Apex Money Posts

I’m 42 and for as long as I’ve been an adult, inflation has never been a concern.

I know that it was a bigger deal in the years I was born (it was 13.5% in 1980) but it’s always been around 3% or less for as long as I’ve been old enough for it to be a consideration in my life. As we exit the pandemic and inflation is much higher than what we’re used to, I think it’s valuable to think about how it impacts our life.

Have We Been Thinking about Inflation All Wrong? [The Walrus] – “For decades, governments have done all they can to keep inflation down. But maybe letting things run hotter is exactly what we need”

Why Inflation Rates Are Scaring the Hell Out of Me (and How You Can Beat Them) [Super Saving Tips] – “There are some things you can do about this mess and they are things I have touted for years and years before. If you ignored them before, it may be time now to take these actions. Let me go down my list.”

How a NYE Windfall Made Our Biggest Money Mistake of 2021 [TicTocLife] – “Our biggest financial mistake of the year didn’t arrive until late December but once the dust settles, it’ll likely have cost us some $15K+! Avoid our failure!” Calling this a “mistake” is a bit unfair to themselves but it’s still important to know that mutual funds will behave in ways that are predictable as long as you know what they’re trying to do. Stinks that they had deal with it though and it will have cost them money. 🙁

I love these Tiny Desk concerts, I think J.D. turned me onto them when Taylor Swift did an amazing one many years ago.

Here’s Alicia Keys: NPR Music Tiny Desk Concert:

Oh, Happy Valentine’s Day! 🙂

Well, we’ve made it to another Friday, money nerds. But before you sally off into the sunset for some much-needed relaxation, I’ve gathered one last batch of money stories to share with you this week. Here you go…

What I learned from starting a vending-machine business. [Action Economics] — “This vending machine business is in line with my long term goals. I want to take massive imperfect action to move my life forward and I want to create opportunities for my children to build wealth and learn finance at a young age to give them a massive head start when they enter adulthood.”

The secret superpower of the mini-retirement. [Josh Overmyer] — “These steps allow the mini-retiree with low or no income to make massive changes to the amount of future taxes owed, all because they have planned ahead a little bit. This is not ‘cheating’ the tax code – it is making smart decisions and paying only the taxes due and not a dollar more.”

How thinking about ‘future you’ can build a happier life. [BBC Worklife] — “In one experiment, the participants were presented with various scenarios in which they could either receive a smaller reward soon or a larger reward later. As expected, participants who felt a greater connection to the future were much more willing to delay their gratification and wait for the bigger sum.”

Should you die with zero? [RadReads] — “Meet Bill Perkins and his provocative book Die With Zero. The concept is deceptively simple. If you die with > 0 in your bank account, you failed at fully optimizing your life.There’s a lot here to unpack. A lot of nuance. And a lot of things we don’t like openly discussing.”

To close out the week, here’s a cynical little four-minute cartoon from Steve Cutts. It’s called “Happiness”. It’s a comical (yet sad) look at the rat trap that is the modern pursuit of happiness.

With that, let’s head into the weekend. Have a good one, my friends!

Hey hey. Not a lot of time for witty conversation in today’s installment of Apex Money. So, let’s just jump into the meat of these recent money articles I’ve found worthwhile…

How to save money on pets. [Bitches Get Riches] — “A lot of this advice will be about preventative measures: taking care of your pet’s health to avoid expensive vet bills or getting serious about training to avoid replacing expensive items like furniture and shoes. You can save money on pets by acknowledging that they are weird little creatures who don’t understand our strange and human ways, and that it is our responsibility to teach them and be understanding of what gets lost in translation.”

Investing during high inflation. [Millennial Revolution] — “When we sat down to do our 2022 portfolio review and decided on changing our asset allocation at the end of December, the primary reason for increasing our equity allocation to 90% was, again, because the math told us that the dividends were enough to more than cover our living expenses. The second reason was because we knew that inflation would stick around for a while and equities provide a good inflation hedge.”

An introduction to dollar-cost averaging strategies. [Quantpedia] — “Imagine you won a significant amount of money and you want to invest it in a particular investment. You can either invest it all at once or spread it into multiple smaller investments over time. If you chose to spread the investments, you picked a strategy called dollar-cost averaging. When an investor applies dollar-cost averaging (DCA), they invest the money in equal portions at periodic intervals, regardless of the market conditions. This way, they eliminate the emotions that come with rising and falling markets.”

What we lose when work gets too casual. [The New York Times, so possible paywall] — “The loss of workplace formalities like fixed start and stop times, managerial hierarchies with clear pathways for advancement and professional norms that create boundaries between personal and professionally acceptable behavior only hurt workers. Though the pandemic-era transformation of white-collar work seems empowering at first, we should not be deceived: Many of these changes mostly benefit employers.”

I’ll be back tomorrow with one final installment to carry us into the weekend. Join me, won’t you?

Welcome to Wednesday, money nerds, and welcome to another edition of Apex Money.

A few weeks ago, I shared a video about how airlines quietly became banks. Well, I recently discovered an old article (from August 2019) about how Starbucks has done something similar.

Starbucks, financial superpower. [Moneyness] — “Stored value card liabilities are the money that you, oh loyal Starbucks customer, use to buy coffee. What you might not realize is that these balances simultaneously function as a loan to Starbucks. Starbucks doesn’t pay any interest on balances held in the Starbucks app or gift cards. You, the loyal customer, are providing the company with free debt.”

Translation: Starbucks customers have purchased more than $1.6 billion in gift cards. This amount is, effectively, an interest-free loan to the company shared by many millions of people. The company is free to use this free cash to generate greater returns by investing it. Crazy!

“Should I be worried if I get a letter from the I.R.S.?” [The Military Wallet] — “Most IRS letters are not a crisis. If action is needed, you typically have time to deal with the issue. The IRS does try to work with taxpayers to find reasonable solutions.”

How to cure yourself of investing FOMO. [Wallet Hacks] — “FOMO, whether investing or otherwise, relies on a cognitive bias known as scarcity. We assume that when things are scarce, they are more valuable (gold has value strictly because it’s scarce!). We may, and often do, make bad decisions when influenced by this scarcity bias.”

Today’s video features is all about science! Here’s a 17-minute YouTube clip from the Veritasium channel that looks at the longest-running evolution experiment in the world. For 33 years, researchers at Michigan State University have been evolving E. coli bacteria at a rate of six or seven generations per day. They’ve now had the equivalent of nearly two million years of human lifespan. How have they changed?

I love this stuff. It makes me feel small, but it makes the universe seem even more wondrous. Yay! (More about this experiment here.)

Okay, that’s all for today. I’ll be back tomorrow with more interesting links for your edification. See you then…

Good morning, Apexians, and welcome to Tuesday. This morning, if all goes well, I’ll be baking bread. I started my “no knead” dough yesterday afternoon (which is really just a few minutes ago in Real Time, but that’s kind of confusing, no?), which means it ought to be ready for a quick fold and second rise at about the time this edition goes live.

But you know what? I’ve been working on my “no knead” bread recipe for a couple of months now. (I use both Bittman’s recipe and the Cook’s Illustrated modified version.) And despite having baked dozens of loaves, I always struggle with the brief “not kneading” period of kneading before the final two-hour proof. It just never seems to work like it’s supposed to. Never. Not once. I’m not sure what I’m doing wrong…

But you’re not here to talk about baking, are you? You’re here for excellent articles about money (and other related topics). Let’s get to them!

Will your spending decline in retirement? [Monevator] — “As it happens, there’s a large stack of research that suggests people really do see their spending decline in retirement. At least on average. And if this turns out to be you, then the amount you need to retire should be less daunting than previously advertised.”

The high cost of an easy job. [Of Dollars and Data] — “The easy choices come with hard consequences…later. They show up where you might not expect them. With regret. With nostalgia. With sadness. The easy way out always has hidden costs. The question is: are you willing to pay them?”

A generation of American men have given up on college. [The Wall Street Journal] — “Men dominate top positions in industry, finance, politics and entertainment. They also hold a majority of tenured faculty positions and run most U.S. college campuses. Yet female college students are running laps around their male counterparts.” [This article is fascinating, as is the trend it explores.]

And that’s all I have for this Tuesday. Time for me to go put my first loaf of bread in the oven. I’ll be back tomorrow, though, to share more news about personal finance…

Welcome to February, my money nerds, and welcome to another week of Apex Money. To kick things off, I have an interesting little essay that does a good job of capturing much of my personal world view.

Dreams and kindness are all we have. [Interfluidity] — “Unmediated, outside of the temptations of commerce, the humans are mostly remarkably good to one another. It’s people being awful that goes viral on the apps, but those videos are absurdly unrepresentative. When our imaginations and conversations are dominated by salacious, mediated events, we become tempted to override our own gentleness, to prosecute cruelties in the service of an imagined cause with little connection to actual humans here and now.”

For fifteen months in 2015 and 2016, Kim and I traveled across the U.S. in an RV. We met all sorts of people form all sorts of backgrounds with all sorts of beliefs. During those fifteen months, we had encountered two rotten apples. Of the thousands of others we dealt with, everyone was pleasant and kind. But you’d never know that if you believed what you saw on the news…or on Reddit.

And here’s the rest of today’s news…

How we’re establishing a family money philosophy with our children. [Frugalwoods] — “Our oldest child, six-year-old Kidwoods, started asking about money this fall and her curiosity reached an inflection point earlier this week thanks to a school book sale flier advertising a $7 unicorn book. So here’s my non-expert, imperfect tale of how we’re teaching money management to our children. Well, really just to Kidwoods since Littlewoods (age almost four) remains unimpressed and uninterested.” [This is an excellent, thoughtful article.]

Everything must be paid for twice. [Raptitude] — “You can pick up Moby-Dick for a dollar at a garage sale, but it’s a wasted dollar if you don’t subsequently pay a significant second price: sixteen hours of attending closely to long Victorian commentaries on whales and the men who hunt them. And you’ve got many more debts competing for those same sixteen hours.”

The small steps of giant leaps.[Farnam Street] — “When you look below the surface, giant leaps aren’t really giant leaps at all. They’re a series of ordinary choices that suddenly become noticeable. If you look for the magic moment, you’ll miss how ordinary becomes extraordinary.”

To wrap things up today, here’s an hilarious two-minute video I found on Twitter. It’s a commentator (from St. Louis, I think) laying out how bleak February is.

Give this man a Pulitzer pic.twitter.com/jRdHP3hTJI via @ShawnHils

— Taylor Lorenz— ON BOOK LEAVE (@TaylorLorenz) February 4, 2022

Honestly, it’s not February that’s bleak in Oregon’s Willamette Valley. It’s January. And we’re past that. February actually brings signs of hope. In fact, right around this time of the month is when we get our first warm, sunny days of the year. Temps climb to 15 or 16 or 17 (the low 60s, if you’re still a Fahrenheit user), and we Oregonians don shorts for a couple of days.

Then things turn wintry again haha.

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

You made it to Friday! Give yourself a pat on the back, enjoy these posts, and we’ll see you next week!

Space Budgets: A Simple Tool for Minimalist Living [Andrea Dekker on Becoming Minimalist] – “The concept is similar to setting a timer to limit the time we spend on a specific task. Or creating a budget to assure we don’t spend more money than we have. With a space budget, the goal is to use the space we have… and remove everything that doesn’t fit within that space.” I love this reframing of the clutter problem.”

Millennial mom whose passive income side hustle brings in $12,500/month: My goal was ‘to quit a full-time job and work for myself’ [Acorns] – “So when she went on maternity leave again in 2020, Jones decided to focus her efforts on building out the store and learning how to make it more successful. Today, her shop, the name of which she prefers to keep secret lest copycats replicate some of her more niche products, features more than 200 printable items and grosses an average of $12,500 per month in passive income.” Normally these types of posts are ridiculous in that they have a terrible premise – like someone paying off $50,000 in student loans in 4 months because they got a $3 million inheritance. But this one is legit.

How We Broke the Supply Chain [The American Prospect] – “Almost none of these stories will explain how these shortages and price hikes were also brought to life through bad public policy coupled with decades of corporate greed. We spent a half-century allowing business executives and financiers to take control of our supply chains, enabled by leaders in both parties. They all hailed the transformation, cheering the advances of globalization, the efficient network that would free us from want. Motivated by greed and dismissive of the public interest, they didn’t mention that their invention was supremely ill-equipped to handle inevitable supply bottlenecks. And the pandemic exposed this hidden risk, like a domino bringing down a system primed to topple.”

Lessons from the crab Shack (Where the Elite Eat in Their Bare Feet) [The Escape Artist] – “To me, The Crab Shack represented an ideal: it was high quality but didn’t take itself too seriously. It was independent, quirky, honest and unstuffy. To me, The Crab Shack represented The American Dream. To my way of thinking, anyone should be able to eat at The Crab Shack. It is a hallmark of fairness and meritocracy that anyone can rise up and join The Elite. Entry to The Elite should be open to everyone.” Seems like a fun place to go! (good lessons in the post too)

J.D. doesn’t like to share posts that he writes so I’m going to share this one because I loved it! 🙂

A lesson in speaking up for yourself: I saved $575 for a moment of discomfort [Get Rich Slowly] – “Like all humans, I have flaws. One of mine is that I hate confrontation. It’s a family thing. I’m not sure why, but none of us like conflict. Sure, this trait has some upsides. My brothers and I don’t get into a lot of arguments and fights with our family and friends. And when we do have conflict, we do our best to resolve things quickly.” I don’t like confrontation either and I also don’t like unscrupulous business owners, I’m glad J.D.’s issue was resolved quickly and he had the awareness to stand up for himself!

This happens in a lot of situations and people sometimes rely on the fact that people often dislike confrontation – it’s bad business but it works sometimes, which is why people do it!

Looking At Our Daycare Costs (And Why We Send Our Son To Daycare) [Financial Panther] – “At the end of each year, my son’s daycare sends us a PDF that details how much tuition we paid. It’s a helpful bit of information to have. My family is fortunate to be in a position where we don’t have to budget to meet our financial goals, so we’re always admittedly unclear about how much we’ve spent in any given category each year. Outside of our mortgage, taxes, and other fixed costs, I often don’t know what we actually spent on things.” We’ve sent all of our kids to daycare too and while it’s extremely expensive, it’s worth every penny! (seeing the PDF at the end of the year for tax purposes is certainly eye opening though!)

Hidden Dangers of Buy Now, Pay Later Apps [Frugal Rules] – “If you’re like many people, you may not always have adequate funds to make a purchase. This could cause you to either use a credit card and risk ensuing debt or delay the purchase until you have the necessary cash. However, a financial tool with growing popularity eliminates that problem. Buy now, pay later (BNPL) apps allow consumers to buy something online even if they don’t have the cash they need. Our guide shares why you might want to avoid using this resource and how it can wreck your finances.”

The answer might seem obvious to you (yes?) but it’s not always so clear. I know a lot of folks who retire and find themselves listless and not knowing what to do next.

But there are others who have a laundry list of things they’ve always wanted to do and are thrilled they now have the time to pursue them!

So the answer is quite personal, but still worth seeing how others are navigating it.

The blogger behind Accidentally Retired has been tracking his happiness for about three years with his Happiness Tracker Spreadsheet, and armed with that data he takes a look at whether this retirement impacted his happiness.

Happiness Revisited: did early retirement have an impact? [Accidentally Retired] – “If there is one large lesson I have learned in the last year, it is that though my happiness has continued to improve, I still have to choose to do the things to make me happy. FIRE affords you the freedom to stack great days together, but you don’t have to be retired to get the benefits of focusing on happiness one day at a time:”

The lesson here is that if you’re interested, get the free tracker sheet and give it a shot.

This next post might be a little too “Inside Baseball” since it’s about a massive wealth management firm buying a robo-advisor, but I thought it was interesting to see how the pros view the actions of even bigger businesses:

Why Is UBS Buying a Robo for $1.4B? [ThinkAdvisor] – “Welsh saw it as ironic that Wealthfront had set out to “disrupt advisors and traditional wealth management via technology” but has now “sold the business to a 160-year-old bank and wirehouse — just the people they claimed were evil and had targeted to disrupt.”” I don’t know enough about the industry to even guess but I was surprised, much like some of the experts quoted in this piece.

I found this next video super fascinating – Wendover Productions explains How Long Haul Trucking Works:

Or, Happy Lunar New Year!

Before the pandemic, we would host a Chinese New Year party each year. Friends would come over, we’d eat and drink in celebration, and it was a grand ole time. Since the pandemic, we haven’t done anything on that scale to mark the new year. This year, we won’t be having a party but we’ll be making a little special feast for our family.

It’ll give us a sense that life is getting back to normal as the Omicron surge, at least in Maryland, begins to subside.

Side hustles and second jobs – are they even worth it? [Budgets Are $exy] – “I was recently discussing side hustles with a friend, who was considering starting a small business alongside her day job. This topic has been discussed over and over within the FI world, and with good reason: side hustles are both interesting and a chance to make some extra moolah! But I’ve always had a love/hate relationship with the idea of side hustles.”

The Bill That Congress Might Be Embarrassed Enough to Pass [The Atlantic] – “The Justice Department investigated several senators for their 2020 stock dumps but filed no charges. The allegations of pandemic profiteering did, however, have major political repercussions and helped Democrats win their narrow Senate majority last year. Among those who found their transactions under federal scrutiny were both Republican senators from Georgia, David Perdue and Kelly Loeffler (they both denied any wrongdoing), who lost in special elections last January. The Democrat who defeated Perdue, Senator Jon Ossoff, is now leading a new push to ban members from trading individual stocks altogether.”

Resilience Is A Choice You Make [Mile High Finance Guy] – “So, whether pain or misfortune, recognize that this is unfortunate, but it is not permanent – after all, nothing is. Embrace and explore what it means to suffer, as when the flourishing comes, you only will be left with gratitude.”

Holy smokes! Check out Jonathan, a 190 year old giant tortoise!

And Happy New Year!