Personal Finance and Investing Tips for Hispanics

Did you think that Mexicans and Mexican Americans only drank tequila and coronas?  Absolut-ely Not,  well I suppose that they Now LOVE vodka too specially “In An Absolut World.” All Latinos (Mexican and other Latino Americanos) drink vodka now, it might just be their favorite drink..

 ”The U.S.-Mexico border lies where it was before the Mexican-American war of 1948 when California, as we now know it, was Mexican territory and known as Alta California.

Following the war, the Treaty of Guadalupe Hidalgo saw the Mexican territories of Alta California and Santa Fé de Nuevo México ceded to the United States to become modern-day California, Texas, New Mexico, Utah, Colorado and Arizona. (Texas actually split from Mexico several years earlier to form a breakaway republic, and was voluntarily annexed by the United States in 1846.)”

I would really like to know who is the marketing genius that came up with this add. I guess now he could be either rich or unemployed, famous or imprisoned. But this advertising campaign in Mexico is Absolut –ly  priceless…

I can only imagine the conversations among all people.

Scene 1

“hey Carlos, let’s go get a bottle of tequila cazadores to get smashed!”  No José, I don’t drink that shit no more, it’s all about the Absolut man”. WTF que eso? Replies Carlos. “It’s the future man, it’s the future of the world, well it’s vodka to drink martinis or whatever, who care anyway just drink it, says Jose. Lol

Scene 2

Good evening Mr. Jones, “Would you like your usual martini?” yeah but make it with grey goose, don’t give me that Absolut crap. “I’m sorry, Mr. Jones but we don’t have grey goose” WTF, give a Jack and coke then. “Are you allergic to Absolut vodka sir?” Yeah, that cheap crap gives me a headache! Lol.

Scene 3

Hey vatos I brought a bottle of tequila for the carne asada.  Man how many times we have to tell you, we don’t drink that no more, stupid. Don’t worry Tony, we all now that Fernando is a little slow, “let me explain to this guy, says ricky” Look Fernando we only drink absolut vodka, ‘cause it’s the absolut world, comprendes?

1 vodka and tonic =$10, 1 bottle of absolut = $27.99, 1 absolut advertising campaign in Mexico =Priceless

Salud, Cheers, Salud, Cheers, Bottoms up!!!

As much as I hate to see people cry about losing their homes, they should have thought more about buying a home.  But, you can’t blame people for trying to live the American dream, especially Hispanics that always have the dream.

What I really hate is Latino Realtors screwing their own Latino people, just to get the commissions. I read and read about how Latinos got tricked into buying a home with risky loans. These Hispanic people were pushed in to a loan by their community Latino Realtors.

“Hernandez’s mother bought the house for $488,000 in 2005. She put $100,000 as a down payment, part of the profit from the sale of the small townhouse where she lived with her family for more than a decade.

But Hernandez said his mother was steered into a negative amortizing loan, in which they were allowed to make less than a standard principal and interest payment every month, so the total principal slowly increased. Today they owe more than $500,000 for their home, while at the same time, the value of their house has plummeted. In December, after the terms on their lease changed, their monthly payment shot up to $3,900 from$2,300 the month before. Since then they haven’t been able to make the payments”

I can almost hear the realtor say something like this “ It’s ok Mrs. Hernandez you can refinance in 12 months, blah, blah”, ( just sign the papers so that I can get my commission” and I could bet money on the fact that it was a Latino realtor, which this family trusted because he/she spoke their language.

That is so wrong, but everybody cares about their own live, it’s not the first nor the last time!

Trip to Cancun = $999, 2bd condo rent = $1200, Latinos screwed by Latino realtors = priceless

Would you rather be happy or have money? Many people often get confused about what the want in life, but when it comes to money most people agree that money is important because even when money will Not make you happy forever, it will sure make life easier.

You can ask 20 or 100 people about the subject and you will get different answers, but the bottom line is that money is necessary and in this society with live in.

With that in mind I’ll leave here a few quotes about money

1. “He that is of the opinion money will do everything may well be suspected of doing everything for money” -Benjamin Franklin

2.  “A penny saved is a penny earned.” - Benjamin Franklin

3.  “Never spend your money before you have it.” - Thomas   Jefferson

4.  ” Time is more valuable than money. You can get more money, but you cannot get more time.” - Jim Rohn

5.  “Money doesn’t make you happy. I now have $50 million, but I was just as happy when I had $48 million.” - Arnold Schwarzenegger

6.  “A bank is a place that will lend you money if you can prove that you don’t need it.” - Bob Hope

7.  “A penny saved is a penny earned.” - Benjamin Franklin

8.  “Money, if it does not bring you happiness, will at least help you be miserable in comfort.” - Helen Gurley Brown

9.  ” The love of money is the root of all evil.”- Bible, 1 Timothy 6:10

10.  “Friendship is like money, easier made than kept.”- Samuel Butler

These quotes are to put in perspective, and whatever opinion you may hold about money is well respect it, I just hope that you don’t risk your freedom for money, because then it won’t do you any good.

At this time and age, mostly anyone can become a millionaire with time and effort. Hispanics are less likely be rich because of history but if you follow these below identified simple 5 steps you can be a Hispanic millionaire in the future. Yes you can be a rich Hispanic in America by working hard. All rich Latinos have worked very hard to get their money.

More often than not, we all hear that to be rich you have to have your own business and work hard, or that you have to invest in real estate or simply win the lotto. That’s if you want to be instantly rich, but we all know that everything takes hard work.

Now, here is the trick. You don’t have to make a lot of money like the six figure salaries those lawyers make to be a millionaire in the future. It will take time, but you will be a millionaire with these 5 simple steps.

1. Generate money by earning income (you must work)

Ok. Whether you are on salary that for the average person in the U.S. is between $23,000-$62,000 depending on your skills and where you live, or you work independently by way of small business or contracting you can become a millionaire.Historically, Hispanics have always made lesser wages thought their lives, but you can still do it. Of course, the more money you make the faster you’ll get there.

However, the fact that you only make average money is not an obstacle for you to not make that dream come true. It is important to maintain a positive attitude and to have patience because it is not going to happen overnight. Remember that patience and determinations are virtues.

2. Don’t Live Beyond Your Means.

This means that you shouldn’t go on a shopping spree every weekend just because you have credit or because is on sale with 0% for 12 months. If you don’t have the money at hand don’t buy it. Bottom line, you have to reasonable with your spending because it does Not matter how much money you make if you blow it off on trips, and going out, and on a new car every 2 years. So if you spend more than you make you’re living beyond your means.

Living within your means is about being reasonable. Don’t buy a big SUV if it costs 40k and you make 45k a year, of even if you only have one kid, get a Toyota corolla and keep it for 10 years.  Don’t buy a 5000 sq feet house because it is a waste of money on mortgage, utilities bills, and furniture. I know that many Hispanics like to buy shiny luxurious cars every couple of years, and they never buy a house. So if you want to be rich, you need to be frugal and reasonable. Most rich people have money because they are reasonable.

3.  Always Save Some Money.

Always pay yourself first even if it is 50 bucks a month. This is simple math logic, if you make $10 and you save $1 you’re going to be ahead of the game. If you follow the steps 1 & 2 you should have money after your bills and living expenses. So save it and stop buying crap. In fact if you are Not good at saving, you should make saving a bill, and pay it every month to a separate account every. That’s what I did when I started to get my finances in order. Save, save, save and then save.

4. Learn to Invest positively.

OK. Now that you like to save and that you have some savings, you need to invest it because the money in savings accounts is not going to give you good returns in the long haul to be rich with time. Check out CNN money or Google investing 101 or seek professional advising when you’re starting to invest.

Owing a house should be a part of your portfolio, but Not all of it. After all you’ll need a place to live when you retire, so if you have all of your money in the house is not going to help you much. So, invest in your primary residence, your IRA retirement account, investing account with funds in the market, a rental property if produces cash immediately. Remember that takes time to see the return in the stock market, sometimes you have to buy stock and hold it for 20 years to make a lot of money, but if you don’t always buy low and sell high.

5. Be Patient and Determined and Stick to the Plan to Make it Real.

The trick is to do the steps 1, 2, 3, & 4 and keep at it for as long as you can. Remember that investing $1000 today can become $100,000 in 15 years, so don’t be discourage if you don’t have much money to save and invest, every little bit accounts and the sooner the better. Don’t be miserable by not having fun; just don’t spend all of your money. Invest and save some money even if you have to work a second job for a while. There it is… the 1, 2, 3, 4, and 5, of becoming a millionaire.

Now, if you’re thinking that is going to happen in 2 years, you’re going to be disappointed because most likely it is Not, unless you hit a business and start rolling into cash. So be patient and don’t think like Politician that always wants the power now, and not in the future.  Great things take time, and if you want to be a rich Latino you have to be patient and take the above steps seriously.

The financial problem in the United States can be summarized in just one single word Greed. Creating frenzied economic activity based on over-speculation with an illusion of growth while progressively traveling away from real market value of everything tangible and intangible. Well the economists like to call it a “bubble” and for good reason because it is shiny on the outside, but it has air on the inside, floating to inevitable poof.

In the 1980s, the real estate and construction bubble that burst in Japan that destroyed its economy for nearly 20 years also triggered the Asian financial crisis that rippled to Russia and Argentina in the late 1990s.

In the 1990s, again in the US, another bubble burst with over-valued stocks in Internet and tech start-up companies, a.k.a. the dotcom crisis.

The latest bubble by the name of “subprime” is basically a giveaway on the nature of these loans a.k.a. mortgages. It is ridiculous because subprime means by definition below standard. These subprime loans were only granted only to borrowers whose credit history was in bad shape on simply not sufficient to get a conventional mortgage. Following that up by squeezing these debtors in a sudden steep rise in interest rates on their loans last year gives the face of American capitalism an ugly leer indeed.

There you have it. It is all greed and we all are going to pay off for he leaked money that is now in some investor’s bank account anywhere in the world but in your local bank. It is just greed that hurts us all in the end because the country will have to enter into a depression and high inflation and unemployment. Many of us are going to suffer the consequences of theses greedy acts that will only set us back preventing us from evolving  to a better future.

I know that money matters, Do you? I think that everybody makes mistakes, and when it comes to money nobody is perfect. Many Latinos out there like me are oblivious to money management like I used to be until a few years ago when I grasped the concept of financial independence. I learned from my mistakes, I changed my mentality, and I took action to turn things around. Speaking from experience I know that sometimes we all need to experience things and make mistakes to learn our lessons.

I have put together this 5-item list of the top most important mistakes that people make with money, and I would like Latinos to know so they know and think about their finances and judge their personal situation. If you can avoid these mistakes you will most likely be fine and in the right path to a healthy financial life.

1. Living Beyond your Means. I believe this is the number one mistake that most people make regardless of their income. If you spend more than you make, you are in trouble. It’s basic finance. If you make $30,000 and you spend $31,000 you are in debt and in trouble.

Now, if you make $30,000 and spend $28,000 you are ahead, which means savings. I know that is difficult living within one means, but you’ll never be at ease and have freedom if you spend more than you make.

2. Carrying too Much Freakin’ Debt. I hate debt. How do you like to have money in the bank for 1 day and then nothing, nada because you just paid all the bills? I don’t like it because it sucks. The only debt you should have is a house, period. But I know that if you don’t need a house that is 5 beds and 4 baths for $500,000 don’t buy it. Buy the one smaller one for half. I know that us Latinos like to have big houses because we like to keep family around. Some of you may be thinking that you’re saving money in the house, but that is only true up to certain extent. Keep the debt % low.

3. Not Having an Emergency Fund. If you don’t have this emergency fund for when stuff hit the fan, you are in trouble. Taping into your 401K is not an emergency fund. When you get fired, or sick you need some cash to get buy while things get back to normal. An emergency fund is about 3 months worth of expenses. So if you don’t have an E-fund, you need to start one right now. By the way Credit cards are not a “Emergency fund.”

 4. Lack of Savings. This is a big one, most people owe so much money that they can’t even afford to save any of their money. The savings rate in the U.S. is very low, and that is why people are living the paycheck way. Even If you have credit card debt or student loans, you have to save some money. Have you heard of paying yourself first? I save automatically to my online savings ING Direct account
like if it was another bill, but is not, it’s my savings. It is kind of sweet.

5. Not Having a Budget. Make a budget if you don’t have one. The reason that most accountants and bankers have money is because they track every single penny very well with a budget. If you want to have savings and some money, you better create a budget. Not having one is a risk. It may seem like a lot work, but if you work hard for your money, you should work hard to keep it.

I always tell all my friends to save money, I know that money is important to Latinos as it is for everybody else. Avoid these mistakes and get on the right path to a good financial life.

I want to talk about how my friends always want to talk about their debt and how they wished they didn’t have it and when I tell them that I don’t have any they get all celosos.  Now below I have put a list of things that I suggest you need to do to get out of debt. I worked for me. First off, you have to keep in mind that is not going happen overnight. But, you need to start now because it takes will, it takes effort, and you have to want to get rid of debt. I know, I know, but the payoff is huge, is Grande.

1. Don’t buy any crap you don’t need.  Como on, there’s things that you want, but you don’t need them. I don’t have to tell you which ones you need and which ones you want. You know the difference.

2. Stop using your credit cards. This is a big one. If you don’t stop charging them and you only make the minimum payment you’re going to be in debt for life. So cut them up, calcel them or bury them, whatever works but don’t use them, please!

3. Negotiate your Credit Card Rate.  Call up your credit card company and ask them politely if they can lower your rate. Negotiate  so, tell them “this rate is a problem for me, what can you do to help me?” If they say, No or we can’t, don’t get mad or anything. Ask the question again, “this rate is a problem for me, what can you do to help me?” still a no. Then tell them to note in your file that you will be transferring the money out and canceling the account for sure soon. Look for some transferring deals.

4. Compare deals on cable, internet, and cell phone plans. If I suggested canceling any of this you might think I’m loco. But it’s up to you to figure out if you need cable and data plan on your cell phone. Canceling these is money in your pocket, or should I say money to pay off debt.

Check it out. This works, call up your cable provider and tell them that you’re thinking on cancelling you account because you can’t afford it. They’ll most likely give a promotional 6 mo. Deal or something. I did it and it worked.

5. Set up a budget.  After the above steps, you need to set up a budget to figure out how to distribute the money. Some Latinos friends of mine said to me that they budget in their head. And I said, you’re crazy, now you’re talking like your old school dad. Set up a budget for living expenses to just get buy and then pay your debt.

6. Make as many payments to debt as you can.  So after your bills and living budget you have to attack your credit cards or other loans heavily. Pay online, most companies let you do that. So if you pay this months’ bill on a credit card and you have more money left, sent one more payment. 2 or 3 little payments after our minimum make a difference.  My Latino mom still thinks that you have to mail a check 10 days before the due date.

7. Stick to the plan and give yourself an allowance.  It takes time to getting used to some routine so, stick to the plan and work hard at getting rid of debt. The allowance is so that you don’t get depressed or something.

I hope some of you agree with these steps to reduce debt. If you have any other ideas that have worked for you in reducing debt, tell us. 

As we all know the housing crisis began a few years ago and Latino families in America were and still are saying adios to the American dream. But, apparently more help is on the way for those familias that qualify, especially Latino families and other minorities as the political parties seek support for the elections this year.

“As Congress heads into a critical week of votes on how to relieve America’s home-foreclosure crisis, one of the toughest issues will be how to deal with the racial and ethnic dimensions of the problem.”

“The racial overtones of the foreclosure crisis are taking on a higher profile as Congress wrestles with the shape of a fix this week.”

“Black and Hispanic families have gotten a disproportionate share of subprime lending, and subprime loans are the driving force behind the foreclosures”

“4 in 10 Hispanics who got a mortgage in 2006 had a subprime loan, according to a 2007 analysis by the Center for Responsible the Lending.”

“The areas hardest hit by home-loan crisis are heavily Hispanic. In seven of the 10 metro areas with the highest foreclosure rates last month, they represent at least one-third of the population; in two of them – Merced and Salinas-Monterey, Calif. – Hispanics make up more than half of the population.”Read the story.

Gracias a dios for the elections this year as it seems like a many Hispanic homes will be saved. The aid is not only for Hispanic families, is for everybody, but since Latinos are in the group of the highest foreclosure rates, many will get some aid.

I still think that many will lose their homes regardless. This entire aid thing seems like a boost for the voting on the elections.

I was reading the paper, the wall street journal, and I saw a few articles on how inflation is increasing in the country and everything costs more and your money is worth less.

I started to think about why people are getting more into debt these days, by using their credit cards, or borrowing from their home, and even from those 401k retirement accounts to keep their life style that they have become accustomed. I just think that it is crazy that people are doing these things. I know that saving is important to get ahead. Here are 3 major reasons that I have outlined:

Uno (1). Easy Credit Accessibility. We all know how easy it is to get credit know a days. Come on even unemployed students qualify for loans. It’s quite upsetting but that’s the way it’s become. However what really makes want to vomit is the easy to get mortgage loans to people that can’t afford to pay back the loan. People who are going to try to pay it, but who will not be likely to sustain the payments of a house that are like 50% to 60 % of their take home income. Historically, in the financing industry, the rule of thumb of debt ratio on home loans is about 1/3 or about 28% of the total monthly after tax income. It the end people who are paying high mortgages cannot save. Bottom line, the more you owe the more likely you are to not have any savings.

Dos (2). Saving is Harder in This Time and Age. As inflation increases everything becomes more an more expensive, and by consequence we have less money to save because we spend more on commodities. The gas, food, and electricity have gone up and you pay(income level) has stayed the same, and for some it has gone down. So this is why is hard to save.

Tres (3). Saving sucks, I hate saving, saving is not Fun. Almost nobody likes to save today. Everybody is like “I want to live now and forget the future.” Saving for retirement means nothing to people. It’s just not fun.

Conclusion:

Things are tough now, everything is expensive because of inflation, however with sacrifices and priorities on each individual person saving can be accomplished. Saving could define your future. I think that if you want to save you must get out of debt and change your spending mentality. Please people save your money don’t spend it all.

Ok, by now you’ve probably realized that you’re spending way too much money on gasoline. I know you’re feeling it because gas has gone through the roof and you can definitely expect it to keep going up. Well, the good news is that you don’t need to switch to public transportation just yet to save money by cutting costs on gas. Hence I have put together 5 great ways for you to save gas on that you should consider.

1. Maintain your vehicle. This is key because a car that has poor maintenance will definitely perform badly.  In other words, it will consume more gas. Thus, change your filters (oil, gas, and air) spark plugs and make sure your tires aren’t rolling low on pressure.

2. Don’t Use your AC, so roll down the windows.  O.K this may sound crazy to you because in certain areas of the country is either really hot a really humid. However, sometimes you have to sacrifice in order to save. Back in earlier times when there was no air conditioning people survived, so you can too now. We have become too spoiled but the bottom line is that AC slows your engine down and it has to work more so it consumes more gas, and it is a lot more than you think.

3. Drive Intelligently.  Don’t step on the gas if you’re going on uphill road. This just sucks up too much gas, so just try to maintain an average steady speed. Don’t accelerate then brake especially if you have a heavy car.

4. Find the routes with less stop signs and lights.  It does help, it’s better to go on the expressway at a steady speed than go through streets and do the stop and go, braking and speeding.

5. Carpool.  Well you don’t have to switch to public transportation, but if you’re going to school or work find a buddy a carpool. You have no Idea how much money you can save. I did it for two years; you can cut the cost by half.

 Try out these 5 tips to reduce the gas consumption. Every little bit helps.