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Apex Money Posts

Status and the Illusion of Progress

Status and the Illusion of Progress [More to That] – “If a nation as a whole is getting wealthier but its citizens are getting angrier, is that progress? If global life expectancy is increasing but more people are suicidally depressed, is that progress? A rationalist will answer, “Interesting point, but take a look at this data instead!” Whereas someone that understands the limitations of reason will say, “Maybe we’re thinking of progress incorrectly in the first place.”” Good food for thought as we work our way into the weekend and reflect.

Pineapple street musings [Contessa Capital Advisors] – “The “social proximity effect” describes the tendency to make connections with people who are around us regularly (eg, in our social network). This often coincides with our propensity to copy the money behaviors of our friends and acquaintances (hence the well-known phrase “keeping up with the Jones’s”), and the “social comparison theory”, which involves comparing our socio-economic status, possessions, and lifestyle to the people we spend time with.” You are the average of the five people around you, right?

The Optimal Amount of Hassle [Morgan Housel on Collabfund] – “The thing people miss is that there are bad things that become bigger problems when you try to eliminate them. I think the most successful people recognize when a certain amount of acceptance beats purity.” It’s kind of the other side of the Region Beta Paradox, except you are aware of it and knowingly settle in the beta.

Enjoy the weekend!

Why Economic Uncertainty Doesn’t Matter

I very rarely follow much of the financial news these days beyond reading a few emails, just too many things to get worried about!

When you are investing for the long term, being aware of the big news stories is great but don’t let it impact your behavior. I learned during Covid that the news was negatively impacting me and made a conscious effort to reduce how much I was consuming. It definitely improved my mental health!

Why Economic Uncertainty Doesn’t Matter [Mile High Finance Guy] – “While recessions are terrifying to someone too caught up in the moment or with a limited understanding of the economic cycle, they are temporary. If you fail to realize that this downturn and uncertainty will pass and give way to a future with renewed prosperity, you will surely panic too!”

The Road Trip – What Almost Everyone Gets Wrong On the Journey to FI [Money Flamingo] – “Today I invite you to do a little thought experiment with me. It reveals what most people get wrong on the path to FI. It will also tell you a lot about your own journey to Financial Independence.” A good discussion of the pitfalls of focusing on the wrong things in your FI journey (tip of the cap to Womens Personal Finance for finding this one!).

How “saving” money leads to debt [Thursday Evening Money] – “One of my early finding when building christmas club was understanding how people use and translate the word “savings” when referring to money. I talked with a dozen people who live paycheck to paycheck and asked them, would you consider yourself a good saver? Almost all say yes. And then, I’d follow up asking, why do you consider yourself a good saver? And here’s some answers that I got.”

10 Harsh Money Lessons That You Never Learned in School.

Hey Plutus Family! Wednesday could not come fast enough. We are so excited to share this week’s content with you. Please enjoy!

Check out what we have for you this week.

13+ Beginner Investing Tips (for Success & Peace of Mind). [The Money Principle] — “Here, I’ll share the principles for successful investing and peace of mind that every beginner investor must know. These investing tips are not technical but specific enough to entice you to act.” (Submitted by Tarsha.)

The Road Trip – What Almost Everyone Gets Wrong on the Journey to FI. [Money Flamingo] — “If you want to solve the FI equation for enjoyment and success (that is about more than just numbers), you need to consider different “ingredients”. You also need to question some of the basic assumptions we make about Financial Independence.” (Submitted by J. Money.)

10 Harsh Money Lessons That You Never Learned in School. [Studenomics] — ” I’ve seen a variation of this message on social media over the years. Personal finance is one of those topics that we have to figure out on our own as we go through life, and it can be highly frustrating. This is why I wanted to look at what you likely weren’t taught about money as a high school or college student that you should know.” (Submitted by Tarsha.)

Defending the 1% AUM model for financial advisors

Last week, I asked a somewhat polarizing question on Twitter:

There were some good answers. A lot of them focused on how much 1% would cost over decades (a LOT) but a few brought up excellent points.

The two I wanted to highlight were from Chad and Rick Ferri:

The Rick Ferri tweet prompted a discussion that included a few financial advisors and I invite you dig into the money psychology behind those tweets and make your own decision.

The thread also surfaced this Whitepaper from Vanguard – Putting a value on your value: Quantifying Advisor’s Alpha. In “investing terms,” alpha is shorthand for value add. When you work with someone, like a financial advisor, what do they offer above and beyond what you can do? Oftentimes, we think of this as higher returns. But the paper offers up a framework to provide value in “relationship-oriented services,” rather than trying to beat the market. Interesting to see this coming from a firm known for low cost funds (but recently ventured into advisory services).

When your neighbors become your overlords [Vox] – “There are few things more delicious than a homeowners association horror story. All over the internet, you can find tales of people getting fined for parking their vehicles in their own driveways or having a potted tomato plant on their back porches or leaving a bottle of Gatorade out for one day. In Tennessee, a man returned from vacation to discover his car was missing; he thought it had been stolen, but in reality, his HOA had towed it because it had a flat tire. A Maryland HOA fined a homeowner $40,000 because the fence she built was 8 inches too long. A Missouri HOA threatened a family with jail time because they’d put up a play set that was — gasp! — purple.”

I’m glad we’re not in an HOA!

How to Leave a Career You Don’t Genuinely Love

When I look back on my “career arc,” I never could’ve predicted where it would take me.

I accepted my first job in 2003 because it was the only offer I had. It was to work for a defense contractor for a pretty good salary. The job was fine, not particularly inspiring, and what appealed the most was the fact that they hired a hundred-plus new graduates each year and a “leadership development program.” It turned out to be a great decision.

Looking back, a few of my friends still work at the company and have risen the ranks to become leaders in the company. It’s pretty awesome to see.

What’s less awesome to see is that they have a ton of travel, often being away from home for several days during the week, and it isn’t something I’d love to do. I’m not sure I’d be able to do it… but what’s the alternative? Sometimes that’s what the job calls for. Tough decisions to be made for sure, but our first article can help… maybe. 😅

How to Leave a Career You Don’t Genuinely Love [Retire Before Dad] – “Common advice from life coaches and career gurus is to build a career you love so much you don’t want to retire. I appreciate this advice and wish I’d followed it more in my 20s and early 30s. But genuinely loving what you do is a rare privilege. Most people don’t love their jobs, let alone their careers. Early on, we might like our jobs or tolerate them enough to use the income to qualify for a 30-year mortgage and get comfortable in a certain lifestyle. But then we’re trapped because we need the same income level or more to service the debt and maintain the way of life. Lifestyle inflation kicks in — income grows; spending follows. It’s gradual confinement.”

AI is taking the jobs of Kenyans who write essays for U.S. college students [Rest of World] – “For the past nine years, Collins, a 27-year-old freelance writer, has been making money by writing assignments for students in the U.S. — over 8,500 miles away from Nanyuki in central Kenya, where he lives. He is part of the “contract cheating” industry, known locally as simply “academic writing.” Collins writes college essays on topics including psychology, sociology, and economics. Occasionally, he is even granted direct access to college portals, allowing him to submit tests and assignments, participate in group discussions, and talk to professors using students’ identities. In 2022, he made between $900 and $1,200 a month from this work. Lately, however, his earnings have dropped to $500–$800 a month. Collins links this to the meteoric rise of ChatGPT and other generative artificial intelligence tools.”

IRS Pledges More Audits of Wealthy, Better Customer Service [U.S. News 7 World Report] – “The Inflation Reduction Act Strategic Operating Plan, released April 5, 2023, lays out the details of what to expect from the IRS. It plans to step up two major actions: audits of individuals and businesses with incomes of $400,000 and above, and new and improved customer service for all.”

How to spend money (and actually enjoy it).

Well, money nerds, we’ve reached the end of another week. Before you all wander off to your various enjoyments, I have one last batch of money links for you.

To kick things off today, I’ve got a podcast for you. I rarely link to podcasts (because I don’t generally listen to podcasts) but today is an exception because the show includes two of my favorite colleagues: Brandon from Mad Fientist and Ramit from I Will Teach You to Be Rich.

Here’s their conversation about how to spend money (and actually enjoy it):


A quote from Ramit:

The point of living a rich life is not to save money. It’s not. The point of a rich life, in my opinion, is to design a rich life that excites you and then use your money to live as meaningful of a life as you can. So I’m all for a high savings rate and aggressive investments and earning more. I’m totally for that. But there’s another side of the equation that too many people ignore and that’s what I’ve been very excited about.

Okay, here are the other stories I have for you today:

Being poor vs. feeling poor. [More to That] — “One interesting phenomenon that’s been occurring in the United States is that poverty has been decreasing while incomes amongst the wealthiest have been increasing. At first glance, this may seem like a win-win. If more people are escaping poverty and the wealthy are earning more, doesn’t that seem like a non-zero-sum game? Well, the answer is no, and there are two reasons for this.”

The secrets of stealth wealth. [Financial Imagineer writing at Physician on FIRE] — “Imagine if you’re filthy rich but don’t want anyone to know. That’s why some people lead seemingly ordinary lives while driving average cars and seem to be middle-class, while secretly being wealthy. This is called stealth wealth, and it might just be the wisest decision anyone can make with money and wealth.”

Should young people save less and spend more? [A Wealth of Common Sense] — “As your income increases you begin to spend more money and get used to your new lifestyle. You gain responsibilities as you age. Maybe you get used to some of the finer things in life. It can be extremely difficult to flip the switch and start saving once you get used to a certain level of spending. It’s also much easier to live a more frugal lifestyle when you’re young.”

And that’s all I’ve got. Jim will return next week with more. I’ll be back in ten days with another glimpse inside my bizarre brain. 😉

Inside the world of luxury water collectors. (Yes, I’m serious.)

It’s Thursday, my friends, and I’m J.D. Roth. Today, I have three excellent articles for you. Seriously, if I were to rate installments of Apex Money by total quality of the links curated, this would probably be in the top 5%. Each of these three pieces is interesting in one way or another. Don’t believe me? Go read them yourself…

What’s the point of a primary care doctor? [Mel Magazine] — “Against an apparent backdrop of decline in both patient demand and doctor enthusiasm for end-to-end treatment within primary practice, you might wonder why you’re still being shunted through their waiting rooms, when it’s a specialist you really want to see. You might also wonder, since you’re in a diagnosing frame of mind, where all this pressure for referrals and over-treatment is really coming from.”

How tiny, cheap smart speakers unlocked the rise of digital payments in India. [Rest of World] — “Abbas Ali, a vegetable vendor in an upscale neighborhood in New Delhi, started accepting digital payments in 2021. But every time a customer paid online, the 48-year-old, who can neither read nor write, would need to call his son to confirm that the payment had been received. The customers, often in a rush, would get impatient…Eventually, a fellow vendor suggested he subscribe to a ‘sound box’ — a nifty internet-connected device that reads out payment confirmation messages.” [Always interesting to get a glimpse at other cultures.]

We’ll conclude today with what might be my favorite article so far in 2023. It’s early in the year yet, but this piece is golden:

Inside the very real (and very complicated) world of luxury water collectors. [Bon Appétit] — “I remained skeptical. Water, to me, tastes like water. The only texture I can describe it having is ‘wet.’ How could someone justify spending hundreds on bottled water when entire communities, like those in East Palestine and Philadelphia, are affected by contaminated water supplies? What could compel someone to spend weeks at the Doemens Academy in suburban Germany sipping on different waters? What does it mean to elevate something like water, a fundamental human need and a growing scarcity in some places, to this level of luxury?”

I liked that article so much, in fact, that I did I found the author’s homepage so that I can read all of his other stuff. I am — no joke — tempted to send him fan mail.

Yes, I’m a nerd. But so are you, right? Otherwise you wouldn’t be reading this! 😀

Did Judas Iscariot Make the Worst Deal in History?

Good morning, Plutus Family! We are so happy to share these great articles with you on hump Wednesday.  Enjoy!

Check out what we have for you this week.

Did Judas Iscariot Make the Worst Deal in History? [Young Money] — “My man literally sold the Son of God for an Uber from JFK to Manhattan during rush hour traffic. So yeah, Judas’s deal was pretty bad. But at least he didn’t spend $300,000,000 on two Papa John’s pizzas.” (Submitted by J. Money.)

Digital Envelope Budgeting System: Why I Love It.  [Social Work to Wealth] — “Budgeting is the formal process of organizing your income and your expenses. With a budget, you are creating a spending plan for your money.” (Submitted by Tarsha.)

Saved by Compounding.  [Humble Dollar] — “If I made a list of all the dumb things investors do, I likely committed them all. I chased performance, sold stocks in a bear market, invested in things I didn’t understand—you get the picture. Yet, despite the numerous setbacks I suffered before I matured as an investor, I was able to retire comfortably. How was that possible?”​​ (Submitted by J. Money.)

Knowing when you have enough.

Good morning, Apexians, and welcome to another tasty edition of your favorite financial curation site. Let’s look at what we have for you today.

The Finnish secret of happiness: Knowing when you have enough. [The New York Times gift article] — “Finns derive satisfaction from leading sustainable lives and perceive financial success as being able to identify and meet basic needs, Arto O. Salonen, a professor at the University of Eastern Finland who has researched well-being in Finnish society, explained. ‘In other words,’ he wrote in an email, ‘when you know what is enough, you are happy.'”

Community colleges are reeling. [Associated Press] — “Community colleges are far cheaper than four-year schools. Published tuition and fees last year averaged $3,860, versus $39,400 at private and $10,940 at public four-year universities, with many states making community college free. Yet consumers are abandoning them in droves. The number of students at community colleges has fallen 37% since 2010, or by nearly 2.6 million.” I’m a huge fan of community colleges, so news like this makes me sad.

Lastly, here’s a collection of resources from the Consumer Financial Protection Bureau that are intended to help teach kids about money:

Meet the money monsters! [Consumer Financial Protection Bureau] — “The Money Monsters are a group of creatures who are new to our universe. That means they need to learn about many important things like school, friendship, and financial literacy…These Money Monster stories introduce you to ideas, habits, and activities that you’ll need as you grow up and start to manage your own money.” [More CPFB youth financial education tools.]

But wait! There’s more! Here’s a fun video that has absolutely nothing to do with money. In this ten-minute clip, a Scottish man tries snacks from the southern U.S.. Funny and fun.

My girlfriend and I live in Oregon, but we spent six months in Savannah, Georgia a few years ago. We miss certain things you can’t get here. Deep-fried peanuts, for instance. SO GOOD. Uncle Bud’s are my favorite, but I cannot justify paying that price from Amazon. Maybe I’ll just have to fly to Georgia to buy them for cheap at a gas station…

The age of average.

Hello, Apexians, and welcome to another wonderful week filled with the best money links two fellas can find. Jim and I are always scouring the web for the best stories in personal finances so that we can share them with you, our loyal readers. Let’s start today with a recent installment from one of my favorite newsletters, Douglas Tsoi’s “Money and Meaning”:

An outer solution never solves an inner problem. [Money and Meaning] — “Blaise Pascal believed that ‘all of humanity’s problems stem from man’s inability to sit quietly in a room alone’…We hate, more than anything, being bored. A University of Virginia study showed that almost 50% of college students would rather shock themselves with electricity than be silent and without distraction for 15 minutes. Crazy, right, but what do you do when you’re bored?”

A four-day workweek reduces stress without reducing productivity. [Scientific American] — “Working four days instead of five—with the same pay—leads to improved well-being among employees without damaging the company’s productivity. That’s the recently reported result of a four-day workweek test that ran for six months, from June to December 2022, and involved a total of 61 U.K. companies with a combined workforce of about 2,900 employees.”

A 15-minute “awe walk” can help kill stress and build happiness. [Inc. magazine] — “Awe is the feeling of smallness and wonder you experience when you stand before something vastly bigger than you. It’s what astronauts feel when they look down at Earth from space or the rest of us feel looking up at the countless stars in the night sky. A significant body of psychology research shows awe helps us feel less anxious, more connected, and generally happier.”

The age of average. [Alex Murrell] — “The interiors of our homes, coffee shops and restaurants all look the same. The buildings where we live and work all look the same. The cars we drive, their colours and their logos all look the same. The way we look and the way we dress all looks the same. Our movies, books and video games all look the same. And the brands we buy, their adverts, identities and taglines all look the same. But it doesn’t end there. In the age of average, homogeneity can be found in an almost indefinite number of domains.” Yes! This!

I’ve been complaining about the homogeneity of American culture for years. It’s boring. It’s why I’m drawn to cars and furniture and people with character. (I love my Mazda Miata in part because it looks like nothing else on the road. Same with my previous car, a Mini Cooper.) I think the rise of the internet is the primary driving force in the sameness of everything.

Okay, that’s it for today. I’ll be back tomorrow with more. See you then.