Financial bad boys; Closet materialist and new cars; As good as it gets at 2.6%?!'; Personal finance B.S.?; 10 rules for coupledom finance

Financial bad boys; Closet materialist and new cars; As good as it gets at 2.6%?!'; Personal finance B.S.?; 10 rules for coupledom finance

1) The good, bad and financially ugly habits of boyfriends

There are a many great ironies in life. One of them is why good women wind up with men who are bad for them and vice versa. This unwritten policy seems to apply on the personal finance level as well. Big spenders attracted to big savers, financial illiterates and CFOs, princesses and paupers. Perhaps it is merely a law of opposites attracting. This girly personal finance blog, carries the confessions of three gals commenting on the financial habits of their BFs. Financial soul mates are a rarity indeed.

2) Material girl

I have a confession of my own to make. Over the past few weeks, I have been seduced by a very unlikely suitor. A shiny red Beamer. Red's not my colour but the sixth generation BMW that's been racing around on our web site has captured my attention where pretty much every other advertisement ever has failed. Of course, there's no way I'll be purchasing a Beamer in this lifetime unless I win the lottery which is also unlikely because of another law, called probability.

Does it ever make sense to buy a new car, outside of a big windfall? I doubt it although this blog by plantingmoneyseeds.com suggests otherwise.

3) Gloomy outlook

Here's a stock market indicator sure to take the wind out of your sails.The Globe and Mail reports on Yale University professor of economics Robert Shiller's cyclically adjusted price earnings (CAPE) method.  Unlike the standard P/E calculation which divides a stock's price by its earnings per share per year, Shiller's CAPE method divides the stock price by its inflation-adjusted annual earnings over the last 10 years.  As a forecasting tool, Shiller's CAPE is reportedly more accurate because it smoothes out gains and losses.

Shiller's CAPE crystal ball doesn't bode well for investors trying to crack the market today.

History suggests that long-term returns are likely to be meagre for those buying in at today’s prices. Previous periods when earnings yields were between 4 per cent and 5 per cent produced average annual returns (adjusted for inflation and including reinvested dividends) of a mere 2.6 per cent over the subsequent 10 years.

If history repeats itself, today’s investors have little margin of safety. In a market like this, it’s important for investors to keep management fees and taxes to a minimum because reducing such levies are likely to mean the difference between long-term gains and losses.

4) One size does not fit all

I've said it once and I'll say it again, one style of personal finance does not fit all because everyone's circumstances and habits are different. Businessinsider.com drives home a similar message on this blog critiquing over-used personal finance tips and cliches.

5) 10 financial commandments for coupledom

The right pairing can result in a financial powerhouse if you go about things the right way. Here's 10 rules from marriedwithdebt.com on how to plan together as a couple. Same rules apply for singles I reckon.

To read other Take Fives by Amanda Morrall click here. You can also follow Amanda on Twitter@amandamorrall

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Re No.1 - those 'girly' blogs remind me of the savekaryn.com blog where a NY girl had stacked up loads of credit card debt and ran one of the first blogs describing her spending & debt repayment. Then she started a kind of professional begging where readers helped her pay off the credit cards. Then she got a book deal   -  etc etc ...
Too many other pretenders put a stop to these professional begging style blogs I think.  Still, .... could be useful on that lingering Visa balance?!  

Yeah, some of them are pretty lame alright. I threw that one in because I find the financial psychology between couples interesting. Really is rare to find a couple on the same page. 

Well, it was quite an interesting book/phenomenon - http://www.prettyinthecity.com/save-karyn/         - took the debt confessional to a new level with professional begging techniques  - ie pay voluntarily in return for the blog updates. Perhaps a business model for BH to consider? He could have a daily/hourly meter showing all reader payments  -  then perhaps competitive ratings between writers/stories (think some of the USA newspapers rate their writers/stories on hit rate)
Re the car cost thing:  well, living within 4 kms of work has benefits allowing walking/biking  -   one car for a couple. (Other than the partial funding for the kids car).