5 Steps to Overcoming Bad Investing Behavior

retirement invest

Many people who invest wonder why they’re not getting some of the investment returns that others are getting, even if it seems like they are doing the exact same thing. retirement invest

One of my favorite presentations that tackled this topic was between Carl Richards, author of The Behavior Gap, talking with Betterment founder Jon Stein. They went over bad investing behaviors and how to fix them.

  1. Evaluate & Set Goals: Carl emphasizes getting a snapshot of your current reality. Once you know where you’re currently are financially he then says create specific goals about where you want to be . He points out setting goals around what you want to do with your money, reflecting your unique values.
  2. Be Realistic: You’re Not Going to Beat the Market: You have to determine how to invest the money. We tend to take past and use it to predict the future, especially with stocks.
  3. Avoid the Gap: Investment returns vs investor returns – Carl show how we actually invest is so different from the reported returns. Many times human nature  has people buying and selling at the wrong times. Don’t find the best investment, become a better investor.
  4. Automate: Automation helps us overcome our tendency to tinker with our investments when we shouldn’t. It’s not exciting, but it works.
  5. Keep It Simple: Think of creating a financial system as a set of guardrails to protect yourself from hurting your own finances. If it’s a complicated system you won’t be able to keep up with it.

I think Jon had some great points to add with Carl’s tips. He shared his own story about investing in the wrong stock and how it made him realize that investing in the market rather than just stocks was the ticket.

Thoughts on Investing

How about you? How are your investments doing? How many of you have made some of these investing mistakes in the past and have changed?

Betterment: Retire Richer

Amazon App Store

While games like Words with Friends can be fun online, I prefer games that I can play without a wi-fi connection on my tablet. I tend to get free apps, but honestly some for them aren’t that challenging or fun.

However constantly buying apps will drain my budget. One solution is grabbing a paid app for free when it comes up.

Amazon App – One App to Get Many

One app that has help me grab some great games for free – Amazon App Store. Every day they have a paid app available for a free download. Even though the app is free, you do have to have an Amazon account and you need to sign up for 1-click shopping.

Since I already use Amazon for some household shopping items it was not a big deal for me. Check it out if you’re interested in getting more details.

Great Free Apps

Besides what you can grab from Amazon’s App of the Day, there are some apps that are extremely helpful that I want to share.

  • TripIt: When traveling, it can be a bit crazy carrying all the paperwork for the flights, hotels, and car rental for everybody. With trip it, you can have all of that information in one spot on your phone.
  • Evernote: I love using Evernote for post ideas, notes on articles I love, and keeping a back up of my important stuff.
  • Pocket: Like an article, but don;t have time to read it right now? Use Pocket to grab the post for offline reading when it’s more convenient for you.
  • Ninja Fishing: A simple, yet addicting fishing game (that’s right-fishing!) that is better on tablet than phone.

Thoughts on Getting Free Apps

How many of you grab free apps through amazon? What are some of your favorite free apps?

UK Population Told to Deal with their Debt

The latest figures from Credit Action reveal that the levels of personal debt were down in 2011 from the level experienced in 2010. While this is good news, debt problems still plague many in the UK and every day 331 people are declared bankrupt or insolvent. Personal debts have gone down but are still in the trillions of dollars. People wishing to avoid having to declare bankruptcy often take advantage of an IVA. An IVA is an Individual Voluntary Arrangement that allows individuals to make repayment proposals to a creditor using the services of an Insolvency Practitioner.

An Individual Voluntary Arrangement Can Help Your Finances

Taking advantage of an IVA is a way to preserve your credit score and help you avoid a blight on your financial record. The IVA was established in 1986 as part of the insolvency act. An IVA has been used successfully by many people to get control of their debts.

Besides using an IVA there are other things that can be done to help repay debt and avoid having to file for bankruptcy. One of the most important things is to keep up with payments. Credit cards, especially, should be paid down as quickly as possible. This is because credit cards are often the debt that carries the highest interest charges. Switching over to a lower interest card is a good way to make inroads into paying off the balance.

Missed payments are noted by credit reporting agencies and each time this happens, your credit score goes down by a few points. Having a low credit score makes it difficult to get loans such as mortgages and car loans. If you do obtain a loan while your credit score is low it means you will only get sub-prime loans which come with sky-high interest rates.

It may be possible to consolidate the most expensive debts into one large loan since this is likely to have a much lower rate of interest than debt such as credit cards. When the debt situation is dire, the only loans that should be taken out are the ones to pay off existing high-interest debt. If you are having trouble making monthly payments to your creditors, it is essential to call them and let them know.

It may be possible to arrange for lower monthly payments or to have the interest on the account frozen. There is another option that allows you to freeze the account for an agreed upon period. During this time you could pay only a small fee, such as £1 per month, until your finances have been sorted out.

Free Credit Counseling

If your creditors are not receptive and you are still struggling to pay your debt, there are charities that can help. Consumer Credit Counseling and asCredit offer free and confidential advice and they can be contacted via Freephone. When you contact these charities they help you through a range of solutions that are appropriate for your level of debt.

This may include a DMP or Debt Management Plan that is paid directly to the charity or another company that has arranged this plan for you. They will then distribute the payment amongst your creditors in agreed upon proportions. All these services should be free of charge to you and you should never have to pay a fee for this type of debt advice. Taking these types of actions should help get the debt under control before it is too late.

Want to Get Out Debt? Ready for Zero Can Help

ready for zero debt reduction tool review

Getting rid of debt is a goal that many people have and yet so many have a problem getting it done. One reason is that it can be overwhelming to find the right place to start. Should you go for the debt with the highest interest or should you start with the lowest balance? As more and more companies are offering help, I thought I would review a tool that is currently gaining some traction in the personal finance industry and fans of its service –Ready for Zero.

ready for zero debt reduction tool review

Basically Ready for Zero helps users take all of their debts and helps them organize and manage them online on one site. Once you sign up, you can get all of that data pulled in and create a personalized plan to get you out of debt faster.

What Ready for Zero Can Do (and What It Doesn’t)

If you are looking for a ‘debt relief who negotiates with your creditors on your behalf, Ready for Zero is not your spot. They have the online tools that can help you create a sustainable plan. The free option is a wonderful tool, I’m using it for paying down the student loan during The Debt Movement.

For those needed more assistance with managing their debts, there are two paid options – Ready for Zero Plus ($4.99/month) and Ready for Zero Plus Bi-Weekly ($4.99/month plus a one time $50 set up fee).

How Ready for Zero Works

Ready for Zero is pretty straightforward when it comes to how it works. 

  1. Grab all of your accounts into one spot. When you sign up, you can go ahead and link all of your debts into one spot and quickly see all the necessary information about your accounts, like the balances, interest rates, and payments.
  2. Create a realistic debt reduction plan. Using the data given along with the online tools you can find the optimal monthly payments you need to make to reach your goals.
  3. Make payments on your debts. Follow your personalize plan and track your progress online or with Ready for Zero’s mobile app.
  4. Reach your goals. Stick to the plan and watch your debts decrease and eventually be paid off.
It took me about 5 minutes to get my account started. With your personalized plan, Ready for Zero includes suggestions on how you can save money which can then be used to pay down your debts faster (this is one way they make money). They have also partnered up with LendingClub to offer loan consolidation to get a lower rate for some users.

Who Is Ready for Zero For?

I think if you are someone who is sick and tired of being in debt and want to come up with a plan that you can keep, the Ready for Zero is a fantastic tool for you. Whether you go for the free or paid option, you can get your finances squared away. In addition to the resources they have on their own site, Ready for Zero has many partners, including Steve Rhode from Get Out of Debt who can answer your financial questions.

Ready for Zero provides the tools to help those motivated to get rid of their debt.

Thoughts on Using Ready for Zero to Get Out of Debt

I know there a lot of people who would like to get out of debt, but don’t know where to start. I think Ready for Zero can be a great option for them. While the paid versions have their benefits, I recommend trying their free option first. I have found it quite handy and perfect for my needs. If you’d like to try it out, you can sign up for an account with Ready for Zero today.