Blog – Page 110

Left: a filthy toilet filled with homeless people. Right: an abomination in the eyes of the Lord.

So the free service you got with your iOS upgrade isn’t as good as you wanted it to be. You know you can still use the service it replaced, right?

When did we become such a society of whiners? This isn’t a tainted pork recall. This is free. There’s nothing to refund to you if you don’t like it. It’s not endangering your life. Taking everything into consideration, Apple Maps is still pretty impressive. But if you’re not satisfied with it, you can easily visit Google Maps and that’ll make it all better. Now grow a pair and read this week’s Carnival of Wealth. Again, personal finance blog posts from around the globe. We’ve gone weeks now without a legitimately awful post. Will the streak continue? Let’s get started:

Apex posts at Free Money Finance about the benefits of investing in real estate. His information is good, but you should probably save this one until the end because there are hotel telephone directories that make for more gripping reading.

Apex’s final point is his most profound: real estate is pretty much the one investment that lets regular people leverage their portfolios. Leveraging most other investments – using other people’s money to expand the reach and influence of your own – requires millions of dollars to begin with. But in theory any idiot with decent credit and the desire to learn can enjoy huge cash-on-cash returns via real estate.

Fellow libertarian lunatic and political pessimist (the 2 are kind of interchangeable) Ken Faulkenberry at AAAMP blog explains exponential growth to the innumerate among us. Be wary the next time you hear a talking head or a stock analyst assume that growth proportional to current value will continue indefinitely. Some external factor always curbs that growth, or at least reduces its rate of increase. We live in a finite universe, depressing as that may seem.

A new entrant this week, Chris Fuller at Life With A Brain. We like his blog’s title, and the body of work he backs it up with is not awful. Chris runs the numbers regarding how long it’ll take you to achieve financial independence, and what inputs you need to get there. His post contains not only charts but logarithmic functions, and if you think that math is too hard, understand that lots of people – including the ones who keep you chained to a desk and miserable – don’t.

We first read the title of this post from Cameron at DQYDJ.net as “Why I Don’t Own a Phone”, and were simultaneously puzzled and envious. Then we saw the one letter we’d missed that changes the title’s meaning drastically. Cameron claims to own something called an LG Remarq, which has got to be a made-up name.

Odysseas Papadimitriou at Wallet Blog wonders if the United States government protects tax evaders. Wait, isn’t that self-defeating? Actually, it isn’t. He means foreign tax evaders, with accounts based stateside. You’ll be happy to know – unless you’re a foreign national who foolishly thought that “land of the free” still meant anything – that since April the IRS requires American banks to report interest payments over $10 to the governments of certain non-resident aliens. So unless you want to divide your $10 million fortune among 1,000,001 different U.S. banks, you’re kind of screwed.

There are people who refinance their cars? You really do learn things by hosting the CoW every week. Charles Davis at Wallet Hub, Wallet Blog’s little sister who loves to experiment and wear skimpy clothing, explains the phenomenon of car refinancing to a heretofore ignorant carnival barker. If you can find a bank willing to pay off the loan on your young and lightly used car, you can possibly save some money. Of course, the length of term for a car should be several times less than for a house or any other asset that’s typically amenable to refinancing. Fortunately, the “closing costs” are proportionally lower still.

Another one from the Evolution Finance family? Indeed. John Kiernan at Card Hub asks if prepaid cards are risky. Technically, there shouldn’t be any risk if you pay up front. There might be lunacy, but there shouldn’t be risk. That’s unless you remember that prepaid cards aren’t necessarily FDIC insured, which means that if your lending institution dies, your prepaid card balance could go with it.

Dan at ETF Base points out that the price of gold and the price of gold mining stocks, while obviously connected, aren’t necessarily correlated in the marketplace. Gold has outperformed the companies that dig it out of the ground – Barrick, Newmont etc. – for some time now. Why? Because gold manufacturers often attempt to lock in prices in the event that production would increase (and gold prices, presumably, would thus decrease) in the future. Fun fact: the aforementioned companies and at least one of their peers are currently producing gold at $700 an ounce. That’s not only less than half the spot price, but obviously enough to keep said miners exceedingly profitable. Dan argues that a likely result is that gold prices will eventually revert to the mean (i.e. lower) while mining stocks will do the opposite.

Dividend Growth Investor has another post on, well, dividend growth investing. He suggests that maybe it doesn’t make sense to do your fundamental analysis, locate a suitable dividend growth stock, take a healthy position in it, watch it appreciate, and then…sell it? Because an appreciating stock is a bad thing? Remember, there’s no such thing as being dividend rich. There’s just being rich.

Ready to hire a financial planner? Michael at Financial Ramblings says that that’s an investment like anything else. You make your money going in. Figure out how much a financial planner’s time and expertise will be worth to you, and then act accordingly. If you don’t know where to start assessing a financial planner’s value, that’s what the post is for. Read it.

W at Off-Road Finance is an independent thinker with little patience for idiots, which is why he doesn’t have as many followers as something easily digestible and full of repeated platitudes as, say, Financial Samurai. This week W illustrates his disdain for the kind of personal finance writer who assumes that rates of return are constant over centuries.

Think about it. Greece is the most indebted country on the planet per capita, at least until Barack Obama gets reelected and the Democrats take over the House. Yet Greece had a 2½-millennium head start on the rest of us. If someone in the time of the Peloponnesian War had saved a single drachma at prevailing rates, that person would own the solar system by now. This and other absurdity debunked in W’s post. Essentially he argues that if your returns get too large, diminishing returns will kick in soon enough. This post is a little profane, but eclectic and vital.

One reason we dig Andrew at 101 Centavos is that he’s the antithesis of a generic blogger. If anyone else wrote a post entitled “How Much Is Too Much Money?”, it’d be a lament on those greedy capitalists keeping the working man down. Andrew contrasts 2 companies in the same industry, one with great financials and a modestly paid executive team, the other with awful financials (in an industry in which any moron should be able to make money) and unwarranted multimillionaires running the show. Which company would you rather invest in?

This is unusually specific, but what the hey. Harry Campbell at Your PF Pro gives methods for saving money at Chipotle, the assembly-line Mexican joint. Harry was inspired by an awful post entitled “15 Ways To Save Money At Chipotle” by a blogger whom he was too polite to mention, but that decorum requires we out as Danielle Warchol at Saving Advice. (She suggests that you go to your local store dressed head-to-toe in aluminum foil, at which point the employees will supposedly take pity on you and charge you $2 for a burrito. She also suggests sharing what you order with another person, which will thus halve its price. No, this woman didn’t directly submit to the CoW, but if you’re going to spew garbage like that we have the right to make merciless fun of it.)

Oh yeah, Harry’s post. Harry suggests loading up on free condiments. If they give you one type of salsa free, shouldn’t they give you 4 types of salsa free? Harry, you’re edging awfully close to Trent Hamm territory here. Also, Harry is the kind of retail customer whom the customer succeeding him in line should be allowed to take out with a poison dart:

I like to ask them to mix up the bowl or burrito so that all my bites will be evenly mixed and I won’t eat any huge chunks of one element.

Harry knows that Chipotle employees can’t add bodily fluids to his meal, given that they’re standing right there. We’re cutting Harry some slack because his previous posts were OK, but he’s now officially on watch.

And thus ends another Carnival of Wealth. We’ll be back with a new post Wednesday, and a new Anti-Tip of the Day tomorrow. Check us out on Investopedia, too. ‘Til then.

We’d like to take the credit for giving this photo the Roy Liechtenstein treatment, but that’s all Trent.

We try to mix it up, really we do. But sustained excellence is something to be cherished and noted, not downplayed. In 1997 the NBA named Karl Malone its most valuable player for no better reason than the voters were tired of giving the award to Michael Jordan. Malone’s Utah Jazz met and got eviscerated by Jordan’s Chicago Bulls in the finals that year, and the following one, leaving one to wonder what might happen to that poor (literally and figuratively) chubby self-indulgent whore from So Over This were she to square off against Trent Hamm in this year’s Financial Retard Championship Series.

Yes, the sage behind The Simple Dollar is our honoree yet again. For those of you unfamiliar with Trent Hamm’s act, he’s a socially inept hypermiser who tells his mouth-breathing minions to save money by making their own toothpaste, not turning the oven light on, and swimming in their underwear. (That sentence sounds like a hyperbolic attempt at humor. We swear on our account balances that every word of it is literally true. And we’d link to the offending stories, but it’s easier for you to just go into the search box at the top right of this page and enter “Hamm”.)

Having conquered the realm of personal finance, Trent Hamm is now going to take on relationships. He and his lovely wife have figured out the way to eternal happiness, and in between the child-rearing and collecting of rocks by the roadside (another literal truth, search our archives), it involves some wildly unimaginative gestures:

One of the most effective ways to cement our relationship and keep it strong is something incredibly simple that costs almost nothing and is something people have been doing for hundreds of years.
I just write a little note for Sarah and stick it somewhere where she will find it later.

The more of Trent Hamm we read, the more we’re convinced that his father used to beat him with a giant wooden nickel. No one can hate/fear money that much without having a lasting reason. Don’t just send notes because it’s something couples do, do it because it’s cheap!

Later in the same post, just in case you missed the part about how cost-effective leaving notes can be:

It takes a few minutes to do and it’s practically free.

So once you’ve written a note, you should gingerly place it atop the summit of K2 or inside Fort Knox, right? Or perhaps you should seal it inside a bottle, toss it into the ocean and hope for the best?
Wrong:

stick that note somewhere where your partner will discover it. Drop it in a purse. Tuck it in a wallet. Stick it in the console of their car.

You see, if you place the note per Trent’s directions, the object of your note will then find it. Finding the note is the key to having it read.

The above tip has nothing to do with personal finance, evidence that Trent might be slipping in his dotage. The old, hungry Trent would have given stationery prices and explained much you can save on ink if you don’t dot the i’s in said love notes.

It takes more than just a sappy and pointless observation to qualify someone for Financial Retard of the Month status, however. Earlier this week Trent went on a rant about “mindfulness”, in response to a “reader” (named Trent) who “wrote an email” (that is, thought to himself) about how to be frugal. Of course. Here’s Trent on mindfulness:

Let’s say I’m thirsty. We’re on a long road trip and I’m feeling a little drowsy, too. We stop for gas at a gas station, so I head inside looking for a beverage, since our cooler is empty.
If I’m not mindful, I’d just glance for the first high-energy drink, buy it regardless of the cost, and happily head out to the vehicle. It’s tasty, it’ll give me an energy boost, it’ll quench my thirst – why not?
There are a lot of factors involved, though. Is it healthy? Is the package just going to get tossed in a trash bin? What does it cost? Will I actually feel better after consuming it or just get jittery? Do I respect the company that makes the product? Am I setting a good parental example?

The superfluous words in his sloppy writing never get old. “We stop for gas at a gas station”, as opposed to stopping for gas at a hardware store.

You want to know how to be miserable, indecisive, morbidly obese and stuck in Iowa? Ask yourself half a dozen questions before doing something as routine as buying a drink while your Prius fuels up.

How does this nut make it through the day? What happens if he finds a drink that’s healthy, and that comes in an decomposable and/or edible package, and that’s inexpensive, and that will make him feel better after “consuming”* it, but that comes from a company he doesn’t respect, and that makes him set only an indifferent parental example? That’s 4 out of 6, right? A passing grade.

The only thing more depressing than our nation’s $16 trillion budget hole is that Trent Hamm has 92,675 readers (according to the latest Feedburner data.) If you’re one of them, and God help you if you are, get out now while you can. If spending 99¢ on a bottle of Aquafina requires that much conscious thought, think about what you’ll be getting into if you ever have to buy a house. As for how to buy a house, read Chapter VIII here. You’re welcome.

*He means “drinking”, for all you conversational English speakers out there. Trent is also the only person on Earth who routinely says “children” instead of “kids” and “automobile” instead of “car”.

Carnival of Wealth, Apple Maps Edition

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