Debbie has nearly 20 years of investigative experience and journalism on topics of insurance, mortgage, and financial advice.

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Money Strategies with Debbie

TDD 109 | Habits Of Rich People

Mimicking The Habits Of The Rich To Become A Millionaire

TDD 109 | Habits Of Rich People

 

It’s often stated that success always leaves clues. Take a look at the simple habits of millionaires and how mimicking them may prove to be a great practice for you. In this episode, Debbie Bloyd talks about strategies used by professionals to simplify and organize their lives to be more efficient. She also discusses the numbers behind the preparations you need to take if you want to be a millionaire. Debbie gives a reminder about the importance of starting as early as you could, in terms of planning and saving for your future. Learn about the specific habits of the world’s richest people that are studied to be the common denominators in their success. Simple behaviors that you, yourself, can apply in your routine right away.

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Mimicking The Habits Of The Rich To Become A Millionaire

Simplifying Life

Do you want to simplify your life? Don’t we all need to simplify our life? We need to simplify our banking, our finances, our 401(k)s. Everything needs to be simpler. It’s just getting too complicated. People come into my office every day to apply for a loan or talk to me about investing for their retirement. They’ve got statements and papers and bank accounts everywhere. This episode, I thought I would find some ways for us to simplify our lives. It doesn’t have to be that complicated. We are gunking up the system and our minds are really busy trying to keep up with everything we do.

Here are twelve easy ways to simplify your life. Striving for success. This comes from Success.com. I didn’t make this up. I’m not that good. The magazine is amazing. I read it all the time. I started printing out articles that I want to talk to you about and things that I want to weigh in on because it’s really important. Striving for success is hard and if you focus on your professional life, then your personal life suffers. We’ve all figured this out. You’re supposed to have something called balance. I have no idea what that is. I have no balance.

I’ll tell you what I’ve done and why I need this article. Because I work like a dog when I don’t have my kids with me and they’re at their dad’s house. When they come back to my house, I have time with them, and then when they leave again, I work like a dog. I have no balance. All my hours are full. I fall into bed at night because I’m exhausted from doing all this stuff, but I love what I do. Don’t get me wrong. Hence my need for the article and probably yours too. When you strive for success in your professional life. You can neglect your private life. A busy workday makes for a tired me at home.

While overtime on business trips can cut into the time you spend with your family, then if you go to the gym or you go out with friends, there is no time left over. Being ambitious means that you have to make sacrifices. The bigger the ambitions, the bigger the sacrifices, but in the long run, this might leave you feeling unhappy and unfulfilled. Climbing a ladder isn’t always best. In addition to hard work and dedication, successful people plan well, look after their personal needs and maintain a good balanced life in their work, their social, and their private lives. I’m still trying to figure that out.

Striving for success is hard. If you focus on your professional life, then your personal life suffers. Click To Tweet

Reassessing the way you function in the workplace can be a good place to start. Make your work routine simpler and more efficient. You will have more time and energy available to attend the other parts of your life. If you’re overwhelmed by your workload, start the day by listing what you need to get done. Concentrate on doing the big tasks that take two minutes or less. This can help you skip procrastination period and feel the reward of ticking things off your to-do list. I do that. I have everything on a to-do list, but a lot of it’s equally important, so I just start at the top and keep moving down.

The only time it’s okay to change this is when you highlight maybe three big things that are most urgent, and you concentrate on the big items and not the fast items. The things that are important. Different articles talk about different ways to do it. Sometimes you’re supposed to do what’s important to you and let the emails go on the second or third hour. Pick a system because we need some kind of system. There are three ways to simplify your situation at work. There are plenty of similarly simple approaches you can take to your relationships, and your home life to further balance the way you live. How to simplify your life to find out which are the areas for your life to begin with, answer the following questions. “When it comes to family and friends, I wish I saw them more, feel close to some but worry about not seeing the others, or I’m happy with my relationships.”

Based on where those go, you can either, “Do I feel that work is overwhelming or does your home feel cluttered and cause you stress?” We’re taking it from, “I wish I saw more of my friends.” They’re going down the work side of the paper. If you are happy with seeing your friends and family as much as you do because frankly, some of us don’t have families we want to see. I don’t have any more family so I can say that tongue in cheek, but I know a lot of families that have a lot of stress around them. Some people move across the country to get away from their families. I get it. “Does your home feel cluttered and cause you stress?” If so, then we need to simplify your home. We need to go to this part called simplify your home. To simplify your home, choose the items you want to keep and discard the rest.

This is an old trick that they use when we do real estate stuff and you have to state your house for sale. They tell you to take out all the personal stuff, and then you need to do this to simplify your house, get out all the junk. Because when you sell your house, you can’t have all that there. You choose the items you want to keep first and then you discard the rest. Next, you organize your home by category, not by room. Organizing by room shuffles things from one location to another. Start with your clothes, followed by books and papers and small sentimental items. After that, you wait four days to buy something after you see it. Another good trick is you don’t bring something new into your home furniture wise until you take something out.

TDD 109 | Habits Of Rich People

Habits Of Rich People: To become a millionaire by the age of 65, you’re going to need to invest and save money at the same time, while paying off debt.

 

What if we want to simplify our relationships? “How many of us have friends that are high maintenance, or depressing?” We just need to cut those people out. For simplifying relationships, write a list of pros and cons of negative relationships and set boundaries. If you establish a person whose cons outweigh the pros, then limit your time with them. Set a goal of not contacting them for three months and see how you feel afterward. By that time, I don’t know that they’ll even call you a friend and see how that affects you. Next thing, “Write a list of supported people in your life and reach out to them. This includes people you currently stay in contact with and those who wish to reconnect with. Send them a Facebook message. Ask them how they are and what they’ve been up to.”

For someone that’s my age, pick up the phone and call them. I know it’s so old fashioned. I don’t need to Snapchat my girlfriends. I just need to go to their homes and physically hug them and let them know I love them. That’s what I do. I spend time with the people that I love. You got to lay hands on them sometimes, or you can schedule time in your calendar to call family and friends. “Use this opportunity to catch up and plan activities together. If over the phone is good, then a face to face might be better.” I agree. Let’s say our life relationships are good, and our home is good, then what do we need to concentrate on? Simplify work life. That’s a good one.

“List down everything you need to do, pick the three most important things and do them first. You can finish something in two minutes or less, do it right now and start saying no to extra work when you don’t have the time. Be honest and straightforward with your boss. Explain that you already have more projects that you’re working on and cannot possibly take anything on at the current moment.” That may lead to bad things, I’ve always thought, so I just keep piling it on. I figure out a way to get it in. I can sleep less. My kids come first. First of all, there’s God, then there are my kids, but then there’s work, and my friends, we all filter in because we know what our priorities are. We’re all good with that.

You need to find a way to simplify your mind and that’s the big one. “Take short walks in the mornings or the evenings. When we walk, jog or run, our brain releases neurons that reduce anxiety. Walking in the morning sets you up for the day while walking in the evening can help you process events that happened.” When I’m stressed, I walk or jog, whatever. Get out, take the dogs out, go for a long walk and makes you feel better. “Write down three things every evening that went well and explain why. Download your headspace and practice ten minutes of guided meditation every day.” That one I should pick up on. Ten minutes of guided meditation. “Keeping these simple things shouldn’t be complicated, but start by making small changes to get big results. Just remember to pause, reflect and make positive changes, and you too can simplify your life.”

Being ambitious means that you have to make sacrifices. The bigger the ambitions, the bigger the sacrifices. Click To Tweet

Becoming A Millionaire

A lot of people talk about wanting to be a millionaire. I’ve done several small talks on the radio about, “If you could just retire with $1 million, you’d be set.” In this episode, we’ll know how to save $1 million. Where it’s going to get you when you’re 65 based on how old you are. It’s never too early to start. We talked about time being on your side. Unless you hit the jackpot or you sign on with the major sports franchise, accumulating a seven-figure retirement account is going to take decades of saving. You better start now. If you wait until you’re 35, to start investing your savings in the stock market, to become a millionaire by 65, you’re going to have to save more than double the amount you would if you had started at 25. That’s a big number. Assuming an 8% return on stocks, a 4% return on bonds and accounting for an inflation rate at 2%.

At least you could save $306 a month. You can become a millionaire if you start when you’re twenty and plan to retire at 65. Of course, few people can start that early. They’re having kids are having fun, they’re spending money. Kids are expensive. If you save $444 every month beginning at 25, you’re going to hit your goal within 40 years. I don’t know too many 25-year old’s putting that kind of money back. You invest in stock market mutual funds through your company 401(k). If not, you open up an IRA. Many young people are now tempted to put off saving, feeling that they should erase all their student debt first. To become a millionaire by the age of 65, you’re going to need to tackle both goals at the same time while paying off debt. You got to look at the interest rate of your debt, versus what you can make in the market, your IRA, your 401(k) or whatever your work has.

To be sure, there’s plenty of evidence that even $1 million may not be enough to sustain you through the several decades that you’re going to be retired. I’ve said before, I don’t want to retire. I like what I do. As long as I have the ability to think, I can keep working. I can work without an arm or work without a leg doing what I do, but if something happens to me, and I lose my brain capacity, that’s going to shorten the amount of time that I have to earn money. You’ll have to make serious sacrifices, if you wait until your 40s. If you wait until you’re 40, you’re going to need to save $1,396 every month, beginning at 40, if you want to break the six-figure ceiling by age 65. If you’re starting late, you can boost your savings by taking up a second job.

People think there’s a secret when they come to me for mortgages. They go, “I want a better house and this is what I want my payment to be. This is how much I have to put down.” I’m like, “That’s not going to get you what you want.” They’re like, “Do you have some suggestions?” I’m like, “Yes. Make more, spend less.” There’s that, “This is my job. Get a better job. Move to a different area. Retool yourself. Make a way to make more or spend less.” If you’re saying, “I have no student debt, I paid off all my cars. This is all I can afford.” You might need to rethink what you’re doing and retool your job. There are some things to do, but they’re not always fun choices for a lot of people.

TDD 109 | Habits Of Rich People

Habits Of Rich People: Behaving like the uber-wealthy won’t make you a multi-millionaire, but mimicking their habits could reward you with great big sums of money.

 

Change is hard, and I get that. I’ve done a lot of change in my life. I can’t even begin to tell you the change that I’ve gone through in my life. My deal is I never want to do with less. I just need to figure out a way to make more. I got two kids in college. You got to make more. I travel. I have businesses in Houston and Austin. I’ve got an office in Dallas. I travel back and forth every week. Yes, it’s a lot to do. Yes, I’m everywhere. Yes, I’m getting no sleep, but when they were little, I didn’t get any sleep either. It’s totally fine. It’s going for a good cause and it’s my choice. I’m not so much worried about retirement. I’m worried about getting them in a position that I want to have them in by the time they graduate and me in a position.

One of the things to think about is health. Not everybody has good health and we want to think about our health when we come to our financial planning. Life expectancy is a big thing. A lot of people have questions when it comes to deferring Social Security and delaying their retirement. Your life expectancy changes as you age. According to the US Census data, Americans spend roughly eighteen years in retirement on average, but averages tell an incomplete and potentially misleading story when it comes to longevity. For example, if you put Bill Gates and another American in a room, the average wealth in the room is suddenly tens of billions of dollars, but that doesn’t tell an accurate story.

Many people aren’t well aware of their life expectancy, and the very real possibility of living longer than anticipated. Society of Actuaries’ report shows that only about 43% of retiree respondents underestimated the average age, which they would expect to live by more than five years. You don’t want your money to run out. That’s the whole thing. People say, “Longevity. How does this affect social security?” Many people retire between 62 and 65 years old. The most popular social security claiming age is 62. If longevity risk could deplete your retirement savings, you should consider working longer and deferring social security for as long as possible.

Honestly, those are the two most powerful strategies to reduce retirement income shortfall. Let’s say you’re at full retirement age at 66. If you wait to claim your social security benefits at age 70, instead of age 62, you will receive almost double the amount of income. If you’re expecting to get $1,000 at age 66, you claim at age 62. You would receive about $700. If you wait until age 70, you receive $1,320. That leads me to the next thing that says, “How do you know when you’re going to die?” We don’t. You could have a massive heart attack and then you’re like, “I should have pulled Social Security at 62. Why did I wait until 70? I died at 72.” We don’t know that. You have to look at your parents. You have to look at your overall health. We also have to have backup plans.

We’re more settled in our life when we have a plan. Click To Tweet

I don’t think that these articles are scary, exactly, but they are realistic. Chances are, you’re going to have heart attacks. We’ve done statistics on this show before and none of them are very good about long-term care and how many people need long-term care and at what age. It goes to show that you don’t know when something bad is going to happen. You have to be ready. For myself, I don’t have any more term policy. I let my term policy expire. I have long term care, that also has a chronic illness rider on it that I can draw on. It doubles and triples as a term policy if I were to get hit by a truck and never use those other parts of the policy. There are hybrids out there for long-term care that weren’t there before and we need to look at those.

My first instinct was to get the kids out of college, have a term policy. I’ve got enough to do that, so let’s worry about my long-term care and my savings ability. As you age, you’re going to want to take some of these components that you have. Take them to somebody and say, “Is there something else I could be better doing with this IRA?” “Do I need to turn this IRA money into an annuity that has a set amount of money to bridge the gap between what I think I’m going to earn and Social Security in my pension and a job?” These are all things that we need to talk about and no, life isn’t going to go to plan. I’ve got a friend that laughs at me all the time. He’s like, “You make many plans and it never goes to plan.” “No, I make up another plan then,” but at least I have a plan. We’re more settled in our life when we have a plan. If we have choices, that makes us feel better. While you’re younger, you have choices. If you wait until you’re too old, sometimes it’s too late to get long-term care. It’s too late to get life insurance, all you can get as a burial policy. That’s better than nothing. It all depends on your health.

I have a policy that I took out several years ago when I’m still in good health. A lot of policies you can get after you’ve been diagnosed with cancer, a stroke, or a heart attack. While you’re healthy, give me a call. Let’s talk before something happens so we can make plans. I do a little bit of everything. I do financial counseling than anything. Sometimes that leads to a mortgage. Maybe I need to refinance your mortgage or you’re buying a house, and what are you going to do with the extra money? Are there capital gains? Is there some way we should invest that? I can help you with all those things. I do long term care, health insurance, mortgages, and investments. There’s a wide variety of people and companies that I work with. I don’t work alone. I have several people that I refer to and do business with that can help. If you have a CPA, we work with your CPA. If you don’t have one, you can work with ours. It’s about getting you in a great financial situation.

You should always interview people and always get second and third opinions. Ways to pick a financial advisor is to find someone that you can talk to that has the same goals that you have. If they’re all about buying and selling stocks every day, puts in calls and that’s not your gig, you need to find someone that does your gig. That’s not what I do. I help people plan for the long-term. I’m not the girl to call when you want to buy a certain stock. There are other people that are better equipped than I am for that, and I can refer those people to you. Look at the website, call me if you have questions. Email me Debbie@MoneyStrategiesWithDebbie.com. I do have appointments on nights and weekends. I work all the time. Kids are in college, so I’ve got a lot of spare time. Give me a call and do some investigating. Make sure you’ve thought about it and planned it. Don’t put your head in the sand.

TDD 109 | Habits Of Rich People

Habits Of Rich People: Become your own boss. More than two-thirds of those on the 2014 Forbes 400 were self-made.

 

Habits Of The Rich

Everybody wants to be rich. Let’s learn about the habits of rich people. We’ve always talked about on this show, that rich is relative. What is someone that makes $60,000 rich or someone that makes $2 million a year rich? It all depends on what rich means to you. Let’s think rich is like the uber rich. Fifteen habits of uber rich people. Behaving like the uber wealthy won’t make you a multi-millionaire, but mimicking their habits could start rewarding you by having great big sums of money. What will you do with all that money? It’s dream big.

Listen to audiobooks during your commute. Sixty-three percent of millionaires do it. In the afternoon, steer clear of the vending machine. Most wealthy people eat fewer than 300 empty calories a day. In the evening, make a list before you leave the office. Eighty-one percent of people with more than $3.2 million in liquid assets, keep a to-do log. Write it down. That way, you can release it from your mind. Your mind can get working on the problems and the next morning you can start fresh. You don’t have to spend that time starting over.

Don’t retire ever. Not because you can’t, but because you don’t want to. The highest earners, those who pull in more than $750,000 a year, don’t plan to ever retire until at least 70. That’s more than five years after they’re not so wealthy counterparts according to a study from the research firm spectrum group. Wake up while it’s still dark. I’m never going to be able to do this. Early risers are more proactive and optimistic. One study found that 44% of multi-millionaires wake up at least three hours before work. Number six, focus on the future. Make financial choices about your career home and etc. based on what will pay off in twenty years. This is written by Keith Cameron Smith, author of The Top 10 Distinctions Between Millionaires and the Middle Class. The wealthiest people have long term thinking.

This is an interesting one I wouldn’t have thought of. Make a lateral move or take a step down. Do it if the result may create an opportunity to earn more or propel your career forward. Set a career management expert in this subscription-based job search site called The Ladders. Number eight become your own boss. More than 2/3 of those on the 2014 Forbes 400 were self-made. Number nine, pick up an Amazon membership. A surprising 62% of millionaires shop at the site. Number ten, juice your savings. People who have at least $1 million in their 401(k) save an average of 19% of their income. 14% comes out of their pay and another 5% gets matched by their company according to Fidelity.

The harder you work, the luckier you get. More breaks will come your way when you throw yourself out there more. Click To Tweet

Number eleven, give to charity. Nearly all millionaires do. Number twelve, take on an advisor. Seventy-seven percent of millionaires hire someone to manage their wealth. Number thirteen, ditch the business deals that doesn’t seem right. Wealthy people look at numbers and use gut feelings to determine when something isn’t working or someone isn’t working. No matter how much money they invest in a product or a project, they walk away if the sense won’t make sense, and they can’t succeed. Number fourteen, network for five hours or more a month. 79% of millionaires do. Number fifteen, clean out your voicemail. Eighty-six percent of people with more than $3 million return phone calls immediately regardless of who rang.

You may say, “Debbie, this doesn’t mean anything to me. I don’t want to be rich.” Why don’t we get on to their habits? Even if we don’t make $3 million, or have a net worth of $3 million to $5 million or $20 million. Why don’t we just do the right thing? Do the best thing at the right time. Do the right thing at the best time. Make good use of our time. Everybody says, “You get lucky.” I figured the harder I work, the luckier I get. More breaks come my way because I throw myself out there more. You have to do the same thing in all your walks of life. I do multiple radio shows in different cities and I like helping people so I love it when you call me. Please call me and ask for my advice or help on mortgages, investments, or insurance. I’d love to help. My website is MoneyStrategiesWithDebbie.com. Email me at Debbie@MoneyStrategiesWithDebbie.com, or call me directly. I answer my phone. If I don’t pick up, I’m with somebody and I’ll call you back (979) 220-3018.

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