According to Wikipedia, courage can be defined as: The quality of a confident character not to be afraid or intimidated easily but without being incautious or inconsiderate. I’d say that being confident about many aspects of your personal finance can bring you to another level. However, one must not let down their guard and remember to continue being cautious, considerate and to remain humble  ;-)

Be courageous enough to pay off your debt

Paying off your debt ahead of schedule requires other sacrifices. One must be brave enough to live you can afford not the same lifestyle of the Jones (richer or less courageous neighbors)  next door. It is hard to give up the vacation down south for 2 weeks a year instead paying off your debts. However, if you can master your envy and enjoy life, you will be in a much better financial position in a few years!

Be courageous enough to ask for a promotion

I had recently mentioned how I got 3 raises in the span of 12 months and how I positioned myself to get another 2 raises this year. While I did an analogy with poker, I could have also mentioned that it requires guts to ask for raises and promotions during tough economic times. However, if you are not the one who is asking for more, you can be sure that someone else will take his share of the pie (and probably yours at the same time!). Money doesn’t come  simply because you come into the office at 8 am and work hard.  Sometimes, you have to shake the trees to get the fruit!

Be courageous enough to take risk

As the definition of courage mentions, one must be brave and confident enough to do things others don’t without taking stupid risks. During the past 5 years, I have taken my share of risks (I quit my job, borrowed money to invest, borrowed money to buy the house I wanted, borrowed money to start a company, etc). I can basically say that I am where I am because of my tendency to use other people’s money. Being more conservative would have seriously reduced my level of financial stress but I would not be living in a great house and making a 6 figure income today. It is all part of taking risks and calculating the rewards attached to them. I do not always calculate the risks of my actions (I still think that if I have to go bankrupt, I need to do it in my 20s!) but I certainly always calculate the potential rewards attached to the risk I am taking.

Be courageous enough to believe in yourself

This leads me to my final point: believe in yourself; in your abilities, in your talent. We all have great potential in something, we just have to be quick enough to find it and improve our life with it! If you believe you can increase your net worth, get a promotion, pay off your debts or start a company, then do it!

My own definition of courage

In light of this article, being courageous is not only to become confident without being careless. Being courageous means being able to leave one’s comfort zone to face the living chaos of life in order to be able to improve your own life.

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I recently ran into Budgets Are Sexy’s millionaire’s club. Actually, this is not about real millionaires… it is more like millionaire wannabees I am usually not a wannabe, but I definitely could get my head around being part of the gang of rich people! This is why I have decided to join their ranks and share my plan to become a millionaire.

I actually talked about a few ideas in the past and my plan is giving me the opportunity to reach the million dollar mark by the age of 45 (or so ). However, the reason I created an online company with my best friend is definitely to cut this objective down to 35 years old. How I am going to do it you ask? Here’s my list of prerequisite to reach millionaire status and to reach it by 45 (I’ll talk about how I can accelerate the process cutting out 10 yrs later on ):

#1 Maximize my RRSP every year (which is about 6K per year since I have a decent pension plan). This should give me 213K at the age of 45 (at a rate of 7%, since I am 100% in stocks, I should be able to reach it!). Since I don’t have much time to do stock picking right now, I am using index mutual funds that replicate perfectly the Canadian, American and International markets.

#2 Keep my house. The value is now at 325K, at 3%, it will be worth 537K… not too bad If I was ever to switch houses, I would need to keep the same value (or more) to make sure to reach the million dollar mark by 45.

#3 keep working on my online company (my share should grow at a minimum rate of 10% for the next 17 years). This is a very fair assumption as it is growing at a much faster rate right now (like more than 100%!). This would give me an additional 151k (now worth 30K). This is probably the part of my plan that will require reassessment on a yearly basis to know how good (or how bad!) and I am doing with it. We will surely hit an income ceiling at one point since we are quite limited in the time we able to invest in it. At that time, some real questions will have to be answered; do we keep doing it “for fun” or do we want to create a full time company with it?

#4 Keep my pension plan. This is very hard to put a value on. However, at the age of 45, it would include 22 years of contributions. At full retirement, it will give me 70% of my base salary. Hence I figure that my pension plan will be worth at least 200K at the age of 45.

#5 Pay off my debts! If I am able to pay off 150K in debt over the next 17 years, I will be able to drop my debt to 100K. Since my first plan to become a millionaire, I have quit my Smith Manoeuvre strategy in order to shift my investments into my online company. I have also temporarily cancelled my systematic investment plan since we are now living on a single income. I prefer to concentrate on paying down my debts since my family is depending on my capacity to earn enough income from year to year.

This would put me at about 1M$ by the age of 45. While a million dollars is a lot of money, this won’t mean as much in 17 years… This is a bit disappointing when you think about it!

This is why I  must find a way to put more fuel on the fire and make it happen at the age of 35! While reaching a million dollar net worth at the age of 45 seems virtually feasible (without much effort), becoming a millionaire by 35 will require a lot more effort and I will have to take much more risk…. Oh well, it doesn’t sound like I am afraid of it anyway! How am I going to do it?… nah… not in this post folks…

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I have immersed myself deep in thought about personal finance this week After reviewing my 2009 goals and looking at my net worth, it is now the time to set my goals for 2010.

I was pleasantly surprised how the additional motivation, “read pressure” due to the fact that I wrote my goals on my blog pushed me to keep them in my mind all year long. This was definitely a key point of my success. This is why I am repeating the experience again for next year. So here are my financial goals for 2010:

#1 Paying off the loan from my parents

Last year, I wanted to have my wife stay home and take care of our family. This year, my main goal is to reimburse my parents in full on November 1^st 2010. This will be a crazy challenge as I will owe them $31,000 and I am far from having it right now!

I plan to be able to gather about 10K from my savings and I’ll probably be able to pull out another 20K from the equity in my property. So technically, I should be fine. However, I would prefer to avoid borrowing any more on my property (this would only transfer the debt from one place to another, remember the story about Peter and Paul). Since this doesn’t sound like a genuine plan to me, I will be concentrating on other financial goals to increase the amount I can accumulate.

#2 Increase my base income by at least 15%

There are a few windows of opportunities in my industry where I could jump my base income without affecting my possibility of getting a big bonus next year.

There are bigger books and higher salaries given to those who handle them. My goal will be to take over one of those “big books” and increase my base income considerably.

This opportunity won’t happen many times in my career and right now, I’m like a free agent that just racked up 50 goals in my latest season. While I don’t really feel like changing desks right away, I think I have the best opportunity to do so right now.

#3 Increase my online income by 50%

Last year, I wanted to double the income from my online company. We did way more than double the income and I am very happy about it.

I still want to increase my online income to new summits. However, after 2 years, I know that doubling my income within 12 months will be really tough. I still aim high with a 50% increase.

We will probably spend the first half of the year reimbursing a part of the company debts (related to the acquisition of Gather Little By Little). Then, we will probably have enough room on the line of credit to look for another buying opportunity

Growth by acquisition, this is probably the fastest track to increase our income by 50%!

#4 Finishing in the top 10 financial planners in Montreal again

Being part of the top financial planners in Montreal brought me several benefits;

#1 I got a huge bonus so my wife can stay home.

#2 I have the chance to switch for a bigger book of clients (and a bigger income too!)

#3 I have full flexibility with regards to my work schedule and nobody looks over my shoulder to see what I am doing.

I definitely want to keep a good track record as a financial planner as I really appreciate my wife staying at home right now. This will most likely be an ongoing annual goal as long as I stay at the bank!

So then again, 3 of my 4 goals will help me realizing my main goal for 2010: reimbursing my parents. I have figured that if I can switch to a bigger book and get a similar bonus, I won’t have to take money from my house nor my company to pay them back. This is the kind of scenario I can be proud of!

So another great year with great challenges to come ahead!

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Whoa! We are already approaching year’s end! While we are all stuck with Christmas shopping lists (my hunt is almost over, yippee!), I will stop for a moment and take a look back at my financial year 2009. I must admit that I started 2009 with great ambitions and thought that if I could achievet 2 of my 4 financial goals, I would be in a much better position. So let’s look at my financial goals and what happened to them:

Make the top 10 financial planners in Montreal

This was a huge step to achieve as we are almost 100 financial planners on the island. I still don’t have the final ranking but as of September 30^th (our financial year ends on Oct 31^st) I was 6^th in Montreal and 18^th in the entire province (out of 280 financial planners).

This resulted in an invitation to a special evening (that is tonight actually!). Since I had an amazing month of October, I know that the worst case scenario is that I will keep my 6^th position in Montreal. Making the top 10 was not only good for my self esteem, it was good for my wallet too! In addition to that, it’s like being a free agent in the NHL with a 45 goal season. Every single branch manager in Downtown Montreal is trying to find a way to offer me a better position. I guess I should be able to get another raise during the year

Double the income from my online company

This was probably the easiest of my four goals as internet growth is exponential. So it is without surprise that I have more than doubled our online income. This obviously passed through the purchase of Gather Little by Little which has become an important pillar of our online company.

Most importantly, we have diversified our sources of income among many sites and different ways to make money online. This was a key point of 2009 to make sure that we will continue to grow a healthy and sustainable business (and income! Hahaha!).

Finish my MBA with honours

While I didn’t receive my real diploma yet, I have received my certificate “MBA with Honours” a few weeks ago. In order to get it, a GPA over 4.0 and finishing in the top 5% of the class was required. Funny enough, I have a 4.0 even GPA

I thought I would have been happier to get that piece of paper but it feels more like a relief than a feeling of fulfillment;-) Nonetheless, I am happy to have it completed with honours so I can add it to my resume and I know that managers like this a lot hahaha! The things you do to look good sometimes… aaahh…..

Get my wife to (finally) stay home

I must admit that considering our financial situation, we kind of pushed the envelope with this one a little bit. We couldn’t really afford for my wife to stop working right away but life being what it is, sometimes you have to take decisions that are beyond the rational and financial scope of our minds.

I don’t regret it as our lifestyle changed drastically to become smoother and we have much more time to relax and enjoy ourselves. However, I definitely need to finish among the top 10 financial planners next year too if I want to keep this dream alive!

What I am going to do next…

I already have a few ideas for my 2010 goals but I won’t disclose them right away. I want to take a some time to reflect on them. Financial goals are more than numbers and a list of achievements. It has to have significance in one’s life if you really want to put in the effort that’s required in order to be successful.

Well, it had cost me the very few hairs I had left standing on my head (yup, I’m 28 and almost bald… crazy isn’t?) but I’ve made it! Now it’s time to think about 2010, to Infinity and Beyond!!!

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On Monday, I was explaining a bit where I stand with my single income family situation. We basically chose this route in order to reduce our stress and thereby to improve our quality of life. We surely won’t be able to have 2 cars in the driveway or go to Club Med with our children annually. However, it doesn’t mean that we will need to skip meals either! This is what I want to talk about today; the pros and cons of having a single income household.

What sucks about a single income household:

- You obviously endure more pressure to perform at work. This year, I have earned an amazing bonus because I was a top financial planner in my area. However, I must continue to be a top gun next year as well to reach 6 figures again.

- You have to make financial decisions, read “sacrifices” such as trimming discretionary expenses such as cars (ok, we just bought a new one, but it comes down to a similar cost as having 2 old cars!) and vacations (we can’t afford Disneyland, but we can rent a vacation property for a week).

- We think twice before spending money. While we can afford this lifestyle, we have decided to take a cut in our income early in life (we are not even 30). Therefore, we still have a big mortgage and a car loan to pay. If interest rates were to rise drastically, chances are that my wife would have to go back to work. 8-(

What is cool about a single income household:¸

- Since my wife has enough time to take care of the house during the week, we spend our weekends together as a family with great activities.  We are not “too tired” to play with our children.

- I have never felt so close to my children! When I arrive home after work, I don’t have to rush into making supper (it already smells good in the house when I open the door ). So I play with them and we can sit down to dinner together and have a “chit-chat” about everyone’s day and whatever is important that day.

- My wife and I are less stressed about “all the little things” that need to be done at home. We are actuallyahead on our Christmas shopping! (Can you believe that…)

- I actually work less too! No more household chores to complete over the weekend and working for my online company feels like pure pleasure (it is like that because it’s only once a week and I look forward to it, as opposed to feeling like work because you have to do it every day!).

So I am not saying that having a stay at home mom is the perfect situation… yet, come to think of it, it’s pretty darn close to it

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