I’ve been doing something really really stupid for the past 5 years.

Not only have I been paying for a subscription that I never ended up using (!!), but over these years it’s also increased by 300%+ and I didn’t even notice it!!

What a dummy!

This service I’ve been throwing my money at for the past 1/2 decade is Avast Premium Security – the antivirus software – which I’d never used my entire life, but have a vague memory of one day caving to a promo thinking it was a smart move.

Followed by another vague memory of remembering I needed to *activate it*, but then promptly forgetting about it and never actually DOING IT (yet continuing to pay for it as if I had, and letting one year roll into the next year and then into the next, and on and on for a total of 5 dumb years – ugh!!)

So that was mistake #1: not even activating the service.

Mistake #2 was then blindly paying the invoices year after year assuming that a) Past Me already did the research and verified it was worth it (nope), and then also that b) the software must be working because I never did get any viruses! Lol… So why cancel a good thing?

Then we have mistake #3: not realizing that each year the rates WENT UP. And I didn’t even notice it. Or check it out. Until I did one day, and, well, realized it was now 300% higher than when I first  signed up for it! Wow….

Here’s what I found when I finally sorted through my email receipts. Which is super embarrassing to even type out (!!):

• 2019 – $29.99 (the promo deal for 1 PC… though 6 months later they “upgrade” my account to cover 10 devices while also providing “better coverage” – something I couldn’t opt out of, even if I were onto their scheme. This “special” was valued at $69.00, giving the grand illusion I had saved $40 since I only paid that initial $29.99! Which is how they slowly got their claws in )
• 2020 – $79.99 (the “upgraded” promo now being over, it goes back to the $69.99 price tag + an extra $10 for good measure – effectively DOUBLING the initial price point!)
• 2021 – $89.99 (creeps up another $10 bucks…)
• 2022 – $95.39 (and then a bit more – “due to taxes”)
• 2023 – $105.99 (and then even more… But it’s okay, because this year comes with a “free gift” – 3 months of Avast SecureLine VPN which probably made me feel good enough at the time to not question any of it, even though of course it’s something I also didn’t activate.)
• 2024 – $105.99 (No extra fees this year, but I still let it renew without question… Until  a few days later when I thought to check on it!  And realize not only wasn’t I using it, but I never even needed it – as evidence again of not getting any viruses this whole time lol… So I cancel it immediately and shake my head at how long I let this happen right under my nose…)

And I gotta say – I don’t blame Avast at all here. Outside maybe their tricky “upgrade” scheme there in year 1. It was my job and my job only to know what, and why, I was purchasing, and then from there consciously paying attention to the fee creep each year. All things I blindly ignored.

And to their credit – they gave me a refund for this year’s charges as soon as I asked for it, and I noticed they even shot me “1 month out” reminders that the service was about to renew each year too. So I basically had DOUBLE the opportunity to pay attention every year!!

But as we all know we can get so used to subscriptions that we don’t even challenge them assuming Past Us did the work already, but even if it *was* the right move and beneficial for us back then, it doesn’t necessarily mean it’s right for us NOW. Life changes, needs change, and PRICES CHANGE!

So do yourself a favor and look over your c/c statements as soon as you’re done reading this to make sure you still want and need whatever subscriptions you’re currently signed up for too.

I bet you’d be surprised at some of the costs compared to when you initially signed up! And if you’re not happy with any of them, cut ’em! Or try to negotiate! Whatever you do – don’t keep your head in the sand like a jackass (me) and assume that what you needed back then is what you need right now.

And if you really want to feel better about yourself, check out my entire Resume of Fails here –> jmoney.biz/fails. I’m sure it’ll only get longer with time ;)

You’re (not so) perfect friend,

[This post, My $507.34 Ridiculous Mistake!, was first published by J. Money on Elite Edge Money]

Good morning!!

Have you messed up at all with your money lately?!

I have – 3 times already this week and it’s not even over!

Here’s what I’ve done that’s cost me $50 so far and earned me the Financial Dummy of The Week Award… sigh…

******

1) I lost $16 in cash at the coffee shop. I had been needing more loose cash in my pockets due to my mandatory Yes Rule, so I broke a $20 to get my coffee Monday instead of using plastic, and then made the stupid mistake of keeping it in my hands while awaiting my coffee… Why I didn’t put it safely in my pockets I couldn’t tell you (I guess I was distracted?) but shortly thereafter realized it was no longer in my hands and now lost to the world :( My only hope is that I accidentally left it on the counter and the baristas took it as a tip so at least someone had a great day! Haha…

2) I paid $12.64 for an empty box I could have gotten for free (!!) I had to make a return to Amazon that originally came in two boxes, but when I went to the UPS store they said it had to all fit into *one* since I only had one return label. All I had to do was drive the 5 minutes back to my house and scoop up one of the MILLIONS of boxes hoarded in my basement for times EXACTLY LIKE THIS ONE, but instead I chose the ridiculous option to just buy a box there and save 15 minutes instead… Even though I was in no rush whatsoever. Pure laziness!!

3) I paid $19.31 in overdue bill fees! The first time in 10+ years!! I was updating the ol’ net worth Sunday (a much more fun month to do it btw compared to recent months! ;)) when it occurred to me that I haven’t seen one of my most annoying bills to pay each month – our water/sewage bill. (Annoying because I always have to type out the dang routing and account number every time I pay it as it doesn’t let you save anything!)

The bill typically shows up in my email around the middle of each month, but when I searched my inbox the last one I saw was from April! APRIL!!! I was THREE months late and probably on the verge of being shut off . Needless to say I paid off the entirety of the balance right away (all $280!), and then promptly created calendar items to pop up once a month to remind me to pay it in case the emails continue to fail…

I 100% want to blame the utility company for this as it’s their system that stopped working out of nowhere (it’s been emailing me every single month without fail for years!) but ultimately of course it’s my own responsibility for not staying on top of it. An excellent reminder that you can’t always rely on automation and need to manually check in on things every now and then!

So total lost, with nothing in return except for blogger embarrassment: $47.95

I also recently picked up a few pieces of jewelry on a whim that I regretted hours later, but since I always have a back up plan for stuff I buy, it’s more like early gift shopping for friends ;)

1. Mood ring ($10)
2. Purple bracelet ($6)
3. Vintage looking purple stone ring ($15)
4. Onyx looking ring ($3)

TOTAL LOST GIFTS PRE-PAID: $34.00

(For some reason I’ve been on a jewelry kick alllll summer long! One day I just decided I miss wearing rings, and then next thing I know I’m scooping them up left and right at vintage stores and most times finding great ones (and most importantly, wearing them! I currently have 5 on my hands right now typing this – feels great!))

Here are some of my favorites I’ve picked up so far:

(One of these 4 is actual vintage and the others faux… Can you guess which is authentic?)

So yeah, even your favorite money blogger gets things wrong sometimes :)

On the plus side, it doesn’t totally ruin your day when you’ve been good 99.9% of the rest of the time and can spare some goofs, but still doesn’t feel that great either… In fact, sometimes it feels even worse than market crashes for some reason! Lol… Isn’t that weird?

I “lost” $100,000 of net worth last month, but it didn’t pain me nearly as much as losing this $50 this week! I suppose maybe since the cause of it was *me* and/or I was losing literal *cash money* vs financial pixels on a screen?, but either way pretty stupid how our brains work, haha…

At any rate, $hit happens! We are humans and very good at making mistakes!

And also because we’re human we enjoy hearing other peoples’ mistakes too, so if you’ve made any recently as well do share to make ourselves feel better! Can you beat my $12 box move and steal the Financial Dummy of The Week award from me?!

Let’s goooooooooooo!

[This post, The Financial Dummy of The Week Award 🏆, was first published by J. Money on Elite Edge Money]

Mornin’, mornin’!

There’s a bunch of hype around Robinhood these days and I’ve always been curious about their “free stock” sign-up incentive … So, this month I signed up to see what the fuss is about.

Spoiler alert: It’s a bit of a letdown. The app itself does what it’s supposed to do — trade stocks and crypto in a quick/easy/free way — but the “free stock” incentive is kind of crap, and the overall company mission confuses me.

**This is all my personal opinion, of course. I realize what might not be good for me might be great for others.**

Anyway, here’s my sign-up and “free stock” experience and some other stuff about Robinhood that I recently learned. Let’s start with the good things I really liked …

Signing Up for Robinhood Was the Good Part

First thing I loved was how easy the signup process was. Took about 8 minutes to sign up and everything can be done right through the mobile app.

Everything felt very secure with dual authentication for both email and cell number, as well as connecting to my existing bank account for money transfers. RH doesn’t offer any pre-tax or retirement accounts, so I just signed up for a regular trading account — nothing fancy.

The other thing I like about Robinhood is no account minimums, and no trading fees or commissions. I believe RH was a pioneer in this area and was the first to offer free services like this. But over the past few years many brokers have caught up and offer the same free stuff.

My Take on the “Free Stock” Sign-Up Incentive

The incentive itself is legit. Right after signing up, you follow prompts that let you randomly select 1 free share in a publicly traded company.

But, if you read the promotion fine print, you quickly realize that the odds of getting anything valuable are pretty slim. (Less than a 1% chance of receiving any stock of decent value.) Here are the actual odds:

• Shares with a value of $50 to $200 = 1% chance
• Shares in the $10 to $50 range = 1% chance
• Shares worth less than $10 = 98% chance

I guess I fell in the 98% range, because the 1 free share I received was of a company called Catalyst Pharmaceuticals, worth about $5.80. Yay.

I shouldn’t complain — I’m the same idiot who celebrates after finding pennies on the ground — but I kind of feel like I just fell for one of those Las Vegas casino tricks… You know, the ones where they offer you a “free spin” of the big wheel and it’s all very exciting until you land on the $2 tile. After that disappointment, you feel the need to buy another spin to see if you can beat your last spin, then somehow you leave the casino 45 minutes later $80 poorer than when you walked in.

My Biggest Concern With Robinhood …

Again, I don’t want to say that people shouldn’t use Robinhood as a broker. In fact, we need innovative companies like RH in every large industry to shake things up and modernize processes and interfaces. They’ve done great things for the financial services industry!

However, my biggest red flag is that their platform seems to make it extremely easy for young, novice investors to create harmful money habits. Day trading individual stocks, options trading, and using leverage are notoriously risky investment practices, and are not the tried and true ways to grow wealth.

Don’t you think the average person should solidify their basic financial literacy before experimenting with advanced trading tactics? What about taking advantage of tax advantaged retirement accounts before building up traditional taxable accounts?

Hey, maybe Robinhood will address these priorities one day (better user education and offering retirement accounts) — I can hope, right?! They are still a new company and building their products. With millennials flocking to their platform, I think more responsibility might be needed on Robinhood’s part to ensure their users truly are making good financial decisions.

Who’s Using Robinhood?

• About 50% of all RH users use the app daily. (For some perspective, about 65% of Facebook users log in daily.) RH is highly addictive.
• The majority of RH’s users are millennials. Of their ~20 million customers, the average age is 31.
• Only 24% of millennials possess basic financial literacy! (says PWC).
• 43% of Robinhood’s users have credit scores lower than 650! (poor – fair). This is pretty horrible, but in all fairness TD Ameritrade has a similar stat at 41% (STILT)
• The average account balance for RH is $3,500 (compared with its closest competitor E*Trade at $100,000).
• 46% of Robinhood’s revenue comes from options transactions, which is the most speculative type of trading.

(chart via Scott Galloway, and he has an amazing posts about Robinhood if you want to read his blog further)

All in all, it’s really hard to picture how Robinhood users are building true wealth. The success of the company relies on users making constant transactions — a habit that is proven to erode wealth.

*****

Sorry guys! I started this post intending to write about my “free stock” sign-up experience, but ended up getting into the weeds a bit. 

If you’re a Robinhood user, I’d love to hear what you use the platform for and the benefits that you find over other brokers.  And if any of you were lucky enough to be in the 1% that received free stock with ~$150, gloat away in the comments!

Have a good one,

Joel

[This post, Robinhood’s “Free Stock” Offer Isn’t Really That Great, was first published by 5am Joel on Elite Edge Money]

Tell me if you don’t know people like this…

I just paid off my debt! (You shouldn’t have had any to begin with)

I just invested in my first stock! (You need to diversify more)

I just saved for retirement! (Why? YOLO!)

Elite Edge Money! (No they’re not, they’re boring)

I just rode my bike to work! (You’re gonna get hit by a car one day!)

I just bought a used car! (It’s gonna break down, you know)

I  just bought insurance! (You would have been better off saving it)

I just saved $20.00 doing it myself! (My time is worth way more than that)

I just got a raise! (I just got two)

I just paid off my mortgage!! (You’re an idiot. If you had invested that money in an 18.19% yield over the past 10.3 years you would have had $128,173 more! And that’s without the stock splits!)

I’m about to retire early! (You’re not gonna know what to do with yourself)

I just became a billionaire! (You greedy bastard)

I just donated all my billions to charity! (You know they’re gonna use it for booze and crack)

Haters gonna hate, but you don’t have to.

Keep being your fiscal loving self!

******
 Originally posted in 2015, but the hate is still strong out there… ;)

[This post, What Haters Are Like, was first published by J. Money on Elite Edge Money]

So I’ve had an “interesting” time this week with a popular furniture store chain, and curious to see if I’m completely out of place here or have every right to be as frustrated as they’ve made me lately ;)

Here’s the play-by-play as succinctly as I could make it, though the reality is that it spanned 5 days and 12 different chats between phone, text and Twitter – all totaling approximately 7 hours at the time of this posting.

Thoughts?

• Took the family couch shopping at Ashley HomeStore Outlet
• Picked out a 3-piece set we liked, but it didn’t come with an ottoman so we found another that did
• Spent 10 minutes with the sales rep talking about all the different ways we could use the ottoman to our advantage and absolutely fell in love with it
• Asked the sales rep if “everything we see here” is included – and took a picture of it all which shows everything, including the sectionals, ottoman, pillows, everything.
• Sales rep said yup! All included!
• So I said, “awesome – we’ll buy it!”
• A few days later the delivery men came but one of the pieces was broken so they had to ship it back to get fixed (annoying, but things happen)
• Noticed the ottoman didn’t show up, however, so reached back out to our sales rep who stated he was sorry for the mix up but it was not added to the order
• I asked him if I could just swing by the store and grab it sometime, and he said it wasn’t included in the sales price so it’ll be an extra $300 if I want it.
• I told him I DO want it, but I’m confused and certainly don’t want to spend an extra $300 for something I was told would be included?!
• We debate a bit, and I finally ask him if he has any suggestions before I escalate it up the chain
• He says no, but he’s sorry again for the mess up
• I proceed to call customer service who refers me back to the store
• I call back the store and they don’t answer the phone
• I call back the customer service line (corporate, basically) and they once again refer me back to the store
• They forward me over while on the phone and a representative at the store says they can’t help me as all ottomans cost extra
• I tell them I’m aware of that now, however that was not what was told to me prior to the purchase so I’d like to speak to a manager
• The manager hops on the phone and asks if I looked at the itemized sales receipt before I signed on the line to fulfill the purchase, and I say yes
• He asked if I saw “ottoman” on there, and I say no
• He asks why I continued the purchase then, and I told him I just assumed it was all included – just like the pillows that were not itemized on the sheet however there are 2 of them sitting in my living room right now
• He doesn’t answer me but says I should have said something
• I agree – and tell him it was my fault for not double checking and trusting the sales rep
• He says he’s sorry but would be happy to ship me the ottoman as soon as I pay the $300
• I tell him that’s not going to happen and ask if he has any suggestions before I escalate it further
• He offers to give me a $50 gift card and advised me to take it
• I politely decline, though thank him for trying to work with me
• I call customer service again and ask to speak to a manager there
• They refer me back to the store as all stores are privately owned (?) and they can’t change any pricing or wave fees
• I ask if it’s possible to just return the whole thing then because we can’t come to a resolution
• They say “all sales are final” but to talk to “Bob” at the store
• I ask who “Bob” is and they say he’s “the top manager” at the specific store and is scheduled to be there today
• I call “Bob” and he is not there, but will return on Saturday
• Saturday comes and we finally connect…

Now if you’re still reading this, I’ll stop you there and ask you real quick what you would do at this point so far? ;)

Would you continue to keep fighting it, knowing exactly what you heard and what you were led to believe? Or would you finally just give in and either do without the stupid ottoman or pony up the $300 to complete your set? (Or do you go balls to the wall and do what it takes to get that refund out of principle??!)

I talked it over with my wife, but in the meantime tried one other avenue that has been known to work from time to time… And of course that avenue is taking it to social media ;)

• I private message my concerns on Twitter (@AshleyHomeStore)
• I receive no response back
• I find their “customer care” handle (@AshleyHomeHelp) which states “a community manager is actively listening between the hours of 9-5pm EST” and send them a private message there too
• I receive no response back
• I send a *public* message tagging them in case that gets their attention which said: “Anyone ever have issues with @AshleyHomeStore ?! Ordered a brand new couch for the first time in my life and having a dickens of a time getting what I paid for… (after of course spending 2 hours bouncing between customer service centers )”
• They respond! “We’re sorry for the delay. Please send us a PM with your contact information, store location and confirmation, so we can see what the holdup is. Thank you, Sandy”
• I respond with the info requested
• I receive no response back
• I follow up a couple days later, both privately and publicly
• I receive no response back

¯\_(ツ)_/¯

UPDATE: Just got a response from Twitter today – what are the odds? ;)

The Mrs. and I finally decide where our limits are and how far we want to push this, and if we’re able to get the ottoman at a severely discounted rate we’ll still take it as it’s what we really wanted to begin with, but if they continue to not budge we’ll go all out for a refund.

Which sucks because that’ll be a much harder battle to fight, what with the “no return policy” aka the worst customer service policy ever. And after researching it more and learning of possible “restocking fees” and the fact places rarely return *shipping* costs either, we’d have to commit for the long haul.

And then Saturday came!!!

And do you know what happened?!

“Bob” called me!! Before I could even call him! Here’s how it went down:

• He calls us and immediately apologizes for us having a bad experience so far (thank you!!)
• He tells us their sales rep’s side of things, but states it doesn’t even matter because at the end of the day we’re unhappy and it needs to be fixed (which was nice to hear, especially as the rep’s story has now changed for a third time)
• He says he’d love to resolve this right here on the phone and offers to give us the ottoman at “cost” if we still want it – which comes out to $150
• I tell him I think that’s a fair compromise and he adds it to our scheduled shipment of our broken-but-now-fixed other part of the couch
• I thank him for resolving it once and for all :)

So a somewhat happy ending to the story, though definitely not going to be taking the chance again with them in the future, haha…

But what do you think? Would you have taken the deal or kept fighting? Was I in the wrong here or could you relate? Have you ever had any experiences w/ Ashley before, good or bad?

I debated on whether to even share this publicly or not, but after the failed attempts on social (and giving them ample opportunity to talk with me!) I felt it was something worth mentioning in case it helps just one other person avoid this frustration down the line :(

Super great couches and prices there, but not the best customer service in the world.

Though to be fair, when I asked the community about them some of you did say you’ve had great experiences with Ashley, so perhaps I was just unlucky ;) Along with the few others who also had not so great experiences with them… (you can see the chain here if you’d like)

At any rate, upward and onward! One less thing to have on the brain now!

*******

6 MONTH UPDATE: One of the best decisions we’ve made :) Kids absolutely love it for fort building and couch jumping (despite us outlawing it!), and then we love it for a comfy place to put our legs as it’s so big that it basically gives our couch another chaise lounge on that side of it. The only downside is that it’s one more thing to clean, haha…

[Pic up top by ambermb via pixabay]

[This post, Our new couch battle – am I in the wrong?, was first published by J. Money on Elite Edge Money]

Last week, 3 different people emailed me asking for advice because they keep getting pressured by friends and family (especially family) *to buy a home* when neither one of them wants to.

I got so riled up after the last message that I shot the following tweet out which caused quite the hubbub for a hot minute or so:

As it turns out, I wasn’t alone in this thinking.

Here were some of the messages and stories I got throughout the day:

********

“Being already buried in ton of debt didn’t even shield me from the house shaming. It doesn’t stop. The stress of getting out of my existing debt has soured me on taking out a mortgage so I’ve developed Teflon skin about it now.” – @DoubleDebtWoman

********

“This is so true. Everyone wants you to buy a house. But guess what? Only YOU are paying for it. Your rent is the most you’ll pay per month for shelter while your mortgage payment is the least! Taxes, reno’s, repairs, taxes — homeowners have costs beyond a simple rent payment.” – @SquawkFox

********

“Please keep preaching this message. A house does not make you wealthy. Money and net worth makes you wealthy. Can a house purchase be a part of a good financial plan? Yes. Is it essential? No. You need a roof over your head. I know lots of winners who rent. Lifestyle choice!” – @BuildFMuscle

********

“We get so much about this from family and we own a large two bedroom condo in an expensive city! It’s not just rent shaming – it’s non-house shaming too.” – @LeighPerFin 

********

“We pay a shit ton for a furnished rental and we’re happy as larks. Amazing neighborhood, awesome landlord, amenities we’d never pay for on our own (saltwater pool, hot tub, prof home gym, chickens), and ZERO RESPONSIBILITY. Freeeeeeeeeedom!!!” – @HardlyWarckens

********

“I was totally #houseshamed into buying my house way back when…. now we live in an Airstream. Apparently we have thicker skin now ;)” – @AStreaminLife

********

I get people wanting to help those they love, but after the first or second mention it’s time to back off and let them live their own lives! (Unless specifically asked!)

We all know what YOU would do in our shoes – but you’re not in our shoes, and you don’t fully know our situation/dreams/desires either. You see a sliver of it, but fortunately there are many different routes to happiness.

And for what it’s worth, I’m not even *against* home ownership at all! I actually think it’s an enormous benefit to people, and I give everyone mad respect for going after it if it’s what they truly want in their lives. And even more so, for paying it off early! The takeaway there though is “what you truly want in your life” – and spoiler alert, not everyone wants to own a house. Or have a car, bicycle, iPhone, video game, kids, wife, dog, TV.

There’s plenty of stuff to occupy and improve our lives, and thank GOD we live in a country that affords us such freedoms without fear or worry of incarceration! We should be so lucky!

So please, for the love all things holy, stop the shaming.

• Stop shaming people into buying homes when they’re not ready
• Stop shaming people into buying new cars if they don’t want them
• Stop shaming people into going to college (or not going to college!)
• Stop shaming people into saving instead of going out partying/traveling with you
• Stop shaming people into early retirement if they’ve been smart enough to figure out how
• And just overall stop shaming people into anything else they’ve consciously chosen to do in their lives, regardless of whether you approve of it or not

If you see someone making a mistake, say your piece and then let your loved ones figure it out on their own. If they choose wrong, you’ll be there for them when they come back asking for help, and if they choose right – then maybe consider re-assessing your own views and see it as an opportunity to grow yourself! We’re not always as smart as we like to think we are! ;))

A 4th message came in as I sat down to finish this post, and the last few lines of it just filled me with so much pride and lightened up my entire day:

At Easter my boyfriend’s aunt was asking me why we hadn’t yet moved in together yet, to which I responded “I want to pay off my loans first.” To my surprise, I found myself defending my decision to a table full of 50+ year olds about the possibility of financial independence. They responded with things like “there will always be something that comes up,” or “you’ll always be paying off something” – to which I confidently said “But why should that be the norm?” That made me feel so strong. It made me feel confident, like I had all the answers, which for once I’m okay accepting that stereotype of millennials – because in this instance I think it was warranted :)”

She went on to say that she’s never been so happy and confident with her decisions and conversations around money since finding $$$ blogs, and is now finally able to “really understand the meaning of financial stability” and the role it plays in both her life and relationships. And she’s certainly walking the talk too, just about killing $60,000 of student loans which will be cleared away completely next month – exactly 3 years after her graduation.

You do your thing, girl! Own that life of yours!!

And I hope all you reading this will also embrace your beliefs and strive for everything you want deep down inside. Only YOU know what you want most out of life (sorry, moms!), so stick with your heart, do your best, and then brush those shoulders off whenever you fall. Which you will, but better to fail doing something you want vs failing doing something others want.

This is your life!! Stay true to yourselves!!

[This post, Stop The #HouseShaming, People!, was first published by J. Money on Elite Edge Money]

So we just had an exciting week!

After multiple confirmations over the months that we can continue to rent our house until the end of the school year, our landlords decided to kick us out anyways, despite how pregnant my wife is or the slew of promises that we had planned our life around.

And let me tell you – if you ever wondered how to piss off a pregnant lady, this is how to do it ;)

What changed? Their realtor said they have a better shot of selling it for more money if they list it in the Spring vs the Summer (we knew they wanted to sell, but only after we moved out in June), and hours later we got the boot without much room for negotiation whatsoever. And because we were on a month-to-month lease (oops), they had every legal right to do so.

Now ethics wise it’s a whole other story, and we’ll get to that in a bit, but the GOOD news is that we miraculously found a new place within days of looking – even with a slow rental market and it being in the middle of winter!! So crisis averted for now, but what a whirlwind of emotions, wow.

And I know you home owners right now are just shaking your heads thinking this is exactly why you own, haha…, and rightfully so, but it’s still not enough to get me to switch back quite yet ;) I’m just chalking it up to finally being my time to deal with some of the nastier sides of renting after years of bliss!

Anyways, here’s a look at some of the perks of our new place, just to keep things a bit positive up in here. And now that the chaos is over, I’m actually starting to get a bit excited about it!

• We’re going from 1,100 sq ft to 2,500 sq ft (which is a welcomed change, not gonna lie… I thought I could do small-home living with a family of 4, but it’s a lot harder than it sounds! Haha… We got through okay, but I’ll be glad to have some extra space again…)
• Has 4 bedrooms instead of 3 (maybe room for an office finally?)
• 3 bathrooms vs 1 (<– my wife’s favorite part)
• Bigger backyard and play room (<– kid’s favorite part!)
• Much more open and SUNNY! (<– cat’s favorite part ;))
• Private driveway vs street parking
• And then MY favorite part –> It’s right down the street from the school so I can WALK MY SON THERE every morning!! Which is something I’ve always wanted to do! We’ll have to move him out of his current school since we’re now gonna be in a new district (literally couldn’t find one house under $2,600 in his current district – crazy!) but it’s just as nice a school, and fortunately he’s great at meeting new friends…

So by and large we’re turning lemons into lemonade here, and will probably enjoy our new home even MORE once we’re settled and everything calms down… And it will be nice not having to deal with moving *after* the baby is born too. As for price, it’ll cost us about $100 more a month now ($2,300 vs $2,200) which is still ridiculous, but we did manage to negotiate it down by $100 which is something?

(A funny aside to that btw – I  had originally put down our *entire net worth* in our application thinking that it would showcase how solid we were, however after my wife scolded me for “showing them our cards” and wiping away all chances for a discount, I scaled it back by a good 80% and sure enough it did the trick :) First time I’ve ever had to lie in *that* direction to get something I wanted! Haha… And another win for stealth wealth too – BOOM.)

I still can’t wait to move back to my beloved Virginia though, but Mrs. eliteedgemoney promises this is our last year here in the DC area, so 16 more months to go and then it’s back to the promise land… The things you do for love (and career!).

House stuff aside though, I’d love to get your opinion on the *ethics* part of the equation here. And it’s something that affects so many different parts of our lives too, and is good to draw the line NOW before future situations arise and you accidentally choose the path that goes against your true values.

And the question I’d like to pose to you is this:

At what point do you choose what’s best for YOU vs what you’ve promised others? Or more specifically to this situation – when does the *money* outweigh your *integrity*? Or does integrity not even matter in such business deals?

Personally, I know myself well enough that I couldn’t ever screw ANYONE over even if I wanted to regardless of the financial benefits, because I’d just be too riddled with guilt! And that’s before even bringing a pregnant person into the picture, haha…

Now of course, if we’re talking about a lot of money here that doesn’t mean I wouldn’t try to work *something* out to be more beneficial to everyone, because it certainly doesn’t have to be so cut and dry, but at the end of the day if it put my people in a $hitty situation I’d have to draw the line there and just suck it up.

Because after all, as the landlord *I* was the one who made the bad call earlier for not figuring out this stuff in the first place! These jokers had alllll the time in the world to research and consult with realtors, they didn’t have to wait until the last minute and put everyone in a tight spot?! We’re not mad because we have to move out, we’re mad because of the way it was handled and the fact they were such dicks about it all. Which you know is bad if *I’m* the one calling someone that as I love everyone, haha…

So yeah – that’s where I stand, anyways. But of course I’m probably biased ;) What about you though? What would you have done if you were our landlords? Kicked us out because business is business, or shown a little compassion and at least tried to work something out for everyone?

On the flip side, how would you have handled it if you were US – the renters – getting the boot? Would you have fought back and challenged it, or just do your best to move on and make the best of a crappy situation? In the end of course that’s what we chose to do as we were glad to just be done with them once and for all (it wasn’t the first time we’ve had a bad experience with them), but curious to hear your thoughts and maybe even learn something today… Especially if you side with them on all this! :)

We’ll see how it plays out in the end, but hopefully it’ll be a blessing in disguise and we can look back at it later and just laugh at it all :)

Now time to get to packing and be thankful for all the decluttering we’ve done over the years, boy… The one nice thing about living in a smaller house is that it forces you to get rid of all the fluff! And we’ll now have to make sure we don’t regress and expand again moving into a place double the size too…

Thanks for listening and letting me vent a little today, guys… Always nice to have an outlet for that :)

XOXO

[This post, When Your Landlord Kicks You Out of Your House…, was first published by J. Money on Elite Edge Money]

[As part of our weekly column by Mr. 1500 of 1500Days.com – a fellow blogger who retired at 43!]

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My cover as a blogger was blown last year when a story about us went viral.

I knew something was wrong when the blog went down. When it finally came back up, I had over 30,000 page visits and it was still before noon. On that day, we weren’t so anonymous anymore.

We then started getting texts from friends and relatives:

Hey, you’re on Yahoo!

You have a million dollars? What???? Huh??

To my surprise, it turned out to be a much less painless experience than I had assumed. No one asked us for money. No one treated us any differently. I was hoping that the article would trigger some interesting conversations about money, but that didn’t happen either.

Life moved on. Except for one person who did want to talk money.

Aunt K Loves Her Job!

One family member was excited to learn about our secret lives. The first conversation took place last year when we had the big publicity. It went something like this:

• Aunt K: That’s so awesome that you’re planning to retire! Congrats!
• Me: Thanks! How about you? At what age do you see yourself retiring?
• Aunt K: Not any time soon. I absolutely love my job. I’d do it for free! I’d like to retire, but probably not until 65.
• Me: That’s wonderful! If you’re doing what you love and you happened to get paid for it, that’s hardly working.
• Aunt K: I know! It’s amazing.

Unfortunately, Aunt K’s bliss was not to last. A couple months ago, we saw her again and she was singing a different tune. While Aunt K loves her core job, there are other problems. She works in a school district that has issues with administration. The state that she teaches in is also mismanaging the teachers’ retirement fund, so she’s worried that all of the money she’s saving may be blown by politicians.

I feel bad for Aunt K. She loves teaching, but the circumstances around it have changed. Just last year, saving money wasn’t a priority and she dismissed the idea of financial independence. Now, she worries that she’ll never be able to stop working when she’s finally ready to.

Excuses, Excuses, Excuses

I hear folks making excuses for not saving All. The. Time. Here are some of my favorites.

“I love my job!”

Aunt K’s excuse is the most common one that I hear. If you love your job, that’s awesome! What an amazing gift in a world where many folks dread their 9-5! You’ve got something wonderful there.

However, will your job always love you? Plenty of folks who worked at Enron loved their jobs too. There are always other factors at play. Robots and artificial intelligence are going to start taking more and more jobs. This will be a major societal change that you don’t want to be on the wrong side of it.

“I’m going to die young.”

This is the favorite excuse of a good friend. He insists that he will die before he’d ever retire, so he doesn’t save. I’m not sure why; both of his parents are in their 90s and he has no serious health problems.

And why would you want to bet on an early death anyway? What’s the backup plan if you don’t die?

“The money won’t be there for me anyway, so why bother?”

Bad things happen to good folks. Maybe you know someone who retired in 2008 right before the Great Recession clobbered us all. Maybe a family member got taken by a Bernie Madoff character. This stuff happens, but not to most. Put your money away and stop worrying.

“I could never do that.”

A friend recently lamented her financial position:

We have nothing saved!

I replied with:

Get rid of the new SUV.

And:

Rent your mother-in-law apartment on Airbnb.

And:

Take local vacations instead of exotic ones.

Every single suggestion was met with the same response:

I could never do that.

Well, I hope you plan on working until a ripe old age because you know that whole retirement thing? You’re never going to be able to do that.

Money doesn’t matter. Until it does.

My mantra in life is this:

Hope for the best, but prepare for the worst.

Optimism is the only way to go through life. And a little preparation can make you a better optimist. Because I’ve taken care of myself financially, I’m prepared to deflect the curve balls that life throws at me. Money doesn’t matter most of the time. But when it does, and you don’t have it, it’s going to hurt.

To the folks who make excuses for not saving money, I say this:

Financial independence isn’t about quitting your job. It’s about options. If you love your job, stay there. It’s much better to work because you want to than because you have to!

And also:

You get nowhere running on the hedonic treadmill. Stuff doesn’t bring long term happiness. Spending time with loved ones and meaningful activity does. A frugal, simple life is the most efficient and rewarding way to live.

If there is anything true about life, it’s that it’s an ever changing, unpredictable journey. If you would told me 5 years ago that I’d no longer be programming computers or have a job, I would have thought you were crazy. But, the serendipitous turns of life are what makes it fun and interesting.

Just save some money so you can embrace the fun opportunities when they present themselves. Save enough so you never have to worry. Money doesn’t matter. Until it does.

[This post, Money Doesn’t Matter. Until it Does., was first published by Mr. 1500 on Elite Edge Money]

[Sup y’all! Please enjoy this fun little ditty by resident blogger Lance who likes to stop by any time he thinks we need a quick kick in the ass ;) You might remember him from our Financial Confessional Series or perhaps his beautiful classifieds around Valentine’s Day. He’s got no shortage of opinions!]

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Ever have a friend or co-worker that emotionally drains you every single time they’re around? The second they come through that door you just cringe and pray they don’t come sit by you and start a conversation? Yet for some reason we continually put up with it?

That is debt.

Instead of cringing at the sight, the world has taught us that debt doesn’t really hurt us and that we should in fact embrace it like a kind friend who is helping us get what we deserve. Then later when the bill comes, that same kind friend surprise attacks you right in your financial back with a dull rusty knife.

What Debt Should Truly Look and Feel Like

Have you ever hit a skunk while driving on the road? I never have, but I’ve seen a few dead ones and I’ve smelled even more heading down the highway.

Debt is like hitting one of those skunks on the road, stopping your car, picking it up and licking it to see if it’s still alive, then putting it on your lap and taking it to work with you and then back home where you place it on your pillow and spoon with it all night long.

Debt is a stink that doesn’t go away, yet we’re so willing to incorporate it in to every aspect of our lives!

How can something that seems so normal… be so wrong?

How can something feel so good up front… then penalize us so harshly in the end?

Here’s a poem for you. Print it out and put it in to your wallet to remind you just how two-faced debt is:

“An Ode to Debt – How It Loves You and Hates You”

Debt is a neighbor that borrows your tools and never gives them back.

Debt is a soft comfortable blanket that makes you feel so good, only to discover when you get up you are covered in cat hair.

Debt is a friend that visits every day and consistently kicks you in the crotch as you just lay there smiling on the ground saying, “that’s okay, see you tomorrow.”

Debt invites you to go out to dinner on their dime but forgets their wallet.

Debt is your other neighbor who asks for help to move, and then when you show up has nothing packed or ready to go and expects you to do most of the work for them.

Debt is your boss that tells you you’re in line for a huge promotion and raise that you excitedly tell to your family about, only to see your boss leave the company the next week and the new boss give you the pink slip.

Debt is your sister-in-law who borrows your Redbox and says she’ll take it back before 9 pm and then doesn’t return it for 31 days.

Debt is your buddy who asks to drive your new car and then jumps the curb.

Debt is your fiancee who leaves you standing at the alter.

Debt is your child who decides to use your bathroom to take a dump right before you planned to take a nice long bath.

Debt is your air conditioner that breaks down on the first 100 degree day of the year.

Debt’s brother is the air conditioner repairman who says it’s going to cost way more than he originally quoted you, then tacks on five extra days while he “waits for the parts to arrive.”

Debt sleeps with your spouse, and on the way out of your house asks if you want to play golf the next day.

Tell me again, why do we love debt so much?

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Lance is a former blogger who loves talking about money, but hates running a blog. We’ve given him a spot here anytime he has something juicy to say ;) You can find him on Twitter @Lance_Finance.

Other Posts from Lance:

• You’re Hot, But Your Finances Are Not!
• Financial Confessions: “I Became So Obsessed With Being Rich That I’m Now Sitting in Prison”

[This post, An Ode to Debt, was first published by Guest Author on Elite Edge Money]

[Hey guys! Have a feisty one for you today from fellow blogger ERN at EarlyRetirementNow.com. Some of these you may disagree with, as do I (no emergency fund? Blasphemy! ;)) BUT I always love hearing other peoples’ perspectives, and Ern here can surely put up a convincing fight. Regardless of where you stand though, I hope you’ll find some takeaways here to help you in your own journey.]

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As members of the FIRE (Financial Independence, Retire Early) community, we are all nonconformist. We scoff at conspicuous consumption of our neighbors in their full-size SUVs and McMansions, and instead budget with a very sharp pencil (spreadsheets are fine, too) and grow our stealth wealth, one dollar at a time.

But the FIRE community is far from monolithic. For example, I consider myself nonconformist even inside our nonconformist movement! I hold some pretty strong non-consensus views on many financial topics. I’m a rebel among the rebels, imagine that!

Here’s a list of my seven favorite disagreements with the personal finance consensus:

#1: The 4% Safe Withdrawal Rate is safe! (No it is not)

The Trinity Study and the resulting 4% recommended safe withdrawal rate have become the gold standard when designing a savings target (25x annual spending) and the eventual withdrawal strategy. Even J$ here uses it. There are (at least) two problems when extrapolating the Trinity calculations to the early retirement community.

First, instead of a 30-year horizon in the Trinity Study, the average early retiree faces a 50-60 year horizon. That wouldn’t be a problem if the success criterion in the Trinity had been capital preservation, i.e., preserving the purchasing power of the initial portfolio value for 30 years. If your capital lasts for 30 years, then why shouldn’t it last another 20-30 years? But for the Trinity Study, even a portfolio value $0.01 after 30 years is considered a success. That one cent will not last another 20-30 years!

To gauge how much of a “haircut” we should apply to the 30-year safe withdrawal rates when extending the retirement horizon, let’s do the following thought-experiment.

Imagine we have a $1m portfolio that generates 4% p.a. (per annum) of real return in the long-term, but we got unlucky and suffer 10% losses for the first three years, followed by three years of 10% gains and then 4% returns after that (assume all returns are real and all withdrawals adjusted for inflation). That’s not even a worst-case scenario, more of a garden-variety bear market.

Our portfolio can then sustain a withdrawal rate of about 4.27% p.a. for a 30-year horizon. But over longer horizons that number will be significantly lower: Only 3.26% over 60 years, a whole percentage point less and that’s all because of the longer horizon!

[Figure 1: Path of portfolio values over 30, 40, 50, and 60-year horizon with different withdrawal rates, targeting capital depletion.]

The second objection is that today’s expected asset returns are significantly lower than the average returns observed since 1926. The Trinity Study averages over many decades with different financial market regimes. Sometimes the stock market was overvalued, sometimes undervalued. Sometimes bond yields were very high, sometimes they were very low.

Does anybody else see a problem with that procedure? Relying on safe withdrawal rates that are averaged over the past 90 years is a little bit like calculating the probability of getting into a traffic jam by averaging over the entire 24 hours of the day. That may not be the most informative figure if you already know that you will be driving during rush hour!

For today’s retirees, only today’s market conditions matter, not the averages over the last 90 years. And more than seven years in the current economic expansion, equities look more expensive than over the last 90 years (measured by the CAPE ratio) as I show in this blog post. Bonds don’t look too hot either. Since 1926, the real, inflation-adjusted bond returns were solidly above 2% for government bonds, and even above 3% for corporate bonds, but today’s yields are far lower. Lower bond yields and expensive equity valuations support only significantly lower safe withdrawal rates than 4%.

If 4% doesn’t work, then what’s the alternative? Personally, I plan to start with a lower withdrawal rate of 3-3.25% out of our equity portfolio to account for today’s expensive valuations and the long retirement horizon. Having income-producing assets with a less than perfect equity correlation is also a good idea, so, I started moving some of my investments into rental real estate. Owning rental properties with a 4%+ rental yield (after all maintenance and repair costs!) I can probably push the overall withdrawal rate to 3.5%.

This number, though, is not set in stone. If the CAPE ratio were to drop to a more normal level, say, under 20 (currently around 27) I could move the withdrawal rate closer to 4% again.

#2: Robo-Advisers are great! (If by “great” you mean “expensive”)

You can’t read through the personal finance blog world without finding glowing endorsements of Robo-Advisers, like Betterment and Wealthfront. I beg to differ though, and recommend Robo-Advisers only to my most financially disinterested friends.

But folks in the FIRE community? We are the masters of budgeting and frugality, financial hackers (not hacks) and always on our toes to find new ways to eke out a basis point (0.01%) of return. Why would we want to throw away anywhere between 0.15% and 0.35% in fees p.a.?

Robo-Advisers do nothing magical and are nothing but expensive gimmicks. You can go to their website, find out their recommended asset allocation and simply implement it with inexpensive index funds at Vanguard or Fidelity. But do you even want to use their recommended asset allocation? You could do significantly better by further hacking their recommended allocation, for example moving ETFs with a high dividend yield and taxable bonds from taxable to tax-deferred accounts.

But what about tax loss harvesting? Tax loss harvesting is a neat tool that can lower your taxable income by up to $3,000 p.a., so folks in high tax brackets can save $1,000 or more on their annual tax bill. In taxable accounts, simply sell your underwater investments, i.e., equities, ETFs and mutual fund shares that have a cost basis greater than their current value, and the loss can be used to offset up to $3,000 of ordinary income per year. Check Bogleheads for more details.

Robo-Advisers can do this process really well and in a systematic and automated fashion. But apart from the fact that we find Tax Loss Harvesting overrated (see #7 below), it’s also something that most investors should be able to do themselves. Here’s my guide to becoming your own homebrew Robo-Adviser. Do it yourself and save thousands of dollars over the years!

Finally, under no circumstances should anybody ever shift an existing brokerage account with sizable capital gains to the Robo-Advisers, because they might first liquidate your holdings to purchase their recommended ETFs.

And that’s true whether you are an experienced financial hacker or complete finance novice. I’ve saved $42,000 by not switching to Betterment! The tax bill could be so excessive you’ll never recover the loss even under the most optimistic assumptions for harvesting future tax losses.

#3: Everyone Needs an Emergency Fund! (Not everyone)

The almost universally accepted wisdom is that not only do we all need an emergency fund, but building that emergency fund is the number one priority of personal finance, taking higher priority than saving for retirement. Some even want you to start an emergency fund before paying off high-interest credit card debt. That’s nuts!

I laid out our plan for having no emergency fund (featured on RockstarFinance on 5/25/2016!) and two follow-up posts as well to debunk some of the common arguments in favor of the emergency fund. With our savings rate of 60%+ we are usually able to finance all expected and unexpected expenses out of our current cash flow.

Just to be sure, I’m not saying that anyone should forego savings altogether. An emergency fund is better than having no savings at all. I merely take offense in keeping large amounts of money in unproductive, low-interest money market accounts. I consider our entire portfolio our emergency fund and like to put our hard-earned dollars where they can work harder for us: in equity and real estate investments.

Am I not afraid of having to dig into an equity portfolio right when the market is down? Yes, to a degree, but as a passive investor, I try to stay away from timing the market. Keeping cash on the sidelines for fear of a market decline exactly coinciding with a cash flow need is market timing on steroids!

#4: Use bonds to diversify equity risk. (Don’t get your hopes up too high!)

What was the correlation between an all-equity portfolio and a portfolio with 80% equities and 20% bonds over the last ten years? 0.998. For all practical purposes, that’s a correlation of one.

To be sure, the 80/20 portfolio has a lower volatility; pretty much exactly 20% lower. But that volatility reduction came from the lower equity weight and had little to do with bonds reducing risk. In fact, simply keeping the 20% in a money market account would have achieved that exact same volatility reduction. That said, bonds delivered very nice average returns over the last few years, so the appeal of an 80/20 stock/bond portfolio came mostly from better returns than investing 20% in a money market account.

But that could change in the future; yields have been heading higher since November 8th, and bonds could have a rocky road ahead of them. In addition to having little diversification, they could also lose their potential to boost returns.

#5: Bonds are safer than stocks. (Depends on the horizon!)

Of course, stocks tend to have higher daily, weekly, monthly, even annual volatility than most bonds. No discussion about that. So, for folks with a very short investment horizon stocks may seem unattractive. But over a 50-year investment horizon, we should weigh the short-term volatility with the long-term sustainability of funding our expenses in retirement.

There have been extended periods of very poor bond returns. For example, there was one 80-year window (!) of zero real (inflation adjusted) bond returns from about 1900 to 1982. True, equities can be volatile in the short-term. You see overreactions both on the upside (late 1990s) and downside (2009). But equities normally return to a long-term trend growth path within a few years, see chart below.

Bonds, on the other hand, can move sideways for many decades. That’s poison for the retiree who relies on a nest egg to last for half a century! And what’s worse, the spectacular run of good bond returns that started in 1982, might be overdue for a reversal as has happened with the other two bond bull markets in the late 1800s and 1920-1940. I’m not saying that this will start now, but bonds did get crushed after the spike in interest rates since November 8th!

[Figure 2: Which one is the risky asset now? Cumulative real total returns (CPI-Adjusted) of the S&P 500 and 10-year U.S. government bonds. January 1871- December 2015.]

So, to stay with our “financial rebel” theme, just like our American Founding Fathers preferred “dangerous liberty over peaceful servitude,” this writer likes dangerous equity volatility more than running out of money for sure with low volatility bonds!

#6: Cash serves as great bear market insurance in retirement. (Think again)

The idea sounds almost too good to be true: simply keep a few years’ worth of expenses in a money market account, enough to fund expenses during the occasional bear market, and we never have to worry about market volatility. Unfortunately, it is too good to be true.

The first issue is opportunity cost. The cash cushion is a little bit like leaving the house every morning wearing a Robin Hood costume, just in case I might come across a fancy-dress party that day. That strategy works beautifully every year in late October, but it would be a bit of a burden for the rest of the year. Likewise, the opportunity cost of carrying too much unneeded cash when there isn’t a bear market can compromise the average portfolio return. Remember, timing Halloween parties in late October is easier than timing the next bear market!

But even if you do get lucky and have the cash cushion ready to go at the onset of a bear market, it’s not going to make much of a difference. If you were unlucky and started your retirement too close to the market peak in 2000, then with or without the cash cushion your retirement portfolio would have been seriously compromised; we are talking about “going back to work” compromised! True, the portfolio with the cash cushion would have been slightly less compromised than an all-equity portfolio, but still seriously underwater. The cash cushion is no panacea because you will have to replenish the cash cushion right around the time when the stock market rallies again.

One way or another, opportunity costs will catch up with you! It’s very simple: there is no true bear market insurance. A good start would be using a lower withdrawal rate (see #1 above) and being prepared for plan B, plan C, and all the way to plan J (Money).

#7: Tax loss harvesting saves you a ton! (It’s nice, but you won’t get rich)

As mentioned above, I do the tax loss harvesting by hand without any help from the Robo-Advisers and my guide on how to be your own Robo-Adviser has a lot of the details on how to do this right.

Did I become rich from tax loss harvesting? Absolutely not! The claims of 0.7% or even north of 1% of additional annual returns from tax-loss harvesting claimed by the Robo-Advisers are vastly exaggerated. If you are like me your taxable portfolio is the result of many years of regular investments. So, even a bear market with a 20%+ drop right now would result in much less than 20% harvestable losses. I have some tax lots that would require a 50%, even all the way up to 70% drop in the stock market before generating even a single tax loss dollar.

My personal estimate is that I have generated less than 0.10% in additional annual return from tax-loss harvesting so far. Going forward, especially once I retire, the benefit will likely go away altogether.

I put together some calculations on how much extra return you’ll likely generate depending on different marginal tax rate scenarios and portfolio sizes. Under most realistic assumptions, the benefit is even lower than the 0.15% to 0.35% Robo-Advisers fees. It’s a benefit large enough to not leave on the table, but don’t get your hopes up too high. And don’t pay anyone 0.35% p.a. to do it for you, either!

I’ll now be taking all questions and concerns below :)

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About the author: Mr. ERN runs the EarlyRetirementNow blog where he writes about his path to early retirement, planned for early 2018. He currently works for a large asset management firm and holds a Ph.D. in economics.

[Top photo cred: hobvias sudoneighm]

[This post, My Top 7 Disagreements With Personal Finance Experts, was first published by Guest Author on Elite Edge Money]