You are here: Home / Archives for Investing

Use Financial Roadblocks to Force Good Behavior

June 4, 2012 By

financial road blockWe all know what we’re “supposed” to do. We’re supposed to spend within our means. We’re supposed to save for the future. We’re supposed to be responsible and plan ahead. The reality is that personal finance is more about psychology than it is about simple numbers. Everyone knows that if you swipe the plastic more and fail to pay, you’ll get dinged with fees and interest. It’s like losing weight, you know that if you eat that Snickers bar, wash it down with a milkshake, and then take a nap… you’re going to gain weight.

When it comes to doing the right thing financially, it’s sometimes better to trick yourself into being good rather then relying on your willpower. Put roadblocks in the way of your bad behavior in order to force good behavior. That’s part of the logic behind the following ideas that you should implement to help improve your finances.

Freeze Those Credit Cards

One of the classic ways to stop yourself from using your credit cards is to not bring them with you in the first place. If you don’t have the cash on hand to buy something, you don’t buy it. If your credit card isn’t with you, you can’t swipe it. Some people take this advice one step further and they freeze their credit cards in a block of ice! You literally drop the card into a cup and then stick it in the freezer. If you want to use it, you have to defrost the ice. It gives new meaning to the term “cooling off” period.

Lock Up Your Cash

Now that you’ve frozen your credit cards, the next step is to tie up your non-emergency fund cash in a way that’s responsible. I recommend you consider putting it into a certificate of deposit or, at the very least, into a high yield savings account from an online bank. Regardless of what you do, your money won’t be instantaneously available with the swipe of a debit card, which puts enough of a roadblock to stop you from making at least some of your purchases. It’s like forcing you to go to the grocery store to buy a bag of chips, rather than walk into another room. You could easily hop into your car, but it’s not as easy as before.

Don’t Save Credit Information Online

There’s a reason why Amazon.com and other online retailers love it when you save your credit card information - it makes it easier for you to spend money. Between subscriptions and one-click buying, Amazon has perfected the art of getting customers to spend as much and as often as possible. Counter this strategy by never saving your credit card information online. When you are forced to enter your card details each time you buy something, you create a small hurdle to buying. You no longer mindlessly click “Add to Cart” and “Check Out.” You have to get your card, which could be in another room, and that’s often enough.

Don’t Carry A Lot of Cash

Last but not least, don’t carry a lot of cash because it has a funny way of sneaking out of your pocket. Take just enough so that you can cover any purchases you expect to make but not enough that you can make surprise purchases that bust your budget.

These are just a few small roadblocks you can set for yourself in order to keep your spending in check.

(This has been a post contributed by Jim over at Bargaineering.com)

photo by ollesvensson

Filed Under: General Finance, Investing

The Short and Sweet Guide to Compounding Interest

May 9, 2012 By

compound interestWho wants to work forever? No, I didn’t ask who wants to live forever, but who wants to work forever. When I got out of high school I said there’s no way I’m going to work till I’m old. Then I started working and wondered how I was ever going to get to stop working if they didn’t pay me enough to save for it. And there’s the kicker. You may not get paid enough, but you can most definitely saveâ¦..at least some or hopefully more.

But should you invest in a Roth IRA, Traditional IRA, 401k, 529 plans or maybe become a day trader? Good question, but one thing all of these have in common is they work off the principal of compounding interest. So before you learn about those investment options you must first learn and understand how compounding interest works. And by learning this you will want to seize the day and be on your way towards financial freedom.

Consider this:

If you started today, putting aside $100 every month and it compounded annually at a 7% rate of return (this is conservative), after 30 years you’d have $121,287. Or you could lock that up in a box under your floors and in the same amount of time it’ll total up to a whopping amount of only $36000. See the difference? (If you want to put in your own values, Google compounding interest calculator and try it out.)

Still not sure how compounding interest works? Don’t worry, I didn’t get it the first time I heard about it.

This example helped me wrap my brain around it.

First year: $1200 ($100 month) x 7% = $84 in interest

Second year: $1284 (1st yr) + $1200 (2nd yr) x 7% = $173.88

At the end of the second year you’ll have $2657.88 total when you only put in $2400. Follow this for 30 years and you’ll have $121,287â¦..don’t save early and in 30 years compounding interest will no longer be an option. This is a simplified example. In reality there are other options like monthly, quarterly, bi-annually compounding that you’ll need to consider. But the goal is to understand compounding interest and make it work for you.

Want to know how long it’ll take for your investment to double? It’s called the rule of 72. All you have to do is divide the rate of return (aka interest rate) into 72. The result is an estimate of how long it’ll take to double your value. For example 72 divided by 8% (interest rate) equals 9 years to double whatever amount you started with.

So what’s the deal? Why does it sound so simple yet all I hear is how everyone at retirement age hasn’t saved enough for retirement. Is the problem compounding interest or that people aren’t saving enough? Well, it’s a bit of both. The biggest catch to compounding interest is that the younger you start the more years your interest compounds and the more you have saved in the end. So you really do want to start now.

According to standardandpoors.com, from January 1970 to December 2009 (30 years), the average annual compounded rate of return for the S&P 500, including reinvestment of dividends, was approximately 10.1%. The S&P 500 is a good example because it is an INDEX fund that’s comprised of the top 500 leading companies in leading industries of the US Economy.

Here’s a little fun fact:

Warren Buffett, the founder of Berkshire Hathaway, started with only $9800 in 1955 and today is worth $44 billion.

In the April issue of ForbesLife magazine he said, The thing is, when I got out of college, I had $9,800, but by the end of 1955, I was up to $127,000. I thought, I’ll go back to Omaha, take some college classes, and read a lot-I was going to retire! I figured we could live on $12,000 a year, and off my $127,000 asset base, I could easily make that. I told my wife, Compound interest guarantees I’m going to get rich.â

(This post has been contributed by John over at Fearless Men)

photo by artbystevejohnson

Filed Under: Investing

When Should you go for a Reverse Mortgage?

May 1, 2012 By

I’ve been reading up on reverse mortgages lately because I think it could be a good financial tool for my parents to pay their bills and add to the income that they are living on in their retirement years. I’ve found that it is actually a helpful program that even I may choose to use one day as a part of my retirement planning. Because I wanted to understand more about how reverse mortgages work, I looked up answers to some of the most commonly asked questions about them. Here’s what I found.

What is a reverse mortgage?

When you purchased your home, you made an agreement with your lender concerning your mortgage rate. You also agreed to make monthly payments toward the value of that home, plus interest. A reverse mortgage is just the opposite; your lender will give you money each month, borrowing from the equity that you have put into that home. Repayment of the loan isn’t due until you pass away or are no longer living in the home.

Who qualifies for a reverse mortgage?

If you are a U.S. citizen of 62 years of age and own your own home, you qualify. Your eligibility for a reverse mortgage (and how much equity you can use from that mortgage) is usually determined by the value of your home, how much of that value you have paid thus far, and the ages of all people who own the home, including your spouse and/or children if you have any. I’ve also learned that to find the best mortgage rates for your reverse mortgage, you should compare lenders, just like you did to find your traditional mortgage.

Who shouldn’t get a reverse mortgage?

If you don’t plan to live in your home for much longer, then the reverse mortgage is not for you. This is because the repayment of the loan is due once you no longer use the home as your primary residence and because getting a reverse mortgage does entail paying an origination fee (and possibly other charges). Also, a reverse mortgage is not designed to use to cover a one-time expense, such as traveling or other recreational activities; rather, it should a part of a well-conceived financial plan.

Are there fees?

Yes, reverse mortgages do include fees, primarily the origination fee. You may also be charged a mortgage insurance premium. Your loan accrues interest over time, which means that each month you will be charged interest on not just the principle but also any interest that you incurred on the principle amount previously. Lastly, you are still responsible for the property taxes for your home.

How are payments distributed?

You can choose how you receive payments from your reverse mortgage. If you are using it to pay monthly bills, you can get regular payments each month much like the payments you made on your original mortgage. These payments can be made for a fixed amount of time or until you no longer occupy the home. However, if you would just like the financial security of knowing that you can tap into your home equity, you can opt to use your reverse mortgage like a line of credit, only withdrawing from it when you need to. You can also choose a combination of these two payment methods, which would enable you to receive a monthly payment and also have the ability to tap into your line of credit.

photo by nikcname

Filed Under: Credit, Debt, Investing, real estate

Do Your Kids a Favor and Open a 529 Plan

April 30, 2012 By

529 college savings planHave you heard of 529 college savings plans? If you’re a parent then you need to read this article. A 529 plan could be one of the decisions your kids will actually thank you for in the future. With skyrocketing tuition costs, it’s getting harder and harder to pay for college at the time of college.

Very few people know this but the government offers a special savings account called as 529 college savings plan. They are typically offered through your state and vary when it comes to investing options and benefit.

The 529 plan is modeled after a Roth-IRA account in the sense that the money you invest into a 529 plan is post-tax money and grow tax free for the remainder of its life. This means that all the money you place into a 529 plan can grow with the market and you will never pay taxes on those gains. How cool is that?

The only real difference is that a 529 plan has to be used strictly for college related expenses. So, you can’t pull the money out ten years from now and buy yourself a brand new BMW. The government already allows that with a Roth-IRA account, they’re not about to offer a second account!

Benefits of a 529 plan

-Your investments grow tax free and never see Uncle Sam ever again!

-A wide array of investment choices offered through your state.

-Typically, 529 plans offer low management fees.

-Anyone can contribute money to a 529 account.

-Funds can be used at any college across the United States and abroad.

-Easy access through your state’s 529 website.

-High maximum contribution limits (this varies by state).

A benefit for your kids

Now, this article is not promoting for paying for your child’s tuition! In fact, I encourage all parents to have their kids still pay their way through school. My parents made me do it and I’m grateful they did, I learned a ton and gained valuable money management skills. I even graduated college with zero debt!

What I AM saying is that as a parent, you have the ability to use tax free growth to use for future college expenses. You can still have your kids pay you for college tuition; it will just be replacing the 529 funds. You can even lock in tuition rates with pre-paid tuition plans so if your kids do pay you back for tuition, they are paying the price you locked in years in advance.

Opening a 529 plan is truly a win-win decision. You can’t go wrong with investing your money in this type of tax free growth account.

I plan on opening a 529 plan for all of my future children and ensuring they pay the least amount possible for tuition! Although they will be paying their way through school, I can do my due diligence and get them the lowest tuition rates possible while watching my money grow tax free until I pull it out.

So, are you sold? Comment below if you have questions or have a 529 plan and enjoy seeing the money grow tax free!

photo by inalaf

Filed Under: Family Finances, Investing

How to Buy on Craigslist and Score Great Deals

April 27, 2012 By

Craigslist is the mecca for buying used items from your neighbors for a fraction of the cost you would pay at a retail store. Craigslist isn’t just filled with junk, as some may have you believe, high-end items can be found from top of the line Bugaboo strollers to Pottery Barn furniture, used cars sold by owner, and gardening supplies.

Craigslist is like an online garage sale, with the convenience of shopping from your own home.

After many years of selling and purchasing items off Craigslist, I’ve narrowed down a few key tips about how to buy on Craigslist and score great deals.

Narrow your search

Most people looking to buy on Craigslist are looking for a specific item. You can search on Craigslist through the search bar at the top and you can type in a few keywords for your item.

For example, if you’re looking for a mirror for your hallway, you can type in â˜mirror.’ However, you most likely have a more specific idea in mind. You may want a brown mirror. And you might want it to be round rather than square. Typing in â˜brown round mirror’ will help narrow your search to the items that will fit the description you’re looking for.

Email with specifics

Once you decide you’re interested in an item, email the poster with specifics rather than an evasive question like Is this item still available?❠Chances are if the post is still up, the item is still available, since posters have the ability to remove a posting once it’s been sold.

A good email example is Hi I’m interested in your item. I am available to view it on (these days) and at (these times). What works best for you? Would you take (this amount) for it?â

Which leads me to my next pointâ¦.

Always Haggle

On most pieces, people are pretty desperate to get rid of an item and they will most likely settle on a lower offer. Unless the writer says they are firm on price, you should always offer less on the itemâ”especially if it’s not a highly sought-after item. It may be harder to haggle on certain electronics, but a good price can definitely be found on furniture and baby supplies.

People who often state that items are part of a moving sale are more willing to let their pieces go for lower prices. Watch our for those key words to determine what you should offer. If I know it’s not a highly sought after item, or if the market is inundated, I usually offer at least 25% less. I fell in love with a dining table that was listed for $500 and completely out of our price range. I offered $200 knowing it was a completely lowball offer, but that was exactly what we had hoped to spend. We ended up settling on $250 and I was so happy.

If you also see that the item has been listed several times, there is a good chance the poster would be willing to sell it for less.

Always remember safety

Always try and meet in a public setting. For big ticket purchases, always bring someone else with you and remember to always let someone know the address of where you’ll be and the time you expect to be done.

Pay in cash and never let the other person know any of your personal information.

Craigslist is perfect for scoring great deals on used items and when you learn how to buy on Craigslist the right way, you’ll be scoring your own deals in no time.

photo by raucousrage

 

Filed Under: Investing

Top Five Ways to Use your Tax Return

April 18, 2012 By

Each year, you might be accustomed to getting a tax refund. You have worked hard over the previous year, and if the government is returning money to you, you probably don’t have any extra cash to spare. Getting a tax refund can either be something that turns into something better if you invest it wisely, or it can be something that is wasted frivolously. Think critically about ways to invest your tax refund. If you are getting a blank on some ideas, then read ahead and discover some time-tested and proven ways that people have traditionally invested their tax returns over the years.

1. Start a six-month fund for rainy days so that you can be sure that you will be ok in the event that a rough economy deals you a swift blow. A lot of Americans were hurt in the last recession, and those that were living paycheck to paycheck did much worse. If your job suddenly ceases, you might not have any options left over but to use your rainy day fund. Chances are, if you got a tax refund in the first place, you didn’t earn all that much in the previous year, or it had to all go to necessary expenses. It’s wise to set aside whatever little money Uncle Sam returns to you until you lose your job. In today’s dead economy, it is a distinct possibility. Just be prepared.

2. Start funding an IRA. If you are not already set up with an IRA, then start one when you receive your tax refund. If you’re not yet 50, you can put in about $5,000 each year. If you’re over age 50, then you will have to put in $6,000 to catch up. Whatever age you are, it doesn’t matter. If you’re still working, then setting aside some money for retirement is one of the best things to put your money toward to. Any windfall that comes in should go straight to retirement. If you set aside all your tax refunds in an IRA fund from an early age, you would have a significant retirement income to live off of. You can just start stockpiling money. You want to retire comfortably and not be working into old age tirelessly.

3. You can also use that money from Uncle Sam to start your own small business. Over half a million businesses were started last year, and the tiny bit of money offered by the government in your tax refund can be a good seed investment in any kind of small business idea you have. You might not want to invest all of your money too quickly, but you can start out small. Make a few bold steps with the little money you have.

4. You can also invest your money in a traditional way. For example, you can use an exchange fund or a mutual fund. If you are a current investor, you can add a lot more money to your current holdings or you can add to your existing portfolio with a lot of new income.

5. You can also start a college fund for your kids. A 529 college fund is the most common one. If you don’t have children of your own, you can always invest in your relatives’ children. People can do this with their nieces and nephews, and a lot of them will end up going to college with the money. It is a great idea for a lot of young people.

These five ideas will help you put your tax refund to better use. Most of these things are essentials. They either critically help you earn more money, or they are for necessary expenses that you have to invest in in the course of your life, like retirement, portfolio, or college. These five things can be chosen based on their importance to your life in particular, and they are not given priority in any standard, necessary way. You have to choose what’s right for you with your tax refund, but these five options are some of the best choices you can make, and it is wise to pick from among them when you are selecting what to do with that money.

photo by hmk

Filed Under: Investing, Taxes

Options Express Review, Get $100 with a New Account!

April 4, 2012 By

optionsexpressOptionsXpress is no newcomer to the game. This company has been around since 2001 and recently became a subsidiary of the Charles Schwab Corporation. They offer friendly, knowledgeable customer service and no hidden fees. They also give you a variety of tradable assets to choose from and you can trade them all in one account. It is possible that this will eliminate the need for multiple brokers. They are SIPC insured and a member of the Chicago Board of Options Exchange.

OptionsXpress Trader Tools

Streaming Quotes, Xtend Platform, Webinars, Virtual Trading

OptionsXpress is a discount broker that offers several tools for traders. One of the main features is the Xtend platform. It is for active traders and offers one click trading and streaming quotes. You can trade options, stocks and futures in the one interface. It also offers a virtual trade mode so you can plan and test out trades.

There are also webinars and educational material offered free to customers. The Xpress Method is their proprietary trading education plan that will allow you to learn options trading, futures trading, and stock, mutual fund and ETF trading. There are tutorials, webinars and workshops. There is a free glossary if you have the need to look up certain trading terms that you are not familiar with. In addition, there is a personal coaching program if you want to take things to the next level.

When you first open an OptionsXpress account, you will probably want to start trading right away, but it makes sense to test out the features of the account before you put real money on the line. You want to be familiar with how the trade execution process works and experience it first hand. There is a virtual trading platform so you can do just that. You will get a 25,000 virtual trading account so you can test out trades and become familiar with the OptionsXpress screens.

What Can I Trade in my OptionsXpress Account?

Stocks, Options, Futures, ETFs

OptionsXpress gives you a wide range of choices when deciding what to trade in your account. You can trade stocks, mutual funds, forex, bonds, ETFs, futures and of course options. Each asset class requires a different set of skills so make sure you are familiar with how to trade before you get started.

Login to OptionsXpress Mobile

Another pretty cool feature is the ability to trade on the go with the OptionsXpress mobile app. There are several platforms that you can use to mobile trade.

  • Browser
  • Software (Xtend)
  • iPhone
  • iPad
  • Android
  • Blackberry
  • Windows Phone
  • Palm WebOS

No Hidden Fees and Free Account Transfers

There are no account minimums or platform fees with OptionsXpress. If you need a broker assisted trade, there is no fee for that either. Option trades are only 1.25 a contract for active traders or 1.50 a contract for standard traders.

Open an OptionsXpress Account and Get Transfer Fee Reimbursed

Open an account with optionsXpress.
Log In, then fill out and print an Account Transfer Form.
Mail the signed and completed form along with a copy of your most recent account statement to optionsXpress.
Fax a copy of your final statement showing the transfer fee to OptionsXpress at (312) 629-5256 , and they will credit your account.

Options involve risk and are not suitable for all investors. In addition, electronic trading poses unique risk to investors. optionsXpress, Inc. makes no investment recommendations and does not provide financial, tax or legal advice. System response and access times may vary due to market conditions, system performance and other factors.

Filed Under: Investing

Is OptionsHouse the Best Option Broker?

March 19, 2012 By

options house reviewOptionsHouse is a brokerage that has been around for a while. It was founded in 2005 by PEAK6 Investments, LP and it has the advantage of the PEAK6 professional trading platform technology. PEAK6 has been around even longer and was named one of Chicago’s 101 best and brightest companies to work for. Even though the software is advanced, the beginner option trader can use the trading platform because it is relatively easy to learn. This options brokerage is SIPC insured so you can have peace of mind when you deposit your money with them.

Why Is OptionsHouse So Popular?

Depositing and Withdrawing from My OptionsHouse Account

When you first deposit money with a broker you will probably want to trade right away. OptionsHouse accepts wire transfers so you can get trading right away. What about nasty fees that banks charge for wire transfers? No problem, OptionsHouse will reimburse your wiring fee for the initial deposit. Initial minimum funding is only $1000 for a cash account but if you want to trade on margin, the minimum initial deposit is $2000. Make sure you use the wire reimbursement code, WIRE25REFUND. It’s also easy to take a withdrawal. If you sent money via wire, you can withdraw the next business day. If you used an ACH transfer, it will take a little longer because the funds have to settle in your account before they are allowed to release them. So just keep that in mind when you are getting ready to withdraw. Also remember that if you sell stocks, the sale takes 3 days to settle before cash is in your account. Then you will be able to withdraw pretty easy by wire, ACH or physical check. There is no minimum account balance so you don’t have to worry about getting charged if your account drops below a certain amount.

What Can I Trade In My OptionsHouse Account?

Options and Stock Trading with OptionsHouse

OptionsHouse allows you to trade stocks, ETFs and of course options. They also offer mutual fund investing and free DRIPs. A DRIP is a dividend reinvestment plan. When you receive cash dividends in your OptionsHouse account, based on your choice, they will automatically reinvest that dividend without charging a trading fee. Reinvesting dividends allows your investment to compound over time. There are several options for trading options. You can trade weeklies, quarterlies and the standard monthly options as well as LEAPs. If you decide to open an IRA with OptionsHouse, you have several trading choices. Once your IRA account is approved and funded, you can buy shares of stock and buy call and put options. You can also sell covered calls and cash-secured puts.

What are OptionsHouse Fees?

Low Commissions and no Hidden Fees

With all of these features, you would think that OptionsHouse charges the same as a full service broker. Well the good news is that although you will get the service and attention that a full service broker would give you, you won’t have to pay an arm and a leg to get it. OptionsHouse is a discount broker that offers stock trades for as low as $3.95. Need to call a broker to place your trade? That’s also only $3.95. There are many brokers that charge upwards of 20 dollars for broker assisted trades. For options trading, up to 5 contracts are only 5 dollars. For more, there is a flat fee of 8.95 plus 15 cents per contract.

OptionsHouse Account Types

Pratice accounts, IRAs and Individual accounts

  • Individual
  • Corporate
  • Roth IRAs
  • SEP IRAs
  • Traditional IRAs
  • Joint
  • UTMA
  • UGMA
  • Trusts
  • Partnerships
  • Investment Clubs
  • Educational IRAs

Ready to switch? They will cover any account closing fees that your old broker might charge. Start your investing journey with Options House today! Options involve risk and are not suitable for all investors. In addition, electronic trading poses unique risk to investors. System response and access times may vary due to market conditions, system performance and other factors. OptionsHouse provides neither investment nor tax advice. Prior to buying or selling an option, a person must receive a copy of Characteristics and Risks of Standardized Options (ODD). Copies of the ODD are available from your broker, by calling 1-888-OPTIONS , or from The Options Clearing Corporation, One North Wacker Drive, Suite 500, Chicago, Illinois 60606.

Filed Under: Broker Reviews, Investing

Betterment Update and Lower Fees!

February 27, 2012 By

Remember that review of Betterment I wrote a while back? Well guess what? Betterment has outdone themselves once again and lowered their fees. Couple that with their no nonsense investing structure, you have yourself a winning retirement savings strategy.

One of the biggest complaints I originally had about Betterment were their high fees. It’s hard to justify investing with a company that has high fees compared to other big names like Vanguard. Well, those fees I used to talk about are no longer uncomfortably high. Betterment has listened to the customer base and lowered their fees. I’m sure this took a hit to their bottom line but it goes to show how “customer driven” Betterment really is. Betterment is a company I trust and recommend.

So, what got affected with this new fee reduction announcement? Well, Roth-IRAs, Traditional Roth-IRAs and all other accounts were affected. Before I go on, did you know that anyone can join Betterment? If you;re considering opening an IRA account, just go with Betterment. They have a broad base of funds and now offer new lower fees.

 

What the fees used to be

Back when I first wrote my Betterment review, the fees were ginormous! They ranged between .3% and .9%! Those are high when compared to the rest of the companies out there. For the average investor, that’s ahuge chunk of change that is just unnecessary to lose to a stupid thing like fees.

 

The good news, lower fees!

Betterment has listened and now their fees are substantially lower! Their new fee strucrure puts them on par with their competitors across the industry. I’m very impressed with this decision. Here is an infographic of their new fee structure:

betterment fees

Notice the drastic change is fee structure? No more .9% fees, those days are long gone. Betterment has revamped their structure to now include just three options:

Builder Plan: For this account you will need a starting balance of $0. You’ll also need to setup monthly deposits of $100. The fee for this account is .35%.

Better Plan: For the Better Plan, you will need a starting balance of $10,000. With this account comes a fee of .25%.

Best Plan: For the big money investors, this account requires that you initially invest $100,000. Because of the high dollar amount, Betterment offers a super low fee of .15%.

Other changes to Betterment

Besides fee restructuring, Betterment is now offering the ability to roll-over a 401k into a Roth-IRA. Betterment also offers the switch from a 401k or IRA into a Betterment IRA. This is a great option for people changing companies or wishing to consolidate their investments. With a broad/simplistic investing platform, using Betterment for this will make sense for most investors.

Start now and get $25 FREE

Are you scared about investing or don’t know where to place your money? Take the burden off your shoulders and let Betterment do all the work. If you’re on the fence, Betterment is now offering a $25 signup bonus! It’s a great time to dive in and get some free cash to start investing. Betterment is an awesome company, so start growing your dollars and stop stressing out!

betterment update

Filed Under: Investing

How Time is 100 Times More Important Than Money

February 23, 2012 By

time more important than moneyAfter finally getting around to reading the 4 hour Workweek by Tim Ferris (I know it took me forever), I am starting to realize the value of time and making decisions to free more of my time up to achieve my goals and do what I really want to do in life.

So, to celebrate this new found knowledge, I’ve been making decision after decision to intentionally increase the amount of time I have in the day to do things I enjoy. At the end of the day, it comes to outsourcing. Yes, outsourcing takes some capital, but it frees up so much of my time!

The following are some ways I’ve outsourced and opened up a huge chunk of time to do more enjoyable and meaningful things:

Hired a nutritionist

So, as many of you already know, I have a honeymoon coming up in May. I know some of you would never care about getting super lean for a wedding, but I do. I consider myself a fitness bodybuilder, so changing my physique comes naturally to me. I love dieting and training hard in the gym. Anyways, I’m on a quest to a lean 200 lbs. and have always wanted a diet to be designed exactly for my body type.

So, the other day, I stepped into one of the offices that is attached to the World Gym where I lift at and asked about programs. For a cool $200, I’m having my honeymoon diet and lifting/cardio plan designed and all the nutrient calculations taken care of me. Now I know what you’re thinking. Couldn’t you do that with Google? Well of course I could, but it would take tens of hours to do the research required. It’s called information overload and I hate it. Having a nutritionist is going to saved me an immense amount of time that I would rather spend planning for our wedding or further building up my blogging empire.

 

Car work done by a mechanic

I consider myself to be handy, but since I’ve moved away from my parents, I have no tools! That leaves me in quite the predicament. I can either buy a variety of tools or relearn how to work on cars, or I can just hire a mechanic and do the work for me. Instead of spending countless hours figuring out problems with my car, doing oil changes, and performing interval maintenances, I’m having my mechanic do all the work. The benefit is the huge boost to my time. I can spend this time doing things I enjoy instead. I know I’ll get some flak for this one but in the long run, the money spend on a mechanic is much more beneficial to me than doing the work myself.

 

Hired freelancers to help with my blog

I’ll be honest, blogging can get busy but I hate doing the remedial tasks like social bookmarking and submitting to carnivals. With plenty of people that are much faster than me at these activities, I have decided to hire it all out. It’s freed up my time to focus on creating the most epic content possible for this blog. In turn, you the reader wins big! If I was bogged down with marketing, you’d get low quality posts. I have also found that since I hire people to work for me, the freed up time has lead me to new opportunities like web property investing and joint ventures. I’m looking forward to seeing more productivity in the coming months ahead!

 

Where do you draw the line?

I’m curious to know how you draw the line between time and money. What are some things you outsource and other things you would rather spend the time on? I know we’re all different so the various answers from people would be really interesting! Comment below 🙂

Filed Under: Investing, Life Experience
banner