by Andrew on March 5, 2010
In an effort to maximize my college student budget I have recently began to utilize coupons at grocery stores. While using coupons to save money is hardly a novel idea in itself. I would like to introduce you to the high tech way to maximize your grocery budget.
1. Go to either ShortCuts.com or Coupons.com and register.
2. Link your savings card to your account. Unfortunately not all major grocery chains participate in this trend.
3. Add coupons directly to your savings card.
This is a great consumer friendly trend that can really boost the budgets of smart shoppers. I recommend combining in store sales with online coupons to maximize savings. While it is wonderful to find additional savings be careful not to use this as an excuse to buy items you normally would pass up on.
by Andrew on February 28, 2010
The follow post is a deviation from my Components of Investing series but it is a topic that I have been considering a lot lately.
While investment returns are an elemental component of accumulating wealth they are neither the only factor, nor the most important for young investors. I would like to suggest that for college-aged individuals the most important component of wealth building is in fact the savings rate of the individual. Thus I encourage my peers to focus on saving more rather than reaching for extra returns (through excessive risk).
What seems like a rather simple concept of setting aside money for long-term goals rather than short-term consumption is in fact difficult to achieve. To calculate a simple representation of your saving rate, divide your total savings by your total income. According to the Bureau of Economic Analysis the United States, saving rate was at 4.8 percent as of December 2009.
In order to see the benefit of increasing your savings rate consider the following example.
| Saver |
Savings per year |
Rate of return |
Total after 20 years |
| College Saver One |
$2,000.00 |
8 Percent |
$100,845 |
| College Saver Two |
$1,776.50 |
9 Percent |
$100,845 |
1.0 Percent increase in rate of return = $223.50 per year additional saving
College Saver One received the same result as College Saver Two by contributing an addition $223.50 per year. Personally I feel that it is in the best interest of my wealth to strive to increase my savings rate rather than adding more risk to my portfolio.
Often while perusing personal finance and investing blogs intended for young investors I see authors encouraging and recommending financial behavior that is extensively risky. While I am a firm believer in respecting others decision to use alternative means of building wealth, I cannot help but cringe at some of the recommendations. I personally do not believe that extensive trading and the use of leveraged funds or margin accounts is necessary for the average young investor to build wealth. In fact I tend to believe that these practices can instead be damaging to the individuals long-term wealth.
I am not indicating that we should construct our portfolios out of certificate of deposits and government bonds just that we assume risk in a manner that is calculated and well-planned.
