Acorns: Small Investments in Your Future

Acorns: Small Investments in Your Future

Last year in December (of 2015) I enrolled in a little-known application called Acorns. This company would look into your transaction history; all of your credit card and other purchases, and then round up to the nearest dollar from the purchase and take the difference. They’d these small amounts of money up, anywhere from 1 cent to a dollar, and once you had $5 available, would invest these micro-investments into a series of mutual funds.

 

I didn’t expect much out of this since we’re talking literally pennies per purchase. But I was wrong. Site after site emphasizes the importance of investing whatever you have to work with. So while I invest already in a number of different ways, I decided to give this a try. From $5 onward my balance slowly started to grow. Eventually I started to see returns outside of my investments as dividends were given and funds sold. I don’t ever expect this to become a nest egg for me, but I do use it for an emergency fund. I slowly invest as I make additional purchases, and it acts basically as a savings account earning around 3% for me. If I had an unexpected expense like maybe one of my cats got sick, I’d just withdrawal from the account and be on my way.

Normally you can get $5 when you sign up but they seem to be running a special where you will get $10 free for signing up. Check it out here.

 

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2016 Financial Year in Review

As I normally do at the beginning of each year is to reflect on how things went in the previous year. Topics are a general reflection, financial, and fitness. This is the first of these posts.

Dining

In general I spent 6.90% less this year on dining than I did last year. However, I am spending too much of my dining budget (and exceeding my planned budget for dining) the majority of months. The top three categories: dinner, lunch, and alcohol, I have a lot of influence over. Instead of ordering out or dining out for dinner, cook food. Instead of going out for lunch every day at work, bring a lunch a few days a week. As for alcohol some of this will drop as dinner dining out goes down, but also spend less time drinking, reserve it to not drinking during the week, or perhaps go on discount days like Goose Island does.

2016 dining breakdown by category

My analysis has shown that even though I eat out more often the overall cost of the meals are less. I believe I have identified the reason because at my last company we would grab drinks during lunch or after work pretty often. I don’t do that now. This would account for a large amount of the nearly 7% decrease in overall spend.

Groceries

Ideally I wouldn’t spend as much on groceries as I do dining but also that groceries last longer and make more meals. This is true for 2016, but I’m spending more, 17.5% more, on groceries this year than last. Additionally, as seen in the graph, the “Other” category is the largest group, which means that I need to determine additional categories to track against.

2016 groceries by type

Meats are by far the most expensive, so reduction in meats will result in less cost as well as healthier eating. Generally though I need to plan out my meals better to make grocery shopping more efficient. It’s also important to note that just because I don’t spend a lot of my overall grocery spend on fruits and vegetables doesn’t mean I don’t buy them often. These are normally much cheaper than meats and therefore don’t contribute to a lot of my overall spend. I have entire grocery visits of just vegetables and fruits.

Additionally, the $35 a week experiment that I did a few years back seemed to work pretty well. So if I up that to say $50 a week so that I can get leftovers enough to also bring lunches, this should influence both budgets in a positive way.

Travel

Did I travel more in 2016? Well, I don’t think so, but I did spend more on travel overall, nearly 53% more to be exact. Where did the increases come from? I did take a few trips this year but didn’t rent a car or have large expenses with them. I had a nearly 38% increase in airfare costs this year. This could be caused by not having the points budget at the time of travel to not have to pay for tickets. Airfare is also increasing in cost.

I started spending on tolls this year whereas I didn’t at all last year. This is caused by having a job that requires me to travel to suburban areas of Chicago now and there are tolls on the roads. With this change, I also recorded a 171% increase in gas spending this year. Again, this is due to having to drive to the suburbs for work.

Financial Health

Spending doesn’t really give a good picture of overall financial health as this category does. I’ve broken this down into four categories: saving contributions, investment contributions, retirement account worth, and overall net worth.

This year I recorded a 58% increase in my savings contributions. This means money I put into saving accounts increased by 58% in 2016 over 2015. It’s a pretty large amount and this year I’ll probably reduce that some to allow more to go into investments instead, where I can potentially get a higher return.

As for overall investments (which are contributions made to investment accounts – not retirement or 401(k) or the like) I increased overall contributions to these accounts nearly 47%. This doesn’t reflect a 47% increase in net worth, per se, just that I contributed 47% more to them. I didn’t calculate overall net worth change for these accounts.

Retirement account contributions (things like IRA contributions and 401(k)) also rose in 2016 by 26%. Again, this does not reflect overall increase in value, just contributions. I didn’t calculate value change, but I do know it’s higher, not as high as 26% but I did have a very good year and is in the double digits.

Lastly, and probably the most telling metric, is net worth. Take all your account balances and assets, subtract the debts and liabilities, and you get a value. That’s your net worth. This year was a good year for debts and liabilities for me as I finished paying off all of my student loans in December of 2015, five years ahead of schedule. Therefore this is my first year completely debt free. Overall my net worth increased nearly 5.5% in 2016. While I’m quite proud of that number I hope to increase it with smart investing and savings and reducing overall spending.

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Government Works for the People

“The President works for us. Congress works for us. So when people say ‘oh, do you want access to a Senator so you can try convince him/her…’ I want access to the people. In a Democracy that’s supposed to matter.”
— Neil DeGrasse Tyson

If you congressional leaders won’t take your calls and ignore you letters – fire them.

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2016 Election: Some Thoughts

It’s been nearly two weeks since the 2016 election and I’ve had some time to digest what has happened. I can’t claim I understand everything that has happened and I think we are all going to have to prepare for four years of the strangest president in the history of the United States. I do understand that people are fed up with Washington and this was a way for them to not only get back at the politicians but also Donald Trump goes against the status quo. However, the election of Donald Trump is a very serious concern. The views and opinions he has shown us this year are dangerous and backwards-thinking. So what can we do? I’ll break down some of my ideas that might help in the next four years. Yes, I’m ignoring the thoughts that he will be impeached. To make a plan that doesn’t span his entire term, perhaps even the idea of both of his terms, is irresponsible to say the least.

First, let’s talk about funding. Yes, there is a pretty standard list of organizations that you can (and probably should) support to help them through this trying time.

These organizations will need your help more than ever and should be funded. Moreover, you should fund them on a regular basis. Most should have an automatic or recurring gift option and every dollar helps. Donate at least $25 each month to these organizations. Best of all: these donations are tax-deductible!

Excluding these organizations I would recommend organizations that promote education, science, and climate change research. A good example here is The Planetary Society, which advocates for science and technology – specifically space. It was founded by the late, great Carl Sagan and is currently lead by Bill Nye (yes, the science guy.) Education and tolerance is a big reason why this election turned out the way it did and in order to fix that we need to increase the education of our youth. Another great way to support organizations is to buy from Amazon Smile. What this program does is you select a 503c non-profit organization and whenever you want to buy something from Amazon, go to https://smile.amazon.com instead. Then, when you purchase eligible products (anything that’s Amazon Prime eligible) they donate 0.5% of your entire order to the charity you selected. 0.5% isn’t a large amount, no, at most you’ll be donating a few cents per purchase, but when you consider volume this can turn into a large amount.

Taking Action

So you want to take action and force change? Great! So do I. Here are some things you can do. Remember that none of my ideas are revolutionary. We can fix this, we just need to be calculated and smart about how to fix this.

Mid-Term Elections

2018 is a big year for mid-term elections. We have every representative and several senators up for re-election. Want to send a message to Washington? Tired of the same thing and roadblocks in Congress? Wish they’d have term limits? Time to prove that they do: vote!

“I would say we have term limits now — they’re called elections.”
— Senate Majority Leader Mitch McConnell

Most people vote along party lines. It’s extremely rare to have an incumbent not be re-elected to another term, when they run. So, since we don’t have term limits (sorry Mitch, elections aren’t term limits) and incumbents are almost always re-elected, it’s time to stop voting in the incumbents. Getting fresh people in Congress will be a big step to changing the system. They all need to go. Many of these politicians have held their office for at least a decade.

Educate Yourself

Ignorance and misinformation are the power against the proletariat. Fake news sites go viral on Facebook dramatically more often than the cold hard facts. As sad as it is to say, many people consider Facebook to be their primary news source. Fact check everything! Call out elected officials every time they lie! As painful as it might be to ask this: follow Donald Trump and Mike Pence on Twitter. Why? Because shocking things are said and we need to make sure we record all of these as evidence.

Get Political (Locally)

Many are considering going after Congress and the President based on this election. If you want to go straight to the top, go for it, but it’s probably misguided. You are very unlikely to actually cause change. Likely your letters and calls, while with well-intent, will fall to deaf ears. You need to start local. In Chicago, start with your local Alderman. Get active in the local politics first. Enact change with your city officials and mayor. Next, go to the state level. Elect the correct people to state congress and governor. Remember again that incumbents must go! We’re trying to enact change. Only after we change the local and state level can we start to affect the federal level.

Does this sound like it’s going to take years to do? You’d be correct: but we also have four years (minimum) before Trump is out of office, so we have the time.

I also want to stress to continue doing everything you are already doing. Protest (peacefully), sign petitions, and continue to pressure your elected officials by phone calls and letters and in-person visits. Educate your friends and get active in elections in 2018 and 2020. We need to lay a solid foundation to make real change in two and four years and more years to come. It seems insurmountable now, but stay diligent and keep at it and we can all get through these hard times.

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Redirection and Long Overdue Updates

The last post in this blog was almost 18 months ago. I never really said I’d be very dedicated to it but I figured I’d update this more often than that. Anyhow, for the infrequent visitor to this blog you may remember a very dark, sloppy, ugly, and outdated design. Old design be gone to this fancy new look and feel. Why, you might be asking, is a web developer with nearly a decade of experience who is very passionate about front-end development and architecture using a template on a WordPress blog? You might be asking why is a web developer even using WordPress? You might just be asking yourself how you found this blog. Well, the simple answer (to the first two questions) is because I’m very busy with work, hobbies, and side projects and just don’t have the desire or time to create a customized WordPress theme for myself. I’ll add that WordPress has always been the gold standard of WYSIWYG editors around and why should I reinvent the wheel for what I’m using this for?

What’s changed? Well, a lot actually. I work at a new company and am in a new role. Still a developer but focused only on front-end development and front-end architecture. Side projects are still written in PHP and I still do all the front- and back-end development on those. I now have two cats: Benjamin and Vesta. I ride my bike for thousands of miles a year. Traveled to some cool places: Yosemite, St. Louis, Philadelphia, Denver, and Austin just to name a few.  Still crazy about science and space. Still loving drinking great beers.

What’s coming up for this blog? Well, don’t expect really frequent updates. But do expect more occasional updates. There will still be random posts like this, maybe some cat photos, but also expect more cool posts.  About what? Well, I want to write posts about science and space, the occasional political rant, things about the state of cycling in Chicago, and brewing experiments and the like. But I also want to give back some, which is why I’ll also be sharing information about awesome web technologies like npm and Node.js. This is just the start of something I hope will be kinda cool but not all that time consuming.

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