Before we being, I want to point out how much I love driving. I love my car too. It’s fun being in control and flooring it (within the speed limit of course) every once in a while. So I’m not advocating getting rid of your car to save money. Besides, I live in Texas. So it’s not like it’s even feasible for me to live without a car. But it’s still an interesting exercise to see how what’s the total cost of ownership for my car.
“What am I missing?” These are the four most important words in the world of investing. If you want to invest like a professional, this is what you always need to ask yourself. Unlike, “This time it’s different”. If you hear an investor say this to you, run away! Don’t look back and run away as fast as you can, preferably in a zig zag pattern so he doesn’t get you!
As an institutional investor, I focus solely on the numbers. My valuation is based on a set of verified assumptions. I look at where something trades vs. historicals, and my upside/downside is based on probabilities. I’m just kidding. It’s true, I look at all those things, but sometimes you just need to go with your gut. When you meet with a management team and they sound confident, sometimes you just need to buy the stock because you think they’ll deliver. Hate selling is the opposite that.
You’ve heard it a million times before. If you want to save money, bring lunch from home. Make your own coffee. Cancel your cable bill. Don’t have a life and don’t have fun. Yes, these are all very good suggestions on how to save money, but you’re giving up convenience in return. So how would you feel about saving $150 every year, without any inconvenience other than spending 5 minutes a month? Let me ask you, how often do you check your tire pressure?
Including dividends, the S&P 500 has more than tripled from the lows in 2009. Last year, the S&P 500 was up 12%, and this year’s it’s up 16% YTD. with such strong performance, everybody should be happy, right? Well, not exactly. If you’re long the market, like most retail investors, this has been great. It’s basically been impossible to lose money in the past eight years because stock valuations keep on going up. Like you would have to really, really, try hard to lose money. Like invest in known fraudulent companies. Or companies that have told you they’re going into bankruptcy.
I know what you’re thinking. “Yay! The IRS raised the limit for 401k contribution limits! Now I can put more money into that sweet, sweet tax-advantaged retirement account because I’m a responsible adult that can delay instant gratification and I like to plan ahead.”
Yes, I know all of you are thinking just that.
Bonds are like top hats; you shouldn’t rock them if you’re under 50. I’m an equities guy so my view is biased, but I don’t understand why anybody under 50 owns bonds in this environment. Just so we’re clear, I of all people should be pro-bonds. I have so much more sensitivity to the stock market compared to the average person. Not only are most of my investments in equities, but my job is tied to the market as well. So it’s important for me to diversify away from stocks. Yet I still don’t believe it makes sense to own bonds right now.
Do you believe time is money? Well, money absolutely equals time. If you want to get somewhere fast, you can pay up and take the toll road. Want to get there even faster? Take a helicopter. Not fast enough? Then get a jet.
I like the jet option the most, especially when it’s private. Not having to show up hours early for your flight is a real time saver. And if we’re lucky in the future, we’ll be able to get places even faster with rockets. I always knew Wile E Coyote was an underappreciated genius.
The point is, with enough money, you should be able to get anywhere lickety-split, preferably in style.
Continue reading “Time is Money (Only if You’re Getting Paid for It)”
If you’re like me, shopping on Amazon is a godsend. I’m a Prime subscriber so everything ships for free, in two days. On occasion, we’ll get packages in one day or even the same day! Sometimes I wonder if Amazon somehow knows what we’re going to buy ahead of time and just ships it to us.
The wide selection of products on Amazon is great. But what truly makes it a life saver for those with kids is not having to leave the house! It may sound unbelievable for those without kids (lucky you), but it literally takes us at least 30 min to just get ready to leave the house.
I’m going to say this upfront. I don’t go to the theaters much. With three small kids, my viewing options are limited to My Little Pony or whatever kids movie is playing that week. I’ll pass (no disrespect to all those Bronies out there). But if you are a movie buff and like to go to the movies, then MoviePass is for you! Recently, they lowered the subscription price to $9.95 per month. What does that get you? I’m glad you asked. According to the website, you can watch, “Any movie, any theater, any day!”