Phantasmix (aka Re: money)

Photo credit: vflashton

We just returned from a Chapters/Indigo store, where I picked up a couple of books for $2 each. It’s insane! They’re perfectly nice hard-cover books in jackets, one of them is actually by Jim Rogers (”Adventure Capitalist”). And there was a whole bunch of books under $10. I noticed that some of them were printed in China, but others were printed in the U.S. and Canada, and they were these big, full color books for $7.99. How can they possibly cost so little? This is one area that inflation hasn’t touched at all, that’s for sure.

It’s a sad and shocking sight, but I guess it’s a sign of the times. I, too, read online a lot more now, mostly free resources. I can’t say it’s as enjoyable and/or useful as a book, but it sure is addictive.

And weather’s been really weird: it’s a nowhere land between winter and summer, not really a book reading season.

I have 6 books on my night table right now. One that I keep re-reading since I was about 12, one half-started, and four “fresh” ones. Going to try and make time for them in the next couple of weeks, and will cut down on my computer time.

Thinking about how our Net Worth should be split up, I came upon various suggestions as to the Asset Mix. Provided the world remains as it is now, one should have a balanced mix of Stocks, Bonds, Real Estate and Cash. All elements are optional, of course, but everyone agrees that 100% should not be kept in one basket.

Provided the world remains as it is now…
I have a fear that one fine day all of it can just go to hell. The market, the governments. I’m also afraid of WWIII. This - hopefully irrational - fear is preventing me from investing much into stock market. Of course, Reason tells me if there ever is a World War, all money will lose its value anyway, so why worry about it? The smart thing would be to live assuming that it’s all going to be alright.

I don’t know where this fear comes from. I’m 27 years old, I never had to live through a Depression or a War (not in my country, anyway). My Grand-Parents did, maybe I paid too much attention to their stories. I think I have the mindset of the survivors: Only hard cash is real to me. This is a huge mental block I have to break because, it’s actually costing us money: while it idly sits in the bank, it’s losing value.

To start investing, I mean really investing, that’s something I have to fight.

The accessibility of discount brokerages and ability to trade as easily as checking email are perfect circumstances for becoming an investment gambler. Even more reason to approach this carefully. Play money (that $3,500 I invested just for fun) was fine, and I think I made a few good choices. That’s encouraging, but to invest significant amounts there has to be some sort of rhyme and reason - a philosophy - behind it all.

I’m reading some good books on investing right now. By the way, can you tell good investment books from the bad? (Question from “The Only Investment Guide You’ll Ever Need”. I’m still reading my library copy but it’s a fantastic book that I’m going to buy). I’ll tread lightly at first.

Other highly recommended classic investment books I’m reading (aff. Amazon links):

Just got a fresh issue of Fortune, there’s an insert with an excerpt from Jean Chatzky’s “Make Money, Not Excuses” book. I used to subscribe to Jean’s email newsletter, and it was often interesting and useful (but then she started recycling advice too often).

The excerpt offers 2 scenarios of setting up family finances (both call for separate accounts plus a joint account for common expenses), and 4 fight-and-fix scenarios for money arguments. The biggest problems seem to be these:

I can’t give a thorough review of the book since I haven’t read it, but even these 4 short pages offer some good advice. I particularly like the “don’t micromanage” part and this:

“Before you can make either of these systems work, though, you have to be able to hold a conversation about money without its deteriorating into an argument… The good news is, once you start talking about money, it gets easier to keep talking.”

From the very beginning, years ago, we didn’t start our money conversations on the right foot. Now, even when we do intend to be calm and adult when talking about money, one of us very quickly starts yelling. We’ve pre-conditioned ourselves that money is a prickly subject and we can’t talk about it in a reasonable manner.

We’ve got to break that pattern, I just have to get my husband to admit that he starts yelling as often as I do, if not more.

Just look at my blog roll: Million Dollar this, Million Dollar that… Seems a lot of people are fixated on this round number. There must be a story behind it. Why a million dollars? (Seriously, if you know or have any ideas, please share). And how is $1ml different from $800,000? I think that most -average- people would find they actually need less than a million to feel comfortable and do what they please. There would most definitely be a threshold amount, after which their satisfaction with getting/making more would be diminished (I know, nothing new: Joe Dominguez and Vicki Robin covered it pretty well in “Your Money or Your Life”,I still think it’s worth discussing.)

I would be comfortable enough if we had a 5-year cushion and a paid off house (in Europe, which may be a bit more than a paid off house in Canada). That’s it, nothing more. I enjoy my work very much and don’t even dream of retiring yet, not by 35, not by 40. I would like to have kids while in my 30’s so that might be sort of a temporary retirement, but the cushion would supposedly take care of that.

BUT….I’m not sure that aiming relatively low in terms of desired Net Worth is the right strategy. After all, they say if you wish for something bad enough, you’ll eventually get it, because all your actions - even if subconsiously - will be aimed at that desired goal. I should make myself want more, brush aside all the modesty and wish for a million.

Once I re-condition myself, I’ll rename my blog “re: Million Dollars”.