Good morning everyone!
Today is Tuesday.
And tomorrow, Tuesday will be gone…
And in a few weeks, we’ll be in December.
And in a few months, we’ll have freezing cold weather.
And in a few years, we’ll have changed jobs, our kids will be much older, and we’ll face other big life challenges.
And in a few decades, we will be completely different people with new habits, routines, and new friend groups.
And in a few centuries, well… we’ll all be dead.
Sooooo…. Since today will happen only once ☝️ (and everything will change starting tomorrow whether we like it or not), we should try to enjoy the here and now as much as possible, right?
➡️ Enjoy who you are.
➡️ Enjoy where you are.
➡️ Enjoy what you have.
OK, now let’s talk about some money stuff 👇👇👇
TO DO
Spend Your 2023 FSA Dollars ⛑️
If you have a healthcare FSA, you may have funds that will “expire” if you don’t spend them before the end of the year. Some plans offer rollover capabilities but the max rollover for FSA accounts is $610.
This week: Check your FSA balance. If you have a bunch of money above and beyond that rollover amount, spend it! The FSA Store is a great marketplace and so is Amazon’s dedicated FSA store. Don’t let your money evaporate!
BUDGETING
Basic Spending Guidelines 📝
There’s no shortage of money rules and guidelines to help simplify personal finance. But if you’re just starting out (or need a refresher) here are 5 primary prescriptions that apply to most folks… 👇👇👇
In regards to housing, this rule works for both renters and homeowners. Lenders often use the 28/36 rule (max 28% of gross income spent on mortgage/tax/ins, and a max of 36% on total debt service) to assess credit applications and approve mortgages. Having a higher ratio typically means that you’ve reached unsafe debt levels.
As for car costs, the lower you can get your car expenses, the better. It helps your wallet, your health, and the planet. Think of this 10% rule as a ceiling for your transportation costs every month too. That’s about all we have to say about that. 😅
Credit cards. It’s sad that carrying a balance from month to month has become “the norm“ for many folks. A recent survey found that 3 out of every 5 Americans (61%) have some amount of revolving credit card debt and 14% of folks admitted to missing at least one payment in 2023! As bad as the current state of affairs is, the goal for credit cards is and always always will be to have NO debt. If you are currently carrying a balance, throw everything you can at it.
Saving for retirement and e-funds is pretty self-explanatory. These rules exist to make sure you slowly build wealth over time while simultaneously protecting it along the way!
Keep in mind — With every rule of thumb there are exceptions and gray areas. Some folks might want or need a larger cash buffer. And if you want to retire early, you better be investing a higher percentage of your income! These guidelines can help light the way, but you are in control of your finances.
Related stuff:
- 📋 The Best Interest: 75 Personal Finance Rules of Thumb
- 💻 New HTM Blog: Budgeting with Variable Income
TOGETHER WITH ACORNS*
Round Up & Invest Your Spare Change 🌱
Acorns helps you save without thinking about it. Every day, it rounds up your spending transactions and saves/invests that spare change. You can build up an e-fund, begin investing for retirement, or even set up a gift account for your kids!
The average Acorns customer saves $166 within 4 months — all from rounding up spare change.
If you find it difficult to save and want to round up spare change in the background, get started with Acorns! 😉
TRAVEL
“Perfect Timing” for the Southwest Companion Pass 👩✈️
One of the coolest travel hacks around is earning the Southwest Companion pass — It basically let’s you have a “plus one” on every Southwest flight you take for a full year (or more).
Earning one is usually pretty hard — BUT, there is a well known shortcut (by combining 2 credit card welcome offers) and NOW is the best time of year to start the process… 👇👇👇
Why now is the best time to start:
When you earn the Southwest companion pass, it’s actually valid for the remainder of the current year plus the next full calendar year. For example, if you qualify in February 2024, then the companion pass expires in December 2025. That’s almost 2 full years (~22 months) of free companion travel!
By applying for Southwest credit cards now in November/December, you can time the welcome bonuses to land in January/February, maximizing the value of the incredible perk that is the companion pass.
Perfect timing in a nutshell:
- November/December: Apply and get approved for the Southwest Personal and/or Southwest Business credit cards. Don’t use the cards just yet! Remember, you want any and all points to start hitting your account in January.
- December/January: Your first billing statement will close (and will include the annual fee). NOW is the time to start using your card. The goal is to reach the minimum spend requirements so that the bonus points apply early in 2024, preferably January or February!
- January/February: Receive 75,000 + 60,000 points for personal and business cards (plus any regular spend point/multipliers) and qualify for the companion pass.
- The next 22 months: Fly as much as you can with your designated buddy! The companion pass will be valid for the remainder of 2024 and all 2025. You’ll be able to make copious memories on the cheap.
We’ve written a full blog post about this process here, with other important info you should know. If you’ve got a lot of travel planned for the next couple years (and you’re up for flying Southwest for much of it) check it out!
Warning: This method involves opening credit cards and qualifying for welcome bonuses. If you can’t handle credit responsibly, stay away from credit cards no matter how good the bonuses seem! Here are our golden rules of using plastic.
Related Stuff:
- 🛫 HTM Blog: Fastest Way to Earn the Southwest Companion Pass
ICYMI
What else is buzzing…
“Dupes” 🛍️
A new trend for Gen Z and Millennials — dupe shopping. Short for “duplicate”, dupes are basically cheaper alternatives to luxury or expensive brand-name items. As long as people aren’t buying crap they don’t need, we’re all for it!
Insurance 📈
Home insurance rates have been soaring this year, with some companies increasing premiums by up to 15%! If you have a policy renewing soon, brace yourself and add some padding to your sinking fund. Also, don’t forget to negotiate and shop around come renewal time!
Paperless 📲
Citi bank is serious about not mailing you paper bank statements anymore. How serious? Well, soon you won’t be able to log into your online account if you don’t agree to go paperless!
Stacking Benjis 🎙️
Last week Joel jumped on the Stacking Benjamins podcast for a roundtable with some other money experts. It was a great episode all about how happiness and life satisfaction change as we age.
Creative Benefits 👩💻
Employers across the globe are eager to hold onto their Gen X workers and are rolling out more creative benefits to retain them. It’s a cool trend we hope continues to grow!
FRIENDS OF HTM
RadCoaches — Rebecca and Dylan
Like many couples today, Rebecca and Dylan started their relationship in a messy financial situation. But, over time they focused on their communication, got on the same page about money, and began crushing it together!
Now, they teach other couples how to crush it! Their podcast — Rad Money — helps married millennials work as a team, better combine their finances and build a rich life.
We also interviewed them back on Episode 713, and you can check out all their info on their site, RadCoaches.
Welp, that’s it for now. Wishing you a great day ahead and enjoy every little moment. 🌻
Best friends out! 🍻
