Saturday, May 21, 2022

Higher Education Scam

For most students, a college education is not worth the cost they paid.

First, very few people can get a good paying job, i.e. support a family, with just a bachelor's degree in their major.   

Second, student loan debt payments far exceed what can be comfortably paid with a salary from an entry level job.

Third, the institutions that encourage the student to take or provide the loan have no vested interested in whether the student is able to pay back the loan.

Perhaps the government ought to pause the student loan program and address these issues before restarting the making student loans.

For more on  Reflections and Musings, check back  Saturdays for a new segment.

This is not financial nor education advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC

Stock Market No Longer in Easy Mode

Since the bottom in March 2020 until December 2021, the stock market was a money printing machine.   The overall market, especially growth stocks, only went up.   That ended with the start of 2022.

At first, I thought the market bottomed in late January, 2022.   I put additional funds in a Roth managed account.  That account is now down 16%.  In March 2022, I though the market had bottomed again and put additional funds into taxable managed account.   That account is now down 11%.    We have lost all of our gains from 2021 and starting to lose some gains from 2020.

At this point, I am making small trades based on earnings and make small buys on the dips and selling into the rallies.  Currently, I expect the market decline to continue for several more months, unless there is a major catalyst event to the upside, e.g. Russia ceasing the war with Ukraine.   In the meantime,  I am waiting for a further 10-20% drop before making any further large infusion of funds into stocks. 

For more on Reflections and Musings, check back Saturdays for a new segment.

This is not financial nor investment  advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC

Tuesday, May 10, 2022

Changing Car Rental Prices

Recently, I reserved a rental car for a trip a couple months in advance.   Before the trip, I checked the rental car prices and found that I could change to a lower price, for exactly the same rental period.   It seems that car rental prices change on a daily basis.   Several times, I was able to reduce our rental cost by $20 and up to $200 from the same rental car company.   It was worth checking every few days and learning if I could get a lower price.

For more on Ideas You Can, check back Tuesdays for a new segment.

This is not financial nor car rental advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC

Sunday, May 08, 2022

Going to the Dark Side

After an unsuccessful stint at shorting stocks in 2012, I started shorting stocks again in the past two week.  So far all but one of my shorts have been successful.   I expect the one unsuccessful short to become profitable this week, if the market continues its downward trend.

Here's what seems to be working:
  • Find stocks that have earnings reports during the week.
  • From that list, choose the high growth stocks. 
  • Choose stocks with higher prices, about 100 or higher.
  • If there is an up day, short a few stocks.  I usually choose 2-3.
  • On a down day, OK to short if it is the first down day.
  • Close out immediately if stock drops after earnings as soon as possible, even in pre market or after hours.
  • If the stock goes higher, I will hold for a few more days and may even short additional shares at a higher price.
So far, I have shorted AMZN, NET, DASH, SQ, ROKU and PYPL before earnings.   I shorted FB when it popped after earnings.    Most have fallen within a day, sometimes hours, after shorting.   Some fell by as much as 15%.   At this point ROKU is the only position in which I am losing money.  I could have closed it for 1.5% gain, but got greedy and waited for it to fall further, which it never did.   

To note, I am usually only shorting 1 share since I am learning.   Occasionally,  I will sort an additional share if the stock goes higher, as in the case of ROKU.

This week, I am considering shorting COIN, which has earnings after hours on Tuesday.  I will definitely short COIN if the market rallies on Monday, but a rally looks unlikely based on the current futures.

For more on New Beginnings, check back Sundays for a new segment.

This is not financial nor investment advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC

Thursday, May 05, 2022

Signal 30 Film for Potential Borrowers of Student Loans

When I took Driver's Ed in High School, we were shown a 30 minute film titled Signal 30.   It was produced -1959 by the Mansfield, OH police highlighting the severity of accidents when not driving safely.  Although it seemed extreme and unlikely, I remember thinking I never want to be in one of those accidents.

IMO, a similar type film ought to shown to potential student loan borrowers.  The film should feature the many student who complain that student loans have prevented them from a lifestyle they desired:  buying a house, getting married, having kids, taking vacations etc.   They also can talk about how they often have to make choices between food/rent and paying their student loan.

After watching this film, potential borrowers should be show what they can expect to earn after college and how much they will have to pay towards student loans before their other living expenses.  Students can then determine if they will be another story in the movie or if the loan will be worth it.

However, no higher education institution will do this since a majority of students would likely decide to not take the loan. That would reduce the number students able to attend college.   Conflict of interest.

 And if they do take the loan, they will know there won't be any forgiveness if they end up like students in the movie.

The mantra for student loans should be:  Just Don't.

For more on Crossing Generations, check back Thursdays for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC

Wednesday, May 04, 2022

Forgiving Student Loans Rewards Poor Financial Decisions

"In politics, stupidity is not a handicap."  - Napoleon Bonaparte

AOC's latest comment on forgiving student loans, to those that paid off their loans:  "We can support things that we don't directly benefit from."   That is true.  But taxpayers shouldn't be asked to support the voluntary financial stupidity of others, whether they be individuals, banks or car companies.  

Here's the irony of AOC requesting that her own student loans be forgiven.   Even though AOC owns a earns $174,000/year, owns a Tesla and maintains two residences, she has chosen not to make regular payments on her approximately $19,000 outstanding student loan.   She just continues to advocate for $50,000 student loan forgiveness, which would benefit her.

Sorry, anyone that can afford a Tesla doesn't need me to support forgiving their student loan debt.

For more on  The Practice of Personal Finance, check back Wednesdays for a new segment.

This is not financial, educational, nor political advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC

Thursday, April 28, 2022

Great Advice On Whether to Take a Student Loan

Here's an article every parent and child considering attending college should read.


TLDR:  Just say no.

For more on Crossing Generations, check back Thursdays for a new segment.

This is not financial nor education advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC

Saturday, April 23, 2022

On Solving the Student Loan Debt Problem

 “If I had an hour to solve a problem I'd spend 55 minutes thinking about the problem and five minutes thinking about solutions.” ~ Albert Einstein

Here's how I would define the problem:

We give unlimited loans to 18 year olds who may choose a major that is unlikely to lead to a job that pays enough to easily cover the loan payment after normal living expenses.

My solution is to gather the data on pay that graduates of different majors get from their jobs.   Normalize living expenses for location differences.  Calculate the maximum loan payment a graduate can make, assuming wage growth over 10 years.   Set a maximum loan amount for that major by school.

Seems relatively doable to me.

I would do this work before forgiving any student loan debt.  Otherwise, student loan debt will become an issue again in the future.

For more on Reflections and Musings, check back Saturdays for a new segment.

This is not financial nor education advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC

Wednesday, April 20, 2022

Avoid Getting a Student Loan

"I guess some mistakes you never stop paying for." ~ Roy Hobbs in The Natural

In my humble opinion, student loans are one of the biggest financial scams that is legal.  Student borrowers are not evaluated on ability to repay the loan.  Students are told the loan is an investment.  Students are encouraged to take a large a loan as needed to pay college costs.  Who is advising student borrowers?  It's usually the educational institution receiving  the money.

What should a student do if they can't afford a going to a college of their choice?   Choose a cheaper college is the first option.  If all four year institutions are too expensive, choose a community college for the first two years, live with parents and transfer after two years.  Or start working, go to college part time, and even have your employer cover part of all of the costs.  Finally, join the armed services and afterwards, go to college on the GI bill. All these options enable a person to get a college education.

The best part is one can avoid, or at least minimize the amount of, student loan debt.  This would prevent a student from becoming one of the many overburdened by student loan payments.

For more on The Practice of Personal Finance, check back Wednesdays  for a new segment.

This is not financial nor education advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC

Wednesday, April 06, 2022

Buy Low and Sell High

"In theory, there is no difference between theory and practice.  In practice, there is." ~ Yogi Berra

 A great investment adage is " Buy low and sell high."    The trouble is that the advice is very difficult to execute.   The results is traders and investors often buy high when the market is euphoric and sell low when the market is depressed. 

Here's how I try to manage keeping my emotions in check:
  • We have a core portfolio that we do not trade.   These are my wife's accounts, in which her holding period is forever, and our managed accounts.  For the managed accounts, I will sell periodically to take profits, but will  not go below the investment minimums.   Thus, we are always "invested in the the market" with part of our funds.
  • In our trading account, I am biased towards buying when the market declines and biased towards selling when the market rallies.
  • Since equity trades are commission free, I will scale in when buying, as little as one share at a time and scale out when selling, as little as one share at at time.  That way, I don't feel regret if the stock falls after buying or rises after selling.   I still have more to buy or sell.   The downside is I only buy a few shares at the bottom or only sell a few shares at the top..
It has been working for me in the 2022 kangaroo market.   Of course, it will probably only keep working, until it doesn't.

For more on  The Practice of Personal Finance, check back Wednesdays for a new segment.

This is not financial nor investment advice. Please consult a professional advisor.

Copyright © 2022 Achievement Catalyst, LLC