Letting the Wins Add Up

I recently received a call from a friend. He had a question. “I just got a $110k inheritance that’s sitting in my checking account. I need it in about a year for ______. I feel like I should do something with it between now and then. Do you have any good investing ideas?” It was an interesting question, and I had an immediate idea for him. 

I explained that if he opens a Vanguard taxable brokerage account, and deposits the cash but doesn’t actually invest it, he would receive risk-free monthly interest payments of about $500. I was anticipating an excited, dare I say giddy, response. However, he reacted with complete disinterest. “Nah, doesn’t seem worth the hassle.” Not knowing what his hangup was, I responded that I’d be happy to sit down with him to set it up…..it would only take 15 minutes or so. Again, he declined, stating it wasn’t worth the time and effort for “only five hundred bucks per month.” In a last-ditch attempt to change his mind, I reminded him it’s 100% risk-free, and he could take the money out whenever he wants. No bueno. He ended the conversation by saying he has a buddy with some good stock tips he might look into. Put another way, he just gave up $6,000+ of income that would have taken him a maximum of 15 minutes of his time……ouch!

Sometimes we’re so busy looking for the life-changing opportunity that we miss the little wins available to us along the way. Perhaps $500/month wouldn’t change his life, but what if he made this decision, then the next one, then the next one? Wins add up, big or small. Occasionally, I’ll take an inventory of a client’s wins over 6, 12, or 18 months. I’ll take stock of all the little choices they made and the net result of them. Each win, in and of itself, feels small. However, when viewed through a wider lens of cumulative impact, these small wins account for a significant shift in their finances. 

Mind those little wins. They add up fast!

This man’s story doesn’t directly impact you, but perhaps his non-decision raises your eyebrows. Yes, you can get a risk-free 5.25% by simply depositing money into a Vanguard taxable brokerage account. No strings, no commitments, no risk. Here’s how you do it:

  • Go to www.vanguard.com

  • Open a taxable brokerage account

  • Transfer your money into your new Vanguard account

  • DON’T invest it. Just let it sit there. 

  • Watch the interest payments land in your account on the last day of each month.

  • Transfer money back to your bank account whenever you want.

Or you can just shoot me a message and I’ll help you! It’s quick and easy.

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