Category: Personal Finance

January 1st represents the start of a new cycle, an opportunity to recognize what we’ve been doing wrong and change it. A lot of people start diets, go to the gym and, in general, there’s a sense of optimism in the air.

With that in mind, here are my New Year resolutions for investors. I believe they will help you reduce your anxiety and have a more pleasant investment experience. Continue reading

Mutual fund

Image via Wikipedia

The securities industry is probably one of the most regulated in the United States. There are clear rules on what can and can’t be said in order to prevent false or misleading communications with the public.

Given the recent positive performance in the overall market, mutual fund advertisements are coming back to main stream media and trade publications.

It is common to see funds that tote their “good management” that “fare well” even in “difficult times”.

It is also common to see funds claiming to have the most awards from Lipper, Mornignstar or other rating companies that -to simplify- arrange funds by performance in a number of timeframes. For example, you’ll see that a some companies will claim to have “the most 5 star funds”, while others will claim to have beaten their “Lipper categories”. Continue reading

Gold and Irrationality

American Gold Eagle

Image via Wikipedia

For the last two years, the media has added to their “daily scores” the value of gold, which is now referred as often as the latest movement of the S&P 500 or the “Dow”. But today I’ll focus on gold.

Is gold really an inflation hedge? Continue reading

The cycle of life is full of smaller cycles.

Some people call it a roller-coaster, for me, life is a journey of learning that only leads to personal development and growth. One of such cycles is debt. To me, it went more or less like this: I got a job, money started to flow, with it, the credit card offers arrived, with them, more “stuff”. With the stuff, excitement for the moment, that led us to buy more stuff. Then, the “credit hangover”. The feeling of overspending. Guilt. Worry.

We learned that we needed discipline. So we stopped using the credit cards altogether. If it wasn’t truly necessary, we didn’t buy it. A small problem, though. We were making just a little over the minimum payments. Big mistake. So we started to pay more when we were able to.

God has been generous with us and so today we paid off two of the credit cards. It feels awesome.

It feels so great that tomorrow I’m going to buy some stuff to celebrate.

Just kidding.

So, the cycle came to an end. We still carry debt. But we’re going much more responsible about it. So, here my 5 tips to eliminate debt faster:

-Don’t buy with credit anything that goes down in value. Most stuff is worth a third less the moment you take it out of the package, you don’t want to be paying for it for months.

-Identify where all your money’s going. Are you overspending? Could you skip some indulgence in favor of paying debt?

-Pay more often.

-Take your credit cards out of your wallet (make sure you hide them well). That way, you’ll eliminate the temptation of taking them out next time you’re in a store.

-Focus on paying of  the smaller debt first. This way, known as the “snow ball method”, gives you a strong emotional boost and a sense of power that comes with completing challenges. Once you see that you can pay off a debt, you’ll try harder to pay off others.