Just read The Intelligent Investor written by Benjamin Graham

hurdles

Wow! After spending the first 15 minutes with the book, it just felt great! It felt like someone is finally talking to me about the things that really interest me. Like having meat someone in a foreign country that finally speaks your language.

Not that I am such a great mind like Benjamin Graham, you can also look on this as if a child is listening to grandpa’s most exciting stories.
I love statistics, figures, numbers and investing. I think I’ve just swallowed the red pill from Matrix and I arrived to the land of value investing and cannot ever return to the stupidity that surrounds us everywhere.
I own stocks. Roughly 90% of my money is in a single growth stock, the remaining is in a stock of a company that I believe would fit Mr. Graham’s criteria. Still, the market’s are falling as of today (24.08.2015), but at the age of 31, I am happy. I am happy, because I want to experience the selloff, I want to see that I can buy stocks at bargain prices. I am learning and becoming a better investor. No one can stop me! (Perhaps except my future mother in-law 😀 – just kidding)
After heaving read the entire book, I know that my portfolio will need quite a change. I’m on track reaching my goals and I just shifted to a higher gear.
Life is great because of this single book that is not promising anything, but giving meaning to the financial ups and downs of Mr. Market.

The power of family

Family
I previously wrote an article on how we don’t have to be alone and how we can rely on our money to help us along the way of our financial life.
Now I’d like to highlight the power of family – later on I will write on the dangers as well.
My family consists of 3, my Mom and my brother (my Dad passed away when I was 3).
We love each other, also there’s a very high level of trust.
This is something very valuable which is undervalued in many families.
When you ruin family relationships, you are ruining your business opportunities too.
We can be in 3 different places, representing the same interest – that’s powerful!
We can lend one another with 0% interest rates with no risk!
We can share our financial experience and knowledge, combine the knowledge of various subjects and prosper further.
The reason why this topic came to my mind is because we recently bought an apartment to give for renting for tourists coming to Budapest.
My brother and I didn’t have money to buy such. My mom did.
My mother is getting old and it is very hard for her to move around downtown. I have moved downtown a year ago and speak English (hope you can support me on this fact 🙂 ).
I am not much of a technical guy, wouldn’t know how to fix stuff around a house. My brother is superb in solving such issues.
Here you go. I think this is a perfect example, when 3 people can increase the size of the cake and by doing so get a much larger portion of cake, then if they would do things on their own.
The power of family. (If you are interested, we decided to split the profit 50% my Mom -25%-25%).
We are however different. My mom is ultra conservative on finances. My brother burned himself once by starting a company and took him 5 years to end that nightmare – starting a business is very hard here. Now he spends much money on his car, which he loves. I’m into NYSE now and wish to educate myself.
An additional asset my family has is real-estate. I won’t go into details but the point is that we have excess that we don’t use now. Once the apartment is making money and we have proven that we can handle it, then we would consider to invest further into this business, by selling and buying new properties that fit the purpose.
We are able to do so because of the excess real-estate we have. Why and how do we have such?
Because of family.
My family has an unwritten advice/rule. Always add to what you inherit, never loose from that. It’s not yours, but your children’s, even if they are unborn. You can be free to invest with what you make, but stay very cautious and conservative when handling assets and wealth what you inherited.
So I truly feel blessed coming from such a family and I hope and wish that I will be able to pass on the wealth and knowledge.

What is money? Not the FIAT-gold discussion, but the essence of money.

morpheus

So we all know the story behind the birth of money, how the ancient people decided to have a common exchangeable value item, taking the place of the barter system.

I think today’s everyday people don’t keep in mind the fact what money is.
In my opinion, it is perhaps the best invention of mankind!
Money holds work, sometimes hard-sweat work.
People get paid for their work. Which is not only their energy, but also their time. We know everyone only has limited time in their life. Some say you can’t buy time. In the end they will be right, however, to a certain extent, you can buy time.
You can pay for someone to do something that you were supposed to do, but you decide to do something else. You can pay your friend to take your wife to the airport, because you want to rather watch a game. Ever seen a billionaire standing in line and waiting? Possibly, but a rare case 🙂
In Hungary we get paid less for sometimes the same work as our fellow Western-Europeans or my American friends. Our energy and time is valued less. I got over this, no big deal.
(Expenses are indeed cheaper, but in the end these circumstances end up providing a lower living standard as the price of many things are the same as everywhere in the world, the price a Mercedes will be the same (or higher due to taxes)).
So I ask myself, would I want to pay $5 dollars for a Starbucks coffee (I work roughly for net $46/day), for which I work almost an hour? No waaaay! Oh and by the way I did not even include that I am ‘only’ able to save 50% of my monthly net salary. – I know this % is great! This is my only reason for financial hope by the way.
I love cars, the above analogy would translate to this question, now including savings: A car I would love to buy, costs around $49.000 – brand new. Would I work and save only(!) for this car, for 8 straight long years? Hell no!
I think too few people ask themselves when buying stuff, how much they work for such. Bringing this thought further, how much time and their energy that item or service is truly worth. Some might think I am Ebeneezer Scrooge, but I’m not. I’m living below my means.
I think it is important not to spoil. The biggest mistake can be to spoil ourselves. As it is ‘me, me, me!’. Then we can spoil our family and friends. By doing so, we would set furthermore a very bad example, and dig even deeper in expectations and sourness (people tend to expect always more and in the end we can’t provide it). Buying unnecessary stuff is valuing yourself low.
My girlfriend expects me to buy an apartment, later a family house (honestly, she thinks ‘we’ would buy these, but as she can’t save with her current salary, the equation is with me alone).
We do have a small 60m2 house which my family gives out to rent. But my girlfriend wouldn’t want to move there as my mom would be too close. But I’m not sure if she understands that I would need to work for 8 long years just because she doesn’t like my mom being close. (Otherwise she loves my mom, at least I think so 🙂 )
cube
I want to have more money. We all do. Some more, some less. Some want other things. There are many other things we can buy with money, so in the end I think people don’t want money bad enough, because they don’t understand well what it actually is. When it is a top priority to become rich, I say it’s a good thing as it could also make you value your time and energy. By doing so – by getting rich – you can increase the value of your time and energy.

Which opinion to listen to? All. Where to find quality advice? Anywhere – everywhere.

As I am trying to evolve my financial life, selecting the right vehicles and making the right calls at the right time, I find myself continuously in the middle of a battlefield of different opinions.
These opinions often collide.: Warren Buffet-like investing thinking of selecting stocks for the long run, not to bet on timing, but on value.
Then the criticism comes of not focusing enough and therefore missing out on the ups of the market. I think I’ve heard just as many people tell me to differentiate as those who said to focus my investments if I want true success and return.
The list of debates goes on and never ending: savers are losers, but when the nightmare turns true, then they are the survivors…
I have a great skill, which I cherish and love about myself: I can listen. This doesn’t mean that I will do everything according to the advice or opinion I just received, but will try to make an effort and understand that point of view.
This is why I know and would like to share my opinion to listen to all. I know how much stupidity and non-sense around us is, but we need to filter. This is a skill. And just as you train you muscles or anything else to get better, you can also get better in filtering.
When you want to get a Harley, you’ll start to see them more often in traffic and around you. Why? Because you want one. Once you have seen one, you think of it longer than the other car or bike that went before or after that Harley you’ve just seen. If you focus and want to get quality information, anything that you can use for your goals, then you’ll find it.
Once I’ve seen a stupid, low quality Chinese fighting movie (with friends and got drunk). In the middle of the movie they said something on how water can destroy the strongest rock there is, it only takes time. I was drunk and having fun with my friends, but then I realized how that fits into my picture of hard working paying off. How the water could become more efficient in destroying a rock? Perhaps if the water drops would be improved to a water cutting machine? So if I focus on trying to become successful on the stock market, then I should take my time, but effectively study stock market related material.
My mind is simply set to this mode. Trying to find / make useful information to achieve my goals.
So I try to focus on sources that have the highest chance to help me achieve my goals, but as my goal is set, I never turn off my filter and always try to keep the shiny gold idea, filtered from the junk.

Time and efficiency – I mean a different sort of efficiency than what you think

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I don’t think there’s not a single soul out there who hasn’t heard of the importance, on how we should squeeze everything we can from our time. Be efficient!

Set your mouse scroll faster – it will take time for you to adjust, but will win time on the long run.
Prioritize your tasks
Learn how to typewrite
Check out recipes that only take less than 20 minutes
and the list goes on and on…
Most of us wake up in the morning, think about what we must do. It’s usually going to work. It’s the same case for me, I have a full time job and work from 8:30 AM till 5:00 PM. Then I try to make myself go jogging for an hour. I’ll get home tired. My girlfriend will arrive and we’ll chat, watch a movie, play on a game console, perhaps read a book and have dinner (of course there’s more than that).
The point I’m trying to make is that we all have a daily routine. As a matter of fact, at the age of 30, I think my daily routine hasn’t changed much since I started working, roughly 6-7 years ago.
So I want you to zoom out from thinking how to be efficient, from the mouse scroll speed level to your life level.
I asked myself, am I efficient with my life?
I know how this question could fill books with content and I don’t want to discuss family, children and things like that. My blogging aims on personal finance and getting rich.
So I rephrased my question: by having no other option than having a full time job (I’ll discuss this in a later post), am I being efficient in making money?
I started reading many rich man advice ideas and I got a clear answer to my question: no.
I need to read, learn, debate and ask others on this matter – so please comment and debate my ideas, because we’ll get better in the end.
Our daily routine tasks are wrong, the prioritization is wrong. To learn new things, listen to new ideas and get different glasses to see the world through different shades is important. Then I will have a chance to see and think different. Because the rat-race lifestyle is not leading anywhere.
So I started reading, I started writing this blog. I watch interviews with rich people. Shark tank, Dragon’s Den (Canada, UK) I keep watching and other CNBC shows too.
I feel that I am improving and I value this feeling very important. I want to develop my skills further and gain information on anything that can prove useful in my goals.
So what truly matters is that I know my destination and each step towards that will help me get there. Please join me in my journey and if you can help with your ideas.