Chartered Financial Analyst (CFA) Level 1 Candidate
May 1st, 2011 § 2 Comments
I graduated college in June 2010 and started my first job as a consulting analyst a month after. I really enjoy the work that I do and find it very stimulating. I have learned a great deal about project management, delivery of complex technology solutions, budgeting, client relationships, among others. I greatly appreciate the skills that I have gained and always look forward to continue developing my leadership & communication skills in general.
However, there is one thing I have a very keen interest in that I do not get exposed to in my job, investing. I am extremely interested in learning more about how to analyze and evaluate the different investment opportunities out there, and how to optimize returns. As I have mentioned before, I am fascinated with the topic of passive income, and more importantly, increasing my own personal wealth and that one of those around me. Because I have this keen interest in finance and investing that is not being fulfilled by my job, I was pursuing it as a hobby during my spare time. Recently, however, I decided to be more serious about it and registered to take the CFA Level 1 examination this coming December (7 months from now).
I am a strong believer of pursuing your interests, particularly when they will be beneficial to you. Becoming more educated is one of the most important things I can do as a young adult, I think, and when my interests align perfectly with an area I can become more educated in, I think it’s a no-brainer to go for it. Here is a couple of reasons why I chose to enroll in the CFA program:
- A structured approach. The CFA curriculum will give me a very structured approach to learning a lot of topics that I want to learn and never know how to most effectively tackle them. It will also give me a very big incentive to complete the studying by a clear deadline (failing the exam would mean that I’d have to re-register for it, a cost of about $1,000.)
- Credibility. Completing the program will allow me to have the basic knowledge I would need in order to establish my credibility when discussing investments with other knowledgeable folks. It would also allow me to have more flexibility career-wise.
- Practicality. I want to learn enough about the different types of investments available and how to analyze them in order to choose areas to which allocated my assets (as little or large as they may be). Getting some sort of title is a very nice added bonus to this.
- Potential to help. I have a wonderful family that I believe deserves to be very happy and deserves to afford a nice retirement. I want to have the knowledge and tools to help guide them in the process of managing their money, increase their wealth, and retire comfortably.
- Continuous education.Working full-time can be challenging and exciting and it can also provide me with lots of learning opportunities. However, there is always an intellectual part of me that has some interests that need to be fulfilled, and when those deviate with what work provides me, I need to find ways to fix the situation.
I’m not sure what other people think of the CFA Program, but if you have any opinions or tips on how to prepare well, definitely let me know. I would love to hear from you.
Omar
Japan Tragedy – An Opportunity to Help
March 14th, 2011 § Leave a Comment
The earthquake and tsunamis that hit Japan on March 11, 2011 were devastating, and looking through just a few pictures of the incidences is heartbreaking. The death toll I don’t want to even think about, and the amount of damage done by this natural disaster is simply painful to look at. I was terribly concerned with the news but was lucky to find out that my friends are all safe in Japan. That being said, there were many others who are not safe, and the aftershock of this tragedy is still affecting many.
To put things in perspective, the initial earthquake was only the beginning of the tragedy, reaching 9.0 on the ritcher scale. The tsunamis, and many earthquakes after that have been as nerve-wracking and devastating. I can not imagine how people can continue going with their lives when at random moments throughout the day earthquakes keep happening. Furthermore, the nuclear plants that were destroyed and hydrogen explosions keep many alarmed.
The situation is terrible, but just by knowing more about it we won’t fix it. It is time for us to take action and try to help those who are in need. The good news is that many organizations have joined the relief efforts and are currently helping the displaced families as well as the restoration of the affected area. We know the future will be brighter, but to restore an area that has been described to look just as Hiroshima after the atomic bomb was released, a lot of effort will have to be put in. If you would like to join in the effort, the simplest way to do so is through a donation. There are a fair amount of ways to give, but here are a few links to organizations you can donate through:
American Red Cross
GlobalGiving
There are many other ways to give, but these are simple and straightforward ways to do so. Please consider making a donation, no matter how small. A few dollars from each one of us would make a big difference. In moments of crisis like this, many have no choice but to rely in others’ generosity, and it is our opportunity to help them.
Choices & Success
March 6th, 2011 § Leave a Comment
“It is our choices… that show what we truly are, far more than our abilities.”
– J.K. Rowling
As millions of other children, I read every Harry Potter book growing up. The quote above was one sentence that really stood out to me from this entire 7-book series. The reason I like it so much is that I believe that this quote summarizes the difference between success and failure (however you define these). You see, I grew up knowing one thing, if I wished for something I needed to turn hope into action in order to achieve it. My parents were huge on telling people that they could achieve anything they wanted. They taught me to focus on the role I played in building my future, and make the choices that would help me build that future I wanted. What I’ve realized is that there is really not much more to the successes and failures in my life than that, choices made.
Every minute of the day I am faced with decisions to make. Should I have some sweets? Should I workout? Should I do my laundry now, or postpone it until later? Should I buy a new car? Should I quit this job? Should I follow my dream at the risk of failing? I make dozens of decisions every minute. I sometimes choose to think about a particularly pleasant moment of the past, or maybe a not so pleasant one. The main realization, however, is that the person I am today is simply a representation of the choices I have made up until now.
Given this, if for any reason I have trouble with who I am right now, or can’t come to terms with an aspect of my life as it is, wouldn’t it make sense for me to reevaluate my decisions? More importantly, wouldn’t it be wise to rethink the way I chose this path to begin with? There is an awful lot to be said about successful people, but one thing to me is clear, in order for someone to succeed at anything the first step is to own up to their lives. We have all met a confident man or woman that has inspired us. These are the people who know that, no matter what their circumstances were in the past, or what they are now, they can adjust their path as necessary to live a fulfilling life. These people don’t go around blaming others for their circumstances, they focus that extra energy in taking positive action. This is what makes them successful, making the choice to move forward and take control of their lives, instead of choosing to believe that their circumstances have nothing to do with them, and they were just ‘blessed’ or ‘cursed’ with this life as it is.
Let’s pay attention to the choices we make and the thoughts we choose to entertain. If you choose to be jealous at someone, admit it. Also realize that you are weakening your potential by doing so, instead of working hard to achieve your next big goal. If you blame constantly your parents, a lover, or anyone else for the things that have gone wrong in your life , you have some soul-searching to do. At the end of the day no matter how justified we feel to blame someone else for our problems, it does little to solve our problems and a whole lot to make us feel powerless.
Let’s make the right decisions. Next time we choose to say something, think something, do something, let’s choose to say, think or do that which we can be proud of. That’s how we become someone that we can be proud of, by making the right choices.
Collaboration
February 27th, 2011 § Leave a Comment
The easiest way for us to achieve our goals and be successful is to collaborate effectively. This phenomena can be observed everywhere we go. College students who study in a group environment usually benefit from the cumulative knowledge of their peers, allowing them to come up with better and more innovative solutions to problems at a faster pace. Furthermore, having the option to leverage other individuals allows us to specialize in a particular field knowing that when needed we can count on people with expertise outside of our field to offer their assistance.
The benefits of cooperation are not limited to knowledge sharing, but more importantly cooperation often gives individuals the boost needed for them to push through difficult times in their journey. People that start a new exercise regime or start learning a new language are more likely to succeed if they have a group that shares and support their goal. Overall, postivite and effective collaboration allows us to build a better world for everyone around us.
Having this in mind, I’ve always wondered how can we leverage people from all around the world to achieve our goals. After all, when you dig deeper into society you realize that there are millions of people willing to help and support others. Tapping into that huge network of people to help us by guiding us or simply encouraging us to achieve our dreams is a very powerful feat.
WeWoWe started from this concept — it is a place for people to encourage each other to continue working towards achieving their goals and dreams. Although it is still in its early stages, WeWoWe’s target is to become a platform for everyone to track their progress towards achieving their goal, and share it with friends and family, or with the entire world. This is something I am very passionate about, and hence will continue to work hard with my friends to make sure that WeWoWe develops into a platform everyone can use easily and leverage to achieve their goals.
Helping others achieve their dreams is something I am passionate about and I hope that with other people’s support and our collective energy, we will be able to use WeWoWe to achieve just that.
Being Present
January 16th, 2011 § Leave a Comment
Over the past few days I have been re-reading a book I bought about a year or two ago. The book is Everyday Zen: Love and Work (Plus)
The general theme surrounding the discussion in the book is about living in the present and appreciating it. We spent a great deal of time, most of our lives, simply thinking about the past and imagining the future. Those are our main drivers. We even interact with people while thinking in our heads “what should I say next?”, “I need to go do stuff, I don’t have time to talk to you”, etc. We seem to be so lost in our thoughts that we don’t take the time to simply feel what is around us now, and enjoy the present moment. As such, all of our interactions are superficial at best.
Another point made is about our expectations. We constantly seek something different, without stopping to realize that we have nothing other than the present, and the present is ‘perfect’ just as it is. If we simply learn to appreciate the wonders of life, and learn to be compassionate with everyone and everything around us, we would be able to realize that life as it is now is just perfect. Things change inevitably, but if we are grounded in the present, and not fantasizing about a different future or about the past, you’d be at ease most of the time. There would be something peaceful about each moment.
I am just jotting down my thoughts here, and this is by no means expected to be an introduction to anything. But I simply wanted to share these thoughts, since I have found them to be very intriguing. I find them to be very logical to an extent, because anyone can realize that our usual ways of seeking pleasure and happiness tend to be temporary and superficial, and then bring us back to the reality of our daily lives, and we tend to feel disappointment far more often than we should. When we learn to appreciate the little things in life, everything that is happening NOW, maybe then we can be in harmony with the present.
Why not begin that change today? It's a New Year!
January 1st, 2011 § 2 Comments
Why do we celebrate the New Year? Is it really that special of an occasion? What changes as we transition from one calendar year to the other? You can argue that nothing really changes, life simply goes on. However, a new year gives you a framework, a time scale for you to propose new goals to yourself, and carry them through. Reflecting upon the previous year and proposing new, achievable goals for the new year can help us shape our future.
“Nobody can go back and start a new beginning, but anyone can start today and make a new ending.”
- Maria Robinson
Each new year brings with it the opportunity to reevaluate our life and start forging a new path. A year is long enough for us to change and improve many things in our lives, but is short enough for us to be able to reflect upon it and learn from our many successes and mistakes. As such, we should make the most out of this opportunity to reflect and reevaluate our life and goals as we see fit.
There is much you can propose to do this New Year. Make some ambitious goals if you so wish, but don’t simply make goals you won’t work hard to achieve. Make goals in the areas you are truly passionate about, and let that passion energize you and motivate you to achieve them. I like to keep in mind a few things when writing goals:
- Make them achievable within the scope of your current responsibilities.
- Only make goals for things you truly care about.
- Make your goals concrete – be sure you can track your progress over time. Being able to track your progress can both motivate you as you see progress, and let you know if you’re on the right track.
- Make them fun! Why would you propose to do something and then be bitter/bored/sad about it?
- Take baby steps if you’re changing a habit.
- Don’t make too many goals. Focus on one or two big things this year.
There are certain things that you may be able to simply stop doing almost immediately, but that is rarely the case. Hence, I would suggest that if you want to stop doing something, you replace that activity or habit with a new one that you enjoy and allows you to focus on something new. It should be something you like, and helps you get closer to achieving your goals. Let’s bring new energy into our days, spice things up!
Another important thing I like to do is to take time to reflect upon your days. A little bit of relaxation time every day, just 5 minutes sometimes to clear up my head and simply BE, can do wonders for the rest of the day.
Let’s make 2011 a year of transformation for all of us. Let’s make sure that our priorities, goals, and actions are well-aligned. Take the time to trace your path, but leave room for life to surprise you. Then, start your days in a positive note with a few minutes of reflection time, and allowing yourself to be grateful for your life and let the excitement for new opportunities to really sink in.
Cheers to a wonderful 2011. Remember that our life follows the path we trace for it. Clear up your head and trace a path of prosperity, and your life will follow. You will be happier and positively influence those around you.
Thank you everyone for reading this blog and for your comments and words of encouragement. I learn as much or even more from everyone’s perspectives, life experiences, and points of views than from my own experiences. I am very grateful for all the blessings I have had so far, and I want to thank you for being a part of my days.
Lessons from 2010 and a few quotes to keep in mind
December 25th, 2010 § Leave a Comment
Last year, I wrote a rather lengthy post which I just re-read, and although I appreciate it very much because it brought alive some old memories with its prose, I will refrain from duplicating the effort by doing the same this year. Instead, I want to take a few minutes to reflect upon some of the lessons 2010 offered me that I would like to remember throughout the year:
- Treasure friendships. It is friends that give us the strength to continue moving forward when things get difficult.
- If it matters to you, give it your best. No one will ever care for what you ‘could have’ done or achieved, but rather for what you actually did. Make sure you have no regrets.
- When it is time, simply let go. Sometimes we focus on not failing or try to hold on to someone/something and don’t realize that it’s hurting us more than it’s worth.
- Learn from others, but don’t blindly believe everything they say. There are many wise people out there who can give you well-intended advice, but it’s not necessarily the best advice. They can only see the world through their own eyes. Learn from their perspective, but don’t get lost in someone else’s world.
- Follow your own advice. We often have great advice for our friends but are unable to follow our own advice when we need it the most. Be honest with yourself.
- Keep a healthy body and mind. Your body is the instrument you have to make a difference in this world, make sure it is in good shape to allow you to achieve your dreams. Meditate, eat well and exercise.
- Be optimistic and keep happiness simple. It’s the only sustainable way to work and achieve your goals while continue to be happy and healthy.
- Be grateful for what you have. It will allow you to focus on the right things in life.
- Keep your goals in mind. Luck really is when opportunity meets preparation. Make sure you are ready, or working towards being ready, for when the opportunity arises.
- Take a real interest in others. You will become a better person, and make the world a better place, if you genuinely care for others.
There have been many other lessons and great things I have come across this year, and I would like to finish off by sharing some quotes that I would want to read again in the near future.
“Don’t take yourself too seriously, no one else does”
- Regina Brett“Whether you think you can or whether you think you can’t – you’re right.”
- Henry Ford笑う門には福来る
(Good fortune and happiness will come to the home of those who smile.)
- Japanese Proverb“How people treat you is their karma, how you react is yours.”
- Wayne Dyer“It is the simple things done over long periods of time that will give permanent and constant results.”
- T. Harv Eker“Find what you’re going to be famous for. That’s not to say you should ignore your weaknesses. But make sure your strengths are aligned with what you want to be famous for – what your legacy will be.”
And, just to keep it real: “When you are complaining, you become a living, breathing “crap magnet.”"
- T. Harv Eker
I hope this is a good summary of things I want to keep in mind in 2011. I have many goals, but mostly I want to make sure I am on my path to do greater things each day. The specific ways in which I will achieve this remain unknown, but I will let life surprise me with opportunities. I will work on getting myself ready for when the opportunity arises.
First Step to Invest – Manage Your Money
October 30th, 2010 § 1 Comment
“You must acquire the habits and skills of managing a small amount of money before you can have a large amount. Remember, we are creatures of habit, and therefore the habit of managing your money is more important than the amount.”- T. Harv Eker
Before you start investing, you should have a system in place to manage your money. Investments should be made long term, short term investments are usually subject to much speculation. Because of this, it is necessary to manage your money in ways that will allow you to invest for the long term, by keeping sustainable habits.
There are many ways to make your habits around money sustainable. You can have a budget and stick to it. Or you can have a general rule of how you will allocate all of your income. Whatever system you choose that works for you, follow it, just make sure you are spending less than you earn. This budget should allow you to have some money every month to ‘splurge’ on something you want — Go somewhere fancy, do something nice for yourself, etc. You should also have money left over to save. This left over money, your net income for the month, can be used for investing and saving. It will be the money that will, in the long term, give you the freedom you want.
So, the very first step is, decide on a system to manage your money. Personally I like to do the following, recommended by T. Harv Eker on his book “Secrets of a Millionaire Mind”:
- Contribute generously to a retirement plan. A general recommendation is 10% minimum. This is money that will never be touched until retirement. If not to a retirement plan, then to an investments account with money you won’t withdraw until many years later (retirement).
- Try to keep my monthly necessities (food, rent, etc.) to about half of my paycheck (~50-60%) after taxes. This can be challenging, mostly because we want to keep a balance between what we earn and the lifestyle we have with regards to the place where we live, car we drive, etc. It’s just a matter of priorities, would I rather spend the money now and sustain the lifestyle I could have now, or spend less and improve my future lifestyle.
- Take 10% of my paycheck and use it for gifts and charity donations. ‘Give and ye shall receive.’
- Use 10% for savings. This is money for my emergency fund, and once that has been established this 10% will be nice trips, vacations, etc.
- Take 10% to splurge once a month. Go to a spa, stay at a hotel, buy something nice that I don’t “need” but really want.
This is just an example that may or may not work for you depending on your circumstance. What is important, however, is to know that you can make adjustments to spend LESS than what you earn. The difference between what you earn and spend is your net income and increases your net worth.
One simple step everyone can take to start managing their finances and tracking their expenses is the following: sign up for an account at Mint.com. Here are the reasons why:
- This amazing FREE online software keeps track of the money that comes into and out of your accounts, and automatically categorizes them.
- Gives you tips on how to save money by using certain credit cards, opening saving accounts/CDs, etc.
- It also has nice features that will allow you to set up a budget pretty easily and automatically tracks it.
- Allow you to set up your goals, and helps you track the progress towards achieving it.
- Finally, and very important, it lets you easily track your Net Worth (or your Assets minus your debt.)
So now, before you start thinking on how to invest, make money of investments, etc., setup your Mint account, setup your budget, and come up with a reliable plan to start increasing your savings. Then you will be able to start investing without worrying about changes in your investments day to day since you won’t depend on that money to live each day.
Learn About Investments
October 25th, 2010 § Leave a Comment
Virtually everyone we know wants or ‘needs’ more money than they have. This is not surprising, we all have plenty of uses for money. We use it to buy nice things for ourselves or those we love, give it to charitable causes, pay for the services and products we use, etc. While it is not surprising that virtually everyone wants more, it IS surprising that very few people take their time to educate themselves and learn about the many ways they can invest their money so that it will create more money for themselves.
When I first read “Rich Dad Poor Dad” I read about a concept that fascinated me, it was the concept of passive income. It is the idea that there is the possibility to generate some cash without having to be actively ‘working’ to get that money. The money doesn’t fall from the sky, rather you build a source for it. Different sources of passive income can be dividend gains in stocks, interest income from savings accounts, income from rental properties, a paycheck from ads on your website or blog, royalties for published books, etc. There are many other options, you just have to find about them.
Most people I’ve talked to recently have very little idea of ways in which they can generate passive income, or have never thought about it. Many talk about how they don’t have any money to invest, yet you see them buying the latest gadgets Apple has to offer (new iPod/iPhone, anyone?), or eating out a couple of times a month. That, by itself, could be the money you use to ‘jumpstart’ your investments.
Many people think that they will start investing “when they have more money”, but that never happens. Try a different approach, start investing now so you can actually have more money, and continue investing. Each dollar you invest today can start making more dollars for you. Wouldn’t it be nice to have some of your money working for you?
I love the ideas and concept of investing, hence why I’m writing this post. I think there are far too many people close to me that are not spending enough time learning about something that could be the difference between an okay requirement or a GREAT retirement. Many of us are ‘far away’ from retirement, but what some don’t realize is that it is because of that same reason that we SHOULD start investing now. Have you heard about the compounding effect? If yes, then you already know why saving NOW is so important. I’ll write about the compounding effect later on to explain it, but basically, money you invest when you are 25 will become a lot more money over time than money you invest when you are 35 because it has time to ‘grow’ through your investments.
Thoughts, comments, questions? Feel free to write them below, or tweet me @omareduardo
Cheers,
Omar
Personal Branding and Its Extra Weight
October 7th, 2010 § 8 Comments
I have the tendency to write a blog post writing about ‘you’, whoever ‘you’ may be. I talk about how to improve yourself, how to build your healthy habits, how to do this and that. Yet, most of the time I am writing to myself. I simply address it to ‘you’ in an effort to give the best advice I want to give myself but am maybe hesitant or afraid to listen to. In fact, sometimes I take a look back at posts I wrote months ago and wonder… did I write that? How can it sound so foreign to me, yet it’s published on my blog?
I earlier read another blog post by Jeffrey over at ‘The Art of Great Things’ and there was, and still is, an incessant chatter in my head going on. Jeffrey talks in his entry about the concept of ‘Personal Branding’ on blogs and, as someone with a blog, I could identify greatly with many of the things he talked about.
I took a step back and reflected about the concept of ‘Personal Branding’ as to how it applies to my personal ‘offline’ life as well. I remember growing up and thinking that it was weird how people labeled themselves. I thought it was a very strange concept feeling entitled to identify yourself by titles, whatever they would be. Some people would call themselves professionals. Others would decide they were mature, while others would say they were goth or emo, etc. I never felt like I was enough of something to belong to its category, yet in an effort to join the ranks of labeled people I started looking for things that would somehow describe me. Now sometimes I think of myself in certain ways — MIT Engineering graduate, consulting analyst, independent, conscious eater (sometimes), etc.
The problem is, what about when what I truly want to do doesn’t fit that idea of myself I have created and projected? What happened about the whole concept I had as a child of simply doing what I truly wanted? What about those blissful days in which I would walk out of the door and get dirty playing with mud simply because I felt that right then and there, it was the perfect mud for me to play with?
The more I define who I am, the less freedom I have to simply BE. To simply be whatever I want to be at the moment, and enjoy the pleasures offered to me NOW. Instead, I feel pressure about dating the right people at the right time so that others don’t judge me. Or maybe I have felt pressure to continue something longer than I wanted simply to not let others down. Or maybe I’m afraid to reveal to someone that I am gay, simply because I don’t know how they will react.
I cannot determine to what extent my own image of who I think I should be has been dictating my behavior. It wouldn’t matter to me, but I have this discomfort down inside that tells me that I need to reassess the notions I have about myself, and determine what truly makes me happy. I have recently felt threatened by the suggestion that I’m not mature, since this was suggested by someone close to me. I responded by trying to prove my maturity, and this by itself should have proven to me that I have much maturing to do. And although now I realize that, I wonder, how much nicer would that day have been if I hadn’t even been bothered by the comment about my maturity? What if I didn’t identify so closely with the thought of being mature that I let someone’s opposing view spoil my day? Wouldn’t it be better if we stop worrying about people’s thoughts about us and rather focus our energy in enjoying the moment?
Yet as I write all this, I can’t help but wonder… am I being judged for writing this?
