My 2011 Personal Finance Toolkit

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What’s in my wallet?

What banks, investments, software, and credit cards make up my personal finance toolkit? I’ve had numerous people ask recently, so I thought I would share.

Here it goes…

Personal Checking & Savings Account = ING Direct

I’m still confused why other banks haven’t copied ING Direct unique ability to open sub-savings accounts. A long with having a very simple interface and high interest rates, this is the reason I bank with ING Direct.

A Local Checking Account w/ Reimbursed ATM Fees

I still find it useful to have a local bank.

A local bank of mine, STC Capital if you must know, offers a very nice checking account. There are no fees, I get my ATM fees reimbursed, I get a checkbook, and I  swing by once in a while to deposit a check. Plus, I enjoy walking into the place where I deposit money and knowing the people behind the counter.

Mutual Fund Family = Vanguard

The majority of my assets are at Vanguard.

I, as well as my wife, both have our Roth IRAs at Vanguard. My investment of choice is the Vanguard 2050 Target Retirement Fund.

Along with Roth IRAs, I have two other investments at Vanguard. I keep some cash in their Short-Term Bond Index fund. Plus, one of my first investments I ever made was into the Vanguard Total Stock Market Index, which I still own.

Vanguard is known for their simplicity and low-cost free structure. The one downside to Vanguard, is that their minimum to get in most of their funds is $3,000.

If you can afford it, in my opinion they are the best mutual fund family out there.

Brokerage Account = Sharebuilder

I don’t trade individual stocks often, but when I do I use Sharebuilder. (The most interesting man in the world reference was well intended)

I believe that the stock market is fairly efficient. Meaning, there are very few opportunities to take advantage of a low individual stock price. About once or twice a year though, I will see an opportunity come up and bet a very small portion of my assets on that stock.

For example, in 2009 I put $1,000 in a few banking stocks that I thought were way below market value. A few months later, I was able to sell for around a 50% increase. (I didn’t make any trades in 2010) I like taking risks, so I consider this a hobby and not investing. For this hobby of mine, I find Sharebuilder a great option.

I also find Sharebuilder a great option for opening a Roth IRA with little money upfront.

Cash flow Software = Mint

A cash flow software like Mint, which is free, is very useful to have.

The other day I needed to find out what my average expenses were from January to June 1010. Within 5 minutes, I had an answer.

Another feature of Mint’s that I love is its ability to track my progress towards achieving my financial goals. Once a month, I have Mint automatically email me my progress towards each of my goals.

Travel Rewards Credit Card = American Express Starwoods Rewards Card

After visiting a few forums, review sites, and asking friends who travel a lot what is the best credit card for earning miles, I found that The Starwood American Express Card is widely accepted as the best of the best.

At first glance I didn’t understand why. The Starwoods card earns points on a $1 spent, 1 point earn basis. This was the same as most other cards I looked at. What made The Starwoods card the best of the best is the generous transfer rules and the 20% bonus. Not only can you transfer points from their program to just about every major airline; you get a bonus while doing so. For every 20,000 points you transfer, you receive a 20% bonus.

Even though I’ve had this card for only 3 months, I already have enough miles for a free domestic flight. (A lot of the miles were earned from performing a few secret Jedi like tricks from reading The Frequent Flyer Master). I expect this card to be my primary credit card for some time.

Tax Software = TurboTax

This will be my third year using TurboTax software for my personal tax return. So far, it has yet to disappoint.

It’s easy to use. There are tons of checks and balances to make sure the information is correct. They keep my history from year to year.

I should keep this statement to myself but I don’t really mind doing my taxes each year. TurboTax makes things pretty easy.

Moving On

What’s in your personal finance toolbox and why is it in there?

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Photo by: Oskay

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Tagged as: banking, credit cards, recomendations, Taxes