Be Aware of Tax-Related Scams

Ok now that you’ve recovered from falling off your chair after reading the tile of this blog, let me explain.

Inflation is one of the biggest challenges in achieving, and maintaining, financial independence. The low inflation we have experienced for decades has made many of us lazy when it comes to spending.  Now is the time to put some great habits into place that will reduce your spending now and will help even more when inflation get’s back to historical norms.

Here are some tips:

1.  The days of clipping coupons seems to be a thing of the past.  Time to resurrect this time-tested way to save money.  Now it’s done electronically.  Click here for a great article on coupon apps.
2. Bargain shop.  The meat department is the best place to shop for deals.  Supermarkets would rather greatly reduce the price on meat than throw it away.  I’ve seen bargains at 50% off.  And not to worry, the meat is still good.
3. Dump the name brands.  I am a big name-brand guy however that is changing.  You can save 30-50% on certain items by going with the store brand such as Kroger at Ralphs.  Just today we saved 30% on peanut butter and couldn’t tell the difference.
4. Use those credit card miles.  If you fly Southwest use their Chase Rewards Card.  This year alone I flew two of us to Hawaii roundtrip and flew myself to NY and used my miles.  Pretty much all carriers have credit cards they use for miles.
5. If you shop at Ralphs use their Ralph’s Reward Card.  They have a great app that shows you year to date savings.  We have saved $500 so far this year.  You also get fuel points that you can used at Shell Stations.  I’ve saved as much as $.50 per gallon!
6. This one is real hard for me but try to walk out of restaurants with a doggie bag.  I’m the type of person that if something is real good, I’ll clean my plate (thanks mom!).  But with portion sizes so big you should have no problem making two meals out of one.  Your wallet and belly with thank you!

These are just a few habits to help get you through this time of high inflation that could help your plan when inflation gets back to “normal”.

As someone who works directly with clients on helping them with their financial plans and investment decisions, it wouldn’t be too far off to think that I might not do too bad on my own personal investments. Well, truth be told, I have indeed made some high-return investments over the years. The funny thing about that is when I think about “the best investments I ever made”, they are not stocks, bonds, mutual funds, real estate, venture funds, or the like. The best investments that I have ever made came from investing in myself and/or my practice. The returns may be harder to quantify, but I would venture to guess that it has been exponential. Below are my top three “best investments I ever made”:

Going Back To School For An MBA

I’ve always been someone who wants to constantly improve, both as a person and as a professional. In an article that I had previously written, I discuss how an MBA prepared me for my career as a financial advisor. This was a both a huge gamble and a big-time winning investment for me, especially since I initially entered business school without a clear roadmap of where the advanced degree would take me. After going through the MBA program at USC’s Marshall School of Business, the greatest value I gained came from improving my qualitative skills, such as working with people, networking, effective communication, work ethic, and time management. While I already had these skills at a basic level, it wasn’t until after obtaining my MBA that I realized a deeper level of utilizing those qualitative skills in my career.

Hiring A Personal Trainer

Without our health, we will not be able to enjoy all of the great opportunities at our disposal today or in the future. Because of this fact, I strongly believe that hiring a personal trainer was one of my best investments. In this article, I draw several parallels between personal trainers and financial advisors, ultimately discussing the value that both can bring, respectively, to your health and finances.

Investing in my health by hiring a personal trainer is one of my best investments for several reasons:

Education

For most, it may not make sense to have a personal trainer for their entire life. However, the knowledge and education around the body, nutrition, exercises, etc. that you will gain from hiring a personal trainer will reap returns for the rest of your life. By being more aware and knowledgeable than you were before, you may miss out on potential future injuries or poor food choices that can lead to debilitating diseases.

Consistency

We are more likely to stick to certain regimens when we are simply told what to do. By being on a plan and schedule with my personal trainer, I did not have to worry about anything except for showing up and working hard. We were on a consistent regimen, and I saw results; in fact, I lost more than 15 pounds over the course of several months when I compared my heaviest to my lightest weight!

Decreased Future Medical Costs

By being consistently active and doing exercises that I would not normally do on my own, my personal trainer made sure that my comprehensive training program would benefit me in the realm of longevity. Because of that, I decrease my chances of needing to undergo major surgeries that someone who lives a sedentary life may have to undergo. This means less money spent on future medical needs and long-term care.

Spending Time To Imagine And Dream About The Future

Sometimes work, family, and social events take up all of our time. However, if we never stop and take time to plan, strategize, and dream, we will never accomplish our goals, let alone have something to work towards. While it may not seem like an investment, “spending time to imagine and dream about the future” may be the lowest-cost, highest-yielding investment there is.

In this article, I talk about planning ahead and setting financial goals. It is important to be proactive in planning for the future that you want. The key here is to write your goals down, break them into smaller goals, and find someone (or a community) that will hold you accountable. Your success lies heavily in setting “meaningful” goals. When you set goals that are meaningful, you will be much more likely to reach them.

For me personally, I’ve found that in those times that I dedicate to imagining and dreaming about the future, I’m able to create a reinvigorated excitement for what’s ahead. The return from spending time planning for your future should not be discounted. The yield is immeasurable, and all it costs is your time, creativity, and dedication.

The investments discussed above are not what you’d typically discuss with your financial advisor. However, I hope you were able to see how much of a return each of those items have provided me. With that said, if you are contemplating post-secondary education, different ways to invest in your health, how to map out your future goals, or anything else, please do not hesitate to get in touch. You can always call my office at (949) 221-8105 x 2128, or email me at michael.loo@lpl.com.