Category: General

An 800 FICO credit score is an exceptional credit score. If you have an 800, you’re pretty much set when it comes to anything requiring credit. (the max is 850)

You might think that an 800 is hard to get but it’s actually not that difficult. It does, however, require you to avoid mistakes and our first post discusses what he’s done to achieve this (including debunking a few myths).

How to Maintain an 800 Credit Score Without Staying in Debt [Financial Pilgrimage] – “One of the myths of having a good credit score is that you must carry a balance on your debt every month. This simply is not true. In fact, if you read on you’ll learn more about how we continue to maintain an 800 credit score despite being completely debt free for two years.”

Social inequality: Why you need to become financially privileged NOW [Five Year FIRE Escape] – “There is something I have been noticing lately on my financial journey. There’s definitely social inequality, and life isn’t just easier when you have money. Life is WAY easier. Unfairly easy. Covid has made this painfully obvious to me.” Easier said than done… but it does highlight how COVID is hitting people differently. (it’s a broader post than about the pandemic)

Roth 401K Withdrawals [The FI Tax Guy] – “The Roth 401(k) is still a relatively new account. Taxpayers and practitioners alike are still learning its contours. Things get even more complicated when you roll money from a workplace Roth 401(k) to a Roth IRA.” A quick(ish) explainer if you’ve been thinking about a Roth 401(k).

With a garden at home and plenty of goodies from our local CSA, my wife and I have been eating more salads than usual. If you’re looking for more inspiration, here are some ideas:

20 Rules For Making the Best Salads of Your Life [Bon Appetit] – “It was puzzling at first: We’d go to a restaurant for the grass-fed strip steak or sourdough pizza but leave thinking about the salad. Sky-high towers of leafy greens, flat wisps of multicolored radishes, Caesars of all styles. We wondered: What were chefs doing to make salads so…exciting? Turns out we had a lot to learn.”

See you tomorrow Apexian!

Yikes.

Here I thought my mention yesterday of the Oregon wildfires would be a “one and done” thing. After all, the winds were shifting and surely the fires would begin to fade, right? Wrong.

Now my brother’s family has been evacuated from the town where they live (population 9235)…and my family’s box factory is in the danger zone. Kim and I are still safe, but who knows what’s going to happen? Scary stuff, man.

To get my mind off of things, let’s look at some interesting stories from around the web, shall we?

The eight secrets to a (fairly) fulfilled life. [The Guardian] — “You needn’t berate yourself for failing to do it all, since doing it all is structurally impossible. The only viable solution is to make a shift: from a life spent trying not to neglect anything, to one spent proactively and consciously choosing what to neglect, in favour of what matters most.”

“I am so over productivity porn!” [Bitches Get Riches] — “Nobody is going to punish you for failing to start a container garden during quarantine or not training to run a marathon. I fucking promise you. You know yourself better than anyone else does. Do what makes you feel healthy, happy, and secure. And ignore the goddamn productivity porn.”

Why do people stay poor? [Of Dollars and Data] — “The fact is that money begets money. In investing we all know this to be true, but these empirical studies suggest that this is also true in the labor market. Without financial resources people find it incredibly difficult to get the skills and training to get ahead. I know this all too well as a first-generation college student who was fortunate enough to have their tuition paid for by a need-based scholarship.”

Let’s end things today with a money-related music video! Here’s “Broke” by Teddy Swims. I’ve never heard of him before, and I’ve never heard the song until now. But it’s funny!

Okay, don’t mind me. I’m headed back to get updates on the wildfire situation. Last I heard, they’re actually pulling firefighters off one of wildfires. Meanwhile, the largest fire in the area is zero percent contained.

Yikes.

Well well, this week is a mess at Apex Money isn’t it? I apologize. Real Life has reared its ugly head. Here outside of Portland, Oregon, we have some highly unusual wildfires raging. So, I spent my yesterday making emergency preparations in case of natural disaster.

Fortunately, all is well so far. Kim and I are safe. My mom had been evacuated from her assisted-living facility. My brother and his family have voluntarily evacuated…and their home will apparently be okay. Winds are shifting, which will sharply reduce the advance of the fires toward populated areas.

But enough about me! Let’s talk about money. Here are some great recent links from around the web…

Stop comparing yourself to others. [One Frugal Girl] — “I’ve compared myself to others my whole life…Now, in my early forties I have a better understanding of myself and those around me. I know that life is not a race. If it were I would be heading away from the crowd of runners. We don’t all need the same things out of life. We don’t have to covet the same goals either.”

Stop comparing yourself to your past self. [Tawcan] — “Stop comparing yourself to the past self. If you keep doing that, you will never move forward in your life. Get over the past mistakes, learn from them, and make decisions based on what you know today. If you make more mistakes, rinse and repeat!”

Don’t worry about where you should be. Stay in your lane. [Humble Dollar] — “Perhaps one of the first micro-actions we can all take is removing ‘should’ from our vocabulary. It’s such a limiting construct. Playing to someone else’s scoreboard is easy, which is why a lot of people do it. The harder thing—playing our own game—begins when we turn our focus and energy toward what we’re capable of and how we can improve ourselves. Sound simple? Yes, it is—but it isn’t easy.”

Okay, that’s it for today. I’ll be back tomorrow with more good stuff! (And because I’ve been negligent about posting this week, I’ll probably be back on the weekend for an update too.)

Why, hello!

As you may (or may not) have noticed, Jim and I took a brief holiday. But we’re back! And we come bearing fresh, juicy personal-finance stories from assorted corners of the web.

First up, it’s a profile of “the witch of Wall Street”, Hetty Green. (We could simply post this link today, and it would be enough.)

The fascinating (and forgotten) story of America’s first female tycoon. [Avenue] — “She eschewed living in grand style in a mansion on Fifth Avenue’s Millionaire’s Row (though she owned property there), and instead chose to lodge in inexpensive rooming houses across the river in Hoboken, New Jersey, or in Brooklyn, often under assumed names. Hetty famously made her rounds of New York banks using public transportation, and once stepped off a public coach lugging a parcel containing $200,000 in negotiable bonds.”

Self-directed, project-based learning. [Seth Godin] — “From the age of five, many kids are capable of self-directed, project-based learning if we’re willing to turn off the TV and accept that the process won’t immediately lead to sought-after standardized test results. We can create a pattern of teaching people to be curious because curiosity is an engine for learning…” [I found this especially interesting because I recently decided to learn Japanese…for no particular reason other than curiosity.]

What to do with “extra” money. [Surviving and Thriving] — “Some things you can’t control – for example, the pandemic taking your job or cutting your hours way back. Or maybe the fact that your adult offspring had to move back home because their jobs vanished/shrank. But while you can’t change certain things, you can change the way you react to them. Taking any ‘extra’ money and putting it toward a goal is one of the things you can change.”

Let’s end things today with a video (as we often do). Generally speaking, I hate vertical video. It’s awful. And, in fact, I hate the fact that the video I’m about to share with you is shot in vertical mode because that means we’re missing so much visual information we might otherwise have. But this one is so good that I’m willing to forgive its verticality.

Here’s a five-minute video of a man hand-crafting a teapot from scratch. I love it. (True story: We own a teapot that’s nearly identical to this. What if this man made our teapot?)

https://www.youtube.com/watch?v=6u54KNhpOTc

Okay, that’s all for today. I’ll be back tomorrow with more links and videos and fun.

I’ve never considered myself a strong organizer and this is especially true when it comes to digital information – files, images, etc.

But I recently stumbled onto this PARA method and I find it interesting, I hope you do too:

The PARA Method: A Universal System for Organizing Digital Information [Forte Labs] – “Imagine for a moment the perfect organizational system. One that supported and enhanced the work you do, telling you exactly where to put a piece of information, and exactly where to find it when you needed it.”

What is Your Biggest Financial Risk? [White Coat Investor] – “There are a lot of financial risks in your life. I frequently run into people who are worried about the wrong ones though. They seem to have little insight into what their biggest risks are. Our biggest financial risk frequently changes as we move throughout life and I think it is important to recognize and protect yourself against your biggest risks. Here are some of the financial risks that you might run at some point during your life:”

And to round out the week, here’s a fun little article for you to keep yourself entertained. 🙂

The Stowaway [Truly Adventurous on Medium] – “A global wave of high profile crimes has INTERPOL, Scotland Yard, and American detectives chasing a shadow. Can the best conman of his generation stay one step ahead of the unofficial global task force obsessed with taking him down?”

Have a great weekend!

I have always loved psychology and behavioral economics because it’s like a cheat sheet for human behavior.

While it may have helped me in life, business, etc – it’s helped the most in dealing with our kids. One of the key ideas I’ve tried to remember is that of overjustification (or more accurately, the overjustification effect). It’s the idea that if you pay someone to do something they already do for intrinsic rewards, the extrinsic reward replaces the intrinsic reward.

For example, if your kid enjoys reading, don’t start paying them to read more books. Eventually, the payment becomes the new reward and it replaces the intrinsic reward. I think that’s a bad outcome.

Like many things in psychology, it’s controversial because the line is not always so clear. We believe it happens more easily in children than with adults, for example, but is a child someone who is 10? 15? 20?

Either way, I wanted to share a new study that adds a wrinkle to the idea:

Do Monetary Incentives Undermine Performance on Intrinsically Enjoyable Tasks? A Field Test [MIT Press Journals] – “Economists have long been intrigued by an influential literature in psychology positing that monetary pay lowers performance on enjoyable tasks by crowding out agents’ intrinsic interest in them. But typical experiments in this literature do not report a full set of performance metrics, which might reveal conflicting evidence on crowding out. Further, they may suffer from confounds. To evaluate these issues, we review over 100 prior tests and run a field experiment building on the canonical two-session test for crowding out wherein agents receive pay for an interesting activity in session one that is withdrawn unexpectedly in session two. We test whether pay harms performance using a comprehensive set of performance measures, and if so, whether unmet pay expectations might also contribute to this decline. Our results on output, productivity and quits are most consistent with a standard economics model than with a crowding out one. Additional, though more speculative, evidence suggests that unmet pay expectations may harm output quality.”

If you want to continue with me on the behavioral highway, I recommend this video by Simon Sinek:

It talks about the role of EDSO – endorphins, dopamine, serotonin, oxytocin (and cortisol) – within the context of work. I think it applies to a lot of areas in our lives and it’s important to know why we do the things we do. (ie. why do you check Facebook or your email so often? that’s ole dopamine at work)

Finally, a fun little article about how the uber rich in Silicon Valley are enjoying the quarantine. 🙂

“All These Rich People Can’t Stop Themselves”: The Luxe Quarantine Lives of Silicon Valley’s Elite [Vanity Fair] – “Travis Kalanick is throwing (outdoor) parties, private-jet owners are hopping from safe zone to safe zone, and dinner party hosts are administering 15-minute COVID-19 rapid tests—all business as usual. “Coronavirus is a poor person’s virus,” says one source.” Yikes.

See you tomorrow!

Time is such a precious commodity. We don’t know how much time we have on this Earth but we do know it’s not unlimited.

And we fill it with activities of varying “value.” Sometimes we spend it doing the things we love with the people we love and time seems to stand still. Other times, we spend it doing the things we must so that we can pay for the things we love … and time seems to stand still, but for other reasons. 🙂

Experts estimated that, as a species, we have about a billion and a half heartbeats during our lives:

Size Matters: The Hidden Mathematics of Life [NPR] – “Though big and little creatures look very different, below the surface there is a surprising unity. Biologists have compared the heartbeats of mammals and discovered that on average (this won’t apply to any individual, just to groups) elephants and shrews and most of the critters in between have a limit of about a billion and a half heartbeats in a lifetime and then they die.” (emphasis mine)

Despite its title, this next post isn’t so much about wealth as it is about time management:

True Wealth is “never feeling rushed” [Rad Reads] – “If time is the currency of achievement, why are some able to cash in their allocation for more chips than others? And in a world of rapid fire Slack messages, daily episodes of The Daily and Zoom calls up the wazoo – who on earth has the right to not feel rushed?”

Accentuate the positive, eliminate the negative [Get Rich Slowly] – “When Kim and I go to bed each night, we spend time casually browsing Reddit on our iPads. It’s fun. Mostly. […] But here’s the thing. After browsing Reddit for thirty minutes or an hour, I’m left feeling unsatisfied. In fact, I’m often in a bad mood. After browsing Reddit, I have a negative attitude. My view of the world has deteriorated. Why? Because for all the fun and interesting things on Reddit, it’s also filled with a bunch of crap.”

Finally, here’s a post that will take you 21 minutes and suck you into the world of Masterclass:

How to Learn Everything: The MasterClass Diaries [Longreads] – “One day, when MasterClass sends its millionth paid ad into my Facebook feed, I decide this is the answer to the Walter Mitty lurking inside me. MasterClass seems to offer everything: from writing seminars with over a dozen famous authors to celebrity-driven inspiration to take my hobbies further. Clearly, all I was missing were the right teachers, filmed professionally and beamed into my living room. I may not become a surgeon or a pilot, but what if the renaissance woman I’d hoped to be is just a $200 subscription away?”

What will you cut or add to your day today?

I rely heavily on mental models as a way to coalesce my thinking around particular ideas.

The world is complex and models help me organize ideas and concepts into packages I can remember with relative ease. In many ways, they’re like games. Games are filled with rules, pieces, tactics and strategies – but we don’t remember how to play a game piece by piece, rule by rule. We remember our tactics and our strategy as it is refined over the times we’ve played.

We learn new games by relating them to old games… and life is one big game, just has more significant consequences. And they’re all based on putting complex situations into mental models that are easier to understand and use.

And today, I want to share a few resources that I find helpful whenever I build and renovate these mental models.

First, a refresher on mental models:

Mental Models: The Best Way to Make Intelligent Decisions (109 Models Explained) [Farnam Street] – “This guide explores everything you need to know about mental models. By the time you’re done, you’ll think better, make fewer mistakes, and get better results.”

The Five Pillars Of Wealth Building [Darius Foroux] – “Any type of pursuit in life consist of a few fundamental ideas and concepts. For example, theory and experiment have been the two pillars of science for centuries. Those fundamental concepts have solidified our understanding of the world.

It’s the same for wealth building. I’ve identified five pillars that support our understanding of how to responsibly build wealth. You’ll see these concepts everywhere personal wealth is created.”

This ties in nicely with the idea of mental models and this 30-minute video by Ray Dalio on the Principles of Success:

I like to watch that video once every few months as a good refresher.

And before you go, something fun — It’s been a while since we’ve gone to Trader Joe’s but we’re a fan of a lot of their products in our home. Some of the products on the list feel like filler (bananas? organic brown rice? c’mon…) but it has a few goodies on it.

The 50 Essential Trader Joe’s Foods [Thrillist] – “There’s a reason Trader Joe’s has become America’s favorite grocery store, and it has nothing to do with those Hawaiian shirts. The chain has come a long way since opening in Pasadena, California back in 1967, growing to an empire and drawing hordes of shoppers on the strength of its affordable, store-brand offerings, which rotate often and include everything from coffee and booze to healthy meals, unexpected snacks, incredible cheese, and internationally focused entrees that have helped evolve the American palate. It has legions of devoted fans. Even haters can’t help but find something to love within its aisles.”

Happy Monday!

Ah, it’s Friday. The end of another week. Time to ease into the weekend and enjoy what’s left of summer. Before we do, though, let’s take a look at some of cool stories about money (and related topics) that we’ve enjoyed recently.

This tiny house community feels like living in a small village. [Contemporist] — “Living in a tiny house community is the dream for some people, and Jesse Russell, owner and creator of Hiatus Homes, has designed a purpose-built village with 22 tiny homes, located in Bend, Oregon…The tiny house village has paths that connect the homes, with them arranged in a way that they face inward to the shared community spaces that include ponds, fire pits, planters, and a bocce court.” [Here’s a video tour. I want to live here!]

Nine symptoms of an unhealthy relationship with money. [Physician on Fire] — “The good news is, no matter how unhealthy your relationship with money is, you can always take steps to improve it. However, to make that happen, you need to identify the habits which are causing you to overspend or preventing you from spending even on your basic comforts and necessities.”

Okay, Boomers, let’s talk about socialism. [Hedgeye] — “Most Boomers think they earned it all on their own merits: See, capitalism works! Most Millennials suspect that it has more to do with how Boomers benefited from their particular age location in history.”

The problem with high expectations. [A Wealth of Common Sense] — “Even uber-successful people experience jealousy and make relative comparisons about career accomplishments. Getting exactly what you want in life can often be a letdown because it’s so difficult to be content with what you have. Once the positive feelings wear off, you eventually need a bigger hit of dopamine to get the same emotional response.”

Let’s end the week with something fun!

Here’s a segment from Penn and Teller’s Fool Us in which French performer Léa Kyle fools the hosts with her magical “quick change” act. As one commenter says: “If you slow it down to 0.25x, you can actually see that I have no idea how she does any of it.” Neither do Penn and Teller.

Here at Apex, we’re going to perform our own quick change act. Or maybe it’s a slow change act. I’ll be disappearing for a week while Jim steps in to take his turn with the links starting on Monday. Until then, have a great weekend!

Today, my friends, can you believe it? Today, my buddy Jim and I have gathered together some fine, fine stories about personal finance and related topics. What will we think of next?

How to make your high cost of living city more affordable. [CityFrugal] — “When you bump into something costly in a city, ask yourself why that is. Are you consuming what is plentiful and living in harmony with your city? Or are you trying to consume something that’s relatively scarce, pitting your desire against your city’s endowment of resources? Once you start seeing this distinction, you won’t be able to stop seeing it. I notice it everywhere.”

Is financial independence for everyone? [Millennial Revolution] — “In our situation, FIRE was life changing and I don’t regret quitting my job for a second. But are we the norm or the exception? Is it because you need a spouse in retirement to avoid loneliness? Or are some personalities simply not suited to early retirement?”

What you must do before you can design your ideal life. [The Fioneers] — “Over the last few years, I’ve sought out the resources to help me build a holistically fulfilling life. Each book, framework, experience, and resource taught me something that I’ve incorporated into my life.”

Make better decisions by freeing yourself from the need for perfection. [Educator FI] — “It is impossible to make perfect decisions. Trying to do so will ultimately cost you more in the long run. Instead, strive to make solid decisions…You’ll give yourself the chance to seize more opportunities. You’ll avoid staying in and taking catastrophic failures out of stubbornness.”

And to round things off: Have you seen the trailer for the upcoming Netflix film, Enola Holmes? Wow. This thing hits so many of my nerd buttons.

Everything about this looks charming.

That’s it for Thursday. I’ll be back tomorrow with one last batch of links before we head into the weekend.