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Curbing FOMO, Making a Million, & 25 Dumb Things You Do š«
Happy Tuesday, money tribe! A famous CEO used to start every Monday morning staff meeting by asking all his employeesā¦
Happy Tuesday, money tribe!
A famous CEO used to start every Monday morning staff meeting by asking all his employeesā¦
āHey everyone, what are the top 25 dumb things we do around here?ā
Then heād make a list of those dumb things and spend his week fixing them.
Pretty cool, right? Sometimes the most effective way to increase goodness ā> is to eliminate badness.
And this is also applicable in personal lives and financesā¦ What are the top 25 dumb things youāre doing with money right now? (Be honest)ā¦.
Can you fix some of those dumb things this week? šŖšŖšŖ
TO DO
Reinvest Your Dividends š
A common rookie mistake for investors is forgetting to set up automatic dividend reinvesting.
Many brokers make this a manual setting you need to check when setting up your account. Having your dividends reinvested means youāre taking full advantage of compounding within your account and your money is growing faster!
This week: Log into all your investment accounts and double check your dividends arenāt sitting on the sidelines. (Here is how to do it with Vanguard, Fidelity, and Schwab)
LIFESTYLE
Ways to Avoid Financial FOMO šŖ
Ever get that nagging feeling that everyone around you is making boatloads of money while you're stuck in the financial doldrumsā¦?
Well, youāre not alone ā everybody falls into the trap of feeling Financial FOMO in some way or another.
The good news is: there are ways to identify and address it before you take action based on those self-destructive feelingsā¦
First things first, let's talk about social mediaā¦ the breeding ground for FOMO. It's like a virtual circus where everyone is juggling stacks of cash and posting pictures of their luxurious vacations. But here's the secret: most of those people are more broke than you are! So, instead of scrolling through your feed and feeling inadequate, why not use social media to your advantage? Follow accounts that provide realistic, authentic, and positive content. Support the people who are showing & explaining the process, not just boasting about the end result.
Next up, let's address FOMO on investment opportunitiesā¦ Weāve all been there ā Your neighbor's cousin's best friend just made a 300% return investing in an NVIDIA covered calls scheme. Suddenly you're convinced that you should invest your life savings in some obscure cryptocurrency they are touting. Hold your horses! Instead of blindly following the herd, take a step back and do your research. Educate yourself about basic investment strategies and match the ones that suit your financial goals. Remember, it's better to miss out than to lose your shirt trying to keep up with the Winklevoss twins.
Now, let's talk about the pressure to keep up with the latest trends. We live in a world where new gadgets and shiny toys are constantly being thrown in our faces. But the truth is: those things usually donāt bring you true happiness or financial stability. The next time you feel the urge to splurge on the latest iPhone or designer handbag, take a deep breath and ask yourself if it's really worth it. Instead, focus on building an emergency fund or investing in experiences that will bring you long-lasting joy - and more freedom. Memories of an epic road trip will be way more valuable than any material upgrade.
Lastly, much of financial FOMO is the comparison game. It's easy to get caught up in comparing your financial situation to others, but remember, everyone's journey is different. Just because your friend is buying a house or starting a business doesn't mean you're falling behind. Embrace your own financial path and celebrate your achievements, no matter how small they may seem. Focus on the stuff you DO have, not the stuff you donāt.
Nobody is immune to Financial FOMO. Even peeps with a $10M net worth wish can envy the person down the street who has $100M in the bank. There is no end to wanting more, and the world we live in sparks those feelings constantly.
But remember, building true wealth is the ultimate goal. And that goes way beyond money and material stuff. You are doing way better than you think. šŖšŖšŖ
Related stuff:
š» HTM Blog: 6 Ways to Fend Off Financial FOMO
š§ HTM Ep #668: Financial Pessimism Will Eat You Alive
TOGETHER WITH CIT**
No Penalty. No Problem.
Want to lock in an awesome CD rate, but still have the ability to withdraw your funds at any time?
CIT Bank offers an 11 month, no-penalty CD. This means you can withdraw your money ā including any interest earned ā at any time without penalties or fees.
Some important terms apply, like you need $1,000 min to open an account, and if you do take funds out you need to withdrawal the entire amount... Itās a great option if you want the guaranteed rate of a CD with added flexibility!
Check out CIT Bank. Earn that interest. āļø
RETIREMENT
Who Wants to Literally Be a Millionaire? šāāļø
According to Northwestern Mutualās latest Planning and Progress Study for 2023, the average amount American *thinks* theyāll need $1.27 million to retire.
Sadly, this is a huge stretch for most people, given that the current average retirement savings is just $89,300ā¦. Hereās an overview by age groupššš
Data: NW Mutual Planning & progress Study 2023
Well, weāre all screwed!!!
Just kidding. Maybe itās my unwavering optimism, but I believe that anyone, at any age, can change their financial trajectory. Yes, itās hard work. But itās definitely worth it.
If youāre behind on your retirement goal, here are a few practical ways to boost your progressā¦
Calculate your personal retirement goal: Rather than use everyone elseās numbers (or make random guesses) use a retirement calculator and set your own goals. You may find you donāt even need a million dollars to retire. For older folks with SS kicking in soon, your savings number could be much lower.
Track your Net Worth: Itās one of the most important metrics to follow and constantly try to improve. Check out our mega-post on net worth, which covers how to calculate yours, why itās important, and ways to grow it over time.
Utilize tax-advantaged accounts: Deferring and paying less taxes means faster compounding. Learn about and take advantage of any/all programs available to you. Roth, 401k, HSA, etc.
Cut out silly expenses: The rule of 173 means that for every monthly expense you can slash, youāll have 173 times that amount in 10 yearsā time. For example, slashing $400 from your monthly spending means an extra $70k in a decade! (and over $200k in 20 years). What can you cut back on today to grow your bottom line in the future?
Build or create other income sources: Hustles, hobbies, consulting, renting out stuff, part-time jobsā¦ Any money you can earn during retirement (even if itās just $10k per year) reduces how much you need to withdraw from your nest egg and makes it last much longer. For younger folks, start planning and building income streams now. For older folks, can you keep working in a reduced capacity in a role you might enjoy more? It doesnāt have to be all or nothing.
Retiring with enough money on hand is actually more attainable than you think. Focus on the process. The results will happen if you put in the hard work.
Related stuff:
š§ HTM Ep#662: Who wants to literally be a millionaire?
š² NW Tracker App: Empower (fka Personal Capital) is the best free app to track your expenses and plot your net worth
ICYMI
News and Fun Findsā¦
Average Salary š§āš«
The average annual salary across the U.S. is just over $59,000... but there's a decent variance comparing state by state. Here are the breakdowns for average salary, via Forbes.
Positivity š”
How do you stay positive and optimistic amongst all the bad news and cynicism out there? Well, Joel L was a guest on the Best Interest podcast talking about this exact topic! Check out the episode here, with Joel Larsgaard, 5am Joel, and Jesse Cramer.
Housing š
According to CNBC, these 10 states are Americaās strongest housing markets, offering buyers the best bang for their buck. "To determine which states have the healthiest housing markets, we consider multiple factors including price appreciation, housing starts, foreclosure rates, and affordability."
Transit š
Tired of busy airports, delays, lost luggage, etc..? Maybe you should buy a long-distance Greyhound bus ticket. In our mind bus travel never went away, but itās apparently back -- with a vengeance!
Overstock š
The car market is softening. Dealerships have almost 2 million new cars sitting on their lots, leading to lower prices (especially on the EV side of things).
FRIENDS OF HTM
Having fun, on a budget!
Want to save more money and feel better about your spending?
Our buddies Jen and Jill run the Frugal Friends Podcast! They help peeps control their spending without all the guilt and shame of strict budgeting.
They also put one heck of a newsletter! The Friendletter is like a text from your best friend in your inbox, three times a week, keeping you on track with your money.
Check it out and sign up! And get ready to feel confident about your finances and afford more of the things money canāt buy š
Thatās it for now! Cheers to a productive day ahead, with lots of butt-kicking.
Best friends out š»