Not Made Of Money

I didn’t post yesterday because I spent a lot of time reading other blogs.  There were so many insightful posts that really resonated with my own current thoughts. 

I really enjoyed Where Does Cynicism Fit Into Your Portfolio.  With maturity (read getting older and hopefully wiser) I’ve come to the realization that when it comes to money matters, it is prudent to watch out for the “spin”.  There are no guarantees in life and what can be “recommended” as a good investment move now, may not be so good in the future.  It is wise to always evaluate your options and know that for every potential “benefit” there is a potential “risk”.  

An example from our own life.  A few years ago my husband and I were seriously considering some real estate investments.  Specifically, we were thinking of finding properties in need of repair, investing money in them to fix them up, and then reselling them for a profit.  We’d found several homes in our local neighborhood that were just perfect for this.  We would have needed to finance some of the properties but were willing (and able) to put our own money into the projects.  All the “experts” were saying this was a great move for us.  We crunched the numbers every which way.  The potential profit was grand; the potential risks seemed well within our margin of comfort.  Still, there was something that just didn’t “feel right” about it and so we decided to put our plans on the back burner for a while.  Guess what happened?  About 4 months later the State of Florida was hit with 3 hurricanes in a single season.  Our home was hit by all three of them and while we did pretty well as compared to others, we had some damage to our home.  If we had owned other properties it would have been a disaster because not only would those other homes have needed repairs made from the hurricanes, but it was virtually impossible to find contractors to do any work.  We made some of the repairs to our own home but had to wait months to find contractors to do the needed repairs.  Even a year after the hurricanes hit, there were homes in our area with blue tarps covering the roofs.  Lesson learned:  Always plan for the unexpected because there is a small chance it could actually happen. 

I also liked Do I Need To Report This Income (Part I) and am looking forward to reading part II.   We’ve never had a difficult time discerning taxable income.  We don’t have income from a wide variety of sources, so it has been easy to decide that income is income.  For us the question has been “Do I need to tithe off this?”

What Is Your Plan B? Do You Even Have One? is a post that really hit home.  I am a big advocate for having a plan B and working it aggressively.  For me it goes hand-in-hand with reality.  Things can and will go wrong.  Even if you don’t have a working plan B, at least plan for what you would do.  If you lost your job today, how would you go about finding another?  Have a resume ready to go.  Make a list of contacts you could call.  What companies would you apply to?  Do you have an emergency fund set up and how long would it last?  These things are all part of a Plan B. 

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