Frequently Asked Questions (FAQ)

I’ve been getting a lot of the same questions regarding this site and my finances, so hopefully this helps clear up the confusion:

Why do you have so much cash?
We are saving up for a large house downpayment. While other investments like stocks and bonds may offer better long-term returns, they also carry more volatility. Given our time horizon of less than 2 years, we want to keep it safe while maximizing returns. Thus the focus on things like online savings accounts. Please also see the next question for the other reason why I have so much cash.

Why don’t you use your cash to pay down your credit card debt?
My large credit card debt is all at 0% APR interest. Please see my posts on taking advantage of no fee 0% APR balance transfers for more information. In short, I’m borrowing the money for “free” and keeping it in safe investments while earning me interest. I’m actually waiting on acquiring even more debt from two recent credit card applications.

Why don’t you focus more on investing?
Mostly becaause my retirement assets are on auto-pilot, so to speak. I have invested in low-cost index funds with my decided asset allocation, and I just let it grow automatically. I’m not 100% against stock-picking, but I think if you’re going to do stock-picking you really need to get your hands dirty and get into the numbers. I do want to learn more, though, and will write about it when I do.

I have $XXX. Where should I invest my money?
I’m sorry, I really don’t know, my own decisions are based on my own research as chronicled right here for all to see. While I would like to help, I don’t know your exact situation, nor do I have the training to help you properly. Please look through the Investing, Book Reviews, and Retirement sections of my blog for the resources that I used.

I have a new blog. The URL is http://www.$$$.com. Please link to me?
I love reading new stuff. I would be happy to take a look at yours when I get a chance. I do look for a record of regular posting (say once a week at least) and at least 10 posts so that I can check out your writing. So if your site is brand new, it may be a while. I’m also apt to lose your e-mail into the 200mb mass that is my Inbox, so a polite reminder in a couple weeks would be nice.

Comments

  1. Although I do not get 0% cards on purpose, I believe in building investments and payind debt at the SAME TIME. Yes, it takes longer, and many argue it may cost more.
    But if it takes you 5 years to pay your debt, and you end up with no cash, no investments, it could be very discouraging. It is better to have built up a good set of dividend or interest producing instruments that after a period of time paying debt AND investing at the same time, produces money! Month to month! (or quarter to quarter).

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