Peter's Digital Garden

I’m not a financial advisor, but these are the rules I follow. This has savings advice, the other has investment advice.

• KISS. Keep it simple & safe.
  • Choose a bank and have one checking account that will skip the monthly service fee if you direct deposit your paycheck.
  • Have one credit card at that same bank that will skip the monthly service fee if you use the card each month. Ignore the APR, you shouldn’t leave a balance on the card. You are better off asking your existing credit card for a higher balance than getting a new credit card.
• Autopay everything. Your credit score goes up as you make regular payments.
  • Your paycheck should automatically deposit to your checking account.
  • Your checking account should autopay the balance of your credit card each month.
  • Same for your other expenses like rent, power, water, auto insurance, …
• Avoid debt traps. Never use a payday loan or leave a balance on a credit card.
  • The only debts you should have are fixed rate loans issued by a bank because it will only lend money it thinks you can repay. Most auto loans are actually through banks.
  • Unless a “payment plan” system is interest free, then don’t bother. Either pay the amount up front, or get a loan through a bank.
• Accept gifts.
  • If you have the option for a 401k, take it! Especially if the employer offers any kind of matching. Allocate at least enough to take advantage of any matching your employer offers.
  • If your company offers a share purchase plan with matching, take advantage of it! That is matching money the company is giving you. Depending on the “vestment” period, you can sell those stocks off later.
  • If you get a deal that waives fees for the first year, great. Just make sure you can afford the fees once that trial period is over. Because each time you start or cancel an account, that impacts your credit rating.
• Don’t gamble with your savings.
  • Gambling is not investing, any money you use for gambling is actually paying for entertainment. If you manage to get any money out, great, that is a bonus.
  • I also consider cryptocurrencies (Bitcoin, Dodgecoin), foreign currencies, commodities (gold, silver), collectables (baseball cards, old coins), and the stock market as gambling. Dealing with those deserves being a full time job.

Wait until you have enough in your checking account to cover 2 months worth of expenses, then flip the sheet and start thinking about investing.