Wednesday, April 26, 2006

College experience -> over.

Wow. College is over. One week to go and I'm off to the real world. Here are my thoughts on the whole "college experience" and if it was actually worth it.

Major advantages:
  • A future $1 million dollars. Having a college degree will increase your income 60% over high school graduates which translates to around $1 million more over the course of your life (from increased income and time value of money).
  • Key to getting a good job. College education puts you in a more diverse pool of jobs and if you don't prefer manual labor, you are likely to get a job that doesn't require it.
  • Earning power. Moving up in a company comes easier with a degree. The financial benefits alone will entice many people to accept.
  • Job movement. It is much easier to find other jobs if you dislike your current one. The pool of jobs is better for college grads than for high school grads.
  • Networking. One of my favorite benefits. I have met so many people here and the experience alone was worth the cost. I have had a great time and people that I have met here will be great networking opportunities in the future.
  • Fun. College is awesome. You stay up late because your class doesn't start until 12:00pm the next day. You go out and have fun with friends on almost any night of the week. Responsibilities are low unless you have a paper or exam that week. I had the time of my life here, which is why I don't want to leave.
Major disadvantages:
  • Expensive. I spent close to $40,000 on my undergrad education. Factoring in that I could have saved that $40,000 and been working full time, it's a lot more expensive then it seems. That is just tuition expenses and doesn't include room and board.
  • Stress. Exams and homework were not usually all that fun but they weren't the end of the world either. I never got too stressed out and it wasn't really all that bad but sometimes it is enough to push some people to give up.
What's next for me?
  • Learning never stops. I will never stop learning. It is really what makes me tick. If I am not learning something, I am usually bored. I will learn through a job, reading, talking to people and any other experiences I will have.
  • MBA Degree. After a few years of working, I will be going back to school for my MBA (Master's of Business Administration). I am really set on doing it and I think it will definitely happen in the future. Average salaries for MBA graduates is $88,087 starting out and $167,052 after 5 years as listed on Fortune. My industry focus is going to be Venture Capital (starting: $103k, in 5 years: $233k), Investment Banking ($95k, 239k), Management consulting ($97k, 195k). I feel that I would enjoy any of these fields and if I push myself hard enough I will be there someday.

Monday, April 24, 2006

Becoming a Millionaire

Becoming a Millionaire
It's not really all that difficult to become wealthy. Wealth means different things to everyone, but I feel it is simply 'a comfortable financial state'. Maybe you don't want to be a millionaire but most people do, just simply because of the status that many people see attached to it.

Here are my three steps to become wealthy:
  • Spend less than you earn. Not a hard concept. As many people receive raises at their job or encounter new income - they also increase their spending. "I got a raise at work so I should treat myself to a new car." This is not a good way to get ahead, always spend less than you earn.
  • Invest. There are millions of ways to invest but the important part is to put your money somewhere that you think will earn a return. Make sure you diversify your investments so if one drastically drops - you won't lose the farm. Examples of investments are the stock market, commodities (oil, precious metals, etc), real estate, a business, precious coins, stamps, art work or antiques. Pick something you enjoy or think you would be good at.
  • Keep adding to you investments. Keep adding to your investments over the years. If you are unaware of the term 'compounding interest' - do some research on it. It has a profound effect that I believe many people either don't know about or don't pay much attention to. This is the key to making many people wealthy. The earlier you start investing, the better the effect of compounding interest.

Friday, April 21, 2006

Dale Carnegie Course

The Dale Carnegie Courses are supposed to be very beneficial. I would probably do the public speaking course first. I am not that bad at public speaking but I could be better. Public speaking is consistently one of the largest fears of people and rivals spiders, heights, snakes and terrorism.

Wednesday, April 19, 2006

Breaking Out of Your Shell

What shell?
  • The shell you have become so accustomed to in your life. The shell that makes life simple and routine.
People and "daily routines"
  • Maybe you like where you are in life... I'm not saying "change everything". It feels good when you do something different for a change. Most people are just sucked into their normal routine and life gets boring. They wake up at 'x' time, go to work, come home, eat dinner, maybe do a few things around the house, watch tv and go to bed EVERY SINGLE DAY!
Break the shell
  • Always wanted to cliff jump? Go do it! If you don't like it then at least you will have a story to tell. Instead of watching tv after you get home, go out and have fun. Play a sport or learn something new, you typically won't regret it. The least you can gain is knowing that you don't want to do that ever again... and that's not a bad thing.

Monday, April 17, 2006

Free learning from MIT

This is incredible. MIT provides classes that are featured online - FOR FREE. It's pretty awesome that a great college like MIT is striving to educate the public for free.

Check it out:

Advice from Mr. Buffett

I would like to first start off by saying that my trip to meet Warren Buffett was amazing. He is a down to earth, hilarious guy that seems like any other person (except that he has $40B under his belt). He is very intelligent and seems like he has the ability to memorize exact quantities and dates. He's just a really interesting guy that loves to tell jokes.

Great Advice:

"Change is not an investor's friend".
Look at businesses that are simple. Determine what the businesses will be in 10-20 years. He does not particulairly like technology companies because they change way to fast and are unpredictable in that time horizon.

"Swing hard and swing at the right price". Wait for the perfect price to buy. Determine the value of the company and only swing at that "perfect pitch". You may have a few pitches that you could swing at but the perfect pitch will be the best to hit out of the park.

Hold companies that you have confidence in. If someone offers you 2x what a company is worth, don't take it. You should have so much confidence in the company you are investing in that the future will be better than what someone will offer you now.

Tips for buying a business (stock). Buying a stock is like buying a business. You should have the mentality that you are purchasing the entire business, even though you may only be purchasing a few shares.
  • Find out if the manager loves the business or loves the money. If he/she loves the money then this should be a warning to you. If they love the business, chances are they are there for their enjoyment - not to get a pay raise.
  • The business should also have the right leader (CEO). He/she should be appropriate for that business and paid in an appropriate way.
  • Good leaders should also have the ability "to inspire others". These are the leaders that make great businesses.
Key things a person should gain in business:
  • Communication (oral and written) skills. Warren commented about a Dale Carnegie course that he had taken which had one of the greatest impacts on his life.
  • Accounting knowledge. "It is the language of business". If you do not understand accounting then you are at a huge disadvantage in the business world. It is essential to your success.
  • Getting people to work for you. Many different characteristics go into this one but getting people motivated and to work for you is absolutely essential to being a leader and being successful.

Wednesday, April 12, 2006

Essential People in Your Life

How many essential people do you have or need in your life? Here's a list of what I think I need or have:

Headhunter
Career Coach
Computer Tech
Realtor
Electrician
Plumber
HVAC
Appraiser
Lawyer
Financial Advisor
Accountant
Medical Doctor
Venture Capitalist(s)
Auto Mechanic
The Cheapskate
Best Friend
Entrepreneur
Fitness / Workout Buddies

I was surprised on how many connections with different types of people and skills that I actually have. Some of the jobs I am able to do sufficiently by myself but I need to continually build my network so that I have people there if I ever need help. Most of my friends are filling the essentials right now. The other positions I haven't had a need for in the past but expect to in the future.

Monday, April 10, 2006

Personal MBA

I just came across an awesome blog called Personal MBA. It was written by Josh Kaufman and it gives many recommendations for reading materials in order to succeed in the business world.

I have personally read a few of these and would highly recommend them also:
7 Habits of Highly Effective People by Steven Covey
How to Win Friends and Influence People by Dale Carnegie

Many of them that are listed are on my 'to read' list or will be shortly.

Friday, April 07, 2006

ETF Portfolio Done... for now

I finished my portfolio objectives for now (see objectives). I am well-diversified country wide as well as market capitalization. I took a riskier route than most but I am young so I can afford to do so.

Holdings:
Emerging Markets Index (VWO) - This ETF tries to mimic the performance of a custom version of an MSCI emerging-markets Index.
Mid-Cap Index (MDY) - This ETF tracks the S&P Midcap 400 Index.
Small-Cap Index (IJR) - This ETF tracks the S&P SmallCap 600 Index.
Pacific Index (VPL) - This ETF tracks the MSCI Pacific Index, which includes Japan, Australia, Hong Kong, Singapore and New Zealand.

* This is a very risky profile but as they say, with risk -> comes return!

Buying or Selling a Business

Excellent guides for buying a business and selling a business by Anthony Cerminaro.

Monday, April 03, 2006

Leading without Power

It's tough to walk in a job and lead people. There are a lot of things you have to establish before people will follow you.

Managing without Authority
Trust & Respect. You need to gain this from others in your team or company. Make positive impressions on others by keeping your lines of communication open, give your views and let the group critique them and do things for others. Help others out when they need it and make sure you get them done on time. These will all start building on how well people trust and respect you.

Individual Interests. Everyone has motives for what they do and everyone is interested in slightly different things. Keep communication open and let people let their ideas out. The team can decide together on what the best ideas are. Keep your ego on the backburner, most people aren't impressed by this.

Show Your Interest. Stand up and take blame when needed and maybe even take the blame for another team member if you were partly at fault. Don't be self-centered, everyone makes mistakes so fess up.

Lead by Example. Don't say one thing and then do another. Lead with your values and stick to them. If someone does something good, commend them for it and make sure others recognize.