This past week I took another step toward aging out of my “Money at 30” moniker. That’s right, I’m now 33 years old. I’d call this a “milestone,” except I don’t really know of anyone who finds 33 to be a particularly notable or interesting age. Nevertheless, as I’ve done in year’s past, I figured it was only right to kick off my 34th year by discussing some of the money topics that have been on my mind lately and what some of my goals are for the months ahead.
Money at 33: My Financial Goals for This Year
Mapping our money
One of the side effects of writing a weekly finance column is that I end up encountering a lot of products and services I’d like to review. Moreover, since I want my reviews to be as in-depth, honest, and helpful as possible, I make sure to spend a fair amount of time using whatever product I’m talking about. This is easy enough when I’m just covering a new app but, in the cases where I want to review a bank account, well… you can imagine that I have quite a few to my name.
That’s why, this year, I’m making an effort to ensure that all of these accounts serve a particular purpose. Furthermore I intend to create a flow chart of sorts, dictating where our money should go to get the most out of it. Incidentally, at nearly the same time my wife and I were discussing this “money map” idea, Jim from Wallet Hacks put out an article addressing pretty much the same topic! This let me know I was definitely on the right track.
Over the weekend, my wife and I started figuring out this flow chart, starting with our main checking account and then extending to a couple of online bank accounts which have with far more attractive APYs. The next step is figuring out just how much we want to have in each account in order to maximize our earnings, while still maintaining accessibility. As luck (or clever design, I’d like to think) would have it, each of the accounts in question offers a different mix of these two aspects, thus there are reasons to use each of them.
On a somewhat related note, after spending the past year watching my credit card rewards balance grow, I realized that my strategy of waiting to earmark those funds for something fun wasn’t exactly working out. While it was a nice theory, nothing had come along that I said, “that’s what they’ll use them for!” So, with my Uber Visa cash back tally totaling $650, I decided to transfer $500 to my Discover savings account. Now, instead of letting Barclays hold that money for free, I’ll be earning 2.10% APY on it. To me, this seems like what I should be doing going forward.
Upping our investments
When I turned 31, I noted that it was time I started investing. Well, I did — but to a very small degree. To my credit, while I have used Robinhood to purchase a small portfolio of stocks, we’ve also been good about contributing to our Roth IRA, which is invested in a mutual fund. In fact I’m proud to report that we just maxed out contributions to that account for 2018 (although I still have a traditional IRA we could max out as well).
Anyway, after reading Tanja Hester’s upcoming book Work Optional (watch for my full review next Tuesday), I’ve decided to get serious about our investing efforts. Now, this isn’t to say that I’m going to become a day trader and apply my very limited technical analysis skills to time the market. Instead, we’re looking at opening a brokerage account and contributing monthly to an index fund.
I will say that I have yet to actually choose what brokerage to go with or weigh the pros and cons of different options but I do plan on getting all of that set up by, say, Q2 or so. In turn, I look forward to making investing a larger part of this column and my Money@30 site.
Reconsidering spending we take for granted
Finally, while my wife and I have always been good about looking at our spending and realizing when cuts can occur, this year I’m reconsidering a couple of things that we’d previously ignored. Topping the list: our cell phone bill. Personally I’ve been with AT&T since whenever the iPhone 3G was a thing, while previously having my decades-old phone number with the other three major carriers at one point or another as well. Having had no real issues with the company, I just continued to stick with them. However I did recently realize that this monthly bill was one of our largest. As a result it seemed that, if we really wanted to make an impact on our spending, we should start at the top.
This line of thinking brought me to investigate T-Mobile. I’ve heard for some time that they actually allowed you to use data overseas for free, which definitely appeals to me as an aspiring world traveler. Looking at their plans, it also seems that we would save on our monthly bill compared to AT&T — although not by as wide of a margin as I initially thought considering that their upgraded “One Plus” plans have some other enticing perks.
Honestly, even though the math is in favor of T-Mobile at the moment, we’re still having trouble deciding what to do. It seems that our hang up (pardon the pun) is in regards to quality. That said, is AT&T actually better or do we just believe it is because they’re more expensive? At this point, I don’t really know — but it’s been an interesting discussion to have.
By the way, next on my list after figuring out our phone bill is reassessing our car insurance. In this case it’s the perceived benefit of being loyal that’s keeping us with Geico and it’s been years since I last requested a quote from elsewhere. Frankly our car insurance bill is far from our largest monthly or annual expense but, if we can end up saving more money, shouldn’t we? That is the question…
So there you have it: my financial goals and thoughts going into this new year. Overall I feel motivated, excited, and intrigued by these topics and I hope all of this comes across in my future writings. With that, thanks as always for reading Money at 30 and Money@30 (yes, there’s a difference) — here’s to another great year.