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Why Everyone’s Talking ETFs (And You Should Too)
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In our latest InvestingFixx session, we dove into ETFs. Once a slow starter back when the first U.S. ETF was launched in 1993, they’re now a powerhouse of investing. ETFs have evolved from simple index trackers to versatile tools for generating income, building bond ladders and other investing strategies.
Today, there are over 12,000 ETFs globally with nearly $17 trillion in total assets, up from 4,300 ETFs with $3 trillion in 2015. Why the hype? Low costs, daily liquidity and access to practically any asset under the sun. While stocks and CDs still dominate as the planet’s most popular way to invest, ETFs are gaining fast, particularly when compared with mutual funds and index funds.
Could ETFs be a good fit for your portfolio? Join InvestingFixx and catch the replay – your first month is free!
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This Week In Your Wallet
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If you’ve ever hesitated to add guac at Chipotle because it costs extra, this new spending rule is for you. Nick Maggiulli, author, blogger and COO of Ritholtz Wealth Management, calls it the “0.01% rule.” The idea is that if your purchase is 0.01% or less of your net worth, don’t stress and just go for it. It’s based on a cautious assumption that your assets grow about 4% a year, or roughly 0.01% a day – meaning spending that small slice won’t hurt your wealth. For someone with a $500,000 net worth, that’s basically a $50 splurge. “It’s a sanity check on your spend,” Maggiulli tells The Wall Street Journal. Just don’t overdo it – he suggests using the rule only a few times a week.
Gen Z, hear us out. It might not be too early to start thinking about downsizing. As Investopedia reports, it’s not just about having fewer square feet – it’s about freeing up cash, reducing stress, and giving your future retirement self a confidence boost. The tricky part? Timing it right. Experts say there are scenarios when it can be a good move – when you become an empty nester, when you’re not experiencing a major life transition and when the market is in your favor. “In some metro areas, home prices remain strong while new construction lags,” notes Investopedia. “That inventory shortage can make it a good time to sell at a premium.”
Money can cause stress in any marriage, but when one partner comes from a different financial background than the other, things can be especially tricky. On HerMoney.com, Sage Singleton shares her story (plus three key tips!) for creating financial harmony as a couple. First up? Learning how to shop together. Sage recalls her husband’s shock when she reached for a pint of Häagen-Dazs on their first grocery run. “We’ve had to learn to compromise on which products we buy. If it’s something that can be purchased generic, we’ll do that to be more frugal,” writes Singleton. ‘If it’s an item where brand names matter, we purchase that. We are constantly learning how to shop and spend money together.”
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Things That Save You Money
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Sure, not working is relaxing…but what about making money in retirement by doing what you love? Check out these five retirees who turned their hobbies into money makers – like one whose love of animals inspired a booming pet products business.
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Love spooky season? Here’s your sign to start a porch decorating business. Busy people are paying big bucks to "pumpkin concierges" who deliver and artfully arrange pumpkins, gourds and other fall decor.
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One person’s trash is another person’s payday. This woman goes “fancy garbage picking,” scooping up discarded treasures from upscale neighborhoods to resell – and yes, she keeps a few gems for herself too. Gotta give her props.
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Blazers, Glasses And Gratitude: Julia Boorstin’s Rise
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Careers have a funny way of surprising us. Just ask Julia Boorstin. What started as a short stint in business journalism turned into 19 years as CNBC’s Senior Media and Tech Correspondent, covering giants like YouTube, Netflix and Google, while spotlighting women changing the game in business.
Boorstin joined Fortune magazine with zero economics classes under her belt. “Because I was so insecure that I hadn’t studied this, I did all the reading I possibly could to sort of catch up,” she tells Karen Finerman on How She Does It. Her secret weapons? Over-preparing and rocking glasses and blazers that screamed, “I know my stuff.”
Her first TV gig on CNN was unexpected, but she quickly became a regular guest, eventually landing a full-time, on-air role at CNBC. Throughout her career, and writing her book, “When Women Lead,” she found one surprising trait among top women leaders – gratitude. “There was about a two-week period where I did maybe a dozen interviews, and so many of the women talked about feeling grateful for setbacks and traumatic experiences that had reshaped their leadership approach,” Boorstin shares.
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Ask Jean
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I'm considering adding my 24-year-old grandson as an authorized user on my credit card to help him build credit history. I do not plan to give him access to a credit card. If he messes up his credit at some point, will it affect my score?
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Short answer? No. Anything your grandson does in the future will not affect your credit score, since your score is based only on your own accounts.
That said, it’s your grandson who could be at risk. “If the credit card he’s added to as an authorized user falls into trouble, for example, if balances run too high or payments are missed, that negative activity would appear on both your credit report and his,” says Michael Lofley, a CFP with HBKS® Wealth Advisors. “In other words, the real credit risk in this arrangement falls primarily on your grandson.”
A potentially better option? Consider a “secured credit card.” “This acts as a line of credit based on an amount on deposit in a bank account, usually a few hundred dollars to start, which a grandparent could provide,” says Michael Pumphrey, a CFP with Tanglewood Total Wealth Management. “This allows the grandson to learn how to use credit wisely, but with the guardrail that they won't go over the amount they have saved.”
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Submit your questions to Jean here.
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More For You To ♥
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🥇 Going for the gold? You’re not alone. Prices are soaring and investors are jumping in. If you’re ready to get your shine on, here are some options.
💝 Finding the right financial advisor is kind of like dating. You want the right match before committing long-term. Our pals at Wealthramp make it easy, pairing you with highly-qualified, fee-only advisors who fit your style, goals and budget.
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