The Way To Financial Independence s1e4u

The Way to Financial Independence

Pearl Iseabell Roberts

Copyright © 2012 by Pearl Iseabell Roberts.

ISBN: Softcover 978-1-4797-2442-0 Ebook 978-1-4797-2443-7

All rights reserved. No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without permission in writing from the copyright owner.

To order additional copies of this book, : Xlibris Corporation 1-888-795-4274 www.Xlibris.com [email protected] 120064

CONTENTS

Introduction

Dedication

Education

Have A Purpose And Vision

Employment

Building Good Credit

Setting Your Financial Goals

Your Plans Or Strategies

Create A Saving Plan And Budget

Empower Yourself

Debt Trap

Buying A House And A Car

The Necessities Of Life

Ways To Save

Budget To Save, Save To Invest, Invest For Income

Learn How To Invest

Help Yourself

About The Author

INTRODUCTION

I like to help people by nature. My life’s work was helping sick people and taking care of my family. Like every parent, I wanted my children to have a college education. My husband and I were living with his parents and had one child. We had a used car. I had a vision for us to buy a single house in the suburb, to have two cars in the drive way, and to have more children and educate them. I had the vision and this is the start to financial independence. I not only have the desire to help my family, including myself, but also to help others in need.

When it comes to money, I like to give some, save some, and spend some. You can notice that “spend some” was last. You take care of the first two and if there is some left, then you can spend some.

I find myself writing the book at the right time, at a time when people are losing their jobs and houses and are in lot of debt. I believe my book will help someone.

DEDICATION

I am dedicating “The way to Financial Independence” to my parents, Willie and Pauline Poole. They were loving parents and gave me a good foundation. They taught me about God and to love people, to be honest, to be helpful, and to give when needed. They taught me to never be weary in doing good, for you will reap if you faint not. They taught me how to pray and they prayed with us (my sibling and me). They taught us to work hard for what we needed and what we wanted.

I am also dedicating this book to my husband, Walter Thomas Roberts, a hardworking person, who loved and took care of his family.

In addition, I dedicate this book to my son Walter Leon Roberts, my firstborn, who brought so much love to our lives.

They are all deceased. But they will forever live in my heart.

EDUCATION

Get as much education as possible. When you are born into this world, you start to learn and you never stop. Nobody knows it all, and there is always something that you can learn. As I converse with people, I find myself saying, “I didn’t know that.” You learn a lot just by talking to people.

Before you decide to take up any course in a school, you should check to see if there are good job prospects in that field. Study something that you like and get a job in that area. You will do better in your job and will be happier.

To advance yourself, take more courses in your area. Sometimes, you need to work in the daytime and go to school at night or work at night and go to school during the day. It can be very hard, working and going to school. You need to you are on a mission. The rewards will be gratifying. You will only be doing this for a period of time. When you have a vision and goal, you may need to do things that are not always pleasant.

HAVE A PURPOSE AND VISION

The vision was natural for me and my purpose clear.

I knew what I wanted and I was married to someone that wanted the same things.

I could see myself having the children that I wanted. I could see myself buying the single house in the suburbs that I wanted. Like every parent, you want your children to have a college education. So I could see my children going through the school system and proceed on to higher education.

I could see myself getting out of debt. I reading the scripture—“The rich ruleth over the poor, and the borrower is servant to the lender.” (Proverbs 22:7) I did not want to be a servant to the lender; I wanted to be a servant to God. As I start to get out of debt, I was on my way to financial independent.

The purpose was to help myself, my family, and others and to make life more comfortable and enjoyable for others by the work that I have done.

EMPLOYMENT

If you were not born in a wealthy family or came into an inheritance, then you need to be employed to generate income. You can make a living and travel the path to financial independence. The money you make and how well you manage it will get you to your goals quicker.

You can work overtime or work during holidays, which will pay for time and a half or double time. You can have two jobs or a full-time job and a part-time job, which is another way of generating income and having financial independence. you are working hard on your path to financial independence.

If you feel that you are doing too much, take a vacation and come back rested. Be alert to ways that you can increase your pay. Ask for a raise or promotion. Be on the lookout for a job that will pay more money than you are making.

BUILDING GOOD CREDIT

Before you can buy big purchases, you need to establish credit. One way to do this is to apply for a credit card, one that has “cash back bonus.” Use your credit card only for what you can afford to pay off each month. This way you will establish a good paying record and will save on interest.

You can get a loan and have someone co-sign for you. If possible, pay for it before time, to help establish a good paying record and to save on interest. After doing that, you will be able to borrow and get what you need.

If you have a good credit score, you can get a lower rate of interest on the things that you borrow and other benefits. Your employer will look at your credit score. Credit score will say a lot about you. With a good credit score, you can get a better rate on your insurances. It is very important to have good credit as it will affect you greatly. Life is about making good and bad choices, and for every bad choice there are consequences that you won’t be happy with.

SETTING YOUR FINANCIAL GOALS

Everybody’s goals are different. I will write down my goals. You probably will not achieve all your goals, but you might reach many of them. You need to keep your goals in the forefront of your mind in order to know what you are trying to achieve. My goals were to be a teacher or a nurse. Next goal was to get married and have four children. I got married and had three children. Sometimes, you need to re-think your goals. Instead of becoming a teacher, I became a nurse.

My next goals were to buy a single house in the suburbs and to have two cars in the driveway. My husband and I did that. The next was to send my children to college. All of them went to college. Two graduated from college. The other one graduated from a vocational school.

Another goal was to pay off everything that we owed. Finally, as I managed the family money, I learned to invest and was on my way to being financially independent. My first investment was a safe and easy one, certificate of deposit. That was when the interest rates were high.

YOUR PLANS OR STRATEGIES

You have your goals. You need a plan, or strategies, to get you where you need to be. You need to get into action to make it happen.

Manage your resources well. Keep your focus on your goals.

Live a healthy lifestyle, eat healthy foods, exercise, and be disciplined. Live well below your means.

Don’t give in or out, be persistent in what you are doing. Be confident in yourself and be motivated. Overcome barriers, work to build a better life for yourself and your family, overcome adversity, and be determined.

CREATE A SAVING PLAN AND BUDGET

Open a saving and checking . Shop for a bank with free checking, and one that pays the highest interest rate. Make sure the bank that you choose is insured against loss by the Federal Deposit Insurance Corporation (FDIC). Some banks have free checking with minimum deposit. Make sure to keep your balance above the minimum to avoid bank fees.

Use your checks to pay bills and your credit card to make purchases. This way you can easily keep a record of your expenses and the money that you are spending. Always balance your checkbook to prevent overdraft and to keep your balance above the minimum.

For using your credit card, you need to be disciplined. Ask yourself, “Is this something that my family and I really need? Can I pay it off when the bill comes?” If the answer is no, delay the purchase or scratch the whole thing off. You can look for a sale. Be patient, some things don’t need to be purchased right away.

To be able to save to meet your goals, you will need to live below your means. Be disciplined and not wasteful. Make your purchases when you know you can pay for them within a short time. People buy a lot of things and never use them or may use them once. If you have things that are in good condition, you can give them to someone that need them or sell them.

Use a credit card with “cash back” for all of your necessities. Pay that amount

off each month to avoid interest charges. Also use cash-back bonus credit card to pay for food, gas, medicine, and shopping.

Set up an emergency fund enough for you and your family to live on for one year, or as close to it as you can get, in case you or your spouse, or both, lose your job or get sick. Also another emergency that might pop up is the breaking down of the refrigerator, stove, furnace, car, etc. Things can get stressful, but if you have a cushion, things won’t be so bad. When you are stressed, it is hard to make good and sound decisions. You need to have a budget. Know your income and expenses. Expenses should be much lower than income. This way you will have room to save. to be disciplined, stay focused, and save, save.

EMPOWER YOURSELF

Empower yourself by learning all you can about finances. Visit your local library and check out books on finance. Read books on different types of investment. Learn about mutual fund, load and no-load mutual funds.

Learn about certificate of deposit and other investment options. Some high schools have courses at night on finance. You can take advantage of different programs on TV and radio that will help educate you in money matters. You will be able to find good articles in newspapers and magazines about finances. You can get information from family, friends, and neighbors. You can find a lot of useful information on the internet.

Be confident in yourself and stay motivated. Set goals to become self-sufficient. God and you are in control of your destiny. One rule of thumb as to whether you should pay off a loan or save your money is that if you get a higher interest rate on your money than what you are paying on the loan, invest the money and pay your loan off on time.

Learn about ways that can save your money. Substitute things for something that will cost less. Learn to improvise and save, save, and save. Sometimes, a person will want something but don’t want the responsibility of doing what he/she needs to do to get it. They can empower themselves and do what it takes to accomplish their desire.

DEBT TRAP

Don’t get caught in the debt trap. What do I mean by that? Taking on too much debt at the same time and buying things you do not need to impress someone or just to look good. you are on a mission. Don’t be a high roller; buy things that you need at a reasonable price. Do not buy something that you desire, if it will be a problem paying for it. Don’t use checks that are sent to you through the mail from a credit card company or bank. Do not use cash advance that is at a very high rate of interest. Do not sign a contract unless you understand it. Don’t spend more than you can earn.

If you buy something on credit, always know what the interest rate is. Don’t fall for “buy now and pay later the same as cash.” It can be costly unless you pay the cost completely when due. If you are getting a loan, always know the interest rate. You can negotiate the rate.

Before making a purchase, know about what it will cost; do not make hasty purchases. If you think the price is too high, you can negotiate it, and it is no sin to walk away. Don’t get comfortable with more debt than you can handle. It can make you sick and cost you more money. In a situation like this, it can be stressful and lead to health problems like hypertension and ulcers.

BUYING A HOUSE AND A CAR

I think it is better to own a house instead of renting, but only when you are ready. To get ready for the purchase of a house, you should know how much you can afford to pay for a house. Buy something that you like, but buy something that you can afford. Only a certain percentage of your salary should go for housing, usually thirty percent. There are many other things that you will need money for.

You should have your emergency fund saved. If something comes up that you would need money for, you should be ok (loss of a job, sickness, and so forth). You should have a down payment of twenty percent of the cost of the house or more. You should have your bill paid off or down. , your mortgage will be your largest bill. You should look at that in light of other expenses.

If you have children or plan to have children, you should search for a location where there are good schools. If you are close to a shopping area, it will cut down on time and the cost of transportation. When shopping for a mortgage, of course, you want the lowest interest rate and always get a fixed rate that will last for the length of the mortgage. If you can pay your mortgage every two weeks or make extra payments, it will save you money.

Make sure you can do this. If you can, it will be beneficial to you. Get a mortgage for fifteen years, instead of a thirty-year mortgage. This will save you money. Another way to save on your mortgage is to pay it every two weeks if possible.

When buying a car, it is best to buy a new one if you can afford it. If not, look

for a used one that has a warranty. Buy one that you can pay off quickly. Credit is costly. Any debt that you have, you need to pay down and off very quickly. If you don’t know much about a car, you should take a family member, friend, or a mechanic to help you pick out a good one. Buy one within your budget.

THE NECESSITIES OF LIFE

Increase what you have to reach your goals. Maximize your moment. It’s about time. We all have needs or necessities of life, to live and be comfortable from the time we are born until the time we die. An example would be food, shelter, and clothes. Someone provides these things for us, until we are able to provide them for ourselves. Usually it is your parents or parent, grandparents, or grandparent. It could be foster parents or a foster parent, guardian, or other relatives. We know we need to provide the necessities from adulthood until death. If we have a family, we need to provide for them also. The first step is to recognize and have a goal to become successful and financially independent.

Unless you have a very, very high paying job, you will not be able to become financially independent. The saying is that the more education you have, college degree or higher degrees, the more money you make. That is not always true. You may not be able to find a job in your field or there may be other reasons. There is another saying that the more money you make, the more you spend. That is true sometimes.

You get a job, making an average salary, not low and not a very, very high paying job. , I said that you would not become financially independent unless you had a very, very high paying job. After acquiring your education and getting a job, you need to get out of debt. That is a big problem for some people. The key is discipline and determination. Stick to your budget; keep your goals and plans in the forefront of your mind.

Go over your budget and cross off everything that you can do without. Only treat your family and yourself on special occasions. Please do not overspend. Buy the food in season, when possible. When it comes to lawn furniture and things you use in the summer, buy those in the winter, such as a lawn mower. Your budget

should free up money to pay off debts. Start with the credit cards as they have the highest interest rate. My dad taught me a lot about finance. He only had a fourth—or fifth-grade education, but he was good when it comes to finance.

With his teachings, we saved thousands of dollars on our mortgage. He taught me to excel my payments on the mortgage. We never held a mortgage longer than eight years. We were able to sell that one for a profit; now we are positioned to get a better house, according to our liking. As in building a house, you need to have a solid foundation even for finances to build on it. You can’t do that unless you are in the right position. You need to have a goal, be disciplined and determined. Stick to your budget by paying off the debts and not buying things that you don’t need or things you can do without.

Once your smaller debts are paid, then you can bounce on the mortgage and pay it off. My dad saved out of necessity. When you don’t have much and you have responsibly and goals, it will make you look at ways to get to your goals, if you are committed. You see things depending on the position you are in. My dad’s goals were to do the best he could for his family. You will lose a little sleep, but ideas will come your way. As you read, you will get different ideas. You can also get ideas from TV, radio, magazines, internet, and newspapers. By talking to people, you will not only pick up good ideas, but also see if something is profitable or not. Something could be said that would motivate you or keep you from doing the wrong thing.

My parents had ten children; however, they raised nine as one died as an infant. So out of need and responsible, my dad was disciplined in saving. He did the best with the little money that he had and put it to good use.

In the present generation, a lot of them have not learned to save. Some don’t want to, and some don’t see the need to save. Their parents have given them a lot, and they lean on their parents knowing that if they needed something, they have dad and mom or others to help them. Some people depend on others when

they get in a bind. The truth of the matter is most of the people need their own money.

A lot of people don’t want to wait for tomorrow, but spend and enjoy things today, especially things that take us years before we could enjoy, for example, taking a vacation in another country. Some people like to do what they want to, when they want to, whether they can afford it or not. That is how they find themselves in a bind financially. Some will say tomorrow is not promised to me, I am going to enjoy what I have now. I am not leaving any money for anyone. What if you survive every one and all funds are gone?

WAYS TO SAVE

Be a bargain hunter; take the time and patience to save. Check the paper at different times of the year; certain things will go on sale. Try not to buy a lawn mower or an air conditioner during summer. Buy things normally used in a season before the season begins or after it changes.

Do your Christmas shopping after Christmas. A lot of things will go on sale. You can shop for Christmas throughout the year, when things are on sale. Things that you need in the winter, buy them in the summer and vice versa. If you have children, buy their clothes when they are on sale; if it is a good sale, buy sizes that they can grow into.

When you are shopping for grocery, buy your meats when they are on sale and stock up, so you will not need to buy meat for a while. At certain supermarkets, at different time of the year, they will have chicken, beef, and fish at a reduced price. Take advantage of these. Buy food that is in season, a lot of which you can freeze and use later. Only buy linen when they are on sale. Stores have white sales, or when a new store opens, you can get bargains. Try not to use convenient stores as their prices are much higher.

Save money by making your lunch and coffee. Learn how to do house repairs and painting. If you have boys, learn how to cut their hair. Learn how to do your hair and your girl’s hair. Hopefully, someone in the family can take care of the lawn, clear your leaves. To lease a car is not a good move. It’s like renting a house and not buying it. You continue to pay and never have ownership. Buy a new car that gives good mileage and that you can pay off quickly; and drive it for at least ten years. Do not buy two cars, if one will do.

When selecting a college for your children, it is cheaper to pick one inside your state. You will be saving on tuition, phone calls, and travel. College books are quite expensive; your child can buy books from other students that have finished the course.

Don’t overheat your house in the winter; wear heavier clothes with a sweater and turn down your heater. At bedtime, turn your heater way down and sleep under a blanket or blankets, a great savings in your heating bill. Seal places that heat escape from. If you need insulation or insulated windows, it would be worth your while for you to get that done. Carpet and rugs will make your house warmer in the winter. In summer, don’t keep your house too cold. Keep it at a comfortable temperature and wear light clothes.

I know some people do not like to eat leftovers, but when you cook make enough for three days. Eat leftover for one day and freeze the other. This way you are not using your stove every day. With the microwave, it is so easy to warm up a meal. When I was growing up, I heard my mother talk about stretching things and making do. Now the saying is it’s good enough. You don’t need to spend more, when you can get it cheaper.

To save on books and magazines, take advantage of your local library. If there is a course you are interested in, some of the high schools have adult classes for a reasonable fee.

If you have a yard, you can plant a vegetable garden in the spring. Tomatoes, green peppers, squash, and cucumbers are very easy to grow. They make a nice salad. Another thing to take advantage of is thrift stores. When you find a bargain on food etc., stock up things that will not spoil over time.

A large freezer is not needed unless you live on a farm or have a large family.

Why pay for the electricity to run it, if you don’t need it. If you have a freezer, with not much food in it, you can stock the food in your refrigerator and turn the freezer off, until you go shopping for more food.

Take advantage of any retirement program you may have on your job, like matching, the company will match what you save and others, the insurances program, investments, etc. They also have benefits for your family.

Learn the art of shopping to save money. Only buy when things are on sale. Don’t buy for the brand as you will be paying only for the name. Take notice on how things are packaged, you are paying for the packaging.

Share tasks such as babysitting with family, friends, and neighbors; also car pool. For things that need to be done to the house such as roofing, plumbing, electric work, wall papering, painting, flooring, lawn work, etc., see if you can exchange tasks with neighbors, family, or friends. Get a part-time job, in addition to your regular job, especially when the kids are out of high school and away at college. Save on auto insurance by increasing your deductible, and lower your medical bills, if you have medical insurance. Also if you have your home owner insurance, car insurance, or any other with the same insurance company, they will give you a discount for having multiple things. Save on your prescriptions by switching to generic drugs. Be creative about ways to save.

BUDGET TO SAVE, SAVE TO INVEST, INVEST FOR INCOME

Pay your debts down because as you pay them off, there will be others that will take their place. You never know when you will need a washer or dryer, car, lawn mower. You will need money for the children school things, college, clothes, vacation, house and computer upgrade and the list go on and on.

As you pay off your debts, pay off the credit card with the highest interest. Continue until the credit cards are paid off. Do not have more than two or three credit cards. One should be the kind that pays you back; after so many purchases, you will get cash back. With discipline, you can use one to buy the basic necessities of life (food, gas for the car, etc.). Pay the bill when it comes in; do not spend more than what you can pay when the bill comes in. After you have paid off your credit cards, pay off other bills that you have, may be a car loan, mortgage, etc. Tackle one at a time until you are out of debt.

You budget to save, use the saving to pay off your bills. Now that your bills are paid, you continue to budget to save. You can use that money to invest. You are on your way to financial independence. You have laid a good foundation financially.

After taking care of some of the necessities of life, you have come far enough. You can enjoy and be able to do some of the things that you couldn’t afford before. You may want to take a vacation, attend different activities, belong to different organizations, eat out more often, etc. Graph what you want to do as long as you can afford it. To become financially independent, you need a good foundation financially. Next you need to start investing your money for income. With the income that comes in, you can invest more.

LEARN HOW TO INVEST

If you don’t know anything about investing or you need to know more, start to learn. You should learn about safe investments. All investments have some risk, but there are safe investments.

One safe investment is a CD (certificate of deposit), one that is insured by the FDIC (Federal Deposit Insurance Corporation) and the FSLIC (Federal Saving and Loan Insurance Corporation). They insure up to $100,000 per . They offer more at different periods, you need to check that with the place that you are doing business.

Certificate of deposit is safe and easy to understand. You deposit a specific amount for a specific time at a certain interest rate. When the interest rate is up you can make quite a lot of money, depending on how much you are investing. When the interest rate is low, you will be making less money. If you have several certificates of deposit, schedule them to have interest payments at different times, so you have a continual flow of money coming in.

Saving s are safe, but they should also be insured by the FDIC, and the FSLIC pays very low interest rate. I wouldn’t call them an investment, although you can make some money, but not much. Money markets pay a higher interest, but check to see if they are insured against loss. There are many investments; some investments carry more risk than others. Other investments are corporate bonds, municipal bonds, treasury bonds, treasury bills, treasury notes, mutual funds, etc. You can take a course or courses in different kinds of investments. Gather information from the library, internet, magazines, newspapers, and radio.

After learning about some of these investment options, you may want to learn how to trade stocks. You would need to take courses in that. You can get a brokers online. Just , all investments carry some risk. Some have more risk than others. Never invest in something that you don’t understand. Always know what your risk is. Know what you are buying and how is it going to make you money. If you don’t know that, don’t get into it. You are almost there. To be financial independent, is your goal.

HELP YOURSELF

Sometime only you can do for yourself what needs to be done. Only you know what needs to be done. Encourage yourself, empower yourself. Be an advocate for saving and discipline yourself. You can pull yourself up by your bootstraps. For the ones that have goals and want to achieve something, don’t put things off, be motivated, don’t be lazy or wasteful, don’t give up, be persistent, and continue until you reach your goals. Have perseverance as a good soldier.

If you don’t discipline yourself, you will come up short. If you are not determined, you will come up short. If you are not persistence, you will come up short. Only you can do these things. You need to have confidence in yourself. Even if nobody else has confidence in you, you have confidence in yourself.

In order to feel good and have plenty of energy, you need to get six to eight hours of sleep or more. Eat a balance diet. Eat lots of fruits and vegetables. Drink plenty of water, six to eight glasses or more. Exercise at least three times a week for forty minutes. Walking is one of the best exercises.

Don’t put off until tomorrow the things that you can do today. Be determined. Have your mind made up to reach your goals in spite of the storms. You are the deciding factor. You have the ball in your court.

But seek ye first the kingdom of God, and his righteousness; and all these thing shall be added unto you. Do this and you will be successful, spiritually, physically, and financially.

, the rich rule over the poor and the borrower is servant to the lender. And also beloved, I wish above all things that thou may prosper and be in health, even as thy soul prospereth. Owe no man anything, but to love one another; for he that loveth another hath fulfilled the law.

Finally, brethren, whatsoever things are true, whatsoever things are honest, whatsoever things are just, whatsoever things are pure, whatsoever thing are lovely, whatsoever things are of a good report, if there be any virtue, and if there be any praise, think on these things.

But thou shall the Lord thy God: For it is he that giveth thee power to get wealth that he may establish his covenant, which he swear unto thy fathers, as it is this day.

As it is written, I have made thee a father of many nations, before him whom he believed, even God, who quickened the dead, and calleth those things which be not as though they were.

Then he said unto them: go your way, eat the fat, and drink the sweet, and send portions unto them for whom nothing is prepared; for this day is holy unto our Lord; neither be ye sorry; for the Joy of the Lord is your strength.

There hath no temptation taken you but such as is common to man; but God is faithful, who will not suffer you to be tempted above that ye are able; but will with the temptation also make a way to escape, that ye may be able to bear it.

Pay yourself first. You will be motivated to pay your other bills. If you run short, you can pick up a part-time job. By paying yourself first and running short will

make you find other ways to earn extra income to pay your bills. Learn to stretch your resources. Be a good steward of what you have and spend your money wisely.

There is treasure to be desired and oil in the dwelling of the wise; but a foolish man spendeth it up.

Learn how to stretch your resources. That alone will take you a long way. Learn how to become wealthy and not just rich. , do not buy anything that you cannot afford, it will cause you trouble down the road.

ABOUT THE AUTHOR

Pearl Iseabell Poole Roberts is a born again Christian. I am a widow. I was married for thirty-eight and a half years. I am the mother of three children. My oldest son Walter Leon Roberts is deceased. My second son is Brian Keith Roberts. I have a daughter, Paula Lynette Brown, a son-in-law, Otis Tito Brown and two grandsons, Otis Tyree Brown and Omarie Thomas Brown.

I am a retired licensed practical nurse. I worked as a nurse for forty-five years. I worked for one of the largest hospital in Philadelphia, PA and for several nursing agencies. When you retire, you should retire from something to something. So your life will be full. The things that I didn’t have time to do when I was working, now I can do them.

I like spending time with family and friends. I am active in my church and other ministries outside of my church. I like to read, watch movies, travel, and play games. I enjoy listening to gospel music and bowling, just to name a few.