Sacred Cow 1 of 11 - Intro

Introduction to the Sacred Cows from Rich Dad on Vimeo.

I love this documentary put out by Robert Kiyosaki and his Team of Advisors. I think it articulates what many may feel but leave unstated. I often feel like I am on the edge of a financial cliff  while in the mist of a Huge brewing storm. In writing the next 11 post I hope to look at each of the Sacred Cow videos and figure out how they apply to life and figure out a way to over come them.

For the last 54 days I have been consitently working on building cash flow from my online activities and buying stocks that either pay dividends or allow for a covered call strategy to be used on them.

Please post any thoughs you have concerning the video in the comment box below.

Have a great day. Let's Eradicate poverty and Build Wealth, through Financial Education.

Doing what the Rich Do- So I can have what the Rich Have.

I started this blog on May 30th, 2011. My goal for writing this blog is to learn apply and practice principles of wealth an share them with others. Based on my understanding of how to be wealthy, I need to do 3 things: (1) Buy things that pay me, (2) Re-invest my profits, and (3) form a network.

I have successfully completed parts 1 and 2, but I am having difficultly with part number 3. So far I have not been able to form a group and duplicate.

Below is a Snap Shot of my Account at Options Xpress as of Today

In May I was able to purchase 1 share of Microsoft, and 5 shares of ARR. This created a month income from dividends of 60 cent. In June I purchased 7 more share of ARR which increased my dividend income from 60 cent to $1.44. The dividend income was automatically re-invested into a dividend re-investment program (a.k.a "DRIP".) The DRIP purchased .2 shares of ARR giving me a total of 12.2 shares of the stock. This Also increased my monthly dividend income from 1.44 to 1.45. Even though it was just a one penny increase I was encouraged to know that it was working.

In July I purchased 5 more shares of ARR. I have now acquired 17.2 shares of the stock. My dividend income has now increased from $1.45 up to $2.04. If I can get the income above $2.56 I will have taken out target 9 of my 20 step plan.

The hardest part about investing is dealing with commissions. Every time I purchase a stock a 10 dollar commission is paid. So far I have made 4 purchases, and, I have lost 40 dollars in commission transactions. In order to overcome the challenge of dealing with the commissions, I will have to complete step 11 of my 20 step plan. At that time I will covering the commission cost through dividends.

This is slow, but it is working.

Fast N Furious Wealth or Slow N Steady Wealth?

The Slow and the Steady will win the race of Income investing. Contrary to advertisements about investing being done at a Fast and Furious pace, true wealth is more likely to be built at a slow and steady pace. In a previous article I took the model of a penny compounded or doubled for 20 days to use as a model.  If a penny was compounded for 20 days, it would look like this

Target 1 ------------------------------>$0.01

Target 2------------------------------> $0.02

Target 3 ------------------------------>$0.04

Target 4------------------------------> $0.08

Target 5 ------------------------------>$0.16

Target 6 ------------------------------>$0.32

Target 7 ------------------------------>$0.64

Target 8 ------------------------------>$1.28

Target 9 ------------------------------>$2.56

Target 10 ------------------------------>$5.12

Target 11------------------------------> $10.24

Target 12 ------------------------------>$20.48

Target 13 ------------------------------>$40.96

Target 14 ------------------------------>$81.92

Target 15 ------------------------------>$163.84

Target 16 ------------------------------>$327.68

Target 17 ------------------------------>$655.36

Target 18 ------------------------------>$1,310.72

Target 19 ------------------------------>$2,621.44

Target 20------------------------------> $5,242.88

Based on the stocks I have been able to acquire in May and June, I have build a monthly dividend income of approximately $1.49 which takes out Targets 1 through 8. I have been documenting each purchase in my OptionsXpress Investment Journal.

Here are the entries documenting my trades.

Purchases In May

1st Stock Purchase

2nd Stock Purchase

Purchases In June

3rd Stock Purchase

1 Dollar and 49 cent in monthly dividend income is probably not all that exciting to some. But it is not where START that matters...It is where you FINISH.

What are the ways that you are building passive or residual income (Cash Flow)? Please leave your comments or questions in the comment box below.

Stategy discussion 1

In this video Anthony Robbins states that a strategy is a specific way to organize resources in order to get a specific result consistently.

One strategy that consistently works for me is to buy stocks with dividends. I buy ARR and it pays me every month on or around the 30th day of the month. While MSFT pays once per quarter.

I am currently learning how to use the covered call strategy in my virtual account. I know that dividends work as a strategy. However, I am not sure about covered calls. This is why I will start testing it in a virtual account tomorrow.

Powerful Beyond Measure

I like this video. Sometimes it feels like I am getting my A$$ET$ Kicked. I don't know how many times I have been knocked down financially but I constantly tell myself that I can find a way to become successful.


I currently have 1 form of income in the stock market, which is dividend income ($0.60). I must continue to build my account. And, I must face my fear of selling. I have a system in place now but I still have not stepped out on faith yet.


We are powerful Beyond Measure. Have a great day.

Applying Kiyosaki's So Called "Unfair Advantage"

When I facilitate groups with my kids at work,  one of the concepts that I teach them is called "LAP". This is an acronym which means: Learn, Apply, and Practice. The video above is called An Unfair Advantage, which refers to the advantage that a person has when they have learned, applied, and practiced effective financial education. In an earlier post a projection of a penny compounded was shown over a 30 day period. In this article I want to focus on the first 20 days.  I will use the first 20 days as targets to aim at as I write my blog articles. 


Targets 1 through 6 seem to have already been achieved based on my current investing.  Targets 7 through 13 are so small that I am almost embarrassed to mention them, yet they are necessary steps that need to be taken in order to get to higher levels. Targets 14 through 17 would relieve some financial pressure. And, Targets 18 through 20 would create life style upgrade.

Target 1 ------------------------------>$0.01

Target 2------------------------------> $0.02

Target 3 ------------------------------>$0.04

Target 4------------------------------> $0.08

Target 5 ------------------------------>$0.16

Target 6 ------------------------------>$0.32

Target 7 ------------------------------>$0.64

Target 8 ------------------------------>$1.28

Target 9 ------------------------------>$2.56

Target 10 ------------------------------>$5.12

Target 11------------------------------> $10.24

Target 12 ------------------------------>$20.48

Target 13 ------------------------------>$40.96

Target 14 ------------------------------>$81.92

Target 15 ------------------------------>$163.84

Target 16 ------------------------------>$327.68

Target 17 ------------------------------>$655.36

Target 18 ------------------------------>$1,310.72

Target 19 ------------------------------>$2,621.44

Target 20------------------------------> $5,242.88

As a youth counselor I have never earned over 30 thousand a year. Targets 19 and 20 would create financial independence and wealth for most people in my peer group.  The challenge is to figure out how to bridge the gap between Target 7 and 18.


All I can do at this point is take one step at a time. I currently earn approximately 60 cent a month through dividends. I know this is not a lot of money but it is a start. I will start saving at least 30 dollars a month and invest that money into dividend paying stocks. When I have built up enough money I will move into covered calls. My next target is to raise my 60 cent in income to at least 64 cent.


What are your Financial Targets? Please tell what they are in the comment box below.

Dividend Income --> While I Sleep Money?!?!

Making money while you sleep

View more presentations from Demond Johnson

I currently own Microsoft (ticker symbol "MSFT").  It pays a quarterly dividend of 16 cent per share or a yearly dividend of 64 cent. That equals a 2.58% return not including commissions. While it is not a huge return, it is a better return that I would receive at a bank.

A second stock I am holding is ARMOUR Residential Reit Inc (ticker symbol "ARR"). It pays a monthly dividend of 12 cent per share or a yearly dividend of 1.44 dollars. That equals a 18.73% return not including commissions.


There is a Chinese proverb that says "The journey of a thousand miles begins with the 1st step." I love receiving dividend income. While the passive income generated from this stock holdings is not significant, Holding them is helping to take steps forward on the path to success. 


In my opinion it is the best way to convert earned income into passive income. 


That's all I have for now. If you have dividend paying stocks that you like please post them in the comment box.

Applied Wealth Theory

Power  is defined as the ability to cause an intended effect. A common phrase I hear is "Knowledge is Power." I no longer believe this. I now hold the belief that "Knowledge is not Power, applied knowledge is Power." In other words it is not what you know that counts, but what you do with what you know that counts. 


My plan is to buy stocks that pay dividends. I will also by stocks and use a covered call strategy on them. I will re-invest 90% of the profit and use 10 % as an incentive to join our wealth investment network. If this is done consistently a positive monthly cash flow should be created.


In my next post I will embed a report called Making money while you sleep. It will give an example of how buying stocks that pay dividends will start us on the path of wealth. 



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