Podcast Show Notes
Episode 4: 4 Best Ways to Unintentionally Save Money (Listen to Podcast)
Welcome to Episode 4 of the Dollar Otter Podcast! I’m Nick and today’s podcast is about 4 Best Ways to Unintentionally Save Money!
A recent article from Fool.com reported that the average American has about $4,000 saved. Another article from CNN Money reports that more than 75% of Americans are in debt. So the question then becomes, “How can I save more money while I pay off this debt?”
Great question and I have 4 money apps that you need to put on your smartphone today! These apps will help you start saving money today!
Before I dive in and explain what these are, I want to briefly why I love these apps. When I draft my monthly budget, I am usually rounding up to the nearest dollar. For instance, if a bill that I project is to cost me $2.98, then I round my budget up to $3.00. I never account for the $0.02 anywhere.
It works out well because of these apps mobility to save you money performs the same function. The first app is Acorns. Acorns helps you invest your spare change. I have to be honest, I have a lot of change. My piggy bank is full of quarters, dimes, nickels, and pennies that are earning $0 in interest! That’s how I want you to start thinking about your piggy bank. Much like money under your mattress, it earns you nothing and therefore you are losing purchasing power.
The second app is Qapital with a Q instead of the letter C. It is very similar to Acorn. Both of these lets you save money automatically by rounding up purchases to the nearest dollar and it saves the difference plus both apps give you the ability to invest in the markets.
While both apps are free to download, there are small fees when choosing to use their debit card system or transactions. Acorns charges $1-$3 per month based on your investment, savings amount. I put the terms and conditions in the show notes.
Regardless of its small fee structure, it is still well worth using because it allows you to save your change, earn interest, and it puts your money to work instead of sitting inside your piggy bank.
How many of you shop online? I would venture to guess that 99.99999% of you do. What if you could shop through one app that has all of your favorite stores from Target to Amazon to Whole Foods but earns a small commission from doing it? That is what ibotta does for you. I’ve had this app for several months and I love it.
Since I already shop online, I shop through the app and I earn a small commission just for buying stuff I would have bought anyway. The only difference...I used this app instead of the retailers’ app.
What if you shop at a physical store? You scan your receipt after selecting the items you bought and if there is a coupon in the app, you get that money deposited into an escrow account. Your money sits in an Escrow account until you reach the $20 dollar withdrawal minimum. I reached it my first week so if the limit scares you, don’t let it! You can also earn $5-$10 bonuses just for inviting friends and family to the app.
Shifting gears to a different form of investing, let’s discuss Betterment. This is similar to a robo-advisor and charges range from .25% for the annual fee up to .40% for the minimum balance of $100,000 if you choose the premium account. Betterment is a terrific way to diversify your investments to include taking advantage of tax-saving strategies. They have accounts from IRAs, Tax-Smart Investing, Retirement Planning, and more. With $0 minimum balance, you can deposit money from your app instantly when and where you want and then you can let their systems do the work.
If you are unsure which service is right for you, Betterment does offer advice packages which do charge a $149 starting price. This is for specialized services such as College Planning, Marriage Planning Packages, financial check-ups, etc. but you get matched with a Certified Financial Planner.
If you are worried about getting your money out, with the ease of your app, you can pull your money out quickly. There are no gimmicks which are why I love the Betterment app.
Episode 3: What is Your Risk Tolerance? (Listen to Podcast)
Welcome to Episode 3 of Dollar Otter Podcast. When I was 6, my dad took my younger brother and me to a pon nearby to fish for bluegill. For my other family members in the south and my friends...that's brim. This fishing hole was surrounded by trees but a short truck ride from our house.
I remember the buffalo slowing grazing and walking over as we fished. This pond was special. I remember as the sunset had already set, there was just a peak of light left with the moon casting down its glow. Fireflies were out showering the pond like Christmas lights.
One after another we were catching bluegill. I had a goal to catch twenty fish no matter. And I did. This may have been the same hungry fish biting my hook over and over to eat the worm but in my six-year-old mind, I had the tolerance to fish through the night chill and mosquito bits because I was determined.
I learned tolerance early but risk tolerance when it comes to investing...well, that's different. One's life experience and challenges shaped that. During the Iraq war, I was stationed outside of Baghdad and worked the night shift. With the long nights, I decided to invest in penny stocks. Fast forward three months and I lost $3,000! Needless to say, I refuse to invest in Penny Stocks--no matter what because that experience shaped my risk tolerance.
What is your risk tolerance? There are so many variations that many investors aren't even aware. There is capital risk, inflation risk, timing risk, reinvestment risk, market and credit risk, and on and on.
The risk I want to talk about is investing risk. To know your level of risk is determined on your investment horizon. If you are investing for the short-term, let's say 3-6 months, it is not wise to put your money in the stock market. That would be an excessive and unnecessary risk to take when your time horizon is very short and should the market dive down, it would be difficult to regain those losses.
When you have a short time horizon, you must protect that principal amount.
If your time horizon is 20-40 years, then the stock market is more appropriate because the investment has time to regain any losses that may occur in that period.
So before you invest, ask yourself, "What is my risk tolerance?"
Thanks again for listening to this podcast. Be sure to check out our weekly blog, and until next time, have a wonderful and blessed day!