James & I were fortunate enough to listen to James’ grandparents tell all sorts of stories about their lives. Along with 56 years of marriage, they have also been fortunate with their investments. James’ Grandpa Miller began his life in the middle of the great depression and had no shoes for 4-6 months a year. He only got one pair a year, and they either wore out or he grew out of them before the next time to buy shoes.

Grandpa Miller has been investing in stocks for fifty years now, and had a few rules that he sticks to:

1) He likes picking individual stocks, and isn’t a fan of mutual funds. He feels more confidence in knowing the details of the one stock that he picks.

2) He subscribes to Investor’s Business Daily and watches their top 100 picks. He likes to check out those at the bottom of the list with a good price to earnings ratio and invest in those. Considering that our big pick is now at #1 in the IBD ratings, I tend to like this tip quite a bit.

3) He sells if the stock drops below around 15%. This was also a tip that James’ dad recently offered as some of the best advice he has received for managing investments.

4) The Millers have also been involved with investment rental endeavors throughout much of their adult lives. While not as much is gained in the day to day cash flow, they have done very well with appreciation of their various properties.

5) The Millers have also saved up and purchased all of their cars with cash. This has enabled them not to pay interest on monthly car payments . Instead they act as if they have car payments, putting away whatever is seen as necessary for the next car that would need to purchase. By doing this, they gain interest every month rather than give it to someone else.

6) Grandpa Miller also contributes his successes to having a great wife to take care of the children and being a partner in reaching their goals.

7) Last but not least, the Millers are known for their frugality and living within their means. This certainly comes from growing up in the great depression, but it means they are now secure in their retirement.

We were happy to learn a few tips from the Millers and will certainly keep these in mind with our own financial planning.

Best Wishes,

Miel

MANAGE YOUR MONEY TOGETHER

Here are some simple guidelines for DINKS to build wealth:

1) Collaborate: Meet regularly to talk about money, set goals together, track and monitor them.

2) Understand and respect your partner. Take time to understand your partners values about money.

3) Watch the numbers. Get a budget, monitor your spending and track your net worth.

4) Max your retirement. Maximize contributions to your tax deferred retirement accounts.

5) Invest in stock. Stocks perform better than bonds or cash.

6) Avoid high interest debt. Credit cards and title loans are financial cancer.

7) Diversify. Don't put all your eggs in one basket.

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