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Ask HN: How do you manage your financials?

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Re: Ask HN: How do you manage your financials?

#81

Post by solarkraft »

hackbinary wrote: post #72
jmeyer2k wrote: post #61

Earlier quoted context omitted.

Investing in an index fund consistently gives returns of about 5-10% a year. This turns out to be a LOT of money in the long run (1.1 ^ 30 = 20x). Trying to time the market is a bad idea. Picking individual stocks is a bad idea. This is assuming your main goal is returns on your investment. Picking individual stocks or even 30 stocks is basically gambling. Really recommend reading "A Random Walk Down Wall Street": ht…

It depends on which index. The Dow Jones is an exceeding poor index and a good actively managed fund will out perform it easily. The Dow does not take into account market cap or float, and when a security comes off of it at $5 a share and a new one goes in at $105 per share, then the index jumps $100 in value. The S&P is better, but managed funds are usually better.

Interesting that you claim that, since I usually only hear the contrary (actively managed funds don't perform better and the fees are too high).

Does anyone have specific data on this? Does anyone

Re: Ask HN: How do you manage your financials?

#82

Post by monksy »

jmeyer2k wrote: post #73
tempsy wrote: post #65

Earlier quoted context omitted.

I'm so tired of these types of comments on HN that say investing in individual stocks is like gambling. It's such a tired piece of advice. Don't invest more than say, 5%, in an individual company, but choosing a selection of high quality companies that you believe in is not in any way like going to the roulette table.

It depends on the time-frame you plan to invest. If it's a short time frame, investing in individual stocks can be OK. There's just so many variables that go into the price that something that causes the stock to go up/down 20% can be completely unforeseen. A broad market index won't have these weird fluctuations. Almost every single market strategy underperforms broad market indices in the long run. Even hedge funds…

> it's a short time frame, investing in individual stocks can be OK.

And then your gains are cut by transaction costs, opportunity costs and short term gains.

Re: Ask HN: How do you manage your financials?

#83

Post by siavosh »

I use one of the robo-advisor apps (starts with W), and link all my accounts to it, and constantly play with it's retirement forecast calculator--it's the most sophisticated I've seen so far. Would love to use a second and even third one to see how much their forecasts differ.

Re: Ask HN: How do you manage your financials?

#84

Post by rgharris »

jcranmer wrote: post #66
rgharris wrote: post #12

Lots of reading (books, blogs, etc.) has been helpful for me the past few years and it seems like I pickup new things all the time. A few things I use/reference: - YNAB (You Need A Budget) - budgeting/tracking app, plus lots of great content on how to use the software and generally manage your budget/expenses - /r/personalfinance subreddit - checkout their wiki [1] and flowchart [2] in particular for a really helpful…

The /r/personalfinance flowchart is actually the best summary I've seen on the priority on spending. Some comments I'd add: * If you run out of money before getting to the employer retirement match, you are living beyond your means and you need to rectify that ASAP. * Avoid credit card debt especially; the interest rates are not in your favor. * If you're making tech sector salary, it's probably best to maximize Roth…

All good points. Roth vs traditional can be complicated when you think about the long term possibilities (change in tax rates, early withdrawal, lower/higher income in the future, etc.) but definitely max out Roth/Traditional/Backdoor Roth IRA if at all possible after getting max employer 401k match. I like the idea of diversifying with pre and post tax retirement options to an extent. Backdoor Roth IRA is useful for high earners that don't qualify for a Roth IRA or Traditional IRA deduction.

Re: Ask HN: How do you manage your financials?

#85

Post by bryanmgreen »

wtvanhest wrote: post #64

Disclaimer, I work in corp finance: My wife and I have what I believe is a novel approach. Our requirements were low mental overhead, but effective. 99% of what you read says to make a budget and follow it. Well, that sucks and is zero fun. It also doesn't apply to people who's income is significantly higher than their expenses, or people who are paying off lots of student debt or saving for a house etc since it just…

I do the same, but bi-annually. Less micro-managey for me.

Personally, didn't feel there was enough fluctuation to justify 3 month intervals.

Re: Ask HN: How do you manage your financials?

#86

Post by jotakami »

nicolaslem wrote: post #62
jotakami wrote: post #38

Earlier quoted context omitted.

Yeah I bailed on Quicken about 5 years ago and never looked back. Using GnuCash now, and it’s awesome because I can store the data in a local Postgres database and do whatever I want with it.

I love GnuCash! The learning curve is a bit steep if like me you have to learn both the software and the concepts of double entry accounting. It took me a few iterations to get it right but now that it's rolling I couldn't be happier. Since my girlfriend and I share some of our common expenses I developed a web app à la Splitwise/Tricount that can export transactions to GnuCash. It works very well but I never polishe…

Oh man, my current project is to automate accounting for my cryptocurrency trades in GnuCash. I trade very high volume, futures and options, so being able to run a cron job to automatically pull the data from APIs, calculate gains, and load it into the GnuCash schema will literally save me hundreds of hours per year in accounting overhead. Once it’s done I bet I could easily sell it for $100s to other crypto traders.

Re: Ask HN: How do you manage your financials?

#87

Post by tunesmith »

I've recorded the date and amount of every contribution to my retirement savings. From that I'm able to calculate my all-time APY, and inflation-adjusted APY.

I used Banktivity for personal finances. I make sure everything is categorized.

Finally, I have a spreadsheet that calculates our monthly expenses (which I get from Banktivity) and knows the amount of retirement savings.

From those - our all-time APY, our savings, and our expenses - I am able to project what happens to our savings if we retire today, or what date we can retire if we want to always keep our savings above zero. It has an accurate social security model that assumes the trust fund runs out and we get paid at 80% benefits.

It's been a great exercise. The numbers are different (and more conservative) than most articles and web calculators counsel. Keep saving, don't rely on good investment performance.

Re: Ask HN: How do you manage your financials?

#88

Post by wtvanhest »

bryanmgreen wrote: post #85
wtvanhest wrote: post #64

Disclaimer, I work in corp finance: My wife and I have what I believe is a novel approach. Our requirements were low mental overhead, but effective. 99% of what you read says to make a budget and follow it. Well, that sucks and is zero fun. It also doesn't apply to people who's income is significantly higher than their expenses, or people who are paying off lots of student debt or saving for a house etc since it just…

I do the same, but bi-annually. Less micro-managey for me. Personally, didn't feel there was enough fluctuation to justify 3 month intervals.

Yeah, that makes sense. When we started 5 years ago we were recovering from me going without a salary for a year after I tried and failed at starting a company. Then we got married, then we had a baby. We had a lot of rapid change that happened very quickly so quarterly made sense.

After we buy a house, we will probably do it a year or so, then move to bi-annual.

Re: Ask HN: How do you manage your financials?

#89

Post by allovernow »

kevmojay wrote: post #47
allovernow wrote: post #6

I live well enough within my means that I don't have to bother with any kind of accounting. On a typical tech salary living in a relatively cheap COL area, I bought a house about half of the price I could afford. I exclusively purchase used vehicles (partly because I am am enthusiast and enjoy working on them, but even a 10 year old low mileage modern vehicle is pretty reliable and cheap to maintain), and I don't sho…

I agree with your conclusion but for me personally, I am afraid of spending even though I have money to spend. And when I do spend the money, it gives me a lot of anxiety. I started keeping track of my budget so I can comfortably spend without the stress.

Nothing wrong with being extra responsible!

Re: Ask HN: How do you manage your financials?

#90

Post by ecoled_ame »

bluGill wrote: post #45
uptown wrote: post #22

Earlier quoted context omitted.

> i don’t socialize I'm curious why you've made this choice.

I hope OP means something like I don't go to bars. Alcohol in a place that encourages you to stay around for a while is what passes for socialize to a large number of people. There are plenty of other social things you can do in life, but I've noticed that there is a crowd where none of them count. Either you sit in your favorite bar and talk, or you don't socialize. My time spent camping with friends is interesting,…

no i simply don’t speak to people casually outside of work. i just skateboard alone or explore or read or other solo stuff. i just don’t like being around people in a friendly manner.
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