Learn to Manage Own Personal Finances

"Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime." ~  old proverb

Personal finance knowledge and understanding is important for financial success. Personal finance is a skill each person should learn and execute well, starting early in life, even as a child.  It is important for the individual to routinely make good decisions to be successful in their personal finances.

No one knows more or cares more about my financial situation than me.  Not any broker.  Not any investment advisor.  Nor any financial advisor. Personal finance success depends on the my knowledge,  commitment and implementation, not based on an advisor doing the work for me.

As long as I am able to do the work, I will continue to manage our personal finances myself.  If circumstances require an advisor's involvement for additional perspective, I do use their services and I make the final decision on what to do.  For example, I got input from advisors on when to start taking Social Security and on how long our current retirement funds will last, before making my decisions.

For more on Reaping the Rewards, check back every Friday for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC

My New Definition for "Wealthy"

I used to think wealthy was a specific number.  When I was a child, I though $1 million was wealthy. Nowadays, 10% of U.S. adults are millionaires in net worth but are cash poor, i.e. most of their wealth is in assets, such as their home.

 My new definition is no longer a number, but a state of mind of absolute financial security.  To me wealthy means:

• One has sufficient funds to cover necessary and discretionary expenses for one's life expectancy.
• One has sufficient funds to choose whether or not to work for compensation.
• One has sufficient funds to cover unexpected or emergency expense without using debt.
• One has sufficient funds to cover large expenditures, such as a new car purchase, without using debt.

Of course, "wealthy" people can choose to work or use debt, but they can also choose not to.

 For more on  Crossing Generations, check back every Thursday for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC

Best Age and Worst Age for a Bear Market

Bear markets are inevitable but unpredictable in timing.  It's best to expect them and prepare to protect from or benefit from them depending or your age.

Best Age

In one's twenties, making it a great time to invest in a stock market index of the S&P.  Once can confidently stay invested in the inevitable bear markets that will occur.  Rolling 20 year returns on S&P 500 since 1926 have always been positive.  Roll 10 year returns have been positive except for the years starting with the Great Recession and the Dot Com Bubble.

Worst Age

+/- 5 years from retirement.   The sequence of market returns can significantly impact how long retirement funds will last.  Retire during a bear market and needing to withdraw funds will cause one to run out of money much sooner than someone who starts withdrawing during a bull market.

Disclosure:  I retired in 2007, just before the Great Recession.  I didn't know about the worst age recommendation.  Luckily, I had enough cash and CDs that matured during the first 5 years, such that I did not have to sell equities to cover living expenses. 

For more on The Practice of Personal Finance, check back every Wednesday for a new segment.

This is not financial, retirement nor investment advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC

Maximum Amount to Borrow for Student Loan

The maximum amount should be a financial decision and not an emotional decision. Consider the impact it may have on your finances over 10 years after you graduate when deciding how much to borrow. IMHO, the best option if taking a loan is one can repay in 10 years or less easily. 

Here is a simple calculation to do before taking out a student loan.

I have read of two different rules of thumb.

1. No more that one's expected salary.
2. No more that 10% of expected take home pay.  

Assuming one's first job is $60,000 per year which is the average for a college graduate. Take home pay for $60,000 is estimated at $4,187 per month not including state income tax deduction.  

Rule #1 maximum is $60,000 borrowed.  That results in a $678 per month payment at 6.39% interest for 10 years.   That's 16.2% of one's take home pay.

Rule #2 maximum is $37,000 borrowed.  That results in a $418 per month payment since 10%  of $4,187 per month take home is $419.   

Both of these seem reasonable for loan payments.   However, what if the starting salary is only $40,000 when one assumed $60,000.     Now, one's take home pay is only $2848 per month.  Now the monthly payment is either 23.8% for Rule #1 or 14.6% for Rule #2 based on borrowing against one's expected salary of $60,000.  Ouch. 

With a recommended budget that has 20% of take home pay going to savings and debt, the above student loan examples would take about take up 50 to 138% of that 20% based on assumed or actual starting salaries.   

Instead of thinking of a student loan as an investment, think of paying off a student loan as a future budget item and whether the future payment is affordable.

Disclosure:  Student loans I took had payments of about 5% of my take home starting salary.  Although many years ago, I recall that percentage to very manageable.

For more on  Ideas You Can Use, check back every Tuesday for a new segment.

This is not financial, higher education, nor debt advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC

Best Time to Plant Grass Seed

Most people assume the best time to plant grass seed is early spring.  The results come a within couple weeks of planting, which is satisfying.  However, the weather can get hot and scorch the new seedlings leading to a thin lawn or one with bare spots later in the summer.

For me, the best time is to seed is mid September to early October.  The weather is cooler and the ground stays moist longer.  The downside is one may not see much grass growing before winter.  However, the seedlings will grow stronger over the winter and give a luscious lawn in the spring.

When neighbors complement me on my lawn and ask who does our lawn services, I proudly tell them I do my own seeding and fertilizing service.

For more on Strategies and Plans, check back every Monday for a new segment.

This is not financial nor lawn maintenance advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC

Volatility Will Test My NEW Investment Strategy

My goal is to invest for income and growth.  I am targeting income to be stable, paid monthly and sufficient to cover expected living expenses when combined with social security. This will be done through bond ETFs such as SCMB and SCHZ/BND.   For growth, I plan to but have not executed investing primarily in index ETFs such as VOO (S&P 500) and MGK (Large Cap Growth).   

I have started investing in the bond ETFs.  I am still waiting for the long expected correction before investing in VOO and MGK.

I hope this strategy will make me immune to drops and keep me steadfast in following the strategy.

Friday's volatility was a good test of my commitment to the strategy.  Even with the morning steep declines of several growth stocks, I did not panic sell.  In fact, I started planning on investing in VOO and MGK by setting buy targets.

It's a good thing I didn't not sell any core investments.  The market rebounded and closed about even after being down as much a 1.5% during the day.  Another day of volatility that turned out be a nothing burger. 

For more on New Beginnings, check back every Sunday for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC

Hoping for the Best and Preparing for the Worst

There are currently two seemingly opposing beliefs about the stock market:

• Belief #1: Stocks will keep going up and always buy the dip.
• Belief #2: Stocks are extremely overvalued and a major decline will happen.
  

Both beliefs are right, but differ in timing of benefit, i.e. long term versus short term.

Let's look at each belief.

• Stocks will keep going up and always buy the dip. Over the long term, this belief is correct.  In 20 year rolling periods since 1919, the S&P 500 (or its representation before it was created) is always a gain.   
• Stocks are extremely overvalued and a major decline will happen.  In the short term, this can be true.  The declines average about 1 year and usually last less than 2.7 years.  It usually takes 2.5 to 4.5 years to recover, but may take up to 10 years to return to previous highs as in the lost decade in the early 2000s.

In hoping for the best, I am staying invested with our core holdings.   If the market keeps going up, we will benefit.  If it falls, we can weather a decline that takes up to 5 years to recover.  Additionally, we will stay invested in our our children's long term savings accounts.

In preparing for the worst, we are keeping sufficient cash equivalent funds to cover 5+ years of living expenses and to invest in an index fund such as VOO as the market declines, especially for our children's accounts which will be invested for at least 20 years.

For more on Reflections and Musings, check back every Saturday for a new segment.

This is not financial nor investment advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC

Know Mutual Fund Year Capital Gains Distributions Before December

Since I am retired, I can manage my taxable income received each year.  For tax planners like me, getting Mutual Fund capital gains distributions in mid to late December can ruin a good tax plan, especially if one is on the borderline of receiving tax credits or being in a lower tax bracket.

However, I don't have to wait until December to find out the amount of expected capital gains distributions.  The amount is usually determined at the end of September or October, but isn't paid until December.   I often can find out the expected capital gains distribution in early October or early November by checking the Mutual Fund website. 

With the expected capital gains information, I can plan other sources of taxable income, such as stock tax loss harvesting,  to ensure we know our tax bracket and eligibility for tax credits and deductions for the calendar year.

For more on Reaping the Rewards, check back every Friday for a new segment.

This is not financial nor tax advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC

New Dishwasher Review

Recently I wrote about Replacing Instead of Repairing a Dishwasher based on the cost of repair versus putting that money money towards a new dishwasher.   I'm usually a fan for using cars and appliances until they are beyond repair.  For example, I drive a 2003 F-150, which I have been repairing instead of replacing.

We have bought a Bosch 800 dishwasher to replace a Bosch 800 dishwasher from 2016.   For reference, I received no compensation for this post.

Even though our replaced dishwasher was working well, I've noticed that our new dishwasher cleans much better.  Significant changes have been made to the lower spray arm are such that pots and pans are much cleaner than our previous dishwasher did.   The improvement is a multi armed spray device that can focus on extra soiled pots and pans. 

In addition, the new dishwasher seems to dry out washed items much better that the replaced dishwasher.  One reason is we are now using Jet Dry from the very start.   In our previous dishwasher, we didn't start using Jet Dry until last year, even though the instructions said to use.   As with our previous dishwasher, the new one is extremely quiet.

The dishwasher has many more options than we use. Although the dishwasher has several cycle choices, we typically only use the Auto cycle.   The new dishwasher can be connected to an app via the Internet, but we do not to use that feature.  

Overall, we are very happy with the new purchase.  

For more on Crossing Generations , check back every Thursday for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC

Hypothetical Impact of Distributing Billionaires Wealth

A common misperception is that billionaires could solve poverty, health care crisis and other wealth gap issues if they transferred their wealth to the rest of the population.  

Let's do the math.

How Much Every American Would Get If Jeff Bezos’ Wealth Was Evenly Distributed

According the article distributing Bezos' net worth of $234B to the entire U.S. population of 340.1 million would result in each person receiving $688.   Not even enough to pay one months rent.

Now let's look at all billionaires.  There are 1135 billionaires in the U.S with a total net worth of $5.7 trillion.  $5.7 trillion is close to the U.S. annual budget of 7.01 trillion and would reduce the $37 trillion national debt ONE TIME.   Distributing $5.7 trillion to 340.1 million people would result in each person receiving a ONE TIME payment of $16,764.   Distributing $5.7 trillion to 128 million households would result in each house receiving a ONE TIME payment of $44,531. 

What could people do with the money?

Average student loan debt: $39,000  Total student loan debt: $1.8 trillion

Average credit card debt: $6,500  Total credit card debt:  $1.21 trillion

Average car loan debt: $24,297.  Total car loan debt: 1.61 trillion

Average rent paid:2000/month    Total rent paid:  $500 billion - $1.4 trillion.

Total amount eliminated: $5.12 - $6.02 Trillion ONE TIME.

IMHO, monetary benefits that are ONE TIME usually do not solve underlying personal finance issue(s).   Taking and using all the wealth billionaires have is not a sustainable solution.

For more on The Practice of Personal Finance, check back every Wednesday for a new segment.

This is not financial nor personal finance advice. Please consult a professional advisor.

Copyright © 2025 Achievement Catalyst, LLC