as others think it is. Therefore, it may be bit more difficult to rebuff family and friends when they falsely believe that you have a lot more than you actually do.

Lottery Winners Go Broke Because Everyone Knows That You Won

In many places, a condition of winning the lottery is that your name is made public. Many lotteries do require that basic information about winners are made public. For example, name, city and the amount won.

When every one knows that you won millions of dollars, you will have long lost friends and family coming out of the woodwork. They will all come calling.  Many new lottery winners will not be well equipped to say no to friends and family. Once family and friends learn of the windfall, they will have expectations of what they should be entitled to.

But also, there are complete strangers who targets lottery winners. Some with sad stories, others with investment ideas and still others who aims to rob, maim or kill lottery winners.

Typically, lottery winners go broke as a result of a million cuts. One bad investment idea or falling for one sad story will likely not completely deplete the millions won. However, not paying attention and learning to manage your money will eventually lead to bankruptcy or worst.

Addiction

There is the saying that money does not buy happiness, it only amplifies who you are. A jerk before having a lot of money, will likely be a jerk with lots of money after winning the lottery. If you were previously prone to addiction prior to winning the lottery, now you are a wealthy individual who is prone to addition with the financial means to support that addiction. If you were an alcoholic before winning the lottery, you are now a very rich alcoholic. For those with addition issues or tendencies, winning the lottery and having the financial resources to support an addition habit is dangerous and can be deadly.

For those who cannot handle stress, winning the lottery will add a lot of stress. There is some stress that comes with having the money. You will like be stressed about how to maintain it, how to manage it, how to handle the constant requests for handouts, and how to face resentment (because it will come from family and friends). For many, alcohol and drugs are the remedies often sought with stress. It is not uncommon for many lottery winners to blow huge sums of their winnings on drugs and alcohol. At times, this is in an attempt to cope with their new lives as lottery winners.

Not Asking For Help

As mentioned above, many lottery winners were not finance majors in college. As such it is probably in their best interest to seek advice from qualified financial professionals. However, despite the fact that sudden wealth can cause lots of financial complications, very few lottery winners seek professional help. Very few lottery winners seek out professional advice on how to grow and or maintain their wealth. Without the requisite knowledge of how to manage such an instant inflow of funds, many lottery winners mismanage their money and go broke.

Conclusion

With winning the lottery or with any other instant financial windfall, be careful what you wish for. Many lottery winners go broke. By not being able to handle the stresses of winning the lottery, you could end up being a lottery winner that goes broke or worst.

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Video Summary

Not getting The promotion

You Did Not Get The Promotion, Now What

Money Maroon

At some point in our lives, if you are an employee, a worker for pay, you will miss out on a promotion in view of someone else. This other person may be a current coworker or someone from outside the company. In either case, it will leave you wondering, why. Especially if you believe that the person receiving the promotion is less experienced and/or less qualified.

Be Graceful

Once a promotion has been given to another, congratulate that person. Rise above your feelings of disappointment and be professional. No matter how you may be feeling, your reputation matters. Do not come off as unprofessional or as someone who do not know how to deal with disappointment. By not being graceful or lashing out because you were passed over for a promotion, you may be confirming that you are not mature enough for the role. Be graceful, even if it is difficult.

Evaluate Why You Did Not Get The Promotion

If you missed out on a promotion, you will be hurt. This feeling is normal. It does not matter whether or not you really wanted the position or not. Just being rejected will have an effect. While you may be hurt, you must try to be objective. Was the chosen person better for the role? Where you misled about what is required for the role? Do you think that you were treated unfairly in any way?

If in the end you were objectively not the best person for the position, if you really want this position, it is time for you to add to your skillset. Work toward a direction that will get you where you need to be.

On the other hand, if you were truly the better person, find out why you did not get the role. Is there a bit of favoritism or some other isms at play? Did you have the credentials, but others did not believe that you were qualified or ready? If this is the situation, it may be time to begin advocating for yourself. Begin to show who you really are and what you know. At times, the most qualified person may not get the position. The role typically goes to those who promote themselves. Lots of idiots have been promoted because they know how to play the game.

Ask For Feedback

Ask for feedback. If you did not get a role that you believe that you are qualified for, ask for feedback. Note that most managers are terrible at giving feedback, so try to read between the lines. At times, when you ask for feedback, your manager may justify the case for the other person being promoted, without actually giving you the feedback you asked for. So read between the lines. 

Some managers will provide adequate feedback and provide a roadmap to being promoted.  This rarely occurs, but it does. When you have such a manager, you are very lucky. You are more so lucky if the roadmap provided actually leads to a promotion.

Some managers will flat out tell you that you did not get the promotion because you are needed in your current role. If this happens to you, it may be time to leave. It essentially means that you are too good at your job. The company is not incline to promote you and train two people to do your work, when they can simply keep you at that position.

Some managers may even say that you will be up next or there was a business need for a specific skillset or there will be more opportunities in the near future. It will really be up to you to believe if this is truly the case or not. Many employees have been strung along in the past with the promise of a position opening up or an opportunity that is just on the horizon. Be careful in how you approach these promises. Many times, these promises are only lip service for you to calm down and to move beyond your disappointment.

Review The Landscape

In your evaluation of why you did not receive the promotion, review the landscape. Were you best placed for the role? For example, were you told not to apply, encourage not to apply or told that there are certain requirements but then the chosen individual did not fit the announced requirements? There could be more at play here.

Take a step back and look at the individuals in the role that you did not receive. The requirements posted about the role may just be a preference but not really a requirement. The most important characteristics may not actually be posted. By looking at who previously occupied the role, or who currently occupies that role, you can gain a lot of information. 

Some corporations have a certain type that is elevated to certain positions. That may be education level, select schooling, sex, race or demeanor. When you look at the role you missed out on, do you fit? This is a real question and you must be honest with yourself? If you do not fit the role, it may be time to leave as it is unlikely that you will ever be elevated to that position.

Improve Yourself

If you received a road map that will lead to a promotion, if you believe that the recommended action would lead to a promotion, follow that path. Also, seek to improve yourself for the job you want with your current company but also for another company. Work to improve yourself not only for a promotion but also to better yourself. Take additional classes in an area. Volunteer for new assignments. Work across departments. Make your resume the best it can be for your future role or new job that you may be interviewing for in the near future.

Didn’t Get The Promotion, Leave!

If you believe that you were wronged, or you see your non promotion as a pattern of activities, begin your task of leaving. Many times when we work for a company, we may hear stories and rumblings of who is being promoted. It may not bother you at first because it was not affecting you, but once it affects you directly, you may see things a bit differently. If you are in this situation, know that this is how your company works, and they will likely not change. As such, it may be time for you to leave.

This does not mean announcing that you will leave or making an ultimatum. Simply prepare your resume and improve yourself. Over the next few months, keep an eye on job openings and apply. When the time is appropriate give your two weeks notice and move on. There is no reason for you to stay in a toxic environment. Especially if your non promotion begins to impact your mental health.

At times, once you give your two weeks notice, you may be offered a higher salary, you may even be offered a new role. Whether or not you stay at your current company or leave is up to you. But note and keep in mind what it took for the company to come up on your salary or offer you the new role. You had to threaten to leave. Will this be required going forward? This also does not bode well for you when times are hard and the company performs a reorganization to cut headcount, it is highly likely that you will be cut.

Conclusion

At some point in our lives, if you are an employee, a worker for pay, you will miss out on a promotion in view of someone else. This other person may be a current coworker or someone from outside the company. In either case, it will leave you wondering, why. Especially if you believe that the person receiving the promotion is less experienced and/or less qualified. In these situations, be graceful, evaluate why you did not receive the promotion, ask for feedback, improve yourself and if necessary, leave.

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Athlete

This Is Why Athletes Go Broke

Money Maroon

Over the years, for professional athletes, we have seen astronomical contracts that have repeatedly broken records. We have also seen the sobering news that many athletes go broke. At times, we may fall into the trap and think, how can you go broke after earning hundreds of millions of dollars? But do not forget, a lot of our sports stars are young and have never had the life experiences that would have taught them how to manage money and plan for the future. 

Athletes Go Broke Due To Short Careers

For most athletes, once they sign the big contact, the financial mistakes are immediate. Some begin spending in anticipation of the contract or is out spending once signed. This happens in some cases because like us, many athletes are aware of the superstars who have decades long careers. Many rookies believe that they will continue to play their respective sports for years to come, earning an ever increasing salary. But this is not the case.

For the National Basketball Association (NBA), the average player lasts around 4.5 years. Like many other sports, making it to the NBA is hard, staying there is even harder. For the National Football League (NFL), the average career length is about 3.3 years. Let’s take a deeper look at the NFL. On average kickers and punters last 4.9 years, quarterbacks last about 4.4 years, cornerbacks last about 2.9 years, wide receivers last about 2.8 years and running backs last a dismal 2.5 years. Those in the National Hockey League (NHL) fare a bit better and last around 5 years. The average career of a Major League Baseball (MLB) player is about 5.6 years, and soccer players have careers of about 8 years.

It is therefore unsurprising that the average retirement age for MLB players is about 29.5, 28.2 for NHL players, 28 for NBA players, and 27.6 for NFL players.

If you have no transferable skills, lack financial discipline and your career lasts only a few years, you will have financial problems. No wonder athletes go broke.

Athletes Go Broke Due To Their Contracts:

Not all sports contracts are created equal. In some leagues, it is normal for the contracts to be guaranteed, but this is not the case for others. So when a player signs a contract for hundreds of millions of dollars, depending on the league, they may never receive the full amount.

Players’ contracts are guaranteed in Major League Soccer (MLS). For the most part, NBA, MLB and NHL contracts are also fully guaranteed. However, this is not the case for the NFL. For many NFL players, only a portion of their contract is guaranteed. This is very troubling as the NFL has one of the shortest career spans of the major sports. NFL players are faced with only a few years on average of playing in the league and also not having guaranteed contracts. Don’t forget, as a contact sport, NFL players also have a very high risk of injury.

Young And Dumb

If you received 100 million dollars upon your 18th birthday, in ten years, would you have more or less. The fact is, for many of us, at the age of 18-25, our sense of money is to get it and spend it. For many, this is the period of time where we spend a lot of time trying to impress the opposite sex. 

With money, comes the expensive cars, clothing and homes. At this age, as hormones rage, it may be a matter of time before kids. For many professional athletes, kids occur outside of wedlock which leads to child support and crazy exes. Think of your twenties but to the extreme. The fact is, not many of us could manage money in our twenties.

For athletes, it is a bit worst. Everyone you know, knows that you have money. Everyone around you potentially will have their hands out or will be reaching into your pockets. For so many athletes, it was family, agents, accountants or friends that stole from them. It is no wonder about 78% of professional athletes go broke after 3 years of retirement. Some professional athletes stand very little chance of building wealth in view of the people that are around them.

Most professional athletes just do not realize until it is too late – your career will be short, and your savings must last for the rest of your life.

What Can We Learn

What we can learn from athletes is that it is not about how much money you have, it is about how much you keep and grow. If you have no financial background or do not know how to mange your money, it is likely that you will lose it. No matter if it is 10 dollars or 10 million dollars.

As you move through your career, or your many careers, learn to manage and grow your money. You should learn who to trust and set boundaries with friends and family to ensure that your financial future is secure. Be the CEO of your life and your financial position. It is your money so take responsibility for what happens to it.

Conclusion

Over the years, for professional athletes, we have seen astronomical contracts that have repeatedly broken records. We have also seen the sobering news that many athletes go broke. At times, we may fall in the trap and think, how can you go broke after earning hundreds of millions of dollars? But do not forget, a lot of our sports stars are young and have never had the life experiences that would have taught them how to manage money and plan for the future. 

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Wedding rings

Your Wedding Cost & Crushing Debt

Money Maroon

It is wedding season again. It is time to overpay to join union with another. Don’t get me wrong. A wedding is a beautiful thing. However, so many overpay to show love. If you are currently planning your wedding or have planned your wedding, focus on your wedding cost and do not go into debt for your wedding. Please do not do it.

The Wedding Cost

It is no doubt an exciting time in life. Your partner asked and you said yes or vice versa. You are about to make it official, you have a wedding in your future. If you are not simply going to a court house to sign the papers, watch your wedding cost closely.

You will need to plan out how you will pay for things like your wedding venue, flowers, chairs, photographer, food, alcohol and anything else that may pop up. I do not know why, but when “wedding” is attached to any of the above, the prices explodes. You will be charged a premium.

Expectations

To ensure that your wedding cost does not explode, do not make wedding decisions or purchases because it is what is expected or traditionally done. If you do what is expected, you may run yourself into financial trouble.

It is important to understand, for a wedding, everything have a cost. Further, as the guest list grows, so does the cost. As such, it is important to do what is important to you and your partner. Do what you want and what you can afford. Because in the end, you may fulfill everyone’s expectations, but you and your partner will be left with the bill. At times, this could be a very big bill.

One Day

Do not fall into the trap of believing  that your wedding day is the most important day of your life. It is a special day, but it is only one day. One day that will cost you thousands or hundreds of thousands of dollars if you do not pay attention. This day may also set you on the trajectory of a divorce as well.

Remember, close to 50% of all marriages end in divorce and the number one cause of divorces tend to grow from financial issues. Starting out your marriage in substantial debt is not a good start. Further, so many couples divorce while haven’t paid off their wedding day debt. This is a cruel situation to be in, divorce and still paying off your wedding.

If your next step after marriage is kids and/or a new home, note that these are also very expensive. The better financial situation you begin your marriage in, the better. Do not ruin your financial life for a wedding.

Control Wedding Cost

To control wedding cost, consider what you could potentially change. Also consider what is right for you and your partner.

  1. Change the venue. The venue comes with a lot of costs. For example, the venue typically sets the price for a number of different aspects of the wedding. By changing your venue, you can significantly impact the cost associated with your wedding. A golf course on the ocean will have a very different cost profile as compared to a church in a small town. 
  2. Communicate. Communicate not only with your partner but also with your friends and family what your financial boundaries are. This may lower expectations and reality check your friends and family. Be upfront about your expectations of them and what it is that you want for your wedding.
  3. DIY. There are some things that you can do yourself or have a friend do. For example, taking your engagement photos. This is one task that anyone with a good camera can do. You may also choose to make your own table numbers, for example. There are a myriad of ways for you to get involve and lower the cost of your wedding.
  4. Change when you will have your wedding. There is a wedding off-season where you may be able to get a discount. Also consider having your wedding on an off-day. You could have your wedding on a Friday or another day during the week because the weekend tends to be significantly more expensive.
Wedding ceremony sign

Conclusion

In the end, whatever you choose to do on your big day is between you and your partner. Make decisions for your longterm future and if possible, do not go into debt for your wedding. Your financially independent future self will thank you.

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