Liquid Independence

Liquid is the main editor of the Freedom 35 Blog.

Feb 272015
 

Sheryl Sandberg thought she was making a mistake. The year was 2001 and she had applied for a general manager of business units position. Sheryl began to doubt if there was even a job there at all. The small technology start-up didn’t even have “business” units so what was there to manage? Furthermore the position appeared to be several levels lower than jobs she was being offered at other companies. :?

So when she finally met with the company’s CEO, Eric Schmidt, she kindly explained that the position meets none of her criteria. :| Then the CEO of Google looked at her and replied, “Don’t be an idiot.:? That’s some pretty solid advice. “Get on a rocket ship,” he continued. “When companies are growing quickly, careers take care of themselves. But when companies aren’t growing… that’s when stagnation and politics come in. If you’re offered a seat on a rocket ship, don’t ask what seat. Just get on.

And that’s exactly what Sheryl did. :D

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Eric was right. When companies are small their workers can grow into new positions. Managers are created instead of replaced. People have more autonomy, feel more involved, and everyone can learn new skills and take on new responsibilities without stepping on each other’s toes. It’s more than a zero sum game. You don’t need to knock someone else off the ladder to get ahead because there’s plenty of room for everyone to climb. :)

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Feb 242015
 

In self defence class we learn to fight… so that we won’t have to. Personal finance is very much the same way. :) The best thing that money can give us, is the freedom to not worry about money anymore. Sometimes we can become so focused on our finances that we can easily forget about actually living a life. To me financial wealth is not simply about having money. It’s more about having better options in life. A lack of money is a great disadvantage. Poor people have a greater affinity to stay poor. Their lack of resources keeps them from having access to better opportunities and choices that many middle class and rich people take for granted. Having a limited amount of choices can lead to further unsatisfactory circumstances, so it becomes a self-reinforcing cycle.

We spend a lot of time planning our budgets, building up our savings, and looking for profitable investments, but in the end we should realize that doing all this work is not about the money. It’s about the freedom and the awesome choices we’ll be rewarded with! :D We do not want to become obsessed about “money,” in and of itself. We don’t want to turn into those kinds of people who think that the best thing about wealth is that it allows them to buy material things. :| If that’s what they really want to believe then I wish them good luck in life. :P

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There’s a popular story that demonstrates the silly nature of materialism in the world today:

A successful businessman bought a brand new BMW M6 convertable. He parked it right in front of his office so that he could show it off to his fellow co-workers. As he got out his vehicle a passing garbage truck lost control and side-swiped his car, ripping off the door on the driver’s side. The police quickly arrived and the businessman began ranting hysterically that his new BMW was now ruined.  :-x After 10 minutes of profuse shouting and cursing, the businessman was finally able to calm down. The police officer then said to him, “You are so focused on your car that you don’t notice anything else. I can’t believe how materialistic you are.” The businessman looked confused. “What do you mean?” he asked. The police officer explained; “Haven’t you noticed that your left arm is missing? It must have been torn off in the accident.” The businessman’s face went white. “OH NO!” he screamed. “My Rolex!!”

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Feb 242015
 

The following is a guest post.

If you have been injured in an accident and have filed a civil lawsuit, you might consider pre-settlement funding. People who have been injured in an accident often cannot work but still have living expenses. A pre-settlement company provides the victim of an accident with money prior to the resolution of a civil lawsuit. The median length of a civil lawsuit is nine months, which has remained constant in recent years, according to a Princeton University study. But many cases take longer, because insurance companies want to drag out the process. According to the study, on 1.8% of cases went to trial. That was down from 11% in 1962.

“Pre-settlement funding is beneficial to people who are injured, especially those who cannot work,” said Sara Murphy, administrator at Cash in Your Case, a pre-settlement funding company in New York.

Here are the answers to several questions you might have about using a pre-settlement funding company:

What types of pre-settlement funding are there?

In general, pre-settlement takes two different approaches. The first is a lawsuit loan. The other is pre-settlement financing. While they sound similar, they are very different. A loan lawsuit, like the name implies, is a loan. A company loans you a certain amount of money based on the expected outcome of a lawsuit. You are required to pay the money back. On the other hand, pre-settlement financing is an advance. You pay the money back once the lawsuit is resolved. If you lose the case, you’re not required to pay the money back. Both a lawsuit loan and pre-settlement financing will charge you interest for the money, so make sure you read the contract before signing.

How does the process work?

If you are considering pre-settlement funding, you start with an application. That means you provide the particulars of your case and a little about your background. You will also give the pre-settlement company your attorney’s name. The pre-settlement company will research the lawsuit and evaluate the potential for a financial resolution in the case. Based on that information, you will be presented with terms for pre-settlement funding. You must decide if you want to accept the terms. It’s usually best to talk with your attorney. He or she has a good understanding of your case and the chances of winning a significant sum in a lawsuit. The process can take as little as 24 to 48 hours.

What can I use the money for?

You’re allowed to use the money for anything. It’s your money. Most people will pay a mortgage or living expenses. Others pay off medical expenses or outstanding credit card bills.  You should talk with your family and decide the best avenue to spend the money.

Conclusion

There are several companies that offer either pre-settlement financing or lawsuit loans. Most have a websites. Some of the larger companies are reviewed and rated online. Also, ask questions.

Feb 212015
 

Last month I blogged about investing in German real estate through a Canadian REIT called Dream Global. I chose this investment for its strong foothold in the European economy and for the consistent high yield. Normally dividends from foreign investments are taxed. However because I’ve bought DRG.UN in my Tax Free Savings Account it wasn’t really clear what would happen. Well yesterday I received new confirmation in my brokerage account so I thought I’d post an update. Thanks for the reminder, Bricks. :)

Each Dream Global unit currently pays out $0.066667 per month. Since I purchased 180 shares in January I received $12 in distributions this month. As it turns out there doesn’t seem to be any withholding tax on these payments. :) Below is a history of my TFSA transactions for 2015 so far. As we can see near the end of January I initiated a buy order for Dream Global REIT. And then on Feb 13th, when the company paid its investors, I received $12.00 in my account. :D

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If there had been any foreign with-holding tax it would have been deducted from my account on the same day as I received the DRG.UN distribution. For those who are curious, The abbreviation “TXPDDV” is simply TD’s transaction code used to describe money earned from a combination of different sources including dividend, interest, foreign dividend, capital gains, or return of capital. This is an administrative code used for tax purposes on a T3. In an unregistered account this “TXPDDV” designation means that tax factors have not yet been applied and is frequently misinterpreted as an indication that tax has already been paid. However in a registered account, such as a TFSA or RRSP, there are no T3 tax slips associated with these types of distributions. I called TD Direct Investing earlier today to confirm and that’s what one of their associates told me. So yay. :) I should have invested in this company sooner. 8.7% annual yield on DRG.UN and no tax!

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Feb 182015
 

The government of B.C. just tabled another balanced budget. Finance Minister Mike de Jong’s latest budget projects a surplus of $284 million for 2015-2016. :) This means B.C.’s $63 billion public debt is slowly being paid down. B.C. may be the only province in Canada to avoid falling into deficit amid plunging oil prices. But there’s something else that the finance minister didn’t tell us. How did this surplus happen exactly?

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In order for any government to have a surplus it must take in more money than it spends. Government revenue comes mostly from tax payers. In the past I have blogged about how money in the economy is generally created by people borrowing from private banks. So I believe a major reason the B.C. government is able to balance its books is because consumers in B.C. are going further into debt. We’re essentially shifting the debt burden from the government to the private sector.

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