Extended Warranties?

Do you buy extended warranties? Here's an article from the Consumerist stating why you do what you do.

Why Pennies To Wealth?

I thought I should clarify why I called this blog Pennies To Wealth.

It has to do with the idea of saving small amounts and building wealth in the long run. In a post I wrote the other day regarding Ric Edelman who studied over 5,000 wealthy Americans, he discovered that many of them used small amounts of money to invest over long periods of time. They were consistent and found that their money grew surprisingly well.

Remember it may be easier to cut expenses on big items, rather than smaller ones, but keep in mind it all adds up.

Even saving your loose change every day will make a difference.

So the next time you wish you had more money saved, remember that small amounts over time add up, and that your pennies will turn to wealth.

Believe In Wealth

Warren Buffett has been quoted as saying,

I always knew I was going to be rich. I don't think I ever doubted it for a minute.

When It Comes To Money, Don't Follow The Crowd

Are you glued to CNBC or MSNBC during the day, following the latest stock market activity? Do you read all the money magazines every month? Do check your 401k balance every day? If you said yes to the above questions...I have one thing to say:

Relax.

You don't have to follow every move the stock market makes. It could be hazardous to your health. Maybe not, but let me explain.

If you pay to much attention to the news or your account balances you are more likely to make some emotional decisions instead of sound financial ones. When others start selling stocks so do you. When people are buying, you are more likely to buy. So what can you do?

Stick to your guns, and your financial plan. Even Warren Buffett says you should not follow the crowd. Create a plan, buy your mutual funds. Keep buying them when you can, and hold them for a long time before selling. At least five years.

The stock market can turn on a dime. Don't waste too much time changing your mind. Make a decision and stick with it. You'll be glad you did.

Mutual Funds: Another Key To Wealth

I only invest in mutual funds. I don't have individual stocks and I don't care too. If you ever wondered what a mutual fund was, and would like to know the pluses and minuses of owning them, here is a good article on the topic from fivecentnickel.com

Specialized Knowledge: A Key To Wealth

There are two kinds of knowledge, general and specialized. For the most part, general knowledge does nothing to help you acquire wealth. There is plenty of general knowledge being taught at high schools and colleges; but we as students are not taught the right kind of knowledge, or how to use it to make money.

Specialized knowledge is needed for the particular service or product you are offering. A key point is that you don't have to possess the information to use it successfully. There are several ways you can gain specialized knowledge: At the library, by asking someone, by distance learning courses, or night classes.

You can even have someone smarter than you are work for you. Of course you will have to provided fair compensation for their efforts.

We all have general knowledge. Maybe that is why games like Trivial Pursuit are so popular. There is nothing wrong with having general knowledge as long as you realize it won't help your money grow.

We get paid for the value we bring to a product or service. If we provide basic information that is readily available we won't be compensated as well as if we have a more specific skill set.

So remember to take the time to develop your knowledge, or find someone who has the skills and work with them. It will pay off by putting more cash in your wallet.

Why Renting Makes Cents

Here is an article from SmartMoney on MSN money. The author talks about why he rents instead of owning a home. Here is a teaser:

I have something un-American to confess: I rent an apartment despite having enough money to buy a house. I plan to keep renting for as long as I can. I'm not just holding out for better prices. Renting will make me richer.
I normally write about stocks for SmartMoney.com, but the boss asked me to explain to readers my reason for renting. Here goes: Businesses are great investments while houses are poor ones, so I'd rather rent the latter and own the former.
SmartMoney

Here is the rest of the article. After reading it, I don't feel as bad about renting. Do you own or rent?