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The Permission Paradox: How Your Finances Wait for Unconscious Approval

On November 5, 2025

In Blog, Debt, Entrepreneurship, personal, Tom Leydiker

Sarah, a high-earning attorney, couldn’t explain why her savings account remained perpetually empty despite her $200,000 annual income. She had created budgets, downloaded finance apps, and read countless money management books, but nothing changed her financial trajectory. During a breakthrough coaching session, she realized the invisible psychological barrier: “I’ve never given myself permission to be financially secure.”

This realization exemplifies what financial psychologists call “the permission paradox”—the phenomenon where our financial behavior is governed less by knowledge or resources than by unconscious permissions we’ve either granted or withheld from ourselves. Despite having ample information and capability, many people remain financially stuck until they address this deeper psychological dimension.

The permission paradox explains many puzzling financial behaviors:

High-income professionals who continually live paycheck-to-paycheck
Entrepreneurs who sabotage businesses as they approach significant profitability
Investors who reflexively sell assets as they near certain valuation thresholds
Individuals who receive windfalls but rapidly return to previous financial states
Skilled negotiators who never apply their abilities to personal compensation

In each case, the limiting factor isn’t capability but permission. The individuals have unconsciously established boundaries around their financial possibility, creating invisible ceilings that technical knowledge alone cannot penetrate.

These permission boundaries typically originate from three primary sources:

Formative Experiences

Our earliest exposures to money create powerful imprints that establish boundaries of financial possibility. Children who witness financial struggle often internalize scarcity as normal, while those who observe money conflict may develop permissions that prioritize peace over prosperity.

Mark, who grew up watching his parents’ bitter arguments over finances, discovered that his adult money avoidance stemmed from an unconscious permission structure: “I’d rather earn less than deal with money conversations that could create conflict.” This permission, while originally protective, limited his earning potential for decades until recognized and revised.

Social Identity Construction

We develop permissions that align with our core identity narratives and social groups. People who identify as creative, spiritual, or service-oriented often withhold permission for wealth accumulation based on perceived conflicts with their essential character.

“I always saw myself as an artist, and in my mind, artists weren’t supposed to be financially successful,” explains Elena, a graphic designer who unconsciously sabotaged client relationships whenever her income approached six figures. “I needed to give myself explicit permission to be both creative and prosperous before my behavior could change.”

Protective Adaptations

Many permission structures originate as psychological protections against potential threats. If wealth triggered family jealousy or community exclusion in your past, your permission structure might limit financial success to avoid these anticipated negative consequences.

James, who grew up in an economically depressed community, discovered his success ceiling resulted from an unconscious rule: “If I become too successful, I’ll lose connection with my roots.” This permission structure kept his business artificially small until he developed more sophisticated ways to maintain important relationships while allowing financial growth.

The most challenging aspect of the permission paradox is that these boundaries operate outside conscious awareness. People experience the effects—persistent financial limitation despite knowledge and opportunity—without recognizing the cause. This leads to cycles of frustration, self-blame, and ineffective solutions focused on surface behaviors rather than underlying permissions.

Transforming permission structures requires specific interventions that address this deeper psychological level:

Permission Archaeology

The first step involves excavating your existing permission structure through structured reflection. Key questions include:

What financial situations make you inexplicably uncomfortable?
What were the money messages in your family of origin?
Which financial achievements would feel “not like you”?
What negative consequences do you unconsciously associate with financial success?
Whose approval or disapproval still influences your financial behavior?

This exploration often reveals surprising boundaries. One client discovered her savings had remained precisely below her unemployed father’s annual income for decades—an unconscious loyalty permission that limited her prosperity to avoid triggering his insecurity.

Permission Reconstruction

Once existing permissions are visible, they can be deliberately restructured. This process involves:

Creating explicit written permissions that counter limiting beliefs
Developing visualization practices that normalize new financial possibilities
Identifying and processing the emotions associated with permission expansion
Establishing relationships with individuals who model expanded permissions
Taking graduated actions that extend slightly beyond current permission boundaries

Effective permission reconstruction addresses both cognitive understanding and emotional acceptance. Many people intellectually recognize their permission limitations but remain emotionally bound by them until deeper work occurs.

Identity Integration

Sustainable financial transformation requires integrating new permissions with core identity. This integration prevents the “snap-back” effect where temporary changes revert to baseline as identity reasserts itself.

Approaches that facilitate this integration include:

Reframing wealth as an extension of core values rather than a contradiction
Identifying meaningful purposes for expanded financial capacity
Developing narratives that connect financial success with authentic self-expression
Creating community with others who share both your values and expanded permissions

This integration is particularly important for individuals whose identity includes non-materialistic values. Rather than rejecting these values, successful integration shows how expanded financial permissions actually enable their fuller expression.

Environment Restructuring

Permission structures are continuously reinforced or challenged by our environments. Sustainable change requires adjusting our surroundings to support expanded permissions through:

Restructuring physical spaces to reflect new financial possibilities
Recalibrating social relationships that reinforce limiting permissions
Creating accountability systems specifically focused on permission expansion
Modifying information inputs to normalize new financial thresholds

These environmental adjustments prevent unconscious regression to previous permission structures through constant external reinforcement.

The permission paradox reveals why traditional financial education often fails to create change—it addresses what to do without addressing whether you’ve given yourself permission to do it. Technical knowledge remains inert until activated by internal authorization.

For those facing persistent financial limitations despite knowledge and opportunity, the most powerful question isn’t “What should I do?” but rather “What have I given myself permission to achieve?” The answer often reveals the true barrier to financial transformation.

The Bankruptcy Paradox: Why Financial Failure Often Creates Millionaires

By Tom Leydiker

On September 5, 2025

In Blog, Debt, Entrepreneurship, Finance, personal, Tom Leydiker

When Catherine lost everything in 2008, filing for bankruptcy after her small business collapsed under the weight of the financial crisis, she didn’t realize she had just significantly increased her odds of becoming a millionaire. Yet a decade later, her net worth exceeded $2.3 million—a transformation that exemplifies what financial researchers call “the bankruptcy paradox.”

This counterintuitive pattern—where complete financial failure becomes the catalyst for extraordinary future success—appears repeatedly in wealth creation studies but remains largely unexamined in mainstream financial discourse. The statistics are striking: individuals who have previously experienced bankruptcy are nearly three times more likely to eventually accumulate seven-figure net worth compared to demographically identical individuals who never face financial collapse.

This pattern challenges our fundamental narratives about financial success and failure. We typically view bankruptcy as a terminal financial event—the point where wealth creation ends rather than begins. Yet for a significant subset of bankruptcy filers, it represents something entirely different: a transformative psychological and practical reset that enables wealth building on an entirely new foundation.

Understanding this paradox requires examining the unique psychological and practical changes bankruptcy often catalyzes:

Psychological Recalibration

For many, bankruptcy eliminates the paralyzing fear of financial ruin. Once you’ve actually experienced your worst financial nightmare and survived, money anxiety often diminishes dramatically. This fear reduction enables rational financial decision-making previously blocked by emotional responses.

Catherine describes this shift: “Before bankruptcy, I was constantly paralyzed by financial anxiety, making desperate moves to avoid failure. After bankruptcy, that fear was gone—I’d already faced the worst. This emotional freedom let me make calculated risks with clarity I never had before.”

This psychological reset often triggers what researchers call “post-traumatic growth”—a profound values recalibration that follows significant life disruption. Bankruptcy survivors frequently report complete transformation in their relationship with money, materialism, and status markers. They develop financial values focused on security, sustainability, and true wealth building rather than consumption or external validation.

Skills Development Under Pressure

Bankruptcy creates extreme conditions that forge rare financial skills. Operating with damaged credit, limited resources, and heightened scrutiny forces the development of exceptional cash management capabilities, negotiation skills, and resource optimization strategies that most people never develop in normal financial circumstances.

“When you can’t use credit and have limited cash, you develop different muscles,” explains Michael, whose post-bankruptcy journey took him from financial devastation to an eight-figure business. “I learned to negotiate everything, manage cash flow with extreme precision, and evaluate opportunities based solely on fundamentals rather than optimistic projections.”

These hard-earned skills provide significant competitive advantage when applied in more favorable circumstances after financial recovery. The bankruptcy survivor often possesses financial capabilities and perspectives that others never develop without similar crucible experiences.

Elimination of Unsustainable Structures

For many, bankruptcy functions as a forced unburdening from fundamentally unsustainable financial structures. Debt obligations, lifestyle commitments, business models, and financial patterns that were mathematically destined for eventual collapse are eliminated in one decisive reset.

While painful in the moment, this clearing of financial deadwood creates possibility for rebuilding on more sustainable foundations. Many bankruptcy millionaires report that their previous financial trajectory had no viable path to genuine wealth—they were trapped in high-income, high-expense cycles that created apparent success without actual wealth accumulation.

Network Reconfiguration

Perhaps most significantly, bankruptcy often forces complete reconstruction of social and professional networks. Research consistently shows that our financial behaviors are heavily influenced by our reference groups—we naturally calibrate spending, saving, and investment behaviors to match those in our immediate social circles.

Financial collapse frequently necessitates leaving social environments that encouraged destructive financial patterns. This network disruption, while initially traumatic, creates opportunity to deliberately construct new reference groups that support wealth-building behaviors rather than undermining them.

Practical Path Implementation

The bankruptcy paradox isn’t merely interesting sociology—it offers practical insights for wealth creation regardless of whether you’ve experienced financial collapse:

Conduct a simulated bankruptcy review: Periodically analyze which aspects of your current financial structure would be eliminated if you were forced to rebuild from zero. These vulnerable elements often represent the greatest barriers to wealth accumulation.
Implement strategic resets without crisis: The wealth-building advantages of bankruptcy can be captured voluntarily through deliberate restructuring of unsustainable obligations without awaiting forced liquidation.
Develop financial skills through artificial constraints: Deliberately operating with self-imposed resource limitations can build the same capabilities bankruptcy survivors develop under pressure.
Audit your financial reference group: Evaluate whether your social and professional networks predominantly model wealth-building behaviors or consumption-oriented patterns.
Practice post-traumatic growth without the trauma: Intentionally reassess material values and financial priorities without requiring actual financial collapse as the catalyst.

The bankruptcy paradox reveals something profound about wealth creation: often the greatest barrier to financial success isn’t external circumstance but embedded patterns in our financial architecture, behavior, and psychology. Bankruptcy forces reconstruction of these elements, creating space for something entirely new to emerge.

This doesn’t mean bankruptcy should be courted as a strategy—the process remains painful, restrictive, and carries significant long-term consequences for many. But understanding why it sometimes creates millionaires helps identify which aspects of our current financial paradigm might be secretly undermining our wealth creation potential.

The most valuable lesson may be this: sometimes what appears to be financial devastation is actually the necessary clearing for unprecedented growth. The question isn’t whether you’ve experienced bankruptcy, but whether you can capture the clarifying power of complete reset without requiring financial collapse to initiate the process.

The Millionaire Janitor: What We Get Wrong About Wealth Building

By Tom Leydiker

On August 2, 2025

In Blog, Debt, Entrepreneurship, Finance, personal, Tom Leydiker

Ronald Read lived an unremarkable life by conventional standards. He worked as a gas station attendant and then a JCPenney janitor in Brattleboro, Vermont. He drove a used Toyota, lived in a modest house, and wore flannel shirts held together with safety pins. His neighbors saw him as the quintessential blue-collar worker, getting by but certainly not thriving in America’s competitive economy.

When Read died in 2014 at age 92, he shocked his community and made national headlines when his estate revealed an $8 million fortune. The janitor had outperformed most professional investors through decades of disciplined saving and simple, consistent investing in blue-chip dividend stocks.

Read’s story isn’t an anomaly. It exemplifies a pattern repeated across countless “secret millionaires” who build substantial wealth despite modest incomes—a pattern that contradicts nearly everything our culture teaches about wealth accumulation.

Our financial media ecosystem bombards us with messages suggesting wealth comes from:

Discovering the next hot investment opportunity
Implementing sophisticated investment strategies
Following charismatic financial gurus
Timing market cycles
Pursuing high-status, high-income careers
Leveraging debt to accelerate wealth building

Yet the empirical evidence reveals a different reality. Analysis of first-generation millionaires consistently shows that sustainable wealth typically comes from:

Extreme Savings Rates While financial advisors typically recommend saving 10-15% of income, most self-made millionaires with modest incomes save 30-50%. This dramatically outweighs investment return differences over time.

Consider this mathematical reality: Someone earning $50,000 annually who saves 50% will accumulate more wealth than someone earning $100,000 who saves 10%, regardless of investment returns. The savings rate is the dominant variable in the wealth equation for most income levels.

Extended Time Horizons The true secret of Read and others like him isn’t market-beating returns—it’s extraordinary patience. He invested consistently for over 65 years, allowing compounding to work its full mathematical magic.

At a 10% average annual return, $1,000 becomes $1,610 after 5 years—not particularly impressive. But that same $1,000 grows to $117,390 after 50 years. The wealth creation happens in the later decades, yet most investors focus exclusively on short-term results.

Lifestyle Stability Perhaps the most overlooked aspect of wealth building is resistance to lifestyle inflation. Secret millionaires typically maintain stable living standards regardless of income increases, creating an expanding gap between earnings and expenses that accelerates wealth accumulation.

This pattern appears consistently in research on first-generation wealth builders. While their income might increase 3-5 times over a career, their core lifestyle expenses often rise only 20-30%, with the difference flowing directly into investments.

Investment Simplicity Contrary to the financial industry’s emphasis on sophistication, most self-made millionaires with modest incomes utilize remarkably simple investment approaches—often basic index funds or diversified blue-chip stocks held for decades with minimal trading.

This simplicity confers significant advantages: lower costs, fewer behavioral mistakes, reduced tax consequences, and minimal time commitment. The mathematical advantage of this approach compounds over time, particularly when combined with high savings rates.

Identity Independence Perhaps most fundamentally, financial overachievers like Read separate their identity and social status from their consumption patterns. They remain indifferent to the implied social hierarchy of brands, experiences, and possessions that drive much discretionary spending.

This psychological independence creates immense financial leverage. By redirecting status-seeking expenses toward investments, they effectively convert zero-return social positioning into wealth-generating assets.

The most profound aspect of Read’s story isn’t how he invested, but how these principles worked synergistically. His high savings rate meant substantial capital deployment. His simple, low-cost investment approach minimized drags on performance. His extended time horizon allowed full compounding. His lifestyle stability prevented wealth leakage. His psychological independence from consumption-based status protected his strategy from social pressures.

None of these principles required exceptional intelligence, insider knowledge, or statistical outlier income. They required something simultaneously simpler and more difficult: behavioral consistency that defied prevailing cultural norms over decades.

This reality presents both challenge and opportunity. The challenge: wealth building for most people isn’t primarily a knowledge problem but a behavior problem. The opportunity: true wealth remains accessible regardless of income level or professional status for those willing to adopt counter-cultural financial patterns.

Financial education that focuses exclusively on investment tactics while ignoring these behavioral foundations addresses the least important aspects of wealth building for most people. It’s equivalent to teaching advanced piano theory to someone who hasn’t yet developed the discipline to practice scales—technically accurate but practically irrelevant.

The financial services industry has limited incentive to emphasize these realities. There’s minimal profit in advising people to save half their income, ignore financial media, invest simply, and hold forever. The business model depends on activity, complexity, and continuous engagement—precisely what successful wealth builders like Read typically avoid.

Perhaps the most empowering aspect of Read’s story is how it democratizes wealth building. The janitor with an eighth-grade education outperformed most PhDs on Wall Street not through privileged knowledge but through behavioral advantage. That same opportunity remains available to anyone willing to embrace similar principles.

The question isn’t whether you can build wealth—Read and countless others have demonstrated that’s possible from nearly any starting point. The question is whether you’re willing to adopt the behaviors that make it inevitable.

Emotional Investing: Why Your Feelings Are Your Portfolio’s Worst Enemy

By Tom Leydiker

On June 1, 2025

In Blog, Debt, Entrepreneurship, personal, Tom Leydiker

When Mark, a typically rational software engineer, liquidated his entire retirement portfolio in March 2020 as the pandemic crashed markets worldwide, he wasn’t making a calculated financial decision. He was responding to a primal emotional impulse—fear. By the time he cautiously reentered the market eight months later, he had missed a 45% recovery rally, potentially costing him hundreds of thousands in long-term retirement funds.

Mark’s story isn’t unusual. It represents one of the most well-documented yet persistently ignored realities in finance: our emotions are often our portfolio’s worst enemy, systematically undermining returns through predictable psychological patterns that feel rational in the moment but prove devastating over time.

The data tells a sobering story. While the S&P 500 delivered an average annual return of 10.2% from 2001-2020, the average equity fund investor earned just 5.4% annually during the same period. This gap—often called the “behavior gap”—represents the massive cost of emotional decision-making. That seemingly small difference compounds dramatically: $10,000 growing at 10.2% for 30 years becomes $180,000, while the same amount growing at 5.4% reaches only $48,000.

Why does this persistent gap exist despite widespread financial education? The answer lies in the mismatch between our evolutionary psychology and modern financial markets.

Our brains evolved to detect patterns, seek safety, and respond quickly to threats—traits that served our ancestors well when avoiding predators but create systematic errors in financial contexts. Several emotional patterns consistently sabotage investor returns:

Loss Aversion: Psychological research shows we feel the pain of losses approximately twice as intensely as the pleasure of equivalent gains. This asymmetry creates a powerful bias toward avoiding losses rather than maximizing gains, often leading to selling promising investments after short-term declines while holding underperforming assets that never recover.

Recency Bias: We instinctively overweight recent events when making predictions, causing us to project current trends indefinitely into the future. This explains both panic selling during downturns and irrational exuberance during bull markets, with investors consistently buying high and selling low—the opposite of successful investing strategy.

Confirmation Bias: Once we form an investment thesis, we naturally seek information confirming our existing beliefs while discounting contradictory data. This creates dangerous blindspots, like ignoring fundamental weakness in beloved stocks or dismissing genuine opportunities that don’t match our narrative.

Herd Mentality: As social creatures, we find comfort in group consensus and instinctively fear isolation. This manifests financially as performance chasing—investing in whatever performed well recently because “everyone else is doing it”—typically ensuring entry at peak prices just before reversals.

Overconfidence: Multiple studies show that 74% of drivers consider themselves above-average—a statistical impossibility. This same overconfidence appears in investing, with individuals consistently overestimating their ability to pick winners, time markets, and evaluate information better than others.

The financial industry, whether deliberately or not, exploits these psychological vulnerabilities. Media headlines amplify emotional triggers with apocalyptic scenarios during downturns and euphoric projections during upswings. Investment platforms gamify trading, encouraging frequent activity despite overwhelming evidence that higher trading frequency correlates with lower returns. Even well-meaning financial advisors sometimes reinforce emotional biases to retain clients rather than challenging flawed thinking.

Recognizing these emotional patterns is necessary but insufficient for improvement. The most successful investors implement systematic countermeasures that specifically target emotional vulnerabilities:

Automated Investment Systems: Pre-commitment to regular investment regardless of market conditions, removing emotional decision points entirely
Investment Policy Statements: Written guidelines establishing rules for buying, selling, and rebalancing before emotional situations arise
Decision Journals: Documenting investment rationales and expected outcomes to enable objective review of decision quality separate from outcomes
Media Diets: Deliberately limiting exposure to financial news, particularly during market extremes
Designated Decision Days: Scheduling portfolio reviews at regular intervals rather than responding to market events
Strategic Accountability: Partnering with advisors specifically tasked with challenging emotional decisions

These mechanisms create distance between immediate emotions and investment actions, allowing rational analysis to override emotional impulses. The investors who implement such systems consistently outperform their peers—not because they’re smarter or more knowledgeable, but because they’re better at managing their psychological vulnerabilities.

Perhaps the most powerful approach involves reframing market volatility entirely. Rather than viewing market declines as threats to be avoided, disciplined investors recognize them as natural features of functioning markets that create opportunity. This perspective shift transforms the emotional experience of investing from fear to cautious optimism.

The ultimate irony is that investment success requires us to act counterintuitively—buying when our instincts scream “danger” and maintaining discipline when everything feels safe. This psychological challenge, more than any technical knowledge of finance, separates successful investors from the perpetually disappointed.

As Warren Buffett famously observed, “The most important quality for an investor is temperament, not intellect.” The investors who recognize and manage their emotional responses don’t just achieve better financial outcomes—they experience less stress, greater confidence, and more consistent progress toward their goals.

The question isn’t whether emotions will influence your investing—they will. The question is whether you’ll let them operate unchecked or implement systems to harness their energy while protecting yourself from their worst excesses. Your financial future may depend on the answer.

The Silent Wealth Killers: Everyday Financial Drains You’re Ignoring

By Tom Leydiker

On May 4, 2025

In Blog, Debt, Entrepreneurship, Finance, personal, Tom Leydiker

In the pursuit of financial independence, we often focus on the grand strategies—investing in the right stocks, maximizing our 401(k) contributions, or hunting for the perfect real estate opportunity. Yet while we’re occupied with these big-picture moves, insidious wealth killers operate quietly in the background, draining our financial potential one small transaction at a time.

These silent wealth killers aren’t dramatic or obvious. They’re the financial equivalent of a slow leak—barely noticeable in isolation but devastating in aggregate. What makes them particularly dangerous is how easily they disguise themselves as normal, acceptable parts of modern financial life.

Consider the subscription creep phenomenon. What begins as a single streaming service gradually expands into a portfolio of monthly subscriptions—streaming video, music, news, productivity apps, meal kits, clothing boxes, and specialized services for every interest. Individually, each might seem reasonable at $9.99 or $14.99 per month. Collectively, they can silently extract hundreds of dollars monthly from your accounts.

A recent financial behavior study found that the average American vastly underestimates their subscription spending by 143%. When asked to estimate monthly subscription costs, most participants guessed around $80, while their actual spending averaged $193. That’s a $1,356 annual difference between perception and reality.

Equally pernicious is the banking fee ecosystem that most consumers have been conditioned to accept. Maintenance fees, ATM charges, overdraft penalties, foreign transaction surcharges, and wire transfer costs aren’t just annoying financial speed bumps—they’re systematic wealth transfers from your accounts to financial institutions. The average American household pays $329 annually in bank fees, with that figure nearly doubling for those who occasionally overdraft.

Consider this stark reality: $329 invested annually for 30 years at a modest 7% return would grow to approximately $33,000. That’s a decent car or a significant portion of a college education, sacrificed to fees that could be largely avoided through more attentive financial management.

Perhaps the most insidious wealth killer lurks in our everyday shopping habits. The convenience premium—paying significantly more for essentially the same products or services due to laziness, poor planning, or status-seeking—silently erodes wealth building potential. This manifests as:

Paying 300% markup for coffee shop visits versus brewing at home
Last-minute grocery shopping at convenience stores versus planned trips to lower-cost supermarkets
Impulse purchases triggered by strategic store layouts and digital marketing
Brand loyalty without price comparison
Delivery fees and surcharges for minor conveniences

The financial impact of these convenience choices compounds dramatically over time. Someone who spends $5 daily on coffee shop visits versus $0.50 for home-brewed coffee isn’t just spending $4.50 extra daily—they’re sacrificing over $46,000 across 20 years, assuming that money had been invested with modest returns.

Impulse purchasing presents another particularly dangerous wealth killer because it operates at the intersection of emotion and sophisticated marketing science. Retailers and online platforms have perfected psychological triggers that bypass rational decision-making, leading to unplanned spending that feels good momentarily but creates no lasting value.

The average American makes three impulse purchases weekly, totaling approximately $5,400 annually. For perspective, that’s enough to fully fund a Roth IRA for most eligible participants, potentially growing to $500,000 or more over a 30-year career with consistent contributions.

These wealth killers share a common trait: they rely on financial autopilot—the tendency to make recurring financial decisions with minimal conscious thought. Breaking free requires developing systems that introduce friction and consciousness into these transactions:

Conduct a subscription audit quarterly, requiring each service to justify its continued cost
Configure automatic alerts for any transaction under $20, bringing consciousness to small purchases
Implement a 24-hour rule for non-essential purchases
Switch to financial institutions that minimize or eliminate common fees
Pre-commit to specific shopping parameters before entering stores or browsing online
Calculate the “true hourly cost” of convenience purchases (your hourly wage versus time saved)

Perhaps most importantly, recognize that these wealth killers aren’t just financial issues—they’re often manifestations of deeper psychological patterns. The person who consistently pays convenience premiums may be overvaluing their time or avoiding discomfort. The subscription hoarder might be seeking identity validation through consumption. The impulse shopper could be using purchases as emotional regulation.

Addressing these underlying patterns often yields benefits beyond financial improvement. Many people report greater overall satisfaction when they reduce unconscious spending, as it typically leads to more intentional choices aligned with deeper values.

The battle against wealth killers isn’t about deprivation—it’s about consciousness. By bringing awareness to these silent drains and implementing systems to manage them, you reclaim not just money but agency over your financial future. And unlike many financial strategies that require substantial capital to implement, fighting wealth killers is accessible to everyone, regardless of income or net worth.

What silent wealth killers are operating in your financial life right now? The answer might reveal your greatest opportunity for financial transformation.

Applying For A Small Business Loan

By Tom Leydiker

On July 23, 2019

In Blog, Entrepreneurship, Finance

Achieving your vision for your small business requires substantial preparation and funds. Capital is highly needed in establishing the small business as well as financing its initial stages of operation before the business realizes financial stability. It is, therefore, highly recommendable to consider applying for a small business loan. The process of applying for the loan involves five simple steps, which, once correctly followed, will highly likely increase your chances of success.

Evaluating Your Needs

The first thing to do before applying for a small business loan is to assess your small business’ needs, mainly focusing on why you need to obtain the loan. Most small business loan requirements fall into four main categories. These include the need to finance the startup process of your business, catering for day-to-day expenses within the business, achieving and realizing business growth, and having a financial safety cushion for your business.

Determining The Right Type of Loan

The second step involves deciding the correct type of loan that your business needs. Depending on the need you want to fulfill in your business, there are different types of business loans and sources of capital for small businesses available in the market. Among those include, loans offered by the Small Business Administration, business line of credit, invoice financing, personal loans, merchant cash advance, and micro-loans.

Choosing The Right Small Business Lender

The third step in the process involves selecting a suitable small business lender. The market is awash with multiple small business lenders, including banks, micro-lending institutions, online lenders, and government institutions. When choosing the right small business lender, you should emphasize on determining the minimum requirements and the annual percentage rate of the loan offered.

Establish If You Are Qualified

After choosing the right lender for your small business, you should then move to determine whether you are eligible for a loan with the institution of your choice. Among the crucial factors that determine your eligibility for a small business loan include your credit score, your business’s financial profile or history, and the business’s internal asset-base.

Gathering The Documents And Applying

The last step involves obtaining the necessary documents that are required for your business to qualify for the loan. Among the critical documents that different lending institutions need include business and personal tax return certificates, bank statements, financial statements, and legal documents.

The Difference Between Index Funds and ETFs

By Tom Leydiker

On July 9, 2019

In Blog, Finance, personal

When it comes to investing, there are a number of terms to learn in order to be conversant and knowledgeable as an investor. There are margin calls, options and mutual funds. A couple of terms that are important to learn when investing are index funds and ETFs.

What Are Index Funds?

Index funds are a form of mutual fund. A mutual fund is a basket of stocks that is actively managed to attempt to maximize investor returns through effective diversification. An index fund is a mutual fund that is more passively managed, and it will attempt to match a given index. The index could be the S&P 500, the Russell 2000 or another index altogether. There are also bond index funds available.

Index funds will not generally beat the market, but they will usually come close to meeting the market’s overall return. Index funds will tend to have less turnover than an actively managed fund. This will mean that index funds have a relatively high level of tax efficiency. Index funds will also usually pay out dividends as the underlying companies that make up the index pay dividends. As a form of mutual funds, index funds will only trade at the end of the trading day. Therefore, an individual investor will have little ability to maximize her ability to take advantage of little price fluctuations.

What Are ETFs?

Exchange traded funds, more commonly known as ETFs are also baskets of stocks. A brokerage might have a mutual fund and an ETF with very similar goals and holdings. Investors can trade ETFs more easily than regular mutual funds. Unlike mutual funds that trade only at the end of the trading day, ETFs can trade like stocks. As long as the market is open, an investor can buy or sell an ETF. This allows investors to take advantage of fluctuations in the price more easily. Like mutual funds, ETFs will also pay periodic dividend to investors.

Another difference between index funds and ETFs is the amount needed to invest. Mutual funds usually require a larger initial investment. Most will require an investment of $1,000 or $3,000 as the cost of being able to invest. ETFs allow smaller investors to get started more quickly. It’s only necessary to purchase a single share of an ETF to begin investing. This is another layer of flexibility that’s related to investing in ETFs.

Investing For New College Graduates

By Tom Leydiker

On June 7, 2019

In Blog, Debt, Entrepreneurship, Finance

Recent college grads are known for the massive amounts of debt they’ve taken on. They go to school for four or more years, and they hopefully have a degree to go with their nice monthly bill. Investing is usually one of the last things on the minds of recent college grads. Yet, because of the ability of money to grow into massive amounts the longer it’s invested, immediately after college is the best time to start investing. Here are a couple of great ways new college graduates can get started investing.

Smartphone Apps

It may seem like a smartphone app would be a strange place to start investing, but nothing could be further from the truth. Recent apps like Stash and Acorns allow investors to automatically save small amounts of money without much in the way of forethought. Stash allows for regular or periodic investments taken from a bank account. Both Stash and Acorns allow would-be investors to round up purchases and save the spare change in an investment account. Stash has a broader array of investments available while Acorns focuses on just a few funds that are intended to meet certain goals based upon a new grad’s risk profile.

Workplace Retirement Plans

Another great option that is open to many new grads who have jobs is a workplace retirement plan. These are great options because they offer tax-deferred savings. This means that new grads will pay less in taxes, which also means they will keep more of their money to pay off student loan debt while saving. Another great benefit of saving in a work-based retirement plan like a 401(k) is the matching funds that employers will frequently offer. Through workplace 401(k) matching funds, it’s possible to supercharge returns with no additional effort. Many employers will offer a dollar-for-dollar match up to a certain percentage of an employee’s pay. A common percentage is 6 percent. With a dollar-for-dollar match, an employee would effectively be savings 12 percent of his or her salary each year while only cutting their pay by 6 percent.

Even with student loan debt, it is not impossible to save for retirement. Through apps like Stash or Acorns and workplace retirement plans that allow for automatic savings, new grads can begin building their nest eggs. The perfect time to get started is the present.

Franchising Your Business

By Tom Leydiker

On January 4, 2019

In Blog, Entrepreneurship, Finance

Once a business has a certain process that’s working and it is producing a consistent profit, an owner may want to think about replicating the process by franchising the business and opening it up to new owners. Here are five factors that a company will want to look at when deciding if they should create a franchise:

Is The Concept Viable?

A good franchise concept will have two qualities. It will offer something that is familiar, but it will come with a unique twist. An excellent example of this is a pizza company that only offers organic ingredients and delivers their product via hybrid-electric vehicles. The concept must appeal to prospective franchisees and consumers. Also, the business should be able to be replicated so that funding more of them would create an increase in profits and economies of scale.

Hire A Lawyer

When a business owner is going through the franchising process, it’s important to hire an attorney who can give expert advice on the transition. They’ll be able to help with the forms that need to be completed such as a Franchise Disclosure Document. An attorney will also be able to assist with pricing, intellectual property protection and the creation of a franchise agreement.

Will Cloning Work?

To really be sure that a business should be franchised, it’s usually best to create one or more clones and see if they are successful in other areas. If the cloned units are a success, it probably makes sense to move ahead with plans to franchise the business.

Be Selective

There are many individuals who may have the capital to pay the price that allows them to get involved with a franchise. However, it’s important for the owner of the franchise to be selective when choosing franchisees. This ensures that the right people are selected so that both the franchise owner and franchisees are successful. The owner of a franchise should always consider new franchisees as ambassadors of their brand. They must be a good fit. An interview process should be used to help determine the best candidates.

Location Location Location

One of the most important factors for the success of a franchise is where it is located. It’s best if the first couple of locations are kept close to the original business. However, they shouldn’t be so close that they’ll hurt the sales of the first location. By having the first franchise operations close, it will be easier to manage logistics.

Attracting The Right Set Of Investors

By Tom Leydiker

On November 26, 2018

In Blog, Finance

When a person is able to find a good investor for their startup, it will help them get off to a good start. Knowing how to pitch and attract investors will ensure that they find the right match. Here are five tips that will help an individual give a strong pitch to an investor:

Short And SweetInn

Often, the best ideas are the simple ones. When a person is creating their pitch, it should be short and sweet. Of course, their products or services need to be innovative as well.

It’s best to stay away from technical details when a first pitch is given. Typically, an investor will have experience in the space and quickly understand the significance of the proposition being made. It’s also best to keep minor details about the company private before an investor decides to sign on.

Telling A Story

Storytelling is one of the best ways to pitch to an investor. People love stories, and they’ve been successfully used for thousands of years to pique people’s interest and get them emotionally involved.

The key is to make a story enjoyable and not too convoluted. A person can use the story to help make them more likable, which can help build trust.

Utilize Philanthropy

In many cases, investors have been involved in some type of entrepreneurial role in their business life, and typically, entrepreneurs are more likely to donate to charities.

It feels great when a person is charitable, and it makes them look good. By aligning a business plan with some type of charity during the initial stages of a business, it sets up the possibility of networking with investors who view giving to charity as a positive thing to do.

Use Confidence And Practice

When a person acts confident when they’re giving a pitch, it’s going to help an investor see them as someone who is sure of themselves. This helps create trust and confidence in an investor.

It will probably take time for a beginner to find the correct balance of aggressiveness. They definitely don’t want to come off as someone who is desperate.

Sealing The Final Deal
Once a person has given their pitch and become established as a trustworthy and accessible individual, it may help if they can prove that it works. If an investor sees that their service or product is actually viable, it should help the investor make a decision.