“There is one MFL concept I am interested in being better able to more fully understand, teach and implement. ‘Save from income and invest from assets.’ Basically, my understanding is to save from income, purchase assets with savings & leverage, and use the income from assets to…”

Your understanding contains two assumptions that are alien to The Money for Life Model for Creating and Managing a Personal Economy.

• · First, your question seems to assume “leverage” as a part of the investment equation. Leverage implies borrowing from others, so it implies that the source of borrowed money is not under the control of the borrower. The Money for Life Model rests on the idea that individuals and families need to control the money that flows through their lives. When individuals and families borrow from another, they are falling into the Debt Paradigm trap that chants the mantra “You cannot have what you need and want unless you borrow from others to get it.”
• · Second, your question seems to assume that assets produce income. Some assets do not produce income; your home, your car, collectibles, precious metals, and so on. Moreover, some assets that are supposed to produce income do not; GM bonds, most mutual funds, some real estate, and so on. In addition, the unspoken conclusion of that sentence seems to be that the assumed income from the assets would reduce or eliminate the debt created to acquire those assets. There are many Debt Paradigm shibboleths embodied in this conclusion. Mainly, however, the Debt Paradigm encourages having stuff you don’t own and owning investments you don’t control.

• o Other People’s Money – The Debt Paradigm would have you believe that borrowing from others is “arbitrage.” Not so. Arbitrage is the process of buying in one market and selling in another to take advantage of varying prices [Oxford Dictionary]. A money lender uses arbitrage when it borrows from savers and pays them 3%, knowing that someone else will borrow the same money from the money lender at 6% for a mortgage, 8% for a car loan, or 18% on a credit card. It is not arbitrage when one borrows from a money lender. It’s debt and a burden on the resources of the individuals and families that are borrowing.
• o Assets Increase in Value – No need to belabor this point today. The Debt Paradigm acts on the assumption that 1907, 1929-1942, 1973-6, 1979, 1982-4, 2002-3, 2008-20nn will never happen again or that the investor should only consider the long-term. DUH.

Let’s take a look at how the Money for Life Model for Creating and Managing a Personal Economy sees this issue.

The Money for Life Model for Creating and Managing a Personal Economy tells one to save from income. Saving doesn’t imply investing in a 401(k), IRA, or equivalent plan. We’ve all seen what’s been happening to the money that Americans ‘saved’ in those kinds of plans.

Saving means putting money in a secure financial vehicle that guarantees a reasonable return for as long as the money remains an asset of the financial vehicle. The Money for Life Model for Creating and Managing a Personal Economy calls these savings vehicles Money for Life Accounts.

If and when individuals and families using the Money for Life Model want to invest, they would borrow the money for the investment from their Money for Life Accounts. The loan would be made with the commitment that those accounts would be repaid from income on the same schedule a money lender would impose.

If the investment was a total bust and all of the money was lost, the loan would still be repaid and the Money for Life Account from which it was borrowed would be fully restored, including the earnings that derive from interest. The investment, in other words, would not have damaged the wealth and well being of the individuals and families that made it.

Many who follow the Money for Life Model for Creating and Managing a Personal Economy find it entirely unnecessary to invest in anything. They commit all of their money to building multiple Money for Life Accounts to assure that the Four Pillars of every successful personal economy are erected on an unassailable foundation of money that they control.

A commercial that is currently running on TV explains how easy it is for you to move your money from wherever it is now into “the investments you need” and the coffers of the company running the ad. It’s their way of saying “I’ll get you my pretty…”

The problem with this ad and so many others like it is that most Americans don’t need investments. Most Americans NEED:

• ~ to get out of debt
• ~ to save money so they can turn it into income they don’t have to work for and that they can’t outlive
• ~ to insure that they can pay the bills when the unexpected happens – and it always does
• ~ to teach those they care about how to stay out of debt, how to avoid the BS of the Behemoths about “needing” investments, and how to be their own bankers

I once asked agroup of small business owners what they would call a person who accomplished these four goals. I got several answers but the one that garnered the most attention – and laughs – was made by a woman that owned a drapery company: “I’d call that person” she said, “a figment of your imagination.”

She was and is wrong. Many Americans have discovered that being one’s own banker is a safe and sure way to achieve these goals – a way that is possible for everyone who chooses it. You can do this and Money for Life…in good times and bad gives you the roadmap, the tools and the guidance to do it.

SPECIAL OFFER! –> The paperback version of  Money for Life…in good times and bad – How to Thrive in the 21st Century will be released on May 1st, 2008. Everyone who buys the e-book version before May 1st will also recieve an autographed copy of the paperback when it is release. No special codes are needed. Don’t be an April fool; make the purchase befor April 30th. Shipping and handling charges will still apply. –> www.TheMoneyForLifeBook.com

The economy is in a slump. The housing market is in a mess. The money markets are in confusion. The typical American family has been led into a dungeon of debt.

Not so with the members of the US Congress. They are getting richer and now they want to raise your taxes. They say it’s a tax increase for the richest Americans.

The truth is, increasing the current tax burden on Americans will not affect the richest in a significant way. If you are earning a million or two or more a year – and there are many earning more than that – your lifestyle will not be dramatically affected by a tax increase. Yeah, you’d be mad as hell but you wouldn’t end up at the soup kitchen.

But, if you are a typical American family, you could be driven to the poor house by the irresponsible tax and spend US Congress. Here’s what you can expect if the unconcerned and politically motivated Washington elite get their way:

“Why this large tax increase? The tax code changes enacted in 2001 and 2003 are scheduled to expire at the end of 2010. If they do, statutory marginal tax rates will rise across the board; ranging from a 13% increase for the highest income households to a 50% increase in tax rates faced by lower-income households. The marriage penalty will be reimposed and the child credit cut by $500 per child. The long-term capital gains tax rate will rise by one-third (to 20% from 15%) and the top tax rate on dividends will nearly triple (to 39.6% from 15%). The estate tax will roar back from extinction at the same time, with a top rate of 55% and an exempt amount of only $600,000. Finally, the Alternative Minimum Tax will reach far deeper into the middle class, ensnaring 25 million tax filers in its web.” The Coming Tax Bomb, The Wall Street Journal, 4/8/2008 (emphasis added by the blog)

We do not have much to say about the workings of the US Government other than our vote. As powerful as that is, when you have an entrenched aristocracy like the one in DC, even the right to vote does not allow for dramatic changes.

It is incumbent upon each American to develop individual financial programs and practices to protect him or her self from the wild and unpredictable misadventures of the Behemoths – the Federal Government being one of them. There is a way.

You can handle your money and your personal economy so that you can be your own banker and exercise much greater control of the money that flows through your life. This way is clearly defined in Money for Life…in good times and bad.  

SPECIAL OFFER! –> The paperback version of  Money for Life…in good times and bad – How to Thrive in the 21st Century will be released on May 1st, 2008. Everyone who buys the e-book version before May 1st will also recieve an autographed copy of the paperback when it is release. No special codes are needed. Don’t be an April fool; make the purchase befor April 30th. Shipping and handling charges will still apply. –> www.TheMoneyForLifeBook.com

I read and/or review dozens of articles dealing with economics, saving, investing, and other money related topics every day. The article below illustrates that many financial writers are blind to the fact that the Behemoths they rely on for information create complexity where simplicity is warranted in order to sell more of their investment products.

I could write a dozen blogs just from the brief excerpt below, but I want to focus on just one clause; “…determining types of investments to make and knowing how much they will need to retire…” First, make note that the author addresses two different topics in just a few words; “investments” and “how much they will need to retire” – that could be savings, income, or just plain money.

You can’t spend investments. They will not pay your post-retirement medical bills (estimated at over $200,000), nor your probable long term care expenses (estimate to be over $350,000). Investments are based on a risk-reward algorithm not on your need for money to pay your bills. The Behemoths sell investments for money; investments are not money.

Investments may or may not deliver dividend income to pay monthly expenses. Investments in companies like Enron, Global Crossing, Qwest, MCI and other “highly recommended” stocks produced poverty instead of wealth. Mutual funds rise and fall with the tides of the markets and, if you need money at low tide, you’re just out of luck.

Investment “returns” are a function of assumed appreciation in value and dividends paid. Returns may or may not occur and may not translate into money or income when you retire. Retirement planning is a shibboleth perpetuated by the Behemoths so they can sell you more investments.

What you really need is a system for managing the money that flows through your life; a system that works all the time instead of the robotic thinking that goes into “retirement planning” and assumes that the process is complete when you reach the magic moment of retirement.

The retirement planning model doesn’t work. You need “a bigger boat.” Money for Life as a better alternative to the myth that there is such a thing as retirement planning.

SPECIAL OFFER! –> The paperback version of  Money for Life…in good times and bad – How to Thrive in the 21st Century will be released on May 1st, 2008. Everyone who buys the e-book version before May 1st will also recieve an autographed copy of the paperback when it is release. No special codes are needed. Don’t be an April fool; make the purchase befor April 30th. Shipping and handling charges will still apply. –> www.TheMoneyForLifeBook.com

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“Affluent and Non-Affluent Find Similar Roadblocks in Retirement Planning

By Stacy Schultz  

April 7, 2008

A quarter of Americans have not yet started planning for retirement, according to a new survey released by Bank of America.

The study of 1,000 interviews surveyed 750 nationally representative Americans and 250 affluent Americans (with $100,000 to $3 million in investable assets). Both groups identified two key areas of confusion about retirement planning: determining types of investments to make and knowing how much they will need to retire. However, non-affluent Americans also cited when to retire and how to start planning as difficulties.”
Read the rest here –> http://www.financial-planning.com/asset/article/563421/affluent-and-non-affluent-find-similar-roadblocks.html?pg

Jim and Janet have no children and they still struggle at age 40-something to save and invest enough to secure their financial future. They were presented with the opportunity to buy their first home three years ago by one of Jim’s friends who was in the mortgage business.

They were convinced that it was a deal that could not lose;

• no money down
• low monthly payments for two years
• extra cash at closing to pay off some credit card debt and, most of all,
• the assurance by the mortgage seller that the worst that could happen if the payments got too burdensome would be that the house would have appreciated in value and could be sold for a profit.

Jim and Janet were feeling lucky. They took the deal. Today the house is worth less than they paid for it, the payments are unaffordable, the credit cards are maxed out again and selling the house in a neighborhood where over 40% of the homes are already in foreclosure is nearly impossible.

Jim and Janet have an alternative that most don’t have. They have no children. Because of that Jim and Janet are both seeking part time work to supplement their income and to avoid foreclosure and probable bankruptcy. Not a pleasant situation.

The Behemoths and their minions have convinced millions of Americans that owning a home at any cost is worthwhile.

BUNK!

Had Jim and janet adopted the principles and practices of Money for Life, they would not have prematurely bought the house. They would have started a “bank,” paid off their debt and saved money for a down payment. Had they done that, they could today buy a home in a solid neighborhood for a good price, with a low interest conventional mortgage, for payments they could afford now and into the future. Jim and Janet are not alone, however. The exerpt from US News and World Report below demonstrates this.

If you would like to avoid situations that can create financial difficulty for you and your family, I encourage you to take a look at www.TheMoneyForLifeBook.com and take advantage of the FREE white paper. Or better still the SPECIAL OFFER! –> The paperback version of  Money for Life…in good times and bad – How to Thrive in the 21st Century will be released on May 1st, 2008.

Everyone who buys the e-book version before May 1st will also recieve an autographed copy of the paperback when it is release. No special codes are needed. Don’t be an April fool; make the purchase befor April 30th. Shipping and handling charges will still apply. –> www.TheMoneyForLifeBook.com

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“Buyers are well-informed and rational. Investment vehicles might be remarkably innovative, but consumers seem to be as gullible as ever. It’s obvious now that some home buyers over the past few years took out loans far beyond what they could afford, with foreclosure probably inevitable even if house prices had continued to rise. But even people who consider themselves financially literate aren’t so shrewd. A 2007 study by the Federal Trade Commission, for instance, found that:

— 20 percent of borrowers looking at mortgage disclosure forms couldn’t identify the interest rate amount

— 24 percent couldn’t tell which loan was less expensive, when looking at two different applications

— 30 percent couldn’t tell if the loan included an expanded “balloon payment” at some point

— 44 percent couldn’t tell if there was a prepayment penalty for refinancing within two years.”

Excerpred from U.S.News & World Report
4 Subprime Myths That Could Derail Reform
Friday April 4, 1:56 pm ET
By Rick Newman

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Jonathan and Stacey have an unconventional family. Stacey is a highly compensated executive and is rising rapidly in her profession. Jonathan is an innovative and creative artist. Jonathan stays at home with the couples two children, works on his art when he can and dabbles on eBay as a way of making a few extra dollars to feed his passion.

His eBay adventure didn’t start out as an avocation, however. Like many other easy money schemes such as multi-level-marketing programs, foriegn exchange trading, precious metals deals, or day trading on the stock exchanges, it began as a fantasy about a fortune. It wasn’t long, though, before Jonathan and Stacey both recognized that success was unlikely. When Stacey became pregnant with their second child – well, that sealed the deal on the role of eBay in their financial future.

Reality and common sense tell us that there is no such thing as “easy money.” There are ways of making money – like those mentioned above – that are particularly suited to certain individuals; that are fulfilling, fun and rewarding if you and that way of making money are compatible. If your personality, skills and psyche are not in synch with a particular profession or business opportunity, failure is assured.

You might make a lot of money, but it won’t be easy, you’ll not be happy, and eventually you’ll find a way out of that situation – drugs, infidelity, alcohol, eBay, fishing, golf or some other distraction. The same holds true for financial practices. We all have two professions; one is the career of our choosing; the second is being our own banker and managing the money that flows through our lives.

Many individuals and families ignore their second profession or see it as a nuisance. That’s because their personality, skills and psyche are out of synch with the way they deal with their money. Americans have been led to believe that their personal economies are best served by “plans” devised by Behemoths – large, publicly owned financial institutions. Those “plans” are the counterparts of the quick and easy money schemes.

It is no more valid to expect to succeed using the standardized robotic thinking that goes into such plans, than it would be to expect every American to succeed on eBay.

There is a better way for you to take control of the money that flows through your life, a much better way; one that is adaptable to every American and to every situation; one that is based on principles and practices that have been known to the money-wise for millennia and practiced by financially successful Americans from the days of the Founding Fathers until today.

You can learn about this amazingly simple and effective approach by following this blog for a year or two or you can spend $29.95 and buy a book that will tell you most of what you need to know to debunk the bull of the Behemoths and escape the Dungeon of Debt they have built for you.

The Book? Money for Life…in good times and bad – How to Thrive in the 21st Century

SPECIAL OFFER! –> The paperback version of  Money for Life…in good times and bad – How to Thrive in the 21st Century will be released on May 1st, 2008. Everyone who buys the e-book version before May 1st will also recieve an autographed copy of the paperback when it is release. No special codes are needed. Don’t be an April fool; make the purchase befor April 30th. Shipping and handling charges will still apply. –> www.TheMoneyForLifeBook.com

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In the meantime, if you’ve just found The Money for Life blog we encourage you to read some of the previous posts and the separate pages listed on the right to familiarize yourself with the wealth of information and insights about money, saving, spending, investing and other topics that can help you manage your personal economy.

You may also want to take a look at this SPECIAL OFFER! –>

The paperback version of  Money for Life…in good times and bad – How to Thrive in the 21st Century will be released on May 1st, 2008. Everyone who buys the e-book version before May 1st will also receive an autographed copy of the paperback when it is release. No special codes are needed. Don’t be an April fool; make the purchase before April 30th. Shipping and handling charges will still apply. –> www.TheMoneyForLifeBook.com

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John and Marion’s business is just beginning to pay off after two years of struggling to get started. Unfortunately, their business is not recession proof so making sure their personal economy is prepared for the negative effect a major slump might have on it – and them – is critical.

When the economy gets bumpy, there are two of the Four Pillars to which you need to pay close attention; freedom from debt and having ready cash to deal with the surprisingly unsurprising surprises that life sends your way. This is especially true for small business owners who rely on cash flow more than the employed worker.

John and Marion have decided to re-organize a few things to assure liquidity if a down-turn affects their personal economy to a greater extent than they anticipated.

• ~ First, they refinanced their home at a significantly lower interest rate, so their monthly payments remained about the same.
• ~ They also “harvested” an extra $20,000.00 of equity from the refinancing and used that money to eliminate all of their other debt – mostly credit card debt – freeing up several hundred dollars each month.
• ~ That leaves them with just one other debt to repay; a loan they made to themselves from the cash values of their life insurance policies. This loan will be eliminated quickly using the extra cash flow. This will restore the cash values in their policies. These values are guaranteed to grow every year regardless of what happens in the general economy and become the family’s and the business’s first line of defense against life’s surprises.
• ~ Their mortgage then becomes their only debt.
• ~ They also obtained a $100,000 equity line of credit today that they may not be able to get later. Should the business encounter “a bumpy night,” and their business or their personal economy requires it, John and Marion can tap into their HELOC.

There is one aspect of John’s and Marion’s personal economy that would be troublesome in a severe recession; their investments. Most of the money they have invested is in mutual funds that could lose significant value in a recession. The couple has decided to watch their mutual funds and the market more carefully in the months ahead and to move the money into cash or cash equivalents if the values begin dropping a lot.

Their mutual fund sales rep suggests that they should ride out the “bumpy night” and that the market will rebound – eventually. John and Marion believe that they would rather lose the potential for an eventual gain in return for a smaller guaranteed one today.

Money for Life…in good times and bad taught John and Marion the strategy that armors them against recessions, depressions, inflation, deflation or stagflation. Ask yourself whether or not that strategy makes as much sense for you as it does for them. If so, then take advantage of this…

SPECIAL OFFER! –> The paperback version of  Money for Life…in good times and bad – How to Thrive in the 21st Century will be released on May 1st, 2008. Everyone who buys the e-book version before May 1st will also recieve an autographed copy of the paperback when it is release. No special codes are needed. Don’t be an April fool; make the purchase befor April 30th. Shipping and handling charges will still apply. –> www.TheMoneyForLifeBook.com

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Thanks to all that have come to visit. Thanks to the many who have bought the amazingly groundbreaking e-book.

On May 1st the paperback Money for Life…in good times and bad (sorry about the fuzzy cover image) will be available on the blog and from the author at www.YouBeTheBank.com

If you have found value and perhaps a little entertainment here, tell a friend or two; ask them to visit and take advantage of the special offer made on April the 1st…see below.

                SPECIAL OFFER! –> The paperback version of  Money for Life…in good times and bad – How to Thrive in the 21st Century will be released on May 1st, 2008. Everyone who buys the e-book version before May 1st will also recieve an autographed copy of the paperback when it is release. No special codes are needed. Don’t be an April fool; make the purchase befor April 30th. Shipping and handling charges will still apply. –> www.TheMoneyForLifeBook.com