Thinking about Investing? Start Now

The below chart illustrates the importance of investing early and the power of compounding interest. When it comes to investing time really is on your side.

Case 1:
• $2,000 invested annually in years 1 to 5
• No contributions after year 5
• Assumed rate of return of 10%
• Interest compounded annually.
• All interest is reinvested.
• Total invested $10,000

Case 2:
• No money invested in years 1 to 10
• $2,000 invested annually in years 11 to 40
• Assumed rate of return of 10%
• Interest compounded annually.
• All interest is reinvested.
• Total invested $60,000



You have probably seen similar charts on the front of mutual advertisements and although I’m not a huge proponent of mutual funds I think the underlying message is valid---The earlier you start investing the better.

The Secret to Financial Success

Many people have the view that finances and investing is some kind of mystical puzzle that once solved will instantly eliminate all their financial troubles. The code will be broken and the chest of gold will fly open (just watch any late night infomercial). In my opinion the notion of a financial quick fix is the most dangerous and damaging perspective that anyone can have. Having this view effectively removes individuals from their current financial problems. It rationalizes the belief that you don’t have to diligently and effectively manage your money because once you figure the secret out everything will be OK.

In my opinion the real secret to financial success is the realization that there is no secret, and that for 99.99% of the population (myself included) there is no formula or secret that is instantly going to solve all your financial problems. The real secret to financial success can be found by following these 3 easy steps:

1. Spend less money than you make.
2. Invest your saved money.
3. Repeat 1 and 2 until you can retire.

Well the secret is out...that’s really all there is to it.

If Only You Had the Inside Scoop

Bought too early? Sold too soon? Should have seen it coming? Well don’t feel too bad, here’s a list compiled by Micheal Brush of MSN Money of some of biggest insider mistakes of 2007.



*The losses above were as of Jan 18, 2008. As we know the market hasn’t performed well this year so many of the above losses are potentially much higher.

Toyota - Soon to be the Worlds Biggest Car Maker?

Toyota’s strategy of shifting their focus to emerging markets seems to be paying off as they are now expected to surpass GM in annual sales by the end of 2008 making them the world’s largest automaker.

According to an article by Martin Foster in the New York times.

“While sales declined in North America, they increased in Asia, especially in Indonesia and Thailand, and in other regions including South and Central America, Africa and Oceania.

In the nine months through December, less than half of Toyota sales came from its showrooms in North America.

Sales to North America slid to 44 percent from 57 percent a year earlier, while Asian sales rose to 25 percent from 15 percent.”

As a consumer it’s no surprise that GM is about to be bumped from the #1 spot. I am by no means a picky shopper but for me it’s basically at the point that when I’m car shopping I don’t even bother looking at North American cars anymore. My reason for this is simple...I want to own a car that isn’t going to break down and from experience and the experiences of people I know GM can’t seem to meet my single criteria.