WealthFast Podcast

If you had a bunch of employees, would you pay them to sit around and do nothing all day? Would you pay them to paint their fingernails, watch TV, and sleep late? Of course not. That behavior will never earn your business any money. If you pay all of your employees to do nothing -- to be lazy and unproductive and value "leisure" over real, productive work – you will eventually run out of money and you won't be able to hire anyone. Well, your dollars are your employees. They need a job, just as much as people need a job. Think about it: workers are called "human capital." Money is just plain capital. It needs to be managed just as much as your workforce would need to be managed. A budget is a way of giving each dollar a job. You'll know what function each dollar is filling, rather than wondering what all your employees are doing. Not every dollar can directly earn new money. Some dollars need to be spent on overhead costs, such as food, shelter, and clothing. But as every business leader knows, the less you spend on overhead, the more you can invest in resources that will yield a direct return. We discuss this concept in today's podcast. Enjoy! Mentioned in this episode Lending Club Prosper Lending Index Funds

In 2009, the Dow Jones Industrial Average -- a composite measure of 30 large-cap U.S. companies -- stood at 6,500. Now it's back to pre-recession levels. Does this mean the Dow has reached its peak? Should you sell your equities? Or does this mean it's on the way up? Should you buy more? Neither of the above. The past is the past, and it's not related to the future. The question you should ask yourself is: are US equities currently a good deal or not? The price of stocks three years ago is irrelevant. Just because the stock is rising doesn't mean it's upside has been maxed out. Conversely, just because something has fallen a lot doesn't mean it's downside is tapped or limited. So let's look at some of the current market conditions: More jobs are being added. More homes are being built. In metropolitan Atlanta, for example, 37,400 new jobs were created last year. Atlanta isn't special: it's indicative of trends happening across the nation. Meanwhile, the sales of existing homes at every price point (from starter homes to luxury abodes) is rising, according to the National Association of Realtors. Inflation, thus far, has not been an issue, in part because the Fed has promised keep rates low until 2014. What happens after 2014 is anyone's guess. Vanguard analysts predict 2.5% inflation for the next decade, but a prediction is just a fancy way of saying "guess." So what should you do? Should you buy, sell or hold your stocks? None of the above. Unless you're a stock-market scholar, avoid market timing. Continue to dollar-cost average your investments.

In this week's episode, we review the book The 10 Commandments of Money by Liz Weston, the most widely-read personal finance writer on the web, according to Nielson. What are the 10 commandments? I: Create a Budget That Works in the Real World II: Create a Survival Plan with Cash and Credit III: Pay Off Debt the Smart Way IV: Don’t Avoid Risk … Embrace It, but Sensibly V: Your House Is Not a Piggy Bank VI: Saving for Retirement Must Come First VII: Get a College Education You Can Afford VIII: Reserve Insurance for the Big Losses IX: Treat Your Marriage Like a Business X: Defend Yourself in the War on Consumers Wondering what these commandments mean? Want more detail? Listen to the podcast to hear all about it! Mentioned in this episode: LizWeston.com Volatility: Riding the Mechanical Bull Book Reviews at Afford Anything

The latest podcast episodes answers a pressing question from a listener: Should I Buy an "Okay" House Now, or a Great House Later? Here's the listener's dilemna: He's a single guy who currently has about $10,000 saved. He can use that as a 10 percent downpayment on a $100,000 house. He'll pay private mortgage insurance on the loan, since he's offering less than 20 percent down. And he'll probably move after a few years, since he doesn't think that a $100,000 house will be large enough to accommodate a family, which he'll most probably want in a few years. Should he buy a $100,000 house right now? Or should he continue paying rent and bide his time, while he waits to save up enough money to cover a down payment for a $200,000 -- $300,000 house? In this podcast, we cover all the issues that he should consider, including the transaction costs associated with home buying and selling, the cost of property taxes, homeowner's insurance, repairs, maintenance, and private mortgage insurance, the potential appreciation of the home, and the amount he could earn in the stock market as an alternative. Listen in, and leave us a review on iTunes!

We didn't fall off the fiscal cliff! Hooray! **Didn't-fall-off-a-cliff-dance!** But don't break out the champagne just yet. There's still a lot more political bickering and market volatility ahead. Fiscal Cliff What would have happened if we fell off the fiscal cliff? Three things: #1: A round of tax cuts would have expired, resulting in  tax increases across the board, affecting most Americans. This causes customers to spend less, which slows the economy. #2: Also, there would be more entitlement cuts, so people at the lowest rungs have less to spend, also slowing the economy. #3: Finally, there would be massive cuts to government services and industries, meaning the government would be providing fewer jobs, instituting hiring freezes, and creating furloughs. This puts less money in government worker's pockets, which also slows the economy. Now that we avoided the fiscal cliff: Government workers, ranging from Pentagon officials to DOT and DOE bureaucrats, won’t see furloughs or job cuts. The tax increase affects only the top 1 percent (although that affects many small businesses and could result in unemployment. Tune into our podcast to hear why.) The employer-paid payroll tax increases from 13.3 percent to 15.3 percent, which could also slow down job creation. The long-term capital gains tax also increases 3.8 percent, in the form of a Medicare tax. That's bad news for investors. The fiscal cliff compromise helps the feds make more money, reducing the deficit. That's good. But it also hurts employers and investors, which is bad for everyone. What's next in 2013? Expect volatility. In the past month, the Dow Jones ranged from 12,600 to 13,400 -- a wide range -- mostly based on investor sentiment about whether or not we’d fall off the cliff. As politicians continue to argue, and investors continue to get spooked/optimistic/spooked/optimistic about what political leaders will do, we can expect to see more volatility. Also, the debt ceiling will also be back on the negotiating table in 2013. That will cause more political bickering, with its subsequent volatility. There's a slow-but-steady uptick in housing prices, and job growth, which is good. But new taxes on employers or market volatility can derail that progress. We're seeing low bond yields, which are a sign of caution. It means investors are keeping higher-than-average percentages of their portfolios in the safer fixed income asset classes (like Treasuries) and out of riskier classes such as equities and commodities. For more news on the fiscal cliff, debt ceiling and 2013 predictions, tune into the latest podcast.

The ladies of the WealthFast Podcast give you seven actionable steps to multiply your way to wealth. These are not resolutions, these are a way of life.   Are you ready to become wealthy? What are your goals for 2013 and the rest of your life? On this episode of the WealthFast Podcast Paula from AffordAnything.com and LaTisha from YoungFinances.com give you 7 steps to become wealthy. If you incorporate these steps into your life on a daily basis you will see a change in your finances! Also for this week's Think Rich tip we talk about breaking down your goals into small steps.   By the way, in this episode we mention .. The Millionaire Next Door Paula's Recommended Credit Card for Rewards As always, if you have questions, comments or a story you want to share, call our hotline at 770-744-0527. You can access that hotline through our Contact Page, or via the awesome icon in our right-hand sidebar.  

Sometimes, unknowingly we part with money that should really should stay with us. This episode the ladies of the WealthFast Podcast are talking about hidden fees, scams and deceptive charges to look out for. Paula from AffordAnything.com covers unnecessary gift card fees and airline fees and LaTisha from YoungFinances.com reminds you to keep an eye out for those pesky brokerage fees when you are trading or managing your end of year portfolio rebalancing. This week, our Think Rich tip is meant to put you in motion, because motion creates emotion! Tune in to learn more and visit WealthFastPodcast.com to ask a question!

The media is obsessed with the fiscal cliff. Major cable networks are naming their features "Fiscal cliffhanger!" and "Countdown to the crisis!" So you're wondering: Just what is the fiscal cliff, anyway? How will it affect you? The “fiscal cliff” is a catch-all phrase that describes a series of tax increases and spending cuts that will take effect on January 1. The tax increases, which come in the form of the expiration of the Bush tax cuts, will raise both the income and investment taxes for the majority of middle-class and upper-class people, although the households earning more than $250,000 will feel the biggest burden. Small businesses structured as an LLC or an S-Corp are taxed at the household level. When people discuss “households” earning more than $250,000 per year, they’re also talking about mom-and-pop businesses taxed as households. If the tax cuts expire, the majority of taxpayers and small businesses will pay higher tax rates. This might hurt the economy, because people and businesses will have less money to spend. Furthermore, a round of spending cuts will also go into effect. These cuts take place in two stages. The first stage is characterized by a $1 trillion reduction in funding to almost every agency that gets federal money. That $1 trillion reduction will be paced out over the next decade. Oh, and guess what? That portion of the spending cuts has already gone into effect. The other part of the spending cuts -- the part that happens if we "fall off" the fiscal cliff -- promises an additional $1.2 trillion in spending cuts. This might hurt entitlement programs, which distribute money to lower-income people, who then spend that money, stimulating our economy. This also might hurt jobs in the government sector. And as you can see from this chart, jobs aren't doing so well right now ... Photo Source: Business Insider Want to learn more about the fiscal cliff? Tune into this week's podcast. And by the way, are you curious to know this week's Think Rich Tip? It's to be aware of your political and macro-economic environment. Pay attention to policies that can have a dramatic effect on your investments.

Some internships are worth their weight -- er, excuse me, their "time invested" -- in gold. These internships lead to dream jobs, amazing resume boosters, impressive and transferable skills, and connections that will help you for the rest of your life. Other internships, though, are just cleverly-devised ways that crafty employers squeeze gullible job-seekers for free labor. Networking is the same way. Some networking opportunities will pay for themselves a thousand-fold. Others are just a clever way for the host to collect your drink fees or meal dues. And yet other networking opportunities are simply ... a waste of time. So how can you distinguish valuable internships and networking opportunities from humdrum ones? This week's WealthFast Podcast has the answers. By the way, in this episode we mention .. The Financial Blogger Conference -- the premiere conference for people interested in the intersection of personal finance, financial services, and the Internet. ("Oh, I'm sure the Internet is just a fad ...") By the way, do you have a burning desire to meet LaTisha and Paula in person? You can meet us both at the next Financial Blogger Conference (also known as "FinCon")! Yakezie Personal Finance Bloggers -- Both LaTisha and Paula are members of this networking group, which connects personal finance bloggers together. LaTisha and Paula both underwent a 6-month application period, during which time they had to achieve certain website success metrics and produce other tangible outputs.

Hungry for more cheesecake stories from LaTisha and Paula about money mishaps? This week's WealthFast Podcast focuses on that one oh-so-human habit that prevents millions of people from achieving true wealth: lifestyle inflation. What's lifestyle inflation? Simply stated, it's the practice of raising the bar for what you consider to be a baseline cost-of-living. As your income rises, so do your expectations. You adjust to a "new normal." You'll know whether or not you've experienced lifestyle inflation if the amount of money that you supposedly "need" in order to survive is a much larger sum than it was a few years ago. Want to hear a few examples? Paula bought a $30 dress when she was in college. At that time, that dress felt indescribably expensive. She earned $6.45 an hour during her first year of college; that dress represented one full day's wages. Fast-forward to 2012: she doesn't think twice about buying a $30 article of clothing. Her expectations have risen. That's lifestyle inflation. LaTisha, on the other hand, offers a fantastic example of not succumbing to lifestyle inflation: she chooses to live in a reasonably-priced apartment. It has low utility bills (being on the third floor is great in the winter, when heat rises!) and it's only minutes from her job, so her commuting time and costs are next-to-nothing. This allows her to devote her money to higher priorities. Sure, she could opt to live further away from work, in a more expensive home with higher ongoing utility costs. But since she's happy with her current apartment -- it's already her standard baseline of "normal" -- why adjust it? That said, there are times when lifestyle inflation is okay. And, of course, there are times when it's excessive. Here are a few questions you should ask yourself if you're thinking about raising the bar: Does it help you save time? Does it free your mind to concentrate on other tasks? Does it add a “small joy” to your life, which gives you the motivation to keep persisting towards the bigger picture? In this episode we also discuss this week's Think Rich tip, which is to have a vision board that portrays what you want your life to look like in the future. (No, your vision should not be to simply start a board. Think big.) As always, if you have questions, comments or a story you want to share, call our hotline at 770-744-0527. You can access that hotline through our Contact Page, or via the awesome icon in our right-hand sidebar. Mentioned on this episode: Fiverr.com

You'll hear a few confessions in this week's podcast, as hosts LaTisha and Paula tell stories of a time each of us failed at money and career management. Of course, we'll also tell stories about a time we rocked it. Nope, this isn't campfire story hour. This week's episode centers around the theme of failure and success. Most WealthFast Podcast listeners have big dreams and bold goals. Chasing these goals means that inevitably, we'll encounter setbacks. We need to be ready to cope with these. The ability to stand up from a fall, brush yourself off and try again is the quality that distinguishes people who succeed from people who give up. It's the quality that separates a failure from a learning experience. As Thomas Edison said: “I have not failed. I've just found 10,000 ways that won't work.” You'll hear the "juicy dirt" of the time Paula lost big money in the stock market, and the four years that LaTisha didn't think about how her actions would impact her future. You'll also hear how each of these ladies recovered. Enjoy the show! Got questions? Want to make a comment? Call the WealthFast hotline at 770-744-0527, or use the voicemail option on the right side of our contact page.

Should you get a job or start a business? Society expects you to graduate, get a job, and live behind a white picket fence. But contrary to popular belief, starting a business is more common than you might expect. About 1 in 10 American adults are either running their own business or actively taking steps to start a business.* (Of course, that means 9 out of 10 are not). So should you launch a business? Or should you keep your day job? Here are a few questions you should ask yourself before you take the leap: Do you have any debt? Do you have a business idea already? Do you have any savings? How much business knowledge do you have? Have you ever worked in a management position? Do you have a hard time getting along with others? Do you consider yourself an active person? How many hours a week are you willing to work? Do you work best with a coach or motivator? Do you consider yourself to be persistent? Have you ever worked in a management position? Download this week's podcast to hear more tips on figuring our your next step in life. Resources: -- Check out this great article on LaTisha's website, Young Finances, that asks Should I Start a Business or Get a Job After College? -- Call Me Maybe: Dial our hotline, 770-744-0527, if you have a question or comment. We'll feature it on an upcoming episode! -- Lifestyle Business Podcast: Two entrepreneurs, Dan and Ian, share their experiences with other small business leaders. -- The Manager Tools Podcast: Learn how to become an effective manager. -- Awesome book: The One Minute Manager by Ken Blanchard and Spencer Johnson. This classic discusses productivity, wealth and job satisfaction. -- Awesome book: The Personal MBA by Josh Kaufman. Josh leads you through all the ways you can have MBA-level knowledge without enrolling in grad school. Also, check out the Personal MBA reading list, a list of 99 books you should read to gain business acumen. This Week's Think Rich Tip: Know yourself! Be honest about your strengths and weaknesses. Be realistic about your level of skill, motivation and risk tolerance. Listen to the podcast to learn more. * Source: Neils Bosma and Rebecca Harding, Global Entrepreneurship Monitor, Babson College, 2006.

Here's an interesting investing paradox: You must be well-informed about your investments while simultaneously staying diversified. You see, here's the problem. To be a savvy investor, you have to understand the industry/company you're sinking money into. Investing without knowledge, research and due diligence is gambling. But your brain can only handle so much. You can't be an expert in everything. At the same time, you shouldn't put all your eggs in one basket. (Trust me, I've tried. You'll hear the story in this week's episode.) So how can you balance the need to diversify with the obligation to stay informed? Here are a few suggestions for stock investing: Buy many stocks within the same industry, - or - Buy one or two stocks per industry, across multiple industries Limit the total number of individual stocks that you own Here are a few suggestions for real estate investing: Stick to only managing rentals, or only flipping houses, or only selling lease-purchases ... in other words, stick to one core business strategy, but diversify across neighborhoods and geographic zones or across rental classes - or - Stick to one geographic area, but diversify by doing flip/rental combos. This isn't a comprehensive list of how to diversify. These are just a few suggestions. For more details, listen to the podcast! Resources In this week's podcast, we discuss a guest post on Paula's website, Afford Anything, called “How I Started Flipping Houses.” It was written by a man who started out holding rental properties, and then diversified into flipping houses. He produced one great flip ... and one flop. Read his story at that link! Got questions? Call our hotline at 770-744-0527. We'll answer your question in an upcoming episode.

Have you ever heard a strange financial word or phrase and wondered, "Hmm. What does that mean?" In this week's episode, we'll explain funny (and serious!) financial terms. We begin with a look at odd-ball financial phrases like "muppet bait" (no, it's not something you use to catch Kermit the Frog) and "death star IPO"   (you Star Wars fans will enjoy the reference). We also explain the underlying rationale for some of the cliches and phrases that people in the financial industry use, like "sell in May and go away." As always, we define these funny finance terms with our trademark slapstick humor. In case you've still got a hankering for learning financial letter-combinations, we also explain some key acronyms every investor should know: IPO, ETF, TARP (nope, it's not what you use to cover firewood) and DRIP. As always, we launch the episode with a "Think Rich" tip. The 2012 Presidential election is coming up, and -- without taking a stance  -- we'll tell you why it's so important to be informed about the candidates' economic policies. Got a question? Call us at the WealthFast hotline: 770-744-0527 (or press that big green "call" button the right side of the WealthFast homepage!)

Let's be clear about something: the ladies of the WealthFast Podcast are interested in building wealth, not obsessing about frugality. We believe our time, talent, and potential is too valuable to waste it clipping coupons or trying to make our own homemade toothpaste. That said, there's no reason to throw money out the window. So we've devoted this week's WealthFast Podcast to explaining a few simple, easy ways you can cut some of the ongoing "overhead" costs from your life. Every tip we share is something that doesn't take too much of your time, and that reaps dividends (in the form of savings) for months to come. Check it out, and call in with your own tip!