I’ve got following few things I’d like to get down to this year:

• build passive income – in Q4 2015, I’ve started purchasing few stocks, I’m aiming to hit average 100$ monthly passive income as average for 2016 and that is not going to be possible with just stocks, because I simply won’t have enough free capital, that’s why I need to find a way to acomplish this.
• learn 3rd language – it’s going to be German or Spanish, ideally I’d like to achieve something like B1 level, this also requires consistency and not being lazy
• workout regularly – I’d like to lose some weight and get myself into shape a little and for that, I need to be consistent in workouts, not hoping for anything drastic, but I was pretty slim all my life so far and it might not be true in soon future, unless I do something about it
• start studying MSc, simple as that, I think it could be useful to me at certain point in life and I’m smart enough to have an education, if I’ll be consistent enough, it would be no problem at all.

These are 4 highlighted tasks I’d like to achieve apart from my debt reduction/spending habbits goals and for all of these I have to learn how to be consistent and that will apply for this “blogging/writing” thing as well, so let’s see what the time brings.

NetworthMaker

I did it again, nearly 3 months radio silence. I’m sometimes wondering when/if I’ll be able to change these manners. But since I’ve improved many things during 2015, I don’t see a reason why it couldn’t apply for frequent writing as well. Old habits die hard and so I’d say that’s primarily all of this is about – me having problems doing things consistently.

Talking of old habits, Q3 – terrible results, my “moronness” got into the way and I’ve lost most of what I’ve saved up and barely paid off any debt. Q4 on the other hand, that was bit different cup of tea. I’ve got additional income from extra hours, I’ve been spending at work, which made a big difference. On top of this, I’ve finally got my pension account setup, where extra 3% of my salary flows every month, this helped me start building some asset base. Because my “Assets” were crazy ride, up&down and I’d like to work on stabilize them with sustained growth.

56.3% is the magic number for 2015. That is the percentage of how much money I’ve saved up, not that I saved it all up, 90% were used to pay off as much debt as possible. But still, I brought home more than half of my total income, leaving my expenses at 43.7%, which I think is pretty great. For this year, I’d like to settle in 35-40% range for my expenses, because I am very well aware of few months, where I could have spent much less than I did, therefore I believe below 40% is pretty realistic.

Debt Change Assets Change Assets
Q1 2015 -5.48% 0% 600$
Q2 2015 -6.07% +126.67% 1360$
Q3 2015 -0.95% -85.88% 192$
Q4 2015 -6.07% +884.83% 1890$
In total I paid over 12.800$ this year, out of which 4.800$ was purely interest. My target for this year, was to pay off 8.000$ which I exceeded by extreme amount of 2$ :-). I’m quite happy with it, especially when considering how Q2 turned out. But still this huge chunk of interest made me bit annoyed from time to time, but looking at it now. I’m the type of person, that usually doesn’t learn a thing, when going is easy. I have to be under enormous pressure to come to the point of self-realization and that’s what this debt story is about. But wind of change is hopefully coming. Before X-mass I visited my dad and one thing led to another and I told him everything about loans and how much I’ve been paying off etc. He was mortified a bit at the beginning, but then he asked me, “Why haven’t you asked your mom for help?”. She owns a property or two and could therefore help me by getting a mortgage. The thing is, in my opinion, she’s already aspiring to be called holy Yvona, already throughout duration of her life and she does so much, that I didn’t want to cause additional problems to her and since I’m the one who messed it all up, I wanted to be the one to fix it.

So I told my dad, that I’ll sort it out on my own and next thing you know, my mom calls me up, saying that she heard, that I have some problems and that she’s going to help me if needed. So we’re currently in the middle of trying to sort things out and if that happens, my interest rates are going to be around 3.5% p.a. instead of average 18% at the moment and that is just insane improvement.

So I’d say…

Wind of change is coming.

TTYL

NetworthMaker

after a long break, which wasn’t all that intentional, I made myself write something, since I wanted to be consistent in writting articles. Which I obviously didn’t live up to. So here I am, doing another one. I figured I can start by sharing the results for my Q2 and Q3 comparison when it comes to networth and debt.

Before I write the actual figures. Q2 was really good for me. I’ve managed to make pretty good amount of money on lots of things and lowered my debt by more than 5% and increased my savings by 126% at the same time. That was simply magnificent, but then Q3 came along with my birthday and I was overwhelmed by previous results, so I started overspending and investing(or rather speculating) way too risky and lost majority of the savings, I did use some of it to pay off some additional debt, but in total it was just 1% for Q3 and my savings dropped by 85.88%. Therefore pretty bad result, all in all, I managed to go on holiday over this period and enjoy myself a lot, so at least I got that tiny 1% debt reduction. Since September, I’ve been again working my ass off and kept trying to fix what I can, hoping for strong finish in Q4. I would personally love to hit 5% again.

This is it for quick summary and I absolutely have to kick myself into getting next article much sooner.

TTYL

NetWorthMaker

With a decent delay, I managed to get myself to bring the May 2015 report, why the delay? Partially because I was quite busy, but also due to procrastinating. So, how would I summarize May?

“Oh man!”

I’ve managed to get very high earnings in the first 2weeks, only to ruin it on overtrading, I’ve actually taken out 500$ from my affiliate account, then I’ve withdrawed 400$ which were initial deposit to Networthmaker pamm account and I was still left with 1k$, which was purely profit and then what happened? I started behaving like a mindless moron and traded short 0.5lot of gold, which consequently closed my pamm account and 1k$ profit was gone. I was glad that I’ve managed to secure at least that 500$ profit from affiliate account. Therefore it wasn’t that bad, but I’m mainly dissapointed in my discipline, which again proved to be very unstable. This brings me to the new goal! More discipline, less chasing astronomical % profits.

Out of those 900$ that I’ve withdrawed I used 700$ to lower my bad debt as a punishment for my misbehaviour! On top of that paying off a bad debt is always a good thing. Therefore now, I’m again going to be starting from a zero. Let’s hope that I won’t mess up next month. Let’s see the current breakdown:

Current breakdown:
Affiliate account: 120$
Savings account: 40$

Total assets for 05/2015: 160$

What does PAMM stand for ?

Profit Allocation Money Management. For better understanding, it the type of account, to which anyone who registers can invest money and then be of this account from certain percentage. Meaning, let’s say I invest 500$. Should anybody else invest another 500$, there’s going to be 1k$ to invest and we share a profit or possible losses.

Why PAMM account ?

As I mentioned above, PAMM accounts are publicly observable and transparent. I want to be as honest as possible and PAMM account sort of does the trick. Another aspect is, anybody can chip in to increase the profits on both sides and also I’ve registered for MQL5, which allows anybody to copy my trades for 20$ per month.

On top of this, I’ve registered this account as my refered accounts with InstaForex, therefore I’m getting little bit of a commission for every trade I place. This money would normally stay with a broker, therefore there’s no reason why to not use it.

Trading style

My main trading style will be, price averaging, less speculations and more investing. Hopefuly I can live up to that.

Summarize

1. Affiliate reg. – commisions from every trade I place, that goes to separated account, creating a backup pool of funds for drawdown periods.
2. PAMM account – potential to increase profits, transparency.3. MQL5 reg. – potential to increase profits from subscribers

With these perks, if successful, one does not have to trade with some insane success rate, but still can make a decent profit. Points 2 and 3 are optional, but point no. 1 shouldn’t be overlooked by anyone.

Goals

Stage I – 1.000$ – with both deposits and potential profit I want to reach 1k$. Ideally by the end of May.

Stage II – withdrawal time – after reaching over 1k$, I want to withdraw all the money that I’ve already deposited and use them for different projects. With a target at end of Q3 2015.

Stage III – diversify – once only profit is left on the account, I will keep withdrawing any profit above 1k$, until this account is worth less than 20% of my total assets. At the same time I will no longer be withdrawing from my affiliate account, until reserve of 500$ is made. Target – end of 2015.

Stage IV - time to grow – Once stage III will be finished, I will grow this account to 5k$. Target for 2016. While along the way ideally having Networthmaker Pamm account as 15% or less of my total assets. With tendencies to reach 10%.

Thanks for reading. Please if you have any suggestions or comments, please feel free to add them.

Till next time

NetWorthMaker

I’ve startered saving up some money at the beginnig of March and created PAMM account with InstaForex broker, to which you can see the ad at the right side of the website.

https://www.instaforex.com/cz/forex_monitoring.php?trader=5344509#/

I’ve also created this account as a referal on my own affiliate account, therefore everytime I make a trade, I get a small commission from it, which would normally stay with a broker. After that I’ve registered this account at MQL5.

https://www.mql5.com/en/signals/95126

MQL5 has this great feature, where you can “copy a signal”. Simply put, every trade I place, you can copy, for 20$ a month and to my surprise, I’ve even managed to get a first subscriber during April.

With that being said, first whole month of trading has condluded and I’ve managed to “pimp out” my Networthmaker account to 750$ and I also managed to reach 400$ on my affiliate account.

For the upcomming month, I hope to reach 1000$ on my pamm account and keep this level as a standard. Then I want to keep withdrawing money, until I’ve withdrawed everything I’ve invested. This money will then be part of my reserves in my country currency (CZK) and another part will be used for stock investments. I’m also going to withdraw the funds from affiliate account and use it as an extra payment for my debts, because that’s always useful. Therefore I expect total assets to drop a little bit during this month. Because I have a rapid debt removal plan in place

Current breakdown:
Networthmaker pamm account: 750$
Instaforex affiliate account: 400$

Total assets for 04/2015: 1150$

Thanks for reading!

NetWorthMaker

In early days I was strongly convinced that if you believe in something, it’s going to become a reality, no matter how difficult or improbable it may seem. But over extended period of time, this unlimited positive thinking, while being tested by lossing streaks and something that is generally being call as a “bad luck”, I was forced to start thinking about whole concept of this never-ending positive attitude, which at the end, seems insanely dangerous. In some ways, I was practicaly brainwashed, because I believed even though I failed once, twice, or 20times, it was going to be different with that 21th case. That is obviously indulging wishful thinking and by now I believe it doesn’t have anything to do with real positive thinking, but is more likely way to hell. Because there’s no difference between this kind of behaviour and gambler, which believes that biggest winning streak is rights outside the doors.

Where does the acknowledgement come in ? At certain point in time I realized that my life sucked and it was going to suck much much more, unless I turned things around. I’ve experienced countless sleepless nights while thinking of what went wrong, so many days at work on an autopilot mode while trying figure out, what was it that I was supposed to do. Basically I Was trying to avoid giving up, but I kept making same mistakes over and over again. Then I stopped smoking and it was like a first tiny rock that started an avalanche. I had all the ideas what should I improve or change about myself, but I was just not able to act on it. Only after I got rid of cigarettes I stopped being too lazy or alibistic and I was only able to do so, thanks to acknowledging that reality was dire.

When I accepted the fact that I was being, lazy employee, bad boyfriend, stupid investor, unreliable friend, practically everything I’ve always fear I could be, I managed to apologize for my behaviour. I started making up for previous mistakes and flaws and got myself “back” on road to success. Why the quotes ? Because I honestly believe that this is the first time I actually stumbled upon the right way towards success and happiness.

What about you ? Do you have some interesting experience with acknowledgement ? If so, please share below!

We spent firt 20-25 years of our lives by studying, so that we can get a proper education which leads to a well paid job.
Yet after commiting that badly to a money earning process which should ensure our financial security and prosperity, whole wide world starts dragging us to a dangerous waters of loans, credit cards, overpriced luxurious goods, cars and generaly bad debt.

Vast majority simply isn’t ready for something like that. If I take a look at people that surround me, at least 75% earn more then average, yet they do nothing to build a networth. Nobody is trying to invest in any way. Only way these people have some money, it’s in a period of time when they are saving up for something needless, like vacation, new car etc.

Current median wealth for my country is 15.541$.

At a time, I’ve highly sympathised with his opinion of educational system being close to useless, but I believe that’s quite dangerous message to be shared publicly throughout the book as it can easily corrupt young minds. In some ways it opens them up and pushes a little bit towards thinking outside of the box, but simply put, not everyone can be wildly successful businessman that drops out of colledge and becomes a billionaire. While pointing out few of those that were able to become rich selfmade is in my opinion very similar to investing in IPOs. Everyone is hoping to hit next Microsoft and surely sooner or later, many will manage to do so. But for every Microsoft, there are thousands companies that went broke or just didn’t make it.
All in all, I believe this book is very helpful to a certain group of people. Especialy for those who live in post communist countries like myself, where financial education still highly strugles. It has a potential to adjust your mindset in a right direction. Because it’s no coincidence that poor people save on average less then 5% of their income, while rich group saves more then 15% of what they earn. After that what happens to 5% savings of already poor people ? Majority of it usually sits in a bank account where it slowly waits to be eaten by inflation and at the end of the day, it becomes a down payment for a car.
This is one of the aspects that book Rich Dad Poor Dad is trying to illustrate.

Overall I’d summarize useful lessons into following:

Lesson 1: Rich do not earn money on transaction basis
What I mean is, Rich person usually doesn’t just go to “40hours a week” work. While making their way up, they work all the time. But that’s not all, they simply do not trade time for money, but rather work towards more distant goal which carries potential of ideally permanent passive income. What would you rather earn for 1hours work ? 100$ right now, or 5$ a day for next year ? Poor mindset will go for 100$ and spend them right away. Wealthy one shall save up as much as possible out of those 5$ and reinvest.

Lesson 2: Work to learn – don’t work for money!
With this lesson I have to mention again. Simply not everyone can be rich and this theme may be little bit offensive to 9-5 working people as they are being referred as sheep or rats etc. This lesson may be misunderstood for some, I believe logic behind this is that one should first build a proper education and we are not necessarily talking about getting university degree just for a sake of having a degree. But rather let’s say I would like to run a a store that sells shoes, I could either work for money and try to make as many sales by myself, to maximize short term income or I could focus on learning myself how to go about minimizing my expenses, increase the brand publicity and other aspect of the business, which if done properly would result in better results if done properly.

Lesson 3: Rich sell ideas
Breath in life to your ideas. That is THE one of the fastest ways to become super-rich (if you succeed!), prime example in world be Mark Zuckerberg with Facebook. You simply cannot match wealth of richest people by being employeed and that’s where creating your own business ideas come in.

Lesson 4: Rich do not spend needlessly
You can see it very often, they argue about monthly price for their internet, driving cheap car while wearing only pair of jeans they own day after day, simply living as if they weren’t rich at all. That’s one of the fundamental principles how you have any chance of building any real wealth in your life in a first place. In my country on the other hand, it seems to be national sport to overspend and take as many loans as you can take and then just complain about your financial struggles and pass on blame to government, middle east, financial crisis, pretty much anything that presents itself. That’s why there are so many financial predators and I mean ofcourse the companies that do micro loans, short term loans with interests ranging from 20 up to hundreds of percent per year. If there was any financial education what so ever, these companies would cease to exist.

Lesson 5: Spend wisely
This is the point I strongly agree with. Financially healthy individual should not be spending their hardly earned paychecks, but rather invest as much as possible into assets, that have the possibilty of generating additional income.

Verdict
From my point of view, this concludes main lessons. After reading few other books from same author, I came to the conclusion that this is probably only book that is worth reading (possibly also with Cashflow book). Overall I’d recommend reading this book to somebody who does not have a lot of experience in the field.

thank you for stopping by. I’d like to tell you my story. Before I get started, please excuse my grammar mistakes, English is my 2nd language and considering I have dislexia, there might be an error or two despite autocorrect function. I’m white male in mid 20s, living in central Europe, who strived to become financialy independed since early teens. Along the way, I have made some wrong turns here and there which led to terrible decisions and those got me into pretty bad finacial situation. Luckily, I was able to maintain well paid job, thanks to which I was able to survive throughout my mistakes till recent day, but without fundamental changes in my life, I would probably become homeless, before I’d be 30.

How it all began? Let me tell you a little about my background. Please note that I am aware that it is going to sound like I am pretentious prick, but those who get to know me a little understand that it’s justified. I may be a moron and an idiot once in a while. But when it comes to things like numbers, critical thinking, quick decision making etc. I fit in genius category quite well. Ever saw one of those math kids on the TV, that can tell you whats whats square root of 15 multiplied by 37 divided by 5 ? Well I am one of those. When I was 5 years old, I was able to count compounded interest on an investment over certain period of time, without ever seeing the formula, it clicked in my head and I just knew how to count it.

I am the one that people turn to when they need help. Worst part is, that I never followed advices I was giving in the first place. I did a budget for people, explained to them the importance of regular savings, regular investments. How SUPER IMPORTANT it is for a young person to start saving early, because it makes such a huge difference. That’s what I was telling people as early as I was 17. Yet at age of 24, I got to the point where I had zero savings and tons of debt, with awfuly high interest rates and despite me being a smart-ass, I just kept wondering what the… is happening?

How the hell is that possible do you ask? There is quite simple explanation, I was somewhat lazy. My friends like to say that I don’t give a **** about anything. That is not really the case. I did care, I was stressed out about many things, I just didn’t do anything about it, therefore the impression that I was giving to the world was quite clear. At the end of the day is there a reason between not giving a toss and caring yet not acting on it ? Reason for everything bad I brought to my life was being lazy. I always loved telling somebody definition of insanity (Doing something in a same way over and over again and expect different results). Is it surprising by now that I always caught myself doing the same stupid things over and over again ? I actually thought to myself “this time it’s going to be different”. For no logical reason, just because I thought I can be better than everyone and that same rules doesn’t apply to me. What can I possibly say to defend myself, there’s nothing like having certifications for 160 IQ points and acting like a stupid crazy person!

Hitting rock bottom. In mid 2014, I had so much outstanding payments, that 3salaries wouldn’t cover all of it and i owed to many of my friends, my mom, banks, utility providers, phone company, simply EVERYONE! It felt as if I had a disease, I couldn’t sleep properly, couldn’t eat, I had crazy mood swings until one day. I decided that’s enough, but where to start from? By that time, my self-esteem was pretty low and when I did some calculations, it was quite unlikely that there could be some light at the end of the tunnel. But I had to start from somewhere and then it crossed my mind, I wanted to stop smoking for quite some time, but I just never tried to quit because of sensible reason, I didn’t mind it that much before. Everyone gets to the point where we are postponing something in some cases putting it off indefinitelly. For a desperate and lazy person, the best way that I found was to start by not doing something. Meaning, by doing absolutely nothing (not smoking) getting positive results of saving quite a bit of money and doing something for myself. I’ve always thought that successful person does not smoke, yet I did smoke for 7years and didn’t give a crap about it. But quitting was the first stepping stone for me and knowing how much depends on it, I haven’t smoked since.

It’s all in your head! Once I’ve stopped smoking, I saw how much money I was needlessly throwing away, following steps just started reveal themselves. I optimalized bank products, lowered utility charges, internet cost, started paying bills on time, sold my car as I live 5minute walk to work. All in all I started saving roughly 35% of my salary every month since then! Which is HUGE! With this newly accessible income I started paying off small loans. Started creating a little emergency backup fond, changed a way I was “investing” and figured I want to share this road with someone and that’s where this blog and you come in. Next stages for me are to increase earnings as 71% of my income goes towards either savings or debt pay off and it would seem I cannot live off less then 29% of my salary.

This is just the beginning of something great and I couldn’t be more excited to share this with you.

NetWorthMaker