Not all investments are big. One favorite small investment I recently made is changing the oil in my car with Mobil 1 Synthetic. Why? Because, IMO, it’s a great investment. For an extra $30 I get two benefits.
- Vastly reduced engine wear.
- Longer oil life. (Meaning my oil will easily last 6,000-7,000 miles).
I don’t drive much compared to the average driver. I drive about 8,000-9,000 miles per year. But a lot of my driving is short distance, which is harder on the engine. However the essentially homogeneous medium-length hydrocarbon chains help my engine fare well against frequent “cold-starts.” That’s what research tells me. Additionally I inherited my first car that made it to 287,000 miles with no engine work, from my family who used synthetic oil in it.
Another frugal investment that worked out great for me was a 4-year electrical engineering degree from a state college. Could I have gone to MIT, Cal Tech, Stanford? Sure… until I ran out of money or went up to my ears and beyond with student loans. But, guess what? When I came to interviews, I got job offers when folks from these same great schools as often as not got rejection letters. Why? Because it is a waste of time to get an BSEE from a big-name school. I got a better undergrad education from a state school, at 1/5 the price! Talk about a good deal.
A third example of fiscal frugality is paying for good snow tires. I have a car I like, a life I like, and friends that I cherish. I find good/great snow tires to be excellent insurance. I want to keep these safe. And one easy way I can help do that is by having control and stopping power when the roads turn icy. I already drive 10-15 MPH below the speed limit in bad winter road conditions… but if I drive much slower I increase the risk of some huge, out-of-control, SUV rear-ending or side-swiping me. Having great tires (I love Blizzaks) helps enormously. The combination of driving for the conditions and being well equipped helps improve the odds. A very high ROI proposition.
Finally, in the same vein as driving, is NOT driving. I, for one, tend to believe the per mile statistics about driving vs. commercial flying. Hands down flying is way safer than driving. So, given a choice, I will shell out a few extra bucks to fly rather than drive for trips longer than about 700 miles. Do I hate security lines? Yes! Do I hate taking off my shoes and belt? Yes! Do I like sitting like a sardine in coach? Hell, no! But do I think it is safer to fly. Ya, ya betcha!
So, investing is as much about the little things as the big ones. Cheaper is not always better.
Call it a whim, but I’m short term bullish. I just put in a market order for 100 shares of TOT. It will execute the trade at market open tomorrow. I’m also very happy about my JNJ buy-write. It has worked nicely so far; I collected my dividend, and I’m about 50/50 to close out the option+position on Friday for a modest profit.
These are Crazy Ivan Account (CIA) trades. My “sane and steady” portfolio is much unchanged. I reallocated about 2% from equities to TIPS – a relatively big move by my standards. I also moved about $13K from equities to the newly re-opened Vanguard Convertible Securities Fund. I viewed this latter move as largely an equities to equities move. Both of these transitions are in my tax-differed accounts. My taxable accounts are largely unchanged except for certain modest real-estate-related actions.
The common theme of my recent moves is pursuit of yield. I’ve typically had a larger than typically overall cash holding in my portfolio. I’ve preferred cash yielding 3-4% to bonds yielding 4-5% simply because of the flexibility. In the same vein I’ve been pretty dogmatic about using any “spare cash” to pay down even my personal and company ~4-5% mortgage(s)/HELOC(s). But with long bonds yielding 3% and cash yielding next to 0%, I’ve had to reinvent my investing posture. Convertibles, munis, real estate, and modestly high-yield value stocks are gradually creeping into my investment mix.
Twitter
Feed