Are You Wasting Hundreds a Year on Car Insurance?

While combing through a friend’s finances with him in search of savings opportunities recently, we struck gold with his car insurance. He is going to save hundreds of dollars over the next year as a result of making one minor change and at this point in his life, that will go a long way for him. In the process, I realized that car insurance is probably a large potential savings opportunity for a lot of people and I was inspired to write a post on the basics. Please note that I am no insurance expert and none of this, or anything in any other post for that matter, is intended as legal advice. But I do know a fair bit and I may be able to help point you in a direction that will save you some cash.

The first thing I tell anyone about insurance in general is that in many cases, loyalty counts for nothing. In my experience, the only reward for staying with a company long term is a consistent premium increase. This doesn’t necessarily apply to all companies but it also doesn’t cost you anything to get a few quotes to make sure your existing company is still competitive. I recommend doing so every couple of years or so. Companies seem to make fairly regular changes to the way they rate drivers, vehicles, etc, and the only way to find out about them is to shop around and see who is offering you the best deal today. Don’t assume that anything will be consistent from person to person or even from year to year for the same person. Numerous variables go into what premium is charged. Some agents seem to be very willing to shop around for you as a new customer but very reluctant to do so when you are already on the books. This has to do with their business model. However, just as with almost any other service, if you are less valuable as an existing customer than you were as a new one, become a new one again – for someone else.

Another important thing to look at with car insurance is your coverage itself. Liability coverage is required in most states now and is required by common sense and basic human decency everywhere. Sometimes the legal minimums are lower but I recommend at least 100/300 for bodily injury and 100 for property damage – and 200/400/200 wouldn’t be overkill either. Remember, if you run out of insurance coverage, you’re on the hook from that point on. And things can get expensive very quickly whether you’re paying to repair cars or people so skimping on this to save a few bucks on premiums could be a very painful decision in the long run. Liability coverage also benefits you in the form of uninsured/underinsured motorist coverage. There are simply far too many irresponsible people out there and as usual, people who make one bad decision, such as not having car insurance, tend to make others as well. In my relatively young life, I’ve already been rear ended by not one, but two uninsured drivers while stopped behind lines of cars at stoplights. It doesn’t get any more “not at fault” than that. In both cases, I was very glad to be covered by my own insurance company even though the drivers who hit me hadn’t had the decency to get coverage of their own.

So where can you save money on coverage? In the physical damage section. For this part, you need to consider both the car you’re driving and your financial situation. First of all, if your car is worth less than $5000, you may want to consider passing on collision coverage altogether. Of course, this means if you are in an at fault accident, you have to pay to repair the damage to your car. But most accidents are minor ones that involve little more than replacing a bumper, which is usually around $1000. Plus, if your car is worth that little, chances are you’re not going to repair minor damage anyway. So by not having the collision coverage, you’re really betting that you either won’t get in an at fault accident or that if you do, it will be a minor one. I like those odds. That said, if you don’t have a reasonable emergency fund of at least $5000, you may want to think twice about this.

Please note that if there is a lien on your car (in other words, if you have yet to pay it off), you cannot do this because it will put your loan in default status. You probably don’t want a visit from the friendly repo man anytime soon – even if your lender is likely to call and threaten you for a while before they go to that extreme.

If you want to follow a more minor version of the no collision coverage strategy that doesn’t put an auto loan in default, you can raise the deductible. Going from $500 to $1000 usually makes a decent difference in the premium. I have never seen going higher than $1000 do much of anything so I leave it there. This should pretty well confirm what I said above about most accidents amounting to a $1000 bumper replacement; insurance companies literally bet on it with their pricing.

Aside from coverage changes, there are a few other more traditional methods of lowering your car insurance premium. You can pay for six months at a time or annually if your insurance company offers that option. This usually saves you a little and offers the bonuses of both a head start on any credit cards you may be churning and locking in the premium for the full term you’re paying for. For example, I will only do a full year here in Houston since premiums are rising very quickly as insurers work to recoup their Harvey related losses. You can also get a discount for getting your car insurance from the same company as your homeowners/renters policy. You can talk to your agent to make sure you’re getting all the discounts you may be eligible for (good student, membership in certain associations, completed safety classes, etc). In the case of many insurers, you can also get a discount for letting them use a gps to monitor your driving habits. However, as a safe driver, but one who also likes to get where I’m going in a timely fashion, I’m always going to pass on that offer.

This obviously isn’t exhaustive of every possibility but hopefully it will give you an idea or two to try out. Good luck and safe travels out there!

Credit Card Fun – A Couple of Recent Developments

Happy weekend to you! A while back, I wrote a post about exactly how I use credit cards to make an extra $2k a year of tax free income. If you haven’t read it already, I recommend doing so now because parts of this post are going to build on it. I have a couple of minor changes to tell you about that are going to make things just a little bit better. This is a great example of a procedure I engage in periodically – redoing my research to make sure I am still getting the best deals available in every area of life.

The Bank of America Cash card recently prompted me to do this when it introduced a small upgrade. Now, instead of paying 3% on gas purchases, it will pay 3% on your choice of a handful of categories – gas, dining, travel, and some others. You can even change your selection as often as once a month. So if you have a vacation coming up, for example, simply switch your selection and boom – you’re now getting 3% on travel! The card will still pay 2% on Costco purchases. Please note that I’m sticking with the format of my last post in only listing the optimal bullet points. For example, I didn’t mention the 1% this card offers on the “all other” purchases category since the Citi Double Cash card already pays 2% there. In my case, of the new options, I was leaning towards rotating between dining and travel depending on how much travel I had planned for any given month. However, the situation suddenly became more complicated – in a good way.

Since as part of this I wouldn’t be earning 3% on gas purchases anymore, I decided to do a quick check to find out if there are any current offers that beat my default 2% for gas. The first stop on this search was www.doctorofcredit.com. This is an excellent financial hacker type blog that does a far better and more thorough job of covering credit cards, in particular, than I’ve seen anyone else do. And today the good doctor had some good news for me; there is a newcomer on the scene that will put a little extra money in my pocket!

The Wells Fargo Propel card, which apparently came out last year, has two claims to fame. First off, it appears to offer the largest sign up bonus (30k points/$300) of any credit card available that doesn’t charge an annual fee. Second, it pays 3% on a nice range of categories – travel, gas, dining, and streaming services. This is an excellent no fee card and it’s going to have a place in my wallet as soon as the snail mail can get it to me.

But here is the rub. The Bank of America Cash card, which prompted me to redo my research in the first place, is suddenly looking irrelevant. For those following along at home, the Wells Fargo Propel card covers each of the most valuable Bank of America Cash categories – except that instead of paying 3% on one of them at a time, it does so on all of them. So is the Bank of America Cash card facing the cruel fate of offering an upgrade and being rewarded with a “do not pass go, do not collect $200” style trip through my shredder?

Not so fast. Bank of America offers a 10% bonus if you redeem your rewards into one of their checking or savings accounts. So for every $100 I earn on the Bank of America Cash card, I get $110 if I put it into the savings account I already use to maximize the rewards of my Bank of America Better Balance Rewards card. There is also the Bank of America Preferred Rewards program that could give you bigger bonuses than that. But I am strictly a low effort level hacker so I will have to refer you to www.doctorofcredit.com if you want to learn more about that angle. In any case, that 10% bonus, plus the 2% paid on Costco purchases (the Wells Fargo Propel card is an Amex and Costco only accepts Visa right now), means the Bank of America Cash card will narrowly avoid the shredder although now it will only be used for whatever category I’ve chosen to pay 3% in any given month.

Keen observers of big business will probably note that the proximate timing of these two events is almost certainly no coincidence. This is how things work. So when one company does something of note, you should automatically be watching its competition because more likely than not, there will be a response and it may just benefit you.

So there you have it. One opportunity begets another. In this case the gain will be $300 this year plus a modest amount in the low hundreds in subsequent years. But given that applying for the Wells Fargo Propel card took me no more than five minutes and switching my Bank of America Cash category selection here and there will take me no more than that over the course of an entire year, this is still a more than worthwhile maneuver.  

Awesome Books I Recommend

Reading is a very rewarding aspect of my life. I believe that the day a person stops learning, he begins to lose relevance. Of course there are plenty of ways to learn but with reading, you can expand your knowledge in a very focused manner. You can then integrate this new knowledge into your life in all sorts of ways which will make you a more interesting and capable person. This will translate into a more successful and fulfilling life. Plus, reading a book while you drink coffee in the morning is a wonderful way to get your day off to a great start. Every now and again I will post a quick review of a book I really enjoyed and here is the first one.

The Consuming Instinct by Gad Saad (2011)

Gad Saad has made a name for himself by applying his study of the young, but revolutionary field of evolutionary psychology, to marketing. He also happens to be very adept at explaining very complex concepts so that even someone who is not naturally very scientifically inclined, such as the author of this post, can not only understand them, but feel them come alive. In this book, Saad examines the relationship between consumption and the sum of what we have all had bred into us over the course of human history. The kicker is that he defines consumption very broadly so in the course of the book, he ends up covering a wide range of human behaviors.

This book helped me to understand a lot of what doesn’t appear to make logical sense about the world. For example, junk food exists. It is literally garbage that makes us less healthy and we all know that. And yet we pay our hard earned money to buy it and put it in our bodies, often in ridiculous quantities. If this were a purely logical world, junk food would not be produced at all because there would be no market for it. Once you’ve read this book, you will understand why it happens anyway along with so many other things. Saad also delves into the recently socially dangerous, but ever relevant topic of the differences between the way males and females think and act. Once again, he has very valuable insight and suddenly a whole bevy of behaviors I have observed but never fully understood are starting to make more sense.

This is a book that will really get you thinking and that’s what makes it so valuable. Plenty of scientists could undoubtedly write a book full of concepts that would be worthwhile to learn but difficult for a layperson to understand. This particular book accomplishes the former but bypasses the latter in favor of being very engaging. Simply put, this book is a great teacher and if you read it, you will come away richer for the experience.

Movies I’ve Enjoyed Recently

Normally I’m lucky if I see a movie a month. But since my weekends right now involve being as inactive as possible for a while so my ankle can heal, here are my thoughts on the movies that have been part of the bright side of this situation thus far.  Oh. And also from this weekend; as a guy who is STILL bitter about the 09 Vikings loss to them in the NFC Championship, the Saints got screwed.

Deadpool 2 (2018)

I went into Deadpool 2 not knowing what to expect. Would it fall short of recapturing the lightning in a bottle its predecessor did as so many sequels of surprisingly excellent movies do? It was a very different time in my life when I watched the first one. Could I have changed so much since then that I would feel differently about the entire concept now even if it were executed very well again? I’m happy to say that those concerns were unfounded whether evaluating the movie relatively or on its own merits. Everything that made the first Deadpool great is not only preserved, but developed a little further. One of my favorite elements of the first movie was the juxtaposition of ridiculously violent scenes and music that just didn’t match them at all. That has been taken to about its limit in this one and it had me laughing as hard as I’ve laughed in a long time. The unapologetic irreverence and constant smart ass quips are still there and the timing and pace are just as good. All Deadpool’s friends are back (with the exception of Francis obviously) and he makes some compelling new ones as well. Minor spoiler alert: not all of the new characters last very long but their quick deaths are about as hilarious as deaths can be.

But beyond being rolling on the floor funny, the plot is where this movie really shines. This time it’s more complex than simply “good guys against bad guys” as not everyone is quite who they seem to be. The romantic relationship of every man’s dreams is still part of the movie but Mr. Wilson has to go on another hero’s journey rather than simply being allowed to enjoy it in peace. Ethical choices are presented and struggled with. Unlikely alliances are forged, broken, and forged again. An impressive range of emotions are explored given the nature of the movie. And ultimately, the whole spectacle is wonderful.

This is one franchise I will gladly keep following until it stops hitting it out of the park and that hasn’t happened yet. It accepts neither categorization nor convention and instead, it simply entertains without taking so much as a single breath between jokes, punches, etc. There isn’t a roller coaster with rapid enough twists and turns to merit being a metaphor for what this franchise does. I’m not a fan of most superhero movies and I hope the concept has almost outlived its day as the automatic profit machine of the industry so we can start seeing a little more variety. But the Deadpool series is so much more than just another superhero movie. And while it makes liberal use of jokes about, and references to, other storylines I personally know nothing about (I think most of them are X-Men related), it never seems to do so in a way that leaves me feeling on the outside looking in. At the end of the day, I can’t think of any valid criticism of this movie and I made a pretty determined effort to do so in the time since I watched it. If you can, I would be very interested to hear it.

The Usual Suspects (1995)

I know, I know. This is a classic and it’s criminal that I’ve lived this long without seeing it. But cut me a break; I wasn’t even ten years old when it originally came out and it has taken me some time to find my way to it as an adult. I suppose I should give the movie the benefit of the fact that it is a quarter century old and a lot has happened since then. For example, today Kevin Spacey is more to some folks than simply an incredibly gifted actor. But he certainly is that as well and he was awesome in this movie. The elapsed years have also given me the benefit of having seen a lot of movies that have likely stood on the shoulders of this one and others like it, which may explain why I was able to see the ending coming fairly early on. Usually I don’t have that ability.

In general, this movie was well acted and the plot very cleverly crafted. It was entertaining and enjoyable and I can understand why so many people love it – even in 2019. I will say that it didn’t overwhelm me from an emotional standpoint. Maybe if it had, my brain would have been distracted enough to prevent me from figuring out the ending as early as I did. But regardless, the movie certainly challenged itself and the audience more than most of the rehashed, formulaic crap we see today. And I believe it conquered that challenge, even if not in a totally transcendent way.

Bohemian Rhapsody (2018)

I don’t see many biopics and even fewer musical ones but Queen, or more specifically Freddie Mercury, has always captivated me so I decided to check this movie out. Freddie Mercury was acted very well, some of the supporting actors were also pretty solid, and the music was great, of course. But there is one thing that started gnawing at me early on and only got worse. For me, a movie of this nature is only the beginning; the first thing I did when I finished it was to google Queen and Freddie Mercury and start reading. And at that point, I quickly understood where that disconcerting feeling had been coming from.

Why? The movie changed a lot of facts for no apparent reason and based on my reading, it may have done the same with some of the less quantifiable aspects of who Mercury actually was as well. I didn’t find anything written about why most of these liberties were taken with the history of a man and the band that rode his legendary star power from very likely obscurity to “fame and fortune.” But I can’t help but feel like maybe it has to do with that old quote about history being written by the winners, applied to this particular situation on the basis of who is still alive and who is not. I’m not going to go into all the discrepancies I noticed because I don’t want to ruin the movie for anyone but there were quite a few if much of what I read had any credibility at all.

I don’t know how much of a hand the surviving band members had in making this movie but I understand it had to be made in such a way as to garner their approval so they would allow the music to be used – obviously an essential element. And I think that is probably the likeliest explanation of why the movie almost seemed to be trying to alter the characters involved to make the balance of the situation appear different. I get it; there were band members besides Freddie Mercury. To highlight their contributions would have been fine. But to cast unjustified aspersions on Mercury’s memory in an attempt to make others appear more significant or more responsible for the band’s otherworldly success does give off a hint of sour grapes. I would still say the movie is worth seeing for the combination of some very capable acting and the fun of seeing the music performed. But the whole thing did leave me with a funny taste in my mouth and the more I read about the real story the movie was based on, the more I realized why.

Why You Should NEVER Use a Debit Card

In my bank account basics post, I said you should never use debit cards and I promised to write a follow up post with my reasons. I’m a man of my word so here I am delivering on that promise. I’m following up quickly because this is very important. There is absolutely no reason to have a debit card at all much less use one. I ask banks not to order one when I get a new checking account and if they insist on doing so anyway, I shred it the minute it shows up without ever activating it. This is because as I will explain, debit cards aren’t just useless; they are not safe. I know, they also serve as ATM cards. So plan ahead. Keep whatever cash you might spend in a month in your wallet and replenish it when it runs low. Actually, do people still use cash? I’ve had the same sixty dollars or so in my wallet for as long as I can remember. Anyway…

As a little change of pace, I’m going to try a list format today. So without further ado, here are my reasons you should never use debit cards.

1. They are dangerous.

With a debit card, any criminal that gets ahold of your card, or more likely your card information, has direct access to your bank account. The minute that happens with your debit card, a clock starts. If you report the situation immediately and no fraudulent charges have been made yet, you aren’t liable for anything. Of course in many cases your first indication of fraud will be a fraudulent charge so you aren’t likely to be this lucky. If there are any fraudulent charges made and you notify the bank within two business days, you are only liable for the first $50 – still not a disaster, but more than I want to be paying for some asshole’s actions. If you miss the two business day mark but you do notify the bank within sixty total days, you’re on the hook for the first $500. Keep in mind that this is by far the most likely scenario. And finally, if you fail to notify the bank for a full sixty days, you are liable for ALL fraudulent charges. Ouch.

Now compare that to what happens with a credit card. You are liable for up to $50 but the vast majority of banks waive that because being able to advertise “zero fraud liability” is a bargain at that price. That’s literally it. You sleep easy knowing that when (yes, that’s WHEN, not IF) your card information is stolen/hacked/etc, your problem is limited to the inconvenience of a short conversation with the bank’s fraud department and waiting a few days for a replacement card to show up.

2. Direct access to your bank account affects more than just fraud.

I stay in a lot of hotels and when I check in, I usually see a sign informing me that if I use a debit card, a hold will be placed for more than the total expected cost of my stay to cover incidentals. I have no idea how much more because I don’t use debit cards. But it is enough that they almost always have a sign and I’m guessing that’s because they get a lot of complaints otherwise. This hold likely won’t be released until you’ve paid the final bill upon checking out and that’s at the earliest. I wouldn’t be surprised if it takes a day or two after that. And keep in mind that with a debit card, this means you literally don’t have access to this money even if it is in your bank account. If you’re not maintaining a high enough balance to account for this, you could literally wind up overdrafting because of it and no, neither the bank nor the hotel is going to pick up your overdraft fees. I often see similar signs at gas stations and I’m sure there are plenty of other businesses that do this too.

3. Debit cards aren’t very “rewarding.”

I’ve already written a post detailing how I get paid back an average of about 3% on anything I am able to pay for using credit cards. That’s not counting the churning, which gets me free flights or cash in $500-700 chunks. You always want to be looking for extra sources of income and simply using credit cards for purchases gives you a nice one that requires almost no effort and is tax free to boot. I believe debit cards do offer very limited rewards but nothing close to the bonanza credit cards do. This is because the transaction fees charged to merchants by the banks are legally limited and thus, there is less kickback money available. So by using debit cards, you are literally costing yourself money.

4. Debit cards do not help you build credit.

You need a credit score for lots of things now and rightfully so. If you don’t pay your bills on time, that is directly applicable for a creditor or a landlord but it’s also helpful information for insurance companies, employers, and many other entities that may be considering doing some sort of business with you. Why? If you don’t handle your finances responsibly, there is a strong likelihood that you make similar choices in other areas of your life. Or put another way, credit reflects character. Yes, people run into unfortunate circumstances sometimes. But those things happen to all of us. If you’re handling your finances well, you have built a nice buffer of resources and you can weather the storm as long as it isn’t something totally catastrophic. There are certainly cases where people get hit with something very few could withstand but those are outliers and far more often, this is simply an irresponsible person making excuses. Long story short, credit scoring isn’t going anywhere because the concept is sound even if the execution occasionally isn’t. Debit cards don’t build credit in any way, shape, or form; credit cards do. P.S. I think I’m going to have to write a post on the ins and outs of credit scoring. Stay tuned.

5. Debit cards don’t give you an interest free loan.

Don’t misinterpret this; in no way am I advocating carrying a balance on a credit card. Ever. But when you use a credit card to pay for a purchase, you are not billed until the statement date. At that point, you have at least twenty days before your payment is due. This means that depending on when in a month you make a purchase, you get an interest free loan of anywhere from 20-50 days. To anyone who understands the time value of money principle (there’s another post to write), that is a sweet deal! Mind you the bank is betting you will fail to pay the full statement balance by the due date and then…well, you know what happens then. Pull your pants down, bend over, and by the way, they’re fresh out of lube today. But if you’re following the credit card rules I included in my credit card post, this will never happen to you. And consequences of irresponsibility should not concern those of us who are responsible.

6. Debit cards don’t give you rental car insurance, extended warranties, price protection, and all sorts of other extra benefits.

This may seem like a minor point until you buy something for $399 and it’s marked down to $299 two weeks later. If you used a debit card to make that purchase, tough luck. But if you used one of the many credit cards that offers price protection, you’re a phone call, a simple form, and some processing time from getting your hundred bucks back. If you rent a car, most credit cards include insurance so you can laugh when the agent generously offers to charge you some exorbitant amount “for your peace of mind.” Make sure to verify that your card offers this first though. Credit cards offer all kinds of little goodies like this that debit cards do not.

In closing, I know there are people who use debit cards because they’re afraid of overspending on credit cards. But the answer to an alcohol problem is to fix your thinking and habits, not to stop drinking anything and instead start taking in fluid only through an IV. In another manner of speaking, don’t try to get rid of your disease by bleeding yourself like they did in the revolutionary war era. Hurting yourself more is not going to help. Credit cards are the adult method of paying for things. Basically, think of them like condoms; they require just a tiny little bit of thinking and planning ahead but they also protect you from being directly exposed to some really bad things. The only flaw in that analogy is that condoms turn down the volume a little whereas credit cards actually enhance the experience of paying for things. Enough fun for today. Please, shred your debit cards and start managing your finances like an adult. I promise it is much more rewarding than making excuses for not doing so.

Bank Account Basics

The mighty Amegy tower, up close and personal

Happy weekend, everyone! I hope you’re having a great one. The title of this post should be pretty self-explanatory. For whatever reason, a lot of people seem to get tripped up by banks. So I thought I would write a post to make sure no one who reads this blog is getting screwed. I will start with general rules and then move into what I specifically do to illustrate things a little more.

First off, if you are paying any fees, you are doing it wrong. Almost all checking accounts have monthly fees but almost all of them also have ways to avoid them being charged. Usually you just have to either run a minimum monthly amount through with direct deposit or maintain a minimum balance. I recommend a bank with online bill paying services and there again, fees being charged equals pass. It’s nice to have physical checks too just in case and many (although not all) credit unions and some banks throw in a lifetime’s supply for free. Otherwise you should pay no more than $20-25 and again, that is for a lifetime’s supply of checks if you’re doing things right. That is about it for fees aside from the stuff that should be obvious. For example, reconcile your account on a regular basis so you never overdraft. That can turn into a slippery slope quickly so just make sure it never happens. That is one of the reasons I reconcile my accounts weekly.

You should divide your money into three categories – checking account money, savings account money, and investment money. Checking account money should only be what you need in order to pay your bills each month plus a buffer of maybe a thousand or two just in case anything weird happens. Savings account money should be your emergency fund plus any other cash that you aren’t using for investments right now. And investment money should not be with a bank at all since there are far better options regardless of what you’re investing in. So the remainder of this post will focus on just the first two categories.

I have accounts with several different banks but a lot of these are holdovers from when personal bank account churning was worthwhile that I simply haven’t gotten around to closing yet. I guess that’s a “to do list” item for me. In general, I use three banks for deposit accounts. One is my primary checking account bank that I pass the money I need for my monthly bills through, one is my secondary checking account bank (more on that later), and one is my savings account bank.

My primary bank is almost always a credit union. This is because as non-profit organizations, credit unions are usually much more customer friendly than banks. Their fees tend to be fewer and lower and their rates tend to be more competitive whether you’re paying (auto loans, mortgages, etc) or being paid (savings accounts, CDs, interest bearing checking accounts). As I said, I use this account to pass my bill money through. My current credit union’s checking account pays 7.5% on the first $500 that is kept in it, meaning I get about $40 a year for using it. Nothing to get too excited about obviously but it’s free money since I would be passing my monthly bill money through a checking account somewhere anyway. Many credit unions offer a small sweetener like this one way or another but watch out for the ones that have some absurd requirement like completing ten debit card transactions per month. That reminds me, DO NOT EVER USE DEBIT CARDS. I will explain why in an upcoming post but for now, if you’re using them, please stop for your own good. Anyway, if I were going to get an auto loan again, and I might for a very specific set of reasons (more on that in yet another upcoming post), this credit union would be my first choice as their rates are excellent.

Your secondary bank can be whatever bank you want although of course another bank that pays you in some way is the best choice. Why have a secondary bank at all? Banks aren’t perfect. I once had a bank freeze my account on a Friday evening because I attempted to make an external transfer to one of my accounts at a different bank. This happened in spite of the fact that I had already completed the external account verification process. The friendly, but incredibly inept call center employees (I spoke to several over what amounted to about two hours) were unable/unwilling to restore my access even after I had correctly answered every security question they had. Why did they bother asking the questions then? I would love to know that myself. Anyway, I couldn’t touch a dollar of the money in my own account until Monday when I could go into a local branch, show multiple forms of ID, restore access, and then obviously withdraw all my money, close the account, salt the earth, etc. Another time I had $1000 deducted from an account because someone totally unrelated to me made a transfer using a wrong account number that didn’t exist and mine was the closest actual number. Seriously, that is the best explanation I ever got – and I talked to several people and demanded better because that is obviously bullshit. It took a few days to get that one resolved and my money returned to my account. These things can happen at any bank and they do. Keep in mind that the banking industry is not what it once was and today many of the employees are nothing but glorified cashiers. It’s reality. And that $1000 could just as easily have been $10,000 or any amount at all or my entire account as in the other situation. If I had needed access to my cash at one of those moments and I had only the one account, I would have been screwed through absolutely no fault of my own. The only real way to avoid a situation like that is to have a backup account at another bank to use when your primary bank does something idiotic. As a little extra precaution, I keep a reasonable amount of cash in my safe at home as well. And yes, I also have guns at home and yes, that home is in the great state of Texas where the law is comfortably on my side should anyone me an ill-intentioned visit. Enough said.

My third bank is for my online savings account. Why have an online savings account? Aside from friendly little gimmicks like my credit union has, brick and mortar banks don’t pay enough to merit keeping your savings account money with them. Don’t believe me? Go check. You will be hard pressed to find a rate above .2% without the ridiculous debit card shenanigans I mentioned earlier. Meanwhile, my online savings account at CIT Bank is paying 2.45% and I can have that money in hand in a day or two if I need it. Want a bonus? CIT’s customer service is actually very good (we’re talking Americans answering the phone here and acting as if they actually care about you as a customer to boot) and I recently discovered that they send wires for free! Wires typically cost $20 and up to send so this is amazing, particularly for a guy who needs to send them for his side business every now and again. CIT is FDIC insured up to $250k just like any other reputable bank. If you’re looking for an online savings account and you’re not sure, just look for the FDIC (or NCUA which is the same thing but for credit unions) logo. If it isn’t prominently displayed, you will want to find a different bank immediately.

There you have it – my basic bank account guide. Hopefully it helps you to either save or make at least a little bit of money. And now I have to go close some accounts and add a few more items to my list of upcoming post topics.

The Opportunities in Life’s Challenges

My new, temporary traveling companions

And just like that, I’ve come crashing right back down to earth – quite literally in fact. I tried not to be too over the top as I celebrated my good fortune in my last post but the universe noticed anyway. Literally the next morning I suffered a severe ankle sprain in a basketball game and I’ll likely be on crutches for at least a month or two. That’s the way life goes sometimes. I’ve found that particularly if you haven’t faced any difficult situations recently, you can expect that to change before too long. And no amount of money will exempt you.

I get frustrated with these situations like anyone else. Crutches certainly aren’t very convenient for a guy who spends a lot of his time driving around; and neither is a painful right ankle the size of a softball for that matter! But life isn’t any more willing to take a break for me than it is for anyone else. So I’m driving very gingerly and maintaining a much longer following distance than usual. And yes, I’d be lying if I said I didn’t have a few choice words for the couple of folks who forced me to slam on my brakes today in spite of my efforts to avoid having to. To be fair, they weren’t singling me out; they’re just as reckless and negligent around the vast majority of people on the road whose ankles are healthy. But this post isn’t about the horrible drivers in this town so I digress.

When I’m forced to deal with a situation like this, I try to focus on being thankful for things I normally take for granted. For example, it’s awfully nice to be able to walk to my car without crutches and carry items in my hands instead of in the backpack I’m using now. It’s a privilege to be able to seek out extra exercise through the course of a day rather than having to avoid it. I know these things every day but today, they’re right in my face to the point where I have no way to ignore them. Normally it’s fun to be able to play a round of golf or even a game of pool but today any attempt at either would be painful and futile. All day, I’ve been mentally adding things I would never give a second thought to otherwise to this list and although I’m annoyed that I can’t do them right now, I’m doing my best to look on the bright side.

After all, there are people who will never walk again – not even with crutches. Hell, there are people who have never walked at all and never will. This experience gives me a window into the perspective of someone living that kind of life. I will be fully functional again before too long but hopefully I will have this in the back of my mind the next time I see someone who isn’t and have more empathy than I did before. This isn’t my first time living the temporary crutch life. But I’m older and wiser than I was last time so I believe I will learn my lessons more effectively than ever before. If I’m able to look at this experience with the right attitude at least part of the time, it can be an excellent opportunity to improve myself.

And that is the case with every challenge you face in life. Every single one. My divorce was far and away the most difficult one I’ve faced so far. But I’ve easily grown more as a person in the years since it happened than I had in the entirety of my life leading up to that point. I understand myself, others, and life itself much better than I ever could have before I went through that. I still remember a guy from high school who had been paralyzed from the waist down, was confined to a wheelchair, and even with his hands had only limited motor function. But I don’t remember him for any of that; I remember him because he was simply phenomenal. He couldn’t change his past or even a lot of his present but he was absolutely determined to make the most of what he did have control over and it came out in a seemingly unstoppable positive energy that immediately lit up any room he entered. At that age I barely understood what I was looking at in him but he had taken an incredibly unfair event in his life and used it to turn himself into someone truly awe inspiring. Most of us will never have that caliber of bad luck but all of us will have some and we would do very well to handle our situations with the attitude he handled his.

We all know a perpetual victim. Something is always happening TO him or every time you talk to her, she has something to complain about. Those people are never going to grow unless something wakes them up. I know because for many years, I was one of them. Your life literally IS all of the things that happen to and around you, whether good, bad, or anywhere in between. Eat and drink the joy of the good moments with all your heart but when the bad ones come, those are the opportunities. If you take advantage of them, you will turn even the bad moments into more good ones and yourself into a better, stronger, more capable person. If you add it all up, it equals a better and more significant life. It isn’t easy. But what worthwhile thing is?

A Day of Triumph and Reflection

It was immediately rewarded with a tasty fortune cookie so this fortune was, in fact, correct

Today was a very big day for me. This morning I was informed that I recently achieved one of the sought after milestones of people in my line of work: a five figure payday from a single deal! So I’ve been enjoying the hell out of my moment all day and now I want to reflect a little bit, both to mark this for myself and to hopefully inspire someone else to keep fighting the good fight even when it doesn’t feel like it’s accomplishing anything.

First and foremost, I am overwhelmed with gratitude. Only a few years ago, I was working a salaried office job where I didn’t get any bonuses at all. If that version of me could see me today, I don’t know if he would believe it. It was just impossible to see even the possibility of a day like this from where I was at that time. A very small portion of the population knows what it’s like to be able to make this much money this quickly – probably a single digit percentage. It is an incredible privilege to be among them and even more so given that this isn’t even a terribly unusual occurrence in my profession.  

Of course I have worked very hard to get here. This particular deal took weeks of back and forth and culminated in a whirlwind trip that included a flight to Memphis, driving halfway across the state to Jackson and back, and another flight to Chicago, all in about a twenty four hour period. And of course I have also had some good breaks. Those do typically come to capable people who work hard. But I also got plenty of help from some incredible people. One woman was willing to go to bat for me with a good friend of hers (now a good friend of mine) who happened to be a superstar with my current employer before I even knew the company existed. My manager treats me very well, works his ass off every day, and does an amazing job making everything I do possible behind the scenes. Most of my fellow sales reps have been welcoming and helpful but a few have treated me like family and provided endless mentoring, advice, insight, and support all along the difficult journey from brand new, first time sales rep to whatever it is that I am today. Obviously my life isn’t perfect and neither is my employer. But I have gotten better and better at focusing on the positive side of things and the results have been wonderful. I couldn’t be more thankful for the many people who have contributed to my ongoing success and I will be lucky to pay it all forward if I live to be 100.

Gratitude is obvious on a day like this. And of course part of me is incredibly excited. But I also surprised myself. Part of me just kind of shrugged this whole thing off. How does that make sense when I’ve been pursuing this day for almost three years? I think this is where the “it’s the journey, not the destination” quote comes in. Sure, longing for this “destination” has fueled a lot of my activities for a long time. But somewhere along the line, it became about something else. As I started to succeed with deals that led to big paydays, of course I was happy about the money. But I noticed that I derived more satisfaction from the personal growth that had allowed me to make it. These deals were the kinds of opportunities I had failed to convert on or possibly not even noticed at all just a year or two prior. I don’t think there is any feeling in life quite like the one you get when you realize you can do something now that you couldn’t before.

And today is similar. Yes, I scored a big one. But there is a very good chance I will do it again this year and possibly more than once. I have a handful of deals nearly as big in the works as I type this. I probably won’t close every one. But I will almost definitely close some of them. The incredibly fortunate reality is that I am on a relatively lucrative career path and am at the point where things are starting to go my way more consistently. The excitement I feel over this win comes from viewing it through the window of my past whereas the feelings of pride, contentment, and joy are from where I sit today.This can be an amazing life if you work hard and position yourself in such a way that it is likely to pay off. None of this would have happened if I hadn’t gotten myself a good education or taken advantage of the opportunities in the not so great jobs I had before this one. There were plenty of days when I felt like I wasn’t making any progress and sometimes I didn’t want to go to work at all but I did it anyway and did my best to learn more than my job required and go above and beyond in any way I could. I also wouldn’t be enjoying my current success if I hadn’t worked hard resiliently in this job. For every day like this one, there were probably a few dozen where I struggled mightily and didn’t come away with a win at all much less a big one like this. Even today, while basking in the glow of my good fortune, I was hung up on while making some cold calls. Life never stops being difficult but if you do the right things consistently, your capabilities will never stop increasing either and you will win more and more often. When I started this job, being hung up on would have bothered me. Today I simply shrugged and moved on to the next name on the list. That change didn’t happen by itself and it wasn’t easy. But if I hadn’t done everything it took to make it happen, today would never have happened either.

That’s all for now. Have a wonderful night, sleep well, and go out and be the best possible version of yourself tomorrow! You never know what might happen if you do.

The Most Important Investment

Most of my personal gym in the basement of my former Wisconsin home

Investing is one of my favorite activities and I look forward to writing plenty about it on this blog. But I’d be doing you a terrible disservice if I didn’t start with the most important investment: your health. The quote “health is wealth” and permutations of it are so common that there is no single known source and many of the quotes date back well over a thousand years. And it is universally true in every way possible.

There is certainly an economic argument. Health care is expensive. I don’t need to tell you it’s already expensive today at whatever age you are and the cost is only going to go up. The current estimate is that the average person will spend roughly $250k from traditional retirement age to death on health care and of course inflation will increase that number if you aren’t there yet. But in this case, the best defense is a good offense. If you are in good health, you can reduce your exposure to the health care system or even eliminate it for anything beyond your annual preventative care visits and the occasional issue that pops up. $250k is a huge figure to chip away at and you can start saving money in this area every year before you get to retirement age as well.

But this is even bigger than economics. After all, even a billionaire can’t buy back his good health once it’s gone. His vast fortune will get him the best care available and make him as comfortable as possible while he dies but it can’t get back what has been lost. Most of us will never be billionaires but this is one rare example of something we can have that some of them can’t.

And this is so much more than simply putting off death. By investing in your health, you will improve the quality of your life every single day. See those people all over the place who are so fat they can barely move much less live the kind of active lifestyle a fit person does? Now take a look at the attractive people the obese masses try so hard to convince you represent an unrealistic standard. Which group do you want to be a part of? How much money do you think the people in the first group would pay to be part of the second instead? That’s right; this investment yields a return you can’t even quantify. And it is much easier to stay part of the second group from day one on than it is to renounce your membership in group one and join group two. As in most areas of life, preventative maintenance is much, much easier and cheaper than repairing damage.

And please, ignore the naysayers. You do not want the bitter, resentful life they are living. You can’t change your genetics but you can certainly change lifestyle factors. Anyone could potentially get lung cancer but it is far less likely to happen to someone who doesn’t smoke. Everyone has heard of the occasional fitness fanatic who had a heart attack and died at fifty. But the only reason those stories are even noteworthy enough to get your attention is that the scenario is extremely unlikely and therefore shocking. Lifetime smokers, obese people, etc, die young every day so no one is even going to bat an eyelash when they do. You can’t outwork the possibility of all negative outcomes but you can most definitely put the odds in your favor and win most of the time.

So how do you start investing? You don’t need a dollar to do it although gym memberships are very cheap these days (I’ve seen as low as $10 a month) and that’s the most effective route for most people. Your main investments are time and effort but you also need knowledge and discipline – both of which can be acquired and increased with time and effort.

How much time? Your government overlords tell you 150 minutes per week is the minimum. I don’t like mediocrity so my minimum is 300 minutes. That’s 30 minutes of moderate intensity cardio every day with 30 minutes of serious resistance training three days a week. And again, that’s a minimum. That’s what you do if you’re sick or maybe rehabbing an injury. That also doesn’t include walking. It is very important to walk around at regular intervals throughout the day. You should avoid sitting for more than a half hour of uninterrupted time at all costs. Get a Fitbit or another fitness watch that incorporates a pedometer if it helps you. The science is very clear on the devastating impact of long periods of sitting – even if you get enough exercise overall.

Again, that’s the minimum. What do I do under normal circumstances? 570-750 minutes per week is a rough estimate. That is comprised of: 30 minutes of moderate intensity cardio every day, 60 minutes of serious resistance training 4-5 days a week, and 2-4 hours of participating in sports in a typical week (in my case, lately that has been mostly tennis, basketball, or hitting a heavy bag – no, I don’t count golf as a sport although I enjoy that too). Some weeks I’m a little below that and many weeks I’m above. The latest and greatest studies show there really is no reasonable upper limit to the amount of exercise people can benefit from. I actually consciously moderate mine as my body is very prone to overtraining and injuries in general so your numbers could go higher if you are more genetically blessed in that area.

Another facet is exercise intensity level. As a general rule, start slow/light and gradually work your way up. Don’t try to go from zero to hero overnight. The lost time spent dealing with injuries will easily destroy any additional benefits whereas the long term progress of ramping up gradually, but consistently, will be an incredibly rewarding experience.

Another huge aspect is diet/nutrition. This is easily an entire series of posts all by itself but here are some of the basics. In general, American portion sizes are much too big. You need a lot less food than you think. A good rule of thumb is that if you’re eating at a restaurant, you should be taking home at least half of what is served in a to-go box; this is a financially friendly practice as well. Eat lots of vegetables – at least five servings a day. You almost can’t overdo this. And no, potatoes and corn don’t count. Eat some fruit but in moderation as there can be a lot of sugar in it. Go high protein; .5-1 gram per pound of bodyweight per day is a good range for most people. Eat a moderate amount of high quality carbohydrates. So whole grain bread instead of white, brown rice instead of white, complex versus simple. These are items you should eat.

But you also need to minimize eating garbage or eliminate it altogether if you struggle with the minimal concept like I do. And yes, soda falls into the garbage category along with anything else that is highly processed or made of primarily sugar, fat (chips, fries, etc), or both (ice cream). And no, diet soda isn’t better. Soda in all of its forms is pretty close to cigarette status as far as your health is concerned; you simply shouldn’t ever consume it unless you really hate being alive and want to get it over with ASAP. Avoid soy as much as possible, especially if you’re a man. It’s horrifying how much of this poison has worked its way into our food supply. It requires tons of processing just to make it consumable by humans but even worse, it messes with your hormones. Anything in that category should be setting off a bright, flashing, go straight to jail, do not pass go, do not collect $200 alarm in your head. While we’re on the subject of avoidance, minimize dairy consumption. Studies are still somewhat conflicting but are starting to trend towards anti-dairy conclusions, particularly when you factor in how many of them are funded by the powerful dairy industry. I treat dairy as a garnish item and an occasional treat and even that policy is probably pushing it.

The most important thing with investing in your health is to get started. If you’re currently leading a sedentary lifestyle, I have good news for you. Just by getting started, you are likely to see benefits much more rapidly than the average person. That’s not to say that it isn’t worthwhile to work on improvements if you’re in that average camp or even if you are a fitness veteran. The further up the fitness ladder you can get without it becoming psychologically unhealthy, the better. Too much of anything can be problematic – even something good. But in modern society, we have precious few people who are in any danger of reaching that level in the area of fitness and nearly all of us could benefit from some ramping up. You will notice the differences all over your life – feeling better both physically and psychologically, people responding more positively to you, clothes fitting better, sleeping better, looking better, and on and on. Simply put, I can’t overstate the value of investing in your health and if you start doing it more, I almost guarantee you will agree.