Personal Finance Fails (eBook)

Nathan Welch (Autor)

eBook Download: EPUB

2019 | 1. Auflage
180 Seiten
Bookbaby (Verlag)
978-1-5439-7747-9 (ISBN)

Infos

Life's financial decisions are difficult. Have you found it challenging getting this information through to others or found other finance books boring? This book takes a different approach to setting the boundaries of personal finances. This book is just like the fail videos you have seen on YouTube! You will learn what not to do, or at least what could happen. This is the account of real people's, life changing, financial fails. Learn from them... so you can avoid them!

---

You may have seen and enjoyed watching fail videos. When my children were little, we spent a few minutes of our bedtime routines watching fail videos on YouTube. Don't judge, the impact of the learning from these videos was powerful. They learned that slopes and skateboards can result in bruised knees or worse, broken legs and wrists. Interestingly, they don't have an interest in skateboards. Financial fails are not as easily captured on video. Even so, they can elicit the same intense expressions and learning opportunities. If you have found other finance books boring or it has been hard to reach others with personal finance information, then this book is for you. This book takes a completely different approach to teaching personal finance. The financial fails in this book are not so far out of reality that they will never occur. They are close to home and can happen to anyone. All the major phases of life are detailed throughout this book. This will teach you, or at least confirm, that you have navigated life's financial decisions successfully, avoiding debt, and not ending up in a fails video or in this book!

Textauszug

Chapter 2

Personal Finance Fails

Life’s Financial Literacy

 

It was my first day of work as an intern. I took a shower, got dressed up, and was eager to learn about the company. I was hopeful this experience would land me a job upon graduation.

Here is the thing… The most rememberable interaction was with the manager and his side hustle. You see, he was an investor, an entrepreneur of sorts. What was to come next has never been forgotten.

To maintain confidentiality, no real names in the real-life scenarios were used. Again, these are real people’s, real life, personal financial fails. Our goal here is to learn from them.

Here I was, my first job as an intern. I was a little nervous, but more excited than nervous. It was the Twin Cities, so I felt a little success when I found the proper place to park! As I moved from the parking lot to the building all my senses were alert, soaking everything in.

I headed to the front desk to check-in. I could see a curved administrative desk, off in the distance, but it appeared to be empty. As I looked closer, I could see that someone had recently been there.

A steaming cup of coffee was sitting to the right of the keyboard. The chair was pulled from the desk and rotated outward as if the person sitting there had to go somewhere quickly. As I was absorbing all this, there was higher pitched man’s voice that came from around the corner, “You must be the intern!”

Oh man, here it goes. He was moving fast. I took a step forward to greet him. As he moved in closer, I could tell he was a shorter, well dressed, and a very high energy type person. There was so much cologne or body spray that it made my eyes water. It turns out this was Anthony, the site manager.

We ended up going to his office. His office was nice, you know, the big desk, chairs, and even a couch. He was a very experienced individual. This wasn’t his first job, rather he was on the last quarter of his working career. Anthony had worked at other Fortune 500 companies and even held a few Vice President positions.

The entire time that I knew him, he was well dressed and well spoken. He never broke this mold. He always looked, to me, as a banking executive of sorts. You know the type, pressed pants and everything but the pocket protector.

I would approximate his age around 50 years old at the time. Plenty of time for life experiences and plenty of time for more life experiences. One day at lunch, he was telling me about his most recent investment. I enjoyed learning about investments. I wanted to be an investor someday. First, I needed a job that paid me money!

Anthony’s “side hustle” required a sizable investment of $120,000 dollars. This was more than I could comprehend at the time. I was still trying to figure out how to scramble up some money to go out that night. Remember, I was in college. Nonetheless, to some, this may not sound like much of an investment, but keep in mind, this was $120,000 dollars in 2002.

There is usually always a reason why people make investments. For Anthony, this was an investment to help fund his children’s college. I was just finishing college and knew this would be a good idea. College is simply expensive. It is now and was then.

Since this was for his children’s college, I was thinking and expecting this to be a safe investment. You know, investments with low down-sides and more perceived up-sides. I mean, who would want to gamble on their children’s future educational expenses?

The investment was tangible, something the size of a pinball machine, recliner chair, or for the younger generation, something the size of a Segway. Anthony didn’t just invest in one of these things, he purchased eight of these glorious machines!

Part of his investment also included the zip code rights to place more of these machines. I was intrigued, this was a lot of money, these machines must be something novel. I wanted in on this investment. I had no money, but you know what I mean, I was intrigued.

A few weeks later, I learned that he had brought a few of these machines in on a trailer. His plan was to place them at their intended location after he got done with one of his meetings. At this time, I wasn’t sure what these machines were. I didn’t know if these were factory type machines or office equipment.

As soon as I could, I headed to the front of the building to get a look out the window. I was eager to get a glimpse of the machines on the trailer. I was hoping it was a flatbed trailer. This way I could see what these machines looked like and what they could possibly be used for.

There it was, his Mercedes was connected to an enclosed trailer. Of course, it’s an enclosed trailer! Could this be any more vague, secretive, or un-real?! Just my luck, you couldn’t see a darn thing! You may be wondering, why I didn’t just ask? You see, I was the intern and my face time with Anthony was very limited.

Finally, he asked me if I wanted to see his machines. Oh boy, you know I did. We exited the building and made our way to the far side of the parking lot. As we approached, I could tell that his Mercedes and trailer were uniquely parked.

He undid the padlock and rolled up the lift gate to the enclosed trailer. My heart was pounding. I looked in and couldn’t believe what I was looking at. This must be a freaking joke! It wasn’t a machine! It was a computer with a bunch of plastic around it. It was like an old school Pacman arcade game.

It was a plastic stand about four feet tall with a computer tilted up. Over the computer was an overhang, something to reduce glare, or privacy, I suppose. Literally, just like an old school arcade game!

The investment, that is the revenue stream, was from charging people to have online access. People would see the computer kiosk and then come on over and swipe their credit card to get online. The idea was that people would pay to gain access to email or their favorite websites. Keep in mind, this was the age of the flip phone not the smart phone.

I was certain this was going to fail. I wasn’t an expert, however, I knew that none of my friends, or anyone else that I knew, would pay to have internet access outside a gas station. There was nothing pressing that would make me, or my friends, want to pay to surf the web from a kiosk.

It wasn’t much longer that my assumption was right, the investment was a bust. Anthony ended up losing the entire investment of $120,000 dollars. The computer kiosks had no residual value. They didn’t even have value as scrap. This was a complete and legitimate loss.

You may think that this wasn’t a lot to lose if he was wealthy. I was never aware or became aware of his wealth status. A few years later, I became aware of his annual income. This guy ended up losing what would take him over one year in earnings to pay off. Said another way, Anthony basically worked for free for one entire year, for an investment that failed.

Why did the investment fail? Was it a brother in-law that was peddling the investment? There had to be some other reason for him to think it was a good investment. What it was, was a good salesperson, paired with an investor who didn’t do research on what he was investing in.

Don’t judge Anthony too hard here or think that this couldn’t happen to you. At this point in time we have the benefit of hindsight. Technology changes fast and salespeople shouldn’t be the ones doing the research for the investor. This would be a bias source of information and one should seek other sources that carry significantly less bias.

Not only did Anthony give up one year’s working wages to make an investment in a series of online kiosk computers, but he lost the ability to pay for his children’s college. Remember, that $120,000 dollars was what he had saved to pay for college. His intent, was to grow the $120,000 dollars to something larger, not lose the entire amount. His investment was a gamble, something equivalent to a Hail Mary pass in a football game.

Anthony ended up taking a loan out on his home to help his children through college. This was heartbreaking and sobering for Anthony. The investment was to make a return, not end up in a complete loss. What a kick in the gut!

The first thing about investing, do your research. Nobody is more concerned about you, than you. Personal finance is about you. You will reap the rewards of good decisions and feel the pain of bad decisions. This is what it means to grow up and be financially responsible.

This book is about everything we should have learned about life’s financial decisions at some point. Specifically, the knowledge we should have had before making that decision. We should have gained this knowledge from school, parents, relatives, or friends.

Without the right knowledge you are left with a lot of questions. Or possibly worse, not knowing that you should be asking questions. This book will cover those small details that were left undiscussed or misrepresented.

This is exactly what Anthony was missing. If you are going to invest, you should be doing research on what you’re investing in. If you are not doing research, you will most certainly come up short on what questions you should be asking.

Some may be saying this doesn’t pertain to me because I will never have any money to invest. This is more than about having money to invest. It is about learning that all personal finance decisions are...

Produkt-Details

• Erscheint lt. Verlag: 8.7.2019
• Sprache: englisch
• Themenwelt: Sachbuch/Ratgeber ► Beruf / Finanzen / Recht / Wirtschaft ► Geld / Bank / Börse
• ISBN-10: 1-5439-7747-2 / 1543977472
• ISBN-13: 978-1-5439-7747-9 / 9781543977479