Three Bears Financial

11/27/2024

When I talk personal finance with folks I start with three assumptions, and I'm right way more than I'm wrong:

1) You didn't get diddly squat for personal finance coursework in school (except DGF students!).

2) Your parents weren't awesome financial role models. Maybe they fought about money? Maybe they weren't financially responsible? Maybe they 'taxed' your income as a kid?

3) Someone in your circle, who you know and trust, is relatively well to do. Perhaps a rich uncle? Perhaps an aunt with Lego money? Perhaps an older cousin who has it going on? I'm willing to bet this person would be happy to share their wisdom with you IF you are willing to ask.

11/26/2024

Time to get back to posting content for Three Bears Financial.

Three years in, maybe 100 meetings, maybe sat down with 30 folks, no regrets.

My outstanding challenge is how to motivate people to track their spending. Old school. Pen and paper for a few months.

Most common thing I hear is: "My banking is online so I can see every transaction." Second place: "I have an app for that." These aren't the same as tracking spending, and I have yet to find the ideal way to deliver the message.

Perhaps I need a fancy infographic with a testimonial. I recently sat down with a client who told me they found an extra $600 in their account at the end of the month, simply because they started to track their spend. Six Hundred Dollars, for the cost of a pen and a used notebook.

11/29/2022

09/11/2022

Heads Up!

A guy named Ian (from Bismarck?) reached out with a three pronged business scam. I don’t think Ian is a bad guy, I think he’s been given some pretty crappy business advice.

His approach was 3 pronged:
1) Forex trading
2) Multi-level-marketing
3) Hedge fund investing

Forex trading is for professionals. If you can tell me if the Euro will be stronger or weaker vs the Yen next week you might be OK at Forex trading. If not, it’s not for you.

You’ve never heard me recommend MLMs. Sure, a small handful of people do VERY well with them…and that’s the guy who starts it and his close friends. MLMs are Ponzi schemes that have found loopholes in the law, they aren’t legitimate businesses.

Legitimate Hedge fund investing is available to what the SEC calls ‘accredited investors’. Accredited investors have $1M of investable assets (not counting their primary residence), and a incomes of $200k per year. A few of my FB peeps fall into this category, but most of us don’t.

This scam involves a company called NovatechFX through Super Nova Earning On Automation. It’s a scam promising 3% return in investment PER WEEK!

If I thought Ian was a crook I’d light him up. I’m fairly certain he’s an honest guy that got taken advantage of. Please find a competent financial professional if you hear from him.

Reminder: never take financial or investing advise from some guy you meet on the internet.

07/16/2022

Credit cards: I don’t care if you use them, I care that you use them well. I care that your credit card usage is a reflection of what you tell me is important to you.

Uncle Dave says credit cards are evil, they certainly can be problematic for some folks. Other Personal Finance voices receive content sponsorship for shilling certain credit card brands. How does a person know what’s best for them?

Let's start with the easy part: Are your credit card balances paid to zero at least once a month? If so: awesome! Keep doing what you are doing. No point in cutting cards that are working for you.

On the other hand, if you have an ongoing balance you are paying interest on, let's take a look at a few things. It’s probably a sign that at one point you were spending more than you were earning, and that’s not sustainable. I’d much rather see you spending the amount you are paying on interest and using those same dollars on something that brings you joy and helps you reach your goals.

If you have a maxed out card you would do well to see that as a red flag that something needs to change. If you have several maxed out cards the universe is telling you something.

What works for me:

- I have a debit card I use for my daily spend, 95% of my spend hits this card. My JunkYard and Caribou habits as well as Amazon, fuel, groceries, restaurants all hit this. I track my spending every Sunday morning, assigning each purchase to a budget category.

- I got a big bank credit card ahead of my international travels so if something went wrong I wouldn’t blow up the checking account my wife and I share. Once a year or so I charge a thing to it so the account has some activity and the card remains active on my credit report.

- After seeing Menards happens 3 Saturdays a month I got a Menards store card. It provides a bit of store credit back and I pay the balance down to zero every Sunday. My spending habits make clear this ‘cash’ back reward will be used on the first Saturday it becomes available.

- By and large I have learned I am not responsible enough to keep cash on my person. Any cash I have is used for tipping and I quite frankly suck at keeping cash accounted for in the budget. Catch me on the street and it’s almost certain I’ll have less than $10 on me.

What works for you?

What rewards does your card claim it offers?

What tangible reward have you actually used with that card?

Feel free to reach out if you want to sit down for a no-judgment conversation about what is and what isn’t working with your credit card situation.

Disclaimer: Never take investment or airline rewards advice from some guy you meet on the internet.

07/10/2022

A week ago I set out to learn how TikTok might work for reaching my target demographic.

The only thing I knew is people my age aren’t allowed to create content for the platform. Any attempt to create content by people over 50 comes off as cringe, regardless of how we might believe it would look. But, we can make our profiles public and anyone can creep my page to see which Personal Finance pros I think have a clue. So far I’ve ‘liked’ about 40 videos and will probably like hundreds more in the future. No, I won’t be creating any content on my own for this platform.

WARNING: By watching the GOOD personal finance videos my ‘For You’ has been flooded with videos trying to get me to sign for any number of scams. You’ll notice I don’t advocate for things like: universal life insurance, leveraging debt, multi-level marketing, airbnb rentals, affiliate marketing, NFTs, crypto, or selling pictures of your feet.

The GOOD stuff includes: Tracking spending, setting up an emergency fund, paying off debt, getting the company match in your 401K, maxing out your Roth IRA with index funds, spending less than you earn, and putting savings on autopilot.

You can find me with this QR code of search for the project name: threebearsfinancial

Next week: Instagram.

Disclaimer: Never take content creation or investing advice from someone you meet on the internet.

07/02/2022

Can we agree that opinions once expressed in editorial cartoons are often expressed in meme format today? A cartoon, often a caricature, intended to demonstrate a truth but not the full truth?

Can we agree to use the meme as a starting point for personal finance literacy, without getting too wrapped around the emotional response the meme artist was paid to provoke?

Let's start with this stairwell. What seems true to you? What seems misplaced?

Wages that don’t keep up with inflation is a problem, but it’s also a reason to double down on learning personal finance.

Crippling student loan debt and rent are real things. Let’s use this ball and chain as a springboard to talk about how much you can afford to spend on housing. Experts recommend 30% of gross income going towards ‘housing’. If your ‘housing’ (rent + utilities) is more than 30% of your gross income you are bound to feel broke most of the time and also likely to fall into credit card debt.

Let's turn our attention to the first step up the hill: Buying a vehicle: 20% down, no more than 36 monthly payments, payments at about 8% of your net income. Go over those limits and you’ll again likely feel broke and may well end up in credit card debt.

Next step in the meme: Starting a family. Just do it. No one can afford kids. Everyone with kids feels broke. Starting a family isn’t a financial step.

Home ownership: Meh. A couple generations ago home ownership was the primary investment for many people, becoming their largest financial asset. Nowadays home ownership is more of a lifestyle choice than an economic requirement. Want to own, own. Want to rent, rent. Again 30% of gross going towards ‘housing’. If your current rental arrangement has extra room below the 30% threshold consider investing that money for the down-payment on a future house.

Starting a business. Meh. There are folks who should probably be starting a business. Given that something like 45% of small businesses fail in the first 5 years, and 96% fail in the first 10 years, let's think long and hard before going down that path.

Pay off all debt. Yuppers, in stages. Maybe you want to use the ‘debt snowball’? Maybe you prefer the ‘debt avalanche’. My preference is to start with the debt that makes you puke a little bit when you think about it. High interest credit cards are going to need to be paid off pretty early in the game. Cars and toys (boat, motorcycle, RV, snowmobile) are going to need to get paid off shortly thereafter. I enjoy having a paid off mortgage and there are financial experts on both sides of this one. If you keep your mortgage or pay it off early is more of an emotional choice than a financial one. Either way you’ll want the mortgage gone before retirement starts.

Emergency Fund. This is the first step for most people. Start with $100, it’s a start. Keep going until you get enough to pay for a car repair or unexpected trip to the emergency vet. Some experts say a starter Emergency Fund should be $1K, others say $2K, others say ‘enough to cover your deductibles’. The exact amount is up to you, but should be enough that the ripples of life don’t upset the journey. Once the starter Emergency Fund is in place, and high interest credit cards are paid off, let’s get you going on a legit Emergency Fund: 3 month’s spend on the short side, 6 months for most people, 8 months for single wage earners.

Nice Vacation. Doable, about 2 years out. Once your debts are paid off you’ll find that you have money to save for things like Nice Vacations.

Luxury Dining. What is this exactly? I see it as part of a nice vacation and have never seen it listed as a financial step.

Traveling Abroad. How is that different from ‘nice vacation'?

Happy to sit down with anyone over coffee or a beer to talk about personal finance and help you become the Hero of your own personal finance journey.

06/19/2022

Looked into starting a new savings account at WellsFargo, was impressed to see they offer a "Relationship Interest Rate" that is double their Standard Interest Rate.
02% is their Relationship rate.

I'd need to have $100,000 in their bank for a year to earn enough to buy a tube of KY l**e. I think the customer is gonna get screwed in this relationship.

06/01/2022

Let’s get one thing straight: I don’t care if you are!

I am perfectly happy to help straights, g**s, and everyone else sort out their finances.

Single? Married? Divorced? Separated? Partnered? Poly?

Personal Finance is agnostic of orientation or lifestyle. There is a chance your relationship status will surprise me, but the odds are against.

05/31/2022

How would you grade yourself on your Personal Finance knowledge?

Try these True \ False questions and see how you do:
T \ F All of my bills get paid on time each month.
T \ F I use an effective budget.
T \ F I stick to a written list at the grocery store and Target.
T \ F I have a dedicated Emergency Fund in place.
T \ F I have 15% of my gross income going into retirement investments.

How did you do? 5 for 5? 0 for 5? Somewhere in the middle?

Feel free to reach out for pointers to raise both your score and your confidence with Personal Finance.

05/13/2022

My $40 crypto investment experiment from a few months ago is now worth $20.64, essentially cut in half.

The Personal Finance voices I listen to suggest investing no more than 3% of your financial net worth in speculative asset classes.

To those who invested big in Crypto: I am sorry.

To those who wanted to invest but couldn't afford to: This is a great time to look around and learn how these kinds of asset classes behave in good times and in bad.

To those who invested a little bit in Crypto: Wise choice!

*Disclaimer: never take pickle flavor recommendations, or investment advice, from some guy you met on Facebook.