By Mike Piper8 Comments – The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited January 10, 2014.
People often ask me to point them to a decent online retirement planning calculator. I never do.
You see, I don’t trust such calculators.
It’s not that their math is wrong. (At least, not usually.) The problem is that their calculations are often based on shoddy assumptions and unknowable variables.
You Know What They Say about Assuming…
For example, what rate of return does the calculator assume for your portfolio? Is it reasonable? Or, perhaps, was the calculator programmed to assume that future returns will equal past returns (thereby ignoring the possibility that the U.S. economy won’t have the same explosive growth over the next century that it did over the last)?
And what assumptions does the calculator make about future tax rates? From what I’ve seen, most calculators assume that either:
All income will be taxed at a flat rate (usually 25% or 28%), or
Tax brackets will continue to look the same as the 2013 tax brackets all the way into the future.
While I certainly don’t know what tax rates will look like three decades from now, I doubt that either of one of those assumptions will turn out to be correct.
And does the calculator account for sequence of returns risk? A portfolio averaging a 5% annual return is very different from earning a 5% return every year. If the calculator doesn’t account for that fact, it’s going to significantly underestimate the amount of money you’ll need to retire safely.
What’s Better than an Online Calculator?
If you’ve taken the time to educate yourself about investing, then you probably don’t need an online calculator. A simple excel spreadsheet will function at least as well. (And you get to choose your own assumptions!)
Alternatively, if you haven’t taken the time to learn about investing, there’s no way for you to judge whether the assumptions that went into the calculator’s projections are reasonable.
In other words, there are two routes you can take:
If you want to be a do-it-yourself investor, super. But rather than rely on online calculators, you’ll need a deeper level of understanding if you want to be successful.
If you don’t want to go it alone, that’s fine too. But in that case, an online calculator isn’t what you need. What you need is a qualified financial advisor.
In my opinion, such calculators are only useful for young investors who are so far away from retirement that none of the relevant variables are known yet. In other words, a completely blind guess from a calculator is almost as good as one from an advisor.
About the Author: Mike Piper writes at Oblivious Investor, where he provides plain-English explanations of topics like Roth IRA rules and 401k rollovers.
By Peter Anderson11 Comments – The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited December 15, 2011.
The Roth IRA is a wonderful investment option that many people take advantage of every year mainly because of it’s tax free growth and because it allows you to diversify your tax situation at retirement if you also invest in some pre-tax investment types like a 401k or IRA.
While the ideal situation is to max out your contributions to your Roth IRA every year, and then not take any money out until retirement, sometimes you might find yourself in a situation where you need money now – before the usual distribution age of 59 1/2. Luckily the Roth IRA is one of the more flexible retirement account types and withdrawing your contributions (or the money you put in) can be done tax and penalty free at any time.
You do need to be careful, however, that you understand when and how you are allowed to withdraw your earnings (the interest you earn on your contributions) – before your retirement age, because if you’re not careful you could be subject to a 10% early withdrawal penalty by the IRS, and be taxed at your normal tax rate.
When Can You Make A Roth IRA Withdrawal?
Again, as mentioned above you can usually make a withdrawal of your principle contributions at any time. The earnings off of your principle can’t be withdrawn until you reach the age of 59 1/2 without paying a 10% early withdrawal penalty. No one wants to pay that. There is also one proviso on being able to withdraw your earnings after 59 1/2 – it’s called the 5 year rule.
Roth IRA 5 Year Rule
You can only withdraw your earnings from your Roth IRA at 59 1/2 and have them count as qualified distributions if it has been at least 5 years since your Roth IRA account was opened. For example, if you opened your account at 56, you would need to wait until you were 61 with withdraw any earnings on your principle.
Qualified Reasons For Roth IRA Distribution
Here are the main reasons you can receive a distribution from your Roth IRA without taxes or penalties:
You are age 59½ or older.
The distribution was made to your beneficiary after your death. (too bad for you – you’re dead!)
You are using the money to buy a home, and are a first-time homebuyer ($10,000 lifetime maximum per account)
You’re disabled.
Other Exceptions to 10% Penalty
Sometimes you may still need to take a distribution from your Roth IRA for a non-qualifying reason. You can still get around the 10% early withdrawal penalty (while still paying income taxes) if you find yourself in any of these situations:
You have un-reimbursed medical expenses that exceed 7.5% of your adjusted gross income.
You are paying medical insurance premiums after losing your job.
The distributions are not more than your qualified higher education expenses. (pay for schooling!)
The distribution is due to an IRS levy of the qualified plan.
The distribution is a qualified reservist distribution.
The distribution is a qualified disaster recovery assistance distribution.
The distribution is a qualified recovery assistance distribution.
Order Of Roth IRA Distributions
When withdrawing your money the distributions come out in this order according to IRS publication 590
Regular contributions.
Conversion and rollover contributions, on a first-in-first-out basis (generally, total conversions and rollovers from the earliest year first). Take these conversion and rollover contributions into account as follows:
Taxable portion (the amount required to be included in gross income because of the conversion or rollover) first, and then the
Nontaxable portion.
Earnings on contributions.
So as you can see the order of distributions is setup in order to help you avoid paying fees or penalties. Your contributions (tax and penalty free) come out first. Next come conversion or rollover amounts followed by earnings on your contributions – which could be assessed penalties if not a qualified distribution.
Conclusion – Don’t Withdraw Until Retirement
So as you can see there are ways that you can withdraw money from your Roth IRA without having to worry about paying taxes or penalties on your money. The question remains, however, as to whether or not it’s a good idea. The whole point of a retirement account is to have the money going in, growing tax free using the power of compound interest – and withdrawing the money short circuits that whole process. My suggestion? Do your best not to take any money out, but if you do, make sure it’s for a qualified reason.
Good luck!
Have you taken an early withdrawals from your Roth IRA? Have you had to pay any penalties or taxes on that money? Have you considered using it to buy your first home or pay for your or your children’s education? Tell us your thoughts in the comments.
By Peter Anderson10 Comments – The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited November 6, 2018.
A while back I wrote an article about 401k loans and taking early withdrawals from your retirement account. I talked about the penalties you could face, and explained why I think it’s a bad idea.
This week I was reading some economic news and came upon an article on Reuters.com that gives a startling statistic – that nearly a quarter of Fidelity’s 401(k) accounts have a loan against them.
A record number of U.S. workers are tapping into their retirement accounts to make it through the economic downturn, Fidelity Investments found in a survey released on Friday.
Among the 11 million workers whose 401(k) plans are run by Fidelity, 11 percent took out a loan from their plan during the 12 months ended June 30, the company said, up from 9 percent at the same point a year earlier.
By the end of the second quarter, plan participants with loans outstanding against their 401(k) accounts had reached 22 percent versus 20 percent a year earlier.
To me it’s crazy that of the 11 million 401(k) plans being run by Fidelity, almost 2.5 million of them have outstanding loans. Do all these people realize the penalties they could face if they lose their job and have to repay it immediately? Or is this just a sign that times are tough, and a continuing indicator that people aren’t planning ahead for emergencies, and are living in the now?
During the quarter, 2.2 pct of Fidelity’s active 401(k) participants took a hardship withdrawal, up from 2 percent a year earlier, and another peak, Fidelity said.
Often those withdrawals were used to prevent foreclosure on a home or pay college tuition.
“People have been looking to their 401(k) plans as a source of relief to help them meet financial hardships,” said Beth McHugh, a Fidelity vice president who oversees the area. “For many individuals that is their primary savings vehicle.”
Loans and withdrawals were highest among workers between 35 to 55 years old, Fidelity found, peak earnings years.
So more people are taking out loans and hardship withdrawals from their 401(k) than ever before.
Fidelity found signs of continued thrift in the workforce. The average percentage of salary saved in a 401(k) held steady at 8 percent, similar to the rate in the first quarter, while 32 percent saved 10 percent or more of their pay.
But the rising rates of loans and withdrawals show more people have turned to their savings to cover basic expenses, McHugh said. She added that second-quarter rates tend to be higher as parents look for ways to cover college tuition.
The good news is that they do see people continuing to save money in their 401(k), but in the end many of them are turning to their retirement accounts to cover even the basics – and many of them are actually taking 401k loans out to pay for their child’s education. I’d argue that this is a mistake. The child can always take out a loan, get scholarships or do other things to help pay for their own education. But short circuiting your retirement and possible gains by reducing your balance could hurt your later on – you can’t replace those gains and the compounding interest later on!
Why Taking Out A 401k Loan Is A Bad Idea
When taking out a 401k loan, usually you can borrow up to 50% of your vested account balance or $50,000, whichever is less. In most circumstances you have a maximum of five years to repay the loan, unless you are borrowing for a first home, which allows a longer payback.
I’ve written about it more than once on this site, but I think taking out 401k loans is usually a bad idea – only to be done in the worst of circumstances. Unfortunately too many people are using them to just pay off debt, buy a new car, or pay for other wants or needs, instead of taking out a loan with their local bank. Why not pay theirselves interest instead of the bank? There are quite a few good reasons why not.
You May Have To Repay Your 401k Loan Immediately If You Move Jobs Or Are Fired: One thing people don’t consider in this unsure environment is that they could lose their job and end up having to pay back their 401k loan immediately – when they can least afford to. Many plans offer a 60-90 day grace period to repay the loan, but is that really enough on a large loan of thousands of dollars?
Subject To Taxes And Penalties If Not Repaid In Time: If the loan isn’t repaid, there will be a 10% penalty, and federal and state taxes are taken out as well.
If Your Stocks Are Currently Down, You Short Circuit Possibility Of Regaining Stock Value: If you withdrew your money when the market was down, you won’t be able to regain those losses when the market goes back up.
For many people if they find themselves in a situation where they have to repay a loan, and they don’t have the money, they may be better off taking out a loan at a bank to repay the loan – and avoid those penalties and taxes. And because they have to take out a loan with most likely end up paying a higher interest rate.
So what do you think about the high rate of 401k loans, and early withdrawals? Do you think they represent a good opportunity to pay yourself interest, or are the risks associated with them too high? Would you take out a 401k loan to pay for your child’s education? Tell us your thoughts in the comments.
As Christians, we are called to be good stewards over the money and wealth with which God has provided to us.
So before we consider investing in stocks, we must find out if it is within God’s will!
Is investing in stocks a God-honoring way to grow our finances, or is it really being careless with God’s money?
What Is Investing In Stocks?
What Investing Is Not
Investing is not the same as gambling! This is actually where a lot of Christians develop a fear of the stock market. Most people who make this assumption do so either out of fear or ignorance. Some are fearful of investing because it seems so complicated, so they assume that no one can understand it and so everyone must be gambling! Others just don’t understand the mechanics of investing, or how much information is available to the common investor. It is beyond the scope of this article to catalog all of the ways in which investing is not gambling. Visit here to learn if the trading websites are legal and licensed.
True investing is not a “get rich quick scheme”. The bible is full of warnings about rushing to make money without any effort such as Proverbs 21:5
The plans of the diligent lead surely to advantage, but everyone who is hasty comes surely to poverty.
However, the concept of investing is not about throwing your money after something that you don’t really understand, hastily and without a real plan.
What Investing Is
The basic idea of investing in stocks is this: To participate in and benefit from the growth and earnings of a particular company, through purchasing shares of ownership. When someone has extra money and they want to look for legal ways to make that money grow, that is considered investing. The stock market gives individuals the unique opportunity to profit off of the growth and ingenuity of some of the world’s largest companies!
Does Investing In Stocks Show A Lack Of Faith In God?
Now that we have taken a very brief look at what investing is and isn’t, we now must consider whether someone who invests is demonstrating a lack of faith. Matthew 10:5-11:1 is a common passage that is brought up whenever discussing planning for the future, and trusting in God. This is where Jesus sends out his 12 Apostles to preach His word, heal the sick, and perform various miracles throughout Israel.
He gives them instructions on where to go, what to do, and dangers to look out for (and even uses this time to talk about future things). However it is Jesus’ instructions on what items to take along for the journey, that we want to take a look at now…Matthew 10:9-10 says:
Do not acquire gold, or silver, or copper for your money belts, or a bag for your journey, or even two coats, or sandals, or a staff; for the worker is worthy of his support.
As we see here, Christ was teaching them to trust in the Lord for all provision and care. This would be experienced through the kindness of those to whom they ministered in these various towns. They were not to take extra materials with them (planning for their future need), because God would work things out so that they would have all that they need!
This should be a great encouragement to us as believers because we know that God is able to provide for us no matter what our current situation may be.
However, there is something that we need to take notice of when considering this passage. First, Jesus’ words to the apostles were specific for this journey. We can see that from looking at His words to these same men in Luke 22:35-36
And He said to them, When I sent you out without money belt and bag and sandals, you did not lack anything, did you?” They said, “No, nothing”. And He said to them, “But now, whoever has a money belt is to take it along, likewise also a bag, and whoever has no sword is to sell his coat and buy one”.
He is now telling them to use normal means to provide for themselves (storing and planing for the future, buying, selling, etc), rather than just to go out with the bare minimum and count on God’s providence in a more pronounced way (as in the Matthew 10 passage).
This passage in Luke 22 is describing Jesus Christ’s last words to his disciples before he was crucified. He was giving them instructions on how to carry out God’s mission for them after His death. Therefore, it is clear that God was not condemning the concepts of investing, saving, and preparing for the future in Matthew 10, because he then instructs the disciples to make these concepts a part of their lives at the end of His earthly ministry.
So based on a proper understanding of God’s intention when sending the apostles out to preach, we can see that the ideas of investing and faith do not contradict one another.
Another idea that is often brought up is that of God’s general promise of provision negates the need to invest or plan for the future. In Matthew 6:25-33 we find these words:
25 “Therefore I tell you, do not worry about your life, what you will eat or drink; or about your body, what you will wear. Is not life more than food, and the body more than clothes? 26 Look at the birds of the air; they do not sow or reap or store away in barns, and yet your heavenly Father feeds them. Are you not much more valuable than they? 27 Can any one of you by worrying add a single hour to your life?
28 “And why do you worry about clothes? See how the flowers of the field grow. They do not labor or spin. 29 Yet I tell you that not even Solomon in all his splendor was dressed like one of these. 30 If that is how God clothes the grass of the field, which is here today and tomorrow is thrown into the fire, will he not much more clothe you—you of little faith? 31 So do not worry, saying, ‘What shall we eat?’ or ‘What shall we drink?’ or ‘What shall we wear?’ 32 For the pagans run after all these things, and your heavenly Father knows that you need them. 33 But seek first his kingdom and his righteousness, and all these things will be given to you as well.
Matthew 6:25-33
…But we urge you, brethren, to excel still more, and to make it your ambition to lead a quiet life and attend to your own business and work with your hands, just as we commanded you, so that you will behave properly toward outsiders and not be in any need.
1 Thessalonians 4:10b-12
For even when we were with you, we used to give you this order: if anyone is not willing to work, then he is not to eat, either. For we hear that some among you are leading an undisciplined life, doing no work at all, but acting like busybodies. Now such persons we command and exhort in the Lord Jesus Christ to work in quiet fashion and eat their own bread.
2 Thessalonians 3:10-12
As we can see, God’s normal way of provision is to line up your abilities with someone who is willing to pay for those abilities, so you can work to support yourself. The ideas of God sustaining us and our human efforts go hand in hand. However, we must be certain to look to God not even Solomon in all his glory clothed himself like one of these.
30″But if God so clothes the grass of the field, which is alive today and tomorrow is thrown into the furnace, will He not much more clothe you? You of little faith! 31″Do not worry then, saying, ‘What will we eat?’ or ‘What will we drink?’ or ‘What will we wear for clothing?’ 32″For the Gentiles eagerly seek all these things; for your heavenly Father knows that you need all these things. 33 “But seek first His kingdom and His righteousness, and all these things will be added to you.
As you can see, Jesus tells his followers not to worry since God will provide the basic necessities of life – if He does it for birds and flowers, He will surely do it for His children (those who seek after His kingdom)! However, this passage does not promote a sinful life of laziness, where we just sit around and pray and read the Bible, and food, money, shelter, and all of our other needs will just fall from the sky. Even the birds have to work to build nests, find food and care for their young, but ultimately, it is God who provides for them all.
God’s provision means a lot more than just raining down the things that we need without us doing any work for them. God oftentimes will provide for us by giving us the ability to earn money – for at all times for His sovereign will to be done in our lives!
Of course, there are more things that can be said about how those common verses that are used to teach that investing and planning for the future is equal to lacking faith in God, don’t teach that at all. However, I think that we’ve seen enough from God’s word to make that clear. Let’s move on to the main question at hand.
What Does The Bible Say About Saving And Investing?
The bible actually has quite a bit to say about investing for the future, but I just want to look at one main example and then give a few verses as well. Let’s take a look at the “Parable of the Talents” to see what God has to say about investing:
14″For it is just like a man about to go on a journey, who called his own slaves and entrusted his possessions to them. 15″To one he gave five talents, to another, two, and to another, one, each according to his own ability; and he went on his journey. 16″Immediately the one who had received the five talents went and traded with them, and gained five more talents. 17″In the same manner the one who had received the two talents gained two more.
18″But he who received the one talent went away, and dug a hole in the ground and hid his master’s money. 19″Now after a long time the master of those slaves came and settled accounts with them. 20″The one who had received the five talents came up and brought five more talents, saying, ‘Master, you entrusted five talents to me. See, I have gained five more talents.’ 21″His master said to him, ‘Well done, good and faithful slave You were faithful with a few things, I will put you in charge of many things; enter into the joy of your master.’
22″Also the one who had received the two talents came up and said, ‘Master, you entrusted two talents to me. See, I have gained two more talents.’ 23″His master said to him, ‘Well done, good and faithful slave. You were faithful with a few things, I will put you in charge of many things; enter into the joy of your master.’ 24″And the one also who had received the one talent came up and said, ‘Master, I knew you to be a hard man, reaping where you did not sow and gathering where you scattered no seed. 25’And I was afraid, and went away and hid your talent in the ground. See, you have what is yours.’
26″But his master answered and said to him, ‘You wicked, lazy slave, you knew that I reap where I did not sow and gather where I scattered no seed. 27’Then you ought to have put my money in the bank, and on my arrival I would have received my money back with interest. 28’Therefore take away the talent from him, and give it to the one who has the ten talents.’
29″For to everyone who has, more shall be given, and he will have an abundance; but from the one who does not have, even what he does have shall be taken away. 30″Throw out the worthless slave into the outer darkness; in that place there will be weeping and gnashing of teeth. ~ Matthew 25:14-30
I believe this to be the clearest picture of investing what God has given us in order to bear fruit for His kingdom. The fact that Jesus actually uses money to illustrate this point, should be a clear indication that God has no problem with Christians who take the money that God has given us responsibility over, and wisely invests it! In fact, he expects it!
To be clear, this passage goes way beyond money and points to whatever talents and spiritual gifts we have. The point is that God expects us to use what He gives us, and it is, therefore, a sin to bury them in the ground and fail to use it. Because of our economic system, money is the thing that we use in order to sustain ourselves. In times of surplus, we are to give abundantly and invest and save for the future, so that in times of lack, we will have provision stored up for us!
This was true in Egypt when God led Joseph to plan to save 20% of the harvest for 7 years in preparation of the devastating famine (Genesis 41:33-36). We can also see it in the rebuke of the lazy man in Proverbs 6:6-11:
6 Go to the ant, O sluggard, Observe her ways and be wise, 7 Which, having no chief, officer or ruler, 8 Prepares her food in the summer and gathers her provision in the harvest. 9 How long will you lie down, O sluggard? When will you arise from your sleep? 10 “A little sleep, a little slumber, A little folding of the hands to rest”– 11 Your poverty will come in like a vagabond, and your need like an armed man.
Here are a few more verses about saving and planning & investing for the future:
Proverbs 10:5 – He who gathers in summer is a son who acts wisely, but he who sleeps in harvest is a son who acts shamefully.
Proverbs 21:5 – The plans of the diligent lead surely to advantage, but everyone who is hasty comes surely to poverty.
Proverbs 24:27 – Prepare your work outside and make it ready for yourself in the field; Afterwards, then, build your house.
Luke 14:28-30 – For which one of you, when he has laid a foundation and is not able to finish, all who observe it begin to ridicule him, saying, ‘This man began to build and was not able to finish.’
1 Chronicles 22:5 – David said, “My son Solomon is young and inexperienced, and the house that is to be built for the Lord shall be exceedingly magnificent, famous and glorious throughout all lands. Therefore now I will make preparation for it.” So David made ample preparations before his death.
As you can see, God has a lot to say about planning and investing for the future.
Reader Questions:
Why do you think the bible speaks about finances and planning for the future so often?
Do you allow God’s word to impact your investing decisions?
By Peter Anderson1 Comment – The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited August 25, 2011.
Over the past few years of personal finance blogging one of the companies that I’ve heard recommended time and again as one of the best places to invest is Vanguard. The reasons why people love them so much include the facts that they have low costs as compared to so many other companies, they offer a diverse set of index funds to choose from, and even some of their actively managed funds are super affordable when compared to the competition.
Another thing that a lot of folks like is that it is relatively easy to buy into mutual funds at Vanguard with low initial mutual fund investments. Most vanguard funds with exceptions of one, the Vanguard STAR® Fund (which had a $1,000 minimum) had initial investments of around $3000. This past week Vanguard announced that they were lowering the initial investments for a wider range of funds to $1000 in order to make investing with Vanguard that much easier. In addition a variety of other funds have had their fund minimum lowered to $3000.
Vanguard Lowers Target Retirement Fund Minimums
Vanguard announced that they were lowering their fund minimums for their Target Retirement Funds last week, as well as reducing and standardizing minimums for other fund types.
To help investors take the first step toward a more financially secure retirement, we’re lowering the minimum initial investment for our popular Target Retirement Fund series from $3,000 to $1,000, effective immediately. Previously, only one of our funds, Vanguard STAR® Fund, had a $1,000 minimum.
“Investing early and investing regularly are two of the most important things investors can do to help ensure their retirement readiness,” said Vanguard CEO Bill McNabb. “By reducing the investment requirements for our target-date funds, we hope to encourage more individuals to participate in the financial markets.”
In addition, Vanguard is standardizing the minimum investment for Investor Shares of nearly all our other funds at $3,000. Previously, fund minimums for the affected funds ranged from $3,000 to $25,000. This change reduces the minimum investment for 15 Vanguard funds, including some of our oldest and largest actively managed funds, such as the Wellington™ Fund, Windsor™ II Fund, and Health Care Fund.
Target Retirement Funds Affected
Here’s a list of the Target Retirement Funds affected by the lowered minimums:
Target Retirement 2010
Target Retirement 2015
Target Retirement 2020
Target Retirement 2025
Target Retirement 2030
Target Retirement 2035
Target Retirement 2040
Target Retirement 2045
Target Retirement 2050
Target Retirement 2055
Vanguard Now Even Friendlier For Newer Investors
Vanguard has been known as a friendly place for newer and experienced investors alike, but I think that this move will most likely be one that ingratiates them even more to the newer investors who previously may not have had the $3000 to start an account. $1000 is that much more accessible to newer investors who just want to test the waters and get started investing – even if they don’t have a ton of money to work with.
As Vanguard mentions in their post – investing early and regularly are two very important pieces of the puzzle – and this move will most likely help a lot more people to get started earlier. I think I’ve mentioned in the past that I wished Vanguard would reduce the minimums on their funds – especially the target retirement funds. Others including Mike at obliviousinvestor.com has also written about how they wished Vanguard would get rid of minimums to make their funds more accessible. Now they have, and I’m sure investors everywhere are happy with the change. I know I am.
What do you think? Are you more likely to invest with Vanguard now that they’ve reduced their minimums for so many of their account types? Do you use Vanguard? Tell us your experience in the comments!
By Peter Anderson8 Comments – The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited May 29, 2023.
Memorial Day is here! It’s become synonymous with being a day to enjoy family, friends and even a having a BBQ, but let’s not forget to take a moment today to remember all our fighting men and women over the years who have made the ultimate sacrifice, by giving their lives so that the rest of us might live free.
Over the years on Memorial Day I’ve had a chance to stop at my grandparent’s graves at Fort Snelling National Cemetery in Bloomington, MN.
While I won’t make it there this year, it is always a vivid reminder of just how much so many have given. There is row after row of graves for our military men and women, so many of them having died while fighting for our nation.
A couple of times while I was there I found the graves of Medal of Honor winners there, and it was amazing to read of their sacrifices later on when I got home via a Google search.
My Grandfather’s POW Story
Being at Fort Snelling also reminds me of just how much my grandfather gave, despite the fact that he wasn’t killed in action. My grandfather, Fred Anderson, was in the U.S. Army Air Corps, becoming a prisoner of war in a German POW camp for over a year. What he went through couldn’t have been easy, and I’m just sad that he passed at such a young age (in his 60s) due to Parkinson’s Disease and a stroke. I was never really able to get a full accounting of his experiences as I would have liked.
I recently did find out a bit more about his experience as a prisoner of war by reading a book about the experiences of many others in the same prison camp as him, called The Last Escape, The Untold Story of Alled Prisoners of War in Europe 1944-1945.
My grandfather was a replacement waist gunner on a B-17 that was shot down in February of 1944. He had flown three successful missions with his crew, but on the fourth mission during “The Big Week” (see wikipedia) they were returning from a bombing run over Leipzig, Germany, and were shot down.
The entire crew parachuted out of the plane, but were quickly captured by the Germans. They were sent to Stalag Luft 4 near Grosstychow, Prussia where 6,660 other American POWs were held.
My grandfather’s capture was first reported to the International Committee of the Red Cross on February 22, 1944, and he was imprisoned for at least 473 days (1 year and ~4 months) according to the Red Cross.
His recollection of being liberated was in a hospital bed. He went to sleep one night in ill health as a prisoner of the Germans, and woke up to find the Russians had overrun the area. He eventually made his way to France where he recuperated, and then on home to Minnesota where he married and had a family, including his firstborn – my father.
When he left home before the war he weighed in at 180 lbs, and came home at a thin 130 lbs at the end of 1945. We’re so thankful he made it back, so many were not so lucky.
Since it is Memorial Day weekend the cemetery will be in full bloom with flags flying, and flowers on countless graves, in remembrance of loved ones. It’s usually a very stirring sight, and I may try to make it down there the day after to get a glimpse – and to say thank you in prayer for all those brave men and women.
So on this Memorial Day weekend, thank you to our veterans, and thank you to those who have already paid the ultimate price. You won’t be forgotten.
Whenever you invest, you are taking on a certain amount of risk. There is always the chance that you could lose money. There is no way to completely get rid of investment risk. However, there are things you can do to improve the chances of seeing more gains than losses, and mistakes to avoid.
Here are 5 investing mistakes that could destroy your portfolio:
1. Heavy Reliance on Company Stock
If you invest in a tax-advantaged retirement plan offered by your company, there is a chance that you are heavily invested in company stock. You may not have read over your options carefully when signing up, or you might have accepted some stock as payment or a bonus. While some company stock isn’t a bad thing, you should be careful not to rely too heavily on a portfolio with a lot of company stock. What happens with the company goes down? Your retirement account could be severely damaged.
2. Not Enough Diversity
It’s also important to ensure that you have enough diversity in your portfolio. Anytime you rely too heavily on one type of investment, you add extra risk to your portfolio. Too much diversity can dilute the effectiveness of your portfolio. But you you should consider diversity across sectors and asset classes, as well as geographic location. Consider your own investing goals and choose a mix that is appropriate for you.
3. Not Understanding Your Risk Tolerance
You should know yourself and your investing needs. You should be aware of your risk tolerance. This is how much risk you can bear, in terms of your financial situation and your emotional ability to handle the realities of the market. You have to understand your risk tolerance in order to make better decisions about your investments. Know what you can afford to lose, and recognize when your emotions are getting in the way of better decisions.
4. Refusing to Change Your Position
Sometimes, it’s time to make changes to your portfolio. When you have a more passive investing strategy, along the lines of buy and hold or investing for retirement, this might take the form of re-balancing at regular intervals. In more active strategies, you might need to cut your losses and sell a loser. Or, you might have a winner that keeps climbing and climbing in a short period of time. It might be wise to take profits while you still have that chance, rather than trying to run up bigger profits. It’s important to re-assess the contents of your portfolio regularly, and consider making changes as appropriate.
5. Investing in Something You Don’t Understand
Warren Buffett famously suggested that you should understand what you’re investing in. Before you add something to your portfolio, you should understand how it works. Stocks, bonds, funds, commodities, real estate, currencies and other investments are traded in different ways, and are affected by different economic conditions and market perceptions. One of the reasons we ended up with such a disaster in 2008 was due to complex financial instruments that few people understood when they were investing in them. Learn about what you are investing in, know where to research investments, and how it might affect your portfolio.
Tom Drake is the head writer at MapleMoney, covering everything from universal topics like budgeting and investing to Canadian topics like RRSPs and the the TFSA.
A short while ago I wrote reviews of two services that recently launched, both of which intrigued me. One is a free online savings account called Digit, and the other is a free automated investing adviser called Axos Invest.
Both companies are different from anything else out there.
Digit’s claim to fame is that they will automatically save money for you after analyzing your spending and account balance trends. Once Digit figures out how much it can save without you noticing, or overdrawing your account, it just does it. It saves small amounts to your Digit savings account throughout the month. At the end of the month, you’ve got a nice lump sum saved in your account. (Digit review here)
Axos Invest is gaining traction because of its unique business model as well. They’re a robo-adviser, an automated investment advisory along the lines of Betterment or Wealthfront, but they’re different in that they don’t charge any management fees as most other companies do. They invest your money in ETF index funds with no trading fees and no management fees whatsoever. They plan to make their money off of premium add-on products like tax-loss harvesting in the future. (Axos Invest review here)
I liked the ideas behind these services and signed up for both of them to give them a trial run. While I was at it I decided to turn this into a bit of an experiment. I plan to see just how much money I can automatically save and then invest with them through the end of the year. I thought it would be interesting to show just how much you can automatically save and invest (at no cost), without even thinking about it. Saving and investing doesn’t have to be hard, or expensive!
Digit Savings Account
According to Ethan Bloch, the founder of Digit, the company was started to help people, “maximize their money, while at the same time driving the amount of time and effort it takes to do so as close to 0 minutes per year as possible”
So how does Digit work? You sign up for an account, and link your checking account. Digit will then analyze your income and expenses, find patterns and then find small amounts that it can set aside for you – without any pain for you.
So once you sign up and turn on auto-savings, every 2 or 3 days Digit will transfer some money from your checking to your savings, usually somewhere between $5-$50. Digit won’t overdraft your account, and they have a “no overdraft guarantee that states they’ll pay any overdraft fees if they accidentally overdraft your account.
Open Your Digit Savings Account
Axos Invest Investing Account
Axos Invest launched with the goal of being the world’s first completely free financial advisor. Their founders had a mission “to ensure everyone can achieve their financial goals, which starts with investing as early as possible. This is why there is no minimum to start and we do not charge fees.”
Axos Invest’s founders understood that one of the drags on the typical person’s portfolios is the fees that they’re paying to invest, as well as the friction point of having to invest thousands of dollars to start. They changed that with no minimums to invest, and no fees charged for investing. Axos Invest will be releasing some premium add-on products for their users, which they will charge for, but a basic investing account will not cost anything beyond the mutual fund expense ratios associated with your investments.
What do you invest in with Axos Invest? Axos Invest will invest your funds based on Modern Portfolio Theory (MPT). Your investments will be diversified, low cost, and recognize the value of long term passive investing by investing in ETF index funds.
Open Your Axos Invest Investing Account
The Digit + Axos Invest Experiment (D+AI Experiment)
For the experiment I plan on using the two accounts I have just opened with Digit and Axos Invest in order to show just how easy it is to invest.
From now until the end of the year I plan on allowing Digit to automatically save money from my checking account and put it into my Digit savings.
When the amount in the account gets to around $75 or more, I’ll transfer it back to the checking and transfer the same amount over to my Axos Invest Roth IRA to invest in their automated investing service. I figure by doing it this way, I’ll engage in a bit of dollar-cost averaging, instead of waiting until the balance is higher and investing once or twice. Since Axos Invest has no minimums and you can buy fractional shares, why not?
When the end of the year rolls around I’ll do a review and look at how much money I’ve been able to save and invest using these two sites.
The Experiment In Progress
Once I had setup my Digit and Axos Invest accounts I started putting the experiment into action in early February. I turned on the automated saving feature of the Digit savings account, and waited for the small savings amounts to start showing up. After about 3-4 days, my first few deposits into Digit appeared. There were deposits for $5, $6.50, $8.45, $2.35 all within the first 7 days. I have also referred friends to Digit, and $5 referral bonuses started showing up as well.
Day after day the referrals and savings deposits started piling up and before I knew it, I had $186 in the account. At this point I decided to withdraw and make my first investment over at Axos Invest.
Amounts Withdrawn And Invested So Far
I’m only about a month into my little experiment, and so far I’ve withdrawn my Digit savings balance and invested it in my Axos Invest Roth IRA twice. The amounts were:
$186.00
$74.72
Here’s a screenshot from my Digit account showing my latest withdrawal for the purpose of investing.
After withdrawing the money I then transfer it from my checking account over to Axos Invest. Here’s a screenshot of my latest deposit with Axos Invest.
Once this deposit goes through I’ll have a little less than $260.72 invested at Axos Invest since the market has gone down slightly since I started. You can see the $184.84 total invested for my first $186 deposit below.
Here’s the portfolio’s asset allocation in my Axos Invest account currently. Probably a tad more aggressive than in my other retirement accounts, but that’s OK.
The funds that Axos Invest uses and their expenses are shown below (and are subject to change)
Vanguard Total Stock Market ETF (VTI): 0.05%
Vanguard FTSE Developed Markets ETF (VEA): 0.09%
Vanguard FTSE Emerging Markets ETF (VWO): 0.15%
Vanguard Intmdte Tm Govt Bd ETF (VGIT): 0.12%
Vanguard Short-Term Government Bond Index ETF (VGSH): 0.12%
iShares Investment Grade Corporate Bond ETF (LQD): 0.15%
State Street Global Advisors Barclays Short Term High Yield Bond Index ETF (SJNK): 0.40%
iShares Barclays TIPS Bond Fund (ETF) (TIP): 0.20%
Vanguard REIT Index Fund (VNQ): 0.10%
Depending on how the market does, we’ll see what kind of returns my account sees. No matter how it goes, I’m already ahead of the game as I don’t have to pay any account management or trading fees. Can’t beat that.
Join In The Digit & Axos Invest Experiment
If you’re intrigued by Digit and Axos Invest like I was, and want to join in the “D+WB Experiment”, I invite you to join in.
Open an account with both services (both accounts are free), set Digit to start automatically saving and get started. Let’s see how much we can save and invest this year – without lifting a finger!
About 6 months ago I discovered two cool new services that had recently launched, both of which were a part of the recent trend towards automated saving and investment account options.
The first one was an free online savings account from Digit, an account that helps take the busy work out of saving. It analyzes your checking account daily and at regular intervals it saves small amounts of money from your checking and puts it into your Digit savings account – without your intervention. It allows you to save money, a little bit at a time, without even realizing it.
The second account is a free automated investment adviser from the folks at Axos Invest. When you have an investment account from Axos Invest, their system will allow you to regularly invest in a taxable or tax-advantaged retirement account, and it will automatically invest your funds in a portfolio of low-cost ETF index funds. It’s a great new long term investing site, along the lines of Betterment or Wealthfront, but without any account management costs.
Digit and Axos Invest are both big on the idea of automating things in order to make them more efficient, more cost-effective and better for your bottom line. I liked the idea behind both sites, and after signing up I decided to take them on a trial run and to run an experiment.
Just how much could I save automatically for the year using Digit’s tools? How much would I be able to invest at no cost using Axos Invest? How much intervention would I need to have – and just how much could I save over time? First, let’s take a brief look at these two accounts.
Digit Savings Account
According to Ethan Bloch, the founder of Digit, the company was started to help people, “maximize their money, while at the same time driving the amount of time and effort it takes to do so as close to 0 minutes per year as possible”
So how does Digit work? You sign up for an account, and link your checking account. Digit will then analyze your income and expenses, find patterns and then find small amounts that it can set aside for you – without any pain for you.
So once you sign up and turn on auto-savings, every 2 or 3 days Digit will transfer some money from your checking to your savings, usually somewhere between $5-$50. Digit won’t overdraft your account, and they have a “no overdraft guarantee that states they’ll pay any overdraft fees if they accidentally overdraft your account.
Open Your Digit Savings Account
Axos Invest Investing Account
Axos Invest launched with the goal of being the world’s first completely free financial advisor. Their founders had a mission “to ensure everyone can achieve their financial goals, which starts with investing as early as possible. This is why there is no minimum to start and we do not charge fees.”
Axos Invest’s founders understood that one of the drags on the typical person’s portfolios is the fees that they’re paying to invest, as well as the friction point of having to invest thousands of dollars to start. They changed that with no minimums to invest, and no fees charged for investing. Axos Invest will be releasing some premium add-on products for their users, which they will charge for, but a basic investing account will not cost anything beyond the mutual fund expense ratios associated with your investments.
What do you invest in with Axos Invest? Axos Invest will invest your funds based on Modern Portfolio Theory (MPT). Your investments will be diversified, low cost and recognize the value of long term passive investing by investing in ETF index funds.
Open Your Axos Invest Investing Account
The Digit + Axos Invest Experiment (D+AI Experiment)
So for my Digit and Axos Invest experiment, the goal was not only to try out these two free products, but also to show just how easy (and low cost) it can be to invest.
When I started in early February my goal was to allow Digit to automatically save money from my checking account and put it into my Digit savings. Whenever the amount in my Digit savings reached $75 I would transfer that money over to my Axos Invest account and invest it in their highly diversified set of ETF index funds.
Why was I doing it this way? I did it this way because Axos Invest has no minimums and you can buy fractional shares, so why not? I can transfer money in small chunks, and engage in a bit of dollar-cost averaging while I’m at it.
So how are things going now that we’re more than half the way through the year?
The Experiment In Progress
Once I had setup my Digit and Axos Invest accounts I put the plan in action and allowed my Digit account to start saving on my behalf. After a few days Digit had started saving small amounts in my account. There was $7.50 here, $15 there – as well as $5 deposits for referrals of friends and readers. Multiple transfers and deposits ended up adding up to larger amounts over a couple weeks time. The first time that I invested with Axos Invest I deposited $186 that had accrued in my Digit account.
From then on every time the amount reached around $75 or more, I would transfer the money to Axos Invest.
Amounts Withdrawn And Invested So Far
I’m now just over 5 1/2 months into my little experiment, and so far I’ve withdrawn my Digit savings balance and invested it in my Axos Invest Roth IRA 14 times. The amounts were:
$74.36
$79.76
$121.75
$82.03
$95.67
$81.27
$93.28
$109.47
$76.20
$99.08
$99.32
$90.88
$74.72
$186.00
Here’s a screenshot from my Digit account showing my latest withdrawal for the purpose of investing.
After withdrawing the money I then transfer it from my checking account over to Axos Invest. Here’s a screenshot of one of my latest deposits with Axos Invest. In the screenshot you can also see how deposits are then used to purchase fractional shares of the ETF index funds used in the account.
Once my latest deposit of $74.36 goes through I’ll have $1380.70 invested at Axos Invest.
Here’s my portfolio’s asset allocation in my Axos Invest account. It is a bit more aggressive than in my other retirement accounts.
The funds that Axos Invest currently uses, and their expenses, are shown below (and are subject to change)
Vanguard Total Stock Market ETF (VTI): 0.05%
Vanguard FTSE Developed Markets ETF (VEA): 0.09%
Vanguard FTSE Emerging Markets ETF (VWO): 0.15%
Vanguard Intmdte Tm Govt Bd ETF (VGIT): 0.12%
Vanguard Short-Term Government Bond Index ETF (VGSH): 0.12%
iShares Investment Grade Corporate Bond ETF (LQD): 0.15%
State Street Global Advisors Barclays Short Term High Yield Bond Index ETF (SJNK): 0.40%
iShares Barclays TIPS Bond Fund (ETF) (TIP): 0.20%
Vanguard REIT Index Fund (VNQ): 0.10%
We’ll see what kind of returns my account sees over the coming months/years, but I’m sure it will about match what the market does. Since I’m not paying any account management fees as well, I’ll be coming out ahead as compared to some other robo-adviser competitors.
How’s It Going So Far?
So how is the experiment going so far? I think it’s been pretty successful. I’ve saved $1380.70 over the 5 1/2 month period. If we round that up to 6 months it means an average saved of about $230.12/month.
Multiply the $230.12 by 12 months and it means that if I continue this experiment for an entire year, I could expect to see somewhere in the neighborhood of $2761.40 saved for the year.
While $2761.40 isn’t going to profoundly change someone’s life, it isn’t a small amount of money either.
If you look at that $2761.40 amount, it’s just over half of the annual $5500 contribution limit for a Roth IRA. So essentially, over half of my year’s worth of Roth IRA contributions are happening without any pain for me.
The money is coming out in small chunks, so small I don’t even notice. Over time those small chunks are adding up to larger dollar amounts that do make a difference to my long term strategy. All in all I think it’s a pretty powerful idea, making savings and investment happen automatically in the background, with only a small amount of intervention needed from you. The fact that both of these tools are also free is just icing on the cake.
Join In The Digit & Axos Invest Experiment
Interested in joining the “Digit and Axos Invest Experiment”? I invite you to join in! The only risk you’ll have by joining is that your retirement accounts will grow over time and that you’ll likely be paying fewer costs than your current retirement account provider.
Open accounts with both services, set Digit to save automatically, and get started. You’ll be glad you did. Let’s see how much you can invest – with minimal effort or intervention!
In October I published my most recent update in what I call “The Digit + Axos Invest Experiment”.
Since February has come and gone I thought this might be a good time to do my review of the experiment after 1 year – to see just how much I was able to save, and invest, over that time.
The Experiment
The series of posts was designed to show just how easy it can be to save and invest using today’s free and automated saving and investing solutions.
To facilitate the experiment I opened two new accounts, both with free automated services that I discovered just over a year ago
The first account was an free online savings account from Digit, an account that helps take the busy work out of saving. It analyzes your checking account daily and at regular intervals it saves small amounts of money from your checking and puts it into your Digit savings account – without your intervention. It allows you to save money, a little bit at a time, without even realizing it.
The second account is a free automated investment adviser from the folks at Axos Invest. When you have an investment account from Axos Invest, their system will allow you to regularly invest in a taxable or tax-advantaged retirement account, and it will automatically invest your funds in a portfolio of low-cost ETF index funds. It’s a great new long term investing site, along the lines of Betterment or Wealthfront, but without any account management costs.
Digit and Axos Invest are both big on the idea of automating things in order to make them more efficient, more cost-effective and better for your bottom line. I liked the idea behind both sites, and after signing up, a year ago I decided to take both services on a trial run, and to run an experiment.
Just how much could I save automatically for the year using Digit’s tools? How much would I be able to invest at no cost using Axos Invest? How much intervention would I need to have – and just how much could I save over time? First, let’s take a brief look at these two accounts.
Digit Savings Account
According to Ethan Bloch, the founder of Digit, the company was started to help people, “maximize their money, while at the same time driving the amount of time and effort it takes to do so as close to 0 minutes per year as possible”
So how does Digit work? You sign up for an account, and link your checking account. Digit will then analyze your income and expenses, find patterns and then find small amounts that it can set aside for you – without any pain for you.
So once you sign up and turn on auto-savings, every 2 or 3 days Digit will transfer some money from your checking to your savings, usually somewhere between $5-$50. Digit won’t overdraft your account, and they have a “no overdraft guarantee that states they’ll pay any overdraft fees if they accidentally overdraft your account.
Open Your Digit Savings Account
Axos Invest Investing Account
Axos Invest launched with the goal of being the world’s first completely free financial advisor. Their founders had a mission “to ensure everyone can achieve their financial goals, which starts with investing as early as possible. This is why there is no minimum to start and we do not charge fees.”
Axos Invest’s founders understood that one of the drags on the typical person’s portfolios is the fees that they’re paying to invest, as well as the friction point of having to invest thousands of dollars to start. They changed that with no minimums to invest, and no fees charged for investing. Axos Invest will be releasing some premium add-on products for their users, which they will charge for, but a basic investing account will not cost anything beyond the mutual fund expense ratios associated with your investments.
What do you invest in with Axos Invest? Axos Invest will invest your funds based on Modern Portfolio Theory (MPT). Your investments will be diversified, low cost and recognize the value of long term passive investing by investing in ETF index funds. Plus, when you sign up now, you’ll get a $20 Signup Bonus!
Open Your Axos Invest Investing Account and Get A $20 Bonus!
The Digit + Axos Invest Experiment (D+AI Experiment)
So for my Digit + Axos Invest Experiment, the goal was not only to take these two free products for a spin, but also to show just how easy (and low cost) it can be to invest. There really should be no excuse to not get started.
When I started in February 2015 my goal was to allow Digit to automatically pull money from my checking account and put it into my Digit savings. Whenever the amount in my Digit savings reached $75 or more I would transfer that money over to my Axos Invest account and invest it in their highly diversified set of ETF index funds.
Why was I doing it this way? I did it this way because Axos Invest has no minimums and you can buy fractional shares, so why not? I can transfer money in small chunks, and engage in a bit of dollar-cost averaging while I’m at it.
So how are things going now that I’ve been doing the experiment for an entire year? Let’s take a look.
The Experiment 1 Year In Progress
After setting up my Digit and Axos Invest accounts I put the plan in action and allowed my Digit account to start saving on my behalf.
Digit started saving small amounts in my account when I first began. $5 here, $15 there. Over time multiple transfers and deposits ended up adding up to larger amounts in my Digit account. My first transfer to my investment account was about $186.
From then on every time the amount reached around $75-$100 or more, I transfered the money to Axos Invest.
Amounts Saved And Invested In One Year
I’m now just over 1 year into my little experiment, and I’ve withdrawn my Digit savings balance and invested it in my Axos Invest Roth IRA 25 times.
Here are the amounts that I have withdrawn and invested, with the most recent investment first:
$541.21
$230.47
$296.95
$350.92
$306.40
$445.21
$173.84
$419.66
$112.68
$155.20
$142.02
$74.36
$79.76
$121.75
$82.03
$95.67
$81.27*
$93.28
$109.47
$76.20
$99.08
$99.32
$90.88
$74.72
$186.00
A total of $4538.55 was saved by my Digit account over the 12 months I did this experiment. I invested $3347.68 of that in my Roth IRA. (the last couple of months in the experiment a large tax bill came due and some of the Digit savings went to that instead of my Roth IRA)
Here’s a screenshot from my Digit account showing my latest $541.21 withdrawal for the purpose of investing.
After withdrawing the money I then transfer it from my checking account over to Axos Invest. Deposits can be used to purchase fractional shares of the ETF index funds used in the account.
I currently have $3298.83 invested at Axos Invest, from the $3347.68 I have deposited. The investments (and the markets) have gone down about 1.5% since I started, so that accounts for the losses.
Here’s my portfolio’s asset allocation in my Axos Invest account. It is a bit more aggressive than in my other retirement accounts.
The funds that Axos Invest currently uses, and their expenses, are shown below (but are subject to change)
Vanguard Total Stock Market ETF (VTI): 0.05%
Vanguard FTSE Developed Markets ETF (VEA): 0.09%
Vanguard FTSE Emerging Markets ETF (VWO): 0.15%
Vanguard Intmdte Tm Govt Bd ETF (VGIT): 0.12%
Vanguard Short-Term Government Bond Index ETF (VGSH): 0.12%
iShares Investment Grade Corporate Bond ETF (LQD): 0.15%
State Street Global Advisors Barclays Short Term High Yield Bond Index ETF (SJNK): 0.40%
iShares Barclays TIPS Bond Fund (ETF) (TIP): 0.20%
Vanguard REIT Index Fund (VNQ): 0.10%
We’ll see what kind of returns my account sees over the coming months/years, but I’m sure it will be close to what the market does. Since I’m not paying any account management fees to invest, I’ll be coming out ahead as compared to some other automated investment advisers.
A Recap Of My Progress After 1 Year
So how has the experiment gone now that I’ve made it an entire year? In my book it’s been a rousing success. I’ve saved $4538.55 over the 12 month period via Digit. If we divide that over 12 months, it means an average saved of about $378.21/month.
If you look at that $4538 amount, it’s about 83% of the annual $5500 contribution limit for a Roth IRA. So essentially, almost all of my year’s Roth IRA contributions are happening without me having to actually think about it.
The money is slowly coming out of my accounts – usually in amounts that don’t even really register. The savings amounts tend to be in the $10-50 range, although a few have been $100+. It’s amazing how fast those small amounts really add up!
The Power Of Investing Over Time
Let’s say you were in your 20s and you were to do something similar to what I’m doing with this experiment. You could end up with a pretty nice start to your nest egg over time.
Just setup automated savings and investments, and in my case that $4538 contribution for the year when extrapolated out over 30 years at an average 8% interest, will end up as just over $567,300 over 30 years.
To me that’s the power of long term investing. You can take small savings and investment amounts like this, and make it grow. In the end those small amounts end up adding up to a large lump sum in retirement. That’s pretty powerful. Why not get started now?
Join In The Digit & Axos Invest Experiment
Interested in joining the “Digit and Axos Invest Experiment” for year 2? I invite you to join in!
Open your accounts here:
After your accounts are open, sit back and wait for the savings to pile up – then invest! Piece of cake! Give it a shot and let us know how it goes!