Monday, June 15, 2009

Simple Money Accumulation

By Kraig Mottar Copyright 2009 ©

This is from the abolitionist movement. The last so-called abolitionist movement was the movement to abolish black slavery in America. The unfortunate part of that was that it only abolished the slavery of one race of people, and advanced them to the slavery that enslaves everyone else regardless of race, creed, and color. Apparently, for many that slavery hasn’t yet been abolished. It is an economic and financial slavery. Made possible by an, ironic, slipping by, of a mathematical principle. And, it is simple addition, oh, and multiplication if and when you decide to enhance the system with interest earning bank accounts and/or investments. You can probably come to your own similar financial principles just by fiddling with a calculator and numbers as I have.

You can start off on your kitchen table, piggy bank, coffee can, or wherever you stash wads of cash, if you are uncomfortable depositing tiny wads of cash in your bank. Something odd about walking up to the teller to deposit $1-$9. And, as you spend cash everyday as we all do, you take out cash, or currency, take out currency and when you spend money, spend currency , bills, and notes whatever you call it. Most prices end in pennies, $x.01 to $x.99. More often than not, an item will cost $29.95 instead of $30.00, the last pennies may vary. This is why change jingles in our pockets so often. As you only spend currency, you will end up with a lot of change or coins. Collect these coins to deposit in the bank. You might want to avoid the coinmaster machines found in supermarkets, they take a fee, but maybe that’s petty bickering. You will, however, at most banks, need to roll the coins. Don’t bring a plastic bag of hundreds or thousands of coins, they will not be happy. You can however get coin rolls to roll the coins in, from the bank. They are $.50 pennies; $2.00 nickels; $5.00 dimes; $10.00 quarters; $25.00 dollars (coins). You will be in single digits for the first week, actually 9 days. It is a process of saving money; you might call this the piggybank method as that is more or less what it is for those first 9 days, you might wait 9 days before actually going to the bank for the first time. You just simply deposit money each day or interval of time as it may become difficult to put away hundreds or thousands of dollars, pesos, pounds, euros, rubles, or peanut shells as this system can be applied to any currency or unit of value or whatever interval of time to deposit the money in, as you probably will expand the time interval as time goes on and as your means increases. So, I won’t necessarily say deposit $x (or whatever you deposit) each "day", rather, think of them time intervals of any duration. I say deposit $x each day, but depending on your means which will vary and change depending on your situation. Days and weeks after you graduate from the piggy bank or kitchen table. When, in this system you are depositing hundreds of dollar, or whatever, at a time, and a time will come when you cannot afford to deposit $1 more, just reset and go back to the beginning and start over back at $1. Likely, each time you reset and go back to $1 or penny you will reset from a larger amount than the last time as, for a number of reasons, especially if you supplement the system with interest earning accounts/investments.

For an idea of just how well the program of $1 the first day, and 1 additional dollar each following day works, see the chart I have included is a worksheet originally worked out in Microsoft Excel calculated for 365 days/deposits. Maybe you’ll go or choose to go that far, that is of course up to you. If or when you are able to you might just do that for fun or demonstration purposes if nothing else. If you do that for those purposes you might publicize your results. Or if that’s the case take it onto infinity minus 1, whatever “infinity” is..

In the calculations, the number on the left is the deposit that day/time the number next to it, on the right is the total that that deposit brings it up to. You can keep a record of this with out necessarily always keeping that money in the same account as you will want to put larger amounts when they get larger in another account/investment to best grow that money.

It is unlikely at first that you can make a $100 or $200 deposit the first time, but you will get there. Though, this statement is by no means universally true. This system will make anyone who tries it, richer. Whether they are already rich or not. If you are not rich, with this system, you will be rich. If you are already rich, say, a millionaire or billionaire. Well whoever uses this system will be rich, or richer.
Yes, the system, I’d think, should be enhanced by interest earning accounts. I don’t know what time intervals you would choose, but this is my thinking., do this starting on (for most of us) payday, put the lump in one (checking?) account, your living account maybe, transfer that amount (that presumably increase each time) to another checking account that exist for the purpose of holding money. At the end of the month, transfer all the money in the holding account to an interest earning savings account. At some point you may want to dump the savings account, or much of it, into certificates of deposit (CD) or other investments of your choice.

Use the large return of the CD* to start this process with a larger lump sum to deal with, each time, maybe, your choice.

Always remember to leave all accounts, even the transitional accounts, always, with a minimum balance necessary to avoid service charges or the bank automatically closing the account.

Ideas of how to expand your means might be desirable. First, innovation; as your means increases, brainstorm ideas, business ideas as your investments return, use some of those returns, also to realize these business ideas. In places like California with its recycling industry, recycle plastic and aluminum. Typically, people who recycle are poor people, non-profit organization, and lower middleclass people wanting to throw a party now and then. But realize the full potential of recycling. If you are in fact, a millionaire or not, and you have a the money you need when you need it, recycling can greatly benefit you too. Unlike the homeless person, you are fortunate, you don’t have to spend the money everyday on food, gas, or a warm dry place to sleep. In fact, you probably don’t need the money every day for anything. Depending on your situation, i.e.: where to store it, and taking it to a place to cash it in, you stand to get an incredible windfall. Depending on your situation, need, or desire, you can recycle weekly, monthly, quarterly, or annually. Or, if you are a millionaire, more than annually. And you can decide what you’ll do with the money, perhaps something else I’ve written here, give you some ideas.
Sell stuff, stuff you have, stuff you can make or create, brainstorm ideas as I have. Tax refunds, or wherever else you can get refunds on. Put these, also into practice, anytime you figure a way to “save”; if you save money, by stopping this or that, or switching to this or that service, or whatever, if all you do is not pay the money you are “saving”, it is not a savings at all. Figure out how much you are saving and save it, put it in the bank. When you no longer have to pay a bill you used to pay, or pay less, put it in the bank. If you paid say, pay, $36 a month to smoke cigarettes, after you quit for instance, put it away, and if you don't and never have smoked cigarettes, this of course can apply to any thing you quit that, for whatever reason, needs to or should be, quit. Every time you do something to “save” money, actually save it.

This will astound the naysayers who so far seem to be financial professionals and older people who are children of the great depression of 1929 in the US, or some other economic down period, there’ve been others around the world, no doubt. And hopefully the current depression won’t have the same shell shock effect. Maybe starting with pennies and little amounts of dollars will help in various periods.

This might be a combination of the following: in the financial professional’s case, they don’t want to lose their commercial niche and they put so much energy and conceit into the fact that they are “trained professionals”. Ooh! Can I have your autograph? In the old man born as we were coming out of the depression, and worked hard, invested right, bought a house or 2 that tripled in value, maybe bought a few too many lottery tickets; the arguments might be, “if this were possible, I would’ve done it, wouldn't I have?”. Most not wanting to feel how this idea may make them feel stupid,.they weren’t necessarily stupid however. Though, it is amazing that this simple idea has never occurred to anyone. The numbers can’t lie. As you can see in the attached Microsoft excel spreadsheet calculated for 365 days/deposits.

Another idea is one that may have to wait for large, but not impossibly so, amount, simple large amounts for many. To pay for an intermittent bill. The bills you have to pay every month (time period). Put a larger amount of money in a savings account that will yield an interest payment each month, quarter, or whatever, that equals the amount of the bill, so the principal always grows. You might put slightly more than necessary in the account so that the principal always grows beyond the bill. Like a cable bill, rent, loan payment, phone bill, etc, anything you have to pay every month or week. You may have to work towards this. Tackle the smallest bill first and the largest bill last. When all is set up like this, these things will seem to be “free”.
The formula is this for a $100 per month bill and an account yielding 5% interest. $100 a month=$1200 year. $100 divided by .05

Also on this concept of interest; often people say/think this, “if I had a million dollars I’d live off the interest” and you can do that with less. But if you do this, live off half the interest, the principal always gets bigger. If you take all the interest of a million dollars the principal will never be more than a million dollars. If you live off half the interest at a young enough age, and I’m not sure what that exact age is, you may likely die with more than $100,000,000 or more. Maybe the richest already do this, which might tell us why the rich always get richer. And then, the poor always get poorer because they are paying the interest, and if they don’t realize these principals, so then, poor planning keeps them poor.

Saturday, October 18, 2008

Welcome to The Unreasonable Rationalist

The Unreasonable Rationalist

© 2008 by Kraig Mottar

The Unreasonable Rationalist is [to be] a magazine, originally conceived to publish religious, spiritual, philosophical, political, etc,. Articles, then it occurred that those topics are potentially boring to some people, by mention of just those descriptions. Then it was and is thought, that there will stories, short stories, poetry, etc and articles of general interest about hobbies, happenings around town, etc, etc. And the etc's may have the most draw..

The Unreasonable Rationalist will have broad appeal to all, even those who are bored by this or that topic or subject matter, as the magazine nor its publisher will necessarily have any particular axe to grind, not shy away from anything due to personal disagreement, as the other side will also be published. Those who are usually bored by say, politics and religion, but not always, may be attracted by parts of the magazine they do like, and by chance see something on politics, religion, or whatever, that may by chance grab them in..

The Unreasonable Rationalist will not be Christian, atheist, or whatever; it will not be Republican, Democrat, Communist, anarchist, or anything else; but will publish all those topics, side by side.

There are Christian and atheist magazines and there are Republican, Democrat, Communist, anarchist, etc magazines, they are devoted to their cause, field of interest, or point of view, and often, passionately so. They waste their time and effort, since the only ones who can or will ever read what they publish are people who already agree with it. How pointless and counterproductive is that?