Illumination Wealth August 2014: The Real Value of 5 Minutes

August 5, 2014
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How’s it going?

Happy August! We hope you are making the most of your summer but recognize the precious value in each minute of it. In this edition, we have some very timely insights that you can intelligently apply in your financial life.

Here’s what’s lighting up in our newsletter version of a financial fireworks show:

  • The Real Value of 5 Minutes
  • Illumination’s Media Spotlight: Financially Intelligent Insights
  • The Market Scoreboard for July 2014


The Real Value of 5 Minutes

“A little time can help you to make a great impact, therefore you should never despise a few minutes.” – Israelmore Ayivor

5 Minutes. Three Hundred Seconds. One Twelfth of 1 hour. It doesn’t sound like much does it?

We’ll I have news for you. 5 minutes are invaluable when it comes to your health and building wealth.

A recent study as reported in the Journal of American College of Cardiology found that people who ran or jogged for as little as five minutes a day lived three years longer than non-runners. Let that sink in for a second. 5 minutes per day of a healthy habit can add years to your life.

The consistent, accumulated compound effect of 5 minutes of a healthy daily activity can make a profound positive impact in your financial life. It’s true that health and wealth are unique to each person. However, the both are deeply impacted by science, math, time and personal factors within our own control.

Let’s explore how your financial life can be significantly improved in 5 minutes per day:

1. Spend 5 Minutes Per Day Reading and Growing Your Financial Intelligence

If building wealth is a goal, then developing a habit of studying wealth building should be front and center. Reading for 5 minutes per day will allow you to complete one book every two months. After two years, that will be 12 new books that you have read. As Charlie Munger said, “I’ve known no wise person over a broad subject matter area who didn’t read all the time – none, zero.” After two years, you will have read more books on personal finance, investing and wealth building than the average financial service professional.

The sooner you learn financially intelligent lessons, the lower the costs in terms of your financial mistakes. Contributing regularly to your financial education will compound your financial intelligence just like how running for 5 minutes per day adds to your health, vitality and longevity.

2. Spend 5 Minutes a Day Finding Ways to Save $5

$5 per day probably doesn’t sound like much but this is the “Latte Factor” as coined by David Bach. There is a reason why Starbucks is wealthy and you may not be. They are accumulating your wealth building soldiers. Every dollar that leaves your pocket for consumption removes $5 per day at 5% interest over 40 years is $232,000.

Keep in mind that you could invest your savings to pay off high interest rate debt or earn even great rates of return than the 5% we illustrated. Eventually, your will be able to increase your $5/day savings to $10, then to $20.

3. Spend 5 Minutes Per Day Reviewing Your Financial Goals

Imagine if you and / or your significant other sat down each day and discussed your financial goals and had a real conversation about money.  Many people avoid these conversations all together because they are complex and emotional subjects. It’s far too important to ignore. Money problems (or communication problems surrounding money) are one of the biggest contributing factors when it comes to divorce. Think about how your relationship with your significant other could improve by talking about what really matters to you and your financial life.

Staying present to your goals will allow you to adjust and adapt to the inevitable curve-balls that will be thrown your way. It will help eliminate the big surprises and help your proactively prepare for all that you want to accomplish.  If you and your loved ones are prepared for the changes before they occur, you will be in a strong position to handle them and benefit from them.

4. Spend 5 Minutes Per Day Organizing Your Financial Life

A great many of money problems are caused by disorganization. Your may be one of the many people with retirement accounts and savings accounts strewn about at different places – from old 401(k)’s , to investment accounts at different brokerage firms to multiple bank accounts at a multitude of banks. Spend some time consolidating your accounts and find a service that will allow you to view them in totality. Automate your savings and your bill payment so your financial life can be operating no matter where you are or what you are doing. Spending a minimal amount of time organizing your life will allow you to spend the rest of your life doing what’s most important.

There you have it. In 5 minutes per day, that’s it,  you can dramatically improve your financial intelligence, save hundreds of thousands of dollars, improve your relationship with your loved ones and money itself, accelerate your progress towards reaching your financial life goals and increase the amount of time you can devote to the things you actually value the most.

It’s been said that that time is money. But I side with Jim Rohn: “Time is more important than money. You can get more money, but you can’t get more time.” Spend your time wisely.

Action Items:

  • Schedule 5 Minutes In Your Calendar – A recurring appointment for you to dedicate time to improving your financial life.
  • Pick one book to start reading incrementally – 5 minutes a day.


Illumination’s Media Spotlight

Here’s our monthly compilation of interesting articles and videos designed to keep you informed and engaged in the areas of personal finance, the economy and life. We hope you enjoy this month’s edition. Please send us your thoughts on this month’s articles and suggestions for future posts.

Our Appearances

YoPro Wealth: The Ultimate Guide to Becoming Debt-Free

Prince’s Daily Journal: An Interview on Entrepreneurship

Personal Finance

CNN: Smart people buy generic brands

Success: The Success Guide to Happiness


Success Magazine: A Day in the Life of Jimmy Kimmel

Great Videos, Podcasts & TED Talks

Eventual Millionaire: Creating an 8 Figure Business at 24 Years old at with Nathan Latka


Market Scoreboard

Here is the market scoreboard for July 2014:

July Market Scoreboard Pic

Notes: S&P 500, MSCI World Index ex US, Gold, DJ-UBS Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; the DJ Equity All REIT TR Index does include reinvested dividends; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.

Sources: Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.

As you can see from the chart above, July was not a positive month for most asset classes. U.S. stocks, Foreign Stocks, Commodities, Real Estate and Gold all declined. Equities across the globe fell 2% except for the emerging markets which actually rallied on the heels of a strong move in China.

This past week was the worst weekly decline for the U.S. stock market since May of 2012. To provide some further context surrounding the move, the S&P 500 has declined only 3% from its recent peak and this is coming off 5 straight months of gains. It’s also notable that the S&P 500 has not had a 10% decline since early 2012…that’s over 2 years without any substantial decline and 23 months out of the last 27 with a gain.

Despite the unusual positive stretch of market history as of late, when everything is seemingly good (stock market at highs, housing market gains, job market gains) it is just the time to expect things to not be as smooth going forward. William Bernstein recently said in his recent book If Your Can,  market history shows that when there’s economic blue sky, future (stock market) returns are low, and when the economy is on the skids, future returns are high; it is a truism in the market that the best fishing is done in the most stormy waters.

One anecdotal piece of evidence of such market participant optimism comes from the Bank of America Merrill Lynch’s Fund Manager’s Survey in July. It said that fund manager equity weightings increased to +61% overweight. This is the highest since the intermediate term market peak in February 2011 and second highest reading since 2001. In the past, when fund managers were this positively positioned in stocks, future market returns were most often negative in the near future. You have been forewarned.

Trending Graph

That said, it doesn’t mean one needs to fear another great recession. Market corrections are normal and healthy. They serve to remove the excess that have built up in the recent past and provide opportunity ahead.

It’s also interesting to note that Bull Markets (such as the one we have been in since 2009) usually don’t end with long monthly win streaks. Every gain since 1982 of at least 5 months in a row was always followed by a higher high. The worst such outcome was a choppy, sideways market for several months. Anyone fearing a market crash should note that this would be completely out of character from prior stock market tops.  It’s still important to be aware that all major market indices remain in positive long-term trends despite the recent decline.


As Ross Levin recently said in his Star Tribune column, “if you’re prepared for the economic changes before they occur, you’ll be in a position to benefit from them. Use periods like this to make your mark rather than to be marked on.”


Congrats to our friend Bari Levine for her successful episode of House Hunters in Chicago on HGTV.

Kudos to our friend Dianne Shain on her promotion to Advisory & Assurance Manager at Cox Enterprises in Atlanta.

Have a wonderful last month of your summer vacation and make a little time for your financial life. It will be time well spent.

All the Best,

Matt & The Illumination Wealth Team

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The opinions and forecasts expressed are those of Matt Rinkey, President of Illumination Wealth Management (IWM) and may not actually come to pass. Mr. Rinkey’s opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security or Illumination Wealth services. No part of this material is intended as an investment recommendation. Neither the information nor any opinion expressed constitutes a solicitation to purchase or sell securities or any of IWM’s services. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that investment objectives outlined will actually come to pass. Investors should consult an Investment Professional before investing in any investment program. Neither Mr. Rinkey or Illumination Wealth nor any of their employees shall have any liability for any loss sustained by anyone who has relied on the information contained herein. Entities including, but not limited to IWM, its officers, directors, employees, customers and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. The analysis contained is based on both technical and fundamental research. Although the information contain is derived from sources which are believed to be reliable, they cannot be guaranteed. Past performance is never a guarantee of future results.