San Diego, California
A collection of notes and observations by Saul Klein, CEO of InternetCrusade.
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May. 29, 2008
RealTown has just created its First Video Tutorial! It is a little long, but we will soon divide it up into sections so you can jump to the part you want to learn about ;)
This video covers the entire process of creating and editing your RealTown Profile-- Your face on RealTown.
What do you think?
May. 1, 2008
When I was in elementary school in Hawaii (Aliamanu
Elementary School on Salt Lake Blvd and Pearl Harbor Kei in NHA 1), May 1 was a
special day. Not special enough to warrant a full day off, but special enough
for a morning of events and celebration. Lei Day Programs were conducted all
over the Islands. Each grade would do a hula or a skit. There was always a Lei
Queen and her court. These were the sixth graders. Part of the Court were the
Kahili Bearers. I always wanted to be a Kahili Bearer but was not allowed to be
one as my skin was not dark enough. Instead, in sixth grade, I danced to
Houkilau.
Some of you may remember this song of May 1:
May Day is Lei Day in Hawaii
Garlands of flowers everywhere.
All of the colors in the rainbow,
Maidens with blossoms in their hair.
Flowers that mean we should be happy,
Throwing aside our load of cares,
Oh May Day is Lei Day in Hawaii,
Lei Day is happy day out here.
Saul
Saul
Klein
President/CEO,
InternetCrusade
http://InternetCrusade.com
CEO,
Point2 Technologies
http://Point2.com
Have you
visited RealTown.com recently? RealTown.com, the oldest, largest and most
respected online community and network in the real estate industry has been
totally redesigned and offers a wealth of information. Go to http://RealTown.com and check it out today!
Apr. 2, 2008
Are you taking advantage of the Lowes REALTOR Benefits program? If not, you are leaving the door open to other agents in your marketplace.
Under this exclusive relationship, Lowe's will send valuable coupons and rebate offers to your customers and clients, on your behalf, via highly customized direct mail featuring your photo and company logo.
The program works for both buyer and seller prospects. However, the program works on a first-come, first-served basis. First to sign up their clients wins.
Would you rather your clients receive this discount from you or from your competition?
We are often asked about the Lowe's REALTOR Benefits program and what happens to the contact information submitted.
Here is a link to the privacy page. https://www.lowesrealtorbenefits.com/about/privacy.asp
If you are not using this powerful program, you should be. Go to http://Lowes.InternetCrusade.com for more info.
Apr. 1, 2008
In a recent interview I was asked a series of questions concerning the future of the real estate industry.
1. As an "industry visionary", what do you see as the major changes occurring in the real estate industry?
a. More online marketing by brokers and consumers. Predictive Marketing will be more understood by the real estate industry, as it is by other industries. Predictive Marketing provides the information which leads to relevant (more effective) marketing.
b. More Single Sign On (SSO), between associations, MLSs, vendors, possibly other players in the transaction
c. Security and Privacy Issues becoming more important and the possible rise of “trusted” anonymity technologies.
d. Listing Content Syndication, not only to the web, but to other forms of media as well. Distribution trumps destination as content moves to where users are.
e. Social networking technologies will expand the reach of your brand. That means engaging/enabling school groups, homeowners associations and business groups in online conversations. Today those conversation are happening at Yahoo, Google, MSN, AOL, etc.Tomorrow they will be on RealTown (http://RealTown.com. Realtown will create a new venue for those conversations to occur on REALTOR® terms.
f. Lower commissions (after the current slump)
g. Multiple transactions between consumers who “find each other” on the web and packaged and brokered for lower negotiated commission
h. MLS losing its importance and relevance, which, without reconstruction of its value proposition, faces extinction
i. Artificial intelligence software to assist buyers and sellers, possibly minimizing the role of the real estate professional
2. What major "corporate players" are driving changes and what may be their impact?
So, who or what will drive change in this industry? The consumer, and the technology and the defining of business and personal application of the technology will continue to drive the change. Demographics will continue to drive the change. World connectivity will continue to drive the change. The $100 computer project, the theme itself, will drive change.
In real estate, we see companies like Google, CraigsList, e-BAY, Amazon with the potential to take advantage of a changing world. If the industry is too slow to recognize and integrate technology to meet the needs of consumers, these companies, or companies like them will be the agents of change. The impact could be that MLS is no longer needed as a source of available inventory. The role of marketing property will cease to be a role provided by REALTORS and so a new value proposition must be created.
3. Who are the "individual trendsetters" that are shaping the future real estate industry?
Organizationally, I see the California Association of REALTORS and the Houston Association and their subsidiaries as the closest thing to “trendsetters.”
CAR is introducing a software solution they are calling Forms Advisor. It is a form of artificial intelligence transaction driver with great potential. CAR is also pushing for seamless access to MLS data, a move which could extend the life of MLS.
A real courageous and innovative individual trend setter is Bob Hale. He has done things contrary to the conventional wisdom and I believe he will continue to do so if he feels the changes are beneficial to the REALTORS he serves…and he understands that REALTORS must serve their audience, the consumer.
RealTown (http://RealTown) will continue to lead the industry in the application of community, community created content, and social media applications such as blogs, referral networks, local online communities..
Point2 Technologies – Leading in syndication, predictive marketing tools and analytics, international listing platform
4. What are the expectations of the emerging real estate consumer?
This hasn’t changed over the last 10 years…Speed, Convenience, Choice, Value Added, Quality, Service, and Information.
The Real Estate Professionals and companies that survive the major changes taking place in this industry are those that can quantify what they do and how they earn their money, those who can create a "compelling argument" and "value proposition" for the consumer.
One method of doing this is to look at what consumers, not just real estate consumers, but all consumers are looking for today as they shop for products and services. These items can be referred to as "Consumer Demands" and when you look at what you do, how you do it, and how you market it, bring as many of these driving forces to bear as possible:
Speed - think of fast food. The quicker you can take care of the administrative aspects of a purchase or sale, the more valuable you are to the consumer.
Convenience - think of Seven Eleven stores. Also remember that people will often pay a premium for convenience. What do you do for the convenience and comfort of your clients?
Choice - the more alternatives initially, the more consumers like it, but then they narrow it down. Don't we all enjoy choice from ice cream (31 Flavors) to Coffee (Starbucks). What can you do to give your client more alternatives.
Value-added - people like to get MORE than they pay for, this is value added. Real Estate Professionals provide value added services everyday, but few take the time to re-enforce it to their clients. Have you ever cleaned or painted a house for a client after a sale? Helped them move something...or something like that, an extra, that WASN'T in the listing agreement but you did it anyway? That's "Value Added"
Discounts - If it is convenient enough, you will use a coupon. Lots of people look for discounts in everything they do. This doesn't mean you should offer discounts, but you must be aware that for many this is a "driving force" so play to your strengths in your marketing
Quality - Are you willing to pay more for quality? Many people are
Service - think of Nordstrom's which prides itself in its service. Think of Hertz...number One in their business and also the most expensive. Isn't that what you would like to emulate, to be the most expensive and Number One?
Information - this is the age of information! Consumers won't BUY a toaster or a microwave without first buying a copy of "Consumer's Guide", let alone a piece of real estate. Make it quick (speed) and convenient for your clients to GAIN access to lots of (choice) information.
Deliver the above at every available opportunity and your clients will not only love you, they will send you more business.
5. How should the Brokerage and Realtor Association / MLS respond to these real estate consumer expectations?
Create the tools and environment for greater participation and greater access to information, hopefully within the context of the real estate acquisition process. Integrate Web 2.0 concepts and technologies into your web presence as you consider even, web 3.0 and what that might mean to an information based industry such as real estate.
Social networks matter more than websites – The key is to be found. Brokers and agents need to create a presence in the social networking area. Places like MySpace, FaceBook, Zillow, RealTown, etc are relevant to marketing today.
The rise of social media is creating a new form of marketing altogether called Social Influence Marketing (SIM). SIM is about employing social media as part of the entire relationship lifecycle that extends beyond the sales campaign and the point of transaction. Being in the Center of the transaction will only be possible if real estate professionals are in the center of the “Conversation.”
Learn how to maximize the marketing advantage of these different venues.
The consumer is more and more of a new generation, and has different expectations of real estate and of the home buying process, and those expectations will continue to evolve and change with the Digital Generation and their successors. Just about anything one wants to know about is at their fingertips. More informed, connected consumers will require that real estate professionals be more connected and informed. Marketing methods and expectations will change with the technology.
Marketing remains a key component of a real estate professional’s job description. Market yourself, market your services, and market your listing should be your mantra.
6. What changes should a Brokerage implement to ensure profitability in the future?
Technology to allow for more efficiency in all aspects of the business. Close more deals faster with less overhead. Provide more information to consumers and provide the tools to streamline the homebuying process.
Predictive marketing techniques – understanding more about your buyers and sellers based upon their online behavior. Website solutions like those provided by one of my companies, Point2 Technologies (http://Point2.com)
Listing content syndication – Because consumers do not go to one web site, brokers should make their listing content available in as many places as possible. Being able to make this happen with a minimum number of “key stroke” is essential. Place the listings into one data base and have that content distributed to hundreds of points on the Internet, and to other media outlets.
Reporting and analytics of syndicated listing content – Being able to measure the results of the syndicated content partners will allow for more cost effective use of online advertising budgets.
Understand that the REALTOR will never be in the center of the transaction if they are not in the center of the conversation about the most important aspect of most people’s lives, their home.
7. What role do you see the Realtor Association / MLS playing to ensure Broker profitability?
Single point of entry for syndication of content
Education
Political Advocacy
Professional Standards
Facilitate online social and business interaction
8. Based upon your vision of the future of the real estate industry, what are you doing to help influence positive change?
What I have been doing since 1995 – Crusading.
Previewing emerging technologies, help determine their practical application in the industry, and socialize those technologies and applications within the ranks, Brokers, agents, Association and MLS executives and volunteers. Also developing applications and tools for the industry. Our latest is VoteSafe, an online voting application we have created with our partners, Clareity Consulting.
9. What books would you recommend as a "must read" that have influenced your vision?
The World is Flat
The Long Tail
Tipping Point
Wikinomics
Good to Great
Generation Digital
10. What advice would you give Brokerages and Realtor Associations / MLSs to assure they stay relevant and successful in the future?
Remain flexible and develop revenue streams other than MLS.
Redefine your value proposition and what you charge for what you deliver.
Be different, as the choice is to “Be different or charge less.”
Make all members become e-PROs…maybe even provide the financial backing for a more technologically advanced real estate professional.
Apr. 1, 2008
Categorized in: RealTalk Notes
Hi everyone,
Once again, it is April First...Time sure flies. A quarter of the year has passed...and there is much real estate industry breaking news to report to you...so let's not waste any time:
Breaking News:
At 1:53 AM this morning, April 1, 2008, Congress passed the “US in Real Estate” bill.
As part of a bailout package for lenders, the US Treasury will purchase all foreclosed property in the country for 50cents on the dollar, and then re sell and finance them with the assistance of Bear Stearns, for 75cents on the dollar. The bill contained a record 465 earmarks totaling 75 billion dollars.
Brokers and agents wishing to submit offers for clients can make submissions to the Department of Justice, which will be charging a non-negotiable rate of 10 % commission on all sales. The 10% rate was determined at a private dinner meeting attended by officials of the DOJ, FTC and Fannie Mae. Maximum loan amounts will be based on the most current Zestimate.
In a shocking turn of the tables, DOJ Officials also agreed to boycott all members of NAR and only work with members of NAEBA (National Association of Exclusive Buyers Agents).
After the disposition of all properties (estimated to be no sooner than 2018), real estate brokerage by private industry will be outlawed. All real estate transactions will be handled through the combined efforts of the DOJ, which will represent sellers, and the FTC, which will represent buyers. This new Joint entity will be known as US REAL ESTATE, seen on the WWW at http://TheUnitedStatesOfAmerica.com. In keeping with their current practices in most other areas, neither the DOJ nor the FTC will have a fiduciary duty to the buyers and sellers of real estate, their loyalty being to the government. It is anticipated that there will be no disclosure to consumers. A DOJ spokes person tells us, “what they don’t know, won’t hurt them.”
In addition, the DOJ will only accept Exclusive Right To Sell listings; Exclusive Agency listings will be banned.
US REAL ESTATE, will open offices in every major metropolitan area of the country and commissions on the sale of real estate will range from 15% to 25% of the sales price and closing periods will be 1 to 2 years on all transactions. There will be no negotiation of commission as this move is seen by Congress as a great revenue generator for the government. An unnamed DOJ official stated “we at the Department of Justice feel that these fees are very reasonable. Attorneys typically charge 30% to 50% for cases which are contingency based. Real Estate sales are contingency based. If there is no closed sale, no commission is paid, so the fees the government plans to charge are very reasonable.”
In other news critically impacting the real estate industry :
Congress is expected this spring to approve the long-awaited amendments to the RESPA rules and regulations. Among the key changes are:
1) the dollar amount of acceptable gifts from banks and title companies to referring real estate agents has been increased to $10,000;
2) HUD-1 disclosure statements must be translated into the buyer's language of choice; and
3) brokers may pay kickback fees to doctors and lawyers but not to teachers and insurance agents.
On the personal front:
Bob Goldberg, NAR Senior VP Marketing has decided to retire from the Association, and has changed his name to Bruce Springstein. Bob is quoted as saying: “Goldberg, Springstein, what’s the difference, no one will know and we should pack stadiums across the country before anyone catches on.”
Following his tenure at REALTOR.com and his Move from Move.com, Alan Dalton has set his sights on winning the PGA Championship in 2008. For more information on this story go to http://ProfessionalGolfersAssociation.com.
And that’s the way it is, April 1, 2008.
Saul Klein
President/CEO, InternetCrusade
CEO, Point2 Technologies
Jan. 15, 2008
Categorized in: Announcements
 Wow, Saul!
We knew you were in New York City for the Inman Conference, but didn’t know we would see you bigger than life on Broadway. This picture, captured by a freelance photographer, shows the electronic message board in Times Square that ran numerous times between December 18 and 20 announcing that you were named CEO of Point2 Technologies in a release from the worldwide Reuters News Service.
The folks at Point2 in Saskatoon have captured the image and have it framed in the Point2 lobby right next to the article in the Wall Street Journal. Must make your staff feel great about the impact you have in the industry.
As usual, you are ahead of the curve. And those here at InternetCrusade know the value you bring to the industry. Congrats and keep up the good work.
Don’t worry, Spring is coming soon. ;-)
Rich Hudson
Director of PR/Marketing
InternetCrusade
(619) 283-7302 Ext. 602
Rich@InternetCrusade.com
Dec. 31, 2007
Categorized in: Announcements
On January 1st I assume my new responsibilities as the CEO of Point 2 Technologies. I fly to Saskatoon early tomorrow morning (New Year’s Day) to spend a week at Point2 before heading to New York City to attend Inman Connect. I have a lot of work to do to get a firm understanding of all the products and services, hardware and software, and also the current management structure and all the people working at Point2. Having said that, I have already spent considerable time on this and my major areas of emphasis for 2008 will be:
People:
Employees - The biggest investment and greatest asset of the company, of many if not most companies, are the employees. Happy, satisfied employees insure the best performance. My background as a Naval Officer leads me to put people above all else. One of my favorite leadership quotes is by John Paul Jones, Father of the US Navy..."Men mean more than guns in the rating of a ship." Working with the Team at Point2, stressing the value of the Team, and working to build the Team is high on my list of priorities.
Customers – Our customers deserve the best, and consumers will remain loyal to a company that puts them first. First rate customer service will continue to be emphasized at Point2 as we work to exceed expectations at every opportunity. I will be looking to our customers to help us make our products and services better and more useful than ever. The best way to ensure our customers get the most out of the products and services is to provide them with effective and convenient training, which will continue and grow at Point2.
Product Development:
Developing products our customers can use, based in large part on what our customers tell us they want and need. I will continue to spend two weeks a month (instead of three weeks) traveling around the US and Canada, talking to REALTORS, Real Estate Associations, MLSs, Brokers and Managers, and also communicating with our customers in the heavy equipment sector, essentially working to understand what our customers need so they can serve the changing consumer needs…putting technology to work in their business. The real estate industry continues to transition, in part due to generational differences. At Point2 we will work to help define the future, not just react to it.
Revenue:
Exploring old and new revenue opportunities to fund existing and new projects for the benefit of our customer base and the company.
Alliances:
Joining together with the best to bring our customers the best. Few companies can do it on their own -- strategic alliances, partnerships, and shared services are critical to the success of most companies today.
And what about InternetCrusade?
We will continue to provide the products and services to which our customers have become accustomed. Look for more innovation at RealTown, new online courses, enhanced e-mail services, more SSO (Single Sign On), Security Solutions, and Strategic Alliances and Partnerships. I will spend one week a month and weekends in San Diego (which is the same amount of time I have been spending in San Diego since April 2002). At IC we have the technologies in place (developed in-house by our programmers) that allow me to run the business without a constant presence in San Diego. I also have my partners John Reilly and Mike Barnett, and my “Secret Weapon,” our Chief Operating Officer, Janie (who is also my wife and takes care of the details of the company), and our staff of 40 fantastic people who make me look good.
Have a safe and Prosperous 2008!
Saul
Dec. 30, 2007
Despite what you may read in the financial
press, real estate has always been and continues to be, the IDEAL investment.
The best real estate most of us will ever own is the real estate we bought
yesterday (or last year, or ten years ago, or even longer ago). Everyone you
talk to wants to own real estate. Few people will tell you they purchased more
real estate than they should have. In fact, just the opposite is true. Most people
will tell you that they wish they had purchased, and held on to, more real
estate over their lifetime. The major drawback of real estate as an investment
in years past has been its liquidity. For the most part, and particularly with
technology and the Internet, that is no longer much of an issue. Properly
priced property sells and real estate can be turned into cash should the need
arise. The secret of course (not much of a secret), is not to be forced to sell
but to sell when the market will yield the greatest return to you, the
investor. "Buy low, sell high" is sage advice, but when it comes to
real estate. "Buy, hold for a long time, sell" will almost always
yield fantastic overall investment results.
Real Estate Investment Objectives:
Income - Real estate investments structured with enough down
payment, will generate a positive cash flow. As time passes, in most markets,
even a highly leveraged, negative cash flow property can turn into a positive
cash flow investment.
Depreciation - Theoretical Depreciation is the tax deduction one
can use against the income real estate produces. Depreciation is a "non
cash expenditure." Residential income property is usually depreciated over
27.5 years. Only the improvements are depreciable, not the land.
Equity Build-up - This results from the periodic pay down of the
principal amount of the loan, usually through monthly payments on an amortized
loan. Even if there is no appreciation over the life of the loan, the property owner
would end up with a free and clear property at the end of the loan payment
period on a fully amortized loan. This is usually a 30 year period on
residential property.
Appreciation - While the amount of appreciation varies from market
to market, real estate is a growth asset and often the largest part of the
return on an investment in real estate is the equity gained through
appreciation. Even small amounts of appreciation year after year can be
considerable. Usually, the longer you hold on to a property, the
better. The effect of appreciation is greatly magnified by the use of
leverage.
Leverage - Through the use of borrowed money (OPM - Other
People's Money), combined with a small amount of money of your own, you can
control real property. The best leverage most of us can obtain in the stock
market is 50%. In real estate, it is not unusual to obtain 80%, 90%, and even
100% leverage. With leverage usually comes risk, and with risk comes potential
for investment reward.
In addition to the IDEAL as stated
above, real estate investments have potential additional tax benefits -
Investors are allowed to write-off (within income limitations) all operating
expenses, interest on loans secured by the property, and property taxes. Also,
Gain from the sale of real estate is treated as capital gain and investors also
have the option of exchanging which, if done in accordance with the tax laws
(IRC 1031), can result in partial to no recognized gain, which effects the
immediate cash tax consequence.
What are you willing to pay today for a
real estate investment to enjoy the IDEAL benefits outlined above? In other
words, what is the "present worth of future benefits" to be derived
from a real estate investment? We would refer to this as the value, and there
are different types of value.
FAIR MARKET VALUE - The
highest monetary price which a property would bring, if offered for sale for a
reasonable period of time in a competitive market, to a seller who is willing
but not compelled to sell, from a buyer, willing but not compelled to buy, both
parties being fully informed of all the purposes to which the property is best
adapted and is capable of being used.
Loan Value - Since a lenders security for a
real estate loan is the sale of the real estate in the event of default on the
loan, loan value is usually a conservative estimate of market value.
Value is determined three different ways,
known as Approaches to Value by appraisers. The three Approaches to Value
are the Market Data Approach, the Cost Approach, and the Income Approach.
Keep in mind that future income is impacted,
positively or negatively by the "Four Great Forces" that influence
value. Investors should be cognizant of these forces in the areas in which they
own property or plan to own real estate. These "forces" will have an
impact on the income which can be generated from any given property and the
value of income producing property is directly related to the income the
property produces.
The Forces Influencing Value are:
1. Physical Forces - the quality and
convenience of schools, shopping centers, playgrounds, transportation systems,
etc. It also includes the climatic conditions.
2. Social Forces - Population growth or
decline; Marriage, divorce and birth rates; educational and religious
standards.
3. Economic Forces - Business and real estate
cycles, variations in directional growth, natural resources, wage levels, tax
levels and insurance schedules.
4. Political Forces - Zoning, fire and police
protection, government loan and other subsidy programs.
Value by the Numbers
1. Gross Multipliers - Value=GSI X GM
Does not take into consideration expenses.
2. The value of income producing property is
directly related to the net income the property produces. The greater the net
income, the greater the value. Net income can be increased by increasing gross
income, by decreasing expenses, or a combination of both.
Income - Rent amounts are usually controlled
by supply and demand
It is net income that we are most concerned
with
Gross Scheduled Income
-Vacancy and Uncollectible Rent
Effective Gross Income
-Operating Expenses (Fixed and Variable)
Net Income
-Debt Service
Cash Flow
-Added Taxes
Net Spendable
Increases and decreases in income increase
and decrease value.
If you can increase the net income by increasing
rents or decreasing expenses, you increase the value.
Income = Rate X Value - You can use this as a
comparison without understanding capitalization rate.
Changes in value based on changes in income.
3. Value by Tire Kicking
Cost per Unit
Unit Composition
Parking
Noise
Type of Roof
Individual Utility Meters
Size of Units
Seller Financing Assistance
Deferred Maintenance
Individual Water Heaters
Modern Kitchen
Orientation, Light or Dark
Price per Square Foot
Put on your tenants hat
What about assemblage and plottage
Rents and the Rental Market Place
You, as an investor, should be able to
determine the dynamics of the rental market and in fact, should not purchase
until you thoroughly acquainted with it.
Contract Rent - what is being paid under the
existing rental agreements and for how long.
Economic Rent - what could be charged on the
open market if the property were readily available.
Consider Rent as to:
Quantity - how much is collected
Quality - financial stability of the tenant. For
commercial property, you can ask to see the financial statements of commercial
tenants if the lease so provides. For residential income property, review the
rental applications of tenants.
Durability - if the property is residential,
you may be concerned if the term of the lease is for a prolonged period. If the
property is commercial, industrial or office type, you want the lease term to
be at least three to five years.
How do you determine market rents? You call. Do
continuous rent surveys. Be up to date in your market area.
Saul
Saul Klein
President/CEO, InternetCrusade
Have you visited RealTown.com recently? One of the oldest, largest and most
respected online communities in the real estate industry has been totally
redesigned and offers a wealth of information. Go to http://RealTown.com and check it out today!
Dec. 25, 2007
Categorized in: Publishing
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Numbah One Day of Christmas
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See the Palm Tree Dance in the Hawaiian Breezes as Saul Klein Sings
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December 25th, 2007 - 12:01 am
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Numbah One Day of Christmas
(The 12 Days of Christmas Hawaiian style)
Click This Link To Hear Saul Sing
 Numbah One day of Christmas, my tutu give to me
Wun Minah Bird in Wun Papaya Tree.
Numbah Two day of Christmas, my tutu give to me
Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Tree day of Christmas, my tutu give to me
Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Foah day of Christmas, my tutu give to me
For flower leis, Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Five day of Christmas, my tutu give to me
FIVE BIG FAT PIGS,
For flower leis, Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Seex day of Christmas, my tutu give to me
Six hula lesson,
FIVE BIG FAT PIGS,
For flower leis, Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Seven day of Christmas, my tutu give to me
Seven fish a-swimming, Six hula lesson,
FIVE BIG FAT PIGS,
For flower leis, Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Eight day of Christmas, my tutu give to me
Eight ukulele, Seven fish a-swimming, Six hula lesson,
FIVE BIG FAT PIGS,
For flower leis, Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Nine day of Christmas, my tutu give to me
Nine pound a poi, eight ukulele, Seven fish a-swimming,
Six hula lesson,
FIVE BIG FAT PIGS,
For flower leis, Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Ten day of Christmas, my tutu give to me
Ten can a beer, nine pound a poi, Eight ukukleles,
Seven fish a-swimming, Six hula lesson,
FIVE BIG FAT PIGS,
For flower leis, Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Eleven day of Christmas, my tutu give to me
Leven hula dancers, Ten can a beer, Nine pound a poi,
Eight ukuleles, Seven fish a-swimming, Six hula lesson,
FIVE BIG FAT PIGS,
For flower leis, Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree.
Numbah Twelve day of Christmas, my tutu give to me (we save da bes for las)
Wun dozen masaladas (from Leonard's),
Leven hula dancers,
Ten can a beer,
Nine pound a poi,
Eight ukuleles,
Seven fish a-swimming,
Six hula lesson,
FIVE BIG FAT PIGS,
For flower leis, Tree dried squid, Too coconuts,
and Wun Minah Bird in Wun Papaya Tree!
 Aloha and Mele Kaleke Maka,
Saul
Saul Klein
President/CEO InternetCrusade
Click the Dancing Palm Tree and Hear Saul Sing
Dec. 25, 2007
This is the time of year we begin to plan for the new year...the time we
examine and re-examine our personal goals and objectives. Our goals for
the
year should serve our longer range goals...our 5 year, 10 year, and
lifetime goals.
Goals:
1. Must be in writing
2. Must be measurable
3. Are anticipated events or results
4. When valued, become priorities
A long term goal for most real estate professionals (most working
people) is to achieve Financial Freedom, which is attainable by
understanding a few
simple concepts...the first being that small amounts of money saved and
compounded over long periods of time turn into large sums of money.
Another
important concept is keeping track of where you spend your money, for
business, everyday living and pleasure.
Some practical tips:
Since money is important to the conduct of your life and business,
commit to making ledger (or software such as Quicken) recordings of your
expenses
every day.
Most of us spend money on average, 4 to 5 times a day. We either:
1. Pay cash
2. Charge on a credit or debit card
3. Write a check
Four to Five entries into Quicken (or into a ledger) each day will take
no more than 5 minutes...and that 5 minutes a day will lead you to
financial
freedom...yes financial freedom.
Here is the secret...you must be committed to your financial success. It
must become a small part of your daily life. Commitment is the key. The
following is one of the best and most inspirational comments on
commitment ever written. Read it...memorize it...think about it. Look at
your past successes and you will probably find personal evidence of the
truth and power of this statement. I know I did and do everyday.
>>
Until one is committed
There is hesitancy, the chance to draw back,
Always ineffectiveness.
Concerning all acts of initiative and creation
There is one elementary truth,
The ignorance of which kills countless ideas
And splendid plans:
That the moment one commits oneself,
Then providence moves too.
All sorts of things occur to help one
That would otherwise never have occurred.
A whole stream of events issues from the decision,
Raising in one's favor all manner
Of unforeseen incidents and meetings
And material assistance
Which no man could have dreamt
Would have come his way.
I have learned a deep respect
For one of Goethe's couplets:
"Whatever you can do, or dream you can - begin it.
Boldness has genius, power, and magic in it".
W.N. Murray
The Scottish Himalayan Expedition, 1951
<<
Commitment to your personal Financial Freedom is the first step
achieving it.
Saul
Saul Klein e-PRO/GRI
Certified Financial Planner (CFP)
President, InternetCrusade
1993 President, San Diego Association of REALTORS
1999 REALTOR of the Year
Sign up for e-PRO: http://www.eProNAR.com
(619) 283-7302 Fax: (619) 283-7343 MailTo:Saul@InternetCrusade.com
Dec. 25, 2007
About 10 years ago I created a 100 page manuscript on the
topic of personal financial planning and began to teach a two day program with
the goal of helping the attendees create the framework of a personal financial
plan and a check list to complete and implement it. The following is from that
manuscript. Make 2008 your year to put your personal financial plan in place.
Financial Freedom by Saul
Klein
Achieving Financial Freedom requires consistent review of
one’s goals, objectives and priorities, and commitment to the accomplishment
of those goals and objectives based on those priorities.
Defining your goals and objectives can be a difficult
task. But doing so is critical. Without clearly defined goals, successful
financial planning, and
the result of successful financial planning, Financial
Freedom, is rarely possible.
General Personal and
Financial Objectives:
Enhancing your net worth through financial strategies
which are congruent with your personal goals and consistent with your attitudes
toward investing
and tolerance for risk.
·
Protecting your accumulated assets from erosion
caused by inflation.
·
Optimizing your cash flow over the planning
period.
·
Preventing loss of capital by minimizing risk.
·
To maintain a comfortable standard of living (or
exceptional standard of living) for yourself and family.
·
Achieving a better understanding of individual
financial planning.
·
Maintaining sufficient liquidity to respond to
unforeseen emergencies, or opportunities.
·
Coordinating and effectively manage your financial
affairs.
Cash Management
Objectives:
·
Increase funds available for investment and
lifestyle through more effective cash management.
·
Simplify your system of managing your cash.
·
Maximize the return on your cash accounts.
Tax Planning Objectives
·
Reduce your personal income tax liability.
·
Understand the remaining few tax-advantaged
investments.
·
Manage your tax records more effectively.
Investment Management
Objectives:
·
Optimize the return on your invested capital
consistent with your tolerance for risk.
·
Establish a balanced, diversified investment
portfolio.
·
Understand the use of leverage and determine
your appropriate level of debt.
Risk Management
Objectives:
Evaluate the appropriateness and cost effectiveness of your
current insurance coverage Life
·
Disability
·
Casualty
·
Medical)
·
Business
·
Errors and Omission
Specific Funding
Objectives:
·
Accumulate adequate assets to provide you and
your family a comfortable retirement, without disabling loss of purchasing
power during your "golden
years".
·
Provide funds for a quality education for your
children.
Estate Planning
Objectives:
·
Minimize estate and inheritance tax.
·
Allow for the orderly and efficient distribution
of your assets in accordance with your wishes.
·
Reduce the burden of estate management for your
heirs.
Although these are separate and distinct objectives, they
are not mutually exclusive. By viewing all areas of your finances as a
comprehensive whole,
taking into account all the interrelationships among all
the financial issues you face, you control the financial events in your life
rather than
the other way around.
Financial Planning is:
·
Bringing the future into the present so you can
do something about it today
·
A philosophy
·
A state of mind
·
It is not a destination, it is a road. (The road
to success is always under construction)
·
It is a continuous effort of research,
education, and self-motivation.
·
It is continuously reviewing objectives,
weighing alternatives, and making choices.
Saul
Saul Klein e-PRO/GRI
Certified Financial Planner
(CFP)
President/CEO, InternetCrusade
1993 President, San Diego Association of REALTORS
1999 REALTOR of the Year
Sign up for e-PRO: http://www.eProNAR.com
(619) 283-7302 Fax: (619) 283-7343 MailTo:Saul@InternetCrusade.com
Dec. 25, 2007
Financial Freedom - How to Quantify your Objectives and Beginning the
Journey
When you mention retirement to many people in the real estate business
they will tell you that they "never want to retire." That is a cop out.
If
selling real estate forever is your idea of a good time, then you are
retired right now.and you still need a reserve fund for those slow
periods
in the economic cycle so you can do "whatever you want to do, whenever
you want to do it, with whomever you want to do it with."
One of the reasons so few people achieve Financial Freedom is that they
fail to quantify their objectives. How can you get to where you want to
go if you
don't know where it is? You must have a target. From there you can
develop a planning horizon and a savings and investment strategy. In a
previous
article we discussed different funding objectives. Here, we will
consider the big one, retirement. The methodology is the same for any of
your
specific funding objectives.
Consider that there are 3 primary methods of generating income:
1. You at work - slavery
2. Others working for you - slave owner
3. Your assets at work - Money is the best employee; money never sleeps,
money never gets sick, money never takes a vacation.ultimately, you want
the
bulk of your income derived from this income generating method.
Your goal is less of 1 and 2 above and more of number 3
To arrive at this point in your life (some call this retirement), you
must increase your net worth over your working career, saving what you
can to get
to a point where your financial needs are met by the money you have
accumulated, suitably invested (suitability is a conversation for
another time).
So how much money must you accumulate, and how do you accumulate what
will no doubt be a substantial sum? Let's tackle the amount first.
You begin by deciding how much money per month you require to maintain
the standard of living you are looking forward to in retirement. You can
change
this number anytime you like.it is your retirement, but we need to start
somewhere. Let's assume that number is $6,000 per month (and that
includes
the state and federal income tax required).
$6,000 per month is an annual income of $72,000 per year.
Now let's pick a conservative rate of return.5% (you can change this as
well;if you can get more than 5%, you will need to accumulate less, but
we
must make some assumptions or we remain stuck in inaction).
The formula we use is one that is familiar to most real estate
professionals:
Income = Principal x Rate ( x Time, Time being 1 year)
Our Financial Freedom Target is the amount of money invested (Principal)
at 5% (Rate) resulting in $72,000 per year (Income).
Dividing $72,000 by 5% (.05) results in $1,440,000
To generate $72,000 in income from capital invested at 5%, you need to
accumulate $1,440,000 over your working career. You must accumulate this
money from the money you earn and from the money your invested money
earns.
How is that possible you might ask? If you are like most people, there
is too much month at the end of the money.
Simply stated you must:
1. Increase savings
2. Reduce taxes
3. Reduce luxuries (for the time being)
4. Live more efficiently (financially)
5. Make your invested dollars work harder
Of all the areas we consider in financial planning, effective month to
month cash management can contribute most to your goal of increasing
your net
worth and gaining control over your financial affairs. It doesn't matter
how complex your financial situation is, it all boils down to this: you
earn
money on one hand and spend it on the other. What remains before
investment spending is "gross cash flow." This is the amount you can
manipulate to
increase your net worth.
If you haven't read Clauson's "The Richest Man in Babylon," I highly
recommend it. In it Clauson gives us the "Seven Cures of a Lean Purse."
1. 10% of all I earn is mine to keep. I will learn to live comfortably
on 90% of my income.
2. Put my money to work earning more money, and that money to work in
turn.
(Saul's note: Invest it in assets that:1. Increase in value 2. Earn
income
3. Increase in value and earn income)
4. Guard my money from loss. Know about what I do. (Knowledge)
5. Own my house.
6. Provide in advance for my old age and the needs of my family.
7. Cultivate my own powers. Become wiser and more skilled.
Pay Yourself First
Pay the most important person in your life, you, first. You pay yourself
10% of what you earn before you pay anyone else. You then discipline
yourself to
live on the other 90%. Master this and you are on your way to Financial
Freedom.
Financial Success Secret: Small amounts of money accumulated and
compounded over long periods of time really add up. The real magic is
time and consistency.
If you were to save 10% of your annual income for 16 years, earning an
average of 16% compounded annually, you could replicate that income
forever
on the interest earned on the accumulated capital!
Of critical importance to achieving Financial Freedom is the magic of
compound interest.
Saul
Saul Klein e-PRO/GRI/CFP/JIM/JPO/USNA '72
President, InternetCrusade
1993 President, San Diego Association of REALTORS
1999 REALTOR of the Year
Sign up for e-PRO: http://www.eProNAR.com
(619) 283-7302 Fax: (619) 283-7343 MailTo:Saul@InternetCrusade.com
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