Lots of activity this week, but a few very important posts I wanted to point out:
- Canajun Finances – discusses how time is the most important variable. If this isn’t intuitive to you, then please go read the article. The compounding effect of interest over time is huge. The takeaway point? Start early, and if not early, then start now – because time can fix a lot of things.
- Sustainable Personal Finance – talks about adjusting heat to save money. If you don’t have a programmable thermostat, consider getting one.
- Canadian Couch Potato – talks about why market beating strategies don’t last. His approach is to buy an index fund and hold, rather than trade. Over the long term this strategy has been shown to outperform 97% of other strategies (and the other 3% are just random). What happens is that the big winners one year become big losers the next. If you’d have simply bought the index and ignored your emotions to jump on something that sounds really really really good (can’t lose! or I’m losing! Panic and sell!) then you’d eventually end up with higher returns. Few investment advisors recommend this strategy,yet many academics and fee-only advisors do recommend it. Go figure.
Next week we’ll have a bigger roundup as on the 15th we have the “Blog for Financial Literacy” campaign where Canadian bloggers publish their single best financial tip. If you’re a blogger, consider signing up!
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