A few ideas for minding your money and your time

Let’s take on four ideas today — none of them linked in the slightest.

First, rest in peace Charlie Munger.

The friend, adviser and business partner to Warren Buffet passed away in late November at the age of 99. Despite being worth billions, like Buffett, he still lived in the same home he built 70 years ago.

In one of his last interviews with the Wall Street Journal, he shared two pieces of investing advice:

The first one dealt with humility. Munger warned against a particularly brutal cognitive bias for investing, which in his words was “the constant tendency to overrate your own intelligence and skills in deciding what to do and what not to do.”

Next, to his career in stock picking. He mused that while it was fun, fewer people should do it anymore. He seemed especially concerned about ordinary people trying it. According to Munger, “Most people probably shouldn’t do anything other than have index funds…. That is a perfectly rational thing to do for somebody who just doesn’t want to think much about it and has no reason to think he has any advantage as a stock picker. Why should he try and pick his own stocks? He doesn’t design his own electric motors and his egg beater.”

But people didn’t make pilgrimages every year to the Berkshire Hathaway annual meeting for just investment advice. Munger and Buffett often gave life advice. Sometimes in the personal finance world it can feel that being good with money goes beyond the discipline, self education and life choices to use money to enhance our lives. Instead, it can become the opposite, where maybe through obsession we can use our lives to enhance money.

To that point, here is one of my favorite life quotes from Munger:

“If all you succeed in doing in life is getting rich by buying little pieces of paper, it’s a failed life. Life is more than being shrewd in wealth accumulation.”

Second, we are getting nickeled and Benjamined.

As many of you know, the Gutierrez household operates

in a save-ahead world, where we accumulate money in various savings accounts over time for big ticket items, like taking family vacations. The last year, in particular, has been difficult to accumulate as planned, and it seems to be from the frequency of expenses around $100 each. Previously, acceptable gift cards would have run $50 but now seem to be $100. The costs of kids’ uniforms for activities, massages, a trip to the mani/pedi, the two trips to the vet, the three visits to the pediatrician, (and I could keep going) continuously run around $100. Going out to eat is a solid Benjamin for a family of five for burgers or tacos after accounting for taxes and tip.

What’s the answer? To get control, I have given myself a 48-hour cooling off period before paying for anything unplanned over $100. I can already see it working. Waiting allows me to better understand the choices and substitutions for our more discretionary Benjamins. Better meal planning and press-on nails are a start to replace eating out and my holiday trip for the mani/pedi. For what we can’t avoid, like healthcare, choices have to be made.

OK, we will keep the kids. And the dog. The money to pay for their pricey visits will just have to temporarily come out of one of our save-ahead squirrel funds. In the near-term we will slow down our travel, the thing we love most, until we can get those Benjamins back under control.

Which we will.

Third, if you are hooking up with Schwab, get a broom.

Schwab boasts an exciting money market option with an SEC yield hovering around 5% (after factoring in fees). The only catch? You have to physically transfer your money into it! Schwab makes quite a bit from defaulting folks into its sweep account which is currently running at only 0.45% yield. Money can end up finding the sweep account from dividend payments or for newly deposited cash. Unfortunately, when people forget to check on the money, just assuming that they are getting the higher yield, they potentially lose on tens, hundreds or thousands of dollars in interest. Pro-tip to select dividend reinvest on investments to avoid this issue. For cash deposits, please get your broom and sweep up that cash into the higher yield money market.

Full disclosure, I am a Schwab customer. It’s a great platform with great fees, and probably not the only company right now with such a practice. Be vigilant at any company double checking the yield on your cash holdings.

Finally, consider a holiday break from social media. I have previously written about my experiment with saying “no thanks” to Insta, Facebook and TikTok that has now become permanent. The rewards continue to roll in, financially and psychologically. Most importantly, those hours previously lost to addictive scrolling are mine and have been replaced with reading about a book a week.

Let’s sum it all up. Follow Charlie Munger’s advice to save and invest your money simply, but avoid obsession of your money and wealth. Plug your leaking Benjamins with a cooling-off period. Get a broom for your low-yielding sweep account. And maybe experience this holiday season lost in a book, not your phone screen.

Sarah Catherine Gutierrez is founder, partner and CEO of Aptus Financial in Little Rock. She is also author of the book“But First, Save 10: The One Simple Money Move That Will Change Your Life,” published by Et Alia Press. Contact her at sc@aptusfinancial. com.