Dropping Edward Jones and moving my money to Vanguard

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Vanguard investment strategies are all over the personal finance blogs. Automated dollar cost averaging into passive index mutual funds has a certain sexiness to it that I didn’t appreciate until after I did it. And once I did, dang it felt sexy.

Basically,  “lower fees, from computerized passive index investing versus active management, leaves more wealth for yourself, and in 97% of the cases, gives you better portfolio performance as well”.

For 8 years I invested with Edward Jones active mutual funds. And they did okay.

Beginning in college I read books and blog posts about personal finance, including I Will Teach you to be Rich.

I mainly changed my spending habits.

I was reluctant to change investment strategies.

After running my own analysis, I realized that excessive fees were costing me lots of money.

And I don’t want that to happen to you.

I was paying 5% load fees, 1.5% expense ratios, 2% dividend reinvestment fees, and account maintenance fees.

What I didn’t know was really hurting my investment portfolio.

But, I didn’t switch over because I believed I was paying for solid performance.

I had my reasons.

-I didn’t want to upset my broker at Edward Jones

-I didn’t want to lose money in taxes and fees

-I didn’t have any experience with Vanguard.

But when I read Money: Master the Game by Tony Robbins, and his chapter on fees, I realized I had to do something.

In 2015, I opened a Traditional IRA with Vanguard.

Then I tracked performance for 2 years and saw better performance in vanguard along with less fees.

Once I had that information I knew I needed to make a change.

I had wasted 3 years and hundreds in fees telling myself that I needed to switch.

But once you have momentum it’s hard to stop it. It’s why 2.1 million people still pay for AOL internet from a CD they got in the mail in 1998.

I Finally did an in-kind transfer from EJ to Vanguard. .

For a disclaimer: I am not an investment professional, and this is not investment advice. Past performance does not predict future performance. This is purely entertainment writing.

With that out of the way. Here are my takeaways.

The end of excessive fees

EJ Roth ira was $100/year. Bullshit.

Vanguard has no loads, and some of the smallest expense ratios in the business. With a minimum 3,000k to invest.

Processing fees to change over

$100 per account to roll them over. Bullshit but worth it to be rid of their loaded funds.

Forms to fill out

You only need a form from Vanguard.

I filled it out, signed it, and within 2 weeks my account was fully moved over to vanguard from Edward Jones.

I got a call from Edward Jones asking about canceling the auto draft from my bank. I told them to cancel it, said thank you, and got off the phone.

That was it from Edward Jones.

I spent 3 years procrastinating on it.

All it took was $200 to EJ, a 10 minute form, and a 1 minute phone call.

Finally high fees were a thing of the past.

Current management ratios

My current ratios range from 0.20% to 0.06% in the Vanguard funds I am invested in. 0.43% ratio for gold ETF’s.

Passive investment

Each month I have set amount of money taken from my bank account and processed without loads into buying Vanguard shares.

I did this before. But it’s still important to build that money machine as a young man. Time is on my and your side.

Warren Buffet wrote an Op-ed piece in 2008 during the tumultuous Financial Crisis. “Buy American. I am.”

The S&P 500 was a roller coaster that month. The largest percentage swings in history.

The day his article was published the S&P was at 909.53. His critics slammed him. But a 9 year Bull market vindicated him. Today the S&P stands at 2,500.03.

Linking up banking information

Takes a few minutes, but all they need is a banking account number and routing number. Set up an auto-investment and then lay back in a hammock.

Better Website

Easy to find portfolio breakdown and performance. Really good infographics and tools on the vanguard website for a passive investor. The Edward Jones site was clunky and hard to find real numbers.

That’s what I’ve noticed. I’m glad a made that change at an early age. I now I want to take a calculated risk.

Future investment plans

I turned 18 on the day of the largest point swing in S&P 500 history, -106.95.  This current 9 year long bull market will end. Everything that goes up will come back down. I’m preparing for it in the same way Mr Money Mustache has.

Recent books I read on Personal Finance and investing that were good.

Bachelor Pad Economics: Funny, engaging, actionable.

https://www.youtube.com/watch?v=jAf7I5gl72A

Money: Master the Game: Great All-Weather portfolio allocation strategy.

 

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5 Takeaways from the Art of Charm Podcast interview with Brett McKay

I look up to both of these guys. Having Jordan Harbinger and Brett McKay chop it up together for an hour was awesome. Here’s what I learned.

  1. Masculinity in Classical Greece was physical. Physical Strength is useful. This is manly because you can provide security to your family and friends. Increase you circle of protection. Barbell Training. I will look into the Starting Strength program Brett and Jordan talked about.
  2. Get outside of your head and just Act. I have heard around the web that confidence was not thinking. Just acting. When at the bar, its about just acting. Think afterword about what went wrong. Just starting is the hardest part.
  3. Me, Always, Everything think. Stop, and spin the box. Ask yourself questions. Is this really that bad? Have other people done this before? What can I learn from this? How can I slowly improve? Trust the Process and do what action you can take right now to get closer.
  4. Life isn’t about Facebook followers or personal branding. This blog isn’t about getting followers. I really only want to flesh out my ideas. When I write things down they stick.
  5. Be more useful. At work, at home and out with friends. I gained more satisfaction from fixing my creaky car door with some motor oil and a sander than I did skiing with my friend. Eliminating a small screeching door felt better in the long run. It’s about solving your problems and being better today than you were yesterday. I just got a promotion at work, and it’s important for me to learn everyday and get better. Lives are on the line.

Action items:

  1. Learn how to film youtube videos. Brett’s are really good.  His Grilling/Smoking series is awesome.
  2. Fix up my washer leak
  3. Fix my car headlight bulb

The Episode

 

How to stop biting your Nails: The Rubber band Approach

 

We are what we do. For 18 years I bit my fingernails. I was anxious about stuff and to temporarily alleviate the thoughts I bit my nails. It was an anxious habit and it sucked.

I was tennis player and sometimes I couldn’t play. I would bite them during lectures in classes I knew I needed to study for. I would bite them during scary movies.

I was self conscious of it, and each year made a resolution to stop that habit. I wanted it badly enough that I stopped being comfortably numb and took action, well many actions.

I tried using nail polish, habanero hot peppers, nail strengthener; all passive methods that didn’t work for me. Then finally I tried the simple rubber band. Having a rubber band on my wrist cured me.

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This method is simple: Snap your wrist when you bite your nails.Trust me, you will become hyper aware of biting your nails very quickly.

  • Have a thicker rubber band that fits comfortably around your wrist. Carry extras.
  • When you put your fingernail to your teeth…stop yourself, take a deep breath, and don’t judge yourself or be mad
  • Lift up the rubber band and snap yourself hard enough to sting the fleshy part of your wrist. Repeat it 3 times.

The important thing is too always have it on, and snap yourself each time you begin to bite your nails. This is negative reinforcement and believe me, it works.

You might think this is masochistic. But no one ever said changing your habits was easy. But once you win this battle, you gain confidence in yourself.

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From Charles Duhigg’s book, The Power of Habit

While breaking this habit, you will recognize the common thought loops that occur before biting your nails. Biting your nails is a symptom not the cause of anxiety. To eradicate the nail biting even further, you must address the cause. Those thoughts are reminders that you haven’t taken action. So take action.

After awhile you develop a new problem. You have to learn how to clip your nails, which is pretty annoying.

Bag Check: What to bring to a Tennis match in your Tennis Bag

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Day Six of the 2015 US Open at the USTA Billie Jean King National Tennis Center on September 5, 2015 in the Flushing neighborhood of the Queens borough of New York City.

I’ve been reading  Winning Ugly: Mental Warfare in Tennis by Brad Gilbert. This part stuck out to me.

The player who understands the significance of gaining a small advantage (and of doing so repeatedly) might still underestimate the role that tennis equipment can play in helping you win more matches. Yes, you can bring the bare minimum, but any player who is serious about winning will go beyond the bare minimum.

I decided to make a quick list for my old high school team. I did some extra research and found this explanation from Gonzo Tennis very satisfying. Answering the question. Why even care?

If you’re heading over to the public courts for a quick rally or match with a buddy then don’t worry about what you bring with you (apart from a racquet and shoes) as there is no consequence for quitting early due to equipment malfunction or injury. However, if you are going into battle, so to speak, where winning might actually matter to you, you should have your tennis bag packed with these just-in-case items. Obviously, preparing for every eventuality is impossible so don’t bother trying. Keep the following basics in your bag and you can feel comfortable that you have taken reasonable measures.

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10 Essential items

  1. Water, drink plenty before, during and after your match. Hydration is the key to good performance. Sip water on every changeover.
  1. Energy food: bananas, oranges, mangos, apples, cliff bars, granola bars
  1. Rackets, at least 2 rackets, in case you break a string
  1. Towels, 1-2 regular size towels to keep you dry
  1. Medical kit: Different types of bandages, neosporin, athletic tape, blister specific bandages, body powder, small pair of scissors, sunscreen, lip balm
  1. Dry tennis clothes: 1-2 spare TC tennis shirts, 2-3 pairs of dry socks, extra shoelaces, extra pair of tennis shoes, sweatbands
  1. Hat with a visor and sunglasses
  1. Over grips, in case yours get soaked or unravel
  1. Extra Shock absorber, in case yours flys off and you can’t find it
  1. A plastic shopping bag, for wet clothes, or for a makeshift cold pack

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Credit: Winning Ugly: Mental Warfare in Tennis by Brad Gilbert

Delicious routines: Why a Jazz drummer eats 2 Chipotle burrito bowls a day to explode his creativity

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2 Chipotle Bowls a Day: The (Delicious) Power of Routine

When I first read the headline I thought that’s a great rationalization for being obsessed with Chipotle. My next thought, I want Chipotle right now.

Before you also get the craving and leave know that this Jazz Drummer and Entrepreneur inspired me. A year ago I set a goal to write more. I accomplished that goal using his method for lowering activation energy and setting up an easy routine/system.

Yoni’s creative process begins with his Chipotle system to save time and mental energy.

“Anchoring your routine around something by eliminating unnecessary choices to consume and shift mental and physical energy toward the projects that truly deserve them.”

Routines provide stability and channel your energy.

Yoni’s 2 bowls a day Chipotle routine inspired me to set a writing routine while I was stuck working on a Drillship.

He makes an interesting analogy with jazz drumming: his fundamental drum beat is Chipotle. All the variations and creative fills occur because of his fundamental beat.

Besides making me want Chipotle, I reflected on the time I devote to planning, buying, preparing, cooking, eating and cleaning up for meals. This is probably why I write more offshore than when I am onshore. I love to cook, but it definitely cuts back available time and energy to write.

Achieving creative bliss by lowering Activation Energy

Yoni eats healthy delicious meals, then put his time toward being a professional drummer. When I first read this article about a year ago I wanted to begin writing more on my blog. So I decided to set up a system.

Write 2 sentences a day

If I wanted to write more each day I would, and I usually did. But setting such an easy goal made it laughably easy. And as my man Mr. Money Mustache has said,

small efforts, repeated over time, will almost always surprise you.”

Sometimes I don’t write on days, but I’ve never stopped by being discouraged because the goal of 2 sentences was so low.

Lowering the activation energy of those tasks by eliminating the excuse that I don’t have time has proved to be the catalyst for incorporating writing into my daily routine.

I have a word document saved on my computer called 2 sentences a day. I am now at 119 pages and 67,000 words.

Yoni has his 2 bowls, and I have my 2 sentences.

My preference at Chipotle:

Chicken Fajita Bowl with brown rice, black beans, corn salsa, tomatillo green salsa, lettuce and guac.

Always finish Strong.

The Yoni Dina Chipotle Routine on Art Of Charm.com

How Red Lerille Mr. America 1960, started Red’s Gym: The biggest and best gym in the South

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Reds started in 1963. His goal is to make an improvement every month. There have been 624 improvements since 1963. Today Red’s is over 185,000 square feet. Every time I get onshore I go here 4-5 times a week. Red has built a world class gym in the 214th largest city in the US. It’s an amazing place and an good story.

“This place started off like Red Lerille’s Health Studio, then it became Red Lerille’s Health Club, then Red Lerille’s Health and Racket Club, and eventually people dropped all that shit and called it Red’s.”

Red’s Keys to Success

1. Arrive on time, ready to work

From Red Lerille: Painting the town Red,

“Every day, Lerille rises at 2:30 a.m. and rides one of his six bikes to the club to open it at 3 a.m. He works out for about 90 minutes before he hops on his bike for about 45 minutes of cardio and then pedals home. He takes a shower, shaves, eats breakfast and then heads to the 7 a.m. mass at St. Mary’s Catholic Church, down the street from his home. After mass, he heads to the private airport where he hangars the antique airplanes he restores and flies one for about a half-hour. Then, he drives back to Red’s, usually arriving by 8:30 a.m.—about the time many people are grabbing their first cup of coffee for the day.”

Credit Lara Hale

      2. Say hello and goodbye

  Red’s has 250 employees. Guess who opens up the gym every morning at 3:00 am. Red.  He usually stays until 7pm, even on Sundays.        

         3. Make a change every month

“You gotta have a board, with some goals written down, you have to write your goals down.”

        4. Learn as much as you can

When I joined the gym he gave me the tour personally. He handed me a book One Summer by Bill Bryson. It was fun read and chronicled the crazy events of 1927; from Lou Gehrig and the Yankees to Charles Lindbergh. Not just into fitness, his hobbies are building airplanes and motorcycles.

       5. Stay in shape

He works out everyday. One of the pillar habits in The Power of Habit by Charles Duhigg is exercising. Exercise has ancillary effects in your life that moves you to accomplish all other goals.

 Tour of the facility and history of Reds.

 

Red’s is an anchor for Lafayette. It has

  • a basketball court
  • 4 large swimming pools
  • boxing ring
  • racketball courts
  • cafeteria
  • coffee shop
  • 2 yoga studios
  • Pilates stuio
  • Cycling studio
  • Outdoor obstacle course
  • Day Care
  • 6 squat racks and full sets of bumper plates
  • MIT which is basically its version of crossfit

Besides all that is has a world class tennis facility.

  • 20 outdoor courts (14 hards and 6 clay rubico)
  • 3 well lit indoor courts with a viewing gallery.

This place is amazing.Reds tennisreds 2

Two critiques I’ve heard are were the price and the bodybuilders. The former is an excuse, and the latter is an over generalization.

  1. Red’s over delivers on value. Those that say it’s too expensive just don’t want to go to the gym. That’s fine, but don’t tell me about how your free week at reds was amazing, and you really wish you could afford it. I paid a one time $230 joining fee. And I pay a monthly fee including meals and tennis court of around $80 per month. You get a world class facility for a low cost and it gets better every month. That’s a high return on investment.
  2. “Oh Red’s, isn’t that just a meathead gym”. It is a bodybuilding gym, but its a lot more than that. Red’s foundation is bodybuilding. He was 1960 Mr. America after all. Their are serious bodybuilders there and they do stand out, but to be honest they are maybe 5% of the total membership. And I’ve never had a bad experience with them. I think the critique is based on the assumption that if you are big you do steroids and act aggressive. I’ve found Red’s to be a community of like-minded people trying to improve everyday.

Compared to other gyms Reds is incredible for the value you get in return. You get a world class facility for a low cost and it gets better every month. That’s a high return on investment.