Archives for December 10, 2015

FileThis App Review: Automatically Backup Your Online Statements

“The editorial content on this page is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone.”

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A few months ago on my post about Paperless vs. Paper Statements, I received this helpful comment from reader Daveraham:

I like the services FileThis.com. It’s setup similar to MInt, where it stores account information, but instead of fetching dollar amounts and transactions, it grabs every statement available and stores them where you direct. Personally I store it an evernote account and then periodically pull it off to store on a removable HD that get’s stored in a fireproof box. Overkill?? Sure…. But its the point. You want to keep that snapshot of data for a long period of time.

I made a mental note to check the site out and… promptly forgot. I was again reminded in this Liz Weston article about apps to organize your financial life. In November 2015, FileThis announced their 2.0 version with new features. You can use the FileThis.com website, iOS app, or Android app (1.0 version only for now).

FileThis is now one of many “bill organizers” that ask for your account passwords in order to sift through your accounts and remind you of due dates. Personally, I don’t need or use due date reminders. I sit down at the end of every month, read through all my paper statements, track expenses, and pay my bills. I’m an old fart like that (although I do use free online billpay).

I previously shared that I maintain physical statements for critical financial accounts and have it mailed to a secure PO Box. But I also have several other financial accounts which are either dormant, temporarily opened for reviews or experiments, or have low balances which are set to paperless. Ideally, I would still log in and download those PDF statements every month and back them up. But I never do.

FileThis will log in and automatically download all your paperless statements and then save them to your cloud service of choice: Evernote, Dropbox, Google Drive, Box, Amazon Cloud, and more. You can even use their in-house storage (500 mb free). The cost options:

  • Free for up to six (6) connections. Checks weekly.
  • $2 a month ($20 a year upfront) for up to 12 connections. Checks weekly.
  • $5 a month ($50 a year upfront) for up to 30 connections. Checks daily.

Besides things like bank accounts, credit cards, and brokerage statements, FileThis will grab stuff from your mortgage provider, car loan servicer, cell phone bill, utility bills, insurance bills, and even online shopping accounts like Amazon. An added bonus is that they will even grab tax documents like 1099 forms.

I linked up a few accounts, the list is relatively extensive but it couldn’t find a local credit union. Here are some screenshots from my website and smartphone app.

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Remember that the actual files are on your cloud service. Here’s a screenshot from my Dropbox app. The files are stored in the folder Dropbox > Apps > FileThis.

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This is pretty cool. The initial download basically grabbed all the older documents that were available as well (up to last 3 years, supposedly). They’ll even grab PDF statements if you also get mailed paper statements (assuming they are available), giving you an additional backup copy.

By allowing backups directly to a third-party cloud service (Dropbox in my case), I will still have all of my online statements even if FileThis shuts down some day (remember Manilla?).

The trade-off here is that another FinTech startup has your account logins and passwords. Their security measures seem fair enough (encrypted SSL transmission, passwords are encrypted on server, the documents can be stored at your cloud service). I already track my paperless accounts in real-time with Mint, but I am willing to make this trade-off as I think it’s worth it to have my old statements backed up for me. (Why can’t Mint do this for me too?) The only other service I know that offers something similar is Finovera, but I think they store the statements on their own servers as opposed to your personal Dropbox.

As an existing user, if you sign up using my referral link, both you and I will receive an additional free connection (so you’d have a total of 7 free to start) and an additional 250 mb of free in-house cloud storage.

Amazon.com: Extra 25% Off Another Print Book

“The editorial content on this page is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone.”

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New code so you can get 25% off again. Good through 12/13 Midnight Pacific. Take an extra 25% off any book at Amazon.com with promo code 25OFFBOOK. Print books only, max $10 off, must by sold and shipped by Amazon.com. Valid until December 14, 2015 at 02:59am EST. This is a different code than the previous 30% off and 25% off coupons, so you can use it again.

Stack with your $15 off $60 at Amazon from American Express, 10% off Amazon from Chase Freedom, and 5% off Amazon from Discover (10% with Double Promotion).

Here are some recommendations for those looking to give or receive some financial inspiration:

Here are all my book reviews in reverse-chronological order.

My favorite book of 2014 was Dinner A Love Story. It has some inspirational material to help you cook for yourself and your family, along with the best compilation of weeknight dinner recipes I’ve read in a cookbook. They taste special enough (not bland or boring), but they also take 30 minutes. I still use it to this day.

My favorite book of 2015… I looked back at my book reviews and didn’t really have a strong favorite. I would say one trend is that I have become a fan of re-reading Vanguard founder Jack Bogle’s classic books. His old stuff has a lot of common sense reasoning that doesn’t always fit with today’s “one-size-fits-all” advice.

My 529 Plan Asset Allocation, Part 2: Glide Path

“The editorial content on this page is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone.”

This is a continuation of Part 1: Extension of Retirement or Standalone Portfolio?

If you’ve chosen a standalone portfolio for your 529 plan, every provider will offer you age-based portfolio that automatically adjusts based on the age if your child. In general, it starts out with mostly stocks and over time becomes mostly bonds and cash. This preset plan is called the glide path.

My biggest gripe about the glide path of most age-based default portfolios is their short holding periods for stocks. Nearly every one starts with a ton of stocks, and then quickly shifts to a ton of bonds. You’re basically hoping for big stock returns over a short window of time, which is more gambling than investing. Allow me to explain…

Here is the glide path for Moderate Age-Based Option of the Vanguard 529 plan, Nevada (click to enlarge):

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You start at 75% stocks, and then at 6 years old you are down to 50% stocks, and then at age 11 you are down to 25% stocks. So 25% of your portfolio only holds stocks for at most for 6 years. (Imagine if you contributed money at age 5.) Another 25% is only held at most for 11 years.

If you contributed equal amounts of money every year to this Nevada 529 moderate age-based plan, your average hold time for half your portfolio (2/3rds of the stock portion) is around 4-5 years in stocks. If you did a lump-sum in the beginning, the average hold time for half your portfolio would be 8.5 years.

Here is the glide path for Moderate Age-Based Option of the UESP 529 plan (Utah):

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You start at 80% stocks, and then at 7 years old you are down to 60% stocks, and then after another 3 years (age 10) you are down to 40% stocks. At age 13, you are at 20% stocks. That means 20% of your portfolio only holds stocks for at most 7 years. Another 20% only holds stocks at most for 10 years. Another 20% holds stocks at most for 13 years.

If you contributed equal amounts of money every year to this Utah 529 moderate age-based plan, your average hold time for 60% your portfolio (75% of all your stock holdings) is around 5 years in stocks. If you did a 100% lump-sum in the beginning, your average hold time for 40% of your portfolio would be 8.5 years.

Hold time vs. Investment returns

Here is a customized chart from PortfolioCharts.com that shows how past returns varied by holding period for the US stock market. (More info on these charts here).

Note that within 5-year and 10-year periods, there are lots of white and red squares which indicate periods of zero or negative inflation-adjusted returns. The longest drawdown was 10 years. Wouldn’t you like to have ridden that out with a longer holding time?

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Side note: Some people have criticized the sharp step-downs in the glide path. Vanguard addressed this concern in their 529 whitepaper ]. They ran back-tested simulations and found little difference between a smoothed and stepped glide path (click to enlarge).

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They concluded asset allocation was more important, which I agree with, but I wasn’t satisfied with the amount of evidence supporting their short stock holding periods. Sure, on average things look good, but in any given 5-year period things could be quite bad.

My alternative plan is more slow-and-steady, just like my overall retirement portfolio. I will start out with a balanced allocation at roughly 60% stocks and 40% bonds, as opposed to 75%, 80% or 100% stocks. I will then stay that way as long as I can so the stock portion will have a long holding period. Probably 6 years out from college, I will convert 10% from stocks to bonds/cash. So 60/40 > 50/50 > 40/60 > 30/70, and so on until I am at 100% cash at age 18.

I will also front-load my contributions so that they are within the first few years. I know not everyone can do that. This means I will hold all of my stocks for a minimum period of 10 years, with the average holding time closer to 15 years. Look again at the green/red chart above with a 15-year holding period.

I haven’t quite decided on the exact fund mix, but I have settled on using the Utah 529 plan, as it allows full customization and scheduling of your own glide path with a pretty solid menu of low-cost and passive investment options. Last part of this series will have the full implementation.

http://avtomaticheskij-poliv.com.ua

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