Beef Up your 401K or IRA Returns

2007 Facts that will Create Wealth for you!

• Proverbs 22: 7   The rich rules over the poor, And the borrower becomes the lender's slave.
  
• Foreclosure: 1. to hinder the working of; 2. to deny the right to redeem a mortgage when payments have not been made
  
• Subprime: 1. not a good choice; 2. in hindsight, a very poor choice
  
• One of the greatest times in a person's life is when preparedness and opportunity meet.
  
• Today, unfortunately, one in 16 subprime mortgage homeowners are facing foreclosure.
  

Problem: Today, there are many families who are qualified and want to buy homes, but the escalated prices keep these great Americans from buying their home.

Opportunity: Most communities have a surplus of vacant houses on the market, and many are owned by banks and other lenders.

Prepareness: Having saved money to invest in a profit and have Good Credit

Solution: Buy these houses at a discount, fix them up, and sell them below market prices.

Result: a "Win" - "Win" situation.

This morning, Terri and I viewed houses, within 8 miles of our home, with a nice realtor named Elizabeth. Elizabeth had given me a list of twenty one possibilities yesterday, and I narrowed it down to "the six". All of these are foreclosurers, owned by banks or other lenders, and have been vacant for 4 to 9 months.

• The asking prices vary from 118K to 139k
  
• I will offer 75k to 95K for each and I expect to get one or two deals.
  
• Each will require me to invest 10K to 35K for repairs to make them sparkle, like new!
  
• I will sell them for 105K to 135K, about 10K below market, to folks who want a good deal.
  
• The profit for Terri and me: estimated 15K to 20K within 4 months.

Tomorrow: How to improve your credit rating

A Housing Boom: the Opportunity to Create Fortunes

The late 1970's until 1988 was the housing boom decade.  The Vietnam war was over,  expanding families needed places to call their own, new terms like "software" & "hardware" confused almost everyone, and the economy was booming!  New housing developments popped up all over America!  

• Business people in this industry made fortunes ...
  
• Farmers (sold farm land) finally made good money ... 
• Thousands of young Americans took up the "trades" and rebuilt America ...
• Texas, Wyoming, Oklahoma, Louisiana, and Colorado:  Their oil powered American cars
• Pay increases had exceeded 9% annually, for 10 years, for most workers ...
• Students, housewives, engineers, and clerks: we all made money by investing in houses and commercial buildings ...

All was rosey!  Tax revenues to almost every government entity and school district increased and no one seemed to care.  Everyone who wanted a great paying job, could get it with an education.  

And then a few factors we overlooked for 10 years, now became common sites:  Housing sales slowed dramatically, some people were still paying 16% for mortgages, pay increases want back to 5% a year, the term "layoffs" became common, and this term became understood by the nation:

Foreclosure:   n.  to deny a person the right to redeem a mortgage due to not making payments  

Foreclose:  v.  to take away a person's house due to default by the borrower

1989.  It seems that about about one out of every 20 home owners would stop making their mortgages payment for various reasons.  Family pay increases were gone and adjustable rate mortgages were going up as scheduled.  Numerous working families purchased their homes with "no down payment", some people took out a loan for their down payment,  and many  had purchased these new, shinny houses at inflated prices and some ran to a new product called "negative amortization".  

2007:  1989 is being repeated.  With one new term:

Sub Prime:  1.  adj.   to choose a poor alternative that frequently that has undesirable consequences  2. 

What does GOD say about this?  Look at  Proverbs 22:7, "The rich rule over the poor, and the borrower is slave of the lender".

And Mr. Shakespeare said: "Neither borrower nor a lender be For loan oft loses itself and friend, And borrowing dulls the edge of husbandry." - Lord Polonius, Hamlet

I'm done!

Break Down at 30, Recovery at 50

Running has been a source of enjoyment and exercise for me since 1978.  I have enjoyed most of my running in my neighborhood.  And when not at home or on Vacations, I have run on beaches in Michigan and Oahu (Hawaii), City parks in San Antonio, the Phoenix area and Colorado Springs, and one fall weekend, the suburbs of Minneapolis.  

As I am told, the human body excretes an enzyme called in endorphins.  As I understand this process, this is a part of what allows a runner to "get their second wind" or "break through the pain" as he or she runs or races for a period of time; I have enjoyed both benefits!   

At age 29, I started to get some knee pain.  A little ache and twinge of pain became more regular as I increased my running time or started going up and down hills, inclines, and even running up four flights of stairs.   

Eric, a runner friend, told me what caused the pain; in the late 70's, he had a knee surgery performed on his right knee I saw what that did to him.  I did not want to endure that radical surgery (it was quite complicated as compared to today's micro surgery techniques), so I quit running, for 20 years.  Well, the knee pain still persisted: water skiing was also painful and even carrying a 40 load up stairs proved to be unpleasant.  

As the years went by, other things developed:

• A shortness of breath when I exerted myself
  
• Pain became a regular characteristic in my lower and mid back
  
• I developed Dunlops disease (where my belly dun lopped over my belt!)
  
• It was hard for me to perform manual labor for 12 hours without getting tired
  

About 6 years, I realized I wanted my old life back and did not want to age like this!  In this period, I visited my sister, Carolyn and her family one summer's weekend in Michigan.  She very lovingly patted my expanded stomach area and said "One too many burritos, huh Big Brother?".   Oh, was I embarrassed!  "Does anyone else see this?" I asked myself..  "Of course!" 

At the same time, I was making regular visits to my local chiropractor to help manage my back pain.  I would feel OK for a few days after a treatment, then the pain would always come back!  And he had a poster in his office that scared me: it read "When you wear out your body, where are you going to live?"    As an engineer, I knew the root cause of health decline was not being addressed; other men in my age bracket still appeared to be healthy and active; "what are they doing that I am not doing?"   20 years of pain, declining health, and searching for answers.  "The Bible" showed what I was doing wrong, particularly the Book of Daniel and the Law of Moses showed me I was not putting nutrition in my body, henceforth pain, weight problems, fatigue, poor sleep patterns, dying a little more each day, etc. became my reality!   

What people think is "food" is actually not.  It may fill our stomachs, but it is not rebuilding our bodies or giving us good health.  It may taste good, but it is somewhat toxic.  The common food that was available in most markets and most restaurants was slowly killing me.

Ultimately, I stumbled across the solution: food that restores health.  I tweaked my diet and I got good results.  The solution was quite simple and easy and enjoyable to follow.  And the cost is the same as commercial food in the grocery store.  Now, my big belly is gone, my skin smooth (no longer rough, full of wrinkles, and sag free), I sleep better, no more fatigue, and I can run again!  In fact, I can out run most males 10 years my junior; that is quite cool!   

Introduction to the World

I am Harry Otto, of San Antonio, Texas.  Some of my characteristics & attributes include: 

• Cute Wife
  
• 3 kids and 2 grandkids
  
• Healthy & Wonderful parents & in-laws
  
• Christian upbringing and values, and education and training
  
• Supportive set of 4 siblings, extended family and friends
  
• Nice home, 2 cars,  declining mortgage, and plenty of "stuff"
  
• Good Health (this blessing is from GOD, and not from my doing!)
  
• And very thankful for all of these blessings!  

Like all Boomers, I have a tendency to worry at times.  I know, it is usually a waste of time and energy, so I try to concentrate on the aforementioned blessings; then my worries seem to be less significant.  Have you ever realized that most of the items you worried about never became reality?  Christ largely insisted that we not give way to disquieting, perplexing cares  (Matthew 6:25-34).  "Which of you by worrying can add one cubit to his stature?"   

The two common worries minds of most adults are health and money matters.  

On the issue of money, my Dad taught me from an early age ... "Harry, live on 90% of what you earn".... Before Dave Ramsey, renowned financial advisor, learned from his own trials and errors and became a great resource for us Boomers, my Dad taught me how to avoid the trappings of money and pride.  Dad was a union carpenter and we 5 kids never lacked any material item.  To this day, if Mom and Dad want to take a vacation (now it is "cruising") or make a major purchase, they do it with cash; "What a concept!"  Also to my Dad's credit, all of us kids have been blessed financially; and all of us have owned businesses that have supported our families at various times in our careers.  But these business - money machines are not always beneficial to us!

I was having lunch with a good friend today.  Victor, a Boomer, born in 1946, and I have been friends for 17 great years.  He has a wonderful family, loves GOD, but he struggles with money issues.  His financial situation is similar to that of 75 to 85% of all Boomers: he is broke.   His Italian heritage gave him numerous people skills, a sense of humor, handsome children, and more, but the fortunes he has amassed have all evaporated.  Vic has been a great producer at times during the last 20 years. And when he is not producing, he is  a "dreamer" of exciting business ventures that, he admits, may have had the value of toilette  paper.  These days, I have the good fortune to share with Vic the values my Dad taught me.  He is a great friend.

And as the old proverb says, "When you don't have your health, you don't have anything."  Tomorrow I will tell you how I lost my health, then got it back.