REAL Assets...

[Norri]

Thanks for all the great advice, Alta

My passion is the reason I'm doing all this investing -- so I can have time and money to study without trying to feed us at the same time. My passion is guitar and music in general.

The investments I'm talking about aren't restricted to the stock markets or anything like that.

Can we focus this thread on systems-based investments that work? I'm a systems guy, been programming for maybe 9 years now -- systems are easy for me. Perhaps we can start a separate thread based on following your passion. I could sure do with any advice I can get but I don't want to derail the brainstorming on this thread.

[Alta Murray]

Let me try again, we are having conneco problems today sigh. Slapped wrists for me sorry to veer off topic, but on this forum I have noticed that it is okay to steer off topic or is that just me?

We have all been were you are right now, short of cash, trying to make ends meet, so I do feel very sorry for you. Do I ever remember the days?

No, sorry, I can not try and figure out business ideas if I don't know from whence you come, easy reason bein that you will work harder when its something that you like and feel passionate about.

Programming for 9 years? What language, what type of systems? Something must be wrong if you have not made some good money from your current skill, please advise.

Virgin Day One : Woke up this morning and desperately wished that there was some site some forum some anything that will supply me with a menu for b/fast, sschool and uni lunches, lunch and dinner plus the shopping list. Healthy meals that are relatively quick to prepare. One can even order(index) it in cheap, middle-class and the connoiseur(I don't even know how to spell that so that ought to make me cheap) classes. Most women work nowadays, so it becomes a real pain to think what are we having for dinner ugh!! I find that with a menu I am better prepared, and don;t mind it so much, but to go through the supplies and think up something is such a bloody bother. I had a housekeeper at one stage, and she did all of that for me, what a blessing, but she got sick and I could never find someone to fill her shoes. Also important that my daughter actually *see* me doin some cooking as she and Bonita believed that white women don't cook yikes! No role model there and I know for a fact that woman struggle with this issue. Perhaps u can check to see if it is out there already? That is a real, real need.

What did you find?

[IanF]

Well, for one I think Ian, do the math! If you can find the property in the right area, you pay off your loan at a cheaper rate than your rent!! And there is something else -- the time value of money to take into account when it comes to owning your own business premises, it might seem terribly expensive at first, but as time value increases the monatory value decreases, and the value of the property increases. If you can sub-let you are in.

Oh, and I checked out your accounting package, though I couldn't see what it looks like, apart from the fact that it seems to be for a small business, I can tell you this : If you are happy, and it does what you want it to do, you are set. The price is very reasonable, so I hope you stay happy!

As for numbering accounts -- you just click on a button and you can be on names only, but it is a very bad practise, and I will break any student or programmer working for me if they dare go without unique numbers.

Alta
Thanks for the reply, I am a reformed accountant who decided against the corporate world eventually.
I must start looking around as it may be the right time now, just my target area around Sandton/Rosebank the prices are high.
On the accounting package why I don't like account numbers is that they are inflexible if you want to sort by them. I still remember in the 80s being told of the magic of relational database compared to a normal database. The package I use does use have account numbers which are sequentially and allocated when you open a new account. From some one who hates doing accounts it works great for me, and I know my bank has reconciled. When I get bored, easy when doing bookkeeping I go dyslexic and you can imagine the hassles this causes with account numbers.
Why do accounts packages still need sequential numbering for account numbers when you can sort on any field?
Hopefully I can further my knowledge here.
Ian (now a RA)

[Alta Murray]

You asked for it You do for ex. if statements on your numbers to determine what figures you are working with, for ex if ACCNO.Value < 1000 AND ACCNO.Value > 800 then.... doesn't work so lekker on a string I Find also it prevents duplicates, for ex MUR001 and MUR002 for two Murray clients or creditors blah-blah...very easy to allocate no automatically, so it's not a problem. Importing bank statements easy too, but your normal way of doing it the system posts it automatically, so you just have to put in bank costs, that's all. You can still do it according to name and skip the no. hassle.

Relational databases are the shit, so you heard right. You can sort on any field irrespective of whether it's relational dbf's or not, you can even sort on mulitple fields, so you get a better picture of the file you are sorting, but that has got nothing to do with relational databases.

A relational database means there is a relation between certain fields with another database for ex and this is a -- hold your breath--- a real live example form my system.

Figures->NO;Name and then the relation with CashBal->NO;Name, the rest of the fields then differ, but Figures have a relation with the first file Company and yes you guessed it NO;Name fields. Then what you do is to filter your records and you don't use SQL for it sucks and voila!

An Accountant? I love accountants, they always seem to be so precise & they have such a bookish air about them. Just love that, so why did you quit, it's a cool job.

I hate doing accounting by the way, I think it sucks and mine is never ever up to date. And to think that accounting is based on algebra and developed by a monk. Yeah, right I would get bored too being celibate, so I have sworn at the poor monk many a time.
I only love analysis They shoul dhave kept it at algebra!

I have just finished with cash flow and I absolutely hated doing it, comprises of
Sales and Cash Collections (predictions in relation to sales blah blah)
Cash Collections
Cash Disbursements
Net Cash Inflow
Cash Balance
All with graphs.

Now I am onto the last bit of my system which is the cost of financing.

Oh, how come I thought you were down in Durbs? Ouch for your area, it is pricey, but like you say it might just be the right time now to buy.

I hope you understand your relational dbf now as you shall be taking an on-line exam shortly

Alta ( Now a CSD)

[Norri]

No, sorry, I can not try and figure out business ideas if I don't know from whence you come, easy reason bein that you will work harder when its something that you like and feel passionate about.

And I agree but I'm not looking for a business to LIVE in but a business to set up, systemise and enjoy the proceeds from. Read Michael Gerber's "The E-Myth Revisited". That's what I'm aiming for but on a much smaller scale (for now).

Programming for 9 years? What language, what type of systems? Something must be wrong if you have not made some good money from your current skill, please advise.

I've made lots of money programming. I just haven't done a particularly good job of keeping that money

Also, I prefer more freedom in my work than what programming for others normally allows. So, ideally, I'd like to reserve that skill for myself and my partners.

[Dave A]

Can we focus this thread on systems-based investments that work?

... sorry to veer off topic, but on this forum I have noticed that it is okay to steer off topic or is that just me?

It tends to wander back on-topic after a while - sometimes

I'm trying to keep things low touch and splitting threads can make things disjointed.

I was going to post somewhere along the way (may as well get it in now) that the problem with buying your own commercial property is the fairly high barrier to entry - generally banks will only finance 75%, which leaves a fair gap to fill from elsewhere.

I'm wondering in a more general way about that issue of barriers to entry when it comes to building "Real Assets" as per Robert Kiyosaki's definition. Can an asset sustain a high income stream if it has a low barrier to entry?

[Norri]

Can an asset sustain a high income stream if it has a low barrier to entry?

I would reckon not. But let's keep in mind that the financial barrier isn't the only barrier to entry. There's skill (technical, industry-specific, etc), time (to get it working, etc), and so on. There's always something out there that can be done on a low budget and eventually grown into something substantial.

Also, I would argue (sorry Dave ) that the goal doesn't necessarily have to be a high income stream. It can be any income stream, provided that the income is greater than the sum of the expenses. If you've achieved THAT and can duplicate your results, you have sustainable growth.

[Dave A]

We're thinking along similar lines... but here is the catch.

If the barrier is skill and you hope to duplicate your way up to better income, the skill has to be transfered. And doing that and keeping it in your system isn't as simple as you might think.

[Norri]

We're thinking along similar lines... but here is the catch.

If the barrier is skill and you hope to duplicate your way up to better income, the skill has to be transfered. And doing that and keeping it in your system isn't as simple as you might think.

I totally understand what you're saying here but my plan is a leetle more weekid

The idea is that I can use my skill(s) to build a system that makes me money. And then use other people who lack skills to run that system. ie: Affordable people

[Alta Murray]

True, but it depends on the industry, and Ian don't have to buy a commercial property where as you would have to, however, it is still a better option than putting your pennies in someone else's pocket, just do the math. If it is possible in your industry to do so, I would highly recommend it. We have 3 big clients in hydraulics who own their own properties, granted two of the three are second generation businesses, but the 3rd played it very smart and obtained his own property. Clever move, and all he did was to keep on doing the math, and check I am not going off topic, he obtained a fixed asset to generate the needed income. You can only do things like that it you have a holistic view of your business and you have the ability to do drill-down projections though. Capital outlay on fixed assets can not strangle the business, so it takes some time before you enter the break-even phase, so you have to take that into account. Life span of fixed asset too, for it will be a sad day if you break-even only then to replace the fixed asset at an expense again

Barriers are sometimes erected by people in a specific industry, and those are very difficult to scale.

High risk:= High return has held true for centuries now, so perhaps there is some wisdom in that. The only element I could find to pull that equation out of sync, is to have a product that is completely new, and time becomes an element with incrimental growth as a result as opposed to high risk. Being the first brings its own risks, but it can not be termed high risk.

Norri, I would love to do some more reading, but I have literally a stack of books I am working through at this stage, so it will have to wait, but I will try and find the gist of it along the lines. I remain a steadfast Caincross fan though, nothing much has changed since it's conception.

Sustainable growth? Mmmm.....too many elements impacting on that scenario, so I will never work on that as a given, no constant in that for me, but you might differ?

As for passing skills etc. on and keeping it as your own, that is easy as far as I am concerned. Intellectual property is protected and that is why we have lawyers.