• Home
  • About
  • Advertise
  • Contact
  • Policy
  • Guest Post
  • Archive

One Cent At A Time

A Personal finance blog to get rich

  • Email
  • Facebook
  • Pinterest
  • RSS
  • Twitter
  • Beautiful Life
  • Becoming Rich
  • Beginners Guide
  • Extra Income
  • Productivity
  • Saving Money

Shepherd And Sheep herder, Story About Your Money

June 5, 2011 4 Comments

Share this:

  • Tweet
  • Email

Have you ever seen a shepherd or a sheep herder? A shepherd knows his sheep, he can distinguish one from another, though, to us all look the same. He understands their individual needs, giving different treatments to different sheep and there by make them follow him.

 

 

This is a story told by my leader at work, he once visited rural Colorado, and closely watched a shepherd and a sheep herder. As he narrated, that shepherd boy spoke to his sheep, he knew which sheep to control and which sheep to let loose, even if at times those sheep were a bit way-ward. He conversed with his folks, in different tones and frequencies. He was fully aware of each one of his 500 odd sheep. He could tell which one is sick, which one has injury.

A sheep herder, on contrary, looked in to his sheep as a mass, he had his dogs to help me keeping the order, he was always yelling and shouting to control them. He was ferocious in his task of discipline.

My leader narrated the story in context of leadership, to impart the importance of knowing and caring the people we lead as against of dominating them.

To me, the story is equally relevant to our money. Your money is your own resource, working for you, working for your future needs, comfort and, may be power. You want to hold on to it, the question is by being a shepherd or a sheep herder?

If we think the contrast of behaviors between the two, it is obvious that the sheep herder works and earns his money by taking the sheep to grazing and safely returning them back to the owner.

A shepherd, on the other hand, earns his money and living by selling their wool and probably selling his sheep for meat, he raises his sheep, he breeds them, he takes care of them. Sheep obey their keeper on their own, not out of fear.

How this story applies to your money?

Simply putting, we all need to be a shepherd to our money. Your professional certified adviser is nothing but a sheep herder. He probably knows better than you on various investing strategies, he had seen many investment successes and failures in the past, way more than you did.

It’s advisable to seek a financial adviser’s help time to time, but your need, your wage, your priorities and the market conditions change too often to hire an expert every time.  But your money deserves shepherd’s treatment!

To maximize your money’s potential, you need to keep up with it. You should know everything about each one of them. If you had invested in a mutual fund, you need to know how the MF is doing in this market, you need to know main constituents of the fund, whether the companies still makes good profits. You need to know what is latest Morningstar rating of the fund, you need time to analyze fund’s past performance as well.

You can’t fully utilize money’s potential unless you are aware of these things. Because, only when you are informed about all these, you can make decision to buy more or sell of or hold on to that particular investment.

Even if your investment is doing great, you should still look at its competitors, are they doing better? I had a savings account with HSBC, but I got better rate from American Express, I switched my entire amount over to AMEX. I still, am looking for even better rates than what AMEX is giving to me.

Start with understanding what you need to manage about your money

The very first step is to know where you are and where you want to go. I put together few tentative points, every one should consider to start with in their money management journey.

  • Determine your Net worth. That is, what is the total value of your assets minus the liability towards your creditors
  • Write down how much you want to save, or, how much money you need to become debt free, this should be your goal
  • Determine and list all of your investments, group them by investment type (eg. Mutual Fund, Saving Account, CD etc), use various available tools to help you, most of them are freeware
  • In each group, rank your investments by rate of return

Once you complete these steps, you know where you are and where you want to go with your money. Now, at this point, comes the hardest part, where you should be determining how you will meet your money goals. This is where the skill and experience comes in to play.

Few points on what ideally be your next steps.

  • Once you are done with ranking your investments as per rate of return, carefully scrutinize the bottom listed investment, do you have alternative? If yes, see how much risk is there to put your money in it. Check and recheck for other options. Once you find that, you did a great job!
  • Sometimes we make fundamental mistakes while investing, we over expose our selves in to a particular type of investments, chances are there that yours is one of them. Take help from experts, or, better, your broker’s portfolio analysis tools. Almost all online brokers offer this to their registered users for free. I use Fidelity and TD Ameritrade’s tools to determine the quality of my portfolio mix.
  • Depending on the suggestions/advices you receive, plan your next step, if you are advised to cut exposure to stocks, start doing research on other alternatives. Bonds, Savings accounts or CD might be the way to go. Do your home work, there are plenty of materials available on net to assist you. You can try Google search too. try searching as simple as “Where to invest”, you can’t finish reading all the better reads in probably a week. Internet is such full of resources.
  • Get yourself acquainted with various financial instruments. If you do not know what is an MMA, when you are advised to have an MMA, do some more research, know what is MMA, know what returns you can expect, compare it with your existing returns, then decide whether to opt for MMA or not. Informed decision, sometimes, go wrong, but most of the times they are the correct decisions.
  • Take your time, re shuffle your portfolio only when you are enough convinced to go with it.
  • Calculate what will be your net worth growth rate, after you make all the necessary changes, check if you can achieve your goal in stipulated time frame.
  • If still goal is not achievable, try to save more, also, try to earn more by having your salary raised. Even try to look for a better paying job.
  • If you are in debt, try for a refinance, try to negotiate for a better rate from your creditors.

More money you save, more investment you can make, more secure will be your future and post-retirement life. Remember, in retirement, that steady flow of money through your paycheck won’t be coming!

Unless you know your money now, you will probably have no clue on where your money is going, and where you will be in future, you won’t know where you can pull the strings and prevent the out flow.

when I started putting efforts to understand my financial health, so many ideas on saving money and making it grow at a higher rate started pouring in to my head., that I was really confused where to start and what should be my priority, but now I am in full control of my money.

You don’t need to read for hours on tips and techniques to save money, or invest wisely, all you need to know is how you are spending your every cent., and how your investments are growing. Tips and tricks naturally occurs once you start monitoring your spending and investing patterns.

LIKE THIS POST?
I agree to have my personal information transfered to MailChimp ( more information )
Join our community of 8000+ subscribers to increase your net worth and build wealth
We hate spam. Your email address will not be sold or shared with anyone else.

Share this:

  • Tweet
  • Email
The tool that changed the way I manage my personal finance - Personal Capital, The Best Free Personal Finance Tool

Want to start a WordPress blog now? The onecentatatime.com blog is hosted by Siteground Web Hosting. For only $3.95 a month, Siteground can help you set up and host your website/blog quickly and easily.

About the Blogger Hi I am SB, a personal finance enthusiast with a career in software development. I am an immigrant to the USA since 2005, after being born and brought up in India. This 40 something technocrat lives and breathes personal finance whenever he gets time from the day job, job as a husband and a dad

Some links on this page may be affiliate links, if you make a purchase following the links, I may earn a commission. Read affiliate disclosure here
« Every Day Saving: Tips To Save On Parking Fees
How To Prepare An Annual Budget To Keep Finances In Order »

Comments

  1. Kelly says

    June 11, 2011 at 7:02 PM

    This is invaluable advice – I would never not have a Financial Advisor. She’s a god-send.

    (I *love* this website 🙂

    Reply
    • SB says

      June 13, 2011 at 11:10 PM

      Hey Kelly thanks, idea is not to go after an adviser for everything, decide on your own rather. But you might want to take their advises from time to time, it’s wise decision too.

      Reply
      • Kelly says

        June 14, 2011 at 12:17 AM

        Oh, definitely! Sometimes we come armed to her with stuff we’ve researched and we all go through it together. My husband likes this website, too.

        Reply
  2. Jaundalynn says

    June 22, 2011 at 1:22 PM

    This is exactly what I was looinkg for. Thanks for writing!

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.



Create your own blog in 20 minutes and $20

Personal Capital, a free tool to change your financial health today

I use and suggest Upstart, for your personal loan need

CreditKarma, a free tool to check your credit scorey

I use Coinbase, for my crypto investments

101 Cents at a Time

101 Ways to Earn Extra Money on the Side
201 Frugal and Perfect Birthday Gifts
101 Ways to Save Money Everyday
101 Ways to be Better and Successful at Work
101 Ways to Save Environment and Energy
101 Frugal and Romantic Anniversary Ideas
101 Low-Cost Men's Fashion Ideas
101 Personal Finance Tips
101 Ways to Reuse Household Stuff
101 Things to Do, When Nothing to Do
101 College Graduation Gift Ideas
100 Tips for Ecommerce Startup
101 Ways to Enjoy Indoor During Winter
101 Ways to Beat Procrastination

Popular Posts

Quick Cash - How to make $100 legally, in a day
Living well on less than $15,000 a Year
Top survey sites for side income
What to do when auto repair goes wrong
Where should I invest my money now?
20 Ways to be productive and happy at work
51 Ways to get out of debt
Be a better person in 15 days, 15 ways
Income ideas for retirees and senior citizens
51 side jobs for college students
Urgently need a large amount of money?
Should I buy or should I rent?
Best Personal loan providers
25 Ways to save environment
25 DIY car repairs to save money
How to decorate office cubicle
How to show your wife you care
50 Financial Rules for Success
51 Frugal weekend family activity ideas
Become Rich By Saving 1 Hour Of Daily Wage
How much do I need to save for retirement?
How to negotiate your salary

Follow us on FaceBook

About Author

SB

Blogger by choice and IT manager by profession. Finance is my passion and gardening is my greatest satisfaction. Born in India, settled in US, Husband and a father. I created this blog in 2011 with a vision to help others. Thanks for your patronage. More info on my "about" page.

View all posts


Subscribe

Join our community of 5000+ subscribers to increase net worth and build wealth

Advertisements

Personal Stories

How I got a new HP computer replaced
Was COVID circulating in USA in fall of 2019?
How my credit score went up 800+
Why I didn’t invest in Bitcoins
How I controlled impulses to buy things
Why this blog is named One Cent at a Time

Subscribe via Email

Site Disclaimer

Disclosure of Material Connection: Some of the links in this web site are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising.”
Read full Affiliate disclosure


One Cent at a Time is published by SB. The opinions expressed herein by him are his own and not those of his employer or anyone else. All content on One Cent at a Time is for entertainment purposes only. By reading this blog, you agree that SB and/or One Cent at a Time is not responsible for any actions taken after reading this blog. For the full disclaimer, click here .

Major Media Mention

One Cent at a Time Media Appearances

Copyright © 2023 One Cent At A Time · Designed by Nuts and Bolts Media