Blogs

May 18, 2012

All of the buzz in the financial world today is around Facebook's IPO (initial public offering).  Sure, we've all heard how Zuck will now be worth $20 billion and many millionaires will be made at the company today.  However, this is one of the most ludicrous questions I've heard all morning:  "Is Facebook the next Apple"?

In short, if you're investing in Facebook, you better hope it's not the next Apple!  Apple's IPO was in 1984 at just under $4/share.  If you held onto the stock for 15 years until 1999, your one share would be worth… well, only $8 dollars!  Actually, there was one split so it'd be worth $16.  Here's the chart from that period:

What they really mean when they ask the question is this, "Will Facebook become what Apple is today?  You would have had to endure many rough years as an Apple investor if you bought it at the IPO.  Apple's chart now looks like this: 

May 17, 2012

Use the rule of 72 to figure out how long it will take your money to double at different interest rates.  All you do is divide 72 by the interest rate and the product equals the number of years to double.

For example, if you assume a 10% interest rate, the rule of 72 work as follows:

72/10 = 7.2 years for your money to double

I like to use this rule to forecast how much money I'll have for retirement.  For example, if I assume I have 35 years for my money to grow (from now until age 65), it would double almost 5 times at a 10% return (35/7.2 = 4.86).  That means $10,000 would turn into approximately:

Double 1 = $20,000

Double 2 = $40,000

Double 3 = $80,000

May 14, 2012

After I graduated from college, most of my married friends became SINKs (single income no kids) or DINKs (dual income no kids).  It's a common transition for our generation because it's expected that both sexes will have jobs when there are no kids in the picture. 

Many of these individuals went on to great careers and some of the SINKs transitioned to DINKs.  After rounds of weddings, it was time for the next stage for many… rounds of kids.

Some of the women in the picture had already established a great career with a nice income.  They swore they'd never leave the engagement and excitement of their careers.  However, for many this changed when their new family additions came along.  So what happens when DINKs become SIK (single income, kids - no pun intended!)?

If you're transitioning to a single income family, things are going to change and there's probably going to be less money to go around (obviously).

May 10, 2012

Another minute ticks away, and I can't help but notice the sun's final rays retreating to lands beyond.  The heat that must accompany a warm New Orleans Spring day as such is no consequence to me because of my air conditioned room.

I'm comfortable.

It's Thursday night.  I know I should write another article for my blog, but I just don't have the energy.  From the television, Alex Trebek enlightens me with new tid-bits of knowledge that will soon disappear from my mind like the minutes that tick away from my time.

I'm comfortable.

May 7, 2012

Football players are usually separated into different positions based on their skill set.  If you are 300 pounds and can tip over a car by yourself, you'll probably be a lineman.  If you can throw a football over a mountain, you might be the quarterback.  However, there is a very small group of players that are simply called "Athletes".  These are the players that can play many positions and can't be called just one thing.

In "How to be a Consultant", I list the five ways to get ahead in your career by working like a consultant:

1.  Become self-sufficient by building your network

2.  Every time you start a new project you must learn very fast about the client and the work

3.  You must keep up with the latest technologies and best practices