Codes
CAR SPENDING
1/10th Rule: Spend no more than 1/10th your annual gross income on a car. If you make $50,000, buy yourself a nice second hand Honda Civic for $5,000. Multi-millionaires don’t spend more than 1/10th their annual gross income on cars, neither should you.
Article: “8 Cars In 10 Years. I Have A Problem But You Won’t”
HOUSE BUYING
30/30/3 Rule: Before buying a house, have 30% of the value of the house in cash, so you can put down 20% and have a 10% cash buffer (30% total). Spend no more than 30% of your monthly income on your total house payments. Do not buy a house valued at more than 3X your annual gross salary.
Article: “Three Home Buying Rules To Follow”
SAVINGS
15% Rule: Save at least 15% of your gross salary after maxing out your 401K. Maxing out all retirement plans should be a given, but you cannot count on your 401K and IRA to be there when you retire. Hence, save an additional 15% of your income every year.
Articles:
“Your Net Worth Is An Illusion, Sorry To Spoil Your Delusion”
“The DVD Method To CD Investing For Maximum Yield”
CAREER
Get In First, Leave Last: Unless you think you know everything there is to know about your job, clients, and industry, work harder than nobody else and succeed like nobody else. Don’t feel you are better than others, especially the first 5 years of your career or new job. Pay your dues.
Article: “Do Rich People Try Harder?”
MOTIVATION
Use Rejection As A Motivational Tool: Nobody goes through life unscathed. From your first crush, to your first promotion, chances are you didn’t get there in a straight line. Instead of complaining, do something about it. Just keep trying until you succeed.
Article: “You’re Rejected! How I Use Rejection To Motivate Me Every Single Day.”
SET GOALS
Look Forward To Progress: Progress is beautiful especially when you start off small. It matters less whether you achieve your goals than if you are heading in the right direction.
Articles:
“Samurai Predictions and Resolutions for 2010″
“Samurai Predictions and Resolutions for 2011″
“Don’t Be Afraid To Make New Year’s Resolutions”
LIFE
Choose To Be Happy. You can be a black cloud and a pessimist, or a white cloud and an optimist. Choose to see the good in others!
Article: “An Ambulance Screams By, Do You Feel Happy Or Sad?
Financial Samurai (724)
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These are great codes of honor to live life by, samurai!
Though I think the majority of people in Vancouver (and I think San Francisco too) violate the 30/30/3 rule because most people buy places that are way more than 3x the gross household annual salary =(
I especially like the Get in First Leave Last. Although I don’t get in first, but I do get in on time, I usually leave last. I think it’s especially important for us young folks (20 something crowd) to show the Generation X’ers and other generations that we know how to work hard (even though it might not look like it a lot of the time!).
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This is quiet awesome! While reading I was mentally calculating my situation, 30/30/30 rule I can apply now. though property price is quiet high here in south Florida, still I can make up all three. I am also planning for a new car, will keep my grand ol’ 2002 Hyundai Elantra, it runs fine still. But want to gift myself a Camry or so..1/10 rule, is bit impossible I don’t earn $200000 per year.
I am very much interested in reading “Your Net Worth Is An Illusion, Sorry To Spoil Your Delusion” such a lovely title! right after I stop writing this comment.
I am a late starter in blogosphere, learning and learning..reading and then again learning, and in between little writing. It might happen one day that there are only blogers, but no readers. Any ways let me now read rest of your interesting posts.
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These are great codes and I wish that I had known them sooner! Do you have one for school loans?
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