🛍️ How to save while spending 🛍️

Hi friends!

Welcome to Better Have My Money, my Monday night newsletter about stocks, investing and trying to get that rich life.

One cheeky way to save money is to not even realize you’re doing it.

Maybe it’s just me, but right now feels like an expensive time. Holiday parties, cheeky cabs home after the holiday party, a Vitamin C serum from a Black Friday sale — and I haven’t even started shopping for Christmas presents yet.

So I want to make sure when I spend, I’m also saving. Something for current Amber, something for future Amber.

Which… is actually possible, thanks to a bunch of different micro-investing and automatic savings apps.

Confusing term of the week: “micro-investing” — literally just investing (usually through apps) when you only have a few dollars to spend at any one time, rather than a brokerage that requires a minimum of a few thousand dollars.

There’s Acorns, which I personally use (sign up here and we both get $5). It costs $1 a month for the basic account, as does Stash, which I’ve also heard good things about.

Basically, when you buy something using a linked credit or debit card, the app rounds up to the nearest dollar and sends that amount to your account.

So, say you buy a $3.75 coffee (cortados are expensive). Then, 25c would automatically get collected by the app after you swipe your card. Some of them you can roundup further so it’s 2x or even 10x the amount (although I’m not sure how practical that is).

I’ve written about Acorns before. A little over a year ago I had $360 in my Acorns account, and was contributing $5 a month plus the roundups.

Right now I’ve got $1676 in my Acorns account. Now that’s not all from roundups — although I’ve made 899 round ups in total! — because I upped my extra payments to $20 a week.

I did this partly because Acorns charges $1 a month in fees, and I wanted to make sure I wasn’t losing all my growth on fees. My money has grown 6.71%, or $104, after fees.

The fees in these sort of accounts are quite a bit higher than if you just transferred $100 or whatever into an investment account each month. And while it’s being invested in a mix of ETFs and bonds, it’s not like an incredible money earner.

But, I personally find that I save a bunch of extra money without even noticing so it’s worth it as an additional little investment.

  • Other options include Qapital (in the past I used this to save for a holiday or short-term goal). Their basic roundup savings accounts cost $3 a month and the one that allows investing is $6 a month.

  • Friends swear by Digit for autosaving money (it doesn’t invest the savings, although it does analyze your accounts to follow your spending and just cheekily deducts savings regularly based on how much you can afford) which costs $5 a month.

  • Qoins uses roundups to pay off debt, which is particularly handy for anyone who is too nervous to start investing because they are paying off credit card debt.

  • For Aussies, there is Raiz — particularly important cause investing in Australia usually starts at $500 intervals.

These apps are also really helpful if your pay check is not super regular (if you’re a casual worker or freelancer) and therefore it’s harder to set up automatic transactions.

People often tell me that they want to invest but haven’t done it yet. These apps are also really great if you’re a bit nervous about investing and unsure if you’ve actually got extra cash to save or invest.

Automatic roundup apps are a really great way to show that… you probably can. It’s not going to replace a retirement fund or a large investment account, and yes it’s more for beginners that people with multiple investment accounts. But shit, sometimes just getting started is half the battle.

I’ve mentioned this a few times now, but the bushfires in Australia are really, really distressing (photos of Sydney look post-apocalyptic).

I suggest giving money to the Extinction Rebellion or any group trying to get the government to care about climate change before it’s too late.

Hope the rest of the week is clearer,

Amber Jamieson

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