PBS Frontline : The Retirement Gamble, sorta Must See (1 Viewer)

[Doctor Detroit]

I've been going back and forth with my traditional vs Roth 401k contributions the last two months. I had 6% Roth and 2% traditional, then 5/3, 4/4. 1/6, 3/5, and 2/6 the last five pay cycles. I figure I will never make more in retirement than I make while I am working, so the traditional makes more sense according to the rules. A lot of people have math on Roth vs Traditional but generally the numbers in the end will be similar. I think if you're in your 20s, pile on the Roth. If you are making a ton of $$$, Roth is good. Since you have to take distributions on a Roth 401k at 70.5, it's hard to predict how that might benefit you tax wise. So much can change in 20, 30 or 50 years.

One way I like to look at it is this. If I die before I retire I would have paid a lot more tax investing in the Roth, and I'm never gonna see that money. Might be a bit selfish but that extra money I take home now seems more important to my day to day life, and I think I'm going to bring in 75-80% of my final earnings in retirement. That's going to be more than I need, and I'm likely going to end up giving a lot of my money away (actually hope to do this). Not giving it away to family, but giving it to great charities and to institutions of higher learning.

 

[Sand]

I've been going back and forth with my traditional vs Roth 401k contributions the last two months. I had 6% Roth and 2% traditional, then 5/3, 4/4. 1/6, 3/5, and 2/6 the last five pay cycles. I figure I will never make more in retirement than I make while I am working, so the traditional makes more sense according to the rules. A lot of people have math on Roth vs Traditional but generally the numbers in the end will be similar. I think if you're in your 20s, pile on the Roth. If you are making a ton of $$$, Roth is good. Since you have to take distributions on a Roth 401k at 70.5, it's hard to predict how that might benefit you tax wise. So much can change in 20, 30 or 50 years.

One way I like to look at it is this. If I die before I retire I would have paid a lot more tax investing in the Roth, and I'm never gonna see that money.

Splitting things up haphazardly is fine since there are lots of large unknowables - future tax rates, your future income, etc. I figure it will all wash out in the end.

 

[flapgreen]

I listen to Dave Ramsey's podcast and I think he does a lot of good for people. In theory I agree with his premise of eliminating all debt, and I need to do some of that myself and should be mostly set by next spring.

What I disagree with however is Ramsey saying to completely ditch retirement account contributions unless you have completed the first three baby steps which are

$1000k in savings

paying off all debt outside mortgage

accumulating 3-6 month emergency fund

IMO you still have to contribute up to your employer match. Why would you ever give away free money? There is so little of it in the world I've lived in that it just seems like that is still going to be a priority even when in debt. Maybe I'm wrong. Thoughts?

Been listening to him for over 10 years. Changed my life

 

[urbanhack]

I know it'll be gone, but you can estimate your Social Security here.

Also I had no idea the Social Security salary cap was only $117k, I thought it was actually more like $175k. Seems like if they just slowly bumped that up, the system would be fine.

doubtful

What they should do is have kick in again once it goes above 250,000 or 300,000.

 

[xulf]

I know it'll be gone, but you can estimate your Social Security here.

Also I had no idea the Social Security salary cap was only $117k, I thought it was actually more like $175k. Seems like if they just slowly bumped that up, the system would be fine.

doubtful

What they should do is have kick in again once it goes above 250,000 or 300,000.

I approve this post.

 

[fourd]

I think the most important thing people need to realize when planning for retirement is that everyone is different - their is no one size fits all.

http://www.kiplinger.com/article/retirement/T047-C000-S002-how-much-you-need-to-retire.html

 

[Vikes1184]

I've been going back and forth with my traditional vs Roth 401k contributions the last two months. I had 6% Roth and 2% traditional, then 5/3, 4/4. 1/6, 3/5, and 2/6 the last five pay cycles. I figure I will never make more in retirement than I make while I am working, so the traditional makes more sense according to the rules. A lot of people have math on Roth vs Traditional but generally the numbers in the end will be similar. I think if you're in your 20s, pile on the Roth. If you are making a ton of $$$, Roth is good. Since you have to take distributions on a Roth 401k at 70.5, it's hard to predict how that might benefit you tax wise. So much can change in 20, 30 or 50 years.

One way I like to look at it is this. If I die before I retire I would have paid a lot more tax investing in the Roth, and I'm never gonna see that money. Might be a bit selfish but that extra money I take home now seems more important to my day to day life, and I think I'm going to bring in 75-80% of my final earnings in retirement. That's going to be more than I need, and I'm likely going to end up giving a lot of my money away (actually hope to do this). Not giving it away to family, but giving it to great charities and to institutions of higher learning.

DD - I participated in Fidelity webinar last fall that said the bolded above is correct, UNLESS you roll it over to a Roth IRA when you leave your company. Now its a Roth IRA and not subject to RMD. I know there are others on this thread in the industry that know this better and can chime in.

Found this article that offered more details. http://www.investopedia.com/articles/retirement/09/roth-401k-rollover.asp

As we all know, everyone's situation is different. I have also been looking at "spreading" the 401K contributions between those two choices as well to help diversify retirement savings between tax-deferred and tax-free to lessen RMD down the line. Hope this helps.

 

[Doctor Detroit]

Interesting stuff Vikes, thanks man.

Has anyone ever done a Rick Edelman webinar? They are like $20 and i generally like what he has to say.

I also got a social security account to estimate earnings and the like. I am one that considers social security solvent long-term, I'm at least confident I will get back what I put in.

 

[Sand]

And, predictably, our government is striking out against those dastardly people who don't pay any taxes on their retirement funds and have put forth a couple proposals to tax Roth IRAs.

Sadly this was entirely predictable. I'm surprised the current administration hasn't tried to seize these funds earlier.

 

[Tom Hagen]

And, predictably, our government is striking out against those dastardly people who don't pay any taxes on their retirement funds and have put forth a couple proposals to tax Roth IRAs.

Sadly this was entirely predictable. I'm surprised the current administration hasn't tried to seize these funds earlier.

To be accurate, neither of those proposals tax Roth IRA's per se. They simply force the Roth money to be withdrawn sooner (tax free) and presumably spent or reinvested in taxable accounts.

 

[Sand]

And, predictably, our government is striking out against those dastardly people who don't pay any taxes on their retirement funds and have put forth a couple proposals to tax Roth IRAs.

Sadly this was entirely predictable. I'm surprised the current administration hasn't tried to seize these funds earlier.

To be accurate, neither of those proposals tax Roth IRA's per se. They simply force the Roth money to be withdrawn sooner (tax free) and presumably spent or reinvested in taxable accounts.

The net effect is to keep the money from going into probate as tax free monies. The proposals aim to have the monies out into the taxable world and generate tax revenue from them. Just doing their best to get another slice of the pie.

 

[Doctor Detroit]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

 

[Johnnymac]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

 

[Ned]

I know it'll be gone, but you can estimate your Social Security here.

Also I had no idea the Social Security salary cap was only $117k, I thought it was actually more like $175k. Seems like if they just slowly bumped that up, the system would be fine.

Thanks for the link - cool to see the earnings record.

 

[eoMMan]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

 

[culdeus]

Does anyone here have a reccomendation for a kids savings account? Trying to start them early on the concept. I'm not talking UTMA college funds, talking more like allowance money and any gift monies they get for birthdays and crap like that.

 

[Dentist]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

agree. But BoA's keep the change only applies to their debit cards, and their credit cards have FAR superior benefits

 

[Slapdash]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Is that program even still going?

 

[Dentist]

Does anyone here have a reccomendation for a kids savings account? Trying to start them early on the concept. I'm not talking UTMA college funds, talking more like allowance money and any gift monies they get for birthdays and crap like that.

smartypig - very competitive interest rate

 

[culdeus]

Does anyone here have a reccomendation for a kids savings account? Trying to start them early on the concept. I'm not talking UTMA college funds, talking more like allowance money and any gift monies they get for birthdays and crap like that.

smartypig - very competitive interest rate

awesome

 

[Doctor Detroit]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Well it's not a savings account, they are going to have to have fees simply to make the trades they execute for the portfolios. And because there are no minimums or transaction fees, and people can take the money when they wish, it's not like an account at Charles Schwab.

I like the idea, I signed up. I'll probably get about $400 in there and go to the strip club with the proceeds, but it's a good exercise in rounding up spare change and it also is fun.

 

[Otis]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Well it's not a savings account, they are going to have to have fees simply to make the trades they execute for the portfolios. And because there are no minimums or transaction fees, and people can take the money when they wish, it's not like an account at Charles Schwab.

I like the idea, I signed up. I'll probably get about $400 in there and go to the strip club with the proceeds, but it's a good exercise in rounding up spare change and it also is fun.

Totally awesome idea. In.

 

[Doctor Detroit]

We should do a separate thread tracking our progress if we get enough to participate.

 

[Judge Smails]

One kid out of college, one with 2 quarters left, one entering her junior year. Just checked balances and the spreadsheet and the 529 funds are enough that I will get them all done with no debt for them or me. Great feeling. Will get a big raise as an empty nester - will help in the money run for retirement.

 

[Doctor Detroit]

Most of the well-known financial advisors advise against paying for your kids college. Personally I think it's something you should do if you can, but agree that if it is at the detriment of you own retirement, you shouldn't do it. Lots of stories of people who paid for their kids college and have almost nothing set aside for themselves.

 

[FUBAR]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

 

[Otis]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

One less thing to think about? For around one quarter of one percent, well worth not having to think about it.

 

[Otis]

We should do a separate thread tracking our progress if we get enough to participate.

In. Set mine up today, rounding up on my checking account and major credit cards. Should catch basically every purchase we make.

Also cheated and funded it with $100 to start

 

[FUBAR]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

One less thing to think about? For around one quarter of one percent, well worth not having to think about it.

I don't think about my spare change from CC purchases. How is this better than simply putting an additional 1-3% into your investment account?

 

[Otis]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

One less thing to think about? For around one quarter of one percent, well worth not having to think about it.

I don't think about my spare change from CC purchases. How is this better than simply putting an additional 1-3% into your investment account?

I wasn't putting an additional 1-3% in my investment account.

 

[FUBAR]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

One less thing to think about? For around one quarter of one percent, well worth not having to think about it.

I don't think about my spare change from CC purchases. How is this better than simply putting an additional 1-3% into your investment account?

I wasn't putting an additional 1-3% in my investment account.

ok. I might just be missing the point here.

Last month we used our main card 100 times which was slightly higher than usual due to back to school stuff. Presuming an average of 50 cents going into this account per transaction, that's $50 / month. What's the advantage of doing it this way as opposed to just putting $50 wherever you want?

If anything, doesn't this sort of encourage more CC use?

ETA: at least it seems cheap enough. $1 / month plus at most 0.5% of an account which could be a few hundred dollars, means you're spending just a few dollars per month for someone to charge you slightly more on your card and put it into an account for you. Seems like a really bad idea if you're carrying a balance.

 

[Doctor Detroit]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

One less thing to think about? For around one quarter of one percent, well worth not having to think about it.

I don't think about my spare change from CC purchases. How is this better than simply putting an additional 1-3% into your investment account?

I wasn't putting an additional 1-3% in my investment account.

ok. I might just be missing the point here.

Last month we used our main card 100 times which was slightly higher than usual due to back to school stuff. Presuming an average of 50 cents going into this account per transaction, that's $50 / month. What's the advantage of doing it this way as opposed to just putting $50 wherever you want?

If anything, doesn't this sort of encourage more CC use?

ETA: at least it seems cheap enough. $1 / month plus at most 0.5% of an account which could be a few hundred dollars, means you're spending just a few dollars per month for someone to charge you slightly more on your card and put it into an account for you. Seems like a really bad idea if you're carrying a balance.

No, I don't think so.

This app is aimed at those under 25 who are new to investing. I don't think anyone under 25 carries cash anymore, so they use their debit cards for pretty much everything. So for them there is a lot of value in this IMO. For people like me, it's for fun and for some side cash if I want to blow some money on something stupid.

 

[Dentist]

Most of the well-known financial advisors advise against paying for your kids college. Personally I think it's something you should do if you can, but agree that if it is at the detriment of you own retirement, you shouldn't do it. Lots of stories of people who paid for their kids college and have almost nothing set aside for themselves.

Agree.

But the finest thing my dad did for me in life was to ensure i wasn't strapped with deep student loans out of the gate especially since i went to professional school.

I sincerely hope I'll be able to pay for most or all of my child's college as well... although it's going to be tougher as college prices keep soaring!

I started saving before the kid was even born though.. so i've got a head start.

 

[Otis]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...I signed up for a test account, and while I havent made any investments yet, I really like what Ive seen of the app so far. Its painless to set up, it seems very secure, and its cheap: youre only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

One less thing to think about? For around one quarter of one percent, well worth not having to think about it.

I don't think about my spare change from CC purchases. How is this better than simply putting an additional 1-3% into your investment account?

I wasn't putting an additional 1-3% in my investment account.

ok. I might just be missing the point here.

Last month we used our main card 100 times which was slightly higher than usual due to back to school stuff. Presuming an average of 50 cents going into this account per transaction, that's $50 / month. What's the advantage of doing it this way as opposed to just putting $50 wherever you want?

If anything, doesn't this sort of encourage more CC use?

ETA: at least it seems cheap enough. $1 / month plus at most 0.5% of an account which could be a few hundred dollars, means you're spending just a few dollars per month for someone to charge you slightly more on your card and put it into an account for you. Seems like a really bad idea if you're carrying a balance.

Credit card use is awesome. My wife and I spend every penny we can on our joint Starwood Amex each month. We end up with boatloads of points and it will pay for family vacations. I set my Amex to autopay the full balance each month.

 

[Steve Tasker]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...

I signed up for a test account, and while I haven’t made any investments yet, I really like what I’ve seen of the app so far. It’s painless to set up, it seems very secure, and it’s cheap: you’re only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

One less thing to think about? For around one quarter of one percent, well worth not having to think about it.

I don't think about my spare change from CC purchases. How is this better than simply putting an additional 1-3% into your investment account?

I wasn't putting an additional 1-3% in my investment account.

ok. I might just be missing the point here.

Last month we used our main card 100 times which was slightly higher than usual due to back to school stuff. Presuming an average of 50 cents going into this account per transaction, that's $50 / month. What's the advantage of doing it this way as opposed to just putting $50 wherever you want?

If anything, doesn't this sort of encourage more CC use?

ETA: at least it seems cheap enough. $1 / month plus at most 0.5% of an account which could be a few hundred dollars, means you're spending just a few dollars per month for someone to charge you slightly more on your card and put it into an account for you. Seems like a really bad idea if you're carrying a balance.

I think it's primarily beneficial for people who otherwise wouldn't save or are new to saving. Most of the people in this thread are pretty financially savvy and probably wouldn't have a lot of use for it.

 

[mquinnjr]

Most of the well-known financial advisors advise against paying for your kids college. Personally I think it's something you should do if you can, but agree that if it is at the detriment of you own retirement, you shouldn't do it. Lots of stories of people who paid for their kids college and have almost nothing set aside for themselves.

Agree.

But the finest thing my dad did for me in life was to ensure i wasn't strapped with deep student loans out of the gate especially since i went to professional school.

I sincerely hope I'll be able to pay for most or all of my child's college as well... although it's going to be tougher as college prices keep soaring!

I started saving before the kid was even born though.. so i've got a head start.

Yeah, I feel like if I ever have a kid(s), a 529 plan is a must, and I'm trying to save like a mad man prior to that day because a lot will be diverted from my current traditional/Roth saving %'s to a 529 limit per annum/total.

 

[culdeus]

Maybe im alone here but i went the crummey (spemling?) trust route for my kids. Much more control over the funds and i can manage the taxes easily by shifting around indexes and target funds while steering clear of wash sale and all that.

529 fee structures didnt really do it for me.

 

[eaganwildcats]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...I signed up for a test account, and while I havent made any investments yet, I really like what Ive seen of the app so far. Its painless to set up, it seems very secure, and its cheap: youre only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

One less thing to think about? For around one quarter of one percent, well worth not having to think about it.

I don't think about my spare change from CC purchases. How is this better than simply putting an additional 1-3% into your investment account?

I wasn't putting an additional 1-3% in my investment account.

ok. I might just be missing the point here.

Last month we used our main card 100 times which was slightly higher than usual due to back to school stuff. Presuming an average of 50 cents going into this account per transaction, that's $50 / month. What's the advantage of doing it this way as opposed to just putting $50 wherever you want?

If anything, doesn't this sort of encourage more CC use?

ETA: at least it seems cheap enough. $1 / month plus at most 0.5% of an account which could be a few hundred dollars, means you're spending just a few dollars per month for someone to charge you slightly more on your card and put it into an account for you. Seems like a really bad idea if you're carrying a balance.

Credit card use is awesome. My wife and I spend every penny we can on our joint Starwood Amex each month. We end up with boatloads of points and it will pay for family vacations. I set my Amex to autopay the full balance each month.

In on this. Went back to the beginning of September and rounded up all the transactions. Was ~$31.

 

[Steve Tasker]

Maybe im alone here but i went the crummey (spemling?) trust route for my kids. Much more control over the funds and i can manage the taxes easily by shifting around indexes and target funds while steering clear of wash sale and all that.

529 fee structures didnt really do it for me.

You spelled it correctly. Crummey trust

 

[FUBAR]

You like investing? You like saving with with style?

Check this out, pretty neat. I think I might do this.

Interesting idea.

Good idea, but I don't like this part...I signed up for a test account, and while I havent made any investments yet, I really like what Ive seen of the app so far. Its painless to set up, it seems very secure, and its cheap: youre only charged after you invest, at which point, Acorn costs just $1 per month, plus a management fee ranging from 0.25% and 0.5% of the total assets in your account.

I think BOA's keep the change program is much better.

Great for people who don't already invest, but why pay someone to do something we can easily do ourselves? (the investing part, not rounding the change)

One less thing to think about? For around one quarter of one percent, well worth not having to think about it.

I don't think about my spare change from CC purchases. How is this better than simply putting an additional 1-3% into your investment account?

I wasn't putting an additional 1-3% in my investment account.

ok. I might just be missing the point here.

Last month we used our main card 100 times which was slightly higher than usual due to back to school stuff. Presuming an average of 50 cents going into this account per transaction, that's $50 / month. What's the advantage of doing it this way as opposed to just putting $50 wherever you want?

If anything, doesn't this sort of encourage more CC use?

ETA: at least it seems cheap enough. $1 / month plus at most 0.5% of an account which could be a few hundred dollars, means you're spending just a few dollars per month for someone to charge you slightly more on your card and put it into an account for you. Seems like a really bad idea if you're carrying a balance.

Credit card use is awesome. My wife and I spend every penny we can on our joint Starwood Amex each month. We end up with boatloads of points and it will pay for family vacations. I set my Amex to autopay the full balance each month.

We do the same for points, but still onlt on things we'd buy anyway.

It has an audience and if you and DD are in on it, it has to be decent.

If this adds to your points, maybe there's another benefit. Would have to do the math, but that might pay for the program.

 

[Steve Tasker]

I guess what I don't get about that Acorns program is that it just takes money that you would otherwise have and puts it in this account.

Say I make $20,000 of credit card purchases in a year, and let's say that my Acorns spending (with rounding up) totals $22,000. So Acorns has rounded up my $20,000 purchases to $22,000. I now have $2,000 in an Acorns account (?), paying a management fee and a small monthly fee. But if I don't use Acorns, I can just take that $2,000 that I still have in my bank account and put it in a Vanguard fund or something.

It does seem like a great dumbed-down investing tool for new investors or clueless investors. But I fail to see how it works for me .

 

[wilked]

I guess what I don't get about that Acorns program is that it just takes money that you would otherwise have and puts it in this account.

Say I make $20,000 of credit card purchases in a year, and let's say that my Acorns spending (with rounding up) totals $22,000. So Acorns has rounded up my $20,000 purchases to $22,000. I now have $2,000 in an Acorns account (?), paying a management fee and a small monthly fee. But if I don't use Acorns, I can just take that $2,000 that I still have in my bank account and put it in a Vanguard fund or something.

It does seem like a great dumbed-down investing tool for new investors or clueless investors. But I fail to see how it works for me .

exactly

 

[Otis]

I guess what I don't get about that Acorns program is that it just takes money that you would otherwise have and puts it in this account.

Say I make $20,000 of credit card purchases in a year, and let's say that my Acorns spending (with rounding up) totals $22,000. So Acorns has rounded up my $20,000 purchases to $22,000. I now have $2,000 in an Acorns account (?), paying a management fee and a small monthly fee. But if I don't use Acorns, I can just take that $2,000 that I still have in my bank account and put it in a Vanguard fund or something.

It does seem like a great dumbed-down investing tool for new investors or clueless investors. But I fail to see how it works for me .

For me it just seems like a really easy way to divert "pocket change" into something useful. Im not a great planner or saver, and any way I can hide savings in painless ways is a good thing.

 

[Dentist]

I guess what I don't get about that Acorns program is that it just takes money that you would otherwise have and puts it in this account.

Say I make $20,000 of credit card purchases in a year, and let's say that my Acorns spending (with rounding up) totals $22,000. So Acorns has rounded up my $20,000 purchases to $22,000. I now have $2,000 in an Acorns account (?), paying a management fee and a small monthly fee. But if I don't use Acorns, I can just take that $2,000 that I still have in my bank account and put it in a Vanguard fund or something.

It does seem like a great dumbed-down investing tool for new investors or clueless investors. But I fail to see how it works for me .

For me it just seems like a really easy way to divert "pocket change" into something useful. Im not a great planner or saver, and any way I can hide savings in painless ways is a good thing.

Are we still talking about pennies?

PENNIES?

Otis, even with your free wheel spending credit card swiping lifestyle we're talking about PENNIES... you're not even going to accumulate enough over the course of a quarter for a steak dinner.

This is absolutely ridiculous... we still talking about PENNIES?

 

[FUBAR]

I guess what I don't get about that Acorns program is that it just takes money that you would otherwise have and puts it in this account.

Say I make $20,000 of credit card purchases in a year, and let's say that my Acorns spending (with rounding up) totals $22,000. So Acorns has rounded up my $20,000 purchases to $22,000. I now have $2,000 in an Acorns account (?), paying a management fee and a small monthly fee. But if I don't use Acorns, I can just take that $2,000 that I still have in my bank account and put it in a Vanguard fund or something.

It does seem like a great dumbed-down investing tool for new investors or clueless investors. But I fail to see how it works for me .

For me it just seems like a really easy way to divert "pocket change" into something useful. Im not a great planner or saver, and any way I can hide savings in painless ways is a good thing.

There's the disconnect. There's no pocket change. All you're getting is a higher bill and the difference between what you would have paid and what you will pay gets put into an account you're probably spending the price of a small coffee to grande latte for each month.Unless you're getting additional points, you're better off looking at your bill and putting 1% of the total into another account.

 

[Otis]

I guess what I don't get about that Acorns program is that it just takes money that you would otherwise have and puts it in this account.

Say I make $20,000 of credit card purchases in a year, and let's say that my Acorns spending (with rounding up) totals $22,000. So Acorns has rounded up my $20,000 purchases to $22,000. I now have $2,000 in an Acorns account (?), paying a management fee and a small monthly fee. But if I don't use Acorns, I can just take that $2,000 that I still have in my bank account and put it in a Vanguard fund or something.

It does seem like a great dumbed-down investing tool for new investors or clueless investors. But I fail to see how it works for me .

For me it just seems like a really easy way to divert "pocket change" into something useful. Im not a great planner or saver, and any way I can hide savings in painless ways is a good thing.

Are we still talking about pennies?

PENNIES?

Otis, even with your free wheel spending credit card swiping lifestyle we're talking about PENNIES... you're not even going to accumulate enough over the course of a quarter for a steak dinner.

This is absolutely ridiculous... we still talking about PENNIES?

When those pennies end up 25k sitting in an account for use on a whim when I'm 60, it'll be all good

 

[eaganwildcats]

I guess what I don't get about that Acorns program is that it just takes money that you would otherwise have and puts it in this account.

Say I make $20,000 of credit card purchases in a year, and let's say that my Acorns spending (with rounding up) totals $22,000. So Acorns has rounded up my $20,000 purchases to $22,000. I now have $2,000 in an Acorns account (?), paying a management fee and a small monthly fee. But if I don't use Acorns, I can just take that $2,000 that I still have in my bank account and put it in a Vanguard fund or something.

It does seem like a great dumbed-down investing tool for new investors or clueless investors. But I fail to see how it works for me .

For me it just seems like a really easy way to divert "pocket change" into something useful. Im not a great planner or saver, and any way I can hide savings in painless ways is a good thing.

Are we still talking about pennies?

PENNIES?

Otis, even with your free wheel spending credit card swiping lifestyle we're talking about PENNIES... you're not even going to accumulate enough over the course of a quarter for a steak dinner.

This is absolutely ridiculous... we still talking about PENNIES?

When those pennies end up 25k sitting in an account for use on a whim when I'm 60, it'll be all good

Saving in a non-optimal way is better than not saving. This is basically the same reason why I got a 15 year mortgage and will be dumping more money toward my house than getting a 30 year and 'investing' the difference. I don't trust myself.

And it's more fun to see how these little transactions add up than just transferring the money each month.

 

[cstu]

Saving in a non-optimal way is better than not saving. This is basically the same reason why I got a 15 year mortgage and will be dumping more money toward my house than getting a 30 year and 'investing' the difference. I don't trust myself.

And it's more fun to see how these little transactions add up than just transferring the money each month.

I'll always be against this on pure principle, but if you know yourself then you gotta do what you gotta do.

 

[cstu]

I guess what I don't get about that Acorns program is that it just takes money that you would otherwise have and puts it in this account.

Say I make $20,000 of credit card purchases in a year, and let's say that my Acorns spending (with rounding up) totals $22,000. So Acorns has rounded up my $20,000 purchases to $22,000. I now have $2,000 in an Acorns account (?), paying a management fee and a small monthly fee. But if I don't use Acorns, I can just take that $2,000 that I still have in my bank account and put it in a Vanguard fund or something.

It does seem like a great dumbed-down investing tool for new investors or clueless investors. But I fail to see how it works for me .

For me it just seems like a really easy way to divert "pocket change" into something useful. Im not a great planner or saver, and any way I can hide savings in painless ways is a good thing.

Are we still talking about pennies?

PENNIES?

Otis, even with your free wheel spending credit card swiping lifestyle we're talking about PENNIES... you're not even going to accumulate enough over the course of a quarter for a steak dinner.

This is absolutely ridiculous... we still talking about PENNIES?

Woah, when Dentist has an issue with a method of saving money you know it's not worthwhile.

 

[Dentist]

This is an example of penny wise but most likely pound foolish behavior.