October 14, 2021 update: After this post was published, Joel made a personal investment in LifeGoal Investments.
Just got back from FinCon in Austin last week! For those of you who don’t know, FinCon began in 2011 as the Financial Blogger Conference, but now it’s a place for all types of digital content creators, money nerds and brands to get together and geek out on personal finance stuff.
This was my second time going to FinCon. I met 1000 cool bloggers there, learned 1000 new things, and drank 1000 beers. Very fun stuff.
Rather than doing a review of the event and name-dropping all the bloggy-celebs who were there, I wanted to share some of the neat brands and companies that surprised me. I love FinTech and want to spread the word about anything that can help people make/save money in smarter ways. Here are 3 cool FinTech companies and apps that I found interesting, and you might too…
**No, they didn’t pay me to write about them or sponsor this post. Just sharing stuff I think is good!**
LifeGoal Investments: ETFs for Various Life Goals
On the first day of the conference my friend said, “Have you checked out LifeGoal Investments yet? They are super interesting! They are a new company that created 5 different ETFs people can invest in.”
In my head I was thinking, “Who cares? The only ETF I am interested in is VTI. Why would I invest in anything else?”
But then later I learned what these ETFs were created for and their purpose. The more I spoke with LifeGoal Investments, the more impressed I was with their mission! They are helping people store less in cash positions.
Specifically, 2 of their ETFs really struck a chord with me…
The first ETF is called LifeGoal Homeowner ETF (NYSE: HOM). This ETF was specifically created for people who are saving up for a home down payment. It’s the first time I’ve ever seen an ETF address this problem (and they actually have a patent pending for this type of ETF).
Here is the problem it solves: One of the biggest hurdles for a homebuyer is saving up to make cash down payment. The average size of a down payment in America is ~$47,000, and the average time it takes to save is 6.5 years!!
The challenge is, most people save their down payment in cash. They save cash in a regular checking account (earning $0 interest) or a savings account (earning a few pennies interest). Meanwhile, from the time they start saving until the time they are ready to purchase a home 6 years later, housing prices continue to rise and inflation eats away the buying power of their cash savings.
The solution is to convince people to invest their housing down payment while they save up. BUT… What average person trusts the “stock market” and knows how to invest conservatively!? Investing in 100% stocks can be “risky” for potential homeowners because if there’s a crash, they could lose a chunk of the down payment.
Well, that’s what the HOM ETF was built for. It’s very conservative (~75% bonds, 25% stocks) and the biggest stock holdings are directly tied to the housing market. It holds stocks like Home Depot, Lowe’s, Zillow Group, etc. The idea is that as the housing market rises, a portion of the down payment savings also rises, helping people afford higher house prices when they’re ready to buy. REALLY innovative stuff! Read more about HOM here.
The other ETF that impressed me was General Conservative ETF (NYSE: SAVN). This is built to help people conservatively invest their savings or everyday emergency fund.
Most of you guys know that already I lowered my emergency fund significantly, investing most of it in VTI. And many people shook their heads at me, thinking it was very risky! (It kind of is.)
But, I still believe holding emergency fund cash in a checking/savings account hurts more than it helps in the long run. So this new ETF called SAVN is a different, very conservative way to invest emergency cash to make sure money is still working a little bit for you. Read more about SAVN here.
**This is probably a good time to remind you that I am not a financial advisor! Don’t invest in stuff just ‘cause I think it’s cool. Gotta do your own research. :)**
Qube Money: A Budgeting App with “Envelopes”
Budgeting with physical envelopes is pretty common. Many people love it. You take your paycheck, turn it into cash, divide all the dollars up into different envelopes and spend only what’s inside each month.
Qube is the digital version of cash envelope budgeting. The basic plan (free) lets you create 10 envelopes — called qubes — and spend money via a debit card. The big difference is that by default, the debit card holds a $0 balance. By this, I mean that the card can only be used after you assign it some money from one of the envelopes. All spending is controlled by the app, BEFORE a purchase is actually made on the debit card.
Here’s a quick video showing how it works: Qube Money Video
What I love about this budgeting process is it encourages more intentional buying habits. It helps people stop and think before making purchases. The app is designed to not allow you to overspend in a category (just like you can’t take out more money from a physical envelope than what’s actually inside of it). You are not capable of overdrafting.
I was also pretty impressed with the company’s product roadmap. Their paid versions offer more features, and family/children features are coming soon. This will allow you to give kids debit cards, and load them up with an exact amount of money, instantly, from the mobile app.
If this seems cool and you’re looking to replace your physical cash envelope budgeting, check out Qube. Like I said, the basic plan and sign-up is FREE! :)
**I also learned about a new app called Yotta, which has a similar “bucket” system for saving for money goals. They reward users with a lottery-like game and awards for meeting savings goals, encouraging good savings habits. Kind of cool!
RocketDollar: Self Directed IRAs
Lastly, I liked learning about RocketDollar. They’ve been out for a few years already so maybe I’m late to the game here, but this was my first time really looking at their offering.
RocketDollar makes it easy to invest in almost anything inside your IRA account. Instead of the common stocks/bonds/REITS, you can buy a physical rental property, invest in precious metals, cryptocurrencies, or even a private start-up business.
Alternative investments can sometimes be risky. But, with higher risk can come higher returns. Making higher profits inside a tax advantaged account can be a huge advantage over long holding periods as opposed to buying with after-tax funds.
It’s a little expensive ($15 per month with a $360 set-up fee), but all of the legal work and account structure is set up for you quickly, along with an LLC to hold investments. They also provide easy online tools to manage your stuff. Looking back, I wish I had used my IRA to invest in some of my real estate syndication deals. Instead, I used after-tax cash so I have to pay taxes on all gains the moment they are realized.
Now, before you get excited and gamble all your IRA funds away on crypto stuff… You’d better do your own due diligence on what you’re investing in. Just because you can do alternative investments with your IRA doesn’t mean it’s the best option for you.
Whelp, I’ll share more stuff about FinCon over time and maybe talk about some of the interesting peeps I met there. (A lot of TikTok, YouTube and Instagram influencers… they made me feel so OLD!)
Hope y’all have an awesome day ahead!
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Great article and suggestions Joel. What a honor to appear in that picture with you! I was very impressed with the the guys we met representing LifeGoal Investments. They are truly genuine, authentic, and the real deal. I highly recommend their services!
Jason! Great meeting you and hanging with you too!
Never heard of Rocket Dollar for self-directed IRA investments, I will have to look into them! I agree with your warning statement regarding whether you should invest in crypto, as crypto is not an investment in my opinion. Instead, it (potentially) is an alternative asset for diversification, similar to precious metals. Fidelity’ Jurrian Trimmer makes a good argument as such in a public video posted to their site.
Do you find FinCon to be a beneficial event? If so, what is the biggest benefit for attending as a blogger?
As a blogger, there are a ton of benefits going to FinCon…
– It helps dampen imposter syndrome… because you realize after meeting other bloggers that “nobody else knows what they’re doing either”
– You connect and become friends with strong/smart/profitable people in the space you can learn from
– Meet brands and companies you can potentially partner with
– You notice trending discussions and get new ideas of things to write about. Also there are many podcasting or guest posting opportunities if you meet the right people.
– It solidifies your reason for writing in the first place (To help others)
I think next year is in Long Beach, but not confirmed yet :)
Thanks for the reply, Joel! Your humbleness is inspiring. Maybe I will run into you next year!
What?! Rocketdollar?! BITCOIN TO THE MOON *insert 10x rocket emojis”.
Just kidding. These companies sound like innovative companies. I’m especially interested in Rocketdollar because I’ve been neglecting my Roth IRA when I know I shouldn’t be. Thanks for highlighting, Joel!
Cheers and good luck! ;)
Very cool about those LifeGoal ETFs. I’ve always figured that with near-term goal (life down payment on a house) you should allocate that to cash because you pretty much want to take 0% chance of having less money, yet if you’re talking 6 years a lot of people might be conflicted on how to invest it so it’s conservative. Vanguard and others have “Conservative Growth” funds, but I think it’s interesting how the align HOM with housing related stocks.
Hope Austin was fun Joel! Got to spend a few weeks there earlier this year, such an upbeat place.
Very rightly said.. being a parent and always trying to save for my child’s future is a biggest challenge.. financial planning at the right time and awareness of our priorities gives us financial security we all long for.
Wow, it’s pretty interesting how these different financial products are optimized for different folks in different stages of their lives.
Personally, the IRA one looks super interesting – I’ve also made the same mistake of investing a hefty sum in real estate syndications with non-tax sheltered money, and will need to pay taxes on any gains.
I think crypto has extremely high volatility (i.e. risk), but may or may not have high returns as a result. Hard to say without enough long term data to pinpoint a Sharpe ratio to say “yep, this is definitely profitable in the long-term.” But I think for those with a bigger risk appetite, they might find it beneficial to allocate a small portion of their portfolio to crypto.
Hey Angie! I guess now that the (BITO) bitcoin strategy ETF is launched, people could potentially buy into that in their IRA’s without having to self-direct anything. Not my personal cup of tea, but could allow for some exposure within retirement accounts.