Road To Financial Freedom

What is financial freedom? I defined financial freedom as the ability to enjoy whatever lifestyles we desire over our life time without the need to work. Sounds good? Yes! This is the reward of financial freedom, and I strongly belief every one of us can legitimately achieve it if we follow a proven approach.

Before I go into details, let me explain how people accumulate wealth. We can create wealth by inheritance, strike lottery, criminal act, working, start-up business, or investment. Getting rich by inheritance and strike lottery are act of God, they are beyond our control. Though we are not able to select rich parents, we can definitely select rich spouses. However, you must born with killer look and body shape to stand a chance to marry millionaires. If you are lucky to strike lottery, you will likely loss all your money because your financial intelligence is not conditioned to handle such windfall. Similarly, wealth accumulates by criminal act will normally end up the same way as the victims. Wealth created by such act is punishable by law and against our conscience. For employees, the chance of getting rich by climbing corporate ladders are as slim as inheritance. Statistically, the probability of becoming fortune 500 companies CEO is 500/6,700,000,000 = 0.00000000746269! The good news is we score higher chance of being rich by starting-up business or investment (stocks and property).

In order to achieve financial freedom by starting-up business or investment, your mental state must be conditioned to handle abundant of wealth. You must understand and practice the right approach to financial freedom. Let me explain to you the progressive path to financial freedom:

o Financial Broke

o Financial Rat

o Financial Protection

o Financial Secured

o Financial Freedom

Financial Broke:
It is defined as one who needs social, parental or third party support to live. This group of people are either jobless without income, mentally or physically challenge or income stream not able to cover expenses. Discounting mentally or physically challenge people, this group are the worse of all. However, given the right financial education and mind set change, Financial Broke people can be uplifted to next financial level.

Financial Rat:
It is defined as one who depends on regular working income or salary to live. He or she cannot survive without working income. Majority of them fall into this category. This group of people can be doctor, lawyer, manager, engineer, self-employed or employees who live in big or small houses and drive expensive or cheap cars. Basically, they need working income to cover their expenditures. They live like rats racing around circles. Given sufficient financial education, this group of people can be easily uplifted to next higher level. The ironic is the higher the level of comfort zone (false sense), the more difficult they are able to take the first step to financial security.

Financial Protection:

It is defined as one who has enough cash saving to last him or her for at least 12 months without working. The 12 months safe period buy them time to get alternate source of income to support their expenses. This safety net is critically crucial. The cash saving must be kept secretly untouched for as long as we live. It may save our life when the world suddenly falls apart. So, keep this amount in cash and hide it in a secret location even when one reached financial security or financial freedom.

Financial Security:
It means having passive income that is similar to the amount of expenses. That means we do not have to work anymore. We need not be rich to arrive at this level. For example, one needs $2,000 per month to live while other needs $6,000 to live. The higher the desire standard of living, the higher the amount of passive income we need to have. Remember, personal finance is about cash flow, similar to business. One has the option to stay at this level for good or proceed to the level of Financial Freedom. The beauty of Financial Security is that we do not work for money anymore, we work for passion. As a result, this group of people achieves financial freedom faster and easier than others.

Financial Freedom:

It means having passive income that far exceeds ones expenses, and we are able to live in the lifestyles we desired. This is the level for rich and famous. The challenges at this level are to give back to society, help the needy and make the world a better place to live in.

North East local financial advice covering Newcastle, Sunderland, Gateshead & Durham

Financial Freedom Radio – Do You Know What You Don’t Know?

Financial education is lacking in the general public with even people who have degrees in finance and business being financially uneducated. The “ostrich syndrome” is alive and well in the financial world and that is where these institutions want you to be.

Financial education is something that the masses don’t have and because of the lack of it they end up becoming slaves to the financial institutions. Lumped into this category are the people who have degrees in business and finance. Just because an individual has formal education in finance it doesn’t mean that they are financially educated. They have been educated by the teaching institutions into the ways of the financial institutions.

Any person who has financial education, and educated by a teaching institution has been educated to leave the teaching institution and get a job within an industry and assist in making that company within the particular industry stronger. If they are not an asset then they have no value to the institution they are employed by. So all of the financial education is pro-business!

Translate this to the financial industry and look at the financial education that people receive by the teaching institution; it is pro-financial institution. How do the financial institutions make their money? They make their money on the backs of the consumer, by selling products to the end user. The consumer is the end user! You see anything that makes one group stronger will make the other group weaker. So what makes the financial institutions stronger makes the consumers weaker, because the financial institutions make their money selling products to the consumer. They must “extract the cash” from the consumer in some way or another and justify it as right.

So all of these financial planners and advisors are trained by the teaching institutions to make the financial institutions stronger and if they fall down on the job they get fired. The financial institutions operate under four basic rules;

  1. They must get your money.
  2. They must get your on a systematic and on going basis.
  3. They must hang on to it as long as possible.
  4. They must give it back as little as possible.

If these financial institutions violate these rules they are out of business. Therefore they have to get the consumers money, so doesn’t it make sense that the financial information that they sell to the public, is pro-financial institutions. Take a look around and survey what you do financially. I bet that the majority of the financial things that you do, are centered around the financial institutions in some fashion or another. Sometimes everything that is being done revolves around the financial institution in some way or another, and the financial institution get fees and charges from the consumers in almost everything they do.

Is the majority of your financial activity focused around the financial institutions? If you answered yes than regardless of your financial education, you are financially uneducated. Regardless, of your financial education if you are fueling the financial institutions you are working for them and all of you financial education has guided you right to them. I have worked with clients who think they know it all financially, and end up losing huge sums of their hard earned cash.

If everything that the financial institutions were doing was right then people would not be out living their hard earned money. They would be wealthy beyond dreams. But unfortunately the gains are taken by the financial institutions and little is given to the consumer. I have heard plenty of supposedly highly educated people defend these practices even though they were losing. Usually the people defending these strategies are the people who work for the financial institutions. Don’t get me wrong financial institutions have their place but it’s not fleecing the public.

Actually if you have no financial education you are better off because you have no preconceived financial notions. You are an empty canvas to be painted on and will find it easier to make shifts in thinking. Financial Freedom Radio is conducting a series on “Why You Should Be Rich”, you can listen live to this series of download past episodes. The show is Friday 9:00 AM EST. You can also download to you i-Pod through i-Tunes for free. Simply go to Podcast and type in “Financial Freedom Radio”.

Famous Quotes in History About Money

“It is a cruel thought, that, when we feel ourselves standing on the firmest ground in every respect, the cursed arts of our secret enemies, combining with other causes, should effect, by depreciating our money, what the open arms of a powerful enemy could not.” –Thomas Jefferson to Richard Henry Lee, 1779. ME 4:298, Papers 2:298

“Historically, the United States has been a hard money country. Only [since 1913] has the United States operated on a fiat money system. During this period, paper money has depreciated over 87%. During the preceding 140 year period, the hard currency of the United States had actually maintained its value. Wholesale prices in 1913 … were the same as in 1787.” — Kenneth Gerbino, former chairman of the American Economic Council
“We make money the old fashioned way. We print it.” — Art Rolnick, former Chief Economist, Minneapolis Federal Reserve Bank

“Paper money has had the effect in your state that it will ever have, to ruin commerce, oppress the honest, and open the door to every species of fraud and injustice.” — George Washington, in a letter to J. Bowen, Rhode Island, Jan. 9, 1787
“Of all contrivances for cheating the laboring classes of mankind, none has been more effective than that which deludes them with paper money.” — Daniel Webster”
“I see in the near future a crisis approaching. It unnerves me and causes me to tremble for the safety of my country … the Money Power of the country will endeavor to prolong its reign by working upon the prejudices of the people, until the wealth is aggregated in a few hands and the Republic is destroyed.” — Abraham Lincoln, just after the passage of the National Banking Act of 1863

“All the perplexities, confusion and distress in America rise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from downright ignorance of the nature of coin, credit and circulation.” — John Adams, in a letter to Thomas Jefferson in 1787
“Paper money eventually returns to its intrinsic value – zero.” — Voltaire (1694-1778)
“If the American people ever allow private banks to control the issue of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers conquered.” — Thomas Jefferson in 1802 in a letter to then Secretary of the Treasury, Albert Gallatin

The value of paper money is precisely the value of a politician’s promise, as high or low as you put that; the value of gold is protected by the inability of politicians to manufacture it. — Sir William Rees-Mogg

The monetary managers are fond of telling us that they have substituted ‘responsible money management’ for the gold standard. But there is no historic record of responsible paper money management … The record taken as a whole is one of hyperinflation, devaluation and monetary chaos. — Henry Hazlitt

“The creation of money exclusively as debt is the critical, destabilizing flaw in the American Economy”. — author Theodore R. Thoren explains The Truth In Money Book.
“The decrease in purchasing power incurred by holders of money due to inflation imparts gains to the issuers of money … .” — St. Louis Federal Reserve Bank in “Review”, Nov. 1975
“You have to choose [as a voter] between trusting to the natural stability of gold and the natural stability of the honesty and intelligence of the members of the Government. And, with due respect for these gentlemen, I advise you, as long as the Capitalist system lasts, to vote for gold.” — George Bernard Shaw

“Without the confidence factor, many believe a paper money system is liable to collapse eventually.” — Federal Reserve Bank of Philadelphia in “Gold”
“Whoever controls the volume of money in any country is absolute master of all industry and commerce.” — President James A. Garfield
“Those who create and issue money and credit direct the policies of government and hold in the hollow of their hands the destiny of the people.” — Rt. Hon. Reginald McKenna, former Chancellor of Exchequer, England

“If Congress has the right under the Constitution to issue paper money, it was given to be used by themselves, not to be delegated to individuals or corporations.” — Andrew Jackson

QUOTES ON FISCAL AND MONETARY POLICY:

“The budget should be balanced, the treasury should be refilled and the pubic debt should be reduced. The arrogance of public officialdom should be tempered and controlled. And the assistance to foreign lands should be curtailed, lest we become bankrupt.” — Cicero, 63 B.C.
“Inflation has now been institutionalized at a fairly constant 5% per year. This has been scientifically determined to be the optimum level for generating the most revenue without causing public alarm. A 5% devaluation applies, not only to the money earned this year, but to all that is left over from previous years. At the end of the first year, a dollar is worth 95 cents. At the end of the second year, the 95 cents is reduced again by 5%, leaving its worth at 90 cents, and so on. By the time a person has worked 20 years, the government will have confiscated 64% of every dollar he saved over those years. By the time he has worked 45 years, the hidden tax will be 90%. The government will take virtually everything a person saves over a lifetime.” — G. Edward Griffin, historian and author of “The Creature From Jekyll Island”

“By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose … If, however, a government refrains from regulations and allows matters to take their course, essential commodities soon attain a level of price out of the reach of all but the rich, the worthlessness of the money becomes apparent, and the fraud upon the public can be concealed no longer.” — John Maynard Keynes, economist and author of “The Economic
Consequences Of The Peace” (1920)

“About all a Federal Reserve note can legally do is wipe out one debt and replace it with itself, another debt, a note that promises nothing. If anything’s been paid, the payment occurs only in the minds of the parties ….” — Tupper Saucy, author of “The Miracle On Main Street”
“… the gold standard is incompatible with chronic deficit spending (the hallmark of the welfare state).” — Greenspan, Alan; “Gold and Economic Freedom”, Rand, Ayn; Capitalism: the Unknown Ideal; Signet Books, 1967; pp96-101. See full text in FAME’s FedWatch section http://www.fame.org/.

QUOTES ON BANKING:

“I sincerely believe … that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale.” — Thomas Jefferson to John Taylor, 1816.
“Banks lend by creating credit. They create the means of payment out of nothing.” — Ralph M. Hawtrey, former Secretary of Treasury, England
“Money is the most important subject intellectual persons can investigate and reflect upon. It is so important that our present civilization may collapse unless it is widely understood and its defects remedied very soon.” — Robert H. Hemphill, former credit manager, Federal Reserve Bank of Atlanta

“Bankers own the earth. Take it away from them, but leave them the power to create money and control credit, and with a flick of a pen they will create enough to buy it back.” — Sir Josiah Stamp, former President, Bank of England
“The Founding Fathers of this great land had no difficulty whatsoever understanding the agenda of bankers, and they frequently referred to them and their kind as, quote, “friends of paper money. They hated the Bank of England, in particular, and felt that even were we successful in winning our independence from England and King George, we could never truly be a nation of freemen, unless we had an honest money system. Through ignorance, but moreover, because of apathy, a small, but wealthy, clique of power brokers have robbed us of our Rights and Liberties, and we are being raped of our wealth. We are paying the price for the near-comatose levels of complacency by our parents, and only God knows what might become of our children, should we not work diligently to shake this country from its slumber! Many a nation has lost its freedom at the end of a gun barrel, but here in America, we just decided to hand it over voluntarily. Worse yet, we paid for the tyranny and usurpation out of our own pockets with “voluntary” tax contributions and the use of a debt-laden fiat currency!.” — Peter Kershaw, author of the 1994 booklet “Economic Solutions”

“The real truth of the matter is, and you and I know, that a financial element in the large centers has owned the government of the U.S. since the days of Andrew Jackson. History depicts Andrew Jackson as the last truly honorable and incorruptible American president.” — President Franklin Delano Roosevelt, November 23, 1933 in a letter to Colonel Edward Mandell House
“The truly unique power of a central bank, after all, is the power to create money, and ultimately the power to create is the power to destroy.” — Pringle, Robert; and Deane, Marjorie: The Central Banks; Viking, 1994, page viii.

“When you or I write a check there must be sufficient funds in our account to cover that check, but when the Federal Reserve writes a check, it is creating money.” — Boston Federal Reserve Bank in a publication titled “Putting It Simply”

“Some people think the Federal Reserve Banks are U.S. government institutions. They are not … they are private credit monopolies which prey upon the people of the U.S. for the benefit of themselves and their foreign and domestic swindlers, and rich and predatory money lenders. The sack of the United States by the Fed is the greatest crime in history. Every effort has been made by the Fed to conceal its powers, but the truth is the Fed has usurped the government. It controls everything here and it controls all our foreign relations. It makes and breaks governments at will.” — Congressman Charles McFadden, Chairman, House Banking and Currency Committee,

June 10, 1932
“.. we conclude that the [Federal] Reserve Banks are not federal … but are independent, privately owned and locally controlled corporations … without day to day direction from the federal government..” — 9th Circuit Court in Lewis vs. United States, June 24, 1982
“… You are a den of vipers and thieves. I intend to rout you out, and by the grace of the Eternal God, I will rout you out.” — President Andrew Jackson, upon evicting a delegation of international bankers from the Oval Office
“Give me control over a nation’s currency and I care not who makes its laws.” — Baron M.A. Rothschild (1744 – 1812)

Submitted by: Regis Sauger (Submitter does not make any claims as to having any input or credits for above quotes which are considered available to the public under the Freedom of Information Act.)

Financial Freedom And Procrastination!

One of my many frustrations deals with people who say they want to achieve financial success but don’t seem to have the time to work it into their schedule. It can’t be both ways!

I have talked to many people who tell me that they are sick and tired of not getting ahead. They tell me that the financial world is against them and that the financial institutions do not operate in their best interest. They tell me that they want to achieve financial freedom and have their wealth work for them and not them working for it. It seems like these people are telling me what they think I want to hear, and not what they truly want for themselves.

If we accept them into our Personal Economic Coach process, after they profess to want to achieve financial success, it seems that these people are very attentive for the first few meetings. [Not everyone falls into this category.] They approach the process with great gusto but over time cannot continue to stay focused on the training necessary to become financially free.

Achieving financial freedom requires education and time to get it. We offer the tools and the resources for anyone to gain financial freedom. All anyone has to do is commit the time, without excuses. There is no question that ten percent of the people control ninety percent of the world’s wealth because they’re willing to take the time and educate themselves. This small group of people ranges from all walks of life, but the thing that separates them is their commitment to learning what they need to learn to become financially free. That is why they are wealthy!

Procrastination is a terrible disease! It afflicts ninety percent of the world’s population. There is no pill that you can take to get rid of it. The only way that it can be eliminated is when the individual that is afflicted with it, decides they have had enough. When people have realized financially that they have lost substantial amounts of money to the financial institutions, then they decide that they need to take action. This point is usually too late.

Financial liberty is something that everyone has been endowed with by their creator. But there are many people, out there in the world, who want to take these liberties away from individuals. People are losing their financial liberties all the time and they don’t know it. The financial institution, financial planners, and many accountants strip consumers from their financial liberties all day long.

Financial freedom and financial liberty go hand in hand, and everyone must work to protect it. Putting things off, and procrastinating, will always transfer your financial liberties to someone else. When they sense that you don’t know what you’re doing they will take advantage of you. When you show them that you do know what you’re doing they will leave you alone.

Personal Economic Coach allows individuals to learn how to recognize when someone is trying to take advantage of them. It teaches people how to recover dollars that are currently being extracted from them without their knowing it, and put them to growth. Everyone is losing huge amounts of money on a daily basis and they don’t know it. When these dollars are recovered and put the growth they will add millions of dollars to an individual’s bottom line, depending on the age of the individual.

Your freedoms and liberties are not just what we think about as they relate to our Bill of Rights. They translate into all walks of your life which includes your financial life as well. There are people around the world that are very interested in taking away your freedoms and liberties, as well as people within your own country. You need to protect these financial liberties and the best way to protect them is to learn as much as you can about them. This article is dealing in finance only so far our purposes we’re concerned about your financial freedoms and financial liberties as you can tell.

If you’re a financial procrastinator then you need to immediately take action and decide today that you want to protect your financial freedom and financial liberties through financial education. Through Personal Economic Coach you can achieve this goal. You don’t want to get to your later years and wonder where all of your hard earned money went. Whenever I work with a client who begins to start procrastinating, I bring this to their attention to see whether it is truly their desire to become financially free.

Andrew Carnegie, the wealthiest man in the world in the late eighteen hundreds and early nineteen hundreds, said “the problem with the American business person is lack of concentration”. This statement holds true today and probably is pretty safe to say will always be a problem.

The solution is at hand, and you can take action today by contacting us at Personal Economic Coach. What you contact us we will take over the only thing we require is a desire on your part to achieve financial freedom.

Branches of Accounting, Uses of Accounting and Limitations of Financial Accounting

Accounting vs. Book-keepingBook-keeping concerns itself with the recording (correctly and in a set of books) of those transactions that result in the transfer of money or money’s worth. Whereas accounting is comprehensive in perspective. It extends to classifying, summarizing, presenting and even analyzing accounting information .

Accounting vs. Accountancy

Body of knowledge (consisting of principles, postulates, assumptions, conventions, concepts and rules) governing the science of recording classifying and analyzing financial transactions is accounting. Whereas the practice and art of the science of accounting is termed as accountancy.To meet the ever increasing demands made on accounting by different interested parties (such as owners, management, creditors, taxation authorities etc.) the various branches have come into existence. Financial AccountingThe object of financial accounting is to ascertain the result (profit or loss) of business operations during the particular period and to state the financial position (Balance Sheet) as on a date at the end of the period.

Cost Accounting

The object of cost accounting is to find out the cost of goods produced or services rendered by a business. It also helps the business in controlling the costs by indicating avoidable losses and wastes.Management AccountingThe object of management accounting is to supply relevant information at appropriate time to the management to enable it to take decision and effect control.In this web primer, we are concerned only with financial accounting. The objects of financial accounting as stated above can be achieved only by recording the financial transactions in a systematic manner according to a set of principles. The recorded information has to be classified, analyzed and presented in a manner in which business results and financial position can be ascertained.

Uses of Accounting

Accounting plays important and useful role by developing the information for providing answers to many questions faced by the users of accounting information.

(1) How good or bad is the financial condition of the business?

(2) Has the business activity resulted in a profit or loss?

(3) How well the different departments of the business have performed in the past?

(4) Which activities or products have been profitable?

(5) Out of the existing products which should be discontinued and the production of which commodities should be increased.

(6) Whether to buy a component from the market or to manufacture the same?

(7) Whether the cost of production is reasonable or excessive?

(8) What has been the impact of existing policies on the profitability of the business?

(9) What are the likely results of new policy decisions on future earning capacity of the business?

(10) In the light of past performance of the business how it should plan for future to ensure desired results ?

Above mentioned are few examples of the types of questions faced by the users of accounting information. These can be satisfactorily answered with the help of suitable and necessary information provided by accounting.

Besides, accounting is also useful in the following respects :-

(1) Increased volume of business results in large number of transactions and no businessman can remember everything. Accounting records obviate the necessity of remembering various transactions.

(2) Accounting record, prepared on the basis of uniform practices, will enable a business to compare results of one period with another period.

(3) Taxation authorities (both income tax and sales tax) are likely to believe the facts contained in the set of accounting books if maintained according to generally accepted accounting principles.

(4) Cocooning records, backed up by proper and authenticated vouchers are good evidence in a court of law.

(5) If a business is to be sold as a going concern then the values of different assets as shown by the balance sheet helps in bargaining proper price for the business.

Limitations of Financial Accounting

Advantages of accounting discussed in this section do not suggest that accounting is free from limitations.

Following are the limitations:

Financial accounting permits alternative treatmentsAccounting is based on concepts and it follows ” generally accepted principles” but there exist more than one principle for the treatment of any one item. This permits alternative treatments with in the framework of generally accepted principles. For example, the closing stock of a business may be valued by anyone of the following methods: FIFO (First-in- First-out), LIFO (Last-in-First-out), Average Price, Standard Price etc., but the results are not comparable.

Financial accounting does not provide timely information

It is not a limitation when high powered software application like HiTech Financial Accenting are used to keep online and concurrent accounts where the balance sheet is made available almost instantaneously. However, manual accounting does have this shortcoming.

Financial accounting is designed to supply information in the form of statements (Balance Sheet and Profit and Loss Account) for a period normally one year. So the information is, at best, of historical interest and only ‘post-mortem’ analysis of the past can be conducted. The business requires timely information at frequent intervals to enable the management to plan and take corrective action. For example, if a business has budgeted that during the current year sales should be $ 12,00,000 then it requires information whether the sales in the first month of the year amounted to $ 10,00,000 or less or more?

Traditionally, financial accounting is not supposed to supply information at shorter interval less than one year. With the advent of computerized accounting now a software like HiTech Financial Accounting displays monthly profit and loss account and balance sheet to overcome this limitation. Financial accounting is influenced by personal judgments’Convention of objectivity’ is respected in accounting but to record certain events estimates have to be made which requires personal judgment. It is very difficult to expect accuracy in future estimates and objectivity suffers. For example, in order to determine the amount of depreciation to be charged every year for the use of fixed asset it is required estimation and the income disclosed by accounting is not authoritative but ‘approximation’.

Financial accounting ignores important non-monetary information

Financial accounting does not consider those transactions of non- monetary in nature. For example, extent of competition faced by the business, technical innovations possessed by the business, loyalty and efficiency of the employees; changes in the value of money etc. are the important matters in which management of the business is highly interested but accounting is not tailored to take note of such matters. Thus any user of financial information is, naturally, deprived of vital information which is of non-monetary character. In modern times a good accounting software with MIS and CRM can be most useful to overcome this limitation partially.

Financial Accounting does not provide detailed analysis

The information supplied by the financial accounting is in reality aggregates of the financial transactions during the course of the year. Of course, it enables to study the overall results of the business the information is required regarding the cost, revenue and profit of each product but financial accounting does not provide such detailed information product- wise. For example, if business has earned a total profit of say, $ 5,00,000 during the accounting year and it sells three products namely petrol. diesel and mobile oil and wants to know profit earned by each product Financial accounting is not likely to help him unless he uses a computerized accounting system capable of handling such complex queries. Many reports in a computer accounting software like HiTech Financial Accounting which are explained with graphs and customized reports as per need of the business overcome this limitation.

Financial Accounting does not disclose the present value of the business

In financial accounting the position of the business as on a particular date is shown by a statement known as ‘Balance Sheet’. In Balance Sheet the assets are shown on the basis of “Continuing Entity Concept. Thus it is presumed that business has relatively longer life and will continue to exist indefinitely, hence the asset values are ‘going concern values.’ The ‘realized value’ of each asset if sold to-day can’t be known by studying the balance sheet.