How I Invest (The Boring Edition)

“Your life should be interesting – your investments should be boring.” – David Bach, The Automatic Millionaire.

A reader asked the following:

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I have three types of accounts:

  1. Workplace 403(b)
  2. Roth IRA
  3. Taxable Brokerage

This is going to be boring; grab a cup of coffee.  Of course, here’s your classic disclaimer – I am not a professional.  What works for me may or may not work for you.  Please consult a professional for any financial decisions.

  1.  Workplace 403(b) – This is invested whenever TIAA invests my contributions and my employer’s match.  I am paid on the 15th and the last day of each month, but TIAA makes the decision when to invest (i.e., the same day, or later).  I contribute 8%, and my employer matches 5%.

    I have a limited number of funds to choose from.  I have an “aggressive” mix, but some of the choices are “harder” for the average investor to invest into (e.g., Vanguard Mid-Cap Index Fund Institutional, which has a $5 million minimum investment).  I don’t have $5 million, but I can invest into it due to my workplace agreement.  So, I am not going to talk much about what I am invested in at TIAA, for it may not be accessible to you.

  2. Roth IRA – I have a retirement target date fund, which invests in a mix of stocks and bonds.  As of 2017, the limit to contribute to a Roth IRA is $5500.  Every 15th and the last day of the month, I contribute 1/24th of the annual limit.  I believe in dollar cost averaging.
  3. Taxable Brokerage – I have four mutual funds, just four:
    • S&P 500 Mutual Fund – let’s call it “A.”  This gives me large-cap exposure.
    • Total Stock Market Mutual Fund – let’s call it “B.”  This gives me, again, large-cap exposure, along with mid-cap and small-cap.
    • Total International Stock Market Mutual Fund – let’s call it “C.”
    • Dividend Growth Mutual Fund – let’s call it “D.”

      I invest the same amount in each mutual fund twice a month (8 x same investment amount):

      5th Day of the Month – B
      10th Day of the Month – A & C
      15th Day of the Month – D
      20th Day of the Month – B
      25th Day of the Month – A & C
      End of the Month – D

      Now, if there’s any extra investing, it goes into the smallest (by dollar amount) mutual fund.  Once it surpasses another, the next month’s extra investing goes in to the (new) smallest investment.

And, dear readers, that’s how I invest.  It’s automatic (except for the extra investing), and it’s boring and quite predictable.  Yes, sometimes I invest when the market is high, when the market is low, and when the market is flat.  Yet, it gives me one less thing to think about.

Thoughts?  Comments?



I Got Nothing, Do You?

I’ve been busy with work, so I don’t have an exciting blog entry today.  Since I get a lot of (shy) visitors, I am giving you the opportunity to ask me any money-related question (in the comments).  I’ll pick the best ones and answer them in a future blog.

Oh, come on, you want to know something.

Getting Rich(er) Slowly – The Ebates Edition

If you shop online, you must, and I repeat, you must know Ebates.

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Once upon a time, I used to live in a major city when I was a graduate student.  For clothing, I loved two places – Macy’s and Filene’s Basement.  Fast forward to today, I don’t live in a city, and the closest Macy’s is less than desirable.   (And forget there being a Filene’s Basement!)  I went from shopping on a whole store floor of clothing to a small section with limited brands.

Here comes in internet shopping!  Now, I am not going to promote Macy’s in this blog post.  But, I am going to promote Ebates.  If you go through this site, you go to the website you want (and they have 100s of companies listed) and make your purchases (as normal).  Yet, Ebates pays you a percentage of your purchases (1% or higher).  For Macy’s, it’s normally 3%, but Ebates has special deal days that double the percentage (or more).  One time, Ebates was offering 15% (See below photo for my May 14th Macy’s purchase.).

Of course, you have to pay money to get money back; it’s not “free money.”  Think of Ebates more as discount that is applied after you make your purchase.

As you can see below, I have received back almost $700.  When Ebates pays you back (quarterly), you can get cash (either as a check or as a direct deposit) or as electronic gift cards (with bonus incentives).  I usually elect my Ebates money as Macy’s gift cards, and Ebates raises my amount by ~10%.

So, in short, I love Ebates.  Below is an example of my current (awaiting) cash back that I will receive in August.

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Have you used Ebates?  


Playing around with Retirement Calculators 02 – Dave Ramsey

So, a lot of people seem to be on the Dave Ramsey band wagon (especially with getting out of debt).  I listen to his podcasts, but, when I became aware of his existence, I was already on his Baby Step 6.  As a treat to you,  though, readers, I have decided to use his investment calculator.

I added my details.  To simplify things, I did not change the already added retirement date.  For, the goal of this blog is to become a millionaire before retiring.  I first started with my budgeted investing (not cash savings).  According to this result, I will be a millionaire, just with investments (again, not including cash savings, real estate, etc.) in ten years (the blue line).

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In a second scenario, I added what I have been averaging with budgeted and additional investments this year (including what I have projected for June).  Again, this is not counting the budgeted and extra cash savings and what my current home value is.  This gets me to an investment millionaire in eight years.

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What do you think of Dave Ramsey’s investment calculator?  Do you like it?  Do you hate it?  What are your thoughts?

Meal Planning with Links (Inspired in part by Sluggy)

Saturdays are grocery shopping days.  Here is what’s planned for dinner.

Saturday: (New recipe) Roasted cranberry coq au vin

Sunday: Haddock en papillote and steamed broccoli

Monday: Chicken parmesan with salad with a lemon vinaigrette

Tuesday: Spring green risotto

Wednesday: Spiced-rubbed pork tenderloin, whole wheat rice, and roasted broccoli

Thursday: Leftover risotto

Friday: Homemade pizza (TBD)

What’s your meal plan?