Category Archives: Digital Finance

Addicted to Loyal3 Investing

Screen Shot 2014-12-05 at 3.30.57 AM

My investing hobby started with a few hundred dollars of fun money after maxing out my Roth to invest in individual stocks and ETFs to better understand the stock market. This same Sharebuilder account is now worth $101k and is filled with dozens of stocks and funds. Selling them will be a tax nightmare. I plan to hold them for the long run and sell during a few frugal years in early retirement so they get fairly decent capital gains tax rates.

One thing that always bugged me about my Sharebuilder investments is the trading fees. They used to have a better system where you could pay $12 for 12 auto trades per month — $1 trades weren’t bad, but even with the $1 trades you had to pay $8 or so to trade each individual stock/fund out. Now Sharebuilder got rid of the auto-investing plan and made the cheapest auto trade be about $4. That’s not so bad, but it is bad when you consider the whole premise of Sharebuilder is to build your shares slowly – by investing a little bit at a time. When you really start doing the math you realize these fees are massively cutting into your prospective earnings over time. I often wondered – isn’t there a better way?

The good news is – now there is. Loyal3 (not getting paid for this promo, I genuinely am excited about this company) makes it possible for the average everyday investor to invest directly into companies whenever they want for 100% free trade in and out. The companies are footing the bill to help everyday investors buy their stock. While generally speaking investing in index funds is the best bet, if you’re going to be a hobbyist investor and want to pick up a few individuals stocks without getting jipped on fees, now you have a great resource to do so.

So I got a little carried away tonight and purchase 6 individual stocks. They are limited in what stocks are available – but it turns out about 50% of my existing sharebuilder purchases are available. Unfortunately they don’t allow transfers in (bummer) so I’d have to sell my current shares in order to buy them again and trigger a capital gain just to consolidate my shares, not worth it. But the good news is now instead of wasting $4 per transaction on buying more shares of companies from Coca Cola to McDonalds to Apple, I can just buy however much I want to buy at whatever time and never have to worry about fees again. At least for the companies available to buy… which, granted, is limited at this time, but I bet will grow in the future.

I’m also testing the water for some new investments — I stopped adding new individual stocks to my sharebuilder account because the list was getting ridiculous and I couldn’t justify all the diversification with fees cutting away at my gains… but now diversification is easy, fun, and free. My investments aren’t showing up yet (they take 3 days to transfer in) but tonight instead of splurging on a new pair of jeans I bought some stock for $10 here, $25 there. I’m impressed.

*Note if you are new to investing I still recommend buying Vanguard Index funds!!!

 

 

 

 

Motif Investing vs ETFs: Digital Finance Tech

Mint.com, you finally — finally — provided a relevant offer that piqued my interest. Instead of offering ways to deal with the debt-that-i-do-not-have, you shared an investing company I had not heard of yet — Motif.com, and enticed me with an offer for $150 to sign up, and sign up I did.

The general concept of Motifs is that, much like ETFs, they provide you the opportunity to diversify in a specific industry without buying a ton of individual stocks. But instead of being limited to existing ETF funds, they offer “Motifs” — themes with a group of stocks that they recommend looking into for investing. You can also customize the Motif so you can make it more to your liking and still pay the same fee for buying the diversified batch of stocks. Instead of boring ETF themes they can be very niche, such as the high-performing “fracking” theme (see screenshot below), yet enable you to diversify within this motif for a $9.95 trade fee. That’s quite high compared to the cost to buy an ETF at Vanguard or even Sharebuilder (where I enjoy autotrades for $3.95 to buy), but it does provide some interesting means to go after short-term growth. Continue reading

The Personal Finance Blogger Network

Some of you may remember an old blog that I kept on a separate URL – The Personal Finance Reader. Basically, I had trouble keeping up with all the great personal finance blogger content out there and started a site that had a running public RSS feed of my favorite blogs. Then Google Reader (which was powering the site) shut down, and so did the site.

I figured out how to launch a similar public feed on this blog. Woohoo. You can check it out at the link in my menu called Finance Network. I’ve included many of the top personal finance bloggers, and it displays the last two posts each blogger has written within the last year. If you’re a personal finance blogger and I missed you from the list, please let me know in a comment or email me at hereverycentcounts@gmail.com

PersonalCapital.com vs Mint.com: Innovation After Intuit

PersonalCapital.com's Portfolio Risk Manager

I’ve been a long time fan of Mint.com, raving about the features and design for anyone trying to track multiple accounts of income, savings, spending, and investments. But ever since they were acquired by Intuit, I felt the level of quality decreased. Innovation ceased, or was focused on building an iPad app I personally had no use for, while the website stopped connecting my accounts properly.

When I lost all of my investment data before January of last year (due to account connectivity issues), I pretty much stopped using Mint, except to check my budget every now and again. Google docs was much more useful than a site where my account connections kept breaking.

The entrepreneur in me always felt there was a great opportunity for another company to swoop in and do a much better job at finance management. At the same time, Mint was clearly focusing on people with credit card debt, trying to affiliate marketing better credit card rates, among other targeted advertisements. It’s budgeting tool, which once let you see how much money you could save in a year, was changed to be month-by-month only. It’s investment analysis, besides losing my data, was sorely lacking. And recently I’ve wondered (and have good reason to believe) Mint might not be around much longer. It doesn’t make sense in the Intuit portfolio of pay-for products, and they’ve just killed the quality that made it so great in the first place. Sorry Intuit, I love TurboTax, but you’re killing Mint and I haven’t been happy about it.

It was only a matter of time when another company stepped in to pick up where Mint left off. PersonalCapital, which apparently launched in September but I just heard about last night, is being talked about as “Mint.com for rich people.” Ha. The site provides a much deeper view into your investments (while letting you easily auto connect accounts like Mint). They want to make money by providing an optional service of 1% of your account for deeper investment advice, but otherwise provide a free service which shows you how your portfolio may be out of whack. If a focus on investments and long-term growth is Mint.com for “rich people,” then call me rich, and call me interested.

Now, I’m not sure their business model makes sense, so I’d be hesitant to give up Mint entirely (there is great value on historic data, even if Mint lost all of my Sharebuilder account data for the last three years!) and who knows if PersonalCapital can make it, or how the business model will change. I’d imagine they’d do better charging everyone for site access, but a small monthly fee ($2.99 / month) and perhaps add on fees for more insight. Not that I want to pay for this service, but I’d rather pay for a product that works well at this point then invest my time into something free that doesn’t. I imagine if they are going after the “rich” like me (with my $120k networth, ha) then the sentiment might be similar across the board.

The site’s UI is not as intuitive as Mint (guess that’s why Intuit bought Mint, ba dum dum.) They’ve clearly focused their resources on the investment portion of the tool, which makes sense. Already, I’ve been able to quantify just how unbalanced my portfolio is regarding international exposure, which I already knew, I just didn’t know what percent I should focus on investing abroad next year (go Asia go… I’m in the marketing for a good China & Japan dividend ETF, any suggestions?)

What’s missing is the budgeting and ease of categorization tools, which means a lot for tracking your finances. The worst part so far is trying to re-categorize all of my spending. I haven’t figured out if you can create your own categories and the ones they offer are limited. Many items come up uncategorized and trying to change them is a pain (you have to scroll through a long list, there isn’t even a way to type in the category and have it “guess” what you’re writing so it pops up. I’ve given up at using Personal Capital as a budgeting tool for now. The worst of it is that my spending always includes a lot of work expenses, which I have to mark at reimbursements, otherwise my entire spending report is massively out of whack. Maybe if this is Mint.com for rich people they could partner with Expensify and/or provide an easy way to note your work expenses so they don’t get all mixed up in your spending reports.

In any case, I’m excited about Personal Capital, because — even though a lot of the PF journos think Mint.com is the clear winner in this market — there’s a lot of room for innovation here. I’ve long wanted to make a site like Mint that actually provided useful input about one’s overall portfolio. It looks like Personal Capital beat me to it, but given I’m already working at a successful startup and I’m buried for the next year writing a business book, I’m glad they did. My scattered portfolio desperately needs the insight.

 

Live from The Financial Blogger Conference: Day One

Sneaking in a quick blog update from my hotel room before heading out tonight with a few other personal finance bloggers for dinner — I landed in Chicago last night and got in super late, so have been a bit exhausted all day getting work work done before I head out for the weekend.

It’s definitely an interesting mix of people here — I wondered how many I would recognize, and how many, if any, would know of me or my blog. As I haven’t been the best in keeping this blog updated, there aren’t too many people who follow me regularly (well, apparently there are 150 of you that do / subscribe.) Still, I’ve been writing on and off on this account for a good six years, which means random people have seen me around the interwebs.

I’m really enjoying the few conversations I’ve had so far with folks at this event with folks like Give Me Back My Five Bucks, Blonde and Balanced, Faith Based Finance, Glenn from Prosper, and a few other folks. It’s so faux paus to discuss financial matters amongst friends, but I love to geek out about this stuff. That’s not to say I’m very wise with my money, but I enjoy learning better ways to increase income, save, and invest. It’s fun to be with other personal finance geeks who at least share an openness to talk about money.

In other news, the most hilarious thing ever was the giant swag bag they gave away at check in at the conference. It’s hilarious because as a marketer I know there’s quite a plethora of crazy swag you can buy and brand and hand out — but some of these items were just so silly. I’ll upload photos later, but Krystal at Work (Give Me Back My Five Bucks) and I both decided that the prize for worst swag ever goes to:

Worst Swag:
Regiftable — a snow globe of a woman holding gifts. Now, most of us flew in for this event, and aren’t going to bring a fairly large glass snow globe with a company logo back with us, even if the quality of the item is decent. Second worst swag item goes to the foam finger that says “blog on.” At least I know that didn’t cost them a lot, and it’s kind of funny, so it got the point across and had good logo placement. But a snow globe — really?

Best Swag:
A Personal Finance Calculator from the “For Dummies” brand — it’s pretty awesome, and an easy way to calculate compounding interest, etc.  I’m sure it will come in handy in the future.

Anyway, enough complaining about the swag. 🙂 What this event is really about is getting a bunch of personal finance savvy folks together at one time. It’s fun to run into folks whose blogs I’ve read (or occasionally read) for years. Tonight I’m headed out to dinner with a few bloggers, then there’s a reception and a “speed networking” session. The speed networking session is actually a great idea — you get one minute per person to introduce yourselves, it will help a lot for us introverted bloggers to have a chance to meet people before the big conference day tomorrow.

I’m definitely glad I came to this event — even though I feel like everyone else here is a lot smarter about money than I am. A lot of them are legit banker/accountant/finance writer types by day, and that I am not. I look forward to everything I’ll learn this weekend, the people I meet, and the “time off” from 24/7 thinking about my day job to think a bit about my financial future. This is my idea of a vacation. 🙂

Attempting to learn how to Budget with Beehive

Thanks to an anonymous poster for reminding me how I really need to start budgeting. After my little shopping trip to the local mall the other day, I realized just how little control I have over my spending. One of my biggest problems (and I know I’m fortunate to even have this problem) is that I have $20k+ in savings, so often I feel like even though I shouldn’t be spending that money (I should be SAVING it for grad school or a house) – but it just feels like those bigger ticket items are so unreachable that I might as well just spend my money now. And I get such a rush buying clothes. Especially ones that I feel good about buying… when I feel like I’ve bought items that I’ll wear again and again. It makes the endorphins kick in. Shopping is my drug. But it’s an expensive habit. And I need to quit it.

In any case, I’ve decided to try to make a budget and to… hopefully… stick to it. There’s no reason I can’t get through a month on a monthly salary of about $3000. It’s pathetic that I’m still losing money. Ok, so I haven’t actually gotten through my first “full” month of work, so last month was just a mess financially anyway, with my time off between jobs and everything. In any case, I looked online to find some budgeting tools, and of course, I found a zillion. I picked one out at random…

Beehive basically helps you make your budget. I’m going through right now and filling in all of my income and expense information. This should help me see exactly how much money I have to use to budget per month.

I’m trying to estimate low for non-fixed income, since I’d rather end up with more money at the end of the year than less. When they asked how much I make per year in investments, I put down $200. I think my CDs probably take in about $300 per year, but the way my other investments… Roth IRA and Mutual Fund are doing, I’ll be lucky if I break even this year.

Meanwhile, I’m estimating high on most expenses. I’m really confused on how to budget, but I guess ultimately if I put in $100 a month for clothing I NEED to stick to that.

Here’s what I’m budgeting for non-fixed expenses…

(per month)

Clothing: $100 (um, can I really just spend $100 a month on clothing?) $200: I don’t have to spend all $200, but I’d rather save some money for clothing each month and then go on a massive shopping spree, as opposed to only having $100 to spend.
Gasoline: $250 (it’s been that high in the past few months because of all of my commuting for various reasons. In september, my gas costs should come down quite drastically, but it can’t hurt to estimate high, right?
Entertainment
: $200. Should include alcohol costs. Because that’s what adds up.
Beauty: $100. I figure between eyebrow/face waxing, and my occasional hair cut, beauty costs average out to about a hundred a month. Maybe I should estimate higher. Hmm.
Alcohol: $50. Here, I’ll through in an extra $50 for those rare months when I actually have a social life.
Travel: $100. That’d get me to Hawaii in a year.

Anyway…

Now I’m entering in “Assets”

I’m confused as to how I should record my assets for my investments. Should I note how much I put into the funds, or how much currently exists in the funds? It doesn’t look like there is a spot to track the funds, or to note how much its average earnings (or losses) are per year. Hmm.

I guess I’ll put in what they’re currently worth. It will make me less sad to start off with a smaller amount in my budget anyway. And I can kind of (try to) forget that thus far my investments have lost $400.

15 minutes later.

Ok, so I’ve decided “Beehive” sucks as a budget tool. I really wish there were an easy way to make a budget and track my finances.

One thing I don’t like about Beehive is that when you’re inputing your expenses for the month, it lumps all your “personal expenses” together. That includes everything from clothing to gasoline. What I really need is a breakdown of my “personal expenses” spending. I guess it’s not a terrible idea to start thinking of it as a lump sum, because then I might be motivated to spend less on eating out in order to support my shopping addiction. But, still, I think it’s important for me to break down my spending via category, and see where the money goes each month.

Meanwhile, I find it’s really difficult to keep track of expenses that I am supposed to get reimbursed for at work. I feel like they should be counted separately, but I need to make sure to note that any future income that’s actually reimbursement needs to cancel out.

Does anyone out there know of a good way to make (and keep) a budget? Help!