Compounding Knowledge

My investing career started back in 2014. I walked into a broker’s office, asked for Peter, and told him I wanted to start investing. I transferred some money to him, he put it in a mutual fund and that was it. I didn’t even know what a mutual fund was. Peter gave me some papers about the fund and the meeting was over. I never saw Peter again.

Now, Peter didn’t run off with my money or anything like that, I just never saw him again. We did business over the phone. The mutual fund was invested in small-cap companies. One of the companies was Rosetta Stone. That was the only name that stood out to me. I remember Peter asked me “What is your goal for this money? ” and I told him “I want to have $100,000 in 10 years.” He took out a calculator, ran some numbers, and then said, “For you to reach that you will need to invest X amount of money each year with an annual return of X.” I said to myself, “That sounds awesome!” and then I said, “I need to find a job.”

At the time I didn't know a whole lot about investing. I gave Peter my money and didn’t contact him again for a couple of years. I remember logging into my account online to see how I was performing and I didn’t even know if I was up or down in my investment. This is how clueless I was. There was so much to look at that it was overwhelming. I had the mindset that it was too complicated to learn. When do you buy or sell? What's the difference between an exchange-traded fund (ETF) and a mutual fund? How do I get a dividend? What's a dividend exactly?

So, I went to a professional because that seemed like the logical thing to do. "How could I know how to manage my own money?" I think these thoughts are common amongst most people. So we go to the professionals and do what they say, but do we have to?

Over the past few years, I’ve developed an interest in personal finance and investing. It started in 2018 when I saw the interest grow in my savings account each month. I would receive more and more and I didn't have to do anything but keep money in the account. What a wonderful thing. This led me to read about compound interest, which led to individual stocks, then to capital gains tax, and so on. My financial knowledge grew a little bit each day. I read financial blogs and subreddits, listened to podcasts, watched CNBC. All of these outlets shaped my learning.

I eventually closed my account with Peter and opened a taxable brokerage account with a different company. I then opened several retirement accounts such as a Roth IRA, HSA, and a 457b. My work offers the latter two in addition to a pension plan. With all these accounts, I only manage two. The taxable and the Roth. For the other three, I contribute to them each month from my paychecks.

Do I still own that mutual fund with Rosetta Stone? No. I sold that as soon as I opened up my new taxable account. I now own a handful of stocks and ETFs that are spread out across the different investment accounts. No, I’m not YOLOing my life savings on Gamestop or any other meme stocks. I have done some trading in the past* but no longer do so.

In the span of a few years, I learned how to become more financially literate. I manage all of my investments, create monthly budgets, and have zero debt. While I was once intimated by the thought of investing and managing my money, today I've never felt more confident about my finances.

*Spring of 2020, at the start of the coronavirus, I traded a lot of stocks. It was my first time doing it and it was exhilarating. Buy X amount of shares in ABC stock and sell it later during the day. It’s not a good way to accumulate wealth but it was a fun way to spend an afternoon during the pandemic. I did this for a few months and eventually stopped. Trading is too difficult and this was also around the time when I learned about capital gains tax. “Wait. I have to pay taxes on all these gains?”

Skipping The Commute

A few years ago I was commuting from Lafayette, LA to Baton Rouge, LA four days a week for work. (I had Fridays off) This was driving on I-10. I did this for about seven months and it was awful. Driving on the interstate was fine usually if there were no wrecks or bad weather. It’s when you exit I-10 and drive into Lafayette city traffic. That is a nightmare. It would take me about 20 or 30 minutes to get from the interstate to my apartment. In the mornings it would take me 10 minutes because I would leave my apartment so early.

According to the U.S. Census Bureau, in 2019, the average one-way commute in the United States was just over 27 minutes or 54 minutes a day roundtrip. That’s 4.5 hours a week sitting in your car. Think about all the other things you could be doing with your time. I wanted to see how much time/money I was spending on this commute. Below is a breakdown.

  1. Time - I’d leave my apartment around 6:00 a.m. Leave work around 4 p.m.

    1 hour each way

    2 hours a day

    8 hours a week

    32 hours a month

    7 months - 224 hours or 9.3 days

  2. Cost - I would fill up my car once a week. I had a Prius so the cost was not too extreme.

    $25 a week

    $100 a month

    7 months - $700

  3. Miles - From my apartment to my work:

    60 miles one way

    120 miles a day

    480 miles a week

    1,920 miles a month

    7 months - 13,440 miles

  4. Stress - I believe I am a good driver. Most people think they are good drivers. But even though I feel comfortable behind the wheel it is still stressful. Some cars are traveling 20mph over the speed limit. 18 wheelers are passing each other. On my route, there are two bridges known for a variety of issues due to wrecks or bad weather.

I no longer commute. I moved to Baton Rouge. My commute now consists of me walking to work which is 12 minutes. (.5 mile) A month after moving, I sold my car to CarMax for $5K. It had just over 120,000 miles. I didn’t have any major issues with it. I simply didn’t need two vehicles. My wife also has a car and we use that one. I hardly use the vehicle. My work is down the street. My gym is closer than my work. The grocery is closer than my gym.

Now I save money on gas, maintenance, insurance, registration, I help out the environment, and I have a stress free commute. I understand most people can not or do not want to live near their work. I live in a city where it is possible for me. After walking to work for nearly two years, I hope I never have to commute to work in a car again.

Sold Prius to CarMax

I'm A Turkish Van Cat Owner

We have a Turkish Van in our apartment. MOZART. He’s a big guy. 13lbs or so. He’s been with us for four years. A guy was getting rid of him on Facebook and we took him in. While there have been some ups and downs living with him, overall it has been great. Here’s why he’s a good bud and why he’s a lil devil:

  1. Follower - One of my favorite things about him is he loves to be around us. He follows us from room to room. If I’m in the kitchen then he sits on a chair at the table. If I’m in the bathroom he sits on the floor or on the toilet seat. Turkish Vans are known to follow their owners wherever they go.

  2. Shed - He sheds a lot. There is hair everywhere in the apartment. I often find strands in my food. I’ll remove them but I wonder how many strands of hair am I not finding.

  3. Food Bowl - He scratches the ground around his food to mark his territory. He does this daily. Sometimes he even scratches at the wall by the food. This website explains why cats do this.

  4. Plants - My wife loves to have plants and flowers all over the apartment. The bad thing is the cat likes to eat them. We can not leave flowers or plants on the table because he will destroy them. We hang our basil in the window and have shelves on the wall to hold plants.

  5. Bear - When we return home from work or school we always find this teddy bear in different spots around the apartment. The bear belongs on the bed once it’s made. But for some reason, our cat takes him off and drags him throughout the apartment.

  6. Water - He loves water. No joke. Every time my wife takes a bath, he sits on the edge of the tub and lets his tail hang into the water. His coat is water-resistant. I’ll drop water on him and he doesn’t feel it. It slides onto the floor.

  7. Travel - If we decide to have a weekend getaway then we have to figure out what we will do with him. We can’t put food and water in his bowls and expect him to have a good weekend. He would destroy the apartment. One time he turned on the faucet in the bathroom and water-filled up the sink and overflowed onto the ground. That was a mess. Another time he chewed the wire behind the fridge to the ice maker and water leaked all over the kitchen. Another mess. Turkish Vans really do like water.

  8. Lap Cat - You can’t pick him up and hold him. No way. He will leave. He only sits on your lap or near you when he wants. At night he sleeps at the end of our bed. In the morning you can find him sleeping on your chest, neck, or sitting on the side of your head. Sometimes he sits on my back when I’m sleeping on my stomach.

  9. Knock Knock - He knocks over items throughout the apartment. We often wake up to find random tchotchkes on the ground. You can put a pen on a table and he will sit by it and then slowly push it off.

  10. Blankets - We have blankets on parts of our furniture so he doesn’t claw up the sides. I run after him or yell so he stops. That often does the trick but it doesn’t teach him a lesson. My mom says to smack him with a newspaper but he’s pretty quick.

These are the ups and downs of having a cat.

Turkish Van cat