What’s up, fiscal friends! Been answering a lot of $$$ questions lately in emails, and thought I’d pass some of them along here in case anyone else is wondering about ’em too…
Most of it’s on investing, but there’s also some questions on paying off debt, buying a first home, taking on school loans, tax refunds, and then a smattering on blogging as well.
Always fun to answer these, and always available to answer *your* questions too whenever you have any… I might not have all the answers, but I can promise you I will always have an opinion, haha…
Here we go!
(And shout out to the Financial and Technology Literacy class over at C. Milton Wright High School for some of these questions – y’all’s class seems cool! As does your teacher, so try not to give him too much $hit, okay? ;) Also – all the gifs here are for you.)
Have you ever went on a spending binge?
Hell yeah!! ALLL the time back in the day… and still go a bit too far sometimes these days when I’m super excited about something (reading books, collecting coins, etc). But I guess it’s all subjective as “spending binge” to me is spending a couple hundred dollars on the spot, whereas for others it could be thousands :) Which I’ve never done, unless you count buying a house or a car? (And $$$ is $$$$ so I guess it should count!)
How do you stay patient with investing?
I think it’s easy because all of my $$$ is in retirement accounts that I know I can’t touch for X # of decades. So since there’s no temptation to pull from it on the daily, I really don’t have much of an option not to be patient :)
I’ve tried dabbling in stocks here and there over the years in a separate non-retirement brokerage account, but it seems every time I do that I freak out or don’t enjoy it and I end up just going back to my safe tax-advantaged retirement accounts again. Also, it helps that I’m surrounded by smart $$$ people all day long for “my job” so all my peers are doing the same thing!
What do you look for in a company to invest in?
That it’s an index fund, and that it’s with Vanguard :) I really don’t deviate much at all from that anymore as I’ve been an indexer convert going on 4 years now. I don’t enjoy, nor have the patience, to research individual stocks, and everything you read points to indexes beating out a majority of other strategies long-term anyways, so I just ignore the rest and keep on pouring in as much as I can into my retirement accounts… Even Warren Buffett recommends index funds to people!
(Shout out to Ramit Sethi for this one, haha…)
How do you start off investing with little or no money? Do you like Acorns?
Oh yeah – big fan of Acorns and Digit and the like – whatever gets the ball rolling! Same with the robo-advisors out there like Wealthfront or Betterment or WealthSimple. You may have to pay some fees to use them, but fees on investing SOMETHING vs NOTHING is a bet you should take all day every day…
And honestly, the best place to really start is again with your retirement accounts and in particular your 401(k). If you’re working at a company that gives you FREE MONEY to do something you should be doing anyways (investing), then why not take advantage of that and contribute at least to what your company’s matching? That alone gives you a 100% return on your money right away, and there’s *nothing* out there that can beat that.
So for me it’s 401(k) first, then a Roth IRA, and then to the Acorns and Digits out there to help stash whatever extra money is laying around you’re not using. (Or if you’re a baller, going back to maxing out that 401(k) and then moving to Acorns and the like…) Really can’t go wrong with that plan.
Do you have any information on helping with using Turbo Tax? I can not seem to understand why all these people get money back during tax season and my family does not :( It makes me resentful and I am afraid I am doing something wrong and missing out on some money?
I’m sorry to hear that :( You can’t compare to others though, as everyone has different situations. And really, if you’re breaking even every year it means you’re probably doing everything the correct way because you’re not giving the gov’t a loan! You can adjust your withholdings so they take out more and you’ll get “free” money at the end if you wanted to, but honestly it’s probably best to stay as-is.
Another option is asking around for a reference from friends/colleagues to see if anyone has a good accountant they know, and then running it by them as well. I gladly pay $300/year for mine, and she not only helps me find stuff, but I can also ask her questions anytime I want directly too :)
Of course, if you don’t have a business or side income or anything like that, there’s not much room to find these “hidden” savings, but you can always start dumping more into tax-advantaged retirement accounts too to protect your money from taxes more. I’d focus on ways to do that, or to earn more in general, than what people are getting back on taxes as that doesn’t mean anything.
How did you pay down your debt so quick?
The fast answer is: I never had tons of debt to begin with. I was never *great* with money, but fortunately I wasn’t ever *bad* with money too, so my only debt when starting out my financial journey was maybe a couple thousand in credit cards. We did own a house once w/ a large mortgage, but I got out of all that debt by cheating and selling the place :)
Anytime I did have debt though, like with car loans, I’d just pay extra towards the principal every month (at a minimum I rounded up to the nearest $100th, and at maximum I’d send in double the payments), and for me focusing on the smaller balances a la Debt Snowball method helped motivate me a lot more than focusing on the %’s. (But only because my %s were super low – if they were ridiculously high I would have knocked those out first and then moved to the smaller balances again…)
And did you invest while you paid off your debt?
YES – the only thing that got me to where I am today is that I invested no matter what was going on around me! And I still do. My 401(k)-equivalent first, and then maxing out my Roth IRA. Usually I don’t have anything left after maxing out those two, but if I did it would all go back into investing more.
Everyone has their opinion on whether you should invest while paying off debt or saving for a house etc/etc, and the only answer I ever give is to go with the one that EXCITES YOU the most. We all do much better when we’re motivated and enthusiastic about an approach, so for me that trumps everything. And there’s no shame in changing your mind or testing diff. avenues over time either. Life – and our own goals – change constantly. You have to stay open to adapting along with them or you’ll just drive yourself mad…
I have $12,000 in student loans and $10,000 in credit card debt
I don’t know what your interest rates are, but my guess is that the $10k in c/c is pretty damn high, right? Like over 10%? If so, I’d concentrate ALL your effort on those until you wipe them away completely. You can invest on the side a little too if you’d like (def. still contribute to your 401k), but those rates will KILL your finances and it’s an immediate return of your investment w/ each payment you make.
I’m thinking about going back to school to finish my bachelor’s degree with grant money and sadly more loans so I can get a better job that pays more. The thought of more loans makes me sick though.
That does suck, I agree, but unless you’re going to become an entrepreneur and make your own $$$ on the side, that degree is going to go REALLLLL far in life, as well as help make you a ton more over time too (they say those w/ a degree vs those w/out will make an average of $1 Million more over the course of their lifetime – that’s pretty worth it!).
So I’m all for more education, but again it comes down to preferences and passions/etc. Plenty of people become successful w/out graduating from anywhere, but they also get there by having crazy drive and hustle (and smarts). Only you know which bucket you fall into the most, so you gotta roll with that.
What are your thoughts on purchasing a house? I’m getting married next month and we will be looking. We already got pre-approved, but it’s a tough bullet to bite knowing I’ll have a 200,000 loan… Our rate is 4.5%.
I have STRONG feelings on houses and don’t think they’re right for everyone, so I might not be the best person to ask on that one, haha… I proudly rent!
However, if you ARE going to go down that path, then I would just make sure you have a butt ton of cash saved up for maintenance and that you REALLY WANT IT at the end of the day. And also that you don’t buy something at the highest amount you’re approved for either. Banks will always approve you for more than you can afford, and the last thing you want is to be stuck with a major money pit and not being able to enjoy your new lives together… If you’ve ever heard of that saying, “house rich and cash poor”, this is what it means.
That said, home ownership *is* great for a lot of people and can def. make sense financially, but please just don’t rush into it like I did and then regret it later. Take your time and research and save up $$$, and then keep your eyes open on both the market as well as your goals… Nothing wrong with renting for a while either, despite what others say!
I’m seeking your advice on how to get more traffic to my new blog. What are the most effective ways you have found?
First, if you haven’t done this already, submit your blog over to our Directory so others can find it faster. Then, if you have the time and enjoy community stuff, jump into the forums and start engaging with others – the more bloggers who know who you are the more chances of traffic and collaboration and just having fun!
Outside of that, the #1 thing you can do for traffic right now is to *guest post* on as many other $$$ blogs as you can. You gotta get your blog out there in front of others, and guest posting gives you new audiences to talk to, as well as *links* back to your blog which are gold online. This tells Google and search engines that your site is growing and becoming popular, and thus they push you closer to the top for organic traffic (this is SEO stuff, if you’ve heard of that term yet). There are lots of other SEO tricks you can do too, but I wouldn’t mess with any of that right now. Too much of it can water down your site and make you sound like a robot.
But really, the most important is just writing GOOD CONTENT and then sharing it as best you can. As well as engaging with the blogging community – you do those two things and there’s no way for your traffic not to grow :)
Any advice on monetizing stuff?
I wouldn’t think about monetization at all right now – wait 5-6 months until you know you’re enjoying it and going to stick around, and then you can worry about that type of stuff. You’re not going to make any $$$ until you get some decent traffic coming in anyways, so you won’t miss any.
Any other general advice you can share?
Just do your best to have fun and meet other people! The money and lifestyle stuff that can come out of blogging is great, but if you’re not enjoying it then you’ll burn out way before even reaching that point.
Also, don’t be afraid to take a stance on things! People read blogs to get your opinion on stuff, and the more you can open up and be raw the better. There are tons of sites that share the pros and cons of something, but money is much more than just a list of facts. It’s personal, and the more you can share of yourself, the more you’ll connect. Don’t stick with only the *good* stuff either – talk about all the crap in your life too as ain’t nobody’s life perfect!
- Write when you’re *in the mood* and passionate about something
- Do your best to keep a schedule, whether it’s once a week or once a month (this not only helps you to stick with it, but also tells your audience when they can expect a new article too)
- Respond to your comments from all your lovely readers!! For some reason bloggers are notorious for not doing this, and I really don’t get it. Your fans are taking the time to share thoughts and ask you questions, and your only response is to ignore them? When it’s because of them you get to do this every day? It takes a lot of time and doesn’t “pay”, I get it, but good Lord – at least pop in there every now and then and let ’em know you’re paying attention! Might as well just turn comments off if you don’t want to engage with anyone…
- Share and link back to other articles/blogs you love. This not only shares other perspectives with your community, but also helps pass around the love to your fellow bloggers as well… And while you’re at it, help me bring back the blogroll please!! “Experts” killed them when they told everyone to just keep everyone on their *own* site only and never send people off, and now because of that no one gets to see all the awesome blogs you follow and love :( And maybe we’d love them too! It’s not like you’re the only blogger we follow anyways – we cheat around!
I can go on and on, but I have a feeling I’ll just get feistier the more I do, haha… Just focus on putting out the best content you can and being YOURSELF, and then love the crap out of everyone and you’ll do just fine :) The rest you can learn as you go…
I see you like to blare hip-hop. I was listening to some Big Baby DRAM today. Who are you into?
Haven’t actually heard Big Baby DRAM before – will have to check out! I’ve been listening to a lot of old school stuff lately – Wu-Tang, Wyclef, then also the new stuff from N.E.R.D., as well as the Hamilton soundtrack (hah). If only all history was rapped…
Other questions/comments/concerns – hit me! Always happy to flex my brain for you… Which looks mysteriously a lot like this: