MYM Mailbag # 1

Posted by Frank

July 23, 2008

We weren’t sure what to expect when we decided to open up our mailbag to you, the readers. Frankly, we were worried that we wouldn’t get any responses. We were more than happy with the number of great questions that came in; it’s great to have such active readers! We still have a few more that we plan on answering next week, and hope to eventually turn this into a weekly topic. Because the questions really let us know what you want to read, it also gives us a great idea of the type of audience we are writing to. Please, keep the questions coming, we will continue to answer them the best we can.

I recently started a new job; the benefits are different than my previous one. They offer a 401(K) match, as well as an employer paid pension. Because they offer a pension, should I even be putting money in the 401(k)? - Steve

Whatever you can afford to put into the 401(k), I would suggest doing. You didn’t mention how much the match is for, but I’m guessing it’s around 2-6%. At the very least, try to put away the exact amount as the match. For example, if the match is 4% of your pre-tax salary, put exactly 4% into your 401(k). It may sound like a significant amount, but I think you will be surprised how affordable it is. Any match is free money from your employer that will grow substantially over time, try to at least match their match!

My current bank offers a decent interest rate on my checking account, but I have noticed I could earn an additional 1.5% if I switch banks – is it worth it? - Lonnie

I’ve actually asked myself the same question. It’s very tempting to try switch and always be getting the most for your dollar, but I think the reality is this is probably not worth it. For one, banks often switch their rates at various times. So you may find yourself wanting to change back to your original bank, because they are now offering higher rates. In addition, unless you have lots and lots of money stashed away in your checking account, a 1.5% difference won’t really make a huge difference anyways. It may be best to hold out and stick with your current bank, after all it’s probably not best to constantly be opening and closing bank accounts.

You guys talk a lot about finances, but what do you do for fun? - Kathie

Great question! Obviously I can only speak for myself with this one, but I’m happy to share. I’m a big Minnesota Twins fan, so currently I spend a lot of time watching baseball. As unproductive as this might be, I really enjoy it, and it’s cheap! I’m kind of a project guy, so on the weekends I usually try to keep myself busy. Whether it’s trying to fix something small on our car, or tackling a home improvement project, I usually find something to do. My wife and I like to take small trips to surrounding cities like Annapolis and Baltimore for cheap little getaways. Our next trip hopefully will be a day driving around Virginia taste testing various local wineries.

What software/website do you use to track the gains and losses of your portfolio? - Anonymous

I use Google’s portfolio. It’s very simple to use and has the only the basics, which is kind of why I like it. Also, I like being able to log into my Google account from anywhere and see how my investments are doing versus using actual software that can only be accessed from your home computer. As of late, I really haven’t like to check on my portfolio at all thanks to the market! $