Why I bought a Power Rack!

Why I bought a Power Rack!

I considered titling this article, “Why I bought a Power Rack and Why You Should Too” but the fact is you don’t need a power rack to get a good workout in or to reach your fitness goals. The fact is that after several years of working out and many hours of research I chose to invest in one so I could further increase my efficiency and ability to perform certain exercises while maintaining a safer lifting environment.

While I hope this article might help some of you who might be considering the purchase of a power rack, it’s primary purpose is to share my own unique situation and insight into obtaining a tool to further my own health and fitness goals.

 

A few months ago I made one of the biggest financial investments into my health and fitness lifestyle that I’ve made in a long time. I bought an Elite FTS Professional Power Rack R3 which came with lots of extras. In total I got $3,900 worth of equipment for $1,500. I wish I could say that it was a hard decision, but with a little research it quickly became a no brainer for many reasons and I’ll tell you why.

It’s an investment

Do I need a commercial grade power rack? Hell no. But am I glad I bought one? Hell yes!

There are many types of racks on the market, many of which are a lot cheaper than the one I purchased. That being said when the opportunity to buy something at such a discounted rate came along; I didn’t let it pass me by. I also didn’t buy on a whim. I was in the market for a power rack, found what looked like a good deal and proceeded to do several hours of research before I even started to negotiate with the seller.

Here is a comprehensive list of everything I got for the $1,500 and what it costs retail:

Power Rack  $           2,124.00
Dip Attachment  Included
Step Up Attachment  Included
Bands (New/Unused)  $               150.00
Barbell Pad X 3  $                 30.00
Quick Adjust Safety Pins  $               119.00
Ab Straps  $                 40.00
Bench with Seat  $               319.00
Crunch Attachment  $                 69.00
Hyper Core Attachment  $               175.00
Leg Attachment  $               129.00
Weights and Barbell  $               584.00
Stall Mats X 4  $               160.00
TOTAL  $           3,899.00

Not a bad deal right? What’s that, $1,500 is still a ton of money? Your right, it is. But let’s consider a few things.

  • I don’t pay for a gym membership. Looking around my area, the cheapest option for a gym membership is a 24 Hour Fitness Sport about a mile away. Total cost for a 1 year membership is $350.72 or $29.23/month (paid up front, it’s higher if you pay monthly). At this rate it would take about 4.3 years for the equipment to pay for itself. When you start looking at memberships to LA Fitness or Lifetime Fitness the memberships cost are easily in the $500-$700 range. “What about a $10 / month membership to Fitness Unlimited!?” While I have nothing against them and there’s even one close to me they actually don’t have power racks, and there selection of free weights is pretty limited.

 

  • I don’t have to spend time driving there, checking in, or competing for equipment. Living in Houston Texas, traffic is a fairly big factor. Just going a mile down the street can easily take 15-20 minutes. If it’s rush hour you might as well just run there and back which is what I used to do. Don’t even get me started on people who hog equipment and stand around like it’s a social club chatting. I’m sure you’ve also heard about the newbie who has to get his six-to-eight sets of bench presses done and can’t let you squeeze a set in while he’s taking a 3-5 minute break. Guess what? That guys real, he exists, and there’s more than one of him.

 

  • I own the power rack and all the equipment outright and can sell it at any time. Based on my research I could easily re-sell this equipment for as much as I paid for it. If I sell the equipment individually I could probably make even more money than I spent on it. How’s that for an investment?

 

  • Most of the equipment will last for several lifetimes. Without making this a product review (something I might do later on), the rack I bought is commercial grade and is so damn durable I have no doubt my grandchildren’s children will be using it if there so inclined.

 

  • I don’t include tax which would be another $322.00 or shipping which is easily $200 + if I purchased it retail.

Growing out of my current weightlifting equipment

Since I started exercising my collection of workout equipment has increased and in a sense, I’ve outgrown some of it. I already had a good bench, an Olympic barbell, a set of Powerblocks (adjustable dumbbells) and even a decent all in one home gym.

Over the course of about two and a half years, I was able to achieve a pretty shredded natural physique with this setup.

However, I was missing the ability to do some of the most basic and important lifts such as the barbell bench press and barbell squats.

I knew that in order to get the most return out of the time I spent lifting that I needed the ability to actually do the type of heavy compound lifts that make up the core of any good weightlifting routine (Squats, Bench Press, and Deadlifts).

Having the Space

I’ve been lifting in a home gym since I started back in 2013. As bodybuilding grew from a hobby to a passion and then finally a lifestyle, so to did the space and equipment I wanted to optimize my time spent lifting.

Don’t get me wrong here; anyone can get a shredded physique with a pair of dumbbells and a workout bench.  But when it comes to optimizing your time spent working out, having the right setup can save you a lot of time and help you achieve your goals a little bit quicker, safer and can be done without breaking the bank.

That’s why in 2015 when I bought my first house I dedicated an entire room to working out. Finally now in 2017 I have moved into an even bigger room and now have the space for a power rack.

 Safety

I’ve always lifted by myself. Not always by choice, but generally speaking the more controlled my workout environment is the more consistent I am and the better results I have.

The ability to be able to go into my home gym whenever I want and get work done is a beautiful thing.

When it comes to safety, the problem is most of the time there’s no one around to help me if I get in a jam while performing certain lifts.

With a good power rack and good form you don’t need to worry as much when you hit failure on a set of heavy ass weights. You can simply work to failure and if necessary let the barbell down to the safety bars.

Practicing how to fail correctly and how to properly dump the weight only serves to further my safety and ultimately helps prevent injury.

Bottom Line

You don’t need a power rack or big, expensive, and complex setups to obtain your health and fitness goals. That being said, having a power rack can certainly help by increasing efficiency, safety, and by increasing the range of exercises you can perform.

Always do your research, don’t buy on a whim because you think your getting a good deal, buy when you know your getting a good deal. Google and Craigslist are your friends.

Be patient and disciplined. If you only give yourself a week as opposed to 2-3 months to find a good deal your probably not going to find one.

Plan ahead. If you buy a power rack now, will you have space for it in 1, 2, or 5 years down the road? Nothing sucks more than having to give up shit you paid for because you can’t fit it into your new place.

Having a power rack wont make you lift with good form. Sure if you hit failure you can dump the weight and it makes getting that last rep in a little safer. However, if you have poor form your still going to jack up your body through unnecessary wear and tear or you will take a trip to snap city.

 

As always, I appreciate your comments and feedback so don’t be shy about dropping me a few lines in the comments sections below! Also, if you liked this article please feel free to share it on Facebook, Twitter, etc. Cheers!

 

 

What Is an IRA?

What is an IRA?

An IRA or IRA account is a Individual Retirement Account that allows people to make annual contributions which can than be invested into stocks, bonds, mutual funds, etc and continues to grow under a tax deferred status.

The primary functions of an IRA are:

  • Provide individuals who don’t have an employer sponsored retirement plan such as a 401k, an investment tool to help save for retirement.
  • Provide a tax deferred account in which no capital gains or dividend income is taxed until it is withdrawn.

To understand the implications of how amazing a tax deferred retirement account can be, we need to look at the different types of IRA’s.

What’s the Difference Between a Roth Ira and a Traditional IRA?

With a Traditional IRA, the amount you contribute to your account is deducted from your taxable income in the year you make your contribution.

For example:

Let’s say Mike made $40,000 in 2016. Mike is 25 years old and made the maximum contribution of $5,500 to his traditional IRA. When Mike goes to file his federal income tax return he gets to deduct the full $5,500 from his taxable income. Therefore (excluding other deductions) Mikes original $40,000 is only taxed as if it were $34,500.

According to the IRS income tax calculator which you can find here. The difference this makes is quite significant:

  • If mikes full $40,000 was taxed he would have paid $3,978 in taxes.
  • With the $5,500 deduction Mikes taxable income is only $34,500 and he would have paid $3,152 in taxes.

Mike just saved $826 he would have otherwise paid to the IRS and put away $5,500 for retirement!

With a Roth IRA, you don’t get to deduct your annual contribution from your taxable income, instead the earnings you make from your investments within the Roth IRA account and the amount you withdraw from the account simply isn’t taxed.

For example:

Let’s say Mike contributes the current maximum IRA contribution limit for his age of $5,500 annually to a Roth IRA account. When mike reaches the IRA retirement age of (59 1/2) he can simply withdraw the money he contributed over the years without having to pay capital gains tax on his earnings, or income tax on the amounts withdrawn.

For example, if Mike (age 25) invests his $5,500 into the Vanguard Total Stock Market                                                  Index Fund (VTSAX) and earned the market average return of 7% every year he would earn $385.

Short Term = Less than one year Long Term = More than one year)

Assuming Mike is still in the 15% (long term) capital gains tax bracket at the IRA retirement age he would be able to defer the 15% capital gains tax on the $385 he made or $57.75 keeping the full amount.

When you factor in an annual contribution of $5,500 and compounding interest over 34 1/2 years (from age 25 to 59 1/2) that’s some serious tax savings!

In addition to not paying capital gains tax on a Roth IRA, Mike wouldn’t have to pay income tax on any of the amount’s he withdrew from the account either. That’s huge!

 

 

 

 

 

 

Two Stepping Your Way to Financial Success in the New Year

It’s a new year and with it comes the countless New Year’s Resolutions people make in an effort to improve themselves. While most people seem set on changing there physique (a worthy new years favorite) I want to draw your attention to a few key time-sensitive financial goals that should take priority as we enter 2017. All of these goals revolve around getting money back now as well as setting you up for future financial success by maximizing tax savings, retirement benefits, and getting back money that’s already yours.

#1 Maximizing your tax return

Do you always opt for the “standard deduction”? Most people do and never take the time to really figure out if an itemized tax return is more beneficial. Guesstimating the best deduction is guaranteed to leave money that’s already yours in the pocket of the IRS. There are so many tax exemptions out there that go unclaimed because people simply don’t know about them or how to claim them.

  • Mortgage interest
  • Mortgage refinance fees (points)
  • Energy efficient home improvements
  • Student loan interest (paid by you or your parents)
  • Medicare premiums for the self employed
  • Child care credits
  • State sales tax
  • Charitable donations
  • Job hunting expenses
  • Moving expenses (when moving for a job)

Do yourself a favor. Get all of your tax documents together and start looking for tax exemptions, credits, and loopholes. Google is your friend here. The IRS has many of them listed on there website which you can find here. The potential to save or get money back is huge.

I know spending 2-3 hours researching tax credits and deductions can be agonizing, but time spent on this endeavor will pay for itself in knowledge alone. How’s that possible you ask? It’s because at some point in your life your most likely going to qualify for some of these tax breaks and its up to you to make sure your educated about them.  Ask yourself these questions:

  • Do you ever plan on buying a home?
  • Do you ever plan on having children?
  • Do you plan on getting married?
  • Are you or will you ever be self employed (I.E. do you own your own business)?
  • Do you have student loans?

If you answered yes to any of these questions than there are tax breaks out there that you will eventually qualify for. Chances are you already have achieved some of the above and are already qualified for several tax incentives. Really the only question that remains is whether or not an itemized deduction saves you more money than taking the standard deduction.

How much is the standard deduction?

The standard tax deduction (in 2016) for a single person filing a separate tax return is $6,300. If your married and filing a joint federal income tax return that amount is doubled to $12,600. If your single and filing as the “head of household” meaning you have dependents (children, family or others) who live in your household and who you take care of, the standard deduction is $9,300.

In deciding which deduction to take you need to do some simple math. If you find that your list of itemized deductions exceeds the standard deduction amount you qualify for than your better off going with the itemized deduction. Likewise, if the standard deduction is more than the the itemized deduction than go with it.

For example:

Mark is a single 27 year old male who owns his own home. He lives in Texas where there is no State Income Tax.

  • He paid $3,411.73 in mortgage interest to his bank.
  • He paid $834 in State Sales Tax
  • He paid $3,626.68 in property Taxes
  • He paid $1,600 to his HOA (homeowners association)
  • He paid $60 for previous years tax preparation fees (this includes accounting services like H&R Block)

In total his itemized tax deductions were $9,532.41. That’s more than 51% higher than what would have been his standard deduction ($6,300). This easily translates into getting back hundreds of dollars more when he files his taxes utilizing an itemized deduction versus the standard deduction.

#2 Make your IRA contributions sooner rather than later

If your not contributing to your IRA or don’t know what an IRA is, check out my post here. By maximizing your IRA contributions at the beginning of the year you enable those funds to start growing that much sooner. Currently, the maximum contribution limits are $5,500 for those under 50 years of age and $6,500 for those over 50. How much of a difference does a few months make? Well if you take the average long term return of the SP 500, adjusted for inflation and dividends, it returns an average of 7% per year.

7% per year / 12 months = 0.583% per month

The IRA contribution deadline is around mid April of every year. The deadline for 2017 is 4-17-17. Assuming someone makes the maximum contribution before January 17th they have 4 extra months on someone who waits till the deadline.

4 months x 0.583% = 2.332%

$5,500 x 2.332% = $128.26

That $128.26 may seem insignificant to some, but when you make it a financial habit every year it definitely adds up.

Over the course of ten (10) years that $128.26 you earn every year, compounded at 7% interest annually has the potential to equal $2,148.45. If you can make your money start paying you that much sooner why wait? It’s these type of financial habits that help you save and earn more money faster which leads to financial independence!

Thanks for Reading!

There’s so much we can do to make our money work for us sooner. All it takes is a little time and effort and you can find numerous ways to pay yourself or simply stop giving away your hard earned money away. By taking this principal and applying it across as many faucets of our life as possible, we as individuals can begin developing financial habits that earn us long term returns. Let me know what you think in the comments section below!

 

 

 

The wonders of the small cooler!

Fourteen days, 2,471 miles round trip, in a car with my wife…need I say more? Ok that sounds a bit worse than it actually was. We did however have a very long trip recently that stretched halfway across the country and back. All in all the trip went great. We saw family and friends, ate our hearts out, and walked many miles through new cities. For the purpose of this blog though, I want to discuss our wonderful small green cooler!

Over the years my wife and I have purchased/been given/found a number of coolers of various sizes and shapes for various purposes. Recently though, (within the last year) we acquired a small, very portable, rigid plastic cooler. The purpose for this cooler was to take with us when we traveled on various multiple day trips that we seem to take quite often. Sometimes it’s to go camping, sometimes to see family. These trips last anywhere from a long weekend to as long as three or four weeks. We’ve tried a larger cooler that takes up quite a bit of space and gets quite heavy when loaded down with food, beverages and ice, but it seemed to just get in the way and we would end up throwing out food that had been sitting in a slushy mess for too long. All we needed was something to throw snacks and drinks in with the occasional leftover for good measure.

 Enter the Igloo contour 30qt cooler. FYI I don’t work for a cooler company.

Anyway, we got this cooler because we forgot to grab the one in our garage and we were already about 300 miles out of town. We already had a 70 quart and decided we wanted something smaller and more portable. This one has been perfect! It’ll hold a few greek yogurts, couple 20 oz beverages of your choice, some leftover containers from last night’s dinner and a 10lb bag of ice to keep everything cold. Really it can hold more than that but that’s about what we end up with on a normal two or three (driving) day trip. It allows us to carry non fast food to eat that would usually need to be in a fridge, like yogurt or cheese sticks or a few cans/bottles of soda so we don’t end up buying them from a gas station. We also like to end our days eating at a restaurant vs. a fast food joint and having the cooler allows us to keep our leftovers for breakfast or lunch the next day. Also because it’s small it’s fairly easy to move around in the car or take into and out of a hotel room or house.  

Other than use on road trips, I can see this cooler being useful for beach trips, picnics, tailgating, softball league night, or any other scenario you may need to keep food or beverages cold for a short amount of time. This cooler isn’t something to take camping for the weekend with the family or on any other trip you need to store larger amounts of food. Also the only thing I DON’T LIKE about this little cooler is that there isn’t a drain at the bottom; you have to tip it over to drain the melted ice out.

So, if you need a way to keep things cold and don’t want to haul around a beast of a yeti (or take a second mortgage to get one), consider this little igloo.

Rental Agreement and Your Tenant Rights – How To Get Your Security Deposit Back (Part 1)

Don’t let someone keep what’s rightfully and legally yours.

While rental agreement’s and tenant rights is a fairly broad topic, this post will focus solely on how to go about getting your security deposit back in the event that the landlord is being sketchy and trying to keep it without just cause.

I like to think of this post as a case study as it is inspired by a friend who is currently dealing with a landlord who is trying to keep her security deposit for no other reason than to bank a few extra bucks. That scoundrel!

One of the many things my job entails is the management of over a dozen rental properties. Over the past four years I’ve obtained a firm understanding of both the landlord/management side as well as the tenants side in dealing with the various moving parts involved in renting property.  That being said lets get to the facts of this case study and look at some of the mistakes that were made and what you should do if your in a similar situation.

The facts:

  1. My friend whom we’ll call “Lucy” found a room for rent on Craigslist. After verifying the landlords identity, that he actually owned the property, and speaking with other tenants living in the house, she negotiated a monthly rate of $350 with a $200 security deposit.
  2. They executed a lease on a month to month basis on 9-1-2016. She paid her first months rent along with her security deposit on the same day.
  3. The lease stipulated that there were no early termination fees, nor requirement for 30 days notice prior to vacating.
  4. Due to safety concerns and privacy issues (someone was going into her room when she wasn’t there) 14 days later on 9-14-16 she exercised her option to terminate the lease and promptly removed all of her belongings that same day. She took a slow high quality 360 degree video of the room to show it was left in the state she found it in.
  5. The same day she texted the landlord notifying him of her termination of the lease and requested her security deposit back. The landlord confirmed she had vacated and promised to return her security deposit on the 10-1-16.
  6. On 10-1-16 Lucy followed up and requested to meet up to get back her security deposit. The landlord asked for an extension until 10-14-16. The 14th came and passed and he continued to delay and this back and forth went on until 11-15-16 some 63 days after she officially moved out.

Now at this point it’s very tempting to try to figure out the landlords thought process in keeping the security deposit without any reasonable cause or justification but that won’t help get the money back. We’ve established a timeline and the sequence of events that took place, now lets look at what mistakes were made and what course of action to take.

Mistakes:

  1. Communicating with the landlord via text message. This can be a good way to communicate with a good responsive and proactive landlord about maintenance, letting them know you dropped off the rent, and other day to day occurrences etc. However, texting typically (depending on the state you live in and other factors) has no legal bases. In fact most leases have a stipulation that the tenant must provide written notice of there intention to terminate the lease and request there security deposit back. In this case, written means a typed or hand written letter giving notice of termination and requesting there security deposit back.
  2. Not providing a forwarding address. Another issue is the lack of a forwarding address. In the case of Lucy, she tried repeatedly to meet up or stop by to get her deposit back. The landlord continued delaying. By not providing a forwarding address as required by law, the landlord is not under any obligation to meet up with you or let you stop by.
  3. Not taking action. Obviously having written a notice that you were terminating your lease and requesting your deposit back the day you move out is the optimal course of action. Either tape it to the front door and take a picture or mail it via certified mail return receipt (the latter being the most optimal). In this case waiting until November first was a courtesy but as soon as the landlord delayed a second time she should have written a formal letter requesting her security deposit back.

As I mentioned the back and forth between landlord and tenant continued for 63 days until the landlord stopped responding. At this point Lucy is fed up and just wants to forget about the whole thing. This is probably what the landlord wanted all along but I convinced Lucy, that based on principal she should take the correct actions and follow through on getting her deposit back.

Why? Because he probably is going to continue doing this until someone stands up to him. If your dealing with a similar situation chances are your landlord has gotten away with this exact same thing. It’s illegal and shouldn’t be tolerated. Don’t let someone take whats legally and rightfully yours!

With a little encouragement and some help Lucy decided to continue her efforts, this time with a game plan that is supported by law. Time to take action!

Very quickly we drafted the following letter (names have been omitted for privacy reasons) :

11-15-16

Name of Landlord

Landlord’s address

RE: Return of Lucy’s Security Deposit

Dear Landlord,

As you’re aware, I began leasing a bedroom from you on 9-1-2016. Per our lease agreement I put down a security deposit and paid my first month’s rent. I was on a month to month lease. For safety and security reasons, I exercised my option to terminate the lease on 9-14-16. I removed all of my belongings on the same day and I made you aware of this via text message. I requested my security deposit back via text message on 9-14-16. You confirmed this and told me you would give me back the deposit on 10-1-16. You have delayed returning my deposit now three separate times. Per Texas law you have 30 days to return a security deposit from the time a tenant moves out. It is now 63 days since I have moved out. This is a final written request to return the $200 security deposit I put down when I signed the lease.  Please return the security deposit no later than 12-16-2016. Please return my deposit via check or money order and mail to “Lucy’s forwarding address”. Please let the above address serve as my forwarding address.

I have tried to work with you for over two months now to solve this problem in a respectful and timely manner. However, if I have not received my security deposit back by 12-16-2016 I will be forced to take legal action to recover my deposit plus applicable legal fees.

Respectfully,

Lucy ****

Everything in the letter is true and factual and can be supported by screenshots of there text conversation. In the letter she gives her landlord 30 days to return her deposit, provides a forwarding address, and sent the letter postmarked on the same day. As I mentioned above sending the letter via USPS Certified Mail Return receipt is your best option. Having a signed receipt showing they received the letter can be a valuable piece of evidence if you have to take your landlord to court. Taping a copy of the letter to your landlords front door and taking a picture is also likely to get there attention and provide proof they received the letter although this might be a bit excessive depending on the circumstances. Use good judgment.

It took about ten minutes to draft the letter stuff it in an envelope and drop it in the mail.

Having established a paper trail and following all the requirements set forth by state laws (you can find out more about state specific landlord / tenant laws here) there is nothing left to do but wait.

If you’ve read this far your probably wondering what happens next. I will be writing a follow up on this case study in due course. Until than, feel free to leave a comment below and let me know what you think. Have you ever been in a similar situation, or perhaps you have a method already in place for making sure you don’t have to go through this process. Let me know!

 

 

What is Peer-To-Peer (P2P) Lending?

Peer-To-Peer (P2P) lending is a form of lending in which the borrower receives a loan directly from the lender through an online service. Borrowers include everyday people such as you and I, as well as small companies. The lenders are typically made up of individuals and entities looking to earn a return on the money they lend out. Investors typically invest in notes which is only a portion of the entire loan. This is a defining characteristic of this type of lending in that a single loan is generally funded by hundreds of different individuals / entities and comprised of hundreds or thousands of notes . For example:

John and Sally want to re-finance there credit card debt and apply for a loan in the amount of $10,000.00

There is a $25.00 minimum each individual / entity can invest into a note.

Therefore if everybody chooses the minimum ($10,000.00 / 25 =400) there will be a total of 400 individuals who finance John and Sally’s loan.

In many cases each individual will stick to the minimum loan amount in order to better diversify there loans / notes. More on this later.

What is the benefit of peer lending?

-For Investors-

  1. It’s all done online. This greatly reduces overhead costs and allows companies who facilitate the crowd lending (AKA P-2-P lending) process to pass on the savings. Compare this to the brick and mortar financial institutions who have to cover the costs of maintaining buildings, staff and other tangible assets.
  2. You can choose to invest in loans based on how risky they are. Lower risk loans earn less interest while higher risk loans earn more interest.
  3. Just like a bank, you receive monthly payments on your note in the form of principal and interest. In some cases you even receive late payment fees.
  4. It utilizes software that allows borrowers to filter different loans based on factors such as income, credit score, whether or not they own or rent, how long they have been employed, and many other factors.
  5. It can be a fully automated process. Many companies now offer an option to automate your investing allowing you to dictate how much you want to invest per loan, and what criteria the loan must meet in order for the software to actually make the loan.
  6. With the ability to automate your investing you can choose to be as active or passive as you want when investing in notes.
  7. You can sell your notes on a secondary market. This is handy in the event that you need to liquidate your position.

-For Borrowers-

  1. Applying online is quick and easy (assuming you have all the pertinent information you would need to apply for a standard bank loan). Turn around times are typically around one week. If your lacking information and documents it can take as long as fourt-five weeks depending on the lending platform.
  2. Rates are extremely competitive. As previously mentioned, the entire process is done online and lending platforms have low overhead when compared to brick and mortar financial institutions. This enables them to pass on the savings in the form of lower interest rates.
  3. One of the primary reasons individuals take a peer to peer loan is to refinance there credit card debt.Depending on your credit and other qualifications you can typically get a much lower rate than what your credit card company is currently charging you. This gives individuals a significant advantage when trying to consolidate debt into a lower monthly payment.
  4. Loans come in three year (36 months) and five year (60 months) increments allowing some variation in the length of the loan which in turn effects how big your monthly payments will be.
  5. Your loan is typically funded by hundreds of people and not a big corporate bank.

What are the risk factors associated with peer lending?

-For Investors-

  1. The loans you make are unsecured. This means there is no collateral in the form of a tangible asset backing up your money. As compared to a home loan in which case the bank can foreclose for non payment and sell or auction your house to recover the principal, you have no guarantees if the entity who borrowed your money decides to stop paying. Crowdfunded loans are all based on credit scores, income, and other qualifying factors. This form of investing is on the higher end of the risk spectrum.
  2. Companies who facilitate the loans and investments opportunities can fail. At the core of this whole crowdlending process there are companies who take a small cut of the money being exchanged between lenders and borrowers. They in turn provide the online marketplace where borrowers are vetted, payments are processed, etc. These companies are for profit and some are even publicly traded. In the event one of these businesses goes under, there are typically plans in place for a financial services company to step in and take over the notes. However, this would certainly create a less than ideal situation for investors and borrowers as there would undoubtedly be more inefficiencies and likely additional fees to cover the expenses of the backup financial services provider. At least there is a fail safe.
  3. The notes you want to invest in aren’t always readily available. There is currently a disparity between the number of investors and money available to invest versus the number of borrowers and money being borrowed. Currently there are more investors and more money than there is people borrowing. With the addition of large financial institutions starting to invest via peer lending as well the gap is pushed that much more. This is good for borrowers but bad for investors. The good news though is that companies are now marketing in mass to individuals and companies creating a much larger pool of borrowers.
  4. P2P is the greenhorn of the financial sector and with all new investment vehicles it’s still yet to stand the test of time. It got its footing around 2007 and while it has seen a very devastating decline in the market in the form of the 08 crash, it’s market share was much too small to really matter. Were talking millions of dollars during the great recession where as now its market share is well into the billions.

-For Borrowers-

  1. While P2P beats the hell out of a payday loan or credit card interest rates they can still be very high. Don’t apply thinking a peer loan is your only option. While it’s true you can get great interest rates if you have great credit, it’s also true that bad credit equals a bad interest rate. Don’t get sucked in just because you applied and got approved. Shop around.
  2. While most peer loans are unsecured (meaning there’s no collateral or assets the lender can liquidate in the event of non payment), they won’t magically go away if the borrower stops paying on there loan. The fact is loans stay with the borrower until they either file for bankruptcy or reach a settlement with the lending company which can be a long and frustrating process.
  3. It turns out that people who lend out there money want it back. With interest. If the borrower is late paying they can expect late fee’s just like a bank or payday loan company would charge.
  4. While it’s easy to apply it can sometimes take weeks to get approved and even longer to get a loan funded. If a borrower provides the bare minimum information when applying it takse longer to verify the application. Additionally, as the loan is likely going to be funded by a multitude of individuals it takes time to get fully funded. In some cases the loan might get 90% funded only to be canceled because it didn’t reach the full amount which is required to receive the loan.
  5. Borrowers can be denied or fail to acquire a loan because it wasn’t fully funded. If someone doesn’t meet the qualifications set forth by the lending company they will be denied plain and simple. Unfortunately for borrowers this can show up on your credit history making acquiring a loan from other companies even harder. This is due in part to other companies scrutinizing your application more vigorously because you were already denied which raises red flags. It implies that there must be something wrong with you even if the lending company you just applied with had really high standards.

As someone who loves technology and the simplifying of otherwise complex financial processes I think peer lending is a great tool for both investors and borrowers. It gives individuals a chance to tap new investment opportunities while giving borrowers a streamlined borrowing opportunity. What do you think? Let me know in the comment section below!

How I Make Money on YouTube

How much Money do Youtubers make?

Top level Youtubers make in the millions of dollars. PewDiePie, Youtube’s biggest channel makes over ten million annually and that number continues to grow. Tens of thousands of others make a comfortable six figure income and are able to support themselves full time via the revenue they earn from there channels via google adsense, product placement, merchandising, and branding themselves into a marketable asset. Needless to say there was a huge incentive to create my own Youtube channel. This is partly because of the potential to earn income from the comfort of my own home but also because it easily coincides with many of my hobbies.

So in 2014 I decided to do an experiment. The goal being to create a channel, create and upload content, and see how much money I could generate. I settled on creating vine video compilations. If your not familiar with vines there short six (6) second videos that play on a loop. People upload them via there smart phones. The idea is based on the adult attention span which research shows lasts approximately six (6) seconds. I chose vines that I found to be funny and organized them based on themes such as funny girlfriend / boyfriend, best funny pranks, etc. This helped me to create a targeted niche which which would help increase traffic to my channel.

Now before anyone jumps to conclusions, I want to mention that I got permission to use the vines I used from there creators or used vines that had creative commons tags in my video compilations. Additionally, I credited all the vines I used in the description of my video and also put a link back to the creators vine homepage. This is important to note as simply taking someones content and using it for financial gain can potentially be a copyright violation. Copyright is a tricky business and is ultimately the reason I discontinued adding content to this channel (more on that later).

How much Money did I Make on YouTube?

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As of writing this post I’ve made over $451 for approximately ten (10) hours of work by creating a Youtube channel, uploading content, and than monetizing the channel with google AdSense. It’s not a staggering sum by any means and the money didn’t come pouring in. But it did come and when you look at the income per hour of work put in it  comes to just over $45/hour. The best part is that the 10 hours of work I put in back in June of 2014 is still earning me money every single day. That’s whats called passive income!

In total I spent about one hour per day Monday through Friday creating a short Vine compilation approximately one (1) minute to two (2) minutes in length and uploading it to my channel. I created ten (10) videos in total over the course of two weeks. After that I left the channel alone for several months and waited to see what happened.

Channel Analytics and Results

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Within the first week some of my videos were getting hundreds of views per day. Within a month my channel as a whole was getting over 5,000 views per day! It was time to monetize my channel and start earning some cash. I went through the process of associating my YouTube channel with google Adsense and selected skippable video ads as my primary ad choice. I started earning money the very next day. Not a lot, but when you see a steady stream of income start rolling in that has the potential to continue paying you indefinitely it’s hard not to get a little excited. My daily earnings went from nickels and dimes to quarters and than dollars. On my best day I earned just over $6 and was earning around $75 per month. I wasn’t raking money in, but I was soon earning enough in passive income that I felt my experiment was a success. Of course it wasn’t long before things took a dive.

Where I Went Wrong

Copyright and technology really are a fickle thing. Even though I carefully took the time to find creative commons videos or get permission from the content creators i soon found one of my videos was getting flagged for copyright. I followed the copyright appeal process, providing evidence in the form of emails from content creators giving me permission and creative commons tags for the content I was using but to no avail. I pursued the appeal process all the way through to the end, even contacting the company or individual who claimed I was in violation of copyright but didn’t get a response. I soon found my channel had received a strike for copyright.

If your not familiar with YouTube and how strikes work, its really pretty simple. If you get three strikes on your account, all of its content gets deleted, wiped, terminated. If you get one strike like me, your channel goes through a probation period of 3 months. As long as you don’t get any additional strikes during this period the strike is removed from your account at the end of the three months. youtube-4

I spent a little time doing some research and came to the conclusion that one of two things likely happened. Someone stole the content from the actual content creator and gave me and other people permission to use the content they stole. Or, the content creator licensed his vines/video/content to a media company who in turn sells other people a sub license to said content. Per contract, these media companies than claim ownership of said content on behalf of the content creator and flag all other pre-existing videos containing the newly acquired and licensed content utilizing YouTube’s Content Id system. This system basically enables people to flag videos containing there content in mass and claim they are violating there copyright. Large media companies basically flag content they have acquired with little regard to agreements made previously with the content creators. It’s a complex business that is exacerbated by the fact that this happens millions of times per day across YouTube and the internet as a whole.

In realizing how complex this process would become to further expand my channel I simply decided to stay hands off as I had already done for several months. I would let the channel continue without intervention. Soon my revenue began to decline as videos were subjected to copyright claims, many of which were probably illegal on the part of the claimant. From talking with other YouTubers I came to the final conclusion that unless its your own original content that you created yourself, it’s not worth the time to walk the gray area that seems to make up a large part of internet copyright law.

As of writing this post the channel still has quite a lot going for it.

  • It has over 3 million views.
  • Over 7,500 subscribers.
  • Earns an average of $5.50 per month
  • Gets shared over 200 times per month
  • Has over 20 comments posted per month

What I plan to do with this Channel

As you can see, this YouTube channel still has a lot of potential. If it weren’t for the copyright issues that I experienced right from the start I probably would have put a lot more work into it. Luckily I weighed the risk versus the reward and decided to hold off. Since than, I’ve made other channels and have gained much more experience and am considering expanding this channel once again. Options include creating my own original content, going through the process of purchasing a legally binding license for content, and finding legitimate creative commons content that won’t be flagged for copyright. There are still loads of possibilities and I will continue to update the blog as this channel progresses.

What do you think I should do? Let me know in the comments section below!

 

 

 

 

 

What are Millennials?

The millennials are taking over! No, I’m not declaring war on other generations, I’m simply stating a fact. According to a recent study by Pew Research, they already make up the largest generation in America’s workforce and have an ever increasing amount of influence as older generations retire and die off. That probably comes across a bit brash, but that’s my bluntness talking no disrespect intended. In fact my sense of respect for my older peers is actually quite extensive.

As someone who has a fond appreciation for the lessons passed down to me by my older coworkers and family members, I find it somewhat disheartening when an individual retires or passes away. The Silent Generation (70-87), baby boomers (51-69), and Generation X (35-50) already have many accomplishments to be proud of. Winning World War II, landing on the moon, and the internet to name just a few. Based on there accomplishments, failures and general life experiences we associate certain characteristics with each generation and use those associations as mental shortcuts when meeting and interacting with people. This helps us process information and communicate more easily based on what generational cohort we expect the person belongs to.

But what do we millennials (19-35) have to offer? How do we measure up to previous generations and how are we perceived by the populous? Sure, I can drop names like Zuckerberg and Facebook, describe ourselves as tech savvy entrepreneurs who have an optimistic outlook on life. But what does this mean for the millennialbrothers website and the experiences, advice, and knowledge we want to share with you?

It stands to reason that if the title of the website is going to include the word “millennial” that we should probably find out exactly what that title encompasses and how that factors into personal development. This is especially true considering that much of the advice my brother and I give is based on the millennial perspective that I keep mentioning. The way we look at personal development in terms of finance, frugality, health and fitness, etc, is all based on the research, experiences, and knowledge gained during a particular time frame and under certain social and economic conditions that help to make up this perspective.

Finally, what is a millennial? According to the aforementioned study by Pew Research, a millennial is a word used to describe individuals between the ages of 19 and 35 (based on the year 2016) or those born between 1981 and 1997. It’s a term used as a means to create a generational identity for individuals in this age cohort that have shared life experiences, and have the tendency to share certain positive and negative characteristics.

For example, many millennials will have a certain perception of what it was like before and after 9-11, the election of our country’s first African American president, and the economic collapse of 2008. Furthermore we are likely to be the most educated generation to date but also are associated with massive college debt. Additionally, we tend to rent rather own and wait longer to start having children. Lastly, we are more open to change, vote more often than previous generations and have an optimistic view on life.

Needless to say, the term millennial is little more than a label and like all of the other generations many people choose not be associated with a form of generational identity. That isn’t to say the phrase isn’t important, especially when you consider how useful it is when trying to relay my perspective to that of your own. Like all generations, we see the same things but with different perspectives. Each perspective has a unique insight into what there researching, learning, and experiencing and each provides there own useful assessment of the knowledge gained. It is with this in mind that my brother and I will provide you with our own youthful and unique, but yet valuable millennial perspective. To that end it is my sincere hope that you will reciprocate, sharing your own thoughts and experiences by lending us your voice in the comments section below!

 

 

 

From the other brother…

 

Josh here,

 Just wanted to chime in and introduce myself as well. Like my brother said, our goal is to share the experiences and combined research we have for the purpose of improving our lives and the lives of our readers.

My goal personally, is to provide people with new ways of thinking about old problems and give them ways to solve those problems. My personal interests involve personal finance, tax strategies, travel, and learning new skills. My ultimate desire is to combine the right amount of skill with the right amount of financial independence so that I can travel through life on my terms doing things that I find enjoyment in and use my actively acquired skills to help the people around me.

Most of the time I’ll be in the process of doing or learning something and give you (the readers) the play by play. Hopefully this will give you a thorough idea of what it takes to learn a specific skill or implement a certain strategy. You’ll also be able to see my F-ups and not (hopefully) make them yourself….you’re welcome in advance. I’d also like to have series of posts that really dig into the meat of a subject and let you see the inner workings of how a strategy takes shape, is implemented, and works out over time. We’ll see how it goes and make changes as needed.

Leave a comment and let us know what you think, or ask a question, and thanks for being here.

Welcome to Millennial Brothers!

Hello, and welcome to Millennial Brothers! This is my first blog entry into the world of personal development and I would like to personally welcome you to the website.

My name is Andrew Y. and I have an addiction to personal development. I’m always looking for ways to improve myself, be it financially, physically, or in one of the countless other aspects that we all can improve upon. My brother Josh and I created this blog as way to share our combined research and experience with other like minded individuals with the sole purpose of improving both our life’s and the life’s of our readers.

We started this blog not more than a few days ago and already the wheels are in motion. For years, Josh and I have shared knowledge and experiences with friends, family, coworkers and each other on investing, physical fitness, achieving financial independence, early retirement, managing rental properties, and a plethora of other personal development ideas. We both along with others have turned our hard work and research into tangible results that we now want to share with you.

We plan to incorporate different media into the website to include written, video, and audio content to make this website as interactive as possible. While this site is still early in development, there has been a tremendous amount of planning and forethought put into the development of this site and the type of content we want to bring to you, our reader / viewer. Our goals content wise are quite varied and diverse but contain much overlap as we are obviously brothers and share many interests. We plan to begin writing about what currently catches our interest and than focus in on high quality advice content based hopefully on feedback from readers like you!

As this website continues to develop, I hope you will stop in and take a minute to check out our blog posts. Your feedback is greatly appreciated and will only serve to make me a better blogger and provide better content for you! Here’s to a great start and the development of a website that will help people develop better lives!

-Andrew Y.