Monthly Archives: April 2014

Slave Drivers of the 21st Century: Marketers and Debtors.


12 Years a Slave

Not too long ago I went to see the movie “12 years a slave.” The story takes place in the 1800s when Solomon, a free black man who lived in New York, was kidnapped and taken to the South as a slave until he was rescued 12 years later.

1800s slavery

During the movie I noticed that most slaves worked full time and then went to their hut to eat and to sleep, and then the next day they would get up and do the same all over again. They did work that the didn’t like for the rest of their lives.

21st Century Slavery

Today during the 21st century, many of us work full time in jobs that we don’t like for the rest of our lives. In some ways, we are worse off that the slaves of the 1800s. At that time the slaves didn’t have to worry about having a place to sleep or food to eat. Many of us cannot take food and shelter for granted.

Paycheck to Paycheck

Most North Americans live from paycheck to paycheck. No matter what their income level is, if they miss one week of work for whatever reason, they can get into serious financial difficulty.

Debtors and Marketers are our Slave Drivers

We have two major slave drivers: debt and marketing. Marketing encourages us to buy things that are beyond our means and creditors give us the money which later becomes our shackles. Millions of North Americans are enslaved by student debt and credit card debt and as soon as they are getting out of debt, some clever marketer tells them that they need to buy a bigger house, a newer car, a new brand of jeans and another gadget.

Government was supposed to serve us

But that’s not all. There’s another important slave driver. The government. The government takes more than 50% of your labor in the form of taxes. Federal taxes, provincial taxes, municipal taxes, gas taxes, cigarette taxes, alcohol taxes and so on. All this so that we can go to another war, create more wasteful spending and so on. Government was supposed to serve us, but in reality it is exploiting us.

Are you a productive slave?

And the story continues. If you have a regular job, you know that for each dollar that you get paid, you have to produce more than one dollar in profit, so that the fruit of your labor can satisfy the shareholder who created that wonderful job for you.

Now, whatever money is left over, must go towards paying rent or mortgage. You also need to pay your student loan, your health insurance, your transportation to your job, your clothing, etc.

Let’s self medicate

This is beginning to sound very depressing, so we need to medicate ourselves with junk food, alcohol, illegal and legal drugs. Also, since many of us don’t like our job, we take medication to help us sleep and to fight our ulcer problems.

We are slaving other countries

Now, think for a moment that we in North America have won the geographical lottery in which we are almost guaranteed a higher standard of living than in many other countries. If you consider this, you will realize that there are deeper levels of slavery. In many countries, kids are working in factories, producing plastic toys for our North American kids. In Cote d’Ivoire there is child labor so that we can have delicious Swiss chocolate.

Don’t flirt with coworkers

But there’s more. I just mentioned the economic conditions. Now let’s look at the behavior that we’re supposed to have. Many workplaces have a dress code. If you work at the bank, you can’t go in a t-shirt and sandals. In many places you aren’t supposed to flirt with your coworkers. When Cheryl used to work at another dance school, she was forbidden to build friendships with her students.

But there’s hope. Today, you have the opportunity to break free from your shackles. All you need is a plan and you need to execute it well.

Freedom for sale

In the old days, someone could buy your freedom. Solomon, the main character of the movie was a free man because his father was given his freedom . Today, we all have the possibility to buy our own freedom.

Let’s start with two assumptions: You can get average return on investments of 5% and that you can live on $50,000 per year or less. With these two assumptions, your price of freedom is about one million dollars.

I did several calculations and this is my result. If you save $100 per week from age 18 you can have one million dollars by age 65. Or if you can live on $25,000 per year, you can retire by age 53.

There are many combinations to achieve your freedom. You can start a business, you can earn more, you can spend less. At the end, the most important thing is to have the desire to be free and to start taking steps towards your freedom. If you are complacent with your slave status, then you will always be a slave. Freedom is within your reach, but you have to fight for it.

“The best way to predict the future is to create it.” — Peter Drucker

The best way to predit the future is to create it. In Toastmasters club, every week one person is encouraged to offer a  moment of reflection by expressing an inspiring or motivating thought worthy of reflection. For the meeting of April 15, 2014 I chose this quote from Peter Drucker: “The best way to predict the future is to create it.”

Peter Drucker (1909-2005) was a business consultant, educator and writer whose work contributed to the foundation of the modern business corporation.

I believe that many of us accept too passively the reality presented to us and we don’t bother to create another reality. Only those who step out of their comfort zone have the ability to create a better future for themselves. I encourage you today to start creating that better future.


How to create a budget plus a few savings tips.

looking at the budgetThe magic formula to create wealth is: Spend less than you earn and invest the rest

Most of us know how much we earn, but we don’t always know how much we spend, we just know that if our credit card balance continue growing, then we’re heading in the wrong direction.

There is only one way to find out how much you are spending and that is by creating a budget.

OK, this is how to make a budget:

Take a sheet of paper, or a spreadsheet, and divide it in two.

How much are you making?

On the left side, write how much you earn. Just look at your paycheck and look at the money left over after the government has taken a bite. This is your revenue.

If you make some extra money on the side, write this amount as well.

How much are you spending?

Now, let’s look at the right side. Let’s start with your utilities. Make a list of all your fixed expenses such as your telephone, Internet, mortgage, rent, food, groceries. While on the subject of utilities, do me a favor, cancel your cable subscription, you don’t need it. Do you really want to spend all those hours in front of the TV?

If there is money left over, then we can continue. If there is no money left over, wow… you are in serious trouble and you need to make some major adjustments to your life. Either earn more money or live with even less.

Let’s assume that you have some money left over. The first priority is to pay back your debt.

Credit card debt

The first debt that we must eliminate is credit card debt. Consider credit card debt as your mortal enemy and you want to start eliminating the debts with the highest interest rate. Then tackle your other debts. The higher the interest rate, the higher the urgency to eliminate it.

Auto Debt

Let’s continue looking at your debts. Are you paying too much on car payments? Please consider owning a small vehicle rather than a big vehicle. Be nice to the environment and to your own budget. Any time that you buy a vehicle, consider buying a 5 year old vehicle rather than a new vehicle. You will be able to pay half price and still be able to drive it a good 10 years.

Education Debt

Let’s also look at education. Education is an investment, not only financially but also personally. If you’re uncertain about the job prospects in your field of study, consider just studying part time while working. There is no sense in getting in lots student debt loans for a career that will not pay back on its investment.

Check out this FREE accredited university where you can take classes online. University of the People.

Designer clothes and computers

Let’s continue looking at your expenses. Do you use designer clothes? Really? For a pair of jeans you could pay $20 or $200. Most of the time the only difference is the label in the back. Also, did you pay $2000 for an Apple computer to look at FaceBook, YouTube and to write e-mails? you could have paid only $500 for a PC that does the same.

Eating and going out

Now, let’s look at how much you spend eating out and going out. How much is your tab at the bar? How ofter do you eat out? I am not saying “Don’t do it,” I am just saying, be aware; for some people this is a great money drain (This is my situation).

If you have any money left over, then invest it. We will talk about investments in future posts.

Invest at least 10%

The way I used to do my budget was to put 10% of my money in my investment account as soon as I got paid. Then I figured out how to live with the other 90%. If you follow this example, over the years this savings will grow to an incredible amount of money. I heard of this Canadian blogger, Mr. Money Mustache, who saved 50% of his money each time he got paid, and by age 30 he was able to retire.

You can achieve financial freedom in a few years. It all depends on how much priority you give it in your life.

Good luck.


Book Review: Awaken the Giant Within by Anthony Robbins

Awaken the Giant Within by Anthony RobbinsI was overwhelmed. In 540 pages, Tony Robbins tries to teach us how to take control of our mental, emotional, physical and financial destiny.

I was also overwhelmed by Tony the man, Tony the writer and Tony the marketer. I could feel his energy coming through each page of the book.

The name Tony Robbins surfaces often when people talk about personal development. He is the ultimate guru when it comes to motivational speaking. He writes about self help, overcoming fears, building wealth and enhancing relationships.

But he is also an amazing business man. He has reached over 4 million people in over 100 different countries. He tells us how he went from a janitor (like me when I arrived to Canada) to a person who in 2007 earned over 30 million U.S. dollars.

“Awaken the Giant Within” is Tony’s second book written in 1991, which is a follow through of his first book “Unlimited Power.” Both books were national best sellers.

The first thing that we learn is that we have to have a desire to change something in our life, whatever it is, whether it is mental, emotional, physical or financial, to be able to realize those changes. The desire has to come from within. He can help us quit smoking or lose weight, or get wealthier but the desire has to come from within us.

Let’s take getting fit as an example.

  1. We have to have a desire to get fit.
  2. We have to associate feelings of pain when we eat that greasy hamburger and associate feelings of pleasure when we go out to jog. For example, if we eat a hamburger, we will pay a penalty, we will do the dishes; on the other hand if we go the gym 3 times per week, we will get a massage.
  3. We reinforce this new pattern of eating healthy and doing exercise until it becomes a habit.

He goes deeper into how to overcome debilitating habits such as overeating, drinking, drug abuse, etc.

There is a chapter dedicated to how to take control of one’s finances. Another one on how to eat better and why we should eat less meat and another one on how to take control our emotions.

Perhaps, the one critique that I have about the book is that it tries to be everything to everyone, and even if he does have an answer for every problem on earth, the sense of being overwhelmed doesn’t go away.

Another critique that I have is the sensation of being sold into one of Tony’s programs. Tony makes his wealth by teaching workshops. He travels the country doing seminars where he hosts about 5000 people and the price range of each seminar is anywhere from $595 to $2595. In short, I get the feeling that the book, although valuable on its own, is also a great lead generator to get more people into the program.

The book and the teaching are of great value, but it is difficult to tune out the fantastic salesman behind this incredible marketing machine.

Read my review of Money, Master the Game by Tony Robbins

Our finances evolve as we grow older

evolutionAs we grow older, our financial objectives and needs change.

As a kid, my main objective was to have toys and to be able to buy junk food in the school yard.

As a teenager, I would have done anything to have a car. I begged my parents until they gave me one while some of my female friends wanted designer clothing, jewelry, shoes and bags.

In our early twenties, our biggest financial goal is to make it through school. Many of us are lucky to have parents with enough money to put us through school. Others to get student loans or to be frugal while working and studying at the same time. Looking back, I think that the best alternative in most cases is to work and study, instead of accumulating so much debt. Another financial priority when people are in their 20s is partying; beer, wine and money can disappear very fast.

In our 30s, we are probably married already and planning to buy our first house or/and to have our first baby. This is a time when we take on big responsibilities.

In our 40s, we want to have money for our kids’ education, we want to save for retirement, we want to pay the mortgage, and we want to indulge in family vacations.

In our 50s, We are probably switching from the family house to a smaller house or condominium. We are accelerating our savings for retirement.

In our 60s, those of us who have the money, retire or start a second career. Those of us who don’t have money continue working at their regular job.

There is no right or wrong when it comes to financial planning. Most advisers emphasize the value of savings for retirement, but life is short. There have been many cases in which a person abstained from many pleasures of life only to die soon after retirement. Certainly a one year sabbatical can be enjoyed more in one’s 30s than at age 70. The inverse is also true. There are people who give priority to “today” living a carefree life without ever saving for the future then have a hard time making ends meet.

A balance between living for today and saving for tomorrow is ideal. Enjoy your present but save some money for the future in case that you are lucky enough to have a long life. Small adjustments that allow you make the most of your life while putting some money away is the best compromise. I will show you how in the next few posts.