Nov 152013

The following is a guest post by Jacob, a PhD student in financial planning.

crazy dudHave you ever noticed that the way you “should” do things, according to societal norms, is often the most screwed up backwards way to find success at anything?

Consumerism is especially bad in our first world environment. Society encourages you to buy things you can’t afford. It’s cool to buy the latest, the greatest, and everything in between. The media outlets all promise eternal happiness if you’ll just keep up with the Joneses.

Here is some common financial advice that blows my mind:

  • A new car is a good investment to avoid repair costs. Financing one at 0% interest every 2-4 years actually saves money in the long run.
  • Clothing prices are representative of quality. If you pay more, you’ll look better and they clothes will last longer!
  • You have to buy nice things to get ahead in a career, and generally in life. If you don’t spend money, you’ll fail to impress potential employers, clients, and everyone else who is constantly scrutinizing your lifestyle choices.
  • Eating out is a way of life. Everyone does it. The whole experience is worth more on a dollar per hour basis than the required cleanup/cooking time of a home cooked meal.
  • The stock market is a complete mystery. The individual investor has no way of competing with those big hedge funds and money managers. Consequently, the individual is far better off leaving his money with a mutual fund manager.
  • The stock market is wildly inefficient and professionals who pick stocks often do far better than the individual. The PhDs running the research and stats have a huge advantage.

Is anyone else blown away by the madness of these ideas? Follow them and you’ll be a poor slave your whole life. A slave to credit cards and paychecks and stress.

You’ll be one of the 95% who just can’t seem to get ahead in life. Retirement at 65 might even seem difficult, despite a huge paycheck in a country with unlimited amounts of waste that can be leveraged by the savvy individual to spend even less.

What I’m trying to say is this. Blaze your own path in this life. Learn to be resourceful. Embrace all of the opportunities available that enable you to live much more of life on far less money.

To begin with, make it your life’s mission to avoid popular media folk tales and the INSANE financial habits that consume most Americans. Forget about the Joneses. Forget about name brand nonsense. Forget about instant gratification. Forget about your pride and just starting doing life in a way that makes financial SENSE.

It’s not a one size fits all sort of proposition. But the common denominator is always related to spending less. Once you realize the power of saving first and consuming second, life starts to get a little easier.

First, the debt disappears, then the opportunities start rising. We knocked out $19,000 of debt in our first 9 months of marriage and still found a way to sock away enough to max our Roth IRAs and the required amount for a 401k employer match.

Now, we’re swimming in the positive cash flow of our middle America jobs, and trying to figure out the next steps of our plan.

If you’d like to know our secrets, start with this list of ways to avoid winding up broke and miserable:

  1. Never purchase anything that can’t be paid for in full (except a house)
    • Use cash back credit cards and pay them in full each month
  2. Never buy new items if they can be found in good condition on Craigslist
    • Sell the crap you don’t use on Craigslist
  3. Never pay retail for clothes
    • Look at thrift stores and garage sales
  4. Cook homemade meals with ingredients that you purchased on sale
    • Learn the art of price matching each week
  5. Never eat out to fit in or because “you deserve it”
    • Eat out to celebrate (very occasionally)
  6. Never allow peer pressure to influence a financial decision
    • Always try to influence peers to become better savers
  7. Never buy something out of compulsion
    • Always buy out of necessity
  8. Never buy something without doing research on the price of viable alternatives
    • Spend the time and find the deals
  9. Never buy something to impress someone else
    • You’re the one who has to pay for it
  10. Never buy an item that won’t be used
    • Always sell what you haven’t used in the last year
  11. Never buy a new car or take out a loan for a car
    • Cash, always. Let someone else eat the bulk of the depreciation
  12. Never buy Cable TV
    • Cut the Cable Cord and watch shows online for free
  13. Avoid financing an undergraduate or graduate degree with student loans (Yes, some professional degrees are exempt from this rule)
    • Work hard in high school and undergrad,  find scholarships, and live at home if you can
  14. Never take financial advice from someone who makes a living selling loaded mutual funds
    • Open an account at Vanguard or Motif Investing and choose your own investments
  15. Never stop tracking your financial situation, portfolio, and spending habits
    1. Get a free account at Personal Capital

Now keep in mind, this is my list. I could go on and on, but I would rather you make your own set of financial rules! Please let me know what you come up with in the comments section!

Author Bio: I’m Jacob, one half of the Cash Cow Couple. My wife and I enjoy teaching others how to live an abundant life on a very modest salary. We are attempting to spend less than $12,000 in our first year of marriage because we enjoy a good challenge!

Jun 192013

Car insurance premiums vary depending on province.

This is a guest post by Jon Haver, a recent father trying to make sense of the Canadian Insurance landscape, he writes at

From British Columbia to Prince Edward Island auto insurance can cost a surprisingly different amount! Travel from one end of Canada to the other and other than a lot of boring stuff in the middle you will find average car insurance premiums can vary greatly from one province to another if you ask.

You can be in Ontario and pay on the highest end with an average premium per year of $1,878. But just over in Québec you will pay only $863 per year – but if you slip the Mayor of Montreal $100 you don’t have to pay. Prince Edward Island is the place with the cheapest insurance at $649, but New Brunswick tops out at $1123 and it is right beside it. Continue reading »

Jan 082013

This is a guest post by Peter Thompson. He is the founder of the boutique firm GreenWorld Forestry and Farmland Investments. GreenWorld concentrates on offering “real assets”, and have been particularly popular.

For a small investor with an adversity to risk it is very difficult to find investments that keep up with real inflation.  By real inflation, we don’t mean the inflation reported by government statistics, I mean the inflation we all see when we shop for groceries or when we fill the car and generally the inflation we see are out shopping.

Another concerning aspect for the small investor, one the worries many people about their savings, is the safety of cash on bank term deposit.

What will happen when the next big leg down in the current economic crises occurs, will the banks we have our money in be secure? Will governments be capable of honouring bank guarantees? How safe are the banks in Europe? If there is a major economic collapse, which inevitable, how safe will deposits be? Could a government which is suddenly faced with massive claims on government guaranteed bank deposits schemes, be able to make good such guarantees

These concerns have lead we at GreenWorld – as well as many of our clients – to a favourable view of agricultural land as investments.

Many people have discounted farmland as an investment option due to the inflated prices paid for land in in agriculturally subsidised Europe, the western parts of the European Community. That view changes, however, when people discover the options available of investing in countries which have not suffered from spiraling land prices.

For example, the price of high quality arable land in Africa is extremely low, and the introduction of western farming methods can frequently produce huge returns for investors. Whenever I speak to people about investing in Africa one of the first responses is “how risky is that” or words to that effect. Investors see a possibility of civil war and problems of corruption. These concerns were my own too.

These concerns are real, but in Sierra Leon for example – where one of GreenWorld’s three farmland investments is located – we think they are of acceptably low risk, especially as Sierra Leone has developed extremely close relations with the UK and has made it official government policy to promote and support foreign investors.

In our view, a well run farming project in a small, stable (over the last decade or more) African nation offers more safety than the badly managed and corrupt economic system prevailing across Europe and many Western Countries, where printing money and more debt are the only “solutions”.

Speaking of printing money, as a hard asset, farmland is also an excellent hedge against inflation. Farmland is a “real asset”, and as such, more of it cannot be created or printed into existence by global central banks. With western central banks having already engaged in extensive Quantatative Easing (QE), and likely to engage in further QE as well, investors would be well-advised to consider adding inflation hedges to their portfolios.

Another reason to look at adding farmland to a portfolio is that it is a wonderful way to access a critical, long-term global macro-trend; namely, the combination of a rising global population combined with shrinking arable land. Indeed, as the graph below demonstrates, this trend is very real. It is the most basic rule of economics – if the demand foor something goes up (rising population with more mouths to feed) and the supply of it goes down (shrinking arable land), the investment fundamentals will be very, very favorable.


Finally, many people look at farmland and think it involves purchasing a farm, hiring people to farm it, and other major logistical concerns. What many are not realizing, however, is that there is a new trend in agriculture investing to make farmland available to individuals as a purely passive investment.

Whilst farmland investment has indeed been dominated by larger institutions historically, in just the last several years a number of options have been developed for individuals. The most common is for a project developer to own and operate a large farmland project, and then offer parcels of it to individual investors. Under this model, farmland becomes a purely passive investment, as the he project developer will handle all of the logistics of the project, from the planting to the harvesting to sale of the crops.

The conclusion? If you have never considered investing in farmland previously, it may well be worth taking a look at this asset class now.