Money Musings š When all you want is simpleā¦
You pack up to move and become nauseated by how much stuff you have. How does it all fit in those cabinets?!
Or maybe you help someone else move and vow to rid yourself of all of your belongings and live a minimalist life.
Anyone else experienced this? š
We live in a consumerist culture but itās become very clear to me that there is a real cost to having so much stuff. There's...
Having a place for the stuff to go
Keeping all that stuff organized
Finding the stuff when you want to use it (I hate nothing more than wading through all my stuff to not find the thing I know I have!)
Fixing the stuff if it breaks
Finding the stuff a new home when you no longer need/want it
The cost we pay to purchase it
Not to mention the resources it takes to make the stuff
Less stuff is less to manage. Itās also more money in our wallets.
This urge to simplify has seeped into other areas of my life too.
I want to have as few accounts as possible, fewer expenses to track, a simpler meal plan for the week and am even more grateful for apartment living (less space to manage!).
Iāve even committed to a more open and uncomplicated schedule. As someone who used to stack meetings and build in the exact commuting time I needed, this has been a BIG wonderful change.
As you can tell, Iām a changed woman. Simplicity for the win. š
What other areas can I simplify? Whatās made the biggest difference for you?
MONEY MOVE OF THE WEEK
WORK OPTIONAL CHECK-IN #4 - LOOK AT YOUR INVESTMENTS.
The last piece of the work optional check in is to look at your investments. We often use the phrase āsaving for retirementā but really, weāre investing for retirement.
We want the money in our retirement accounts to be invested and growing for us.
AND the longer we have until we retire, the more time we give that money to compound exponentially for us. Itās a beautiful thing!
While thereās more to know about retirement investing than I can share in one money move, I do believe I can teach you everything you need to know in about two hours.
Check out this article to learn more and for the full deep-dive, read chapter 7 of Financial Adulting.
Some key things to know:
Make sure your retirement savings are invested. This is a common mistake that costs us thousands and thousands, if not millions of dollars over the course of our lifetimes.
If you are young, make sure you are taking on enough risk. Good risk = return (aka profit). If you are in your 20ās or 30ās the majority of your retirement funds should be in equities.
Look out for expenses. Every investment fund will have a fee in the form of an expense ratio. This will be a percentage fee that you are charged each year for owning the fund. It depends on the type of fund (and whatās available to you) but I typically consider anything above 0.5% to be high and I try to invest in funds with expense ratios well below that.
Itās better to start than to be perfect. My first retirement account was a hot mess BUT Iām so glad I got started rather than waited until I understood everything. Do some research, but then get investing. You can always adjust as you learn.
YOU GOTTA SEE THIS
DEFINE MONEY MARKET FUND VS. MONEY MARKET ACCOUNT.
While these accounts are far from thrilling, they are different and get confused a lot. Letās break it down.
DEFINE MONEY MARKET FUND. These are funds specifically invested in short-term U.S. government bonds called Treasury bills or āT-billsā and are very low risk. These are a type of bond or fixed income investment.
DEFINE MONEY MARKET ACCOUNT. A FDIC insured bank account that usually offers an interest rate in line with a savings account but you can write checks from it and may even be able to get a debit card. There may be withdrawal limits.
How do I remember the difference? The last word - fund vs. account. One is an investment and one is an account.