Archive for November, 2006

The importance of return on invested money

Wednesday, November 29th, 2006

I found an old paper from my sociology class back in 1996 or so that I thought would be interesting to share. The teacher was complaining about the disparity between rich and poor and mentioned Warren Buffet’s fortune. If he has 4 billion dollars and gets an 8% return, he’s looking at $864,000 each day. So in two days of non-work he earns more than most people earn in a lifetime of work. The original source is Hunt and Sherman’s Economics.

You don’t need a degree in economics to help manage your money but it doesn’t hurt.

Should you buy a house before investing in the stock market?

Sunday, November 12th, 2006

In the Peter Lynch book I’m reading, Lynch writes that houses are normally more rewarding than stocks. Especially primary residences with all the associated tax breaks. However we also routinely recommend that people put money in stock-based IRAs and things as early as possible – well before the person can afford a home. Personally I disagree with Lynch here. You might as well invest in stocks as you build up capital to buy a house. Sure it carries more risk than putting money in the bank each month, but there’s a good chance you’ll be in a better position to buy a home thanks to investing early and often in life.


Thursday, November 9th, 2006

You know how I’m usually saying that the best way to get rich is to start a business and invest the profit? Well here’s a website all about starting businesses. If you’re curious or actively looking for a business opportunity, then this is the site for you.

As usual, I did a little searching so I can give you a preview. One section I checked out was the home based business opportunity section. Who doesn’t want to work from home? That’s easiest when you’re the boss. From candles to home parties, there were some interesting ideas there.

Naturally, I had to check out the internet business opportunity section. It’s hard to tell exactly what kinds of websites or services you’d be working with from the descriptions, but one of these says its the 4th fastest growing international franchise.

I also checked out the vending machine business opportunity part. I always saw ads for this stuff when I was looking for jobs after college. I always see vending machine people filling up snack machines and stuff. I wouldn’t mind owning the business, but actually doing the work is not for me…

I spent less time checking out the sports business opportunity and food franchise business opportunity sections because I wanted to write this blog entry, but the tea franchise was interesting. I’m not exactly a tea aficionado, but I do like it much more than coffee and my wife loves tea.