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Tour de Personal Finance, Stage 13, Round 3 – Posts 33-40
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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Without further ado, let’s continue on with the 13th Stage (the 3rd Round of competition!) of the 2012 My Personal Finance Journey Tour de Personal Finance (to follow all of the action, click on the Tour de Personal Finance category link and scroll down to read all the posts involved in this subject).
AN IMPORTANT UPDATE ON PRIZES FOR THE COMPETITION
- Prize to Yellow Jersey Winner – $75.00
- Amount that will be given to a charity chosen by the Yellow Jersey Winner – $123.05
- Prize to 2nd place podium finisher – $50.00
To view the most up-to-date brackets of the competition, click the following link – 2012 Tour de PF Bracket.
Also, if applicable, I will give a brief description of the stage of the Tour de France that took place the same day as (or that has happened since the previous Stage of) the competition.
HOW TO VOTE
You can vote for the one article (one from the one intermediate sprint in the case of today’s Stage) you’d like to see proceed in the Tour by commenting in the comments section below and telling which are your favorites.
I’ve listed a keyword after each post title to make it easy to vote (as a made-up example, you can just comment: Sprint 1: Mutual, etc.) Be sure to comment which one you like the best out of each set of two! Criteria for the best article is completely up to you, but you can use these factors as a guide: 1) post of your favorite blogger, 2) most interesting post, 3) most thought-provoking post, 4) most unique post, or 5) most actionable post.
Here are today’s competitions:
Voting will continue until July 16th for this Stage!
INTERMEDIATE SPRINT # 1
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The Value of Work (Work): You won’t get the same props (or paycheck) for vacuuming an apartment building as you would for performing open-heart surgery. But, that doesn’t mean a janitorial job is demeaning. It just means we don’t have the sense to appreciate it.
- Realising the Sacrifices Our Parents Made (Parents): Recently, when I saw a hitch hiker, I remembered my dad hitch hiking to work practically every day. I thought it was normal, but now realise that no, my parents sacrificed a lot for us kids. There is so much we can learn from how frugally they lived, although I couldn’t hitch hike!
TOUR DE FRANCE DAILY RECAP
***Photo courtesy of http://www.flickr.com/photos/37117644@N00/1126323036/sizes/m/in/photostream/
Tour de Personal Finance, Stage 12, Round 3 – Posts 17-32
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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Without further ado, let’s continue on with the 12th Stage (the first Stage of the 3rd Round of competition!) of the 2012 My Personal Finance Journey Tour de Personal Finance (to follow all of the action, click on the Tour de Personal Finance category link and scroll down to read all the posts involved in this subject).
AN IMPORTANT UPDATE ON PRIZES FOR THE COMPETITION
- Prize to Yellow Jersey Winner – $75.00
- Amount that will be given to a charity chosen by the Yellow Jersey Winner – $123.05
- Prize to 2nd place podium finisher – $50.00
To view the most up-to-date brackets of the competition, click the following link – 2012 Tour de PF Bracket.
Also, if applicable, I will give a brief description of the stage of the Tour de France that took place the same day as (or that has happened since the previous Stage of) the competition.
HOW TO VOTE
You can vote for the two articles (one from each intermediate sprint) you’d like to see proceed in the Tour by commenting in the comments section below and telling which are your favorites.
I’ve listed a keyword after each post title to make it easy to vote (as a made-up example, you can just comment: Sprint 1: Mutual; Sprint 2: 401k, etc.) Be sure to comment which one you like the best out of each set of two! Criteria for the best article is completely up to you, but you can use these factors as a guide: 1) post of your favorite blogger, 2) most interesting post, 3) most thought-provoking post, 4) most unique post, or 5) most actionable post.
Here are today’s competitions (Sprints 1 and 2 of Stage 12 went live earlier today, so be sure to cast your vote for that as well!):
Voting will continue until July 15th for this Stage!
INTERMEDIATE SPRINT # 3
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How Far Would You Go To Pick Up a Penny? (Penny): Most of us love free money, but how far would you go to pick some up? Would it matter who you were around, or how dirty the coins/dollars were? What if they were on the bathroom floor? These are all questions I pondered at a bachelor party recently… figured better that than some other things 😉
- Should You Charge Your Boomerang Kids Rent? (Boomerang): It’s no longer a given that kids will move out on their own when college ends. In fact, there’s a term for this group – Boomerang Kids. Should you charge rent to these boomerang kids?
INTERMEDIATE SPRINT # 4
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Online Poker: Is It as Legit as Stock Picking? (Poker): There are those that believe stock picking is a lot like gambling — and those that believe online poker is a safer bet than stock picking. Could online poker be as legit as picking stocks?
- Key to Saving Money is Controlling Impulse Spending (Spending): Have you gone to the grocery store for milk and eggs and come home with steak and eggs? Have you ever been tempted to buy something just because it was on sale? Impulse spending can wreck your finances and is a major reason why most people have difficulty saving money. Learning why you buy on impulse can be the key to saving more money.
TOUR DE FRANCE DAILY RECAP
In the finish, British rider, David Millar, took out the sprint ahead of the breakaway. This was his 4th career Stage win in the Tour de France. All of the contenders for overall victory finished together in the main pack, so there were no changes to the overall standings. British rider, Bradley Wiggins remains in the yellow jersey.
***Photo courtesy of http://www.flickr.com/photos/epsos/3530836012/sizes/l/in/photostream/
Tour de Personal Finance, Stage 12, Round 3 – Posts 1-16
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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
————————————————————————————————————————
Without further ado, let’s continue on with the 12th Stage (the first Stage of the 3rd Round of competition!) of the 2012 My Personal Finance Journey Tour de Personal Finance (to follow all of the action, click on the Tour de Personal Finance category link and scroll down to read all the posts involved in this subject).
AN IMPORTANT UPDATE ON PRIZES FOR THE COMPETITION
- Prize to Yellow Jersey Winner – $75.00
- Amount that will be given to a charity chosen by the Yellow Jersey Winner – $123.05
- Prize to 2nd place podium finisher – $50.00
To view the most up-to-date brackets of the competition, click the following link – 2012 Tour de PF Bracket.
Also, if applicable, I will give a brief description of the stage of the Tour de France that took place the same day as (or that has happened since the previous Stage of) the competition.
HOW TO VOTE
You can vote for the two articles (one from each intermediate sprint) you’d like to see proceed in the Tour by commenting in the comments section below and telling which are your favorites.
I’ve listed a keyword after each post title to make it easy to vote (as a made-up example, you can just comment: Sprint 1: Mutual; Sprint 2: 401k, etc.) Be sure to comment which one you like the best out of each set of two! Criteria for the best article is completely up to you, but you can use these factors as a guide: 1) post of your favorite blogger, 2) most interesting post, 3) most thought-provoking post, 4) most unique post, or 5) most actionable post.
Here are today’s competitions (Sprints 3 and 4 of Stage 12 will go live later today, so be sure to cast your vote for that as well!):
Voting will continue until July 15th for this Stage!
INTERMEDIATE SPRINT # 1
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Pay Off Mortgage Early or Invest– The Complete Guide (Mortgage): Should I pay off my mortgage early or invest? Forget the dangerous half-truths and over-simplified conventional wisdom about getting out of debt. Instead, learn the many dimensions to paying off your mortgage early in this complete guide so you can make a smart financial decision that perfectly fits your personal situation.
- How to Retire Early (Retire): Here are the core principles and action items that can help you become financially successful, and retire sooner. I know, because I became financially independent and retired at age 50. I found that financial success is made up of one part family support, one part career choices, one part money management, and one part personal habits and attitudes. It’s not a quick or easy process, but there are definitely things you can do to accelerate your progress….”
INTERMEDIATE SPRINT # 2
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How to Be a Conservative Investor (Investor): In a volatile stock market, people are always looking for ways to protect their money. Unfortunately, that often means getting too conservative and letting it sit in the bank earning little or no interest. Instead, I’ll show you how to be a true conservative investor and make real money, safely, in even a difficult economy.
- 7 Financial Advisors I Would Like to Punch in the Face (Punch): There are plenty of financial advisors in my industry that give financial planning a bad name (Madoff anyone?), and unfortunately they’re everywhere. I’ve been in the business for almost 10 years, and I’ve had countless run-ins with these types of advisors and despite my laid back personality, I would like nothing more than to punch them in the face, seriously. Here are some financial advisor horror stories that other clients have shared with me, the lessons learned, and let’s just see if you would want to pull a Rocky Balboa on their face, too.
TOUR DE FRANCE DAILY RECAP
***Photo courtesy of http://www.flickr.com/photos/ichihara-hanpu/3884392776/sizes/o/in/photostream/
Is it Cheaper to Use Coin Laundry or Install Your Own Washer and Dryer?
Ever since I purchased my condominium in the Summer of 2010, one of my ‘grand plans’ was to upgrade the place by installing a stacked washer/dryer combination unit into one of the closets in the living room. I figured that this would be a nice convenience to have while living there during graduate school, as well as boost the value of the property when I looked to sell in a few years down the road.
Having decided to take on this upgrade, I made saving for the eventual project one of my financial goals and figured I would start accumulating the money after I had saved up the 1% home value cash fund for home maintenance costs that are generally recommended to have. I calculated that the upgrade would cost $1000 for the washer/dryer and an additional $1000 for labor/installation (since installing the unit in the closet would involve drilling holes and placing pipes).
However, after I had completed saving for my 1% home value maintenance account, I decided to cancel the financial goal of installing the washer/dryer unit because my girlfriend was going to move into my place, and we knew we would desperately be needing the storage space that the target closet represented!
While I definitely still feel that reserving the extra closet for miscellaneous storage was the correct decision, the process got me thinking – are the operating expenses actually cheaper if you install your own washer/dryer in your home versus using the coin-operated laundry that our condo community provides?
Trying to find an answer to this question is the purpose of this post. Let’s get started!
Analysis Assumptions
As always, when we start with an analysis, it’s important to list out the assumptions that we’ll use so that everyone is on the same page. These are listed below:
- In my condo complex, the only relevant utility that I have to pay separately from the fixed Homeowner’s Association fee is electricity. So, that’s the only operating cost that will be considered in this analysis for figuring the cost of having my own washer/dryer.
- Cost of my time to walk down the row of condos to the community washer/dryers is negligible, so not included.
- I get quarters to operate the coin-laundry from my bank on the way to work, so there is no added cost to obtain those.
- Maintenance costs are negligible for keeping up the washer/dryer installed in my condo (which might actually be considerable in real life).
- Assume that I will be doing 2 loads of laundry each week and that the washer/dryer installed in my condo has the same capacity as the community laundry.
- Inflation is not taken into consideration for cost increases for doing coin laundry (which might actually be considerable in real life).
Cost to Operate Coin-Laundry
Washing and drying clothes at my condo’s community laundry facility cost $1.50 each. Of course, this equates to $3.00 total for each load of clothes washed.
Applying the washing frequency of 2 loads per week, this equates to $6.00 per week or $24.00 per month.
Cost to Operate Washer/Dryer Installed in My Condo
As I mentioned previously, the total purchase and installation cost I estimated for the stacked washer/dryer combination was $2000.
Aside from this initial cash outlay, the only other operating cost we need to tabulate is the electricity cost per month. When I started searching for an estimate for this value, I soon discovered that there was a great deal of variability in how much people/companies think that washer/dryers cost to operate each year. Below are some of the various figures I found:
- According to a washer/dryer calculator I found, the total cost to wash and dry my laundry in cold water would be $68 per year.
- According to EnergyStar, their energy-efficient washer/dryers cost $60 per year in electricity.
- According to NPR, a washer/dryer cost a total of $10 to operate each month in electricity, or $120 per year.
- According to the yellow energy tags listed on several washer/dryer combos on Lowe’s website (1, 2, 3, 4), the electricity cost ranges from $19-$32 per year.
Breakeven Analysis & Conclusions – Coin-Operated Washer and Dryer vs. Installed in Home
Using the specifics mentioned above, I calculated that it would take 143 months, or almost 12 years of doing coin-operated laundry in order to spend as much as it would to purchase and subsequently operate a washer/dryer that is installed in my condo. If you’re interested in viewing the spreadsheet that I used to calculate this breakeven time period, click on the Google Docs link below:
Google Docs Spreadsheet – Is it Cheaper to do Coin Laundry or Install Washer Dryer in Your Home?
To me, this is quite an amazing realization! I guess I always figured that it would take several years of doing coin laundry to breakeven on the cost of a washer/dryer, but I definitely didn’t think that it would be >10 years for my specific situation! I figured that it would be more like 3-5 years max!
I think that the aspects of my personal situation that tilted the numbers to heavily favor coin laundry being the cheaper option in (at least) the short-term are as follows:
- 1) Only doing 2 loads per week maximum (whereas a family of 4 might be doing 7-8 loads per week or so), and
- 2) The fact that my condo unit is not currently drilled to handle a washer/dryer, and I would need to spend another $1000 for the labor and materials to make that happen.
In fact, if I had been doing 8 loads of laundry per week and my house was already hard-wired with outlets for a washer/dryer (i.e. the initial cash outlay was only $1000 to purchase the machine), it would have only taken about 12 months for me to break even with the cost of installing a washer/dryer. This really highlights to the importance of doing your own analysis for your specific situation to determine whether or not installing a washer/dryer or just doing coin-laundry is better for you financially.
In addition, it is also worthwhile to note that installing a washer/dryer in your home can sometimes substantially increase the resale value of your home. I can’t remember how many people (girls, in particular), who have told me that they would not EVEN THINK about buying a house or condo unless it had it’s own washer/dryer in it already. By installing this set of appliances in your home, I could see the resale value easily being increased by anywhere up to $5,000, just stemming from the fact that it would be on more people’s ‘list of qualifying homes’ since it has the requisite washer/dryer that they are looking for.
Conclusions
From this analysis, I feel that several important conclusions can be drawn about whether coin laundry or installing your own washer/dryer is cheaper:
- Doing coin-operated laundry will be cheaper and probably a better idea for you if….
- You only do 1-2 loads of laundry a week (or less).
- Installing a washer/dryer in your home would require a substantial capital investment up-front.
- The Time Value of Money (TVM) is of great importance for you, and you don’t want to tie up big chunks of your money for several years that could have been invested elsewhere.
- Installing a washer/dryer in your own home is a good idea for you if….
- You and your family do A LOT of laundry each week (4 loads or more).
- You especially value your time and need the convenience of doing laundry in your own home while you do other things.
- Your home is already equipped with hook-ups for a washer and dryer, and all you have to do is go down to your local home-improvement store to pick one out.
A Spreadsheet Template to Conduct Your Own Washer/Dryer Breakeven Analysis
When I started this analysis, I did not intend to create a general spreadsheet that could be used as a template for conducting someone’s own breakeven.
However, when I saw how sensitive the decision of whether or not it is cheaper to do coin laundry or install your own washer/dryer is to each person’s laundry-going frequency and home set-up, I felt it would add a lot of value to create a tool that could be adjusted by each person to conduct their own analysis.
As such, I added 4 fields highlighted in orange to the Google Docs spreadsheet shown at the link below:
Google Docs Spreadsheet – Is it Cheaper to do Coin Laundry or Install Washer Dryer in Your Home?
The 4 fields include:
- Cost to Purchase and Install a Washer/Dyer in Your Home
- Utility Cost Per Month to Operate a Washer/Dryer Installed in Your Home
- Loads Per Week of Laundry You Will be Doing
- Cost Per Load to Wash + Dry Your Clothes (Total for both washing and drying)
To conduct your own breakeven analysis and help determine which option is cheaper for you in the long-term, simply download a copy of the Google Docs Spreadsheet, input your specific answers to each of these items in the orange cells, and then look in Columns B and C to see how many months it takes for the columns to display similar values (your breakeven point).
The answer may surprise you, like it did me! Give it a shot and let me know how it goes!
How about you all? Do you currently do your laundry using coin machines, or do you have a washer/dryer installed in your home? Have you ever calculated which is cheaper for your specific clothes washing habits?
Is cost even a factor in deciding which route you take with washing your clothes, or is convenience the main deciding point?
Share your experiences by commenting below!
PS – Isn’t the English language fascinating? Drier and dryer sound exactly the same, but one is used as a noun, and one is used as an adjective. Apparently, I may have used the word, dryer, too much today! haha
***Photo courtesy of http://www.flickr.com/photos/xand83/5510923960/sizes/o/in/photostream/
Tour de Personal Finance, Stage 11, Round 2 – Posts 49-52
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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Without further ado, let’s continue on with the 11th Stage (the last Stage of the 2nd Round of competition!) of the 2012 My Personal Finance Journey Tour de Personal Finance (to follow all of the action, click on the Tour de Personal Finance category link and scroll down to read all the posts involved in this subject).
AN IMPORTANT UPDATE ON PRIZES FOR THE COMPETITION
- Prize to Yellow Jersey Winner – $75.00
- Amount that will be given to a charity chosen by the Yellow Jersey Winner – $123.05
- Prize to 2nd place podium finisher – $50.00
To view the most up-to-date brackets of the competition, click the following link – 2012 Tour de PF Bracket.
Also, if applicable, I will give a brief description of the stage of the Tour de France that took place the same day as (or that has happened since the previous Stage of) the competition.
HOW TO VOTE
You can vote for the one articles (one from the single intermediate sprint in this case) you’d like to see proceed in the Tour by commenting in the comments section below and telling which are your favorites.
I’ve listed a keyword after each post title to make it easy to vote (as a made-up example, you can just comment: Sprint 1: Mutual, etc.) Be sure to comment which one you like the best out of each set of two! Criteria for the best article is completely up to you, but you can use these factors as a guide: 1) post of your favorite blogger, 2) most interesting post, 3) most thought-provoking post, 4) most unique post, or 5) most actionable post.
Here are today’s competitions (Sprints 1-2 of Stage 11 went live earlier today, so be sure to cast your vote for those as well!):
Voting will continue until July 14th for this Stage!
INTERMEDIATE SPRINT # 3
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Are You Living Within Your Means? (Living): Do you constantly find yourself using your credit card to pay for basic expenses? Do you ever tell yourself “no” before making a purchase? These are classic signs of living outside of your means. In recent years, many of us have had to learn the hard way, there always comes a time when debt catches up with us. A good way to avoid debt overload is to live within your means. Simply put, you purchase things you can afford based on your current income. Read this post to learn the signs of living outside of your means and ways to get on the right financial path!
- How I Save $828 Dollars A Year On My Phone Bill (Phone): As an addict to savings, my phone bill was an obvious place to do some digging. What I found was a lot of extra money in my pocket, and that good things get better. These are 4 of the biggest Moola Savings Tips to save on that ugly phone bill.
TOUR DE FRANCE DAILY RECAP
In the finish, the amazing young Frenchmen, Pierre Roland, took out the win after launching a decisive breakaway 11 km out on the last climb of the day. Cadel Evans really cracked on the final climb, and is now down to 4th overall. Bradley Wiggins remains in the yellow jersey. My money is on him to take out the overall win in Paris.
***Photo courtesy of http://www.flickr.com/photos/troye/6219621253/sizes/l/in/photostream/
Tour de Personal Finance, Stage 11, Round 2 – Posts 41-48
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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
————————————————————————————————————————
Without further ado, let’s continue on with the 11th Stage (the last Stage of the 2nd Round of competition!) of the 2012 My Personal Finance Journey Tour de Personal Finance (to follow all of the action, click on the Tour de Personal Finance category link and scroll down to read all the posts involved in this subject).
AN IMPORTANT UPDATE ON PRIZES FOR THE COMPETITION
- Prize to Yellow Jersey Winner – $75.00
- Amount that will be given to a charity chosen by the Yellow Jersey Winner – $123.05
- Prize to 2nd place podium finisher – $50.00
To view the most up-to-date brackets of the competition, click the following link – 2012 Tour de PF Bracket.
Also, if applicable, I will give a brief description of the stage of the Tour de France that took place the same day as (or that has happened since the previous Stage of) the competition.
HOW TO VOTE
You can vote for the two articles (one from each intermediate sprint) you’d like to see proceed in the Tour by commenting in the comments section below and telling which are your favorites.
I’ve listed a keyword after each post title to make it easy to vote (as a made-up example, you can just comment: Sprint 1: Mutual; Sprint 2: 401k, etc.) Be sure to comment which one you like the best out of each set of two! Criteria for the best article is completely up to you, but you can use these factors as a guide: 1) post of your favorite blogger, 2) most interesting post, 3) most thought-provoking post, 4) most unique post, or 5) most actionable post.
Here are today’s competitions (Sprint 3 of Stage 11 will go live later today, so be sure to cast your vote for that as well!):
Voting will continue until July 14th for this Stage!
INTERMEDIATE SPRINT # 1
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Advice for Twenty-Somethings Getting Started Managing Money (Twenty): A concise, easy to understand, and most of all, ENCOURAGING note to my fellow twenty-somethings on how to manage their finances. For a generation that grew up to watch the Tech Boom of the Nineties collapse during the Tech Bubble Burst and who saw the Great Recession hit right as they were entering the real world, there’s been an unfortunate trend towards avoiding investing or any other sort of risk, right at the time when they can most afford to take MORE risk. This article is my attempt to get my fellow Generation Y people to resume their risk taking and to use all the tools at their disposal to increase their investments and side income earning now, when they are young enough to recover if anything goes wrong.
- Money For All Seasons I: Income, Spending, and Age (Seasons): Using the four seasons – spring, summer, autumn and winter – as a metaphor for the four different stages in our lives, I have set out some age related expectations regarding income, expenditure, investments and cash-flow. It is a common sense way to illustrate how our financial situation today carries into our future and that it is never late to change one’s financial trajectory.
INTERMEDIATE SPRINT # 2
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What If You Find Out Your Co-Workers Are Making More Money Than You (Co-workers): A discussion with some co-workers led me to discovering that I was underpaid for doing the same job. I handled the situation by doing my research, building a game plan, and confronting my boss. This is the story of how it all went down.
- I Sold My Hair (Hair): Proof that you can make money doing anything! Last August, my hair sold on Ebay for more than $100!!!
TOUR DE FRANCE DAILY RECAP
***Photo courtesy of http://www.flickr.com/photos/troye/6219621253/sizes/l/in/photostream/
Individual Stocks or Index Funds?
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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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The following is a guest post by Karl Marrion, a money saver and investor who runs the blog, WiseStockBuyer. Enjoy!
Individual Stocks or Index Funds?
Thanks to the web, the average small investor has more options than ever before to invest his or her cash. Readily available information on any publicly held company is within any investor’s grasp within minutes, thanks to online tools like Morningstar.com, Bankrate.com, SEC.gov, and thousands of others.
In addition, there are dozens of stock brokerages that will let anyone buy or sell shares in specific companies. However, there are also dozens of index funds designed to take the hard work out of investing.
Are you interested in individual stocks or index funds? Read on…
Individual Stocks: The Pros
Individual Stocks: The Cons
Index Funds: The Pros
Index Funds: The Cons
Keep in mind that market indices sometimes have long periods of mediocre performance. You’ll never know, of course, when one of these periods begins or ends. However, index fund investing is designed to make things easier for the small investor, so you shouldn’t spend any time worrying about when to get into, or out of, the markets.
Many small investors put the bulk of their retirement savings into index funds, while putting a little bit of “fun money” aside for dabbling in individual company stocks. Not a bad plan. Is this the plan you should follow? Every investor is different, and each investor is at a different period in his or her life.
Consider your own investing style, financial goals, and aversion to risk before making any decisions on where to put your money. And consider talking to that cute babe across the room about something other than stocks.
My personal approach
Personally, I prefer investing index funds rather than individual stocks. I like to get in after a big crash, when many investors are panic selling. I was a big buyer of index funds during the tech mess of the early 2000’s and the 2008-09 banking crash. I feel for me personally, this gives me a level of risk to reward that I’m comfortable with. Investing at these times takes a lot of nerve, as you are doing the exact opposite of what the masses are doing. Just remember one thing though, most traders are not making money, so you don’t want to be following them.
I use Optionsxpress as a brokerage firm. One thing I like to do when trading indexes is keep expense ratios as low as possible. When investing investing in the S&P 500 index, I use the Vanguard S&P ETF, ticker VOO. This is ETF has the lowest expense ratio of all the S&P trackers and it’s just 0.05%. Typically I have held positions for 6-18 months, depending on what happens in the market. As a general rule of thumb I tend to keep 50% of my portfolio in cash and the other half in equities and commodities.
***Photo courtesy of http://www.flickr.com/photos/argonne/4660306658/sizes/l/in/photostream/
Tour de Personal Finance, Stage 10, Round 2 – Posts 33-40
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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Without further ado, let’s continue on with the 10th Stage (we’re now in the 2nd Round of competition!) of the 2012 My Personal Finance Journey Tour de Personal Finance (to follow all of the action, click on the Tour de Personal Finance category link and scroll down to read all the posts involved in this subject).
AN IMPORTANT UPDATE ON PRIZES FOR THE COMPETITION
- Prize to Yellow Jersey Winner – $75.00
- Amount that will be given to a charity chosen by the Yellow Jersey Winner – $123.05
- Prize to 2nd place podium finisher – $50.00
To view the most up-to-date brackets of the competition, click the following link – 2012 Tour de PF Bracket.
Also, if applicable, I will give a brief description of the stage of the Tour de France that took place the same day as (or that has happened since the previous Stage of) the competition.
HOW TO VOTE
You can vote for the two articles (one from each intermediate sprint) you’d like to see proceed in the Tour by commenting in the comments section below and telling which are your favorites.
I’ve listed a keyword after each post title to make it easy to vote (as a made-up example, you can just comment: Sprint 1: Mutual; Sprint 2: 401k, etc.) Be sure to comment which one you like the best out of each set of two! Criteria for the best article is completely up to you, but you can use these factors as a guide: 1) post of your favorite blogger, 2) most interesting post, 3) most thought-provoking post, 4) most unique post, or 5) most actionable post.
Here are today’s competitions:
Voting will continue until July 13th for this Stage!
INTERMEDIATE SPRINT # 1
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10 Ways to be Rich Without Being Wealthy (Rich): Money is a tool, not an end goal. You only need as much as of it as will be necessary to have the quality of life that you want. That has less to do with a certain salary or portfolio level than we think. Here are 10 forms of “wealth” that can lead to a rich life and require very little emphasis on having or earning a lot of money.
- The Value of Work (Work): You won’t get the same props (or paycheck) for vacuuming an apartment building as you would for performing open-heart surgery. But, that doesn’t mean a janitorial job is demeaning. It just means we don’t have the sense to appreciate it.
INTERMEDIATE SPRINT # 2
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Realising the Sacrifices Our Parents Made (Parents): Recently, when I saw a hitch hiker, I remembered my dad hitch hiking to work practically every day. I thought it was normal, but now realise that no, my parents sacrificed a lot for us kids. There is so much we can learn from how frugally they lived, although I couldn’t hitch hike!
- Two Ways to Save (and Make) More Money in Less Time, Using Principles of Economics (Economics): Economics may be boring, but it can help you to make more money and save more time for your family. Here’s what I’ve learned from economics and how it applies to my family finances.
TOUR DE FRANCE DAILY RECAP
***Photo courtesy of http://www.flickr.com/photos/peter_curb/337542801/sizes/l/in/photostream/
Tour de Personal Finance, Stage 9, Round 2 – Posts 25-32
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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Without further ado, let’s continue on with the 9th Stage (we’re now in the 2nd Round of competition!) of the 2012 My Personal Finance Journey Tour de Personal Finance (to follow all of the action, click on the Tour de Personal Finance category link and scroll down to read all the posts involved in this subject).
AN IMPORTANT UPDATE ON PRIZES FOR THE COMPETITION
- Prize to Yellow Jersey Winner – $75.00
- Amount that will be given to a charity chosen by the Yellow Jersey Winner – $123.05
- Prize to 2nd place podium finisher – $50.00
To view the most up-to-date brackets of the competition, click the following link – 2012 Tour de PF Bracket.
Also, if applicable, I will give a brief description of the stage of the Tour de France that took place the same day as (or that has happened since the previous Stage of) the competition.
HOW TO VOTE
You can vote for the two articles (one from each intermediate sprint) you’d like to see proceed in the Tour by commenting in the comments section below and telling which are your favorites.
I’ve listed a keyword after each post title to make it easy to vote (as a made-up example, you can just comment: Sprint 1: Mutual; Sprint 2: 401k, etc.) Be sure to comment which one you like the best out of each set of two! Criteria for the best article is completely up to you, but you can use these factors as a guide: 1) post of your favorite blogger, 2) most interesting post, 3) most thought-provoking post, 4) most unique post, or 5) most actionable post.
Here are today’s competitions (Sprints 1 and 2 of Stage 9 went live earlier today, so be sure to cast your vote for those as well!):
Voting will continue until July 12th for this Stage!
INTERMEDIATE SPRINT # 3
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Online Poker: Is It as Legit as Stock Picking? (Poker): There are those that believe stock picking is a lot like gambling — and those that believe online poker is a safer bet than stock picking. Could online poker be as legit as picking stocks?
- How Young Adults Can Still Thrive Financially (Thrive): With all that’s gone wrong in the economy lately, it’s hard to see the silver lining for today’s youth. Most pundits believe that generation Y is screwed. Luckily, it’s not all doom and gloom. There are plenty of opportunities for young adults to thrive financially. Here’s why:
INTERMEDIATE SPRINT # 4
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Key to Saving Money is Controlling Impulse Spending (Spending): Have you gone to the grocery store for milk and eggs and come home with steak and eggs? Have you ever been tempted to buy something just because it was on sale? Impulse spending can wreck your finances and is a major reason why most people have difficulty saving money. Learning why you buy on impulse can be the key to saving more money.
- The Grass Isn’t Always Greener (Greener): We’ve all wondered at some time or another if another job would be better than the one we currently have. Sometimes it is, and sometimes it it’s actually a lot worse. This the story of my ill-fated job change and realization that we don’t really know what we have until it’s gone
TOUR DE FRANCE DAILY RECAP
***Photo courtesy of http://www.flickr.com/photos/joi/9913697/sizes/l/in/photostream/
Tour de Personal Finance, Stage 9, Round 2 – Posts 17-24
————————————————————————————————————————
Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
————————————————————————————————————————
Without further ado, let’s continue on with the 9th Stage (we’re now in the 2nd Round of competition!) of the 2012 My Personal Finance Journey Tour de Personal Finance (to follow all of the action, click on the Tour de Personal Finance category link and scroll down to read all the posts involved in this subject).
AN IMPORTANT UPDATE ON PRIZES FOR THE COMPETITION
- Prize to Yellow Jersey Winner – $75.00
- Amount that will be given to a charity chosen by the Yellow Jersey Winner – $123.05
- Prize to 2nd place podium finisher – $50.00
To view the most up-to-date brackets of the competition, click the following link – 2012 Tour de PF Bracket.
Also, if applicable, I will give a brief description of the stage of the Tour de France that took place the same day as (or that has happened since the previous Stage of) the competition.
HOW TO VOTE
You can vote for the two articles (one from each intermediate sprint) you’d like to see proceed in the Tour by commenting in the comments section below and telling which are your favorites.
I’ve listed a keyword after each post title to make it easy to vote (as a made-up example, you can just comment: Sprint 1: Mutual; Sprint 2: 401k, etc.) Be sure to comment which one you like the best out of each set of two! Criteria for the best article is completely up to you, but you can use these factors as a guide: 1) post of your favorite blogger, 2) most interesting post, 3) most thought-provoking post, 4) most unique post, or 5) most actionable post.
Here are today’s competitions (Sprint 3 and 4 of Stage 9 will go live later today, so be sure to cast your vote for those as well!):
Voting will continue until July 12th for this Stage!
INTERMEDIATE SPRINT # 1
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11 Things I Learned in 2011 (Things): 2011 was a crazy year, involving unemployment, landing a book contract, launching a new career, renovations, learning to adapt to new situations, and overcoming hardships. I share what I learned with all of that happening in this post.
- How Far Would You Go To Pick Up a Penny? (Penny): Most of us love free money, but how far would you go to pick some up? Would it matter who you were around, or how dirty the coins/dollars were? What if they were on the bathroom floor? These are all questions I pondered at a bachelor party recently… figured better that than some other things 😉
INTERMEDIATE SPRINT # 2
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Should You Charge Your Boomerang Kids Rent? (Boomerang): It’s no longer a given that kids will move out on their own when college ends. In fact, there’s a term for this group – Boomerang Kids. Should you charge rent to these boomerang kids?
- Stop Crying That There Are No Jobs. Create One (Jobs): Be motivated by opportunity, not fear.Don’t dis-empower yourself by believing that someone else — someone smarter, richer, and probably better-looking — must create a job and bestow it upon you.
TOUR DE FRANCE DAILY RECAP
***Photo courtesy of http://www.flickr.com/photos/teamtraveller/4831122469/sizes/l/in/photostream/