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How Much You Keep, Not How Much You Earn

Rich people who die with money issues tells us that spending more than you earn is risky for individuals, and for entire countries

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The tragic death of Robin Williams in 2014, who took his own life while suffering from severe depression as well as facing money problems among other things, reminds us of a truism of personal finances: it doesn’t matter how much you make in any given year, or in the span of your career.

If you spend more than you make, and do it in a hurry, you can end up as bankrupt as anyone. This last year has been particularly tough for many people and so prudent finances are more important than ever before.

Here Today, Gone Tomorrow

Yesteryear, we often read about professional athletes or entertainers who annually earned multimillions of dollars, but then, a few years out of the sport, or out of the celebrity limelight, fell into financial ruin.

How could someone raking in several million dollars a year, we thought, end up penniless? How foolish, how reckless, how wanton could people be with their money?

Today, at least among pro athletes, money managers ensure that said individual will have regular annual income for life. In pro contracts, clauses stipulate how much of an athlete’s earnings will actually be dispensed in any given year.

Hence, 15 to 20 years out of professional sports, an athlete who had been earning, say, $10 million a year will be assured of income for life as a result of effective money management. Celebrities who are wise enough to choose effective professional financial counsel are similarly aided.

Low Debt = Breathing Space

No matter how much you make, if you don’t effectively manage your money, it can all go to pot. Studies show that an inheritance, of any size, is dissipated on average within seven years. So, whether someone receives $5,000 or $500,000, on average, far too soon all that money is gone.

Being in debt is not conducive to having breathing space. In fact, it’s the antithesis. When you’re in debt, that reality has a way of dominating your day. When the next bill arrives, you think about your finances. When the next mortgage or rent  payment becomes due, the issue arises again.

Every time you write a check, or surrender your credit card to a vendor, or even take money out of your wallet, you are reminded of your tenuous financial condition.

When you’re in debt and seek to re-pay it, you tend to work longer and harder. You want to make extra money to pay down credit card balances. Living beyond your means, however exhilarating in the short run, is insidious in the long run, for people and for entire nations.

The constant drum beat in the back of your mind, “I’m not making it,” “I owe others,” and “What if people find out?’ can wear down an individual in ways that we don’t even fully understand.

Construct a Cash Flow

The fastest and easiest way to understand the state of your current as well as future personal finances is to construct a 12-month cash flow spreadsheet.

A well-constructed cash flow plots all of the incoming cash and revenue from all sources, and to the best of your ability projects all of the expenses you will be incurring. A 36-month cash flow is more ambitious and more revealing.

It’s too easy to get caught up in thinking, “I’m making a big bucks annually, and my goodness, what do I have to worry about?” The fate of rich people who die with money issues tells us that you have plenty to worry about if you spend more than you earn.

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Jeff Davidson is the world's only holder of the title "The Work-Life Balance Expert®" as awarded by the U.S. Patent and Trademark Office. He is the premier thought leader on work-life balance, integration, and harmony. Jeff speaks to organizations that seek to enhance their overall productivity by improving the effectiveness of their people. He is the author of Breathing Space, Simpler Living, Dial it Down, and Everyday Project Management. Visit www.BreathingSpace.com for more information on Jeff's keynote speeches and seminars, including: Managing the Pace with Grace® * Achieving Work-Life Balance™ * Managing Information and Communication Overload®



 
 
 

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Elections

Will You Take Action to Assure GOP Victory on November 5?

Every single person voting Republican needs to decide now, how they will lend support to the cause

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In less than 17 weeks, the GOP will take back the White House, and hopefully the Senate and House, and begin to restore America. Or, we’ll face a gargantuan nightmare that will all but seal the fate of this nation. Do not be fooled by Joe Biden’s defiance of those calling for him to withdraw. Any Democrat challenger will be a danger to us because the DEMOCRATS WILL CHEAT IN UNPRECEDENTED WAYS.

Time is of the essence. While being informed is wonderful, taking action is paramount. What exactly will you do to ensure that we achieve victory? It is no longer sufficient to be a concerned bystander.

No End to the Left’s Destruction

Every day when you log on to news sites, you are flabbergasted by the degree to which the radical Left continues to impose its civilization destroying policies, programs, and activities on the rest of us. There is no end game for the Left, no bottom, and no limits to their mass insanity.

Most recently, we have learned of a professional couple who was greeted at 6 a.m. by armed FBI agents banging on their door to arrest them for having the temerity of stepping into the Capitol on January 6, for 12 minutes, ushered in by Capitol guards. We have witnessed the unending persecution and prosecution of Donald Trump over non-crimes that have been concocted in unison and are part of an overall strategy emanating from the White House.

We have witnessed corrupt district attorneys, corrupt prosecutors, and a corrupt press. Donald Trump is merely the bellwether. All other Republican politicians will be fair game from here on out, and if we lose the election in November, with little or no recourse. One by one, the maniacal Left will quash dissent in ways that perhaps we currently cannot imagine.

The Left is Maniacal

The logical outcome to having the Left predominate in all areas of society is a totalitarian regime. Don’t discount this scenario. As Leftists ultimately do everywhere, they demand compliance. Thought control is their desired form of servitude. For those who do not comply, execution is not out of the question. Like radical Islam, we’re dealing with a malevolent genie that has escaped bottle, has no intention of ever subsiding, and wants everyone to either totally capitulate, or be imprisoned, deported, or terminated.

There will be no effective way to dismantle the maniacal leftist machine if Joe Biden is re-elected, he continues to be the puppet of Obama and far Leftists, and the border continues to be flooded with illegals — until Democrats have congressional representation that steadfastly insures a permanent majority. At that juncture, they will pack the Supreme Court. They will end the Electoral College. They will ramp up gender dysphoria opportunities wherever they might lie.

They will continue to show poor judgment and ridiculous weakness on the world stage. They will kowtow to China on a wide spectrum of issues. They will embolden our enemies to the point where such enemies are ready to pick apart America. This is not hyperbole and is all too likely.

Nothing here is beyond the bounds of possibility and with each passing week becomes more likely for the distant if not foreseeable future. In a sentence, we simply must win in November. No alternative will suffice.

All of Us

All of which leads to the point that every single person voting Republican needs to decide now, how they will lend support to the cause. In what ways will you participate? How will you volunteer, where, when and for what duration? Will you donate money? Who will you influence to vote GOP?

How will you support your candidates locally, regionally, and nationally? How are you going to impact others? It would not be sufficient to say, “I was busy,” or “I felt we had an overwhelming majority.” This approach is gambling with the future of our nation, the future of our communities, and the future of our families.

If we are to win by an overwhelming majority, let us each assure one another that we did everything we could to make sure that that is the result. To do less is to simply take a child-like approach to what is perhaps the most eventful year since 1776, 1812, 1861, 1941, 1968, and 2001. There will be no palatable tomorrow if we lose in November.

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Life

Taking a Wrong Turn and Staying Safe

It is no time for equivocation when the issue is your safety and your life

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You take a wrong turn in the city, perhaps missing the desired exit ramp and you end up on a street with which you are totally unfamiliar. Old, abandoned warehouses and litter abound. People hanging around on corners don’t seem to have much to do.

Positioned for Caution

You consult your GPS as to how to get out of this neighborhood. All indications are that at best it will take a couple minutes, with some complex turns and twists. So, what do you do while you’re in your car?

Keep a safe distance from the car in front of you at stop lights or stop signs. You need to have sufficient room to hit the gas pedal in case you have to vamoose in a hurry. Especially while you’re stopped at a red light, stay ever alert. Continually check your rear-view mirror and your side mirrors to ensure that no one is approaching you.

Carjacking is not uncommon and, even with your windows closed, a crowbar can smash them in seconds. In any case, if someone does approach you, be prepared to speed away.

May I be of Service?

If you happen to be on the street, out of your car, at a gas station or retail store, be especially weary. If someone approaches you and, in a reasonably pleasant voice, says something such as, “How are you today?” be prepared to take off in a hurry.

Suppose it’s too late, and the ‘cordial’ greeter is merely a few yards away. In a loud voice yell out, “I have nothing to do with you,” or any other phrase that you think will draw the attention of others and perhaps startle the nearby greeter. If you’re a woman, it is okay to scream and shout.

If you need to stop at a gas station or some retail establishment and people are hanging around, it’s best to keep moving. Drive to another location where no one is lingering. In this day and age, nearly everyone is busy. When you see people with nothing to do, the odds are that they want something from you – it could be money or could be worse.

Generally speaking, people with responsibilities do not gather together in groups outside of retail establishments, alongside walks, or the streets. So, you want to avoid such situations all together.

Action Jackson

The upshot is you need to get back on the route you had originally sought. You don’t want to linger in an unfamiliar, strange, or suspicious neighborhood. You will stand out like a sore thumb. The regulars know when someone is lost or disconcerted and the malingerers among them will move into action.

Sorry if this sounds like it’s rather a stringent approach to urban affairs, but this is your safety and your life. It is no time for equivocation.

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