Who Should Pay For The Wedding? A Logical Guide To Lavish Spending

Winter Valentine's by Colleen Kong-Savage

A Wintery Valentine’s by Kongaline.com

Do you know what’s crazy? Spending $25,000 – $30,000 on the average cost of a wedding in America if you make a median household income of $52,000. What’s worse is going into debt to get married, especially since there’s a 50% chance it won’t last!

In many Asian countries, the parents of the bride foot the entire wedding bill because of the now backwards idea that the husband is “relieving” the parents of the financial costs of caring for their daughter. I can hear many Westerns scoffing at this way of thinking, but before the 1970s it was rare to have dual income households in America. One of my neighbors is a 30-something year old woman who still lives with her 55+ year old Chinese mother. Living with your parents until marriage is quite commonplace for many Asian and Hispanic cultures.

The one thing many Asian weddings have that Western weddings don’t have is the ability to make money during your wedding. I went to my friend’s wedding in Taipei and he actually made about $100,000 from his 50 table, 400 person wedding. The Chinese have a culture of giving monetary gifts in the form of red envelopes during weddings and Lunar New Year. If you are a business associate invited to the wedding, you better give at least $500-$1,000 or else you might not have much business left for the year!

In many Western countries, the parents of the groom pay for all wedding expenses. The thought process is that the groom’s parents are honored to have such a wonderful woman be their son’s life partner to love and care for him through sickness, health, wealth, and poverty. I like this thought process a lot, but as a son of middle class parents who went to a cheap public school, I would feel bad for my parents to pay. But as noted with the many commenters in this post, in America, there’s also a strong tradition of the parents of the bride to pay.

Finally, there’s a growing trend for many lovebirds to pay for the large majority of their wedding cost themselves. Out of the past five weddings I’ve attended, all five were predominantly paid for by the bride and groom. I’ve asked other 25-40 year olds and they’ve said the same thing. Perhaps parents might pay for the venue, or the flowers, but certainly not everything.

One of the main reasons why more wedding costs are born on the bride and groom is because they want their wedding to be a certain way. We’re much more picky and elaborate nowadays it seems. And if your parents are paying for everything, they may put a lot of pressure on you to do things their way instead of yours. This may affect the guest list, the location, the vendors, and more.

Do You Have A Hoarding Problem? Five Points To Identify That You Do

Hoarder

Are you a crazy hoarder?

A funny thing is going on in San Francisco right now. After Uber hired Goldman to raise $1 billion in a convertible debt sale, Uber launched a $5 UberPool campaign for a limited time on rides anywhere in San Francisco. UberPool is Uber’s carpooling service where they charge an even lower rate than their UberX offering. $5 to go anywhere in SF is truly a game-changing move that makes me not want to ever drive again in The City. The traffic has turned horrendous with unemployment below 4%.

It takes me about 30 minutes on average to drive downtown from Golden Gate Heights in rush hour traffic plus parking. There’s of course the cost of gas, potential tickets, and the risk of accidents I’ve got to deal with as well. I’d totally pay $10 roundtrip for the 3X a week I go downtown and leave Rhino, my sexy beast, at home.

But guess what? I haven’t called a single UberPool because I’ve currently got 10 free rides, each worth $20 – $30, sitting in my account! I’m not going to burn one ride that now only costs $5 with one of my $20-$30 credits, no sir! I’m going to hoard my free rides for when I go to the airport – a $30-$35 fee from my house. You see, if a ride only costs $15 and I use one of my $30 credits, I lose the other $15. And even if the app is smart enough to let me use the $5 promo on UberPool, instead of automatically applying one of my $20-$30 credits, I’m still not willing to risk it.

Like any good frugal person would do, I told my friends to book an UberPool instead, and take me along for a ride. Genius!

How did I get all my free ride credits? That’s easy. Each person who tries out Uber using my referral code gets a $20 free ride and so do I. All you gotta do to replicate my Uber credit galore is spend 25 hours a week writing for five years in a row and you’re good to go!

Too bad the promotional value is only $20 a ride now, down from $30 in 2014. But they’ve now smartly shifted the promotion strategy to subsidizing drivers with their $5 UberPool to get consumers to try their carpooling service. If you haven’t tried Uber, it absolutely makes transportation cheaper and easier.

Increase Your Savings By Identifying Specific Reasons To Save

save money for freedom. Jamaica panorama

Save money so you can live a free life! Jamaican sunset

I was invited to join the TaxACT How I Save blog tour which shares ways to keep more money in your pocket. Last year, TaxACT saved America over $240 million on tax preparation. 

One of my main goals for 2015 is to save $100,000 in new liquid cash after spending too much money on remodeling in 2014. I got down to around $25,000 in liquid savings towards the end of the year and it just didn’t feel enough for me. Each person’s desire for liquidity is different given our living expenses and risk tolerance levels are all different.

The reasons why I want to have roughly $100,000 liquid at all times is as follows:

1) Minimum private equity investments generally are around $50,000, at least all the ones that have been presented to me. The last thing I want to do is only have $25,000 and not be able to invest in the next Uber.

2) It’s always good to have cash on hand when the stock market throws up. The general long-term trend is up and to the right. I want to implement my own advice on how to better dollar cost average with $5,000 – $10,000 investment increments at a time.

3) I have a goal to pay down my first rental property mortgage within 12 months. There is roughly $85,000 left in principal from this 11.5 year old mortgage (started at $464,000), which is starting to annoy me. I will be averaging roughly $7,000 a month towards paying down extra principal along with my usual monthly mortgage payment that pays down $1,100 in principal in order to achieve my pay down goal. Having $100,000 allows me the flexibility to pay it all off in one go, or give me the confidence to keep on my $7,000 a month plan.

Always Work On Improving Cash Flow For Financial Independence

Cash Flow For Financial Independence

Cash Flow by Jo Z-Sunny

The other day I asked a very wealthy entrepreneur about his main financial concern. He’s probably worth anywhere between $50 million to $75 million dollars. Given he has so much money, I thought his answer would be more philosphical, like “making sure my kids appreciate the value of money,” or “how to create a lasting legacy.”

Instead, the entrepreneur responded, “My biggest concern is making sure I have enough cash flow to maintain my lifestyle.”

I initially thought the answer was odd because why bother measuring cash flow given he can simply draw down principal to fund his lifestyle forever. $500,000 here, $1 million here, who cares? He’s still left with tens of millions of dollars left over! But maintaining a lifestyle that is meaningful to you is what having money is all about.

Many people with tremendously high net worth figures don’t have nearly as much LIQUID net worth as one would assume. People mistakenly think that just because someone has a $10 million net worth, that they can withdraw 10 million $1 dollar bills and make it rain. Instead, high net worth individuals likely have much of their net worth tied up in equity stakes that could disappear if a downturn like 2008-2009 ever happened again.

Just look at the guy who founded CNET, the technology online review site. He was worth $2 billion dollars, but after a divorce and leveraging up in 2007, he filed for bankruptcy. Every super wealthy person I know is well aware of how ephemeral wealth is. This is why buying real assets, like property or fine art is so attractive to many equity millionaires.

10 Helpful Financial Moves To Make Every Year

Financial Moves To Make To Get To Santorini

Cheers to the best time of the year!

The end of the year is always the best time to reflect and plan. I’d like to share several financial moves you should make before the new year in order to protect your wealth and hopefully grow your wealth in a risk-adjusted manner next year.

Those of us who invested in stocks, real estate, and many other asset classes except for oil should be feeling fortunate. But don’t forget that good times seldom last forever. Never forget the Armageddon days of the 1997 Asian Financial Crisis, the 2000 dotcom implosion, and the housing + financial meltdown that began in 2008. Those of you who haven’t been investing at all better get ready to deploy capital when chaos returns, or else inflation will eat your wealth alive.

If you just started investing in the past five years, lucky you! Don’t worry. Your beat down will happen eventually. But like every beat down, things always get better over time. Look at all of us old farts who are still around.

Your Friends Really Do Influence Your Spending Habits

Wimbledon Center Court Roger Federer

Watching Roger Federer on Center Court at Wimbledon 2014. Bucket list item.

I met up with a friend of mine the other day for a function. He rolled up in a new Lexus IS350 that costs about $43,000 out the door. Immediately, I was envious of his wheels given I just drive a $20,000 Honda Fit named Rhino. My thoughts of doing the economical thing of buying out the residual value after the three year lease expires went out the window. I began fantasizing about what sports car to buy in 2017.

No, no, no! I told myself several minutes later. Sure, I’d love to drive a fancy car, but I reminded myself that I hate the stress of worrying about damaging expensive things. I enjoy parking in a crowded parking lot and not caring about a door ding. I’d much rather own stuff I can just throw away without any after thought.

Back in 2005-2008 I was extremely into collecting fancy watches. One friend had a FOMOYOLO mentality and bought a couple $8,000 IWC watches, just because he liked their style. So of course I started collecting watches because I thought, why not me too? I’ve got just as much money as him and I work harder. The funny thing is, before hanging out with my friend, the most expensive watch I’d ever purchased was a $500 Seiko. Now here I was spending $12,000 on a Rolex Stainless Steel Daytona. It was nuts!

The Median Net Worth Of US Households Over Time Has Gone Nowhere

Median Net Worth Of US Households Over Time In 2013 Dollars

Edward Wolff, a professor of economics at NYU put together a really shocking median net worth chart over time in 2013 dollars I wanted to share with everybody. The main takeaways are:

1) The median net worth of middle class households has dropped by a whopping 44% since 2007 and has not recovered after the worst was over in 2010.

2) The median household today is 6% poorer than their parents were in 1969.

3) There have been periods of income declines before from 1990-1995, with large rebounds over the next 10 years.