Can Money Buy Happiness?

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Greetings all, 

Thank you for joining us for another issue of the Bona Fide Monthly Newsletter. For this month, we’d like to wade into an age-old question, ‘Can Money Buy Happiness?’. At Bona Fide, we enjoy digging into the numbers and ensuring our clients use their financial resources as best they can to achieve their goals, but we also believe it is important to know why we are working to earn all this money. Will working more and earning more make us happier? Is it better to earn more or to work less while being more efficient with our resources? How much is ‘enough’? These are important questions and we hope the links below will help you think a little more about what makes you happy in your own lives. 

Read – 
Most people are familiar with the figure of $75,000 being the number often quoted as providing happiness. Turns out, it’s a little more nuanced than that. According to a Purdue study from 2018, $60,000 to $75,000 provides emotional happiness, and levels around $95,000 provide the opportunity for life evaluation. From Purdue “Emotional well-being, or feelings, is about one’s day-to-day emotions, such as feeling happy, excited, or sad and angry. Life evaluation, really life satisfaction, is an overall assessment of how one is doing and is likely more influenced by higher goals and comparisons to others.” Keep in mind that these are figures for an individual and the numbers would necessarily increase for families. Also creating a disparity in the numbers is the location in the country or world you live in. Spoiler alert…. “The study also found once the threshold was reached, further increases in income tended to be associated with reduced life satisfaction and a lower level of well-being.”

Listen – 
In doing research for this newsletter, we came across a great podcast called, Your Life, Simplified. Conveniently enough, they had an episode called, Can Money Buy Happiness? This is a good listen if you’re interested in another perspective, this time from Dr. Elizabeth Dunn, a professor of psychology at the University of British Columbia. We like this episode because it focuses on how to achieve “happier spending” and get the biggest happiness quotient out of each dollar that you spend. It’s a good thing to keep in mind when you are considering a purchase. Will this thing make me happier? If so, for how long and why? If you wind up deciding you have enough and it’s time to give back a little, you can also check out the following episode about community involvement and giving back. 

Watch – 
Still not convinced? Well, here is the video that started us down this rabbit hole. Titled, The Price of Happiness, author Benjamin Wallace sampled the world’s most expensive products, including a bottle of 1947 Chateau Cheval Blanc, 8 ounces of Kobe beef, and the fabled (notorious) Kopi Luwak coffee. If you’d like to read about those and other experiences Ben had, you can check out this GQ article. Both the article and the video are quite entertaining, so we highly recommend them. If money were no object, what is one thing or experience you would like to spend a large sum of money on?

That’s it for this month. We hope the above links gave you something to think about and reach out if you have any questions or comments. Also, if you haven’t, take a listen to our podcast, The FI Entrepreneur. We are closing in on a dozen episodes and think we are getting better with every show. What do you think?

Wishing you happiness, regardless of how much money you make, 


The Bona Fide Family

Gratitude

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Greetings all, 

The end of the year is upon us and collectively it seems like a good time to take a deep breath. For us at Bona Fide Finance and for many of our clients, it has been a very busy year with unprecedented challenges and adjustments to what our conception of ‘normal’ means. Lately, we’ve found ourselves drawn to focusing on all the things we have to be grateful for. In this last newsletter of the year, we would like to share some thoughts about gratitude with you. 

Read – 
It’s often said that “You’re the average of the five people spend the most time with,” (Jim Rohn), and we feel the same extends to creating a sense of gratitude in our daily life. Filling your mind and interactions with a sense of gratitude creates a tangible feeling that permeates into all of your interactions. And yes, it’s easy to be grateful in good times, but what about now, when things are less than perfect? This article addresses just that and points to the difference between feeling grateful and being grateful. If you are looking for some guidance on how to bring gratitude into your daily life, this article from Mindful.org has some great suggestions to increase your quotient of gratitude.

Watch – 
For this segment, we return to our friends at The Money Guy Show for their episode about ‘Keeping Up With the Joneses’. This show has a financial focus but the takeaways are relevant regardless of your financial situation. It’s so easy to focus on what the people around us ‘have’ that we get jealous or envious and then forget how lucky we are in our own lives. The major takeaway is that your mindset depends greatly on who you compare yourself to. Oprah Winfrey is credited with saying, “If you look at what you have in life, you’ll always have more. If you look at what you don’t have in life, you’ll never have enough.” Focus on the good in your life and that’s what you’ll see. If you focus on what everyone else has, you’ll never feel like you have enough. And remember, you never know what the Jones’ balance sheet looks like. 😉

Listen – 
Apparently, we’re not the only ones who feel like focusing on gratitude is worthwhile, because if you search for gratitude podcasts you are spoiled for choice. We’ve picked a couple that look promising. The first is The Gratitude Podcast. With a name like that, good audio quality, a host with a soothing voice, and quotes like, “It isn’t happiness that makes you grateful, it’s gratitude that makes you happy” we think this is a pretty good bet for some gracious listening. Our last link is to the Tom Ferry experience. His podcast focuses on mindset, business pursuits, and taking action to improve different parts of your life. We really enjoy his down-to-earth, no fluff approach and think there are a lot of great episodes here for you to enjoy on a number of topics. 

As we close out this last newsletter of the year, we would like to extend a warm and sincere thank you to all of you for your continued support and encouragement. We are grateful for the relationships you have built with you over the years and look forward to continuing to grow and thrive together. 

All the best in the New Year, 

The Bona Fide Family

Holiday Spending

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Greetings all, 

November is upon us and it feels like this year has flown by faster than ever. With great optimism, we at Bona Fide are hopeful that the worst of Covid is behind us and are looking forward to getting back to normal life. With the stresses of Covid receding and the end of the year and the holidays approaching, we want to use this newsletter to focus on what can be a stressful time of year for many people. Be it gift-giving, entertaining, or feeling compelled to travel, the holiday season can bring as many difficulties as it does pleasures.

Read –
This Forbes article by fellow financial planner Liz Fraizer is chock full of stats detailing different aspects of how much people spend during the holiday season and how they feel about it. The article estimates Americans spend nearly $1,000 per person on gifts and 18% are willing to toss budgets out the window especially when considering buying for children. Considering these sobering figures, it’s easy to understand that nearly 25% of people would be happy to opt out of gift-giving all together. Regardless of where you land on the gift-giving spectrum, it’s important to remember that you have control over how much you spend. This article from Yahoo Finance details how you can get a grip on holiday spending if you’d like to avoid overspending.

Watch – 
If you know you are prone to getting stressed out during the holiday season, learning how to say ‘no’ can be a powerful gift. This video from Ryan Holiday dips into Stoic philosophy to frame the prospect of saying ‘no’ not as a thing that limits you, but as something that sets you free. When you make the choice to say no to one thing, you are opening up yourself to saying yes to something else. As we enter the holiday season, this is a great time to take stock of what is important to you and take steps to make decisions that protect and support those things. If time with family is your priority, then don’t feel bad turning down social gatherings. If you don’t buy into (pun intended) the consumer aspects of the holidays, express that to your loved ones and opt-out. Give yourself permission to say no.

Listen – 
Our podcast link this month is to a list of holiday-themed podcasts. Some are aimed at meditation and guided sleep exercises, some focus on holiday specials and stories, and there is a nice selection of links aimed at family-friendly fun. This is a list you can use any time of the year, so we highly recommend going through it and enjoying some of the great (and free) content there. For a bit of more adult content, we have a couple of other suggestions. The first is from Planet Money analyzing the Holiday Industrial Complex. If you’ve ever questioned the ‘why’ behind all the holidays we have during the year, this might be for you. Finally, if you need a little more bolstering, here is a podcast from Farnoosh Torabi giving some good financial advice in regards to getting through the holiday season without blowing up your budget.

Thanks for reading! If you are feeling stressed out this holiday season, especially in regards to your finances, please reach out! That’s why we are here. We are happy to chat with you regarding your budget, spending, or whatever else is on your mind. If you’ve enjoyed this newsletter, feel free to share it with your family and friends. 

Happy Holidays!


The Bona Fide Family 

Entrepreneurship

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Greetings all,

We knew we wanted the focus of the October newsletter to be on entrepreneurship, but to be honest, we didn’t really know what direction to go with it. It’s something we discuss with a number of clients individually, but it isn’t something we’ve covered broadly with all of the families we serve. As is often the case when we are feeling a little stuck, it was Google to the rescue. A couple of searches in Google Trends showed that some of the most connected terms to entrepreneurship were centered around ‘challenges’, ‘classes’, and surprisingly (happily so) ‘teenagers’. As entrepreneurs ourselves through several businesses in our lives, this is a topic near and dear to us that we probably should have gotten into much sooner. So, if you’ve ever considered striking out on your own, let’s go!  

READ – 
Considering this newsletter aims to be educational in its nature, it makes sense that the first links cover the question of, ‘Can you teach entrepreneurship?’. The resounding answer from Entrepreneur Magazine and others is, ‘Yes!’. This article also outlines a framework for starting to think about your own entrepreneurial inclinations. Better yet, education doesn’t have to cost a fortune or happen in an MBA course. Estonia happens to be one of the most entrepreneurial countries in the world and they are growing the sector through a combination of government initiatives aimed mostly at younger people and networking. With sites like Teaching Entrepreneurship and increases in classes at college campuses around the country, there are more opportunities than ever to learn about trying your hand at something new (something the pandemic has made much more attractive for a large number of people). There are those that argue the best education in entrepreneurship happens with feet on the ground, but we advise caution before you decide to jump all in on something without first doing your homework.

LISTEN – 
If you do a search for podcasts based around entrepreneurship, you’ll find more than you know what to do with. Sometimes sifting through all the noise is as easy as going with the biggest name in the bunch. One of our favorite picks comes again from Entrepreneur.com. The name of the podcast is Problem Solvers, and forgive the redundancy, but it’s a well-produced and interesting podcast that focuses on real-life examples of people working through problems in their businesses. If you need a hit of inspiration, this is for you. With a history of only a couple of months, The Business Chop, is a new podcast that focuses on “everything from marketing, management, employees, outsourcing, technology, pricing and more”. The episodes we’ve listened to have been interesting and we are excited to see how it grows. This one may be best listened to with headphones. 

WATCH – 
When you’re ready to kick back and head down a YouTube rabbit hole, we’ve got a couple of links for you. The first one is a collection of 50 entrepreneurs giving advice. Some of the biggest names in business are artfully woven together into a collection of nearly 20 minutes of fantastic advice for entrepreneurs. The advice here works no matter what the size of the business or ambition and is well worth a watch. Our second video is a TED Talk from Bill Roche who has worked in classrooms for over 10 years in his PowerPlay Young Entrepreneurs program developing an entrepreneurial mindset in young people. Age is only a number and getting your mindset right before starting on any new venture is one of the most important things you can do. The more time you spend sharpening the ax, the faster the tree comes down. 

We would be remiss if we didn’t add here that we’ve started a podcast in this vein! Check out The FI Entrepreneur: Financial Planning for the Risk Taker wherever you listen. We’re dropping our trailer and episode 1 on Tuesday, October 5!

That’s it for October! We hope there are some valuable links here for you. Putting these together was a lot of fun. Please respond with a comment and let us know what you think! Feel free to share with friends and family and be well until next time. 


Sincerely yours,
The Bona Fide Family

Property and Casualty Insurance

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Greetings! This month we want to focus on something that often gets overlooked: property and casualty insurance. Property and casualty insurance covers your home, auto, and umbrella (excess liability) policies. Basically, it is a) the physical items in your life and b) your liability exposure. While it is not one of the most exciting subjects (as our first video will point out), it is incredibly important. Second only to estate planning documents, it is one of the most overlooked pieces of a client’s financial portfolio. As a result, we have adjusted more than 75% of our client’s property and casualty policies. So, what is the most common issue? Insufficient insurance protection in your home or auto policy. To be underinsured is a HUGE risk! Do yourself a favor – go through the links below and consider your individual/family situation.

  • Watch: The first is a quick and basic video just to get your feet wet. It goes over some common terminology and concepts. If you feel comfortable with insurance in general, feel free to give it a pass and check out our second video featuring The Money Guy Show. This gets further into depth and they provide great tips, such as videotaping your home for a visual inventory in case of a loss. It’s an easy watch without a lot of fluff or a sales pitch.
  • Read: Our reading this month comes from the Insurance Information Institute. While it is difficult in this realm to find impartial information – most articles or content available online are from said companies hoping to sell more policies – an essential piece to take away from the article is the correct amount of homeowner’s insurance to have (i.e. the actual cost of rebuilding the home; this is not the same as the real estate value, and does not include the land value).
  • Listen: Our final link covers another critical and often overlooked policy, the umbrella policy. Most clients assume that their current auto and home policies are sufficient, but they are usually not. This is especially true for clients with more considerable net worth, businesses, or assets like a rental property. If you are in an accident or cause injury or damages in excess of your homeowners or auto policies, an umbrella policy will step in to pay over the difference. This policy can be the difference between a bad day versus a devastating event.

As financial planners, it is our job to assist our clients in making good decisions. Unfortunately, when it comes to insurance coverage, it can sometimes be a struggle to fully convey the importance of something that often feels like a sunk cost at the end of the day. As stewards of your life savings and your family’s well-being, we cannot stress the value of appropriate insurance coverage enough. If you have any concerns about your current coverage, please reach out, and we will be happy to review your policies. It is always better to be safe than sorry!

We hope you’ve found value in this reading.  Please feel free to reach out with questions and comments.  Also, feel free to share this newsletter with your friends and loved ones!Make it a great month!
The Bona Fide Family

Inflation

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Greetings! Welcome to the dog days of summer! This year has flown by and as we look forward to a break in the warm weather, there is something else that seems to have everyone sweating: talk of inflation. From gasoline to lumber prices, it’s hard to miss the fact that prices are rising in all sectors of the economy. This month’s newsletter will provide you with some resources and information to help you better understand inflation, how it relates to your finances, and how to react to it.

  • Watch: Here we have two links: the first is from The School of Life and focuses on the basics of inflation. Start here for a quick primer on what inflation is and how it works. Once you’ve got a good grounding in the concept of inflation, you may be wondering how best to invest during an inflationary period. Our second video draws on quotes on inflation from Warren Buffet through the years. One of our favorite takeaways from the video is that one of the best ways to counterbalance the negative effects of inflation is to maximize your own talents and improve the skills you have to increase your earning potential. You may not be able to control inflation, but you can surely control how you react to it. 
  • Read: At Bona Fide Finance we take a long view of the market and believe in not letting short-term conditions dictate our long-term actions. That being said, it is nearly impossible to experience high levels of inflation without some (or a good bit) of worry about our portfolios. This Investopedia article discusses the effects of inflation on stocks. One of the key takeaways from the article is that value stocks perform better than growth stocks in times of inflation. If you have been working with us for any length of time, you are most likely to benefit from that. Hedges are another topic that often comes up when talking about inflation. This article from US News details 3 inflation hedges that might be worth considering. Finally, this post from Advisor Perspectives shows that the inflation numbers are primarily being driven by increases in auto, gas, and shelter prices.
  • Listen: If you’ve been watching the news or talking to just about anyone these days, it’s likely that you’ve heard the term ‘transitory inflation’. What exactly is it, and is the inflation we are experiencing now actually ‘transitory’? This podcast from Marketplace highlights what regular consumers think about inflation and what areas are being hit the hardest at the moment. Whether short-lived or longer-term, any kind of inflation is unwelcome and we hope this period of rising prices is as short-lived as possible.

Thank you for taking the time to read this month’s newsletter – we hope to have provided you with some valuable insights and information sources. This is not intended as investment advice. If you are thinking about taking action based on any of the information in this newsletter, reach out to us first so we can discuss and make sure your full financial plan is being considered. If you intend to share this content with friends and family, advise them to speak with their financial advisor prior to taking any action as well.

For our ongoing clients – keep an eye on your inbox for an additional article courtesy of DFA!

Make it an amazing month!
The Bona Fide Family

Financial Freedom (Financial Independence)

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Greetings! We hope you and your loved ones are enjoying the fullness of summer! One of our favorite events of this season is the Fourth of July – aka Independence Day. From that cue, we would like to talk about Financial Freedom, or Financial Independence (FI). More commonly known by the acronym FIRE (Financial Independence Retire Early), the FI movement has grown like wildfire over the past decade. Many people realize they really may not totally retire early (or ever!), so the focus of the movement is now more on the freedom or independence to perform work that you love or to not work at all.  The FI movement takes on a huge variety of forms, so there is sure to be something out there for you. 

  • Listen: This is kind of a two-for-one deal. It is an episode from a podcast called Afford Anything where the host, Paula Pant, interviews Joshua Sheets of Radical Personal Finance on his Financial Independence in Seven Stages. This is one of the first resources we dug into as we learned about the Financial Independence movement. It provides us and our clients a useful framework and vocabulary for discussing where they are at in their journey towards Financial Independence. If anything, take a quick look at the list of stages and see where you fit in.
  • Watch: Many people work their whole lives in the hopes of one day retiring and enjoying their ‘time’. The problem is that by the time they retire, they are often too old or infirm to really enjoy the time they have left. In this TED talk, Lacey Filipich shares her moving personal journey towards FI. If you’ve ever wondered if the traditional 9 to 5 is for you, or if the idea of a ‘mini-retirement’ sounds good, then this is a great watch. Lacey lays out the philosophy behind FI and her story is an important example of why taking some time for ourselves is probably the best thing we can do. If you are ready to trade the stuff you pay for, for assets that pay you, then take the time to watch this.  
  • Read: Sounds easy, right? Save a bunch, invest, then let the market and compounding interest do the rest for you. Well, the pandemic and recession have poked a couple of holes in the FIRE movement’s sails. Namely, if you quit your job in your 40s with a plan to live off the income from your investments and real estate holdings, what do you do if the market crashes? This NY Times article takes a look at some examples of people who had started their early retirement and how they have handled it so far. 

We hope you enjoy the links and your Fourth of July!. As always, feel free to share this newsletter with your friends and family and reach out if you have any questions. Is there a topic you would like us to delve into in a future newsletter? Please let us know and we will be happy to consider including it.

Make it an amazing month!
The Bona Fide Family

Budgeting

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Greetings! Well, June is upon us. We have survived tax season (minus a few hairs) and it’s time to look forward to the rest of the year. Summer tends to be a slower time of the year, where most people focus on family and vacations. So, we aren’t going to hit you with a topic too heavy this month and instead will focus on one of those everyday kind of things that really pays dividends if paid attention to: budgeting. People fall into two camps on budgeting: either you do it or you don’t. If you already love a good budget, we hope we will provide you with some more resources. If you are not budgeting, we hope you’ll find something here of interest that may inspire you to take action.  

  • Listen: Do a Google search for budgeting podcasts and you’ll come up with more than you can handle. What to start with? What ones are good? That’s where we come in. We have listened to a ton of these and here are a few of our favorites. You Need A Budget. Yes, our darling software has its own podcast as well. If you aren’t using YNAB, why not? Another podcast we really love is The Budget Couple. It’s really down to earth, relatable, and the episodes are around 20 minutes each (so it doesn’t eat up too much of your day). No matter how much money you make or where you are on your financial journey, you’ll find something to take away from this one. Lastly, we have the Clark Howard podcast. This is another podcast that delivers great content across a range of subjects that affect everyday life.
  • Watch: So, you’ve tried everything, right? Budgeting is just not for you, right? Maybe yes and maybe no. Maybe you just haven’t found the right style of budgeting yet. This video outlines 6 style of budgeting. It’s got a bunch of great information in it and a cool animation style, so it is worth your investment of 15 minutes. 
  • Read: This month, we might have been better off changing ‘read’ to ‘do’, because what good is a bunch of knowledge if you don’t act on it? It’s easy to listen to a couple of podcasts and watch a YouTube video or two and feel like you’ve done something good for yourself. It’s a lot harder (aka better) to actually take some steps and enact some changes in your life. Practical Money Skills is a website chock full of resources with a section all on budgeting. There are quizzes, articles, and calculators to help you get this piece of your finances in place. Finally, we’d be remiss if we didn’t mention another resource that many people love, Mint.com. It’s been around forever and speaks for itself. If you are looking for an app and like the price tag (free!) then Mint might be for you. Just don’t tell YNAB you heard about it from us. 😉

We hope your summer is full of fun and some relaxation. As always, feel free to share this newsletter with your friends and family and reach out if you have any questions. Is there a topic you would like us to delve into in a future newsletter? Please let us know and we will be happy to consider including it.

P.S. Ben, Deb, and their two girls are heading on an epic road-trip adventure covering the western states – you can follow their adventures here!

Make it an amazing month!
The Bona Fide Family

Social Security

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Greetings! We hope you are doing well and enjoying the spring weather with some great plans for the summer. For this newsletter, we have decided to focus on something pretty important and often misunderstood by many people: Social Security. There are many misconceptions out there about Social Security and a couple of good things to keep in mind when considering your situation. We won’t be able to cover everything, so if you have a question, please feel free to reach out, and we will do a follow-up to this or respond individually. Happy reading, watching, and listening!  

  • Watch: Here, we are giving you a double-shot. One of the things most people worry about is if Social Security will still be around when they need to draw on it. In fact, about half of American’s don’t have faith that Social Security will be able to provide for them in their retirement. The above link takes you to a CNBC video that delves into the past and possible future problems of Social Security. Supposing you want to skip to the ‘What’s next?’ part of the video, start at about 13:30. For your bonus video, we have a feature on working while collecting benefits. This may not apply to you, but it could for someone close to you. 
  • Read: Another common question people have is, “When should I claim Social Security?” We’ve linked this article from Investopedia to help answer that question. It is an in-depth article, so if you’re looking for a quick and easy answer, it’s to generally delay as long as possible, especially if there is longevity in your family history of life expectancy. The article also links to a breakeven calculator that will help you compare the breakeven age of retiring at age 62 with $1,500 per month or at age 66 with about $2,000 per month. In this case, you will have received roughly the same amount in total benefits by age 77. So, if you live longer than age 77, it would have been better for you to delay receiving benefits, if possible.
  • Listen: If the above wasn’t enough for you, the Social Security Administration offers a lot of content in audio format. So, if you’re looking for something for your next road trip, you can peruse the list and find something that appeals to you. If you want something a bit more riveting, this episode of The Long View takes the other side of the above point and explores why it is not always better to delay Social Security. FYI – that page and the podcast are chock-full of great financial topics, so you may want to check it out for more than just Social Security content.

We hope you have enjoyed this ‘light’ topic, and let us know if you have any questions! Is there a topic you would like us to delve into in a future newsletter? Please let us know, and we will be happy to consider including it.

Make it an amazing month!
The Bona Fide Family

Stimulus and Taxes

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Greetings! This year is flying by and it is hard to believe we are already in April! With the coming of spring, we are also in the midst of tax season (yay!) and the beginning of the new Biden administration. As with most Presidents, Biden has signed into law some pretty serious legislation during the first months of his term. The links in this newsletter will help you understand the American Rescue Act and the points that may affect you.  

  • Read: Our first link is a slide show giving an overview of 12 key tax points to keep in mind when thinking about the impact the American Rescue Act may have on you and your family. Some key points to pay attention to; income amounts in 2019, 2020, and 2021, Child and Dependent tax credits, and ways to adjust AGI if you are on the cusp of being phased out of stimulus money. There are key planning issues here, so get in touch with us if you have any questions. Additionally, check out this article from Michael Kitces, for a deeper understanding of the act and its ramifications from the High Nerd of all-things-planning.
  • Watch: Continuing with our tax focus, this video from Yahoo Finance, does an excellent job of breaking down the American Rescue Act’s effects. This video touches upon the Unemployment Benefits (expanded and partially tax-free), the Child Tax Credit (also expanded and now able to be prepaid), and the Dependent Care Credit which has been greatly expanded to help parents cover child care costs. The video also touches upon some great benefits for employers, so if you’ve got employees, you’ll want to watch until the end for sure. 
  • Listen: Our last link may be our favorite. It focuses on the nitty-gritty of how to make sure you get the largest stimulus check possible. It is also chock full of other resources including a stimulus check calculator, a Child Tax Credit calculator, and state-to-state tax guides for middle-class families and retirees. The beginning of the episode also focuses on various state plans for adjusting their taxes. If you only check out one of our links in this newsletter, then this is the one to click.  

We hope you have enjoyed these links and as usual, please feel free to forward this to your friends and family. Feel free to reach out with any questions or comments. We love hearing from you! Lastly, if we are doing your taxes and you haven’t uploaded your documents yet, please do so :)! Have a great day!

Make it an amazing month!
The Bona Fide Family