DietBet.com Update: My Weight Loss Profit Breakdown

Posted on June 10, 2015 // 4 Comments

db3

Back in early February 2015, I wrote about and started participating in a weight loss challenge at DietBet.com. As the picture above indicates, a group of folks (strangers or friends) agree on a weight loss goal, put money into a community pot, and the winners split the pot (after fees). It’s part gambling for profit, part community support group, and part behavioral modification nudge.

Knowing myself, I definitely hate losing money if I can at all help it. So far, it’s working! The idea that I would lose hundreds of dollars definitely kept me on track during times of weakness and doubt. (In addition to DietBet, I also did a simultaneous bet at similar site HealthyWager to up the total ante.)

Anyhow, since this is a money blog I figured I’d share some details about my financial results so far on DietBet. You pick from a list of open “games” with a goal of either losing 4% of your body weight in 4 weeks, or 10% in 6 months. I chose the 10% goal and joined The Transformer (Feb 5 – Aug 4), mostly because there were over 1,000 participants and I figured there had to be some people that would drop out. I know, it’s selfish, but it’s like poker – all your profits come from the losers! Indeed, DietBet uses the poker rake business model where they take a cut of the pot and thus never have to risk their own money.

Your weight is verified using a smartphone app (or website) that uploads two pictures each month: one with your feet on a digital scale, and another of your entire (lightly-clothed) body on the same scale. You are given a special keyword to ensure that the weigh-in is done during a 48-hour window.

I put up $25 a month for 6 months. I was offered one month free ($25 discount) if I paid $125 upfront, but since this is all about the behavioral component for me, I wanted the monthly charge to show up on my credit card bill. Players who have chosen to place their bets on a monthly basis may drop out at any time and avoid being charged for future, unplayed rounds.

There is one round per month; Rounds 1 to 6. Half of the total money bet is put towards Round 1 through 5. That is $25 x 6 / 2 = $75, split across 5 rounds is $15 per round. The other half is put toward the final weigh-in round. So $75 is bet on Round 6.

Four rounds have been completed so far, and here are my winnings. Here’s the graphic from my profile page that explains things pretty well:

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  • Round 1 Breakdown: $16.09 (7% ROI on $15 bet)
  • Round 2 Breakdown: $26.94 (80% ROI)
  • Round 3 Breakdown: $31.36 (109% ROI)
  • Round 4 Breakdown: $31.50 (110% ROI)

According to their documentation, the average “win” is 50% to 100% of your contribution. My personal results appear to be in line with these numbers. Based on the recent trend, I am not expecting the the future payouts to get much better than about 110% as these are probably the serious participants that will finish successfully. Additional people may also “catch up” and make that final Round 6 goal.

Dietbet does take a cut of the gross pot before distribution, between 10% to 25%. For my small monthly bet of under $100 a month, they will take a significant 25% cut. While I definitely think they should take a fee for providing this helpful service, I am conflicted as to what should be a “reasonable” fee. Keep in mind that taking 25% of the gross pot means that they usually take over 50% of your net winnings! (You are guaranteed never to lose money if you win, which otherwise technically could happen if enough people win.)

If I were to assume that I reach all my future weight-loss goals and a future 100% pot ROI, at the end of 6 months, I will have put in $150 and won $285.89 gross (135.89 in gross profit). After the 25% fee, I will take in $214.42 for a net profit of $64.42. That’s a projected 43% ROI on my $150 total bet. Hmm, that’s not too shabby. Perhaps I should have bet more money in retrospect. 🙂

But if I am honest, the fact that the last time I was this weight was about 15 years ago in college, THAT makes me happier than even winning a hundred bucks. In that very important aspect, I think DietBet has a great idea going. If I lost 9% of my total body weight, I’d still probably be okay with everything. There is also a supportive community aspect where people both commiserate and cheer each other on (which I did not actively participate in… not my thing).

You can read through all the Transformer rules here and how they discourage cheating and such. I’ll do a more complete final review once my 6 months is up.

Filed Under: Behavioral Economics, Deals & Offers //

Sling TV Review + Free Amazon Fire TV Stick or Roku Stick Promo (Updated)

Posted on May 19, 2015 // 22 Comments

slingfire

Updated review after 3 months of using Sling TV. Promo still live for a couple more weeks. Sling TV allows you to stream a package of major cable networks live over the internet. That means you can watch it on your smartphone, your home TV, or your laptop. No cable subscription required. Here are the channels included in the base package that runs $20 a month:

  • ESPN (live sports!)
  • ESPN2
  • CNN
  • Food Network
  • Travel Channel
  • HGTV
  • Cartoon Network
  • TNT
  • TBS
  • Cartoon Network
  • Disney Channel
  • ABC Family

Right now, if you commit to prepaying 3 months of Sling TV ($60 total), you can get any of the following deals:

That’s a $39 to $50 savings, depending on the deal, if you were looking for a modern streaming device. You must redeem the promotional code by June 5, 2015.

Alternatively, if you sign up at Sling TV directly first, you can get a free 7-day trial to see how it works for you. If are then ready to commit, then I would sign up for this Amazon promo using a different e-mail address as it says “new customers only”.

My 3-month user review of Sling.

  • Quality isn’t bad; my internet is only 15 Mbps on a good day but we usually don’t have more than one thing streaming at any given time. It looks especially crisp on my iPhone.
  • I’ve had a couple of crashes while channel surfing. This is on the Mac OS X desktop app.
  • You can’t choose to record shows for later viewing. It doesn’t work like a DVR. However, on select channels you can get limited replay of past episodes. From their site:

    Sling TV includes a 3-day replay feature that allows you to watch shows that have aired in the past three days on the following channels: HGTV, DIY, Travel Channel, Cooking Channel, Food Network, Galavision, El Rey, Univision Deportes, Universal Sports, and beIN Sports and we expect this list to grow. Sling International customers can enjoy exclusive 8-day replay on all international channels.

  • On the non-replay channels (including ESPN, ESPN2, ABC Family, TNT, TBS, Disney Channel), you can’t even pause a show for a few minutes and pass the commercials later, or have it blip back 10 seconds if you missed something. On the other channels listed above (Food Network, Travel Channel, etc), you can pause and blip backward. I was surprised how often I would try to click the pause button, with no response. Boo.
  • There is no contract and it is easy to cancel online under your account details. It just took a few clicks and 30 seconds. No calling in required at all, which means no Comcast cancellation nightmares. Note there are no refunds the 3-month prepay offer above. You can reinstate your account easily as well, similar to Netflix.

I did this free streaming stick promo, but after the 3-month comittment I cancelled my Sling subscription mostly due to the lack of DVR ability on all channels. I’ve had a TiVo since roughly 2005 and over the last 10 years, I have completely lifestyle-inflated myself such that I just can’t watch old-school TV anymore. It was too annoying not being able to pause a show, skip commercials, record a show, or blip backwards. I don’t watch that much TV, but when I do, I want it to be on my terms. (You may feel differently!) Now I primarily just stream kid stuff like Sesame Street via Amazon Prime Video.  

Filed Under: Deals & Offers, Frugal Living //

Verizon Wireless 8% Customer Loyalty Discount

Posted on May 9, 2015 // 3 Comments

vzIf you have Verizon Wireless but don’t already have a good employee or education discount on your plan, you may want to try this Customer Loyalty Discount at vzw.com/appreciation. You may qualify for up to 8% off of your monthly access fee. Note the following fine print:

*Discounts apply to plan monthly access fees of $34.99+ and data features of $24.99+ when added to a plan of $34.99+. On Share Everything and More Everything plans, discounts apply only to the Account Access fees. Prepaid, already discounted and promotional plans are not eligible for discounts through this program.

In addition, after reading through the Fatwallet and Slickdeals forum threads, please note the following:

  • Already discounted plans are not eligible (as noted in highlighted text above).
  • Submitting the form will attempt to apply the discount. Even though the page suggests that you are only checking your eligibility (“complete the form below to see if you qualify”), it will in fact attempt to apply the discount to your line immediately.
  • Your employee discount may be removed. Basically, be careful before submitting the form. If you have for example a 15% employee discount and sign up for this plan, the new 8% discount will actually replace your existing 15% discount. You will have to re-validate your employee discount if it is removed, requiring additional time and effort. A previously grandfathered employee discount may also be lowered upon re-validation.

Despite these warnings, I bet there are plenty of Verizon customers out there without a corporate discount that wouldn’t mind shaving a few bucks off their monthly bill.

Filed Under: Deals & Offers, Frugal Living //

Fandango Movie Ticket Discounts: 2-for-1 Fridays + 20% Off Gift Cards

Posted on May 1, 2015 // 13 Comments

fanplus1Back for Summer 2015. Fandango has brought back their Visa Signature summer promotion from April 24th to August 21st. 2-for-1 movie tickets on Fridays! You can also get 20% off Fandango gift cards which can be used any day of the week and can be instantly redeemable online.

2-For-1 Movie Fridays. If you buy two or more tickets via Fandango.com/visasignature on a Friday, one of those tickets will be free at checkout (up to $19.50 value, including Fandango convenience fee). Works with IMAX and other premium theaters. This should also work with the Fandango Mobile App “TIXPRESS” feature if you have a Visa Signature as the stored payment. No promo code required.

Tickets can be purchased on Friday for all Visa Signatures and Wednesday-Friday for Chase Visa Signatures, but it must be a Friday showing. Limit 1 complimentary movie ticket per Visa Signature card, per period of 30 days following the date of offer purchase. Maximum one (1) registered email address per seven (7) day period regardless of number of Visa Signature card or a valid U.S. issued Visa Infinite card.

Note that this means if you have more than one Visa Signature card, you can participate more often (especially if you use multiple e-mails). Check your credit cards.

20% off Fandango Gift Cards. You also get 20% off gift cards bought in $25 increments, which is basically $5 off $25 and valid any day of the week.

Limit four (4) discounted Fandango Gift Card purchases per Visa Signature card per month (maximum of $100 in Fandango Gift Cards).

Again, this is per Visa Signature card. The service fee can be annoying, but these promotions still make it a net discount. If you are a member of AMC Stubs, you can get the Fandango service fee waived at those theaters (membership costs $12 a year). I must say that being able to buy tickets from my phone is quite nice.

I’m not sure if these stack with other promotional codes, but their fine print says that they can’t be combined with other offers.

Filed Under: Deals & Offers //

AT&T Access More MasterCard from Citi Review – GSM Phone Offer (Up to $650)

Posted on April 26, 2015 // 63 Comments

accessmore180Our partner Citi has launched yet another new card, AT&T Access More MasterCard® from Citi. This AT&T co-branded card obviously targets a niche, but read on if you will be in the market for a new GSM phone in the next year ($650 is the full price of a new iPhone 6). As such, this card took a little extra research and analysis. Be sure to read all the details before applying, so you understand how to get everything possible out of this offer.

“Exclusive New Phone Offer” details. Yes, the offer screams “new phone”! But lots of ads say that. What kind of new phone? Does it include iPhone 6 or Samsung Galaxy S6? What strings are attached? Do I need to sign a contract?

  • You must spend $2,000 in purchases with your AT&T Access More Card within 3 months of account opening. As with other sign-up bonuses, this is the spending hurdle. The application page also says “If you buy a new phone now it will count toward the $2,000 in qualifying purchases!”. At first, I read this to mean “buy a phone and you don’t need to spend $2,000 anymore”. Nope. It’s just reminding you that if, for example, you buy a $650 phone on this card, then you’ll only need to spend another $1,350 on the card to meet the $2,000 threshold.
  • You can get any new phone on the AT&T website. Apple iPhone 6, iPhone 6 Plus, Samsung S6, Samsung S6 Edge, flip phone, whatever.
  • They’ll give you up to $650 back towards a new phone bought full price with no annual contract… At first this may seem like a negative, man I have to buy it at full price? But that’s actually a good thing when the credit is for up to $650! For example, an iPhone 6 starts at $649.99 and Samsung S6 starts at $684.99. (Taxes, shipping, fees, and wireless service not included.)
  • … which also means lower monthly bills! When you essentially bring your own device (BYOD) buy buying the phone outright, AT&T will give you lower bills in the form of $15 to $25 off each month on their Mobile Share Value plans. Also, the $40 per-line activation fee is waived when you buy the phone at full price (and is not waived for 2-year contracts). More details on this below.
  • Since you own the phone and are not on a contract, you can also unlock it for use on any carrier. You can find unlock instructions at att.com/deviceunlock. are the AT&T unlock instructions [pdf]. Postpaid customers have an active account for at least 60 days, with no past due or unpaid balance. Non-AT&T customers can request a phone unlock before activating the phone on an AT&T plan. After submitting your request, the unlock should be done within 48 hours.
  • You must buy the phone using their special link. After you buy the phone, then activate it on an AT&T monthly plans of you choice for at least 15 days. Remember, you’re not bound to a contract after that. It’s easier just to quote from their Terms and Conditions:

    You must purchase an eligible phone from AT&T with your AT&T Access More Credit Card from Citi (the “Card”) using the Phone Offer Link created individually for you. This link may be accessible to you in several locations including, but not limited to, your approval screen at the time you apply, an email welcoming you to Access More Card membership (if you provide a valid email address) and through your Online Account at citi.com/att. You may redeem the Phone Offer using the link at any time after your Card account opening. Once you have made $2,000 in purchases within the first 3 months of your Card account opening, and purchased and activated your eligible phone, Citi will credit your account for the cost of the eligible phone you purchased up to $650 (exclusive of taxes, fees, shipping and wireless service) within 1 to 2 billing cycles. If you choose to purchase an eligible phone which costs more or less than $650, your credit will equal the cost of the phone or $650, whichever is less.

Side question: How does paying full price for a phone compare with the subsidized 2-year contract or the AT&T Next plan? Most people don’t pay full price for a phone. It’s a lot of money. AT&T Next is basically like agreeing to pay full price for a phone but they let you pay in monthly installments instead. So the $650 iPhone 6 would $21.67 for 30 months (multiply that out and you get $650.10.) Nothing really special there. The traditional alternative is that you get a subsidized phone but you enter a 2-year contract at a higher monthly bill. Here’s how the two options compare:

  • The phone subsidy with a 2-year contract is $450, but you have a $40 activation fee. So the $650 iPhone 6 would only cost $200, plus a $40 per-line activation fee.
  • The monthly bill subsidy with a full price phone adds up to either $360 or $640 over 2 years. With the full price phone, there is no activation fee. If your Mobile Share Value plan comes with 6GB of data or less, you get a $15 discount per month per line. $15 times 24 months = $360. If your Mobile Share Value plan comes with 10GB or more, you get a $25 discount per month per line. $25 times 24 months = $600.

So if you compare the savings between the full price plan as 2-year contract, you’re either behind by $50 over two years, or ahead by $190 over two years. So worst case you’re behind by $50 at the 2-year mark, but if you kept your full price phone and cheaper-by-$15 plan for just an extra 4 months past the contract end date, you’d be ahead again.

Ongoing card rewards program highlights. This card also has a unique rewards program using Citi ThankYou points:

  • 3 ThankYou Points for every $1 you spend on purchases made online at retail and travel websites*
  • 3 ThankYou Points for every $1 you spend on products and services purchased directly from AT&T*
  • 1 point earned for every $1 you spend on other purchases*
  • 10,000 Anniversary bonus points after you spend $10,000 in prior cardmembership year*
  • $95 annual fee.

Here are snippets from the fine print that I think are helpful:

Retail websites are websites that sell goods directly to the consumer through an online website and include department store websites, specialty store websites, warehouse store websites and boutique websites. Travel websites are websites that allow you to book travel and include online travel agencies, hotel websites and airline websites.

AT&T purchases are AT&T consumer products and/or services purchased directly from AT&T. AT&T consumer products and services must be purchased from www.att.com, www.telephones.att.com, AT&T owned stores or AT&T customer service centers. Purchases from independent wireless dealers or AT&T resellers are not eligible, unless they are for payment of AT&T service.

That means you can get 3 ThankYou points per $1 of purchases at Amazon.com, Costco.com, Apple.com, Walmart.com, Target.com, Expedia.com, and so on as well at your AT&T monthly service bill. Please see my Citi ThankYou Premier card review for details on redeeming your ThankYou points for at least $100 value per 10,000 points, but note that the special 25% bonus on travel redemption only apply if you also hold the ThankYou Premier card (you can redeem points earned from this card). Throw in the even-more special American Airlines flight awards from the Citi Prestige card and those 3X ThankYou categories start looking even better.

Bottom line. This is a niche card for folks that will soon be in the market for a new GSM phone, especially AT&T customers. (Non-AT&T customers can request a phone unlock before activating the phone on an AT&T plan, after which you’ll have an unlocked GSM phone that can be used on another GSM carrier. Afterward, you’ll still need to activate an AT&T plan for 15 days to get the credit.) If that’s you, then the sign-up bonus is very generous – up to $650 towards a full-price, no-contract AT&T GSM phone. Looking at all the scenarios above, even in the worst case you’d be behind $50 after two years vs. buying new AT&T phone via 2-year contract. There is also the $95 annual fee. That’s still a net benefit of over $500 and thus one of the top credit card sign-up bonuses currently available. The card then offers you ongoing bonus rewards on AT&T service as well as an interestingly broad category of “retail websites”. However, that $95 annual fee is rather high unless you spend $10,000 annually on the card and get the 10,000 ThankYou point anniversary bonus to offset it.

“Disclaimer: This content is not provided or commissioned by the issuer. Opinions expressed here are author’s alone, not those of the issuer, and have not been reviewed, approved or otherwise endorsed by the issuer. This site may be compensated through the issuer’s Affiliate Program.”

Filed Under: Credit Cards, Deals & Offers //

Navy Federal Credit Union Youth Week $100 Bonus

Posted on April 16, 2015 // 4 Comments

navyfedlogoNavy Federal Credit Union has solid bank and loan products, including checking accounts with ATM rebates, competitive mortgage rates, and limited-time 0% balance transfer promotions. Membership eligibility for NavyFed is primarily restricted to Marine Corps, Navy, Air Force, and Coast Guard regular Active Duty and reservists, and Army and Air National Guard personnel, but also includes family and household members of existing NavyFed members and some civilian employees in the Department of Defense.

If you’re a member, the exclusive perks mean that you should sign up your kids sometime… and right now you can get $100 for doing so! As part of their Youth Week 2015 promotions, you can get:

  • $25 for signing up your child (under 18) for membership.
  • $25 for opening a Campus Checking Account for your child (age 14-17), which has no minimum balance requirements and up to $10 in ATM fee rebates per statement period.
  • $25 for opening a SaveFirst Account for your child (under 18) with as little as $5.
  • $25 for opening a reloadable prepaid Visa® Buxx Card for your child (age 10-17).

Expires soon on April 18th, 2015. Thanks to reader Charles for the tip.

Filed Under: Banking, Deals & Offers //

Best Interest Rates for Cash Reserves – Updated April 2015

Posted on April 12, 2015 // 13 Comments

percentage2Our family keeps a year’s worth of expenses (not income) put aside in cash reserves; it provides financial insurance with the side benefits of lower stress and less concern about stock market gyrations. In my opinion, emergency funds can actually have a better return on investment than what you see on your bank statement.

I don’t rate-chase nearly as much as I used to, but it still pays to shop around. Too many places are basically paying ZERO – the Megabanks, short-term US Treasuries, and money market sweep funds. Do you know what Chase offers on a 1-year CD? 0.02% APY. Bank of America on their 5-year CD? 0.15% APY. The highest money market mutual fund in the country yields 0.06%. My Vanguard Prime is at 0.01%.

Best Currently Available Interest Rates
Here is a brief summary of the best interest rates available on deposits backed by the full faith and credit of the US government. I will try to sort them from the shortest to longest maturities.

  • High-yield savings accounts. There are a variety of online savings accounts out there nowadays, with the highest ones earning around 1% APY. GE Capital Bank has an FDIC-insured Online Savings account paying 1.05% APY with no maintenance fees, no minimum balance, and no minimum to open.
  • Short-term guaranteed rates. Everbank Yield Pledge Money Market and Interest Checking account both offer 1.40% APY guaranteed (up to $50k each) for the first 6 months for new accounts. Since it is fixed, this is essentially a 6-month CD with a higher rate than any other 6-month CD rate out there and with no early withdrawal penalty to worry about. Salem Five Direct has an eSavings account that pays 1.10% guaranteed until 1/1/16 (~8.5 months left) but the rate is only available to new customers.
  • “Series I” US Savings Bonds offer rates that are linked to inflation. “I Bonds” bought right now will earn 1.48% total for the first six months, and then a variable rate based on ongoing inflation after that. You must hold them for a year, and if you redeem them within 5 years you lose the last 3 months of interest. While future rates are unknown, the net rate after a year is likely to be competitive with top 1-year CD rates at a minimum, while offering upside if inflation spikes. More info here.
  • Rewards checking accounts pay above-average interest rates, but with some risk. You have to jump through certain hoops, and if you make a mistake you won’t earn any interest all that month. Rates can also drop quickly, leaving a “bait-and-switch” feeling. But the rates can be high while they last. Consumers Credit Union offers up to 5.09% APY on up to a $20k balance, although 3.09% APY is easier to achieve unless you satisfy a long list of requirements. I list this one because the rate is guaranteed until December 31, 2015.
  • Certificates of deposit. If you have a large cushion, it’s quite likely to just sit there for years. Why not put some money in longer-term investments where you can still take it out in a true emergency and pay an early withdrawal penalty. Synchrony Bank (formerly GE Capital Retail Bank) is offering a 5-year CD paying 2.25% APY for $25k+ balances (2.20% APY for $2k+) with an early withdrawal penalty of 180 days interest. For example, if you withdraw from this CD after 2 years and pay the penalty, your effective rate earned will still be 1.69%.
  • Willing to lock up your money for 10+ years? Did you know that you can buy certificates of deposit via Vanguard’s bond desk? These “brokered CDs” offer the same FDIC-insurance and are often through commercial banks like Goldman Sachs. As of this writing, you can get a 10-year CD maturing 4/22/2025 that pays 2.95% APY. Prices will vary regularly.
  • How about two decades!? “Series EE” US Savings Bonds are not indexed to inflation, but they have a guarantee that the value will double in value in 20 years, which equals a guaranteed return of 3.5% a year. However, if you don’t hold for that long, you’ll be stuck with the normal rate which is quite low (currently a sad 0.50% APY). Think of it as a huge early withdrawal penalty. You really want to be sure you’ll keep it for 20 years.
  • Finally, how about something out-of-the-box? You can earn up to 2.25% APY within a 529 college savings plan (which can be opened with you as the beneficiary for now). FDIC-insured, and the rate is still pretty good even after a 10% penalty for non-qualified withdrawals.

How about my money? In terms of the opportunities above, I have opened an account at Everbank in the past for the promo rate and I have usually try to buy the max in US Savings I Bonds each year (no EE bonds, too long of a commitment). I don’t currently juggle any rewards checking accounts nor do I have any deposits with any other banks mentioned above. It’s just not worth it me to switch right now.

Besides some older CDs at higher rates, I keep a good chunk of my money at Ally Bank because right now they are the all-around “good enough” bank for me. Sure I could eek out 1.05% in a savings account somewhere, but Ally Online Savings is paying a 0.99% APY (as of 4/12/15) which serves as a no-fee overdraft companion to my Ally Interest Checking with unlimited ATM fee rebates. Along the same lines, I could get 2.25% in an outside bank’s 5-year CD, but Ally has 2.00% APY on their 5-year CDs and a relatively short 150-day early withdrawal penalty. A rate difference of 0.25% on $10,000 over a year is $25, and I’m not sure that’s enough to open a CD at another bank when my current Ally CDs mature.

All rates were checked as of 4/12/15.

Filed Under: Banking, Deals & Offers //

Lowe’s $10 off $50 Coupon Code

Posted on April 12, 2015 // 1 Comment

lowescouponUpdated with new coupon. As a homeowner, unfortunately there’s always a use for these… Lowe’s has a new $10 off $50 coupon available to everyone if you sign up for their promotional e-mails. You can use a secondary e-mail or simply unsubscribe after you get the coupon. Simply visit their front page at Lowes.com and scroll down to the bottom and click on “Save $10 When You Join E-mail Alerts”:

lowescoupon2

Redeemable in store or online. You must use the coupon within 7 days of receipt. There are a few exclusions:

Receive a promo code for $10 off your next purchase of $50 or more (calculated before taxes and after applicable discounts) when you sign up for Lowe’s promotional emails. Offer valid for new email accounts only. Redeemable in-store or online. Coupon is single use, can’t be used in conjunction with any other coupon/discount, and not valid on: previous sales; multiple transactions; purchase of services, installation, or extended protection plans; gift cards; Weber products; Dacor, ICON, GE Café, or Fisher & Paykel, brand appliances; or clearance appliances.

Filed Under: Deals & Offers //

Wealthfront Offers Tax Loss Harvesting With No Minimums

Posted on April 7, 2015 // 9 Comments

wf_logo

Automated portfolio managers like Wealthfront will set you up with a diversified mix of index funds and manage it for you for a small fee. I’m an investing geek, so I always lean towards keeping the small fee and manage things myself. But an important variable to this equation is tax-loss harvesting. Tax-loss harvesting tries to improve your returns by minimizing your tax bill, but it is also tedious work that is ideally suited to handing over to a computer.

If the management fee they charge is say 0.25%, as long as the benefit from tax-loss harvesting is at least 0.25%, then you’re already ahead of the game. The problem is that predicting the actual benefit of TLH is difficult. Wealthfront claims that based on past data, their tax-loss harvesting implementation could add 1.55% annually to your after-tax returns. Here is their whitepaper showing the assumptions they used to get that number.

Up until recently, you also needed $100k in your portfolio. But Wealthfront has recently announced that as of April 2015, their daily tax-loss harvesting service will be available to all taxable accounts with no minimum balance requirement:

We’re proud to announce that our daily tax-loss harvesting service will be made available to all Wealthfront taxable accounts, starting in April. At Wealthfront, we believe everyone deserves sophisticated financial advice, and this brings us one step closer to that goal.

I would not have predicted this a few years ago: automated tax-loss harvesting for any account size and at such a low cost. A customer with just $500 would be getting TLH and portfolio management for free. (As of February 2017, the minimum needed to open a Wealthfront account is only $500.)

I would say that I am confident the benefit of TLH over the long-run will be greater than zero. However, I would not count on 1%. But even if we split the difference and assume it is 0.5%, then using such a service still has to be considered as it is greater that their management fee of 0.25%.

Current sign-up promotions. The standard fee schedule for Wealthfront is that your first $10,000 is managed for free. Assets above that are charged a flat 0.25% fee annually. With a special invite link, you can get your first $15,000 managed for free, forever (an additional $5k). You can then invite your own friends (they get another $5k managed for free, and you get another $5k managed for free.)

(Note: Competitor Betterment also has a similar tax-loss harvesting service. The post structure is similar, but I wanted to make sure any readers that may see only one post get the full context.)

Filed Under: Deals & Offers, Investing //

Betterment Offers Tax Loss Harvesting With No Minimums

Posted on April 7, 2015 // 9 Comments

bettertlh_logoAutomated portfolio managers like Betterment will set you up with a diversified mix of index funds and manage it for you for a small fee. I’m an investing geek, so I always lean towards keeping the small fee and manage things myself. But an important variable to this equation is tax-loss harvesting (TLH). Tax-loss harvesting tries to improve your returns by minimizing your tax bill, but it is also tedious work that is ideally suited to handing over to a computer.

If the management fee they charge is theoretically 0.25%, as long as the benefit from tax-loss harvesting is at least 0.25%, then you’re already ahead of the game. The problem is that predicting the actual benefit of TLH is difficult. Betterment claims that based on past data, their Tax Loss Harvesting+ service could add an estimated +0.77% in after-tax returns, annually:

bettertlh_full

Up until recently, you also needed $50k in your portfolio. But Betterment just sent me an e-mail today (April 2015) that their tax-loss harvesting service will be available to all taxable accounts with no minimum balance requirement:

Using our smarter technology, we’ve now made Tax Loss Harvesting+ available to you and all of our customers—regardless of balance—at no additional cost.

We are the only automated investing service to provide this tax-reduction strategy, once only available to the wealthiest, for all investors. By democratizing tax loss harvesting, we are continuing our mission of making smarter investing accessible to everyone.

I would not have predicted this a few years ago: automated tax-loss harvesting for any account size and at such a low cost. A customer with $10,000 would be getting TLH and portfolio management for $25 a year. Betterment has no minimum investment requirement.

I would say that I am confident the benefit of TLH over the long-run will be greater than zero. However, I would not count on 0.77%. But even if we split the difference and assume it is 0.4%, then using such a service still has to be considered as it is greater that their management fee of 0.15% to 0.35%. I hate giving up control though, so while I have put a little seed money in various places, I am still 95%+ DIY and keeping a close eye on future developments.

Filed Under: Deals & Offers, Investing //

1,000 Free Hilton Honors Points For Updating Password

Posted on March 19, 2015 // 5 Comments

Hilton is offering people 1,000 Hilton HHonors points for creating a “real” password to replace their previous 4-digit PIN. Took me less than a minute. You must do this between March 12th and March 25th, 2015, and points will be posted in 6-8 weeks. From the e-mail I received:

As of April 1, 2015, we will no longer be accepting PINs. All members will instead be required to create a secure password. […] As a thank you, if you proactively update your password before March 25, 2015, you’ll receive 1,000 Hilton HHonors Bonus Points. […] Create your password now by following the steps below:

• Visit the Personal Information section in your account profile by logging in with your current credentials, and then select “Create Username and Password”.
• Your new password must be at least 8 characters, contain at least 1 upper case letter, contain at least 1 number or 1 special character.

If you are not a current Hilton Honors member that joined before 3/12/15, you are not eligible. However, you can sign-up for a new account using this separate 1,000 point bonus.

Participating in this promotion will also extend the expiration date of your points to 12 months out from the date of posting. Per the Hilton website:

Hilton HHonors points do not expire as long as members remain active in the program. To keep an account active, members can stay at one of Hilton Worldwide’s hotels, or earn or redeem HHonors points within 12 months.

Filed Under: Deals & Offers //

Fidelity IRA Match: Switch and They’ll Match Your Contributions Up to 10%

Posted on February 26, 2015 // 15 Comments

Fidelity has released an infographic [pdf] about the power of saving 1% more of your income:

fido1more

To coincide with this, Fidelity started a related promotion to entice folks to move over their IRA assets to them. The Fidelity IRA Match is designed to mimic the 401(k) contribution matching that many employers offer, where Fidelity will match between 1% and 10% of your future contribution for 3 years if you roll over $10,000+ to them. Valid for both new and existing Fidelity customers, but only for IRAs and not other account types. Here’s the breakdown:

Qualifying transfer* Match rate Estimated max benefit* (age 50+)
$10,000 1% $165 ($195)
$50,000 1.5% $247.50 ($292.50)
$100,000 2.5% $412.50 ($487.50)
$250,000 5% $825 ($975)
$500,000 10% $1,650 ($1,950)

 

* Qualifying transfers must be rollovers or transfers from non-Fidelity IRAs (Traditional or Roth). Rollovers from workplace savings plans are not eligible for this offer. Estimated max benefit is based on $5,500 annual contribution for three years ($6,500 for age 50+). Max benefit is set at $1,950.

It’s an interesting proposal. Keep in mind that many IRA custodians will ding you with an outgoing transfer fee if you move your money out. Also, Fidelity has other deposit promotions going on that offer a little less than the max payout here, but they are more straightforward bonuses.

To participate, you must register at www.fidelity.com/IRAmatch. If you do participate, I would like to point out the availability of their Fidelity Spartan Index funds, their Fidelity Freedom Index 20XX target-date funds which you can now purchase in an IRA, and their commission-free iShares ETFs. Fido has some good, low-cost products on their menu, but you may have to look for them.

Selected fine print:

[Read more…]

Filed Under: Deals & Offers, Investing, Retirement //
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