Do you really need Life Insurance?

No, seriously, do you really need Life Insurance or not?

Last week I had an interesting conversation with the fellow FIRE blogger – Financial Patriot Blog who wrote on Twitter that he and his family don’t buy Life Insurance

He’s absolutely right. Statistically speaking probability of using life insurance benefits is almost zero; it’s less than 1%

But it’s not so simple.

Insurance in Soviet Russia

Insurance business in Soviet Russia was the government prerogative. There was only one company called Rossgosstrakh which had about 140,000 insurance agents all over the country.

In early 80x, the insurance market in USSR was about 161B Soviet rubles, which is about  $550B. But the way the whole market was structured and gained was typical for USSR.

In Soviet Russia, bears will make sure you work, and you do it hard.

Every Soviet citizen was a government employee, because every organization, factory or a service “company” was the government property. People didn’t have any small business it was criminal activity.

From every paycheck, you would have some mandatory withdrawals. Your trade union had to decide what type of withdrawals (in addition to the taxes) you would have.

My father, who was a coal miner, had these:

  • life insurance
  • health insurance
  • disability insurance
  • trade union fees

Because of these additional mandatory withdrawals, people didn’t like insurance at all, a lot of people used to think that this is unnecessary crap that they have to buy because the government said so.

As a result, I grew up with an impression that all insurance business is a scam.

After Immigration

After our immigration to the States in 2013, I realized one simple thing. It was a revelation to me. We don’t have anyone here.

That was a really hard thing to grasp before the immigration, I know.

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Personal Goals For 2018

Started the new year has © Master Yoda

This is the time of the year where people share their goals, New Year resolutions, and dreams. No, seriously, every FIRE blogger writes about the importance of setting goals and share their New Year resolutions.

And hey, I’m ain’t different by any means. Recently I wrote a post about converting your dreams to your goals.  And today I’d like to write about my personal goals for 2018. It will be easier for me to be more honest with myself about either achieving or failing them, and easier to track them for myself.

Without further ado let me talk about my personal goals.

The Wheel Of Life

Zig Ziglar used to talk about this amazing concept called “The Wheel Of Life”. According to Mr. Ziglar, this wheel has 7 independent areas that inflate separately. In order to have the wheel rolling, you have to maintain every of its area.

Having even one area deflated will cause problems: you will have to spend more energy keeping the pace, or you will have to slow down. The more areas are deflated (not taken care of) the more problem you will have in your life. If you want to have a good and quality life, you have to work on all the 7 areas.

1. Spiritual

Being an evangelical, Bible-believing Christian I believe that Spiritual life is the most important, at least it’s important for me. I am a brand new Christian and still at the beginning of my spiritual life, and these are my goals:

  • Read the Bible every day – What an amazing about it is, people read it for the whole of the life and every time find something new, isn’t it amazing? I strongly believe this book has all the instruction people need and shows us how to live the purposeful and wonderful life.
  • Study 4 books from the New Testament – Reading the Bible is important, but to know and understand the context, the meaning, and historical circumstances is more important. Otherwise, there’s a big chance to follow a wrong doctrine.

2. Social

  • Start a YouTube channel (English) – One of the reasons I started this blog was to improve my Egnlish. I came to the States in May 2013 without speaking any English, and starting this blog was one of the tools I’ve been using to improve my English. After thinking for a while I decided to open a YouTube channel and keep it at least for a year. This channel thing is a huge step out from my comfort zone. I have no idea what I am going to do with this channel, but I know that I HAVE TO do it.
  • Visit a Meetup – this goal is a perfect example of killing two birds with a stone. Visiting meetup(s) I will be able to find new, like-minded friends, and improve my speaking abilities.

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December 2017 Net Worth Update

Disclaimer about our Net Worth
We don’t have any debt, none whatsoever. But we use credit cards to earn some miles and get signup bonuses; we pay the whole balance every month. We own a car and a motorcycle, but we do not include the value of these vehicles in our Net Worth. The same for our kids 529s.

December 2017 Update

What a year it was … Yes, it was great for the FR family, hope your year was great as well. Recently I posted a post review about the year of 2017

How’d you spend your vacation? Was it good? Hope you had a great time because we did.

Lake Tahoe, CA Still don’t understand people who like living in a city

We spent our vacation at the Lake Tahoe, CA What a great place to spend a Christmas vacation. I don’t know about you, but I LOVE mountains, I really do. When I lived in Russia I lived in a place called Sochi – a host of 2014 Winter Olympic Games. Maybe, for this reason, I LOVE Colorado.

Look at this idyll

Mrs. FR and I are planning to move to Colorado in a year. We would’ve moved already but one news made us move our plan for a year. I will write you about this news later 😉

Net Worth Update

Just WOW… Less than 5 years after coming to the States our Net Worth crossed $200,000 milestone and I have to tell you this, the first $200K is a bitch. You can take a look at this screenshot.

First 200K is a bitch

I have no idea what was going on, but Personal Capital made me a hard time

Yearly in December, we were so close to a $200K milestone, but the life happened: our younger daughter had a dental surgery that we had to pay almost $2000 out of pocket.

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2017 Best of The Friendly Russian

The year of 2017 is almost over. What a year it has been…

I started this blog in April 2017 with my very first post From Russian With Love. I had and still have to goals for this blog:

  1. Improve my English
  2. Prove the American Dream is alive

As it usually it happens to me, I started too fast with too ambitious goals. I posted 2-3 times a week. And it worked, but for a short period of time.

bad horse starts fast

A Russian proverb says, “A bad horse starts too fast.” I was that bad horse. And as it usually happens with a bad horse, it started slowing down in the middle of the race. I didn’t have enough time to keep the same pace I chose.

 

As a result, I slowed down from 2-3 posts a week to one post a week, and later to one post a month.

dead horse

Don’t beat a dead horse

Today, as I’m writing this post, I remembered a book I read once to my daughters, “The Tortoise and the Hare” This book has an amazing lesson, you know what?

The Tortoise Always Wins

Remember, the tortoise always wins

This year I learned my lesson, slow and steady…

“SLOW” but the more important part is “STEADY”

I’d like to share with you some stats from 2017. Some of them surprised me, some not…

Top posts from 2017

  1. Net Worth – A series of posts about our family net worth. It’s really great to see how well we did in 2017. And more important it’s really powerful to see and understand that we are really blessed with our income.
  2. First Pay Check in The States – a story about my very first in the States. Don’t know about you, but I keep it and hope, one day, it will become our family heirloom.
  3. A millionaire before 50 – an interview with Menard, a first-generation immigrant who has already reached a great milestone – $1,000,000 Net Worth.
  4. A story about one financial mistake – a year after we came to the States we made a financial mistake that 99.9% Americans make; we financed a car. We learned our lesson, even we regret this purchase.
  5. How to Budget the Russian Way – a budget is a cornerstone of financial success. I was amazed when I realized how many people don’t know what a budget is, and how to budget. And you know what, it’s really easy.
  6. Raising Taxes To Help Poor People – after @ZerroDayFinance in his passive-aggressive voice suggested me to get out from the States I wrote this post where I rant about raising taxes, government and our role in helping people in need.
  7. Convert Your Dreams To Your Goals – I used to have New Year declaration and resolution. It didn’t work. You know what works? Goals work. This is why I wrote this post explaining how to convert your goals to the dreams. I hope this method will you as it helped me.

Looking back at the year of 2017 I have to say one thing, “Our family has been blessed“. We have found many good friends, visited a couple of great places and found out that…. I will tell you later about this great news.

Thank you for staying with me and reading this blog.

Happy New Year.

Don’t forget to subscribe to The Friendly Russian by Email and you will never miss a thing

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Merry Christmas!

Merry Christmas!

Isa 9:6 (KJV)  For unto us a child is born, unto us a son is given: and the government shall be upon his shoulder: and his name shall be called Wonderful, Counsellor, The mighty God, The everlasting Father, The Prince of Peace.


December is the most beautiful time of the year. I just want to wish you and your family a very beautiful Merry Christmas. Spend time with your beloved ones, play with kids, go on a date with your spouse.

But don’t forget about the spirit of the Christmas, it’s all about giving:

Joh 3:16 (KJV)  For God so loved the world, that he gave his only begotten Son, that whosoever believeth in him should not perish, but have everlasting life.

God bless you and Merry Christmas.

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Raising Taxes To Help Poor People

I grew up and lived in a country that preached and practiced communism and socialism. After 30 years of living in that environment, I don’t tolerate two things:

  1. Ignorance
  2. Socialism with communism

more taxes socialism

More Taxes To Help Poor

Recently I’ve had a conversation with a fellow FIRE blogger ZeroDaysFinance about helping poor, free medicine and how people should be taxed more in order to do these good deeds.

When people talk about taxes they go bananas, on both sides of the aisle. I am amazed at how many people lose their ability to do critical thinking due to their political beliefs. I am amazed at that, both on the right and on the left.  This conversation is the perfect example of that.

Government is not a charity.

Let me tell you something really simple and easy.

Taxation is not a charitable act

You don’t need to be left, right, black or white to figure that out. And so to accuse someone who doesn’t want to pay higher taxes as being uncharitable toward poor people is absolutely absurd.

It’s ridiculous.

A charitable act is when someone voluntarily takes money that they have owned and earned, and they give it to someone else.

Let me repeat it again, VOLUNTARILY.

If they do not do that, they don’t go to jail.

If you don’t file your tax returns, it’s a criminal act and you go to jail. Last year about 2,500 people went to jail for failing their tax returns. So, there’s nothing charitable, or loving the poor well about thinking people should be taxed more.

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Convert Your Dreams To Your Goals

Happy December everyone

I love December, the spirit of Christmas is in the air. People are “making the lists and checking ’em twice”. Some people are trying to sum up the year, and some are thinking about the goals for the new year.

But before thinking about the new goals let’s talk about the differences between goals and dreams. Otherwise, you will have dreams and not goals, and dreams stay dreams all the time.

Dreams

We are all dreamers, people dream a lot. Some people dream about money, another dream about becoming famous, and someone (maybe) dream about playing guitar like Steve Vai. People tend to change their dream time to time, and sometimes even the dreams become true. But let’s be honest, most of the dreams remain dreams for the rest of the life. And the main reason for this is this, dreams don’t have the main attributes which are necessary for achievable goals.

Goals

You, probably, heard this saying, “A goal without a plan it’s just a dream”. Using the opposite we can say that a goal is a measurable dream that has a plan for achievement.

“I want to become reach” – is nothing more than a dream, but “I want to have $50,000 in six months” – is a goal. Have you noticed the difference? This goal has a specific value – $50,000 and specific time – six months.

“I want to lose some weight” – nothing more than a wish, a dream. And “I want to gain/lose 10 pounds in 3 months is already a goal.

Do you already notice the huge difference between a wish and a goal? But that’s not all, goals have more attributes; goals have to be SMART. Continue reading

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November 2017 Net Worth Update – $190,335.84

Disclaimer about our Net Worth
We don’t have any debt, none whatsoever. But we use credit cards to earn some miles and get signup bonuses; we pay the whole balance every month. We own a car and a motorcycle, but we do not include the value of these vehicles in our Net Worth. The same for our kids 529s.

November 2017 Update

Welcome to our November 2017 Net Worth update. What a year it has been: a year of changes, challenges, new acquaintances.

In November I had to learn new things, like changing a dead battery on our 2014 Dodge Journey, it was an experience I can tell you this.

I spent about 30 minutes finding where the battery is, and another 45 minutes changing it. Of course, I could’ve spent $150 worth of labor by asking a Dodge service to do the work, but I am too cheap 🙂

Dodge Journey dead battery

Who in the world would place the battery here?

I have to tell you this, I wasn’t the only one replacing the battery. My younger daughter was helping me as well.

See this pinkish shoe? That’s a proof I wasn’t doing this job alone.

After checking the battery she told me, ‘Dad, it’s not that bad. At least it’s showing some numbers.

Look at this happy face, after spending almost 2 hours on the job that could’ve been done in 15-20 minutes. Damn you, Dodge Engineers.

Yes, safety first. Always wear a protective glass on

OK, enough boasting, it’s time for some numbers.

Net Worth Update

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You should teach your kids about money

My primary job as a father is not to raise great kids. My primary job as a father is to raise a great grownup.

When I was growing up money talks weren’t a thing in our house. We didn’t have any financial education, money talks or life lessons from our parents. My brother and I had to learn this subject the hard way. And now being a grownup and having two kids I don’t want to make the same mistakes my parents did. We teach our kids about money and you should too.

kids and money

© https://www.kiplinger.com

Money doesn’t grow on trees” or “Do you think we have a money printer under the bed?” these are the typical examples of money chats parents have with their kids. Too sad, because kids have no idea about what money is, what’s their value, and where the money comes from. And later we get grownups who make the same money mistakes over and over again; or even worse, we have socialists who think they have some kinds of rights to other peoples money.

When to start?

With our kids, we started this “education” process 2 years ago when they were 8 and 4 years old. I don’t believe there’s a minimum age that you should start at. Sooner you start easier it will be later, especially when you lovely “pumpkin” will turn into a small monster for a couple of age (read teenager)

But at the same time be flexible and consider your kids’ age. Don’t explain mutual funds and compound interest to your 4 years old son, you should teach age appropriately.

I believe there are four major principles every parent should teach the kids:

  • You should teach them to work
  • You should teach them to save
  • You should teach them to give
  • You should teach them to spend

That’s it, no less, no more. Four major principles that apply to any person from 4 to 44 years old.

Teach them to work

Money doesn’t grow on trees… Money doesn’t come from Santa nor magically appear in a wallet.

Money comes from work. 

You work, you get your money. You work hard, smart or even both, you get more money. It’s really simple, there’s nothing magic about. And vice versa, you don’t work, you don’t get money. This rule applies to every adult person, and you know what? The same simple rule applies to kids as well. You should teach them that money comes from work.

At our house we don’t have allowances, we have chores and we pay our kids for running these chores. Continue reading

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October 2017 Net Worth Update – $179,134.40

Disclaimer about our Net Worth
We don’t have any debt, none whatsoever. We don’t use any credit cards anymore –  cash and a debit card only. We own a car and a motorcycle, but we do not include the value of these vehicles in our Net Worth. The same is true for our kids 529s.

You know, I love this time of the year. The crazy season at my work is almost done and the new year is not far off, you can relax a little bit and think. Think about your achievement, what needs to be achieved and start thinking about your plans and goals for the coming year.

No, seriously, if you think about it, it’s already November. A couple of weeks later people in the State will eat turkey and you can’t blink an eye and it’ll be Christmass time. Times flies, it really does.

Think about this… You only get about 30,000 sunrises in your life, at least for most of the people. 23,725 are spent growing up and working… You’ve got about 6,275 sunrises left for things that count. ENJOY EVERY DAY. DO SOMETHING WITH YOUR LIFE THAT MATTERS @RussianFriendly

In October I finally jumped on my motorcycle (thanks to my wife) and took Hwy-1, one of the best scenic road I’ve seen in my life. I will write a post about this small adventure and how Google Maps screwed me.

Rocky Creek Bridge, Hwy-1

This Russian is so rude, he even photobombed an awesome Rocky Creek Bridge

Awesome views, if you ever visit California, take this road, you will not regret.

OK, back to the business and let us check the numbers.

Yay, $15,561.46 increase since the last month.

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