Holiday Giveaway!

Thanks for reading my blog!

In the spirit of the season, as well as the intent of my blog, I am hosting a holiday giveaway.

The requirements for the giveaway are easy...

1.  Leave a comment on this post on why you like/dislike the blog with a valid email address.
2.  If you don't want to leave your email on your comment, email me at futurethinkdollars@gmail.com with your email address, and make sure to reference your comment.

There will only be one winner picked by a random number generator, and the deadline for comments is noon on New Years Day.

In short, you can only win if you leave a comment!

The giveaway is a finance related item (less than $50), in the spirit of the blog.

Winner will be notified by their email address with which they enter, and will be mailed their prize.
(Future Think Dollars is an anti-spam entity, and will never distribute your email address for any unauthorized reason. That bugs the crap out of me too when sites do that!)

Have a safe and happy holiday season and Merry Christmas! (Future Think Dollars will return soon!)

Seek explanation

Another perfect example of why you should always consider the source of any information given/told/shown to you when it comes to your investing choices.

Just because someone is showing you pretty graphs, pictures, or reports, should not sway your natural instinct which should be caution.

Just like someone who walks into a car dealership without any information on invoice pricing will lose, so will you. There is easy to obtain knowledge about negotiating that will prevent you from getting taken advantage of, and the use of information prevents these types of financial matters.

While it sure would be nice if everyone just took good care of their neighbors, it's just not realistic.

Do your own follow up research on anything financial related before making a decision. If anyone has a problem with that, or tries to pressure you, walk away.

There are always more opportunities out there, and if the person in front of you is not willing to explain things so that you can understand them, you should be looking for something else.

Delayed Gratification, in marshmallows!

I talk about how important it is to delay gratification, or in plain terms, save more and spend less! The idea is the more you save now, the more you will be able to spend later, and the power of compound interest is what really makes the whole process incredibly valuable.

This video sums it up in a hilarious way, and I think it's a fantastic and quick video!

Check it out!

Index funds win again

It is my belief, and many others, that a low cost index fund portfolio will beat an actively managed one. This is what I base my portfolio on.

I consider myself a pretty lucky person, but I do not think I am lucky enough to win against a stacked deck. The stacked deck in this case are the lower returns you will get from a higher cost fund. It's just not worth it!

"They found that outside the top 3% of funds, active management lags results that would be delivered due simply to chance."

 Image: © 2009 TNT Fireworks, Inc.

Marketwatch Article

"Investors who continue to send money to actively managed mutual funds in the hope that managers will be able to beat less-costly index funds are going to lose out almost all of the time, a new study finds."

Another great example of why it makes a whole lot of sense to have a foundation of index funds, instead of relying on a lucky strike against a stacked deck.

Sometimes a buddy of mine will respond to a conversation with, "You're just trying to get rich!"

This is probably due to my zealous approach to explaining the power of compound interest.

My reply is: "I'm just trying to be financially independent!"

The first goal should just be saving to make sure you can retire when you want and still do the things you want without stressing out about money. Once you start looking at it this way, it makes a lot of sense when you start changing some of your behaviors. The power of compound interest is just too ridiculous to not take advantage of.

In previous posts, I have tried to highlight this, in the interest of bringing more attention to the concept, and ease, of saving for life after your career.

My personal aim is to be financially secure for my spouse and I's benefit. There are some who choose to "hate" on this concept, with an accusation of "trying to be rich."

To that, I reply, "Is financial independence such a horrible goal"?

I leave that to my readers to decide, but I hope to spread the knowledge that this goal is attainable for anyone. All that is required is a desire to learn the basics, and apply them!

$5 albums

Amazon is offering 100 DRM free albums for $5 each during December.

I started buying music on Amazon for their specials they have on new albums. They often offer brand new albums for MP3 download at the price of $3.99. This price is usually only good for a day or so, but when I see something I like, I try to take advantage.

Hopefully you can save some money on some albums you wanted to buy!

Waiting to buy something

Is there something you want to buy the next chance you get? Do you have your eye on a new couch, a new mp3 player, or a new car?

You may find that the longer you defer, or delay, a purchase, the less necessary it will seem.

A prime example for this could be a new car. As you continue to drive an older car, you are avoiding a new payment. This is an easy concept, but the other savings you are keeping may not be as easy to identify.

By waiting, you give yourself time to think about the necessity of the purchase. You may decide to buy something cheaper, or decide on not buying it at all. You could also end up getting a new model by waiting a little while before you buy.

A habit of mine is to check online prices for nearly everything. Even things you wouldn't normally buy online are available. Even if you don't buy the item online, this gives you a good frame of reference for what is available.

If you give yourself extra time on a purchase, you give yourself time to try to save money on it.

Investment choices

There are times when there seem to be no good places to put your money. These are the times where everyone is talking about how the stock market has been slamming them, and the banks aren't paying great interest rates anymore. During times like these, don't let frustration move you to decisions you would not have made otherwise. During one of these periods, you get impatient, and you may want to make big changes to your savings strategy. Don't let your emotions get in the way of making sound investment decisions.

Give your decision some time and if it still makes sense to you, especially after hearing counter points of view, it may be wise to take action.

I have made bad investement decisions, and I have made good ones. My mistakes most often were made when I acted without fully thinking through the options!