3 Things 8-5-24
Thing One
Three Good Ideas
The following are three things you should consider doing to save/earn money. We found them in an article on thepennyhoarder.com. They are actually from a longer list of things, but in keeping with this newsletter’s title, we’ve narrowed it down to a hat trick.
“…Cancel Your Car Insurance
You might not even realize it, but your car insurance company is probably overcharging you. In fact, they’re kind of counting on you not noticing. Luckily, this problem is easy to fix.
Don’t waste your time browsing insurance sites for a better deal. A company called Insurify shows you all your options at once — people who do this save up to $996 per year.
If you tell them a bit about yourself and your vehicle, they’ll send you personalized quotes so you can compare them and find the best one for you.
Tired of overpaying for car insurance? It takes just five minutes to compare your options with Insurify and see how much you could save on car insurance...
… Stop Paying Your Credit Card Company
If you have credit card debt, you know. The anxiety, the interest rates, the fear you’re never going to escape…
And the truth is, your credit card company doesn’t really care. It’s just getting rich by ripping you off with high interest rates — some up to 36%. But a website called AmOne wants to help.
If you owe your credit card companies $100,000 or less, AmOne will match you with a low-interest loan you can use to pay off every single one of your balances.
The benefit? You’ll be left with one bill to pay each month. And because personal loans have lower interest rates (AmOne rates start at 6.40% APR), you’ll get out of debt that much faster. Plus: No credit card payment this month.
You don’t need a perfect credit score to get a loan — and comparing your options won’t affect your score at all. Plus, AmOne keeps your information confidential and secure, which is probably why after 20 years in business, it still has an A+ rating with the Better Business Bureau.
It takes less than a minute and just 10 questions to see what loans you qualify for — you don’t even need to enter your Social Security number. You do need to give AmOne a real phone number in order to qualify, but don’t worry — they won’t spam you with phone calls.
… Get Up to $300 Just for Setting Up Direct Deposit With This Account
If you bank at a traditional brick-and-mortar bank, your money probably isn’t growing much (c’mon, 0.40% is basically nothing).
But there’s good news: With SoFi Checking and Savings (member FDIC), you stand to gain up to a hefty 4.60% APY on savings when you set up a direct deposit or have $5,000 or more in Qualifying Deposits and 0.50% APY on checking balances2 — savings APY is 10 times more than the national average.
Right now, a direct deposit of at least $1K not only sets you up for higher returns but also brings you closer to earning up to a $300 welcome bonus (terms apply).
You can easily deposit checks via your phone’s camera, transfer funds, and get customer service via chat or phone call. There are no account fees, no monthly fees and no overdraft fees.* And your money is FDIC insured (up to $2M of additional FDIC insurance through the SoFi Insured Deposit Program).
It’s quick and easy to open an account with SoFi Checking and Savings (member FDIC) and watch your money grow faster than ever…”
Thing Two
DCA Is Still The Way
Given the stock market’s recent swoon, we thought it might be appropriate to share some wisdom from our archives. The following was written by a dear friend and mentor over a decade ago but it is as relevant now as it was when he originally shared it.
“Dollar cost averaging is absolutely the right approach for long term investors. It refers to investing a set amount of money at regular intervals, regardless of whether the market is going up or down. It's a great way to invest "unemotionally" and is generally what happens with 401k investing. The recent article How to beat the market without even trying makes the case very well for an automatic and regular approach to investing. As suggested, while dollar cost averaging may be boring, it delivers solid results, and that's what matters.
When investing, boring is good. So are solid results over time.
Another article which discusses successfully acquiring the funds necessary to meet our retirement needs is 3 Biggest Drivers of Retirement Savings Success. Aligned with the advice contained in the article cited hereinabove, a disciplined approach to savings and investing is recommended.
One perhaps somewhat surprising fact is that upon reaching retirement, those people most prepared financially and those least prepared financially to meet their retirement needs earned approximately the same income. Thus, the broader point is simply that it isn't how much money we earn, but what we do with those earnings with respect to savings. What matters most is developing the habit of saving enough money routinely and then investing those savings through a dollar cost averaging or similar technique.
In sum, the market's historical tendency is to appreciate at rates of return well above the rate of inflation. However, the short term market is dominated by traders and not investors. Hence, on a daily basis stocks frequently move up and down in a volatile manner. An emotional roller coaster ride, if you're a trader. That's because the market is as likely to go down as up on any day, week or month, or even any given hour of any given day. News headlines or events du jour are usually the daily drivers.
So what's a long term investor, as opposed to a short term trader, supposed to do? Relax and employ the automatic and unemotional dollar cost averaging approach to long term successful investing.
Here's the heart of the matter. The only two points in time the price of the stock is critical are when it's bought and later when it's sold. That spread between the buy and the sell price, and that spread alone, will determine the realized profitability of the investment.
Psychologically, people experience more pain due to loss than than they experience joy with gain. This is especially true with "unrealized losses" when the market declines. Thus, emotions often have an undue influence over what individuals choose to do or not to do, as the case may be. Buffett says that while in the short run the market is a voting machine, in the long run it's a weighing machine. Companies are worth what they are able to earn over time. Nothing complicated about that.
In a nutshell, dollar cost averaging makes sense. It takes the short term emotion out of the investing decision. We buy regularly no matter what direction the market is heading, what the news headlines may be or what the "experts" may be saying at that particular time.
For some inexplicable reason, stock purchases are often an exception to the common sense rule that people like to buy things on sale. I've never understood that. My guess is it's attributable to fear and anxiety, and that acquiring financial knowledge about how markets work would go a long way toward helping individuals sleep well and also achieve successful financial security over time. We simply haven't acquired the general knowledge necessary for what I'll call "comfortable investing". We don't need investing expertise as such. We just need to know generally how things work and why they work that way. As we come to know the basics, that knowledge will help us achieve our long term financial goals.
We Americans are very much in need of a demystification process when it comes to markets, capitalism, education, governments and freedom.”
Thing Three
Just A Thought
“A comfort zone is a beautiful place, but nothing ever grows there.” - Unknown
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