Financial Samurai

According to Harris Interactive,  the most popular male athlete in America is Tiger Woods, and the most popular female athlete is Serena Williams.  This got me thinking…. hmmmm, America is absolutely obsessed with football, baseball, and basketball and yet golf and tennis are #1!  Since High School, the stereotype has always been that nerds played golf and tennis, and jocks played the other sports.  So, what’s up with this latest poll?

The Financial Samurai theory:

* Whoever controls the most amount of money is the most influential, and therefore, the most popular.   The reason why Tiger Woods makes $100 million a year is because he generates billions in incremental revenue.  Since nerds by definition get better grades,  they may go to better schools  and get better paying jobs.  Therefore, their chances of making more money increases.  More nerds play golf and tennis, and therefore spend more on those sports. Read more…

Given it’s the weekend, I’m not going to write too much, but two things worth highlighting given it relates to some of our previous posts.

1) Sam Bradford of Oklahoma got injured and his then #3 Oklahoma Sooner’s LOST to BYU (#20).  What does this mean?  He may never play up to his potential again, thereby losing $20,000,000 in guaranteed money by not going to the NFL last year.  Perhaps just as painful, Oklahoma will not be considered to play in the national championships again this year.

Oh well, that’s life.  Who needs the money anyway when you can have so much fun in college and get your degree?  However, all you prospective pro athletes, please feel free to shoot us an e-mail for advice.  We’ll look out for you, even if the Sooner faithful won’t look out for Sam by telling him to stay!

Related Post: “Forgoing $50 Million For The Love Of Football”

2) The September/October issue of Washington Monthly come out with a new type of college ranking.  I thought it was intriguing because they basically bash US News & World Report’s methodology, due to the blatant cheating by some faculty at Clemson and University of Florida to manipulate the results.

Washington Monthly’s believes that “America’s colleges are those that work hardest to help economically disadvantaged students earn the credentials that the job market demands.  They contribute new scientific discoveries, and they emphasize the obligations students have to serve their communities and the nation at large.” Hence, they offer three broad rating categories: Social Mobility, Research, and Service.

The 10 Best Universities in America

1. UC Berkeley (#21 in US News)

2. UC San diego (35)

3. UC Los Angeles (25)

4. Stanford University (4)

5. Texas A&M College Station (64)

6. South Carolina State University (NR)

7. Penn State (470

8. The College of William & Mary (32)

9. University of Texas – Austin (47)

10. UC Davis (44)

Several observations: 1) California schools dominate.  2) There’s only one private school in the Top 10.  3) The traditionally perceived elite schools are not there except for Stanford.  Is spending $50,000/year to go to private school in the east coast worth it?  Hard to say after reading the report!

Related post: “Survey Says: Get 1,300 On Your SATs & A 3.9 GPA And You’re Set for Life!”

Hope everybody is having a great weekend!  Upcoming posts will be about Net Worth, The Right Sports, and How Everything Is Relative.

Keiju,

Financial Samurai

Slicing Through Money’s Mysteries

I was cleaning up my basement and realized the best things I’ve bought were simple and affordable, and have provided years of entertainment.

Here’s my list:

• A pair of Hi-tech hiking boots.  Cost: $65.  Age: 5 years.
• A Cannondale mountain bike.  Cost $250.  Age: 7 years.
• A Wilson Basketball.  Cost $30.  Age: 4 years.
• A Martin acoustic guitar.  Cost $350.  Age: 10 years.

The great thing about this list is that pretty much anybody can afford all four or at least one of the four.  How easy it is to strap on a pair of hiking shoes and go for a zen journey into the wilderness. How nice it is to go for a ride down the back roads without a care in the world.  There are community centers all around with indoor gyms, which are especially convenient during the winter months.  Finally, nothing beats strumming that new tune until your fingers go numb.

Maybe it’s true.  The best things in life are free, or close to it! It makes me happy knowing that if I ever had to go back to my old McDonald’s job again, my leisure activities wouldn’t decline as precipitously as my income.

Readers, what are the inexpensive things you like to do?  What are the affordable things you’ve bought that have provided you years of enjoyment?  Have a great weekend!

Best,

RB

Financial Samurai

Over at a new found site called ” The Writer’s Coin,” the 28 year old personal finance writer questions whether he should buy this house if he only has 13% down.  Mind you, he has been giving personal finance advice for a couple years now, and is even a guest poster on mega-site Wisebread, which Financial Samurai may one day contribute to.  Honestly, I felt like I was watching one of those Holiday Inn commercials reading his post.  A guy would provide some great advice and become a medical doctor because of his one night stay at the hotel chain.  But what about the next night when he has to sleep at home?

WC’s question got me thinking.  If someone who has been disciplined enough to write about money matters still can’t see the fallacy of buying a house with only 13% down, why are we so weak when it comes to housing? Do people just blindly fall in love with something and disregard every financial principal?  Doesn’t seem like WC has much more saved up than 13%, because who says “13% down” anyway?  Why not 10%, 15%, or 20%?  Heck, back in the good old old days, people paid 100% down.

How did we come to this pitifully low downpayment standard in America?  Probable explanation #1) It’s the Madoff Syndrome aka greed!  ”I want this, and I want it now!” and #2) The Nesting Syndrome.  There is a tendency for those in a long term relationship who want children to buy a place.  I don’t even have to read WC’s about page to guess he’s planning on getting married or having kids.   For the guy specifically, the itch seems to start at 30, if not sooner.  The desire of owning our own castle and showing we’ve “arrived” is strong.  Read more…

Everyday, we are inundated with e-mails. I personally get over 300 a day, and other colleagues I’ve heard get 500.  Despite many of the e-mails being largely irrelevant, or impersonal given the blast distribution trend, it’s worth responding every once in a while with a “Thank You” and a recognition of what they’ve sent.

Most of the time all the emailer wants is for someone to respond and recognize their work.  How many times have you proceeded to review your e-mail AFTER you sent it, just so you can relish in what you’ve said?  Yesterday, I spent about 30 minutes consciously responding to about 12 e-mails which I normally wouldn’t have responded to, and it felt good.  Furthermore, I sent out another quick 22 e-mails of congratulation for those who got promoted to celebrate their success.  All replied, and were extremely appreciative. Read more…

Who's Behind The Shadow Government?

After reading several of my favorite sites out there, I’m beginning to wonder whether there is a shadow government running America.  The “Cash for Clunkers” program will cost the US tax payer $3 billion to graciously put 700,000 people who drive beaters into cars costing 5-6X more.  Yay, there’s a one time boost to August US auto sales due to hundreds of thousands of people who can’t afford new cars (according to the 1/10th rule)!

Over at DINKS Finance, I’m reminded that the income limit for Roth IRA contribution for single people is $105,000.  So they’re telling us after saving a party-throwing $6,000 bucks, the moment you make over $105,000 you can no longer contribute?  Too bad for you 29 year old grad students out of business school with a median income of $105,000.  Oh yeah, and all you doctors who spent 8+ years of your life AFTER college and those bagillion hours studying, so sorry!  The government isn’t willing to help you save for retirement.  No soup for you! Read more…

Someone once said, “nothing is certain except pressing the reply all button by mistake and taxes.” How true the saying as we face rising taxes under the new administration.  Supposedly 32% of Americans filers pay ZERO TAXES!  I doubt this statistic sits well with the other 68% of files who pay taxes.   I also doubt the percentage of non-tax payers could be that high, but either way, even 15% is a lot.  The good thing for high income earnings is that the highest marginal tax rate has come down by almost half  since the 70′s.  Furthermore, generally if you are paying no taxes, your adjusted gross income is less than $8,350 as a single, or $16,700 as a married couple.   Wouldn’t you rather make more money and pay taxes than make little money and pay nothing?

Given we don’t blog for a living, and several readers asked me this afternoon “whether I think higher taxes lead to Socialism in America, Yes or No only”, my answer and thesis is therefore: “Yes, higher taxes do lead to socialism in America.” Read more…