Did I get your attention with that bold statement? Thought so. I figure, this is the first post of many so we might as well define what this blog is all about. Let's leave the confusion at the door. I think part of the problem we're facing right now is that most Americans have no idea what they're doing with their money. We are bombarded daily with images, articles, news reports, blogs, videos, and breaking news feeds with all sorts of mixed messages. My theory is that all these media impressions are purposely designed to be confusing so that you just throw your hands up and say something to the effect of, "Why don't I just give my hard earned money to this financial institution to manage for me because I have no idea what I'm doing?" or even worse, "I can't deal with this mess right now, we'll just start investing later, 5 years from now, or 'someday'." As Tony Robbins says, "The road to someday leads to a town called Nowhere!" Unfortunately, due to the economic crisis we're living in, that town will be filled to capacity and will have a lot of occupants who chased the hottest investment ideas, the next big thing, easy money, quick flip properties, penny stocks and the like. My goal for you would be to take the exit before "nowhere" and live a life of abundance (which doesn't always have to mean financial abundance). Success is the stuff left over when the money runs out.

Here's where we begin. Let's get a few of the basics on the table. If you take a deep breath and open up to the fact that with time and some educated investments, you will retire in style and live a life that's a little less confusing. Start with the title of this post. Your primary residence is NOT an asset. The definition of an asset is something that puts money IN your pocket. By definition, the house you live in does not put money in your pocket, in fact it takes money out of your pocket every month for 15 to 30 years typically. Even if it's paid for, you still have to pay taxes and insurance and possibly a homeowner's association fee. The confusion that we've encountered this past decade is that homeowners have been able to pull money out of their primary residence and use it to buy lavish gifts, vacations, home improvements and other rental property. The problem with this is that over the course of 10 years, the first time homebuyers got used to hearing the stories of these kinds of financial winnings and have come to expect the same. Buyers would constantly rationalize their purchase as an "investment" because it's just supposed to appreciate. Never before was appreciation really the incentive to buying a primary residence. Some markets in this country and other parts of the world would appreciate at alarming rates and owners got very excited about what they could buy with the "equity" in their home. In reality, a home is no different than a car except for the cost and the financing terms. A home is supposed to last 30 years thus a mortgage is typically 30 years, while cars unfortunately tend to last 5-7 years thus financing is the same. A car was always looked at as a bad investment because it went down in value as soon as it was driven off the lot, but a home was looked at differently for some reason. A home was just supposed to go up in value and as soon as that proved not to be true starting around the end of 2006 panic starting setting in. . . (to be continued)