Tuesday, August 09, 2005

Retirement funds...

I left out another important part of my retirement plan. I think this is an important part of anyone's retirement plan, and it is often talked about, but I think I will go over it again...

Roth IRA, Traditional IRA, 401Ks 403Bs, etc. These are a few of the vehicles that people use for retirement. I use all of them. I have been involved with building retirement accounts since I started working at my first real job. My folks really pushed me in that direction, and I was lucky for it. Anyone who gets pushed in this direction is lucky, and if they take heed in the advice, then they are scholarly too.

From the beginning, I have participated in traditional IRAs contributing $2000.00 per year. I have also been involved in my 401K plans. I have not been lucky enough to be part of a company that matches my participation, but that is OK. I have had the 401K money taken out before I see it in my paycheck, and I have had them take out as much as they can. For me this is generally 15%.

During my stint in the start-up world, 401Ks are not always possible. Sometimes, I have had to participate in SAR/SEP plans, other times I have not had the option available at all. While participating in the SAR/SEP, or not having any of these plans available to me, I have always managed to contribute to my IRA.

I did not take advantage of the ROTH IRA when it first came out. I should have, but hind sight is 20/20. I have started to use ROTH as of late, but at this point, I have money in both IRA options. It is really not a problem for me, but I look back now and I would have been smart to take advantage of the amnesty the government was offering back in 2000.

My wife has a pension plan with her work, and she has a 403B. This 403B plan is a civil servants equivalent of a 401K. She has worked in commercial industry and so she currently has both the 401K and the 403B. She has contributed regularly to both of these plans, and they make up a substantial portion of our networth at this point in time.

There are a few concepts that we are employing as detailed in this blog that most respectable "How to become a millionaire" plans talk about. One, we are paying ourselves first. Having the 401K and the 403B monies come out of our paycheck makes sure that these things happen. Another philosophy that we have adopted is make regular deposits. We do this with both our 401Ks as well as our IRAs. Every year in April, my wife and I trek to the bank (one of the few times I make it into the bank). These two concepts are key to achieving the networth and cashflow that we are shooting for...



Married and moving on...

While working for a start-up I got married. My life and my circumstances changed at that moment. My job had me traveling all over the world and this was not conducive to a happy marriage so I had to change positions.

I started working for a much more stable (huge lie to be found out later) company. I was to be the account manager for ONE account. It is a fairly large company here in the bay area. They were large enough to justify having their own personal account manager. While I was there I was generating about $10M per month in business. I say I was generating it, and that is really a lie too. My engineers were making it possible, I was just there delivering the goods and the good/bad news.

A sales rep who brings in $10M per month in business (again, did I mention that I had a lot of help?) is worth a lot to a company. I was paid handsomely. On top of having this job, I was consulting for my old start-up. These two jobs made me a lot of money. They allowed us to buy our house, pay for our wedding and purchase those options that I mentioned in an earlier post.

Well, the telecom industry crashed. With the telecom industry went the orders that my company was receiving from my customer. Being a good sales rep, I realized that if I was going to take credit for the sales, I needed to take credit for the crash too. Six months after I started with this company, I was out looking for a new job.

Finding a new job was pretty easy, I went back to the start-up that I never really left because I was consulting for them the entire time. I was able to negotiate a nice salary and a job that did not require me to travel as well as some more stock options. I was no longer making the money that I did when I had two jobs (about half) BUT, I was no longer trying to come up with a downpayment for a house and pay off a wedding, so the cut in pay was nothing to complain about.

Back at the start-up, which was now getting long in the tooth, being about 5 or 6 years old, I felt pretty comfortable. This was a place that I had proven myself before and the people there respected me. I was ready to settle down and watch the world unfold...unfortunately, that would not be in the cards...

Next post to follow immediately...


Thursday, July 28, 2005

Changing circumstances...

In my previous post, I mentioned that circumstances can change, and I was referring to risk taking. I am not adverse to risk as a concept, but I like to make sure it is reasonably calcuted. Those calculations change on occation though, and this should be considered.

Not long ago, a friend and I were talking about investments. He had taken $15,000.00 and turned it into $700K. He wanted to know what I would do in his shoes. He believed that he still had a sound investment strategy, but he was looking for more information and thought I might be a source.

Perspective is an important thing. My friend was looking at this as the result of his $15K investment. He was wondering what to do next. I had a very different perspective, I was looking at it as "WHAT TO DO WITH $700,000.00?" Those are really two different questions. Again, losing $15K hurts, losing $700K can change your life dramatically for the worse.

I was able to explain to my friend that I thought it might be wise to move much of the $700K into something that was almost risk-free, perhaps blue chip stocks (now my true colors start to shine as many people think...that is still risky), or evey T-bills (happy now) or something similar. I would then look to re-invest a small portion, maybe 10%, back in the original idea or something else that can generate astounding returns with tremendous risk.

When I play the pinksheet market, I do something similar to this. I invest in small enough incraments that if I lose it, it does not hurt too much, typically about $1000.00. I then watch this money move, either up or down. I have pre-set numbers that I work with with regards to return. On my pinksheet stocks I like to see at least 3x return. Once I see this, I pull out my principle AND a healthy return of doubling my money. I then watch the rest of the money (equivalent to my original investment) and decide what to do with it when the time is right. I have been rather fortunate playing this market this way. Again, it should be understood, this is a risky place to put money. I have been lucky, most people are not.

I do not know what my friend is going to do. I hope for his and his family's sake, he decides to do something not too risky with that HUGE some of money, but that is his decision now. As for me, well, you see how I do it. When the circumstances change (read: my investment becomes rather large) I change my position. It is more fun to play on the houses money...


Risks vs. Rewards

After my posting about stock options, I thought it might be interesting to cover my opinion on risk vs. reward. I believe I mentioned that I ended up buying the stock in my first start-up, not necessarily because it seemed like a good deal, but because I would kick myself if they did well, and I was not able to partake in this part of the ride.

In finance courses I took in school, the term used was Risk Adverse. The question, "How risk adverse are you?" The prof would often ask "Would you ride a motorcycle without a helmet?"...I understand the connection to risk, but not so much the connection to money. But this is something that people should think about. Therefore, anyone reading this, should have an understanding of my tolerance of risk.

The fact that I was willing to join a start-up, before they were in vogue, should give you a pretty good understanding that I consider myself invincible. I, much like most 20 something men believe that nothing can hurt me. Unlike most 20 something men, I am no longer 20 something, in fact, I am closer to 40 something, but I digress. Invincibility leads one to do stupid things such as take undue risk. I am one of these people.

Much of the money that I have made in the past has been made by taking risks that most people are too intelligent to take. Now I should temper that by adding, that intelligent is probably not the right word. What I really mean is that they can not easily find the upside, and therefore they do not bother investigating how something like this might work, and how to limit the liability.

These are things I like to do. I like to look at something and think "How can I make this work for me?" If I am flipping the channels on TV and one of Carlton Sheets informercials comes on, I will watch it. I am not planning on buying his program, but I believe there is something to it. I am sure that Mr. Sheets makes more money selling those cassettes than he does on real estate, but his ideas have some merit. I do not believe that all of these get rich quick schemes have zero basis, but I do believe that 99.9934313 people who try them will fail. That is not the risk I want to take.

No, my risks have been in the form of small amounts of money, and sweat equity. These two things do not cost me much. In order to lessen the risk to my loved ones, I continue to work at at places that can pay me a regular paycheck. That is to say, my risks are calculated. I figure out the worst thing that can happen, and I run from there.

An example, back before I got married, I started tinkering in the pinksheets. These are stocks that are traded on a little known exchange. They are typically very small companies that have very little chance of success. There are a few monsters there such as RR Donelly and Toshiba, but they are there for different reasons that the majority of the companies on "the pinks". Most companies on the pinks are there because it is a board that does not require any reporting. Companies that can not make it on the OTC, AMEX, Nasdaq, or the NYSE look to the pinksheets to generate revenue. There is a tremendous amount of risk involved in investing in these companies. One does not have much to work with...basically a website, perhaps an Investor Relations folder, and that is about it. Due to the risk, the returns CAN be very high. I followed on stock from $0.06 on up to $13.00 before I sold it on its way down at $7.00. A huge return by any standards. That stock is once again trading at $0.06 by the way.

Anyway, the point is, this is a very risky platform. In order to mitigate the amount of risk that I have to endure, I only invest a limited amount of money. I invest $1000.00 or less. If everything goes to hell in a hand basket, I have only lost $1000.00. While that hurts, it is not going to prevent anyone in my household from eating.

If I were to invest more money, say $50,000.00, and I were to lose it, again, probably everyone would eat, but everyone would be me as my wife would mostlikely take my son and go some place SANE. That is more risk that I want to take.

So, my point being, I am happy to embrace risk under the right circumstances. Those circumstances have a habit of changing though, and it is good to have an exist plan...


Tuesday, July 26, 2005

Start-up happy (and option primer)...

I have worked for a number of start-ups. I cannot recommend them enough...if you are young, single and looking for excitement. I am no longer that way (really, I think I strike out on all three counts these days). A start-up is a great place to grow, and possibly hit a financial home run.

When I left my first start-up in the end of 2000 (shortly after I got married) I was given three months to purchase the shares that had vested. For those of you who do not understand the shares process, I shall try to clarify it here.

Often times, in order to entice potential employees to join a company, that company may offer stock options. Stock options grant the holder the right to purchase stock at a future date for a price that is determined by the board of directors of the company. This "strike price" is suppose to accurately reflect the current value of the company's stocks. The idea is that the company will grow, and therefore the value of the stock will grow too. Your option contract is a contract to purchase stock at the "Strike price" for a given period of time no matter what the actual price of the stock may be in the future. So if the price does go up, then you can "exercise the options" (buy the stocks) at the price on the option contract and sell them at the current price. The difference is your profit.

An example would be starting with a company and they offer 2500 options based on the board of directors approval. The options may not be priced yet because the board has not voted on approving them yet. If the potential employee accepts the position, and becomes an employee, the board will meet and set a price for the options. Again, this price should accurately reflect the current value of the company, but this is often times difficult to figure out. This price sticks with the options for the duration of the contract, generally 10 years, or within some period of time after the employee leaves the company, which ever comes first.

If the start-up is lucky enough to "go public" and is allowed to list their company on one of the exchanges, the shares become much more liquid. While it is possible to exchange shares of a non-publicly traded company, it is not easy. Once the shares are listed, the marketplace then dictates the fair market value of the company. If all goes well, this price is higher than your strike price.

When you want to capitalize on your gains, the difference between your strike price and the share price, you simply purchase your options, and sell the shares. This can often times be done in the same transaction.

Vesting is an important part of the puzzle. I have not included that yet. Typically, when options are granted, there is a vesting period. A options contracts usually lays out a time frame for the options to become viable to be purchased. The length of time varies, but in the Silicon Valley, I have typically seen a 4 year vesting period.

In general, for the first 364 days, not one share vests. This means that if you leave the company before a year, you can not take advantage of the options that were offered to you. On the 365 day, or after one year a large percentage will vest, in my case it has always been 25%. Over the next 36 months shares continue to vest at the end of every month, typically at a rate of 1/48 of the total options offered. If you leave before all of the shares are vested, the company will use a formula similar to this to figure out the number of options that have vested.

Smart companies will continue to offer options throughout the employees career. By doing this, the employee has added incentive to stay with the company because more shares are vesting all of the time.

back to my story...

I had three months after I left the start-up to purchase my options. The company's stock had a 2:1 forward split since I started and was granted the options. This stock split meant that every stock or option to buy a stock had doubled in number, but the price was cut in half, thereby leaving the value intact. Twice as many, each one at half the price.

I did end up purchasing my options, and turning them into shares. Of course, these were shares of a company that was not publicly traded, so they were really virtually worthless. But, I had faith that this company would someday make it. They had good technology and they had a market, I just needed to sit and wait.

When all was said and done, I ended up with 30,000 shares (total number vested leaving about 40,000 on the table unvested), and each one cost me about $0.15. This was a total outlay of $4500.00. At the time, I was sure that it was a good move. As time progressed, I was not so certain...

Stick with me as I continue to outline my financial successes and failures and see what happens to this company, my stocks value and how it helped or hindered my progress.

Until next time,


Monday, July 25, 2005

Your home...

It is estimated somewhere, by someone, that the average person stays in their first home something like 7 years. My wife and I have been in our house for almost 5 years now, and she is ready to move. I thought this might be a place that we would stay for a long time. I think I was mistaken. I do believe that we will own it for a long time though. The plan was always to own the home and pass it on to our children as a revenue generator, if not a home.

Early, I discussed buying a home, and buying a house. I differentiated between the two as one is a place for you to live, the other is a place for someone else to live. My belief is that the home should be bought to fulfill non-financial needs first, and then be considered an investment. The house on the other hand, purely an investment.

I would like to review the investment side of this piece, and it fits for both types of properties discussed, houses and homes. One of the points that is talked about in real estate discussions that is often times over looked when comparing real estate to other investments is the process of leveraging. Leverage takes place in many forms, but it is the rule in real estate, and it is the exception in many other forms of investment.

Before we get too far along in this, let's look at an investment example. Let's say someone has $40,000.00 to invest. On average, the stock market climbs at almost 12% per year. Similar returns can be said for California real estate. If this is the case, what should the novice investor do? In the long run, it is likely that an investment in real estate will prove to be a better investment. The reason is leverage. If one were to take their $40K and put it into company ABC which happened to return 12% over the next year, at the end of the first year, their $40K would have grown to $44800.00, an increase of $4800.00. Not many people would complain about that. But, if that $40K had been put into a house, with a standard down payment and a 12% return, after one year, that 40K would have turned into $64K! Why the big difference? Leverage.

Leverage is the art of using someone else's money. When you buy a home, you usually assume a mortgage from a bank. The bank loans you money to buy the house. Therefore, you use the 40K for a 20% down payment on the home, and you borrow 80% from the bank, or $160K to purchase a $200K house. The entire house price appreciates over the 12 months, but the bank does not expect to see that money, they only want you to pay them their principle along with the interest that you worked out.

There are two points that should be made at this time, one, you do have to pay the bank back, and two, one can leverage stocks as well. Let me take some time to expand upon both of these points.

One, paying the bank back. Yes, the bank loaned you the $160K in this example. It did not give it to you, so it must be paid back. Therefore, the $40K you invested is not the end of this investment, there is an ongoing maintenance that must occur. But guess what, that ongoing maintenance is something that you might currently be consider as rent! When you purchase a home, you no longer need to pay rent. Therefore, the money that was going for rent may very well cover the payments needed to cover the mortgage. Today things are a little screwy. In many parts of the country, rent is significantly lower than a mortgage payment and therefore this needs to be taken into consideration when looking at real estate as an investment.

Two, leverage and buying stocks. As I mentioned the beauty of buying real estate as an investment is leverage, but in all honesty, one can also use leverage to buy stocks. Using leverage to buy stocks is different though than using leverage to buy real estate for a few reasons.

1. Stocks move up and down much quicker than real estate. Buying and selling stocks can happen without much pain or intervention, where buying and selling real estate generally takes time. This makes stocks much more liquid and therefore allows the price to be more volatile.

2. Margin calls occur when the price of a stock drops beyond the comfort zone of the bank that lent you the money to buy a stock. In the stock market, the information is almost perfect. It is easy to tell the price of a given stock at a given time. If the company that lent you money to buy a stock sees that the price is going down they may want to make sure that you do not stick them with the loss by walking away. They will call you up and demand that you cover the drop in price. In contrast, banks do not do this. The bank assumes that a house is a long term investment and they believe that you will own it through may peaks and valleys and they are OK with fluctuation in the price as long as you keep up the maintenance of the loan.

Using leverage to play the stock market is generally something that is done by very seasoned investors, or novices who do not know any better. Leverage in the stock market can quickly change ones financial fortunes, but if you do not have the financial wherewithal to handle the margin call (which can be substantial) generally it changes financial fortunes to financial misfortunes.

With all of that said, one can see that I am big on investing in real estate. I am not about to jump into the bubble argument (at least not in this particular post) but I will say that if one is looking at buying a home, for the right reasons, then I believe it is a good investment, if only for the piece of mind that it offers. I am a firm believer in enjoying your home for its hominess, and if you do eventually move out, then I hope you can enjoy it for its houseness.

Until I get the urge to pen again,


Monday, July 18, 2005

Buying a house...

I look at an investment property very differently than I look at the place where I live. I live somewhere near where my wife and I work. I live in an area that has great parks for my kids, is close to my parents and in-laws, and allows me to be me. It has the requisite number of bedrooms and bathrooms, it has room for our pets etc. It is not a house, it is MY HOME, my castle.

A house on the other hand is someone else's home. It does not have to meet my specifications, and it is probably better if it does not. It should meet someone else's specifications though, a place where they may want to hang their hat.

I view investment property as a way to make money. This money can be made through cash flow, equity, or if one is lucky, both. In my mind, the best way to increase your chances of making money in any of the aforementioned areas is to make sure that this house appeals to a wide variety of people. The more people who are interested in this property the better your chances of making money.

Another way to better ones odds of making money on a real estate investment is buy low. This can be accomplished a few ways. One can get lucky and find a buyer that does not know what he has and therefore sells it for cheap. One can buy into a rising market. One can purchase property that is distressed and likely to be foreclosed upon. One way that I have made money in the past is buying properties off plan.

Buying properties off plan mean purchasing the property before it is built directly from the developer. Buying property this way means that you pay a standard developer mark-up, but you do not pay the "market price" which is determined by what the market will bare. In buying off-plan, you are betting that the developer has done his homework, and knows where and what to build.

Buying property below its market value greatly increases your ability to rent the property out at a rate that may cover the expenses of holding the real-estate. While the mortgage is the main piece of the equation that needs to be considered, there are other expenses that one must factor in. There are property taxes, home owner insurance, association fees, and maintainence just to name a few. If a property is purchased below market value, the chances that rent will cover these costs increase.

Buying property below market also means that you have already built in equity. Of course that equity is generally only realized when the house is sold, but none-the-less, equity is important, and it will increase your networth.

This post is long enough for now. I will write more on this subject as time permits, or as I come back to this topic in my investing ways (which will happen a few more times at least).



Buying a home...

This topic has been covered by everyone, or has it? When purchasing a home, there are certain things that I believe need to be considered, and I do not believe that many authors cover all of these topics in one spot. So, here for my own pleasure (since this site is not to be construde as advice) is what I think to be important when I purchase a home (and I have purchased one or two...)

Am I going to be living in this home? If so, then I do not believe it is a financial investment. If I am living in it, then it is an investment in my piece of mind/mental well-being. That being the case, then there are certain things that I am looking for from MY house. I want X, Y, and Z. Someone else's wants will certainly be different than mine and that is fine because I am planning on living here. Some of the considerations that I believe are important are:
  1. Size of the house and lay-out. I believe a house should have 4 bedrooms for my needs. I am sure many people can get away with fewer, and there are certainly those who need more.
  2. The yard is also important. I want one. It does not have to be huge, but bigger is better to a point. My current lot has about 6300 square feet, I would prefer something about twice that size. Anything more than a acre seems like a lot of yardwork to me (one acre is about 40,000 square feet).
  3. Location, Location, Location...That is the real estate agents mantra. I believe that location is very important. In reality, I would consider this to be of the utmost importance in selecting a home too. You need to feel safe and your school/work/shopping habits all need to be met easily. This is your home, you should enjoy living there.

There are other items that I take into consideration, but I cannot think of them now, but this is a good start on my list. Anyway, the point behind buying a home is to by something that you can enjoy and that your family can enjoy. It is not a house that you are buying, it is a home. It is part of your daily life.

If you stay in your home for a long enough period of time, then it will most-likely prove to be a very wise financial decision as well. The finanical piece of this puzzle is not a good reason to buy a home though, that part of the puzzle is reserved for buying a house.

Best Regards,


Important step in my journey

There is a very important step in this journey that I almost left out. It is funny, this is really supposed to be almost a step by step of how I got to where I am at, and I almost left out the first real step in the process. Without these parts, this would really be just about my ego. Well, I did not forget, and here it is...My wife and I bought a house. I briefly touched on this in the previous post, but it is a very important step, and it needs to be covered in some detail.

Before people start telling me what a bad idea it is to buy a house in this market (and remember, I am in the bay area, Original Home of the over priced house) this was a very important step. I can tell you that we thought we were buying at the peak. This was the end of 2000 and everyone had been speculating that there was a real estate bubble and it was going to pop even back then. To be honest, I believed it. There are reasons for doing what we did though...

I had a professor in college who emphasized home ownership in one of his classes (he was a finance teacher). He had over 100 properties (both commercial and residential) around town and he did not need to work. This impressed me then (and it still does today) and I decided that I was going to own some properties. My home was going to be one of them.

My professor was emphatic about buying as much home as your could afford. Historically, the numbers point to CA property rising at 10-12% he would tell us. If you buy the most expensive house you can afford now, it will hurt for a few years, but then with pay increases, you will be able to afford it easily, and you will being growing your networth at 10-12% of a higher number. Theoretically, it makes perfect sense...

These were slightly strange times though, I was making too much money. I knew that, and I did not believe it would last. I had talked to some lenders and they were all willing to lend me a lot of money...more than my wife and I were comfortable borrowing. We ended up scaling back about 20-25 percent so the loan we ended up getting was almost 80% of what the banks were willing to lend us with a small down payment.

Getting the loan was a pain. I am not sure why it was so difficult, but it was. Actually, all of the loans I have gotten to date have been painful in one way or another. I will talk more about these later, but to emphasis, getting this loan was difficult.

Before we get into the loan, let's cover the house/house hunt itself. My wife and I had decided on a few neighborhoods that we wanted to live in but only one of them was really financially feasible at the pricing target we had set. After picking this neighborhood, we started to scour the internet and to drive through looking for homes. We had not contacted a real estate agent at this point in time. We were just checking things out. It was a casual affair, until I called the bank to get our pre-approval.

I believe it was within a week of getting this piece of paper that we made our first offer. We were on a mission from that point on. We were checking out houses with a vengeance (still without the aid of an agent) and getting excited about homes that were not right for us at all. We were about to make a big mistake. Luckily, we had our folks (both sets) around who were able to keep us reasonably level headed (Do you really want to spend this much money on a house only to have to basically gut the entire thing and start over? Also, what about that dungeon/wine cellar in the garage...that is scary).

EVENTUALLY we ended up purchasing a place (actually the first one we made our offer on). I would not recommend doing this the way that we did, but it worked out OK for us. We still had not enlisted the help of an agent, but we saw a sign on a house that we liked so we called the number. The agent let us into the house and we liked what we saw. We explained to the agent that we did not have an agent of our own to write up the paperwork and he offered to take care of it.

(Looking back now, it was a bad idea for us to use their agent. He has conflicting interests. he is being paid by the seller and therefore should be working with the seller to get the highest price. While an agent that we would hire would also be paid by the seller, his interest should be in making us happy, not the seller. I will say that though the negotiations, it ended up working well for us because there was another offer on the table, at the same price. Our agent ended up giving up some of his fee (as he was receiving both buying and selling commissions) to make sure we ended up with the deal. Again though, this is not the way I would recommend doing this. Every other house we have purchased, we have used our own agent.)

Well, we bought at what was thought to be the peak of the market. It was December of 2000. We were OK with that though. We had a house that we could afford, and if the prices did drop, we would still be able to make the payments. We purchased a house first, and an investment second. It was this concept that allowed us to make this purchase. If we had thought about it as an investment first, we would still not be home owners today.

As it turned out, December of 2000 was not the peak of the market. I am not sure we have seen that yet. Due to the fact that we bought the house as a home though, we are not too worried about it. A nice bonus though is that our place has appreciated about 50% since we bought it. This tied in with our down payment, and some extra payments along the way, and we have about $375K in home equity. Not a bad start to hitting my financial goals...

Friday, July 15, 2005

A bumpy road...

I was moving almost $10M per month of product. Any sales person would have to admit, that is a lot of product, even if you are moving (insert your own rediculously expensive item here). Anyway, it appeared as though I was set. Nothing could knock me off course now except a possible total colapse of the industry...

In April I was laid-off. Sales in my area had gone from $10M per month to just over $1M per month. I was equally responsible for both figures. With my territory only pulling in just over $1M per month, it was easily rolled into another territory, and this was happening a lot. Our company was 600 people strong when I joined, when I was let go it was down to 300, and it finally shrank to about 100 people before it was bought.

Luckily for me, I had kept consulting with my previous company. I called them to inform them that I was going to start looking for a new job. They invited me to come back to them full-time and assured me I would not have to travel. Sounded like a good idea to me, so I did it.

Going back to your old company is not something to be taken lightly. I wish I had known that then. I had warned people about this move. I told them that doing so put your previous employer in a very powerful spot. You were almost admitting that you needed them. I should have heeded my own advice...

Less than a year after going back to work for at this company, I had to leave. It was not for any of the reasons I thought I might have to, but the fact of the matter remained, I had to leave. I had a long chat with the CEO before I left. He reminded me that I had always wanted to start my own business, and this might be a good time to do so.

Starting your own business, like buying a car, is TOO easy. I was not aware of the hurdles that I would eventually face (eventually was not that far off). With a few minutes on the Internet, a couple phone calls, and sometime spent trying to come up with a company name I was in business!

Just what kind of business, and why that business, you will have to stick around for my next post to find out. Until then, have a great day...



Thursday, July 14, 2005

Yet Another milestone...

I had been working at this start-up company for a number of years. Things were going well. I was making good money (better than I would have been at my old job) and I was getting to travel the world. Unfortunately, still no signs of my company going public...

Other parts of my life were going well too, specifically my love life. In fact, it was at this point in my life that I was contemplating getting married. Luckily for me, my girlfriend at the time was thinking along similar lines. We got married later that year.

Getting married can be expensive. We decided that we wanted to pay for everything ourselves. This ended up being a good idea because we did irritate our parents. This was not intentional, and was really the fault of the facility where we had the ceremony. The fact remains, my folks were not happy. Anyway, the tab came to just shy of $20K, with the honeymoon, we were around $25K I believe. Guess what...I was back in debt AGAIN! (the ring was already paid for, AND now it was really WE were in debt)

After getting married my wife let me know that my constant traveling was bothersome. Actually, I had to agree. Traveling for business is really awful. Anyone who has done it understands, and those of you who have not, consider yourselves lucky. It is not as glamorous as you believe, even if you do not think it is glamorous. Luckily, there was a technology boom afoot and I was there to catch a ride, even if it was only for the tail end...

A few posts ago I mentioned that I was going to get out of debt by getting a new job. It worked back then, and I was able to make it happen again (It helps that I never seem to quite the first job before starting the second one). I took a straight sales position with a new company (that did not require travel) and I kept on at the old company as a consultant. Between the two job I was making A LOT of money. Within a very short time, my wife and I had paid off the newly acquired debt, put a down payment on a house in the San Jose and purchased the stock options I had in the start-up mentioned at the beginning of this post. Things seemed to be going well.

My work life was about to become very tumultuous...It was 2001 and I was in high-tech. Luckily, I had started saving...

Until next time,