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7 Financial Choices That Seem Safe Until They Aren’t

January 24, 2026 by Brandon Marcus Leave a Comment

Image source: shutterstock.com

Money mistakes aren’t always the dramatic kind that make headlines. Sometimes, they lurk in plain sight, dressed in the reassuring clothes of “safe decisions.” You think you’re doing everything right—saving diligently, investing carefully, avoiding debt—but a few seemingly innocent choices can actually sabotage your finances without you noticing.

Imagine getting a little shock years down the line because a decision you trusted turns out to have hidden pitfalls. That’s the territory we’re entering today. Let’s pull back the curtain on seven financial moves that might feel harmless or even smart, but are actually ticking time bombs for your wallet.

1. Keeping Cash Under Your Mattress Or In A Checking Account

It sounds crazy, but some people genuinely feel safer holding on to physical cash or keeping all their money in a standard checking account. The problem is, inflation is quietly eroding the purchasing power of that cash every single year. What looked like $10,000 last year might not buy nearly as much today, and that gap widens over time.

Checking accounts also usually pay near-zero interest, meaning your money isn’t working for you at all. There’s no compounding growth, no opportunity to harness investments, and your funds are essentially stagnating. Sure, it’s “safe” from the stock market’s ups and downs, but that safety is deceptive because it doesn’t protect against the invisible thief of inflation. Meanwhile, investing even a portion wisely could have you building real long-term wealth instead of just watching numbers sit still.

2. Relying Only On Employer Retirement Plans

Many people lean heavily on their 401(k) or pension plan and assume that’s enough. Employer plans are great, but they aren’t one-size-fits-all, and they often lack the flexibility needed for changing circumstances. Contribution limits, investment options, and fees can all quietly chip away at your growth potential. Some employees even overestimate how much they’ll need at retirement because they assume their employer will fully cover future inflation or healthcare costs.

If you ignore outside opportunities like IRAs, Roth accounts, or other investment vehicles, you could be leaving significant money on the table. Diversifying your retirement strategy can provide a much safer cushion against market fluctuations and unexpected life events. In short, assuming your employer’s plan is a silver bullet is a surprisingly risky choice.

3. Paying Only The Minimum On Credit Cards

The minimum payment trick seems like a stress-free solution. You only pay what’s required, your account stays current, and you avoid late fees. Sounds safe, right? The reality is far less comforting. High-interest rates compound quickly, and what seems like a manageable balance can balloon into a long-term debt trap. Years can pass, and you might still owe more than you initially borrowed, even while faithfully making those minimum payments.

This slow-motion financial drain is one of the sneakiest forms of “safe” behavior because it looks responsible on the surface. Paying a bit more than the minimum each month can save you tens of thousands in interest over time, creating freedom and peace of mind.

Image source: shutterstock.com

4. Buying “Too Safe” Investments

Certificates of deposit, government bonds, and ultra-conservative mutual funds are often praised as safe bets. While low-risk assets protect your principal, they can also fail to keep up with inflation. Your money might technically be safe, but if it doesn’t grow, your future purchasing power shrinks. Investors sometimes focus so much on avoiding risk that they miss opportunities for modest growth that outpaces inflation.

This is especially important for younger investors who have decades to recover from market dips. The key is balance: a mix of secure and growth-oriented investments can provide both safety and real progress toward financial goals.

5. Co-Signing Loans For Friends Or Family

Helping someone out financially feels noble, but co-signing a loan is one of those decisions that can backfire spectacularly. If the primary borrower misses a payment or defaults, you are legally responsible for the debt. This can impact your credit score, limit your ability to get loans, and even lead to collections actions against you. It’s tempting to trust loved ones, but emotions don’t cancel out financial responsibility.

Understanding the potential consequences fully before putting your signature on the dotted line is critical. Sometimes saying no is actually the safest and kindest choice—for both parties.

6. Ignoring Insurance Or Having The Wrong Coverage

Insurance is boring until you need it. Many people skip coverage thinking it’s an unnecessary expense, or they pick the cheapest plan and assume it’s adequate. The truth is, underinsurance or no insurance can devastate your finances in an instant. Medical emergencies, natural disasters, or liability claims can wipe out savings faster than you can react.

Comprehensive coverage might cost a little more upfront but can save you from catastrophic losses down the line. Regularly reviewing and updating your policies ensures your safety net is both current and sufficient.

7. Overestimating Passive Income Streams

The promise of passive income is seductive—earn money while you sleep, they say—but it’s rarely as simple as it sounds. Rental properties, online businesses, or dividend stocks all require ongoing attention and carry risks that aren’t immediately obvious. Market shifts, tenant vacancies, or regulatory changes can quickly erode the expected income.

People often treat passive income as guaranteed when in reality it’s more like semi-passive; it demands effort, monitoring, and sometimes unexpected financial input. Overreliance on assumed income streams can leave you exposed when reality doesn’t match expectations.

What Decisions Will You Make?

Financial decisions that seem safe can sometimes be the riskiest ones of all. Awareness, research, and a willingness to adapt are your best tools for avoiding long-term pitfalls.

What financial choices have you made that turned out differently than you expected? Or have you spotted “safe” moves that really weren’t?

8 Things You Should Never, Ever Put in a Bank Safe Deposit Box

December 3, 2025 by Brandon Marcus Leave a Comment

Image Source: Shutterstock.com

There is something mysteriously thrilling about sliding open a safe deposit box—like you’re about to stash away royal jewels or the secret formula to your grandmother’s unstoppable banana bread. But despite the Hollywood-level glamour, safe deposit boxes come with rules and risks that most people never think about. Banks provide a sturdy steel vault and a little private room to sort through your treasures, but that doesn’t mean everything belongs inside one of those metal drawers.

In fact, some items are absolutely terrible candidates for safe deposit storage, no matter how “important” they may seem. Before you lock something away for safekeeping, it’s worth knowing what could lead to chaos later.

1. Original Copies Of Estate Planning Documents

Many people assume that a safe deposit box is the perfect place for their will or power of attorney, but this creates a major headache when someone actually needs those documents. Banks often restrict access if the owner has died or is incapacitated, and that means your loved ones will have to navigate a maze of legal hurdles just to get inside the box. This can delay urgent tasks and, in some cases, cause serious financial or medical complications. Estate documents should be accessible instantly, not locked behind layers of bureaucracy. Keeping them at home in a fireproof safe or with your attorney is a far smarter plan.

2. Items You Might Need During An Emergency

Safe deposit boxes are not designed for quick access, and you can’t just waltz into the bank at midnight or during a long holiday weekend. Storing passports, medical directives, or emergency cash inside the vault means you might be stuck without them at the worst possible time. Imagine needing to catch an urgent international flight or provide life-saving medical documents, only to discover the bank is closed for three days. When timing matters, a safe deposit box becomes a frustrating obstacle instead of a solution. Anything required in a crisis should stay close, not locked in a banker’s basement.

3. Firearms Or Anything That Could Trigger Legal Trouble

Banks do not want weapons in their vaults, and neither should you. Safe deposit boxes are not designed to store firearms safely, legally, or securely from misuse. If a weapon is found during a box drill, or if law enforcement ever needs access, the situation becomes complicated in ways you definitely don’t want to experience. Many states also have laws restricting firearm placement in third-party storage outside your control. When it comes to weapons, proper home storage or a licensed facility is always the better choice.

4. Cash You Expect To Use Or Access Quickly

Contrary to what movies suggest, hiding stacks of cash in a safe deposit box is wildly impractical. Banks don’t insure cash held in boxes, and if the vault is damaged, flooded, or broken into, you could lose every dollar with no protection. Plus, if you need that money quickly, you’re stuck waiting for business hours—and that’s not ideal in emergencies or during unexpected opportunities. Cash should either be in a bank account or somewhere secure and accessible at home. Keeping it buried behind steel doors just slows you down and increases risk.

5. Anything Illegal, Questionable, Or Hard To Explain

Safe deposit boxes aren’t magical, no-questions-asked hiding spots, even though they’re often portrayed that way. Banks have policies that allow them to intervene if they suspect illegal activity, and law enforcement can gain access with the right warrants. If you wouldn’t feel comfortable explaining an item to a bank manager or police officer, it probably shouldn’t be in a vault to begin with. Storing questionable items can escalate a routine situation into a legal nightmare. A box meant for valuables should never become a hiding place for trouble.

Image Source: Shutterstock.com

6. Uninsured Or Irreplaceable Heirlooms

While safe deposit boxes are secure, they are not invincible, and many people are shocked to learn that banks do not automatically insure the contents. Floods, fires, theft, or mishandling can—and sometimes do—damage what’s inside. If you’re putting an irreplaceable piece of family history in the box, understand that getting compensation for damage is extremely difficult. Some items are simply too precious to risk locking away with no guarantee of protection. A home safe with proper insurance often provides a better blend of access and security.

7. Spare Keys, Car Titles, And Essential Daily Items

It might sound logical to keep a spare house key or your car title someplace extra secure, but doing so can trap you in maddening situations. If you lose your primary keys and the spares are locked in the bank, you’re stuck waiting until business hours—not ideal if you’re stranded outside at night. Similarly, losing your original car title means you can’t prove ownership without a lengthy retrieval process. Everyday essentials should be kept accessible and easy to retrieve when life inevitably throws something unexpected at you. Convenience matters just as much as security.

8. Digital Devices Or Hard Drives With Critical Information

Putting a laptop, phone, or external hard drive in a safe deposit box might seem like a clever way to protect sensitive data, but it introduces serious problems. Electronics can degrade in storage, especially in environments not optimized for temperature or humidity control. More importantly, if you forget a password, need urgent work files, or require access to two-factor authentication apps, you’ll be locked out until the bank opens. In a world where digital access is everything, storing crucial tech behind bank hours is a recipe for frustration. Keep digital backups secure but reachable, not locked behind a schedule.

Be Smart About What You Lock Away

Safe deposit boxes can be incredibly useful, but only if you understand what belongs inside—and what definitely doesn’t. Some items become less safe when stored behind restricted access, and others lose protection entirely when placed in an uninsured vault. Knowing what to avoid can save you stress, money, and time when life throws you a curveball. So be thoughtful about what you store, and make sure it supports your real-life needs rather than complicating them.

Have you ever made a safe deposit box mistake? Give us your stories, surprises, or lessons learned in the comments.

Could Retirement Savings Be Safer in Cash Than in Stocks

September 6, 2025 by Travis Campbell Leave a Comment

Image source: pexels.com

When planning for retirement, it’s natural to worry about how safe your nest egg really is. Stock market volatility can make even seasoned investors nervous, especially when headlines warn of market drops or looming recessions. Some people wonder if parking their retirement savings in cash—like a savings account or money market fund—might be a safer bet than keeping it in stocks. This is a big question with real implications for your future lifestyle and peace of mind. Let’s take a closer look at whether retirement savings could be safer in cash than in stocks, and what you should weigh before making a move.

1. Understanding the Risks of Stocks

Stocks have a reputation for delivering strong long-term returns, but they’re not without risk. The value of your investments can swing wildly in response to economic news, company performance, or even global events. For retirees or those close to retirement, a big drop in the market can be especially scary if you need to withdraw money soon.

Still, over decades, stocks have generally outpaced inflation and helped retirement savings grow. But the risk is real: if you need to sell during a downturn, you might lock in losses that take years to recover. This makes it tempting to ask if putting your retirement savings in cash might be safer, at least in the short run.

2. The Appeal and Limits of Cash

Keeping retirement savings in cash feels safe. Your money doesn’t lose value overnight, and you don’t have to worry about stock market crashes. Cash in FDIC-insured accounts is protected up to certain limits, so you won’t lose your principal if the bank fails.

However, the safety of cash comes with a catch. Interest rates on savings accounts and money market funds are usually low, especially compared to the historical returns of stocks. If inflation rises faster than your cash earns interest, your retirement savings could lose purchasing power over time. This hidden risk means your money might not stretch as far as you hoped during a long retirement.

3. Inflation: The Silent Threat to Retirement Savings

Inflation erodes the value of money slowly but steadily. If your retirement savings are mostly in cash, you may not notice the impact right away. But over 10, 20, or 30 years, inflation can significantly reduce what your savings can buy.

Stocks tend to offer some protection against inflation because companies can raise prices and grow profits over time. Cash, on the other hand, rarely keeps up. For many retirees, the risk of inflation eating away at their nest egg is just as real as the risk of a market downturn. Balancing these risks is key when deciding if your retirement savings could be safer in cash than in stocks.

4. Liquidity and Access to Funds

One advantage of keeping some retirement savings in cash is liquidity. You can access your money quickly for emergencies or big expenses, without worrying about selling stocks when the market is down. This flexibility can be comforting, especially if you have unexpected health costs or want to help family members.

However, holding too much cash can mean missing out on the growth you need to fund a long retirement. Most financial advisors recommend keeping enough cash to cover a year or two of living expenses, with the rest invested for growth. This way, you get the best of both worlds: safety and flexibility from cash, and the long-term growth potential of stocks.

5. Balancing Your Retirement Portfolio

It’s rarely an all-or-nothing choice between cash and stocks. Most retirement plans use a mix of assets, including stocks, bonds, and cash, to balance risk and reward. As you get closer to retirement, it often makes sense to shift more money to safer investments, but not necessarily to cash alone.

You might consider using a “bucket strategy,” where you keep short-term spending money in cash, medium-term needs in bonds, and long-term growth in stocks. This approach can help you weather market ups and downs without sacrificing too much growth.

What to Consider Before Making a Move

The question “Could retirement savings be safer in cash than in stocks?” doesn’t have a one-size-fits-all answer. It depends on your age, risk tolerance, spending needs, and how long you expect your money to last. Some cash is important for short-term stability, but too much can hurt your long-term security.

Before shifting your retirement savings, think about your timeline and future needs. Are you worried about short-term losses, or are you more concerned about running out of money later? A thoughtful mix of cash and stocks is usually the safest approach for most retirees.

How are you balancing cash and stocks in your retirement savings? Share your approach and any questions in the comments below!

What to Read Next…

Travis Campbell

Travis Campbell is a digital marketer/developer with over 10 years of experience and a writer for over 6 years. He holds a degree in E-commerce and likes to share life advice he’s learned over the years. Travis loves spending time on the golf course or at the gym when he’s not working.

10 Hot Items Thieves Are Looking To Steal From Your Car!!

April 3, 2024 by Tamila McDonald Leave a Comment

Car Thieves

With the rise in vehicle break-ins, understanding what thieves are targeting is crucial for protecting your belongings. Here’s a list of ten items commonly stolen from cars, highlighting the importance of being vigilant and taking preventive steps to safeguard your possessions.

1. Fitness Trackers and Smart Watches

Smart Watches and Fitness Trackers

Fitness trackers and smart watches have become increasingly popular and are often left in cars after a workout or during a quick errand. These high-tech gadgets are not only valuable but also easy to sell, making them a prime target for thieves. To prevent theft, it’s best to keep these devices on you or hidden from view when left in the car.

2. Sporting Equipment

Sports Equipment

Sporting equipment, like golf clubs, bicycles, and ski gear, are prime targets due to their high value and ease of resale. Leaving these items visible in your car can quickly attract thieves. It’s advisable to store such equipment in the trunk or bring it inside to ensure its safety.

3. High-End Clothing and Shoes

High End Clothing and Shoes

Luxury clothing and designer shoes can be significant lures for thieves. These items, especially if left in shopping bags or in plain sight, can suggest the presence of other valuables. To protect them, it’s best to keep such items concealed or take them with you when leaving the car.

4. Car Seats and Baby Accessories

Baby Accessories

Car seats and related baby accessories like strollers and diaper bags are surprisingly attractive to thieves. They are not only costly to replace but also essential for parents. Keeping them inside or in a locked trunk is vital for safeguarding these items.

5. Cash

Cash

Cash is a universal motivator for thieves. It’s untraceable and immediately usable, making it an attractive target. To avoid making your car a target, refrain from leaving any cash, including small change, visible inside your vehicle.

6. Car Parts and Accessories

Car Accessories

High-end car parts, such as audio systems, rims, and custom accessories, are valuable and easy to sell on the black market. It’s essential to park in secure areas and consider additional security measures for your vehicle to prevent these thefts.

7. Work Equipment and Uniforms

Work Equipment

Industry-specific tools and equipment, as well as professional uniforms, are often targeted by thieves. They can indicate the presence of other valuable items and are themselves costly to replace. Secure these items in a locked compartment or take them with you to ensure their safety.

8. Personal Electronics (Tablets, Cameras)

Personal Electronics

Tablets, cameras, and other personal electronics are attractive to thieves for their high resale value. Their portable nature makes them particularly vulnerable when left in a vehicle. To protect these items, store them in a locked glove compartment or trunk, or better yet, keep them with you.

9. Shopping Bags and Visible Items

Shopping Bags and Visible Items

Any visible item, regardless of its actual value, can tempt a thief. Shopping bags, whether they contain new purchases or groceries, can attract unwanted attention. Store these bags in the trunk or take them with you to deter potential break-ins.

10. Gym Bags

Gym Bags

Gym bags are often targets for thieves, as they may contain electronics, jewelry, or cash. Leaving a gym bag in your car, especially in plain sight, can make your vehicle a target for theft. Keep your gym bag with you or store it out of sight to avoid attracting thieves.

Awareness Is Key

Conclusion

Awareness of what items are frequently stolen from cars is key to preventing these thefts. Always be cautious about what you leave in your vehicle and remember, the best deterrent is an empty car. By taking proactive steps to protect your belongings, you can significantly reduce the risk of becoming a victim of car theft. Stay informed, stay safe, and keep your car free of tempting items for peace of mind.

Tamila McDonald

Tamila McDonald is a U.S. Army veteran with 20 years of service, including five years as a military financial advisor. After retiring from the Army, she spent eight years as an AFCPE-certified personal financial advisor for wounded warriors and their families. Now she writes about personal finance and benefits programs for numerous financial websites.

How Much Cash Is Needed to Start a Pawnshop?

January 6, 2021 by Jacob Sensiba Leave a Comment

So you want to start a pawnshop. Where do you start? What do you buy? How much is this all going to cost?

A pawn shop can be a very cash-positive business. While doing research for this post, I stumbled onto a Quora thread that showcased how much money can be made with such an operation. The profits ranged from $30,000 per year to $60,000 per month.

But, you have to get started. In today’s post, we’ll highlight what you need and what it’s going to cost.

What do pawn shops do?

First off, we have to talk about what a pawnshop actually does. Pawnshops buy, sell, and trade items. These items can come from the owner’s personal collection, something they acquired via purchase, or something they acquired via loan collateral.

When someone comes to a pawn shop to borrow money, they have to bring something of value for collateral. When the pawnshop lends money to this individual, they retain that valuable item until the principal (plus interest) is repaid. If they fail to repay, the pawnshop keeps the item.

Legal and location

There are many things you need to obtain when you start a pawn shop.

You need to take care of the legal requirements first. This includes licenses, articles of incorporation for your business entity, and permits.

Licenses include a pawnbroker’s license, precious metal dealer license, secondhand dealer license, and Federal Firearms License (if you plan on selling firearms) from the ATF.

The next thing you need is space. Where you set up shop is an important decision. The right location can bring in a lot of traffic and improve your earning potential. However, the right location comes at a cost.

Areas with high foot traffic cost more. Often, pawnshops will choose a space that’s close to a popular area, far enough away that it’s not too expensive, but close enough to make it convenient for the consumer.

Assets

There’s a minimum asset requirement needed to open. That number depends on the municipality, state, and country you plan on setting up shop in. For example, Texas has a $150,000 minimum requirement.

What do you need?

After you have all of the proper licenses and permits and pick where you’ll operate, you need to buy things to be operational.

These items include a computer (computer system/network), cash register, signs, equipment to display your products, record keeping, insurance, lockable cases, and a state-of-the-art security system.

What you’ll also need is an adequate amount of capital to purchase more inventory and lend money to consumers.

What’s going to cost

Depending on the size of your pawnshop and the anticipated foot traffic, your start-up costs will vary. If you’re a larger shop with a high probability of having a lot of visitors/customers, your starting capital could be between $50,000 and $75,000. A smaller shop with lower projected traffic can get by with $15,000.

Last bit of advice

When you start a pawnshop, you need to refine and learn some new skills. You have to educate yourself on how to assess the value of goods so you can acquire sellable items, but not at a cost that eats into your profit margin.

Also, you have to come up with a business plan. What interest rate will you charge on your loans? How much will you mark up the items you sell? How much are you willing to pay for inventory?

All of these questions need answers. Keep in mind, that this planning process should take place prior to buying the necessary licenses and other items to get the business started.

How My Finances Have Changed with Covid

May 20, 2020 by Jacob Sensiba Leave a Comment

Aside from the death and illness, it has caused, Covid-19 has done a number on the financial system and the economy.

I’m writing this on May 19th, and up to this point, over 30 million people have filed for unemployment benefits.

In my previous post, which can be found here, I detailed how you can plan in the event of job loss.

Even if you haven’t lost your job, more than likely, your finances have changed. In this article, I want to pull back the curtain on how my finances have changed during this environment.

My Job

Thankfully, I’m still working. I work for my family’s business. Technically speaking, we have four family businesses and I work three out of the four in various capacities.

Two out of those three businesses are very resilient during recessions, so I’m not terribly worried about my income from those two sources.

The last, however, will be influenced by movements in the market. If I do my job well, it shouldn’t vary a ton, but if I don’t, my clients will feel the pain, as will I.

The reason being is I, typically, charge a percentage of the assets under management (AUM). If account values go down, so does the fee I receive. The two go hand in hand, as they should. If I do a poor job, I should make less. It just makes sense.

With that said, my income hasn’t moved too much from the financial advising gig. It dropped a little bit last month, but I imagine it’ll come back up by the end of May, as the market has recovered.

Opinion: The Economy

I don’t know if I’ve mentioned it yet here, but my opinion of the economy is darker than some. I think there will be a cascade of bankruptcies in the public and private sectors.

With regard to the public sector, the companies that are rated BBB are already at record highs. When revenues stop coming in or significantly reduce, it’s hard for companies to make interest payments to lenders (holders of debt).

Companies will start defaulting on their debts, and the ability to pay, as well as other factors, help determine the credit rating. This will cause a slew of BBB rated companies to get downgraded.

Funds

With regard to fixed income mutual funds and ETFs, the vast majority of them have rules they need to abide by. One of those rules could be only investing in investment-grade companies.

Investment grade is anything from AAA to BBB. My fear is that when companies get downgraded from BBB to BB, it’ll cause funds to dump those companies; exasperating the sell-off.

My Finances

With that said, here’s how I’ve adapted.

My finances really haven’t changed much. I’m spending more on groceries, especially right now as I am stocking up on certain goods. The added benefit of that is I’m spending less on food from restaurants, which saves me money and I’m eating healthier too.

So you’re spending more on groceries and less on take-out…what else? Well, given the nature of Covid and the uncertainty that surrounds it, my priorities have shifted a little.

More Cash

I’ve planned my clients’ portfolios with the above scenario in mind. The majority of clients aged 60 and up are positioned more conservatively than normal. With that in mind, all of the portfolios I manage will take a little hit, and my income will drop as a result.

I’ve suspended my retirement contributions, via payroll deduction, until I feel comfortable again. This may seem counterintuitive because of the stress I put on leaving things alone and dollar-cost-averaging as prices go lower.

Due to the fact that my income has some variability, not to mention my rental property and the uncertainty of my renters’ making rent payments (because of talks about forgiving rent payments for those affected by Covid), I have to keep more cash available than normal.

Retirement Contributions

As I mentioned, I stopped my automatic retirement contributions, but I am making voluntary contributions to my Roth IRA when I feel my cash available is adequate.

Other than that, nothing else has changed. Debt payments will continue as planned and saving for a down payment on a house will also continue.

Be advised: Any opinion expressed about the market/economy is strictly an opinion and should not be viewed as a certainty. Additionally, my preparations for said opinions are specific to me. Consult your financial professional about your particular situation.

How To Find Money Management Success – Create a Dashboard

May 17, 2015 by Joe Saul-Sehy Leave a Comment

I just answered a question on Facebook about a recent podcast interview featuring some bill pay app creators. My interviewees had discussed just how difficult it can be to quickly and efficiently pay bills. “I don’t understand the problem these guys are presenting,” the poster said (I’m paraphrasing….). “I just go to my bank and use their bill pay app every other week. No problem.”

I wish it were that easy for everyone.

Let’s face it. Most of us have one big problem with our financial profile: we’re disorganized. After 16 years in the financial trenches, I’ve seen it far too often to think it’s anything other than a widespread problem. Most of us pay bills on sixteen different sites and have two old 401k plans with former employers, our current job’s plan AND different 529 plans for each child. It’s impossible to manage everything. I’d ask people with all of these different investments and bill paying problems how they juggle everything, and the answer I most often heard was, “I manage it very poorly.”

Yet moving investments to a single provider is a scary proposition. We’ve all heard of Bernie Madoff and don’t want to trust one person with our money. We also have all heard of diversification. Having different plans ensures that I won’t have all of my eggs in one basket.
So we have two problems: safety and diversification….and the fact that by having your assets spread out it’s impossible to track. How do we reconcile these two ideas?

It’s easier than you think.

Could you drive a car with three different dashboards?

Think About Driving A Car

When you drive a car, do you have one set of gauges or several? Of course, you only have one set of gauges. It’d be impossible to drive if you had five different dashboards. Imagine! Yet, when you think about your car, it’s a diversified collection of inputs, all working independently. However, when you put it all together, these gauges make your car easier to drive. You get the right data at the appropriate time.
That’s what we’re looking for with money management success….we don’t want to get rid of diversification. Our goal is to create a single dashboard.

In Your Personal Life

There are three areas you should look at with your money:

– Budget and bill tracking. Budgets fail when you’re making decisions about spending without knowing where your money goes each month. Items like a mortgage or rent payment and grocery bills are easy to track, but how much do you spend each week on entertainment? If you don’t track your expenses, it’s difficult to project the future or find any money management success. The gauge you’re looking for to help with daily money management is an app like Mint or Yodlee, that will automatically track your expenses so when you’re planning next week’s expenses you know how you’ve spent money in the past.

For budgets, Mint will allow you to set up alerts so that you’re notified when going over budget categories. YNAB (paid subscription) will help you think differently about your budget and keeping every area in check. People who like the old-fashioned envelope system may be attracted to MVelopes, an automatic way of instituting envelope budgets so you don’t have cash sitting around your home.

– Investments. Many apps will help you track your investment life. In particular, Mint can create a pie chart of your overall diversification so you can easily make investment decisions. Companies like Jemstep allow investors to input their goals and then recommends investment shifts. FeeX will look at all of your investments across platforms and tell you how much you’re paying in fees….an important gauge to see when investing. Zillow has a cool app that will track any real estate properties you own. NVestly is a social media site that not only helps you see results across your whole portfolio, but also makes investing social (you can see others investment pies…but not the amounts of money they have in any investment). While each of these is different, using a couple of these apps can help you make better investment decisions without worrying about having too much money at a single brokerage account.

That said, brokerage houses all offer a diversified collection of investments through different companies. Just because your portfolio is housed as Fidelity, for example, doesn’t mean you have to have all Fidelity investments. They work with a wide range of providers….and you only have to visit one brokerage site to see everything. One dashboard but still diversification!

– Big Picture. You should be able to see how your net worth is growing at a glance. Mint and Yodlee, among others, will give you that quick at-a-glance overall picture.

With Your Business or Side Gig

If you’re self employed, you’re even more crunched for time. You have your personal books AND business metrics to track. As a fan of the excellent management book The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It, I know that the keys to business success are in systems and data. How much data you have and how quickly you can use that data to your advantage are important. That means three things:

– Platform. If your business or side-gig project isn’t build on a solid footing, you’re hurting. A web presence built by experts like 1and1.com means that you won’t have to worry about the “bones” of your business being difficult for customers or employees to navigate.

– Reporting. Using your bank’s application to track inflows and outflows (as well as setting up a Mint or Yodlee account for your business) can help you stay on top of business expenditures and inflows. Ask your accountant about great business tracking apps and software that they recommend.

Overall

Staying diversified doesn’t mean having money scattered all over. By focusing on systems, building a dashboard, and reliable business help, you’ll find that you’re able to more quickly make financial decisions that move the needle. That’s how you build long-term wealth!

Photo: Steve Jurvetson

Joe Saul-Sehy

Joe is a former financial advisor and media representative for American Express and Ameriprise. He was the “Money Man” at Detroit television WXYZ-TV, appearing twice weekly. He’s also appeared in Bride, Best Life, and Child magazines, the Los Angeles Times, Chicago Sun-Times, Detroit News and Baltimore Sun newspapers and numerous other media outlets. Joe holds B.A Degrees from The Citadel and Michigan State University.

joesaulsehy.com/